Comparative Report on the Requirement of Adjustment for Inflation of the Emerging Markets' Financial Statements

APPLICATION OF THE ADJUSTMENT FOR INFLATION TOEMERGING MARKETS’ FINANCIAL STATEMENTSThe following information regarding legislation which rules or allows adjustment forinflation of emerging markets’ financial statements was gathered from the authorities ofthose markets.COUNTRIES THAT HAVE NOT ISSUED ANY REGULATION ONADJUSTMENT FOR INFLATION OF FINANCIAL STATEMENTS, NEITHERFOR THE ISSUERS NOR FOR THE SECURITIES THEMSELVES:1.- KOREA2.- CROACIA3.- PHILIPPINES4.- GUATEMALA5.- HUNGARY6.- INDONESIA7.- JORDAN8.- KAZAKASTAN9.- LITHUANIA10.- MALAYSIA11.- MOROCCO12.- MAURITIUS13.- NIGERIA14.- PANAMA15.- PARAGUAY 16.- SRI LANKA17.- THAILAND18.- TAIWAN19.- TUNISIA20.- URUGUAYCOUNTRIES THAT HAVE ISSUED LEGISLATION WHICH IMPLIES PARTIALADJUSTMENT FOR INFLATION OF FINANCIAL STATEMENTS:1.- COSTA RICA:The College of Public Accountants of Costa Rica has issued a rule which constitutes apartial adjustment for inflation by applying a monetary adjustment index to inventories andfixed assets (property, plant and equipment).2.- SLOVENIA:By Decree Nº 2649/93 the authority may apply partial adjustment for inflation to financialstatements. Those adjustments are applied to different items considering theircharacteristics.In case of hiperinflation, additional adjusted information is allowed, following guidelinesthat are very similar to those determined in IAS 29. It is considered that there is a situationof hiperinflation when the annual inflation exceeds the 40%. However, this information isnot compulsory.3.- TURKEY:Makes annual re valuations of fixed assets and of credits and debts. COUNTRIES THAT APPLY ADJUSTMENT FOR INFLATION TO FINANCIALSTATEMENTS1.- COLOMBIA:Applicable Law: nationalType of Adjustment: completeApplicable Index: Medium Incomes Consumer Price IndexAdjustment destiny: Incomes Statement.2.- ISRAEL:Applicable Law: nationalType of Adjustment: completeApplicable Index: Consumer Price IndexAdjustment destiny: Income Statement.3.- PERU:Applicable Law: nationalType of Adjustment: completeApplicable Index: Wholesale Price IndexAdjustment destiny: Income Statement.4.- POLAND: In case inflation during the last three years before the date of the concerned period washigher than 30% a year, the rectification of financial statements is required with the aid ofan indicator that measures inflation.5.- SOUTH AFRICA:Applicable Law: international (IAS 29)6.- VENEZUELA:Applicable Law: nationalType of Adjustment: completeApplicable Index: Consumer Price IndexAdjustment destiny: Incomes Statement.COUNTRIES WHICH USED TO APPLY BUT SUSPENDED THE ADJUSTMENTFOR INFLATION1.- ARGENTINA:Applicable Law: nationalType of Adjustment: completeApplicable Index: Wholesale Price IndexAdjustment destiny: Incomes Statement.2.- BRAZIL:Applicable Law: nationalType of Adjustment: complete Applicable Index: Accountant Monetary UnitAdjustment destiny: Incomes Statement.