TransUnion - FORM 10-K/A - EX-99.1 - EXHIBIT 99.1

Attached files

file	filename
10-K/A - 10-K/A - TransUnion	a10-ka.htm
EX-32 - EXHIBIT 32(A) - TransUnion	exhibit32a.htm
EX-31.2 - EXHIBIT 31.2(A) - TransUnion	exhibit312a.htm
EX-31.1 - EXHIBIT 31.1(A) - TransUnion	exhibit311a.htm
EX-99.3 - EXHIBIT 99.3 - TransUnion	exhibit993cibil3-31x2013.htm
EX-99.2 - EXHIBIT 99.2 - TransUnion	exhibit992cibil3-31x2014.htm

Exhibit 99.1

TRANS UNION DE MÉXICO, S.A.,

SOCIEDAD DE INFORMACIÓN CREDITICIA

AND SUBSIDIARY

Consolidated Financial Statements

Years Ended December 31, 2013 and 2012

with Report of Independent Auditors

TRANS UNION DE MÉXICO, S.A.,

SOCIEDAD DE INFORMACIÓN CREDITICIA

AND SUBSIDIARY

Consolidated Financial Statements

Years Ended December 31, 2013 and 2012

Contents:

Report of Independent Auditors

Audited Consolidated Financial Statements:

Consolidated Statements of Financial Position

Consolidated Statements of Comprehensive Income

Consolidated Statements of Changes in Equity

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

REPORT OF INDEPENDENT AUDITORS

To the Shareholders of

Trans Union de México, S.A.,

Sociedad de Información Crediticia

We have audited the accompanying consolidated financial statements of Trans Union de México, S.A., Sociedad de Información Crediticia, and Subsidiary, which comprise the consolidated statements of financial position as of December 31, 2013 and 2012, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and the related notes to the consolidated financial statements.

Management’s responsibility for the financial statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with the International Financial Reporting Standards as issued by the International Accounting Standards Board; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free of material misstatement, whether due to fraud or error.

Auditor’s responsibility

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Trans Union de México, S.A., Sociedad de Información Crediticia, and Subsidiary at December 31, 2013 and 2012, and the consolidated result of their operations and their cash flows for the years then ended, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.

Mancera, S.C.

A member practice of

Ernst and Young Global Limited

/s/ Jorge Senties

Mexico City, Mexico

June 25, 2014

TRANS UNION DE MÉXICO, S.A.,

SOCIEDAD DE INFORMACIÓN CREDITICIA

AND SUBSIDIARY

Consolidated Statements of Financial Position

(Amounts in thousands of Mexican pesos)

(Notes 1 and 2)



	At December 31,
	2013		2012
Assets
Current assets:
Cash and cash equivalents (Note 3)	Ps. 469,967		Ps. 426,412
Debt securities at fair value through profit or loss	15,098		15,018
Accounts receivable:
Trade (Note 12)	44,642		34,967
Related parties (Note 4)	52,380		52,634
	97,022		87,601
Prepaid expenses	3,851		3,121
Recoverable taxes and others	2,863		626
	588,801		532,778
Non-current assets:
Property, furniture and equipment, net (Note 5)	101,492		109,347
Deferred income tax (Note 9)	48,903		37,200
Other assets	590		590
	150,985		147,137
Total assets	Ps. 739,786		Ps. 679,915

Liabilities and equity
Short-term liabilities:
Accrued liabilities and other taxes payable (Note 6)	Ps. 153,179		Ps. 141,090
Income tax payable (Note 9)	7,247		28,884
Related parties (Note 4)	24,013		42,632
Advances from customers	45,808		3,966
Dividends payable	3,387		2,277
Total current liabilities	233,634		218,849

Long term liabilities:
Employee retirement benefits (Note 2k)	5,446		1,041
Total liabilities	239,080		219,890

Equity (Note 7):
Capital stock	16,000		16,000
Legal reserve	3,497		3,497
Retained earnings	488,080		440,229
Accumulated other comprehensive income (loss)	(7,239	)	—
Equity attributable to equity holders of the parent	500,338		459,726
Non-controlling interest	368		299
Total equity	500,706		460,025
Total liabilities and equity	Ps. 739,786		Ps. 679,915

The accompanying notes are an integral part of these financial statements.

TRANS UNION DE MÉXICO, S.A.,

SOCIEDAD DE INFORMACIÓN CREDITICIA

AND SUBSIDIARY

Consolidated Statements of Comprehensive Income

(Amounts in thousands of Mexican pesos)

(Notes 1 and 2)



	For the years ended December 31,
	2013		2012
Operating revenues:
Sale of credit reports, net	Ps. 894,646		Ps. 875,108
Other operating revenues	61,941		51,042
	956,587		926,150
Operating and administrative expenses (Note 8)	430,042		453,948
Operating income	526,545		472,202

Finance income	18,530		18,605
Exchange gain, net	945		2,463
	19,475		21,068
Income before income tax	546,020		493,270
Income tax (Note 9)	157,073		148,076
Net income	388,947		345,194

Other comprehensive income not to be reclassified to profit or loss in subsequent periods:
Re-measurement of actuarial losses on defined
employee retirement benefit plan	(4,258	)	—
Income tax effect	1,277		—
	(2,981	)	—
Total comprehensive income for the year, net of tax	Ps. 385,966		Ps. 345,194

Comprehensive income for the year attributable to:
Controlling interest	Ps. 385,897		Ps. 345,107
Non-controlling interest	69		87
	Ps. 385,966		Ps. 345,194

The accompanying notes are an integral part of these financial statements.

