Public Account 2018

The Financial Statements for the period ended December 31, 2018, with amounts expressed in Pesos ($), have been elaborated according to Law # 24,156 of Financial Administration and Control Systems for the National Public Sector, and its amendments; Resolutions of the Secretariat of Finance # 25/1995 (Generally Accepted Accounting Principles and General Accounting Procedures for the National Public Sector) and # 257/2018 S.H. (Procedures for the Closing of Fiscal Year 2018) and supplementary provisions.

ASSESSMENT CRITERIA:

a) Cash and cash equivalents

In domestic currency: at its face value.

In foreign currency: at the buying rate at the end of the fiscal year.

b) Investment, Credit and Debt

In domestic currency: at its face value.

In foreign currency: at buying rate for credit, and selling rate for debt, at closing of fiscal year.

Investments in bonds have been assessed at cost or market value, the least. Also, for those cases where it was impossible to determine the cost value, and only if they were not investments with public quotation, they were valuated according to the participation over the last known value of the patrimony invested.

Credit and debt with contractual conditions which set the right of collection or the obligation to pay an interest rate, include the corresponding accrual at closing of the fiscal year.

In relation to credit, in those cases in which there was no certainty about the recovery of the main obligation, they were not accounted for, under the Prudence theory.

c) Inventory and Related Property

At its cost of purchase or the production cost incurred for the goods obtained.

d) Trust Funds

As from fiscal year 1999, and as a consequence of the survey carried out, Trust Funds are being assessed according to the net participation which the Nation has in the same, and thus the results originated in the variations suffered during the current fiscal year have been acknowledged.

e) Property, Plant and Equipment

Property was assessed at its historic cost (purchase, building and/or production), less accrued amortization, according to the provisions of Resolution # 47/97 of the Secretariat of Finance of the former Ministry of Economy, Public Works and Services.

Real Estate, under said Resolution, was registered according to the last known quotation or assessment performed by competent authority (National Assessment Tribunal). Nevertheless, said property and its quotation are subject to the result of the tasks undertaken by the National Accounting Office and the National Assessment Tribunal, according to the provisions of Administrative Decision # 56 dated March 9, 1999.

In relation to disaffected assets administered by the National Public Assets Administration Office – ex ONABE -, if they have not been assessed by the National Assessment Tribunal, in the terms of the aforementioned regulations, the same have been included in the Inventory for its fiscal valuation if provided by the responsible parties and at a value of $1 for the rest of them.

The book value of the property as a whole is not higher than its market value at the moment it is sold out.

Disposition 19/2002 of the National Accounting Office, implemented for the first time as of December 31, 2001, set the criteria of the registration and disclosure of Heritage Assets as an integral part of the Assets.

f) Intangibles

These assets were registered at their historic value net of accrued amortizations.

g) Public Debt

The main balances of the marketing of public debt bonds were registered at the face value of the bonds marketed; loan contracts celebrated with bilateral or multilateral credit International Organizations, for the amounts actually paid and foreign currency liabilities, taking into account the corresponding quotation, at selling exchange rate on December 31, 2018.

For assessment purposes, the Public Debt Administration Office, under the National Public Credit Office, responsible for the registration of the same, used the rate provided by Reuters Agency.

In relation to bonds issued at a discount, the assessment technique adopted was “price of issuance”.

Furthermore, the implicit interest of said bonds capitalizes each year up to the rescue date.

Accrued interest not payable at closing date, have been registered and included in these Financial Statements as indicated in Note 14.

h) Legal Action

According to point II CLAIMS AGAINST THE NATIONAL GOVERNMENT of the Manual of Fiscal Year Closing, approved by Disposition # 71/2010 N.A.O. and its amendments, the Financial Administrative Services of the Central Government are required to present the information that follows:

a) Definitive sentences in the terms of Article 68 of the Permanent Supplementary Budget Law # 11,672 (t.o. 1999).

b) Adverse Appeal sentences and sentences in course;

c) Adverse first instance sentences;

d) Legal actions in course without sentence

In order to improve the disclosure of the aforementioned information in the Financial Statements, and as already indicated for fiscal year 2001, the sentences included in point a) were treated as current or non current liabilities depending on whether they had been budgeted or not for fiscal year 2018. As for points b) and c) the corresponding accounting non-current provision was made, while the ones in point d) were disclosed as “Supplementary Information to the Financial Statements”.

i) Registration of Accrued Resources

Registration of resources has been made on an accrual basis, according to the Generally Accepted Accounting Principles and General Accounting Standards for the National Public Sector.

The concept followed was registering transactions at the moment the patrimony and the result of the Entity are considered actually affected, taking into account that in order to assign a transaction to a fiscal year, it is necessary not only that the material fact has occurred within a specific period, but also that the same could be measured.

In this context, there are resources, such as tax revenue, which can only be measured objectively when they are credited to the corresponding bank accounts, which allow for a precise measurement of the changes in patrimony.

Currently, according to the applicable systems for the Public Sector, resources are accrued and registered at the moment they can be measured objectively, and when this happens at the time of collection, the time of accrual is concomitant with the time of collection.

j) Valuation of Assets and Liabilities in Foreign Currency

Law 25,561 of Public Emergency and Reform of the Currencies Regime passed on January 7, 2002 included regulations in relation to the exchange rates to be fixed.

Under the aforementioned emergency framework, the National Accounting Office stated that the valuation criterion to be followed in relation to Assets and Liabilities in foreign currency of National Administration Bodies should be the regulations fixed by Decree 214/02 and its amendments, Decree 410/02, as well as the ones related to Decree 471/02 “Reordering of the Financial System”.

DISCLOSURE OF FINANCIAL STATEMENTS

These financial statements are disclosed in the currency at closing time.

ELABORATION OF THE FINANCIAL STATEMENTS

These Financial Statements were elaborated as from the information registered in the Integrated System of Financial Information by the several Central Administration Bodies, which is automatically transformed into accounting registrations by said system.

Also, the Contributions and Capital Shares, Net Equity of Decentralized Bodies, Social Security Institutions, National Universities and Governmental Business Enterprises for the last statement presented to the National Accounting Office as of the date of elaboration of the Financial Statements, were integrated in only one line regardless of the fact that the same were or were not audited by the corresponding ruling body.