Public Account 2018

BUDGET AND ACCOUNTING IN CONTRAST

This point analyses the differences between the current result of the Saving-Investment-Financing Account (AIF) of the Central Administration and the result disclosed in the Statement of Current Result (Resources and Expenses) of the Balance Sheet.

These reports are elaborated under different methodological criteria, so it is very useful to disclose this analysis.

Among the aforementioned methodological differences, we can mention the following:

Difference between accrued and collected of resources Budget execution. The AIF takes into account the amount collected, while the accounting shows the accrued amount. For fiscal year 2018 this had an impact both on Non Tax Revenue and on Sale of Goods and Services of the Public Administrations.
Transfers of Capital collected are considered Current Resources for the accounting purposes, while in the AIF are registered as Capital Resources.
Expenses for Direct Tax are registered as Operating Expenses for the accounting purposes, while in the AIF there is a separate item named Direct Tax.
Military and Security expenses on Property, Plant and Equipment are considered as Property, Plant and Equipment for the accounting purposes, while in the AIF they are taken as Operating Expenses.
Transfers of capital granted to the Provinces and Municipalities, to the External and Private Sectors are considered as Current Expenses for the accounting purposes, while in the AIF they are disclosed as Capital Expenses.
Commissions for Debts are considered Operating Expenses in the AIF while they are part of the expenses for Return on Property in the Statement of Current Results.
Claims and mediations: for accounting purposes they are part of Other Expenses but for the budget execution they are under Operating Expenses.

There follows a table showing a contrast between the items of the AIF and the ones of the Statement of Current Results, with a detail of the differences of each case.

Then, there is a detail of the methodological differences for each amount and the concepts not considered for the yearly budget but having an impact on the equity.

-In Pesos-

CONCEPT	SAVING INVESTMENT FINANCING ACCOUNT	STATEMENT OF RESOURCES AND CURRENT EXPENSES	DIFFERENCE	OBS
CURRENT REVENUE	1.064.694.055.391,76	2.156.553.448.245,88	1.091.859.392.854,12
Tax Revenue	926.030.145.463,57	926.030.145.463,57	0,00
Contributions to Social Security	10.152.380.239,92	10.152.380.239,92	0,00
Non Tax Revenue	26.974.534.168,89	26.974.383.852,09	(150.316,80)	(1)
Sale of Goods and Services of Public Administrations	3.516.297.807,12	8.164.681.252,37	4.648.383.445,25	(2)
Return on Property	89.026.440.825,19	89.353.438.398,94	326.997.573,75	(3)
Transfers received	8.994.256.887,07	15.059.222.268,35	6.064.965.381,28	(4)
Other resources	0,00	1.080.819.196.770,64	1.080.819.196.770,64	(5)
CURRENT EXPENSES	1.451.603.673.345,66	7.227.352.373.200,81	5.775.748.699.855,15
Operating expenses	337.803.024.933,07	327.088.117.414,56	(10.714.907.518,51)	(6)
Return on Property	541.583.165.221,26	952.053.915.981,65	410.470.750.760,39	(7)
Social Security Services	19.553.759.972,23	19.553.759.972,23	0,00
Direct Taxes	52.549.986,74	0,00	(52.549.986,74)	(8)
Transfers granted	552.610.710.131,38	617.210.158.590,46	64.599.448.459,08	(9)
Other losses	463.100,98	5.311.446.421.241,91	5.311.445.958.140,93	(10)
CURRENT RESULT	(386.909.617.953,90)	(5.070.798.924.954,93)	(4.683.889.307.001,03)

Observations:

(1) DIFFERENCES IN NON TAX REVENUE

- in $ -

CONCEPT	AMOUNT
Difference in methodology in the accounting treatment given to accrued and collected amounts of Resources Budget execution	(150.316,80)
TOTAL	(150.316,80)

2) DIFFERENCES IN THE SALE OF GOODS AND SERVICES OF THE PUBLIC ADMINISTRATIONS

- in $ -

CONCEP		AMOUNT
Difference in methodology in the accounting treatment given to accrued and collected amounts of Resources Budget execution		2.997.595,79
Movement of Operating Assets:
	Ministry of Transport			2.912.789.121,38
	Legal and Technical Secretariat			56.124.261,65
	Ministry of Defense			1.676.472.466,43
TOTAL			4.648.383.445,25

