Company: CTTRF
Filing Date: 2025-04-30
Form Type: 20-F
Source: 0001292814-25-001765
Chunk: 309

Company: Controladora Vuela Compania de Aviacion, S.A.B. de C.V.
Filing Date: 2025-04-30
Form: 20-F
Item: Item 19
Chunk 309
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 profit or loss when the liabilities
are derecognized as well as through the EIR amortization process.

Amortized cost is calculated by taking into account any discount
or premium on issuance and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the
consolidated statements of operations. This amortized cost category generally applies to interest-bearing loans and borrowings (Note 5).

Financial liabilities at FVTPL

Financial liabilities at FVTPL include financial liabilities
under the fair value option, which are classified as held for trading, if they are acquired for the purpose of selling them in the near
future. This category includes derivative financial instruments that are not designated as hedging instruments in hedge relationships
as defined by IFRS 9“ Financial Instruments.”

Derecognition

A financial liability is derecognized when the obligation
under the liability is discharged or cancelled or expires.

When an existing financial liability is replaced by another
from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange
or modification is treated as the derecognition of the original liability and the recognition of a new liability.

The difference in the respective carrying amounts is recognized
in the consolidated statements of operations.

Offsetting of financial instruments

Financial assets and financial liabilities are offset, and
the net amount is reported in the consolidated statement of financial position if there is:

  (i)      A currently enforceable legal right to offset the recognized amounts; and  

  (ii)      An intention to settle on a net basis, to realize the assets and settle  

g) Other accounts receivable

Other accounts receivable are due primarily from major credit
card processors associated with the sales of tickets and are stated at cost less allowances made for credit losses, which approximates
fair value given their short-term nature.

h) Inventories

Inventories consist primarily of flight equipment expendable
parts, materials and supplies, and are initially recorded at acquisition cost. Inventories are carried at the lower of cost or at their
net realization value, whichever is less. The cost is determined based on the method of specific identification and expensed when used
in operations. The Company recognizes the necessary estimates for decreases in the value of its inventories due to impairment, obsolescence,
slow movement and causes that indicate that the use or realization of the aircraft spare parts and flight equipment accessories that are
part of the inventory