consolidated financial statements - sonda€¦ · for the years ended december 31, 2016 and 2015...

Consolidated Financial Statements

The complete financial statements of SONDA S.A., its Subsidiariesand the corresponding report by the Independent Auditors areall available to the public at the company’s headquarters (500Teatinos st, Santiago, Chile) and at the Superintendencia de Valoresy Seguros (svs).

These include: • Consolidated Financial Statements of SONDA S.A. and its Subsidiaries• Summarized Financial Statements of the Subsidiaries• Management Discussion and Analysis of the Financial Results• Report by the Independent Auditors

Additionally, this information is available in the website: www.sonda.com

Deloitte Auditores y Consultores Limitada Rosario Norte 407 Rut: 80.276.200-3 Las Condes, Santiago Chile Fono: (56) 227 297 000 Fax: (56) 223 749 177 [email protected] www.deloitte.cl

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INDEPENDENT AUDITOR'S REPORT To the Shareholders and Directors of

Sonda S.A. We have audited the accompanying consolidated financial statements of SONDA S.A. and Subsidiaries, which include the consolidated statement of financial position at December 31, 2016 and 2015, and the related consolidated statements of comprehensive income, changes in shareholders’ equity and cash flows, for the years then ended, and the related notes to the consolidated financial statements. Management’s Responsibility for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We did not audit the consolidated financial statements of Sonda Filiales Brasil S.A. and subsidiaries and Transacciones Electrónicas S.A. and subsidiaries, wholly-owned subsidiaries, which statements reflect total assets and revenues for 43.00% and 37.00%, respectively, of the corresponding consolidated amounts at December 31, 2016 (39.39% and 38.42%, respectively, at December 31, 2015). Those statements were audited by other auditors, whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for Sonda Filiales Brasil S.A. and subsidiaries and Transacciones Electrónicas S.A. and subsidiaries, is based solely on the report of the other auditors. We performed our audits in accordance with auditing standards generally accepted in Chile. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement. An audit includes performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the preparation and fair presentation of the entity's consolidated 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 do not express such opinion. An audit also includes assessing the appropriateness of the accounting policies used and the reasonableness of the significant estimates made by the Company's Management, as well as evaluating the overall presentation of the consolidated financial statements.

Independent Auditor's Report

2 SONDA S.A. Annual Report 2016

We believe that the audit evidence that we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, based on our audit, and the report of the other auditors, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of SONDA S.A. and Subsidiaries as of December 31, 2016 and 2015, and the results of their operations and their cash flows for the years then ended in accordance with International Financial Reporting Standards (IFRS). Other-matter The accompanying consolidated financial statements have been translated into English solely for the convenience of readers outside Chile. January 23, 2017 Santiago, Chile

3Consolidated Financial Statements

As of December 31, 2016 and 2015 (In thousands of Chilean pesos - ThCh$)

ASSETS Note12.31.2016 12.31.2015

ThCh$ ThCh$

CURRENT ASSETS:Cash and cash equivalents 5 64,417,339 68,392,174 Other current financial assets 6 27,090,179 1,720,248 Other current non-financial assets 18 15,184,377 14,312,281 Trade and other current receivables 7 198,640,837 232,264,414 Accounts receivable from related parties 8 3,045,248 3,089,539 Inventories 9 40,198,475 42,480,735 Current tax assets 10 37,316,824 19,877,426 Total current assets other than assets or disposal groups classified as held for sale 385,893,279 382,136,817

TOTAL CURRENT ASSETS 385,893,279 382,136,817

NON-CURRENT ASSETSOther non-current financial assets 6 8,269,741 2,906,675 Other non-current non-financial assets 18 17,804,234 8,650,347 Non-current receivables 7 24,455,534 16,560,559 Accounts receivable from related parties 8 4,331,311 3,372,317 Investments accounted for using the equity method 11 5,738,380 5,718,720 Intangible assets other than goodwill 12 31,983,027 26,948,205 Goodwill 13 242,773,334 218,735,537 Property, plant and equipment 14 133,347,129 95,433,122 Investment property 15 2,349,084 2,366,840 Deferred tax assets 17 26,228,788 19,956,471

TOTAL NON-CURRENT ASSETS 497,280,562 400,648,793

TOTAL ASSETS 883,173,841 782,785,610

Consolidated Statements of Financial Position

The accompanying notes form an integral part of these consolidated financial statements


LIABILITIES AND EQUITY Note12.31.2016 12.31.2015

ThCh$ ThCh$

CURRENT LIABILITIESOther financial liabilities 19 83,270,295 13,307,865 Trade and other current payables 21 112,219,229 119,702,755 Accounts payable to related companies 8 731,595 5,207,492 Other current provisions 22 9,523,190 7,195,441 Current tax liabilities 10 8,588,245 22,086,785 Current provisions for employee benefits 23 5,399,981 5,939,682 Other current non-financial liabilities 24 21,666,982 25,929,922 Total current liabilities other than liabilities included in disposal groups classified as held for sale 241,399,517 199,369,942

TOTAL CURRENT LIABILITIES 241,399,517 199,369,942

NON-CURRENT LIABILITIES:Other non-current financial liabilities 19 82,667,509 78,641,323 Non-current payables 21 14,336,265 16,964,770 Accounts payable to related companies, non-current 8 64,822 71,970 Other non-current provisions 22 4,420,779 2,512,630 Deferred tax liabilities 17 19,747,248 13,250,498 Non-current provisions for employee benefits 23 3,388,996 3,285,258 Other non-current non-financial liabilities 24 5,791,281 2,831,934

TOTAL NON-CURRENT LIABILITIES 130,416,900 117,558,383

TOTAL LIABILITIES 371,816,417 316,928,325

EQUITY:Issued capital 25 373,119,044 373,119,044 Retained earnings 203,348,287 190,139,970 Other reserves 25 (73,548,295) (104,240,565)Equity attributable to owners of the company 502,919,036 459,018,449 Non-controlling interests 25 8,438,388 6,838,836

TOTAL EQUITY 511,357,424 465,857,285

TOTAL LIABILITIES AND EQUITY 883,173,841 782,785,610



For the years ended December 31, 2016 and 2015 (In thousands of Chilean pesos - ThCh$)

Consolidated Statements of Comprehensive Income

Note12.31.2016 12.31.2015

ThCh$ ThCh$

GROSS PROFIT:Revenue 26 816,158,844 891,122,437 Cost of sales 30 (671,565,219) (728,349,126)GROSS PROFIT 144,593,625 162,773,311

Other income, by function 27 5,672,279 4,949,527 Administration expenses (81,292,580) (69,625,545)Other expenses, by function 29 (14,458,456) (10,474,286)Total income from continuing operations 54,514,868 87,623,007

Finance income 5,305,266 4,286,715 Finance costs (11,968,565) (8,419,941)Share of profit of associates accounted for using the equity method 11 9,630 322,846 Exchange rate differences (2,711,025) (441,926)Effect of indexed assets and liabilities 125,124 (271,623)

PROFIT BEFORE TAX 45,275,298 83,099,078

Income tax expense 17 (13,347,930) (35,554,346)PROFIT FROM CONTINUING OPERATIONS 31,927,368 47,544,732

PROFIT FROM CONTINUING OPERATIONS 31,927,368 47,544,732

PROFIT ATTRIBUTABLE TO:Owners of company 26,396,126 42,850,330 Non-controlling interests 25 5,531,242 4,694,402 PROFIT 31,927,368 47,544,732

EARNINGS PER SHAREEarnings per share - Basic Earnings per share from continuing operations - Basic (Ch$/Share) 30.30 49.19 Earnings per share - DilutedEarnings per share from continuing operations - Diluted (Ch$/Share) 30.30 49.19



TOTAL COMPREHENSIVE INCOME12.31.2016 12.31.2015

ThCh$ ThCh$

PROFIT 31,927,368 47,544,732

COMPONENTS OF OTHER COMPREHENSIVE INCOME THAT WILL NOT BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS BEFORE TAX Other comprehensive income before tax actuarial gains (losses) on defined benefit plans 19,611 (38,422)

Other comprehensive income that will not be reclassified subsequently to profit or loss, before tax 19,611 (38,422)

OTHER COMPREHENSIVE INCOME THAT WILL BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS, BEFORE TAX Exchange differences on translation Gains (losses) on exchange differences on translation before tax 27,370,742 (59,013,870)Cash flow hedgeGains (losses) (1,238,020) -

Other comprehensive income that will be reclassified subsequently to profit or loss, before tax 26,132,722 (59,013,870)

Other comprehensive income, before tax 26,152,333 (59,052,292)

Income tax relating to components of other comprehensive income that will not be reclassified subsequently to profit or loss (10,988) 9,605 Income tax relating to new measurement defined benefit plans of other comprehensive income (10,988) 9,605 Income tax relating to components of other comprehensive income that will be reclassified subsequently to profit or loss 430,861 - Income tax relating to available for sale financial assets of other comprehensive income 430,861 -

Total comprehensive income 26,572,206 (59,042,687)TOTAL COMPREHENSIVE INCOME FOR THE YEAR 58,499,574 (11,497,955)

COMPREHENSIVE INCOME ATTRIBUTABLE TO:Owners of the parent 52,968,332 (16,192,357)Non-controlling interests 5,531,242 4,694,402

TOTAL COMPREHENSIVE INCOME FOR THE YEAR 58,499,574 (11,497,955)



For the years ended December 31, 2016 and 2015 (In thousands of Chilean pesos - ThCh$)

Consolidated Statements of Cash Flows, Direct

12.31.2016 12.31.2015ThCh$ ThCh$

STATEMENTS OF CASH FLOWS

Cash flows from operating activities

Receipts from customers 958,904,307 971,723,847

Other cash receipts from operating activities 20,100,272 46,152,287

Total cash receipts from operating activities 979,004,579 1,017,876,134

Payments to suppliers (528,923,136) (538,255,230)

Payments to and on behalf of employees (280,211,507) (290,840,855)

Other cash payments from operating activities (75,614,084) (109,665,613)

Total cash payments from operating activities (884,748,727) (938,761,698)

Cash flows from (used in) operations 94,255,852 79,114,436

Income taxes paid (27,979,163) (26,365,494)

Other cash flow from operating activities 1,244,308 (1,511,007)

Net Cash generated by operating activities 67,520,997 51,237,935

Cash flows from investing activities

Cash flows from sale of non-controlling interests - 787,315

Cash flows used to acquire non-controlling interests (25,504,057) (3,387,899)

Other cash receipts from sales of equity or debt instruments of other entities 58,108 -

Other cash payments to acquire equity or debt instruments of other entities (15,892,641) -

Proceeds from sales of property, plant and equipment (23,029,633) -

Dividends received 227,938 2,301,647

Purchase of property, plant and equipment - 10,372

Loans to related parties (23,062,479) (24,423,086)

Cash receipts from related companies - (26,220)

Purchase of intangible assets (3,054,438) (1,817,741)

Other inflows of cash (13,447,038) 732,574

Cash flows from investing activities (103,704,240) (25,823,038)



12.31.2016 12.31.2015ThCh$ ThCh$

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds From Issuing Other Equity Instruments 62,962,294 -

Proceeds from long-term loans 2,000 -

Proceeds from short-term loans 132,300,717 27,085,835

Repayments of borrowings (110,987,971) (27,900,130)

Payments of finance lease liabilities (5,076,185) (3,026,387)

Dividends paid (25,757,139) (24,475,117)

Interests paid (15,322,531) (5,285,487)

Other inflows (outflows) of cash (1,844,821) 933,122

Cash flows from financing activities 36,276,364 (32,668,164)

Increase (decrease) in cash and cash equivalents before effect of exchange rate changes 93,121 (7,253,267)

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS

Effect of exchange rate changes on cash and cash equivalents (4,067,956) (2,944,673)

Increase (decrease) in cash and cash equivalents (3,974,835) (10,197,940)

Cash and cash equivalents at beginning of period 68,392,174 78,590,114

Cash and cash equivalents at end of period 64,417,339 68,392,174



Other reserves Other reserves

Issued Capital

Reserve of exchange differences on

translation

Reserve of gains and losses on remeasuring

available-for-sale financial assets financial assets

Cash flow hedging reserve

Reserve of actuarial gains or losses on

defined benefit plans Other miscellaneous

reserves Total Other reserves Retained earnings

Equity attributable to owners of the

companyNon-controlling

interests Total equityThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Equity at beginning of period 01/01/2016 373,119,044 (105,775,876) - - 221,701 1,313,610 (104,240,565) 190,139,970 459,018,449 6,838,836 465,857,285

CHANGES IN EQUITY: Comprehensive income Profit for the year - - - - - - - 26,396,126 26,396,126 5,531,242 31,927,368 Other comprehensive income - 27,370,742 - (807,159) 8,623 - 26,572,206 - 26,572,206 - 26,572,206 Comprehensive income - 27,370,742 - (807,159) 8,623 - 26,572,206 26,396,126 52,968,332 5,531,242 58,499,574

Issue of equity - - - - - - - - - - - Dividends - - - - - - - (13,198,063) (13,198,063) (3,931,690) (17,129,753)Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control - - - - - - - - - -

Increase (decrease) through transfers and other changes, equity - - 4,120,064 - - - 4,120,064 10,254 4,130,318 - 4,130,318

Changes in equity - 27,370,742 4,120,064 (807,159) 8,623 - 30,692,270 13,208,317 43,900,587 1,599,552 45,500,139

Equity at end of period 12/31/2016 373,119,044 (78,405,134) 4,120,064 (807,159) 230,324 1,313,610 (73,548,295) 203,348,287 502,919,036 8,438,388 511,357,424


Issued capital


translation






reserves Total Other reserves Retained earningsEquity attributable to

owners of parentNon-controlling



Changes in equity: Comprehensive income Profit for the year - - - - - - - 42,850,330 42,850,330 4,694,402 47,544,732 Other comprehensive income - (59,013,870) - - (28,817) - (59,042,687) - (59,042,687) - (59,042,687) Comprehensive income (59,013,870) - - (28,817) - (59,042,687) 42,850,330 (16,192,357) 4,694,402 (11,497,955)

Issue of equity - - - - - - - - - - Dividends - - - - - - - (21,425,165) (21,425,165) (3,776,054) (25,201,219)Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control - - - - - - - - - - -

Increase (decrease) through transfers and other changes, equity - - - - - - - - - - -

Changes in equity - (59,013,870) - - (28,817) - (59,042,687) 21,425,165 (37,617,522) 918,348 (36,699,174)

Equity at end of period 12/31/2015 373,119,044 (105,775,876) - - 221,701 1,313,610 (104,240,565) 190,139,970 459,018,449 6,838,836 465,857,285

As of December 31, 2016 and 2015 (In thousands of Chilean pesos - ThCh$)

Consolidated Statements of Changes in Equity




Issued Capital


translation






reserves Total Other reserves Retained earnings

Equity attributable to owners of the

companyNon-controlling



CHANGES IN EQUITY: Comprehensive income Profit for the year - - - - - - - 26,396,126 26,396,126 5,531,242 31,927,368 Other comprehensive income - 27,370,742 - (807,159) 8,623 - 26,572,206 - 26,572,206 - 26,572,206 Comprehensive income - 27,370,742 - (807,159) 8,623 - 26,572,206 26,396,126 52,968,332 5,531,242 58,499,574

Issue of equity - - - - - - - - - - - Dividends - - - - - - - (13,198,063) (13,198,063) (3,931,690) (17,129,753)Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control - - - - - - - - - -

Increase (decrease) through transfers and other changes, equity - - 4,120,064 - - - 4,120,064 10,254 4,130,318 - 4,130,318

Changes in equity - 27,370,742 4,120,064 (807,159) 8,623 - 30,692,270 13,208,317 43,900,587 1,599,552 45,500,139

Equity at end of period 12/31/2016 373,119,044 (78,405,134) 4,120,064 (807,159) 230,324 1,313,610 (73,548,295) 203,348,287 502,919,036 8,438,388 511,357,424


Issued capital


translation






reserves Total Other reserves Retained earningsEquity attributable to

owners of parentNon-controlling



Changes in equity: Comprehensive income Profit for the year - - - - - - - 42,850,330 42,850,330 4,694,402 47,544,732 Other comprehensive income - (59,013,870) - - (28,817) - (59,042,687) - (59,042,687) - (59,042,687) Comprehensive income (59,013,870) - - (28,817) - (59,042,687) 42,850,330 (16,192,357) 4,694,402 (11,497,955)

Issue of equity - - - - - - - - - - Dividends - - - - - - - (21,425,165) (21,425,165) (3,776,054) (25,201,219)Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control - - - - - - - - - - -

Increase (decrease) through transfers and other changes, equity - - - - - - - - - - -

Changes in equity - (59,013,870) - - (28,817) - (59,042,687) 21,425,165 (37,617,522) 918,348 (36,699,174)

Equity at end of period 12/31/2015 373,119,044 (105,775,876) - - 221,701 1,313,610 (104,240,565) 190,139,970 459,018,449 6,838,836 465,857,285


1. General Information 142. Description Of The Business 143. Basis Of Presentation Of The Consolidated Financial Statements And Accounting Policies Applied 17 3.1 Consolidated Financial Statements 17 a. Basis of preparation 17 b. Reporting period 17 c. Responsability for the Information and Estimates Made 17 3.2 Accounting Principles 18 a. Basis of consolidation 18 b. Business combinations 24 c. Currency 25 d. Offsetting of balances and transactions 25 e. Transactions in Foreign Currency 25 f. Intangibles 26 g. Property, Plant and Equipment 27 h. Investment Property 28 i. Revenue Recognition 28 j. Impairment of assets 28 k. Borrowing costs 30 l. Inventories 30 m. Leases 30 n. Financial instruments 31 o. Derivative financial instruments 34 p. Provisions 35 q. Income Tax and Deferred Taxes 35 r. Statement of Cash Flows 36 s. Earnings per Share 36 t. Dividends 36 u. Factoring transactions 36 v. Current and Non-Current Classification of Balances 36 w. Environment 36 3.3 Reclassifications And Accounting Changes 364. New Accounting Standards 375. Cash and Cash Equivalents 39

TABLE OF CONTENTS


6. Other Financial Assets 407. Trade And Other Receivables 408. Balances And Transactions With Related Companies 439. Inventories 4610. Current Tax Assets and Liabilities 4611. Investments Accounted for Using the Equity Method 4712. Intangible Assets other than Goodwill 4813. Goodwill 5014. Property, Plant and Equipment 5115. Investment Property 5316. Finance Lease 5417. Deferred Taxes and Income Tax Expenses 5518. Other Non-Financial Assets 5719. Other Financial Liabilities 5820. Hedging Assets and Liabilities 7021. Trade and other Payables 7022. Other Provisions 7223. Provisions for Employee Benefits 7324. Other Non-Financial Liabilities 7525. Equity 7626. Revenue 8027. Other Income 8028. Depreciation and Amortization 8029. Other Expenses by Function 8130. Cost of Sales 8131. Financial Instruments and Fair Value Measurements 8132. Financial Information by Operating Segments 8433. Contingencies and Restrictions 8734. Subsidiaries 9135. Environment 9236. Risk Analysis 9337. Foreign Currency 9438. Auditor Fees (Unaudited) 10039. Subsequent Events 100


(In thousands of Chilean pesos - ThCh$)

1. General Information

SONDA S.A. (the “Company” or “SONDA”) was initially incorporated as a limited liability partnership by means of public deed dated October 30, 1974 before Public Notary of Santiago Mr. Herman Chadwick Valdés. A summary of the public deed was registered on page 11,312 under number 6,199 of the Register of Commerce of the Commerce Registrar of Real Estate Property in Santiago in 1974, and published in the Official Gazette on December 28, 1974.

The Company became a corporation by means of public deed dated September 16, 1991 before Notary Public Mr. Humberto Quezada Moreno. The summary of the public deed was registered on page 28,201 under number 14,276 of the Register of Commerce of the Commerce Registrar of Real Estate Property in Santiago in 1991, and published in the Official Gazette on September 24, 1991.

After becoming a corporation, the Company’s by-laws have been changed several times. The Company’s current by-laws are set forth in: (i) public deed dated July 4, 2006 before Notary Public Mr. René Benavente Cash. An extract of the public deed was registered on page 27,555 under number 19,250 of the Register of Commerce of the Commerce Registrar of Real Estate Property in Santiago in 2006, and published in the Official Gazette on July 17, 2006 and (ii) public deed dated August 31, 2012 granted at the Notary of Santiago of Mr. Andrés Rubio Flores, which indicates the capital increase approved in the Extraordinary Shareholders' Meeting held on August 30, 2012, an excerpt of which was recorded at page 61,522 number 42,921 in the Register of Commerce of the Commerce Registrar of Real Estate Property in Santiago corresponding to the year 2012 and published in the Official Gazette on September 4, 2012.

SONDA S.A.’s registered address and head office is located at Teatinos 500, in Santiago, Chile.

The Company is registered in the Register of Securities under number 950. Therefore, it is supervised by the Chilean Superintendency of Securities and Insurance.

The corporate purpose of SONDA S.A. is selling computer equipment, rendering services related to data processing, development and use of

CONSOLIDATED FINANCIAL STATEMEMTS AS OF DECEMBER 31, 2016 AND 2015

software and application systems and organization and management of data processing centers.

2. Description of the Business

2.1 Main business lines of SONDA.

a. IT Services

SONDA’s offer of Services aims at generating value through the best use of hardware and software tools, as well as communications and business applications, comprising a wide range of services, among others IT outsourcing, cloud computing, projects and integration of systems, managed device services, infrastructure support and professional services. This is the line of business with the strongest growth worldwide in the IT industry and where the greatest value is added for our clients.

Full Outsourcing TI - These services support the continuity of our clients’ businesses by outsourcing all or most of IT functions; this enables them to allocate its resources in a more efficient way, takes advantage of scale economies and focuses on managing its business. It also includes, among others, full outsourcing, data center services, cloud computing, administrated services and technological infrastructure as service.

Projects and systems integration - It includes design and construction of solutions projects based on the integration of hardware and software elements, as well as communications and business applications, in addition to implementation services and eventually operation. The services may include integration projects in functional areas of a company or organization and also high impact public initiatives carried out by the intensive use of IT.

Managed Device Services - SONDA provides infrastructure as service, including PCs, tablets, printers, routers, switches and management of mobile devices at entrepreneurial level (BYOD). This service allows turning CAPEX into OPEX releasing capital that can be destined to the business core of our clients, in addition to assigning the management of all devices to a specialist.


Infrastructure support - This aims at supporting the hardware, software and communications infrastructure by using the best practices of the industry with wide regional geographic coverage. These services include the installation, operation, updating and maintenance of hardware and software platforms and location and problems-solving resolution services implemented through help desks, technical assistance and TI assets management.

Datacenter y cloud computing – SONDA’s Datacenter and Cloud Computing Services have been designed to help clients to manage the IT risk and to maximize their performance through a set of services based on 3 fundamental pillars, security, availability and performance, to host, monitor, manage, exploit, operate and maintain servers, communication equipment, data storage, basic software and applications, ensuring the operating continuity and the security of the information, offering both physical and virtual security that can be escalated for clients to be able to implement their applications in a fast and efficient way according to their needs. Cloud Computing services are implemented on Vblock platforms, especially designed and built for large scale cloud computing and virtualization by Cisco, VMWare and EMC.

Sonda also has Tier III certified data centers in Santiago and Sao Paulo and NOC's (Network Operation Center) in Santiago, Mexico and Sao Paulo, which allow us ensuring the quality, safety and availability of the services provided by these datacenter, which are among the most reliable and modern in Latin America.

Professional and Consulting Services - These services cover several spheres of activity from strategic consulting services to align IT with the clients’ business strategies to proposing particular improvements in operating or administrative processes or a better use of IT. These services include IT scanning, data bases, operating systems, information security, infrastructure’s architecture and communication solutions.

b. Applications

SONDA’s offer of Applications is composed of a wide set of own and third parties tools, allowing to systematize and automate our clients business processes, whether from an office, desk or mobile platform, thus ensuring that the business key information is managed in an expedient, reliable and secure way.

SONDA’s offer is prepared to take care of the needs of all sectors of the economic activity, among which the financial social security, building, manufacture, retail services, basic services, mining, energy, natural resources, government, public institutions, transportation and health.

Additionally, we have a large portfolio of cross market solution to address cross needs of all industries. Among these, the following should be pointed out: Asset Management, Foreign Trade, ERP, CRM, BI, Logistics, Tax Management and BPM.

SONDA offers several delivery modalities, according to the specific preferences of its clients, the existing infrastructure and the agreements for service levels already committed. This way, the range of options goes from a traditional on-site implementation project through the provision of software as service.

c. Platforms

This includes the provision of the different elements of computing infrastructure, both hardware and software. Among the products provided by platforms, the following can be counted: servers, work stations, tablets, PCs, printer, storage and back-up equipment, communication equipment and base software (databases, operating systems and others). The sale of these technological elements can include the provision of additional elements as the implementation, maintenance and management of assets guarantees.

We keep agreements with the main manufacturers of the industry and have a team of specialized professionals to provide the most proper solutions to our client’s needs. These agreements allow us to ensure the provision of technology always with the highest quality standard. Our independence from providers, in turn, allows us to advise our clients in such a reliable way to ensure them we are recommending the right platform for each case.

2.2 Other information to be disclosed about the business (Unaudited).

a. Information to be disclosed about the nature of the business

SONDA provides services and solutions based on information technology for large and medium-sized companies and entities. SONDA is a multi-brand integrator, as it works with world-class manufacturers, and has business agreements and alliances that allow it to ensure high quality services. The range of solutions and services cover almost all of the technological needs of our customers, being able to meet their needs throughout the value chain.

The main services and products offered are:

• Development, internally or through third parties, information systems and data processing and, in general, information technology, automation and communications activities;

• Creation, production, development, application, import, export, selling, maintenance, update, operation, installation and representation of hardware, software and related services;

• Purchase, sale, import, export, representation, distribution and, in general, the selling of computer and data processing equipment, spare parts, parts, supplies, accessories and other related items;

• The direct exploitation of the same goods, either by providing services, rental or any other form;

• Training and coaching, particularly in areas of automation and information technology, through courses, seminars, conferences,


publications, events or other forms of systematic transfer of knowledge and technology;

• Organizational and business management advisory, market research and feasibility studies and operational research;

• Developing any other information technology and computing related activities or directly or indirectly related to them.

b. Information to be disclosed on management`s goals and its strategies to achieve those goals

SONDA's corporate management, established in Santiago de Chile, is responsible for defining and ensuring proper implementation of strategies aimed at strengthening the competitive position of SONDA in the IT industry in Latin America, taking advantage of growth opportunities and maximizing value for shareholders.

Meanwhile, the managers from subsidiaries in Chile and Latin America, have specific goals for each unit, which in most cases are related to the compliance of the goals set out in the annual work plans. This approach allows the organization to operate in a flexible and agile manner while maintaining efficient internal control mechanisms and ensuring proper execution of the business strategy defined by corporate management.

Additionally, there are corporate functions, such as products and alliances, human resources, marketing, business development, finance and management control, which guide the work of the subsidiaries in these areas, allowing to have uniform policies and guidelines, and at the same time assuming the specific realities of each country.

c. Information to be disclosed regarding the most significant resources, risks and relationships of the entity

In SONDA, the main resource are the nearly 18 thousand people who are part of the organization. Also, there is an experienced board of directors, a robust corporate governance, management and qualified personnel, mostly consisting of professionals and technicians who were born, grown and developed in Latin America, with extensive experience in both the use of IT as in different industries and realities of the region.

SONDA maintains insurances for all its companies in Chile and abroad, covering the risks that may affect their assets: hardware, infrastructure, buildings and contents, with a special emphasis on those concepts whose damages could have a significant impact on the economic and financial results of the Company. The policy in this regard is to combine low cost premiums with high risk coverage.

The sectorial and regional wide diversification of the customer base of SONDA, achieved through sustained growth over time, allows to significantly reduce the volatility of revenues and the dependence on a small group of customers.

On the other hand, the suppliers are worldwide leading brands of IT products and devices, with whom the Company have had long-standing business alliances. None of these alliances enforces SONDA to conduct business exclusively with the suppliers, therefore, there is no significant dependence on them.

d. Information to be disclosed on results of operations and perspectives

IDC’s projections (International Data Corporation) for 2017 aim at a 6.3% growth for total investment in Latin America. This way, the total investment in the region would reach US$53,813 million. Long-term estimates project a compound annual growth rate (CAGR) of 6.7% for IT investment in Latin America for the 2016-2020 period.

At business segment level, a 7.9% CAGR is projected for IT services for the 2016-2020 period, 4.19% for hardware and 6.10% for software. At Latin American countries level, growth projections for IT services are 6.7% for Brazil, 9.5% for Mexico, 7.6% for Chile and 6.1% for Colombia.

e. Information to be disclosed on key performance measures and indicators that management uses to evaluate the performance of the company with respect to the objectives established

Company management is evaluated based on the fulfillment of the annual operating plan approved by the Board. The most significant metrics relate to compliance with revenue levels, margins, profit and creation of new business. The business units’ executives of the Company are evaluated based on the performance of their own annual work plans by using metrics similar to those previously described. Key management is evaluated based on their contribution to the process of value creation.

2.3 Regional Coverage

SONDA has a wide service network in 10 countries, and nearly 18 thousand employees. SONDA is among the 50 most globalized companies in Latin America and provide services in more than 3000 cities.


3. Basis Of Presentation of the Consolidated Financial Statements and Accounting Policies Applied

3.1 Consolidated Financial Statements a. Basis of preparation

The Consolidated Financial Statements of the Company for the year ended December 31, 2016 has been prepared in accordance with International Financial Reporting Standards (IFRS), issues by International Accounting Standards Board (hereinafter IASB).

The consolidated Financial Statements of the Company for the year ended December 31, 2015, were originally prepared in accordance with instructions and standards of the Superintendence of Securities and Insurance (hereinafter SVS), which consider the International Financial Reporting Standards (IFRS), and specific instructions issued by SVS. These instructions directly relate to Directive Release N° 856 issued by the SVS on October 17, 2014, which instructed the audited entities to directly record under equity the variations in assets and liabilities for deferred taxes arising as the direct result of the increase in the first category tax rate introduced in Chile by Law 20,780. This instruction differs from that stated by the International Financial Reporting Standards (IFRS) requiring said effect to be recorded against results of the year. The effect of this change on the accounting bases meant to recognize a charge to accrued income in 2014 for the amount of Th$846,543, which according to IFRS should have been recorded with charge to income for said year.

In adopting the IFRS, the Company has applied these rules as it had never quit applying them according to the option stated in paragraph 4A of IFRS 1 “First-time adoption of International Financial Reporting Standards. This re-adoption of IFRS did not involve adjustments to the consolidated financial statements as of December 31, 2015 originally issued.

These consolidated financial statements have been prepared from the accounting records kept by the parent company and the other entities that are part of the consolidated group. Each entity prepares its financial statements in accordance with the accounting principles and policies of each country. Consequently, the consolidation process has included adjustments and reclassifications required to uniform principles and policies for them to be in conformity with the Superintendence of Securities and Insurance instructions and standards.

The consolidated financial statements have been prepared on the historical cost basis except for certain financial instruments that are measured at revalued amounts or fair value at the end of each reporting

period, as explained in the accounting policies below. Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.

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, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the company takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these consolidated financial statements is determined on such a basis, except for:

i) share-based payment transactions that are within the scope of IFRS 2ii) lease transactions that are within the scope of IAS 17 andiii) measurements that have some similarities to fair value (but are not fair

value, such as net realizable value in IAS 2 or value in use in IAS 36).

In assessing value in use, the Company prepares projections of future pre-tax cash flows based on the most recent available budgets. These budgets include the best estimates of management on the revenues and costs for the cash-generating units based on industry projections, past experience and future expectations.

b. Accounting period

The consolidated financial statements cover the following periods:

• Statements of financial position as of December 31, 2016 and 2015.• Statements of changes in equity for the years ended December 31,

2016 and 2015.• Statements of comprehensive income for the years ended December

31, 2016 and 2015.• Statement of cash flows (direct method) for the years ended

December 31, 2016 and 2015.

c. Responsibility for the Information and Estimates Made

The Board of Directors of SONDA S.A. is aware of the information included in these consolidated financial statements and has stated that its responsible for the reliability of the information included in these consolidated financial statements, and the application of the principles and criteria as issued by the International Accounting Standards Board (IASB).

These consolidated financial statement were approved by the Board of Directors at meeting held on January 23, 2017.


In preparing these consolidated financial statements the Company’s management has made certain estimates in order to measure some of the assets, liabilities, income, expenses and commitments recorded therein, including:

• Useful lives of property, plant and equipment and intangible assets• Valuation of assets and goodwill • Evaluation of Impairment of assets• Assumptions used in the actuarial calculation of employees’ severance

indemnities and other long-term benefits• Assumptions used in the fair value measurement of financial

instruments• Revenue from unbilled services rendered (Revenue recognition)• Provisions for commitments with third parties• Risks derived from current litigations

The main estimates are basically referred to:

(i) Impairment of Assets: The Company, in accordance with IAS 36, reviews the carrying amount of its tangible and intangible assets to determine whether there is any indication that the carrying amount cannot be recoverable. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. In testing for impairment, those assets that do not generate independent cash flows are grouped in a cash-generating unit (CGU) to which the asset belongs. The recoverable amount of these assets or CGU is measured as the higher of their fair value less costs to sell and their value in use.

Irrespective of whether there is any indication that impairment exists, the Company tests goodwill acquired in a business combination for impairment annually in accordance with IAS 36.

Management necessarily applies its judgment in the group of assets that do not generate independent cash flows and also in estimating the timing and value of underlying cash flow in the calculation values. In assessing value in use, the Company prepares projections of future cash flows before taxes based on the most recent available budgets. These budgets include the best estimates of management on the revenues and costs of the cash-generating units based on industry projections, past experience and future expectations. Subsequent changes in grouping CGUs or periodicity of cash flows could impact the carrying amounts of the respective assets.

In the case of financial assets that have a commercial origin, the Company

has defined a policy to record provisions for impairment based on past-due uncollectible amounts, which are calculated based on an analysis of aging and historical collection.

(ii) Business combinations: In a business acquisition, an independent valuation expert is used to make a determination of fair value of net assets acquired and the identification of intangible assets. In measuring fair value of intangibles identified in a business combination are used cash flow projections based on yield estimates of the acquired businesses.

(iii)Intangibles: The Company has internally developed software applications that it considers will be available for its customers. Some of these products require on-going updates for the purpose of keeping them technologically viable. In developing and updating these products, the Company incurs engineering costs, which are capitalized and amortized over the period in which the benefits associated with these costs are considered to be recovered, taking into consideration their technological obsolescence (See Note 3.2 f).

(iv)Revenue Recognition: Revenue is recognized (including the development of software) in accordance with the percentage of completion method. This method requires that the progress of the project be estimated by comparing costs incurred at a particular date with total estimated costs. Total estimated costs are accumulated by using assumptions related to the period of time required to complete the project, prices and availability of supplies, and salaries to be incurred. Unforeseen circumstances may extend the life of the project or the costs to be incurred. The basis of calculation of the stage of completion may change, which would affect the rate or the period of time over which the revenue from the projects is recognized.

(v) Probability of Occurrence and Amount of Liabilities of Uncertain Amount or Contingent. These estimates have been made based on the information available at the reporting date of these financial statement; however, it is possible that future events may occur that would require a change (upwards or downwards) to these estimates in subsequent periods. This change would be made prospectively, recognizing the effects in the corresponding future consolidated financial statements.

3.2 Accounting Principles

a. Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiaries). Control is achieved when the Company:

- has power over the investee (existing rights that give it the ability to direct the relevant activities of the investee, i.e., the activities that significantly affect the investee's returns);


- is exposed, or has rights, to variable returns from its involvement with the investee; and

- has the ability to use its power to affect its returns.

When the Company has less than a majority of the voting rights of an investee, it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The Company considers all relevant facts and circumstances in assessing whether or not the Company’s voting rights in an investee are sufficient to give it power, including:

- the size of the Company’s holding of voting rights relative to the size and dispersion of holdings of the other vote holders

- potential voting rights held by the Company, other vote holders or other parties

- rights arising from other contractual arrangements; and- any additional facts and circumstances that indicate that the

Company has, or does not have, the current ability to direct the relevant activities at the time that decisions need to be made, including voting patterns at previous shareholders’ meetings.

The Company will reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes in one or more of the three elements mentioned above control.

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of profit or loss and other comprehensive income from the date the Company gains control until the date when the Company ceases to control the subsidiary.

Profit or loss and each component of other comprehensive income are attributed to the owners of the Company and to the non-controlling interests. Total comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

If a subsidiary uses accounting policies other than those adopted in the consolidated financial statements for transactions and other similar events in similar circumstances, appropriate adjustments shall be made in the financial statements of the subsidiaries in preparing the consolidated financial statements to ensure consistency with SONDA’s accounting policies.

All balances and transactions between related companies have been fully eliminated in consolidation. Non-controlling interests - A parent company shall present non-controlling interests in the consolidated statement of financial position within equity, separately from the equity of the owners of the parent.

Changes in the Company’s ownership interests in existing subsidiaries

Changes in the Company’s ownership interests in subsidiaries that do not result in the Company losing control over the subsidiaries are accounted for as equity transactions. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to owners of the Company. No adjustment is made in the carrying amount of goodwill or gains or losses are recognized in the income statement.

When the Company loses control of a subsidiary, a gain or loss is recognized in profit or loss and is calculated as the difference between (i) the aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling interests. All amounts previously recognized in other comprehensive income in relation to that subsidiary are accounted for as if the Company had directly disposed of the related assets or liabilities of the subsidiary (i.e. reclassified to profit or loss or transferred to another category of equity as specified/permitted by applicable IFRSs). The fair value of any investment retained in the former subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under IAS 39, when applicable, the cost on initial recognition of an investment in an associate or a joint venture.

Associates and joint ventures - An associate is an entity over which the Company has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. The results and assets and liabilities of associates are incorporated in these consolidated financial statements using the equity method of accounting, except when the investment, is classified as held for sale, in which case it is accounted for in accordance with IFRS 5. Under the equity method, an investment in an associate is initially recognized in the consolidated statement of financial position at cost and adjusted thereafter to recognize the Group’s share of the profit or loss and other comprehensive income of the associate.


When the Company share of losses of an associate or a joint venture exceeds the Group’s interest in that associate or joint venture, the Company discontinues recognizing its share of further losses. Interest in an associate or joint venture shall be the carrying amount of the investment in the associate or joint venture, determined in accordance with to the equity method, together with any long-term interest that, in essence, forms part of the entity’s net investment in the associate or joint venture.

A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control.