TRANS UNION DE MÉXICO, S.A.,

SOCIEDAD DE INFORMACIÓN CREDITICIA

AND SUBSIDIARY

Consolidated Statements of Changes in Equity

For the Years Ended December 31, 2013 and 2012

(Amounts in thousands of Mexican pesos)

(Notes 1, 2 and 8)



			Attributable to the equity holders of the parent
	Capital stock	Legal reserve		Retained earnings		Accumulated other comprehensive income (loss)		Total equity attributable to equity holders of the parent		Non-controlling interest	Total equity
Balance at December 31, 2011	Ps. 16,000	Ps. 3,497		Ps. 412,859		Ps. ---		Ps. 432,356		Ps. 212	Ps. 432,568
Dividends paid				(317,737	)			(317,737	)		(317,737	)
Comprehensive income for the year				345,107				345,107		87	345,194
Balance at December 31, 2012	16,000	3,497		440,229		—		459,726		299	460,025
Adoption of IAS 19(R) (Note 2k)				4,258		(4,258	)				—
Dividends paid				(345,285	)			(345,285	)		(345,285	)
Comprehensive income for the year				388,878		(2,981	)	385,897		69	385,966
Balance at December 31, 2013	Ps. 16,000	Ps. 3,497		Ps. 488,080		Ps. (7,239)		Ps. 500,338		Ps. 368	Ps. 500,706

The accompanying notes are an integral part of these financial statements.

TRANS UNION DE MÉXICO, S.A.,

SOCIEDAD DE INFORMACIÓN CREDITICIA

AND SUBSIDIARY

Consolidated Statements of Cash Flows

(Amounts in thousands of Mexican pesos)

(Notes 1 and 2)



	For the years ended December 31
	2013		2012
Operating activities
Income before income tax	Ps. 546,020		Ps. 493,270
Items not requiring the use of cash:
Depreciation (Note 5b)	31,725		24,256
Employee retirement benefits (Note 2k)	1,730		1,191
Finance income	(25,368	)	(24,234	)
	554,107		494,483
Changes in operating assets and liabilities:
Interest received	25,368		24,234
Debt securities at fair value through profit or loss	(80	)	89
Trade receivables	(9,675	)	4,232
Related parties, net	(18,365	)	25,617
Prepaid expenses	(730	)	1,434
Other assets	105		314
Accrued liabilities and other taxes payable	(20,815	)	25,210
Income tax paid	(158,636	)	(131,501	)
Advances from customers	41,842		2,593
Employee retirement benefits paid	(306	)	(374	)
Net cash flow provided by operating activities	412,815		446,331

Investing activities
Investments in property, furniture and equipment (Note 5b)	(23,975	)	(26,564	)
Net cash flow used in investing activities	(23,975	)	(26,564	)

Financing activities
Dividends paid (Note 7c)	(345,285	)	(317,737	)
Net cash flow used in financing activities	(345,285	)	(317,737	)

Net increase in cash and cash equivalents	43,555		102,030
Cash and cash equivalents at beginning of year	426,412		324,382
Cash and cash equivalents at end of year	Ps. 469,967		Ps. 426,412

The accompanying notes are an integral part of these financial statements.

TRANS UNION DE MÉXICO, S.A.,

SOCIEDAD DE INFORMACIÓN CREDITICIA

AND SUBSIDIARY

Notes to Consolidated Financial Statements

December 31, 2013 and 2012

(Amounts in thousands of Mexican pesos)

1. Description of the Business

Trans Union de México, S.A., Sociedad de Información Crediticia (the Company) was incorporated in Mexico on October 4, 1995 and is primarily engaged in providing credit information services. Specifically, the Company compiles, stores, processes, analyzes and sells information related to the credit histories of individuals and it provides other credit information services related to its database. The Company operations are governed by the Mexican Law Regulating Credit Bureaus.

The registered office is located at Jaime Balmes 8, 10^th floor, in Mexico City.

Trans Union LLC (a U.S. company) is the Company's largest shareholder (25.69% equity interest), and the remaining shareholders are Mexican credit institutions, none of whom hold more than an 18% equity interest in the Company. These shareholders generate a significant portion of the Company’s revenue (Note 4 and Note 12).

At December 31, 2013 and 2012, the Company holds a 98.8% equity interest in Servicios y Asesoría SCOBC, S.A. de C.V. (the Subsidiary), who provides the Company with professional services and was incorporated in Mexico on October 22, 2007.

On June 25, 2014, the accompanying consolidated financial statements and these notes were authorized for its issuance by the Company's Chief Executive Officer and Chief Finance Officer. Subsequent events have been considered through June 25, 2014.

2. Basis of Preparation of the Financial Statements and Summary of Significant Accounting

Policies

a) Basis of preparation

The accompanying financial statements have been prepared in conformity with International Financing Reporting Standards, as issued by the International Accounting Standards Board (IASB) (IFRS).

The accompanying financial statements were prepared on an historical-cost basis except for the investments in debt securities which have been measured at fair value.

The statement of profit or loss has been prepared by nature as the Company believes that such presentation is most reliable and relevant to the readers of the consolidated financial statements.

b) Consolidation and investment in subsidiary

The accompanying consolidated financial statements include the financial information of the Company and that of its Subsidiary.

The Subsidiary's financial statements have been prepared for the same accounting period and following the same accounting policies as those of the Company. The intercompany balances, equity investments and transactions were eliminated in the consolidation process.

Non-controlling interest represents the equity interest in the operating results and net assets of the Subsidiary that does not pertain to the Company. Non-controlling interest is presented as a separate component of consolidated shareholders' equity.

c) Current versus non-current classification

The Company presents assets and liabilities in the statement of financial position based on current/non-current classification. An asset is classified as current when it is:


•	Expected to be realized or intended to sold or consumed in normal operating cycle of the Company.


•	Expected to be realized within twelve months after the reporting period, or


•	Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current. A liability is classified as current when:


•	It is expected to be settled in normal operating cycle of the Company.


•	It is due to be settled within twelve months after the reporting period, or


•	There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

The Company classifies all other liabilities as non-current.

Deferred income tax assets are classified as non-current.

d) Recognition of revenues

Service revenues are recognized at the time the Company renders the credit information services, provided that such revenues can be reliably measured, it is likely that the Company will receive economic benefits from the transaction, the stage of completion of the transaction can be reliably measured and it is highly probable that it will completed, regardless of when the related fees are actually collected.

Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duty. The Company has concluded that it is the principal in all of its revenue arrangements since it is the primary obligor in all the revenue arrangements, has pricing latitude and is also exposed to credit risks.

Revenue from sale of credit reports

Since the Company compiles, stores, processes, analyzes and sells information related to the credit histories of individuals, it provides credit information services related to its database through sale of credit reports. The Company has developed several types of credit reports based on the characteristics and risk profile of its credit database. The Company’s credit information database is maintained and updated based on the exchange of credit information with its clients (credit institutions and the financial and non-financial entities) based on the corresponding service agreements.

Trade receivables are non-interest bearing and are generally on terms of 30 to 90 days.

Sales discounts

The Company grants discounts to its customers based on the number of reports they order, quality of credit information exchanged and timely payment. The discounts require authorization from top management. Such discounts are reflected as part of the caption Sale of credit reports and are accounted for on a monthly basis based on the Company’s discount policies.

Sales tax

The Company recognizes its revenues net of value added tax. The net amount of value added tax payable to the Mexican Tax Authority is recognized in the statement of financial position under the caption Accrued liabilities and other taxes payable.

e) Operating and administrative expenses

Operating and administrative expenses are those costs related to maintaining, developing and managing the databases used to generate the Company's credit information. These expenses consist primarily of salaries and wages, annual bonuses, social security expenses, professional fees, royalties, software licenses, equipment depreciation and general administrative expenses.

f) Accounting judgments, estimates and assumptions

The preparation of the Company’s consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the consolidated financial statements were prepared. Existing circumstances and assumptions about future developments may change due to market changes or circumstances arising beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

- Allowance for doubtful accounts

The Company's policy is to evaluate the age of its accounts receivable and their collectability, creating an allowance for doubtful accounts for each customer as needed. This evaluation is made based on the type of client, recurrence of solicitation of credit services, age of the account receivable, collection experience, among others.

At December 31, 2013 and 2012, the Company has not recorded any allowance since most of its accounts receivable are collected within thirty days and management has not identified any potential risks that would reduce the certainty of their recovery. See Note 12.

- Defined benefit plans

The cost of the defined benefit pension plan and the present value of the pension obligation and seniority premiums are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases, mortality rates and future pension increases. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

- Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the statement of financial position cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the Discounted Cash Flows model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgment is required in establishing fair values. Judgments include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments.

- Taxes

Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which deferred tax assets will be applied; management judgment is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing and the level of future taxable profits together with future tax planning strategies. At December 31, 2013 and 2012, management concluded that is probable that deferred tax assets will be recoverable; as a result, management deems that a valuation allowance is not necessary.

- Property, furniture and equipment

Useful lives and methods of depreciation of property, furniture and equipment are reviewed each financial year end and adjusted prospectively, if appropriate. Those estimates are disclosed in Note 2i.

g) Cash and cash equivalents

Cash and cash equivalents principally consist of bank deposits and highly liquid investments with purchased maturities of less than three months.

h) Financial assets

- Initial recognition and measurement

Financial assets are classified, at initial recognition, as financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, available-for-sale financial assets, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial assets are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.

Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognized on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

Loans and receivables

This category is the most relevant to the Company. Loans and receivables are non-derivative financial assets with fixed payments that are not quoted in an active market. After initial measurement, such financial assets are adjusted for any impairment losses. This category generally applies to trade and other receivables. For more information on receivables, refer to Note 12.

During the years ended December 31, 2013 and 2012 the Company invested solely in debt securities classified as “at fair value through profit or loss”, which are carried in the statement of financial position at fair value with net changes in fair value presented as a component of finance income in the statement of comprehensive income.

Financial assets at fair value through profit or loss include financial assets held for trading and financial assets designated upon initial recognition at fair value through profit or loss. During the years ended December 31, 2013 and 2012, the Company did not invest in financial instruments for trading.

For the years ended December 31, 2013 and 2012, the Company does not have any derivative financial instruments.

- Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either: 1) in the principal market for the asset or liability, or 2) in the absence of a principal market, in the most advantageous market for the asset or liability. The principal or the most advantageous market must be accessible to by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognized in the financial statements on a recurring basis, the Company determines whether transfers have occurred between Levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

At December 31, 2013 and 2012, all investments in debt securities have been valuated using quoted prices in active markets (Level 1).

i) Long-lived assets

- Property, furniture and equipment

Property, furniture and equipment are initially recorded at acquisition cost and depreciation is computed using the straight-line method based on the estimated useful lives of the related assets and at the following annual depreciation rates:



Building	2.5%
Adaptations and property and leasehold improvements	10% and 20%
Computer equipment	30%
Automotive equipment	25%
Furniture and equipment	10%
Communication equipment	10%

In the normal course of business, the Company purchases various software licenses from third parties to facilitate the use and upkeep of its purchased and leased computer systems, as well as its credit tracking databases. Such licenses are for a period of 12 months or less, and most are paid for monthly although certain licenses are paid for on an annual basis. The Company follows an accounting policy of expensing all such license purchases as they are incurred as it believes that such approach represents a systematic and rational approach towards its financial reporting under IFRS.

- Impairment

The carrying value of the Company's long-term fixed assets is reviewed whenever there are indicators of impairment in the value of such assets. When the recoverable amount of an asset, which is the higher of its fair value less cost of disposal and its value in use (the present value of future cash flows that the Company expects the asset to generate) is less than its carrying value, the difference is recognized as an impairment loss. For the years ended December 31, 2013 and 2012, there were no indicators of impairment in such assets.

j) Accrued liabilities, provisions, contingent assets and liabilities and commitments

Accrued liabilities are recognized whenever (i) the Company has current obligations (legal or constructive) resulting from a past event, (ii) when it is probable the obligation will give rise to a future cash disbursement for its settlement, and (iii) the amount of the obligation can be reasonably estimated.

