Untitled

MANAGEMENT REPORT LIGHT S.A.
2013
Message from the CEO In addition to listing our achievements, this report also outlines where we wish to be in the next years. In 2013, the international economic scenario became more stable. The global economy is showing signs of a slight recovery, especially in the !" and #urope, but $ra%il should continue to feel the adverse impacts. &'( grew by 2.3) over 2012. This low growth was accompanied by increasing inflationary pressure, fueled by infrastructure bottlenec*s and the exchange variation. +owever, national electricity consumption in $rasil moved up by 3.,) over 2012, once again outpacing &'( growth. The year began with high temperatures, resulting in an increase of electricity consumption. The hot weather was accompanied by exceptionally heavy rainfall, especially in the $aixada -luminense region, and .ight more than doubled its service contingent and mobili%ed the necessary resources in order to minimi%e the discomfort of its clients. In /anuary, the distributions went through the #xtraordinary Tariff 0evision process1. The short1term impact was positive for clients, who benefited from lower tariffs, which fell by 12.33) on average. 'espite the heavy rain in certain areas, the delayed arrival of the rainy season as a whole reduced hydroelectric plant reservoirs to critical levels, resulting in activation of the thermal plants. The high operating costs of these plants 4eopardi%ed the 'istribution utilities5s economic and financial balance. -ortunately, .ight5s operations in con4unction with other distributions and the $ra%ilian "ssociation of #lectricity 'istributors 6"$0"'##7, the $ra%ilian #lectricity 0egulatory "gency 6"8##.7, and the 9inistry of 9ines and #nergy 699#7 were able to find an alternative way, with the compensation of the extraordinary costs in the same year. :ith these problems behind us, we now focused on our main problem;energy theft. <ombating energy theft in 0io de /aneiro is particularly difficult, due to its strong social and cultural aspects, ma*ing it incomparable to any other concession in $ra%il the <ompany5s communications with its sta*eholders play an essential role. :e launched a campaign in various media and produced several institutional communication films, providing information and triggering a debate on the issue in society. "t the beginning of the second half, the entire wor*force was invited support a series of ma4or changes in the <ompany, under the =(roud to $e .ight> slogan. It was a call for action, designed to focus our attention on improving operating indicators and clients5 perception of the ?uality of our services. :e created the !pecial (ro4ects @ffice, which reports directly to the <#@5s @ffice and is responsible for ensuring the success, with the appropriate speed and consistency, of the <ompany5s priority pro4ectsA (1 B Cuality of !upply 6'#<7D (2 B <ombating .ossesD (3 B Tariff 0eviewD (E B .ife (rogramD (, B (roud to $e .ight and (3 B .ight and <#9I& !ynergy.
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MANAGEMENT REPORT LIGHT S.A. 2013
"lso at the beginning of the second half, we had other reasons to feel proudA the <ompany5s excellent performance in -I-"5s <onfederations <up and :orld Fouth 'ay. :ithout overshadowing the s*ills of the $ra%ilian team or (ope -rancis5 charisma, .ight ensured that energy was supplied at all the venues, thereby helping light up hearts and minds in both events, which drew the attention of millions of people around the world. $ut past victories are no guarantee of future success and .ight began preparing throughout the year for the next series of events. In the case of the 2013 @lympics, to be held in 0io, the <ompany too* part in several forums on the organi%ation of the event, which identified the need for a series of investments in the electricity networ* in order to ensure reliable energy supply during the &ames. (rudently, .ight sought out "8##. to clarify which investments, among those identified, are the responsibility of the concessionaire and which are solely in the interest of consumers. This analysis resulted in around 0G3H, million being earmar*ed for investments over the next three years 62013, 201E and 201,7, based on the <ompany5s own plan, in which almost all these investments are included in the 201E1201H tariff cycle. .ight obtained a specific financing line for the wor*s associated with the @lympic &ames from the $8'#!. In the specific case of the @lympic substation, which is not an obligation of the concession, with the support of the 99# we entered into a shareholders5 agreement with -urnas <entrais #lItricas at the beginning of 201E. This agreement involves management of the !pecific (urpose #ntity #nergia @lJmpica !", responsible for installing the substation, which will be dedicated exclusively to providing electricity for the @lympic <omplex being built in $arra da Ti4uca. In order to overcome these challenges, however, we first had to deal with another, the tariff revision, in which we obtained a fair result. The gains of scale between revisions was passed on to consumers, and there was proper recognition of our investments in the last five years, as well as our initiatives for combating non1technical energy losses, and the innovative solution for reducing them;the Light Legal pro4ect. This pro4ect became consolidated in 2013 as a ma4or initiative for combating the <ompany5s losses. "ssociated with an electronic metering system, the pro4ect is implemented in small areas called Kero .oss "reas 6"(Ks7, with around 1,,000 customers and high loss and default ratios, by companies that are hired to improve the indicators in each area. These exclusively dedicated teams, who receive a fixed salary1as well as a performance1based bonus, 1ensure a greater commitment to results. This configuration increases the productivity of the loss1combating process and reduces the need for the constant relocation of personnel, thereby reducing costs and environmental impacts. In 2013, Light Legal covered 33 areas and E13,000 clients, with significant results. .osses fell from E,.3) to 20.3) and timely payments increased from 20.1L) to almost 100) in these areas. :e also undertoo* several other initiatives as part of the special loss combat pro4ect 6(27, which formed the basis for consolidating the energy recovery strategies in all consumer segments,
especially on two ma4or frontsA shielded networ*s, for highMmedium and low1voltage 6$T7 clients, and electronic meters with Light Legal, for the 1low1voltage clients who lives in areas with high losses. These initiatives, together with the state government5s community pacification process, enabled .ight to record a positive result that had not been achieved for some time. 8on1technical energy losses totaled ,,L3H &:h in 2013, representing E2.1H) of billed consumption in the low1voltage mar*et, 3.2E p.p. down on the E,.E2) recorded in 2012, reflecting the <ompany5s commitment to combating this veritable plague. .ight is determined to reduce energy losses to around 30) by 201H. :e expanded dialogue with the wor*force through visits by the executive officers to the <ompany5s units. :e maintained the managerial meetings and resumed the leadership program, encouraging the <ompany5s managers and recogni%ing their achievements. :e also engaged our *ey managers in the drawing up of our strategic plan for the next five years. $ased on the views of several renowned independent specialists and a deep analysis of our strengths and wea*nesses, we outlined the main guidelines for .ight5s strategy until 201H. In order to achieve our strategic goals, we re1examined our holdings. In the generation segment, we returned the concession of the Itaocara hydroelectric plant because the remaining deadline for its implementation and start1up would not allow us to ensure a profitable operation. +owever, in partnership with <#9I&, we did consider the possibility of ta*ing part in the new auction for this plant5s concession, which the federal government should hold soon. :e also renegotiated .ight #nergia5s interest in 0enova #nergia with 00 (articipaNOes and <#9I& &eraNPo e TransmissPo, enabling the entry of <#9I& &T into 0enova5s controlling bloc* and the ac?uisition of 100) of $rasil (<+, as well as strengthening 0enova5s cash to be used in already contracted wind farm pro4ects, as well as in new growth opportunities involving renewable energy assets. In 2013, energy consumption increased by 2.2) to 2,,L1L &:h, net revenue 6excluding revenue from construction7 grew by 1.E) to 0G3,302 million, #$IT'" climbed by 1L.2) to 0G1,32L million, and net income grew by 3H.,) to 0G,HL million. 8on1technical energy losses 1, was 3.2Ep.p. down on 2012, while the collection rate came to 100.3), 2.3 p.p. up on 2012. &iven the increase in investments, net debt closed the year at 0GE,02, million, respecting the covenant limits. @n the stoc* mar*ets, it was a bad year for energy shares. :hile the Ibovespa index fell by 1L.L), and the I## #lectric (ower Index declined by 10.3), but .ightQs own shares appreciated by E.3). "t year1end, 3L.3) of the <ompany5s shares were held by non1controlling shareholders 6in addition to $8'#!(ar, with 10.3)7. :e remain fully committed to providing high1?uality services and to the sustainable development of our concession area, confirmed by our inclusion in the $9R-$ovespa5s <orporate !ustainability Index 6I!#7 for the seventh consecutive year. "ll our achievements have been possible only because of the unstinting support we have received from our $oard of 'irectors. In addition, the close and secure deliberations of our <ommittees have
enabled us to maintain a permanent dialogue, thus ensuring alignment between .ight5s activities and the $oard5s wishes, as well as reinforcing our <orporate &overnance model.
Corporate Profile .ight is present in 31 municipalities of the state of 0io de /aneiro, covering a population of more than 10 million. "t the end of 2013, , it had E,11H,120 clients. +ead?uartered in the city of 0io de /aneiro, the .ight &roup oup comprises the following companiesA Light S.A. 6holding company7D .ight !erviNos de #letricidade !.". 6Light SESA7, the distribution companyD .ight #nergia !.". 6Light Energia7, the generation companyD .ightger !.". 6Lightger7, responsible for the (aracambi ambi !+( pro4ectD Itaocara #nergia .tda. 6Itaocara7D "ma%Snia #nergia (articipaNOes !.". 6Ama !nia7, for participation in the $elo 9onte +ydropower (lant pro4ectD .ight #sco (restaNPo de !erviNos !.". 6Light Esco7 and .ightcom <omerciali%adora de #nergia !.". 6Lightcom7, both of which speciali%ing in energy tradingD .ight !oluNOes em #letricidade .tda. 6Light Solues7 and "xxiom !oluNOes TecnolUgicas !.". 6A""iom7, both service companiesD Instituto Light, an institutionD and <0 Kongshen #1(ower (ower -abricadora de TeJculos !.". 6E-Power7, which manufactures two1wheeled two electric vehicles.
Operating Scenario Operating Performance Energ# $istri%ution "ccording to preliminary 2013 data from the #nergy 0esearch <ompany 6#(#7, .ight ran*s as followsA 6i7 the fifth largest energy company in terms of total consumptionD 6ii7 the fifth largest in terms of total number of consumption unitsD and 6iii7 the fourth largest in terms of number of residential consumers.
&ariffs The $ra%ilian #lectricity 0egulatory "gency 6"8##.7 approved .ight !#!"5s tariff ad4ustment for all consumption categories 6residential, industrial, commercial, rural and others7. The tariff revision process has two main componentsA the tariff ad4ustment, which establishes tariffs compatible with the coverage of efficient operating costs and the returns on reasonable investmentsD and the V -actor, which establishes productivity targets for the subse?uent tariff period. :hen calculating the tariff ad4ustment, "8##. definesA 6i7 efficient operating costs, by updating the operating costs defined in the previous cycleD 6ii7 reasonable investments, which comprise the 0egulatory 0emuneration $aseD 6iii7 the level of regulatory losses to be passed on to consumersD and 6iv7 non1manageable costs. &iven the new financial component, applied only to the next 12 months, and excluding the financial component currently present in .ight !#!"5s tariffs, consumers received an average increase in their electricity bills of 3.3,), as of 8ovember L, 2013. "8##. also established the Vpd -actor of 1.22) and the Vt -actor of 0), calculated by the direct application of the e?uation defined in the regulatory methodology, which depends on mar*et growth, distribution networ* extension and the number of consumers between the tariff revisions. In regard to non1technical energy losses, the percentage to be recogni%ed in the tariff will be E0.E1) in the low1voltage mar*et, remaining unchanged throughout the cycle. The amount corresponding to the difference between this percentage and a reference figure that starts at 31.3L) at the beginning of the cycle until reaching 22.32) in 201H, will be invested in the <ompany5s energy loss combat program and treated as !pecial @bligations, outside the 0egulatory 0emuneration base. .ight5s efforts to combat energy losses will be monitored by "8##. as a condition for maintaining the E0.E1) level.
Mar'et (rowth
$illed captive and free clients in the concession area consumed a total of 2,,L1L L1L &:h in 2013, with E,11H,120 captive clients 6including own consumption7 c and 13E free clients. In addition to the free clients, there are fourteen generators connected to the <ompany5s distribution networ* who pay for the use of our system. In 2013, total energy consumption in .ight !#!"5s concession area 6captive clients lients W transport of free clients7 increased by 2.2) over 2012. "ll categories contributed to this result, especially the commercial segment, which accounted for 30.2) of the total mar*et and recorded annual growth of E.,). 0esidential consumption totaled ed H,312 &:h, accounting for 32.3) of the total mar*et and 2.0) more than in 2012, negatively impacted by the reclassification of condominiums from the residential to the commercial segment, as well as by the termination of contracts with clients with long1term long default. #xcluding these effects, residential consumption increased by E.L). In 2013 as a whole, average monthly consumption climbed by 2.2) to 1H,.2 *:h. *:h <ommercial clients consumed L,232 &:h, E.,) E. ) up on 2012, fueled by the reclassification of condominiums ominiums from the residential to the commercial segment. #xcluding this effect, commercial consumption fell by 2.2).
"nnual industrial consumption amounted to ,,33H &:h, 2.E) more than in 2012, led by higher consumption from the steelMmetallurgy and rubberMplastic rubberMplastic industries, which 4ointly accounted for 31.3) of total industrial consumption. consumption In the =others> category, which accounted for 1E.H) of the total mar*et, consumption increased by 2.3). "ll segments recorded an upturn, with the rural, government and public utility categories reporting respective increases of H.2), 0.2) and 3.1) over 2012. 2012 Consumption )rea'*own
+esi*ential Commercial In*ustrial !hare of the <ompany5s total mar*et 6)7 8umber of billed clients 6captive mar*et7 8umber of billed clients 6free mar*et7 ,-., ,.123.030 ,/.0 ,45.62/ 4,0 -3./0, 64 Other 46.3 -5.513 ,
Energ# Losses .ight !#!"5s total energy losses amounted to H,3,2 &:h, or 22.H) of the grid load, in the 12 months ended 'ecember 2013, 2013 0.H p.p. down on 'ecember 2012, and 0., p.p. less than in !eptember 2013. technical energy losses totaled ,,L3H 8on1technical &:h, accounting for E2.2) of billed energy in the low1voltage voltage mar*et 6"8##. criterion7, or 1,.L) of the grid load, 3.2 p.p. less than in 'ecember 2012. In order to improve the reduction in non1technical non technical energy losses, .ight has been continuously investing in initiatives that include conventional fraud inspection procedures, the upgrading of networ* and measurement systems, and the Kero .oss "rea program 6"(K7. In regard to new loss1reduction reduction technologies, the pace of installation accelerated in 2013 and the <ompany closed the year with E32,000 32,000 electronic meters installed.
<onventional energy recovery processes, such as the negotiation of amounts mounts owed by clients where fraud has been detected, resulted in the recovery of 1,E.1 &:h in 2013, 23.1) up on 2012, , while fraud f regulari%ation programs yielded a total of ,L,000 normali%ed clients, clients,L.0) comparing with the year before. In "ugust 2012, the <ompany created the "(K (ro4ect, based on a combination of electronic metering and a shielded networ*, supported by dedicated teams of technicians and customer relations personnel with clearly defined targets, whose compensation is tied to improving loss and default indicators in their respective areas. " typical "(K has around 1L,000 clients. The pro4ect, *nown commercially as Light Legal, which receives support from !#$0"# in regard to the training of partnering micro1 micro entrepreneurs, closed 'ecember 2013 with 23 operational "(Ks and E13,000 clients in the $aixada -luminense region, and the city5s west and north sides. !ince the beginning of the pro4ect, the "(Ks in place have already resulted in an average 20.3 p.p. reduction in non1technical non technical energy losses on low1 voltage billings and an average revenue increase of L., p.p.
$efault
The collection rate came to 100.3) of billed consumption in 2013, 2.3 p.p. more than in 2012, than*s to the year1long continuation of the default1combating program. The retail segmentQs collection rate grew by 2.H p.p., while the ma4or client segment recorded an upturn of 2.E p.p. and the government segment grew by 3.2 p.p., all of which in relation to 2012.
(rovisions for past due accounts 6(<.'7 accounted for 1.2) of gross billed energy and totaled 0G1,H.3 million, less than in 2012, when there was a non1recurring recurring impact from the ad4ustment of the estimate for the reception of past debt due from ma4or clients, including the government segment, in the amount of 0G111.L million.
Operating 7ualit# "8##. uses two indicators to evaluate concessionaires5 performance in regard to the continuity of electricity services provided per consumption unitA '#< 6e?uivalent length of interruption7 and -#< 6e?uivalent fre?uency ncy of interruption7. interruption7 In 2013, the moving average of the e?uivalent length of interruption indicator 6'#<7, expressed in time, registered 1H.E0 hours, while that of the e?uivalent fre?uency of interruption indicator 6-#<7, expressed in occurrences, stood at t H.31 times. times The EC13 '#< and -#< indicators recorded an improvement over the same period in 2012, than*s to the positive effects of the emergency action plan implemented in /une 2013, characteri%ed by more intensive tree pruning and energy networ* maintenance nance measures. If we compare them with no occurrence removals, due to the so1called so =critical daysX, calculated in accordance with "8##.5s methodology, i.e. in terms of what consumers actually experienced, '#< came to 20.EH hours and -#< to H.HL times. times " total of 202 medium1voltage voltage circuits were inspectedMmaintained, 3,L0H 3, transformers were replaced and 111,1HE trees were pruned. In the underground distribution networ*, 2,,2,E 2,,2,E transformer vaults
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and ,2,EL0 manholes were inspected. In addition, 23E transformers, 203 switches and 1,E0E protectors were maintained. '#< and -#< in 2013A
I8$ICA&O+ @verall '#< @verall -#<
+egulator# &A+(E&
O9erall +ES:L&
2.00 3.23
1H.E0 H.31
$EC an* ;EC ;EC nit 8umber of interruptions nit +ours -/44 L.L3 -/44 13.L3 -/4H.32 -/41H.1, -/4, H.31 -/4, 1H.E0
$EC
Customer Ser9ice #very year .ight has attained its goal of providing ?uality service by offering solutions for the needs of more than four million clients in the 31 municipalities ma*ing up the concession area, investing heavily in a multichannel platform to further improve its consumer communications and relations, accompanying the changes in the profile of its target audience in order to offer access anytime, anywhere. The <ompany also strives to captivate its clients, exceeding their expectations, by continuously focusing on customer satisfaction and improving its corporate image. The implementation and improvement of online channels has been one of the main strategies of the customer service and commercial relations area. In 2013, .ight received its fifth ."< seal B Loja Amiga do Cliente 6<ustomer5s -riend !tore7, a certificate granted by the $ra%ilian Institute for <ustomer 0elations 6I$0<7. The award highlights the ?uality of the <ompany5s service provided in its commercial branches. .ight5s own customer survey revealed an HH.E) satisfaction rating in the main index assessed 1 the !ervice !atisfaction Index 6I!#!7. The interviews only involve customers who have re?uested at least one of the services evaluated.
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In order to achieve even better results in the coming years, .ight is constantly concerned with improving the ?uality of its services, focusing its efforts on special pro4ects in the multichannel, access and customer comfort areas. $y strengthening its customer relationship channels, the <ompany see*s even greater proximity with its clients, aiming to provide correct guidance on information of public interest, as well as to disseminate all the initiatives the <ompany carries out to develop its concession area. (eneration In 2013, energy sales totaled E,HH1.H &:h, 2.1) down on 2012, mainly due to poor hydrological conditions, impacted by the delayed start of the rainy season and the conse?uent low level of hydro plant reservoirs.
LI(=& E8E+(IA >(?h@ 0egulated <ontracting #nvironment !ales -ree <ontracting #nvironment !ales !pot !ales 6<<##7 &otal
-/4, 1.0EE,3 3.32L,, 210,0 6.334.3
-/4E.103,0 LE3,3 ,23,H 5.,1,.6
A 1LE,,) 3H,,2) 1,2,2) -0.4A
In 2013, .ight #nergia generated E,322 9:h of net1 energy, 2.E) higher than the E,223 9:h recorded in 2012. "ll of the <ompany5s electricity is hydro1generated in the basin formed by the (araJba do !ul and 0ibeirPo das .a4es rivers. .ight #nergia5s generation complex comprises five plants with a 4oint installed capacity of H,, 9:, two pumping stations, two regulating reservoirs and six small reservoirs, located in the states of 0io de /aneiro and !Po (aulo.
(eneration Pro<ects The expansion in the generation segment is aligned with the <ompany5s !trategic (lan. The <ompany is constantly analy%ing its participation in greenfield or brownfield generation pro4ects in order to increase its installed capacity. .a4es !+( 1 The basic pro4ect has already been approved by "8##.. In /une 2013, "8##. altered the public service exploration regime to independent energy producer. "s a result, the !+( obtained a ,0) reduction in T !' and T !T fees. The hiring of the construction company is in progress. @nce the construction company is defined, it will be possible to begin the wor*s, with start1up scheduled for the first half of 2013, given that the pro4ect has already been granted an installation license. The 1L 9: turbine will be installed in the old powerhouse of the -ontes Telha power plant. In addition to increasing generating capacity, the pro4ect also brings certain other benefits, such as increasing
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operational flexibility, upgrading the supply of the <#'"# water main, controlling the (iraJ 0iver5s water level, and improving the ?uality of the water in the .a4es 0eservoir.
$elo 9onte +(( 1 In @ctober 2011, "ma%Snia #nergia, owned by .ight 62,.,)7 and <emig 6LE.,)7, ac?uired 2.LL) of 8orte #nergia, the consortium responsible for building and operating the $elo 9onte +ydroelectric (ower (lant. .ocated on the Vingu 0iver in the state of (arY, $elo 9onte is the largest 100) $ra%ilian hydro plant and the third largest in the world, with an installed capacity of 11,233 9: and assured energy of E,,L1 average 9:. The first turbine is scheduled for start1up in -ebruary 201, and all 2E turbines are expected to be operational by /anuary 2012. The construction wor*s are advancing, and the first phase of the electro1mechanical assembly wor*s at the (imental site is nearing completion.
&anhPes #nergia 1 The &uanhPes complex comprises four !+(sA 'ores de &uanhPes, -ortuna II, /acarI and !enhora do (orto, on the &uanhPes and <orrente &rande rivers and the 'oce river basin, all of which in the state of 9inas &erais, with a 4oint installed capacity of EE 9:. &uanhPes #nergia5s shareholders are .ight #nergia !.". 6,1)7 and <#9I& &eraNPo e TransmissPo !.". 6E2)7. The first turbine is scheduled for start1up in !eptember 201E and the final one in 9arch 201,.
0enova #nergia 6=0enova>7
Entr# of Cemig (& into the Compan#Bs controlling %loc'C "t the end of the year, 0enova entered into an agreement involving the ac?uisition of ,1) of $rasil (<+ and the entry of <emig &T into 0enova5s controlling bloc*. $rasil (<+ has 13 small hydroelectric power plants, with a 4oint installed capacity of 221 9: and assured energy of 12E average 9:. The <#9I& &T entry, which became effective in -ebruary 201E, added operational assets to 0enova, improving the balance between operational pro4ects and pro4ects under construction and development. $rasil (<+ will also ma*e a significant contribution to 0enova5s cash generation, enabling it to use the funds to invest in 0enova5s growth, both in terms of pro4ects already contracted and new pro4ects.
Dear of the largest contracting of energ# in +eno9aBs histor#. In 2013, 0enova sold 2,L.3 average 9:, corresponding to ,1E., installed 9: through two auctions on the regulated mar*et, as well as 1,.0 average 9: on the free mar*et.
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"t the 2013 0eserve #nergy "uction 6=.#0 2013>7, 0enova 0enova sold L3.L average 9: to be generated by nine wind farms located in the state of $ahia, with a 4oint installed capacity of 1,2.0 9:. 9: Commerciali ation In 2013, energy sales totaled E,12L.0 &:h, 1EE.,) more than the 1,L13.H &:h recorded in 2012, primarily primar due to the sale of energy from .ight #nergia, which became available after the maturity of the contracts ac?uired at the auction in 200E. 200E Thirteen service provision pro4ects were in progress, nine of which are still ongoing, including a co1generation generation pro4ect p for a large beverage company, five pro4ects in ma4or shopping malls, and one pro4ect related to the construction of a 13H *T transmission line for a large $ra%ilian mining company.
Eolume >(?h@
6.401./
1EE,,)
4.142.3
2012
2013
Capital E"pen*itures
.ight invested 0GHE,.0 million in n 2013, 2013 3.1) more than in 2012. The distribution segment absorbed the lion5s share of 0GL12.3 million 6representing representing HE.3) of the total7 2.L) up on 2012. @f this totalA A 6i7 0G3E2.H million went to the development of distribution and expansion networ*s, including luding the underground networ*, to *eep pace with mar*et growth, strengthen the networ* and improve ?uality, ?uality 6ii7 0G122.1 million went to the energy loss pro4ect 6networ* protection, electronic meters and fraud regulari%ation, regulari%ation and 6iii7 0G1EH.L 0G1EH million went to investments for the 201E -I-" :orld <up and 2013 @lympic &ames. &ames
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<ommerciali%ation and energy efficiency Investments increased from 0G23.1 million, in 2012, to 0G31.0 million in 2013, due to the co1generation pro4ect with a ma4or beverage company.
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Comments mments on ;inancial Performance an* Capital Mar'ets Mar'et ;inancial Performance
8et +e9enue In 2013, consolidated net operating revenue came to 0GL,E22.3 million, 3.3) up on 2012, 2012 or 0G3,302.0 million excluding xcluding construction revenue, up by 1.E). 8et revenue growth was mainly driven by the commerciali%ation and services segment, segment which recorded a 10,.,) annual upturn. upturn #xcluding revenue from construction, the generation and distribution segments posted annual increases of 33.2) and 1.,), respectively.
Costs an* E"penses #xcluding construction costs, operating costs and expenses totaled 0G,,220.3 3 million mil in 2013, 2.H) down on 2012, , primarily as a result of the L.0) reduction in non1manageable manageable costs, due to lower energy transmission and purchase costs, already incorporating the effects of 'ecree L2E,M13, with the total transfer of <'# 6energy development fund7 resources totaling 0GH01.1 million lion in the year. year
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E)I&$A #$IT'" came to 0G1,323.H million in 2013, 2013 1L.2) up on 2012, accompanied by an #$IT'" margin of 2,.L), 3.3 p.p. up on 2012, reflecting the repricing of energy generation contracts and the growth of the distribution mar*et, , which pushed up annual net revenue. :hen ad4usted for the <T", i.e. regulatory assets and liabilities that will be ta*en into account acc in the distributor5s next tariff ad4ustment, ad4ustment reflecting, therefore, gross future cash flow potential, potential ad4usted #$IT'" came to 0G1,323.H million in 2013, 2013 ,.3) down on 2012. The distribution segment accounted for L2,,) of consolidated annual #$IT'" in 2013, while the generation and commerciali%ation segments accounted for 23.0) and 1.,), respectively. respectively
8et Income 8et income totaled 0G,HL.3 million in 2013, 3H.,) up on 2012, due to the improved operating result from the distribution and generation companies. panies. Including the <T", ad4usted net income came to 0G,L3., 0 million, 10.L) down on 2012.
17
In*e%te*ness The <ompany closed 2013 with gross debt of 0G,,H1,.3 million, 2.3) less than at the end of !eptember 2013 and 3L.2), or 0G1.3 billion, up year1on1year year due to period fundingA 6i7 the disbursement of 0G,2 million from the $8'#!, , in the last 12 months, to .ight !#!"D 6ii7 the disbursement of 0G1,0 million from $anco do $rasil to .ight !#!" 6-ebruary 20137D 2013 6iii7 a foreign1 currency loan of 0G121 million ion from $anco To*yo1 To*yo 9itsubishi to .ight !#!", hedged by a 0eal swap transaction 69arch 20137D 6iv7 the disbursement of 0G,3 million from the $8'#! to .ight !#!" 69ay 20137D and 6v7 .ight !#!"5s 2th debenture issue, totaling 0G1.3 billion, with $anco do $rasil asil 6/une 20137, divided into two series, the first comprising 0G1.0 billion at the <'I interban* rate plus W1.1,) and the second, of 0G300 million, at the variation in the I(<" consumer price index plus ,.LE). The funds were used for investments, wor*ing capital and the prepayment of 0G,00 million in <ommercial 8otes issued in 9ay 2013 and 0G3L, million in more expensive debt, including 0G130 million from the ,th debenture issue, at a cost of the <'I plus 1.,). The 8et debtM#$IT'" ratio moved up from 2.H3x in 2012 to 2.HEx in 'ecember 2013. "s a result, the <ompany is still respecting its net debtM#$IT'" covenant limit of 3.0x. The <ompany also has a covenant for the #$IT'"Minterest expense ratio, which should be higher than 2.,x. The result for this indicator indi in 'ecember was 3.L2x. It is worth noting that non1compliance compliance with this covenant only occurs if the limits determined by the indicators are not respected for two consecutive or four alternate ?uarters. ?uarters
18
The <ompany5s debt has an average term to maturity of E.1 years, in line with the previous ?uarter. The average cost of 0eal1denominated debt was 2.L) p.a., 0.2 p.p. up on the end1of1!eptember figure. "t the close of 2013, 1E.,) of total debt was denominated in foreign currency, but considering hedges against exchange exposure, only 0.E) of this total was exposed to foreign currency ris*, in line with the previous ?uarter. .ight5s -V hedge policy consists of protecting cash flow from foreign1currency1 foreign denominated debt falling due within the next 2E months months 6principal and interest7 through the use of non1cash cash swap instruments with premier financial institutions. -unding via <entral $an* 0esolution E131, from 9errill .ynch, $8(, <itiban* and $an* To*yo19itsubishi, To*yo 9itsubishi, was contracted with swaps for the entire term of the debt.
Corporate (o9ernance an* the Capital Mar'et @n 'ecember 31, 2013, .ight !.".5s capital stoc* comprised 203,23E,030 common shares with no par value. The <ompany5s shares have been listed in the $9R-$ovespa5s 8ovo 9ercado trading segment segme since /uly 200,, therefore adhering to the best corporate governance practices and the principles of transparency and e?uity, in addition to granting special rights to minority shareholders. .ight !.".5s shares are included in the following indicesA Ibovespa Ibo 6$ovespa Index7, , I&< 6<orporate &overnance Index7, I## 6#lectric (ower Index7, I$rV 6$ra%il Index7, I!# 6<orporate !ustainability Index7, IT"& 6!pecial Tag "long !toc* Index7 and I'IT 6'ividend Index7, as well as the 9!<I &lobal #?uity Indices. .ight5s 5s shares are also traded on the .!. over1the1counter over counter mar*et through .evel 1 "'0s under the tic*er .&!VF. .ight5s $oard of 'irectors is composed of 11 members, two of whom are elected independently. The following five committees support the $oard of 'irectorsA 'irectorsA -inance, 9anagement, "udit, +uman 0esources, and &overnance and !ustainability. !ustainability
19
The chart below shows the performance of .ight5s stoc* between 'ecember 2H, 2012 and 9arch 0L, 201E.
20
Ownership Structure @n 'ecember 31, 2013, .ight was ,2.13) ,2.13) owned by the <ontrolling &roup, while the free float comprised EL.HL), 10.3) of which held by $8'#!(ar and 3L.,L) under the control of minority shareholders. The <ontrolling &roup comprises <ompanhia #nergItica de 9inas &erais 6<emig7, with 23.03), .uce uce #mpreendimentos e (articipaNOes !." 6.#(!"7, with 13.03), .03), and 0io 9inas #nergia !." 609#7, with 13.03).
@wnership structure on 'ecember 31, 2013
21
The table below shows the number of common shares held by .ight5s shareholders.
Sharehol*er 8o. of shares Countr# Interest Capital stoc' >+F@
09# 1 0I@ 9I8"! #8#0&I" ("0TI<I("Z[#! !." <@9("8+I" #8#0&\TI<" '# 9I8"! &#0"I! !.". 1 <#9I& . <# #9(0##8'I9#8T@! # ("0TI<I("Z[#! !.". $8'#! ("0TI<I("Z[#! !." 1 $8'#!("0 T+# ( $.I< &otal
23,,L3,1,0
$ra%il
13.03
220,033,221.0L
,3,1,2,22H
$ra%il
23.03
,H0,123,,30.31
23,,L3,1E2 21,00,,20H L3,32E,2,, -/,.0,6./2/
$ra%il $ra%il 1
13.03 10.30 3L.,L 4//.//
220,033,2H0.1, 222,2,2,3HE.E2 H33,302,3H1.2E -.--5.3--.401.30
22
$istri%ution of $i9i*en*s an* Interest on EGuit# .ight5s dividend payment policy establishes a minimum payout e?uivalent to ,0) of ad4usted net income. In 2013, the payout came to 0G122,2E3,,L3.32, divided into dividends of 0G21,LL0,32L.00. @n 'ecember 13, 2013, was approved by the $oard of 'irectors the payment of interest on e?uity in the gross amount of 0G 10L,EL3,2E2.32, representing 0G 0.,2L per share, considering the existence of income reported in the <ompany, in the period /anuary1!eptember 2013. @n 9arch 10, the $oard of 'irectors approved a proposal to distribute dividends in the amount of 0G 33E,H3H,033.3E, or 0G 1.LH2 per share, based on the profit in the balance sheet of 'ecember 31, 2013. "dding previous payouts during the year, the total payout was e?uivalent to HE,3) of ad4usted annual net income, with a 11,3) dividend yield. The proposal will be submitted to the approval of the shareholders at the next "nnual !hareholders5 9eeting.
Appro9al $i9i*en* $istri%uition - E9ent Deliberate yields in 2012: "&@# 0<" &otal Deliberate yields in 2014: To be approved in "&@ &otal
Appro9al $ate
$ate E".
$i9i*en* per share 0G 0.E, 0G 0.,3 0G 0.2H 0G 1.L2 0G 1.L2
Amount
Pa#ment $ate
&#pe
0EM23M2013 12M13M2013
0EM22M2013 12M13M2013 02M2EM2012

1
0G 21,LL0,32L.00 0G 10L,EL3,2E2.32 0G 122,2E3,,L3.32 0G 33E,H3H,033.3E 0G 33E,H3H,033.3E
12M2LM2013 12M2LM2013
'ividends /!<(
03M10M201E
ntil 12M31M201E
'ividends
23
Commitment to the ;uture
People Management .ight has been conducting an intense process of cultural alignment with all its employees, focusing on valuing life and engaging with the <ompany5s goals, through the .ight "cademy, which also aims to ensure organi%ational development through the promotion of excellent educational and human development practices. .ight5s initiatives and programs are based on the four pillars of <ulture, .eadership, #ducation and 'evelopment, which are the drivers for engaging people by means of actions that reinforce the <ompany5s mission, vision and values throughout the entire life cycle of the wor*force. In 2013, .ight continued to implement Programa Vida! 6.ife (rogram7, which fosters a culture based on safety and accident prevention, ensuring the delivery of results in a satisfactory manner. "round H2) of the wor*force 6employees W outsourced wor*ers7 and 22 partner companies too* part in the program. There were E,1 classes, totaling over H0,000 hours of training and 10,E00 participations. .ight also launched a new program, Orgulho de er Light 6(roud to $e .ight7, which aims to consolidate a results1driven culture by reinforcing the organi%ational ideology through a sense of belonging and team engagement. In line with this strategy, the <ompany has implemented several development, communication and recognition initiatives, rewarding and honoring those employees who have gone beyond the call of duty in the effective delivery of results. The year also saw another cycle of the .eadership 'evelopment (rogram, which began in 2012. There were four wor*shops in 2013, totaling over H,000 hours and involving 230 leaders 6of .ight itself and its service providers7, which achieved a satisfaction ratio of 2E). .ight5s $ehavioral <ompetence 9odel for leaders and employees is currently being revised in order to bring it into line with the 8ew @rgani%ational Ideology. The entire <ompetence 9odel will be disclosed in the second half of 201E. Occupational Safet# <ommitted to valuing life, in 2013 .ight achieved excellent results in terms of accident fre?uency and severity rates, exceeding all the established targets. Programa Vida! moved ahead with initiatives involving awareness1raising, education and communication, the Inspection (lan, professional ?ualification, integration with service providers, process reviews, prevention and the promotion of health . The Inspection (lan was implemented in order to increase the fre?uency and intensity of safety inspections, safety management audits in the main service providers, and vehicular camera monitoring. In 2013, .ight increased its safety inspections by 300). In addition, seven occupational safety management audits were carried out, as well as more than 1,300 field safety inspections.
24
@n the professional ?ualification front, 1H1 electricians were trained to perform all activities 6multifunctional7 and 131 technicians were trained to operate in substations. The main challenges faced by safety and health management are related to promoting initiatives to minimi%e the main accident ris*s 6electricity and traffic1related, and wor*ing at height7, and continuing to reduce accident fre?uency and severity ratesA
Acidentes Fatais
5 3
TF Taxa de Frequncia
5,04 4,08 2,34
TG Taxa de Gravidade
1179
1114
98
2011
2012
2013
2011
2012
2013
2011
2012
2013
"lso in 2013, .ight implemented the !afe:or* system, which consolidates all information related to field visits. If a deviation is observed during the inspection, the software sends an e1mail to the manager of the area re?uesting that remedial measures be ta*en. $y inserting the analyses in a single database, maintaining a historical registry of the inspections, it is possible to map recurring procedures and their relevance. The main benefits of the substantial reduction in the accident and absenteeism rates are the lower volume of 4udicial claims, higher productivity, increased 4ob satisfaction and an improved corporate image, thereby adding value to the <ompany. +esearch an* $e9elopment >+H$@ In 2013, .ight !erviNos de #letricidade !.". invested approximately 0G11 million and .ight #nergia !.". 0G2.E million, including pro4ect development and management costs from the 0R' (rogram, prepared in accordance with .aw n]. 2221, on /uly 2E, 2000. "ll in all, .ight !#!" developed 3, pro4ects and .ight #nergia 10 pro4ects, most of which priority initiatives begun in recent years which re?uired heavy investments in 2013. "s a result, new pro4ects played a secondary role, although two are particularly worth mentioningA production of the pioneering lot for the intelligent grid platform by .ight !#!", and the failure simulator for the analysis of generator systems protection by .ight #nergia.
En9ironment &ood environmental management practices are an integral part of all the <ompany5s various activities. .ightQs #nvironmental 9anagement !ystem 6#9!7, based on I!@ 1E001 standards, was
25
implemented in 2001 in order to define environmental ?uality standards for the <ompany5s power generation and distribution operations. $y ensuring compliance with environmental management re?uirements, the system helps .ight prevent fines, embargoes, accidents, legal proceedings and damage to the <ompanyQs image. In 2013, 22 distribution sites were certified, including 13H *T power lines and 13H *T and 2, *T substations, surpassing the annual target of 1H. <urrently, .ight5s certification rate stands at 21). In addition to I!@ 1E001 certification, all of .ight5s hydroelectric plants are certified by the occupational safety and health standards of @+!"! 1H001 and the ?uality standards of I!@ 2001. In 2013, the Integrated 9anagement !ystem completed ten years with the renewal of all three certifications, underlining the excellence of .ight5s generation plant operation and maintenance activities. "lso in 2013, the <ompany established a (rivate 0eserve in the area surrounding the 0ibeirPo das .a4es <omplex. The proposal was approved by "8##. and the environmental regulatory agency 6I8#"7, which regarded it a significant gain in terms of conserving the biological diversity of the "tlantic -orest in the TinguYB<unhambebe corridor. "s a result, .ight has played an important role in preparing the mosaics ma*ing up this corridor. In 201E, the plan is to proceed with the regulari%ation of documents to register the establishment of the reserve. "lso in partnership with I8#", in 2013 .ight launched the =(edra $ranca !tate (ar* Trail &uide> and sponsored the reopening of a permanent exhibition at the par*5s visitors5 center. "nother important initiative was the planting of 10,000 "tlantic -orest seedlings in a degraded area of the (ar* covering four hectares. 'espite the mandatory nature of this environmental compensation pro4ect, the <ompany went well beyond its obligations, dedicating considerable time and a number of specialists to the pro4ect. The <ompany is also committed to maintaining the area over the next few years in order to ensure growth of the seedlings.
Social Initiati9es In 2013, .ight maintained and strengthened its partnership with the state government, operating in areas where (acifying (olice nits 6(( s7 were installed. .ight5s investments in 0io de /aneiro5s pacified communities have created a new form of relationship with clients, based on regulari%ation and the changing of habits. Initiatives include the installation of a new shielded and telemetered networ*, and the implementation of the #fficient <ommunity and Light !e"i"la 6.ight 0ecycles7 pro4ects, ensuring higher ?uality supply, preventing energy theft, reducing timely payments, and raising community members5 awareness regarding the rational use of natural resources. The #fficient <ommunity (ro4ect involves replacing old refrigerators and light bulbs with more efficient ones, with the (rocel !eal. In addition to replacing e?uipment, .ight gives lectures and conducts visits, during which community members receive information on the responsible use of
26
energy. In 2013, 3E,3E2 educational visits were conducted, ,11,1LL light bulbs and 12,2,1 refrigerators were replaced and 2,203 heat1recovery and L,0 temperature1control systems were installed. Light !e"i"la trades recyclable materials for electricity bill discounts. This is a ma4or sustainability initiative, since it reduces environmental impacts through the reuse of solid waste while offering customers an alternative means of bill payment. Light !e"i"la had 3,032 registered clients at the close of 2013, during which 1,20, tons of recycling material and approximately L,000 liters of used vegetable oil were collected, representing energy savings of 3,33L 9:h. The recycling material is delivered to the so1called ecopoints, located in nine communities. Today Light !e"i"la has the support of the 0io de /aneiro municipal government, as well as sponsors such as <oca1<ola, +ortifruti, !upergasbrYs and !hopping .eblon, who finance the installation of the ecopoints. In 2013, the <ompany invested 0G1E.E million in the #fficient <ommunity (ro4ect and Light !e"i"la initiatives. Investments in improving the pacified community networ*s, including networ* shielding and telemetering, came to 0G33., million. @utside these communities, .ight invested 0GH1.3 million in shielding and telemetering and 0G,0 million in low and medium1voltage normali%ation. @f the 3E communities with (acifying (olice nits, .ight is present in 1L and has already concluded the remodeling of the networ* in nine, recording an average ,3.0 p.p. loss reduction 6from 3E.1) to 11.1)7 and an average HH.2 p.p. increase in timely payments 6from 2.3) to 2H.,)7. "lso in 2013, sponsorships in which .ight was involved absorbed investments of around 0G3,.L million, 0GH million of which by the <ompany. The selected pro4ects are related to the development of the concession area, income generation in areas where the ((s are installed and the visibility of the .ight brand. "ccording to the 0io de /aneiro !tate <ulture 'epartment, .ight is the main sponsor of cultural events and organi%ations in the state, notably the #esti$al do Vale do Ca%&, the <onservatory <inema 9usic -estival, the $ra%ilian !ymphony @rchestra' the 9usic in the !chools (ro4ect in $arra 9ansa, the #eira da Pro$id(n"ia' the $oo* $iennial and the <opacabana 8ew Fear5s #ve -estival.
27
Other InformationC In*epen*ent Au*itors In accordance with <T9 Instruction 3H1M2003, the <ompany hereby declares that 'eloitte Touche Tohmatsu "uditores Independentes provides the .ight &roup with ?uarterly external audit and review services and did not provide any other audit1related services in the fiscal year ended 'ecember 31, 2013. This 9anagement 0eport includes information related to pro4ected investments and non1financial data that do not pertain to the auditing of the financial statements and was therefore not reviewed by the independent auditors.
28
Annual Social Balance Sheet / 2013