An investment in an associate or a joint venture is accounted for using the equity method from the date on which the investee becomes an associate or a joint venture. On acquisition of the investment in an associate or a joint venture, any excess of the cost of the investment over the Company’s share of the net fair value of the identifiable assets and liabilities of the investee is recognized as goodwill, which is included within the carrying amount of the investment. Any excess of the Company’s share of the net fair value of the identifiable assets and liabilities over the cost of the investment, after reassessment, is recognized immediately in profit or loss in the period in which the investment is acquired.

The requirements of IAS 39 are applied to determine whether it is necessary to recognize any impairment loss with respect to the Group’s investment in an associate or a joint venture. When necessary, the entire carrying amount of the investment (including goodwill) is tested for impairment in accordance with IAS 36 Impairment of Assets as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs of disposal) with its carrying amount, Any impairment loss recognized forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognized in accordance with IAS 36 to the extent that the recoverable amount of the investment subsequently increases.

The Company discontinues the use of the equity method from the date when the investment ceases to be an associate or a joint venture, or when the investment is classified as held for sale.

When the Company retains an interest in the former associate or joint venture and the retained interest is a financial asset, the Company measures the retained interest at fair value at that date and the fair value is regarded as its fair value on initial recognition in accordance with IAS 39.

The difference between the carrying amount of the associate or joint venture at the date the equity method was discontinued, and the fair value of any retained interest and any proceeds from disposing of a part interest in the associate or joint venture is included in the determination of the gain or loss on disposal of the associate or joint venture. In addition, the Company accounts for all amounts previously recognized in other comprehensive income in relation to that associate or joint venture on the same basis as would be required if that associate or joint venture had directly disposed of the related assets or liabilities.

The company continues to use the equity method when an investment in an associate becomes an investment in a joint venture or an investment in a joint venture becomes an investment in an associate. There is no re-measurement to fair value upon such changes in ownership interests.

When the Company reduces its ownership interest in an associate or a joint venture and the Company continues to use the equity method, the Company reclassifies to profit or loss the proportion of the gain or loss that had previously been recognized in other comprehensive income relating to that reduction in ownership interest if that gain or loss would be reclassified to profit or loss on the disposal of the related assets or liabilities.

When a company belonging to the group conducts transactions with an associate or a joint venture, profits and losses resulting from such transactions with the associate or the joint venture are recognized in the company’s consolidated financial statements only to the extent of the interest in the associate or joint venture.

The subsidiaries included in the consolidation are as follows:


Taxpayer Number Company Name Country Functional Currency

12.31.2016 12.31.2015Ownership Percentage

direct

Ownership Percentage

indirect

Total Ownership Percentage

Non controlling interest


direct


indirect

Total Ownership Percentage

Non controlling interest

76111.649-6 3 GENESIS S.A. Chile Chilean pesos 0.000000 41.389920 41.389920 58.610080 0.000000 41.389920 41.389920 58.610080

Foreign ARAUCANIA PARTICIPACOES LTDA. (2) (8) Brazil Brazilian reais 0.000000 0.000000 0.000000 0.000000 0.000000 100.000000 100.000000 0.000000

96.916.540-6 BAZUCA INTERNET PARTNERS S.A. Chile Chilean pesos 0.006000 99.876668 99.882668 0.117332 0.006000 99.876668 99.882668 0.117332 Foreign CTIS TECNOLOGÍA S.A.(4) Brazil Brazilian reais 0.000000 100.000000 100.000000 0.000000 0.000000 100.000000 100.000000 0.000000 Foreign ELUCID SOLUTIONS S.A. Brazil Brazilian reais 0.000000 100.000000 100.000000 0.000000 0.000000 100.000000 100.000000 0.000000 96.803.810-9 FACTORING GENERAL S.A. Chile Chilean pesos 1.000000 99.000000 100.000000 0.000000 1.000000 99.000000 100.000000 0.000000

Foreign INGENIERIA SERVICIOS INFORMATICOS S.A. DE C.V. Mexico Mexican peso 0.000000 100.000000 100.000000 0.000000 0.000000 100.000000 100.000000 0.000000

76.240.462-1 INMOBILIARIA SERVIBANCA S.A. Chile Chilean pesos 0.000000 86.750000 86.750000 13.250000 0.000000 86.750000 86.750000 13.250000

78.936.330-7 INNOVACIÓN Y TECNOLOGÍA EMPRESARIAL ITEM LTDA. Chile Chilean pesos 0.000000 99.810210 99.810210 0.189790 0.000000 99.810210 99.810210 0.189790

Foreign INVERSIONES QUINTEC COLOMBIA LTDA. Colombia Colombian peso 0.000000 99.810210 99.810210 0.189790 0.000000 99.810210 99.810210 0.189790 88.579.800-4 MICROGEO S.A. Y FILIAL Chile US dollars 0.000000 80.000000 80.000000 20.000000 0.000000 80.000000 80.000000 20.000000 Foreign NEXTIRA ONE MEXICO S.A. (7) Mexico US dollars 0.000000 0.000000 0.000000 0.000000 0.000000 100.000000 100.000000 0.000000 Foreign NOVIS MÉXICO S.A. México Mexican peso 0.000000 60.000000 60.000000 40.000000 0.000000 60.000000 60.000000 40.000000 96.967.100-K NOVIS S.A. Chile Chilean pesos 0.000000 60.000000 60.000000 40.000000 0.000000 60.000000 60.000000 40.000000 94.071.000-6 ORDEN S.A. Chile Chilean pesos 4.324000 95.676000 100.000000 0.000000 4.324000 95.676000 100.000000 0.000000

Foreign PARS PRODUTOS DE PROCESSAMENTO DE DADOS LTDA. (12) Brazil Brazilian reais 0.000000 100.000000 100.000000 0.000000 0.000000 100.000000 100.000000 0.000000

Foreign QUINTEC ARGENTINA S.A. Argentina Argentinean peso 0.000000 99.810219 99.810219 0.189781 0.000000 99.810219 99.810219 0.189781

Foreign QUINTEC BRASIL SERV.DE INFORMATICA LTDA. (3) Brazil Brazilian reais 0.000000 100.000000 100.000000 0.000000 0.000000 100.000000 100.000000 0.000000

86.731.200-5 QUINTEC CHILE S.A. Chile Chilean pesos 0.000000 99.810590 99.810590 0.189410 0.000000 99.810590 99.810590 0.189410 Foreign QUINTEC COLOMBIA S.A.S (6) Colombia Colombian peso 0.000000 0.000000 0.000000 0.000000 0.000000 99.999970 99.999970 0.000030 96.723.760-4 QUINTEC DISTRIBUCION S.A. Chile Chilean pesos 0.000000 99.810229 99.810229 0.189771 0.000000 99.810229 99.810229 0.189771 76.376.955-0 QUINTEC FILIALES OPERATIVAS S.A. Chile Chilean pesos 0.000000 99.810210 99.810210 0.189790 0.000000 99.810210 99.810210 0.189790

76.656.910-2 QUINTEC INVERSIONES LATINOAMERICANAS S.A. (3) Chile Chilean pesos 0.000000 99.810210 99.810210 0.189790 0.000000 99.810210 99.810210 0.189790

Foreign QUINTEC SAC (PERU) Perú Peruvian sol 0.000000 99.810210 99.810210 0.189790 0.000000 99.810210 99.810210 0.189790 96.515.590-2 QUINTEC SERVICIOS DE VALOR S.A. Chile Chilean pesos 0.000000 99.810400 99.810400 0.189600 0.000000 99.810400 99.810400 0.189600 96.571.690-4 SERVIBANCA S.A. Chile Chilean pesos 0.000000 86.750000 86.750000 13.250000 0.000000 86.750000 86.750000 13.250000 78.072.130-8 SERVICIOS EDUCACIONALES SONDA S.A. Chile Chilean pesos 0.674000 99.326000 100.000000 0.000000 0.674000 99.326000 100.000000 0.000000 99.551.120-7 SERVICIOS FINANCIEROS UNO S.A. Chile Chilean pesos 0.000000 99.810590 99.810590 0.189410 0.000000 99.810590 99.810590 0.189410 76.903.990-2 SOC. PROD. Y SERV. REDES MOVILES S.A. Chile Chilean pesos 0.000000 67.000000 67.000000 33.000000 0.000000 67.000000 67.000000 33.000000 96.725.400-2 SOLUCIONES EXPERTAS S.A. Y FILIAL Chile Chilean pesos 0.000000 50.000200 50.000200 49.999800 0.000000 50.000200 50.000200 49.999800 Foreign SONDA ARGENTINA S.A. Argentina Argentinean peso 5.256100 94.743600 99.999700 0.000300 5.256100 94.743600 99.999700 0.000300 Foreign SONDA COLOMBIA S.A. (6) Colombia Colombian peso 4.981380 95.018620 100.000000 0.000000 4.981380 95.018620 100.000000 0.000000 Foreign SONDA DEL ECUADOR ECUASONDA S.A. Ecuador US dollars 0.000008 99.999990 99.999998 0.000002 0.000008 99.999990 99.999998 0.000002 Foreign SONDA DEL PERU S.A. Perú Peruvian sol 0.000000 100.000000 100.000000 0.000000 0.000000 100.000000 100.000000 0.000000 Foreign SONDA DO BRASIL S.A. Brazil Brazilian reias 0.000000 99.999995 99.999995 0.000005 0.000000 99.999995 99.999995 0.000005 76.041.219-8 SONDA FILIALES BRASIL S.A. (2) Chile Chilean pesos 99.999000 0.001000 100.000000 0.000000 99.999000 0.001000 100.000000 0.000000 76.039.505-6 SONDA FILIALES CHILE LTDA. Chile Chilean pesos 99.995000 0.005000 100.000000 0.000000 99.995000 0.005000 100.000000 0.000000 96.987.400-8 SONDA INMOBILIARIA S.A. Chile Chilean pesos 0.000100 99.999900 100.000000 0.000000 0.000100 99.999900 100.000000 0.000000 Foreign SONDA MEXICO S.A. DE C.V. (5) (7) Mexico US dollars 50.104200 49.895800 100.000000 0.000000 50.104200 49.895800 100.000000 0.000000 Foreign SONDA PANAMA S.A. Panamá US dollars 0.000000 100.000000 100.000000 0.000000 0.000000 100.000000 100.000000 0.000000

Foreign SONDA PROCWORK INF. LTDA. Y FILIALES (3) Brazil Brazilian reias 0.000000 100.000000 100.000000 0.000000 0.000000 100.000000 100.000000 0.000000

76.030.421-2 SONDA REGIONAL S.A. Chile Chilean pesos 99.999997 0.000003 100.000000 0.000000 99.999997 0.000003 100.000000 0.000000 99.546.560-4 SONDA SERVICIOS PROFESIONALES S.A. Chile Chilean pesos 0.077000 99.923000 100.000000 0.000000 0.077000 99.923000 100.000000 0.000000 76.035.824-K SONDA SPA Chile Chilean pesos 100.000000 0.000000 100.000000 0.000000 100.000000 0.000000 100.000000 0.000000

Foreign SONDA TECNOLOGIAS DE COSTA RICA S.A.

Costa Rica US dollars 0.000000 100.000000 100.000000 0.000000 0.000000 100.000000 100.000000 0.000000

Foreign SONDA URUGUAY S.A. Uruguay US dollars 49.898000 50.102000 100.000000 0.000000 49.898000 50.102000 100.000000 0.000000 96.823.020-4 TECNOGLOBAL S.A. Chile US dollars 0.000001 99.999999 100.000000 0.000000 0.000001 99.999999 100.000000 0.000000

Foreign TELSINC COMERCIO DE EQUIPAMIENTO DE INF. LTDA Brazil Brazil reias 0.950028 99.049972 100.000000 0.000000 0.950028 99.049972 100.000000 0.000000

Foreign TELSINC PREST. DE SERV. PARA SIST. DE INF. LTDA (1) Brazil Brazil reias 0.950028 99.049972 100.000000 0.000000 0.950028 99.049972 100.000000 0.000000

76.006.868-3 TRANSACCIONES ELECTRONICAS S.A. Y FILIALES Chile Chilean pesos 0.000000 50.000100 50.000100 49.999900 0.000000 50.000100 50.000100 49.999900

76.415.784-2 TRANSACCIONES ELECTRONICAS S.A. 2 Y FILIALES Chile Chilean pesos 0.000000 50.000100 50.000100 49.999900 0.000000 50.000100 50.000100 49.999900

Foreign CONSORCIO SONDA ECUADOR (4) Ecuador US dollars 70.000000 30.000000 100.000000 0.000000 70.000000 30.000000 100.000000 0.000000

Foreign SONDA PROCWORK OUTSORCING Y FILIAL (ATIVAS) (9) Brazil Brazilian reias 0.000000 60.000000 60.000000 40.000000 0.000000 0.000000 0.000000 0.000000

Foreign CONSORCIO SONDA COLOMBIA (10) Colombia Colombian peso 20.000000 80.000000 100.000000 0.000000 0.000000 0.000000 0.000000 0.000000 Foreign SONDA SERVICIOS S.A.S. (11) Colombia Colombian peso 0.000000 100.000000 100.000000 0.000000 0.000000 0.000000 0.000000 0.000000


Financial statement information of the consolidated subsidiaries has been disclosed in Note 34.

Acquisitions (or capital contributions) and disposals of subsidiaries made by the Company in 2016 and 2015 have been as follows:

(1) In January 2015, the partners of the subsidiary Kaizen Consult. e Servicos en Inf. Ltda. agreed to the dissolution of the company and merge with the subsidiary Telsinc Prestacao de Servicos para Sistemas de Inf. E com. De dados Ltda. This corporate restructuring in the Brazilian subsidiaries had no effect on the consolidated financial statements of SONDA S.A.

(2) In June 2015, SONDA FILIALES BRASIL S.A. made a capital contribution to its subsidiary ARAUCANIA PARTICIPACOES LTDA. of R$14.5 million. This capital increase did not change the ownership interest in the subsidiary.

(3) On August 11, 2015, Sonda Procwork Inf. Ltda. acquired from the subsidiary Quintec Inversiones Latinoamericanas S.A. 1,520,439 shares of the company Quintec Brasil Servicos de Informática Ltda, equivalent to 99.9999% ownership interest.

This transaction was treated as a combination of entities under common control, method under which the contribution of these shares was recognized at their carrying value and the difference was recognized with a charge to other reserves in equity At SONDA’s consolidated level this transaction did not generate effects in equity.

(4) On November 20, 2015, Consorcio Sonda Ecuador was incorporated in Quito, Ecuador.

Consorcio Sonda Ecuador was created with an initial capital contribution of US$7,000 made by Sonda S.A. (70% ownership interest) and US$3,000 made by Sonda del Ecuador Ecuasonda S.A. (30% ownership interest).

(5) On January 1, 2015, it was changed the functional currency of Sonda Mexico S.A. C.V.

(6) Through Minutes N° 49 of the Shareholders Meeting of March 30, 2015 recorded in the Chamber of Commerce on December 24, 2015 under number 02048441, book IX, SONDA de Colombia took over Quintec Colombia S.A.S. by merger. This company was identified under NIT 900.215.823-3, which becomes dissolved without liquidation. The merger was approved by the Superintendence of Companies through resolution N° 300-004364 on November 30, 2015. SONDA de Colombia undertook the assets, liabilities, equity, income, costs and expenses of Quintec Colombia S.A.S.

The merger of the companies operating activities was carried out as from January 01, 2016.

(7) At Nextira One Mexico S.A. de C.V.’s Extraordinary Shareholders Meeting held on December 1, 2015, the merger of this company with Sonda Mexico S.A. de C.V. was unanimously agreed.

As a result of the above, the shareholding structure of Sonda Mexico S.A. de C.V. is made up as follows:

Shareholders Total SharesSonda S.A. 585,435

Sonda Servicios Profesionales S.A. 1

Sonda Regional S.A. 583,000

Total 1,168,436

The merger of the operating activities of both companies was carried out as from January 01, 2016.

(8) On April 4, 2016, the directors of the Sociedad Araucanía Part. Ltda. agreed the incorporation of the latter into its affiliate CTIS Tecnología S.A. in order to simplify the corporate structure and reduce the administrative expenses.

On the same date, the Capital Increase was made, as well as the amendment of CTIS Tecnología S.A.’s bylaws. The increase of capital amounted to R$173.8 million, which was executed and paid by the incorporation of the companies.

(9) Acquisition of ATIVAS DATACENTER S.A.

i) On October 19, 2016, SONDA acquired 60% of the Brazilian company ATIVAS DATACENTER S.A.’s ownership. This is a company located in the state of Minas Gerais engaged in Datacenter and Cloud Computing services owning the single world class Data Center in said state, in the city of Belo Horizonte.

ii) The acquisition took place through the affiliate SONDA PROCWORK OUTSOURCING LTDA., upon compliance with the necessary terms, among which are included the regulatory approvals by the Brazilian free competition authorities. It was materialized by a capital contribution of R$114 million (US$35 million approx., subscribing and paying 273,924,491 shares).

iii) The previous owners of the company, Cemig Telecom and Ativas Partic, remain the owners of the remaining 40%.

iv) The transaction also considered R$76 million funding for non-controlling shareholders for their respective contributions of capital. This funding is guaranteed by the shares (40% share in ATIVAS DATACENTER S.A.) and any flow received by the non-controlling shareholders, as dividends for example.


v) The functional currency of the acquired company is Brazilian Real.

vi) In October 2016, the initial recording of the acquisition was made. According to the acquisition method, the preliminary assignment of fair values and capital gain in the acquisition of this investment was performed. To this, the report of external independent specialists was used. The Company is evaluating additional information about facts or circumstances existing at the time of acquisition that could involve a change in the identification and valuation of assets and liabilities. This evaluation process will end within the valuation period, which will not exceed the term of a year from the acquisition date according to that stated in paragraph 49 of IFRS “Business combination”.

vii) The summary of the Company’s Financial Statement acquired, including the assignment of the fair value as evaluated by the Company on the purchase date, is presented below:

ASSETS Carrying amount

Fair value Adjusted adjustment (*) balance

ThCh$ ThCh$ ThCh$ Current assets 23,153,412 - 23,153,412

Non Current assets 29,911,978 18,243,837 48,155,815

Total Assets 53,065,390 18,243,837 71,309,227

LIABILITIES Carrying amount

Fair value Adjusted adjustment (*) balance

ThCh$ ThCh$ ThCh$ Current liabilities 18,258,847 - 18,258,847

Non-current liabilities 7,205,487 6,202,981 13,408,468

Shareholders' equity 27,601,055 12,040,857 39,641,912

Total Liabilities 53,065,390 18,243,837 71,309,227 (*) It corresponds to the fair value assigned to Datacenter’s fixed assets.

viii) Main amounts in balance accounts recognized from the acquisition date:

ASSETS ThCh$Cash and cash equivalents -

Other financial assets 17,848,289

Trade and other current receivables 1,633,565

Other current assets 3,671,557

Property, plant and equipment 38,031,813

Intangible assets identified 3,359,728

Other non current assets 6,764,274

TOTAL 71,309,226

TOTAL NET ASSETS 39,641,911

LIABILITIES ThCh$Trade and other current payables 1,830,811

Other current financial liabilities 14,541,625

Other current liabilities 1,886,411

Other non current financial liabilities 6,767,234

Other non current liabilities 6,641,234

TOTAL 31,667,315

ix) Valuation of the business combination:

ThCh$ R$ Participation in the equity of the acquirer at fair value 20,623,045 97,550 Cash transferred 24,100,740 114,000 Goodwill determined at the date of acquisition (Note 13) 3,477,695 16,450

x) The reconciliation of the cash transfered by the acquisition and the total investment is summarized below:

ThCh$ R$ Direct capital contributions in the subsidiary 24,100,740 114,000

Financing to minority shareholders for capital contributions 15,892,641 76,000

Goodwill determined at the date of acquisition (Note 13) 39,993,381 190,000

xi) According to the investment contract, the shareholders have signed put and call options agreements for the non-controlling percentage (40% over ATIVAS DATACENTER S.A.), which can be exercised from 2021.

The valuation of these agreements has been made as indicated in

Note 3.2 n.

xii)This new investment accounted on December 31, 2016 income from ordinary activities for the total amount of ThCh$2,241,052 since the acquisition date (ThCh$13,203,721 for the 12-month accrued period as at December 31, 2016).

The loss recognized since the acquisition date amounts to ThCh$ 591,930 (loss for ThCh$25,946,082 for the 12-month accrued period as at December 31, 2016).

The expenses related to this acquisition and charged to income during 2016 amounted to ThCh$126,632.

(10) Consorcio Sonda Colombia: On November 22, 2016 a consortium agreement was signed between Sonda Colombia S.A. and Sonda S.A. in order to regulate the association for the preparation and joint presentation of the Proposal of Management and Operation Service of EAB (Empresa de Acueducto, Alcantarillado y Aseo de Bogotá – ESP) Computing Platform.


The participation of the Consortium members is as follows: Sonda de Colombia S.A. 80% and Sonda S.A. 20%.

(11) Sonda Servicios S.A.S.: On December 27, 2016, the limited partnership Sonda Servicios S.A.S. was incorporated in Bogotá for the development of activities in one or several Duty Free Zones exclusively.

The subscribed capital amounts to Col$ 300,000,000 divided in

300,000 common registered shares of Col$ 1,000, which shall be paid within a term not exceeding May 30, 2017.

(12) In October 2016, SONDA FILIALES BRASIL S.A. made a capital contribution to its affiliate PARS PRODUTOS DE PROCESSAMENTO DE DADOS LTDA. for R$66.3 million. This increase of capital did not modify the shareholding in said affiliate.

b. Business combinations

Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Company, liabilities incurred by the Company to the former owners of the acquiree and the equity interests issued by the Company in exchange for control of the acquiree. Acquisition-related costs are generally recognized in profit or loss as incurred.

In a business acquisition, an independent valuation expert is used to make a determination of the fair value of net assets acquired and the identification of intangible assets. For the valuation of these intangibles identified in a business combination are used cash flow projections based on yield estimates of the acquired businesses.

At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognized at their fair value, except that:

• Deferred tax assets or liabilities, and assets or liabilities related to employee benefit arrangements are recognized and measured in accordance with IAS 12 Income Taxes and IAS 19, respectively;

• Liabilities or equity instruments related to share-based payment arrangements of the acquiree or share-based payment arrangements of the Company entered into to replace share-based payment arrangements of the acquiree are measured in accordance with IFRS 2 at the acquisition date; and

• Assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations are measured in accordance with that Standard.

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer’s previously held interest in the acquiree (if any), the excess is recognized immediately in profit or loss as a bargain purchase gain.

Non-controlling interests that are present ownership interests and entitle their holders to a proportionate share of the entity’s net assets in the event of liquidation may be initially measured either at fair value or at the non-controlling interests’ proportionate share of the recognized amounts of the acquiree’s identifiable net assets. The choice of measurement basis is made on a transaction-by-transaction basis. Other types of non-controlling interests are measured at fair value or, when applicable, on the basis specified in another IFRS.

The contingent consideration resulting from a business combination is measured at fair value at the date of acquisition, as part of that business combination. The determination of fair value is based on discounted cash flows. The key assumptions take into consideration the possibility of reaching each goal of financial performance and the discount factor.

When the consideration transferred by the Group in a business combination includes assets or liabilities resulting from a contingent consideration arrangement, the contingent consideration is measured at its acquisition-date fair value and included as part of the consideration transferred in a business combination. Changes in the fair value of the contingent consideration that qualify as measurement period adjustments are adjusted retrospectively, with corresponding adjustments against goodwill. Measurement period adjustments are adjustments that arise from additional information obtained during the ‘measurement period’ (which cannot exceed one year from the acquisition date) about facts and circumstances that existed at the acquisition date.

The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as measurement period adjustments depends on how the contingent consideration is classified. Contingent consideration that is classified as equity is not re-measured at subsequent reporting dates and its subsequent settlement is accounted for within equity. Contingent consideration that is classified as an asset or a liability is re-measured at subsequent reporting dates in accordance with IAS 39, or IAS 37 Provisions, Contingent Liabilities and Contingent Assets, as appropriate, with the corresponding gain or loss being recognized in profit or loss.


When a business combination is achieved in stages, the Company previously held equity interest in the acquiree is re-measured to its acquisition-date fair value and the resulting gain or loss, if any, is recognized in profit or loss. Amounts arising from interests in the acquiree prior to the acquisition date that have previously been recognized in other comprehensive income are reclassified to profit or loss where such treatment would be appropriate if that interest were disposed of.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Company reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (according with paragraph above), or additional assets or liabilities are recognized, to reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date.

Business combinations under common control:

Business combinations under common control are recorded using, as a reference, the ‘pooling of interest’ method. Under this method, the assets and liabilities involved in the transaction remain reflected at the same carrying amount at which they were recorded in the ultimate controlling parent. Any difference between the assets and liabilities contributed to the consolidation and the consideration transferred, is recorded directly in Net equity, as a debit or credit to other reserves.

c. Currency

The financial statements of each of the companies included in the consolidated financial statements are presented in the currency of the primary economic environment, in which the companies operate (their functional currency). The statements of financial position, comprehensive income and statements of cash flows of each company are measured in Chilean pesos, which is the functional currency of the parent Company and the presentation currency of the consolidated financial statements.

d. Offsetting of Balances and Transactions

As a general rule, assets and liabilities and income and expenses are not offset in the financial statements, unless required or permitted by an IFRS and offsetting reflects the substance of the transaction.

Income or expenses from transactions that contractually or legally include the possibility of offsetting, and for which SONDA S.A. intends to settle them for their net amounts or realizing the assets and settling the liabilities simultaneously, are presented net in the statement of comprehensive income and statement of financial position.

As of December 31, 2016 and 2015, the Company does not present income and expenses on a net basis in their statements of comprehensive income.

The Company has offset in the statement of financial position the following items:

• Current tax assets and liabilities are presented net at the subsidiary level, when the subsidiary has a legally enforceable right to set off the current tax assets with the current tax liabilities, when those are related to taxes levied by the same taxation authority and the taxation authority permits the entity to make or receive a single net payment.

Accordingly, the subsidiary’s deferred tax assets and liabilities are offset, if they related to taxes levied by the same taxation authority, provided that the entity has a legally enforceable right to set off the current tax assets with current tax liabilities.

• Forward derivative instruments are presented net, as their respective agreements establish exchange for compensation of differences when settling the transaction.

e. Transactions in Foreign Currency

Transactions in currencies other than the Company’s functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary assets and liabilities denominated in foreign currencies are retranslated at the rates prevailing at that date. Profits or losses in foreign currency resulting from the settlement of these transactions and the translation of monetary assets and liabilities denominated in foreign currency at the closing exchange rates are recognized in the consolidated statements of comprehensive income.

Assets and liabilities denominated in U.S. dollars (US$), Brazilian reais (R$), Colombian pesos (COL$), Mexican pesos (MX$), Peruvian soles (SOL$), Argentinean pesos (ARG$) and Euros (€) have been translated into Chilean pesos (presentation currency) at each closing exchange rate:

Period U.S. Dollars Mexican Peso

Colombian Peso

Peruvian Sol

Brazilian Reais Euro Argentinean

Peso

12.31.2016 669,47 32,46 0,22 199,69 205,82 705,60 42,28

12.31.2015 710,16 40,95 0,22 208,25 178,31 774,61 54,75

“Unidades de Fomento” (UF) (inflation index-linked units of account) are indexation units that are translated into Chilean pesos. The changes in the exchange rate are recognized in the item “Results from indexed units” in the consolidated statement of comprehensive income.


f. Intangibles

The Company and its subsidiaries have the following types of intangibles:

Internally-Generated Intangible Assets for Internal Use or to Be Traded – Research and Development Costs

Expenditures on research activities are recognized as expenses in the period in which they are incurred.

An internally-generated intangible asset arising from development (or from the development phase of an internal project) is recognized if, and only if, all of the following has been demonstrated:

• The technical feasibility of completing the intangible asset so that it will be available for use or sale;

• The intention to complete the intangible asset for use or sell it;• The ability to use or sell the intangible asset;• How the intangible asset will generate future economic benefits;• The availability of adequate technical, financial and other resources

to complete the development and to use or sell the intangible asset; and

• The ability to measure reliably the expenditures attributable to the intangible asset during its development.

The amount initially recognized for internally-generated intangible assets is the sum of the expenditures incurred from the date when the intangible asset first meets the recognition criteria listed above. When no internally-generated intangible asset can be recognized, development expenditures are recognized in profit or loss in the period in which they are incurred.

Subsequent to initial recognition, internally-generated intangible assets are reported at cost less accumulated amortization and accumulated impairment losses, if any.

An intangible asset is derecognized on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from de-recognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset, are recognized in profit or loss when the asset is derecognized

Development Expenditures for Tailor-Made Projects

The expenditures incurred in the development of certain significant specific projects (that meet the conditions to be classified as intangible assets listed above) are capitalized and amortized over the periods in which such expenditures will generate revenue, which is usually related to revenue from contract agreements with customers. The Company believes that, given the nature of its intangible assets, these assets have finite useful life and their amortization begin when they are

available for use. Amortization is recognized on straight-line basis over the estimated useful lives, which were determined based on the time expected to obtain future economic benefits. The estimated useful lives and the amortization method are reviewed at each year-end. Any changes are accounted for prospectively as changes in accounting estimates.

Period Minimum Life

Maximum Life

Development expenditures for tailor-made projects Months (i) (i)

Expenditures for development of the Company’s software Months 48 48

Other identifiable intangible assets Months 12 48

(i) The maximum period of amortization of development expenditures for tailor-made projects will depend on the term period of the respective agreement or the useful life of the assets (whichever is shorter).

Intangible assets acquired in a business combination

Intangible assets acquired in business combinations are initially recognized at fair value determined at the date of purchase, in accordance with IFRS 3. These assets are classified as intangible assets with finite useful lives, which are amortized over the useful life determined depending on the period in which these assets are expected to generate benefits, and are annually tested for impairment or when there are factors indicating that those assets have suffered an impairment loss.

Correspond mainly to:

Trademarks – They correspond to legal rights of use of the trademark of acquired companies. Given SONDA’s usual policy of discontinuing the use of these trademarks, as has occurred in past acquisitions, this intangible is amortized over a period of time sufficient for migration to the SONDA trademark. The amortization term, allocated according to the business plan of the company, range from to 2 to 4 years.

Customer Lists and Customer Relationships - These correspond to the valuation over time of relationships with customers, originated in the sale of products and services through the company’s sales team. These relationships will represent sales orders, which generate revenue and cost of sales. The amortization term allocated based on the long-term business plan range from 10 to 15 years.

Backlog of contracts – Relevant group of contracts with customers that ensure future revenues for the company. The amortization period reflects the pattern in which it is expected that the economic benefits for the acquirer are consumed, which will depend on the analysis of the client portfolio and associated business segment, up to a maximum of 5 years.


Goodwill:

Goodwill arising from an acquisition of a subsidiary represents the excess of the consideration transferred over the Company’s ownership interest in the fair value of assets, liabilities and identifiable contingent liabilities of the acquiree recognized at the acquisition date. Goodwill is initially recognized as an asset at cost and is subsequently measured at cost less any impairment loss, if any.

For the purposes of impairment testing, goodwill is allocated to each of the Company’s cash-generating units (CGUs) that are expected to benefit from synergies of the combination. The Company tests annually for impairment intangible assets with indefinite useful lives, or whenever there is indication that the assets may be impaired. If the recoverable amount of the CGU is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata based on the carrying amount of each asset in the unit. Impairment losses recognized for goodwill are not reversed in subsequent periods.

On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the gain and loss on disposal.

Goodwill arising on the acquisition of a foreign operation is measured in the functional currency of the foreign operation.

When the final determination of goodwill is completed within the financial statements of the following year after the acquisition, comparative information for prior year is revised as needed as if the accounting for the business combination had been completed at the acquisition date.

Beginning on January 1, 2010, when the amendments to IAS 27 (2008) - Consolidated and Separate Financial Statements became effective, the effects from transactions between the controlling entity and non-controlling interests that do not result in a loss of control are accounted for as equity transactions.

g. Property, plant and equipment

The Company’s property, plant and equipment are tangible assets that meet the following definition:

• They are for internal use (management and sales).• They are used to provide services.• They are acquired under a lease agreement (that meet the

conditions in IAS 17).• They are expected to be used for more than one period (long-term

nature).• They are significant spare parts and maintenance equipment

acquired for specific long-term projects.

The initial cost of property, plant and equipment include:

• Its purchase price (including import duties and other import-related costs); and

• Any cost directly attributable to bringing the asset to its final location and the condition necessary for it to be capable of operating in the manner intended by management.

• Finance expenses accrued during the construction period that are directly attributable to the acquisition or construction of qualifying assets.

The Company has chosen the cost model to measure all of its items of property, plant and equipment. The cost model consists of measuring the items at their cost less any accumulated depreciation and any impairment losses (if any).

An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.

The Company begins to depreciate its property, plant and equipment when they are available for use, by allocating the depreciable amount of the assets on a straight line basis over their estimated useful lives.

The estimated useful lives are as follows:

Period Minimum Life

Maximum Life

Buildings and constructions Months 600 1.200

IT Equipment (i) Months 36 (i)

Networking and communication equipment Months 36 60

Vehicles Months 36 60

Property, plant and equipment under finance lease Months 36 60

Other Property, Plant and Equipment (ii) Months 36 60

Other Property, Plant and Equipment - Office furniture (iii) Months 36 60

(i) IT equipment includes assets that are used in projects, which are depreciated over the term of the service agreement or their useful life (whichever is shorter).

(ii) The useful life assigned will depend on the license term; if it is indefinite, a minimum of 36 months is assigned.

(iii) The office furniture generally becomes depreciated in 60 months, with a shorter range being able to apply, but which will depend on the use and wear and tear on the assets.


h. Investment property

The Company recognizes as investment properties those properties held either to earn rental income or to obtain a capital gain on their sale as a result of increases occurring in the future in their respective market prices.

Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation and accumulated impairment losses.

An investment property is derecognized upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on de-recognition of the property (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the period in which the property is derecognized.

Investment properties, excluding land, are depreciated on a straight line basis over their estimated useful lives as follows:

Period Minimum Life Maximum Life Buildings and constructions Months 600 1,200

i. Revenue Recognition

The main significant accounting policies for revenue recognition are:

Sale of hardware: Revenue from the sale of hardware is recognized when:

• Equipment has been shipped.• Hardware has been installed as required by the contract agreement.• The company had transferred to the buyer the significant risks and

rewards of ownership of the goods• The company retains neither continuing managerial involvement to

the degree usually associated with ownership nor effective control over the goods sold

• The amount of revenue can be measured reliably• It is probably that the economic benefits associated with the

transaction will flow to the company • The costs incurred or to be incurred in respect of the transaction can

be measured reliably.

Services

• For IT outsourcing services, data center services, professional services and consulting services, BPO, infrastructure support, technical support an others: revenue is recognized by reference to the stage of completion of the contract. When the services have been rendered to the customer.

• For revenue from projects and system integration (including software development): the Company recognizes revenue in accordance with the progress statements approved by the customers and/or the corresponding progress stage of the project.

License Sale

• Revenue from the sale of licenses is recognized when the software has been delivered

j. Impairment of Assets

The Company evaluates annually the impairment of its assets in conformity with the methodology established by the Company which is in compliance with IAS 36.

The assets on which the Company applies this methodology are the following:

• Property, plant and equipment• Goodwill• Intangible assets other than goodwill• Investments in subsidiaries and associates• Other non-current non-financial assets (Projects)

• Impairment of Property, Plant and Equipment, Intangible Assets, Investments in Subsidiaries and Associates, and Other Non-Financial Assets (Excluding Goodwill):

At the end of each reporting period, the Company reviews the carrying amount of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). If the asset does not generate cash flows that are independent from other assets, the Company calculates the recoverable amount of the cash generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of the money and the risks specific to the asset.

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised


estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognized immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss in treated as a revaluation increase.

The intangible assets that have an indefinite useful life are not subject to amortization and are annually tested for impairment. The assets subject to amortization are tested for impairment provided that any event or change in the circumstances indicates that the carrying amount may not be recoverable.

IT equipment used to provide services for specific projects to clients are grouped at the lowest level of cash generating units. In the case of investments in infrastructure used to provide services to several clients (Data center), they are measured considering operating factors, technology obsolescence and alternative uses of such assets. The Company reviews the estimated useful lives at the end of each reporting period or when any event indicates that the useful lives are different.

In estimating value in use, the Company prepares pre-tax future cash flows based on contractual agreements and budgets.

Based on its tests for impairment, the Company’s management considers that there are no indications of impairment of the carrying amount of its tangible and intangible assets, as their carrying amounts do not exceed the recoverable amount of the assets.

• Impairment of goodwill

In the case of Cash Generating Units to which goodwill or intangible assets with an indefinite useful live have been assigned, the analysis of its recoverability is annually performed at the end of each reporting period.

The recoverable amount is the higher of fair value less cost of disposal and value in use, which is the present value of estimated future cash flows. In calculating the recoverable amount of property, plant and equipment, goodwill and intangible assets, Sonda uses the value in use approach in almost all cases.

In assessing value in use, SONDA prepares five-year projections of nominal pre-tax cash flows, based on market information, management's expectations, historical information and the most recently available budgets. Based on this information are determined the values or ranges for growth rates, which are then compared with projected growth rates for the IT industry provided by independent institutions such as International Data Corporation or other similar institutions.

Country Currency Growth rates range year 2016

Growth rates range year 2015

Brasil Brazilian reais 14% - 18% 14% - 18%

Chile Chilean pesos 15% - 19% 10% - 16%

Colombia Colombian peso 15% - 16% 14% - 18%

Mexico US dollars 11% - 15% 11% - 15%

Argentina US dollars 12% - 16% 7% - 11%

The nominal pre-tax discount rate used to calculate the present value of the estimated cash flows is determined from the cost of capital of the related business and the country in which it is developed. For its calculation, is considered the time value of money, local inflation and United Stated, risk premiums generally used by analysts according to the business, the structures of average capital of comparable companies and the geographical area (country risk). Several countries in the region showed changes in the main assumptions as follows: country risk, inflation and cost of debts. This effects led to changes in the respective discount rate.

Country Currency Discount rates range year 2016

Discount rates range year 2015

Brasil Brazilian reais 14% - 16% 14% - 18%

Chile Chilean pesos 9% - 11% 8% - 12%

Colombia Colombian peso 11% - 13% 10% - 14%

Mexico US dollars 10% - 12% 9% - 13%

Argentina US dollars 15% - 17% 15% - 20%

When the recoverable amount is lower than the net carrying amount of the assets, the corresponding impairment loss is recognized for the difference, and charged to “Reversal of impairment loss (impairment loss) recognized in profit or loss” in the consolidated statement of comprehensive income.