Contingent liabilities are recognized only when it is probable they will give rise to a future cash disbursement for their settlement. Also, commitments are only recognized when they will generate a loss.

k) Employee benefits

Employee retirement benefits

The Company has a defined benefit pension plan that covers all of its employees, which is determined based on the employees’ compensations in their final year of service, the number of years they have worked for the Company, and their age at retirement.

Labor obligations related to retirement benefits are presented net of the corresponding asset, which is carried out at fair value.

Seniority premiums are paid to workers as required under Mexican labor law.

The Company recognizes the liability for seniority premiums and termination benefits based on independent actuarial computations using the projected unit credit method and nominal hypotheses. The latest actuarial computation was prepared in December 2013.

Re-measurements, comprising of actuarial gains and losses, excluding net interest and the return on plan assets (excluding net interest), are recognized immediately in the statement of financial position with a corresponding debit or credit to retained earnings through other comprehensive income (OCI) in the period in which they occur. Re-measurements are not reclassified to profit or loss in subsequent periods.

The net interest on benefit obligation is calculated by applying the discount rate to the net defined benefit liability or asset. The Company recognizes the following changes in the net defined benefit obligation under operating and administrative expenses in the consolidated statement of comprehensive income:


•	Service costs comprising current service costs, past-service costs, gains and losses on curtailments and no-routine settlements.


•	Net interest expense or income.

The Company calculates termination benefit costs based on Mexican Labor Law and recognizes them in operating results when incurred.

The Company annually evaluates the reasonableness of the assumptions used in its employee benefits computations. Actuarial calculations, as well as the associated cost for the period, were determined using the following long-term assumptions:



	2013		2012
Discount rate used to calculate the defined benefit obligation	7.00	%	7.50	%
Projected salary increase	5.88	%	6.09	%
Future pension increases	3.50	%	3.50	%
Average employee service period	6.1 years		6.8 years

Adoption of IAS 19R

On January 1, 2013, the Company adopted IAS 19 Employee benefits (Revised), this Standard includes a number of amendments to the accounting for defined benefit plans, including actuarial gains and losses that are now recognized in Other Comprehensive Income and permanently excluded from profit and loss. Expected returns on plan assets are no longer recognized in profit or loss; instead, there is a requirement to recognize interest on the net defined benefit liability (asset) in profit or loss, calculated using the discount rate used to measure the defined benefit obligation and; Unvested past service costs are now recognized in profit or loss at the earlier of when the amendment occurs or when the related restructuring or termination costs are recognized.

IAS 19 (R) establishes retrospective application, which means that entity should present a statement of financial position at the beginning of the earliest comparative period. Therefore, an entity should present, at a minimum, three statements of financial position, two of each of the other statements and the related notes. The three statements of financial position include the statement of financial position as at the current annual period year end, the statement of financial position as at the previous annual period year end, and the statement of financial position as at the beginning of the previous annual period (’the opening balance sheet’, often referred to as the third balance sheet). The incorporation of the third balance sheet does not require the corresponding the notes.

10.

The adoption by the Company of IAS 19 (R) generated an effect of Ps. 1,149 over the Company’s net liability balance of the defined benefit plans at December 31, 2012 and the accumulated OCI at such date resulted Ps. 4,258. Based on this (effects of the adoption being insignificant in relation with the financial statements taken as a whole), the Company decided to recognize such effects prospectively, rather than retrospectively. It also concluded that given the insignificant effects that a third balance sheet would not be of any benefit to the readers of its consolidated financial statements.

Year end balances

At December 31, 2013 and 2012, the defined benefit obligation are Ps. 26,043 and Ps.18,270, respectively, and the plan assets are Ps.20,597 and Ps.19,311, respectively. Plan assets consist of government debt, and were measured using a Level 1 fair value concept. None of the plan assets were invested in securities of related parties.

For the years ended December 31, 2013 and 2012 the corresponding cost of such defined benefits was Ps. 1,730 and Ps. 1,191, respectively.

Employee profit sharing

Employee profit sharing is basically computed at 10% rate of the Company's taxable income, except for depreciation of historical rather than restated values and other effects of inflation which are excluded. Employee profit sharing is presented in the statement of income as an ordinary expense.

Compensated absences

The costs related to compensated absences, such as vacations, are recognized on cumulative basis creating the respective provision.

l) Foreign currencies

The Company's functional currency is the Mexican peso. Transactions in foreign currency are recorded at the prevailing exchange rate on the day of the related transactions. Foreign currency denominated assets and liabilities are valued at the prevailing exchange rate at the statement of financial position date. Exchange differences from the transaction date to the time foreign currency denominated assets and liabilities are settled, as well as those arising from the translation of foreign currency denominated balances at the statement of financial position date, are charged or credited to the consolidated statement of comprehensive income.

m) Comprehensive income

The comprehensive income shown in the consolidated statement of comprehensive income consists of the Company’s net income or loss for the year, plus re-measurement gains and losses arising on defined benefit pension plans.

11.

n) Income tax

Current-year income tax is recognized as a short-term liability, net of prepayments made during the year.

Deferred income tax is recognized using the asset and liability method. Under this method, deferred taxes are recognized on all temporary differences between financial reporting and tax values of assets and liabilities, applying the enacted income tax rate or flat-rate business tax rate effective as of the statement of financial position date, or the enacted rate at the statement of financial position date that will be in effect when the temporary differences giving rise to deferred tax assets and liabilities are expected to be recovered or settled.

o) Reclassifications and other retrospective adjustments

The following balances in the consolidated statement of financial position at December 31, 2012, have been retrospectively adjusted to conform to the presentation as of December 31, 2013:



	2012, as previously reported	Reclassifications and other retrospective adjustments		2012, as adjusted
Cash and cash equivalents	Ps. 441,430	(15,018	)	Ps. 426,412
Debt securities at fair value through profit or loss	—	15,018		15,018
Accrued liabilities and other taxes payable	57,409	83,681		141,090
Provisions	87,647	(87,647	)	—
Advances from customer		3,966		3,966