Company: CONSOLIDATED
1 - Calculation Basis Net revenue (NR) Operating profit (OP) Gross payroll (GP) 2 Internal Social Indicators Meals Compulsory social charges Private pension Health care plan Occupational Safety and Health Education Culture Professional training and development Daycare centers or nursery allow ance Profit sharing Other Total - Internal Social Indicators 3 External Social Indicators Education Culture Health and sanitation Soprts Hunger eradication and food security Other Total contributions to society Taxes (excluding social charges) Total - External Social Indicators 4 Environm ental Indicators Investments related to the Companys production / operation Investments in external programs and/or projects Total environm ental investm ents With respect to the setting of annual goals to minimize residues, 2013 Am ount (thousand reais) 2012 Am ount (thousand 7,422,256 1,311,347 298,918 Am ount ('000) % on OP % on NR Am ount ('000) % on OP 25,756 9% 0% 21,866 11% 60,796 20% 1% 51,678 25% 7,380 2% 0% 8,083 4% 13,191 4% 0% 11,492 6% 1,192 0% 0% 798 0% 1,064 0% 0% 975 0% 0 0% 0% 0 0% 7,506 3% 0% 9,511 5% 971 0% 0% 823 0% 28,577 10% 0% 18,621 9% 5,264 2% 0% 5,831 3% 151,698 51% 2% 129,677 63% Am ount ('000) % on OP % on NR Am ount ('000) % on OP 6,683 1% 0% 5,936 1% 7,055 1% 0% 5,315 0% 264 0% 0% 1,408 0% 1,333 0% 0% 554 0% 0 0% 0% 0 0% 28,927 2% 0% 59,394 6% 44,262 3% 1% 72,607 7% 3,059,907 233% 41% 2,911,852 273% 3,104,169 237% 42% 2,984,459 279% Am ount ('000) % on OP % on NR Am ount ('000) % on OP 38,872 3% 1% 41,927 4% 0 0% 0% 0 0% 38,872 3% 1% 41,927 4%
( ) no go als ( ) co mplies 51to 75% (X) co mplies 76 to 1 00%
reais) 7,182,360 1,067,926 204,955 % on NR 0% 1% 0% 0% 0% 0% 0% 0% 0% 0% 0% 2% % on NR 0% 0% 0% 0% 0% 1% 1% 41% 42% % on NR 1% 0% 1%
the general consumption in production / operation, and improve the ( ) co mplies 0 to 50% efficiency in the use of natural resources, the Company: 5 Staff Indicators N of employees in the end of the period N of employees hired during the period N of outsourced employees N of interns N of employees above 45 years N of female employees % of management positions held by female employees N of black employees % of management positions held by black employees N of physically-disabled employees or employees w ith special needs 6 Significant inform ation w ith respect to the exercise of corporate citizenship Ratio betw een the highest and the low est compensation in the Total number of w ork accidents The social and environmental projects developed by the Company w ere defined by: The safety and health standards in the w ork environment w ere defined by: With respect to the trade union freedom, the right to collective and to agreement and the internal representation of employees, the The private pension plan includes:
( ) management ( ) management
( ) no go als ( ) co mplies 51to 75% ( ) co mplies 0 to 50% (X) co mplies 76 to 1 00%
2013 4,293 457 8,191 139 1,210 1,021 23.40% 1,874 18.30% 195 2013 0.4137 32
( ) all emplo yees ( X ) all + Cipa ( ) management
2012 4,223 470 8,786 135 1,204 1,000 24.31% 1,786 19.27% 190 2014 Targets ND 0
(X) management and managers ( ) all emplo yees ( X ) will fo llo w OIT standards ( ) management and managers ( ) management and managers ( ) will be suggested ( ) will suppo rt ( ) all emplo yees ( X ) all + Cipa ( ) will incentive and fo llo w OIT ( X ) all emplo yees ( X ) all emplo yees ( X ) will be required ( X ) will o rganize and incentivate in Co urt Reduce 1 0% in Co urt 1 00%
( ) management and managers ( ) do es no t get invo lved ( ) management
(X) management and managers ( ) all emplo yees
( ) management and managers ( ) do es no t get invo lved ( ) management ( ) management ( ) will no t be co nsidered ( ) do es no t get invo lved in the Co mpany Reduce 1 0% in the Co mpany 1 00%
( X ) fo llo ws OIT ( ) incentivates standards and fo llo ws OIT ( ) management ( X ) all and managers emplo yees ( ) management ( X ) all and managers emplo yees ( ) are ( X ) are requried suggested ( ) suppo rts ( X ) o rganizes and incentivates In co urt 33,991 In co urt 40%
The profit sharing includes: In the selection of suppliers, the same ethical and social and environmental responsibility standards adopted by the Company:
( ) are no t co nsidered ( ) do es no t get
With respect to the participation of employees in voluntary w ork invo lved programs, the Company: in the Co mpany in P ro co n Total number of complaints and criticisms of consumers according 28,957 2,237 to the Ombudsman Office in the Co mpany in P ro co n % of complaints and criticisms received of resolved by the 85% 85% Ombudsman Office Total value added to distribution (in thousands of R$): Em 2013: 5.296.979 Distribution of value added: 7 Other Inform ation 0
in Pro co n Reduce 1 0% in Pro co n 1 00%
Em 2012: 5.876.933
74,56% go vernment 5,1 8% emplo yees 4,37% shareho lders 1 3,05% 3rd parties 2,85% retain
65,60% go vernment 6,47% emplo yees 8,92% shareho lders 1 6,84% 3rd parties 2,1 7% retain
29
LI(=& S.A. )ALA8CE S=EE&S AS A& $ECEM)E+ ,4. -/4, A8$ -/4- A8$ IA8:A+D 4. -/4>In thousan*s of reais@ Parent Compan# ASSE&S <ash and cash e?uivalents 9ar*etable securities <onsumers, concessionaires, permissionaires and clients Inventories Taxes and contributions Income tax and social contribution (repaid expenses 'ividends and interest on e?uity receivable 0eceivables from services rendered 0eceivables from swap transactions @ther receivables &O&AL C:++E8& ASSE&S <onsumers, concessionaires, permissionaires and clients Taxes and contributions 'eferred taxes (repaid expenses <oncessionsQ financial assets #scrow deposits 0eceivables from swap transactions @ther receivables Investments (roperty, plant and e?uipment Intangible assets &O&AL 8O8-C:++E8& ASSE&S &O&AL ASSE&S 2 12 3E 10 11 12 13 3 L H 3E 10 L L 4-.,4.-/4, 23,H02 1 1 1 1 3,EE2 2L0 33,1,3 1E3 1 3,1E3 15.052 1 1 1 1 1 30, 1 1 3,EE2,0L3 3L2 1 ,.65/./5, ,.5-2.//0 4-.,4.-/4E,,E32 1 1 1 1 3,H,H 121 12,210 1EH 1 3,33, 15.564 1 1 1 1 1 2H2 1 1 3,031,033 3L2 1 ,./,4.006 ,.4/1.5,5 1 21, 1 1 3,10,,E,3 3L2 1 ,.4/2.,6, ,.-51.6// /4./4.-/4,,,0,L 1 1 1 1 3,32, 1H2 LH,,10 1,0 1 13,L33 454./51 1 1 1 4-.,4.-/4, ,E3,E22 1,2EE,000 1,223,E13 22,332 10,,H21 ,,,1E0 1,,H00 23E 22,H11 31,1,0 21E,223 ,.605.152 202,E1E HH,LLL 322,H3, 1 1,223,223 233,313 110,03E 2,LH3 3E2,203 1,3LH,L22 3,232,10H 0.5/2.654 4,.//-.-/1 Consoli*ate* 4-.,4.-/4+estate* 230,3,3 1,,233 1,EE1,,HH 30,3EH 123,2H, 3,L30 1,2,E 1 E2,1L1 3,,0L0 133,L1H -.421.432 2H2,E22 11H,HLH H30,033 1 1,,L3,3E2 22E,0L3 EL0 2,LH3 ,,L,3,0 1,33,,2,, 3,LEH,33H 3.03/.-24 44.461.661 /4./4.-/4+estate* 3,2,E3, H,1L1 1,3H3,3H2 2L,E30 133,33, 20,H,0 1,H1L 1 H2,,30 3,H01 132,H3E -.55,.265 22H,0LL 2,,322 H33,E11 3H3 3,3,EL3 23E,H23 L,E L,H,2 E32,333 1,301,0LE 3,HLH,233 3.4/-.411 4/.255.3--
8otes E , 3
&he notes are an integral part of the financial statements. Con9enience translation into English from the original pre9iousl# issue* in Portuguese
30
LI(=& S.A. )ALA8CE S=EE&S AS A& $ECEM)E+ ,4. -/4, A8$ -/4- A8$ IA8:A+D 4. -/4>In thousan*s of reais@
Parent Compan# 4-.,4.-/4, 4-.,4.-/4+estate* /4./4.-/4+estate* 4-.,4.-/4,
Consoli*ate* 4-.,4.-/4+estate* /4./4.-/4+estate*
LIA)ILI&IES
8otes
!uppliers Taxes and contributions Income tax and social contribution .oans, financing and financial charges 'ebentures and financial charges (ayable swap transactions 'ividends and interest on e?uity payable #stimated liabilities 0egulatory charges (ost1employment benefits @ther payables &O&AL C:++E8& LIA)ILI&IES .oans, financing and financial charges 'ebentures and financial charges (ayable swap transactions Taxes and contributions 'eferred taxes (rovisions (ost1employment benefits @ther payables &O&AL 8O8-C:++E8& LIA)ILI&IES S=A+E=OL$E+SJ E7:I&D <apital stoc* (rofit reserves (roposed additional dividends #?uity valuation ad4ustments @ther comprehensive income 0etained earnings &O&AL S=A+E=OL$E+SJ E7:I&D &O&AL LIA)ILI&IES A8$ S=A+E=OL$E+SJ E7:I&D
1E 1, 1, 13 1L 3E 2, 1H 21 22
22, 11,0EH 2 1 1 1 32,012 1,,E3 1 3 3,0,2 61.020
E,H 1,3E0 2 1 1 1 LE,L22 322 1 11 3,,1E 3/.3/0 1 1 1 1 1 1 1E2 201 4./6,
12L H,211 2 1 1 1 L3,LE1 233 1 1 2,EHH 35.511 1 1 1 1 1 1 1 -
20L,232 11,,102 H3,,13 ,21,EL0 ,1,030 1 32,012 33,,L3 32,HHE 1,22E,L33 1H3,H3L ,.,43.621,H23,E2L 3,3E2,31E 1 1HL,3E0 223,E10 ,E3,3,, 1 L3,020 2.-/2.2/2
H1E,E32 H2,3,3 ,0,3,3 3E2,2E2 11H,L23 1,,2L LE,L22 E3,H23 111,L13 113,10L 120,L33 4.05/.233 1,220,EH2 1,H,,,231 E,,32 12,,L,1 22L,20, 303,022 1,2,E,331 103,EH, 2.414./12
L,2,LEH H3,1E2 E0,2,2 232,HEE 213,LE0 LHL L3,LE1 E,,H,0 112,3,3 H0,,2, 21E,22H 4.33/.0-1 1,302,13E 1,L20,132 2L3 200,233 2E2,L,2 ,3H,H32 1,020,3HE 130,2,0 5.2/,./21
13 1L 3E 1, H 12 21 22
1 1 1 1 1 1 1 201 0/4
2E 2E 2, 2E 2E
2,22,,H22 ,3,,31E 332,H12 E22,E2H 6L3,31E7 1 ,.611.4,0 ,.5-2.//0
2,22,,H22 2,3,,3, 21,LL0 E,1,,,3 61L1,22L7 1L1,22L ,./-5.23, ,.4/1.5,5
2,22,,H22 3E1,32, 1H1,,01 EL2,3,3 632,2LH7 62,,3H7 ,.414.3-3 ,.-51.6//
2,22,,H22 ,3,,31E 332,H12 E22,E2H 6L3,31E7 1 ,.611.4,0 4,.//-.-/1
2,22,,H22 2,3,,3, 21,LL0 E,1,,,3 61L1,22L7 1L1,22L ,./-5.23, 44.461.661
2,22,,H22 3E1,32, 1H1,,01 EL2,3,3 632,2LH7 62,,3H7 ,.414.3-3 4/.255.3--
31
LI(=& S.A. I8COME S&A&EME8&S ;ISCAL DEA+S E8$E$ $ECEM)E+ ,4. -/4, A8$ -/4>In thousan*s of reais@ Parent Compan# Consoli*ate* -/4+estate*
-/4, 8otes 8E& +EEE8:E COS& O; OPE+A&IO8S (+OSS P+O;I& OPE+A&I8( EKPE8SES !elling expenses &eneral and administrative expenses @ther revenues @ther expenses E7:I&D I8 &=E EA+8I8(S O; S:)SI$IA+IES EA+8I8(S )E;O+E &=E ;I8A8CIAL +ES:L& A8$ &AKES ;I8A8CIAL +ES:L& 0evenues #xpenses +ES:L& )E;O+E I8COME &AK A8$ SOCIAL CO8&+I):&IO8 <urrent income tax and social contribution 'eferred income tax and social contribution 8E& I8COME ;O+ &=E DEA+ "ttributed to the controlling shareholders )ASIC EA+8I8(S PE+ S=A+E >+F L Share@ $IL:&E$ EA+8I8(S PE+ S=A+E >+F L Share@ &he notes are an integral part of the financial statements. Con9enience translation into English from the original pre9iousl# issue* in Portuguese 2L 2L 33 33 32 30 2H 30 1 >44.231@ 1 611,3HL7 1 1 2/3.060 501.-2>0.0-1@ 1,2LH 611,20,7 531.,,5 1 1 531.,,5 ,HL,33, 2.HH0 2.HH0
-/4-
-/4,
1 >44.664@ 1 611,EE17 1 1 664.,-5 6-0.336 >5.024@ 3,1HH 62,1E27 6-,.0-, 1 1 6-,.0-, E23,223 2.0L2 2.0L2
1.6--.-52 >5.636.352@ 4.0,1.6// >2-2./5,@ 62L1,,337 6E3,,H337 12E,2L2 6E3,3307 >5.656@ 4.,/5.30, >65,.10/@ 33H,1,H 6L21,2EH7 35-.4/, 6113,20E7 61,0,H3E7 531.,,5 ,HL,33, 2.HH0 2.HH0
1.43-.,2/ >5.554.6/1@ 4.2,/.05, >52,./-3@ 63H1,,2E7 6,3,,10E7 E1,,210 632,3107 -4.556 4./30.610 >604./06@ 122,,0H 63H3,3027 503.,35 611,,00H7 6,2,E,E7 6-,.0-, E23,223 2.0L2 2.0L2
32
LI(=& S.A. S&A&EME8&S O; COMP+E=E8SIEE I8COME ;ISCAL DEA+S E8$E$ $ECEM)E+ ,4. -/4, A8$ -/4>In thousan*s of reais@ Parent Compan# -/4, 8et income for the year @ther comprehensive income not reclassified to the income statement or in subse?uent periods &ains 6losses7 on actuarial liabilities, net of tax effects &O&AL COMP+E=E8SIEE +ES:L& "ttributed to the controlling shareholders &he notes are an integral part of the financial statements. Con9enience translation into English from the original pre9iousl# issue* in Portuguese 2,,3H3 23-.143 3H2,L1H 6132,0127 -04.0/6 221,20E 2,,3H3 23-.143 3H2,L1H 6132,0127 -04.0/6 221,20E ,HL,33, -/4E23,223 -/4, ,HL,33, Consoli*ate* -/4E23,223
LI(=& S.A. S&A&EME8&S O; C=A8(ES I8 S=A+E=OL$E+SN E7:I&D - PA+E8& COMPA8D A8$ CO8SOLI$A&E$ ;ISCAL DEA+S E8$E$ $ECEM)E+ ,4. -/4, A8$ -/4>In thousan*s of reais@ P+O;I& +ESE+EES CAPI&AL S&OCM )ALA8CE O8 $ECEM)E+ ,4. -/44 - +estate* 0eali%ation of e?uity valuation ad4ustment 'ividends declared by the "nnual !hareholdersQ 9eeting and paid 60G0.H2Mshare7 (roposed dividends 1 profit reserve 60G0.E,Mshare7 8et income @ther comprehensive results .oss of actuarial liabilities, net of taxes "llocation of net income for the yearA 0ecognition of legal reserve Interim dividends declared and paid 60G0.HEMshare7 Interest on e?uity 60G0.3,Mshare7 "bsorption of losses for the year )ALA8CE O8 $ECEM)E+ ,4. -/4- - +estate* 0eali%ation of e?uity valuation ad4ustment 'ividends declared by the "nnual !hareholdersQ 9eeting and paid 60G0.E,Mshare7 8et income @ther comprehensive results &ain of actuarial liabilities, net of taxes "llocation of net income for the yearA 0ecognition of legal reserve "ddition to minimum mandatory dividends 2,) 60G0.13Mshare7 Interest on e?uity declared and paid 60G0.,3Mshare7 "dditional dividends proposed 60G1.33Mshare7 0ecognition of earnings retention reserve )ALA8CE O8 $ECEM)E+ ,4. -/4, -.--5.3-1 1 1 1 1 1 1 1 1 -.--5.3-401.//1 1 1 1 1 22,33L 1 1 1 1 --2.,16 1 1 1 1H,L12 1 1 1 1 1 612,1027 50.5-3 1 1 1 1 1 1 1 1 2L2,L12 ,,0.-6/ 04.11/ 1 621,LL07 1 1 1 1 1 332,H12 1 ,,-.340 654.552 622,0,H7 1 1 1 1 1 1 1 1 6-0.603 1 1 1 1 1 1 1 1 1 1 >414.001@ 1 1 1 2,,3H3 1 1 1 1 1 >12.246@ 61H,L127 6132,HLL7 6H3,3L17 12,102 414.001 22,0,H 1 ,HL,33, 1 622,33L7 632,0127 610L,EL37 6332,H127 62L2,L127 1 6132,HLL7 6H3,3L17 1 ,./-5.23, 1 621,LL07 ,HL,33, 2,,3H3 1 632,0127 610L,EL37 1 1 ,.611.4,0 1 1 1 1 1 6132,0127 1 6132,0127 -.--5.3-1 1 1 1 LE(AL +ESE+EE 413.-33 1 1 1 1 +E&AI8E$ EA+8I8(S 42,.6/1 1 1 621,LL07 1 P+OPOSE$ A$$I&IO8AL $IEI$E8$S 434.5/4 1 61H1,,017 21,LL0 1 E7:I&D EAL:A&IO8 A$I:S&ME8&S 61-.,52 620,H007 1 1 1 O&=E+ COMP+E=E8SIEE +ES:L&S >,0.013@ 1 1 1 1 +E&AI8E$ EA+8I8(S >ACC:M:LA&E$ LOSSES@ >0.523@ 20,H00 1 1 E23,223
&O&AL
,.414.3-3 1 61H1,,017 1 E23,223
33
LI(=& S.A. S&A&EME8& O; CAS= ;LO? ;ISCAL DEA+S E8$E$ $ECEM)E+ ,4. -/4, A8$ -/4>In thousan*s of reais@ Parent Compan# -/4, -/4-/4, Consoli*ate* -/4+estate*
8et cash from operating acti9ities Cash generate* %# >use* in@ operations 8et income before income tax and social contribution "llowance for doubtful accounts 'epreciation and amorti%ation .oss 6gain7 from the sale of intangible asset Mproperty, plant and e?uipment -oreign exchange and monetary losses 6gains7 from financial activities (rovisions for contingencies and 4udicial deposits Mrestatement "d4ustment to present value and prepayment of receivables #xpenses with interest on loans <harges and monetary variation of post1employment obligations !wap variation #?uity in the earnings of subsidiaries 0emuneration of the concessionQs financial assets >Increase@L$ecrease in Assets an* Lia%ilities 9ar*etable securities <onsumers, concessionaires and permissionaires 'ividends and interest on e?uity received Taxes and contributions Inventories 0eceivables from services rendered (repaid expenses #scrow deposits @ther !uppliers #stimated liabilities Taxes and contributions 0egulatory charges (rovisions (ost1employment benefits @ther liabilities Interests paid Income tax and social contributions paid 8et cash from in9esting acti9ities "c?uisition of property, plant and e?uipment "c?uisition of intangible asset Investment ac?uisitions -inancial investments 8et cash generate* %# >use* in@ financing acti9ities 'ividends and interest on e?uity paid .oans, financing and debentures "morti%ation of loans, financing and debentures 8et increase >*ecrease@ in cash an* cash eGui9alents <ash and cash e?uivalents at the beginning of fiscal year <ash and cash e?uivalents at the end of fiscal year
-34.5,0 >-4.246@ ,HL,33, 1 1 1 1 1 1 1 1 1 630H,2E27 1 ,/,.45, 1 1 302,HEL 62,,HE7 1 1 6L27 6137 1EH 61337 1,1,1 6E,L127 1 1 1 6E327 1 1 >6/.-04@ 1 1 6E0,2217 1 >-50.045@ 62,2,21,7 1 1 >43.221@ E,,E32 23,H02
604.,,5 >41.6/-@ E23,223 1 1 1 1 1 1 1 1 1 6EE1,32,7 1 5/3.1,1 1 1 ,03,202 220 1 1 627 6LE7 2,32E 231 1,2 6L,2L17 1 1 1 2,0H, 1 1 >15.3/6@ 1 1 6L,,H0E7 1 >6-5.440@ 6E2,,1127 1 1 >0.533@ ,,,0,L E,,E32
4.,/2.,46 4.316.334 H,2,103 1,L,HHE 320,2E0 23,2H1 13H,322 23,H02 2,203 32L,33L 122,03, 6H0,2,07 ,,E,E 613H,H3L7 >523.521@ 612,03E7 130,E03 1 1,,2H, 3H3 12,330 613,HE37 6E0,1317 6L2,,337 22,EHL 12,L,0 2E,20H 6EH,H327 6HH,23,7 6123,,1L7 6E3,,L17 63H2,H2,7 6101,1,27 >-.4,1.65/@ 612E,LE37 6L0,,E237 620,,H17 61,213,L007 4.461.-/0 62,2,21,7 2,EEE,,31 61,03L,E0L7 ,42./1, 230,3,3 ,E3,E22
564.424 4.552.351 ,2H,3H, 2H2,302 3E2,3E2 20,HH1 20,2H2 2,0,233 E0,22H 31L,213 120,032 61E,E327 621,,,E7 6E0H,1,H7 >4./45.202@ HL1 63L2,E,H7 1 611E,0E07 62,21H7 E0,3H2 2E2 6,2,H,,7 H,1H2 12E,02H 2L3 3E,LL1 63E07 6H3,03H7 6120,,327 63H,3017 63,H,2EE7 6LE,H327 >336.350@ 611E,3237 63HH,,327 6L3,32H7 6L,2337 >13.644@ 6E2,,1127 1,11L,33H 6LL0,3307 >6--.4/0@ 3,2,E3, 230,3,3
34
LI(=& S.A. S&A&EME8&S O; EAL:E A$$E$ ;ISCAL DEA+S E8$E$ $ECEM)E+ ,4. -/4, A8$ -/4>In thousan*s of reais@ Parent Compan# Consoli*ate* -/4+estate*
-/4,
-/4-
-/4,
+e9enues !ale of goods, products and services 0evenue related to the construction of own assets "llowanceM0eversal of allowance for doubtful accounts Inputs acGuire* from thir* parties <ost of products, goods and services sold 9aterial, energy, outsourced services and other (ross 9alue a**e* +etentions 'epreciation and amorti%ation 8et 9alue a**e* pro*uce* Ealue a**e* recei9e* in transfer #?uity in the earnings of subsidiaries -inancial revenues &otal 9alue a**e* to *istri%ute $istri%ution of 9alue a**e* Personnel 'irect remuneration $enefits &overnment !everance -und for #mployees 6-&T!7 @ther &a"es. fees an* contri%utions -ederal !tate 9unicipal Ealue *istri%ute* to pro9i*ers of capital Interest 0ental @ther Ealue *istri%ute* to sharehol*ers 'ividends and interest on e?uity 0etained earnings &he notes are an integral part of the financial statements. Con9enience translation into English from the original pre9iousl# issue* in Portuguese
1 1 1 >2.400@ 1 63,1227 >2.400@ 1 >2.400@ 24/.--1 30H,2E2 1,2LH 2/6./-3 2/6./-3 5.4/E,L03 1H2 210 1 641 E1L 1 1 44.416 11,1LE 1 1 531.,,5 EL2,311 11,,02E
1 1 1 >1.,51@ 1 6L,3,L7 >1.,51@ 1 >1.,51@ 666.54, EE1,32, 3,1HH 6,1.452 6,1.452 ,.105 3,,23 11, HE 1 -3, 2H3 1 1 0.455 2,112 33 1 6-,.0-, 2,3,,EH 13L,3L,
4/.2-5.6-2 2,233,023 H20,2HE 61,L,HHE7 >5.-1/.-44@ 6E,02E,33H7 61,1L,,HE37 5.,55.-45 >,0/.06/@ 6320,2E07 6.026.-15 ,,-.1/6 6,,E,E7 33H,1,H 5.-02.010 5.-02.010 ,6-.152,2,EH1 ,2,2L3 22,L,E L,,EE ,.616.12, 1,223,HLE 2,23,,02L 12,L22 30-.4-0 H12,22E ,3,3,L 22,LLH 531.,,5 EL2,311 11,,02E
44./,1.2310,3,0,232 332,322 62H2,3027 >5./-5.420@ 6E,1E,,1127 6HH0,0,L7 2./4-.54, >,60.26-@ 63E2,3E27 5.22-.314 -46./221,,,E 122,,0H 5.312.0,, 5.312.0,, ,/6.420 22L,HLE E3,222 12,2,2 10,0,1 6.,34.235 2,010,EHH 2,332,E2, H,LL2 121.452 3HE,,L0 31,112 21,E3L 6-,.0-, 2,3,,EH 13L,3L,
35
CO8EE8IE8CE &+A8SLA&IO8 I8&O E8(LIS= ;+OM &=E O+I(I8AL P+EEIO:SLD ISS:E$ I8 PO+&:(:ESE
36
8O&ES &O &=E I8$IEI$:AL A8$ CO8SOLI$A&E$ ;I8A8CIAL S&A&EME8&S ;O+ &=E DEA+S E8$E$ $ECEM)E+ ,4. -/4, A8$ -/4>In thousan*s of )ra ilian reais O +F. unless state* otherwise@ 1) @(#0"TI@8! The corporate purpose of .ight !.". 6<ompany or =.ight>7, a publicly1held company head?uartered in the <ity of 0io de /aneiroM0/ 1 $ra%il, is to hold e?uity interests in other companies, as partner or shareholder, and the direct or indirect exploration, as applicable, of electric power services, including electric power generation, transmission, sale and distribution systems, as well as other related services. The <ompany is listed in the 8ew 9ar*et 6*o$o +er"ado7 segment of the $9R-$@T#!(" !Po (aulo !ecurities, <ommodities and -utures #xchange 6$9R-$@T#!("7, under the tic*er .I&T3, and in the .!. over1the1counter 6@T<7 mar*et, under the tic*er .&!VF. 2) &0@ (5! #8TITI#! a7 'irect !ubsidiaries .ight !erviNos de #letricidade !.". 6.ight !#!" B 100)7 B a publicly1held corporation, head?uartered in the city and state of 0io de /aneiro, engaged in the distribution of electric power, with a concession area comprising 31 cities in the state of 0io de /aneiro, including its capital. .ight #nergia !.". 1 6.ight #nergia B 100)7 B a publicly1held corporation, head?uartered in the city and !tate of 0io de /aneiro, whose main activities are 6a7 study, plan, construct, operate and explore systems of electric power generation, transmission, sales, and related services that have been legally granted or that may be granted or authori%ed to it or to companies in which it holds or may come to hold a controlling interestD 6b7 to hold interests in other companies as a partner, shareholder or ?uotaholder. It comprises the (ereira (assos, 8ilo (eNanha, Ilha dos (ombos, !anta $ranca and -ontes 8ovas plants, with a total installed capacity of H,, 9:. .ight #nergia holds interest in the following subsidiaries and 4ointly1controlled entitiesA <entral #Ulica !Po /udas Tadeu .tda. 6!Po /udas Tadeu B 100)7 1 a company at the pre1 operational stage whose main activity is the generation and sale of electric power through a wind powerplant located in the state of <earY, with 1H 9: nominal power. <entral #Ulica -ontainha .tda. 6-ontainha B 100)7 B a company at the pre1operational stage whose main activity is the generation and sale of electric power through a wind powerplant located in the state of <earY, with 13 9: nominal power. 0enova #nergia !.". 60enova #nergia 1 21.2), 4ointly1controlled entity7 B a corporation whose main activity is the generation of electric power through renewable alternative sources, such as small hydroelectric powerplants 6(<+s7, and wind and solar powerplants. 0enova #nergia holds direct or indirect interests totaling 1,2,3.3 9: contracted, EHE.3 9: of which in
37
operation or able to operate. It is 4ointly1controlled by .ight #nergia 621.2)7 and 00 (articipaNOes !.". 621.2) interest in the controlling bloc*7. The companies in which 0enova #nergia holds interests are listed belowA
Interest - +E8OEA E8E+(IA
#nerbras <entrais #lItricas !.". <entrais #Ulicas (lanaltina !.". <entrais #Ulicas <aetitI .tda. 8ova 0enova #nergia !.". $ahia #Ulica (articipaNOes !.". <entrais #Ulicas (indaJ !.". <entrais #Ulicas IgaporP !.". <entrais #Ulicas .icJnio de "lmeida !.". <entrais #Ulicas <andiba !.". <entrais #Ulicas IlhIus !.". !alvador #Ulica (articipaNOes !.". <entrais #Ulicas "lvorada !.". <entrais #Ulicas (a4e^ do Tento !.". <entrais #Ulicas "rapuP .tda. <entrais #lItricas $ela Tista .tda. 0enova <omerciali%adora de #nergia !." <entrais <oxilha "lta .tda. <entrais #Ulicas ItapuP III .tda <entrais #Ulicas ItapuP TI .tda <entrais #Ulicas ItapuP IV .tda <entrais #Ulicas ItapuP VII .tda <entrais #Ulicas ItapuP VT .tda <entrais #Ulicas ItapuP VTIII .tda <entrais #Ulicas ItapuP VVI .tda <entrais #Ulicas $ela Tista TIII .tda <entrais #Ulicas $ela Tista VIT .tda <entrais #Ulicas $ela Tista VTII .tda <entrais #Ulicas $ela Tista VV .tda ,d,i,i,d,i,i,i,i,i,i,i,i,i,d,d,d,d,d,d,d,d,d,d,d,d,d,d,d#nergItica !erra da (rata !.". <entrais #Ulicas 0io Terde !.". <entrais #Ulicas &uirapY !.". <entrais #Ulicas 8ossa !enhora <onceiNPo !.". <entrais #Ulicas &uanambi !.". <entrais #Ulicas (orto !eguro !.". <entrais #Ulicas !erra do !alto !.". 0enova #Ulica (articipaNOes !.". <entrais #lItricas $orgo .tda. <entrais #lItricas 'ourados .tda. <entrais #lItricas 9aron .tda. <entrais #lItricas !erra do #spinhaNo .tda. <entrais #Ulicas "metista .tda. <entrais #lItricas <edro .tda. <entrais #lItricas 0iacho de !antana .tda. <entrais #Ulicas .enNois .tda. <entrais #Ulicas ItapuP I .tda <entrais #Ulicas ItapuP IT .tda <entrais #Ulicas ItapuP TII .tda <entrais #Ulicas ItapuP V .tda <entrais #Ulicas ItapuP VIII .tda <entrais #Ulicas ItapuP VTI .tda <entrais #Ulicas ItapuP VIV .tda 0enovapar !." <entrais #Ulicas $ela Tista VII .tda <entrais #Ulicas $ela Tista VT .tda <entrais #Ulicas $ela Tista VTIII .tda ,i,i,i,i,i,i,i,i,i,i,i,i,i,d,d,d,d,d,d,d,d,d,d,d,d,d,d0enova (<+ .tda. <hipley !( (articipaNOes !.". <entrais #Ulicas #spigPo .tda. <entrais #Ulicas (elourinho .tda. <entrais #Ulicas (ilOes .tda. <entrais #Ulicas !Po !alvador .tda. <entrais #lItricas 9orrPo .tda. <entrais #lItricas !eraJma .tda. <entrais #lItricas Tan?ue .tda. <entrais #Ulicas dos "raNas .tda. <entrais #Ulicas da (rata .tda. <entrais #Ulicas Tentos do 8ordeste .tda. <entrais #lItricas $otu?uara .tda. <entrais #lItricas Itaparica .tda. <entrais #lItricas <on?uista .tda. <entrais #lItricas !antana .tda. <entrais #Ulicas 0ecSncavo .tda. <entrais #Ulicas ItapuP II .tda <entrais #Ulicas ItapuP T .tda <entrais #Ulicas ItapuP TIII .tda <entrais #Ulicas ItapuP VI .tda <entrais #Ulicas ItapuP VIT .tda <entrais #Ulicas ItapuP VTII .tda <entrais #Ulicas ItapuP VV .tda <entrais #Ulicas $ela Tista VIII .tda <entrais #Ulicas $ela Tista VTI .tda <entrais #Ulicas $ela Tista VIV .tda ,d,d,i,i,i,d,i,i,i,i,i,i,d,d,d,d,d,d,d,d,d,d,d,d,d,d,d-
6d7 6i7
'irect subsidiary of 0enova Indirect subsidiary of 0enova
The indirect interest held in 0enova (<+ .tda., 8ova 0enova #nergia !."., <entrais #lItricas $otu?uara .tda. and <entrais #lItricas Itaparica .tda. is 21.L), while in other companies is 21.2). &uanhPes #nergia !.". 6&uanhPes #nergia 1 ,1), 4ointly1controlled entity7 B a privately1held corporation in the pre1operational stage, head?uartered in the city of $elo +ori%onte B 9&, was created with the purpose of implementing and exploring small hydroelectric powerplants 6(<+s7 in the state of 9inas &erais, with total installed capacity of EE.H0 9:. The startup of the first (<+ is scheduled for /uly 201E and the last one for -ebruary 201,. The company is a 4ointly1controlled entity of .ight #nergia 6,1)7 and <emig &eraNPo e TransmissPo !.". 1 <emig &T 6E2)7.
.ight #sco (restaNPo de !erviNos !.". 1 6.ight #sco B 100)7 B a privately1held corporation, head?uartered in the city and state of 0io de /aneiro, whose main activity is the purchase, sale, import, export of electric power, thermal power, gas and industrial utilities, and provision of advisory services in the energy sector. The company is a member of the 9aracanP !olar consortium, which manages the photovoltaic plant installed on the top of the 9aracanP stadium 6,1)7. #'- <onsultoria em (ro4etos de &eraNPo de #nergia .tda. holds a E2) interest in this consortium. .ight #sco was
38
granted authori%ation from "8##. to become an independent producer of electric power. .ight #sco also holds interests in the following 4ointly1controlled entityA #$. <ompanhia de #fici_ncia #nergItica !.". 6#$. B 33.3), 4ointly1controlled entity7 B a company engaged in providing energy efficiency solutions and services and rental of e?uipment and facilities at units owned or rented by Telemar 8orte .este !.". /ointly1 controlled entity by .ight #sco 633.3)7, #colu% !.". 633.E)7 and (etrobrYs 'istribuidora !.". 633.3)7.
.ightcom <omerciali%adora de #nergia !.". 6.ightcom B 100)7 B a privately1held corporation, head?uartered in the city and state of !Po (aulo, engaged in the purchase, sale, import, export and provision of advisory services in the energy sector. Itaocara #nergia .tda. 1 6Itaocara #nergia B 100)7 B a company in the pre1operational stage, primarily engaged in the design, construction, installation, operation and exploration of electric power generation plants. It holds interest in the +# Itaocara consortium for the exploration of the Itaocara +ydroelectric (owerplant 6,1)7. <emig &eraNPo e TransmissPo !.". 1 <emig &T has a E2) interest. @n 8ovember 23, 2013, <oncession "greement 12M20011"8##., which governs the implementation and exploration of the Itaocara +ydroelectric (owerplant, was terminated, as detailed in note 11. .ight !oluNOes em #letricidade .tda 6.ight !oluNOes 1 100)7 B a limited liability company whose main activity is to provide services to low voltage clients, including the assembly, remodeling and maintenance of facilities in general. Instituto .ight para o 'esenvolvimento rbano e !ocial 6.ight Institute 1 100)7 B a non1profit private company, engaged in participating in social and cultural pro4ects, focused on the cities5 social and economic development, affirming the <ompany5s ability to be socially responsible. b7 /ointly1controlled entities .ightger !.". 6.ightger7 B a privately1held corporation whose purpose is to participate in auctions for concessions, authori%ations and permissions for new electric power plants. The (aracambi small hydroelectric powerplant 6(+<7 began operating in the third ?uarter of 2012. The company is 4ointly owned by .ight !." 6,1)7 and <emig &eraNPo e TransmissPo !.". 1 <emig &T 6E2)7. "xxiom !oluNOes TecnolUgicas !.". 6"xxiom7 B a privately1held corporation, head?uartered in the city of $elo +ori%onte, state of 9inas &erais, whose purpose is to offer technology solutions and systems for the operational management of public utility concessionaires, including electric power, gas, water and sewage companies. It is 4ointly owned by .ight !." 6,1)7 and <ompanhia #nergItica de 9inas &erais 1 <#9I& 6E2)7. <0 Kongshen #1(ower -abricadora de TeJculos !.". 6#1(ower7 B a privately1held company in the pre1 operational stage whose purpose is to manufacture =àsins*i> two1wheel electric vehicles. .ight !.". and <0 Kongeshen -abricadora de TeJculos !."., referred to as =àsins*i> are the company5s shareholders, holding 20) and H0), respectively, of #1(ower5s registered common shares.
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"ma%Snia #nergia (articipaNOes !.". 6"ma%Snia #nergia7 B a privately1held corporation whose purpose is to hold an interest, as a shareholder, in 8orte #nergia !.". 68#!"7, which holds the concession for the use of public assets to explore the $elo 9onte +ydroelectric (owerplant, on Vingu river, in the state of (arY. It is 4ointly owned by .ight !.". 62,.,)7 and <emig &eraNPo e TransmissPo !.". 1 <emig &T 6LE.,)7. "ma%Snia #nergia holds a 2.H) interest in 8#!", with significant influence on management, but without 4oint control. c7 .ight &roup <onsolidation "s established in <(< 12 B /oint ventures 6I-0! 117, approved by <T9 resolution 32EM12, in effect as of /anuary, 2013, interests in 4oint ventures must be recogni%ed as investments and accounted by the e?uity accounting method in replacement of the proportionate consolidation method, applied until 'ecember 31, 2012. "ccordingly, the consolidated financial statements include the shareholdings of the <ompany, its subsidiaries, which are consolidated as followsA
4-.,4.-/4, Percentage of interest >A@ $irect .ight !erviNos de #letricidade !.". .ight #nergia !.". <entral #Ulica -ontainha .tda. <entral #Ulica !Po /udas Tadeu .tda. .ight #sco (restaNPo de !erviNos !.". .ightcom <omerciali%adora de #nergia !.". .ight !oluNOes em #letricidade .tda. Instituto .ight para o 'esenvolvimento rbano e !ocial Itaocara #nergia .tda. 100.0 100.0 100.0 100.0 100.0 100.0 100.0 1 1 100.0 100.0 1 1 1 1 1 100.0 100.0 100.0 100.0 100.0 Percentage of interest >A@ In*irect 1 1 4-.,4.-/4Percentage of interest >A@ $irect 100.0 100.0 1 1 100.0 100.0 1 1 1 1 1 Percentage of interest >A@ In*irect 1 1
d7 .ight &roup5s concessions and authori%ations The main aspects of .ight !#!" and .ight #nergia5s concession agreements are listed belowA @n /une E, 1223, <oncession "greement 8o. 001M23 was entered into between the federal government 6granting authority through the $ra%ilian #lectricity 0egulatory "gency, "8##.7 and the subsidiary .ight !#!", regulating the exploration of electric power public utility services in the state of 0io de /aneiro, comprising the generation and distribution of electric power. !aid agreement5s duration is 30 years, and it may be renewed at the concessionaire5s re?uest and at the granting authority5s exclusive discretion. "s set forth in the concession agreement, all assets and facilities related to electric power distribution services and provided by the concessionaire are deemed reversible and comprise the respective concession5s assets. These assets will automatically reverse to the granting authority at the expiration of the agreement, valuations must be conducted and the indemnity owed to the concessionaire must be determined, observing the amounts and dates of incorporation into the electric system.
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The concessionaire5s main obligations provided for in the concession agreement areA i. To provide electric power to consumers located within its concession area, according to the tariffs ratified by the granting authority, within the levels of ?uality and continuity provided for by the legislation. To conduct the wor*s necessary to provide concession services, so as to ensure the continuity, regularity, ?uality and efficiency of services. To maintain records and inventory of concession1related assets and ensure their integrity. The sale, assignment or pledging as guarantee of real estate properties or essential parts of the facilities depend on the granting authority5s prior and express authori%ation. To comply with and ensure compliance with legal and regulatory service standards, answering before the granting authority, users and third parties for any damages caused by the exploration of services. To meet all the tax, labor and social security liabilities and charges deriving from regulatory rules laid down by the granting authority. To allow the granting authority5s inspectors free access to the wor*s, e?uipment and facilities used in the provision of services, as well as its accounting records, at any time. To report to the granting authority and users, according to specific legal and regulatory provisions, on the management of concession services. To maintain the electric power and water reserves re?uired to provide the public utility service. To comply with environmental protection laws, being liable for any conse?uences due to non1compliances. To conduct training programs, so as to permanently ensure the improvement of ?uality and efficiency in the provision of concession services. To participate in planning for the sector and the drafting of the 8ational #lectric !ystem expansion plans, implementing and ensuring compliance with technical and administrative recommendations deriving therefrom within its concession area. To adhere to the 8ational !ystem of #lectric (ower Transmission and ensure free access to its transmission and distribution systems. To operate its facilities in accordance with the prevailing rules. The concessionaire shall accept and apply any new resolutions, recommendations and instructions issued by "8##., the 8ational !ystem @perator 6@8!7 and #nergy 0esearch <ompany 6#(#7. To observe, pursuant to the prevailing laws, the limits of maximum and minimum downstream flow control of its hydroelectric developments, and consider in the
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ii.
iii.
iv.
v.
vi.
vii.
viii.
ix.
x.
xi.
xii.
xiii.
xiv.
operational rules the allocation of downtime volume in its powerplants reservoirs, so as to minimi%e adverse effects from floods. xv. :hen determined by the granting authority, to supply electric power to other concessionaires and interconnections, as re?uired, in accordance with the planning to supply the mar*et.
.ight !#!" is entitled to charge from consumers the tariffs established and ratified by the granting authority for the execution of services. The tariffs will be ad4usted yearly and the concessionaire5s revenue will be divided into two portionsA (ortion " 6composed of non1manageable costs7 and (ortion $ 6efficient operating costs and costs of capital7. The annual tariff ad4ustment aims at transferring non1manageable costs and monetarily restating manageable costs. The periodic tariff revision is carried out every five years to reestablish the concession5s economic and financial balance. The next tariff revision reference date will be 8ovember 201H. In this process, "8##. re1calculates the tariffs, ta*ing into account changes in the cost structure and the concessionaire5s mar*et, stimulating efficient and reasonable tariffs. "d4ustments and revisions are tariff restatement mechanisms, both provided for in the concession agreement. The concessionaire may also re?uest an extraordinary revision whenever any event causes any relevant economic and financial imbalance at the concession. The concession may be extinguished by the expiration of the agreement, service absorption, forfeiture, termination, irregularities or ban*ruptcy of the concessionaire. The concessionaire5s ma4ority controlling interest cannot be transferred without the granting authority5s prior consent. In the event shares representing the controlling interest are transferred, the new controlling shareholder shall sign an instrument of consent and submission to the clauses of the concession agreement and the concession5s legal and regulatory rules. The chart below summari%es the .ight &roup5s concessions and authori%ations effective on 'ecember 31, 2013A
Concessions L authori ations .ight !#!" and .ight #nergia (<+ (aracambi 1 .ightger sinas #Ulicas 1 0enova #nergia sinas #Ulicas 1 0enova #nergia sinas #Ulicas 1 0enova #nergia <entrais #Ulicas !Po !alvador .tda (<+ <achoeira da .ixa 1 0enova #nergia (<+ <olino 2 1 0enova #nergia (<+ <olino 1 1 0enova #nergia (<+ 'ores de &uanhPes 1 &uanhPes #nergia (<+ !enhora do (Srto 1 &uanhPes #nergia (<+ /acarI 1 &uanhPes #nergia (<+ -ortuna II 1 &uanhPes #nergia $ate /unM1223 -ebM2001 "ugM2010 9arM2011 to 9ayM2011 9arM2012 and "prM2012 9ayM2013 'ecM2003 'ecM2003 'ecM2003 8ovM2002 @ctM2002 @ctM2002 'ecM2001 E"piration /unM2023 -ebM2031 "ugM20E, 9arM20E3 to 9ayM20E3 9arM20EL and "prM20EL 9ayM20EH 'ecM2033 'ecM2033 'ecM2033 8ovM2032 @ctM2032 @ctM2032 'ecM2031
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The chart below presents the main information on 0enova #nergia5s authori%ationsA
Small h#*roelectric powerplant >PC=@ <achoeira da .ixa <olino 2 <olino 1 ?in* <entrais #Ulicas "lvorada !." <entrais #Ulicas <andiba !." <entrais #Ulicas &uanambi !." <entrais #Ulicas &uirapY !." <entrais #Ulicas IgaporP !." <entrais #Ulicas IlhIus !." <entrais #Ulicas .icJnio de "lmeida !." <entrais #Ulicas 8ossa !enhora <onceiNPo !." <entrais #Ulicas (a4e^ do Tento !." <entrais #Ulicas (indaJ !." <entrais #Ulicas (lanaltina !." <entrais #Ulicas (orto !eguro !." <entrais #Ulicas 0io Terde !." <entrais #Ulicas !erra do !alto !." <entrais #Ulica 9orrPo !." <entrais #Ulicas !eraJma !." <entrais #Ulicas Tan?ue !." <entrais #Ulicas da (rata !." <entrais #Ulicas dos "raNas !." <entrais #Ulicas Tentos do 8ordeste !." <entrais #Ulicas $orgo !." <entrais #Ulicas 'ourados !." <entrais #Ulicas 9aron !." <entrais #Ulicas !erra do #spinhaNo !." <entrais #Ulicas "metista !." <entrais #Ulicas <aetitI !." <entrais #Ulicas #spigPo !." <entrais #Ulicas (elourinho !." <entrais #Ulicas (ilOes !." <entrais #Ulicas !Po !alvador .T'" +ef. Agreement (0@I8-" (0@I8-" (0@I8-" +ef. Agreement .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 03M2002 .#0 0,M2010 .#0 0,M2010 .#0 0,M2010 .#0 0,M2010 .#0 0,M2010 .#0 0,M2010 .#8 02M2011 .#8 02M2011 .#8 02M2011 .#8 02M2011 .#8 02M2011 .#8 02M2011 .#8 02M2011 .#8 02M2011 .#8 02M2011 .#8 03M2012 A8EEL +esolution 32L 32, L03 MME Or*inance 32, 321 L00 LE3 323 320 322 323 32E 322 32L 32H LE2 3H2 23H 332 330 11L 2E1 131 222 130 10L 1L1 13, 13L 1L2 13H 12H 132 +esolution $ate 12M2EM2003 12M2EM2003 12M2EM2003 Or*inance $ate HM,M2010 HM,M2010 HM3M2010 HM12M2010 HM,M2010 HM,M2010 HM,M2010 HM,M2010 HM,M2010 HM,M2010 HM,M2010 HM,M2010 HM12M2010 HM,M2010 EM20M2011 ,M2LM2011 ,M23M2011 3M2,M2011 EMLM2011 3M1HM2011 EM13M2012 3M13M2012 3MHM2012 3M22M2012 3M1EM2012 3M21M2012 3M22M2012 3M21M2012 3M13M2012 ,M22M2013 Pro*uction Capacit# 1E.H 9: 13.0 9: 11.09: Pro*uction Capacit# H.0 9: 2.3 9: 20.H 9: 2H.H 9: 30.E 9: 11.2 9: 2E.0 9: 2H.H 9: 2,.3 9: 2E.0 9: 2L.2 9: 3.E 9: 30.E 9: 12.2 9: 30.2 9: 30.2 9: 30.0 9: 21.H 9: 31.2 9: 23., 9: 20.2 9: 2H.3 9: 30.2 9: 1H., 9: 2H.3 9: 30.2 9: 10.1 9: 21.H 9: 30.2 9: 22.E 9:
@n !eptember 11th, 2012, the federal government published #xecutive @rder 8o. ,L2 6=9( ,L2>7 in order to reduce electricity costs for consumers. @n !eptember 1Eth, 2012, (residential 'ecree 8o. L,H0, was enacted, defining some operating procedures to implement what was established in 9( ,L2 and, on /anuary 11th, 2013, 9( ,L2 was converted into .aw 12,LH3. This .aw allowed the concessionaires with agreements expiring between 201, and 201L the possibility of extending their concessions sub4ect to the conditions set forth therein. "s the agreements for the <ompany5s power generation concessionaires only expire as of 2023, the rules introduced by 9( ,L2 currently do not substantially affect the <ompany, except for the definition of the criterion for asset indemnification at the end of the concession at the 8ew 0eplacement Talue B 6=80T>7, as described in note 2.
43
.) "((0@T". "8' ! 99"0F @- T+# 9"I8 "<<@ 8TI8& (0"<TI<#! "'@(T#' I8 T+# (0#("0"TI@8 @- T+# -I8"8<I". !T"T#9#8T! The authori%ation for the conclusion of these financial statements was given by the <ompany5s $oard of 'irectors on 9arch 10, 201E. The <ompany5s financial statements compriseA The individual financial statements of the (arent <ompany prepared in accordance with the accounting practices adopted in $ra%il, identified as (arent <ompany 1 $0 &""(. The consolidated financial statements prepared in accordance with International -inancial 0eporting !tandards 6=I-0!s>7 issued by the International "ccounting !tandards $oard 6I"!$7 and the accounting practices adopted in $ra%il, identified as <onsolidated 1 I-0! and $0 &""(.
The accounting practices adopted in $ra%il comprise those in $ra%ilian <orporate .aw and the pronouncements, guidelines and technical interpretations issued by the $ra%ilian "ccounting (ronouncement <ommittee and approved by the -ederal "ccounting <ouncil B <-< and the $ra%ilian !ecurities and #xchange <ommission. The parent company financial statements present investments in subsidiaries, 4ointly1 and associated entities measured by the e?uity method of accounting, in accordance with the $ra%ilian legislation. Thus, these parent company financial statements are not considered as in compliance with I-0!, which re?uire the valuation of these investments in the parent company5s separate financial statements at fair value or cost. "s there is no difference between the consolidated e?uity and consolidated income attributable to the parent company5s shareholders, recorded in the consolidated financial statements prepared under I-0! and the accounting practices adopted in $ra%il, and the parent company5s e?uity and results recorded in the individual financial statements prepared in accordance with the accounting practices adopted in $ra%il, the <ompany has chosen to present the parent company and consolidated financial statements as a single set, side by side. These financial statements are presented in 0eal, which is the functional currency of the <ompany, its subsidiaries, 4ointly1controlled entities and associated companies. "ll financial information presented in 0eal was rounded up thousands, except when indicated otherwise. The accounting policies described in details below have been applied consistently to all fiscal years presented in these financial statements. a7 $asis of consolidation i. Investment in subsidiaries and 4ointly1controlled entities !ubsidiaries are all the entities 6including !pecial (urpose #ntities7 in which the <ompany has the following attributesA 6i7 power over the investeeD 6ii7 exposure to, or rights over, variable returns resulting from its involvement with the investeeD 6iii7 capacity to use its
44
power over the investee to affect the value of its returns. /oint venture arrangements, which involve the organi%ation of a separate entity in which each owner holds an interest, are called 4ointly1controlled entities. The financial statements of subsidiaries and 4ointly1 controlled entities are included in the consolidated financial statements from the date when control or shared control begins until the date when control or shared control ceases to exist. The accounting policies adopted by the subsidiaries and 4ointly1controlled entities are aligned with the policies adopted by the &roup. In the consolidated financial statements, as established by <(< 12 6027MI-0!111 /oint Tenture, approved by <T9 resolution 32EM12, in effect as of /anuary 1, 2013, interests in 4oint ventures must be recogni%ed as investments and accounted by the e?uity accounting method in replacement of the proportionate consolidation method, applied until 'ecember 31, 2012. These consolidated financial statements have already been prepared in accordance with this standard. ii.Investments in associated companies The associated companies are those entities in which the <ompany5s, directly or indirectly, has relevant influence on, but not control of, financial and operating policies. Investments in associated companies are accounted for by the e?uity method, both in individual and consolidated financial statements, and are initially recogni%ed at cost. The financial statements include e?uity variations at the associated companies, after ad4ustments to align their accounting policies with those of the &roup, as of the date a relevant influence starts to occur until the date when it ceases to exist. iii./ointly1controlled operations " 4ointly1 controlled operation is an operation in which owners use their own assets for the purposes of the 4ointly1 controlled operations. The consolidated financial statements include the assets the &roup controls and the liabilities incurred during the course of the activities of the 4oint operations, the expenses incurred by the &roup and its share of revenues from the 4oint operations. iv.Transactions eliminated in the consolidation Intragroup balances and transactions, and any unreali%ed revenues or expenses derived from intragroup transactions, are eliminated in the preparation of the consolidated financial statements. nreali%ed gains in transactions with investees accounted for by the e?uity method are eliminated against the relevant investment in proportion to the &roup5s interest in the investee. b7 -inancial instruments i. 8on1derivative financial assets The <ompany initially recogni%es financial assets on the inception date. "ll other financial assets 6including assets designated at fair value through profit and loss7 are initially
45
recogni%ed on the date of negotiation on which the <ompany becomes one of the parties to the contractual provisions. The <ompany derecogni%es a financial asset when the contractual rights to the asset5s cash flows expire, or when the <ompany transfers the rights to receive contractual cash flows over a financial asset in a transaction in which essentially all ris*s and benefits inherent in the ownership of the financial asset are transferred. @ccasional interest created or held by the <ompany in financial assets is recorded as individual assets or liabilities. The <ompany classifies non1derivative financial assets in the following categoriesA financial assets measured at fair value through profit and loss, loans and receivables and available1for1sale financial assets. ;inancial assets measure* at fair 9alue through profit an* loss " financial asset is classified at fair value through profit and loss if it is classified as held for trading or is designated as such at the moment of its initial recognition. -inancial assets are designated at fair value through profit and loss if the <ompany manages such investments and ma*es purchase and sale decisions based on their fair values, in accordance with its ris* management and investment strategy. Transaction costs are recorded in the income statement when incurred. -inancial assets recorded at fair value through profit and loss are measured at fair value and changes to the asset5s fair value are recogni%ed in the income statement. -inancial assets designated at fair value through profit and loss comprise mar*etable securities. Loans an* recei9a%les -inancial assets with fixed or determinable payments which are not priced on the active mar*et. These assets are initially recorded at fair value plus any attributable transaction costs. "fter initial recognition, loans and receivables are measured at amorti%ed cost through the effective interest rate method, less any impairment losses. .oans and receivables comprise cash and cash e?uivalents, trade accounts receivable, receivables from services provided and other receivables. A9aila%le-for-sale financial assets They are non1derivative financial assets not classified as loans and receivables, held to maturity or at fair value through profit or loss. "fter initial recognition, the interest calculated by the effective interest rate method and the ad4ustment of cash flow expectations are recogni%ed in the income statement, while the other changes in the fair value are recogni%ed in other comprehensive income. The result accumulated in other comprehensive income is transferred to the income statement for the fiscal year at the time the asset is reali%ed.
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"vailable1for1sale financial assets comprise the concessions5 financial assets. This instrument is classified as available for sale because it cannot be classified in the other categories. "s 9anagement believes that indemnification will be based on the current tariff pricing model, it would not be possible to record this instrument as loans and receivables, as the indemnification will not be fixed or determinable and as its recoverable amount is not *nown on this date, due to reasons other than credit deterioration. This is mainly due to the ris* of non1recognition of part of these assets by the regulatory agency and their respective replacement prices based on the 8ew 0eplacement Talue 680T7 criterion at the end of the concession. !ee note 2. ii. 8on derivative financial liabilities The <ompany initially recogni%es debt securities issued and subordinated liabilities on the inception date. "ll the other financial liabilities are initially recogni%ed on the date of negotiation when the <ompany becomes a party to the instrument5s contractual provisions. The <ompany writes1off a financial liability when its contractual obligations are withdrawn or cancelled or expire. The <ompany classifies non1derivative financial liabilities under other financial liabilities. !uch financial liabilities are initially recogni%ed at fair value plus any attributable transaction costs. "fter initial recognition, these financial liabilities are measured at amorti%ed cost through the effective interest rate method. The <ompany has the following non1derivative financial liabilitiesA loans and financing, debentures, suppliers, dividends and interest on e?uity, and other payables. iii. 'erivative financial instruments The <ompany operates with derivative financial instruments to hedge against foreign exchange variation and interest rate ris*s. 'erivatives are initially recogni%ed at fair value and attributable transaction costs are recogni%ed in the income statement as incurred. "fter initial recognition, derivatives are measured at fair value and changes in the fair value are immediately accounted for in the income statement. 'erivatives comprise swap transactions. iv. <apital <ommon shares are classified as shareholders5 e?uity. "dditional costs directly attributable to the issue of shares and stoc* options are recogni%ed as shareholdersQ e?uity deductions, net of any tax effects. 9inimum mandatory dividends are recogni%ed as liabilities, as defined in the <ompany5s $ylaws.
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c7 <ash and cash e?uivalents They include cash, ban* deposits and highly li?uid financial investments, originally due within three months from the contracting date or sub4ect to immaterial ris* of change in value, held to meet short1term cash commitments, and not for investment or other purposes. d7 <oncessions5 financial assets The <ompany recogni%es a financial asset deriving from concession agreements when it has an unconditional right to receive cash or another financial asset from the granting authority or a party designated by it at the end of the concession, pursuant to the agreement, as an indemnification for the construction services performed and not received through the provision of services related to the concession. These financial assets are measured at fair value at initial recognition 680T7 and classified as available for sale. The <ompany adopted the bifurcated model to recogni%e the financial asset resulting from the indemnification by the granting authority and the right of exploration of the concession, which is classified under intangible assets. e7 /udgments and estimates The preparation of financial statements in accordance with I-0! and $0 &""( standards re?uires 9anagement to ma*e certain 4udgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues and expenses. "ctual results may differ from these estimates. #stimates and assumptions are continuously reviewed. 0eviews regarding accounting estimates are recogni%ed in the fiscal year when the estimates are effectively reviewed and in any affected future years. Information about assumptions and estimates that have a significant ris* of resulting in material ad4ustments in the next financial year are included in the following 8otesA 8ote 03 B <onsumers, concessionaires, permissionaires and clients 6allowance for doubtful accounts and revenue to be billed7 8ote 0H B 'eferred taxes 8ote 02 B <oncessions5 financial assets 8ote 12 1 (rovisions 8ote 20 1 <ontingencies 8ote 21 1 (ost1employment benefits 8ote 22 B #lectric power supply 6non1billed7 f7 <onsumers, concessionaries, permissionaires and clients They include billed and unbilled electric power supply, default charges, interest on late payment and electricity traded with other concessionaries for electricity supply, according to the amounts available in the #lectric #nergy <ommerciali%ation <hamber 6<<##7. The allowance for doubtful accounts is recorded based on the 9anagement5s estimates in an amount sufficient to cover probable losses. The main criteria defined by the <ompany for
48
consumers areA 6i7 for consumers with significant amounts, an analysis is conducted on the balance receivable ta*ing into account the <ompany5s recovery trac* record, negotiations in progress and security interestD 6ii7 for other consumers, 100) of balance is accrued for debts overdue by more than 20 days for residential consumers, more than 1H0 days for commercial consumers, or more than 330 days for other consumers. These criteria comply with those defined by "8##.. g7 Inventories Inventories are recorded at the average ac?uisition cost, less allowances for losses, when applicable, and do not exceed their replacement costs or reali%able values. 9aterials in inventory are classified in <urrent "ssets 6maintenance and administration storeroom7 and those allocated to investments, classified in 8on1<urrent "ssets B (roperty, (lant and #?uipment or Intangible "ssets 6warehouse7. h7 Investments The financial information of subsidiaries, 4ointly1controlled entities and associated companies are recogni%ed in the individual financial statements of the parent company through the e?uity method. In the consolidated financial statements, investments in 4ointly1controlled entities and associated companies are accounted for by the e?uity method. The <ompany5s investments include the surplus value identified in the ac?uisition of interest, net of any accumulated impairment losses. i7 (roperty, plant and e?uipment i. 0ecognition and measurement They are measured at ac?uisition, formation or construction cost, less accumulated depreciation. <osts include expenses directly attributable to the ac?uisition of an asset. The costs of assets built by the <ompany itself includeA
The cost of materials and direct laborD "ny other costs to ensure that the asset is in place and prepared to operate as planned by 9anagementD <osts of loans over ?ualifying assets.
:hen parts of an item of property, plant and e?uipment have different useful lives, these are recorded as individual items 6main components7 of property, plant and e?uipment. &ains and losses on the disposal of an item of property, plant and e?uipment 6determined by the difference between the resources deriving from its disposal and its boo* value7 are recogni%ed under other operating revenuesMexpenses in the income statement.
49
ii. !ubse?uent costs !ubse?uent costs are capitali%ed to the extent that it is li*ely that future benefits associated with them will be earned by the <ompany. 0ecurring maintenance and repair costs are recorded in the income statement. iii. 'epreciation Items of property, plant and e?uipment are depreciated by the straight1line method against the income statement, based on each component5s estimated economic useful life. -or most property, plant and e?uipment items, the assets5 estimated economic useful lives are in line with those set forth by "8##., and land is not depreciated. -or the property, plant and e?uipment items without indemnity guarantee, the items are depreciated under the straight1line method up to the authori%ation or concession limit. Items of property, plant and e?uipment are depreciated as of the date on which they are installed and become available for use, or, in the case of assets built by the <ompany, on the date when construction is completed and the asset becomes available for use. The estimated useful lives for the current and comparative years are shown in 8ote 12. "ny ad4ustments to the depreciation methods, useful lives or residual values are recogni%ed as a change in accounting estimates. 47 Intangible assets i. <oncession agreements and infrastructure assets lin*ed to the concession The <ompany recogni%es an intangible asset deriving from a concession agreement when it is entitled to charge for the use of the concession5s infrastructure or explore it. "n intangible asset received as consideration for construction services provided in a concession agreement is measured at fair value upon initial recognition. -ollowing initial recognition, the intangible asset is measured at cost, which includes capitali%ed loans, less accumulated amorti%ation. The estimate of an intangible asset5s useful life in a concession agreement is the period counted when the <ompany is capable of charging consumers for the use of infrastructure until the end of concession period. ii. 0esearch and 'evelopment #xpenditures in research activities, made with a possibility of gaining *nowledge and scientific or technological understanding, are recogni%ed in the income statement as incurred. 'evelopment activities involve a plan or pro4ect aiming at producing new or substantially enhanced products. 'evelopment expenditures are capitali%ed only if the development costs can be reasonably measured, if the product or process is technically and
50
commercially viable, if future economic benefits are probable, and if the <ompany has the intention and enough resources to conclude the development and use or sell the asset. <apitali%ed expenditures include cost of materials, direct labor, manufacturing costs directly attributable to the preparation of the asset for its proposed use and cost of loans. @ther development expenditures are recorded in the income statement as they are incurred. <apitali%ed development expenditures are measured at cost, less accumulated amorti%ation and impairment losses, as applicable.
51
iii. @ther intangible assets @ther intangible assets with finite useful lives are measured at cost, less accumulated amorti%ation and losses from impairment, as applicable. iv. !ubse?uent expenditures !ubse?uent expenditures are capitali%ed only when they increase future economic benefits incorporated into the specific asset they relate to. "ll other expenditures are recogni%ed in the income statement as incurred. v. "morti%ation "morti%ation is recogni%ed in the income statement based on the straight1line method in view of estimated useful lives of intangible assets, from the date when they are available for use or for generation of related economic benefits. #stimated useful lives for current period are stated in 8ote 13. "morti%ation methods, useful lives and residual values are reviewed at the end of each financial year and are ad4usted whenever it is ade?uate as change of accounting estimates. *7 Impairment i. -inancial assets 6including receivables7 " financial asset not measured at fair value is evaluated at each reporting date to assess if there is ob4ective evidence of loss in its recoverable value. "n asset has loss in its recoverable value if ob4ective evidence indicates that a loss event occurred after the initial recognition of the asset, and that such loss event has a negative effect on future pro4ected cash flows, which can be reasonably estimated. The ob4ective evidence that the financial assets have lost value might include default or late payment by the debtor, restructuring the amount due to the <ompany under conditions the <ompany usually would not consider in other transactions, indications that the debtor or issuer will face ban*ruptcy, or the disappearance of an active mar*et for a security. "dditionally, for an e?uity instrument, a significant or long decrease in its fair value below its cost is an ob4ective evidence of impairment. ;inancial assets measure* at amorti e* cost The <ompany considers evidences of impairment of assets measured at amorti%ed cost either individually as collectively. "ll individually significant assets are assessed for impairment. "ll individually significant receivables identified as not suffering individual impairment are then collectively assessed regarding any other impairment not yet identified. 0eceivables that are not individually important are collectively assessed for impairment, by 4ointly grouping securities with similar ris* characteristics.
52
:hen collectively assessing impairment, the <ompany uses historical trends of probability of default, recovery term and incurred loss amounts, ad4usted to reflect the 9anagement5s 4udgment regarding premises, as current economic and credit conditions may be such that actual losses will be probably higher or lower than those suggested by historical trends. "n impairment related to a financial asset measured at amorti%ed cost is calculated as the difference between boo* value and present value of estimated future discounted cash flows at the original effective interest rate of the asset. .osses are recogni%ed in the income statement and reflected in an account of allowance for receivables. Interest on impaired assets remains being recogni%ed. :hen a subse?uent event indicates reversion of the impairment, a decrease on impairment is reversed and recorded in the income statement. 9anagement has not identified any evidence that 4ustifies the need to reduce the financial assets to their recoverable value as of 'ecember 31st, 2013 and 2012, except for the allowance for doubtful accounts and ad4ustment to the present value of receivables. ii. 8on1financial assets The boo* values of the <ompany5s non1financial assets, rather than inventories and deferred income tax and social contribution are reviewed every reporting date to chec* for impairment. If impairment occurs, then the asset5s recoverable value is estimated. In case of intangible assets with indefinite useful life, the recoverable value is estimated every year. The impairment is recogni%ed if the boo* value of an asset or cash generating unit 6<& 7 exceeds its recoverable value. The recoverable value of an asset or <& is the highest amount between the value in use and fair value less selling expenses. :hen evaluating the value in use, estimated future cash flows are discounted at their present values through discount rate before taxes to reflect mar*et5s current conditions as to recovery period of capital and specific ris*s of asset or <& . In order to test for impairment, assets that cannot be individually tested are grouped to the smallest group of assets that generate continued use cash inflow which are mostly independent from cash flows of other assets or groups of assets 6<& 7. Impairment losses are recogni%ed in the income statement. Impairment losses are only reversed when the asset5s boo* value does not exceed the boo* value calculated, net of depreciation or amorti%ation, in case loss of value has not been recogni%ed. l7 $enefits to employees i. 'efined contribution plans " defined contribution plan is a post1retirement benefit plan under which an entity pays fixed contributions to a separate entity 6(ension -und7 and shall not have any legal or constructive obligation to pay for additional amounts. .iabilities for contributions to
53
defined contribution pension plans are recorded as expenses with benefits to employees in the income statement in the periods during which services are rendered by employees. <ontributions previously paid are recogni%ed as assets under the condition that there is a cash reimbursement or a reduction in future payments is available. ii. 'efined benefit plans The net liability of the <ompany regarding defined benefit pension plans is individually calculated for each plan, by estimating the value of the future benefit the employees will earn in return of services rendered in current and previous periodsD the benefit is discounted to its present value. "ny unrecogni%ed past service costs and the fair values of any plan assets are deduced. The discount rate is the gains presented on the date of the financial statements for first line securities which due dates are close to the conditions of the liabilities of the <ompany and that are denominated in the same currency in which the benefits are expected to be paid. The calculation is made annually by a ?ualified actuary using the pro4ected unit credit method. :hen the calculation results in a benefit for the <ompany, the asset to be recogni%ed is limited to the total of any unrecogni%ed past service costs and the present value of economic benefits available as future reimbursements of the plan or reduction in future contributions to the plan. To calculate the present value of the economic benefits, any minimum cost demands applicable to any plan in the <ompany are considered. "n economic benefit is available to the <ompany if it is reali%able throughout the life of the plan, or in the settlement of the liabilities of the plan. The liability recogni%ed in the statement of financial position is e?uivalent to the higher amount between the debt contracted with the -oundation to amorti%e actuarial liabilities and the present value of net actuarial liabilities. The sponsorship costs of the pension plan and occasional plan deficits are immediately recogni%ed in shareholders5 e?uity, in other comprehensive income, in conformity with <T9 0esolution no. 32,M12. "ctuarial gains and losses arising from ad4ustments and changes in actuarial premises of pension and retirement benefit plans are immediately recogni%ed in shareholders5 e?uity, in other comprehensive income, and are not transferred to accumulated losses and retained earnings. iii. !hort term benefit to employees !hort1term benefit liabilities to employees are measured in undiscounted basis and are incurred as expenses as the related service is rendered. The liability is recogni%ed at the amount expected to be paid under the cash bonus or short1term profit sharing plans if the <ompany has a legal or constructive obligation to pay this amount due to past services rendered by the employee and the liability can be reasonably estimated.
54
m7 (rovisions " provision is recogni%ed when the <ompany has a presumed or legal liability that can be reliably estimated as the result of a past event, and it is probable that an economic resource is re?uired to settle the liability. (rovisions are recorded based on the best estimates of ris* involved and expected future cash flows. " provision for ris*s is recorded by evaluating and ?uantifying lawsuits, whose probability of loss is deemed as probable, in the opinion of the 9anagement and its legal counsels. n7 0evenue recognition 0evenues are measured at fair value of the receivable or received counterpart, less taxes and discounts inherent to revenues. i. #lectricity sales revenues These are recogni%ed when there is conclusive evidence that most significant ris*s and benefits inherent to the assets5 ownership were transferred to the buyer, is probable that the economic benefit associated with transactions will flow to the <ompany and the amount of revenues can be reasonably measured. Traded electricity is monthly invoiced based on the electricity supply, according to amounts disclosed by the #lectric #nergy <ommerciali%ation <hamber 6<<##7. ii. !ervice 0evenues 0evenues from services rendered are recogni%ed in the income statement based on the stage of completion of services on the reporting date of the financial statements. The stage of completion is evaluated by referencing research of wor*s performed. iii. <onstruction 0evenues <ontractual revenues comprise the initial value agreed upon in the agreement plus variations deriving from additional re?uests, complaints and payments of contractual incentives, sub4ect to the condition that probably these will result in revenues and that can be reliably measured. "s soon as a construction agreement can be reasonably estimated, the agreement5s revenue is recogni%ed in the income statement to the extent of the agreement5s completion phase. <ontractual expenses are recogni%ed when incurred, unless they generate an asset related to the forward agreement5s activity. The completion phase is evaluated by referencing wor*s conducted. :hen results of a construction agreement cannot be reliably measured, the agreement5s revenue is recogni%ed until the limit of costs recogni%ed sub4ect to the condition that costs incurred can be recovered. "greement5s losses are immediately recogni%ed in the income statement. 0evenue related to construction services and improvement of concession agreements is recogni%ed based on the completion phase of wor* executed, compatible with the
55
<ompany5s accounting policies for recognition of construction agreements5 revenues. @peration or service revenues are recogni%ed in the period services are provided by the <ompany. :hen the <ompany provides more than one service in the concession agreement, the consideration received is allocated by reference to the fair value of services delivered when values are separately identifiable. -or revenues and costs related to construction services or improvement of infrastructure used in electricity distribution services, the construction margin adopted is established as being e?ual to %ero, considering thatA 6i7 the main activity of the subsidiary is electricity distributionD 6ii7 every construction revenue is related to the construction of infrastructure to reach its main activityD and 6iii7 the <ompany outsources the construction of infrastructure with non1related parties. The totality of additions to intangible assets in process is monthly recorded in the income statement, as construction cost. o7 -inancial revenues and expenses -inancial revenues comprise interest income from financial investments, variations in the fair value of financial assets measured at fair value through profit and loss. Interest income is recogni%ed in the income statement, through the effective interest rate method. -inancial expenses comprise interest expenses over loans, present value discount ad4ustments and changes in the fair value of financial assets measured at fair value through profit and loss. $orrowing costs which are not directly attributable to ac?uisition, construction or production of a ?ualifying asset are measured at profit and loss through the effective interest rate method. #xchange gains and losses are reported on a net basis.
p7 Income tax and social contribution <urrent and deferred income tax and social contribution of the year are calculated based on 1,) rates, plus 10) surcharge over the taxable income exceeding 0G2E0 for income tax and 2) over the taxable income for social contribution on net income and consider social contribution tax loss carryforwards, restricted to 30) of taxable income. Income tax and social contribution expenses comprise current and deferred income taxes. <urrent and deferred taxes are recogni%ed in the income statement unless these are related to items directly recogni%ed in e?uity, in other comprehensive income. <urrent tax is the tax payable on income or recoverable tax in the case of advances exceeding the taxable profit of the year, at tax rates decreed or substantially decreed on the reporting date of the financial statements and any ad4ustments to payable taxes related to previous years. 'eferred tax is recogni%ed regarding temporary differences between fair value of assets and liabilities for accounting purposes and the corresponding values for taxation purposes, as well as regarding existing and recoverable balances of tax losses and tax loss carryforwards.
56
'eferred tax is measured by rates to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantially enacted until the reporting date of the financial statements. :hen calculating current and deferred income tax, the <ompany ta*es into account the impact of uncertainties related to tax positions assumed and if additional payment of income tax and interests has been made. The <ompany believes that the provision for income tax under liabilities is appropriate in relation to all outstanding tax periods based on its assessment of several factors, including tax laws interpretations and past experience. This evaluation is based on estimates and assumptions that may involve a series of 4udgments on future events. 8ew information may be available, which would lead the <ompany to change its 4udgment as to the ade?uacy of current provisionD these changes will impact income tax expense in the year they occur. <urrent and deferred tax assets and liabilities are offset if there is a legal right to offset current tax assets and liabilities, and they relate to income taxes charged by the same tax authority on the same entity sub4ect to taxation. " deferred income tax and social contribution asset is recogni%ed by tax losses, tax credits and deductible temporary differences, not used when it is probable that future profits sub4ect to taxation will be available and against which they shall be used. 'eferred income tax and social contribution assets are reviewed on each closing date and are reduced as their reali%ation is no longer probable. "s provided for by .aw 8o. 11,2E1M02, the <ompany uses the Transition Tax 0egime 60TT7 to calculate taxable income, so that the changes in the criteria of recognition of revenues, costs and expenses comprised in the calculation of the net income for the year do not have material effects on the calculation of the taxable income of the entity sub4ect to 0TT, and for taxation purposes, the accounting methods and criteria in force on 'ecember 31st, 200L shall be considered. @n 8ovember 11, 2013, #xecutive @rder 32L 69(7 was published revo*ing the Transitory Tax 0egime and introducing other measures, includingA 6i7 amendments to 'ecree1.aw 1,,2HMLL, which addresses the income tax of companies, and changes the legislation related to social contribution on net incomeD 6ii7 it establishes that the change to or the adoption of accounting methods and criteria, through administrative acts issued based on the authority assigned by commercial law, following the publication of this #xecutive @rder, will not imply in the calculation of the federal taxes until the tax law regulates on such matterD 6iii7 it includes the specific treatment for the potential taxation of income or dividendsD 6iv7 it includes a provision on the calculation of interest on e?uityD and 6v7 it includes considerations on investments measured by the e?uity method. The 9( provisions enter into effect as of 201,, but this 9( allows taxpayers to opt for their early adoption in 201E as a condition to eliminate any tax effects related to dividends paid until the date of publication of said 9(, the calculation of interest on e?uity and the valuation of material investments in subsidiaries and investees through the e?uity method of accounting. <onsidering that the 9( may change substantially through amendments, the <ompany will await its
57
conversion into .aw for a conclusive analysis. +owever, preliminary studies indicate that there will be no material impacts on the <ompany5s financial statements. ?7 #arnings per share $asic earnings per share are calculated through profit or loss for the fiscal year attributable to the <ompany5s controlling shareholders and the weighted average number of shares in the respective fiscal year. 'iluted earnings per share are calculated through said average number of shares, ad4usted by instruments potentially convertible into shares, with a diluting effect in the reported periods. r7 !egment information "n operating segment is a component of the <ompany that develops business activities in which it can obtain revenues and incur in expenses, including revenues and expenses related to transactions with other components of the <ompany. "ll results from operating segments are fre?uently reviewed by the 9anagement, in order to ma*e decisions regarding the resources to be allocated to the segment and to assess their performance, and for this purpose individual financial information is available. The segment results reported to the 9anagement include items directly attributable to the segment, as well as those that may be allocated reasonably. s7 -oreign currency Transactions in foreign currency are converted to the functional currency of the <ompany at the exchange rates on the transaction dates. 9onetary assets and liabilities denominated and calculated in foreign currencies are converted to the functional currency at the exchange rate of the reporting date. &ains and losses resulting from restatement of these assets and liabilities between the exchange rate in force on the transition date or at the year1beginning and year1end dates are recogni%ed as financial revenues or expenses in the income statement. t7 (resent value ad4ustment The items sub4ect to discount at present value are consumer, concessionaires, permissionaires and clients. The <ompany calculated the present value for balances with payment terms over 1H0 days. The discount rate used by 9anagement for the discount at present value of these items is approximately 12.0), similar to the <ompany5s funding cost and the financial charges collected from its clients. Interest rates accumulated in a sales transaction are determined upon initial recording of transaction and are not subse?uently ad4usted. u7 "dded value statement The <ompany prepared individual and consolidated added value statements 6'T"7 in the terms of the technical pronouncement <(< 02 B "dded Talue !tatement, which are presented as an integral part of the financial statements under $0 &""( applicable to publicly1held companies, whilst they represent, for I-0!, additional financial information.
58
v7 0ules and interpretations effective as of /anuary 1, 2013 I-0! 10 1 <(< 33 6037 1 <onsolidated -inancial !tatements 1 replaces the parts of I"! 2L B <onsolidated and !eparate -inancial !tatements that deal with consolidated financial statements. !I<112 B <onsolidation B !pecial (urpose #ntities was excluded with the issue of I-0! 10. "ccording to I-0! 10, there is only one consolidation basis, that is, control. I-0! 10 also includes a new definition of control. 9anagement did not identify impacts arising from this new rule. I-0! 11 1 <(< 12 6027 1 /oint "rrangements B replaces I"! 31 and establishes how 4oint arrangements should be classified in the financial statements. In accordance with the rule, the structure of a 4oint arrangement is no longer the main factor to determine the type of business and, conse?uently, the respective accounting. /oint ventures will be accounted for under the e?uity method and the proportionate consolidation method will no longer be permitted. The <ompany no longer proportionally consolidates its direct and indirect 4ointly1 controlled entities 0enova #nergia, &uanhPes #nergia, #$., .ightger, "xxiom, "ma%Snia #nergia and #1(ower as of /anuary 1, 2013. These changes did not have an impact on the <ompany5s net incomeD however, there were changes to the individual lines in the consolidated statement of income against the e?uity income and a reduction in consolidated assets and liabilities against an increase in investments, as shown below. There was also an impact between lines in the consolidated statements of cash flows and value added. The comparative periods were restated, as shown in items 6i7 through 6vii7 of this note. I-0! 12 1 <(< E, 1 'isclosure of Interests in @ther #ntities B is a disclosure rule applicable to entities with interests in subsidiaries, 4oint arrangements, associates andMor unconsolidated structured entities. In general, disclosure re?uirements under I-0! 12 are more comprehensive than the current rules. The result is a more comprehensive information disclosure for 4ointly1controlled entities, included in note 11. I-0! 13 1 <(< E3 B -air Talue 9easurement B presents a single source of guidance for fair value measurements and disclosures. The rule defines the fair value, presents a structure for measurement and re?uired disclosure. 9anagement did not identify relevant impacts from the adoption of this new rule. <hanges to I"! 1 1 <(< 236017 1 (resentation of Items of @ther <omprehensive Income B allow the presentation of the income statement and other comprehensive income in a single statement or in two separate and consecutive statements. +owever, the changes to I"! 1 re?uire additional disclosures in the section of other comprehensive income so that other comprehensive income items are grouped into two categoriesA 6a7 items that will not be subse?uently reclassified in the income statementD and 6b7 items that will be subse?uently reclassified in the income statement in accordance with certain conditions. 9anagement did not identify relevant impacts from the adoption of this new rule. I"! 12 6revised in 20117 1 <(< 336017 1 #mployee $enefits B they change the accounting of the defined benefit plans, includingA a7 the elimination of the =corridor approach>D b7 the immediate recognition of the cost of past services in the income statement c7 the
59
recognition of actuarial gains and losses in other comprehensive income, as incurredD and d7 the replacement of interest expenses and the expected returns on the plan5s assets by a net interest amount, calculated through the application of the discount rate to the net defined benefit assets or liabilities. "s the <ompany already immediately recogni%ed actuarial gains and losses in other comprehensive income and there were no significant differences in the expected rates of return on assets and the discount rates that could impact the financial information, the only impact was a reclassification of retained earnings to other comprehensive income under e?uity, as the <ompany opted for not transferring the amounts recorded in other comprehensive income in e?uity. The comparative periods were restated, as shown in item 6i7 through 6vii7 of this note. I"! 2L 6revised in 20117 1 <(< 3, 6027 1 !eparate -inancial !tatements B reflects changes in the accounting of non1controlling interest and deals mainly with the accounting of changes in interests in subsidiaries after control is obtained, the accounting of the loss of control in subsidiaries and the allocation of income or loss to controlling and non1controlling interests in a subsidiary. 9anagement did not identify relevant impacts from the adoption of this new rule. I"! 2H 6revised in 20117 1 <(< 1H 6027 1 Investments in "ssociates and /oint Tentures 6ii7A The changes introduced to I"! 2H were intended to clarify thatA 6i7 an investment in an associate must be treated as a single asset for impairment testing purposes in accordance with I"! 33 B <(< 01 6017 B Impairment of "ssetsD 6ii7 any impairment loss to be recogni%ed must not be allocated to specific assets 6specifically goodwill7D and 6iii7 impairment reversals are recorded as an ad4ustment to the associate5s boo* value provided that and to the extent that the recoverable amount of the investment increases. 9anagement did not identify relevant impacts from the adoption of this new rule. <hanges to I-0! L 1 <(< E0 6017 1 @ffsetting -inancial "ssets and -inancial .iabilities 1 introduce new disclosure re?uirements for financial assets and financial liabilities which are offset in the balance sheet. 9anagement did not identify relevant impacts from the adoption of this new rule. The adoption of the new rules 6I-0! 11 and I"! 127 as of /anuary 1st, 2013, as established in <(< 23 6I"! H7 B "ccounting (olicies, <hanges in "ccounting, #stimates and #rrors, impacted the balances as at /anuary 1, 2012, as well as profit or loss and the statements of cash flows and value added from /anuary 1st, 2012, which were duly ad4usted for comparative purposes in these financial statements, as shown below. In addition to these reclassifications, 9anagement decided to present (I! and <@-I8! tax credits on purchased energy as a reduction of expenses with purchased energy, instead of presenting it as a reduction of (I! and <@-I8! taxes on revenue and presenting the provision for success fees as =provisions>, instead of as >other debits>. These reclassifications were made to align these presentation criteria with the best practices of sector companies.
60
i.
<onsolidated !tatement of -inancial (osition as at 'ecember 31st, 2012.
ASSE&S <ash and cash e?uivalents 9ar*etable securities <onsumers, concessionaires, permissionaires and clients Inventories Taxes and contributions Income tax and social contribution (repaid expenses 0eceivables from services rendered 0eceivables from swap transactions @ther receivables &O&AL C:++E8& ASSE&S <onsumers, concessionaires, permissionaires and clients Taxes and contributions 'eferred taxes <oncessionsQ financial assets 'eposits related to litigation 0eceivables from swap transactions @ther receivables Investments (roperty, plant and e?uipment Intangible assets &O&AL 8O8-C:++E8& ASSE&S &O&AL ASSE&S
4-.,4.-/4Pu%lishe* 3LL,30L 1,,233 1,EE3,1L1 30,3,, 122,1H2 11,332 2,E23 E3,1,E 3,,0L0 1LE,HL0 -.,,3.12, 2H2,,,3 11H,HLH H30,233 1,,L3,3E2 22E,331 EL0 21,21, 21,H,, 2,220,,3E E,01L,0,L 0.,31.3/3 44.1-2.514
+eclassifications>4@ 61EL,2,17 1 6E,,H37 6L7 62,12L7 6E,2327 6EL27 63,2H37 1 6H,1,27 >414.511@ 612L7 1 62007 1 6,,H7 1 61H,E227 E3,,E2, 6,H,,3027 623H,E127 >6/1.561@ >510.4-6@
+eclassifications>,@ 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 -
4-.,4.-/4+estate* 230,3,3 1,,233 1,EE1,,HH 30,3EH 123,2H, 3,L30 1,2,E E2,1L1 3,,0L0 133,L1H -.421.432 2H2,E22 11H,HLH H30,033 1,,L3,3E2 22E,0L3 EL0 2,LH3 ,,L,3,0 1,33,,2,, 3,LEH,33H 3.03/.-24 44.461.661
61
LIA)ILI&IES !uppliers Taxes and contributions Income tax and social contribution .oans, financing and financial charges 'ebentures and financial charges (ayable swap transactions 'ividends and interest on e?uity payable #stimated liabilities 0egulatory charges (ost1employment benefits @ther payables &O&AL C:++E8& LIA)ILI&IES .oans, financing and financial charges 'ebentures and financial charges (ayable swap transactions Taxes and contributions 'eferred taxes (rovisions (ost1employment benefits @ther payables &O&AL 8O8-C:++E8& LIA)ILI&IES
4-.,4.-/4Pu%lishe* H31,H23 H,,L21 ,0,3,3 321,010 1,1,H32 1,,2L LE,L22 EH,,LH 111,L13 113,10L 123,032 -./32.224 2,200,L21 1,222,E2, E,,32 12,,L,1 320,22E ,H3,1L1 1,2,E,331 132,L02 2.246.--1 4-.,4.-/4Pu%lishe* 2,22,,H22 2,3,,3, 21,LL0 E,1,,,3 1 1 ,./-5.23, 44.1-2.514
+eclassifications>4@ 6EL,3,E7 63,E3H7 1 6EH,0317 633,0327 1 1 61,L,27 1 1 62,3227 >4,5.01,@ 62H0,2327 63L,23E7 1 1 622,3127 6127 1 63,3E07 >66,.454@
+eclassifications>,@ 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 22,HLL 1 622,HLL7 -
4-.,4.-/4+estate* H1E,E32 H2,3,3 ,0,3,3 3E2,2E2 11H,L23 1,,2L LE,L22 E3,H23 111,L13 113,10L 120,L33 4.05/.233 1,220,EH2 1,H,,,231 E,,32 12,,L,1 22L,20, 303,022 1,2,E,331 103,EH, 2.414./12 4-.,4.-/4+estate* 2,22,,H22 2,3,,3, 21,LL0 E,1,,,3 61L1,22L7 1L1,22L ,./-5.23, 44.461.661
S=A+E=OL$E+SJ E7:I&D <apital (rofit reserves (roposed additional dividends #?uity valuation ad4ustments @ther comprehensive result 0etained earnings &O&AL S=A+E=OL$E+SJ E7:I&D &O&AL LIA)ILI&IES A8$ S=A+E=OL$E+SJ E7:I&D
+eclassifications 1 1 1 1 1 1 >510.4-6@
+eclassifications>-@ 1 1 1 1 61L1,22L7 1L1,22L -
62
617 627
These reclassifications result from the adoption of I-0! 11 1 <(< 12 6027. These reclassifications result from the adoption of I"! 12 6017 1 <(< 33 6017. 637 This reclassification refers to the provision for success fees, which moved from =other payables> to =provisions>.
ii.
<onsolidated !tatement of Income, year ended 'ecember 31st, 2012.