(3) DIFFERENCES IN RETURN ON PROPERTY

- in $ -

CONCEP	AMOUNT
CER reclassification for Treasury Bills portfolio	275.855.150,16
Balance adjustment of “Bocones Proveedores”	50.083.467,44
Balance update Fundación Favaloro	698.728,12
Movement of Property, Plant and Equipment and Operating Assets	360.228,03
TOTAL		326.997.573,75

(4) DIFFERENCES IN TRANSFERS RECEIVED

- in $ -

CONCEP	AMOUNT
Differences in methodology in the accounting treatment given to Budget registrations for capital transfers received	6.000.179.734,49
Movement of Property, Plant and Equipment and Operating Assets:
Transfers received from private sector	74.123.863,72
Transfers received from public sector	(9.973.000,13)
Transfers received from external sector	634.783,20
TOTAL	6.064.965.381,28

(5) DIFFERENCES IN OTHER RESOURCES

- in $ -

CONCEPT	AMOUNT
Difference in Exchange rate – Public Debt (b)	540.099.561.141,47
Difference in Exchange rate NTO Accounts in foreign currency (b) (*)	324.842.795.722,73
Movement of Property, Plant and Equipment and Operating Assets	10.907.409.765,21
Difference in quotation of bonds in portfolio	2.124.113.847,25
CER 2018 (a)	1.684.075.423,65
Quotation adjustment of Brady Guarantees 2018 (b) (*)	840.837.976,84
Differences in Exchange rates for rescued loans (b) (*)	169.733.561,21
Differences in Exchange rates 2018 for recovery of guarantee 7/15 - IEASA (b) (*)	109.267.706,88
Difference in quotation – termination of Rep. Arg. discount bonds U$S (b) (*)	15.197.930,64
Difference in Exchange rate for return and excess in liquidation (b) (*)	4.830.448,14
Difference in Exchange rate termination of negotiable instruments linked to GDP U$S (b) (*)	467.722,57
Balance adjustment	73,47
Increase during fiscal year of:
Trust Fund for the development of renewable energy	158.404.892.077,00
Trust Fund Argentine Bicentenary Credit Program for Single Family House	2.760.027.000,00
Federal Trust Fund of Regional Infrastructure	2.718.654.027,41
Trust Fund for Social Housing	1.513.460.499,00
Trust Fund of Production Development	400.000.000,00
Trust Fund for Subsidies to Residential use of liquid gas	6.155.136,84
Result of Fiscal year for:
Trust Fund for Provincial Development	8.393.568.632,13
Fund of Waters Infrastructure	8.004.823.980,71
Fund for the Development of Renewable Energy	6.312.242.979,00
Fund for Universal Health Insurance	3.434.504.233,95
Federal Trust Fund for Regional Infrastructure	2.524.079.045,03
Trust Fund for companies reconstruction	1.653.530.666,96
Trust Fund for Transport Infrastructure	1.265.898.305,67
Trust Fund for Federal Electricity Transport	811.427.478,63
Trust Fund for Promotion of Science and Technology	330.163.735,56
National Trust Fund of Agro industry	286.453.191,00
Infrastructure Fund of Airports Security	210.745.018,96
Guarantee Fund for Small and Medium Sized Companies	189.354.803,77
Trust Fund for Mortgages Refinancing	186.770.652,98
National Fund for the development of Small and Medium Sized Companies	185.695.910,09
Administration Trust Fund Proyecto Reactor CAREM	184.472.664,81
Assistance Trust Fund of the Federal Trust Fund of Regional Infrastructure	97.700.098,32
Trust Fund for Integral Medical Services to the community	44.718.068,00
Fund for the Federal Operative Strengthening	42.227.095,00
Trust Fund for the Promotion of sheep raising	31.394.775,92
Trust Fund for Social Housing	27.945.373,84
TOTAL	1.080.819.196.770,64

(*) These amounts are $ 325.983.131.069,01. See Point (b) Difference in Exchange Rates (*)

