This excerpt taken from the ICA 6-K filed Sep 7, 2007.
3. Summary of significant accounting policies
The accounting policies followed by the Company are in conformity with Mexican GAAP, which require that management make certain estimates and use certain assumptions that affect the amounts reported in the consolidated financial statements and the accompanying notes. Although these estimates are based on management's best knowledge of current events, actual results may differ. The significant accounting policies of the Company are as follows:
applying Mexican National Consumer Price Index (INPC) factors to monthly net monetary position. Gains (losses) result from maintaining a net monetary liability (asset) position, respectively.
operating losses or negative cash flows in the period if they are combined with a history or projection of losses, depreciation and amortization charged to results, which in percentage terms in relation to revenues are substantially higher than that of previous years, obsolescence, and other legal and economic factors.
balance sheet date. Exchange fluctuations are recorded as a component of net comprehensive financing cost (income) in the consolidated statements of income.