Desarrolladora Homex (HXM)

m) Employee retirement obligations

The Company grants seniority premiums and termination pay, covering all its employees. The related calculations are based on the provisions of the Mexican Federal Labor Law (FLL).  Under FLL, workers are entitled to certain benefits at the time of their separation from the Company under certain circumstances.  Seniority premiums and termination payments are recognized periodically using the projected unit-credit method and financial assumptions (2007 and 2006 net of inflation).

As disclosed in Note 13, effective January 1 2008 the Company adopted MFRS D-3. As a result of this adoption, the transition liability of labor obligations is now being amortized over a four-year period. Prior to 2008, this liability was amortized on a straight-line basis over the labor life of our covered employees.

m) Employee retirement obligations

The Company’s policy is to grant seniority premiums and termination pay, covering all its employees. The related calculations are based on the provisions of the Mexican Federal Labor Law.

Seniority premiums and termination payments are recognized periodically based on independent actuarial computations, using the projected unit-credit method and financial assumptions net of inflation.

Under Mexican labor law, workers are entitled to certain benefits at the time of their departure from the Company under certain circumstances.

11.          Employee retirement obligations

The Company has a plan for covering seniority premiums which consist of a lump sum payment of 12 days’ wages for each year worked, calculated using the most recent salary, not to exceed twice the legal minimum wage established by law. Since 2005, the Company has recognized a liability for personal severance pay. The related liability and annual cost of such benefits are calculated by an independent actuary on the basis of formulas defined in the plans using the projected unit credit method.

F-26

12.   Employee retirement obligations

        The Company has a plan for covering seniority premiums which consist of a lump sum payment of 12 days' wages for each year worked, calculated using the most recent salary, not to exceed twice the legal minimum wage established by law. Since 2005, the Company has recognized a liability for personal severance pay. The related liability and annual cost of such benefits are calculated by an independent actuary on the basis of formulas defined in the plans using the projected unit credit method.

20

        As of December 31, 2006 and 2005, the present values of these obligations and the rate used for the calculations are:

        The transition liability will be amortized in a 10 to 22 year period, which is the average labor life remaining for the employees.

        The rates used in the actuarial analysis are as follows:

        As of December 31, 2006 and 2005 the additional liability was Ps.34,111 and Ps.32,756, respectively; the intangible asset which was included as part of the other assets, amounted to Ps.21,345 and Ps.24,215, respectively. The accumulated effect in the stockholders' equity as of December 31, 2006 and 2005 was Ps. 9,277 and Ps.(8,541), respectively.

11.                   Employee retirement obligations

The Company has a plan for covering seniority premiums which consist of a lump sum payment of 12 days’ wages for each year worked, calculated using the most recent salary, not to exceed twice the legal minimum wage established by law. Since 2005, the Company has recognized a liability for personal severance pay. The related liability and annual cost of such benefits are calculated by an independent actuary on the basis of formulas defined in the plans using the projected unit credit method.

F-18

As of December 31, 2005, the present values of these obligations and the rate used for the calculations are:

g.