4-.,4.-/4Pu%lishe* 8E& OPE+A&I8( +EEE8:E COS& O; OPE+A&IO8S #lectric power purchased for resale (ersonnel 9aterial @utsourced services 'epreciation and amorti%ation <onstruction costs @ther (+OSS P+O;I& OPE+A&I8( EKPE8SES !elling expenses &eneral and administrative expenses @ther revenues @ther expenses E7:I&D I8 &=E EA+8I8(S O; S:)SI$IA+IES EA+8I8(S )E;O+E &=E ;I8A8CIAL +ES:L& A8$ &AKES ;I8A8CIAL +ES:L& 0evenues #xpenses +ES:L& )E;O+E I8COME &AK A8$ SOCIAL CO8&+I):&IO8 <urrent income tax and social contribution 'eferred income tax and social contribution 8E& I8COME ;O+ &=E ;ISCAL DEA+ 1.24,./02 >5.053.0/1@ 6E,,3E,1,37 61H0,HLH7 622,1EL7 61H,,2,H7 631E,2L17 6332,3227 6,2,1LH7 4.256.430 >555./31@ 63H2,3E37 6,EH,3,07 E3H,1H2 632,,L37 >4.-33@ 4./01.346 >605.21,@ 203,2E2 6322,3227 2/-.464 6102,03E7 632,1HE7 6-,.0-, +eclassification >4@ +eclassification>6@ 4-.,4.-/4+estate* 1.43-.,2/ >5.554.6/1@ 6E,1E,,1127 6122,2H37 622,1EL7 6132,3H27 631E,2L17 6332,3227 63H,1H37 4.2,/.05, >52,./-3@ 63H1,,2E7 6,3,,10E7 E1,,210 632,3107 -4.556 4./30.610 >604./06@ 122,,0H 63H3,3027 503.,35 611,,00H7 6,2,E,E7 6-,.0-,
>5,.630@ ,/.-5, 11,L2E 61H,E0,7 1 22,H32 1 1 13,22, >-,.-,2@ >1.064@ H22 13,2E3 622,2L27 233 --.36>3.,,5@ 6.510 611,EE17 13,020 >,.152@ 6,,2LE7 2,L30 -
>,11.-61@ ,11.-61 3LL,2EL 1 1 1 1 1 1 1 1 1 1 1 1 1 1 -
617 6E7
These reclassifications result from the adoption of I-0! 11 1 <(< 12 6027. 0eclassification of (I! M <@-I8! tax credits in the purchase of energy.
63
iii.
<onsolidated !tatement of <ash -lows, year ended 'ecember 31st, 2012.

