Cemex 2013 Annual Report Download - page 137

Notes to the financial statements
Statements of cash ows
The statements of cash ows present cash inows and outows in nominal pesos, excluding effects of ination and unrealized foreign
exchangeeffects.Thestatementsofcashowsexcludetransactionsthatdidnotrepresentsourcesorusesofcashsuchas:
• In2013,2012and2011,theincreasesinstockholders’equityassociatedwithdividendsinsharesthroughthecapitalizationofretained
earningsfor$5,991,$4,138and$4,216,respectively(note13A);
• In2013,2012and2011,theincreasesinstockholders’equityassociatedwiththeCPOsissuedaspartoftheexecutivestock-based
compensationfor$551,$486and$506(note13A),respectively;
• In2013,thedecreaseinothernon-currentliabilitiesforapproximately$4,325beforeadeferredtaxliabilityofapproximately$1,298,
asaresultofthechangeinthefunctionalcurrency(note2Dand10B).
2B) Use of estimates and critical assumptions
ThepreparationofnancialstatementsinaccordancewithIFRSprinciplesrequiresmanagementtomakeestimatesandassumptionsthat
affectreportedamountsofassetsandliabilitiesandthedisclosureofcontingentassetsandliabilitiesatthedateofthenancialstatements,
aswellasthereportedamountsofrevenuesandexpensesduringtheperiod.Theseassumptionsarereviewedonanongoingbasisusing
availableinformation.Actualresultscoulddifferfromtheseestimates.
Themain captionssubject toestimatesandassumptions bymanagement include,amongothers,impairment testsoflong-lived assets
andthesubsidiariesandassociatesinvestment,allowancesfordoubtfulaccounts,recognitionofdeferredincometaxassets,aswellasthe
measurementofnancialinstruments.Signicantjudgmentbymanagementisrequiredtoappropriatelyassesstheamountsoftheseassets
andliabilities.
2C) Foreign currency transactions
AccordingtoIAS21,
Theeffectsofchangesinforeignexchangerates (“IAS21”),transactionsdenominatedinforeigncurrenciesarerecorded
inthefunctionalcurrencyattheexchangeratesprevailingonthedatesoftheirexecution.Monetaryassetsandliabilitiesdenominatedin
foreigncurrenciesaretranslatedintothefunctionalcurrencyattheexchangeratesprevailingatthebalancesheetdate,andtheresulting
foreignexchangeuctuationsarerecognizedinearnings.
Themostsignicantclosingexchangeratesandtheapproximateaverageexchangeratesforbalancesheetaccountsandincomestatement
accounts,respectively,ofpesosperdollarasofDecember,312013,2012and2011,wereasfollows:
2013 2012 2011
Currency Closing Average Closing Average Closing Average
UnitedStatesDollar 13.0500 12.8500 12.8500 13.1500 13.9600 12.4800
ThepesotoU.S.dollarexchangerateusedbyCEMEX,S.A.B.deC.V.isanaverageoffreemarketratesavailabletosettleitsforeigncurrency
transactions.Nosignicantdifferencesexist,inanycase,betweentheforeignexchangeratesusedbyCEMEX,S.A.B.deC.V.andthose
exchangeratespublishedbytheMexicanCentralBank.
2D) Change in the functional currency
ConsideringtheguidanceunderIFRSsetforthbyInternationalAccountingStandard21,
TheEffectsofChangesinForeignExchangeRates 
(“IAS21”),andbasedonchangingcircumstancesonthenetmonetarypositioninforeigncurrenciesofCEMEX,S.A.B.deC.V.resultingmainly
from:a)asignicantdecreaseintaxliabilitiesdenominatedinMexicanPesos;b)asignicantincreaseinitsU.S.Dollar-denominateddebt
andothernancialobligations;andc)theincreaseinU.S.Dollar-denominatedadministrativeexpensesassociatedwiththeexternalizationof
majorbackofceactivitieswithIBM;effectiveasofJanuary1,2013,CEMEX,S.A.B.deC.V.prospectivelychangeditsfunctionalcurrency
fromtheMexicanPesototheU.S.Dollar,astheU.S.DollarwasdeterminedtobethecurrencyofCEMEX,S.A.B.deC.V.’sprimaryeconomic
environment.Moreover,thereportingcurrencyforthenancialstatementsofCEMEX,S.A.B.deC.V.continuestobetheMexicanPeso.
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