Company: BLRX
Filing Date: 2025-03-31
Form Type: 20-F
Source: 0001178913-25-001123
Chunk: 331

Company: BioLineRx Ltd.
Filing Date: 2025-03-31
Form: 20-F
Item: Item 19
Chunk 331
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 evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

F - 2

Intellectual Property Impairment Assessment

As described in Notes 4 and 9 to the consolidated financial statements, the Company's intangible assets relating to its intellectual property used for development services was $10.2 million as of December 31, 2024. Management conducts an annual impairment test, or more frequently if events or circumstances indicate that the carrying value of the intellectual property may be impaired. Potential impairment is identified by comparing the recoverable amount of the intellectual property to its carrying value. Value in use to the Company is estimated by management using a discounted cash flow model. Management's cash flow projections included significant judgments and assumptions relating to the weighted average cost of capital and the amount and timing of projected future cash flows.

The principal considerations for our determination that performing procedures relating to the intellectual property impairment assessment is a critical audit matter are (i) the significant judgment by management in developing the weighted average cost of capital and the amount and timing of projected future cash flows; (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to the weighted average cost of capital and the amount and timing of projected future cash flows; and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included among others: (i) testing management’s process for developing the value in use estimate; (ii) evaluating the appropriateness of the discounted cash flow model used by management; (iii) testing the completeness, accuracy, and relevance of underlying data used in the discounted cash flow model; and