-/4Pu%lishe* 8et cash from operating acti9ities Cash generate* %# operations 8et income before income tax and social contribution "llowance for doubtful accounts 'epreciation and amorti%ation .oss 6gain7 from the sale of intangible asset Mproperty, plant and e?uipment -oreign exchange and monetary losses 6gains7 from financial activities (rovisions for contingencies and 4udicial deposits Mrestatement "d4ustment to present value and prepayment of receivables #xpenses with interest on loans <harges and monetary variation of post1employment obligations !wap variation #?uity in the earnings of subsidiaries 0emuneration of the concessionQs financial assets 'ilution gains at 0enova >Increase@L$ecrease in Assets an* Lia%ilities 9ar*etable securities <onsumers, concessionaires and permissionaires Taxes and contributions Inventories 0eceivables from services rendered (repaid expenses 'eposits related to litigation @ther !uppliers #stimated liabilities Taxes and contributions 0egulatory charges (rovisions (ost1employment benefits @ther liabilities Interests paid Income tax and social contributions paid 8et cash from in9esting acti9ities 0evenue from the sale of intangible asset "c?uisition of property, plant and e?uipment "?uisition of intangible assets Investment ac?uisitions -inancial investments 8et cash from dilution at 0enova 8et cash generate* %# >use* in@ financing acti9ities 'ividends and interest on e?uity paid .oans, financing and debentures "morti%ation of loans, financing and debentures 8et increase >*ecrease@ in cash an* cash eGui9alents <ash and cash e?uivalents at the beginning of fiscal year <ash and cash e?uivalents at the end of fiscal year 652.021 4.2//.5/6 302,1E1 2H2,302 3,H,E33 13,H3, 21,,3E 2,3,02L E0,22H 330,123 120,032 1,02E 1,2HH 6E0H,1,H7 61,,2127 >4.46,.5,1@ HL1 63LL,H1H7 62,,,2H,7 62,22,7 3H,H10 1H 6,L,2H17 6EL,E,07 3H,,32 1,200 13E,133 63E07 6H2,LHE7 6L3,3,27 6,3,,007 6331,2,07 6LE,H327 >0,5.-5-@ E,HH1 6300,23E7 6332,,207 633,31H7 6L,2337 3E,33, 3,.,66 6E2,,1127 1,320,2E3 6H12,EH37 >,06.064@ LL2,,EH 3LL,30L +eclassifications>4@ -/4+estate* 564.424 4.552.351 ,2H,3H, 2H2,302 3E2,3E2 20,HH1 20,2H2 2,0,233 E0,22H 31L,213 120,032 61E,E327 621,,,E7 6E0H,1,H7 1 >4./45.202@ HL1 63L2,E,H7 611E,0E07 62,21H7 E0,3H2 2E2 6,2,H,,7 H,1H2 12E,02H 2L3 3E,LL1 63E07 6H3,03H7 6120,,327 63H,3017 63,H,2EE7 6LE,H327 >336.350@ 1 611E,3237 63HH,,327 6L3,32H7 6L,2337 1 >13.644@ 6E2,,1127 1,11L,33H 6LL0,3307 >6--.4/0@ 3,2,E3, 230,3,3
36.406 >6,.261@ 63,L,37 1 6H,L217 L,013 61,2H27 62,0217 1 612,2H07 1 61,,,337 622,HE27 1 1,,212 4-1.364 1 ,,330 1E1,2E, L 1,,L2 231 62,,LE7 ,,,332 ,,,,33 622E7 632,3227 1 62HE7 6EL,2107 61,,1017 3,003 1 5/.,0, 6E,HH17 1H3,23H 623,0E27 6E0,3107 1 63E,33,7 >424.155@ 1 6203,,LH7 E1,H23 >-1.423@ 6120,0H37 61EL,2,17
617
These reclassifications result from the adoption of I-0! 11 1 <(< 12 6027.
64
iv.
<onsolidated !tatement of Talue "dded, year ended 'ecember 31st, 2012.

-/4Pu%lishe* +e9enues !ale of goods, products and services 0evenue related to the construction of own assets "llowanceM0eversal of allowance for doubtful accounts Inputs acGuire* from thir* parties <ost of products, goods and services sold 9aterial, energy, outsourced services and other (ross 9alue a**e* +etentions 'epreciation and amorti%ation 8et 9alue a**e* pro*uce* Ealue a**e* recei9e* in transfer #?uity in the earnings of subsidiaries -inancial revenues &otal 9alue a**e* to *istri%ute $istri%ution of 9alue a**e* Personnel 'irect remuneration $enefits &overnment !everance -und for #mployees 6-&T!7 @ther &a"es. fees an* contri%utions -ederal !tate 9unicipal Ealue *istri%ute* to pro9i*ers of capital Interest 0ental @ther Ealue *istri%ute* to sharehol*ers 'ividends and interest on e?uity 0etained earnings 44.-14.301 10,L0L,0E3 HEL,E,3 62H2,3027 >5.516.001@ 6E,,3E,1,37 61,0E0,HEE7 5.202.0// >,53.6,,@ 63,H,E337 5.,,3.621 -/-.224 61,2HH7 203,2E2 5.564.4-3 5.564.4-3 ,-,.016 2EL,3L2 E3,222 12,2,2 10,0,1 6./4/.4,5 1,33H,2H1 2,332,E2, 2,E22 13,./02 L00,,10 31,112 21,E3L 6-,.0-, 2,3,,EH 13L,3L, +eclassifications>4@ +eclassifications>6@ -/4+estate* 44./,1.2310,3,0,232 332,322 62H2,3027 >5./-5.420@ 6E,1E,,1127 6HH0,0,L7 2./4-.54, >,60.26-@ 63E2,3E27 5.22-.314 -46./221,,,E 122,,0H 5.312.0,, 5.312.0,, ,/6.420 22L,HLE E3,222 12,2,2 10,0,1 6.,34.235 2,010,EHH 2,332,E2, H,LL2 121.452 3HE,,L0 31,112 21,E3L 6-,.0-, 2,3,,EH 13L,3L,
>-,6.-45@ 6,3,0HE7 61LH,1317 1 41-.534 11,L2E 130,LHL >24.2,6@ 3.104 H,L21 >5-.36,@ 44.6/4 22,HE2 611,EE17 >64.66-@ >64.66-@ >40.3/5@ 612,H0,7 1 1 1 >5.201@ 6,,0E07 1 63,L7 >45.06/@ 61,,2E07 1 1 1 1
1 1 1 ,11.-61 3LL,2EL 1 ,11.-61 1 ,11.-61 1 1 ,11.-61 ,11.-61 1 1 1 1 ,11.-61 3LL,2EL 1 1 1 1 1 1 1
617 6E7
These reclassifications result from the adoption of I-0! 11 1 <(< 12 6027. 0eclassification of (I! M <@-I8! tax credits in the purchase of energy.
65
v.
<onsolidated !tatement of -inancial (osition, as at /anuary 1st, 2012.

ASSE&S <ash and cash e?uivalents 9ar*etable securities <onsumers, concessionaires, permissionaires and clients Inventories Taxes and contributions Income tax and social contribution (repaid expenses 0eceivables from services rendered 0eceivables from swap transactions @ther receivables &O&AL C:++E8& ASSE&S <onsumers, concessionaires, permissionaires and clients Taxes and contributions 'eferred taxes (repaid expenses <oncessionsQ financial assets 'eposits related to litigation 0eceivables from swap transactions @ther receivables Investments (roperty, plant and e?uipment Intangible assets &O&AL 8O8-C:++E8& ASSE&S &O&AL ASSE&S 4-.,4.-/44 Pu%lishe* +eclassifications>4@ +eclassifications /4./4.-/4+estate*
LL2,,EH H,1L1 1,3H3,320 2L,E30 13E,,,1 20,2EL 2,1H0 HE,23E 3,H01 1L3,,,0 -.234.1222H,,3H 2,,322 H33,E11 233 3,3,EL3 23H,,0, L,E L,2L2 ,E,0H3 1,2H,,H33 E,1LE,200 3.,10.,26 44./24.4-2
6120,0H37 1 623H7 1 61,2137 62L7 63337 62,E0E7 1 63,L137 >4-3.441@ 6E317 1 1 123 1 63,3027 1 612L7 E0H,2H0 63HE,L,27 6223,33E7 >-11.431@ >6/5.,/6@
1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 -
3,2,E3, H,1L1 1,3H3,3H2 2L,E30 133,33, 20,H,0 1,H1L H2,,30 3,H01 132,H3E -.55,.265 22H,0LL 2,,322 H33,E11 3H3 3,3,EL3 23E,H23 L,E L,H,2 E32,333 1,301,0LE 3,HLH,233 3.4/-.411 4/.255.3--
LIA)ILI&IES !uppliers Taxes and contributions Income tax and social contribution .oans, financing and financial charges 'ebentures and financial charges (ayable swap transactions 'ividends and interest on e?uity payable #stimated liabilities 0egulatory charges (ost1employment benefits @ther payables &O&AL C:++E8& LIA)ILI&IES .oans, financing and financial charges 'ebentures and financial charges (ayable swap transactions Taxes and contributions 'eferred taxes (rovisions (ost1employment benefits @ther payables &O&AL 8O8-C:++E8& LIA)ILI&IES
4-.,4.-/44 Pu%lishe*
+eclassifications>4@ +eclassifications>,@
/4./4.-/4+estate*
L,L,1,H HE,3E2 E0,2L2 30E,,,E 213,LE0 LHL L3,LE1 EL,3L2 112,3,3 H0,,2, 22L,1,E 4.06-./45 1,H,3,LEH 1,L20,132 2L3 200,233 3E2,321 ,1,,3LH 1,020,3HE 1,3,E11 5.061.-3,
6E,E107 61,2007 6137 6E1,L107 1 1 1 61,,227 1 1 612,2237 >24./33@ 62EE,,HE7 1 1 1 622,3327 1 1 1 >,66.-42@
1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 23,131 1 623,1317 -
L,2,LEH H3,1E2 E0,2,2 232,HEE 213,LE0 LHL L3,LE1 E,,H,0 112,3,3 H0,,2, 21E,22H 4.33/.0-1 1,302,13E 1,L20,132 2L3 200,233 2E2,L,2 ,3H,H32 1,020,3HE 130,2,0 5.2/,./21
S=A+E=OL$E+SJ E7:I&D
4-.,4.-/44 Pu%lishe*
+eclassifications
+eclassifications>-@
/4./4.-/4+estate*
<apital (rofit reserves (roposed additional dividends #?uity valuation ad4ustments @ther comprehensive result 0etained earnings 6accumulated losses7 &O&AL S=A+E=OL$E+SJ E7:I&D &O&AL LIA)ILI&IES A8$ S=A+E=OL$E+SJ E7:I&D
2,22,,H22 3E1,32, 1H1,,01 EL2,3,3 1 6E2,,E37 ,.414.3-3 44./24.4-2
1 1 1 1 1 1 >6/5.,/6@
1 1 1 1 632,2LH7 32,2LH -
2,22,,H22 3E1,32, 1H1,,01 EL2,3,3 632,2LH7 62,,3H7 ,.414.3-3 4/.255.3--
These reclassifications result from the adoption of I-0! 11 1 <(< 12 6027. These reclassifications result from the adoption of I"! 12 6017 1 <(< 33 6017. 637 This reclassification refers to the provision for success fees, which moved from =other payables> to =provisions>.
627
617
66
vi.
(arent <ompany !tatement of -inancial (osition, as at 'ecember 31st, 2012.

ASSE&S <ash and cash e?uivalents Income tax and social contribution (repaid expenses 'ividends and interest on e?uity receivable 0eceivables from services rendered @ther receivables &O&AL C:++E8& ASSE&S 'eposits related to litigation Investments (roperty, plant and e?uipment &O&AL 8O8-C:++E8& ASSE&S &O&AL ASSE&S 4-.,4.-/4Pu%lishe* E,,E32 3,H,H 121 12,210 1EH 3,33, 15.564 2H2 3,031,033 3L2 ,./,4.006 ,.4/1.5,5 +eclassifications 1 1 1 1 1 1 1 1 1 4-.,4.-/4+estate* E,,E32 3,H,H 121 12,210 1EH 3,33, 15.564 2H2 3,031,033 3L2 ,./,4.006 ,.4/1.5,5
LIA)ILI&IES !uppliers Taxes and contributions Income tax and social contribution 'ividends and interest on e?uity payable #stimated liabilities (ost1employment benefits @ther payables &O&AL C:++E8& LIA)ILI&IES (ost1employment benefits @ther payables &O&AL 8O8-C:++E8& LIA)ILI&IES S=A+E=OL$E+SJ E7:I&D <apital (rofit reserves (roposed additional dividends #?uity valuation ad4ustments @ther comprehensive result 0etained earnings 6accumulated losses7 &O&AL S=A+E=OL$E+SJ E7:I&D &O&AL LIA)ILI&IES A8$ S=A+E=OL$E+SJ E7:I&D
627
4-.,4.-/4Pu%lishe* E,H 1,3E0 2 LE,L22 322 11 3,,1E 3/.3/0 1E2 201 4./6,
+eclassifications>-@ 1 1 1 1 1 1 1 1 1 -
4-.,4.-/4+estate* E,H 1,3E0 2 LE,L22 322 11 3,,1E 3/.3/0 1E2 201 4./6,
2,22,,H22 2,3,,3, 21,LL0 E,1,,,3 1 1 ,./-5.23, ,.4/1.5,5
1 1 1 1 61L1,22L7 1L1,22L -
2,22,,H22 2,3,,3, 21,LL0 E,1,,,3 61L1,22L7 1L1,22L ,./-5.23, ,.4/1.5,5
These reclassifications result from the adoption of I"! 12 6017 1 <(< 33 6017.
67
vii.
(arent <ompany !tatement of -inancial (osition, as at /anuary 1st, 2012.
ASSE&S <ash and cash e?uivalents Income tax and social contribution (repaid expenses 'ividends and interest on e?uity receivable 0eceivables from services rendered @ther receivables &O&AL C:++E8& ASSE&S 'eposits related to litigation Investments (roperty, plant and e?uipment &O&AL 8O8-C:++E8& ASSE&S &O&AL ASSE&S
4-.,4.-/44 Pu%lishe* ,,,0,L 3,32, 1H2 LH,,10 1,0 13,L33 454./51 21, 3,10,,E,3 3L2 ,.4/2.,6, ,.-51.6//
+eclassifications 1 1 1 1 1 1 1 1 1 -
/4./4.-/4+estate* ,,,0,L 3,32, 1H2 LH,,10 1,0 13,L33 454./51 21, 3,10,,E,3 3L2 ,.4/2.,6, ,.-51.6//
LIA)ILI&IES !uppliers Taxes and contributions Income tax and social contribution 'ividends and interest on e?uity payable #stimated liabilities @ther payables &O&AL C:++E8& LIA)ILI&IES
4-.,4.-/44 Pu%lishe* 12L H,211 2 L3,LE1 233 2,EHH 35.51-
+eclassifications>-@ 1 1 1 1 1 1 -
/4./4.-/4+estate* 12L H,211 2 L3,LE1 233 2,EHH 35.51-
S=A+E=OL$E+SJ E7:I&D <apital (rofit reserves (roposed additional dividends #?uity valuation ad4ustments @ther comprehensive result 0etained earnings 6accumulated losses7 &O&AL S=A+E=OL$E+SJ E7:I&D &O&AL LIA)ILI&IES A8$ S=A+E=OL$E+SJ E7:I&D 2,22,,H22 3E1,32, 1H1,,01 EL2,3,3 1 6E2,,E37 ,.414.3-3 ,.-51.6// 1 1 1 1 632,2LH7 32,2LH 2,22,,H22 3E1,32, 1H1,,01 EL2,3,3 632,2LH7 62,,3H7 ,.414.3-3 ,.-51.6//
627
These reclassifications result from the adoption of I"! 12 6017 1 <(< 33 6017.
w7 0ules, interpretations and amendment issued and not yet effective I-0! 2 1 -inancial Instruments 6i7 B introduces new re?uirements for the classification, measurement and write1off of financial assets and financial liabilities. The most significant effect of the application of this new rule refers to the accounting of the changes in the fair value of a financial liability 6designated at fair value through profit or loss7 attributable to the changes in that liability5s credit ris*. <onse?uently, the change in the fair value of the financial liability attributable to the changes in that liability5s credit ris* is recogni%ed under =@ther comprehensive income> unless the recognition of the effects of the changes in the liability5s credit ris* in =@ther comprehensive income> causes or increases the accounting mismatch in the income statement.
68
I"! 32M<(< 32 6ii7 B -inancial InstrumentsA 'isclosures B @ffsetting "ssets and .iabilities B brings additional clarifications to the application guidance in I"! 32 on re?uirements to offset financial assets and financial liabilities in the statement of financial position. I-0I< 21 B .evies 6ii7 B provides guidance on when to recogni%e a liability for a levy imposed by a government, both for levies that are accounted for in accordance with I"! 3L (rovisions, <ontingent .iabilities and <ontingent "ssets and those where the timing and amount of the levy is certain. I"! 33 B Impairment of assets 6<(< 017 6ii7 B provides guidance on the disclosure of recoverable amounts of non1financial assets. I"! 32 B Impairment of assets 6ii7 B provides additional guidance by clarifying that there is no need to discontinue hedge accounting if the derivative instrument is renewed, provided that certain criteria are met. "mendments to I-0! 10, I-0! 12, and I"! 2L 6ii7 B the amendments to I-0! 10 define an investment entity and re?uire that the reporting entity that fits the definition of investment entity does not consolidate its subsidiaries, but, instead, measures its subsidiaries at their fair value through profit or loss in their consolidated and separate financial statements. In order to be characteri%ed as an investment entity, a reporting entity has toA obtain funds from one or more investors for the purpose of providing those investors with investment management servicesD commit to its investors that its business purpose is to invest funds solely for returns from capital appreciation andMor investment incomeD and measure and evaluate the performance of substantially all of its investments on a fair value basis.
There were changes due to I-0! 12 and I"!, which introduced new disclosure re?uirements for investment entities. The <ompany analy%ed the impact of these changes on the financial statements and did not identify any material impacts on the financial statements.
6i7 #ffective for fiscal years beginning on or after /anuary 1, 201,. 6ii7 #ffective for fiscal years beginning on or after /anuary 1, 201E.
69
4) <"!+ "8' <"!+ #C IT".#8T!

Parent Compan# 4-.,4.-/4, 9oney available !hort1term financial investments $an* deposit certificate 6<'$7 &O&AL 23,,3L -2.3/E,,232 65.620 E2,,22H 562.6-0 1,0,,20 -,/.,52 23, 4-.,4.-/4200 Consoli*ate* 4-.,4.-/4, ,0,E31 4-.,4.-/4+estate* L2,H33
The short1term investments are highly li?uid and convertible into *now amounts cash and are sub4ect to a floating rate represented by transactions purchased from financial institutions trading in the domestic financial mar*et, at mar*et terms and rates. These short1term investments have a daily repurchase commitment by the counterparty financial institution 6the repurchase rate is previously agreed upon by the parties7, and yield according to the variation of the interban* deposit rate 6<'I7, with immaterial loss of income in case of early redemption. The average yield of these investments is 22.H) of the <'I 62H.2) of the <'I on 'ecember 31, 20127, The <ompanyQs exposure to interest rate ris*s and a sensitivity analysis of financial assets and liabilities are reported in 8ote 3E. /) 9"0`#T"$.# !#< 0ITI#! These papers involve short1term ban* deposit certificates 6<'$7 in the amount of 0G1,2EE,000 60G1,,233 on 'ecember 31, 20127 in the consolidated financial statements. They are represented byA 6i7 surety bonds pledged in power auctions, 6ii7 funds allocated to settling the debt contract related to post1employment benefits, 6iii7 proceeds from the sale of assets that were held for reinvestment in the electric grid system, 6iv7 investments to mature within three months or longer with loss of value in case of early redemption. The average yield of these investments is 22.H) of the <'I 6100.2) of the <'I on 'ecember 31, 20127.
70
0) <@8! 9#0!, <@8<#!!I@8"I0#!, (#09I!!I@8"I0#! "8' <.I#8T!

Consoli*ate* 4-.,4.-/4, Current 8on-current &otal Current 4-.,4.-/4- - +estate* 8on-current &otal
$illed sales nbilled sales 'ebt payment by installments !ales within the scope of <<## !upply and charges related to use of electric networ* @ther receivables
1,02L,2,2 31L,00L 2L,20H 12,13E 1,3,133 1,210 4.236.016
1 1 1,L,L2H 1 1 ,1,313 -/0.646 1 -/0.646
1,02L,2,2 31L,00L 2,,,003 12,13E 1,3,133 ,2,H23 4.306.,33 6E31,,317 4.6,-.3-1
1,E,,,H,3 E00,23E 1E3,333 LH0 133,0E2 2E1 -.42,.60, 6L21,20,7 4.664.533
1 1 23,,,02 1 1 23,22L -30.6-0 1 -30.6-0
1,E,,,H,3 E00,23E E0H,H3H LH0 133,0E2 2E,13H -.65-.0-6L21,20,7 4.1,4./41
617 "llowance for doubtful accounts &O&AL
6E31,,317 4.--,.64,
"n allowance for doubtful accounts was set up based on certain premises and in an amount deemed sufficient by 9anagement to meet any asset reali%ation losses. In 2013, bad debts were written1off in the amount of 0GE1H,22H 60GE,3,102 in 20127, mainly related to bills overdue for a long time. The write offs were reali%ed against allowance for doubtful accounts already recorded, thus, not impacting the net income for the year. The balances of debt repayment facilities were ad4usted to their present value, as applicable. The present value is determined for each relevant consumer debt renegotiation 6debt repayment facilities7 based on such interest rate as will reflect the term and ris* associated with each individual transaction, on average 1) per month. @utstanding balances and receivables in connection with invoiced electric power sales and also debt repayment programs are summari%ed as followsA
O9er*ue %alances )ILLE$ SALES A8$ I8S&ALLME8& PADME8& 0esidential Industrial <ommercial 0ural (ublic sector (ublic lighting (ublic utility &O&AL Maturing %alance O9er*ue up to 0/ *a#s 12H,E2E 13,E02 EE,H1H 2L, 30,E,0 2,L03 1,LE2 221,201 O9er*ue o9er 0/ *a#s 123,2E2 121,,3L 2L2,,,1 ,33 100,EL2 1E,3E2 12,,23 3,3,23L 4-.,4.-/4,
&O&AL 4-.,4.-/4+estate* LEH,,3, 1,,,23H ,EL,LL0 1,H1H 22L,313 E2,E11 1E0,HE3 1,H3E,321
Allowance for *ou%tful accounts 4-.,4.-/4, 610E,2H37 63H,1E37 6230,2227 6,127 6E,,0317 6L,0,L7 6E,2037 6E31,,317 4-.,4.-/4+estate* 63L3,2H27 63L,03H7 62,3,0327 63217 6E3,1EE7 611,0007 6,17 6L21,20,7
1L2,1H1 21,LHE 13,,200 1,0H0 LL,3,L 13,22, 1,,223 ELE,120
E3E,32E 1,3,L30 EH2,,32 1,HHH 20H,,L2 31,2L3 22,,3, 1,3,2,2,H
71
<hanges in consolidated "llowance for 'oubtful "ccounts 1 (<.' in the fiscal yearsA
)ALA8CE O8 /4./4.-/4>305.6/5@ 62H2,3027 E,3,102 >1-4.0/5@ 61,L,HHE7 E1H,22H >624.524@
"dditionsM0eversals :rite1offs
)ALA8CE O8 4-.,4.-/4-
"dditionsM0eversals :rite1offs
)ALA8CE O8 4-.,4.-/4,
The <ompany5s exposure to credit ris*s related to consumers, concessionaires, permissionaires and clients is reported in 8ote 3E.
1) 0#<@T#0"$.# T"V#!
Parent Compan# 4-.,4.-/4, Current 4-.,4.-/4Current
I8COME &AK A8$ SOCIAL CO8&+I):&IO8 Tax credits "dvances &O&AL
2.663,EE2 1 2.66-
,.353 3,H32 12 ,.353
Consoli*ate* 4-.,4.-/4, Current 8on-current &otal Current 4-.,4.-/4- - +estate* 8on-current &otal
&AKES A8$ CO8&+I):&IO8S I<9! to offset (I! and <@-I8! to offset @ther I8COME &AK A8$ SOCIAL CO8&+I):&IO8 Tax credits "dvances &O&AL
4/5.3-4 L0,2L, 1,,LH2 12,L3E 55.46/ 2H,1L0 23,2L0 42/.024
33.111 HH,LLL 1 1 1 1 33.111
406.503 1,2,0,2 1,,LH2 12,L3E 1 55.46/ 2H,1L0 23,2L0 -60.1,3
402.035 1E1,132 33,HH2 1H,22L 2.1,/ 3,,11 212 -/,.145
443.313 11H,HLH 1 1 1 1 443.313
,45.32, 230,0EL 33,HH2 1H,22L 2.1,/ 3,,11 212 ,--.50,
72
2) '#-#00#' T"V#!
Consoli*ate* 4-.,4.-/4, I+LCSLL Assets "llowance for doubtful accounts (rovision for profit sharing (rovision for labor contingencies (rovision for tax contingencies (rovision for civil contingencies 0egulatory assets not recogni%ed under I-0! (ension plan complement 1 <T9 32,M12 @ther Tax losses !ocial contribution tax loss carryforwards 0emuneration of financial assets 'erivative financial instruments 'eemed cost 1 .ight #nergia (+OSS $E;E++E$ &AK ASSE&SL>LIA)ILI&IES@ 8et amount 8E& $E;E++E$ &AK ASSE&SL>LIA)ILI&IES@ 1,1,LE, 12,3,L ,E,3E3 L2,,EH ,3,EH3 12L,103 32,102 1L,L30 233,301 HH,203 1 1 1 H,3,2,H 6233,E237 2--.3,5 I+LCSLL Lia%ilities 1 1 1 1 1 1 1 1 1 1 612E,,337 6E3,3H37 6221,2117 6E,2,H337 233,E23 >--2.64/@ I+LCSLL 8et 1,1,LE, 12,3,L ,E,3E3 L2,,EH ,3,EH3 12L,103 32,102 1L,L30 233,301 HH,203 612E,,337 6E3,3H37 6221,2117 323,E2, 1 ,02.6-5 4-.,4.-/4- - +estate* I+LCSLL Assets 23H,EE0 3,20, 3E,0H1 32,L2H 32,,12 1E3,E23 10L,021 2,,E22 201,32E L,,,2H 1 1 1 223,L31 6133,L2H7 3,/./,, I+LCSLL Lia%ilities 1 1 1 1 1 1 1 1 1 1 613H,LL37 612,,H,7 6233,2L,7 6321,3337 133,L2H >--1.0/5@ I+LCSLL 8et 23H,EE0 3,20, 3E,0H1 32,L2H 32,,12 1E3,E23 10L,021 2,,E22 201,32E L,,,2H 613H,LL37 612,,H,7 6233,2L,7 302,12H 1 2/-.4-3
<hanges in deferred income tax for the fiscal years 2012 and 2013 are as followsA
)alance on /4./4.-/4+estate* ASSE&S "llowance for doubtful accounts (rovision for profit sharing (rovision for labor contingencies (rovision for tax contingencies (rovision for civil contingencies 0egulatory assets not recogni%ed under I-0! (ension plan complement 1 <T9 32,M12 @ther Tax losses !ocial contribution tax loss carryforwards &O&AL ASSE&S LIA)ILI&IES 0emuneration of financial assets 'erivative financial instruments 'eemed cost 1 .ight #nergia &O&AL LIA)ILI&IES 1 1 62E3,33,7 62E3,33,7 613H,LL37 612,,H,7 10,030 61EH,22H7 1 1 1 1 613H,LL37 612,,H,7 6233,2L,7 6321,3337 6,,,L337 623,H017 10,E,1 632,1137 1 1 213 213 612E,,337 6E3,3H37 6221,2117 6E,2,H337 22L,E2L 3,3L, ,0,,3H 33,23E 33,EH2 E3,H2, 12,2E, H,E02 211,,,H L2,1HL H33,2HL 6,H,2HL7 61L07 13,,E3 3,E2E 62LL7 22,,2H 313 E2,,,0 610,13E7 63,3,27 HH,HEE 1 1 1 1 1 1 23,E30 62,,,307 1 1 3L,230 23H,EE0 3,20, 3E,0H1 32,L2H 32,,12 1E3,E23 10L,021 2,,E22 201,32E L,,,2H 223,L31 6H3,32,7 3,1,2 62,L3H7 2,H20 63,0237 613,31L7 613,0227 610,,2E7 3L,222 13,3LL 6H1,L,17 1 1 1 1 1 1 6,E,H207 2,22, 62,LH,7 61,0027 6,,,L,27 1,1,LE, 12,3,L ,E,3E3 L2,,EH ,3,EH3 12L,103 32,102 1L,L30 233,301 HH,203 H,3,2,H +ecogni e* in the income statement +ecogni e* in the sharehol*ersJ eGuit# )alance on 4-.,4.-/4+estate* +ecogni e* in the income statement +ecogni e* in the sharehol*ersJ eGuit# )alance on 4-.,4.-/4,
In order to substantiate its deferred tax assets, the <ompany updated the feasibility analysis approved by the $oard of 'irectors and examined by the -iscal <ouncil considering reali%ations as of 'ecember 2013, which analysis is based on estimations prepared in 2013. The feasibility analysis indicates the balance will be recovered within eight years. $elow, a list of deferred tax asset estimated amounts per relevant year of reali%ation.
201E 201, 2013 201L 201H 2012 2020 2021 &O&AL (+OSS - CO8SOLI$A&E$ 2E1,3,3 1,H,2HH 111,LLL 133,2,2 H2,,23 LL,300 E2,E32 E,HH2 352.-53
73
@n 'ecember 31st, 2013, .ight !.". had an unrecogni%ed credit balance on accumulated tax losses and social contribution carryforwards amounting to 0GEE.E22 60G33,02, on 'ecember 31st, 20127, in view of uncertainties regarding its reali%ation.
3) <@8<#!!I@8!5 -I8"8<I". "!!#T!

These represent the amounts receivable at the end of concession from the granting authority, or any of its agents, by way of compensation for investments made and not recovered through services rendered related to subsidiary .ight !#!"Qs concession. #xecutive @rder no. ,L2M2012, converted into .aw 12,LH3M2013, determined that the calculation of the indemnification of financial assets, corresponding to the portions of investments made and not recovered through the provision of services related to the concession, will use the new replacement value 6=80T>7 methodology. The <ompany5s 9anagement believes that this fact changed the concession5s contractual conditions related to the way the <ompany is indemnified for investments in infrastructure related to the provision of the granted services, which were recogni%ed at their historical cost until fiscal year 2011. "s a result, on 'ecember 31st, 2013, the subsidiary .ight !#!" recorded an amount related to the difference between the new replacement value and the historical cost, through expected cash inflow, in the amount of 0G12E,L,0 60GE0H,1,H in 20127, in the income statement, in other operating revenues. The changes in the balances, net of special obligations, related to indemnifiable assets 6<oncession7 in fiscal years 2013 and 2012 are as followsA
)ALA8CE O8 /4./4.-/4"dditions
6a7
252.61, 320,E30 E0H,1,H

6b7
8ew 0eplacement Talue 680T7 0eclassification of "8##. 0esolution EL2M12 )ALA8CE O8 4-.,4.-/4"dditions
6a7
11H,2HH 4.51,.,60 12,,2HH 12E,L,0 EE,0HL 611,2EH7 4.0-2.--2
8ew 0eplacement Talue 680T7 "d4ustment to 8ew 0eplacement Talue 680T7 :rite1offs )ALA8CE O8 4-.,4.-/4,
6a7 6b7
Transfer resulting from the bifurcation of assets after start1up, pursuant to I-0I< 12MI<(< 01 6see note 137. 0eclassification related to "8##. resolution ELEM12 6see note 137
74
10) @T+#0 0#<#IT"$.#!