Impairment losses recognized for an asset in prior years are reversed when a change occurs in the estimates over the recoverable amount, thus increasing the asset’s carrying amount with a credit to profit or loss, limited to asset’s carrying amount if no impairment had occurred. In the case of goodwill, impairment losses are not reversed.

• Impairment of Financial Assets:

Financial assets, other than those measured at fair value through profit or loss, are assessed for indicators of impairment at the end date of each reporting period. Financial assets are considered to be impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition, the estimated future cash flows of the investment have been affected.


In general, for financial assets objective evidence of impairment could include:

• Significant financial difficulty of the issuer or counterparty; • Breach of contract, such as a default or delinquency in interest or

principal payments• It becoming probable that the borrower will enter bankruptcy or

financial re-organization; or• the disappearance of an active market for that financial asset

because of financial difficulties.

Considering all of the Company’s financial investments have been made in high credit quality institutions and they mature in the short term (less than 90 days), the impairment testing results indicate that there are no observable evidence of impairment.

At the end of each reporting year, an entity will evaluate if there is objective evidence for a financial asset or group of them – measured at the amortized cost – has deteriorated or not.

If there is objective evidence of impairment loss in the value of financial assets measured at amortized cost, the loss amount will be measured as the difference between the book value of assets and the present value of future cash flows as estimated (excluding future credit losses not incurred) and discounted at the effective original rate of interest of the financial asset (i.e. the effective rate of interest computed at the initial time of recognition). The book value of the asset will be directly reduced or through a remedial account. The loss amount will be recognized in the result of the year.

Additionally, in accordance with paragraph GA85 of IAS 39, the process for estimating impairment considers all credit exposure. Accordingly, for financial assets with commercial origin, the Company has defined a policy to recognize impairment losses through the use of an allowance account based on the aging of past-due balances. The Company has determined that the process for estimating the amount of an impairment loss does not result in a single amount, but a range of possible amounts based on the best estimate within that range.

The Company has determined the following parameters and percentages to be applied in estimating impairment for such items.

Tramo de antigüedad Private Clients Government Related Clients

90 to 120 days 10% 5% 121 to 180 days 20% 10% 181 to 360 days 50% 50% 361 and more days 100% 100%

These estimates have been made based on regular credit policies using the behavior and characteristics of the Company's portfolio of customers. Accordingly, the Company has determined the allowance

factors that are applied to the portfolio of debtors stratified based on the aging intervals in the table above. For debtors with balances less than 90 days, the Company has analyzed the characteristics of its portfolio of customers, the historical behavior of this aging interval and the specific evaluations of its customers. The Company has concluded that there is no objective evidence that the amounts will not be recovered, taking into consideration a regular collection period in accordance with the characteristics of the business.

Additionally, the company constantly reviews all degrees of past due balances of debtors in order to identify any significant indication of impairment on a timely basis.

The analysis of impairment of assets with commercial origin considers outstanding invoices, as well as, receivables from finance leases (lease receivables) and notes receivable.

For notes receivable, an impairment allowance is recognized for the entire amount of the note, if such note receivable has matured.

In regard to unbilled debtors, these have been recognized as the service is rendered, or in accordance with the stage of completion of the projects, which are reviewed on an ongoing basis in order to determine any impairment losses, as appropriate.

k. Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to be ready for their intended use or sale, are added to the cost of these assets, until such assets are substantially ready for their intended use or sale.

l. Inventories

Inventories are stated at the lower of cost or net realizable value. Costs of inventories are determined on a weighted average cost basis.

The net realizable value represents the estimated selling price for inventories less all estimated costs required to make the sale.

The Company estimates the risk of obsolescence of its inventories based on their physical condition and turnover rate and their net realizable values.

Spare parts for specific projects with turnover rate of more than one year are presented as non-current assets in the item “Other non-financial assets.”

m. Leases

• Sales under finance leases are considered sales of goods, calculating the present value of the lease, and discounting the value


of the periodical payments and purchase option at the interest rate of each lease.

• Purchases under finance leases are considered as purchases of properties, plant and equipment, recognizing the entire obligation and interest on an accrual basis.

Such assets are not legally owned by the Company. Therefore, while the Company does not exercise the purchase option, it cannot freely dispose of them. These assets are presented in each class of property, plant and equipment.

• Assets under a financial leaseback are recorded by keeping such assets in property, plant and equipment at the same carrying amount recognized before the transaction, and recognizing the funds obtained as a credit to “Other financial liabilities”.

• The result obtained in this operation is presented in "Other property, plant and equipment" and amortized over the duration of the contract.

• Lease payments under operating leases are recognized as expenses on a straight line basis over the lease term.

Assets held under finance leases are initially recognized as assets at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the consolidated statement of financial position as a finance lease obligation.

Lease payments are apportioned between finance expenses and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance expenses are recognized immediately in profit or loss, unless they are directly attributable to qualifying assets, in which case they are capitalized in accordance with the Company’s policy on borrowing costs.

n. Financial instruments

Financial assets and financial liabilities are recognized when the Company becomes a party to the contractual provisions of the instruments.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

Financial assets

Financial assets are classified into the following specified categories: financial assets ‘at fair value through profit or loss’ (FVTPL), ‘held-to-maturity’ investments, ‘available-for-sale’ (AFS) financial assets and ‘loans and receivables’. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace.

(i) Financial assets at fair value through profit or loss (FVTPL)

Financial assets are classified as financial assets at fair value through profit or loss (FVTPL) when the financial asset is held for trading, or it is designated as at FVTPL.

A financial asset is classified as held for trading if:

• It has been acquired principally for the purpose of selling it in the near term; or

• On initial recognition it is part of a portfolio of identified financial instruments that the Company manages together and has a recent actual pattern of short-term profit-taking; or

• It is a derivative that is not designated and effective as a hedging instrument.

A financial asset other than a financial asset held for trading that may be designated as at financial assets at fair value through profit or loss upon initial recognition if:

• Such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or

• The financial asset forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is evaluated on a fair value basis, in accordance with the Company documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or

• The financial asset forms part of a contract containing one or more embedded derivatives, and IAS 39 permits the entire combined contract to be designated as at fair value through profit or loss.

(ii) Held-to-maturity investments

Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturity dates that the Company has the positive intent and ability to hold to maturity. Subsequent to initial recognition, held to maturity investments are measured at amortized cost using the effective interest method less any impairment.


(iii) Available-for-sale financial assets ( AFS )

Available-for-sale financial assets are non-derivatives financial assets that are either designated as available-for-sale or are not classified as (a) loans and receivables, (b) held-to-maturity investments or (c) financial assets at fair value through profit or loss.

These investments are presented in the consolidated statement of financial position at fair value. Changes in fair value, net of the tax effect are recognized in other comprehensive income, until the disposal of these investments, at which time the amount accumulated in this item is recognized in full in profit or loss for the year.

These investments held by the Company are measured at fair value at the end of each reporting period. Changes in the carrying amount of Available-for-sale monetary financial assets relating to changes in foreign currency rates, interest income calculated using the effective interest method and dividends on Available-for-sale equity investments are recognized in profit or loss. Other changes in the carrying amount of available-for-sale financial assets are recognized in other comprehensive income and accumulated in “Reserve of gains and losses on re-measuring available-for-sale financial assets” in equity. When the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously accumulated in the investments revaluation reserve is reclassified to profit or loss.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments, not quoted on an active market; they are classified as current assets, except for maturity above 12 months from the balance sheet date, which are classified as noncurrent assets. Loans and payables include trade debtors, financial lease debtors, documents and other receivables.

Call option

The call option qualifies as derivative instrument according to IAS 39. For the call to be valued, the Company used the Black & Scholes-Merton methodology. This formula calculates the option value on the basis of premises and probabilities associated with the expectations of future revaluation of shares, the volatility of assets, the free rate of risk, the price to exercise the option and a number of other events.

Period to exercise the options• The period to exercise the put and call options was set in the

purchase agreements of ATIVAS signed on October 19, 2016.• The occurrence probability for the exercise of the option during the

first period (4 years and 6 months) is 100%.

Free rate of risk• Reference rates from the BM & F were used.• DI curves for 5 and 9 years (1 and 2, respectively) to represent a

compensation free from the inflation effects, which makes the yields similar to that of preset financial instruments free of risk.

• For each reference date, the DI curve at that time is used, adjusting the discrete rate on an ongoing basis.

Volatility• The historic volatility of Sonda` shares as a comparable company

is considered, based on Sonda`s closing price (Sonda CI Equity) negotiated in the stock exchange.

• The period considered for calculating volatility is the same as for the end of options granted (i.e. 4 years and 6 months from the granting date).

Put option

The put option for an equity instrument (minority interest) generates financial liabilities measured at its present value under the following aspects:

SONDA has recorded the assets and liabilities acquired when taking over of ATIVAS S.A. as described in Notes 3.2 through 9). Since SONDA has 60% of ATIVAS DATACENTER S.A.’s ownership, a Non-Controlling Interest (NCI) is generated for the remaining 40%. The current owners of 40% of ATIVA S.A.’s shares has a PUT option to sell shares to SONDA; this is why an obligation arises for the latter for the selling price of shares of the NCI at its present fair value. In this respect, the following IFRS regulatory aspects have been considered:

• IAS 32 sets that the PUT options granted to the owners of NCI shares originates liabilities that should be measured at fair value, which is given by the present value of the value of the year.

• Later, the liabilities must be measured under IAS 39.• The put option granted to the minority interests of affiliates is valued

according to its exercise price and classified as financial debt with charge to the balance of minority interests of the consolidated financial statement at each closing date. Should the exercise price exceed the balance of the non-controlling interests, the difference is classified under the item other reserves of the equity.

• Should the put be exercised, the same treatment described above is applied at the date of exercise; the liabilities determined in this way end with the payment of the PUT option at the price set.

• Should the option be not exercised, the NCI is recognized, the assets are eliminated and differences, if any, are recorded charged against or credited to the equity reserves.

De-recognition of Financial Assets

The Company derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the


financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Company neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognizes its retained interest in the asset and an associated liability for amounts it may have to pay. If the Company retains substantially all the risks and rewards of ownership of a transferred financial asset, the Company continues to recognize the financial asset and also recognizes a collateralized borrowing for the proceeds received.

On de-recognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognized in other comprehensive income and accumulated in equity is recognized in profit or loss.

On de-recognition of a financial asset other than in its entirety (e.g. when the Group retains an option to repurchase part of a transferred asset), the Company allocates the previous carrying amount of the financial asset between the part it continues to recognize under continuing involvement, and the part it no longer recognizes on the basis of the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognized and the sum of the consideration received for the part no longer recognized and any cumulative gain or loss allocated to it that had been recognized in other comprehensive income is recognized in profit or loss. A cumulative gain or loss that had been recognized in other comprehensive income is allocated between the part that continues to be recognized and the part that is no longer recognized on the basis of the relative fair values of those parts.

Financial liabilities and equity instruments

(i) Classification as debt or equity

Debt and equity instruments issued by a group entity are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

(ii) Financial instruments with characteristics of liabilities and capital

The financial instruments that include elements of capital or liabilities or both of them are classified - according to the economic nature of the operation and not according to its juridical nature – by the Company since its initial recognition as a capital instrument when: i) the holder thereof is exposed to the risks and benefits instead of having right to collect a fixed amount; ii) when the redemption of a redeemable capital instrument can be exercised only until the Company’s liquidation and there is no further unavoidable payment obligations in favor of the holder; iii) is subject to the reimbursement of any other financial instrument, this being why there is no reimbursement or payment

priority before other instruments. The Company classifies a financial instrument as capital from the date in which the instrument has all characteristics and meets the precedent conditions. The instrument is reclassified as liabilities when said characteristics disappear or the conditions are not met anymore. The initial costs incurred by the issue of a combined financial instrument are assigned to liabilities and capital according to the proportion of the amounts recognized in each case. The costs assigned to capital are deducted therefrom against the issue premium, if any, and the costs assigned to liabilities are deducted from the liabilities amount and they should be considered in order to determine the effective rate of interest, which is the annualized rate being equal to the amount of the cash flow of the future and the present value of the financial instrument.

(iii) Financial liabilities

Financial liabilities are classified as either financial liabilities at fair value through profit or loss (FVTPL) or “other financial liabilities”.

Financial liability at fair value through profit or loss (FVTPL)

Financial liabilities are classified as at fair value through profit or loss when the financial liability is held for trading, or it is designated as at fair value through profit or loss.

A financial liability is classified as held for trading if:

• it has been incurred principally for the purpose of repurchasing it in the near term;

• on initial recognition it is part of a portfolio of identified financial instruments that the Company manages together and has a recent actual pattern of short-term profit-taking; or

• it is a derivative that is not designated and effective as a hedging instrument.

A financial liability other than a financial liability held for trading may be designated as at fair value through profit or loss upon initial recognition if:

• such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise;

• The financial liability forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is evaluated on a fair value basis, in accordance with the Group’s documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or

• The financial liabilities forms part of a contract containing one or more embedded derivatives, and IAS 39 permits the entire combined contract (assets or liabilities) to be designated as at fair value through profit or loss.


Financial liabilities at fair value through profit or loss are stated at fair value, with any gains or losses arising on re-measurement recognized in profit or loss.

Other financial liabilities

Other financial liabilities (including borrowings and trade and other payables) are subsequently measured at amortized cost using the effective interest method.

The effective interest method is a method of calculating the amortized cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.

De-recognition of financial liabilities

The Company derecognizes financial liabilities when, and only when, the Company obligations are discharged, cancelled or have expired. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable is recognized in profit or loss.

o. Derivative financial instrument

o.1 Financial Derivatives - The Company recognizes all of the assets and liabilities which arise from operations with derivative financial instruments on the balance sheet at fair value, regardless of the purpose for which they are held. Fair value is determined based upon recognized market prices and when these are not quoted on the market, the fair values are determined based upon valuation techniques accepted in the financial world.

Negotiations with financial derivatives are only carried out with proven, solvent and reputable firms; in addition limits have been established for each institution. The policy of the Company is not to carry out operations with a speculative intent regarding these aforementioned instruments.

When the derivatives are taken with the purpose of hedging risks and they comply with all the hedging requirements, their designation at the beginning of the hedging operation is documented, their relevant characteristics and purpose are shown, and the accounting recognition and in what manner the measure of efficacy is to be carried out that is applicable to this operation.

Derivatives designated as hedges recognize the changes in valuation according to the type of hedges: (1) when they are fair value hedges, the fluctuations of both the derivative and the hedged amount are valued at fair value and are recognized in profit and loss; (2) when they are cash flows hedges, the effective portion is recognized temporarily in comprehensive income (loss, if any) and is applied to results when the hedged item affects them; the ineffective portion is recognized immediately in results; (3) when it is the hedge of an investment in a foreign subsidiary, the effective portion is recognized in comprehensive income (loss, if any) as part of the cumulative translation adjustment; the non-effective portion of the gain or loss of the hedging instrument is recognized in profit or loss for the period, if it is a derivative financial instrument and, if it is not, it is recognized in the comprehensive profit (loss, if any) until the investment is sold or transferred.

The Company suspends hedge accounting when the derivative has expired, has been sold, is canceled or exercised, when the derivative is not highly effective to offset the changes in fair value or the cash flows of the hedged item, or when the derivative Company decides to cancel the hedge designation.

When hedge accounting is suspended in the case of cash flow hedges, the amounts that have been recorded in accounting equity as part of the comprehensive income (loss, if applicable) remain in the equity until the effects of the predicted transaction or firm commitment affect the results. In the event that the firm commitment or the predicted transaction is no longer likely to occur, the gains or losses that were accumulated in the comprehensive profit (loss, if applicable) account are recognized immediately in profit or loss. When the hedge of a predicted transaction was satisfactory and subsequently does not meet the effectiveness test, the accumulated effects on the comprehensive income (loss, if applicable) in accounting equity are taken proportionally to results, to the extent that the forecasted asset or liability affects the results.

Certain financial derivative instruments, although contracted for hedging purposes from an economic perspective, when they do not comply with all the requirements set forth in the regulations, for accounting purposes have been designated as trading. The fluctuation in the fair value of these derivatives is recognized in comprehensive income.

o.2 Embedded derivatives - The Company assesses the existence of embedded derivatives in non-derivative contracts to determine whether their characteristics and risks are closely related to the host contract, as long as the host contract is not recognized at fair value. Where the risks and characteristics are not closely related to the host contract, the embedded derivative is treated as separate derivatives measured at fair value. The changes in fair value are recorded in profit or loss. At the date of each reporting period, SONDA has determined that there are no embedded derivatives in its non-derivative contracts.


p. Provisions

Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, for which it is probable that the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainty surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognized as an asset, if it is virtually certain that reimbursement will be received and the amount receivable can be measured reliably.

Provisions for Employee Benefits

The Company and certain subsidiaries have a provision to measure the obligation for severance indemnities that will be paid to their employees in accordance with the individual employment contracts. Also, the Company have recognized a provision for the five years of services awards, which are paid in equal periods every 5 years. In accordance with IAS 19, the provision is determined using the Projected Unit Credit Method. The obligation for these benefits is presented in the line item “Non-current provisions for employee benefits”.

Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered service entitling them to the contributions.

For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. Re-measurement, comprising actuarial gains and losses, is reflected immediately in the statement of financial position with a charge or credit recognized in other comprehensive income in the period in which they occur. Re-measurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to profit or loss. Past service cost is recognized in profit or loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorized as follows:

• Service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);

• Net interest expense or income; and • Re-measurement.

The Company and its subsidiaries have recognized a provision for the cost of employee vacations and other employee benefits on an accrual basis. The obligation for these employee benefits is presented in the item “Trade and other current payables".

Guarantees

Provisions for the expected cost of warranty obligations under local sale of goods legislation are recognized at the date of sale of the relevant products, at the directors’ best estimate of the expenditure required to settle the Company obligation.

Contingent liabilities acquired in a business combination

Contingent liabilities acquired in a business combination are initially measured at fair value at the acquisition date.

q. Income Tax and Deferred Taxes

The Company and its subsidiaries in Chile accounts for income tax based on the net taxable income determined according to the standards established in the Income tax Law. The foreign subsidiaries determine their income taxes based on the standards in their respective countries.

Deferred taxes on temporary differences and other events that create differences between the accounting and tax basis of assets and liabilities are recognized in accordance with IAS 12 Income Taxes.

Income tax expense represent the sum of the tax currently payable by the Company and its subsidiaries which arises from the application of the tax rate to the taxable profit for the year, after permitted deductions have been made, plus any changes in deferred tax assets and liabilities and tax credits. Temporary differences between the carrying amounts of assets and liabilities and the corresponding tax bases originate deferred tax asset and liability and are measured at the tax rates that are expected to apply in the period when the liabilities are settled or the assets realized.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.Current tax and changes in deferred taxes are recorded in profit or loss or in equity within the statement of financial position, depending on where the gains or losses generating them have been recognized, except for assets or liabilities arising from business combinations.

Deferred tax assets and tax credits are recognized to the extent that it is probable that taxable profits will be available against which those deductible temporary differences and tax credits can be utilized. Deferred tax liabilities are recognized for all taxable temporary


differences, except to the extent that the deferred tax liability arises from the initial recognition of goodwill and those associated with investments in subsidiaries, associates and jointly controlled entities, in which the Company is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Current and deferred taxes for the year

Current and deferred taxes are recognized in profit or loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity, respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.

r. Statement of Cash Flows

For the purposes of preparing the statement of cash flows, the Company and its subsidiaries have considered the following definitions:

Cash and cash equivalents: include cash on hand, time deposits, fixed-income mutual fund units, and other short-term highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value and maturing in three months or less from the date of acquisition. Bank overdrafts are classified as current liabilities.

Operating Activities: are the principal revenue-producing activities of the Company and other activities that are not investing or financing activities.

Investing Activities: are the acquisition and disposal of long-term assets and other investments not included in cash equivalents.

Financing Activities: are activities that result in changes in the size and composition of the contributed equity and borrowings of the Company.

s. Earnings per Share

Basic earnings per share are calculated by dividing profit or loss attributable to equity holders of the Company by the weighted average

number of ordinary shares outstanding during the year, excluding the average number of the Company’s shares held by a subsidiary, if any. SONDA S.A. and its subsidiaries did not engage in any transaction with potential dilutive effect resulting in diluted earnings per share that could differ from basic earnings per share.

t. Dividends

The distribution of dividends to the shareholders is recognized as liabilities at the end of each reporting period based on the dividend policy agreed to at a Shareholders’ meeting, such dividend policy considered distributing 50% of the profits for the year. The amount of the obligation to the shareholders is calculated net of interim dividends approved during the year, and accounted for in the line item “Trade and other current payables" or “Account payable to related parties”, as appropriate, and recognized in “Retained earnings” within equity.

u. Factoring transactions

The company has factored certain accounts receivable related to sales of equipment, recognizing the cash obtained by crediting it to “other financial liabilities”.

v. Current and Non-Current Classification of Balances

In the accompanying consolidated statement of financial position, balances are classified based on their maturities, that is, those with maturities equal to, or less than twelve months, are classified as current balances and as those with maturities of more than twelve months are classified as non-current balances. If there are liabilities with maturities of less than twelve months, but the Company expects to, and has the discretion of refinancing an obligation for at least twelve months after the reporting period under an existing loan facility, they could be classified as non-current liabilities.

w. Environment

Environmental disbursements are recognized in profit or loss in the period in which they are incurred. SONDA has not made any environmental disbursements because the activity of the company and those of its subsidiaries are not related those that might affect the environment.

3.3 Reclassification and accounting changes

The Company has made the following reclassification in the statement of financial position as at December 31, 2015:


Previous Item New presentation ThCh$CURRENT ASSETSAccounts receivable from related parties

CURRENT ASSETSTrade and other current receivables 575,897

NON CURRENT ASSETSDeferred tax assets

NON CURRENT LIABILITIESDeferred tax liabilities 7,929,935

CURRENT LIABILITIESAccounts payable to related parties

CURRENT LIABILITIESTrade and other current payables 177,091

INCOME FROM OPERATING ACTIVITIESAdministration expenses

GROSS PROFITCost of sales 9,027,942

CASH FLOWS FROM (USED IN) INVESTING ACTIVITIESOther cash receipts from sales of equity or debt instruments of other entitiesOther cash payments to acquire equity or debt instruments of other entities

CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES

(7,623,330)

7,385,166

Effect of exchange rate changes on cash and cash equivalents 238,164

4. NEW ACCOUNTING STANDARDS

a) The following new and revised IFRS have been adopted in these consolidated financial statements:

New Standards Effective dateIFRS 14 Regulatory Deferral Account

This standard is applicable to first-time adopter of IFRS and for entities which are involved in rate-regulated activities and recognized regulatory deferral account balances under its previous general accepted accounting principles.

Annual periods beginning on or after January 1,

2016

Amendments to Standards Effective dateAccounting for Acquisitions of interests in Joint Operations (Amendments to IFRS 11)

Amends IFRS 11 Joint Arrangements to require an acquirer of an interest in a joint operation in which the activity constitutes a business (as defined in IFRS 3 Business Combinations) to:

- Apply all of the business combinations accounting principles in IFRS 3 and other IFRSs, except for those principles that conflict with the guidance in IFRS 11;- Disclose the information required by IFRS 3 and other IFRSs for business combinations.


2016

Clarification of Acceptable Methods of Depreciation and Amortization (Amendments to IAS 16 and IAS 38)

The amendments provide additional guidance on how the depreciation or amortization of property, plant and equipment and intangible assets should be calculated.


2016

Amendments to Standards Effective dateEquity Method in Separate Financial Statements (Amendments to IAS 27)

The amendments reinstate the equity method as an accounting option for investments in subsidiaries, joint ventures and associates in an entity's separate financial statements.


2016

Disclosure initiative (Amendments to IAS 1)

The initiative is made up of a number of smaller projects that aim at exploring opportunities to see how presentation and disclosure principles and requirements in existing Standards can be improved:

- Clarification that information should not be obscured by aggregating or by providing immaterial information, materiality considerations apply to the all parts of the financial statements, and even when a standard requires a specific disclosure, materiality considerations do apply;- clarification that the list of line items to be presented in these statements can be disaggregated and aggregated as relevant and additional guidance on subtotals in these statements and clarification that an entity's share of OCI of equity-accounted associates and joint ventures should be presented in aggregate as single line items based on whether or not it will subsequently be reclassified to profit or loss;- Additional examples of possible ways of ordering the notes to clarify that understandability and comparability should be considered when determining the order of the notes and to demonstrate that the notes need not be presented in the order so far listed in paragraph 114 of IAS 1.


2016

Amendments to Standards Effective dateInvestment Entities: Applying the Consolidation Exception (Amendments to IFRS 10, IFRS 12 and IAS 28)

To address issues that have arisen in the context of applying the consolidation exception for investment entities. These amendments clarify the limited scope of application of the exception to consolidation for investment entities and their subsidiaries. The amendments also reduce the requirements in particular circumstances, reducing the costs of the application of the Standard.


2016

Annual Improvements 2012-2014 Cycle

Makes amendments to the following standards:

- IFRS 5 – Adds specific guidance in IFRS 5 for cases in which an entity reclassify an asset from held for sale to held for distribution or vice versa and cases in which held-for-distribution accounting is discontinued.- NIIF 7 - Adds additional guidance to clarify whether a servicing contract is continuing involvement in a transferred asset for the purpose of determining the disclosures required and clarifies the applicability of the amendments to IFRS 7 on offsetting disclosures to condensed interim financial statements.- NIC 9 - Clarifies that the high quality corporate bonds used in estimating the discount rate for post-employment benefits should be denominated in the same currency as the benefits to be paid- NIC 34 – Clarifies the meaning of 'elsewhere in the interim report' and requires a cross-reference.


2016

The application of these amendments has not had a significant effect on the amounts reported in these consolidated financial statements, however could affect the accounting for future transactions or agreements.


b) New and revised IFRS in issue but not yet effective:

New Standards Effective dateIFRS 9 "Financial Instruments", introduces new requirements for the classification and measurement of financial assets as follows:

Debt instruments that are qualified by reference to the business model within which they are carried out and their contractual cash flow characteristics are measured at amortized cost (the use of fair value is optional in some limited circumstances)Investments in equity instruments can be designated as "fair value with changes in other comprehensive income" and dividends are recognized in income

All other instruments (including all derivatives) are measured at fair value with changes recognized in profit or loss. The concept of "embedded derivatives" does not apply to financial assets within the scope of the Standard and the entire instrument should be classified and measured according to the above guidelines.

It is introduced a new chapter to IFRS 9 on hedge accounting, putting in place a new hedge accounting model that is designed to be more closely aligned with how entities undertake risk management activities when hedging financial and non-financial risk exposures. Permits an entity to apply only the requirements introduced in IFRS 9 (2010) for the presentation of gains and losses on financial liabilities designated as at fair value through profit or loss without applying the other requirements of IFRS 9, meaning the portion of the change in fair value related to changes in the entity's own credit risk can be presented in other comprehensive income rather than within profit or loss.

Derecognition. The requirements for the derecognition of financial assets and liabilities are carried forward from IAS 39 Financial Instruments.


2018

IFRS 15 Revenue from Contracts with Customers The new standard provides a single, principles based five-step model to be applied to all contracts with customers

The five-step model are the following:

i) identify the contract with the customerii) identify the performance obligations in the contractiii) determine the transaction priceiv) allocate the transaction price to the performance obligations in the contractsv) recognize revenue when (or as) the entity satisfies a performance obligation.

Guidance is provided on topics such as the point in which revenue is recognized, accounting for variable consideration, costs of fulfilling and obtaining a contract and various related matters. New disclosures about revenue are also introduced.

The new standar replaces IAS 11 and IAS 18 and its interpretations (IFRIC 13, IFRIC 15, IFRIC 18 y SIC 31).


2018

IFRS 16 Leases

On January 13, 2016 the IASB has published a new standard, IFRS 16 “Leases”. The new standard brings most leases on-balance sheet for lessees under a single model, eliminating the distinction between operating and finance leases. Lessor accounting however remains largely unchanged and the distinction between operating and finance leases is retained. IFRS 16 supersedes IAS 17 “Leases” and related interpretations and is effective for periods beginning on or after 1 January 2019, with earlier adoption permitted if IFRS 15 “Revenue from Contracts with Customers” has also been applied.


2019

Amendments to Standards Effective dateSale or Contribution of Assets between an Investor and its Associate or Joint Venture (Amendments to IFRS 10 and IAS 28)

Clarify the treatment of the sale or contribution of assets from an investor to its associate or joint venture, as follows:

- Require full recognition in the investor’s financial statements of gains and losses arising on the sale or contribution of assets that constitute a business (as defined in IFRS 3 Business Combinations)- Require the partial recognition of gains and losses where the assets do not constitute a business, i.e. a gain or loss is recognized only to the extent of the unrelated investors’ interests in that associate or joint venture.

Effective date deferred

indefinitely

Recognition of Deferred Tax Assets for Unrealized Losses (Amendments to IAS 12)

On January 19, 2016, the IASB published final amendments to IAS 12 'Income Taxes'. The amendments clarify the following aspects:

• Unrealized losses on debt instruments measured at fair value and measured at cost for tax purposes give rise to a deductible temporary difference regardless of whether the debt instrument's holder expects to recover the carrying amount of the debt instrument by sale or by use.• The carrying amount of an asset does not limit the estimation of probable future taxable profits.• Estimates for future taxable profits exclude tax deductions resulting from the reversal of deductible temporary differences.• An entity assesses a deferred tax asset in combination with other deferred tax assets. Where tax law restricts the utilization of tax losses, an entity would assess a deferred tax asset in combination with other deferred tax assets of the same type.

Annual periods beginning on or after 1 January

2017

Disclosure Initiative (Amendments to IAS 7)

The amendments are part of the IASB´s Disclosure initiative project and introduce additional disclosure requirements intended to address investors´ concerns that financial statements do not currently enable them to understand the entity´s cash flows; particularly in respect of the management of financing activities. The amendments require disclosure of information enabling users of financial statements to evaluate changes in liabilities arising from financial activities. Although there is no specific format required to comply with the new requirements, the amendments include illustrative examples to show how an entity can meet the objective of these amendments


2017

Clarifications to IFRS 15 “Revenue from Contracts with Customers”

Amends IFRS 15 "Revenue from Contracts with Customers" to clarify three aspects of the standard (identifying performance obligations, principal versus agent considerations, and licensing) and to provide some transition relief for modified contracts and completed contracts.


2018

Classification and Measurement of Share-based Payment Transactions (Amendments to IFRS 2)

Clarify the classification and measurement of share-based payment transactions. The amendments address several requests that the IASB and the IFRS Interpretations Committee received and that the IASB decided to deal with in one combined narrow-scope project.


2018

Applying IFRS 9 'Financial Instruments' with IFRS 4 'Insurance Contracts' (Amendments to IFRS 4)

On September 12, 2016, the IASB has published 'Applying IFRS 9 'Financial Instruments' with IFRS 4 'Insurance Contracts''. The amendments are intended to address concerns about the different effective dates of IFRS 9 and the forthcoming new insurance contracts standard (expected as IFRS 17 within the next six months).


2018


Amendments to Standards Effective dateTransfers of Investment Property (Amendments to IAS 40)

On December 8, 2016, the IASB has issued “Transfers of Investment Property (Amendments to IAS 40)” to clarify transfers of property to, or from, investment property.

The amendments to IAS 40 Investment Property:• Amends paragraph 57 to state that an entity shall transfer a property to, or from, investment property when, and only when, there is evidence of a change in use. A change of use occurs if property meets, or ceases to meet, the definition of investment property. A change in management’s intentions for the use of a property by itself does not constitute evidence of a change in use.

• The list of examples of evidence in paragraph 57(a) – (d) is now presented as a non-exhaustive list of examples instead of the previous exhaustive list.


2018

Annual Improvements to IFRS Standards 2014-2016 Cycle (amendments IFRS 1, IFRS 12, and IAS 28)

IFRS 1 -Deleted the short-term exemptions in paragraphs E3–E7 of IFRS 1, because they have now served their intended purpose.

IFRS 12 - Clarified the scope of the standard by specifying that the disclosure requirements in the standard, except for those in paragraphs B10–B16, apply to an entity’s interests listed in paragraph 5 that are classified as held for sale, as held for distribution or as discontinued operations in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations.

IAS 28 - Clarified that the election to measure at fair value through profit or loss an investment in an associate or a joint venture that is held by an entity that is a venture capital organization, or other qualifying entity, is available for each investment in an associate or joint venture on an investment-by-investment basis, upon initial recognition.

The amendments to IFRS 1 and

IAS 28 are effective for

annual periods beginning on or

after January 1, 2018. The amendment

to IFRS 12 for annual periods beginning on or after January 1,

2017.

New Interpretations Effective dateIFRIC 22 Foreign Currency Transactions and Advance Consideration

On December 8, 2016, the IASB has issued IFRIC 22 “Foreign Currency Transactions and Advance Consideration” developed by the IFRS Interpretations Committee to clarify the accounting for transactions that include the receipt or payment of advance consideration in a foreign currency.


2018

Management is currently assessing the impact of applying IFRS 9, IFRS 15, IFRS 16 and IFRIC 22, however, it is not practicable to provide a reasonable estimate of the effects that these IFRSs will have until Management finalizes a detail review.

5. CASH AND CASH EQUIVALENTS

a) The details of this item are as follows:

12.31.2016 ThCh$

12.31.2015 ThCh$

Cash

Cash on hand 149,192 203,564

Cash on bank 26,828,216 25,240,217

Total cash 26,977,408 25,443,781

12.31.2016 ThCh$

12.31.2015 ThCh$

Cash equivalents

Short-term time deposits, classified as cash equivalents (c) 5,980,311 7,634,998

Short-term investment, classified as cash equivalent (mutual fund units) (d) 31,459,620 35,313,395

Total cash equivalents 37,439,931 42,948,393

Total cash and cash equivalents 64,417,339 68,392,174

Short-term time deposits mature in less than three months from their acquisition date and accrue interest at the market interest rate for this type of short-time investments.

The details of cash and cash equivalents by type of currency are as follows:

Currency Total cash and cash equivalents

12.31.2016 ThCh$

12.31.2015 ThCh$

Chilean pesos 34,042,094 37,492,869

U.S. dollars 19,320,768 18,606,961

Brazilian reais 5,065,348 4,839,588

Euro 857 941

Peruvian sol 255,785 196,376

Argentine peso 257,288 147,156

Colombian peso 671,127 362,684

Mexican peso 3,472,161 5,451,310

Other currencies 1,331,911 1,294,289

Total 64,417,339 68,392,174

b) Non-cash transactions

During the current year, SONDA and its subsidiaries were engaged in activities of non-monetary investment that are not reflected in the statement of cash flows for an amount of ThCh$207,407 as of December 31, 2016 (ThCh$472,599 as of December 31, 2015) corresponding to financed purchases of equipment for projects, for which payment is made within 24 to 36 months.

c) Short-term time deposits classified as cash equivalents:

Institution Currency 12.31.2016 ThCh$

12.31.2015 ThCh$

Banco Bradesco Brazilian reais 1,396,995 -

Banco Itau Brazilian reais 1,242,127 -

Banco Citibank U.S. dollars 1,072,020 852,893

JP Morgan U.S. dollars 1,037,902 1,122,042

HBSC Mexican peso 486,900 1,730,137

Banco Pichincha U.S. dollars 472,007 457,366

Banamex Mexican peso 185,022 3,058,965

Banco Do Brasil Brazilian reais 82,734 -

Banco Safra Brazilian reais 2,265 -

Jp Morgan Brazilian reais 1,563 -

Banco Regional de Brasilia Brazilian reais 776 -

Serfin Mexican peso - 36,855

Banco Santander Mexican peso - 376,740

5,980,311 7,634,998


d) Short-term investment classified as cash equivalents (mutual fund units):

Institution Currency 12.31.2016 ThCh$

12.31.2015 ThCh$

Santander Asset Management AGF S.A. Chilean pesos 11,450,751 11,613,471

Banco Estado Adm. Gral. De Fondos Chilean pesos 6,391,643 5,427,384

BCI Asset Management S.A. Chilean pesos 4,269,203 4,385,540

Scotia Fondos Mutuos Chilean pesos 4,005,569 5,435,546

BBVA Asset Mangement AGF S.A. Chilean pesos 3,504,533 2,000,387

Sura S.A. Chilean pesos 1,031,259 -

Banchile Corredores de Bolsa Chilean pesos 497,847 4,370,307

Euroamerica AGF S.A. Chilean pesos 305,997 -

Fiduciaria Corpbanca Colombian peso 1,031 4,338

Fiduciaria Credicorp Colombian peso 667 1,410

BCI Asset Management S.A. U.S. dollars 639 7,724

Fiduciaria GNB Colombian peso 481 609

Banco Bradesco Brazilian reais - 112,227

Banco Regional de Brasilia Brazilian reais - 723

Banco Do Brasil Brazilian reais - 88,891

Banco Itau Brazilian reais - 1,561,211

Banco Santander Brazilian reais - 289,667

Caixa Económica Federal Brazilian reais - 10,712

Fiduciaria De Occidente Colombian peso - 3,248

31,459,620 35,313,395

6. OTHER FINANCIAL ASSETS

As described in Note 3.2 n), the details of other financial assets are as follows:

Current Non - current 12.31.2016

ThCh$12.31.2015

ThCh$ 12.31.2016

ThCh$12.31.2015

ThCh$Financial instruments at fair value (1) 2,104,940 330,797 99,981 -

Investments in unlisted shares - - 948,250 960,771

Guarantee deposits - - 3,208,177 1,945,854

Hedging assets 39,124 - - -

Earn out (2) 1,332,272 1,322,190 - -

Third party account receivables (3) 23,571,070 - - -

Option rights (4) - - 4,013,285 -

Other financial assets 42,773 67,261 48 50

Total 27,090,179 1,720,248 8,269,741 2,906,675

(1) These investments correspond to equity instruments (shares). Changes in fair value of these instruments are recognized in profit or loss. The details are as follows:

Institution Type of instrument Currency

Current Non Current 12.31.2016

ThCh$ 12.31.2015

ThCh$ 12.31.2016

ThCh$ 12.31.2015

ThCh$ BTG Pactual Shares US$ 193,255 330,797 - -

Valores Mobiliários Securities Brazilian

reais 1,911,685 - 99,981 -

2,104,940 330,797 99,981 -

(2) Corresponds to current account balances on which SONDA S.A. is accountable to third parties. These balances are restricted from use. The origin of these balances is related to the normal operations of the Company and management commitments.