(6) DIFFERENCES IN OPERATING EXPENSES

- in $ -

CONCEP		AMOUNT
Methodological difference in the accounting treatment given to Budget registrations for:
Debt Fees		-12.031.545.914,30
Military and security expenses in Property, Plant and Equipment		-3.174.376.191,52
Losses for claims		-1.006.844.693,68
Direct Taxes		52.549.986,74
Amortization:
Depreciation of Property, plant and equipment	4.736.323.861,72
Amortization of Intangibles	494.715.211,76
Depreciation of biological assets	3.863.402,22
Public Debt. Long term external loans: expenses and fees.	185.379.467,76
Movement of Property, Plant and Equipment and Operating Assets	24.983.232,18
Regularization: Technical and professional services	90.068,20
Regularization: maintenance, repair and cleaning.	(45.949,59)
TOTAL	(10.714.907.518,51)

(7) DIFFERENCES IN EXPENSES FOR RETURN ON PROPERTY

- in $ -

CONCEPT		IMPORTE
	Methodological difference in the accounting treatment given to the Budget registration for Fees an other expenses for debt	12.031.545.914,30
	CER 2018 (a)	251.688.483.672,25
	Non accrued enforceable interest of the public debt	69.115.533.595,94
	Public Debt – long term interest in domestic currency	57.160.154.443,34
	Public Debt – long term interest in domestic currency	20.485.364.685.26
	Public Debt – expenses for long term fees in foreign currency	(10.331.550,70)
	TOTAL	410.470.750.760,39

(8) DIRECT TAXES

- in $ -

	CONCEP	AMOUNT
	Methodological difference in the accounting treatment given to Budget registration of:
	Direct Taxes	(52.549.986,74)
	TOTAL	(52.549.986,74)

(9) TRANSFERS GRANTED

- in $ -

	CONCEP		AMOUNT
	Methodological difference in the accounting treatment given to Budget registration of capital transfers to:
Provinces and Municipalities		48.679.746.681,58
Private Sector		2.160.250.642,16
External Sector		48.250.507,34
	Movement of Operating Assets and Property, Plant and Equipment		13.796.422.188,19
	Reclassif. of contributions to Comisión Mixta Argentino Paraguaya del Río Paraná año 2017-2018		(85.219.389,00)
	Disaffect 2017- Ministry of Foreign Affairs		(2.234,98)
	Regularization 2016 – Min. Of Education, Culture, Science and Technology		63,79
	TOTAL		64.599.448.459,08

(10) OTHER LOSSES

- in $ -

CONCEPT	AMOUNT
Methodological difference in the accounting treatment given to Budget registration of:
Loss for claims	1.006.844.693,68
Difference in Exchange rate 2018 – Public Debt (b)	4.842.898.066.541,54
Differences in Exchange rates Treasury accounts in foreign Exchange (b) (*)	228.553.074.853,87
Fiscal Agreement, under minute of meeting CGN-DADP-TGN	80.435.660.929,97
Difference in Exchange rate Treasury Bills in dollars (b) (*)	75.618.912.734,52
Property, Plant and Equipment and Operating Assets	8.104.209.410,39
Payment of Decentralized Bodies – Multilateral Bodies 2018	4.555.221.518,60
Cancellation of mutual debt under the fiscal agreement between National Government and the Province of Jujuy.	146.398.807,20
Difference in Exchange rate for recovered loans in 2018 (b) (*)	89.674.063,75
Difference in Exchange rate for payment by Note (b) (*)	55.043.309,44
Cancellation of mutual debt under the fiscal agreement between National Government and the Province of Río Negro.	1.777.255,12
Termination of bonds under the liquidation process of Telam S.A.I.C. y P.	1.077.980,48
Dicrease of Fiscal Year:
Trust Fund for the Argentine Bicentenary Credit Program for Single House	9.000.000.000,00
Trust Fund for Companies reconstruction	8.509.638.959,71
Trust Fund for Transport Infrastructure	7.803.444.365,46
Fund for the Development of Renewable Energy	6.000.000.000,00
Trust Fund of Waters Infrastructure	5.564.303.034,37
Federal Trust Fund of Regional Infrastructure	3.000.000.000,00
National Fund of Production Development	2.952.190.809,00
Trust Fund for Social Housing	1.782.800.000,00
Trust Fund for Federal Electricity Transport	1.454.815.239,65
Administration Trust Fund of Proyecto Reactor CAREM	1.177.961.636,57
National Fund for the Development of Small and Medium Sized Companies	910.637.511,79
Trust Fund for the Integral Medical Assistance to the Community	566.114.181,00
Fund for the Federal Operations Strengthening	559.829.815,00
Trust Fund for the Promotion of Science and Technology	334.731.895,33
Administration Fund for the Subsidy of Residential use of liquid gas	328.624.502,60
National Trust Fund of Agro industry	300.417.819,00
Assistance Trust Fund for the Federal Trust Fund of Regional Infrastructure	97.799.999,96
Trust Fund for the subsidy of residencial use of gas – Law 25.565	12.822.733,92
Trust Fund for the promotion of Software Industry	5.446.696,51
Trust Fund for the subsidy of residential use of liquid gas Law 26020	2.103.119,73
Trust Fund for Mortgages Refinancing	849.739,46
Guarantee Fund for Pyme	359.477,80
Result for fiscal year:
Trust Fund Argentine Bicentenary Credit Program for Single Housing	16.263.318.000,00
Trust Fund for the subsidy of residential use of gas Law 25.565	29.428.146,22
Administration Fund for the subsidy to residential use of liquid gas	7.885.835,43
Trust Fund for the promotion of Software industry	1.136.771,86
Fiscal year adjustment:
Trust fund for Argentine economic development	3.313.335.752,00
TOTAL	5.311.445.958.140,93