Consoli*ate* 4-.,4.-/4, Current "dvances to suppliers and employees "ccount receivable from the sale of property (ublic lighting fee #xpenditures to refund !ubsidy to low1income segment <'# subsidy 6a7 "ssets and rights allocated for sale @ther 6b7 &O&AL 32,013 12,0E3 ,H,E2E 3E,2E2 3,2LH 33,3H0 1 30,303 -46.-02 8on-current 1 1 1 1 1 1 2,1EL 332 -.132 &otal 32,013 12,0E3 ,H,E2E 3E,2E2 3,2LH 33,3H0 2,1EL 31,2E2 -41./3Current E,,EH1 12,0E3 ,2,202 2L,0E3 10,2L, 1 1 1H,2L1 422.143 4-.,4.-/4- - +estate* 8on-current 1 1 1 1 1 1 2,1EL 332 -.132 &otal E,,EH1 12,0E3 ,2,202 2L,0E3 10,2L, 1 2,1EL 12,310 420.5/6
6a7 6b7
!ubsidy resulting from 'ecree L,2E,M13, as described below. It refers to sundry receivables
'ue to the unfavorable hydroenergetic conditions since the end of 2012, including low reservoir levels at the hydroelectric plants, thermal power dispatch was at its maximum. &iven the concessionaires5 exposure to the spot mar*et, resulting from the allocation of power and capacity physical guarantee ?uotas, together with the termination of the 3th and Lth new energy auction contracts, due to the revo*ing of plant authori%ation by "neel, distributors5 energy costs increased substantially at the turn of the year. "s a result of this scenario, and the fact that the distribution concessionaires had no control over these costs, the federal government issued 'ecree L,2E,M13, which determined the transfer of funds from the energy development account 6<'#7 to partially offset the period impact on the distributors The funds covered by <'# transfers totaled 0GH01,0,H by 'ecember 31st, 2013, of whichA
0GE2L,3E2 refers to 6i7 !ystem !ervice <harges 6#!!7 6dispatch out of the order of priority for energy security7 in the amount of 0G1LH,0ELD 6ii7 +ydrological 0is* 6#nergy 0eallocation 9echanism 690#7 of the ?uotas7 in the amount of 0G1,2,1L3D and 6iii7 #xposure to the 'ifference !ettlement (rice 6(.'7 limited to the amount not covered by the allocation of ?uotas, in the amount of 0G130,E22. "ccording to <(< 0L B &overnment &rants and "ssistance, this amount was recogni%ed to offset incurred costs, recorded in =<'# !ubsidy> in other receivables, under current assets, with a corresponding entry to #lectricity purchased for resale in the income statement. @f this amount, 0GEL0,333 was already offset with the settlement in <<## up to 'ecember 31st, 2013, remaining 0G2L,302 to be offset. 0G303,E13 refers to <'# transfer relating to energy purchase costs up to "ugust 2013, defined in the 2013 tariff review process, which will be transferred in 8ovember 2013. "ccording to <(< 0L B &overnment &rants and "ssistance, this amount was recogni%ed to offset costs incurred, recorded in <'# &rants, in other accounts receivable, under current assets, with a corresponding entry to #lectricity purchased for resale in the income statement. The full amount was received on 'ecember 2th, 2013.
75
@n 'ecember 31st, 2013, the <ompany recorded a provision of 0G3,3L1 corresponding to <'# funds to offset the discounts applied in the tariffs charged from some consumer segments.
11) I8T#!T9#8T!
Parent Compan# 4-.,4.-/4, 9easured by the e?uity methodA .ight !#!" .ight #nergia 0enova #nergia !." 6b7 &uanhPes #nergia !." 6a76b7 .ight #sco #$. #nergia .ight<om .ight !oluNOes .ightger Itaocara #nergia 6a7 "xxiom "ma%Snia #nergia 6a7 #1(ower
6a7
Consoli*ate* 4-.,4.-/4, 4-.,4.-/4+estate*
4-.,4.-/4-
2,E33,E33 L0L,233 1 1 10E,332 1 13,233 2,E2L E1,L12 23,2E, H,20L 103,3H0 1 ,.661./62,03E 1 -./,6 ,.660./12
2,1HH,H1, ,LH,H12 1 1 10H,20E 1 2,01L 2,0E2 E1,202 2E,,3L ,,130 32,,L3 132 ,./-3.064 2,022 1 -./0,./,4./,,
1 1 3L3,223 H3,L33 1 E03 1 1 E1,L12 1 H,20L 103,3H0 1 2-/.,06 2,03E 12,LL, -4.3/0 26-.-/,
1 1 3H1,3H3 33,EL3 1 L12 1 1 E1,202 1 ,,130 32,,L3 132 5,5.,63 2,022 12,210 --.//551.,5/
S:)&O&AL &oodwill from future profitability @ther permanent investments S:)&O&AL &O&AL I8EES&ME8&S
6a7
6b7
<ompanies at pre1operational stage 0efers to investments calculated based on the ad4usted e?uity for purposes of e?uity in the earnings 6losses7 of subsidiaries
76
Information on subsidiaries 6consolidated7 and 4ointly1controlled entities 6e?uity income and proportional balances7 is as followsA
Parent Compan# Sharehol*ersJ eGuit# $i9i*en*s an* interest on eGuit# recei9a%le 4-.,4.-/4, 4-.,4.-/4$i9i*en*s an* interest on eGuit# recei9e* 4-.,4.-/4, 4-.,4.-/4Income>loss@ for the #ear
Su%si*iaries an* <ointl#-owne* su%si*iaries - Interest
4-.,4.-/4,
4-.,4.-/4-
-/4,
-/4-
.ight !#!" .ight #nergia .ight #sco .ight<om .ight !oluNOes .ightger Itaocara #nergia "xxiom "ma%Snia #nergia #1(ower
100.0) 100.0) 100.0) 100.0) 100.0) ,1.0) 100.0) ,1.0) 2,.,) 20.0)
2,E33,E33 L0L,233 10E,332 13,233 2,E2L E1,L12 23,2E, H,20L 103,3H0 1 ,.661./6-
2,1HH,H1, ,LH,H12 10H,20E 2,01L 2,0E2 E1,202 2E,,3L ,,130 32,,L3 132 ,./-3.064
1 63E,3,27 6207 61,03,7 61E27 1 1 623E7 1 1 >,2.45,@
612,HLL7 6,,02H7 62L27 6337 62L07 1 1 1 1 1 >40.-4/@
62E3,L2E7 6EE,0327 612,L3,7 63127 62L07 61,,HE7 1 61E37 1 1 >,/0.361@
62H2,E237 621L,22L7 62,1027 61,3H07 1 1 1 1 1 1 >5/,.0/-@
3H3,321 122,1H, 1L,L23 ,,EE0 ,23 2,3 63217 2HL 61,1227 1 2/0.62-
2HH,22, 133,L03 13,L1, 3,3L1 20E 1,231 1,H12 HL2 61,2HH7 6E2E7 66,.4,4
Consoli*ate* Sharehol*ersJ eGuit# Iointl#-owne* su%si*iaries Interest 4-.,4.-/4, .ight #nergia 0enova #nergia &uanhPes #nergia .ight #sco #$. #nergia .ightger "xxiom "ma%Snia #nergia #1(ower 33.0) ,1.0) ,1.0) 2,.,) 20.0) E03 E1,L12 H,20L 103,3H0 1 65/.534 L12 E1,202 ,,130 32,,L3 132 ,2/.2/, 1 1 623E7 1 1 >-,6@ 1 1 1 1 1 >42.42,@ 1 1 1 1 1 61.-,, 1 1 1 1 1 46.,522 2,3 2HL 61,1227 1 -.4,21L 1,231 HL2 61,2HH7 6E2E7 -4.556 21.2) ,1.0) 220,123 L3,L,3 21H,E0, 2E,L02 1 1 1 613,1337 1 EL,233 1 1E,3,2 1,332 1 21,002 1 4-.,4.-/4+estate* Capital stoc' to pa#-up 4-.,4.-/4+estate* ;un*s allocate* to capital increase 4-.,4.-/4, 4-.,4.-/4+estate* Income>loss@ for the #ear -/4+estate*
4-.,4.-/4,
-/4,
77
@ther informationA
Parent Compan# Pai*-up capital Su%si*iaries an* <ointl#owne* su%si*iaries .ight !#!" .ight #nergia .ight #sco .ight<om .ight !oluNOes .ightger Itaocara #nergia "xxiom "ma%Snia #nergia #1(ower 4-.,4.-/4, 2,0H2,33, LL,E22 L2,,HE E,,00 1,3,0 E0,E0H 22,,32 3,2HL 102,0,, LLL 4-.,4.-/42,0H2,33, LL,E22 L2,,HE E,,00 1,3,0 E0,E0H 22,,32 E,322 L1,0,2 LLL &otal Assets 4-.,4.-/4, 10,,23,2E3 2,102,10, 310,333 H0,,22 3,322 103,,E3 2L,13L 21,2L3 103,3L2 E,2 4-.,4.-/4H,23H,3,, 2,322,,32 1,,,LH2 31,E00 2,E23 112,H13 31,3EE H,3H2 32,3,2 E,2
Consoli*ate* Pai*-up capital Iointl#-owne* su%si*iareis 4-.,4.-/4, 4-.,4.-/4+estate* &otal Ati9o 4-.,4.-/4, 4-.,4.-/4+estate*
.ight #nergia 0enova #nergia &uanhPes #nergia .ight #sco #$. #nergia .ightger "xxiom "ma%Snia #nergia #1(ower 33L E0,E0H 3,2HL 102,0,, LLL 33L E0,E0H E,322 L1,0,2 LLL E20 103,,E3 21,2L3 103,3L2 E,2 LE2 112,H13 H,3H2 32,3,2 E,2 21E,,LE 23,,20 22E,13H 23,,20 H10,223 1E2,2E2 ,H2,2L2 33,233
78
<hanges in subsidiaries 6consolidated7 and 4ointly1controlled entities 6e?uity income7 in the years ended 'ecember 31stA
Parent Compan# Capital increase $i9i*en*s L interest on eGuit# 6230,HEL7 6L3,3237 61H,H,37 61,2217 61E27 61,1HH7 1 623E7 1 1 >,-2.-63@ 1 1 1 1 1 1 05.-64 Parent Compan# Capital increase 1 1 E2,000 1 1 1 1 1 33,31H EH3 15.3/6 $i9i*en*s L interest on eGuit# 623H,22E7 6212,10E7 61,1EE7 6LE7 62207 1 1 61E37 1 1 >650.23-@ Consoli*ate* 4-.,4.-/4+estate* Capital increase $i9i*en*s L interest on eGuit# EGuit# in the earnings >losses@ of su%si*iaries Comprehensi9e result 6123,22L7 6,,33,7 62017 6117 1 1 1 1 1 1 >4,4.316@ 1 >4.3/2@ EGuit# in the earnings >losses@ of su%si*iaries 1 1 6,3H7 63207 61327 1 6L1L7 1 1 2HH,22, 133,L03 13,L1, 3,3L1 20E 1,231 1,H12 HL2 61,2HH7 6E2E7 66,.4,4 1 61327 >265@ Comprehensi9e result EGuit# in the earnings >losses@ of su%si*iaries 1 1 63,3337 3,0H3 1 3H 617 617 3H3,321 122,1H, 1L,L23 ,,EE0 ,23 2,3 63217 2HL 61,1227 1 2/0.62-
4-.,4.-/4-
Other
4-.,4.-/4,
.ight !#!" .ight #nergia .ight #sco .ight<om .ight !oluNOes .ightger Itaocara #nergia "xxiom "ma%Snia #nergia #1(ower &O&AL
2,1HH,H1, ,LH,H12 10H,20E 2,01L 2,0E2 E1,202 2E,,3L ,,130 32,,L3 132 ,./-3.064
1 1 1 1 1 1 1 2,22, 3L,223 1 6/.-04
22,10E 2,22, 201 11
2,E33,E33 L0L,233 10E,332 13,233 2,E2L E1,L12 23,2E, H,20L 103,3H0 1 ,.661./6-
/4./4.-/4-
Other
4-.,4.-/4-
.ight !#!" .ight #nergia .ight #sco .ight<om .ight !oluNOes .ightger Itaocara #nergia "xxiom "ma%Snia #nergia #1(ower &O&AL
2,23,,111 332,,H2 ,,,0L2 ,,H21 1,,20 E0,3LH 23,EL2 E,E2L 3L,,E, 1E0 ,.4/,.,23
2,1HH,H1, ,LH,H12 10H,20E 2,01L 2,0E2 E1,202 2E,,3L ,,130 32,,L3 132 ,./-3.064
Other
4-.,4.-/4,
.ight #nergia 0enova #nergia &uanhPes #nergia .ight #sco #$. #nergia .ightger "xxiom "ma%Snia #nergia #1(ower &O&AL L12 E1,202 ,,130 32,,L3 132 5,5.,63 1 1 2,22, 3L,223 1 0/.534 62017 61,1HH7 623E7 1 1 >4.2-,@ Consoli*ate* /4./4.-/4+estate* .ight #nergia 0enova #nergia &uanhPes #nergia .ight #sco #$. #nergia .ightger "xxiom "ma%Snia #nergia #1(ower &O&AL ,,1 E0,3LH E,E2L 3L,,E, 1E0 66,.141 1 1 33,31H EH3 6,.206 1 1 1 1 1 -2.532 1 >403@ 6,37 1 61E37 1 21L 1,231 HL2 61,2HH7 6E2E7 -4.556 L12 E1,202 ,,130 32,,L3 132 5,5.,63 330,3L1 1 1 2,H20 1 23,,H3 1 3 21,002 1 3H1,3H3 33,EL3 Capital increase AcGuisition of interest EGuit# in the earnings >losses@ of su%si*iaries 4-.,4.-/4+estate* 1 61327 >2./66@ 3H1,3H3 33,EL3 1 ,0,220 1 1 6,,H227 1 1 612L7 3H 617 1,332 1 1 22 2,3 2HL 61,1227 1 -.4,E03 E1,L12 H,20L 103,3H0 1 2-/.,06 3L3,223 H3,L33
Other
79
The full balances of the main 4ointly1controlled entities on 'ecember 31st, 2013 and 2012, which recorded under the e?uity method, are as followsA
-/4, ASSE&S <urrent <ash and cash e?uivalents @ther 8on1current &O&AL ASSE&S LIA)ILI&IES <urrent .oans, financing and debentures @ther 8on1current .oans, financing and debentures @ther !hareholdersQ e?uity &O&AL LIA)ILI&IES I8COME S&A&EME8& 8et revenue from sales <ost of sales &ross profit &eneral and administrative expenses #?uity in the earnings of subsidiaries 8et financial result #arnings before income tax and social contribution Income tax and social contribution 8E& I8COME ;O+ &=E DEA+ 3L,,20 62L,L,27 2,H3H 6L,1237 1 627 2,L13 6LLH7 4.0,5 1 1 1 633,7 6E,0LH7 3L 6E,3L37 1 >6.212@ 30,,22 61H,H107 11,L12 62,E3L7 1 63,3L17 2,20E 61,03,7 4.320 223,011 6101,2027 12E,H02 633,3E17 1 6L2,2317 13,200 62,2L07 2.-,/ 1 1 1 1 1 1 1 1,020 6H337 2,E 62027 1 ,2 111 6E,7 22 1,,0E0 3,0L0 H,2L0 10,,L2 10,012 ,3L 13,023 64.141 1 1 1 1 1 E1L,1LL 641.411 11,3,2 L,3,3 3,323 102,H23 102,H23 1 H1,LHL -/,./,1,E02,,33 1,102,113 300,E20 1,223,33H 1,2H1,1E0 1,,12H 1,000,,,2 ,.1/2.6,, 130,33H 122,,E0 L,H2H ,,310 1 ,,310 1EE,31E -3/.-01 1 1 1,231 4.-11 E1 E1 33,,33 10,0E, 23,,1H H,1E2 64.142HL 2L, 12 E13,H20 641.411 21,3H1 1L,L03 3,3LH 1H1,3,1 -/,./,EL,,210 3LE,0EL 101,H33 3,230,,23 ,.1/2.6,, E0,21H 32,2H3 1,33, 232,3LE -3/.-01,23H 21H 320 3E 4.-1AKKIOM AMAPQ8IA LI(=&(E+ +E8OEA (:A8=RES E)L
80
-/4ASSE&S <urrent <ash and cash e?uivalents @ther 8on1current &O&AL ASSE&S LIA)ILI&IES <urrent .oans, financing and debentures @ther 8on1current .oans, financing and debentures @ther !hareholdersQ e?uity &O&AL LIA)ILI&IES I8COME S&A&EME8& 8et revenue from sales <ost of sales &ross profit &eneral and administrative expenses #?uity in the earnings of subsidiaries 8et financial result #arnings before income tax and social contribution Income tax and social contribution 8E& I8COME ;O+ &=E DEA+
AKKIOM
AMAPQ8IA
LI(=&(E+
E-PO?E+
+E8OEA
(:A8=RES
E)L
10,H30 2,0,3 H,LLE ,,30E 42.6,6
L22 L1L , 2L2,E,E -1,.412
32,202 1H,20E 1E,L0, 1HH,300 --4.-/0
1E, 31 11E 21E2 -.-06
332,22H 30H,122 31,1L3 2,00H,LE1 -.213./,0
E,HE3 E,HE3 1 123,E30 4,4.,/2
1,HHE HLE 1,010 3H, -.-20
3,313 EE0 ,,HL3 1 1 1 10,11H 42.6,6
32H 1 32H 1 1 1 2L2,HEH -1,.412
21,,33 H,1H3 13,3H0 11L,EL2 11L,EL2 1 H2,1LE --4.-/0
HLL 1 HLL 1 1 1 1,E1L -.-06
3L0,222 12H,201 1L2,02H 1,313,3E3 1,30,,321 11,022 221,32L -.213./,0
H1,03E 3E,LH2 13,2,2 1,H23 1 1,H23 EH,EE2 4,4.,/2
221 1 221 1 1 1 2,0EH -.-20
23,33, 61L,E117 ,,2,E 6E,E007 1 HE 1,33H H3 4.1-6
1 1 1 61,30,7 63,LE,7 1 6,,0,07 1 >5./5/@
21,23L 61E,L217 3,EE3 62,E1H7 1 2,23L 3,22, 6E,,H17 -.646
1 1 1 62,E,,7 61,7 1 62,EL07 1 >-.61/@
11,,332 6EH,H1H7 33,H21 6EE,0H27 1 622,,L17 131 63,1227 >5.023@
1 1 1 1 1 1 1 1 -
2,232 61,3LE7 H2, 61237 1 22 L21 6317 22/
@n 'ecember 31st, 2013, the current liabilities of the indirect 4ointly1controlled entity 0enova #nergia exceeded its current assets, mainly due to two loans for the construction of the wind farms, maturing on 9ay Eth, 201E and /une 1,th, 201E. 0enova #nergia5s 9anagement has been implementing initiatives to improve its wor*ing capital and financial structure that comprise primarily the inclusion of <#9I& &T in the controlling bloc* of 0enova #nergia by means of a capital transfer and the eligibility with the $8'#! to extend its debt by contracting long1term financing. a7 <onsortia
Itaocara +ydroelectric (owerplant <onsortium
The <ompany, through the subsidiary Itaocara #nergia, holds a ,1) interest in the +# Itaocara consortium, while <emig &eraNPo e TransmissPo !.". B <emig &T holds the other E2.0). The consortium aims to explore the Itaocara hydroelectric powerplant. "ssets and liabilities balances referring to the participation in the <onsortium are incorporated into the subsidiary5s balances. @n 'ecember 2Hth, 2011, I$"9" granted the prior license and on /uly 22, 2013, Itaocara +ydroelectric (ower (lant obtained the installation license allowing the beginning of wor*s. @n "ugust 2, 2013, the subsidiary Itaocara #nergia re?uested the termination of the <oncession "greement 12M2001 to "8##., as per "rticle E 1 " of .aw 20LEM200,, introduced by .aw 12H32M2013. The decision is based on the fact that the necessary time of revenue to obtain return on investment was 4eopardi%ed after 12 years of the concession term have elapsed before the release of the Installation #nvironmental .icense.
81
$ased on said "rticle, the <ompany understands that there will be no significant loss in the investments made in the pro4ect so far because it is entitled to the following rightsA 6i7 the release of guarantees of compliance with obligations concerning the <oncession "greementD 6ii7 the non1payment for the se of (ublic "ssetD and 6iii7 the reimbursement for costs incurred in the preparation of studies or plans. The investments recorded as asset in Itaocara #nergia are basically costs necessary to obtain the (revious #nvironmental .icense, the Installment #nvironmental .icense and the pro4ect5s feasibility. @n 8ovember 23th, 2013, the 9inistry of 9ines and #nergy 699#7 and the Itaocara #nergia subsidiary entered into an instrument of termination for the <oncession "greement 12M20011"8##., which governs the implementation and exploration of the Itaocara +ydroelectric (owerplant. <onsidering the above1mentioned return, the consortium reversed the obligation for the se of (ublic "sset against intangible assets. The auction of the Itaocara I +ydroelectric (owerplant was scheduled for 'ecember 13th, 2013, pursuant to "uction 8otice 10M2013, but "8##., on a note disclosed on 'ecember Eth, 2013, removed the Itaocara I +ydroelectric (owerplant from the auction due to a reappraisal of the :ater "vailability 0eserve "mount. 9anagement believes that the Itaocara I +ydroelectric (owerplant will be auctioned in 201E, and the <ompany is assessing the possibility of ta*ing part in this process.
9aracanP !olar <onsortium
The <ompany, through subsidiary .ight #sco !."., holds a ,1.0) interest in the 9aracanP !olar consortium, whereas #'- <onsultoria em (ro4etos de &eraNPo de #nergia #lItrica .tda. B #'<onsultoria holds E2.0) interest. The consortium aims at the development, construction and operation of a photovoltaic plant with capacity of 321 *:p, installed on the top of the 9aracanP stadium. The construction has been concluded in the second ?uarter of 2013. The original contract entered into with the !tate of 0io de /aneiro established the recovery of the invested amount through the sale of energy. In "ugust 2013, the <ompany signed an amendment with the state of 0io de /aneiro, changing the way the investment is to be recovered to the sale of ?uotas of the photovoltaic plant, through the 9aracanP !olar seal. +owever, as the negotiations of these ?uotas are at an early stage, 9anagement has decided to record a provision for loss on property, plant and e?uipment, corresponding to the investments made by the <onsortium in the amount of 0GE,23H given that it did not have sufficient evidence on the recoverability of these assets on 'ecember 31st, 2013.
agua .impa +ydroelectric (owerplant <onsortium
The <ompany, through its subsidiary .ight #nergia !."., is a party to the agua .impa +ydroelectric (owerplant <onsortium, in the state of 9ato &rosso, with a ,1.0) interest, and the other party is <emig &eraNPo e TransmissPo !." B <#9I& &T, with a E2.0) interest. The consortium5s purpose is to implement, operate, maintain and commercially explore the pro4ect. There were no relevant expenses incurred until 'ecember 31st, 2013.
82
12) (0@(#0TF, (."8T "8' #C I(9#8T

Consoli*ate* 4-.,4.-/4, A9erage annual rate &eneration Transmission 'istribution "dministration !ales I8 SE+EICE &eneration "dministration I8 P+O(+ESS &O&AL P+OPE+&D. PLA8& A8$ E7:IPME8& 3.32 3.21 10.2L L.23 L.23 =istorical cost 2,32H,H2H ,L,2HE 31,,H1 313,3,2 1E,L3E ,.442.542 231,,1L 1EH,13H 6/0.255 ,.5-2.414 Accumulate* *epreciation 61,,21,1HL7 6E3,3237 62L,H0H7 61L3,1L27 6H,HL27 >4.361.660@ 1 1 >4.361.660@ 8et 9alue 1,10L,3E1 1E,,HH 3,LL3 13L,1H0 ,,HH, 4.-20./21 231,,1L 1EH,13H 6/0.255 4.213.1-4-.,4.-/4+estate* 8et 9alue 1,13L,233 1E,L23 E,20H 121,0,2 3,2H1 4.-35.//6 23H,0LH 112,1L3 ,5/.-54 4.2,5.-55
The statement below summari%es the changes in property, plant and e?uipmentA
Consoli*ate* )alance on 4-.,4.-/4+estate* P+OPE+&D. PLA8& A8$ E7:IPME8& I8 SE+EICE <ost .and 0eservoir, dams and water mains $uildings, wor*s and improvements 9achinery and e?uipment Tehicles -urniture and fixtures &O&AL P+OPE+&. PLA8& A8$ E7:IPME8& I8 SE+EICE - COS& 617 'epreciation 0eservoir, dams and water mains $uildings, wor*s and improvements 9achinery and e?uipment Tehicles -urniture and fixtures &O&AL P+OPE+&D. PLA8& A8$ E7:IPME8& I8 SE+EICE COS&L$EP+ECIA&IO8 P+OPE+&D. PLA8& A8$ E7:IPME8& I8 P+O(+ESS .and 0eservoir, dams and water mains $uildings, wor*s and improvements 9achinery and e?uipment Tehicles -urniture and fixtures !tudies and pro4ects &O&AL P+OPE+&D. PLA8& A8$ E7:IPME8& I8 P+O(+ESS &O&AL P+OPE+&D. PLA8& A8$ E7:IPME8& 2H H,,330 L1,131 1,3,0H0 LLL 3L,LHL 2,01H ,5/.-54 4.2,5.-55 3E 13,E01 10,02, 22,EH0 133 1,1L2 33E 4-6.162 5/.-6/ 1 1 1 6E,01H7 1 1 1 >6./43@ >2.11,@ 1 610,2207 612,,327 633,3E27 6L,L7 1 61,E337 >24.,-6@ 132 HH,,11 3H,3HL 212,200 1H3 3H,233 2E3 6/0.255 4.213.1-6L2H,,HH7 6131,HH37 6L22,0L,7 613,23,7 611E,3,H7 >4.341.320@ 621,0,27 6,,,E27 6E3,,137 6E127 63,2HE7 >16.5/2@ 1 3,E,H 3H,L01 2EL 2,,20 66.0-2 1 1 1 1 1 6H12,3E07 6133,23L7 6L33,H207 61E,1307 611,,H227 >4.361.660@ 10E,2L3 1,2,E,12E 231,0H, 1,330,,0H 1E,H21 13L,2H2 ,.4/-.31, 1 1 1 1 1 1 1 1 63,32L7 6E1,2HL7 62EL7 62,,207 >61.234@ 1 10,222 10,3L2 3H,E20 32, ,E, 24.,-6 10E,2L3 1,23,,1H3 23H,130 1,32L,L11 1,,122 13,,31E ,.442.542 )alance on 4-.,4.-/4,
A**itions
?rite offs >a@
&ransfer to Ser9ice
6a7
Includes provision for loss on property, plant and e?uipment, corresponding to the investments made by the 9aracanP <onsortium.
83
Consoli*ate* )alance on /4./4.-/4+estate* P+OPE+&D. PLA8& A8$ E7:IPME8& I8 SE+EICE <ost .and 0eservoir, dams and water mains $uildings, wor*s and improvements 9achinery and e?uipment Tehicles -urniture and fixtures &O&AL P+OPE+&. PLA8& A8$ E7:IPME8& I8 SE+EICE - COS& 617 'epreciation 0eservoir, dams and water mains $uildings, wor*s and improvements 9achinery and e?uipment Tehicles -urniture and fixtures &O&AL P+OPE+&D. PLA8& A8$ E7:IPME8& I8 SE+EICE COS&L$EP+ECIA&IO8 P+OPE+&D. PLA8& A8$ E7:IPME8& I8 P+O(+ESS .and 0eservoir, dams and water mains $uildings, wor*s and improvements 9achinery and e?uipment Tehicles -urniture and fixtures !tudies and pro4ects &O&AL P+OPE+&D. PLA8& A8$ E7:IPME8& I8 P+O(+ESS &O&AL P+OPE+&D. PLA8& A8$ E7:IPME8& 32 L3,LH2 32,103 H2,2E, H2H 2H,L23 3,H,1 -53.261 4.2/4./16 ,2 11,,EH 11,02E H1,2HE 1 2,031 222 44,.0/5 64.324 1 1 1 1 1 1 1 >1.23/@ 62,0327 >--.,/4@ 1 1 6H,2327 611,1E27 61217 2H H,,330 L1,131 1,3,0H0 LLL 3L,LHL 2,01H ,5/.-54 4.2,5.-55 6LLL,,1L7 61,,,H227 63HH,3LH7 623,,EL7 6110,0207 >4.155.-36@ 621,0L17 63,0317 6E0,H007 6,3,7 6E,33H7 >1-.3,5@ 1 1 103 10,1EL 1 4/.-5/ 1 1 1 1 1 6L2H,,HH7 6131,HH37 6L22,0L,7 613,23,7 611E,3,H7 >4.341.320@ 10E,2L3 1,2,E,12E 2,L,E33 1,31L,0,2 22,HEL 13E,132 ,./01.144 1 1 104 1 1 E LHL 1 1 1 62,LH17 61,,1E27 1 >41.0,/@ 1 1 3,31, 1,,EE3 123 3,120 --.,/4 10E,2L3 1,2,E,12E 231,0H, 1,330,,0H 1E,H21 13L,2H2 ,.4/-.31, A**itions ?rite offs &ransfer to Ser9ice )alance on 4-.,4.-/4+estate*
In 2013, 0G32L 60G1,32E in 20127 was carried over to property, plant and e?uipment as interest capitali%ation, with average capitali%ation rate of H ) p.a. 6i7 "nnual depreciation ratesA The table below summari%es significant depreciation rates, based on the assets5 estimated useful lives and in line with "8##. 0esolution 8o. ELE, of -ebruary Lth, 2012A
(E8E+A&IO8 'ams <ircuit brea*er $uildings :ater inta*e e?uipment :ater inta*e structure &enerator 0eservoirs, dams and water mains .ocal communication system +ydraulic turbine A 2.,0 3.03 3.33 3.L0 2.H3 3.33 2.00 3.3L 2.,0 $uildings &eneral e?uipment Tehicles SALES A 3.33 3.2, 1E.22 A$MI8IS&+A&IO8 $uildings &eneral e?uipment Tehicles A 3.33 3.2, 1E.22 &+A8SMISSIO8 !ystem conductor &eneral e?uipment !ystem structure 0ecloser A 2.L0 3.2, 2.L0 E.00
The <ompany did not identify indicators of impairment of its fixed assets, except for the assets of the photovoltaic plant of the 9aracanP !olar <onsortium, fully recogni%ed as a provision in 2013. The concession agreements of the hydroelectric powerplants of subsidiary .ight #nergia establish that at the end of each concession5s term the granting authority will determine the amount to be indemnified to the subsidiaries and 4ointly1controlled entities, so that 9anagement understands that the value of fixed assets not depreciated at the end of concession will be reimbursed by the granting authority.
84
-or property, plant and e?uipment items without indemnity guarantee, the items are depreciated under the straight1line method up to the authori%ation or concession limit.
1.) I8T"8&I$.# "!!#T!

4-.,4.-/4, Accumulate* amorti ation 63,E20,12,7 6EE2,3317 >,.0,-.652@ 1 1 >,.0,-.652@ 4-.,4.-/4+estate* 8et 9alue 3,021,H32 102,L31 ,.4,4.50, 333,323 13L,122 3,/.545 ,.02-.4/3 8et 9alue 2,2HE,LH2 2,,,E2 ,./3/.,,4 E3,,221 202,313 223.,/1 ,.163.2,3
=istorical cost <oncession right of use @ther 6a7 I8 SE+EICE <oncession right of use @ther 6a7 I8 P+O(+ESS &O&AL I8&A8(I)LE ASSE&S
6a7
3,,11,2HL ,,2,032 1./26./60 333,323 13L,122 3,/.545 1.306.526
Includes basically software and right1of1way.
Intangible assets are net of special obligations, representing contributions made by the federal government, states, municipalities and consumers, as well as any un?ualified donations 6i.e. not sub4ect to any consideration to the benefit of donor7, and subsidy intended as investments to be made toward concession of the electric power distribution utility. The balance of special obligations on 'ecember 31st, 2013 totaled 0G223,3,3 60G1,3,2HH on 'ecember 31st, 20127. Investments in the distribution networ* are initially recorded in intangible assets under development, during the construction period. :hen they are finali%ed and in compliance with I<(< 01, the investments are divided into two parts 6bifurcated7, the first of which is recorded in intangible assets in service, related to the amount that will be amorti%ed during the concession term, and the other is transferred to the concession5s financial assets and will be received as indemnification at the end of the concession. Intangible in progress includes inventories of pro4ect materials in the amount of 0G12H,1,L as of 'ecember 31st, 2013 60G22,HE3 as of 'ecember 31st, 20127, as well as a provision for inventory devaluation in the amount of 0G3,2E2 60G2,10E as of 'ecember 31st, 20127. The <ompany has not identified signs of impairment of its other intangible assets. " total amount of 0G23,3E1 60G33,,,2 as at 'ecember 31st, 20127 was carried over to intangible assets in 2013 as interest capitali%ation, with an average capitali%ation rate of H) p.a. The infrastructure used by subsidiary .ight !#!" is associated with the distribution service, and therefore cannot be removed, disposed of, assigned, conveyed, or encumbered as mortgage collateral without the prior written authori%ation of the granting authority, which authori%ation, if given, is regulated by 0esolution "8##. 8o. 20M22.
85
$elow is a summary of changes in the intangible assetsA

Consoli*ate* )alance on 4-.,4.-/4+estate* I8 SE+EICE <oncession right of use @ther &O&AL I8&A8(I)LE ASSE&S I8 SE+EICE 617 "morti%ation <oncession right of use @ther &O&AL I8&A8(I)LE ASSE& I8 SE+EICELAMO+&IPA&IO8 I8 P+O(+ESS <oncession right of use @ther &O&AL I8&A8(I)LE ASSE& I8 P+O(+ESS &O&AL E3,,221 202,313 223.,/1 ,.163.2,3 L33,L0, H,2E0 164.065 6-5.022 1 1 >42.5/3@ 6,33,3037 6E3,E3E7 >510.1,1@ >405.033@ 333,323 13L,122 3,/.545 ,.02-.4/3 63,322,2,E7 6E2H,1327 >6.4-3.442@ 62H1,3LE7 63E,30,7 >,45.010@ E21,203 20,E33 544.2,0 1 1 63,E20,12,7 6EE2,3317 >,.0,-.652@ 3,3HE,L33 ,23,L11 1.-/3.661 1 1 6,0L,,1H7 620,3227 >5-3.461@ 33E,L32 EH,2H0 ,3,.160 3,,11,2HL ,,2,032 1./26./60 Inter-account transfers >a@ )alance on 4-.,4.-/4,
A**itions
?rite offs
6a7
Includes transfer of 0G12,,2HH to <oncession -inancial "sset, as a result of the split of assets upon startup, pursuant to I-0I< 12MI<(< 01.
Consoli*ate* )alance on /4./4.-/4+estate* Inter-account transfers >a@ )alance on 4-.,4.-/4+estate*
A**itions
?rite offs
I8 SE+EICE <oncession right of use @ther &O&AL I8&A8(I)LE ASSE&S I8 SE+EICE 617 'epreciation <oncession right of use @ther &O&AL I8&A8(I)LE ASSE& I8 SE+EICELAMO+&IPA&IO8 I8 P+O(+ESS <oncession right of use @ther &O&AL I8&A8(I)LE ASSE& I8 P+O(+ESS &O&AL L22,33E 223,LE2 4./-2.44, ,.313.-22 3,3,LL3 E,331 253.6/1 ,0-.-04 1 1 >4,.-/4@ 62HL,1E27 622,03E7 >4./42.-4,@ >5/3.143@ E3,,221 202,313 223.,/1 ,.163.2,3 63,E,H,3227 6E00,3EL7 >,.350.-20@ 62E1,3327 62L,,1,7 >-23.361@ 1 1 1 1 63,322,2,E7 6E2H,1327 >6.4-3.442@ 3,213,120 E2,,302 2.144.6--.1,4 2,L31 613,2017 1 >4,.-/4@ EL2,0H3 2H,E02 5/1.605 3,3HE,L33 ,23,L11 1.-/3.661
6a7
Includes reclassification of 0G11H,2HH referring to "8##. 8ormative 0esolution ELEM12 6see 8ote 27 and transfer of 0G320,E30 to <oncession -inancial "sset, as a result of the split of assets upon startup, pursuant to I-0I< 12MI<(< 01.
It is the responsibility of "8##. to determine the estimated economic useful lives of each piece of distribution infrastructure assets for pricing purposes, as well as for the purpose of calculating the amount of the relevant compensation payable upon expiration of the concession term. This estimate is revised from time to time, represents the best estimate concerning the assetsQ useful lives, and is accepted in the mar*et as appropriate for accounting and regulatory purposes. 9anagement understands that amorti%ation of the concessionQs right of use must be consistent with the return expected on each infrastructure asset, via the applicable rates. Thus, intangible assets are amorti%ed over the expected length of such return, limited to the term of the concession.
86
The main amorti%ation rates, based on the assets5 estimated useful lives, were changed by "8##. 0esolution no. ELEM12. In the first ?uarter of 2012, this change resulted in the reclassification of 0G11H,2HH from intangible assets to financial assets, without changing the other accounting procedures arising from the adoption of I-0I< 12M@<(< , B <oncession "greements. $elow, the main amorti%ation rates, in accordance with "8##. 0esolution 8o. ELE, of -ebruary Lth, 2012, are as followsA
$IS&+I):&IO8 <apacitor ban* !witchboard !ystem conductor <ircuit brea*er $uildings !ystem structure 9eter Toltage regulator 0ecloser Transformer A 3.3L 3.3L 3.,L 3.03 3.33 3.,L 3.LL E.3, E.00 E.00
14) ! ((.I#0!
Consoli*ate* C:++E8& !ales within the scope of <<## #lectric networ* usage charges !ystem service charges -ree energy B refund to generation companies 6a7 #lectric power auctions Itaipu binational T# 8orte -luminense !upplies and services &O&AL
6a7
4-.,4.-/4, 221,3HH 2E,H,L 2,21, 32,,E1 1E3,313 11E,H3L 2,,EL3 232,33H 0/1.-2-
4-.,4.-/4+estate* H2,30L ,2,,20 2,213 ,L,L20 22L,233 11H,L0L 21,2LH 1L3,L1, 346.620
-ree #nergy B 0eimbursement to (ower &eneration <ompanies
"8##. 0esolution 8o. 3HL as of 'ecember 1,th, 2002, published /anuary 12th, 2010, concluded the process of calculating the 0evenue .oss and -ree #nergy closing balances after the conclusion of the #xtraordinary Tariff 0eview 1 0T#, and also determined the amounts of any reimbursement operators should pay each other, as applicable, and payments shall be made on "pril 2, 2011. +owever, said reimbursements are suspended according to in4unction filed by the $ra%ilian "ssociation of #lectricity 'istribution @perators 6"$0"'##7 on "pril Lth, 2011. The balance was ratified at 0GEH,2H, and the variation, since ratification, resulting from ad4ustment by !#.I< 6overnight lending rate7.
87
The <ompany5s exposure to credit ris*s related to suppliers is reported in 8ote 3E.
1/) T"V#! ("F"$.#
Parent Compan# 4-.,4.-/4, Current &AKES A8$ CO8&+I):&IO8S (I! and <@-I8! payable I<9! payable @ther I8COME &AK A8$ SOCIAL CO8&+I):&IO8 :ithheld income tax payable &O&AL 44./63 10,2L0 12 33 2 44./5/ 4-.,4.-/4Current 4.26/ 1,,33 12 3, 2 4.26-
Consoli*ate* 4-.,4.-/4, Current &AKES A8$ CO8&+I):&IO8S I<9! payable (ayment in installments 1 .aw 11,2E1M02 (I! and <@-I8! payable I8!! @ther I8COME &AK A8$ SOCIAL CO8&+I):&IO8 :ithheld income tax payable (rovision for income taxMsocial contribution &O&AL 445.4/23,231 22,L0H ,E,103 E,,33 L,E31 3,.542 ,E3 H2,2L3 403.243 8on-current 431.26/ 1 1HL,3E0 1 1 1 1 1 431.26/ &otal ,/-.1623,231 210,3EH ,E,103 E,,33 L,E31 1 3,.542 ,E3 H2,2L3 ,32.-53 Current 3-.,5, 13,002 1H,032 3,,3H3 3,E13 2,1L3 5/.,5, E,1 E2,202 4,-.1/2 4-.,4.-/4- - +estate* 8on-current 405.154 1 12,,L,1 1 1 1 1 1 405.154 &otal -13.4/6 13,002 213,H20 3,,3H3 3,E13 2,1L3 5/.,5, E,1 E2,202 ,-3.651
88
10) .@"8!, -I8"8<I8& "8' -I8"8<I". <+"0&#!

Consoli*ate* Current Principal T8 1 (ar $ond T8 1 !urety 1 (ar $ond T8 1 'iscount $ond T8 1 !urety 1 'iscount $ond T8 1 <. $ond T8 1 $ib 9erril .ynch $8( <itiban* $an* To*yo 1 9itsubishi &O&AL ;O+EI(8 C:++E8CD #letrobrYs <<$ $radesco :or*ing capital 1 !antander $anco do $rasil $8'#! 1 -I8#9 $8'#! 1 -I8#9 direto $8'#! 1 -I8#9 W 1 $8'#! 1 -I8#9 direto (!I $8'#! 1 <apex 11M12 !ubcred.1 $8'#! 1 <apex 11M12 !ubcred.2 $8'#! 1 <apex 11M12 !ubcred.3 $8'#! 1 <apex 11M12 !ubcred.E $8'#! 1 <apex 11M12 !ubcred.13 $8'#! 1 <apex 11M12 !ubcred.1E $8'#! 1 <apex 11M12 !ubcred.1L $8'#! 1 <apex 11M12 !ubcred.1H $8'#! 1 <apex 11M12 .ight #nergia $8'#! 1 (0@#!<@ 1st funding $8'#! 1 (0@#!<@ 2nd funding $8'#! 1 (0@#!<@ 3rd funding $8'#! 1 (0@#!<@ Eth funding $8'#! 1 (0@#!<@ ,th funding $8'#! 1 (0@#!<@ 3th funding $8'#! 1 (0@#!<@ Lth funding $8'#! 1 (0@#!<@ Hth funding $8'#! 1 (0@#!<@ 2th funding $8'#! 1 (0@#!<@ 10th funding $8'#! 1 (0@#!<@ 11th funding $8'#! 1 (0@#!<@ b !( 9ar*et 0&0 !undry ban* guarantees &O&AL LOCAL C:++E8CD &O&AL 1 1 1 1 3,HL, 1 22,H3H 113,L01 1 1 461.666 L1E L,,000 H0,000 1 31,23, 22,3,1 22,3,1 12,3H0 3E2 3E,2H2 E2,032 E2,032 1 1 E E 3,23, 230 22 102 E,L 1,0H3 103 L, L0L 2H LLE 122 1,33H 1 1 6-4.--3 523.211 1 1 1 1E 2E3 H12 43.26, --.103 1 1 3 L 1 1 1 33H H22 1,313 1,2 6.455 1 3,E23 2,LE2 ,,3EH 230 302 3E0 13E , ,0L 3,H L11 1 1 1 1 H1 1 Charges 1,1LH 1 203 1 33 &otal 1,1LH 1 203 1 3,2E1 1 30,203 11E,,23 1,313 1,2 454.500 L1E H1,E23 H2,LE2 ,,3EH 32,12, 22,2,3 22,221 12,H1E 3EL 3,,E23 E2,L2L E2,LH0 1 1 E E L,0E3 231 22 102 E30 1,020 10E L3 L0L 2H LLE 122 1,3,2 2E3 H12 6,0.314 504.61/ 1 E, ,33 1,23E 231 132 H,3,2 3E, E,H3L 1,EH2 3,L22 1 1 4.4,4.-00 4.3-,.601 8on-current Principal 21,1L3 63,,HHE7 33,31L 6E3,12E7 1 1 HL,232 1 E21,33H 1E0,,,3 20-.403 ,,22H 22,,000 1 1,0,000 1 32,1HL 32,1HL 30,230 1,23H 1EH,L02 1LH,L2, 1LH,222 1 1 1H 1H 22,33H LL 4-.,4.-/4, 22,3,1 63,,HHE7 33,H23 6E3,12E7 3,2E1 1 11L,E3H 11E,,23 E22,2HE 1E0,L1, 36,.101 3,3E2 303,E23 H2,LE2 1,,,3EH 32,12, 22,1E0 22,1LH L3,0EE 2,2H, 1HE,12H 221,,22 221,002 1 1 22 22 22,3HE 30H 22 1,E 223 2,3,E 33, 23H 2,333 3L3 ,,311 1,311 ,,1EE 2E3 H12 4.514.41/ -.646.021 &otal 4-.,4.-/4+estate* H0,,,2 632,E2E7 ,,,L0E 6E3,LE17 10,313 2,1 102,,0, 2,,L,2 332,0H3 1 2/3.//,,0L2 3H0,3L, H2,133 1 1E,,103 12H,HLH 12H,22, H,,L3H 1 20,,EHL 233,E1, 21H,232 1 1 2, 2, 23,332 ,32 212 23E 1,E,2 3,EE0 E3H 313 1 1 1 1 3,EH3 2E3 2H0 4.255.6-0 -.-2,.6,4
89
The statement below summari%es the contractual terms and conditions applicable to our loans and borrowings as of 'ecember 31st, 2013A
Principal amorti ation ;inancing Entit# T8 1 (ar $ond T8 1 !urety 1 (ar $ond T8 1 'iscount $ond T8 1 !urety1 'iscount $ond T8 1 <. $ond 9erril .ynch $8( <itiban* <itiban* 1 #nergia $an* To*yo 1 9itsubishi #letrobrYs <<$ $radesco :or*ing capital 1 !antander $anco do $rasil $8'#! 1 -I8#9 $8'#! 1 -I8#9 direto $8'#! 1 -I8#9 W1 $8'#! 1 -I8#9 direto (!I $8'#! 1 <apex 11M12 !ubcred.1 $8'#! 1 <apex 11M12 !ubcred.2 $8'#! 1 <apex 11M12 !ubcred.3 $8'#! 1 <apex 11M12 !ubcred.3 $8'#! 1 <apex 11M12 !ubcred.E $8'#! 1 <apex 11M12 !ubcred.E $8'#! 1 <apex 11M12 !ubcred.13 $8'#! 1 <apex 11M12 !ubcred.1E $8'#! 1 <apex 11M12 !ubcred.1L $8'#! 1 <apex 11M12 !ubcred.1H $8'#! 1 <apex 11M12 ..#nergia $8'#! 1 (0@#!<@ 1st funding $8'#! 1 (0@#!<@ 2nd funding $8'#! 1 (0@#!<@ 3rd funding $8'#! 1 (0@#!<@ 3rd funding $8'#! 1 (0@#!<@ Eth funding $8'#! 1 (0@#!<@ Eth funding $8'#! 1 (0@#!<@ ,th funding $8'#! 1 (0@#!<@ ,th funding $8'#! 1 (0@#!<@ 3th funding $8'#! 1 (0@#!<@ Lth funding $8'#! 1 (0@#!<@ Hth funding $8'#! 1 (0@#!<@ 2th funding $8'#! 1 (0@#!<@ 10th funding $8'#! 1 (0@#!<@ 11th funding $8'#! 1 (0@#!<@ !(b9ar*et $ate of signature EM22M1223 EM22M1223 EM22M1223 EM22M1223 EM22M1223 11MLM2011 10M1LM2011 HM23M2012 10M2M2012 3M11M2013 !undry 10M1HM200L 2M3M2010 2M2,M2013 11M,M200L 11M30M2002 11M30M2002 11M30M2002 12M3M2011 12M3M2011 12M3M2011 12M3M2011 12M3M2011 12M3M2011 12M3M2011 12M3M2011 12M3M2011 12M3M2011 EM10M2012 2M13M200H EM1LM2002 EM12M2010 EM12M2010 2M1,M2010 2M1,M2010 11M13M2010 11M13M2010 LM22M2011 2M2LM2011 3M23M2013 3M23M2013 3M23M2013 3M23M2013 1M12M2012 Currenc# 4 5 4 5 4 5 4 5 4 5 4 5 64!O 4 5 4 5 4 5 !5 !5 !5 !5 4!78LP 4!78LP 4!78LP !5 4!78LP 4!78LP 4!78LP 4!78LP 4!78LP 4!78LP 4!78LP 4!78LP 4!78LP 4!78LP 4!78LP 4!78LP 4!78LP !5 4!78LP 4!78LP !5 4!78LP !5 4!78LP 4!78LP 4!78LP 4+9*D6 4+9*D6 4+9*D6 4!78LP Interest rate p.a. 3.0 G Treasury .ibor39W0.HWTc G Treasury H.0 .ibor39W2.1, 3.2H .ibor39W1.33 .ibor39W1.,2 2.0E ,.00 <'I W 0.H, <'I W 1.E 102.3) of <'I T/.( W E.3 T/.( W 2.,H T/.( W 3.,H E.,0 T/.( T/.( W 1.H1 T/.( W 2.21 T/.( W 3.21 T/.( W 2.21 T/.( W 3.21 T/.( W 2.21 T/.( W 3.21 T/.( W 2.21 T/.( W 3.21 T/.( W 1.H1 T/.( W 2.,1 T/.( W 2., E.,0 T/.( W 2.1H T/.( W 2.0, ,.,0 T/.( W 2.0, ,.,0 T/.( W 1.H1 T/.( W 1.H1 T/.( W 2.1H T/.( W 2.1H T/.( W 2.1H T/.( W 3 T/.( W 1.H1 Effecti9e rate 3.00) 0.00) 1.2E) 0.00) H.00) 2.E1) 3.2H) 1.22) 1.H,) 2.0E) ,.00) H.2,) 2.,,) H.2E) 2.30) L.,H) H.,H) E.,0) ,.00) 3.H1) L.21) H.21) L.21) H.21) L.21) H.21) L.21) H.21) 3.H1) L.,1) L.,0) E.,0) L.1H) L.0,) ,.,0) L.0,) ,.,0) 3.H1) 3.H1) L.1H) L.1H) L.1H) H.00) 3.H1) )eginning 202E 202E 202E 202E 200E 201E 201E 201L 201L 2013 12HH 2012 201E 201L 2002 2011 2011 2011 201E 201E 2013 2013 2013 2013 2013 2013 2013 2013 2013 2002 2002 2010 2010 2011 2011 2011 2011 2012 2012 201E 201E 201E 201E 2012 Pa#ment .ump sum .ump sum .ump sum .ump sum +alf1yearly +alf1yearly .ump sum +alf1yearly +alf1yearly .ump sum 9onthly and Cuarterly "nnual .ump sum .ump sum 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly 9onthly En* 202E 202E 202E 202E 201E 2013 201E 201H 201H 2013 2012 201L 201E 201L 201E 201L 201L 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 201H 201, 201E 201, 201, 2013 2013 2013 2013 201L 201L 2023 2023 2012 2023 201L
@n -ebruary 2,th, 2013, the <ompany raised 0G1,0,000 through <ommercial <redit 8otes 6<<87 with $anco do $rasil for wor*ing capital purposes. @n 9arch 11st, 2013, the <ompany raised 0G113,HH0 with $an* To*yo19itsubishi for wor*ing capital purposes. @n 9ay 1,th, 2013, the subsidiary .ight !#!" conducted its 2nd issue of <ommercial (romissory 8otes totaling 0G,00,000. 'espite the 1H01day maturity of promissory 8otes, except for early maturity or total redemption as set forth in the agreement, they were paid on /une 2H, 2013, when 0G1,300,000 was raised from the 2th issue of debentures of subsidiary .ight !#!", as disclosed in 8ote 1L. @n 9ay 23rd, 2013, the total of 0G,3,E31 was received, referring to the 2011M2012 $8'#! borrowing agreement of the subsidiary .ight !#!".
90
In addition to the collaterals indicated above, loans are guaranteed by receivables in the approximate amount of 0G100,0L0 60G103,333 on 'ecember 31st, 20127. @n 'ecember 31st, 2013, .ight !.". has guarantees, sureties or corporate guarantees issued in favor of its subsidiaries, 4ointly1controlled entities or associated companies totaling 0G,,0,H,L23. @n 'ecember 31st, 2013, the <ompany has available credit facilities totaling 0G200,000. The principal of consolidated loans and financing, classified in non1current liabilities, matures as follows 6excluding financial charges7 on 'ecember 31st, 2013A
Consoli*ate* Local Currenc# 201, 2013 201L 201H 2012 after 2012 &O&AL 2H0,223 2L2,000 3HH,L13 13L,,H2 E1,322 E,032 4.4,4.-00 ;oreign Currenc# E,,02, 1H2,L23 2H1,112 1E0,,,3 1 E2,L12 20-.403 &otal 32,,321 E31,L23 332,H2H 2LH,1E, E1,322 E3,LH1 4.3-,.601
The percentage variation of the main foreign currencies and the percentages of the main economic ratios in the period, which are used to ad4ust loans, financing and debentures, were as follows in the yearsA
4-.,4.-/4, !' # 0 I&(19 <'I T/.( I(<" 1E.3) 12.L) ,.,) H.1) ,.0) ,.2) 4-.,4.-/4H.2) 10.L) L.H) H.E) ,.3) ,.H)
$elow, the consolidated loans and financing brea*down for the yearsA
91
Consoli*ate* Principal )ALA8CE O8 /4./4.-/4- - +estate* .oans and financing 9onetary and exchange variation -inancial charges accrued -inancial charges paid -inancing amorti%ation -unding cost amorti%ation -inancial charges capitali%ed to the principal <harges capitali%ed to intangible assetsMproperty, plant and e?uipment )ALA8CE O8 4-.,4.-/4- - +estate* .oans and financing 9onetary and exchange variation -inancial charges accrued -inancial charges paid -inancing amorti%ation -unding cost amorti%ation -inancial charges capitali%ed to the principal <harges capitali%ed to intangible assetsMproperty, plant and e?uipment )ALA8CE O8 4-.,4.-/4, 4.354.,1/ 31L,2,0 20,2H2 1 1 62E2,3337 2,, 12 1 -.-61.-,, H,2,,0H 12,,3,, 1 1 6H33,2H07 2,, E2H 1 -.,0-.420 Charges -/.2,3 1 1 122,13H 613L,2HL7 1 1 6127 33,321 42.403 1 1 13H,3E2 61L3,1HL7 1 1 6E2H7 11,233 --.103 &otal 4.31-.//3 31L,2,0 20,2H2 122,13H 613L,2HL7 62E2,3337 2,, 1 33,321 -.-2,.6,4 H,2,,0H 12,,3,, 13H,3E2 61L3,1HL7 6H33,2H07 2,, 1 11,233 -.646.021
92
Total principal amount is stated net of loans1related costs 1 $8'#!, as provided for in <T9 0esolution 8o. ,,3M0H, which approved technical pronouncement <(< 0H 6017 1 Transaction <osts and (remium on the Issue of 9ar*etable !ecurities. These costs are bro*en down in the table belowA
4-.,4.-/4, Ealue to %e recogni e* 123 123 133 ,L3 , , 13 4.445
4-.,4.-/4+estate* &otal cost E2, E2, 223 H02 11 11 22 4.0-&otal cost E2, E2, 223 H02 11 11 22 4.0--
ISS:E $ndes 'ireto -inem 1 .ight !esa $ndes 'ireto -inem W1 1 .ight !esa $ndes 'ireto (!I 1 .ight !esa $ndes 'ireto !ubcreditos 001M01H 1 .ight !esa $ndes 'ireto -inem 1 .ight #nergia $ndes 'ireto -inem W1 1 .ight #nergia $ndes 'ireto (!I 1 .ight #nergia &O&AL
Incurre* 9alue 232 232 23 222 3 3 2 3/1
The <ompany5s exposure to interest rate, foreign currency and li?uidity ris*s related to loans and financing is reported in 8ote 3E. <ovenants $radesco5s ban* credit certificates, loans with $anco !antander and with $8'#!, classified as current and non1current, re?uire that the <ompany maintains certain debt ratios and covenants. In 2013, the <ompany was in conformity with all re?uired debt covenants.
11) '#$#8T 0#! "8' -I8"8<I". <+"0&#!
Consoli*ate* Current Principal 'ebentures Eth Issue 6.ight !#!"7 'ebentures ,th Issue 6.ight !#!"7 'ebentures Lth Issue 6.ight !#!"7 'ebentures Hth Issue 6.ight !#!"7 'ebentures 2th Issue !eries " 6.ight !#!"7 'ebentures 2th Issue !eries $ 6.ight !#!"7 'ebentures 1st Issue 6.ight #nergia7 'ebentures 2nd Issue 6.ight #nergia7 'ebentures 3rd Issue 6.ight #nergia7 &O&AL 1 1 1 1 1 1 1 1 40 12 Charges 1 1 10,333 3,,32 12,32H E,0H3 E,10L 13,012 223 54./44 1 10,333 3,,32 12,32H E,0H3 E,10L 13,012 223 54./,/ &otal 12 1 3E2,2H0 E32,31H 22,,3,2 310,13L 1L1,E0L E23,3,3 22,H,3 ,.,60.,46 8on-current Principal H 1 3,2,213 EL3,1,L 1,00L,L,0 31E,223 1L,,,1E E32,3L, 30,0H2 ,.6//.,66 4-.,4.-/4, 2L &otal 4-.,4.-/4+estate* E2 20E,LLH 3,3,,LE EL2,2E2 1 1 1LE,E,3 E3,,2EE 30,01E 4.016./56
93
$elow, contractual conditions of debentures on a consolidated basis in the year ended 'ecember 31st, 2013A
Principal Amorti ation ;inancing Entit# 'ebentures Eth Issue 6.ight !#!"7 'ebentures Lth Issue 6.ight !#!"7 'ebentures Hth Issue 6.ight !#!"7 'ebentures 2th Issue !eries " 6.ight !#!"7 'ebentures 2th Issue !eries $ 6.ight !#!"7 'ebentures 1st Issue 6.ight #nergia7 'ebentures 2nd Issue 6.ight #nergia7 'ebentures 3rd Issue 6.ight #nergia7 $ate of signature 3M30M200, 0,M02M2011 HM2EM2012 3M1,M2013 3M1,M2013 0EM10M2011 22M12M2011 HM2EM2012 Currenc# T/.( <'I <'I <'I I(<" <'I <'I <'I Interest +ate p.a. T/.( W E) <'I W 1.3,) <'I W 1.1H) <'I W 1.1,) I(<" W ,.LE) <'I W 1.E,) <'I W 1.1H) <'I W 1.1H) Effecti9e +ate )eginning 2.00) 2.E2) 2.31) 2.2H) 11.22) 2.30) 2.31) 2.31) 2002 201, 201, 201H 2020 201, 2013 201, Pa#ment 9onthly "nnual "nnual +alf1annually +alf1annually "nnual "nnual "nnual En* 201, 2013 2023 2021 2023 2013 2012 2023
@n /une 2Hth, 2013, .ight !#!" conducted its 2th issue of unsecured, non1convertible debentures in two series, amounting to 0G1,300,000. @n /uly 22nd, 2013, the full extraordinary amorti%ation of the ,th Issue of 'ebentures of subsidiary .ight !#!" was performed, in the total amount of 0G131,,0L. The funds used in the amorti%ation were raised by .ight !#!" through its 2th Issue of 'ebentures. Thus, .ight !#!" early settled the ,th Issue, conducted on /anuary 22nd, 200L, at the total original value of 0G1,000,000, with original maturity in /anuary 201E. Total principal amount is reported net of debentures issue costs, as provided for in <T9 0esolution 8o. ,,3M0H, which approved the technical pronouncement <(< 0H 6017 1 Transaction <osts and (remium on the Issue of 9ar*etable !ecurities. These costs are bro*en down in the table belowA
4-.,4.-/4, ISS:E 'ebentures Eth Issue 6.ight !#!"7 'ebentures ,th Issue 6.ight !#!"7 'ebentures Lth Issue 6.ight !#!"7 'ebentures Hth Issue 6.ight !#!"7 'ebentures 2th Issue " 6.ight !#!"7 'ebentures 2th Issue $ 6.ight !#!"7 'ebentures 1st Issue 6.ight #nergia7 'ebentures 2nd Issue 6.ight #nergia7 'ebentures 3rd Issue 6.ight #nergia7 &O&AL Incurre* 9alue L,E31 12,EEH 1,22L E0 33H 132 E32 EHL 1, 23,3E0 1 1,32E 3H3 E,3EH 2,H22 3HL 1,3EE 1EE 11,E33 Ealue to %e recogni e* L &otal cost L,E3H 12,EEH 3,321 E23 E,2H3 2,221 HE2 1,H31 1,2 3E,LL3
4-.,4.-/4&otal cost L,E3H 12,EEH 3,321 E23 1 1 HE2 1,H31 1,2 23,L22
Installments related to principal of debentures, classified in non1current liabilities, have the following maturities 6financial charges not included7 on 'ecember 31st, 2013A
94
4-.,4.-/4, 201, 2013 201L 201H 2012 after 2012 &O&AL E,1,1H3 ,,H,233 1EL,332 32E,,03 32L,0H, 1,E00,33H ,.,60.,46
$elow, the debentures brea*down on a consolidated basis in the yearsA

