ANNUAL INTEGRATED REPORT 2021
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ANNUAL INTEGRATED REPORT 2021 | AXTEL
issuance of new shares are included in equity as a reduction from
the consideration received, net of tax.
v. Comprehensive income (loss)
Comprehensive income (loss) is comprised of net income (loss)
plus the annual effects of other reserves, net of taxes, which include
the translation of foreign subsidiaries, actuarial remeasurements,
the effects of the change in the fair value of derivative financial
instruments which are designated to cash flow hedges, and other
items specifically required to be reflected in stockholders' equity,
and which do not constitute capital contributions, reductions and
distributions.
w. Segment reporting
Segment information is presented consistently with the internal
reporting provided to the Chief Executive Officer, who is the highest
authority in operational decision-making, resource allocation and
assessment of operating segment performance.
x. Revenue recognition
Revenues comprise the fair value of the consideration received or
for the sale of goods and services in the ordinary course of the
transactions, and are presented in the consolidated statement
of income, net of the amount of variable considerations, which
comprise the estimated amount of returns from customers, rebates
and similar discounts and payments made to customers for the
purpose of accommodating goods in attractive and favorable
spaces at their facilities.
To recognize revenues from contracts with customers, the
comprehensive model for revenue accounting is used, which is based
on a five-step approach consisting of the following: (1) identify the
contract; (2) identify performance obligations in the contract; (3)
determine the transaction price; (4) allocate the transaction price
to each performance obligation in the contract; and (5) recognize
the revenue when the company satisfies a performance obligation.
The Company maintains managed service agreements with
customers from Government and business segments, which may
include multiple deliverables mainly consisting of the delivery
of equipment and provision of telecommunications services
and information technologies. The Company evaluates certain
agreements, in which it identifies more than one separable
performance obligation, which consists of the equipment used
to provide the service and that is installed in the facilities of the
customers. In addition to the equipment, telecommunications
and information technologies are identified as another separable
performance obligation.
Where the equipment delivered to the customer is a separable
performance obligation of the service, the Company assigns
the price of managed service agreements to the performance
obligations identified and described in the preceding paragraph
according to independent market values and related discounts.
The Company recognizes the revenue derived from managed
services agreements, as follows:
- Revenues from equipment installed in the facilities of customers is
recognized upon transfer of control or right to use them; i.e., at some
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