The following amounts in the consolidated statements of cash flows for the years ended December 31, 2012 have been retrospectively adjusted to conform to the presentation for the year ended December 31, 2013:



	2012, As previously Reported		Reclassifications and other retrospective adjustments		2012, as adjusted
Finance income	Ps. ---		Ps. (24,234)		Ps. (24,234)
Interest received	Ps. ---		Ps. 24,234		Ps. 24,234
Debt securities at fair value through profit or loss	—		89		89
Trade receivables	6,825		(2,593	)	4,232
Accrued liabilities and other taxes payable	14,318		10,892		25,210
Income tax paid	(128,472	)	(3,029	)	(131,501	)
Advances from customers			2,593		2,593
Provisions	7,046		(7,046	)	—
Employee retirement benefits	374		(748	)	(374	)
Dividends paid in the year	(317,668	)	(69	)	(317,737	)
Cash and cash equivalents at beginning of year	339,489		(15,107	)	324,382
Cash and cash equivalents at end of year	441,430		(15,018	)	426,412

12.

p) New accounting pronouncements and changes in tax regulations

Effective January 1, 2013 the Company applied, for the first time, certain standards and amendments that require restatement of previous financial statements. These include IFRS 10 Consolidated Financial Statements, IFRS 11 Joint Arrangements, IAS 19 Employee Benefits (Revised 2011), IFRS 13 Fair Value Measurement and amendments to IAS 1 Presentation of Financial Statements.

IFRS 10 Consolidated Financial Statements, IAS 27 Separate Financial Statements

IFRS 10 replaced the portion of IAS 27 Consolidated and Separate Financial Statements that addresses the accounting for consolidated financial statements. It also addresses the issues raised in SIC-12 Consolidation - Special Purpose Entities.

IFRS 10 establishes a single control model that applies to all entities including special purpose entities. The changes introduced by IFRS 10 require management to exercise significant judgment to determine which entities are controlled and therefore are required to be consolidated by a parent, compared with the requirements that were in IAS 27.

IFRS 11 Joint Arrangements

IFRS 11 replaced IAS 31 Interests in Joint Ventures and SIC-13 Jointly-controlled Entities - Non-monetary Contributions by Venturers. IFRS 11 removes the option to account for jointly controlled entities (JCEs) using proportionate consolidation. Instead, JCEs that meet the definition of a joint venture must be accounted for using the equity method.

In addition, the application of IFRS 12 Disclosure of Interests in Other Entities resulted in additional disclosures in the consolidated financial statements. However, the adoption of IFRS 10 and IFRS 11 did not impact the annual consolidated financial statements of the Company, except for IAS 19 and the Company’s corresponding adoption was described in the Note 2k above.

IFRS 13 Fair value measurement

IFRS 13 establishes a single source of guidance under IFRS for all fair value measurements. FRS 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS. IFRS 13 defines fair value as an exit price. IFRS 13 also requires additional disclosures. The Company’s adoption of IFRS 13 did not materially impact the Company’s fair value measurements or disclosures.

Following is a list of International Financial Reporting Standards applicable to the Company that become effective on January 1, 2014. The Company intends to adopt these new standards when they become effective and has yet to evaluate the impact on its financial information.

13.

IFRS 9 Financial Instruments

IFRS 9, as issued, reflects the first phase of the IASB’s work on the replacement of IAS 39 and applies to classification and measurement of financial assets and financial liabilities as defined in IAS 39. The standard was initially effective for annual periods beginning on or after January 1, 2013, but Amendments to IFRS 9 Mandatory Effective Date of IFRS 9 and Transition Disclosures, issued in December 2011, moved the mandatory effective date to January 1, 2015. In subsequent phases, the IASB is addressing hedge accounting and impairment of financial assets.

IAS 32 Offsetting financial assets and financial liabilities

These amendments clarify the meaning of “currently has a legally enforceable right to set-off” and the criteria for non-simultaneous settlement mechanisms of clearing houses to qualify for offsetting. These are effective for annual periods beginning on or after January 1, 2014.

IFRS 15 Revenue from contracts with customers

IFRS 15, establishes a new model of revenue recognition, which requires entities to make more estimates and judgment than under current standards; under the new model entities should perform the following in order to recognize revenue: i) Identify the contract(s) with a customer, ii) Identify the separate performance obligations in the contract, iii) determine the transaction price, iv) allocate the transaction price to the separate performance obligations and v) recognize revenue when (or as) each performance obligation is satisfied. IFRS 15 is effective for annual periods beginning in January 1, 2017.


•	Approval of the tax reform in force as of January 1, 2014

On October 31, 2013, the tax reform was published in the Official Gazette. This tax reform includes the repeal of the Flat-rate Business Tax Law, the elimination of the tax on cash deposits, and changes in the Income Tax Law. The principal changes contained in the tax reform that are applicable to the Company are as follows:

b) Dividends paid from the Net taxed profits account (CUFIN) to foreign individuals or corporations from earnings generated as of January 1, 2014 shall be subject to a 10% tax withholding. Dividends not paid from the CUFIN shall continue to be subject to income tax payable by the entity at the rate of 30%.

c) Deductions of payroll-related expenses that are tax exempt for employees will be capped at 47% of the expense and 53% under certain circumstances.

d) Employee profit sharing is to be computed on an entity’s taxable earnings for the year, plus or minus the effects of certain adjustments specified in the Income Tax Law. Payroll-related expenses that are tax exempt for employees shall be deductible in full, but the deduction of employee profit sharing paid during the year will no longer be allowed. Employee profit sharing will continue to be computed at the rate of 10%.

14.

The Company’s management determined that the new tax rules will not have a material effect on the Company’s consolidated financial statements.