Consoli*ate* Principal )ALA8CE O8 /4./4.-/4- - +estate* 'ebentures issued -inancial charges accrued -inancial charges paid 'ebenture amorti%ation -unding costs "morti%ation of funding costs <harges capitali%ed to intangible assetsMproperty, plant and e?uipment )ALA8CE O8 4-.,4.-/4- - +estate* 'ebentures issued 9onetary variation -inancial charges accrued -inancial charges paid 'ebenture amorti%ation -unding costs "morti%ation of funding costs <harges capitali%ed to intangible assetsMproperty, plant and e?uipment )ALA8CE O8 4-.,4.-/4, 4.020.01, ,00,000 1 1 6,2H,02E7 6,H27 2,23, 1 4.066.,/1,300,000 12,23L 1 1 6203,E2L7 6L,2LL7 3,E3H 1 ,.,60.,,, Charges ,,.300 1 1H,,,,, 6120,2,L7 1 1 1 1,2,, -0.151 1 22,,,3, 6213,33H7 1 1 1 12,332 54./44 &otal -.//,.31,00,000 1H,,,,, 6120,2,L7 6,2H,02E7 6,H27 2,23, 1,2,, 4.016./56 1,300,000 12,23L 22,,,3, 6213,33H7 6203,E2L7 6L,2LL7 3,E3H 12,332 ,.6//.,66
The <ompany5s exposure to interest rate and li?uidity ris*s related to debentures is reported in 8ote 3E.
95
<ovenants The Lth, Hth and 2th issues of debentures of the subsidiary .ight !#!" and the 1st, 2nd and 3rd issues of debentures of the subsidiary .ight #nergia re?uire the maintenance of indebtedness indexes and coverage of interest rates. In 2013, the <ompany complied with all the covenants re?uired.
12) 0#& ."T@0F <+"0&#!

Consoli*ate* 4-.,4.-/4, 1 ,,202 1,E2H ,,,,EL 2-.336 4-.,4.-/4+estate* 2L,30H 21,022 L,2E2 ,3,130 444.142
C:++E8& -uel usage account ?uota B <<< #nergy development account ?uota B <'# &lobal reversal reserve ?uota B 0&0 <harges for capacity and emergency ac?uisition &O&AL
13) (0@TI!I@8!
The <ompany and its subsidiaries are parties in tax, labor and civil lawsuits and regulatory proceedings in several courts. 9anagement periodically assesses the ris*s of contingencies related to these proceedings, and based on the legal counsel5s opinion it records a provision when unfavorable decisions are probable and whose amounts are ?uantifiable. $elow is the balance of provisions, including provisions for ris*s and provisions for success fees for the years ended 'ecember 31st, 2013 and 2012A
4-.,4.-/4, &O&AL P+OEISIO8S .abor <ivil Tax @ther &O&AL Pro9ision 133,3H3 1E,,1H2 201,LLE 20,3,L 5//.1/, Success fees 1 20,2E3 22,003 1 6-.05&otal 133,3H3 133,13, 223,LH0 20,3,L 56,.255 Pro9ision 1L2,0H2 1H3,H,2 12L,032 23,1L2 53,.454-.,4.-/4- - +estate* Success fees 1 1E,E1H H,E,2 1 --.311 &otal 1L2,0H2 12H,2LL 20,,E21 23,1L2 2/2./-0
96
(rovisions for ris*sA (rovisions for ris*s and changes in 2013 and 2012 are as followsA
P+OEISIO8S ;O+ P+O)A)LE LOSSES )ALA8CE O8 /4./4.-/4- - +estate* "dditions "d4ustments :rite1offsMpayments :rite1offsMreversals )ALA8CE O8 4-.,4.-/4- - +estate* "dditions "d4ustments :rite1offsMpayments :rite1offsMreversals )ALA8CE O8 4-.,4.-/4, /udicial deposits 6a7 )ALA8CE O8 4-.,4.-/4,
6a7
La%or 45/.4-4 3,,1HL 3,,000 61L,L227 623,E2L7 410./311,301 63,,0007 6,,EH07 613,,207 4,,.,3,
Ci9il 42,.513,,,21 11,32E 6,3,H,E7 61EE7 43,.350 ,0,1,3 20,321 633,3,27 6E3,0227 465.430
&a" 432.613 1 10,,,E 1 1 401./,1,L0E 1,,E21 612,3H37 1 -/4.116
Other 45.5/1 12,H31 3,223 6H,1317 62H17 -,.410 1,02L E,23, 6L,0,07 61,10E7 -/.,51
&otal 545.213 113,332 30,EL1 6H2,LHE7 623,H,27 53,.453E,2,, ,,2LL 6HH,23,7 633,L137 5//.1/,
,6.121
2.-36
5/./5/
04.4/4
The total amount of 0G233,313 is recorded under escrow deposits on 'ecember 31st, 2013 60G22E,0L3 on 'ecember 31st, 20127, of which 0G21,101 60G,0,211 on 'ecember 31st, 20127 refer to claims with recorded provision. @ther deposits are basically related to labor 60G33,2,37, civil 60GL,,1L27 and tax 60G30,0H07 claims, and refer to lawsuits whose li*elihood of loss is possible or remote.
97
(rovision for labor proceedingsA These labor proceedings mainly involve the following mattersA overtime, ha%ardous wor* wage premium, e?ual pay, pain and suffering, difference of E0) fine of -&T! 6&overnment !everance Indemnity -und for #mployees7 derived from the ad4ustment due to understated inflation and occupational accident B civil liability. (rovision for civil proceedingsA
Accrue* Ealue >Pro%a%le Loss@ 4-.,4.-/4, <ivil proceedings !pecial civil court X<ru%adoX (lan &O&AL
6a7
6a7 6b7
4-.,4.-/411L,320 1L,1E2 E2,02L 43,.350
11E,322 1L,10L 13,L30 465.430
The (rovision for civil proceedings comprises lawsuits in which the <ompany and its subsidiaries are defendants and it is probable the claim will result in a loss in the opinion of the respective attorneys. The claims mainly involve alleged moral and property damage due to the <ompany5s ostensive behavior fighting irregularities in the networ*, as well as consumers challenging the amounts paid. .awsuits in the !pecial <ivil <ourt are mostly related to matters regarding consumer relations, such as improper collection, undue power cut, power cut due to delin?uency, networ* problems, various irregularities, bill complaints, meter complaints and problems with ownership transfer. There is a limit of E0 minimum monthly wages for claims under procedural progress at the !pecial <ivil <ourt. "ccruals are based on the separation of the six main reasons for complaints for the <ompany and its subsidiaries B which represent L2.E) of the lawsuits filedD a bloc* with all the reasons related to accidentsD and a bloc* for other reasons. -or the six main offenders and other reasons bloc*, an ad4usted average is used B considering 2,) of the sample i.e. excluding the 2.,) highest and lowest amounts 1 the average of the last 12 months of condemnation amount. In case of the accident bloc*, the average of the last 12 months of condemnation amount is considered.
6b7
98
(rovision for tax proceedingsA

Accrue* Ealue >Pro%a%le Loss@ 4-.,4.-/4, I8!! B tax deficiency note I8!! B ?uarterly I<9! 6a7 @ther &O&AL
6a7
4-.,4.-/4EE,3LH 2E,H23 112,H2H 1E,233 401./,-
E,,L31 2,33L 122,LH2 13,H3E -/4.116
The provision recorded mainly refers to litigation on the application of !tate .aw n] 3,1HHM22, which restricted the appropriation of I<9! credits incurred on the ac?uisition of assets destined to fixed assets, re?uiring that credit occurs by installments, while this restriction was not provided for in the !upplementary .aw n] HLM23.
@ther (rovisionsA The <ompany will now discuss regulatory contingencies of its subsidiaries in connection with administrative issues pending with "8##.A
'eficiency 8otice "8##. 8o. 0L1M2011 1 !-# B This deficiency notice was issued on 8ovember 30th, 2011 under the argument that any failure to comply with 9odule H B (0@'I!T 6(rocedures for the 'istribution of #lectric (ower at the 8ational #lectric !ystem7, more specifically referring to the process of data collection and calculation of individual and collective continuity indicators, as well as financial indemnity owed to consumers whose individual continuity indicators were infringed. "8##. applied a fine in the relevant amount of 0G1L,L12. !ubsidiary .ight !#!" filed an appeal on -ebruary 3th, 2012, in view of excessive penalty applied, contesting among the facts, lac* of reasoning and proportionality of dosimetry applied when calculating the fine. In view of the maintenance of excessive penalty applied and the chances of partial success of appeal filed, .ight !#!" accrued 0G3,332 60G,,H,L on 'ecember 31st, 20127, through report of its legal counsels and awaits decision of "8##.D 'eficiency 8otice "8##. 8o. 102M20121!-# 6proceeding EH,00.00,021M20111237. The 'eficiency 8otice was received by the subsidiary .ight !#!" on /une 2Hth, 2012, under the allegation of non1compliance detected by "8##. in "ugust 2011 through an inspection of the subsidiaryQs underground networ*. The fine is 0GL,E3H. The appeal was sent by .ight !#!" on /uly 3th, 2012 and the fine was upheld by "8##.. .ight !#!" paid this fine on 9ay 2nd, 2013.
(rovisions for success feesA 9anagement periodically reassesses lawsuits with success fees for legal advisors and, based on the opinion of its legal counsel for the ris*s of loss, records provisions for lawsuits whose li*elihood of loss was considered possible or remote. $elow is a chart with the position and changes in the years ended 'ecember 31st, 2013 and 2012.
99
P+OEISIO8S ;O+ S:CCESS ;EES )ALA8CE O8 /4./4.-/4- - +estate* 0emote losses )ALA8CE O8 4-.,4.-/4- - +estate* (ossible losses 0emote losses )ALA8CE O8 4-.,4.-/4,
Ci9il 46./6/ 3LH 46.643 1E,,LH 6H,0,07 -/.062
&a" 0.4-4 63327 3.650 13,H0H 62317 --.//2
&otal -,.424 62HE7 --.311 2H,3H3 6H,3117 6-.05-
20) <@8TI8&#8<I#!
The <ompany is a party to lawsuits that 9anagement believes that ris* of loss are less than probable, based on the opinion of its legal counsels. Therefore, no provision was established. <ontingencies with possible loss are bro*en down as followsA
Consoli*ate* 4-.,4.-/4, )alance <ivil .abor Tax &O&AL 333,113 2H1,0L1 3,302,L00 6.--2.336 8um%er of Procee*ings 1E,03, 1,033 E32 45.5/1 4-.,4.-/4- - +estate* )alance 20E,202 221,,L, 3,23H,200 ,.126.211 8um%er of Procee*ings 13,L22 1,0L2 213 45./11
The main reasons for litigations are listed belowA a7 <ivil
Irregularities B !ubsidiary .ight !#!" has several lawsuits where irregularities are discussed, arising from commercial losses due to irregular connections, clandestine connections, meters alteration and e?uipment theft, *nown in (ortuguese as =gatos>. 9ost of the litigations are based on the evidence of irregularity and amounts charged by the concessionaire in view of such evidence. The amount currently assessed represented by these claims is 0G3H,H,3 60GE,,1,E on 'ecember 31st, 20127. "mounts charged and bills B 9any litigations are currently in progress and discuss amounts charged by the subsidiary .ight !#!" for services provided, such as demand amounts, consumption amounts, financial charges, rates, insurances, among other. The amount currently assessed represented by these claims is 0GEH,322 60G3E,1EH on 'ecember 31st, 20127. "ccidents B !ubsidiary .ight !#!" is defendant in lawsuits filed by victims andMor their successors, regarding accidents with .ight5s electric power grid andMor service provision for
100
several causes. The amount currently assessed represented by these claims is 0G30,321 60G2E,EL, on 'ecember 31st, 20127.
'iscontinuance and suspension B There are several lawsuits in progress to discuss service discontinuance, whether by fortuitous cases or events of force ma4eure, or for purposes of intervention in the electrical system, among other reasons, and also service suspension, whether for indebtedness, denied access or meters replacement, among other facts for suspension. The amount currently assessed represented by these claims is 0G13,0L3 60G1,,21H on 'ecember 31st, 20127. #?uipment and networ* B !ubsidiary .ight !#!" has litigations due to electronic meters used to measure energy consumption. .itigations address several themes, such as meter functionality, approval by metrological agency, among others and, also, litigations about its networ*, due to its extension, removal or even financial contribution of the client to install the networ*. The amount currently assessed represented by these claims is 0GL,210 60GL,E3E on 'ecember 31st, 20127. 0egarding civil litigations, we point out the lawsuit filed in the first ?uarter of 2012 by <ompanhia !ider^rgica 8acional 1 <!8 against subsidiary .ight !#!", where <!8 claims approximately 0G100,000 as indemnity for service discontinuance occurred at its <onsumer nit of Tolta 0edonda. :e point out that out of amount claimed, 0GHH,L00 only refer to the service discontinuance occurred on 8ovember 10th, 2002, affecting E0) of $ra%ilian territory and over 20) of (araguay, which only evidences that causes go beyond .ight !#!"5s scope of operation, as electric power distribution company. 9oreover, the @8! report concluded that the origin and causes of this service discontinuance was -urnas5 responsibility. Thus, the <ompany5s exposure to ris* is 0G3,,,31 60G3,,,31 on 'ecember 31st, 20127. The subsidiary .ight !#!" entered into an agreement with a plaintiff in a proceeding related to the 9unicipal 0eal #state Tax 6I(T 7, in which the opposing party5s attorney is pleading the payment attorneys5 fees. The <ompany understands that these fees are not due. The amount currently ?uantifiable is 0G13,1,3. b7 Tax
I<9! <ommercial .osses 6Tax 'eficiency 8otices 8os. 03323LH01H, 0E0112E21L and 0E.02H.L,2137 1 These refer to tax deficiency notices aiming at collecting I<9!, &overnment -und to <ombat (overty 1 -#<( and penalty 6from /anM22 to 'ecM2003 and /anM03 to 'ecM107 as .ight !#!" failed to pay deferred I<9! and -#<( in operations preceding the distribution of electric power, i.e., in operations carried out between generation and distribution company, in view of commercial losses. The subsidiary .ight !#!" ob4ected these tax assessments. Two tax deficiency notices are pending 4udgments in the lower administrative court and other two notices received unfavorable decisions in the lower administrative court, against which .ight !#!" filed voluntary appeals. The amount currently assessed represented by these claims totaled 0G1,322,200 60G1,2L3,200 on 'ecember 31st, 20127. I00- 6withholding income tax over dividends7 6(roceedings 133H2.L2112,M2011102 and 133H2.L203,LM20121EL7 B In 2011, subsidiary .ight !#!" received a tax deficiency notice
101
aiming the collection of withholding income tax 6I00-7 over amounts paid by the <ompany in 200L as dividends, under the allegation that these derived from no profit, originated from recording of deferred tax assets in the income statement, then, characteri%ed as payments without cause sub4ect to tax levy. In view of regular standing of accounting, corporate and tax procedures adopted, the <ompany filed ob4ection, which was deemed groundless. The <ompany filed a Toluntary "ppeal, which is pending 4udgment. @n /uly 3th, 2012, .ight !#!" received another tax deficiency notice on this matter, now concerning the amounts paid in 200H, against which submitted a statement of discontentment, under the alleged defense of previous deficiency notice, which was dismissed. " Tolunteer "ppeal is pending decision. The amount currently assessed represented by first deficiency notice is 0G3L,,300 60G332,,00 on 'ecember 31st, 20127 and 0G23,,E00 for the second deficiency notice 60G22L,200 on 'ecember 31st, 20127.
.I0M.@I 1 I0(/M<!.. B 6(roceedings 133H2.L20213M20101H3, 1,3LE1001.L,LM200H113 and 133H2.L21021M20111207 B The subsidiary .ight !#!" filed a writ of mandamus mainly discussing the taxation of profit of the subsidiaries .I0 and .@I abroad, more specifically, it advocated that income tax and social contribution should be levied on profit only, not on the positive results of e?uity method investments 6a broader concept that includes exchange variations as provided for by I8 213M027. The decision was unfavorable to the .ight !#!" and, subse?uently, due to 0efis, it fully waived the right claimed in the proceeding. "ccordingly, the procedure has been changed to tax the positive results of e?uity method investments, in accordance with the decision of the writ of mandamus. Tax authorities disagreed with this procedure and issued a deficiency notice to .ight !#!" for the fiscal years 200E to 200H, re?uiring taxation on profit only. -or 200E, a tax foreclosure case has been filed and is pending 4udgment of the motion to stay execution. -or 200,, the voluntary appeal was sustained and the tax deficiency notice was canceled. -or the amounts relating to 2003 to 200H, the <ompany is awaiting the decision of the Toluntary "ppeals by the "dministrative Tax "ppeals <ouncil 6<"0-7. "ccording to the legal counsels, the ris* of loss is classified as possible and the amount is 0GEE3,100 60GE23,113 on 'ecember 31st, 20127. 8ormative Instruction 68I7 8o. H3 6(roceeding 10L0L000L,1M200L11, 1 62003 through 200,7 1 This deficiency notice was issued to assess a fine on the <ompany for alleged failure to ma*e electronic filings as re?uired by 8I. 8o. H3M2001, for calendar years 2003 through 200,. The voluntary appeal filed by subsidiary .ight !#!" was dismissed, upon which a special appeal was filed and also deemed groundless. 9otion for clarification of 4udgment is pending. The amount currently assessed represented by this claim is 0G302,,00 60G22E,E00 on 'ecember 31st, 20127. Inspection -ee for @ccupancy and (ermanence in Kones, 0outes and (ublic "reas 6T-@(7 B The subsidiary .ight !#!" has several lawsuits discussing T-@(, levied by the municipality of $arra 9ansa. .ight !#!" filed motion to dismiss the execution of these lawsuits and at the -ederal !upreme <ourtB !T-, obtained in4unction sentencing the suspension of collections until 4udgment of #xtraordinary "ppeal nc 3E02H3. The amount currently assessed represented by this claim is 0G2,3,E2L 60G1L2,302 on 'ecember 31st, 20127. I<9! 0heem 6(roceeding #10EMH22.020M227 1 This is a tax deficiency notice to collect I<9! 6!tate T"T7, in view of subsidiary .ight !#!"Qs utili%ation of I<9! accumulated credits of
102
0heem #mbalagens .tda. to ac?uire inputs and raw material in the state of 0io de /aneiro. @b4ection was deemed groundless. Toluntary "ppeal was filed which was re4ected. .ightQs appeal was also filed which was re4ected. "t the moment, the subsidiary is awaiting the decision in order to ta*e the proper measures. The amount currently assessed represented by this claim is 0G1E,,200 60G13L,232 as at 'ecember 31st, 20127.
I<9! on low1income subsidy 6(roceedings #13EM0,2.1,0M200E and #10EM0,E.L,3M20117 1 Tax 'eficiency 8otices drawn up to charge I<9! 6!tate T"T7 on amounts of economic subsidy to low1income consumers of electric power arising from &lobal 0eversal 0eserve -unding. In the first case, .ight !#!"Qs ob4ection was deemed groundless. "n appeal was lodged by subsidiary .ight !#!" with the Taxpayers <ouncil, which was partially sustained to remove taxation on consumption up to ,0 *:h 6exempt from tax7. In the second case, the <ompany filed an ob4ection, which was deemed groundless. "n appeal was lodged with the Taxpayers <ouncil, which decided that this case shall return to the inspection authority for further information. The amount currently represented by the first claim is 0G2,,300 60GHH,300 as at 'ecember 31st, 20127 and the second claim is 0G3,,000 60G32,200 as at 'ecember, 31st, 20127. c7 .abor
The main labor claims involveA e?ual pay and related accretions, overtime and related accretions, occupational accident, ha%ardous wor* wage premium and pay and suffering.
103
#ach claim is detailed belowA
#?ual pay and related accretions B the claimants intend to receive wage differences alleging that they exercise or exercised activities identical to other employees5 or former employees5 activities, with the same productivity and technical perfection, but they received different wages. The amount currently assessed represented by this claim is 0G1H,HE, 60G2E,321 on 'ecember 31, 20127. @vertime and related accretions B the claimants intend to receive overtime pay, alleging that they performed their activities beyond standard wor*ing hours and overtime has not been paid or offset. The amount currently assessed represented by this claim is 0G31,122 60G,H,31L on 'ecember 31st, 20127. @ccupational accident B employeesMformer employees or service providers involved in occupational accidents attribute responsibility to .ight, claiming indemnifications and life annuity. The amount currently assessed represented by this claim is 0G13,E22 60G1E,320 on 'ecember 31st, 20127. 0is* premium difference B in the past, the <ompany used to pay a 30) difference of base salary up to "pril 2012, as per 2011M2012 <ollective $argaining "greement. The amount currently assessed represented by this claim is 0G,L,001 60GL2,LL3 on 'ecember 31st, 20127. (ain and suffering B claim based on several groundsA persecution, moral harassment, lac* of security 6operations in ris* area7 and others. The amount currently assessed represented by this claim is 0G3H,22, 60G3,,,EL on 'ecember 31st, 20127.
$elow, we point out lawsuits in progress, whose chances of losses are remote, with relevant amounts under dispute, which, in case of unfavorable decision, may impact the <ompany, its subsidiaries and 4ointly1controlled entitiesA
("!#(M(I! 6(roceeding 1,3LE002130M200311H7 B It refers to the @ffset 'isallowance made by the <ompany of ("!#( credits with (I! debts. The <ompany5s ob4ection was deemed groundless. Toluntary "ppeal was filed. <"0- rendered decision sentencing the case should remand to the lower court to determine the credit in dispute. The amount currently assessed represented by this claim is 0G2L2,E00 60G23,,200 on 'ecember 31st, 20127.
104
I00- 1 'isallowance of tax offset 1 .I0M.@I 6(roceeding 10L3H.002.E3,M200E1117 1 There is no confirmation from $ra%ilian Tax "uthority regarding the tax offsets related to withholding income tax credits on financial investments and withholding income tax credits on the payment of energy accounts by government bodies, offset due to outstanding balance of <orporate Income Tax in the reference year of 2002. The motion to disagree filed by .ight !#!" subsidiary was deemed groundless. The voluntary appeal lodged by .ight !#!" is pending 4udgment. In view of the favorable decision received in "ugust 2012 referring to the proceeding 1HEL1002113M200E102, which directly impacts this case, the legal counsels changed the chances of losses to remote. The amount currently assessed represented by this claim is 0G211,H00 60G20E,H00 on 'ecember 31st, 20127.
The <ompany does not consider the other proceedings as individually significant for disclosure purposes.
21) (@!T1#9(.@F9#8T $#8#-IT!

.ight &roup5s companies sponsor -undaNPo de !eguridade !ocial $raslight 6$raslight7, a nonprofit closed pension entity, whose purpose is to provide retirement benefits to the <ompany5s employees and pension benefits to their dependents. $raslight was incorporated in "pril 12LE and has four plans 1 ", $, < and ' B established in 12L,, 12HE, 122H and 2010, respectively, and plan < received migration from about 23) of the active participants of plans " and $. <urrent plans in effect include defined1benefit1 6(lans " and $7, mixed1benefit1 6(lan <7, and defined1 contribution plans 6(lan '7. $elow, a summary of the <ompanyQs liabilities involving pension plan benefits as stated on its balance sheetA
Consoli*ate* 4-.,4.-/4, Current <ontractual debt with pension fund "dditional actuarial liabilities <T9 32,M12 @ther &O&AL 1,22E,333 1 L0 4.--6.1,2 8on-current 1 1 1 &otal 1,22E,333 1 L0 4.--6.1,2 Current 11E,H3, 1 1,2L2 442.4/1 4-.,4.-/4- - +estate* 8on-current 232,H33 31E,L3H 1 4.-56.2,4 &otal 1,0,E,32H 31E,L3H 1,2L2 4.,1/.1,3
@n @ctober 2nd, 2001, the $ureau of !upplementary (ension (lans approved an agreement for the purpose of balancing accounting deficits and refinancing of repayable reserves, which began to be paid out in 300 monthly as of /uly 2001. "s of 'ecember 31st, 2013, there were 1,0 monthly installments remaining, in a total contract outstanding amount of 0G1,22E,333, restated by the I(<" consumer price index 6with one1month lag7 and actuarial interest at the rate of 3) p.a. @n 'ecember 31st, 2013, the <ompany entered into (rivate Instruments of Termination upon the settlement of the agreements to resolve the technical deficit and refinance the unamorti%ed reserves with $raslight. These (rivate Instruments of Termination established the payment of all outstanding
105
balances of the agreements, calculated on 'ecember 31st, 2013, in the amount of 0G1,22E,333, up to -ebruary 1Eth, 201E, ad4usted by the <'I rate variation. "lso on 'ecember 31st, 2013, the <ompany, in view of the increase in population longevity and <8(< 0esolution 2, of 8ovember 22th, 2012, that provides for a reduction in the interest rate used in the actuarial assessments of the benefit plans managed by private supplementary pension entities of 0.2,) p.a. until 201H, entered into (rivate Instruments of "ssumption of @bligation sub4ect to <ondition and Term with $raslight, assuming exclusive responsibility for the coverage of any accumulated deficit to be recogni%ed in the financial statements of $raslight at the end of each year, until 201H, arising exclusively from the change in the mortality table or the reduction in the discount rate as a result of a legal or normative imposition. The deficit exceeding the limits provided for in the (rivate Instruments of "ssumption of @bligation sub4ect to <ondition and Term shall be covered by the participantsMbeneficiaries and by the <ompany pursuant to the prevailing law. $elow, contractual liabilities brea*down in 2013 and 2012A
Consoli*ate* Current )ALA8CE O8 /4./4.-/4- - +estate* "morti%ations in the year 0estatements in the income statement of the year 0estatements in the statement of comprehensive income Transfer to current )ALA8CE O8 4-.,4.-/4- - +estate* "morti%ations in the year 0estatements in the income statement of the year 0estatements in the statement of comprehensive income Transfer to current )ALA8CE O8 4-.,4.-/4, 1/.201 6111,2E17 120,032 613,02E7 ,2,03E 446.3,5 611L,1007 122,03, 13,,033 232,H33 4.--6.222 8on-current 004.301 1 1 1 6,2,03E7 0,0.32, 1 1 1 6232,H337 &otal 4./2-.506 6111,2E17 120,032 613,02E7 1 4./56.203 611L,1007 122,03, 13,,033 1 4.--6.222
106
a7 (lan description (lan "M$ 1 $enefits in these plans are Qdefined benefitsQ and correspond to the difference between application of certain percentage, between H0) and 100), of the average of the last 12 and the last 33 salaries, escalated as of the date the benefit began to be paid out, and the amount of the benefit paid by the I8!!, whichever is the highest. (lan < 1 'uring the capitali%ation phase, elective benefits are Qdefined1contributionQ benefits not lin*ed to I8!! benefits, and contingent benefits 6i.e. sic*ness allowance, permanent disability pension, pensions payable upon death of active, disabled, or sic* participants7, as well as continued income, once granted, are QdefinedQ benefits. The assets of the two portions are determined in shares. -or a participant migrating from (lan "M$ to (lan <, a settled lifetime income benefit was granted, reversible into a pension benefit, proportionate to the amount of contributions made to $raslight at migration time, as of the participantQs latest enrollment in the -undaNPo, which is deferred until the participant has satisfied a number of ?ualification re?uirements. This portion is called the (lan < !ettled 'efined $enefit !ubplan. (lan ' 1 This plan was approved by the 9inistry of !ocial !ecurityQs 8ational $ureau of !upplementary (ension 6(0#TI<M9(!7 on 9arch 22nd, 2010, with the first contribution made in "pril 2010. In this plan, benefits are Qdefined contributionQ benefits before and after the relevant grant. $elow, consolidated actuarial informationA
4-.,4.-/4, (resent value of actuarial liabilities (lan assetsQ fair value "ddition 1 debt with $raslight 8E& LIA)ILI&IES 8et liabilities, <T9 32,M12 $alance of agreement ad4usted with $raslight 62,02L,3,37 1,22L,H12 63,E,H327 61,22E,3337 6H32,H3E7 61,22E,3337 4-.,4.-/4+estate* 62,3H,,,2,7 1,313,122 1 61,332,E337 61,332,E337 61,0,E,32H7
<hanges in plan assets5 fair value are as followsA

4-.,4.-/4, -air value of assets at the beginning of the year Interest on the fair value of the planQs assets "ctuarial gains6losses7 on the planQs assets !ponsorQs contributions (articipantsQ contributions $enefit paid by the planMcompany ;AI+ EAL:E O; ASSE&S A& &=E E8$ O; &=E DEA+ 1,313,122 10,,0E3 6H3,0HH7 11H,32H ,2 622,,L1,7 4.--1.340 4-.,4.-/4+estate* 1,132,12H 112,13L 12L,H23 113,22, ,, 6213,3027 4.,42.4-0
107
<hanges in defined1benefit liabilities present value are as followsA
4-.,4.-/4, -air value of liabilities at the beginning of the year <ost of current service Interest on actuarial liabilities (articipantsQ contributions 0ecorded actuarial gainsM6losses7 $enefits paid ;AI+ EAL:E O; LIA)ILI&IES A& &=E E8$ O; &=E DEA+ 2,3H,,,2, 2L2 213,E0E ,2 6,L3,3327 622,,L1,7 -./01.25,
4-.,4.-/4+estate* 2,2,,,EH2 2E1 22H,002 ,, E1E,E1L 6213,3027 -.235.505
"mounts recogni%ed in the income statement, in operating costs and expenses and financial income, are as followsA
4-.,4.-/4, <ost of current service Interest on actuarial liabilities Interest on the fair value of the planQs assets 0estatement of $raslightQs debt ES&IMA&E$ EKPEC&E$ COS& 2L2 213,E0E 610,,0E37 12,32, 4--./,5 4-.,4.-/4+estate* 2E1 22H,002 6112,13L7 10,233 4-/./20
<hanges in net liability are as follows:

4-.,4.-/4, 8et liability at the beginning of the year #xpenses recogni%ed in the income statement "mounts recognised in @<I <ontributions paid Inflow 6outflow7 of net transfers "ddition 1 debt with $raslight, in @<I 8E& LIA)ILI&D A& &=E E8$ O; &=E DEA+ 1,332,E33 122,03, 6E20,0HL7 611L,1007 61E,EH07 3,E,H32 4.--6.222 4-.,4.-/4+estate* 1,0H3,313 120,032 30L,0E2 6111,2E17 632,02E7 1 4.,20.622
108
#xternal actuary5s estimate for expense to be recogni%ed in 201E is as follows:

-/46 <ost of current service Interest on actuarial liabilities #xpected return on the planQs assets 232 232,1H3 6202,22E7 30,22E
The plan assets5 main categories, as percentage of total plan assets, are as follows:
4-.,4.-/4, -ixed income #?uities 0eal property @ther EKPEC&E$ COS& ES&IMA&E$ L2.L1) 13.H,) H.EE) 2.00) 100) 4-.,4.-/4+estate* LE.32) 13.30) L.2,) 1.13) 100)
The effective return on plan assets amounted to 0G1H,2,2 in 2013 60G2E3,230 on 'ecember 31st, 2012). "ctuarial considerations:
4-.,4.-/4, 8ominal interest rate 6discount7 at present value of actuarial liabilities #xpected rate of return on nominal plan assets "nnual inflation rate !alary growth rate "d4ustment index of continued benefits <apacity factor 0evolving rate &eneral mortality table 617 'isability table 6plans "M$7 'isability table 6plan < settled7 9ortality table of disabled people "ctive participants 0etiree and pensioner participants
617
4-.,4.-/4+estate* H.23) H.23) E.,0) L.01) E.,0) 2H.00) $ased on age "T 1 H3 .I&+T 1 !trong .I&+T 1 !trong I"($ 1 ,L 3,E,2 ,,3L1
11.33) 11.33) ,.00) L.33) ,.00) 2H.00) $ased on age "T 1 H3 .I&+T 1 !trong .I&+T 1 !trong I"($ 1 ,L 2,300 ,,3H,
Table without aggravation
109
22) @T+#0 ("F"$.#!

Consoli*ate* 4-.,4.-/4, Current "dvances from clients <ompensation for use of water resources #nergy 0esearch <ompany B #(# 8ational !cientific and Technological 'evelopment -und B -8'<T #nergy #fficiency (rogram B (## 0esearch and 'evelopment (rogram B 0R' (ublic lighting fee se of public asset 1 $( 0eserve for reversal @ther 6a7 &O&AL 6a7 1,312 3,H3L 1,LH2 2,,1, 3,,,33 2,,001 EL,321 1 1 33,EH2 43,.321 8on-current 1 1 1 1 1 1 1 1 L0,320 ,,LL0 12./0/ &otal 1,312 3,H3L 1,LH2 2,,1, 3,,,33 2,,001 EL,321 1 L0,320 E2,2,2 -50.051 4-.,4.-/4- - +estate* Current 1,H1H E,033 3,013 2H3 EL,1H3 22,HL, 31,0H0 3,123 1 E3,,E3 40/.1,, 8on-current 1 1 1 1 1 1 1 30,L3E 32,233 ,,LHH 4/2.635 &otal 1,H1H E,033 3,013 2H3 EL,1H3 22,HL, 31,0H0 33,2,L 32,233 ,2,33E -01.-43
0elated to other sundry payables
2.) 0#."T#'1("0TF T0"8!"<TI@8!