(3) Corresponds to an agreed loan contract between the subsidiaries Sonda Procwork Outsourcing Ing. Ltda., Ativas Participações S.A. and Cemig Telecomunicações S.A., whereby Sonda loans these two companies an amount of R$ 110.5 million, which is due in October 2017. This account generates interest of 110% of CDI, (Interbank CD) with a limit of 12% per year plus inflation, and is guaranteed by the partners.

(4) As informed in Note 3.2 to 9), together with the purchase of Ativas Datacenter S.A., the company signed a CALL option contract which grants SONDA the right to purchase the minority shareholder rights in the company. The valuation for this operation has been carried out at fair value, as indicated in Note 3.2 n).

7. TRADE AND OTHER RECEIVABLES

a) The detail of trade and other receivables is as follows:

12.31.2016 ThCh$

12.31.2015 ThCh$

Trade receivables, gross 213,655,483 242,434,024

Impairment allowance on trade receivables (15,014,646) (10,169,610)

Trade and other receivables, current 198,640,837 232,264,414

Trade receivables, gross 24,455,534 16,560,559

Impairment allowance on trade receivables - -

Non-current receivables 24,455,534 16,560,559

Total Trade and other receivables 223,096,371 248,824,973


b) The detail is as follows:

Trade and other receivables December 31, 2016 December 31, 2015

Current Non-current Current Non-current ThCh$ ThCh$ ThCh$ ThCh$

Trade receivables, gross 132,221,186 1,841,750 159,145,820 1,253,029

Impairment allowance on trade receivables (13,681,565) - (8,587,040) -

Lease receivables, gross 16,632,089 22,295,362 15,629,368 14,591,299

Unbilled revenue 43,572,428 280,559 52,477,506 567,252

Checks, gross 7,614,729 - 9,797,171 -

Notes and Promissory notes, gross 656,224 37,863 783,061 148,979

Impairment allowance on notes receivable (1,333,081) - (1,582,570) -

Loans and advances to employees 1,435,476 - 1,160,267 -

Other 11,523,351 - 3,440,831 -

Total 198,640,837 24,455,534 232,264,414 16,560,559

c) The tables below set forth the trade and other receivables as of December 31, 2016 and 2015 classified by aging:

Trade and other receivables

December 31, 2016 Total Non-

current Non past due

Aging 0-30 days

Aging 31-60 days

Aging 61-90 days

Aging 91-120

days

Aging 121-150

days

Aging 151-180

days

Aging 181-210

days

Aging 211-250

days

Aging 251-360

days

Aging more than 361 days

Total Current

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Trade receivables, gross

90,475,116 16,344,861 5,524,270 2,572,032 1,069,590 933,910 974,230 389,334 468,828 1,253,863 12,215,152 132,221,186 1,841,750

Impairment allowance on trade receivables

- - - - (133,590) (142,551) (134,259) (194,667) (234,415) (626,931) (12,215,152) (13,681,565) -

Lease receivables, gross

16,632,089 - - - - - - - - - - 16,632,089 22,295,362

Unbilled revenue 39,984,117 2,343,519 413,444 253,731 131,605 89,898 80,893 152,366 - 122,855 - 43,572,428 280,559

Checks, gross 6,755,719 - - - - - - - - 12,269 846,741 7,614,729 -

Notes and Promissory notes, gross

182,153 1,408 - - - - - - - - 472,663 656,224 37,863

Impairment allowance on notes receivable

- (1,408) - - - - - - - (12,269) (1,319,404) (1,333,081) -

Loans and advances to employees

1,435,476 - - - - - - - - - - 1,435,476 -

Other 11,523,351 - - - - - - - - - - 11,523,351 -

Total 166,988,021 18,688,380 5,937,714 2,825,763 1,067,605 881,257 920,864 347,033 234,413 749,787 - 198,640,837 24,455,534


Trade and other receivables

December 31, 2015

Non past due

Aging 0-30 days

Aging 31-60 days

Aging 61-90 days

Aging 91-120

days

Aging 121-150

days

Aging 151-180

days

Aging 181-210

days

Aging 211-250

days

Aging 251-360

days

Aging more than 361 days

Total Current

Total Non-current

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Trade receivables, gross 111,705,380 23,811,742 7,244,371 3,933,016 1,711,142 841,849 766,208 618,868 785,172 496,242 7,231,830 159,145,820 1,253,029

Impairment allowance on trade receivables

- - - - (156,365) (122,445) (125,941) (309,434) (392,586) (248,439) (7,231,830) (8,587,040) -

Lease receivables, gross 15,629,368 - - - - - - - - - - 15,629,368 14,591,299

Unbilled revenue 42,622,721 6,020,630 1,890,582 682,956 462,372 165,991 163,493 169,117 - 299,644 - 52,477,506 567,252

Checks, gross 8,766,070 - - - - - - - - 33,302 997,799 9,797,171 -

Notes and Promissory notes, gross 231,592 - - - - - - - - - 551,469 783,061 148,979

Impairment allowance on notes receivable

- - - - - - - - - (33,302) (1,549,268) (1,582,570) -

Loans and advances to employees 1,160,267 - - - - - - - - - - 1,160,267 -

Other 3,440,831 - - - - - - - - - - 3,440,831 -

Total 183,556,229 29,832,372 9,134,953 4,615,972 2,017,149 885,395 803,760 478,551 392,586 547,447 - 232,264,414 16,560,559

d) The changes in the allowance for impairment losses of trade receivables determined as described in Note 3.2j) were as follows:

Movements in the impairment allowance for trade receivables Current Non-Current ThCh$ ThCh$

Balance - January 1, 2015 10,527,433 -

Increase (decrease) for the year (648,576) -

Foreign currency translation differences 290,753 -

Balance - December 31, 2015 10,169,610 -

Acquisitions through business combinations 45,383 -

Increase for the year 4,240,611 -

Write - offs (590) -

Foreign currency translation differences 559,632 -

Balance - December 31, 2016 15,014,646 -

SONDA S.A. and subsidiaries has a defined credit policy, under which assessments are made of each client's financial, commercial and tax situation (financial statement analysis), historical payment behaviors, market positioning.

The Company does not present significant renegotiations in its debtors by sales, but if it is carried out, these are evaluated under the new financial situation of the client, carrying out the relevant impairment analysis.


e) At the end of each year, the information relating to non-renegotiated and negotiated portfolio of customers, is as follows:

Time in arrears

12.31.2016 12.31.2015

Number of customers

- Non-renegotiated

portfolio

Non-renegotiated

portfolio, gross

Number of customers -

Renegotiated portflio

Renegotiated

portfolio, gross

Total portfolio, gross(*)

Number of customers

- Non-renegotiated

portfolio

Non-renegotiated

portfolio, gross

Number of customers -

Renegotiated portflio

Renegotiated

portfolio, gross

Total portfolio, gross(*)

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Up to date 11,327 188,175,629 11 3,267,926 191,443,555 9,516 180,092,962 16 386,496 180,479,458

0-30 days 3,060 18,678,967 4 10,821 18,689,788 8,050 46,825,635 10 47,941 46,873,576

31 - 60 days 1,254 5,921,831 4 15,883 5,937,714 1,975 10,118,428 5 43,924 10,162,352

61 - 90 days 702 2,803,301 5 22,462 2,825,763 1,032 4,670,426 4 10,889 4,681,315

91 - 120 days 482 1,181,403 4 19,792 1,201,195 620 2,360,429 4 10,889 2,371,318

121 - 150 days 341 1,009,580 4 14,228 1,023,808 678 1,073,578 3 10,444 1,084,022

151 - 180 days 339 1,047,991 3 7,132 1,055,123 254 832,020 1 2,755 834,775

181 - 210 days 258 534,780 3 6,920 541,700 293 1,235,581 - - 1,235,581

211 - 250 days 469 462,116 3 6,712 468,828 202 1,034,749 - - 1,034,749

More than 250 days 2,056 14,861,535 7 62,008 14,923,543 1,878 10,166,996 4 70,441 10,237,437

Total 234,677,133 3,433,884 238,111,017 258,410,804 583,779 258,994,583

(*) The customer portfolio consists of bills receivable, lease receivables, debtors bill, checks, bills, promissory notes, loans and advances to employees and other accounts receivable, gross value (before applying estimates of uncollectible). Credit terms are determined in accordance with a policy approved for each company. When a customer has payment problems coupled with a deterioration of their overall economic situation, the renegotiation process aims at the recovery of the total amount owed; the customer is offered a new payment schedule and extended credit terms. There is a requirement of an initial down payment, guarantees, and interest charges. This analysis is carried out on an individual basis for each customer. It should be mentioned that this type or renegotiation is not a common practice at SONDA given the good payment record of its customers.

Portfolio in default and in legal collection process

12.31.2016 12.31.2015

Number of customers

Portfolio in default and in legal

collection process Number of customers

Portfolio in default and in legal collection process

ThCh$ ThCh$ Notes receivable in default (**) 70 347,277 117 508,736

Notes receivable in legal collection process (**) 316 4,118,979 175 3,391,338

(**)It includes documents (checks, bills) and bills.

8. BALANCES AND TRANSACTIONS WITH RELATED COMPANIES

The transactions between the Company and its related companies are customary transactions in terms of their objective and conditions. These transactions have been eliminated in the consolidation process and therefore are not disclosed in this note.


The balances of receivables and payables between the Company and its unconsolidated related parties are as follows:

a) Transactions, Account receivables and payables with related companies

Name of related party Taxpayer Country Type of currency Nature of relationship

Balances with related companies Transactions with related companies

12.31.2016 12.31.2016

Accounts receivable

current

Accounts receivable

non-current

Accounts payable current

Accounts payable

non-current

Cost of services

Revenue of services

Financial transfers

under agreements to/from the Company)

(without effect in profit or

loss)

Indico S.A. (3) 88.492.000-0 Chile Chilean pesos Controlling shareholder - - 642,064 - - - -

Inversiones Yuste S.A. (3) 96.688.520-3 Chile Chilean pesos Controlling shareholder - - 75,941 - - - -

Subtotal transactions with controlling shareholder - - 718,005 - - - -

Inversiones Industriales Valparaíso S.A. (2) 96.831.860-8 Chile UF Associate - 909,662 - - - - -

Multicaja S.A. 76.828.790-2 Chile Chilean pesos Associate 24,447 - - - - 131,399 -

Subtotal transactions with associate 24,447 909,662 - - - 131,399 -

Brazilian key executives (4) Brazil Reales Brazil Executives 108,367 2,451,310 - 49,149 766,296 - -

Chilean key executives Chile Chilean pesos Executives - - 9,238 - 1,218,188 - -

Uruguayan key executives Uruguay Dólares Executives - - 4,352 - - 521 -

Board of Directors Chile Chilean pesos Executives - - - - 255,723 70 -

Inversiones Robinson Ltda. 78.380.860-9 Chile Chilean pesos Indirect through director - - - - 239,417 - -

Subtotal transtions with key management 108,367 2,451,310 13,590 49,149 2,479,624 591 -

Adm. Financiero Transantiago S.A. (1) 99.597.320-0 Chile Chilean pesos Investee 2,418,540 - - - - 28,544,323 -

AFP Modelo S.A. 76.762.250-3 Chile Chilean pesos Indirect through shareholder 390,890 - - - - 1,435,785 -

Banco Internacional S.A 97.011.000-3 Chile Chilean pesos Indirect through shareholder 72,913 - - - 9 531,273 -

Coasin Chile S.A. 82.049.000-2 Chile Chilean pesos Indirect through shareholder 13,225 - - - 14,838 269,006 -

Constructora Aconcagua S.A. 86.856.700-7 Chile Chilean pesos Indirect through shareholder 420 - - - - - -

Salmones Sur Austral 79.559.220-2 Chile Chilean pesos Indirect through shareholder 3,668 - - - - - -

Serv. Compartidos Atlántico 76.003.014-7 Chile Chilean pesos Indirect through shareholder 12,778 - - - - 127,053 -

Tecnología Desarr e Inv. Ltda. 76.872.080-0 Chile Chilean pesos Indirect through shareholder - - - 15,673 - - -

Etcheberry y Asesorias y Negocios Ltda. (5) 77.522.100-3 Chile Chilean pesos Indirect through

associate - 970,339 - - - - -

Subtotal transactions with other related companies 2,912,434 970,339 - 15,673 14,847 30,907,440 -

Total transaction with related companies 3,045,248 4,331,311 731,595 64,822 2,494,471 31,039,430 -


Name of related party Taxpayer Country Type of currency Nature of relationship

Balances with related companies Transactions with related companies

12.31.2015 12.31.2015

Accounts receivable

current

Accounts receivable

non-current

Accounts payable current

Accounts payable

non-current

Cost of services

Revenue of services

Financial transfers

under agreements to/from the Company)(without

effect in profit or loss)

Indico S.A. (3) 88.492.000-0 Chile Chilean pesos Controlling shareholder - - 4,774,590 - - - -

Inversiones Yuste S.A. (3) 96.688.520-3 Chile Chilean pesos Controlling shareholder - - 408,650 - - - -

Subtotal transactions with controlling shareholder - - 5,183,240 - - - -

Inversiones Industriales Valparaíso S.A. (2) 96.831.860-8 Chile UF Associate - 884,026 - - - - 200,000

Multicaja S.A. 76.828.790-2 Chile Chilean pesos Associate - - - - - 13,385 -

Subtotal transactions with associate - 884,026 - - - 13,385 200,000

Brazilian key executives (4) Brazil Reales Brazil Executives 263,157 1,598,437 - 42,580 929,366 - -

Chilean key executives Chile Chilean pesos Executives 2,642 - 14,964 - 1,164,622 241 -

Uruguayan executives Uruguay Dólares Executives - - 5,326 - - - -

Board of Directors Chile Chilean pesos Executives - - - - 245,183 - -

Inversiones Robinson Ltda. 78.380.860-9 Chile Chilean pesos Executives - - - - 211,111 - -

Subtotal transtions with key management 265,799 1,598,437 20,290 42,580 2,550,282 241 -

Adm. Financiero Transantiago S.A. (1) 99.597.320-0 Chile Chilean pesos Investee 2,319,432 - - - - 27,250,961 -

AFP Modelo S.A. 76.762.250-3 Chile Chilean pesos Indirect through shareholder 244,055 - - - - 1,311,101 -

Banco Internacional S.A 97.011.000-3 Chile Chilean pesos Indirect through shareholder 78,541 - - - 42 604,817 -

Coasin Chile S.A. 82.049.000-2 Chile Chilean pesos Indirect through shareholder 91,593 - - - 315 345,331 -

Ediciones Financieras S.A. 96.539.380-3 Chile Chilean pesos Indirect through shareholder 49,817 - 2,594 - -

Mercado Mayorista de Santiago 96.779.500-3 Chile Chilean pesos Indirect through subsidiary - - 3,962 - 6,806 - -

Salmones Pacific Star S.A. 79.559.220-2 Chile Chilean pesos Indirect through shareholder 6,967 - - - 1,389 19,367 -

Serv. Compartidos Atlántico 76.003.014-7 Chile Chilean pesos Indirect through shareholder 33,335 - - - - 145,340 -

Tecnologia Desarr.e Inv. Ltda. 76.872.080-0 Chile Chilean pesos Indirect through subsidiary - - - 29,390 - - -

Etcheberry y Asesorias y Negocios Ltda. (5) 77.522.100-3 Chile Chilean pesos Indirect through associate - 889,854 - - - - -

Subtotal transactions with other related companies 2,823,740 889,854 3,962 29,390 11,146 29,676,917 -

Total transaction with related companies 3,089,539 3,372,317 5,207,492 71,970 2,561,428 29,690,543 200,000

(1) See description of contract agreement in Note 33 II a)(2) Corresponds to an account receivable due to a capital decrease in 2004 made by this associate. This account receivable is denominated in UF does not bear interest and has no maturity.(3) Correspond to the minimum dividend recognized in accordance with SONDA’s dividend distribution policy.

The companies Inversiones Pacifico II Ltda., Inversiones Santa Isabel Ltda., Inversiones Atlantic Ltda. and Inversiones Yuste SA, were the owners of 408,346,011 shares representing 46.87% of the 871,057,175 total shares issued by Sonda S.A.

On February 13, 2015, the companies mentioned above contributed 100% of its shares to the company Indico S.A.

During 2016 the company paid dividends to its controlling shareholders of ThCh$9,675,296 (ThCh$9,812,820 in 2015).

(4) Account receivable mainly correspond to the escrow account associated agreed in sale agreement of the company CTIS.

(5) Corresponds to an account receivable generated in December 2015. This account receivable is denominated in UF, it bears a 5.75% annual interest rate; to be paid in one installment in December 2020. This loan has a pledge on behalf of SONDA S.A.


At December 31, 2016 and 2015, the Company has not experienced an impairment of accounts receivables from related parties. This evaluation is carried out at the close of each accounting period when reviewing the financial position with related parties in markets in which these operate. Interest is charged on the unpaid balances.

At December 31, 2016 and 2015, the Company does not have guarantees, either delivered or received, with related parties and which have not been disclosed.

All the transactions have been carried out at market values and are included in operating revenue and costs.

The Company’s disclosure criterion is for all the transactions over ThCh$100,000. With the exception of the existence of accounts receivable or payable, these are disclosed independently of their value.

b) Management and Key Management

Key management members and other individuals responsible for the management of SONDA S.A., as well as, the shareholders or representative natural persons or legal persons, have not been involved in unusual transactions as of December 31, 2016 and 2015.

The Company is managed by a Board of Directors including nine directors elected for a three-year period after with they can be reelected.

c) Directors’ Committee

In accordance with Article 50 bis of Corporations Law N.18046, SONDA S.A. and its subsidiaries have a Directors’ Committee consisting of three members who have the powers established in Corporations Law.

d) Remunerations for the Board of Directors and Directors’ Committee members

12.31.2016 12.31.2015 ThCh$ ThCh$ ThCh$ ThCh$

Directors Per diem (1) Other (2) Per diem (1) Other (2)

Mario Pavón Robinson 46,852 239,417 43,910 211,111

María del Rosario Navarro Betteley 21,462 - 25,635 -

Pablo Navarro Haeussler 23,426 - 21,954 -

Christian Samsing Stambuk 23,426 - 21,955 -

Jaime Pacheco Matte 23,426 47,576 21,955 47,576

Juan Antonio Guzmán 31,235 - 29,273 -

Mateo Budinich Diez 31,235 - 29,273 -

Hernan Marió Lores 31,235 - 29,273 -

Francisco Gutierrez Philippi 23,426 - 21,955 -

Total 255,723 286,993 245,183 258,687(1) Includes attendance to the Board of Directors’ and Directors’ Committee meetings.(2) Corresponds to payments for services established by contract.

9. INVENTORIES

The detail of inventories (net of obsolescence allowance) is as follows:

Inventories 12.31.2016 12.31.2015

ThCh$ ThCh$ Class of inventories

Goods (1) 31,169,493 31,693,957

Supplies for rendering of services 2,188,749 4,220,621

Spare parts 944,598 1,296,528

Other inventories

Implementation projects 782,706 1,840,499

Imports in transit 5,112,929 3,429,130

Subtotal other inventories 5,895,635 5,269,629

Total inventories 40,198,475 42,480,735(1) Includes Computer and Software equipment for sale.

The cost of inventories recognized as “Cost of sales” was ThCh$257,168,619 for the year ended December 31, 2016 (ThCh$283,773,766 for the year ended December 31, 2015).

The obsolescence allowance which is presented as a deduction of inventories was ThCh$5,860,699 as of December 31, 2016 (ThCh$5,949,159 as of December 31, 2015).

There are no significant gains or losses for inventory write downs.

There are no inventories pledged as security for liabilities.

10. CURRENT TAX ASSETS AND LIABILITIES

a) The details of current tax assets is as follows:

Current tax assets12.31.2016 12.31.2015

ThCh$ ThCh$ Monthly provisional payments 21,156,030 12,178,276

Credit for tax benefis (1) 7,499,829 535,498

Taxes on sales and services 6,077,531 5,974,218

Other 2,583,434 1,189,434

Total 37,316,824 19,877,426(1) Includes a credit to be recovered by the PARS subsidiary of Th$3,315,760 (See Note 18)


b) The details of current tax liabilities is as follows:

Current tax liabilities 12.31.2016 12.31.2015

ThCh$ ThCh$ Income tax 771,902 11,788,506

Taxes on sales and services 7,814,843 10,297,249

Others 1,500 1,030

Total 8,588,245 22,086,785

11. INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

i. The following tables set forth the companies accounted for using equity method:

Taxpayer number Company Name Country Functional

Currency Activity Ownership percentage

Balance at Purchases

Share of Profit (loss)

Dividends received

Other increases

(descreases)

Carrying amount of investment

01.01.2016 12.31.2016 ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

96.831.860-8 Inversiones Valparaíso S.A. Chile Chilean peso Real State 33.33% 173,146 - (66,917) - (6,277) 99,952

96.941.290-k Sustentable S.A. Chile Chilean peso Consulting and environmental management 20.96% 84,678 - 18,831 - 16,307 119,816

76.828.790-2 Multicaja S.A. Chile Chilean peso Connectivity payments 41.58% 5,460,896 - 57,716 - - 5,518,612

5,718,720 - 9,630 - 10,030 5,738,380

Taxpayer number Company Name Country Functional

Currency Activity Ownership percentage

Balance at Purchases

Share of Profit (loss)

Dividends received

Other increases

(descreases)

Carrying amount of investment

01.01.2015 12.31.2015

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

96.831.860-8 Inversiones Valparaíso S.A. Chile Chilean peso Real State 33.33% 122,698 - 102,182 - (51,734) 173,146

96.941.290-k Sustentable S.A. Chile Chilean peso Consulting and environmental management 20.96% 122,735 - (23,166) (10,372) (4,519) 84,678

76.828.790-2 Multicaja S.A. (1) Chile Chilean peso Connectivity payments 41.58% 3,727,581 1,489,493 243,830 - (8) 5,460,896

3,973,014 1,489,493 322,846 (10,372) (56,261) 5,718,720

(1) On December 17, 2015, Consorcio Inversiones Dos Ltda. sold, assigned and transferred 13,651 ordinary, registered shares of a single series, with no par value in a total price of ThCh$1,489,493, which Sonda S.A. paid in cash on that date. As of December 31, 2015, Sonda S.A. owns 74,614 shares of the company Multicaja S.A. equivalent to a 41.58% the total interests.

ii. The financial information corresponding to the most significant associate is as follows:

Name Country Functional Currency

12.31.2016

Financial Statements

Current Assets

Non-current Assets

Current Liabilities

Non-current

liabilities

Non-controlling

interests Revenue Profit (loss)

Profit (Loss) attributable to non-controlling

interests ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Multicaja S.A. Chile CLP Consolidated 10,659,647 11,708,872 9,155,356 1,859,096 604 171,466,145 241,677 102,873

Name Country

Functional Currency

12.31.2015

Financial Statements Current Assets

Non-current Assets

Current Liabilities

Non-current

liabilities Non-controlling

interests Revenue Profit (loss)

Profit (Loss) attributable to

non-controlling interests

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Multicaja S.A. Chile CLP Consolidated 11,589,531 10,630,027 9,329,181 1,163,131 512,587 180,756,356 918,675 213,701


12. INTANGIBLE ASSETS OTHER THAN GOODWILL

a) The following table sets forth intangible assets other than goodwill as of December 2016 and 2015:

12.31.2016 12.31.2015

ThCh$ ThCh$

Intangible assets other than goodwill

Expenditures for development of tailor-made projects (1) 3,755,580 5,258,175

Expenditure for development of the Company´s software products 6,793,611 3,428,958

Subtotal Capitalized expenditures for development 10,549,191 8,687,133

Trademark (2) 1,526 18,909

Acquired Software 3,766,669 1,172,603

Licenses 1,306,411 542,481

Customer-related intangible assets (2) 13,607,000 13,974,425

Value of business acquired (2) 1,171,887 1,492,048

Other identifiable assets 1,580,343 1,060,606

Subtotal intangible assets, not internally generated 21,433,836 18,261,072

Total other intangible assets other than goodwill 31,983,027 26,948,205

(1) Correspond to development and implementation costs for the Transantiago Project. (See Note 33 II a).(2) Correspond to intangible assets acquired in business combinations. (See more details in Note 3.2 f). The determination of their fair value was made by third parties. The useful lives have been assigned according to the long term business plan, establishing a useful life between 4 to 15 years.

b) The composition and movement of intangible assets other than goodwill at the end of each year is as follows:

Expenditures for

development of tailor-made

projects

Expenditure for

development of the

Company´s software products Trademark

Acquired Software Licenses

Customer-related

intangible assets

Value of business acquired

Other identifiable

assets Total

Movements in intangible assets Gross amount ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Balance at 01.01.2016 16,136,638 16,172,515 503,695 2,178,432 3,330,082 25,269,920 2,135,120 1,540,755 67,267,157

Additions 407,780 4,375,336 - 31,626 712,617 - - 239,821 5,767,180

Acquisitions through business combinations (2) - - - 7,935,582 - - - - 7,935,582

Effect of foreign currency exchange differences (58,754) 1,308,791 163,197 349,359 558,478 3,913,973 (129,102) 102,789 6,208,731

Increase (decrease) for transfers - - - 50,038 - - - (50,038) -

Increase (decrease) for other changes - - - - 584,118 - - - 584,118

Disposals - - - (138,520) (1,310) - - - (139,830)

Total movements in identifiable intangible asets 349,026 5,684,127 163,197 8,228,085 1,853,903 3,913,973 (129,102) 292,572 20,355,781

Balance at 12.31.2016 16,485,664 21,856,642 666,892 10,406,517 5,183,985 29,183,893 2,006,018 1,833,327 87,622,938

Accumulated amortization

Balance at 01.01.2016 (10,878,463) (12,743,557) (484,786) (1,005,829) (2,787,601) (11,295,495) (643,072) (480,149) (40,318,952)

Amortization expense (1,959,882) (1,539,582) (17,985) (511,987) (486,714) (2,211,814) (246,094) (35,947) (7,010,005)

Acquisitions through business combinations s (2) - - - (4,995,728) - - - - (4,995,728)

Effect of foreign currency exchange differences 108,261 (779,892) (162,595) (264,824) (491,172) (1,893,805) 55,035 263,112 (3,165,880)

Increase (decrease) for transfers and other changes - - - - (113,019) (175,779) - - (288,798)

Disposals - - - 138,520 932 - - - 139,452

Total movements in identifiable intangible asets (1,851,621) (2,319,474) (180,580) (5,634,019) (1,089,973) (4,281,398) (191,059) 227,165 (15,320,959)

Balance at 12.31.2016 (12,730,084) (15,063,031) (665,366) (6,639,848) (3,877,574) (15,576,893) (834,131) (252,984) (55,639,911)

Net Balance at 12.31.2016 3,755,580 6,793,611 1,526 3,766,669 1,306,411 13,607,000 1,171,887 1,580,343 31,983,027


Expenditures for

development of tailor-made

projects

Expenditure for

development of the

Company´s software products Trademark

Acquired Software Licenses

Customer-related

intangible assets

Value of business acquired

Other identifiable

assets Total

Movements in intangible assets ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Gross amount

Balance at 01.01.2015 16,078,173 16,778,626 738,605 4,105,139 3,641,149 32,370,317 1,804,770 1,771,332 77,288,111

Additions 61,630 1,699,284 - 1,253,313 635,426 - - 48,394 3,698,047

Effect of foreign currency exchange differences (3,165) (2,304,654) (234,910) (667,978) (864,611) (7,100,397) 330,350 (279,788) (11,125,153)

Increase (decrease) for transfers and other changes - - - (2,373,705) - - - - (2,373,705)

Disposals - (741) - (138,337) (81,882) - - 817 (220,143)

Total movements in identifiable intangible asets 58,465 (606,111) (234,910) (1,926,707) (311,067) (7,100,397) 330,350 (230,577) (10,020,954)

Balance at 12.31.2015 16,136,638 16,172,515 503,695 2,178,432 3,330,082 25,269,920 2,135,120 1,540,755 67,267,157

Accumulated amortization

Balance at 01.01.2015 (9,128,156) (12,773,852) (643,908) (3,299,611) (3,226,212) (9,647,129) (290,828) (449,189) (39,458,885)

Amortization expense (1,738,174) (1,479,148) (61,710) (371,731) (357,041) (4,206,682) (258,394) (30,826) (8,503,706)

Effect of foreign currency exchange differences - - - - - - - - -

Increase (decrease) for transfers and other changes (12,133) 1,509,175 220,832 536,901 713,770 2,558,316 (93,850) (134) 5,432,877

Disposals - - - 1,990,276 - - - - 1,990,276

Total movements in identifiable intangible asets - 268 - 138,336 81,882 - - - 220,486

Total movimientos (1,750,307) 30,295 159,122 2,293,782 438,611 (1,648,366) (352,244) (30,960) (860,067)

Balance at 12.31.2015 (10,878,463) (12,743,557) (484,786) (1,005,829) (2,787,601) (11,295,495) (643,072) (480,149) (40,318,952)

Net Balance at 12.31.2015 5,258,175 3,428,958 18,909 1,172,603 542,481 13,974,425 1,492,048 1,060,606 26,948,205

c) Amortization Expense

The charge to profit and loss at December 31, 2016 in this regard amounts to ThCh$7,010,005 (ThCh$8,503,706 at December 31, 2015), under the caption “cost of sales”.

d) SONDA does not have totally amortized intangible assets.

e) SONDA has not made material disbursements for Research and Development which have been recorded as expenses.


13. GOODWILL

The following table sets forth the reconciliation of the carrying amounts of goodwill as of December 31, 2016 and 2015.

Based on the results of the impairment tests performed by the management of SONDA S.A., no impairment loss of goodwill was recognized.

Name Taxpayer number

12.31.2015 12.31.2016

Balance at Foreign currency translation difference

Goodwilln as of

Acquisitions

Foreign currency translation difference

Goodwill as of

01.01.2015 12.31.2015 12.31.2016 ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Acepta.com S.A. 96.919.050-8 45,278 - 45,278 - - 45,278

ATIVAS DataCenter S.A. Foreign - - - 3,477,435 (91,949) 3,385,486

Bac Financiero (absorbida por Sonda Serv. Profesionales S.A.) 96.917.050-7 556,029 - 556,029 - (8,802) 547,227

Ceitech (absorbida por Sonda Argentina S.A.) (1) Foreign 2,459,297 (562,066) 1,897,231 - (432,143) 1,465,088

CTIS Tecnología S.A. (1) Foreign 69,364,181 (15,181,296) 54,182,885 - 8,359,437 62,542,322

ELUCID Solutions S.A. (1) Foreign 25,813,504 (5,649,644) 20,163,860 - 3,110,954 23,274,814

Finsoft S.A. (absorbida por Sonda S.A.) 96.771.760-6 71,484 - 71,484 - - 71,484

IDC Soluc. Informáticas S.A. (absorbida por Sonda S.A.) 96.535.540-5 378,486 - 378,486 - - 378,486

Ingeniería en Servicios de Informatica, S.A. de C.V. (México) (1) Foreign 119,865 9,373 129,238 - 14,162 143,400

Inversiones Colombia Ltda. Foreign 66,938 - 66,938 - - 66,938

Kaizen Inf e Partic. Soc. Ltda. (absorbida por Telsinc Ltda.) (1) Foreign 2,591,127 (567,104) 2,024,023 - 312,270 2,336,293

Nextira One S.A. (1) (fusionada por Sonda México) Foreign 19,269,296 3,284,117 22,553,413 - (1,292,242) 21,261,171

Orden S.A. 94.071.000-6 993,199 - 993,199 - - 993,199

PARS Produtos de Processamento de Dados Ltda. (1) Foreign 29,001,039 (6,347,273) 22,653,766 - 3,495,065 26,148,831

Plaut Systems & Solutions (absorbida por Sonda Procwork) (1) Foreign 471,164 (103,121) 368,043 - 56,782 424,825

Quintec Colombia Ltda. (fusionada por Sonda de Colombia) Foreign 1,389,251 - 1,389,251 - - 1,389,251

Quintec MacStore Foreign 545,353 - 545,353 - - 545,353

Quintec S.A. (absorbida por Quintec Filiales Operativas S.A.) 96.629.520-1 19,037,057 - 19,037,057 - 1,000 19,038,057

Red Colombia S.A. (fusionada por Sonda de Colombia) (1) Foreign 5,572,301 (668,676) 4,903,625 - 15,401 4,919,026

Servibanca S.A. 96.571.690-4 119,477 - 119,477 - - 119,477

Servicios de Aplicación e Ing. Novis, S.A. de C.V.(México) (1) Foreign 164,220 12,842 177,062 - 19,401 196,463

Servicios Educacionales Sonda S.A. 78.072.130-8 647 - 647 - - 647

Soft Team Sist. De Comp. E Inf. Ltda (absorbida por Sonda do Brasil) (1) Foreign 1,722,822 (377,063) 1,345,759 - 207,626 1,553,385

Sonda Bancos S.A (absorbida por Sonda Serv. Profesionales S.A.) 78.534.270-4 674,802 - 674,802 - - 674,802

Sonda de Colombia S.A (1) Foreign 207,091 (24,851) 182,240 - - 182,240

Sonda del Perú S.A. (1) Foreign 59,270 2,091 61,361 - (3,738) 57,623

Sonda do Brasil S.A. (Imarés TI Tecn. Da Inf.Ltda.) (1) Foreign 4,110,864 (899,719) 3,211,145 - 495,422 3,706,567

Sonda do Brasil S.A. (Vía On line) (1) Foreign 476 (104) 372 - 57 429

Sonda Ecuador (1) Foreign 47,763 8,140 55,903 - (3,202) 52,701

Sonda México S.A. (1) Foreign 6,116,152 1,979,211 8,095,363 - (1,572,769) 6,522,594

Sonda Procwork Inf. Ltda. (1) Foreign 51,242,729 (11,215,170) 40,027,559 - 6,175,527 46,203,086

Sonda Uruguay (Setco Uruguay) (1) Foreign 221,796 37,801 259,597 - 23,611 283,208

Sonda Uruguay S.A. (1) Foreign 381,001 27,305 408,306 - (86,043) 322,263

Tecnoglobal S.A. 96.823.020-4 495,162 84,392 579,554 - (33,206) 546,348

Telsinc Prest. De Serv. Para sist. De Inf. Ltda. (1) Foreign 14,833,787 (3,256,556) 11,577,231 - 1,797,741 13,374,972

Total 258,142,908 (39,407,371) 218,735,537 3,477,435 20,560,362 242,773,334

(1) Goodwill from foreign operations is measured as described in Note 3.2 (f).

The Company has determined the goodwill in the acquisition of these companies in accordance with the requirements of IFRS 3 (2008).


