Following is a summary of the most significant accounting policies, methods and criteria for recognizing the effects of inflation on the financial information:d) Inventories and cost of sales—This item is originally recorded through the last-in first-out method and is subsequently restated to replacement cost. Values thus determined do not exceed market value.f) Property, plant and equipment—These items are recorded at acquisition cost, restated by applying inflation factors derived from the NCPI according to the antiquity of the expenditure.h) Depreciation—This item is calculated based on the restated values of property, plant and equipment, based on the probable useful life as determined by independent appraisers and the technical department of the group. Annual depreciation rates are shown in Note 6.n) Stockholders’ equity—The capital stock, legal reserve, contributions for future capital increases, and retained earnings represent the value of those items in terms of December 31, 2007 purchasing power and are restated by applying NCPI factors to historical amounts.
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