3. Cash and Cash Equivalents

An analysis of this caption at December 31, 2013 and 2012 is as follows:



	At December 31
	2013	2012
Cash and cash in banks	Ps. 13,830	Ps. 9,200
Cash equivalents:
Security repurchase agreements (a)	456,137	417,212
	Ps. 469,967	Ps. 426,412

a) At December 31, 2013, these cash equivalents have original maturities of two days and generate interest based on an annual rate of 3.85% (term of two days and annual interest rate of 4.82% at December 31, 2012).

4. Related Parties

An analysis of balances due from and to related parties (shareholders) at December 31, 2013 and 2012, is as follows:



	2013	2012
Accounts receivables from shareholders (credit institutions):
Credit information services	Ps. 52,380	Ps. 52,634

Payables to technological shareholders:
Technical assistance and royalties:
Trans Union LLC	Ps. 15,901	Ps. 34,165
Trans Union Crif	3,152	2,246
Fair Isaac	—	4,653
	19,053	41,064

Other accounts payable to shareholders	4,960	1,568
	Ps. 24,013	Ps. 42,632

Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the years ended December 31, 2013 and 2012, the Company has not recorded any impairment of receivables relating to amounts owed by related parties.

15.

An analysis of transactions carried out with related parties at December 31, 2013 and 2012, is as follows:



	2013	2012
Revenues:
Sale of credit reports (Shareholders - credit institutions)	Ps. 535,583	Ps. 499,316
Reimbursed expenses (a)	44,098	42,624
	Ps. 579,681	Ps. 541,940

Expenses:
Royalties (b)	Ps. 58,441	Ps. 9,493
Technical assistance	2,366	—
	Ps. 60,807	Ps. 59,493


(a)	For the years ended December 31, 2013 and 2012, reimbursed expenses relate to administrative and operating services provided to Dun & Bradstreet, S.A., Credit Bureau (this entity is considered as an affiliate because it has shareholders in common). The amount is accounted for in the Other operating revenue caption in the statements of comprehensive income.


(b)	Royalties correspond to payments made for the use and development of specialized credit reports. Primary, these payments are made to Trans Union International Inc. and Trans Union LLC and are based on specific percentages over the sale of credit reports (by type). The Agreement is for an indefinite term.

5. Property, Furniture and Equipment, net


a)	An analysis of this caption at December 31, 2013 and 2012 is as follows:



	At December 31
	2013		2012
Land	Ps. 8,642		Ps. 8,642
Buildings, adaptations and property and leasehold improvements	63,507		62,867
Computer equipment	167,391		151,358
Furniture and equipment	11,215		10,992
Communication equipment	18,944		13,974
Automotive equipment	4,524		4,624
	274,223		252,457
Accumulated depreciation	(172,731	)	(143,110	)
	Ps. 101,492		Ps. 109,347


b)	An analysis of the changes in the Company's property, furniture and equipment for the years ended December 31, 2013 and 2012 is as follows:

16.



	Balance at December 31, 2012		Additions	Retirements		Depreciation of the year		Balance at December 31, 2013
Investment
Land	Ps. 8,642							Ps. 8,642
Building, adaptations and leasehold improvements	62,867		Ps. 640					63,507
Computer equipment	151,358		17,109	Ps. (1,076)				167,391
Furniture and equipment	10,992		223	—				11,215
Communication equipment	13,974		5,640	(670	)			18,944
Automotive equipment	4,624		363	(463	)			4,524
	252,457		23,975	(2,209	)			274,223
Accumulated depreciation
Buildings, adaptations and property and leasehold improvements	Ps. (15,482)					Ps. (6,883)		Ps. (22,365)
Computer equipment	(112,732	)		Ps. 1,058		(21,190	)	(132,864	)
Furniture and equipment	(7,250	)		—		(868	)	(8,118	)
Communication equipment	(5,914	)		670		(1,846	)	(7,090	)
Automotive equipment	(1,732	)		376		(938	)	(2,294	)
	(143,110	)		2,104		(31,725	)	(172,731	)
	Ps. 109,347		Ps. 23,975	Ps. (105)		Ps. 31,725)		Ps. 101,492



	Balance at December 31, 2011		Additions	Retirements		Depreciation of the year		Balance at December 31, 2012
Investment
Land	Ps. 8,642							Ps. 8,642
Building, adaptations and leasehold improvements	56,525		Ps. 6,342					62,867
Computer equipment	134,695		16,663					151,358
Furniture and equipment	10,977		15					10,992
Communication equipment	12,047		1,927					13,974
Automotive equipment	3,556		1,617	Ps. (549)				4,624
	226,442		26,564	(549	)			252,457
Accumulated depreciation
Buildings, adaptations and property and leasehold improvements	Ps. (12,813)					Ps.(2,669)		Ps. (15,482)
Computer equipment	(94,119	)				(18,613	)	(112,732	)
Furniture and equipment	(6,322	)				(928	)	(7,250	)
Communication equipment	(4,733	)				(1,181	)	(5,914	)
Automotive equipment	(1,300	)		Ps. 433		(865	)	(1,732	)
	(119,287	)		433		(24,256	)	(143,110	)
	Ps. 107,155		Ps. 26,564	Ps. (116)		Ps.(24,256)		Ps. 109,347

The Company does not own many of its computer systems, but rather leases the use of such systems from third parties. This includes systems owned by TransUnion which are used for credit report processing purposes. The Company makes payments monthly for the use of such systems. Amounts paid to technological shareholders are disclosed in Note 4 above.

17.

6. Accrued Liabilities and Other Taxes Payable

An analysis of this caption at December 31, 2013 and 2012 is as follows:



	2013	2012
Accrued liabilities:
Suppliers and creditors	Ps. 29,143	Ps. 26,292
Employee compensation and other benefits	19,888	34,338
Consulting, legal and other fees	38,829	31,324
Maintenance and licenses	26,526	16,122
Other	1,913	5,863
	116,299	113,939
Taxes and others:
Value added tax	20,827	18,483
Social security contributions	2,763	2,492
Income tax withheld from salaries	9,224	3,615
Other taxes and withholdings	4,066	2,561
	36,880	27,151
	Ps. 153,179	Ps. 141,090

7. Equity


a)	Capital stock

The Company's capital stock is represented by 19,466,321 common registered shares, issued and outstanding, with no par value, as outlined below. The shares are divided into two series: series "A" shares (70% shares) representing fixed minimum capital, and series "B" shares (30% shares) representing the variable portion of capital stock.