14. PROPERTY, PLANT AND EQUIPMENT

a) Property, plant and equipment as of December 31, 2016 and 2015 is as follows:

Classes of property, plant and equipment, net

12.31.2016 12.31.2015

Gross amount Accumulated depreciation Net amount Gross amount

Accumulated depreciation Net amount

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Land 8,587,115 - 8,587,115 5,812,391 - 5,812,391

Buildings 75,413,282 12,794,044 62,619,238 52,387,169 8,845,927 43,541,242

Construction 2,775,533 696,857 2,078,676 2,832,292 534,262 2,298,030

Vehicle 807,613 549,383 258,230 723,372 510,715 212,657

Office equipment 13,345,362 9,091,660 4,253,702 10,883,510 7,816,778 3,066,732

IT equipment 144,210,842 113,566,062 30,644,780 116,082,771 96,146,431 19,936,340

Networking and communication equipment 8,080,915 6,017,168 2,063,747 4,606,980 3,998,113 608,867

Property, plant and equipment under finance lease (1) 15,605,427 11,597,248 4,008,179 18,011,208 10,968,706 7,042,502

Other property, plant and equipment 51,715,502 32,882,040 18,833,462 37,192,040 24,277,679 12,914,361

Total 320,541,591 187,194,462 133,347,129 248,531,733 153,098,611 95,433,122

(1) See note 16 Finance Lease.

b) The detail and movement of the year of the carrying amounts of property, plant and equipment as of December 31, 2016 and 2015 is as follows:

Land Biuldings

Constructions Vehicles Office

equipment IT Equipment

Networking and

communication equipment

Property, plant and

equipment under finance

lease

Other property, plant and

equipment Total

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Gross amount

Balance at 01.01.2016 5,812,391 52,387,169 2,832,292 723,372 10,883,510 116,082,771 4,606,980 18,011,208 37,192,040 248,531,733

Additions - 103,194 69,291 153,074 1,035,122 14,652,885 129,835 1,541,555 10,828,115 28,513,071

Acquisition through business combination 2,526,434 21,633,963 - 9,417 1,735,401 17,320,021 2,671,925 - 1,127,893 47,025,054

Effect of foreign currency exchange differences 248,290 1,288,956 (126,050) (15,677) 174,084 412,997 717,417 1,366,756 2,898,964 6,965,737

Increase (decrease) through transfers - - - - - 2,333,408 - 206,850 (80,765) 2,459,493

Increase (decrease) through other changes - - - - (85,946) 194,338 - - (17,048) 91,344

Disposals - - - (62,573) (396,809) (6,785,578) (45,242) (5,520,942) (233,697) (13,044,841)

Total movements 2,774,724 23,026,113 (56,759) 84,241 2,461,852 28,128,071 3,473,935 (2,405,781) 14,523,462 72,009,858

Total Assets (Gross amount) 8,587,115 75,413,282 2,775,533 807,613 13,345,362 144,210,842 8,080,915 15,605,427 51,715,502 320,541,591

Accumulated depreciation

Balance at 01.01.2016 - (8,845,927) (534,262) (510,715) (7,816,778) (96,146,431) (3,998,113) (10,968,706) (24,277,679) (153,098,611)

Depreciation expense - (1,819,979) (157,533) (94,187) (1,056,083) (11,102,432) (327,683) (4,273,185) (6,367,533) (25,198,615)

Acquisition through business combination - (2,103,246) - (4,403) (252,048) (7,159,865) (1,011,214) - - (10,530,776)

Effect of foreign currency exchange differences - (24,892) (5,062) 2,257 (178,694) (63,202) (693,036) (1,038,324) (2,300,809) (4,301,762)

Increase (decrease) through transfers - - - - - (2,540,195) - - 621 (2,539,574)

Increase (decrease) through other changes - - - - 74,566 36,302 - (4,118) (5,441) 101,309

Disposals - - - 57,665 137,377 3,409,761 12,878 4,687,085 68,801 8,373,567

Total movements - (3,948,117) (162,595) (38,668) (1,274,882) (17,419,631) (2,019,055) (628,542) (8,604,361) (34,095,851)

Total accumulated depreciation - (12,794,044) (696,857) (549,383) (9,091,660) (113,566,062) (6,017,168) (11,597,248) (32,882,040) (187,194,462)

Net balance at 12.31.2016 8,587,115 62,619,238 2,078,676 258,230 4,253,702 30,644,780 2,063,747 4,008,179 18,833,462 133,347,129


Land Biuldings Constructions Vehicles Office

equipment IT Equipment

Networking and

communication equipment

Property, plant and equipment under finance

lease

Other property, plant and equipment Total

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Gross amount

Balance at 01.01.2015 6,352,431 52,042,867 2,349,955 882,280 10,410,959 113,677,802 5,476,523 23,301,766 30,803,793 245,298,376

Additions - 2,947,238 92,700 31,602 834,448 13,780,318 261,471 1,333,183 8,752,657 28,033,617

Effect of foreign currency exchange differences (540,040) (2,547,856) 390,561 (23,064) (343,296) (6,174,101) (753,177) (3,950,826) (3,770,901) (17,712,700)

Increase (decrease) through transfers - (1,444) - - - (2,950) (289,902) 126,227 2,304,281 2,136,212

Increase (decrease) through other changes - (22,891) - 23,559 231,318 (447,436) - 65,303 (92,587) (242,734)

Disposals - (30,745) (924) (191,005) (249,919) (4,750,862) (87,935) (2,864,445) (805,203) (8,981,038)

Total movements (540,040) 344,302 482,337 (158,908) 472,551 2,404,969 (869,543) (5,290,558) 6,388,247 3,233,357

Total Assets (Gross amount) 5,812,391 52,387,169 2,832,292 723,372 10,883,510 116,082,771 4,606,980 18,011,208 37,192,040 248,531,733


Balance at 01.01.2015 - (7,144,090) (340,074) (550,495) (7,088,140) (92,662,053) (4,659,118) (12,063,146) (21,177,859) (145,684,975)

Depreciation expense - (1,892,398) (136,227) (99,041) (969,714) (11,124,813) (425,589) (3,849,485) (5,170,624) (23,667,891)

Effect of foreign currency exchange differences - 185,631 (57,961) 15,749 355,233 4,423,354 709,143 2,079,480 3,418,403 11,129,032

Increase (decrease) through transfers - - - - - 11,532 289,902 - (1,972,302) (1,670,868)

Increase (decrease) through other changes - (17,705) - (20,729) (212,181) 339,809 - - 112,125 201,319

Disposals - 22,635 - 143,801 98,024 2,865,740 87,549 2,864,445 512,578 6,594,772

Total movements - (1,701,837) (194,188) 39,780 (728,638) (3,484,378) 661,005 1,094,440 (3,099,820) (7,413,636)

Total accumulated depreciation - (8,845,927) (534,262) (510,715) (7,816,778) (96,146,431) (3,998,113) (10,968,706) (24,277,679) (153,098,611)

Net balance at 12.31.2015 5,812,391 43,541,242 2,298,030 212,657 3,066,732 19,936,340 608,867 7,042,502 12,914,361 95,433,122

Additional Information about Property, Plant and Equipment

a) Main Investments

A summary of the main assets included in property, plant and equipment is presented below: Land, buildings and construction: • SONDA S.A.: Datacenter located at 2211 Víctor Uribe Avenue, Quilicura • SONDA Inmobiliaria S.A.: Corporate building, offices and warehouses located at 540 and 574 Teatinos street, 1334 Santo Domingo Street, 4844 and 4848 Conquistador del Monte Street, 1423 and 1431 Camino de La Colina street and land plot where the Datacenter is located at 2211 Víctor Uribe Avenue, Quilicura, Santiago. • SONDA Argentina S.A.: Located at 772 Alsina Street, Buenos Aires, Argentina. • Microgeo S.A.: Located at 5154 Camino El Cerro Street, Huechuraba, Santiago. • Inmobiliaria Servibanca S.A.: Located at 1888 Catedral Street, Santiago. • Quintec Filiales Operativas S.A.: Located at 1140-1156 Santa Isabel Street, Providencia, Santiago. • SONDA de Colombia S.A.: Located at 45 Carrera Avenue (North Highway) 118 – 68, Bogotá, Colombia. • Sonda Procwork Informática. Ltda: - Corporate building located at 1206 Alameda Europa Street, Santana de Parnaiba, Sao Paulo. - 576 Dom Aguirre Street, Sao Paulo - ATIVAS Datacenter S.A.: located at Agenério Araújo Street, 20 – Camargos, Belo Horizonte – Minas Gerais.


IT Equipment

IT equipment mainly includes computer equipment and accessories; including Datacenter equipment for providing technological services.

Property, Plant and Equipment in financial leasing:

Corresponds to assets acquired by financial leasing which are purchased in installments, under a lease agreement. These assets do not legally belong to the Company, until the purchase option - which is stipulated in the contract - is exercised.

Other Property, Plant and Equipment

Within this classification the main component is software, which is used for the operation of equipment, and office furniture.

b) Depreciation Expenses

Depreciation expense recognized in cost of sales was ThCh$25,198,615 as of December 31, 2016 (ThCh$23,667,891 as of December 31, 2015).

c) Restrictions and Guarantees

As of December 31, 2016 and 2015, the Company has no restrictions on title or pledged its property, plant and equipment, except for those assets acquired under finance lease.

d) Impairment losses

The Company’s management has not identified indications of impairment on its property, plant and equipment.

15. INVESTMENT PROPERTY

The composition of investment property is as follows:

Classes of Investment Property 12.31.2016 12.31.2015

ThCh$ ThCh$ Investment Property, net 2,349,084 2,366,840

Land 2,005,515 2,005,515

Buildings 343,569 361,325

Investment Property, gross 2,606,503 2,606,503

Land 2,005,515 2,005,515

Buildings 600,988 600,988

Investment Property, accumulated depreciation 257,419 239,663

Buildings 257,419 239,663

Land Buildings Total

Investment Property net

ThCh$ ThCh$ ThCh$ Gross Amount

Balance at 01.01.2016 2,005,515 600,988 2,606,503

Additions from acquisitions - - -

Total movements - - -

Total Assets (Gross) 2,005,515 600,988 2,606,503

Accumulated depreciation and amortization

Balance at 01.01.2016 - (239,663) (239,663)

Depreciation expenses - (17,756) (17,756)

Total movements - (17,756) (17,756)

Total Accumulated depreciation - (257,419) (257,419)

Total increase (decrease) in Investment property - (17,756) (17,756)

Balance at 12.31.2016 2,005,515 343,569 2,349,084

Land Buildings Total

Investment Property net

ThCh$ ThCh$ ThCh$ Gross Amount

Balance at 01.01.2015 2,265,641 1,316,241 3,581,882

Disposals (260,126) (715,253) (975,379)

Total movements (260,126) (715,253) (975,379)

Total Assets (Gross) 2,005,515 600,988 2,606,503

Accumulated depreciation and amortization

Balance at 01.01.2015 - (289,911) (289,911)

Disposal (1) - 76,788 76,788

Depreciation expenses - (26,540) (26,540)

Total movements - 50,248 50,248

Total Accumulated depreciation - (239,663) (239,663)

Total increase (decrease) in Investment property (260,126) (665,005) (925,131)

Balance at 12.31.2015 2,005,515 361,325 2,366,840

The fair value of investment properties of ThCh$4,505,505 was obtained through internal valuations. These valuations were determined based on market evidence of the transaction prices for similar properties.

There has been no change in the valuation technique during the year.

(1) In September 2015, the subsidiary Sonda Inmobiliaria S.A., sold the property located at Av. Vitacura Nº 4705. The gain on sale was ThCh$1,364,410, which is presented in Other income (Note 27).


16. FINANCE LEASE

a) Disclosures about finance leases – the Company as lessee:

Classes of leased assets, net

12.31.2016 12.31.2015 Carrying amount


Carrying amount

Carrying amount


Carrying amount

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Property, plant and equipment

Land 210,203 - 210,203 206,770 - 206,770

IT Equipment 15,395,224 11,597,248 3,797,976 17,804,438 10,968,706 6,835,732

Investment Property 600,988 257,419 343,569 600,988 239,663 361,325

Total 16,206,415 11,854,667 4,351,748 18,612,196 11,208,369 7,403,827

The information about minimum future lease payments are as follows:

Minimum lease payments - Lessee

12.31.2016 12.31.2015

Minimum lease payments

Future finance charge on

leasing

Present value of minimum

lease payments Minimum lease

payments


leasing


lease payments ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Less than one year 4,430,710 812,704 3,618,006 4,727,790 225,439 4,502,351

Between one to five years 7,274,359 1,175,861 6,098,498 1,895,971 (3,474) 1,899,445

More than five years - - - - - -

Total 11,705,069 1,988,565 9,716,504 6,623,761 221,965 6,401,796

b) Disclosures about finance leases – the Company as lessor:

Minimum lease payments - Lessor

12.31.2016 12.31.2015

Minimum lease payments


leasing


lease payments Minimum lease

payments


leasing


lease payments ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Less than one year 19,103,562 2,471,473 16,632,089 17,306,436 1,677,068 15,629,368

Between one to five years 24,274,027 1,978,665 22,295,362 14,628,794 37,495 14,591,299

More than five years - - - - - -

Total 43,377,589 4,450,138 38,927,451 31,935,230 1,714,563 30,220,667

The minimum lease payments receivable result from lease contracts entered into with customers for rental of technology equipment, whose average term fluctuates between 12 and 48 months. The average interest rate is determined for each country.


17. DEFERRED TAXES AND INCOME TAX EXPENSES

a) Deferred taxes recognized as of December 31,2016 and 2015 resulting from temporary differences are as follows:

Temporary difference

Deferred tax assets12.31.2016 12.31.2015

ThCh$ ThCh$ ThCh$ ThCh$ Assets Liabilities Assets Liabilities

Depreciation 2,483,412 - 2,812,271 -

Amortization - 15,034,991 - 9,165,512

Provision 13,627,029 - 14,221,363 -

Tax Losses 25,443,434 - 13,342,093 -

Intangible assets - 200,720 - 314,845

Other - 89,376 - 938,899

Subtotal 41,553,875 15,325,087 30,375,727 10,419,256

Total deferred tax assets 26,228,788 - 19,956,471 -

Recovery of deferred tax assets will depend on whether sufficient taxable income are obtain in in the future. The Company, according to its projections, believes that these assets will be recovered.

Tax losses to be available to be utilized against future taxable profits generated in companies incorporated in Chile, Brazil and Colombia do not expire.

Temporary difference

Deferred tax liabilities 12.31.2016 12.31.2015

ThCh$ ThCh$ ThCh$ ThCh$ Assets Liabilities Assets Liabilities

Depreciation - 3,931,276 - 5,466,083

Amortization - 7,268,542 - 3,567,217

Provision 2,633,310 - 1,752,997 -

Revaluation of Property, Plant and equiptment - 6,038,961 - -

Tax Losses 2,093,046 - - -

Intangible assets - 4,518,810 - 4,442,191

Other - 2,716,015 - 1,528,004

Subtotal 4,726,356 24,473,604 1,752,997 15,003,495

Total deferred tax liabilities - 19,747,248 - 13,250,498

As indicated in Note 3.2 d), deferred tax assets and liabilities at each of the subsidiaries are offset, if they related to taxes levied by the same taxation authority, provided that the entity has a legally enforceable right to set off the current tax assets with current tax liabilities.


b) The movement of deferred taxes each year is as follows:

Deferred tax (Assets) Liabilities related to:

Balance at 01.01.2016

Deferred tax recognized in profit

or loss

Deferred tax recognized directly

in equity

Income tax recognized in other

comprehensive income

Increase (decrease) for business combination

Exchange difference on foreign

operations

Total increase (decrease) deferred

tax (assets) liabilities


M$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Depreciation 2,653,812 255,484 - - - (1,461,432) (1,205,948) 1,447,864

Amortization 12,732,729 6,423,573 - - - 3,147,231 9,570,804 22,303,533

Provision (15,974,360) 1,712,875 - (10,988) - (1,987,866) (285,979) (16,260,339)

Revaluation of Property, Plant and equiptment - - - - 6,038,961 - 6,038,961 6,038,961

Tax Losses (13,342,093) (5,571,896) - - (5,701,561) (2,920,930) (14,194,387) (27,536,480)

Intangible assets 4,757,036 (736,868) - - 30 699,332 (37,506) 4,719,530

Other 2,466,903 533,635 - 430,861 (399,204) (226,804) 338,488 2,805,391

Total (6,705,973) 2,616,803 - 419,873 (61,774) (2,750,469) 224,433 (6,481,540)

Deferred tax (Assets) Liabilities related to:


Deferred tax recognized in profit

or loss

Deferred tax recognized directly

in equity

Income tax recognized in other

comprehensive income

Increase (decrease) for business combination

Exchange difference on foreign

operations

Total increase (decrease) deferred

tax (assets) liabilities


ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Depreciation 1,792,413 1,002,957 - - - (141,558) 861,399 2,653,812

Amortization 12,701,946 3,172,685 - - - (3,141,902) 30,783 12,732,729

Provision (17,257,068) (1,455,316) 193,850 (9,605) - 2,553,779 1,282,708 (15,974,360)

Tax Losses (12,317,112) (3,372,843) - - - 2,347,862 (1,024,981) (13,342,093)

Intangible assets 7,755,244 (1,081,431) - - - (1,916,777) (2,998,208) 4,757,036

Other 946,306 416,199 - - - 1,104,398 1,520,597 2,466,903

Total (6,378,271) (1,317,749) 193,850 (9,605) - 805,802 (327,702) (6,705,973)

c) The details of deferred tax components of other comprehensive income are as follows:

Deferred tax in other comprehensive income

12.31.2016 12.31.2015

Carrying amount before tax Income tax

Carrying amount after tax

Carrying amount before tax Income tax

Carrying amount after tax

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Finacial Assets classified as held for sale 1,238,020 (430,861) 807,159 - - -

Profit (loss) for defined benefit obligation 19,611 10,988 30,599 (38,422) 9,605 (28,817)

Total 1,257,631 (419,873) 837,758 (38,422) 9,605 (28,817)

d) The income tax expense recognized in profit or loss is as follows:

Current tax (Profit/Loss) and adjustments in respect of prior years12.31.2016 12.31.2015

ThCh$ ThCh$

Income tax 10,731,132 36,872,095

Deferred tax 2,616,798 (1,317,749)

Total income tax expense recognized in the current year 13,347,930 35,554,346


e) Reconciliation between income taxes resulting from applying current tax rates in each country and consolidated tax expense:

Reconciliation between income taxes resulting from applying current tax rates in each country and consolidated tax expense

12.31.2016 12.31.2015

ThCh$ ThCh$

Profit before tax 45,275,298 83,099,078

Income tax expense calculated applying current tax in each country

10,924,134 20,974,072

Effect of income that is exempt from taxation (4,210,538) (17,317,940)

Effect of expenses that are not deductible in determining taxable profit

4,988,054 18,571,452

Effect of tax losses (62,171) 10,822

Other effects for reconciliation between accounting profit and tax expense (*)

1,708,451 13,315,940

Subtotal adjustments 2,423,796 14,580,274

Total Income tax expense recognised in profit or loss 13,347,930 35,554,346

(*) This includes the tax price-level restatement applied in Chile to investments in companies and equity.

The statutory tax rate corresponds to those established by current laws in each country to SONDA S.A. and its subsidiaries. The tax rates applicable to major companies in which Sonda has an interest are:

Country

Income tax rate

12.31.2016 12.31.2015

% %

Chile (i) 24.0% 22.5%

Argentina 35.0% 35.0%

Brazil 34.0% 34.0%

Mexico 30.0% 30.0%

Peru (ii) 28.0% 28.0%

Ecuador (iii) 25.0% 22.0%

Colombia 34.0% 34.0%

(i) Chilean Tax Reform

On September 29, 2014, Law 20.780, which introduced several amendments to the current income tax and other tax systems, was published in the Official Gazette.

Among the main changes, this law adds a new semi-integrated tax system, which can be used in an alternative way to the integrated system of attributed income. Taxpayers may freely choose either system to pay their taxes. In the case of SONDA, generally established by law, the semi-integrated tax system is applied, without ruling out that a future Board of Shareholders opts for the attributed income system.

The established tax rates are: 21% for the year 2014, 22.5% for the years 2015, 24% by 2016, 25% by 2017, and 27% by 2018 and following years.

On January 27, 2016, the Tax Simplification Bill was approved, which aims to simplify the income tax system that will begin to run from 2017; to make adjustments to the value added tax; as well as circumvention standards. Regarding the taxation system, the proposed amendment considers that corporations (listed or not listed), as in the case of SONDA, should always be taxed according to the modality of the Semi Integrated System. Then, this system will be the tax regime for companies starting in the 2017 year.

(ii) Modification to the Income Tax Law in Peru

On December 31, 2014, was enacted the Law that promotes the recovery of the economy, including a modification of the Single Ordered Text (Texto Unico Ordenado) of the Law on Income Taxes of Peru.

Among other things, the Law amends the tax payable to those who receive third category taxes domiciled in the country on their net income, with rates of 28% for the years 2015 and 2016, 27% for the years 2017 and 2018, and 26 % for the years 2019 onwards.

(iii) Sonda Ecuador – a change in the tax system as per resolution issued by the SERVICIO DE RENTAS INTERNAS (SRI) or local IRS:

• Companies are obliged to report an Annex of Shareholders, Unitholders, Partners, Board Members and Administrators until they reach the individual who is the actual beneficiary of the share.

• The information to be reported covers 100% of the holders or beneficiaries of rights representative of capital, board members and administrators.

• In the case of share capital rights quoted on a stock exchange, the obligation is to report at least 80% of the corporate composition of the entity obliged to report, and of such owners or beneficiaries.

• When the annex is not filed, the 25% income tax rate must be applied.• When reporting incompletely, the 25% income tax rate must be applied to the portion of the taxable

base that corresponds to the unreported share-holding. The 25% rate will apply to the entire taxable base in cases where 50% or more of the corporate composition is not reported. It will be understood that the information reported is incomplete when the SRI (local IRS) cannot identify the holders or beneficiaries of rights representing capital, their residence and their ownership in the corporate composition.

18. OTHER NON-FINANCIAL ASSETS

a) The details of other non-financial assets are as follows:

Current Non-current

12.31.2016 12.31.2015 12.31.2016 12.31.2015

ThCh$ ThCh$ ThCh$ ThCh$

Installation and development projects 2,429,774 2,093,602 2,043,834 2,139,920

Securities pledged as collateral (2) 26,632 25,978 4,332,817 3,951,527

Advace payments (1) 6,443,927 5,128,437 264,142 582,159

Other refundable taxes (4) 691,980 1,591,729 7,414,377 2,294

Guarantees (3) 3,454,005 4,741,905 1,415,816 1,067,215

Maintainance and support equipment 411,872 - 723,910 740,632

Third party account receivables (5) - - 1,158,897 -

Other 1,726,187 730,630 450,441 166,600

Total 15,184,377 14,312,281 17,804,234 8,650,347

(1) Corresponds mainly to advance payments to suppliers.

(2) It corresponds primarily to deposits and guarantees required for the performance of services, which will be refunded once the service is completed.

(3) These correspond to costs for maintenance and support of equipment, whose payment is anticipated and is accrued within the execution term of the service.

(4) As of December 31, 2016, under non-current assets there is the amount of ThCh $ 7,385,906, which originates from the subsidiary PARS, which was part of a lawsuit filed by its former controlling shareholder, against the Brazilian Federal Revenue Service (Local IRS) in order to obtain the recognition of a credit for the refund of IRRF taxes (Income Tax Withheld at source) arising from the importation of software products. At the end of the judicial process in 2014, PARS obtained a favorable decision (“tránsito em julgado”) regarding the validity of the tax credit and therefore the possibility of using it to pay federal taxes associated with income (income tax and corporate contribution on Net profit) and with billing (PIS - Cofins).

This court decision meant that the former controlling shareholders of PARS demanded the payment of a price adjustment that resulted in arbitration between the parties that ultimately ruled that PARS must pay those shareholders the amount they demanded. After both parties filed "clarification motions", the ruling is currently final and binding.

As a result of the above, the Company has initiated administrative proceedings in order that the local Brazilian tax authorities recognize this tax credit and its use by PARS.

Once this decision was obtained from the arbitration court between SONDA, PARS and the former owner of PARS (in July 2016), which ratified PARS’s right to use the aforementioned IRRF credits, the management decided to carry out the process of homologation of these credits . Consistently with this, and once all the documentation was reviewed and the independent advisors report was obtained regarding the validity of these credits, on September 23, 2016, PARS filed an application for approval of these credits with the local IRS, in order to be able to use these credits to offset its taxes.

This credit can be used against taxes associated with income (income tax and corporate contribution on net income) and against billing (PIS - Cofins); its recovery is estimated in a maximum of 4 years. The statute of limitations for the use of tax credits in Brazil in general expires after 5 years as from their homologation, and although it is estimated that this credit will be recovered in a shorter term, tax advisers believe that this statute of limitation does not apply in this particular case.


The effect of the above on the accounting records was that the Company recorded an asset in the amount of R $ 51.5 million (local currency) relating to the credit to be recovered. The effect of this on profit and loss is presented net of the obligation amounting to R $ 66.9 million paid to the former controlling shareholder, since these credits were generated prior to the acquisition by Sonda S.A. in accordance with the provisions of the PARS purchase agreement. This difference between the amount paid and the credit is mainly generated by the indexation of these amounts and was charged to income under "Other expenses by function" (Note 29). As of December 31, 2016, the obligation has been completely paid.

The net after tax effect was a charge of R $ 10.2 million, recorded in September 2016.

(5) The purchase of ATIVAS DATACENTER S.A. in October 2016 (as reported in Note 3.2.a to 9), included financing by means of a loan to non-controlling shareholders, for their respective capital contributions. This financing is guaranteed by the aforementioned shares (a 40% interest in ATIVAS) as well as by any cash flow received by non-controlling shareholders such as, for example, dividends.

This loan generates interest in the amount of 110% of CDI (Interbank CD) with a limit of 12% per annum plus inflation. At December 31, 2016 this value amounted to ThCh $16,204,545.

The due date of this loan will occur on the date of exercise of the PUT or CALL options, which can be exercised as from the year 2021. SONDA will offset the balance of this loan in its favor, with the price of the exercised option.

The balance receivable of the previously mentioned loan is shown net of the existing present obligation with the non-controlling shareholders of ATIVAS which is generated upon valuation of the PUT option which said shareholders have, for the shares representing 40% of ATIVAS´ capital.

The information considered in order to value the PUT options is as follows:

• Original amount of the obligation: Based upon a multiple of the net profit projected up to the year 2020 multiplied by 40%. • Date of the exercise of the PUT option, as from Jan. 1, 2021. • Real discount rate, equivalent to the average financing cost of the Company: 11,3%Value of liabilities at present value: R$73.1 million. At December 31, 2016 this value amounted to ThCh$15,045,648.

19. OTHER FINANCIAL LIABILITIES

The details of other financial liabilities are as follows:

12.31.2016 12.31.2015

ThCh$ ThCh$

Other non-current financial liabilities

Non-current bank loans (1) (2) 513,766 1,549,930

Non-current bond liabilities (4) 76,042,582 75,150,906

Non-current lease liabilities (3) 6,098,498 1,899,445

Other non-current financial liabilities 12,663 41,042

Total other non-current financial liabilities 82,667,509 78,641,323

Other current financial liabilities

Current bank loan (1) (2) 77,049,846 8,222,616

Current bond liabilities (4) 465,586 459,099

Current lease liabilities (3) 3,618,006 4,502,351

Other current financial liabilities 2,136,857 123,799

Total other current financial liabilities 83,270,295 13,307,865

Other financial liabilities

Bank Loans (1) (2) 77,563,612 9,772,546

Bond liabilities (4) 76,508,168 75,610,005

Lease liabilities (3) 9,716,504 6,401,796

Other financial liabilities 2,149,520 164,841

Total other financial liabilities 165,937,804 91,949,188

(1) The following table sets forth bank loans (current and non-current) as of December 31, 2016 and 2015:

12.31.2016 12.31.2015 ThCh$ ThCh$

Bank loans

Non-current bank loans 513,766 1,549,930

Current and current portion of non-current interest- bank loans

Current bank loans 76,012,158 6,571,111

Current portion of non-current bank loans 1,037,688 1,651,505

Total current and non-current bank loans 77,049,846 8,222,616

Total bank loans 77,563,612 9,772,546


(2) Details of Bank Loans is as follows:

Loan number

Tax number debtor company

Debtor nameDebtor company´s country

Bank or financial institution Indexation Currency

Type of Amortization

Rates

12.31.2016

Placed nominal value

Effective Nominal Up to 90

days More than

90 days

More than 1 up to 3 years




More than 5 years Total

1-22 Foreign Ativas Data Center S.A. Brasil Banco de Desenvolvimento de Minas Gerais S.A. Brazilian real Monthly 0.05 0.05 1,778 4,149 - - - - - 5,927

2-22 Foreign Ativas Data Center S.A. Brasil Banco de Desenvolvimento de Minas Gerais S.A. Brazilian real Monthly 0.05 0.05 16,218 47,906 64,872 64,872 54,808 - - 248,676

3-22 Foreign CTIS Tegnologia S.A. Brasil Banco de Desenvolvimento de Minas Gerais S.A. Brazilian real Monthly 18.02 18.02 176,286 335,920 - - - - - 512,206

4-22 Foreign CTIS Tegnologia S.A. Brasil Banco de Desenvolvimento de Minas Gerais S.A. Brazilian real Monthly 14.00 14.00 71,250 - - - - - - 71,250

5-22 Foreign Sonda Procwork Ltda. Brasil Safra Brazilian real Monthly 13.00 13.00 15,168 - - - - - - 15,168

6-22 Foreign Sonda Procwork Ltda. Brasil Banco Santander Brazilian real Monthly 16.25 16.25 6,351,929 - - - - - - 6,351,929

7-22 Foreign Sonda Procwork Ltda. Brasil Banco Itaú Brazilian real Monthly 4.00 8.00 126,285 370,366 329,214 - - - - 825,865

8-22 Foreign Sonda do Brasil Brasil Banco Santander Brazilian real Monthly 3.20 3.20 - 15,168 - - - - - 15,168

9-22 Foreign Sonda do Brasil Brasil Financiadora de Estudios y Proyectos FINEP Brazilian real Monthly 3.20 3.20 2,049,502 - - - - - - 2,049,502

10-22 Foreign Sonda Procwork Outsourcing Ltda Brasil Banco Itaú Brazilian real Maturity 13.73 13.73 - 23,893,333 - - - - - 23,893,333

11-22 Foreign Sonda Procwork Outsourcing Ltda Brasil Banco Santander Brazilian real Maturity 13.73 13.73 - 16,426,093 - - - - - 16,426,093

12-22 Foreign Telsinc Com De Equi Informatico Brasil Banco Santander Brazilian real Monthly 1.00 1.00 1,014,197 - - - - - - 1,014,197

13-22 88.579.800-4 Microgeo S.A. Chile Banco Santander US Dolar Monthly 4.92 4.92 459,978 - - - - - - 459,978

14-22 96.967.100-K Novis S.A. Chile Banco Santander Chilean peso Monthly 1.00 1.00 38,751 - - - - - - 38,751

15-22 83.628.100-4 Sonda S.A. Chile Banco Credito e Inversiones Chilean peso Monthly 5.16 4.37 168,504 24,611,184 - - - - - 24,779,688

16-22 Foreign Sonda de Colombia S.A. Colombia Banco Credito e Inversiones Colombian pesos Monthly 11.16 10.44 - 178,571 - - - - - 178,571

17-22 Foreign Sonda de Colombia S.A Colombia Banco de Chile Colombian pesos Quarterly 11.27 10.54 - 178,655 - - - - - 178,655

18-22 Foreign Sonda de Colombia S.A Colombia Banco Corpbanca Colombian pesos At maturity 10.95 10.26 - 231,736 - - - - - 231,736

19-22 Foreign Sonda de Colombia S.A Colombia Banco Corpbanca Colombian pesos Monthly 10.95 10.26 - 185,388 - - - - - 185,388


21-22 Foreign Sonda de Colombia S.A Colombia Banco Corpbanca Colombian pesos Quarterly 10.95 10.26 - 170,868 - - - - - 170,868

22-22 Foreign Novis México México Banco Corpbanca US Dolar Monthly 0.04 0.04 - 343,587 - - - - - 343,587

Total 10,489,846 67,410,048 394,086 64,872 54,808 - - 78,413,660


Loan number



Bank or financial institution Indexation Currency Type of

Amortization

Rates

12.31.2016

Carrying amount


days More than

90 days






1-22 Foreign Ativas Data Center S.A. Brasil Banco de Desenvolvimento de Minas Gerais S.A.

Brazilian real Monthly 0.05 0.05 1,778 4,149 - - - - - 5,927

2-22 Foreign Ativas Data Center S.A. Brasil Banco de Desenvolvimento de Minas Gerais S.A.

Brazilian real Monthly 0.05 0.05 16,218 47,906 64,872 64,872 54,808 - - 248,676

3-22 Foreign CTIS Tegnologia S.A. Brasil Banco de Desenvolvimento de Minas Gerais S.A.

Brazilian real Monthly 18.02 18.02 154,534 316,452 - - - - - 470,986

4-22 Foreign CTIS Tegnologia S.A. Brasil Banco de Desenvolvimento de Minas Gerais S.A.

Brazilian real Monthly 14.00 14.00 71,250 - - - - - - 71,250

5-22 Foreign Sonda Procwork Ltda. Brasil Safra Brazilian real Monthly 13.00 13.00 15,168 - - - - - - 15,168

6-22 Foreign Sonda Procwork Ltda. Brasil Banco Santander Brazilian real Monthly 16.25 16.25 6,351,929 - - - - - - 6,351,929

7-22 Foreign Sonda Procwork Ltda. Brasil Banco Itaú Brazilian real Monthly 4.00 8.00 126,285 370,366 329,214 - - - - 825,865

8-22 Foreign Sonda do Brasil Brasil Banco Santander Brazilian real Monthly 3.20 3.20 - 15,168 - - - - - 15,168

9-22 Foreign Sonda do Brasil Brasil Financiadora de Estudios y Proyectos FINEP

Brazilian real Monthly 3.20 3.20 2,049,502 - - - - - - 2,049,502

10-22 Foreign Sonda Procwork Outsourcing Ltda

Brasil Banco Itaú Brazilian real Maturity 13.73 13.73 - 23,893,333 - - - - - 23,893,333

11-22 Foreign Sonda Procwork Outsourcing Ltda

Brasil Banco Santander Brazilian real Maturity 13.73 13.73 - 16,426,093 - - - - - 16,426,093

12-22 Foreign Telsinc Com De Equi Informatico Brasil Banco Santander Brazilian real Monthly 1.00 1.00 1,014,197 - - - - - - 1,014,197

13-22 88.579.800-4 Microgeo S.A. Chile Banco Santander US Dolar Monthly 4.92 4.92 459,978 - - - - - - 459,978

14-22 96.967.100-K Novis S.A. Chile Banco Santander Chilean peso Monthly 1.00 1.00 38,751 - - - - - - 38,751

15-22 83.628.100-4 Sonda S.A. Chile Banco Credito e Inversiones Chilean peso Monthly 5.16 4.37 - 24,051,408 - - - - - 24,051,408

16-22 Foreign Sonda de Colombia S.A. Colombia Banco Credito e Inversiones Colombian pesos Monthly 11.16 10.44 - 166,412 - - - - - 166,412

17-22 Foreign Sonda de Colombia S.A Colombia Banco de Chile Colombian pesos Quarterly 11.27 10.54 - 165,147 - - - - - 165,147

18-22 Foreign Sonda de Colombia S.A Colombia Banco Corpbanca Colombian pesos At maturity 10.95 10.26 - 221,402 - - - - - 221,402



21-22 Foreign Sonda de Colombia S.A Colombia Banco Corpbanca Colombian pesos Quarterly 10.95 10.26 - 154,133 - - - - - 154,133

22-22 Foreign Novis México México Banco Corpbanca US Dolar Monthly 0.04 0.04 - 343,587 - - - - - 343,587

Total 10,299,590 66,750,256 394,086 64,872 54,808 - - 77,563,612

Loan number



Bank or financial institution Indexation Currency Type of Amortization

Rates

12.31.2015



days More than

90 days






1-20 Foreign CTIS Tecnología S.A. Brasil Safra Brazilian real Monthly 18.02 18.02 174,207 486,292 442,532 - - - - 1,103,031

2-20 Foreign CTIS Tecnología S.A. Brasil Daycoval Brazilian real Monthly 18.16 18.16 97,123 262,068 - - - - - 359,191

3-30 Foreign CTIS Tecnología S.A. Brasil Santander Brazilian real Monthly 16.25 16.25 4,599,275 - - - - - - 4,599,275

4-20 Foreign Sonda Procwork Ltda. Brasil Financiadora de estudios y proyectos FINEP


5-20 Foreign Sonda Procwork Ltda. Brasil Banco Itau Brazilian real Monthly 13.00 13.00 5,608 - 29,056 - - - - 34,664

6-20 Foreign Sonda Procwork Ltda. Brasil Banco Santander Brazilian real Monthly 19.20 19.20 5,770 - - - - - - 5,770

7-20 Foreign Sonda Procwork Ltda. Brasil Banco Itau - Garantia Brazilian real Monthly 18.73 18.73 1,009 - - - - - - 1,009


Brazilian real Monthly 4.00 8.00 75,154 356,514 713,028 - - - - 1,144,696

9-20 88.579.800-4 Microgeo S.A Chile Banco Credito e Inversiones US Dolar Monthly 1.66 1.66 512,704 - - - - - - 512,704

10-20 Foreign Novis Mexico Mexico Banco Itau US Dolar Monthly 1.04 1.04 397,636 - 364,499 - - - - 762,135

11-20 96.967.100-K Novis S.A. Chile Banco Credito e Inversiones Chilean pesos Monthly 1.00 1.00 20,935 - - - - - - 20,935

12-20 Foreign Sonda Argentina Argentina HSBC Argentinian pesos Monthly 30.00 30.00 - 209,626 - - - - - 209,626

13-20 Foreign Sonda de Brasil Brasil Banco Itau Brazilian real Monthly 3.20 3.20 - 5,608 29,056 - - - - 34,664

14-20 Foreign Sonda de Colombia S.A Colombia Banco de Bogota Colombian pesos Quarterly 6.47 6.22 - 18,127 - - - - - 18,127


16-20 Foreign Sonda de Colombia S.A Colombia Banco de Bogota Colombian pesos At maturity 8.94 8.47 - 114,810 - - - - - 114,810




20-20 Foreign Quintec Colombia SAS Colombia Bancolombia Colombian pesos Quarterly 8.33 7.92 - 323,871 - - - - - 323,871

Total 5,990,855 2,550,792 1,578,171 - - - - 10,119,818


Loan number




Type of Amortization

Rates

12.31.2015

Carrying amount


days

More than 90

days

More than 1 up to 3

years





1-20 Foreign CTIS Tecnología S.A. Brasil Safra Brazilian real Monthly 18.02 18.02 133,879 401,637 414,289 - - - - 949,805

2-20 Foreign CTIS Tecnología S.A. Brasil Daycoval Brazilian real Monthly 18.16 18.16 69,515 205,954 - - - - - 275,469

3-30 Foreign CTIS Tecnología S.A. Brasil Santander Brazilian real Monthly 16.25 16.25 4,534,323 - - - - - - 4,534,323



5-20 Foreign Sonda Procwork Ltda. Brasil Banco Itau Brazilian real Monthly 13.00 13.00 5,608 - 29,056 - - - - 34,664

6-20 Foreign Sonda Procwork Ltda. Brasil Banco Santander Brazilian real Monthly 19.20 19.20 5,770 - - - - - - 5,770

7-20 Foreign Sonda Procwork Ltda. Brasil Banco Itau - Garantia Brazilian real Monthly 18.73 18.73 1,009 - - - - - - 1,009


Brazilian real Monthly 4.00 8.00 75,154 356,514 713,028 - - - - 1,144,696

9-20 88.579.800-4 Microgeo S.A Chile Banco Credito e Inversiones US Dolar Monthly 1.66 1.66 512,704 - - - - - - 512,704

10-20 Foreign Novis Mexico Mexico Banco Itau US Dolar Monthly 1.04 1.04 397,636 - 364,499 - - - - 762,135

11-20 96.967.100-K Novis S.A. Chile Banco Credito e Inversiones Chilean pesos Monthly 1.00 1.00 20,935 - - - - - - 20,935

12-20 Foreign Sonda Argentina Argentina HSBC Argentinian pesos Monthly 30.00 30.00 209,626 - - - - - - 209,626

13-20 Foreign Sonda de Brasil Brasil Banco Itau Brazilian real Monthly 3.20 3.20 - 5,608 29,058 - - - - 34,666



16-20 Foreign Sonda de Colombia S.A Colombia Banco de Bogota Colombian pesos At maturity 8.94 8.47 - 110,000 - - - - - 110,000




20-20 Foreign Quintec Colombia SAS Colombia Bancolombia Colombian pesos Quarterly 8.33 7.92 - 319,447 - - - - - 319,447

Total 6,067,593 2,155,023 1,549,930 - - - - 9,772,546

(3) Details of Lease liabilities

Loan number




Type of Amortisation

Rates

12.31.2016



days

More than 90

days






1-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.16 0.16 1,125 3,367 9,605 6,200 - - - 20,297




5-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.16 0.16 978 2,927 7,956 6,468 539 - - 18,868


7-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.16 0.16 774 2,316 6,294 5,117 1,279 - - 15,780

8-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.16 0.16 259 774 2,389 1,710 428 - - 5,560

9-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.28 0.28 1,332 3,983 11,560 8,802 2,934 - - 28,611





14-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.17 0.17 257 769 1,950 1,700 1,700 142 - 6,518

15-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.17 0.17 2,291 6,846 19,867 15,128 15,128 2,521 - 61,781




19-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.17 0.17 1,467 4,384 13,531 9,688 9,688 807 - 39,565






25-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.14 0.14 48,841 145,934 423,536 322,494 322,494 80,624 - 1,343,923


27-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.16 0.16 506 1,511 4,386 3,340 3,340 1,113 - 14,196


Loan number





Rates

12.31.2016



days

More than 90

days






28-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.17 0.17 90 270 784 597 597 249 - 2,587





33-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.18 0.18 137 410 1,267 907 907 454 - 4,082






39-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.17 0.17 272 812 7,888 - - - - 8,972

40-114 Foreign Ativas Data Center S.A Brazil Hitachi Data Systems Computadores do Brasil LTDA. Brazilian reais Monthly 0.05 0.05 3,805 11,399 20,488 - - - - 35,692

41-114 Foreign Ativas Data Center S.A Brazil CA Programas de Computador, Participações e Serviços Ltda. Brazilian reais Monthly 0.05 0.05 50,861 - 33,428 - - - - 84,289

42-114 Foreign Ativas Data Center S.A Brazil CA Programas de Computador, Participações e Serviços Ltda. Brazilian reais Monthly 0.05 0.05 28,900 77,016 21,750 - - - - 127,666

43-114 Foreign Ativas Data Center S.A Brazil CA Programas de Computador, Participações e Serviços Ltda. Brazilian reais Monthly 0.05 0.05 8,661 25,918 113,404 - - - - 147,983

44-114 Foreign CTIS Tecnologia S.A. Brazil Procomp Industria Eletronica LTDA Brazilian reais Monthly 5.00 5.00 949,547 - - - - - - 949,547

45-114 Foreign Sonda Procwork Ltda. Brazil Banco Santander Brazilian reais Monthly 17.28 17.28 128,990 375,539 338,004 102,300 13,398 - - 958,231

46-114 Foreign Sonda Procwork Ltda. Brazil Banco Itau Brazilian reais Monthly 16.77 16.77 6,725 11,291 - - - - - 18,016

47-114 Foreign Sonda Brasil Brazil Banco Itau Brazilian reais Monthly 17.68 17.68 12,449 - - - - - - 12,449

48-114 88.579.800-4 Microgeo S.A Chile Banco Credito e inversiones UF Monthly 4.92 4.92 2,400 - - - - - - 2,400

49-114 96.967.100-K Novis S.A Chile Banco Chile UF Monthly 4.00 4.00 11,265 33,796 86,368 - - - - 131,429





54-114 96.967.100-K Novis S.A Chile Banco Credito e inversiones UF Monthly 4.00 4.00 22,960 68,880 7,653 - - - - 99,493

55-114 96.967.100-K Novis S.A Chile Banco Credito e inversiones UF Monthly 4.00 4.00 16,218 21,624 - - - - - 37,842




59-114 96.967.100-K Novis S.A Chile Banco Itau UF Monthly 4.00 4.00 8,726 26,177 5,817 - - - - 40,720





64-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 3,277 - - - - - - 3,277

65-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 531 - - - - - - 531

66-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 1,144 1,144 - - - - - 2,288


68-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 778 259 - - - - - 1,037



71-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 410 274 - - - - - 684






77-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 958 1,596 - - - - - 2,554









Loan number





Rates

12.31.2016



days

More than 90

days







86-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 549 1,652 184 - - - - 2,385


88-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 2,239 6,718 8,957 3,732 - - - 21,646



91-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 1,039 3,116 2,424 - - - - 6,579





96-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 770 2,311 2,824 - - - - 5,905

97-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 685 2,056 2,741 2,513 - - - 7,995


99-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 1,386 4,181 5,575 465 - - - 11,607



102-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 2,139 6,574 8,766 8,766 8,766 5,113 - 40,124

103-114 Foreign Sonda de Colombia S.A Colombia Bancolombia Colombian pesos Monthly 4.42 3.97 723 2,181 2,908 1,939 - - - 7,751

104-114 Foreign Sonda de Colombia S.A Colombia Bancolombia Colombian pesos Monthly 4.42 3.97 835 2,521 560 - - - - 3,916

105-114 Foreign Sonda de Colombia S.A Colombia Bancolombia Colombian pesos Monthly 4.42 3.97 528 1,585 1,057 - - - - 3,170

106-114 Foreign Sonda de Colombia S.A Colombia IBM Colombia Colombian pesos Monthly 4.42 3.97 16,885 4,132 - - - - - 21,017






112-114 Foreign Sonda de Colombia S.A Colombia IBM Colombia Colombian pesos Monthly 4.42 3.97 6,974 15,357 20,476 20,476 10,239 - - 73,522

113-114 Foreign Sonda Peru Peru Hewlett Packard Peru S.R.L. US Dollar Monthly 0.05 0.05 - 69,101 69,103 69,100 - - - 207,304

114-114 Foreign Sonda Peru Peru CSI Renting Peru S.A.C. US Dollar Monthly 0.05 0.05 - 99,714 - - - - - 99,714

Total 1,677,064 1,975,710 3,293,312 1,621,087 1,003,271 204,898 - 9,775,342

Loan number



Bank or financial institution Indexation Currency Type of Amortisation

Rates

12.31.2016

Carrying amount


days

More than 90

days





More than

5 years Total








8-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.16 0.16 259 774 11,843 1,710 428 - - 15,014






14-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.17 0.17 257 769 11,404 1,700 1,700 142 - 15,972





19-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.17 0.17 1,467 4,384 22,985 9,688 9,688 807 - 49,019






Loan number




Rates

12.31.2016

Carrying amount


days

More than 90

days





More than

5 years Total


25-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.14 0.14 48,841 145,934 423,536 322,494 322,494 80,624 - 1,343,923



28-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.17 0.17 90 270 784 597 597 249 - 2,587





33-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.18 0.18 137 410 1,267 907 907 454 - 4,082






39-114 Foreign Ativas Data Center S.A Brazil HP Financial Services Brazilian reais Monthly 0.17 0.17 272 812 7,888 - - - - 8,972

40-114 Foreign Ativas Data Center S.A Brazil Hitachi Data Systems Computadores do Brasil LTDA.