@n 'ecember 31st, 2013, .ight !.". pertained to the controlling group <ompanhia #nergItica de 9inas &erais B <#9I&, .uce #mpreendimentos e (articipaNOes !.". and 0io 9inas #nergia (articipaNOes !." 609#7 B company controlled by 0edentor #nergia !.". Interest in subsidiaries and 4ointly1controlled entities is outlined in the 8ote 2. $elow, a summary of related1party transactions occurred in the years ended 'ecember 31st, 2013 and 2012A
110
4-.,4.-/4, +eference (urchase of electric power .ight !#!" x <#9I& (urchase of electric power .ight !#!" x <#9I& !ale of electric power .ight #nergia x <#9I& <harge for the use of the system .ight !#!" x <#9I& <harge for the use of the networ* .ight !#!" x <#9I& <harge for the use of networ* .ight #nergia x <#9I& !ale of electric power .ight &er x .ight #nergia !ale of electric power .ight &er x <#9I& <harge for the use of the networ* .ight !#!" x .ight &#0 <onsulting service .ight !#!" x "xxiom !ervice rendering .ight &#0 x .ight #nergia !ervice rendering .ight <om x .ight #nergia .iabilities of pension plan 1 1 Asset Lia%ilit# Asset
4-.,4.-/4Lia%ilit#
-/4, +e9enue >E"penses@ 6EE,00L7
-/4+e9enue >E"penses@ 6,3,0237
6"7
,,33L
H,203
6$7
2H2
2,2
62,1327
62,0,,7
6<7
LL2
2,32L
3,,E1
1,,323
6'7
1L1
133
1,102
2,032
6#7
3LH
1,,HH
63,2,H7
611,2E27
6-7
11
12
123
1E,
6&7
61,,1,L7
63,0LL7
6+7
1,EHE
61E,HLH7
610,,H37
6I7
2,
2,
23L
2,
6/7
,,2HL
1,3LE
62,20,7
6H,,337
6`7
2,HL3
2,HL3
6.7
697
1,22E,L33
1,3L0,L3H
6122,03,7
6120,0327
i. "greements executed with related partiesA 6"7 !trategic agreement 1 (urchase of electric power between .ight !#!" and <#9I&. $alance sheet groupsA Trade payables x Trade receivables 0elationshipA <#9I& 6party of the controlling group7 @riginal amountA 0G31E,0E2 'urationA /anM2003 to 'ecM203H Terms of agreementA (rice established in the regulated mar*et <onditions of termination or expirationA 30) of remaining balance 0emaining balanceA 0G 222,223 6$7 !trategic agreement 1 (urchase of electric power between .ight !#!" and <#9I& $alance sheet groupsA Trade payables x Trade receivables
111
0elationshipA <#9I& 6party of the controlling group7 @riginal amountA 0G3L,300 'urationA /anM2010 to 'ecM2032 Terms of agreementA (rice established in the regulated mar*et <onditions of termination or expirationA 30) of remaining balance 0emaining balanceA 0G,H,2H2 6<7 !trategic agreement 1 !ale of electric power between .ight #nergia and <#9I& $alance sheet groupsA Trade payables x Trade receivables 0elationshipA <#9I& 6party of the controlling group7 @riginal amountA 0G1,3,232 'urationA /anM200, to 'ecM2013 Terms of agreementA (rice established in the regulated mar*et <onditions of termination or expirationA 8M" 0emaining balanceA 0G0 6'7 !trategic agreement B <ollection of distribution system usage charges between .ight !#!" and <#9I& $alance sheet groupsA Trade payables x Trade receivables 0elationshipA <#9I& 6party of the controlling group7 @riginal amountA 8M" 'urationA as of 8ovM2003 Terms of agreementA (rice established in the regulated mar*et <onditions of termination or expirationA 8M" 0emaining balanceA 0G1L1 6#7 !trategic agreement B <ommitment to the basic electric networ* usage charges between .ight !#!" and <#9I& $alance sheet groupsA Trade payables x Trade receivables 0elationshipA <#9I& 6party of the controlling group7 @riginal amountA 8M" 'urationA as of 'ecM2002 Terms of agreementA (rice established in the regulated mar*et <onditions of termination or expirationA 8M" 0emaining balanceA 0G3LH
112
6-7 !trategic agreement 1 <ommitment to the basic electric networ* usage charges between .ight #nergia and <#9I& $alance sheet groupsA Trade payables x Trade receivables 0elationshipA <#9I& 6party of the controlling group7 @riginal amountA 8M" 'urationA as of 'ecM2002 Terms of agreementA (rice established in the regulated mar*et <onditions of termination or expirationA 8M" 0emaining balanceA 0G 11 6&7 !trategic agreement B !ale of electric power between .ightger and .ight #nergia $alance sheet groupsA Trade payables x Trade receivables 0elationshipA .ightger 64ointly1controlled entity7 @riginal amountA 0G21L,213 'urationA 'ecM2002 to /anM202H Terms of agreementA mar*et price <onditions of termination or expirationA 8M" 0emaining balanceA 0G1L,,LE, 6+7 !trategic agreement 1 !ale of electric power between .ightger and <#9I& $alance sheet groupsA Trade payables x Trade receivables 0elationshipA <#9I& 6party of the controlling group7 @riginal amountA 0G20H,H1H 'urationA 'ecM2010 to /unM202H Terms of agreementA (rice established in the regulated mar*et <onditions of termination or expirationA 8M" 0emaining balanceA 0G1,EHE 6I7 !trategic agreement B <ommitment to the basic electric networ* usage charges between .ight !#!" and .ightger $alance sheet groupsA Trade payables 0elationshipA .ightger 6under common control7 @riginal amountA 8M" 'urationA as of 'ecM2010. ndetermined duration. Terms of agreementA mar*et price <onditions of termination or expirationA 8M" 0emaining balanceA 0G2,
113
6/7 !trategic agreement B <onsulting services between .ight !#!" and "xxiom $alance sheet groupsA @ther payables 0elationshipA .ight "xxiom 6under common control7 @riginal amountA 8M" 'urationA as of 'ecM2010. ndetermined maturity. <onditions of agreementA I&(19 <onditions of termination or expirationA 8M" 0emaining balanceA 0G,,2HL 6`7 !trategic agreement B 0elated to services between .ightger and .ight #nergia. $alance sheet groupsA !uppliers 0elationshipA .ightger @riginal amountA 8M" 'urationA 'ecember 2012 to /une 201E <onditions of agreementA mar*et price <onditions of termination or expirationA 8M" 0emaining balanceA 0G2,HL3 6.7 !trategic agreement B 0elated to services between .ightcom and .ight #nergia. $alance sheet groupsA !uppliers 0elationshipA .ightcom @riginal amountA 0G3,1E2,2,2 'urationA 'ecember 2013 to 'ecember 2013 <onditions of agreementA mar*et price <onditions of termination or expirationA 8M" 0emaining balanceA 0G3,1E2,2,2 697 (ension (lan 1 -undaNPo de !eguridade !ocial B $raslight $alance sheet groupsA (ost1employment benefit 0elationshipA $raslight @riginal amountA 0G ,3,,0,2 'urationA /une 2001 to /une 2023 <onditions of agreementA I(<"W 3) p.a. <onditions of termination or expirationA 8M" 0emaining balanceA 0G1,22E,L33 The subsidiary .ight #nergia has a purchase contract of E00 9: of installed power capacity from the portfolio pro4ects of its 4ointly1controlled entity 0enova #nergia !."., and 200 9: to be made available as of 201, and 200 9: from 2013 to 2033.
114
0elated1party transactions have been executed in accordance with the agreements between the parties. ii. 9anagement remuneration (olicy regarding remuneration of the $oard of 'irectors, #xecutive $oard and -iscal <ouncil 6consolidated7. (ro1rata share of each component to the aggregate remuneration for 2013.
Consoli*ate* -/4, )oar* of $irectors -ixed remuneration 6)7 Tariable remuneration 6)7 @ther 6)7 &O&AL 100) 1 1 4//./ ;iscal Council 100) 1 1 4//./ )oar* of E"ecuti9e Officers 3H) 2H) E) 4//./ )oar* of $irectors 100) 1 1 4//./ -/4;iscal Council 100) 1 1 4//./ )oar* of E"ecuti9e Officers 3,) 2H) L) 4//./
0emuneration paid by the <ompany to the $oard of 'irectors, #xecutive $oard, and -iscal <ouncil in 2013A
Consoli*ate* -/4, )oar* of $irectors )oar* of E"ecuti9e Officers 3.// 256 ,E, 1 102 1 1 1 256 0.454 ,,3E, HH3 2,320 ,.366 3,1H2 332 ,31 4,.5-2 )oar* of $irectors -/4)oar* of E"ecuti9e Officers 3.,, 225 ,,E 1 111 1 1 1 225 0.-46 ,,32L 1,01H 2,H32 ,.012 3,2L3 1 2L3 46.422
;iscal Council
&otal
;iscal Council
&otal
8:M)E+ O; MEM)E+S >a@ ;IKE$ +EM:8E+A&IO8 I8 &=E DEA+ !alary or pro1labore 'irect and indirect benefits @ther $onus @ther $enefits arising position termination &O&AL +EM:8E+A&IO8 PE+ )O$D
6b7
-4.64.255 1,3L2 1 2L3 1 1 1 4.255
4/.//
,0.644.62/ L,,32 HH3 3,00, ,.366 3,1H2 332 ,31 45.3,5
-4.-5 4.546 1,232 1 2,2 1 1 1 4.546
4/.//
,0.53 44.,0, L,1E3 1,01H 3,232 ,.012 3,2L3 1 2L3 42.,65
EA+IA)LE +EM:8E+A&IO8 I8 &=E DEA+
115
"verage remuneration due to the $oard of 'irectors, #xecutive $oard, and -iscal <ouncil in 2013A
Consoli*ate* -/4, )oar* of $irectors 8:M)E+ O; MEM)E+S >a@ +ighest individual compensation 6b7 .owest individual compensation 6b7 "verage individual compensation 6b7
,a,b-
-/4)oar* of E"ecuti9e Officers 3.// 103 ,3 3, 2,001 1,2EL 1,321 )oar* of $irectors -4.-5 10E ,2 L1 )oar* of E"ecuti9e Officers 3.,, H3 E1 3L 2,3,3 HH3 1,L01
;iscal Council 4/.//
;iscal Council 4/.//
-4.6132 33 LL
number o% members "al"ulated through the :eriod;s <eighted a$erage) in"luding o"ial e"urity and #=7 "harges)
@verall management remuneration in .ight !."., parent company, for the year of 2013 is 0G2,03,.
24) !+"0#+@.'#0!5 #C ITF

a7 <apital There are 203,23E,030 non1par and boo*1entry common shares of .ight !.". 6203,23E,030 on 'ecember 31st, 20127 as of 'ecember 31st, 2013, recorded as capital stoc* in the total amount of 0G2,22,,H22 60G2,22,,H22 on 'ecember 31st, 20127, as followsA
4-.,4.-/4, 8um%er of Shares 4/2.,/6.501 23,,L3,1,0 ,3,1,2,22H 23,,L3,1E2 01.2-0.62, 21,00,,20H L3,32E,2,, -/,.0,6./2/ A Interest 4-.,4.-/48um%er of Shares 4/2.,/6.501 23,,L3,1,0 ,3,1,2,22H 23,,L3,1E2 01.2-0.62, 2L,E,3,2H3 L0,1L,,EH0 -/,.0,6./2/ A Interest
S=A+E=OL$E+S CO8&+OLLI8( (+O:P 09# 0io 9inas #nergia (articipaNOes !.". <ompanhia #nergItica de 9inas &erais !.". .uce #mpreendimentos e (articipaNOes !.". O&=E+ $8'#! (articipaNOes !.". 1 $8'#!("0 (ublic OEE+ALL &O&AL
5-.413.03 23.03 13.03 61.33 10.30 3L.,H 4//.//
5-.413.03 23.03 13.03 61.33 13.EL 3E.E1 4//.//
.ight !.". is authori%ed to increase its capital up to the limit of 203,23,,0L2 common shares through resolution of the $oard of 'irectors, regardless of amendments to the bylaws. +owever, this increase is to occur exclusively upon the exercise of the warrants issued, strictly pursuant to the conditions of the warrants 6$ylaws, "rticle ,, (aragraph 37. b7 (rofit reserve .ight !.". has two profit reserves, as followsA
116
1 " !tatutory 0eserve set at the rate of ,) of the net income for each year, pursuant to the applicable law. 1 " 0etained #arnings reserve, which is recorded with the net income of previous years that remains after the appropriations in a capital budget approved by the <ompanyQs $oard of 'irectors. c7 #?uity Taluation "d4ustment The effects of the ad4ustment to fair value of property, plant and e?uipment are recogni%ed on the transition date for the adoption of I-0! on /anuary 1st, 2002, net of direct tax effects. The amounts recorded in this account are transferred to accumulated losses or retained earnings as the items are reali%ed. d7 @ther <omprehensive Income The <ompany recogni%es actuarial gains or losses arising from changes in actuarial assumptions, such as the mortality table, the discount rate of obligations and changes in the earnings of post1 employment benefit investments for defined benefits. The amounts presented are net of income tax and social contribution at a rate of 3E). <hanges in other comprehensive income are not recycled to profit or loss in subse?uent periods.
2/) 'ITI'#8'! "8' I8T#0#!T @8 #C ITF

The <ompanyQs bylaws provides for distribution of a minimum mandatory dividend at the rate of 2,) of the net income for the year, ad4usted pursuant to "rticle 202 of .aw 8o. 3,E0E dated 'ecember 1,th, 12L3. The payment of interest on e?uity is included in the calculation of the minimum mandatory dividends. "rticle 2 of .aw 8o. 2,2E2 of 'ecember 23th, 122,, allows deductibility for income tax and social contribution purposes, of interest on e?uity paid to shareholders, calculated based on the variation of the .ong1Term Interest 0ates 1T/.(, restricted to ,0) of the income for the year. The "nnual !hareholders5 9eeting held on "pril 23, 2013 declared dividends relating to the profit reserve recorded in the statement of financial position as at 'ecember 31st, 2012, totaling 0G21,LL0 6forty1five cents 60G0.E,7 per share7, paid on 'ecember 2Lth, 2013. @n "pril 30, 2013, the <ompany paid interest on e?uity, declared in 2012, in the gross amount of 0GH3,3L2, net of 0GLE,L22. @n 'ecember 13, 2013, the $oard of 'irectors approved the payment of interest on e?uity, in the gross amount of 0G10L,EL3 60G0.,3 per share7, sub4ect to 1,) withholding income tax. The payment was effected on 'ecember 2Lth, 2013.
117
The dividends originally proposed at the end of each year were calculated as followsA
CALC:LA&IO8 O; MI8IM:M MA8$A&O+D $IEI$E8$S 8et income for the year "bsorption of losses
-/4, ,HL,33, 1 ,HL,33,
-/4E23,223 6E2,,E37 3LE,3LL 61H,L127 ,55.253 HH,21, 233,2,, 6L1,3L37 6132,HLL7 22,L02 1,2,23H 61,,22,7 61H,L127 6E2,,E37 6132,0127 1 1 20,H00 1 12,102 -
0ecognition of legal reserve CALC:LA&IO8 )ASIS O; MI8IM:M MA8$A&O+D $IEI$E8$S 9inimum mandatory dividends 62,)7 8et income until !eptember 30 Interest on e?uity declared in !eptember Interim dividends resolved on the interim balance sheet of !eptember S:) &O&AL 8et income recorded in the fourth ?uarter Interest on e?uity declared in 'ecember 0ecognition of legal reserve on net income for the year "ccumulated losses deriving from changes in accounting practices Transfer of actuarial gainsMlosses recogni%ed in the statement of comprehensive income "dditional minimum mandatory dividends 1 2,) "dditional dividends proposed #?uity valuation ad4ustment 0eali%ation of other comprehensive income "bsorption of accumulated losses with retained earnings +E&AI8E$ EA+8I8(S
622,33L7 551.023 132,E22 E,H,32, 1 1 E,H,32, 122,010 610L,EL37 622,33L7 1 1 632,0127 6332,H127 22,0,H 1L1,22L 1 -10.14-
$elow, the brea*down of payable dividends and interest on e?uity balancesA
)ALA8CE O8 /4./4.-/4'ividends and interest on e?uity 0esolved at the "nnual !hareholdersQ 9eeting of 0E.11.2012 Interest on e?uity declared on 02.21.2012 Interim dividends on 11.23.2012 Interest on e?uity declared on 11.23.2012 :ithheld income tax 6I00-7 (aid in the year )ALA8CE O8 4-.,4.-/4'ividends and interest on e?uity 0esolved at the "nnual !hareholdersQ 9eeting of 0E.23.2013 "ddition to minimum mandatory dividends 1 2,) Interest on e?uity declared on 12.13.2013 :ithheld income tax 6I00-7 (aid in the year )ALA8CE O8 4-.,4.-/4,
1,.164
+FL S=A+E
1H1,,01 L1,3LL 132,HLL 1,,22, 611,HH07 6E2,,1127 16.10-
0.H200 0.3,00 0.H330 0.0L,0
21,LL0 32,012 10L,EL3 61E,1207 62,2,21,7 ,-./40
0.E,00 0.1,L0 0.,2L0
118
20) (0@-IT !+"0I8&

The <ompanyQs (rofit !haring (lan implemented in 122L spans the whole corporation and is essentially contingent upon consolidated net income and #$IT'" results of the <ompany. (ayment of the profit1sharing amount comprises two portions, a fixed and a variable one. The (rogram has evolved over the years in order to elicit increased employee commitment to improving the <ompanyQs and its subsidiariesQ bottom1lines. "s of 'ecember 31st, 2013 the balance of the provision for profit sharing, in estimated liabilities, was 0G3L,312 60G20,3E0 on 'ecember 31st, 20127, with payment expected to ta*e place in "pril 201E.
21) #"08I8&! (#0 !+"0#

(ursuant to the re?uirements of <(< E1 and the I"! 33 6#arnings per !hare7, the statement below reconciles the income for the period with the amounts used to calculated the basic and diluted earnings per share.
-/4, 8:ME+A&O+ 8et income for the year $E8OMI8A&O+ :eighted average number of common shares )ASIC A8$ $IL:&E$ EA+8I8(S PE+ COMMO8 S=A+E I8 +F 203,23E,030 -.33/ 203,23E,030 -./10 ,HL,33, E23,223 -/4-
In the 2013 and 2012 there are no differences between basic and diluted earnings per share.
119
22) 8#T 0#T#8 #

Consoli*ate* -/4, !upply 68ote 227 .eases, rents and other 0evenue from networ* usage 0evenue from construction 0evenue from services rendered <'# subsidy Taxed service fee (+OSS +EEE8:E I<9! (I! M <@-I8! @ther +EEE8:E &AKES -uel <onsumption "ccount 1 <<< #nergy 'evelopment "ccount 1 <'# &lobal 0eversal 0eserve 1 0&0 #nergy 0esearch <ompany 1 #(# 8ational Technological 'evelopment -und 1 -8'<T #nergy #fficiency (rogram 1 (## 0esearch and 'evelopment 10R' !pecial obligations @ther charges 1 (roinfa @ther charges 1 ex1isolated CO8S:ME+ C=A+(ES &O&AL $E$:C&IO8S 2,032,331 ,3,LLH 331,L32 H20,2HE 2E,123 L3,201 E,031 4/.13,.,4/ 62,23E,H137 621,,,H07 6,,EL17 >,.455.321@ 6H207 6L0,20H7 613,EH17 63,HH17 613,L327 62H,,307 613,L327 63E,L0L7 622,2337 1 >-/5.431@ >,.,24./56@ -/4- +estate* 2,L12,H20 30,212 L23,2L3 332,322 103,3,0 1 E,30, 44.,-/.-35 62,332,0,,7 62,H,2237 6,,2HE7 >,.,-2.-25@ 6322,,327 62,2,3EH7 6131,L307 63,HH37 613,L3H7 630,3327 613,L3H7 1 61,,0HH7 61H,20E7 >344.22/@ >6.4,1.0-5@
8E& +EEE8:E
1.6--.-52
1.43-.,2/
The <ompanyds revenue is influenced by temperature variation in its concession area. 'uring the summer, the revenue increases since cooling e?uipment is used more fre?uently.
120
23) #.#<T0I< (@:#0 ! ((.F

Consoli*ate* 8um%er of %ille* sales -/4,
>a@ >%@
(?h -/4,
>a@
+F -/4-/4, -/4+estate* 3,0E2,3E2 332,0H3 2,231,,3E H,022 ,,2,L32 11,,311 2EH,H33 1 2.504.421 2,323,H2L 10,,0H0 0./-/.466 ,LH,,2, 11E,0H1 20-.212 0.14-.3-/
-/4-
0esidential Industrial <ommerce, services and other 0ural (ublic sector (ublic lighting (ublic utility @wn consumption )ILLE$ SALES I<9! 6!tate T"T7 nbilled sales 6net of I<9!7 &O&AL S:PPLD
>c@
3,L3H,2H2 H,023 31,,E30 11,,0H 11,32L L,3 1,E,, E3, 6.443.4-/ 1 1 6.443.4-/ 1 1 6.443.4-/
3,3H3,2,3 10,2LL 310,E1L 11,EEH 11,E20 L30 1,EE2 E3L 6./,/.4-6 1 1 6./,/.4-6 1 1 6./,/.4-6
H,312 1,32, L,0H3 ,L 1,,2, 3HH 1,1,1 10L -/.,04 1 1 -/.,04 E,3L2 ELL 5.460 -5.56/
H,1E2 1,,2H 3,H,3 ,3 1,,H0 3H3 1,112 H3 -/./56 1 1 -/./56 E,H,0 23, 5.135 -5.3,0
2,HL2,0E2 22E,1LL 2,102,LH0 3,0E0 ,03,,3H 103,H2, 22H,H13 1 2.4-4.,45 2,12E,H3E 6H3,22L7 3.-,-.05LE3,HH2 H2,,2L 3,2.6/0 0./20.,24
#lectric power auction !hort1term energy &O&AL S:PPLD &O&AL
6a7 6b7 6c7
8ot revised by independent auditors 8umber of invoiced bills in 'ecember 2013, with and without consumption .ight !#!"
.0) @(#0"TI8& <@!T! "8' #V(#8!#!
Consoli*ate* Electric Power Costs -/4+estate* 1 1 1 63,HEH,2L37 1 1 1 1 1 >,.363.-1,@ 1 1 1 6E,1E,,1127 1 1 1 1 1 >6.465.44-@ Operation Costs -/4+estate* 6122,2H37 622,1EL7 6132,3H27 1 631E,2L17 1 1 6332,3227 63H,1H37 >4.6/2.-05@ Selling e"penses -/4+estate* 61L,0307 61,11H7 6LH,H207 1 623H7 62H2,3027 1 1 6HH37 >,34.5-6@ (eneral an* a*ministrai9e e"penses -/4, 6103,1317 61,H027 61,H,2327 1 63H,3L17 1 6,2,,3H7 1 6H0,23,7 >6,5.3,2@ -/4+estate* 6LE,2327 62,1217 61,H,2337 1 633,L037 1 6122,,,37 1 6L3,EH27 >5,5.4/6@
COS&S A8$ EKPE8SES (ersonnel and management 9aterial @utsourced services #lectricity purchased for resale 68ote 317 'epreciation and amorti%ation "llowance for doubtful accounts (rovision for contingenciesMsuccessM4udicial deposits <ost of construction @ther &O&AL
-/4,
-/4, 6201,32,7 61,,E337 6203,0207 1 63,1,E337 1 1 6H20,2HE7 6E1,3,,7 >4.2,2.53,@
-/4, 61H,2207 61,0117 621,12L7 1 61,1037 61,L,HHE7 1 1 61,EEH7 >-14.522@
Consoli*ate* O&=E+ +EEE8:ES L >EKPE8SES@ @ther operating revenues 617 @ther operating expenses &O&AL
617
-/4,
-/4+estate* E1,,210 632,3107 ,5,.2//
12E,2L2 6E3,3307 34.,60
Including 8ew 0eplacement Talue 6T807, see 8ote 2.
121
.1) #.#<T0I< (@:#0 ( 0<+"!#' -@0 0#!".#

Consoli*ate* (?h -/4, <onnection charges !pot mar*et energy 8etwor* usage charges T# 8orte -luminense Itaipu 1 binational #nergy transportation 1 Itaipu 8ational #lectric !ystem @perator 6@.8.!.7 (0@I8-" #!! @ther contracts and electric power auctions (I!M<@-I8! credits on purchase <'# transfer 6b7 0eserve (ower &O&AL
6a7
>a@
+F -/4-/4, 1 HL, 1 3,33H ,,3,L 1 1 ,E3 1 13,,H1 1 1 1 -0.1-1 612,0337 612L,HEE7 612L,H207 61,0HH,2H37 63,E,L127 61L,2EL7 612,,237 612E,31L7 61E2,EEE7 62,021,,3E7 3E2,322 303,E13 61L,L,H7 >,.363.-1,@ -/4+estate* 622,2337 61L1,3227 6EL0,,2E7 623L,0E37 6,33,3237 6EL,2217 621,0,L7 611E,2L07 612H,H337 61,2,,,1L37 3LL,2EL 1 6E2,21E7 >6.465.44-@
1 1,23L 1 3,3,1 ,,310 1 1 ,23 1 1,,2H2 1 1 1 -0.64/
8ot revised by independent auditors 0efers to <'# transfer relating to electric energy purchase costs up to 'ecember 2013 granted in the 2013 tariff review process. -or further details, see 8ote 10.
6b7
.2) -I8"8<I". 0#! .T

Consoli*ate* -/4, -/4+estate*
+EEE8:ES Interest on electricity bills and debts paid by installments Income from investments !wap operations 0estatement of 4udicial deposits "d4ustment to 8ew 0eplacement Talue 6T807 @ther financial income 6a7 &O&AL ;I8A8CIAL +EEE8:E EKPE8SES 0estatement of provision for contingencies #xpenses with tax liabilities 'ebt charges -oreign exchange variation !wap operations (repayment of receivables "d4ustment to present value of accounts receivable -ines due to electric power discontinuance @ther financial expenses
6a7
LH,3E, 2,,113 H0,2,0 1,,,01 EE,0HL 2E,132 ,,3.453
L3,2,1 E1,00E 1H,233 22,231 1 2,,3,3 40-.5/3
61,0207 61E,E207 6,12,3L27 613H,3227 1 1 62,2037 6EH,,,,7 6,2,3137 >104.063@ >65,.10/@
630,,317 613,32L7 6E3L,2H27 620,2H27 6E,,2L7 630,2137 6E0,22H7 63H,03L7 63E,3E,7 >23,.2/-@ >604./06@
&O&AL ;I8A8CIAL EKPE8SES ;I8A8CIAL +ES:L&

6a7
It refers to sundry revenues and expenses.
122
..) 0#<@8<I.I"TI@8 @- T"V#! I8 I8<@9# !T"T#9#8T
0econciliation of effective and nominal rates in the provision for income tax and social contributionA
Parent Compan# -/4, #arnings before income tax and social contribution 8ominal income tax and social contribution rate I8COME &AK A8$ SOCIAL CO8&+I):&IO8 A& &=E +A&ES ES&A)LIS=E$ )D &=E C:++E8& LE(ISLA&IO8 #?uity income Interest on e?uity nrecogni%ed deferred tax credits <T9 n] 3L1M02 1 .ight !.". Tax incentives @ther effects from income tax and social contribution on permanent additions and exclusions I8COME &AK A8$ SOCIAL CO8&+I):&IO8 I8 &=E I8COME <urrent income tax and social contribution 'eferred income tax and social contribution #ffective income tax and social contribution rate ,HL,33, 3E) >400.206@ 20L,0E3 63,LH27 63,13H7 1 6E227 1 1 0.0) -/4E23,223 3E) >466.4,6@ 1,0,0,1 63,L1H7 62,H127 1 313 1 1 0.0) -/4, H,2,103 3E) >-30.145@ 61,H,,7 33,,E1 63,13H7 3,02E 62,32,7 >-26.123@ 6113,20E7 61,0,H3E7 31.1) Consoli*ate* -/4+estate* ,2H,3H, 3E) >-/,.654@ L,32H 22,E3H 62,H127 3,E32 6H,E3E7 >416.62-@ 611,,00H7 6,2,E,E7 22.2)
.4) -I8"8<I". I8!T0 9#8T! "8' 0I!` 9"8"&#9#8T

The statement below reconciles the carrying and fair value of assets and liabilities related to our financial instrumentsA
123
Parent Compan# 4-.,4.-/4, ASSE&S <ash and cash e?uivalents 68ote E7 !ervices 'ividends and interest on e?uity receivable @ther receivables &O&AL LIA)ILI&IES !uppliers 'ividends and interest on e?uity payable 68ote 2,7 @ther payables &O&AL 22, 32,012 3,230 ,2.-16 22, 32,012 3,230 ,2.-16 E,H LE,L22 E,E1, 10.225 E,H LE,L22 E,E1, 10.225 )oo' 9alue 23,H02 1E3 33,1,3 3,1E3 20.-66 ;air 9alue 23,H02 1E3 33,1,3 3,1E3 20.-66 4-.,4.-/4)oo' 9alue E,,E32 1EH 12,210 3,33, 14.60;air 9alue E,,E32 1EH 12,210 3,33, 14.60-
Consoli*ate* 4-.,4.-/4, ASSE&S <ash and cash e?uivalents 68ote E7 9ar*etable securities 68ote ,7 <oncessionaires and permissionaires 68ote 37 !ervices !waps <oncessionsQs financial assets 68ote 27 @ther receivables 68ote 107 &O&AL LIA)ILI&IES !uppliers 68ote 1E7 .oans and financing 68ote 137 'ebentures 68ote 1L7 'ividends and interest on e?uity payable 68ote 2,7 !waps @ther payables 68ote 227 &O&AL 20L,232 2,E1E,23L 3,E00,3EE 32,012 1 2,2,2,L 1./46.560 20L,232 2,E13,021 3,3L3,23, 32,012 1 2,2,2,L 2.033.526 H1E,E32 2,233,E31 1,2LE,0,E LE,L22 3,122 22L,21H 5.6,/./0, H1E,E32 2,320,0H3 2,0L3,100 LE,L22 3,122 22L,21H 5.335.106 )oo' 9alue ,E3,E22 1,2EE,000 1,E32,H2L 22,H11 1E1,21E 1,223,223 21L,0H2 5.5,1.530 ;air 9alue ,E3,E22 1,2EE,000 1,E32,H2L 22,H11 1E1,21E 1,223,223 21L,0H2 5.5,1.530 4-.,4.-/4- - +estate* )oo' 9alue 230,3,3 1,,233 1,L31,01L E2,1L1 3,,,E0 1,,L3,3E2 132,,0E ,.101.-/, ;air 9alue 230,3,3 1,,233 1,L31,01L E2,1L1 3,,,E0 1,,L3,3E2 132,,0E ,.101.-/,
In compliance with <T9 0ule 8o. EL,M200H and <T9 0esolution 8o. 30EM2002, which revo*ed 0esolution 8o. ,33M200H, the description of accounting balances and fair values of financial instruments stated in the balance sheet as of 'ecember 31st, 2013 are identified as followsA
<ash and cash e?uivalents -inancial investments in ban* deposit certificates are classified as =loans and receivables>.
9ar*etable securities -inancial investments in ban* deposit certificates are classified as =held for trading>, measured at their fair value through profit and loss.
124
<onsumers, concessionaries and permissionaires 6clients7 These are classified as =loans and receivables>, measured at the amorti%ed cost, being recorded at their original values and sub4ect to a provision for losses and ad4ustment to present value, when applicable.
<oncessions5 financial assets These are classified as =available for sale>, measured at their fair value at initial recognition. "fter initial recognition, interest is calculated through the effective interest rate method and recogni%ed in the income statement under financial income, while the changes in the fair value are recogni%ed in other comprehensive income.
!uppliers "ccounts payable to suppliers of materials and services re?uired in the operations of the <ompany, the amounts of which are *nown or easily determinable, added, where applicable, of relevant charges, escalation andMor exchange costs incurred as of the balance sheet date. These balances are classified as other financial liabilities and were recogni%ed at their amorti%ed cost, which is not significantly different from their fair value.
.oans, borrowings and debentures These are measured by the =amorti%ed cost method>. -air value was calculated at interest rates applicable to instruments with similar nature, maturities and ris*s, or based on mar*et ?uotations of these securities. The fair value for $8'#! financing is identical to the accounting balance, since there are no similar instruments, with comparable maturities and interest rates. These financial instruments are classified as =other financial liabilities>.
@ther assets and liabilities @ther receivables and other payables classified as Xloans and receivablesX are measured at amorti%ed cost and stated at their original values, accrued of, where applicable, corresponding charges, monetary andMor currency variations incurred up to the balance sheet date or sub4ect to a provision for losses, when applicable.
!waps These are measured at fair value. " determination of fair value used available information on the mar*et and usual pricing methodologyA the face value 6notional7 evaluation for long position 6in .!. dollars7 until maturity date and discounted at present value of clean coupon rates, published in bulletins of !ecurities, <ommodities and -utures #xchange B $9R-$@T#!(".
It is worth mentioning that estimated fair value of financial assets and liabilities was determined by means of information available on the mar*et and appropriate valuation methodologies. 8evertheless, meaningful 4udgment was re?uired when interpreting mar*et data to produce the most appropriate fair value estimate.
125
a7 -inancial Instruments by category on 'ecember 31st, 2013A

Parent Compan# 4-.,4.-/4, Loans an* recei9a%les 23,H02 1E3 33,1,3 3,1E3 20.-66 ;air 9alue through profit or loss 1 1 1 1 Loans an* recei9a%les E,,E32 1EH 12,210 3,33, 14.604-.,4.-/4;air 9alue through profit or loss 1 1 1 1 -
&otal
&otal
ASSE&S <ash and cash e?uivalents 68ote E7 !ervices 'ividends receivable @ther receivables &O&AL
23,H02 1E3 33,1,3 3,1E3 20.-66
E,,E32 1EH 12,210 3,33, 14.60-
Parent Compan# 4-.,4.-/4, Amorti e* cost LIA)ILI&IES !uppliers 'ividends and interest on e?uity payable 68ote 2,7 @ther payables &O&AL 22, 32,012 3,230 ,2.-16 ;air 9alue through profit or loss 1 1 1 &otal Amorti e* cost 4-.,4.-/4;air 9alue through profit or loss 1 1 1 &otal
22, 32,012 3,230 ,2.-16
E,H LE,L22 E,E1, 10.225
E,H LE,L22 E,E1, 10.225
Consoli*ate* 4-.,4.-/4, Loans an* recei9a%les ,E3,E22 1 1,E32,H2L 30,231 1 1 21L,0H2 -.--2.520 ;air 9alue through profit or loss 1 1,2EE,000 1 1 1E1,21E 1 1 4.,35.-46 A9aila%le for sale 1 1 1 1 1 1,223,223 1 4.0-2.--2 Loans an* recei9a%les 230,3,3 1 1,L31,01L E2,1L1 1 1 132,,0E -.41,./63 4-.,4.-/4- - +estate* ;air 9alue through profit or loss 1 1,,233 1 1 3,,,E0 1 1 5/.3/2 A9aila%le for sale 1 1 1 1 1 1,,L3,3E2 1 4.51,.,60
&otal
&otal
ASSE&S <ash and cash e?uivalents 68ote E7 9ar*etable securities 68ote ,7 <oncessionaires and permissionaires 68ote 37 !ervices !waps <oncessionsQ financial assets 68ote 27 @ther receivables 68ote 107 &O&AL
,E3,E22 1,2EE,000 1,E32,H2L 30,231 1E1,21E 1,223,223 21L,0H2 5.5,3.//0
230,3,3 1,,233 1,L31,01L E2,1L1 3,,,E0 1,,L3,3E2 132,,0E ,.101.-/,
Consoli*ate* 4-.,4.-/4, Amorti e* cost LIA)ILI&IES !uppliers 68ote 1E7 .oans and financing 68ote 137 'ebentures 68ote 1L7 'ividends and interest on e?uity payable 68ote 2,7 !waps @ther payables 68ote 227 &O&AL 20L,232 2,E1E,23L 3,E00,3EE 32,012 1 2,2,2,L 1./46.560 ;air 9alue through profit or loss 1 1 1 1 1 1 &otal 4-.,4.-/4- -+estate* Amorti e* cost ;air 9alue through profit or loss 11, 1 1 1 3,122 1 2.-66 &otal
20L,232 2,E1E,23L 3,E00,3EE 32,012 1 2,2,2,L 1./46.560
H1E,3,E 2,233,E31 1,2LE,0,E LE,L22 1 22L,21H 5.6-,.360
H1E,E32 2,233,E31 1,2LE,0,E LE,L22 3,122 22L,21H 5.6,/./0,
126
b7 (olicy concerning derivative instruments The <ompany has a policy of using derivative instruments which has been approved by its $oard of 'irectors. "ccording to this policy, the debt service 6principal plus interest and charges7 denominated in foreign currency maturing within 2E months is to be hedged, except no speculative transaction is allowed, whether using derivatives or any other ris*y assets. In line with the policy standards, the <ompany does not have any options, swaps, callable swaps, flexible options, derivatives embedded in other products, derivative1structured transactions and so1 called =exotic derivatives>. -urthermore, the statement above denotes that the <ompany use cashless exchange rate swaps 6 !G vs. <'I7, of which the 8otional <ontract Talue is e?ual to the amount of the debt service denominated in foreign currency maturing in 2E months. c7 0is* management and goals achieved 9anagement of derivative instruments is achieved through operating strategies with a view to li?uidity, profitability and safety. @ur control policy consists of ongoing enforcement of policy standards concerning the use of derivative instruments, as well as continued monitoring of agreed upon rates versus mar*et rates. d7 9ar*et 0is* 'uring the normal course of its businesses, the <ompany and its subsidiaries are exposed to the mar*et ris*s related to currency variations and interest rates, as evidenced in the chart belowA 'ebt brea*down 6excluding financial charges7A
Consoli*ate* 4-.,4.-/4, +F !' # 0 &O&AL - ;O+EI(8 C:++E8CD <'I I(<" T/.( $8'#! 1 -I8#9 @ther &O&AL - LOCAL C:++E8CD &O&AL L2,,2E1 113,L01 3,0.263,232,13H 310,13L 203,02L 32,,21 L2,23L 6.0/4.32/ 5.164.5/A 12.3 2.0 46.2 ,L.0 10.3 1,.L 0.L 1.E 35.6 4//./ 4-.,4.-/4- - +estate* +F ,02,2,3 2,,01L 2/6.-1/ 2,322,2,3 1 1,02L,3H1 20,331 1 ,.531.-25 6.404.5,5 A 12.1 2.3 46.6 ,L.2 1 23.2 2.2 1 35.2 4//./
@n 'ecember 31st, 2013, according to the chart above, the foreign currency1denominated debt is 0GH32,3E2, or 1E.3) of total debt 60G30E,2L0, corresponding to 1E.E) on 'ecember 31st, 20127. -inancial derivative instruments were contracted for the amount of foreign currency1denominated debt service to expire within 2E months, in the swap modality, whose notional value on 'ecember 31st, 2013 stood at !G223,213 6 !G2E0,203 on 'ecember 31st, 20127 and e3E,232 6e3E,232 on
127
'ecember 31st, 20127, according to the policy for utili%ation of derivative instruments approved by the $oard of 'irectors. Thus, including the swaps, the foreign exchange exposure represents 1.E0) of total debt 60.E1) on 'ecember 31st, 20127. $elow, we provide a few considerations and analyses on ris* factors impacting on business of .ight &roup5s companiesA
<urrency ris*
<onsidering that a portion of loans and financing is denominated in foreign currency, the <ompany uses derivative financial instruments 6swap operations7 to hedge against service associated with these debts 6principal plus interest and commissions7 to expire within 2E months in addition to the swap of interest rates, as previously mentioned. -unds raised as per $"<#8 0esolution E131 from 9errill .ynch, $8(, <itiban* and $an* To*yo19itsubishi were already contracted with swap for the entire duration of the debt, duly previously approved by the $oard of 'irectors. 'erivative operations, comprising currency swaps and interest, the latter reported below, resulted in a gain of 0GH0,2,0 in 2013 60G1E,E32 gain in 20127. The net amount of swap operations as of 'ecember 31st, 2013, considering the fair value, is positive at 0G1E1,21E 6positive at 0G22,E11 on 'ecember 31st, 20127, as shown belowA
Starting $ate Maturit# $ate 8otional Ealue Contracte* >:SFLE:+O@ 30,000 2,L1, 1,33H 1,E31 1,E32 33,333 33,333 33,333 23,333 23,333 23,333 ,0,000 3E,232 ,,4.33;air Ealue $ec -/4, >+F@ Assets ;air Ealue $ec -/4, >+F@ Lia%ilities 1 1 1 1 1 1 1 1 1 1 1 1 1 ;air Ealue $ec -/4, >+F@ )alance
Institution
Currenc#
LightJs +ecei9a%le
LightJs Pa#a%le
$an* To*yo 1 9itsubishi Ita^ +!$< +!$< +!$< <itiban* <itiban* <itiban* <itiban* <itiban* <itiban* $an* of "merica $8(
!G !G !G !G !G !G !G !G !G !G !G !G # 0@
!GW2.33) !GW2.E2) !GW1.3L) !G !G !GW.iborW1.33) !GW.iborW1.33) !GW.iborW1.33) !GW.iborW1.,2HH) !GW.iborW1.,2HH) !GW.iborW1.,2HH) .iborW2.,22E) #uroWE.3H23)
100) <'I W 0.20) 100) <'I 100) <'I H3.22) <'I H2.3,) <'I 100) <'I W 1,00) 100) <'I W 1,00) 100) <'I W 1,00) 100) <'I W 1,10) 100) <'I W 1,10) 100) <'I W 1,10) 100)<'I W 0,3,) 100)<'IW1.30)
03.11.2013 0E.11.2012 10.02.2012 02.20.2013 02.20.2013 0H.23.2012 0H.23.2012 0H.23.2012 10.02.2012 10.02.2012 10.02.2012 11.10.2011 10.21.2011
03.11.2013 0E.11.201E 10.10.201E 0E.10.201, 10.02.201, 02.23.201L 0H.23.201L 02.23.201H 0E.03.201L 10.02.201L 0E.03.201H 11.10.2013 10.21.201E &O&AL
22,21L 2LH 21E 120 10, 10,332 10,,0E 10,L0H L,1E, L,230 L,E0H 31,202 22,2,H 4,3.325
22,21L 2LH 21E 120 10, 10,332 10,,0E 10,L0H L,1E, L,230 L,E0H 31,202 22,2,H 4,3.325
Institution
Currenc#
LightJs +ecei9a%le
LightJs Pa#a%le
Starting $ate
Maturit# $ate
8otional Ealue Contracte* >:SFLE:+O@ 31 2,L1, 2,2L0 1,33H 3,03, ,H 33,333 33,333 33,333 23,333 23,333 23,333 ,0,000 3E,232 -15.41,
;air Ealue $ec -/4>+F@ Assets 11 EL0 3,E 1 1,00, 13 1 1 1 1 1 1 13,,,E 13,22, ,4.2,5
;air Ealue $ec -/4>+F@ Lia%ilities 1 1 1 6E7 1 1 6E217 6,L27 6,2H7 61,E107 61,,327 61,,EH7 1 1 >2.4-0@
;air Ealue $ec -/4>+F@ )alance 11 EL0 3,E 6E7 1,00, 13 6E217 6,L27 6,2H7 61,E107 61,,327 61,,EH7 13,,,E 13,22, -5.5/2
$radesco Ita^ Ita^ +!$< +!$< +!$< <itiban* <itiban* <itiban* <itiban* <itiban* <itiban* $an* of "merica $8(
!G !G !G !G !G !G !G !G !G !G !G !G !G # 0@
!GW2.L2) !GW2.E2) !GW3.0L) !GW1.3L) !GW3.,H) !GW2.2,) !GW.iborW1.33) !GW.iborW1.33) !GW.iborW1.33) !GW.iborW1.,2HH) !GW.iborW1.,2HH) !GW.iborW1.,2HH) .iborW2.,22E) #uroWE.3H23)
100) <'I 100) <'I 100) <'I 100) <'I 100) <'I 100) <'I 100) <'I W 1.00) 100) <'I W 1.00) 100) <'I W 1.00) 100) <'I W 1.10) 100) <'I W 1.10) 100) <'I W 1.10) 100)<'I W 0.3,) 100)<'IW1.30)
03.10.2011 0E.11.2012 12.2H.2011 10.02.2012 0E.12.2011 02.12.2011 0H.23.2012 0H.23.2012 0H.23.2012 10.02.2012 10.02.2012 10.02.2012 11.10.2011 10.21.2011
03.12.2013 0E.11.201E 10.10.2013 10.10.201E 0E.10.2013 02.12.2013 02.23.201L 0H.23.201L 02.23.201H 0E.03.201L 10.02.201L 0E.03.201H 11.10.2013 10.21.201E &O&AL
128
The amount recorded was measured by its fair value on 'ecember 31st, 2013. "ll operations with derivative financial instruments are registered in clearing houses for the custody and financial settlement of securities and there is no margin deposited in guarantee. @perations have no initial cost. $elow, the sensitivity analysis for foreign exchange rates fluctuations, showing eventual impacts on financial result of the <ompany and its subsidiaries. The methodology used in the =(robable !cenario> considered the best estimate for the foreign exchange rate on 'ecember 31st, 201E. It is worth highlighting that, as this refers to a sensitivity analysis of the impact on the financial result of the next 12 months, debt balances on 'ecember 31st, 2013 were considered. It is worth mentioning that the behavior of debt and derivatives balances will observe their respective contracts, and the balance of temporary cash investments will fluctuate according to the need or available funds of the <ompany and its subsidiaries.
129
#xchange 0ate !ensitivity "nalysis, with the presentation of effects on the income statement before taxes, based on rates and pro4ections of the following sourcesA Top , $acen, Ita^, +!$<, $radesco and $loomberg.
+F OPE+A&IO8 +is' $e%t >:S$ an* E:+@ Scenario >I@C Pro%a%le Scenario >II@ S Scenario >III@ S -5A 5/A
;I8A8CIAL LIA)ILI&IES 8ational Treasury !urety 9erril .ynch $8( 6# 0@7 $an* To*yo 1 9itsubishi <itiban* $E+IEA&IEES !waps &O&AL 0eference for -inancial "ssets and .iabilities 0GM !G exchange rate 6end of the year7 0GM# 0@ exchange rate 6end of the year7 !' !' !' # 0@ !' !' 8acional !'M #uro 222,HH3 632,3HE7 E2,0H2 6,0,0007 63E,H,E7 630,0007 61H0,0007
>-4.143@ 63,HHL7 2,LE3 62,HL07 62,LH,7 63,EEE7 611,ELH7 1-.--2 L2,223 5/.5/3
>-63.11-@ 6EE,,2,7 31,E,2 632,HL07 631,20L7 632,EEE7 6131,ELH7 -3-.532H2,,H2 ,,.34/ W2,)
>615.3-1@ 6H,,13E7 30,1,H 632,HL07 631,0227 6L,,EEE7 62,1,ELH7 5/5.2/,0,,302 -0.115 W,0) 3.3000 E.H200
2.E000 3.2300
3.0000 E.0L,0
:ith the chart above, it is possible to identify that the partial hedge against foreign currency1 denominated debt 6only limited to debt service to expire within 2E months7, as when 0GM !G ?uote increases, liabilities financial expense also increases but financial revenues of derivatives also partially offset this negative impact and vice versa.
Interest rate ris*