Each ordinary share of the Series "A" and "B" entitles the holder to one vote at general shareholders' meetings.

In accordance with the Mexican Income Tax Law, capital contributions must be controlled in the so-called Restated contributed capital account (CUCA), which is restated for inflation. If there are capital reductions that exceed the CUCA balance, the difference will be subject to income tax payable by the Company at the tax rate in force at that time.

b) Legal reserve

In conformity with the Mexican Corporations Act, the Company is required to appropriate at least 5% of the net income of each year to increase the legal reserve. This practice must be continued until the legal reserve reaches 20% of the value of capital stock. The legal reserve at December 31, 2013 and 2012 is Ps.3,497.

18.

c) Dividends

At regular shareholders' meetings held on April 16, 2013 and April 23, 2012, respectively, the shareholders declared the following dividends:



	2013	2012
Dividends declared	Ps. 345,285	Ps. 317,737
Number of shares	19,466,321	19,466,321g
Dividend per share (pesos)	Ps. 17.74	Ps. 16.32

The Mexican Income Tax Law establishes that dividends declared from income on which corporate income tax has already been paid shall not be subject to further taxation; therefore, taxable income must be controlled in a so-called Net taxed profits account (CUFIN). Any distribution of earnings in excess of this account will be subject to corporate income tax at the tax rate in effect at that time. The afore-aforementioned dividends did not exceed the Company's CUFIN balance.

d) Tax balances

At December 31, 2013 and 2012, the Company has the following tax balances:



	2013	2012
Restated contributed capital account (CUCA)	Ps. 24,709	Ps. 23,766
Net taxed profits account (CUFIN)	497,881	437,627

8. Operating and administrative expenses

An analysis of this caption at for the years ended December 31, 2013 and 2012 is as follows:



	2013	2012
Wages and other employee benefits	Ps. 86,496	Ps. 190,071
Professional services	49,985	103,613
Royalties and licenses	107,390	107,755
Depreciation	31,725	24,256
Maintenance	17,524	13,069
Other	36,922	15,184
	Ps. 430,042	Ps. 453,948

19.

9. Income tax

Income tax

Income tax is computed considering taxable income minus authorized deductions. These items include certain inflationary effects, such as the restatement of depreciation expense and the effects of inflation on certain monetary assets and liabilities by means of the annual inflation adjustment.

For the years ended December 31, 2013 and 2012, income tax was computed by applying the 30% rate to the Company's taxable income.

Flat-rate business tax (FRBT)

In 2013 and 2012, FRBT is computed by applying the 17.5% rate to income determined on the basis of cash flows, net of authorized credits represented primarily by compensations and benefits paid to the Company's personnel.

FRBT is payable only to the extent it exceeds income tax for the same period. To determine FRBT payable, income tax paid in a given period is first subtracted from the FRBT of the same period. As mentioned in Note 2o, FRBT was repealed effectively on January 1, 2014.

For 2013 and 2012, the Company's income tax exceeded its FRBT and consequently, the Company calculated its income tax as follows:



	2013		2012
Taxable income of the Company and Subsidiary	Ps. 552,947		Ps. 534,619
Statutory income tax rate	30	%	30	%
Current year income tax	165,883		160,385
Tax prepayments	(158,636	)	(131,501	)
Income tax payable	Ps. 7,247		Ps. 28,884

An analysis of income tax charged to the statement of comprehensive income for the years ended December 31, 2013 and 2012 is as follows:



	2013		2012
Current year income tax	Ps. 165,883		Ps. 160,385
Deferred income tax	(10,328	)	(12,309	)
Other income tax items	1,518		—
	Ps. 157,073		Ps. 148,076

A reconciliation of the statutory tax rate to the effective rate recognized by the Company for the years ended December 31, 2013 and 2012 is as follows:

20.



	2013		2012
Income before income tax	Ps. 546,020		Ps. 493,270
Plus (less):
Annual tax inflation adjustment	(15,375	)	(10,947	)
Non-deductible expenses	3,155		3,828
Non-taxable income	(6,158	)	144
Other taxable income	—		6,042
Other non-taxable income	(5,383	)	—
Fixed assets and other items	1,414		1,252
Effects of change in the tax rates	(98	)	—
	523,575		493,589
Statutory income tax rate	30	%	30	%
Total current-year and deferred income tax	Ps. 157,073		Ps. 148,076
Effective income tax rate	29	%	30	%

The temporary differences in statement of financial position accounts for financial and tax reporting purposes that give rise to the deferred income tax are as follows:



	At December 31
	2013		2012
Deferred tax assets:
Accrued liabilities	Ps. 30,061		Ps. 34,077
Advances from customers	12,104		49
Employee retirement benefits	1,633		312

Property, furniture and equipment	5,795		3,662
	49,593		38,100
Deferred tax liabilities:
Prepaid expenses	(690	)	(900	)
Deferred tax asset, net	Ps. 48,903		Ps. 37,200

Reconciliation of deferred tax asset, net:



	2013	2012
Opening balance as of January 1,	Ps. 37,200	Ps. 4,891
Tax expense during the period recognized in profit or loss	10,426	12,309
Tax expense during the period recognized in OCI	1,277	—
Closing balance as at December 31,	Ps. 48,903	Ps. 7,200

The Company computed deferred income tax by applying the 30% income tax rate to the principal temporary differences between the accounting and tax values of its statement of financial position accounts, since this is the rate that the Company expects that most of the deferred income tax assets and liabilities will be materialized.

21.