Brazilian reais Monthly 0.05 0.05 3,805 11,399 - - - - - 15,204

41-114 Foreign Ativas Data Center S.A Brazil CA Programas de Computador, Participações e Serviços Ltda.

Brazilian reais Monthly 0.05 0.05 50,861 - - - - - - 50,861





44-114 Foreign CTIS Tecnologia S.A. Brazil Procomp Industria Eletronica LTDA


45-114 Foreign Sonda Procwork Ltda. Brazil Banco Santander Brazilian reais Monthly 17.28 17.28 128,990 375,539 338,004 102,300 13,398 - - 958,231

46-114 Foreign Sonda Procwork Ltda. Brazil Banco Itau Brazilian reais Monthly 16.77 16.77 6,725 11,291 - - - - - 18,016

47-114 Foreign Sonda Brasil Brazil Banco Itau Brazilian reais Monthly 17.68 17.68 12,449 - - - - - - 12,449

48-114 88.579.800-4 Microgeo S.A Chile Banco Credito e inversiones UF Monthly 4.92 4.92 2,400 - - - - - - 2,400







55-114 96.967.100-K Novis S.A Chile Banco Credito e inversiones UF Monthly 4.00 4.00 16,070 21,427 - - - - - 37,497









64-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 3,277 - - - - - - 3,277







71-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 410 274 - - - - - 684









Loan number




Rates

12.31.2016

Carrying amount


days

More than 90

days





More than

5 years Total


















96-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 770 2,311 2,824 - - - - 5,905

97-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 685 2,056 2,741 2,513 - - - 7,995


99-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 1,386 4,181 5,574 465 - - - 11,606



102-114 Foreign Sonda de Colombia S.A Colombia Banco Occidente Colombian pesos Monthly 4.42 3.97 2,139 6,574 8,766 8,766 8,766 5,113 - 40,124

103-114 Foreign Sonda de Colombia S.A Colombia Bancolombia Colombian pesos Monthly 4.42 3.97 723 2,181 2,907 1,939 - - - 7,750

104-114 Foreign Sonda de Colombia S.A Colombia Bancolombia Colombian pesos Monthly 4.42 3.97 835 2,521 560 - - - - 3,916

105-114 Foreign Sonda de Colombia S.A Colombia Bancolombia Colombian pesos Monthly 4.42 3.97 528 1,585 1,056 - - - - 3,169







112-114 Foreign Sonda de Colombia S.A Colombia IBM Colombia Colombian pesos Monthly 4.42 3.97 6,973 15,357 20,477 20,476 10,239 - - 73,522


114-114 Foreign Sonda Peru Peru CSI Renting Peru S.A.C. US Dollar Monthly 0.05 0.05 - 99,714 - - - - - 99,714

Total 1,670,616 1,947,390 3,273,045 1,617,284 1,003,271 204,898 - 9,716,504

Loan number





Rates

12.31.2015



days

More than 90

days






1-81 Foreign CTIS Tecnologia S.A Brazil PROCOMP Industria Electronica LTDA



Brazilian reais Monthly 5.00 5.00 674,043 2,039,717 - - - - - 2,713,760

3-81 Foreign Sonda Procwork Informatica LTDA.

Brazil Banco Itauleasing S.A Brazilian reais Monthly 16.70 16.70 3,372 10,224 - - - - - 13,596


Brazil Banco Santander Brazilian reais Monthly 16.69 16.69 65,467 177,491 202,970 10,677 - - - 456,605


Brazil Banco Itaucard S.A Brazilian reais Monthly 16.78 16.78 7,018 17,330 15,607 - - - - 39,955

6-81 88.579.800-4 Microgeo Chile Banco de Credito e Inversiones UF Monthly 4.92 4.92 6,459 19,950 2,952 - - - - 29,361

7-81 96.967.100-K Novis S.A. Chile Banco de Chile UF Monthly 4.00 4.00 10,957 32,873 127,843 - - - - 171,673



10-81 96.967.100-K Novis S.A. Chile Banco de Credito e Inversiones UF Monthly 4.00 4.00 22,333 67,000 96,778 - - - - 186,111



Loan number





Rates

12.31.2015



days

More than 90

days








14-81 96.967.100-K Novis S.A. Chile Banco Itau UF Monthly 4.00 4.00 8,487 25,462 39,608 - - - - 73,557




18-81 Foreign Sonda Brasil Brasil Banco Itaucard S.A Brazilian reais Monthly 17.68 17.68 15,876 48,144 6,118 - - - - 70,138

19-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 10.96 10.54 8,018 25,157 17,741 - - - - 50,916


21-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 1.23 1.22 467 - - - - - - 467

22-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 2.75 2.72 17,756 17,871 - - - - - 35,627

23-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 0.72 0.72 1,973 658 - - - - - 2,631


25-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 1.93 1.92 625 418 - - - - - 1,043

26-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 4.05 3.99 597 401 - - - - - 998





31-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 1.62 1.63 790 2,372 263 - - - - 3,425

32-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 3.67 3.62 480 1,301 - - - - - 1,781


34-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 2.53 2.51 778 2,334 1,037 - - - - 4,149


















52-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 3.32 3.36 524 1,586 2,146 180 - - - 4,436


54-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 1.33 1.32 1,762 5,459 7,701 8,212 3,580 - - 26,714



57-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 0.04 0.04 994 2,991 4,006 2,346 - - - 10,337


59-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 0.04 0.04 1,738 5,241 7,048 5,331 - - - 19,358




63-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 0.02 0.02 503 1,567 2,226 2,393 2,351 - - 9,040


65-81 Foreign Sonda de Colombia Colombia Bancolombia Colombian pesos Monthly 0.02 0.02 806 1,722 2,427 1,705 - - - 6,660

66-81 Foreign Sonda de Colombia Colombia Bancolombia Colombian pesos Monthly 0.35 0.35 740 2,276 3,183 547 - - - 6,746


68-81 Foreign Sonda de Colombia Colombia IBM Colombian pesos Monthly 3.55 3.50 16,755 36,401 16,430 - - - - 69,586



Loan number





Rates

12.31.2015



days

More than 90

days








72-81 Foreign Quintec Colombia Colombia Banco Occidente Colombian pesos Monthly 1.65 1.64 465 1,443 1,518 - - - - 3,426


74-81 Foreign Quintec Colombia Colombia IBM Colombian pesos Monthly 3.55 3.50 7,705 5,181 - - - - - 12,886

75-81 Foreign Quintec Colombia Colombia IBM Colombian pesos Monthly 3.55 3.50 3,665 11,432 6,644 - - - - 21,741





80-81 Foreign Sonda Peru Peru CSI Renting Peru S.A.C. US Dollar Monthly 5.65 5.65 - 73,137 109,747 109,702 - - - 292,586

81-81 Foreign Telsinc Servicios Brasil Santander leasing S.A Brazilian reais Monthly 17.68 17.68 3,222 4,709 - - - - - 7,931

Total 1,376,958 3,324,219 1,492,571 363,068 32,829 - - 6,589,645

Loan number





Rates31.12.2015

Carrying amount


days

More than 90

days

More than 1 up to 3

years








Brazilian reais Monthly 5.00 5.00 629,542 1,888,627 - - - - - 2,518,169


Brazil Banco Itauleasing S.A Brazilian reais Monthly 16.70 16.70 3,373 10,224 - - - - - 13,597


Brazil Banco Santander Brazilian reais Monthly 16.69 16.69 65,470 177,491 202,970 10,677 - - - 456,608


Brazil Banco Itaucard S.A Brazilian reais Monthly 16.78 16.78 7,018 17,330 15,607 - - - - 39,955

6-81 88.579.800-4 Microgeo Chile Banco de Credito e Inversiones UF Monthly 4.92 4.92 6,460 19,950 2,952 - - - - 29,362












18-81 Foreign Sonda Brasil Brazil Banco Itaucard S.A Brazilian reais Monthly 17.68 17.68 15,877 48,144 6,118 - - - - 70,139



21-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 1.23 1.22 468 - - - - - - 468

















Loan number





Rates31.12.2015

Carrying amount


days

More than 90

days

More than 1 up to 3

years































63-81 Foreign Sonda de Colombia Colombia Banco Occidente Colombian pesos Monthly 0.02 0.02 666 1,994 2,658 2,658 2,437 - - 10,413



66-81 Foreign Sonda de Colombia Colombia Bancolombia Colombian pesos Monthly 0.35 0.35 826 2,481 3,308 551 - - - 7,166














80-81 Foreign Sonda Peru Peru CSI Renting Peru S.A.C. US Dollar Monthly 5.65 5.65 - 73,137 109,747 109,702 - - - 292,586

81-81 Foreign Telsinc Servicios Brazil Santander leasing S.A Brazilian reais Monthly 17.68 17.68 3,215 4,709 - - - - - 7,924

Total 1,317,371 3,184,980 1,493,522 372,507 33,416 - - 6,401,796

(4) Bonds (unsecured)

• On December 18, 2009, SONDA placed the following series of bonds in the local market:

i. UF 1,500,000 of Series A bonds were placed under the securities register No.622, and have a maturity of five years at an annual fixed interest rate of 3.5%.

ii. UF 1,500,000 of Series C bonds were placed under the securities register No.621, and have a maturity of 21 years at an annual fixed interest rate of 4.5%.

The maximum aggregate nominal amount considering both bonds is UF 3.000.000.


• In November 2014, was issued with charge to the Line 622 a new Bond Series E with a nominal value of ThCh$36,300,000 and maturity on November 1, 2019. This bond bears a nominal annual interest rate of 5.4% (effective interest rate of 4.76%).

These issuances do not include guarantees.

The details of other bonds are as follows:

Taxpayer number

Debtor name

Type of document Country Indexation unit Amortisation

typeMaturity date

Rates

12.31.2016


Effective Nominal

Up to 90 days

More than 90 days

More than 1 up to 3

years

More than 2 up to 3

years

More than 3 up to 4

years

More than 4 up to 5

yearsMore than

5 years Total

83.628.100-4 SONDA S.A. BSOND-C CHILE UF Maturity 01-12-2030 3.90 4.50 - 1,750,629 1,750,629 1,750,629 5,293,349 5,127,730 38,987,968 54,660,934

83.628.100-4 SONDA S.A. BSONS-E CHILE Chilean peso Maturity 01-11-2019 4.70 5.40 - 1,934,427 1,934,427 38,234,427 - - 42,103,281

Total - 3,685,056 3,685,056 39,985,056 5,293,349 5,127,730 38,987,968 96,764,215

Taxpayer number

Debtor name


typeMaturity date

Rates

12.31.2016

Carrying amount

Effective Nominal

Up to 90 days

More than 90 days

More than 1 up to 3

years

More than 2 up to 3

years

More than 3 up to 4

years

More than 4 up to 5

yearsMore than

5 years Total

83.628.100-4 SONDA S.A. BSOND-C CHILE UF Maturity 01-12-2030 3.90 4.50 - 465,586 - - - - 39,171,740 39,637,326

83.628.100-4 SONDA S.A. BSONS-E CHILE Chilean peso Maturity 01-11-2019 4.70 5.40 - - - 36,870,842 - - - 36,870,842

Total - 465,586 - 36,870,842 - - 39,171,740 76,508,168

Taxpayer number

Debtor name


typeMaturity date

Rates

12.31.2015


Effective Nominal

Up to 90 days

More than 90 days

More than 1 up to 3

years

More than 2 up to 3

years

More than 3 up to 4

years

More than 4 up to 5

yearsMore than

5 years Total

83.628.100-4 SONDA S.A. BSOND-C CHILE UF Maturity 01-12-2030 3.90 4.50 - 1,710,896 1,710,896 1,710,896 1,710,896 5,173,206 43,114,410 55,131,200

83.628.100-4 SONDA S.A. BSONS-E CHILE Chilean peso Maturity 01-11-2019 4.70 5.40 - 1,934,427 1,934,427 1,934,427 38,234,427 - - 44,037,708

Total - 3,645,323 3,645,323 3,645,323 39,945,323 5,173,206 43,114,410 99,168,908

Taxpayer number

Debtor name


typeMaturity date

Rates

12.31.2015

Carrying amount

Effective Nominal

Up to 90 days

More than 90 days

More than 1 up to 3

years

More than 2 up to 3

years

More than 3 up to 4

years

More than 4 up to 5

yearsMore than

5 years Total

83.628.100-4 SONDA S.A. BSOND-C CHILE UF Maturity 01-12-2030 3.90 4.50 - 140,237 - - - - 38,078,471 38,218,708

83.628.100-4 SONDA S.A. BSONS-E CHILE Chilean peso Maturity 01-11-2019 4.70 5.40 - 318,862 - - 37,072,435 - - 37,391,297

Total - 459,099 - - 37,072,435 - 38,078,471 75,610,005

Categories of financial liabilities:

12.31.2016 12.31.2015

ThCh$ ThCh$

Categories of non-current financial liabilities Non- current Financial liabilities at fair value through profit or loss

Total non-current financial liabilities at fair value through profit or loss - -

Non-current financial at amortized cost 82,667,509 78,641,323

Total non-current financial liabilities 82,667,509 78,641,323

Categories of current financial liabilitiesCurrent Financial liabilities at fair value through profit or loss

Total current financial liabilities at fair value through profit or loss 2,098,166 -

Current financial at amortized cost 81,172,129 13,307,865

Total current financial liabilities 83,270,295 13,307,865

Categories of financial liabilities Financial liabilities at fair value through profit or loss

Total financial liabilities at fair value through profit or loss 2,098,166 -

Financial at amortized cost 163,839,638 91,949,188

Total financial liabilities 165,937,804 91,949,188


20. HEDGING ASSETS AND LIABILITIES

Derivative instruments held by the Company are principally to hedge the variability of cash flows due the foreign exchange rate changes related to future investments in assets denominated in foreign currencies. Derivative instruments and hedge accounting are entered into in accordance with the Company’s hedging policy.

At the inception of the hedge it has determined that the hedging relationships qualify as a fair value hedge.

The tables below set forth the positions for the foreign exchange rate derivatives as of December 31, 2016 and 2015 which are disclosed in other financial assets or other financial liabilities as appropriate.

Type of derivative

Type of contract

Derivative contracts description 12.31.2016 Contract

Price Maturity date Specific Item

Buy/sell Position Name Assets / Liabilities

Carrying amount

Profit/ loss recognition

Profit/ loss unrecognized

ThCh$ ThCh$ ThCh$ ThCh$ Current

CFH FORWARD 255.155 03-01-17 Foreign exchange Buy Trade payables Hedge assets 1,928 1,928 -







FVH SWAP 38.395.515 30-06-17 Foreign exchange - Financial liability Hedge liability 342,425 831,704 (1,174,129)

FVH SWAP 12.019.888 20-06-20 Foreign exchange - Financial liability Hedge liability 1,755,741 - -

2,135,914 869,453 (1,174,129)

21. TRADE AND OTHER PAYABLES

a) The details of this item are as follows:

Non-current payables 12.31.2016 12.31.2015

ThCh$ ThCh$ Non-current payables (3) 14,336,265 16,964,770 Trade and other current payables Trade and other current payables to suppliers (1) 85,376,902 96,093,357 Accumulated (or accrued) payables (2) 26,842,327 23,609,398 Total trade and other current payables 112,219,229 119,702,755 Trade and other payables Trade and other payables to suppliers 99,713,167 113,058,127 Accumulated (or accrued) payables 26,842,327 23,609,398 Total trade and other payables 126,555,494 136,667,525


(1) The composition of trade and other current payables is as follows:

Trade and other payables 12.31.2016 12.31.2015

ThCh$ ThCh$ Trade payables 72,805,917 73,504,425 Lease liabilities 205,699 72,261 Dividends payable (1.a) 1,622,649 6,160,805 Provision for costs of projects 390,793 1,021,035 Invoices and documents to be received 6,834,587 11,628,136 Contingent consideration in business combination (1.b) 1,592,940 2,336,105 Installment tax payment program (1.c) 1,924,317 1,370,590 Total trade and other payables 85,376,902 96,093,357

(1.a) Corresponds to the non-controlling interest portion of the minimum dividend recognized under the dividend distribution policy of SONDA.(1.b) Correspond to price adjustments payable arising from acquisitions of companies, which are contractually established at the acquisition date. The estimates of the contingent consideration is based on the results that acquired companies will obtain in subsequent years since their acquisition.

The details of the price adjustments payable are as follows:

12.31.2016 12.31.2015 Current Non-current Total Current Non-current

Total ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Elucid Solutions S.A. 1,592,940 - 1,592,940 374,695 1,124,085 1,498,780Ctis Tecnologia S.A. - 5,757,069 5,757,069 1,961,410 7,069,246 9,030,656Total 1,592,940 5,757,069 7,350,009 2,336,105 8,193,331 10,529,436

• ELUCID: corresponds to the price adjustment payable which was established as escrow upon this acquisition. The securities will be partially released until 2017.

• CTIS: the price adjustment payable has been estimated based on projections of results that the acquired company will obtain in the 5 years after the acquisition date (2014-2018), and the measurement was made at the present value of the obligation.

(1.c) Corresponds to tax payment agreements of the subsidiary CTIS. These payment agreements were generated under conditions set by the tax legislation, which grant a period from 30 to 180 months for the payment of the obligations.

This account payable is monthly updated based on the interest rate and adjustments in force in Brazil.

(2) Accumulated (or accrued) payables are as follows:

Accumulated or accrued current liabilities 12.31.2016 12.31.2015

ThCh$ ThCh$ Employees' vacation provision 19,830,856 16,568,848 Salaries, commisions and other payable 847,002 784,184 General Services 5,099,629 5,022,253 Other 1,064,840 1,234,113 Total 26,842,327 23,609,398

(3) Non-current payables to suppliers are as follows:

Non- current payables 12.31.2016 12.31.2015

ThCh$ ThCh$ Trade payable 2,799,073 2,708,496 Contingent consideration in business combination (1.b) 5,757,069 8,193,331 Installment tax payment program (1.c) 5,689,571 5,970,273 Other payables 90,552 92,670Total non-current payables 14,336,265 16,964,770


b) The aging analysis of up-to-date and overdue trade payables by type of supplier is as follows:

Suppliers payments up to date12.31.2016 12.31.2015

Goods Services Other Total Goods Services Other Total ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Current invoices according to term Up to 30 days 38,766,282 10,940,328 1,460,952 51,167,562 47,712,514 9,894,120 271,260 57,877,894 More than 31 up to 60 days 8,763,202 1,167,246 2,491,283 12,421,731 6,908,168 3,754,938 2,718 10,665,824 More than 61 up to 90 days 3,887,383 212,501 - 4,099,884 521,481 486,106 2,662 1,010,249 More than 91 up to 120 days 184,843 164,508 - 349,351 105,456 43,298 - 148,754 More than 121 up to 365 days 79,780 183,596 - 263,376 103,862 508,001 - 611,863 More than 365 days - - - - - - - -Total 51,681,490 12,668,179 3,952,235 68,301,904 55,351,481 14,686,463 276,640 70,314,584

Suppliers payments overdue Overdue invoices according to term Up to 30 days 97,796 488,453 730,217 1,316,466 752,029 661,931 462,038 1,875,998 More than 31 up to 60 days 116,590 71,377 231,254 419,221 216,441 144,981 24 361,446 More than 61 up to 90 days 222,937 47,048 1,261,427 1,531,412 127,632 49,695 - 177,327 More than 91 up to 120 days 75,107 (10,918) 5,436 69,625 80,379 68,042 - 148,421 More than 121 up to 365 days 689,703 237,269 240,317 1,167,289 37,523 589,126 - 626,649 More than 365 days - - - - - - - -Total 1,202,133 833,229 2,468,651 4,504,013 1,214,004 1,513,775 462,062 3,189,841

Total trade payable 52,883,623 13,501,408 6,420,886 72,805,917 56,565,485 16,200,238 738,702 73,504,425

The average payment period of up-to-date trade payables fluctuates between 30 and 45 days for normal sales operations. Some transactions associated with projects with certain suppliers may have a longer payment period up to 120 days.

22. OTHER PROVISIONS

a) The details of other provisions as of December 31,2016 and 2015 are as follows:

Classes of other provision 12.31.2016 12.31.2015

ThCh$ ThCh$ Provision for litigations (1) Long-term provision for litigations 3,958,290 2,043,172 Short-term provision for litigations 4,069,806 2,382,610 Total provisión for litigation 8,028,096 4,425,782 Other provisions Other long-term provisions 462,489 469,458 Other short-term provisions (*) 5,453,384 4,812,831 Total other provisions 5,915,873 5,282,289 Total other provisions Other long-term provisions 4,420,779 2,512,630 Other short-term provisions 9,523,190 7,195,441Total other provisions 13,943,969 9,708,071

(1)Litigations: The Company and its subsidiaries recognize provision for litigations that are likely to have an unfavorable outcome to the Company.(*) Includes a provision for ThCh$3,586,257 (ThCh$ 3,106,917 as of December 31, 2015). See Note 33 I.2.1b)


b) The changes of the main provision are as follows:

Provision for litigations Other provision

Total Other provisions

ThCh$ ThCh$ ThCh$ Balance at 01.01.2015 (Current and Non-current) 4,333,152 6,620,120 10,953,272

Changes in provisions:

Increase in existing provision 2,145,146 3,425,554 5,570,700

Provision used (782,715) (2,712,088) (3,494,803)

Reversed unused provision (665,947) - (665,947)

Foreign currency translation differences (603,854) (2,051,297) (2,655,151)

Total changes in provisions 92,630 (1,337,831) (1,245,201)

Balance at 12.31.2015 (Current and Non-current) 4,425,782 5,282,289 9,708,071

Changes in provision:

Increase in existing provision 2,919,044 1,411,265 4,330,309

Provisions acquired in a business combination 353,239 - 353,239

Provision used (307,909) (1,252,864) (1,560,773)

Reversed unused provision (211,632) - (211,632)

Foreign currency translation differences 849,572 475,183 1,324,755

Total changes in provision 3,602,314 633,584 4,235,898

Balance at 12.31.2016 (Current + Non-current) 8,028,096 5,915,873 13,943,969

23. PROVISIONS FOR EMPLOYEE BENEFITS

The Company and its subsidiaries have contractual obligations and other additional benefits with their employees. The detail of the provision for employee benefits is as follows:

Classes of provision 12.31.2016 12.31.2015

ThCh$ ThCh$ Non-current defined benefit obligation (1)

Severance indemnities 2,334,884 2,204,773

Quinquenial service awards 1,054,112 1,080,485

Total non-current defined benefit obligation 3,388,996 3,285,258

Profit-sharing and bonuses payable, current (2)

Profit-sharing and bonuses payable, current 3,723,966 4,764,777

Other benefits

Other current benefits 1,676,015 1,174,905

Total benefits to employees

Non-current provision 3,388,996 3,285,258

Current provision 5,399,981 5,939,682

Total Provision 8,788,977 9,224,940

(1) Provisions are determined as described in Note 3.2.p)


(1.i) Changes in provisions for employee benefits are as follows:

Severance indemnities

Five-year Service award

Total long- term defined Benefits

ThCh$ ThCh$ ThCh$ Balance at 01.01.2015 1,892,212 893,884 2,786,096 Current service cost 1,154,983 377,518 1,532,501 Interest cost 76,635 36,202 112,837 Exchange difference of foreign plan 128,225 - 128,225 Benefits paid (710,919) (221,436) (932,355) Derecognised provision not used (313,229) - (313,229) Amounts of defined benefit recognised in profit and loss 335,695 192,284 527,979 Amounts of defined benefit recognised in comprehensive income (23,134) (5,683) (28,817) Balance at 12.31.2015 2,204,773 1,080,485 3,285,258 Current service cost 618,807 139,263 758,070 Interest cost 91,586 43,760 135,346 Exchange difference of foreign plan (195,135) - (195,135) Benefits paid (161,851) (163,182) (325,033) Derecognised provision not used (249,898) - (249,898) Amounts of defined benefit recognised in profit and loss 103,509 19,841 123,350 Amounts of defined benefit recognised in comprehensive income 26,602 (46,214) (19,612) Balance at 12.31.2016 2,334,884 1,054,112 3,388,996

(1.ii) The main assumptions used in the actuarial calculation of provisions for employee benefits are as follows:

Chile México Ecuador 12.31.2016 12.31.2015 12.31.2016 12.31.2015 12.31.2016 12.31.2015

Nominal discount rate 4.59% 5.16% 6.20% 6.50% 4.50% 6.31%Expected salary increase rate 0%-2% 0%-2% 6.50% 6.50% 2.00% 3.00%Voluntary turnover rate 16.59% 16.02% 24.00% 24.00% 19.77% 20.87% Age of retirement Men 65años 65años 65años 65años (*) (*)Women 60años 60años 65años 65años (*) (*)Mortality table M-2014 M-2009 EMSSA-09 EMSSA-09 TMIESS2002 TMIESS2002

(*) 25 years of consecutive or permanent service, no age of retirement required (Labour Law).

(2) Profit-sharing and bonuses: Correspond to the obligation of the Company and its subsidiaries with its employees for annual and other bonuses that are paid in the following year, and will depend on fulfillment of certain conditions.

Changes in profit-sharing and bonuses provision are as follows:

Share of profits and bonuses ThCh$

Balance at 01.01.2015 4,977,252 Increase for the year 4,113,676 Provision used (3,405,220) Reversed unused provision (379,325) Foreign currency translation differences (541,606) Total movements of provision (212,475)

Balance at 31.12.2015 4,764,777 Increase for the year 2,690,439 Provision used (3,386,100) Reversed unused provision (394,270) Foreign currency translation differences 49,120 Total movements of provision (1,040,811)

Balance at 31.12.2016 3,723,966


24. OTHER NON-FINANCIAL LIABILITIES

The details of other non-financial liabilities are as follows:

Other non-financial liabilities Current

12.31.2016 12.31.2015 ThCh$ ThCh$

Withholdings 9,593,877 8,444,989

Advances from customers 588,600 476,724

Other tax payable 666,580 1,653,962

Unearned income (1) 7,449,548 11,720,064

Other 3,368,377 3,634,183

Total 21,666,982 25,929,922

Other non-financial liabilities Non-current

12.31.2016 12.31.2015 ThCh$ ThCh$

Unearned income (1) 2,617,258 2,076,306

Other (2) 3,174,023 755,628

Total 5,791,281 2,831,934

(1) The details of unearned revenue are as follows:

Current Non-current 12.31.2016 12.31.2015 12.31.2016 12.31.2015

ThCh$ ThCh$ ThCh$ ThCh$ Sales in advance-maintenance contracts (a) 3,773,370 4,903,845 2,616,640 1,484,274

Sales in advance-installation projects (b) 377,524 850,520 - -

Sales in advace for services not rendered 3,298,654 5,965,699 618 592,032

Total 7,449,548 11,720,064 2,617,258 2,076,306

(a) Correspond to equipment maintenance and technical support contracts which are collected in advance.(b) Correspond to partial billings of projects in progress for services that have not yet been rendered.

(2) In 2016 an amount is included for the former controlling shareholders of ATIVAS DATACENTER S.A. (Note 3.2.a to 9), regarding an obligation contracted in the purchase agreement of said Company, which establishes that the tax benefits associated with tax losses used by ATIVAS and which exceed the amount stipulated in said agreement will go to the former controlling shareholders.


25. EQUITY

Equity changes:

(a) Issued Capital

As of December 31, 2016 and 2015, the issued capital was ThCh$373,119,044 and is divided into 871,057,175 no par value shares of a single series.

Single series Number of authorized shares 871,057,175

Number of issued shares

Number of issued and fully paid ordinary shares 871,057,175

Number of issued and partially paid ordinary shares -

Total number of issued shares 871,057,175

Reconciliation of the number of issued shares

Number of issued shares as of 01.01.2015 871,057,175

Issued and fully paid shares -

Issued and unpaid shares -

Change in the number of issued shares -

Number of issued shares as of 12.31.2015 871,057,175 Issued and fully paid shares -

Issued and unpaid shares -

Number of issued shares as of 12.31.2016 871,057,175

(b) Dividend Policy

For the year 2016, the Board of Directors informed to the Ordinary Shareholders’ Meeting held on April 21, 2016 to distribute dividends equivalent to 50% of the profits for the year, payable by means of an interim dividend at the end of the first half of the year equivalent to 50% of the profits earned by the Company at that date, and a final dividend to be agreed to by the Ordinary Shareholders’ Meeting once the period has ended.

At a Board of Directors Meeting held on August 22, 2016, it was agreed to distribute an interim dividend of $ 11,450,961,175.- charged to the profits for the year to June 30, 2016 and, in accordance with the shares subscribed and Paid as of the date of this notice, corresponding to 871,057,175 shares, amounted to $ 13.14605 per share.

At the Ordinary Shareholders' Meeting held on April 21, 2016, it is stated that, in the approved Consolidated Financial Statements, the profits for the year 2015 after taxes amounted to $ 42,850,330,247.- (forty-two thousand eight hundred and fifty million three hundred and thirty thousand two hundred forty-seven pesos). It was noted that on September 1, 2015, an amount amounting to $ 10,368,907,821 (ten thousand three hundred sixty-eight million nine hundred and seven thousand eight hundred and twenty-one pesos) was paid as a provisional dividend, corresponding to $ 11.90382.- per share, charged to earnings for the period to June 30, 2015. It

was added that the Board of Directors, in a meeting held on March 21, 2016, agreed to propose to the Shareholders' Meeting the distribution of a final dividend of $ 12.69292 per share, that added to the provisional dividend means a total dividend of $21,425,166,859 (Twenty-one thousand, four hundred and twenty-five million, one hundred and sixty-six thousand, eight hundred and fifty-nine pesos), with a charge to the profits of the fiscal year ending on December 31, 2015, which is equivalent to 50% of the total profit for that year.

During the Ordinary Shareholders' Meeting held on April 22, 2015, it was agreed to distribute a final dividend of ThCh$10,563,162 against net income for the year ended December 31, 2014, which according to the 871,057,175 subscribed and paid shares as of such date, equals $12.12683 per share. When adding the interim dividend of ThCh$13,206,577 paid on September 1, 2014, equals Ch$15.16155 per share, it represents a total dividend of ThCh$23,769,739 against net income for year ended December 31, 2014, which was equivalent to 50% of total net income for that year. This dividend was paid to the shareholders effective on May 4, 2015.

(c) Other Reserves

12.31.2016 12.31.2015 ThCh$ ThCh$

Reserve of exchange difference translation (2) (78,405,134) (105,775,876)Cash flow hedging reserves (807,159) - Reserve profit (losses) on investments of equity instruments 4,120,064 -

Reserve od actuarial gains or losses in defined benefit plans 230,324 221,701

Other miscellaneous reserves (1) 1,313,610 1,313,610 Total other reserves (73,548,295) (104,240,565)

(1) The detail of Other miscellaneous reserves is as follows:

12.31.2016 12.31.2015 ThCh$ ThCh$

Other miscellaneous reserves: Expenses attributable to the issuance of shares (1.1) (4,404,641) (4,404,641)

Pooling of interest (1.2) (1,119,613) (1,119,613)Sonda Colombia (Red Colombia) merger (299,803) (299,803)Price difference in issuance of preferred shares (1.3) 1,130,817 1,130,817Price-level restatement of issued capital, IFRS adoption year (1.4) 5,403,585 5,403,585

Changes in controlling interests (1.5) 141,182 141,182Other reserves 462,083 462,083Total 1,313,610 1,313,610

(1.1) Expenses attributable to the issuance of shares made in November 2006 and December 2012.

(1.2) The Company, in accordance with IFRS 1, classified within other miscellaneous reserves past acquisitions of ownership interests in companies under common control, which were accounted for under Chilean GAAP using the pooling-of-interest method. The differences originated in these acquisitions were recognized in equity (“Other miscellaneous reserves”).


(1.3) At the Board of Directors’ Meeting held on December 19, 2006, it was agreed to grant a share option program to acquire SONDA S.A.’s shares to certain executives of the Company and its subsidiaries, who will be chosen from time to time by the Board of Directors based on their seniority, position and significance in profit generation, amount of equity that they directly manage, performance, potential of development, academic background and expertise.

On July 3, 2009, the three-year period for payment of 33,504,000 shares expired, these shares were used to the compensation plans for the executives of SONDA S.A. and its subsidiaries. The number shares effectively paid at vesting date were 4,561,175, which were measured at fair value for ThCh$ 1,130,817 which were included in other reserves.

(1.4) As required by Circular No.456 of the Chilean Superintendence of Securities and Insurance, the price-level restatement of the issued capital during the IFRS transition period was recognized within “Other Miscellaneous Reserves”.

