Company: CTTRF
Filing Date: 2025-04-30
Form Type: 20-F
Source: 0001292814-25-001765
Chunk: 316

Company: Controladora Vuela Compania de Aviacion, S.A.B. de C.V.
Filing Date: 2025-04-30
Form: 20-F
Item: Item 19
Chunk 316
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 4,409.15      4,071.03      3,822.05      4,327.66      4,810.20      4,255.44  

n) Liabilities and provisions

Provisions are recognized when the Company has a present obligation
(legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required
to settle the obligation and a reliable estimate can be made of the amount of the obligation. If the effect of the time value of money
is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the risks specific to the liability.
Where discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.

o) Employee benefits

i) Personnel vacations

The Company and its subsidiaries in Mexico and Central America
recognize a reserve for the costs of paid absences, such as vacation time, based on the accrual method.

ii) Termination benefits

The Company recognizes a liability and expense for termination
benefits at the earlier of the following dates:

a) When it can no longer withdraw the offer of those benefits;
and

b) When it recognizes costs for a restructuring that is within
the scope of IAS 37, Provisions, Contingent Liabilities and Contingent Assets, and involves the payment of termination benefits.

The Company is demonstrably committed to a termination when,
and only when, it has a detailed formal plan for the termination and is without realistic possibility of withdrawal.

For the years ended December 31, 2024 and 2023, notermination
benefits provision has been recognized.

iii) Seniority premiums

In accordance with Mexican Labor Law, the Company provides
seniority premium benefits to the employees who rendered services to its Mexican subsidiaries under certain circumstances. These benefits
consist of a one-time payment equivalent to12days’ wages for each year of service (at the employee’s most recent salary,
but not to exceed twice the legal minimum wage), payable to all employees with15or more years of service, as well as to certain employees
terminated involuntarily prior to the vesting of their seniority premium benefit.

Obligations relating to seniority premiums, other than those
arising from restructurings, are recognized based upon actuarial calculations and are determined using the projected unit credit method.

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