Report by the Board of Directors of Grupo Carso, S.A.B. de C.V. in regard to the principal accounting and information policies and criteria followed in the preparation of the Company’s financial statements and in the reports on the operations and activities in which it was involved, in conformance with Article 28, fraction IV, subparagraphs d) and e) of the Stock Market Law.
Principal accounting and information policies and criteria followed in the preparation of the Company’s financial statements.
After the prior favorable opinion of the Auditing and Company Practices Committee, the Board of Directors examined and approved the accounting and information policies and criteria that were utilized in the preparation of the consolidated financial statement of Grupo Carso, S.A.B. de C.V. and its subsidiaries up to December 31, 2021 in reference to the following aspects, among others:
1. Activities
2. Significant events
3. Combination of businesses
4. Consolidated subsidiaries
5. Cash and cash equivalents
6. Investments in securities preserved after their expiration
7. Accounts receivable
8. Taxes recoverable
9. Inventories
10. Right-of-use assets
11. Lease liabilities
12. Administration of financial risks
13. Financial instruments
14. Derivative financial instruments
15. Real estate, machinery and equipment
16. Investment properties
17. Investments in associated company stocks, joint businesses and other
18. Other assets
19. Intangible assets
20. Short and long-term debt
The details and scope of the accounting and information policies and criteria indicated above are contained in Note 35, Principal Accounting Policies, and the respective text shall be considered to be transcribed herein as if it actually was.
MATTERS ESTABLISHED IN THE STOCK MARKET LAW
During the fiscal year of 2021 and up to the present, the Board of Directors of Grupo Carso, S.A.B. de C.V. held several meetings in which the information related to the results and operations of the Company and its subsidiaries, as well as the Company’s consolidated and unconsolidated financial statements, were presented to the Directors. In the said meetings the Directors discussed several matters – among which were some that are established in the Stock Market Law – and they approved the following matters, with the prior favorable opinion of the Auditing and Company Practices Committee:
The operations with related parties, successively executed with some subsidiaries of Grupo Carso, S.A.B. de C.V., each of which represents more than one percent of the Company’s consolidated assets, were as follows:
a)Transactions carried out for 4,239,702 thousands of pesos, between Empresa de Servicios y Soporte Integral GC, S.A.P.I. de C.V. and Carso Infraestructura y Construcción, S.A. de C.V. (“Cicsa”) and some of its subsidiaries; fiber optics down-pipes (from the post to the well); installation of chambers (Ciudad Segura); external installation of fiber optics; engineering works (design of the telephony and internet network for Telmex companies).
b)Transactions carried out for 3,942,302 thousands of pesos between Red Nacional Última Milla, S.A. P.I. de C.V. and (i) Cicsa and some of its subsidiaries: high zero down pipes, maintenance and duct works; and (ii) Grupo Condumex, S.A. de C.V. (“Grupo Condumex”) and some of its subsidiaries: sale of cabinets for telecommunications.
c)Transactions carried out for 3,179,536 thousands of pesos between Aptiv Services US LLC and other companies of the Aptiv Group and Grupo Condumex and some of its subsidiaries: the sale of harnesses, cables and automotive engineering services.
All the operations with related parties were examined by Galaz, Yamazaki, Ruiz Urquiza, S.C. and a summary of those operations is found in Note No. 26 of the opinion on the financial statements of Grupo Carso, S.A.B. de C.V. and its subsidiaries up to 31 December 2021.
The ratification of the accounting firm Galaz, Yamazaki, Ruiz Urquiza, S.C. for the external auditing services of the consolidated financial statements of Grupo Carso, S.A.B. de C.V. and its subsidiaries up to 31 December 2021, as well as its fees.
The consolidated financial statements of Grupo Carso, S.A.B. de C.V. and its subsidiaries up to 31 December 2021 for submission to the consideration of the Company’s annual General Ordinary Shareholders meeting.
CHAIRMAN OF THE BOARD OF DIRECTORS