(1.5) Corresponds to the effects recognized for changes in ownership interests due in certain subsidiaries that do not result in loss of control. In accordance with IAS 27, the changes in the Company’s ownership interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

(2) The table below sets forth the movements in the reserve of exchange differences on translation of foreign operations:

Items 01.01.2015 Movement 12.31.2015

ThCh$ ThCh$ ThCh$ CTIS Tecnología S.A. (8,582,926) (22,524,379) (31,107,305)

Elucid Solutions S.A. - reserve of exchange differences of investment (4,238,721) (11,752,549) (15,991,270)

Kaizen Inf e Partic. Soc. Ltda. (1,141,078) - (1,141,078)

Microgeo S.A.- reserve of exchange differences of investment 269,509 836,051 1,105,560

Novis México- reserve of exchange differences of investment 15,160 - 15,160

Pars Produtos de Process. De Dados - reserve of exchange differences of investment (5,126,126) (9,338,115) (14,464,241)

Quintec Filiales Operativas S.A. - reserve of exchange differences of investment (123,963) 136,710 12,747

Solex Colombia S.A. - reserve of exchange differences of investment (6,517) (2,138) (8,655)

Sonda Argentina- reserve of exchange differences of investment (5,576,537) (1,677,424) (7,253,961)

Sonda Brasil- reserve of exchange differences of investment (3,629,945) (2,421,077) (6,051,022)

Sonda Brasil- reserve of exchange differences of goodwill (739,884) (851,191) (1,591,075)

Sonda Costa Rica- reserve of exchange differences of investment 318,015 797,029 1,115,044

Sonda de Colombia- reserve of exchange differences of investment (908,768) (1,367,842) (2,276,610)

Sonda de Colombia- reserve of exchange differences of goodwill (64,709) (58,208) (122,917)

Sonda Ecuador- reserve of exchange differences of investment 259,202 981,223 1,240,425

Sonda Ecuador- reserve of exchange differences of goodwill (2,337) 8,140 5,803

Sonda México- reserve of exchange differences of investment 4,994,656 6,831,515 11,826,171

Sonda México- reserve of exchange differences of goodwill (160,325) (7,600) (167,925)

Sonda Panamá- reserve of exchange differences of investment (7,313) (7,715) (15,028)

Sonda Perú- reserve of exchange differences of investment 437,099 173,498 610,597

Sonda Perú- reserve of exchange differences of goodwill 89 1,554 1,643

Sonda Procwork Ltda.- reserve of exchange differences of investment (16,972,821) (16,734,414) (33,707,235)

Sonda Uruguay- reserve of exchange differences of investment 53,481 446,711 500,192

Sonda Uruguay- reserve of exchange differences of goodwill (25,154) 87,580 62,426

Tecnoglobal S.A- reserve of exchange differences of investment (44,023) 2,665,481 2,621,458

Tecnoglobal S.A- reserve of exchange differences of goodwill (24,238) 84,392 60,154

Telsinc Comercio de Equipamento de inf. Ltda (2,978,754) (1,970,235) (4,948,989)

Telsinc Prest. de Serv. para Sist de Inf. Ltda (2,755,078) (3,350,867) (6,105,945)

Sonda Procwork Outsourcing Informatica Ltda. - - -

Acepta Perú - - -

Total (46,762,006) (59,013,870) (105,775,876)


Items01.01.2016 Movement 12.31.2016

ThCh$ ThCh$ ThCh$ CTIS Tecnología S.A. (31,107,305) 13,443,229 (17,664,076)

Elucid Solutions S.A. - conversión de la inversión (15,991,270) 6,902,228 (9,089,042)

Kaizen Inf e Partic. Soc. Ltda. (1,141,078) (1,141,078)

Microgeo S.A.- conversión de la inversión 1,105,560 (332,353) 773,207

Novis México- conversión de la inversión 15,160 - 15,160

Pars Produtos de Process. De Dados - conversión de la inversión (14,464,241) 5,040,322 (9,423,919)

Quintec Filiales Operativas S.A. - conversión de la inversión 12,747 (3,324) 9,423

Solex Colombia S.A. - conversión de la inversión (8,655) - (8,655)

Sonda Argentina- conversión de la inversión (7,253,961) (1,937,619) (9,191,580)

Sonda Brasil- conversión de la inversion (6,051,022) 1,111,458 (4,939,564)

Sonda Brasil- conversión del goodwill (1,591,075) 468,700 (1,122,375)

Sonda Costa Rica- conversión de la inversión 1,115,044 (335,626) 779,418

Sonda de Colombia- conversión de la inversion (2,276,610) (408) (2,277,018)

Sonda de Colombia- conversión del goodwill (122,917) - (122,917)

Sonda Ecuador- conversión de la inversion 1,240,425 (417,336) 823,089

Sonda Ecuador- conversión del goodwill 5,803 (3,203) 2,600

Sonda México- conversión de la inversión 11,826,171 (5,334,309) 6,491,862

Sonda México- conversión del goodwill (167,925) (77,529) (245,454)

Sonda Panamá- conversión de la inversion (15,028) 555 (14,473)

Sonda Perú- conversión de la inversión 610,597 (353,390) 257,207

Sonda Perú- conversión del goodwill 1,643 (2,500) (857)

Sonda Procwork Ltda.- conversión de la inversión (33,707,235) 8,125,517 (25,581,718)

Sonda Uruguay- conversión de la Inversión 500,192 (163,523) 336,669

Sonda Uruguay- conversión del goodwill 62,426 (34,461) 27,965

Tecnoglobal S.A- conversión de la inversión 2,621,458 (1,054,431) 1,567,027

Tecnoglobal S.A- conversión del goodwill 60,154 (33,207) 26,947

Telsinc Comercio de Equipamento de inf. Ltda (4,948,989) 961,332 (3,987,657)

Telsinc Prest. de Serv. para Sist de Inf. Ltda (6,105,945) 1,978,589 (4,127,356)

Sonda Procwork Outsourcing Informatica Ltda. - (567,782) (567,782)

Acepta Perú - (10,187) (10,187)

Total (105,775,876) 27,370,742 (78,405,134)

(d) Distributable Net Income

In determining net income to be distributed as dividends, the Company has adopted a policy of making no adjustments to the line item “Profit (loss) attributable to owners of parent” in the statement of comprehensive income for the year.

(e) IFRS First-Time Adoption Adjustments

The Company has adopted a policy of separately track the IFRS first-time adoption adjustments recognized in “Retained earnings” in the statement of changes in equity, in order to determine which of those adjustments have been realized, and as a result are available to distribute as dividends, at the end of each reporting period.

The IFRS first-time adoption adjustments attributable to owners of the parent recognized on January 1, 2010, resulted in an aggregate net credit to retained earnings. The unrealized balances are mainly related to foreign exchange translation differences from foreign operations.


The table below sets forth the unrealized portion of the IFRS first-time adoption adjustments (i.e., not yet available to distribute as dividends):

First-time adoption adjustments

Amount realized for the year

Unrealized balance as of 12-31-2015

Amount realized for the year

Unrealized balance as of 12-31-2016

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Unrealized adjustments:

Foreign exchange translation differences 17,885,780 - 17,885,780 - 17,885,780

Negative Goodwill 799,287 - 799,287 - 799,287

Total 18,685,067 - 18,685,067 - 18,685,067

During the years 2016 and 2015, the Company has not disposed of any foreign operation. Consequently, none of the IFRS first-time adoption adjustments related to foreign operations have been realized.

(f) Capital management

Capital management refers to management of the Company’s equity. The purpose of the capital management policies of SONDA S.A. are:

• Ensure that its operations work normally and the continuity of the business in the long-term.• Ensure the financing of new investments in order to maintain sustained growth over time.• Maintain a capital structure in line with the economic cycles impacting the business and the nature of the industry.• Maximize the value of the Company, providing an adequate return for the shareholders.

The capital requirements are incorporated based on the company’s financing needs, taking care to maintain an adequate level of liquidity and complying with the financial safeguards stipulated in the current debt contracts. The company manages its capital structure and makes adjustments based on prevailing economic conditions, so as to mitigate the risks associated with adverse market conditions and taking advantage of the opportunities generated to improve the company’s liquidity position.

(g) Non-controlling interests

The details of non-controlling interests are as follows:

Empresas

Non-controlling interests

Country %

Financial Statement

type

Non-controlling interests - Equity

Non-controlling interests - Profit and Loss

12.31.2016 12.31.2015 12.31.2016 12.31.2015 ThCh$ ThCh$ ThCh$ ThCh$

SERVIBANCA S.A. Chile 13.2500% Separate 295,393 307,970 191,579 132,111INMOBILIARIA SERVIBANCA S.A. Chile 13.2500% Separate 217,250 228,001 11,828 19,202MICROGEO S.A. Chile 20.0000% Consolidated 1,475,865 1,444,677 174,277 119,706NOVIS S.A. Chile 40.0000% Separate 826,120 786,569 86,754 78,672NOVIS MEXICO S.A. México 40.0000% Separate 688,782 642,832 335,559 269,618QUINTEC FILIALES OPERATIVAS S.A. Chile 0.1898% Consolidated 22 18 4 7SOLEX S.A. Chile 49.9998% Separate 479,765 609,844 219,998 211,229SOLEX COLOMBIA S.a.S. Colombia 49.9998% Separate 34,448 22,890 11,633 7,793TRANSACCIONES ELECTRONICAS S.A. Chile 49.9999% Consolidated 2,262,256 1,383,647 2,960,632 2,599,181TRANSACCIONES ELECTRONICAS DOS S.A. Chile 49.9999% Consolidated 1,156,760 709,388 645,281 460,076ACEPTA S.A. Chile 49.9999% Separate 1,601,909 1,265,837 1,167,672 839,008WIRELESS-IQ S.A. Chile 33.0000% Consolidated (600,182) (562,837) (37,347) (42,201)ATIVAS DATA CENTER S.A. Brazil 40.00% Consolidated - - (236,628) - Total 8,438,388 6,838,836 5,531,242 4,694,402


26. REVENUE

Revenue for the years ended December 31, 2016 and 2015 are as follows:

12.31.2016 12.31.2015 ThCh$ ThCh$

Platforms 318,510,504 353,610,262 IT Services 497,648,340 537,512,175 Total 816,158,844 891,122,437

27. OTHER INCOME

The details of other income for the years ended December 31, 2016 and 2015 are as follows:

Other revenue 12.31.2016 12.31.2015

ThCh$ ThCh$ Recovery of non-recurring expenses 214,373 349,899 Price adjusments business combinations (1) 4,330,207 1,511,007 Gain on sales of investments in associates (2) - 768,911 Gain on sales of fixed assets (3) 145,638 1,581,151 Reversal of provisions 96,985 165,324 Other 885,076 573,235 Total 5,672,279 4,949,527

(1) Corresponds to the reversal of the provision made up by amounts of the balances of the price to be paid (contingent remuneration, see Note 21) for the purchase of CTIS in Brazil, which originates for not complying with certain indicators agreed upon in the purchase agreement. (2) It corresponds to the funds received from the escrow account related to the sale of the investee Payroll S.A. (3) It includes mainly income from the sale of investment properties, as discussed in Note 15.

28. DEPRECIATION AND AMORTIZATION

Depreciation and amortization expense for the years ended December 31, 2016 and 2015, are as follows:

12.31.2016 12.31.2015 ThCh$ ThCh$

Depreciation (*) 25,216,371 23,694,431 Intangible amortization (**) 7,010,005 8,503,706 Projects amortization 1,573,653 1,418,933

Total 33,800,029 33,617,070

(*) Includes aggregate depreciation expense of property, plant and equipment and investment property.(**) ThCh$2,211,814 correspond to amortizations of intangible assets arising from business combinations (ThCh$4,206,682 in 2015).


29. OTHER EXPENSES BY FUNCTION

The details of other expenses by function for the years ended December 31, 2016 and 2015 are as follows:

12.31.2016 12.31.2015 ThCh$ ThCh$

Contingencies (1) 4,069,490 2,216,873 Acquisition expenses 126,632 156,904 Restructuring expense (2) 4,872,025 5,459,229 Extraordinary taxes (3) 269,073 122,292 Price adjusment (4) 2,895,314 - Other expenses 2,225,922 2,518,988

Other expenses by function 14,458,456 10,474,286

(1) It includes payments for civil lawsuits, labor disputes and legal fees.(2) Correspond to restructuring expense from the restructuring process implemented in Brazilian during 2016 and 2015.(3) It corresponds to the equity tax levied on companies in Colombia, whose obligation was incurred on January 1, in each year.(4) Corresponds to the price adjustment paid to the previous owner of PARS as shown in Note 18.

30. COST OF SALES

The details of cost of sales is as follows:

12.31.2016 12.31.2015 ThCh$ ThCh$

Salary 281,797,713 288,248,775 Depreciation and amortization 33,800,029 33,617,070 Inventory cost of sales 257,168,619 283,773,766 Other expenses 98,798,858 122,709,515 Total 671,565,219 728,349,126

31. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

Categories of Financial Instruments

12.31.2016 12.31.2015Carrying amount Fair value Carrying amount Fair value

ThCh$ ThCh$ ThCh$ ThCh$ Financial Assets Cash 26,977,408 26,977,408 25,443,781 25,443,781 Short-term time deposits 5,980,311 5,980,311 7,634,998 7,634,998 Mutual Funds 31,459,620 31,459,620 35,313,395 35,313,395 Cash and cash equivalent 64,417,339 64,417,339 68,392,174 68,392,174 Financial instruments at fair value 2,104,940 2,104,940 330,797 330,797 Other current financial assets 24,946,115 24,946,115 1,389,451 1,389,451 Other non-current financial assets 4,013,333 4,013,333 50 50 Other financial assets 31,064,388 31,064,388 1,720,298 1,720,298 Trade and other receivables 198,640,837 198,640,837 232,264,414 231,688,517 Current account receivables from related companies 3,045,248 3,045,248 3,089,539 3,665,436 Non-current receivables 24,455,534 24,455,534 16,560,559 16,560,559 Non-current account receivables from related companies 4,331,311 4,331,311 3,372,317 3,372,317 Trade and other receivables 230,472,930 230,472,930 255,286,829 255,286,829 Other current financial assets (derivative instruments) 39,124 39,124 - - Derivative instruments in designated hedge accounting relationships 39,124 39,124 - - Unquoted shares 948,250 948,250 960,771 960,771 Available for sale investments 948,250 948,250 960,771 960,771 Current 293,193,603 293,193,603 305,466,375 305,466,375 Non-current 33,748,428 33,748,428 20,893,697 20,893,697 Total financial assets 326,942,031 326,942,031 326,360,072 326,360,072


12.31.2016 12.31.2015Carrying amount Fair value Carrying amount Fair value

ThCh$ ThCh$ ThCh$ ThCh$ Financial Liabilities

Current bank loans 77,049,846 77,049,846 8,222,616 8,222,616

Current lease liabilities 3,618,006 3,618,006 4,502,351 4,502,351

Current bonds liabilities 465,586 465,586 459,099 459,099

Trade and other current payables 2,136,857 2,136,857 123,799 123,799

Non-current bank loans 513,766 513,766 1,549,930 1,549,930

Non-current lease liabilities 6,098,498 6,098,498 1,899,445 1,899,445

Non-current bonds liabilities 76,042,582 82,788,619 75,150,906 79,552,965

Trade and other non-current payables 12,663 12,663 41,042 41,042

Amortized cost 165,937,804 172,683,841 91,949,188 96,351,247

Other finance liabilities (hedging instruments)- current 2,098,166 2,098,166 - -

Derivative instruments in designated hedge accounting relationships 2,098,166 2,098,166 - -

Trade and other current payables 112,219,229 112,219,229 119,702,755 119,702,755

Current accounts payable to related companies 731,595 731,595 5,207,492 5,207,492

Non-current accounts payable to related companies 64,822 64,822 71,970 71,970

Trade and other non-current payables 14,336,265 14,336,265 16,964,770 16,964,770

Trade and other payables 127,351,911 127,351,911 141,946,987 141,946,987

Current 198,319,285 198,319,285 138,218,112 138,218,112

Non-current 97,068,596 103,814,633 95,678,063 100,080,122

Total financial liabilities 295,387,881 302,133,918 233,896,175 238,298,234

Methodology and Assumptions Used in the Calculation of Fair Value

The fair value of financial assets and liabilities is calculated using the following methodology:

a) The fair value of financial assets and liabilities of short-term nature approximates their carrying amounts, such as in the case of trade and other current receivables, current accounts receivable from related companies, and trade and other current payables.

b) The carrying amount of “unlisted shares” approximates their fair value due to very low liquidity of those shares in the market.

c) The fair value of financial assets (debt securities, shares and money market funds) with standard terms and conditions which are traded in an active market has been determined based on market price references. To the extent that quoted market prices are available, SONDA will consider them as inputs to measure the fair value of its financial assets.

The valuation technique used incorporates all factors that market participants would consider to determine prices, minimize the use of unobservable inputs and be consistent with economic methodologies for the pricing of financial instruments.

d) The fair value of bonds (SONDA’s corporate bonds), is determined using interest market rates from specialized pricing service providers based on the latest quotation at measurement date.

e) The fair value of financial assets and liabilities not included in a) and b), except for derivative instruments, was determined by using cash flow analysis, applying the discount rate curves for the remaining period at the date of the termination of the right or obligation, as appropriate. This includes interest-bearing bank borrowings.

f) Foreign exchange forward contracts are measured at fair value. The fair value is determined using forward rates determined by independent pricing service providers, and applied to the remaining period until maturity of the instruments.


Fair Value Hierarchy

Fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:

• Level 1 - are quoted prices (unadjusted) in active markets for identical assets and liabilities.• Level 2 - inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly

(i.e. derived from prices).• Level 3 - inputs for the asset or liability that are not based on observable market data (unobservable inputs)

12.31.2016 Level 1 Level 2 Level 3 Total ThCh$ ThCh$ ThCh$ ThCh$

Financial assets classified as held for trading Mutual funds units 31,459,620 - - 31,459,620 Financial instruments at fair value - 2,104,940 - 2,104,940 Derechos por opcioón CALL - - 4,013,285 4,013,285 Assets and liabilities designated as hedge Hedging assets - 39,124 - 39,124 Hedging liabilities - (2,098,166) - (2,098,166) Financial assets classified as available for sale Investment in unlisted shares - - 948,250 948,250Total 31,459,620 45,898 4,961,535 36,467,053

For the option to purchase shares of ATIVAS S.A. Categorized in Level 3 of the hierarchy of measurement to fair value, the following information is relevant:

The Company used the Black & Scholes-Merton methodology. The formula calculates the value of the option based on premises and probabilities associated with the expectations of future revaluation of the shares, asset volatility, risk free rate, exercise price of the option and a series of other events.

Period for the exercise of options • The period of exercise of the purchase and sale option was established in the contracts for the purchase of ATIVAS, signed on October 19, 2016. • Probability occurrence of option exercise in the first period (at 4 years and 6 months) is 100%.

Risk-free rate • BM & F reference rates were used • DI curve for 5 and 9 years (1 and 2, respectively), to represent a compensation free of inflation effects, which makes returns similar to pre-established

risk-free financial instruments. • For each reference date, the DI curve of the moment is used, adjusting the discrete rate continuously.

Volatility • Considers the historical volatility of Sonda's shares as a comparable company, based on the closing price of Sonda (CI Equity Probe) traded on the

stock exchange. • Period considered for the calculation of volatility is equal to the term of the options granted (i.e., 4 years and 6 months from the grant date).

Assets reclassification: no reclassifications have been made in the periods informed.


Reconciliation of financial assets measured at fair value:

Financial assets classified as held for sale Level 2 Level 3 Total ThCh$ ThCh$ ThCh$

Reconciliation 2015

Balance at 01.01.2015 - 960,771 960,771

Total profit/loss

Recognised in profit or loss - - -

Recognised in other income - - -

Sales - - -

Trasfers to other levels - - -

Balance at 12.31.2015 - 960,771 960,771 Reconciliation 2016

Total profit/loss

Recognised in profit or loss - (12,521) (12,521)

Recognised in other income - - -

Sales - - -

Trasfers to other levels - - -

Balance at 12.31.2016 - 948,250 948,250

The fair value of level 3 has been determined by estimating the fair value of the assets and liabilities of the investee and an estimate of the realizable value of such investment.

32. FINANCIAL INFORMATION BY OPERATING SEGMENTS

The following analysis by business and geographical segment is required by IFRS 8 – Operating Segments to be disclosed by entities whose debt or equity instruments are traded in a public market or are in the process of issuing debt or equity instruments in a public market.

Business Segments

For managing purposes, the Company's business is focused on providing IT solutions, including a wide variety of IT services and products, through different regional business units that the Company has across Latin America and are part of its operating segments.

For each of these segments, there is financial information that is regularly reviewed by the senior management to make a decision about resources to be allocated to the segments and assess its performance. The segments that the Company uses to manage its operations are the following: • Chile • Brazil • Mexico • OPLA (other countries in Latin America - Argentina, Colombia, Costa Rica, Ecuador, Panama, Peru and Uruguay).

Also, as SONDA S.A. provides technology solutions to medium and large size companies and organizations, its supply covers the main business lines in the IT industry: IT Services, Software applications and Platforms.


IT Services: IT services create value by a better use of hardware, software and communication tools. This area provides a wide variety of services, including IT outsourcing, system projects and integration, infrastructure support, professional services, SONDA Utility, data center and BPO.

Software Applications: Our software application services are focused on supporting our clients` business processes by means of our own or third party software solutions. These solutions may be general purpose or specific for a particular industry. These services include implementation, technical support, functional support, maintenance and updating of versions, and outsourcing of related applications and/or services under a contract, as well as software development, if necessary.

Platforms: These services include supplying the components of the computer infrastructure: servers, workstations, PCs, printers, storage and backup equipment, communication equipment and base software (database, operating systems and others).

Profit or loss for each reportable segment

As the corporate structure in which the Company performs its operations divided in a geographical regional basis, the information by segments for the years ended December 31, 2016 and 2015 that is shown below is based on the financial statements of the subsidiaries that operate in these geographical regions.

12.31.2016 Chile Brazil México OPLA Total

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Gross operating profit

Total revenue 361,288,601 278,639,054 75,139,624 101,091,565 816,158,844

Platforms 209,054,677 37,442,973 37,406,970 34,605,884 318,510,504

IT Services 134,064,122 213,211,569 37,732,654 61,770,780 446,779,125

Software applications 18,169,802 27,984,512 - 4,714,901 50,869,215

Cost of sales (less) (276,074,914) (257,601,313) (57,396,035) (80,492,957) (671,565,219)

Total gross operating profit 85,213,687 21,037,741 17,743,589 20,598,608 144,593,625

Administrative expenses (38,259,633) (26,727,273) (6,737,918) (9,567,756) (81,292,580)

Operating profit 46,954,054 (5,689,532) 11,005,671 11,030,852 63,301,045

12.31.2015 Chile Brazil México OPLA Total

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Gross operating profit

Total revenue 353,142,573 343,879,479 82,457,444 111,642,941 891,122,437

Platforms 209,625,104 59,928,295 46,312,403 37,744,460 353,610,262

IT Services 127,395,404 250,152,155 36,145,041 68,218,096 481,910,696

Software applications 16,122,065 33,799,029 - 5,680,385 55,601,479

Cost of sales (less) (272,863,304) (304,266,424) (63,378,526) (87,840,872) (728,349,126)

Total gross operating profit 80,279,269 39,613,055 19,078,918 23,802,069 162,773,311

Administrative expenses (34,138,401) (18,835,720) (6,883,923) (9,767,501) (69,625,545)

Operating profit 46,140,868 20,777,335 12,194,995 14,034,568 93,147,766


Assets and Liabilities for each reportable segment

12.31.2016 Chile Brazil Mexico OPLA Total

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Total Assets 266,353,164 459,832,019 70,880,955 86,107,703 883,173,841

Current Assets 151,347,487 141,886,260 35,020,763 57,638,769 385,893,279

Non-current Assets 115,005,677 317,945,759 35,860,192 28,468,934 497,280,562

Total Liabilities 165,890,040 150,098,462 24,366,095 31,461,820 371,816,417 Current liabilities 81,654,620 109,023,208 21,239,754 29,481,935 241,399,517

Non-current liabilities 84,235,420 41,075,254 3,126,341 1,979,885 130,416,900

12.31.2015 Chile Brazil Mexico OPLA Total

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Total Assets 267,710,052 342,080,388 91,737,425 81,257,745 782,785,610

Current Assets 150,658,358 119,685,269 55,222,326 56,570,864 382,136,817

Non-current Assets 117,051,694 222,395,119 36,515,099 24,686,881 400,648,793

Total Liabilities 154,863,325 94,096,744 39,731,185 28,237,071 316,928,325 Current liabilities 71,213,425 65,481,405 36,666,898 26,008,214 199,369,942

Non-current liabilities 83,649,900 28,615,339 3,064,287 2,228,857 117,558,383

Cash flows for each reportable segment

12.31.2016 Chile Brazil OPLA Mexico Total

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Cash flows from operating activities 52,041,833 5,995,689 1,912,726 7,570,749 67,520,997

Cash flows from investing activities (18,882,697) (87,033,183) 2,214,527 (2,887) (103,704,240)

Cash flows from financing activities (34,885,531) 83,639,562 (4,367,121) (8,110,546) 36,276,364

Increase (decrease) in cash and cash equivalents before effect of exchange rate changes (1,726,395) 2,602,068 (239,868) (542,684) 93,121

Effect of exchange rate changes on cash and cash equivalents (155,621) (2,415,324) (707,514) (789,497) (4,067,956)

Increase (decrease) in cash and cash equivalents (1,882,016) 186,744 (947,382) (1,332,181) (3,974,835)

Cash and cash equivalents at beginning of period 39,320,382 5,049,889 12,202,763 11,819,140 68,392,174

Cash and cash equivalents at end of period 37,438,366 5,236,633 11,255,381 10,486,959 64,417,339

12.31.2015 Chile Brazil OPLA Mexico Total

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ Cash flows from operating activities 49,947,909 (7,417,433) 7,346,687 1,360,772 51,237,935

Cash flows from investing activities (16,771,276) (12,579,907) 3,592,230 (64,085) (25,823,038)

Cash flows from financing activities (20,957,932) 3,607,605 (6,797,061) (8,520,776) (32,668,164)

Increase (decrease) in cash and cash equivalents before effect of exchange rate changes 12,218,701 (16,389,735) 4,141,856 (7,224,089) (7,253,267)

Effect of exchange rate changes on cash and cash equivalents (701,835) (3,251,099) 823,927 184,334 (2,944,673)

Increase (decrease) in cash and cash equivalents 11,516,866 (19,640,834) 4,965,783 (7,039,755) (10,197,940)

Cash and cash equivalents at beginning of period 27,803,516 24,690,722 7,236,980 18,858,896 78,590,114

Cash and cash equivalents at end of period 39,320,382 5,049,888 12,202,763 11,819,141 68,392,174


Other Segment Information

There is no dependence on major clients and none of the clients represents 10% or more of the Company’s revenue.

33. CONTINGENCIES AND RESTRICTIONS

I. Litigation and Arbitrations

1. SONDA S.A.

There is a lawsuit filed by the Financial Administrator of Transantiago (AFT) against certain transport operators in which the Company has joined into proceedings as third party in compliance with its contractual obligations in that regard, in order to defend the interests of the AFT in relation with the allegations contained in the counterclaim concerning alleged failures in providing the outsourced services to SONDA S.A.

The parties have presented various suspensions of the procedure, and are currently coordinating the presentation of the withdrawals of demands.

2. Subsidiaries

2.1 Subsidiaries in Brazil

a) The subsidiaries SONDA Procwork Inf. Ltda. (“SONDA Procwork”) and SONDA do Brasil S.A. (“SONDA do Brasil”) are subject to several labor and tax litigation proceedings from periods prior to the acquisition of such subsidiaries. The most significant litigation proceedings are related to notifications of judicial decrees for tax infringement (tax assessment) imposed by the Municipalities of Sao Paulo and Campinas, based on the assumption that certain services of the subsidiary were provided in the district of their municipalities. The tax is applicable in Brazil on behalf of the municipalities where companies provide their services, calculated as a percentage of their billing. The subsidiary of SONDA S.A. alleged the nullity of the collections based on the assumption that such taxes were already paid in conformity with the territory distribution in accordance with the law.

The value of disputed with the Municipality of Campinas is R$ 30.5 million (including fines, indexation and interests). Local lawyers have informed the company that these territorial conflicts in the application of the tax are common in Brazil, and consider that there is a high likelihood of ultimately obtaining a favorable outcome for the company.

b) On December 14, 2012, the subsidiary SONDA Procwork in Brazil was notified of an infringement notice by the tax authority (Receita Federal) in the amount of R$ 26.1 million (including fines, indexation and interests) due to social security contributions calculated on certain benefits paid to employees (cota utilidade) in 2008. For the Receita Federal such benefits would be part of the salary.

The payment of these benefits is made by the company under the Collective Bargaining Agreement signed between the Workers Union of

IT and the Union of Companies of IT, and with the consent of the Ministry of Labor, which expressly states that such payments are not part of the salary for any purpose. As per the criteria of the Brazilian higher courts, such agreements must be respected by the parties and by the inspecting entities. According to the above, the Ministry of Labor has reviewed the payment process of the cota utilidade for the same period as the one established in the infringement notice of the Receita Federal, concluding it without any comments, coincidently with the approach of the judicial power in various labor lawsuits in which was ratified the nature of such benefits as not being part of the salary.

On January 14, 2013 the company has presented a challenge to the infringement notice to the court, and requested the suspension of its effects according to Brazilian law.

These discrepancies in interpretations between the Ministry of Labor and the Receita Revenue could eventually generate new infringement notices.

In the opinion of the lawyers of the subsidiary, there exist sufficient grounds to indicate that there is a high probability of success of the defense. However Management, understanding that there exist a difference of opinion between two state institutions such as the Ministry of Labur and the Receita Federal on which there is still no jurisprudence, has adopted a conservative approach and established a provision to cover any possibility of an adverse outcome (see Note 22)

c) CTIS: The company is involved in legal proceedings and administrative processes at various courts and government agencies, that have arisen in the normal course of operations, related to tax, labor and civil matters:

a. Labor lawsuits: Management, based on information from its legal advisors, the analysis of the legal claims pending, and based on past experience regarding the amounts claimed, has recorded sufficient provisions to cover the estimated losses fo the current lawsuits, classified with probable risk of loss.

There are judicial deposits, representing restricted assets of CTIS, deposited in courts that are determined as partial guarantee of the value until the resolution of the disputes.

b. Tax processes: It refers to use of tax credits challenged by the tax authority, arguing that retention of these in the source cannot be demonstrated. Management, because these processes are in the stage of testing and documentation by the inspecting entity, has recorded sufficient provisions to cover estimated losses in the ongoing processes, classified with probable risk of loss.

Procedures classified as possible risk total the amount of R$ 29.2 million.

All contingencies that are materialized, whose origin is prior to the acquisition date of CTIS, are covered by the escrow established.


d) ATIVAS: The Company is a party in legal actions filed with some courts of law and government entities which have arisen in the normal course of operations; these refer to tax matters, as well as labor and civil matters. In tax and civil matters, the company is the plaintiff; therefore these do not represent a contingency.

All contingencies which actually materialize, and whose date of origin is prior to the acquisition of ATIVAS, are the responsibility of the previous owners.

e) Some subsidiaries in Brazil, hire labor workers through individual companies for temporary services. However, due to the nature of the service, it could be considered a job with an employment relationship between the parties and as a consequence, companies may be fined by the tax authority, who may demand payment of social security contributions, plus taxes and the corresponding fines.

Our legal advisors estimate that it is not possible to assume an employment relationship with these service providers, and that there are elements to reduce the impacts of a possible notification by the tax authority (Receita Federal).

f) As of December 31, 2016, the current processes of labor nature have generated provisions to cover possible loss contingencies, amounting to ThCh$7,040,943 (ThCh$3,920,443 as of December 31, 2015). Presented in “other provisions”

In the opinion of management and its legal counsel, the provisions made are sufficient to cover the associated risks of these proceedings.

2.2 Chilean subsidiaries

The subsidiaries Quintec Distribución S.A. and Innovación y Tecnología Empresarial Item Ltda. are processing two out-of-court matters, specifically administrative in nature, before the National Customs Service, referring to the claim of charges of differences of customs duties. In the opinion of the advisors, it is estimated that the outcome of this contingency will be favorable for the companies.

2.3 Colombian subsidiaries

The subsidiary Quintec Colombia currently has lawsuits in which it is part, mainly due to taxes, related to periods prior to its acquisition by SONDA. The main lawsuit is related with the División de Impuestos y Aduanas Nacionales (DIAN) [Division of National Taxes and Customs]: on September 30, 2013, a lawsuit is filed against the resolution of official settlement in which is determined the payment of differences presented in the tax settlement for foreign and national purchases relating to Income and Complementary Tax of fiscal year 2008 in the amount of Col$5,120,923. The hearing and closing arguments have already been presented. In the opinion of management, there are enough arguments to defend the position of the company.

2.4 Argentinian subsidiaries

The subsidiaries Sonda Argentina S.A. and Quintec Argentina S.A. were sued in the labor courts by former employees. According to management and legal counsel, the provisions established are sufficient to cover the risks associated with those legal proceedings.

2.5 Panamanian subsidiaries On August 29, 2014, the subsidiary Sonda Panama was notified

of an administrative complaint filed by five individuals against the Transit Authority and Land Transport of Panama, in order to annul the Contract No. 35 "Contract for the Concession Service of the Financial Management of the System of Mass Mobilization of Passengers in the Metropolitan area of Panama (District of Panama and San Miguelito)". On September 2 and 5, 2014, respectively, the lawyers of Sonda in Panama filed an appeal against the decision that started the proceeding and responded the lawsuit filed. This lawsuit is currently in process, but in the opinion of local lawyers it is very unlikely that it will be accepted.

3. Other litigation

The Company is a defendant and a plaintiff in other litigation and legal actions as a result of the ordinary course of business. In the opinion of management, the final outcome of these proceedings will not have an adverse effect on the Company’s financial position, operating income or liquidity.

II. Agreements

SONDA S.A.

a) Administrador Financiero de Transantiago S.A. (AFT) and related third parties.

Apart from having a minority ownership of 9.5% in Administrador Financiero de Transantiago S.A. (AFT), which provides the Chilean Ministry of Transport and Telecommunications (MTT) with services to manage resources in the Public Transport System of Santiago (Transantiago), on September 20, 2005, SONDA signed an agreement with AFT to provide technology services related to the project (Technology Service Agreement). SONDA’s timely and complete rendering of services contracted has required that SONDA make certain investments for approximately US$108 million. The appropriate operation of the system requires a high level of joint coordination and effort between the parties, including the Chilean MTT, AFT transport service concession companies, Metro S.A. and SONDA. This has not always been accomplished to date. As a result, during the execution of the project, SONDA has negotiated with AFT two amendments in the Technology Service Agreement. In 2008, SONDA signed a transaction agreement with AFT to solve conflicts and prevent other possible conflicts at that date. After this, SONDA started four arbitration


proceedings against AFT. Two of them are being processed and the other two were terminated by means of a judgment that gives authority to a writ of execution. One of them was favorable for SONDA and the other one partially accepted SONDA’s claim. New actions might be filed in the future. A possible adverse result of these proceedings might have adverse effects on SONDA’s business and results of operations.

On December 14, 2012, was agreed between MTT, AFT, METRO, SONDA and the Transport Concessionaires, the terms and conditions of the new contractual arrangements defined by the authority for Transantiago. As a result, the AFT and SONDA terminated their IT contract, which generated for the Company a net credit to income of ThCh$1,827,000. Additionally, SONDA signed a contract with the MTT under which it is obliged to provide certain technology services to Transantiago and its transport providers and complementary services (Contract for the Rendering of Supplemental Services of Provision of Technological Services for the Public Transportation System of Santiago), and in parallel SONDA also signed a contract for the provision of technological equipment with each Transport Concessionaire and later with Metro S.A. (Each of these called Contract for the Rendering of Services and Technological Equipment). After completing the process of acknowledgment of such contracts through a publication of the respective extract in the Official Gazette and after making the agreed payments between AFT and SONDA in favor of the latter, have been presented waivers with respect to each of the existing arbitration claims between AFT and SONDA, which were considered by the arbitrator.

b) Financial Management Service Concession Agreement with the Government of Panama

On April 8, 2011, SONDA signed the Financial Management Service Concession Agreement for the Public Transport System in the Metropolitan Area of Panama (District of Panama and San Miguelito) with the Government of the Republic of Panama. This agreement includes the design, supply, construction, maintenance and equipping of the technology system required by the collection of the system passengers’ bus fares and its subsequent distribution to the respective transport operator for 10 years, starting from February 15, 2012. As compensation for these services, SONDA S.A. will receive a payment of US$180,600,000 and had to provide a performance bond for US$18,060,000 that should be in effect for the life of the agreement and one additional year.

This contract involves the provision and operation for ten years of the collection system on buses, the reload network, offices to the public and the central systems, including the collection, administration and custody of the proceeds from the sales and reloading of cards, the allocation of these funds among providers of transportation services and the provision of technology services. The starting date of operations was February 15, 2012.

SONDA, as Administrator of the resources of the System, incorporates in its financial statements the operations of this project, presenting the following net balances:

Accounts related to the agreement for the Public Transport System

12.31.2016 12.31.2015 ThCh$ ThCh$

Current assets

Funds from the System classified in "other current assets" 4,356,054 4,172,594

Current liabilities

Obligations related to transportation services 4,356,054 4,172,594

Funds held in current accounts can only be used in the execution of the service contract of financial administration.

The obligations correspond to the balances for distribution to the respective suppliers of transport services and the state of Panama.

III. Commitments

a) Commitments with Financial Institutions and Others:

The parent company maintains obligations to the public as indicated in Note 19 (4). These bond issue contracts impose on the Company limits on financial indicators and obligations of doing and not doing, normal for this type of financing. The Company periodically informs the representatives of bondholders, according to the agreed dates and the following terms:

i) Leverage Ratio

The ratio between current liabilities less cash and consolidated equity must be equal to or more than 1.3 times.

ii) Coverage of Financial Expenses

The ratio between EBITDA and net financial expenses must be greater than or equal to 2.5.

iii) Equity

The minimum level of equity must be UF 8,000,000.

iv) Prohibition to pledge assets

Prohibition to pledge, mortgage or other levies on assets for an amount at least equal to or greater than 1.25 times current unsecured liabilities.

v) Control over Significant Subsidiaries

Must maintain control over the subsidiary SONDA Procwork Inf. Ltda.


vi) Prohibition to sell assets. No more than 15% of the consolidated assets.

