Petrobras (PBR)

2.12 Deferred Income

Deferred income was extinguished as from fiscal year 2008, as a result of the amendment to Law 6.404/76 by Provisional Measure 449/08. However, the balance were reclassified to non-current liabilities - deferred income.

The discounts resulting from expectations of deferred income were reclassified, in the consolidated financial statements, to non-current liabilities.

3.13 Deferred income

Deferred income was extinguished as from fiscal year 2008 due to the amendment of Law 6.404/76 by Provisionary Measure 449/08. However, the existing balances as of December 31, 2008 and 2007 were reclassified to non-current liabilities in a specific account for deferred income, which will disclose the deferred income and the respective deferred cost.

The discounts resulting from expectations of deferred income were reclassified, in the consolidated financial statements, to non-current liabilities.

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Table of Contents

19 Deferred income

In accordance with CVM instruction 469, dated May 2, 2008, donations and subsidies resulting from operations and events occurring after law 11.638 of 2007 comes into force, will be temporarily recorded in specific deferred income accounts until the CVM issues specific rules on the matter.

At September 30, 2008, the balance of R$ 677.333 thousand is comprised of: R$ 600.759 thousand from an incentive subsidy for investments in the Northeast, within the region covered by the Northeast Development Agency (SUDENE), which granted a 75% decrease in income taxes payable, calculated on the activity profits from the incentive for activities; and R$ 76.574 thousand related to the portion of the reinvestment project approved by SUDENE.

The balances of the capital reserves referring to donations and subsidies for investments that existed at the end of fiscal year 2007 were held in their respective accounts until they had been fully used, in accordance with Law 11.638.

19 Deferred income

In accordance with CVM Instruction No. 469 dated May 02, 2008, donations and subsidies resulting from operations and events occurring as from the coming into force of Law No. 11.638 of 2007, are to be temporarily recorded in specific accounts under Deferred Income until the CVM issues a specific regulation on the matter.

At June 30, 2008, the balance of R$ 450.447 thousand is comprised of R$ 373.873 thousand from an investments subsidy incentive in the Northeast, within the region covered by the Northeast Development Agency (SUDENE), granting a 75% reduction in income tax payable, calculated on the profits of the exploration of the incentive activities, and R$ 76.574 thousand relating to the portion of the reinvestment project approved by SUDENE.

The balances of the capital reserves refer to donations and investment subsidies that existed at the end of the financial year of 2007 and have been maintained in their respective accounts until they have been fully utilized, in accordance with Law 11.638.

3.9 Deferred income

Net financial income and exchange and monetary variations, with a credit balance, attributable to ventures at the implementation stage, as a result of expansion, reorganization or modernization projects.

Net income received and not yet realized, where there is no type of obligation to return, either by handing over assets or provision of services.