NOTE 36 – PARENT COMPANY INFORMATION

Condensed separate statement of financial position

The following are the condensed separate (alone) statements of financial position of Grupo Aval Acciones y Valores S.A., at December 31, 2019, and 2018 and condensed separate statements of income and statement of cash flows for the fiscal year ended December 31, 2019, 2018 and 2017.

Condensed separate Statement of Financial Position


	December 31,
	2019		2018
Current Assets
Cash and cash equivalents	Ps.	51,299	Ps.	38,667
Held for trading securities		212		1,543
Accounts receivable from related parties		328,307		267,640
Other assets		442		517
Total current assets	Ps.	380,260	Ps.	308,367

Non current Assets
Investments in subsidiaries and associates		22,016,681		19,932,376
Property plant and equipment		8,351		2,414
Deferred tax		331		476
Total non current assets	Ps.	22,025,363	Ps.	19,935,266

Total assets	Ps.	22,405,623	Ps.	20,243,633

Current liabilities
Borrowings at amortized cost		189,297		2,808
Outstanding bonds at amortized cost		107,435		284,758
Accounts payable		468,298		405,372
Other non-financial liabilities		1,214		1,214
Total current liabilities	Ps.	766,244	Ps.	694,152

Long-term liabilities
Borrowings at amortized cost		241,141		541,924
Outstanding bonds		1,124,520		824,520
Total non current liabilities	Ps.	1,365,661	Ps.	1,366,444

Total liabilities	Ps.	2,131,905	Ps.	2,060,596

Equity
Shareholders’ equity		20,273,718		18,183,037

Total liabilities and shareholders’ equity	Ps.	22,405,623	Ps.	20,243,633


	December 31,		December 31,		December 31,
Condensed separate Statement of Income	2019		2018		2017
Operating revenue
Equity method income, net		3,014,756		2,893,435		2,005,155
Other revenue from ordinary activities		286,778		285,218		234,502
Total operating revenue	Ps.	3,301,534	Ps.	3,178,653	Ps.	2,239,657

Expenses, net
Administrative expenses		(83,902)		(75,348)		(89,823)
Other expenses		(236)		(166)		(274)
(Losses) gains from exchange differences		(812)		(1,601)		98
Operating income	Ps.	3,216,584	Ps.	3,101,538	Ps.	2,149,658

Financial expenses		(121,794)		(118,892)		(133,171)

Net income before taxes		3,094,790		2,982,646		2,016,487
Income tax expense		(61,411)		(66,662)		(51,568)
Net income	Ps.	3,033,379	Ps.	2,915,984	Ps.	1,964,919


	December 31,		December 31,		December 31,
Condensed separate Cash flow	2019		2018		2017
Net income	Ps.	3,033,379	Ps.	2,915,984	Ps.	1,964,919
Adjustments to reconcile net income to net cash used by operating activities		(1,753,640)		(1,785,764)		(880,322)
Net cash provided by operating activities		1,279,739		1,130,220		1,084,597
Net cash provided (used in) by investing activities		(145)		(144)		(295)
Net cash (used in) provided by financing activities		(1,267,976)		(1,128,498)		(1,096,011)
Increase (decrease) in cash and cash equivalents		11,618		1,578		(11,709)
Effect of foreign currency changes on cash and cash equivalents		1,014		1,611		(93)
Cash and cash equivalents at beginning of year		38,667		35,478		47,280
Cash and cash equivalents at end of year	Ps.	51,299	Ps.	38,667	Ps.	35,478

Basis for presenting and summary of significant accounting policies

The attached separated financial statement of Grupo Aval have been prepared in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB), and their interpretations from the International Financial Reporting Standards Committee (IFRIC), currently in force and on the basis of historic cost, except for financial assets at fair value through profit or loss.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with IFRS have been condensed or omitted.

The separated financial statements of Grupo Aval have been prepared using the same IFRS basis and principles that Grupo Aval used to prepare it consolidated financial statements described in Note 2, except as provided below for its investments in subsidiaries and associates.

Commitments and contingencies

In the normal course of business, certain subsidiaries of Grupo Aval are defendants in various tax and legal proceedings. Grupo Aval is not aware of any pending legal proceedings which could have a significant effect on its financial position or the results of its operations.