As of December 31, 2016 and 2015, the Company is in compliance with all financial covenants. The following table sets forth the ratios calculated based on the consolidated financial statements:

i)Index: Leverage 12.31.2016 12.31.2015The ratio between: i) liabilities less cash and cash equivalents and ii) equity shall not exceed 1.3 times

0.60 0.53

ThCh$ ThCh$Current liabilities 241,399,517 199,369,942

Non - current liabilities 130,416,900 117,558,383

Liabilities 371,816,417 316,928,325

Less:

Cash and cash equivalent 64,417,339 68,392,174

Divided by:

Total equity 511,357,424 465,857,285

ii)Index: Coverage of financial expenses 12.31.2016 12.31.2015The ratio between: i) EBITDA and ii) net financial expenses shall not be less than 2.5 times 14.34 30.33

ThCh$ ThCh$EBITDA (*) 95,527,421 125,345,903

(excluding projects amortization) + Depreciation expenses

Divides by:

Financial cost (from non financial activities) referring to the last four 11,968,565 8,419,941

Financial income referring to the last four consecutive quarters 5,305,266 4,286,715

Net financial cost 6,663,299 4,133,226

iii)Index: Minimum equity 12.31.2016 12.31.2015At all times maintaining a minimum consolidated equity UF 8.000.000 19,407,842 18,176,895

ThCh$ ThCh$ Total equity 511,357,424 465,857,285

UF value 26,347.98 25,629.09

iv)Index: Assets free of pledges 12.31.2016 12.31.2015Maintain assets free of any pledge, mortgage or other lien for an amount at least equal to 1.25 times the unsecured liabilities

2.43 2.50

ThCh$ ThCh$Total assets 883,173,841 782,785,610

Pledges or guaranteed assets (*) 4,351,748 7,403,827

Assets free of pledges 878,822,093 775,381,783

Divided by:

Liabilities 371,816,417 316,928,325

Secured liabilities (**) (9,716,504) (6,401,796)

Unsecured Liabilities 362,099,913 310,526,529

(*) Finance lease assets. Note 16 a)(**) Finance lease liabilities. Note 19 (3) Lease liabilities

v)Index: Control over significant subsidiaries 12.31.2016 12.31.2015Maintaining control the subsidiary Sonda Procwork Inf. Ltda. In compliance In compliance

vi) Index: Prohibition to sell assets 12.31.2016 12.31.2015Prohibition to transfer, either in a single sale, or a succession of sales within the period of one year, asset i) represent a percentage equal or greater than 15% of consolidated assets and ii) that without which the issuer's turnover can not continue or decrease substantially.

In compliance In compliance


IV. Guarantees

As of December 31, 2016 SONDA S.A. has submitted guarantees and sureties amounting to ThCh$205,429,301 (ThCh$201,088,374 as of December 31, 2015); and has received guarantees amounting to ThCh$5,403,501 (ThCh$6,046,290 as of December 31, 2015)

These guarantees relate to commitments set out in their contracts with customers and suppliers, to ensure proper rendering of services and compliance of conditions and terms.

34. SUBSIDIARIES

The following table sets forth summarized financial information about SONDA’s subsidiaries:

Company

31.12.2016

Country Functional currency

Type of financial statement

Current assets

Non-current assets

Current Liabilities

Non-current liabilities

Non-controlling

interests Revenues Profit or

Loss

Non-controlling interests in profit

or loss

ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

1 AUTENTIA S.A Chile Chilean peso Separate 1,245,398 157,900 1,061,702 - - 4,753,994 242,684 -2 CTIS TECNOLOGÍA S.A. Brazil Brazilian reais Separate 41,431,463 51,168,366 27,881,845 13,740,983 - 124,795,730 (290,242) -3 ELUCID SOLUTIONS S.A. Brazil Brazilian reais Separate 27,913,016 33,734,624 3,317,714 6,033,703 19 15,295,724 1,397,716 -4 FACTORING GENERAL S.A. Chile Chilean peso Separate 114,562 5,975 36,334 - - 154,635 9,766 -5 INMOBILIARIA SERVIBANCA S.A. Chile Chilean peso Separate 41,880 1,895,514 7,474 290,294 - 234,144 89,266 -6 MICROGEO S.A. Chile US Dollar Consolidated 9,252,235 2,797,548 4,657,796 12,662 - 17,005,695 871,383 -7 NOVIS S.A. Chile Chilean peso Separate 2,153,361 1,959,342 1,347,643 699,761 - 8,414,128 216,885 -8 ORDEN S.A. Chile Chilean peso Separate 1,374,207 - 281,823 - - 4,380,108 97,594 -9 PARS PRODUTOS PROCES. DE DATOS LTDA. Brazil Brazilian reais Separate 18,395,262 40,135,038 2,769,692 3,292,020 - 17,759,799 (2,051,497) -10 QUINTEC FILIALES OPERATIVAS S.A. Chile Chilean peso Consolidated 18,409,081 23,092,894 16,876,776 3,915,000 - - 4,342,796 -11 SERVIBANCA S.A. Chile Chilean peso Separate 2,485,193 376,131 631,940 - - 11,701,672 1,445,882 -12 SERVICIOS EDUCACIONALES SONDA S.A. Chile Chilean peso Separate 358,825 45,840 447,733 2,770 - 1,008,462 (24,360) -13 SOC. PROD. Y SERV. REDES MOVILES S.A. Chile Chilean peso Consolidated 263,396 147 89,937 1,153,363 (413,228) 411,738 (43,714) (34,209)14 SOLUCIONES EXPERTAS S.A. Chile Chilean peso Consolidated 1,630,055 103,413 739,485 - 34,448 3,765,916 451,630 11,63315 SONDA SERV PROFESIONALES S.A. Chile Chilean peso Separate 5,021,091 5,107,380 5,185,821 2,555,722 - 11,591,682 823,158 -

16 SONDA ARGENTINA S.A. Argentina Argentine peso Separate 7,925,874 5,453,996 4,596,444 14,795 - 21,151,428 436,151 -

17 SONDA DE COLOMBIA S.A. Colombia Colombian peso Separate 8,556,608 8,640,810 6,049,528 906,644 - 18,189,045 304,314 -

18 SONDA DEL PERU S.A. Perú Peruvian Sol Separate 14,575,941 6,805,688 11,008,114 130,595 - 18,853,397 1,988,622 -19 SONDA DO BRASIL S.A. Brasil Brazilian reais Separate 5,962,140 5,083,811 5,246,770 1,282,456 - 8,592,927 (5,376,655) -20 SONDA ECUADOR S.A. Ecuador US Dollar Separate 6,631,821 1,239,160 1,266,896 756,108 - 9,564,250 324,110 -21 SONDA INMOBILIARIA S.A. Chile Chilean peso Separate 95,683 18,086,406 252,995 7,903,572 - 2,735,542 1,593,704 -22 SONDA MEXICO S.A. DE C.V. Mexico US Dollar Consolidated 34,114,878 35,557,624 20,720,083 3,126,341 - 69,037,019 5,131,657 -23 SONDA PANAMA S.A. Panamá US Dollar Separate 1,988,449 134,916 2,021,842 - - 620,607 54,988 -24 SONDA PROCWORK INF. LTDA. Brazil Brazilian reais Consolidated 38,644,031 74,742,257 46,799,837 9,823,085 - 96,476,677 (6,103,917) -25 SONDA PROCWORK OUTSOURCING Chile Chilean peso Separate 33,805,901 53,768,848 46,598,915 13,224,033 - 2,364,989 (579,118) (236,628)26 SONDA SPA Costa Rica US Dollar Separate 3,822 8,594 7,365 - - - 415 -27 SONDA TECNOL. DE COSTA RICA S.A. Uruguay US Dollar Separate 4,980,041 2,374,326 1,119,564 47,400 - 9,256,275 761,097 -28 SONDA URUGUAY S.A. Chile US Dollar Separate 5,788,155 2,580,485 2,769,973 124,343 - 9,316,325 129,736 -29 TECNOGLOBAL S.A. Brazil Brazilian reais Separate 37,814,596 2,669,159 20,136,156 1,615,000 - 107,484,775 4,063,052 -

30 TELSINC COMERCIO DE EQUIPAMIENTO DE INF. LTDA. Brazil Brazilian reais Separate 7,234,530 10,342,710 10,462,443 128,309 - 6,361,821 (920,425) -

31 TELSINC PREST. DE SERV. PARA SIST. DE INF. LTDA Chile Chilean peso Separate 3,561,028 10,180,962 839,593 271,059 - 4,446,577 (2,628,061) -

32 TRANSACCIONES ELECTRONICAS DOS S.A. Chile Chilean peso Separate 6,366,887 586,759 2,939,730 106,913 1,593,478 11,855,266 2,445,231 1,154,665 33 TRANSACCIONES ELECTRONICAS S.A. Chile Chilean peso Separate 5,774,717 520,946 1,762,712 - 8,431 13,587,151 5,934,281 13,006


Company

12.31.2015

Country Functional currency

Type of financial statement

Current assets

Non-current assets

Current Liabilities

Non-current

liabilities

Non-controlling

interests Revenues Profit or

Loss

Non-controlling interests in profit

or loss ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

1 ARAUCANIA PARTICIPACOES LTDA. Brazil Brazilian reais Consolidated 59,092,937 79,321,287 42,253,077 15,141,919 - 158,519,961 4,407,478 -2 AUTENTIA S.A Chile Brazilian reais Separate 918,541 186,015 932,838 - - 1,232,767 228,784 -3 ELUCID SOLUTIONS S.A. Brazil Brazilian reais Separate 23,380,423 29,181,202 3,211,512 5,353,838 16 20,037,011 4,728,222 -4 FACTORING GENERAL S.A. Chile Chilean peso Separate 99,586 5,080 30,229 - - 162,922 10,329 -5 INMOBILIARIA SERVIBANCA S.A. Chile Chilean peso Separate 60,800 1,947,247 779 286,508 - 222,167 144,923 -6 MICROGEO S.A. Chile Chilean peso Separate 8,945,373 2,737,619 4,412,393 47,216 - 18,485,400 598,528 -7 NOVIS S.A. Chile Chilean peso Separate 1,919,810 1,836,908 1,037,726 752,570 - 7,322,938 196,680 -8 ORDEN S.A. Chile Chilean peso Separate 1,484,190 4,574 493,974 - - 4,973,103 180,208 -9 PARS PRODUTOS PROCES. DE DATOS LTDA. Brazil Brazilian reais Separate 11,292,913 27,786,327 1,436,287 3,549,051 - 25,544,828 1,543,213 -10 QUINTEC FILIALES OPERATIVAS S.A. Chile Chilean peso Consolidated 38,658,221 7,281,904 17,579,117 8,195,003 347,174 99,338,474 6,613,375 6,14511 SERVIBANCA S.A. Chile Chilean peso Separate 2,358,413 545,410 579,521 - - 10,575,769 997,066 -12 SERVICIOS EDUCACIONALES SONDA S.A. Chile Chilean peso Separate 357,545 22,039 390,838 4,511 - 870,700 (85,807) -13 SOC. PROD. Y SERV. REDES MOVILES S.A. Chile Chilean peso Consolidated 277,496 98,871 84,040 1,228,370 (379,019) 330,908 (52,517) (37,121)14 SOLUCIONES EXPERTAS S.A. Chile Chilean peso Consolidated 1,991,352 100,999 849,767 - 22,890 3,294,359 430,253 7,79315 SONDA SERV PROFESIONALES S.A. Chile Chilean peso Separate 3,477,295 4,643,645 3,915,060 2,557,160 - 7,628,486 (764,554) -

16 SONDA ARGENTINA S.A. Argentina Argentine peso Separate 9,792,379 5,636,689 5,133,018 66,070 - 30,797,299 1,580,757 (9,020)

17 SONDA DE COLOMBIA S.A. Colombia Colombian peso Separate 8,065,310 7,754,781 4,878,997 1,004,169 - 18,623,239 (746,469) -

18 SONDA DEL PERU S.A. Perú Peruvian Sol Separate 11,294,760 3,873,698 6,235,829 324,940 - 18,903,869 2,527,446 -19 SONDA DO BRASIL S.A. Brazil Brazilian reais Separate 5,850,504 8,070,455 3,771,915 1,367,122 - 11,194,018 72,032 -20 SONDA ECUADOR S.A. Ecuador US Dollar Separate 7,309,285 1,330,075 977,720 691,525 - 10,250,923 469,755 -21 SONDA INMOBILIARIA S.A. Chile Chilean peso Consolidated 472,792 18,375,570 702,082 9,714,462 - 2,633,522 2,831,055 -22 SONDA MEXICO S.A. DE C.V. Mexico US Dollar Separate 55,222,327 36,515,099 36,666,898 3,064,287 642,832 82,457,444 7,021,958 269,61823 SONDA PANAMA S.A. Panamá US Dollar Separate 1,785,908 1,893,077 3,633,005 - - 854,449 76,894 -24 SONDA PROCWORK INF. LTDA. Brazil Brazilian reais Consolidated 29,838,125 60,318,748 33,228,177 3,033,927 - 102,312,041 (6,177,672) -25 SONDA SPA Chile Chilean peso Separate 3,411 7,375 6,149 - - - (364) -26 SONDA TECNOL. DE COSTA RICA S.A. CostaRica US Dollar Separate 4,743,549 2,140,806 1,082,849 39,574 - 8,518,158 534,008 -27 SONDA URUGUAY S.A. Uruguay US Dollar Separate 6,379,678 2,803,928 2,696,976 102,578 - 10,851,304 498,518 -28 TECNOGLOBAL S.A. Chile US Dollar Separate 39,027,557 2,830,159 22,518,739 1,615,000 - 112,346,207 1,683,682 -

29 TELSINC COMERCIO DE EQUIPAMIENTO DE INF. LTDA. Brazil Brazilian reais Separate 11,338,392 8,266,304 12,503,394 155,722 - 15,431,592 (549,060) -

30 TELSINC PREST. DE SERV. PARA SIST. DE INF. LTDA Brazil Brazilian reais Separate 5,606,923 9,450,796 1,763,648 13,262 - 8,022,369 1,327,203 -

31 TRANSACCIONES ELECTRONICAS DOS S.A. Chile Chilean peso Separate 3,556,525 669,044 1,429,446 116,623 1,260,720 7,896,974 1,747,895 827,74232 TRANSACCIONES ELECTRONICAS S.A. Chile Chilean peso Separate 3,683,605 1,610,925 1,463,075 1,024,720 5,118 11,207,959 5,209,638 11,266

SONDA's ownership interest in its subsidiaries consists of:

• SONDA Filiales Chile Ltda. includes all the subsidiaries in Chile. • SONDA Filiales Brazil S.A. includes all the subsidiaries in Brazil. • SONDA México S.A. includes all the subsidiaries in Mexico. • SONDA Regional S.A. includes all the subsidiaries in the rest of Latin American countries (Argentina, Colombia, Costa Rica, Ecuador, Peru, Uruguay

and Panama)

35. ENVIRONMENT

The activities of the Company and its subsidiaries do not affect the environment; therefore, at the end of each reporting period the Company has not committed resources, or made payments for non-compliance of municipal ordinances or payments to other regulatory agencies.


36. RISK ANALYSIS

SONDA’s risk management strategy is focused on the effects of the following risks:

• Market Risk - Exchange rate - Interest rate • Credit Risk • Liquidity or Funding Risk

The events or effects of Financial Risk refer to situations in which the Company is exposed to uncertainty.

The financial risk management structure includes the identification, determination, analysis, quantification, measurement and control over these events. The management, and particularly the Corporate Finance Management and General Management are responsible for the constant evaluation and management of financial risk.

Market Risk

Market Risk is the risk related to uncertainties associated with variables in exchange rates and interest rates affecting the Company’s assets and liabilities.

a) Exchange Rate Risk

SONDA S.A. has defined the Chilean peso as its functional currency, as its income, costs, investments and debts are denominated mainly in Chilean pesos.

The Company is exposed to exchange rate risks mainly due to its ownership of foreign subsidiaries. Thus exposing it to the volatility of the US dollar, Colombian peso, new Peruvian sol, Argentinean peso and Mexican peso. The adjustments due to changes in these currencies mainly affect the shareholders’ equity of SONDA S.A.

Additionally, the Company is exposed to volatilities as a result of balances in checking accounts and investments in foreign currencies, mainly the euro and Brazilian real and the aforementioned currencies, where the related changes affect the Company’s income statement.

Upon evaluation by the Corporate Finance Management, SONDA S.A. could enter into derivative instruments to manage its exposure to the exchange rate risk. The Company carries out transactions in currencies other than the Chilean peso in assets related to projects.

As a result, as of December 31, 2016, the Company had at the consolidation level a net exposure of ThCh$459,150 million as a result of its investments in related companies and ThCh$18,130 million (net assets) related to balances in checking accounts and investments. Taking into consideration this exposure, the Company considered a simultaneous devaluation of

1.8% of the US dollar, 5.7% of the Brazilian reais, 2.8% of the Colombian peso, 2.4% of the new Peruvian sol, 2.8% of the Mexican peso, 16.1% of the Argentinean peso and 2.4% of the Euro with respect to the Chilean peso, with the rest of variables unchanged. This would result in a loss of ThCh$23,573 million with an effect on equity and Ch$324 million with an effect on income.

The percentage of devaluation of the currencies was calculated by applying a maximum change with respect to the Chilean peso, considering the last five years (from January 2011 to December 2016).

These are the details of the impacts by currency as a result of the depreciation considered by the analysis:

Foreign currency exposure (in millions of Ch$)

U.S. dollar

Brazilian reais

Colombian Pesos

Peruvian Sol

Mexican Pesos

Argentine Pesos Euro TOTAL

Effect in Equity (1,098) (20,793) (116) (229) (377) (960) - (23,573)

Foreign currency exposure (in millions of Ch$)

U.S. dollar

Brazilian reais

Colombian Pesos

Peruvian Sol

Mexican Pesos

Argentine Pesos Euro TOTAL

Effect in Profit/Loss 324 - - - - - - 324

SONDA has taken financial operations (derivatives) whose purpose is to cover the volatility of the exchange rate of the account payable expressed in foreign currency (dollar), as reported in Note 20.

b) Interest Rate Risk Management

SONDA S.A. has liabilities with financial institutions at fixed interest rates. From the point of view of assets, the financial investments made by SONDA S.A. are intended to maintain an appropriate level of surplus to meet short-term cash needs.

Considering the financial instruments that are liabilities included in the portfolio, this risk is not considered as significant.

As of December 31, 2016, debt to financial institutions amounted to ThCh$ 87,280,116 and to the public at ThCh$ 76,508,168 (ThCh$ 16,174,342 and ThCh$ 75,610,005, respectively, as of December 31, 2015).

Financial investments are exposed to interest rate risks due to the adjustments in the market value of the portfolio. Debentures have no significant exposure to this risk as SONDA mainly manages its funding with medium and long-term fixed interest rates.

As of December 31, 2016, short-term investments in financial entities amounted to ThCh$ 37,439,930 (ThCh$ 42,948,393 at December 31, 2015).


Credit Risk Management

The credit risk refers to the risk that one of the parties does not comply with its contractual obligations. This results in a financial loss for SONDA S.A. and subsidiaries, mainly in their trade receivables, financial assets and derivatives.

For its trade receivables, the Company has defined policies that allow the Company to control the risk of loss from collection and default. It should also be noted that SONDA S.A. has a client base of more than 5,000 clients at the regional level, including leading companies in Latin America in a wide range of industries and markets. This along with sector and regional diversification allow the Company to reduce the volatility of this risk substantially. Therefore, its operations do not depend only on a particular client or group. This minimizes risks in the event of a crisis that may affect a particular client or business area.

In regard to the risk of its portfolio of investments and its derivative instruments, it is limited as the counterparts are banks with high credit rates determined by risk rating agencies.

The carrying amount of financial assets recognized in the financial statements represents the maximum exposure to credit risk, regardless of the guarantees of the accounts or other credit enhancements.

Financial assets and other credit exposures

Maximum exposure

12.31.2016

Maximum exposure

12.31.2015 ThCh$ ThCh$

Time deposits 5,980,311 7,634,998

Money market funds 31,459,620 35,313,395

Financial instruments at fair value 2,104,940 330,797

Other receivables - current 23,571,070 -

Trade and other receivables 223,096,371 248,824,973

Accounts receivable from related companies (1) 7,376,559 6,461,856

Other receivables - non current 16,204,545 -

Call option rights 4,013,285 -

Investment in AFT (2) 924,992 924,992

SONDA S.A. does not hold any collateral for these assets.

(1) It includes ThCh$2,418,540 as of December 31, 2016 (ThCh$2,319,432 as of December 31, 2015) of balances receivable from Administrador Financiero Transantiago S.A.

(2) Corresponds to the investment in Administrador Financiero Transantiago S.A.

Liquidity or Funding Risk Management

The liquidity risk is related to funding needs for payment obligations. The objective of SONDA S.A. is to keep balance between continuity of funding and financial flexibility through regular operating cash flows, bank loans, public bonds, short-term investments and lines of credit.

At December 31, 2016 and 2015, SONDA S.A. has a balance of cash and cash equivalents of ThCh$64,417,339 and ThCh$68,392,174, respectively. This balance includes cash, bank balances, time deposits for less than 90 days, and fixed income mutual funds.

Also, SONDA S.A. has structured its financial obligations at fixed rates. This reduces the volatility of its future cash flows, and allows the Company to be managed based on accurate information about its future obligations.

37. FOREIGN CURRENCY

The details of assets and liabilities in foreign currency are as follows:

CURRENT ASSETS Currency12.31.2016 12.31.2015

Amount Amount ThCh$ ThCh$

Cash and cash equivalents

U.F. - - Chilean peso 34,042,094 37,492,869 U.S. dollar 19,320,768 18,606,961 Euro 857 941 Yen - - Brazilian Reais 5,065,348 4,839,588 Colombian peso 671,127 362,684 Peruvian sol 255,785 196,376 Mexican peso 3,472,161 5,451,310 Other currencies 1,589,199 1,441,445

Other current financial assets

U.F. - - Chilean peso 942,724 1,012,143 U.S. dollar 648,457 694,114 Euro - - Yen - - Brazilian Reais 25,483,894 13,991 Colombian peso - - Peruvian sol - - Mexican peso 14,929 - Other currencies 175 -

Other current non-financial assets

U.F. 14,335 12,917 Chilean peso 2,554,698 2,052,770 U.S. dollar 4,978,274 2,743,370 Euro - - Yen - - Brazilian Reais 5,671,267 4,586,545 Colombian peso 535,388 570,838 Peruvian sol 197,916 89,958 Mexican peso 815,580 3,476,568 Other currencies 416,919 779,315

Trade and other current receivables

U.F. 4,247,233 9,174,918 Chilean peso 63,818,795 57,263,766 U.S. dollar 28,235,837 40,192,896 Euro - - Yen - - Brazilian Reais 78,389,291 94,998,542 Colombian peso 6,109,655 5,585,458 Peruvian sol 886,496 745,258 Mexican peso 11,294,225 15,891,101 Other currencies 5,659,305 8,412,475


CURRENT ASSETS (continued) Currency12.31.2016 12.31.2015


Current accounts receivable from related companies

U.F. - - Chilean peso 2,936,881 2,826,382 U.S. dollar - - Euro - - Yen - - Brazilian Reais 108,367 263,157 Colombian peso - - Peruvian sol - - Mexican peso - - Other currencies - -

Inventories

U.F. - - Chilean peso 10,478,324 15,099,721 U.S. dollar 21,188,543 16,667,756 Euro - - Yen - - Brazilian Reais 2,012,327 3,186,199 Colombian peso 400,129 85,320 Peruvian sol 5,249,413 556,536 Mexican peso - 5,460,643 Other currencies 869,739 1,424,560

Current tax assets

U.F. - 2,055,080 Chilean peso 6,551,131 2,183,620 U.S. dollar 1,450,056 1,730,435 Euro - - Yen - - Brazilian Reais 24,191,077 11,394,547 Colombian peso 1,066,732 1,565,021 Peruvian sol 1,142,052 277,579 Mexican peso 1,479,035 - Other currencies 1,436,741 671,144

Subtotal Current Assets

U.F. 4,261,568 11,242,915 Chilean peso 121,324,647 117,931,271 U.S. dollar 75,821,935 80,635,532 Euro 857 941 Yen - - Brazilian Reais 140,921,571 119,282,569 Colombian peso 8,783,031 8,169,321 Peruvian sol 7,731,662 1,865,707 Mexican peso 17,075,930 30,279,622 Other currencies 9,972,078 12,728,939

TOTAL CURRENT ASSETS

U.F. 4,261,568 11,242,915 Chilean peso 121,324,647 117,931,271 U.S. dollar 75,821,935 80,635,532 Euro 857 941 Yen - - Brazilian Reais 140,921,571 119,282,569 Colombian peso 8,783,031 8,169,321 Peruvian sol 7,731,662 1,865,707 Mexican peso 17,075,930 30,279,622 Other currencies 9,972,078 12,728,939

385,893,279 382,136,817

NON-CURRENT ASSETS Currency12.31.2016 12.31.2015


Other non-current financial assets

U.F. - - Chilean peso 948,298 960,821 U.S. dollar - - Euro - - Yen - - Brazilian Reais 7,321,443 1,945,854 Colombian peso - - Peruvian sol - - Mexican peso - - Other currencies - -

Other non-corrent non-financial assets

U.F. 95,098 96,595 Chilean peso 313,451 472,796 U.S. dollar 1,994,181 1,434,599 Euro - - Yen - - Brazilian Reais 14,852,449 5,803,888 Colombian peso 59,071 41,773 Peruvian sol 22,142 2,294 Mexican peso 139,378 739,543 Other currencies 328,464 58,859

Non-current receivables

U.F. 4,004,348 352,988 Chilean peso 492,288 3,964,985 U.S. dollar 11,912,045 8,812,991 Euro - - Yen - - Brazilian Reais 5,420,592 2,405,550 Colombian peso - - Peruvian sol - - Mexican peso 2,626,261 1,024,045 Other currencies - -

Non-current accounts receivable from related companies

U.F. - - Chilean peso 1,880,001 1,773,880 U.S. dollar - - Euro - - Yen - - Brazilian Reais 2,451,310 1,598,437 Colombian peso - - Peruvian sol - - Mexican peso - - Other currencies - -

Investments accounted for using the equity method

U.F. - - Chilean peso 5,738,380 5,718,720 U.S. dollar - - Euro - - Yen - - Brazilian Reais - - Colombian peso - - Peruvian sol - - Mexican peso - - Other currencies - -


NON-CURRENT ASSETS (continued) Currency

12.31.2016 12.31.2015 Amount Amount ThCh$ ThCh$

Intangible assets other than goodwill

U.F. - - Chilean peso 4,612,662 6,849,048 U.S. dollar 2,010,157 1,785,951 Euro - - Yen - - Brazilian Reais 24,710,741 18,259,397 Colombian peso - 44,745 Peruvian sol 125,151 9,064 Mexican peso 524,316 - Other currencies - -

Goodwill

U.F. - - Chilean peso 24,249,877 23,935,090 U.S. dollar 29,289,661 24,364,797 Euro - - Yen - - Brazilian Reais 182,951,297 155,564,958 Colombian peso 4,856,648 6,700,548 Peruvian sol 58,324 60,825 Mexican peso - 6,388,291 Other currencies 1,367,527 1,721,028

Property, plant and equipment

U.F. 1,582,131 - Chilean peso 53,796,837 52,759,410 U.S. dollar 8,466,653 7,539,310 Euro - - Yen - - Brazilian Reais 62,447,912 26,216,368 Colombian peso 3,909,395 2,996,314 Peruvian sol 2,387,044 2,348,068 Mexican peso - 2,563,871 Other currencies 757,157 1,009,781

Investment property

U.F. - - Chilean peso 2,349,084 2,366,840 U.S. dollar - - Euro - - Yen - - Brazilian Reais - - Colombian peso - - Peruvian sol - - Mexican peso - - Other currencies - -

Deferred tax assets

U.F. - - Chilean peso 1,623,246 2,034,750 U.S. dollar 615,278 413,076 Euro - - Yen - - Brazilian Reais 21,296,666 13,638,615 Colombian peso - - Peruvian sol 273,928 185,911 Mexican peso 2,379,847 3,643,345 Other currencies 39,823 40,774

NON-CURRENT ASSETS (continued) Currency

12.31.2016 12.31.2015 Amount Amount ThCh$ ThCh$

TOTAL NON-CURRENT ASSETS

U.F. - - Chilean peso - - U.S. dollar - - Euro - - Yen - - Brazilian Reais - - Colombian peso - - Peruvian sol - - Mexican peso - - Other currencies - -

NON-CURRENT ASSETS Currency 12.31.2016 12.31.2015


TOTAL NON-CURRENT ASSETS

U.F. 5,681,577 449,583

Chilean peso 96,004,124 100,836,340

U.S. dollar 54,287,975 44,350,724

Euro - -

Yen - -

Brazilian Reais 321,452,410 225,433,067

Colombian peso 8,825,114 9,783,380

Peruvian sol 2,866,589 2,606,162

Mexican peso 5,669,802 14,359,095


497,280,562 400,648,793

TOTAL ASSETS

U.F. 9,943,145 11,692,498

Chilean peso 217,328,771 218,767,611

U.S. dollar 130,109,910 124,986,256

Euro 857 941

Yen - -

Brazilian Reais 462,373,981 344,715,636

Colombian peso 17,608,145 17,952,701

Peruvian sol 10,598,251 4,471,869

Mexican peso 22,745,732 44,638,717


883,173,841 782,785,610


CURRENT LIABILITIES Currency

12.31.2016 12.31.2015Maturity Maturity

Up to 90 days

90 days to 1 year

Up to 90 days

90 days to 1 year

Amount Amount Amount Amount ThCh$ ThCh$ ThCh$ ThCh$

Other current financial liabilities

U.F. 346,024 453,195 764,376 334,873 Chilean peso 24,372,031 - 339,797 - U.S. dollar 1,001,932 40,319,426 765,890 - Euro - - - - Yen - - - - Brazilian Reais 13,301,847 1,830,994 5,964,669 3,110,634 Colombian peso 120,571 1,524,275 173,537 1,644,462 Peruvian sol - - - - Mexican peso - - - - Other currencies - - 209,627 -

Trade and other payables

U.F. 23,450 - 105,220 - Chilean peso 34,168,044 - 39,166,509 - U.S. dollar 36,191,580 134,098 17,948,141 476,000 Euro - - 403,425 - Yen - - - - Brazilian Reais 30,672,154 1,358,973 27,599,472 5,731,864 Colombian peso 2,722,990 - 1,551,904 - Peruvian sol 467,441 - 336,026 - Mexican peso 3,893,550 - 23,526,961 - Other currencies 2,586,949 - 2,857,233 -

Accounts payable to related companies

U.F. - - - - Chilean peso 727,235 - 5,202,165 - U.S. dollar 4,360 - 5,327 - Euro - - - - Yen - - - - Brazilian Reais - - - - Colombian peso - - - - Peruvian sol - - - - Mexican peso - - - - Other currencies - - - -

Other short-term provisions

U.F. - - - - Chilean peso - - - - U.S. dollar 367,231 - 62,592 44,244 Euro - - - - Yen - - - - Brazilian Reais 7,577,896 937,725 6,575,077 - Colombian peso 78,100 - 64,826 - Peruvian sol - - - - Mexican peso 151,261 - 118,755 - Other currencies 410,977 - 329,947 -

Current tax liabilities

U.F. - - 166,936 - Chilean peso 2,972,761 - 13,389,892 - U.S. dollar 270,220 - 74,963 27,878 Euro - - - - Yen - - - - Brazilian Reais 3,267,333 - 3,236,924 - Colombian peso 188,683 - 36,565 - Peruvian sol - - 608,729 - Mexican peso 1,869,250 - 4,342,247 -

CURRENT LIABILITIES Currency

12.31.2016 12.31.2015Maturity Maturity

Up to 90 days

90 days to 1 year

Up to 90 days

90 days to 1 year

Amount Amount Amount Amount ThCh$ ThCh$ ThCh$ ThCh$

Current tax liabilities Other currencies 19,998 - 202,651 -

Current provisions for employee benefits

U.F. - - - - Chilean peso 2,413,135 - 2,332,168 - U.S. dollar 83,001 - - 125,804 Euro - - - - Yen - - - - Brazilian Reais 1,061,103 - 1,504,427 - Colombian peso - - - - Peruvian sol 496,029 - 479,762 - Mexican peso 1,002,693 - 1,232,559 - Other currencies 326,805 17,215 254,358 10,604

Other current non-financial liabilities

U.F. - - - - Chilean peso 5,023,470 - 6,226,609 - U.S. dollar 4,996,675 10,037 2,180,086 10,976 Euro - - - - Yen - - - - Brazilian Reais 7,568,623 123,492 9,581,670 106,986 Colombian peso 1,116,667 - 1,010,489 - Peruvian sol 42,388 - - - Mexican peso 1,788,634 - 5,471,734 - Other currencies 996,996 - 1,329,720 11,652

Subtotal Current Liabilities

U.F. 369,474 453,195 1,036,532 334,873 Chilean peso 69,676,676 - 66,657,140 - U.S. dollar 42,914,999 40,463,561 21,036,999 684,902 Euro - - 403,425 - Yen - - - - Brazilian Reais 63,448,956 4,251,184 54,462,239 8,949,484 Colombian peso 4,227,011 1,524,275 2,837,321 1,644,462 Peruvian sol 1,005,858 - 1,424,517 - Mexican peso 8,705,388 - 34,692,256 - Other currencies 4,341,725 17,215 5,183,536 22,256

TOTAL CURRENT LIABILITIES

U.F. 369,474 453,195 1,036,532 334,873 Chilean peso 69,676,676 - 66,657,140 - U.S. dollar 42,914,999 40,463,561 21,036,999 684,902 Euro - - 403,425 - Yen - - - - Brazilian Reais 63,448,956 4,251,184 54,462,239 8,949,484 Colombian peso 4,227,011 1,524,275 2,837,321 1,644,462 Peruvian sol 1,005,858 - 1,424,517 - Mexican peso 8,705,388 - 34,692,256 - Other currencies 4,341,725 17,215 5,183,536 22,256

194,690,087 46,709,430 187,733,965 11,635,977


NON-CURRENT LIABILITIES Currency

12.31.2016 12.31.2015 Maturity Maturity

1 to 3 years 3 to five

years 5 to 10 years

More than 10 years 1 to 3 years

3 to five years

5 to 10 years

More than 10 years

Amount Amount Amount Amount Amount Amount Amount Amount ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Other non-current financial liabilities

U.F. 699,762 - 39,171,740 - 755,523 - 38,078,472 -

Chilean peso - 36,870,842 - - - 37,072,434 - -

U.S. dollar 143,257 - - - 730,482 - - -

Euro - - - - - - - -

Yen - - - - - - - -

Brazilian Reais 4,169,756 1,184,051 - - 1,420,805 - - -

Colombian peso 403,984 24,117 - - 550,189 33,418 - -

Peruvian sol - - - - - - - -

Mexican peso - - - - - - - -

Other currencies - - - - - - - -

Non-current trade payables

U.F. - - - - - - - -

Chilean peso 527,580 - - - - - - -

U.S. dollar 79,667 - - - 742,510 - - -

Euro - - - - - - - -

Yen - - - - - - - -

Brazilian Reais 11,262,693 1,225,573 1,240,752 - 13,450,499 1,073,385 1,578,162 38,871

Colombian peso - - - - - - - -

Peruvian sol - - - - - - - -

Mexican peso - - - - - - - -

Other currencies - - - - 81,343 - - -

Non-current accounts payable to related companies

U.F. - - - - - - - -

Chilean peso 15,673 - - - 29,390 - - -

U.S. dollar - - - - - - - -

Euro - - - - - - - -

Yen - - - - - - - -

Brazilian Reais 49,149 - - - 42,580 - - -


Peruvian sol - - - - - - - -

Mexican peso - - - - - - - -


Other long-term provisions

U.F. - - - - - - - -

Chilean peso - - - - - - - -

U.S. dollar - - - - 53,981 - - -

Euro - - - - - - - -

Yen - - - - - - - -

Brazilian Reais 4,420,779 - - - 2,458,649 - - -


Peruvian sol - - - - - - - -

Mexican peso - - - - - - - -


Deferred tax liabilities U.F. - - - - - - - -

Chilean peso 4,873,179 - - - 5,015,017 - - -


NON-CURRENT LIABILITIES Currency

12.31.2016 12.31.2015 Maturity Maturity

1 to 3 years 3 to five

years 5 to 10 years

More than 10 years 1 to 3 years

3 to five years

5 to 10 years

More than 10 years

Amount Amount Amount Amount Amount Amount Amount Amount ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$

Deferred tax liabilities

U.S. dollar - - - - - - - -

Euro - - - - - - - -

Yen - - - - - - - -

Brazilian Reais 12,143,607 1,584,194 623,049 - 2,086,206 1,508,537 3,861,301 322,759

Colombian peso 478,543 - - - 420,562 - - -

Peruvian sol - - - - - - - -

Mexican peso - - - - - - - -

Other currencies 44,676 - - - 36,116 - - -

Non-current provisions for employee benefits

U.F. - - - - - - - -

Chilean peso 1,957,566 - - - 479,293 - - 1,320,096

U.S. dollar 335,026 44,908 119,701 256,473 160,919 151,003 81,640 243,982

Euro - - - - - - - -

Yen - - - - - - - -

Brazilian Reais - - - - - - - -


Peruvian sol - - - - - - - -

Mexican peso 627,922 - - - 808,751 - - -

Other currencies 47,400 - - - 39,574 - - -

Other non-current non-financial liabilities

U.F. - - - - - - - -

Chilean peso 106,912 - - - 116,624 - - -

U.S. dollar 2,498,419 - - - 592,031 - - -

Euro - - - - - - - -

Yen - - - - - - - -

Brazilian Reais 3,171,155 - - - 773,085 - - -


Peruvian sol - - - - - - - -

Mexican peso - - - - 1,299,005 - - -

Other currencies 14,795 - - - 38,392 12,797 - -

Subtotal Non-current liabilities

U.F. 699,762 - 39,171,740 - 755,523 - 38,078,472 -

Chilean peso 7,480,910 36,870,842 - - 5,640,324 37,072,434 - 1,320,096

U.S. dollar 3,056,369 44,908 119,701 256,473 2,279,923 151,003 81,640 243,982

Euro - - - - - - - -

Yen - - - - - - - -

Brazilian Reais 35,217,139 3,993,818 1,863,801 - 20,231,824 2,581,922 5,439,463 361,630

Colombian peso 882,527 24,117 - - 970,751 33,418 - -

Peruvian sol - - - - - - - -

Mexican peso 627,922 - - - 2,107,756 - - -

Other currencies 106,871 - - - 195,425 12,797 - -

TOTAL NON-CURRENT LIABILITIES 48,071,500 40,933,685 41,155,242 256,473 32,181,526 39,851,574 43,599,575 1,925,708


38. AUDITOR FEES (UNAUDITED)

12.31.2016 12.31.2015 ThCh$ ThCh$

Auditor fees - Audit services 905,422 939,015

Auditor fees - other services 79,521 621

Total auditor fees (*) 984,943 939,636

(*) It includes the services hired by Sonda and its subsidiaries, and therefore correspond to auditors hired in Chile and abroad. The details are as follows:

12.31.2016 12.31.2015 ThCh$ ThCh$

Parent Company 168,331 172,149

Chilean subsidiaries 196,800 252,586

Foreign subsidiaries 619,812 514,901

Total 984,943 939,636

39. SUBSEQUENT EVENTS

Between January 1, 2017 and the date of these consolidated financial statements there have been no subsequent events that could significantly affect the financial position and/or consolidated income of the Company and its subsidiaries as of December 31, 2016.


consolidated financial statements - sonda€¦ · for the years ended december 31, 2016 and 2015...

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