Annual Report 2010 - AdP

Unregulated activity
The availability tariff is based on a contract established with the customer under which the rental prices is defined. The value of the
contract is recognized on a monthly basis during the month that pertains to the service.
2.23.2 Sale of assets
Regulated activity - “Upstream” services - Water supply
Yield is recognized on the basis of (i) minimum guaranteed values; or (ii) consumption, i.e. yield is recorded at the product’s value
between the approved tariff and the measured and/or estimated consumptions.
Regulated activity - “Upstream” services - Treatment and recovery of waste - product sales
Treatment and recovery of waste - products: the sale of products obtained with the recovery of waste is recorded at the time of
the transaction.
Regulated activity - “Downstream” services - Partnerships
Yield consists of two components: one fixed and one variable. Yield is recorded at the product value between the approved tariff for
each level and the measured and/or estimated consumption on that level (variable component). The fixed component corresponds to
the availability of the service and is indexed to the meter’s debit capacity. It is recognized in twelfths.
Unregulated activity
Water supply - end consumer: the sale of water to end consumers is conducted on the basis of m 3 consumed and the tariff of each
concession and non-concession are applied (EPAL). In some cases consumption estimates are made and settled when the individual
meters of each customer are read.
2.23.3 Cost recovery tariff deficit and surplus
See note 2.5.2.
2.23.4 Interest
Interest yield is recognized on the basis of the effective tax rate and is recorded during the respective period, on an accruals basis
of accounting.
When a receivable is adjusted due to impairment, the group reduces its book value to its recoverable value; however, future estimated
cash flow continues to be discounted at the initial effective interest rate (before impairment) and the settlement of the discount
continues to be considered interest income.
2.23.5 Dividends receivable
Dividends shall be recognized when the shareholder’s right is recognized, which generally occurs by decision of the General
Shareholders’ Meeting of the subsidiary or the associated company.
2.24 Own works
The cost of resources directly attributable to intangible and tangible assets are recognized during their development/construction
phase when it has been concluded that they will be recovered via realization of those assets. Capitalized financial costs and some
staff costs may be significant. They are measured at cost, and therefore recognized without any margin on the basis of internal
information especially prepared for that purpose (internal costs) or on the basis of the respective purchase costs accrued by other
underlying costs. Capitalized costs are directly recorded in the balance sheet and not in the income statement, and are stated in the
notes to the accounts whenever applicable.
2.25 Costs and losses
Costs and losses are recorded during their respective year, regardless of when they are paid or received, in accordance with the
accruals framework (accruals basis of accounting).
2.26 Subsequent events
Events occurring after the balance sheet date that offer additional information on the conditions that existed at the balance sheet
date are reflected in the consolidated financial statements. Events occurring after the balance sheet date that offer additional