(*) These amounts are $ 304.316.704.961,58. See point (a) Difference in exchange rate.

There follows a detail of the concepts with higher incidence in the accounting result.

(a) CER – Reference Stabilization Ratio 2018 (in pesos)

i) Accounting (see points 5 and 7)

Other Resources	1.684.075.423,65
Expenses for Return on Property	251.688.483.672,25
Net CER (loss)	(250.004.408.248,60)

ii) Table 34 of Section I of the Public Debt Statement

This table includes the evolution of public debt from the balance at beginning of the fiscal year, with the initial adjustments, increases and decreases of the fiscal year, with a detail of difference in exchange rate, CER, interest, etc.

For the Central Administration, the CER concept in said table includes:

Adjustment at beginning of fiscal year	228.359.882.223,97
Increase of Fiscal year	23.328.601.448,28
Dicrease of fiscal year	1.684.075.423,65
Net CER	250.004.408.248,60

Thus, it is noted that the information disclosed in this point is consistent with the data provided by the National Public Credit Office in the tables included in the Public Accounts.

(b) Difference in Exchange rates (in pesos)

i) Accounting (see points 5 and 10)

Within Other Resources there is a detail of the Exchange rates differences of the following Financial Administrative Services:

355 – Public Debt	540.099.561.141,47
999 – National Treasury Office	325.983.131.069,01
Total	866.082.692.210,48

Within Other Losses there follows a detail of the Exchange rates differences of the following services:

355 – Public Debt	4.842.898.066.541,54
NTO and other bodies	304.316.704.961,58
	5.147.214.771.503,12

Difference in Exchange rates due to Public Debt operations:

Other Resources		540.099.561.141,47
Other Losses		4.842.898.066.541,54
Net Loss		(4.378.507.092.198,33)

ii) Table 34 of Section I of the Public Debt Statement

For the concept of Exchange rates differences this table includes:

Adjustment at beginning of fiscal year	4.160.817.457.879,46
Fiscal Year increase	819.182.629.958,92
Fiscal Year decrease	534.373.097.865,69
Differences in Exchange rate	4.302.798.505.400,07

Class	Total	Total Accounting	Difference
Private banks	468.019.263,43	468.019.263,43
Bilateral	135.673.793.088,18	135.673.793.088,18	-
Multilateral	511.051.707.734,07	511.051.707.734,07	-
Suppliers	1.289.911.188,91	1.289.911.188,91	-
Bonds	3.654.315.074.125,48	3.654.315.074.125,48
Loans recovered in 2018		89.674.063,75	(89.674.063,75)
Treasury Bills issued in USD in 2018		75.618.912.734,52	(75.618.912.734,52)
Total	4.302.798.505.400,07	4.378.507.092.198,33	(75.708.586.798,26)

In accordance with the aforementioned, the information disclosed in this chapter of budget – accounting contrast is consistent with the information provided by the National Public Credit Office in the charts included in the Public Accounts.