10. Other Financial Assets and Liabilities

Set out below is the categorization of the financial instruments, other than cash and short-term deposits, held by the Company as at December 31, 2013 and 2012:



	December 31, 2013
	Loans and receivables	Fair value through profit or loss
Financial Assets:
Debt securities		Ps. 15,098
Trade	Ps. 44,642	—
Related parties	52,380	—
	Ps. 97,022	Ps. 15,098

Financial Liabilities:
Related parties	Ps. 24,013	Ps. ---
Accrued liabilities	121,940	—
	Ps. 145,953	Ps. ---



	December 31, 2012
	Loans and receivables	Fair value through profit or loss
Financial Assets:
Debt securities	Ps. ---	Ps. 15,018
Trade	34,967	—
Related parties	52,634	—
	Ps. 87,601	Ps. 15,018

Financial Liabilities:
Related parties	Ps. 42,632	Ps. ---
Accrued liabilities	113,939	—
	Ps. 156,571	Ps. ---

The fair value for the financial assets (excluding cash and cash equivalents) and financial liabilities shown in the consolidated statement of financial position at December 31, 2013 and 2012 is as follows:



	Measurement of fair value at December 31, 2013
	Level 1	Level 2	Level 3	Total
Assets:
Debt securities at fair value through profit or loss	Ps. 15,098	Ps.- --	Ps. ---	Ps. 15,098
Pension plan assets (government debt)	20,597	—	—	20,597
	Ps. 35,695	Ps. ---	Ps. ---	Ps. 35,695

22.



	Measurement of fair value at December 31, 2012
	Level 1	Level 2	Level 3	Total
Assets:
Debt securities at fair value through profit or loss	Ps. 15,018	Ps. ---	Ps. ---	Ps. 15,018
Pension plan assets (government debt)	19,311	—	—	19,311
	Ps. 34,329	Ps. -	Ps. ---	Ps. 34,329

For the years ended December 31, 2013 and 2012, no transfers were made between Level 1 and Level 2 fair value measurement hierarchies.

11. Commitments

The Company has entered in four operating leases of facilities for operating and administrative purposes. Such lease agreements are 1-year term and it can be extended on annual basis. Rents’ value is restated by inflation. For the period ended December 31, 2013 and 2012, the rent expense is Ps. 5,223 and Ps. 4,685, respectively.

The Company leases the use of many of the computer systems that it uses in its business. Such arrangements are typically for a period of one year or less, with prices being renegotiated at least annually. Certain amounts are paid to related parties as disclosed in Note 4. To the extent that such arrangements were not renewed in any given year on substantially similar terms, such non-renewal could have a material impact on the Company’s operations. However, as of December 31, 2013 the Company has no reason to believe that such arrangements will not be renewed for the next year under satisfactory terms.

12. Risk Management and Contingencies

- Risk management and contingencies

The Company is primarily exposed to credit, liquidity and market risks, which the Board of Directors reviews and monitors through the Corporate Practices Committee.

Credit risk

Credit risk represents the potential loss from the failure of the customer or financial instrument counterparty to meet all of its payment obligations. This risk is primarily due to cash and cash equivalents and trade receivables.

23.

The Company believes that its credit risk is limited due to the nature of its operations and the profile of its customers, which are mostly shareholders. For the years ended December 31, 2013 and 2012, the Company's accounts receivable reflect no risk of uncollectability or considerably old accounts and therefore, the Company has not recorded any allowance for bad debts. The Company’s policy is to maintain its surplus cash in demand bank deposits in Mexican banks with strong credit ratings. At December 31, 2013 and 2012, the Company has not identified any risks related to impairment or uncollectability of its cash and cash equivalents.

As at December 31 2013, and 2012, the aging analysis of trade receivables is, as follows:

Past due but not impaired

Total

Neither past due nor impaired

< 30 days

30-60 days

61-90 days

> 91days

2013

Ps. 44,642

Ps. 37,387

Ps. 2,677

Ps. 541

Ps. 265

Ps. 3,772

2012

34,967

30,990

3,467

510

—

Liquidity risk

Liquidity risk is the risk that the Company will be unable to cover its financial obligations when they mature. The Company's goal is to ensure, insofar as possible, that it always has sufficient liquidity to settle its financial liabilities when they mature, under both normal and adverse conditions, without incurring unacceptable losses or putting the entity's financial position at risk. At December 31, 2013 and 2012, the Company has no financial liabilities and management has the necessary levels of cash, cash equivalents and marketable securities in hand to meet its obligations.

Market risk

Market risk is the risk of fluctuation in market prices, such as interest rates and exchange rates.

At December 31, 2013 and 2012, the Company's foreign currency denominated position

(U.S. dollars) is considered immaterial and is USD 1,313 (short) and USD 3,446 (short), respectively. At such dates, the Company is not exposed to any material interest rate risks since it has financial liabilities and its investments in cash and cash equivalents have short-term maturities and are conducted at market rates. The Company does not carry out transactions with derivative financial instruments.

24.

Capital management

The Company’s Corporate Practices Committee monitors the liquidity risk, it establishes internal policies for capital management, and reviews the expected cash receipts and disbursements based on the approved annual budget. Historically, the Company has not required external financing for its operations (for example, bank borrowings). Such Committee also evaluates the level of operating cash flows needed in order to determine the amount of the dividends available for shareholders on annual basis.

Excessive risk concentration

Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Company’s performance to developments affecting a particular industry.

A significant component of the Company’s revenue is generated from its shareholders (61% in 2013 and 59% in 2012). During the year ended December 31, 2013, two of such shareholders each accounted for more than 10% of the Company’s consolidated revenues (2012: two shareholders). See Note 4 for further disclosure.

Besides its shareholders who also are users for the Company’s credit information services, there are no other clients having significant participation in the Company's revenues or account receivables.

- Contingencies

The Company is party to several civil lawsuits in the normal course of business. The Company, after consultation with its lawyers, believes that the ultimate resolution of such matters will not have a material impact on its consolidated financial statements.

TransUnion - FORM 10-K/A - EX-99.1 - EXHIBIT 99.1 - June 30, 2014

Attached files

TransUnion Reports