building a STRONGER foundation - Cemex

CERs received from the UNFCCC are recognized as intangible assets at their development cost, which are attributable mainly to
legal expenses incurred with authorities in the process of obtaining such CERs;
We do not maintain emission rights, CERs and/or forward transactions for trading purposes.
The combined effect of the use of alternate fuels that help reduce the emission of CO2 and the downturn in produced cement
volumes in the EU has generated a surplus of emission rights held over the estimated CO2 emissions. From the consolidated surplus of
emission rights, during 2010, 2009 and 2008, we sold an aggregate amount of approximately 19.4 million certificates, receiving
revenues of approximately Ps1,417 million (U.S.$112 million), Ps961 million (U.S.$71 million) and Ps3,666 million (U.S.$327
million), respectively.
Revenue recognition
Our consolidated revenues represent the value, before tax on sales, of products and services sold by consolidated subsidiaries as
a result of ordinary activities, after the elimination of transactions between related parties. Revenues are quantified at the fair value of
the consideration received or receivable, decreased by any trade discounts or volume rebates granted to customers.
Revenue from the sale of goods and services is recognized when goods are delivered or services are rendered to customers, there
is no condition or uncertainty implying a reversal thereof, and they have assumed the risk of loss. Revenues from trading activities, in
which we acquire finished goods from a third party and subsequently we sell the goods to another third-party, are recognized on a
gross basis, considering that we assume the total risk of property on the goods purchased and we are not acting as agent or
commissioner.
Revenues and costs associated with construction contracts are recognized in the period in which the work is performed by
reference to the stage of completion of the contract activity at the end of the period, considering that the following have been defined:
a) each party’s enforceable rights regarding the asset to be constructed; b) the consideration to be exchanged; c) the manner and terms
of settlement; d) actual cost incurred and contract costs required to complete the asset are effectively controlled; and e) the probability
that the economic benefits associated with the contract will flow to us.
Status of our IFRS Migration Process
Based on requirements issued in 2009 by the Mexican National Banking and Securities Commission, or CNBV, all entities that
trade their securities in the Mexican Stock Exchange must adopt IFRS, as issued by the International Accounting Standards Board, or
IASB, for the preparation of their consolidated financial statements no later than January 1, 2012. We will adopt IFRS, as issued and
interpreted by the IASB, beginning on January 1, 2012. We began the planning of our IFRS migration process during the last quarter
of 2009. In summary, the status of our IFRS migration process as of the date of this annual report, is as follows:
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