This ris* derives from impact of interest rates fluctuation not only over financial expense associated with loans, financing and debentures of the <ompany, but also over financial revenues deriving from temporary cash investments. The policy for utili%ation of derivatives approved by the $oard of 'irectors does not comprise the contracting of instruments against such ris*. 8evertheless, the <ompany continuously monitors interest rates so that to evaluate eventual need of contracting derivatives to hedge against interest rates volatility ris*. In these cases, prior approval of the $oard of 'irectors is re?uested. "s of 'ecember 31st, 2013 the interest rate swap operation associated with the maturity of $radesco <<$ with notional value of 0G1,0,000 60G1,0,000 on 'ecember 31st, 20127, duly authori%ed by the 9anagement, stated a total of 0G2,3E2 60G3,20, on 'ecember 31st, 20127, considering the fair value, according to the following tableA
Institution
LightJs +ecei9a%le
LightJs Pa#a%le
Starting $ate
Maturit# $ate
8otional Ealue Contracte* >+F@ 1,0,000 45/.///
;air Ealue $ec -/4, >+F@ Assets 2,3E2 -.,60
;air Ealue $ec -/4, >+F@ Lia%ilities 1 -
;air Ealue $ec -/4, >+F@ )alance 2,3E2 -.,60
+!$<
<'IW0.H,)
101.2)<'IW6T/.(13)7
10.1H.2011
10.1H.201L &O&AL
130
Institution
LightJs +ecei9a%les
LightJs Pa#a%le
Starting $ate 10.1H.2011
Maturit# $ate 10.1H.201L &O&AL
8otional Ealue Contracte* >+F@ 1,0,000 45/.///
;air Ealue $ec -/4>+F@ Assets 3,20, ,.0/5
;air Ealue $ec -/4>+F@ Lia%ilities 1 -
;air Ealue $ec -/4>+F@ )alance 3,20, ,.0/5
+!$<
<'IW0,H,)
101,2)<'IW6T/.(13)7
$elow, the sensitivity analysis for interest rates fluctuations, showing possible impacts on the result before taxes. The methodology used in the =(robable !cenario> considered the best estimate for the interest rate on 'ecember 31st, 201E. It is worth highlighting that, as this refers to a sensitivity analysis of the impact on the financial result of the next twelve months, was considered debt and investment balances as of 'ecember 31st, 2013. It is worth mentioning that the behavior of debt and derivatives balances will observe their respective contracts, and the balance of investments will fluctuate according to the need or available funds of the <ompany.
131
$elow is the interest rate sensitivity analysis, showing the effects on income statement before taxes, based on rates and pro4ections of the following sourcesA Top , $acen, Ita^, +!$<, $radesco and $loomberg.
+F OPE+A&IO8 ;I8A8CIAL ASSE&S -inancial investments ;I8A8CIAL LIA)ILI&IES 'ebentures Eth issue 'ebentures Lth issue 'ebentures Hth issue 'ebentures 2th issue 6!eries "7 'ebentures 2th issue 6!eries $7 'ebentures 1st issue 'ebentures 2nd issue 'ebentures 3rd issue <<$ $radesco <<$ $co !antander $8'#! -inem direto $8'#! 'ireto T/.( $8'#! 'ireto T/.(W1) !#!" $8'#! <apex 11M12 1 !ubcred.1 !#!" $8'#! <apex 11M12 1 !ubcred.2 !#!" $8'#! <apex 11M12 1 !ubcred.3 !#!" $8'#! <apex 11M12 1 !ubcred.E !#!" $8'#! <apex 11M12 1 !ubcred.1L !#!" $8'#! <apex 11M12 1 !ubcred.1H $8'#! 1 -I8#9 $8'#! 1 -I8#9 direto $8'#! 1 -I8#9 W1 $8'#! 1 <apex 11M12 ((0@#!<@ $anco do $rasil 0G 1,0 99 $E+IEA&IEES <urrency swaps Interest rate swaps Interest rate swaps &O&AL 0eference for -I8"8<I". "!!#T! <'I 6) end of the year7 0eference for -I8"8<I". .I"$I.ITI#! <'I 6) end of the year7 T/.( 6) end of the year7 I(<" 6) end of the year7 <'I <'I T/.( T/.( <'I <'I <'I I(<" <'I <'I <'I <'I <'I T/.( T/.( T/.( T/.( T/.( T/.( T/.( T/.( T/.( T/.( T/.( T/.( T/.( T/.( <'I <'I +is' Scenario >I@C Pro%a%le 41-.1/6 1L2,L0E >623.,31@ 617 6L0,2107 6,0,E237 6103,L227 632,23L7 613,E017 6E3,3207 63,2107 622,23E7 63,,H27 62,1LE7 63,0,07 63,HE37 610,7 611,21H7 613,13,7 61E,E327 617 617 2,2H, HLL HLL 61,3027 61,,2,7 61E,3,37 >--.425@ 62E,3227 1,11L 1,11L >,41.363@ 2.LL) 2.LL) ,.00) ,.21) Scenario >II@ S -5A -45.023 21,,23H >550./01@ 617 6H,,3EH7 631,1,17 6122,3117 6LH,,2H7 620,2HH7 6,3,30L7 63,HHL7 633,EHL7 6L,2EE7 62,E,H7 6L,01L7 6L,H117 61317 613,21E7 61,,30L7 613,30E7 617 617 2,322 221 22E 61,2137 61,H3H7 61L,L,E7 >,1.043@ 633,2237 1,0LH 62,L037 >,34./61@ W2,) 12.21) W2,) 12.21) 3.2,) L.32) Scenario >III@ S 5/A -50.-22 2,2,233 >263./24@ 617 6100,0HH7 6L1,,2E7 61,1,EE,7 6HL,1EH7 62E,0237 63,,L317 6E,,,17 6E2,HL27 62,2L27 62,LE07 6L,2L,7 6H,L327 61,L7 61,,1H27 61L,E,,7 61H,LEL7 617 617 3,02E 1,10, 1,03H 62,22L7 62,1327 621,0H37 >5-.134@ 6EL,22E7 1,03H 63,,2,7 >664.512@ W,0) 1E.33) W,0) 1E.33) L.,0) H.HL)
132
<redit ris*
It refers to the <ompany eventually suffering losses deriving from default of counterparties or financial institutions depositary of funds or temporary cash investments. To mitigate these ris*s, the <ompany uses all collection tools allowed by the regulatory body, such as disconnection for delin?uency, debit losses and permanent monitoring and negotiation of outstanding positions. <redit ris* of receivables is diluted due to the <ompanyds client base. Item XaX of this note contains a summary of the financial instruments bro*en down by category, including the <ompanyQs maximum credit ris*. <oncerning financial institutions, the <ompany only carries out low1ris* operations, classified by rating agencies. The <ompany has a policy of not concentrating its portfolio in certain financial institution. Therefore, the policy5s principle is to control the portfolio concentration through limits imposed to the &roups, as defined below, and monitoring financial institutions through their shareholders5 e?uity and ratings. Through its policy, the <ompany will be able to invest in fixed income products and Interban* 'eposit 0ate 6<'I71indexed post1fixed income and post1fixed government bonds. The definition of the groups for allocation of resources is described below, as well as the percentage of current share in the <ompany5s portfolioA
&roup 1 B federal ban*sD shareholders5 e?uityA not applicableD minimum ratingA 8ot applicableD percentage in the portfolioA EL.,).
&roup 2 B -inancial Institutions with !hareholders5 #?uity higher than or e?ual to 0GL billionD 9inimum 0atingA "" 6!R( and -itch7 or "aa 69oody5s7. (ercentage in the portfolioA E0.3).
&roup 3 B -inancial institutions with !hareholders5 #?uity between 0G1 billion and 0GL billionD 9inimum 0atingA "" 6!R( and -itch7 or "aa 69oodyQs7. (ercentage in the (ortfolioA 10.L). &roup E B -inancial Institutions with !hareholders5 #?uity between 0G,00 million and 0G1 billionD 9inimum 0atingA " 6!R( and -itch7 or "2 69oody5s7. (ercentage in the portfolioA 1.2). &roup , 1 @nly -inancial Institutions with restricted court deposits. (ercentage in the portfolioA 0.0).
133
.i?uidity ris*
.i?uidity ris* relates to the <ompanyQs ability to settle its liabilities. In order to determine the ability to satisfactorily meet its financial liabilities, the streams of maturities for funds raised and other liabilities are reported with the <ompanyQs statements. -urther information on the loans and debentures can be found in detail in 8otes 13 and 1L. The <ompany has raised funds through its operations, from financial mar*et transactions and from affiliate companies, primarily allocated to support its investment plan and in managing its cash for wor*ing capital and liability management purposes. The <ompany manages the li?uidity ris* by continuously monitoring expected and real cash flows and combining the maturity profiles of its financial liabilities. The reali%ation flow concerning future liabilities as per the relevant terms and conditions, which include future interest up to the maturity date, is summari%ed in the statement belowA
Consoli*ate* Interest rate instrumentsC -loating .oans, financing and debentures -ixed rate .oans, financing and debentures !uppliers !wap 6,,0327 20L,232 611,2217 61E3,0,E7 1 L3L 62EH,,,L7 1 H,,22E 632,EL27 1 1 6E33,11,7 20L,232 L,,,10 611H,,L27 6LHH,,227 6E,2H,,23H7 62,223,3237 6L,EH3,02H7 4 to , months , months to 4 #ear 4 to 5 #ears More than 5 #ears &otal
a7
<apital 9anagement The <ompany manages its capital with the purpose of safeguarding its capacity to continuously offer return to shareholders and benefits to other sta*eholders, in addition to maintaining the ideal capital structure to reduce costs.
134
In order to maintain or ad4ust its capital structure, the <ompany either reviews the dividend payment policy, returns capital to shareholders or issues new shares and sells assets to reduce the indebtedness level, for instance.
Parent Compan# 4-.,4.-/4, 'ebt from financing, loans and debentures 617 <ash and cash e?uivalents 8E& $E)& >A@ !hareholdersQ e?uity 6$7 ;I8A8CIAL LEEE+A(E +A&IO - A >AT >)SA@@ 1 23,H02 >-2.3/-@ 3,ELL,132 -4A 4-.,4.-/41 E,,E32 >65.620@ 3,02,,3H3 --A Consoli*ate* 4-.,4.-/4, ,,H1,,311 ,E3,E22 5.-23.333,ELL,132 2/A 4-.,4.-/4+estate* E,23L,EH, 230,3,3 6.//1.4-0 3,02,,3H3 51A
b7 +ierarchical -air Talue There are three types of classification levels for the fair value of financial instruments. This hierarchy prioriti%es unad4usted prices ?uoted in an active mar*et for financial assets or liabilities. The classification of hierarchical levels can be presented as followA
.evel 1 1 'ata originating from an active mar*et 6unad4usted ?uoted price7 that can be accessed on a daily basis, including on the date of fair value measurement. .evel 2 1 'ifferent data originating from the active mar*et 6unad4usted ?uoted price7 included in .evel 1, extracted from a pricing model based on data observable in the mar*et. .evel 3 1 'ata extracted from a pricing model based on data that are not observable in the mar*et.
Consoli*ate* Measurement of ;air Ealue 4-.,4.-/4, I*entical mar'ets Le9el 4 Similar mar'ets Le9el ?ithout acti9e mar'et Le9el ,
ASSE&S 9ar*etable securities 68ote ,7 <oncessionsQ financial assets 68ote 27 !waps &O&AL 1,2EE,000 1,223,223 1E1,21E ,.,44.66/ 1 1 1 1,2EE,000 1 1E1,21E 4.,35.-46 1 1,223,223 1 4.0-2.--2
135
Consoli*ate* Measurement of ;air Ealue 4-.,4.-/4+estate* ASSE&S 9ar*etable securities 68ote ,7 <oncessionsQ financial assets 68ote 27 !waps &O&AL LIA)ILI&IES !waps &O&AL 3,122 2.4-0 1 3,122 2.4-0 1 1,,233 1,,L3,3E2 3,,,E0 4.2-6.455 1 1 1 1,,233 1 3,,,E0 5/.3/2 1 1,,L3,3E2 1 4.51,.,60 I*entical mar'ets Le9el 4 Similar mar'ets Le9el ?ithout acti9e mar'et Le9el ,
The mar*et value of a security corresponds to its maturity amount brought to present value through the discount factor obtained based on the mar*et interest curve in reais. 0egarding the concession5s financial assets, classified as available for sale, the inclusion in level 3 was due to the fact that the relevant factors for the valuation at fair value were not publicly observable. The changes between the years and the respective gains and losses in the income statement for the year are described in 8ote 2, and there was no impact on shareholders5 e?uity this year.
./) I8! 0"8<#

@n 'ecember 31st, 2013, the .ight group had insurances covering its main assets, includingA @perational 0is* Insurance 1 it covers damages caused to hydroelectric and thermoelectric powerplants, including, but not limited to its machinery, steam turbines, gas turbines, generators, boilers, transformers, channels, tunnels, dams, spillway, civil wor*s, offices and warehouses. "ll assets are insured under the @perational 0is*s modality, with an =All !is>s> coverage, including the transmission and distribution lines up to 1,000 feet from generation site. 'irectors and @fficers .iability Insurance 6'R@7 1 It has the purpose of protecting #xecutives from losses and damages resulting from the performance of their activities inherent to the position as 'irectors, @fficers and 9anagers of the <ompany. &eneral and <ivil .iability Insurance 1 focuses on the payment of indemnity if the <ompany is deemed civilly liable by a final and unappealable court decision or deal authori%ed by the insurance company, in relation to remedies for property damage and involuntary personal in4ury caused to third parties and also those related to pollution, contamination, sudden andMor accidental lea*age. -inancial &uarantee Insurance B #nergy Trading and /udicial. (roperty Insurance B <omprehensive $usiness 6.eased (roperties7. International Transport Insurance B Imports, <orporate Travel Insurance and (ersonal Insurance. The assumptions of ris*s adopted, given their nature, are not included in the scope of an audit firm, accordingly, they were not audited by independent auditors.
136
$elow, a summari%ed brea*down of main insurance policies considered by 9anagementA

&erm +ISMS ;rom 'irectors R @fficers 6'R@7 <ivil and general liabilities @perating ris*s
617 617 617
Amount Insure* &o HM10M201E 10M31M201E 10M31M201E GE0,3,0 G20,000 0G ,,E23,H2E 10M0HM2013 31M10M2013 31M10M2013
(ross Premium >inclu*ing cost of insurance polic# S IO;@ G1,0 GHE, G2,,0E
9aximum limit of liability 6.907 is 0G300,000 1 Indemnity Total Talue in 0is* of 0G,,E23,H2E
.0) !#&9#8T 0#(@0TI8&

!egment reporting was prepared according to <(< 22 6@perating !egments7, e?uivalent to I-0! H, and is reported in relation to the business of the <ompany, identified based on their management structure and internal management information. The <ompanyQs 9anagement considers the following segmentsA power distribution, power generation, power trading and others 6including the holding company7. The eliminations comprise intersegment balances, transactions and interests. The <ompany is segmented according to its operation, which has different ris*s and compensation. The <ompany does not have any client that represents 10) or more of revenue or receivables.
137
!egment information for the years ended 'ecember 31st, 2013 and 2012 is presented belowA
$istri%ution "ssetsA <urrent assets @ther non1current assets Investments (roperty, plant and e?uipment Intangible assets &O&AL ASSE&S .iabilities and shareholdersQ e?uityA <urrent liabilities 8on1current liabilities !hareholdersQ e?uity &O&AL LIA)ILI&IES A8$ S=A+E=OL$E+SJ E7:I&D 3,0,H,22, ,,100,L20 2,E33,E31 4/.502.-62 3,1LL,32L 3,122,3H3 12,,HE 2E0,20, 3,2,2,3LL 4/.502.-62
(eneration
&ra*ing
Other
Eliminations
Consoli*ate* 4-.,4.-/4,
223,H1H 23,EL3 E33,H3H 1,3EL,132 1,3H, -.4-0.23,
203,L23 ,2,LHL E03 20,,3, H2, ,53.-10
L2,22H 30, 3,EE2,0L, H13 221 ,.5-0.26-
6231,E137 6,2,,307 63,220,L007 1 1 >,.244.26,@
3,E2,,L,3 3,223,E1H 3E2,203 1,3LH,L22 3,232,10H 4,.//-.-/1
2,,,E20 1,1E3,012 L31,1H1 -.4-0.23,
213,2EE 21,E3E 120,301 ,53.-10
E2,1E3 200 3,EL2,,23 ,.5-0.26-
6231,E137 6,2,,307 63,220,L007 >,.244.26,@
3,31H,E32 3,203,303 3,ELL,132 4,.//-.-/1
$istri%ution
(eneration
&ra*ing
Other
Eliminations
Consoli*ate* 4-.,4.-/4+estate*
"ssetsA <urrent assets @ther non1current assets Investments (roperty, plant and e?uipment Intangible assets &O&AL ASSE&S .iabilities and shareholdersQ e?uityA <urrent liabilities 8on1current liabilities !hareholdersQ e?uity &O&AL LIA)ILI&IES A8$ S=A+E=OL$E+SJ E7:I&D 1,L3L,2EE ,,0E1,,2L 2,1HH,H1E 3.023.,55 1,,,EE3 1,12,,200 303,3H3 4.056.1,,2,32E 2,223 11L,221 431.423 H1,303 1,0E3 3,02L,3HE ,.44/./,, 6H3,3327 6LL,3HL7 62,212,1227 >,./1-.364@ 1,2,0,3HH 3,1L1,0L3 3,02,,3H3 44.461.661 1,21,,EE2 3,020,E32 12,L,3 231,2,0 3,L11,E3H 3.023.,55 12L,,3L 1,,23 E1H,00L 1,3L0,H3H 33,L2L 4.056.1,122,H2E 2E,030 3L3 32,331 1LL 431.423 LL,30H 220 3,031,033 H03 223 ,.44/./,, 6H3,3327 6LL,3HL7 62,212,1227 1 1 >,./1-.364@ 2,13L,1H3 3,032,01H ,,L,3,0 1,33,,2,, 3,LEH,33H 44.461.661
138
Income segment reportingA

-/4, $istri%ution (eneration &ra*ing Other Eliminations Consoli*ate* -/4,
8E& +EEE8:E OPE+A&I8( COS&S A8$ EKPE8SES +esults of eGuit# metho* ;I8A8CIAL +ES:L& -inancial income -inancial expense EA+8I8(S )E;O+E &AKES !ocial contribution Income tax 8E& I8COME
2.142.12>5.346.,,2@ >,24.620@ 321,32L 63H3,0237 56/.051 6E0,HH27 6113,3HE7 ,32.,04
553.22/ >425.4/6@ >6.50-@ >33.354@ 1H,231 610L,H127 ,//.44, 62L,3LE7 6L3,1H37 400.552
2/4.25>515.643@ >4/5@ 2.,3/ H,3E3 61,2337 ,-.5/3 62,,,,7 63,L207 -,.42,
3.10/ >40.253@ 2/3.16>0.35/@ 1,3,3 611,2037 533./-6 61EL7 61,37 531.1-6
>62,.2/3@ 62,.2/1 >2/0.600@ 612,1227 12,122 >2/0.600@ 1 1 >2/0.600@
1.6--.-52 >2.44/.0/0@ >5.656@ >65,.10/@ 33H,1,H 6L21,2EH7 35-.4/, 6L0,2,H7 6123,H107 531.,,5
-/4-
$istri%ution
(eneration
&ra*ing
Other
Eliminations
Consoli*ate* -/4- +estate*
8E& +EEE8:E OPE+A&I8( COS&S A8$ EKPE8SES +esults of eGuit# metho* ;I8A8CIAL +ES:L& -inancial income -inancial expense EA+8I8(S )E;O+E &AKES !ocial contribution Income tax 8E& I8COME
2.246.6/>5.3/2.-33@ >6/2.452@ 12E,,03 6300,3327 6/4.053 630,3,H7 6H2,30,7 -33.005
64/./22 >426.036@ --.-6>11.6/1@ 2,H0E 6HL,2117 430.041 61E,,227 63H,3327 4,2.160
-0-.3,>-21.216@ -45 -41,E,H 61,2E37 -5.535 62,2127 6,,2H07 41.,32
,.340 >46.-5-@ 66/.6->5.0,,@ 3,22E 62,1,L7 6-6./52 6,17 6H17 6-,.0-6
>4,3.150@ 4,3.12, >664.,-5@ >4.34/@ 613,EHE7 1E,3LE >66,.4,4@ 1 1 >66,.4,4@
1.43-.,2/ >2.446.6,5@ -4.556 >604./06@ 122,,0H 63H3,3027 503.,35 6EL,1,L7 612L,30,7 6-,.0-,
.1) T"0I-- 0#TI!I@8

@n a public meeting of the $oard of #xecutive @fficers, held on 8ovember ,th, 2013, "8##. approved the final results of the Third (eriodic Tariff 0evision of the subsidiary .ight !erviNos de #letricidade !.". The main results of the tariff revision process areA tariff repositioning, which establishes tariffs compatible with the coverage of efficient operating costs and the remuneration of prudent investments, and -actor V, which establishes productivity goals for the subse?uent tariff period. In the tariff repositioning calculation, "8##. definesA 6i7 efficient operating costs, based on the update of the operating costs defined in the previous cycleD 6ii7 prudent investments, which compose the 0egulatory 0emuneration $aseD 6iii7 the level of regulatory losses to be transferred to consumersD and 6iv7 non1manageable costs.
139
<onsidering the new financial component 63.EH)7, exclusively applied to the next 12 months and the withdrawal of financial component present in .ight !#!"5s tariffs 62.22)7, captive consumers observed an average ad4ustment in their electricity bills of 3.3,), as of 8ovember Lth, 2013. "8##. established component (d of -actor V at 1.22) and component T of -actor V at 0). 0egarding non1technical losses, the percentage to be recogni%ed in tariff was E0.E1) on the low voltage mar*et, constant during the cycle. The value corresponding to the difference between this percentage and a reference value starting from 31.3L) in the beginning of the cycle until reaching 22.32) in 201H will be invested in the <ompany5s program to combat losses and recorded as !pecial @bligations, separate from the 0egulatory 0emuneration $ase. The results from the fight against loss program will be monitored by "8##. as a condition to maintain the percentage at the level of E0.E1). 0egarding the 0egulatory 0emuneration $ase, the table below presents the final amounts considered by "8##..
LightJs &ariff A*<ustment -/4, &ross remuneration base 8et remuneration base "verage depreciation rate
;inal Amounts 11,2LE,212 3,L11,30L 3.H1)
.2) .@8&1T#09 I8<#8TIT# (."8

Incentive (lan in =(hantom @ptions> The =(hantom @ptions> modality was offered to eligible executives appointed by the $oard of 'irectors and is directly lin*ed to .ightQs value creation, measured by the variation in .ightQs Talue nit 6.T 7. The calculation of .T is based on the weighing of the following factorsA
140
1. 9ar*et value of shares issued by .ight !."D 2. #conomic value 6a multiple of #$IT'"7D 3. "mount of dividends distributed. The difference between the .T provided in the (rogram for the grant year and the .T verified in the exercise year multiplied by the amount of shares exercised by the participant will amount to the total long1term bonus to be paid to each participant. 8o obligation was recorded for 'ecember 31st, 2013, as the calculations made by the <ompany referring to the .T on 'ecember 31st, 2013 was lower than .T on the grant year.
.3) .@8&1T#09 <@8T0"<T!

a7 #lectric power sale agreements @n 'ecember 31st, 2013, the <ompany had power sale commitments positioned in average 9:, as shown in the table belowA
&otal con9entional energ# contracte* >a9erage M?@ ,10.20 EL2.20 EL2.20 EL2.20 EL2.20 EL2.20 EE2.3E EE2.3E EE2.3E EE2.3E EE2.3E EE2.3E EE2.3E 1 1 &otal contracte* incenti9i e* energ# >a9erage M?@ 2.2, 2.2, 2.2, 1 1 1 1 1 1 1 1 1 1 1 1
Dear
201E 201, 2013 201L 201H 2012 2020 2021 2022 2023 202E 202, 2023 202L 202H
141
b7 #lectric power purchase agreements @n 'ecember 31st, 2013, the <ompany had power purchase commitments, as followsA
Dear A9erage Mw agreement 2,3,, 2,,32 2,L00 2,L12 2,L23 2,L22 2,L23 2,L1E 2,L12 2,L12 2,L12 313 1 A9erage Mw Energ# auctions H2L H0H H1E HL2 21H L2L L22 L2L L2L LL2 LL2 3H1 33E &otal a9erage Mw agreements 3,1H2 3,3LL 3,,1E 3,,21 3,3EE 3,,12 3,,2, 3,,11 3,,02 3,E21 3,E21 1,22L 33E
201E 201, 2013 201L 201H 2012 2020 2021 2022 2023 202E 202, 2023
40) 8@81<"!+ T0"8!"<TI@8!

In 2013 and 2012, the <ompany carried out the following non1cash investment and financing activities, which are not reflected in the statements of cash flowsA
Consoli*ate* -/4, <apitali%ed financial charges "c?uisition of property, plant and e?uipment against suppliers <onstruction revenue 2E,23H 32,0L1 H20,2HE -/4- +estate* 3E,2E3 32,3LL 332,322
41) !@<I". "8' #8TI0@89#8T". I!! #! 6 naudited7

&ood #nvironmental 9anagement practices are present in the activities of different areas of the <ompany. .ight5s #nvironmental 9anagement !ystem 6!&"7, based on international standard I!@ 1E001, was implemented in 2001 to create environmental ?uality standards in the activities of distribution and generation of electric power. In compliance with environmental management re?uirements, the system avoids fines, embargoes to pro4ects, accidents, legal proceedings and damage to the <ompany5s image. In 2013, 22 distribution sites were certified, including 13H *T lines and 13H *T and 2, *T substations. <urrently, 21) of .ight5s sites are certified. In addition to I!@ 1E001 certification, all .ight5s hydroelectric powerplants are certified according to @+!"! 1H001 and I!@ 2001 occupational health and safety standards and ?uality standards, respectively. In 2013, the Integrated 9anagement !ystem 6!&I7 completed ten years and has been ensuring excellence in maintenance and energy generation operation activities. "s the operation and maintenance processes in energy distribution grids and generation units involve the ris* of accidents involving wor*ers, .ight has been investing heavily in cultural alignment, focusing the valuation of life.
142
In addition to the cultural alignment, .ight ensures <orporate 'evelopment by promoting excellent education and human development initiatives. The programs and initiatives are based on <ulture, .eadership, #ducation and 'evelopment. In 2013, training averaged E,.3 hours. In 2013, we can highlight the consolidation of =(rograma Tidaf> 6.ife (rogram7, whose ob4ective is to strengthen a culture aimed at safe behavior and prevention. The (rogram included the participation of H2) of the wor*force 6own and outsourced7 and 22 partner companies in E,1 groups with over H0,000 hours of training and 10,E00 attendances. "s a result, .ight had excellent results related to accident fre?uency and severity, exceeding all the goals established for the year. "ccident fre?uency decreased from E.0H to 2.3E and the severity rate dropped from 1,11E to 2H. 8o fatal accidents were reported. :ith regard to the benefits offered by the <ompany to its employees, in addition to private pension plans, managed by $raslight, .ight5s social benefits include mainly food aid, <hristmas food aid, daycare aid, sic* pay, social and psychological assistance, periodical health exams and scholarships at <olIgio 1] de 9aio. 0egarding social initiatives, in 2013, .ight maintained and strengthened its partnership with the state government, serving areas where new (acifying (olice nits 6 ((s7 were installed. .ight5s relationship with the pacified communities of 0io de /aneiro contributes to a new type of relationship with clients, based on formali%ation and change of habits. The initiatives include networ* protection and telemetering, and the implementation of the #fficient <ommunity and .ight 0ecycles pro4ects, improving supply ?uality, avoiding energy theft, improving default and raising customers5 awareness on the rational use of natural resources.
42) ! $!#C #8T #T#8T!

a7 !ettlement of deficit with $raslight @n -ebruary 13th, 201E, the <ompany settled the (rivate Instruments of Termination of "greements for 0esolving Technical 'eficits and 0efinancing namorti%ed 0eserves with $raslight, for 0G1,22H,20,, including the ad4ustment by the <'I rate, as mentioned in 8ote 21. b7 Inclusion of <#9I& &T in the controlling bloc* of 0enova #nergia !.". @n -ebruary 1Eth, 201E, <#9I& &T made an advance for future capital increase 6"-"<7 of 0GL32,2E3 at <hipley !( (articipaNOes !.". 6<hipley7, subsidiary of 0enova #nergia, which was fully used to pay for the ac?uisition of a ,1) interest in $rasil (<+ !.". 6$rasil (<+7 6E2) interest held by (etrobras and 2) interest held by /obelpa7, thus sharing its control. @n -ebruary 20th, 201E, the $oard of 'irectors of 0enova #nergia approved a capital increase of up to 0G3,,E,,302, at the issue price of 0G1L.LLH2, corresponding to 0G,3.333L per nit.
143
"ccording to the Investment "greement entered into between 0enova #nergia, 00 (articipaNOes, .ight #nergia, <#9I& &T and <hipley on "ugust Hth, 2013, the preemptive rights to ta*e part in the capital increase of the shares integrating the controlling bloc* of 0enova #nergia, composed of the shareholders 00 (articipaNOes and .ight #nergia, were assigned to <#9I& &T, which agreed to subscribe the shares and pay the amount of 0G1,,,0,0L2 by 9arch 31st, 201E. @f this amount, 0GL32,2E3 will be paid1in through the assignment of the advance to future capital increase, carried out by <#9I& &T at <hipley, to 0enova #nergia. "lso pursuant to the Investment "greement, shares may be subscribed by <#9I& &T andMor an e?uity investment fund 6-I(7, or !pecial (urpose #ntity 6!(#7 controlled by that fund. "fter the capital increase, a new !hareholders5 "greement will be signed, whereby <#9I& &T, 00 (articipaNOes and .ight #nergia will be included in the controlling bloc* of 0enova #nergia !.". $rasil (<+ owns 13 small hydroelectric power plants, located in the states of 9inas &erais, 0io de /aneiro, #spJrito !anto and &oiYs, all at operational stage, with total installed capacity of 221 9: and assured energy of 12E average 9:, contracted up to 202H and 2022, through (roinfa. c7 <reation of the #nergia @lJmpica !(# @n /anuary 2Lth, 201E, a !hareholders5 "greement was signed by the <ompany and -urnas <entrais #lItricas !.". 6-urnas7 to manage the !pecial (urpose #ntity #nergia @lJmpica !.". 6#nergia @lJmpica !(#7, which is engaged in the implementation, construction, operation and maintenance of a substation to provide energy to the 0io de /aneiro @lympic (ar*. The #nergia @lJmpica !(#5s ownership structure comprises the <ompany, which holds a ,0.1) interest in the capital, and -urnas, which holds the remaining E2.2). d7 <ontracting of a financing line with <itiban* @n -ebruary 21st, 201E, the subsidiary .ight !#!" contracted a financing line in .!. dollars with <itiban*, by means of an operation as per $acen 0esolution E131, with Interban* 'eposit 0ate 6<'I7 swap, totaling 0G23,,L,0, to reinforce its wor*ing capital andMor refinance debt maturing over the coming months, with a term of four years, at the <'I rate W 1.1,) p.a., in line with the authori%ation granted by the $oard of 'irectors, on this date, to contract a financing line of up to 0G1,000,000.
e7 (ublication of 'ecree no. H,203M1E @n 9arch Lth, 201E, 'ecree no. H,203M1E was published, amending 'ecree L,H21M13, in order to include the offsetting of the involuntary exposure of distribution concessionaires in the short1term mar*et, extending the coverage of the transfer of <'# funds to /anuary 201E. The amount of <'# funds to be transferred to subsidiary .ight !#!", as per "8##. @rder ,1,M1E, corresponding to the purchase of energy in /anuary 201E, totals 0G1H1,210.
144
)OA+$ O; $I+EC&O+S SI&&I8( MEM)E+S !Irgio "lair $arroso +umberto #ustY?uio <Isar 9ota 0aul $elens /ungmann (into 9aria #stela ùbitschec* .opes '4alma $astos de 9orais /osI <arlos "leluia <osta 0utelly 9ar?ues da !ilva .ui% <arlos da !ilva <antJdio /unior &uilherme 8arciso de .acerda 'avid Kylbers%ta4n <arlos "lberto da <ru% AL&E+8A&E MEM)E+S .ui% -ernando 0olla <Isar Ta% de 9elo -ernandes -ernando +enri?ue !chuffner 8eto <armen .^cia <laussen ànter :ilson $orra4o <id /osI "ugusto &omes <ampos <arlos "ntonio 'ece%aro 9arcelo (edreira de @liveira /alisson .age 9aciel "lmir /osI dos !antos 9agno dos !antos -ilho
;ISCAL CO:8CIL SI&&I8( MEM)E+S "ristUteles .ui% 9ene%es Tasconcellos 'rummond -rancisco .ui% 9oreira (enna "lisson "ndrade &odinho 0ogIrio -ernando .ot #rnesto <osta (ierobon AL&E+8A&E MEM)E+S "ri $arcelos da !ilva "liomar !ilva .ima 0onald &astPo "ndrade 0eis -rancisco Ticente !antana !ilva Telles "ndre &ustavo !alcedo Teixeira 9endes
145
)OA+$ O; EKEC:&IEE O;;ICE+S (aulo 0oberto 0ibeiro (into <hief #xecutive @fficer /oPo $atista Kolini <arneiro <hief -inancial and Investor 0elations @fficer "ndreia 0ibeiro /un?ueira e !ou%a +uman 0esources @fficer (aulo <arvalho -ilho <orporate 9anagement @fficer #vandro .eite Tasconcelos #nergy and $usiness 'evelopment @fficer 6temporarily7 0icardo <esar <osta 0ocha 'istribution @fficer -ernando "ntSnio -agundes 0eis .egal @fficer .ui% @tYvio Ki%a 9ota Taladares <ommunication @fficer
146
CO8&+OLLE+S=IP S:PE+I8&E8$E8CE 0oberto <aixeta $arroso <ontrollership !uperintendent <(- 013.011.,,31H3 <0<19& 0LH0H3M@1H !u%anne .loyd &asparini "ccountant 1 "ccounting 9anager <(- 0H1.E2,.,1L1,3 <0<10/ 10L3,2M@10
147
Deloitte Touche Tohmatsu Av. Presidente Wilson, 231 22 25 e 26 andares Rio de Janeiro RJ 20030-905 Brasil Tel: + 55 (21) 3981-0500 Fax:+ 55 (21) 3981-0600 www.deloitte.com.br
(Convenience Translation into English from the Original Previously Issued in Portuguese) INDEPENDENT AUDITORS REPORT To the Shareholders, Directors and Officers of Light S.A. Rio de Janeiro - RJ We have audited the accompanying individual and consolidated financial statements of Light S.A. (Company), identified as Parent and Consolidated, respectively, which comprise the balance sheet as at December 31, 2013, and the income statement, statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information. Managements Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of the individual financial statements in accordance with accounting practices adopted in Brazil, and the consolidated financial statements in accordance with International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board - IASB, and in accordance with accounting practices adopted in Brazil, and for such internal control as Management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Brazilian and International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing selected procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatements of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Companys preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Companys internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by Management, as well as evaluating the overall presentation of the financial statements.
148
Deloitte refere-se sociedade limitada estabelecida no Reino Unido Deloitte Touche Tohmatsu Limited e sua rede de firmas-membro, cada qual constituindo uma pessoa jurdica independente e legalmente separada. Acesse www.deloitte.com/about para uma descrio detalhada da estrutura jurdica da Deloitte Touche Tohmatsu Limited e de suas firmas-membro.
2014 Deloitte Touche Tohmatsu. Todos os direitos reservados.
Deloitte Touche Tohmatsu
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion on the Individual Financial Statements In our opinion, the individual financial statements present fairly, in all material respects, the financial position of Light S.A. as at December 31, 2013, and its financial performance and its cash flows for the year then ended, in accordance with accounting practices adopted in Brazil. Opinion on the Consolidated Financial Statements In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of Light S.A. as at December 31, 2013, and its consolidated financial performance and its consolidated cash flows for the year then ended, in accordance with International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board - IASB and accounting practices adopted in Brazil. Emphases of Matter Difference between accounting practices adopted in Brazil and IFRS with respect to the measurement of investments in subsidiaries, associates and joint ventures As described in Note 3, the individual financial statements have been prepared in accordance with accounting practices adopted in Brazil. In the case of the Company, these accounting practices differ from the IFRS, applicable to separate financial statements, only with respect to the measurement of investments in subsidiaries, associates and joint ventures by the equity method of accounting, which, for purposes of IFRS, would be measured at cost or fair value. Our opinion is not qualified regarding this matter. Restatement of corresponding figures for the year ended December 31, 2012 As referred to in Note 3, item v, because of the changes in accounting policies, the corresponding figures in the individual and consolidated balance sheet as at December 31, 2012 and in the consolidated income statement, consolidated statement of changes in equity, consolidated statement of cash flows and consolidated statement of value added (supplemental information) for the year ended December 31, 2012, presented for purposes of comparison, were adjusted and are being restated as provided for in the CPC 23/IAS 8 - Accounting Policies, Changes in Accounting Estimates and Errors and in the CPC 26 (R1)/IAS 1 - Presentation of Financial Statements. Our opinion does not have any modification regarding this matter. Transfers of funds from the Energy Development Account (CDE) Without modifying our opinion on the individual and consolidated financial statements for the year ended December 31, 2013, we draw attention to the matter described in Note 10, regarding the recording by subsidiary Light Servios de Eletricidade S.A., in the form of reduced energy cost purchased for resale, of transfers of funds from the energy development account (CDE), already approved by the Brazilian Electricity Regulatory Agency (ANEEL), established by Decree 7,945/13.
2014 Deloitte Touche Tohmatsu. All rights reserved.
149
Deloitte Touche Tohmatsu
Other Matters Statements of value added We have also audited the individual and consolidated statements of value added (DVA) for the year ended December 31, 2013, prepared under the responsibility of the Companys management, which presentation is required by the Brazilian Corporate Law for publicly-traded companies and as supplemental information for IFRS, which does not require the presentation of a DVA. These statements were subject to the same auditing procedures described above and, in our opinion, are fairly presented, in all material respects, in relation to the financial statements taken as a whole. Audit of the balance sheet as at January 1, 2012 The audit of the individual and consolidated balance sheets as at January 1, 2012, which are restated due to the matters described in Note 3, item v, as provided for in the CPC 23 - Accounting Policies, Changes in Accounting Estimates and Errors and the CPC 26 (R1) - Presentation of Financial Statements, was conducted under the responsibility of other independent auditors, who issued an unqualified audit report dated May 10, 2013 containing an emphasis of matter paragraph, without any modification in its opinion, relating to the difference in the measurement of investments in subsidiaries, associates and joint ventures by the equity method of accounting, which, for purposes of IFRS would be measured at cost or fair value. The accompanying financial statements have been translated into English for the convenience of readers outside Brazil. Rio de Janeiro, March 10, 2014
DELOITTE TOUCHE TOHMATSU Auditores Independentes
Maurcio Pires de Andrade Resende Engagement Partner
2014 Deloitte Touche Tohmatsu. All rights reserved.
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MANAGEMENT REPORT LIGHT S.A.

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

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MANAGEMENT REPORT LIGHT S.A. 2013

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MANAGEMENT REPORT LIGHT S.A. 2013

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MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

@wnership structure on 'ecember 31, 2013

MANAGEMENT REPORT LIGHT S.A. 2013

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MANAGEMENT REPORT LIGHT S.A. 2013

$i9i*en* per share 0G 0.E, 0G 0.,3 0G 0.2H 0G 1.L2 0G 1.L2

0EM22M2013 12M13M2013 02M2EM2012

0G 21,LL0,32L.00 0G 10L,EL3,2E2.32 0G 122,2E3,,L3.32 0G 33E,H3H,033.3E 0G 33E,H3H,033.3E

MANAGEMENT REPORT LIGHT S.A. 2013

Commitment to the ;uture

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

MANAGEMENT REPORT LIGHT S.A. 2013

Annual Social Balance Sheet / 2013

reais) 7,182,360 1,067,926 204,955 % on NR 0% 1% 0% 0% 0% 0% 0% 0% 0% 0% 0% 2% % on NR 0% 0% 0% 0% 0% 1% 1% 41% 42% % on NR 1% 0% 1%

( ) no go als ( ) co mplies 51to 75% ( ) co mplies 0 to 50% (X) co mplies 76 to 1 00%

( ) management and managers ( ) do es no t get invo lved ( ) management

(X) management and managers ( ) all emplo yees

( ) are no t co nsidered ( ) do es no t get

in Pro co n Reduce 1 0% in Pro co n 1 00%

Parent Compan# 4-.,4.-/4, 4-.,4.-/4+estate* /4./4.-/4+estate* 4-.,4.-/4,

Consoli*ate* 4-.,4.-/4+estate* /4./4.-/4+estate*

22, 11,0EH 2 1 1 1 32,012 1,,E3 1 3 3,0,2 61.020

E,H 1,3E0 2 1 1 1 LE,L22 322 1 11 3,,1E 3/.3/0 1 1 1 1 1 1 1E2 201 4./6,

12L H,211 2 1 1 1 L3,LE1 233 1 1 2,EHH 35.511 1 1 1 1 1 1 1 -

2,22,,H22 ,3,,31E 332,H12 E22,E2H 6L3,31E7 1 ,.611.4,0 ,.5-2.//0

2,22,,H22 2,3,,3, 21,LL0 E,1,,,3 61L1,22L7 1L1,22L ,./-5.23, ,.4/1.5,5

2,22,,H22 3E1,32, 1H1,,01 EL2,3,3 632,2LH7 62,,3H7 ,.414.3-3 ,.-51.6//

2,22,,H22 ,3,,31E 332,H12 E22,E2H 6L3,31E7 1 ,.611.4,0 4,.//-.-/1

2,22,,H22 2,3,,3, 21,LL0 E,1,,,3 61L1,22L7 1L1,22L ,./-5.23, 44.461.661

2,22,,H22 3E1,32, 1H1,,01 EL2,3,3 632,2LH7 62,,3H7 ,.414.3-3 4/.255.3--

,.414.3-3 1 61H1,,017 1 E23,223

'irect subsidiary of 0enova Indirect subsidiary of 0enova

<onsolidated !tatement of -inancial (osition as at 'ecember 31st, 2012.

$i9ien per share 0G 0.E, 0G 0.,3 0G 0.2H 0G 1.L2 0G 1.L2

Consoliate 4-.,4.-/4+estate* /4./4.-/4+estate*

Consoliate 4-.,4.-/4, 4-.,4.-/4+estate*

Su%siiaries an <ointl#-owne* su%si*iaries - Interest