Investment in subsidiaries and associates companies

Based on the IAS 27, when an entity prepares separate financial statements it shall account for investments in subsidiaries either: a) at cost or b) at fair value, in accordance with IFRS 9 or c) using the equity method. Accordingly Grupo Aval accounts for its investments in subsidiaries using the equity method.

The equity method is an accounting method according to which the investment is initially reconizes at cost, and they are periodically adjusted due to changes in the interest of the parent company over the net assets of the subsidiaries. Grupo Aval records on the result of the period its participation in the profit or loss of the subsidiaries, and in OCI its participation in the “Other comprehensive income account” of the subsidiary. In applying equity method Grupo Aval uses the subsidiaries consolidated financial statements at the end of the period prepared under IFRS.

Gain and losses resulting from transactions between Grupo Aval and its subsidiaries are recognized in the Grupo Aval´s financial statement only to the extent of Grupo Aval´s interest in the subsidiaries, unless the transaction provides evidence of an impairment in the book value of transferred assets.

Additionally, in a business combination process, to acquire some subsidiaries any difference between the cost of investment and Grupo Aval’s share on the net fair value of the subsidiary identifiable acquired assets and assumed liabilities is accounted as follows:

Goodwill relating to the acquisition is included in the carrying amount of the investment. Amortization of goodwill is not permitted.

Appropriate adjustments to Grupo Aval’s investments in the subsidiary after acquisition are made to account for example for depreciation of assets acquired in the business combination process based on their fair value at the acquisition date and for the impairment losses in such assets.

Investment in Subsidiaries and Associates

Investment in subsidiaries and associates as of December 31, 2019 and 2018 comprise the following:


	December 31, 2019				December 31, 2018
	Ownership				Ownership
	interest held				interest held
	by Grupo		Book		by Grupo		Book
Subsidiary	Aval		Value		Aval		Value
Banco de Bogotá S.A.	68.74	%	Ps.	13,325,612	68.74	%	Ps.	11,905,815
Banco de Occidente S.A.	72.27	%		3,415,545	72.27	%		3,183,351
Banco Comercial AV Villas S.A.	79.87	%		1,410,765	79.87	%		1,290,056
Banco Popular S.A.	93.74	%		3,074,428	93.74	%		2,923,562
Corporación Financiera Colombiana S.A.	38.63	%		821,827	38.25	%		674,484
Sociedad Administradora de Fondos de Pensiones y Cesantías Porvenir S.A.	75.67	%		503,993	75.69	%		440,707
Grupo Aval Limited	100	%		(535,893)	100.00	%		(347,082)
Grupo Aval International Limited (1)	—	%		—	100.00	%		(138,517)
Total subsidiaries			Ps.	22,016,277			Ps.	19,932,376


Associates
ADL Digital Lab S.A.S	34.00	%		404				—
Total associates				404				—

Total investment in subsidiaries and associates			Ps.	22,016,681			Ps.	19,932,376

⁽¹⁾

See note 1 reporting entity.

Outstanding bonds

Bonds at December 31, 2019 and 2018 comprise the following:


						Amounts outstanding
Issuance date	Tranches		Maturity	Coupon rate		2019		2018

November, 2019	Ps.	100,000	November, 2024	6.42	%	Ps.	100,824	Ps.	—
November, 2019		300,000	November, 2039	IPC + 3.69	%		302,951		—
June, 2017		100,000	June, 2020	IPC + 2.69	%		100,071		100,065
June, 2017		300,000	June, 2042	IPC + 3.99	%		300,255		300,237
November, 2016		93,000	November, 2026	IPC + 3.86	%		93,741		93,690
November, 2016		207,000	November, 2036	IPC + 4.15	%		208,709		208,597
December, 2009		279,560	December, 2019	IPC + 4.84	%		-		281,341
December, 2009		124,520	December, 2024	IPC + 5.20	%		125,404		125,348
Total Bonds	Ps.	1,504,080				Ps.	1,231,955	Ps.	1,109,278

The scheduled maturities of bonds as of December 31, 2019 are as follows


Period	Amount
2020		107,435
2021		—
2022 and thereafter		1,124,520
Total	Ps.	1,231,955