Economic and financial analysis

Economic situationhttps://www.anacom.pt/render.jsp?contentId=55129

Financial situationhttps://www.anacom.pt/render.jsp?contentId=55130

During the 2009 financial year, the economic and financial activity of ICP-ANACOM was marked by a number of aspects, the most of important of which are described below:

entry into force of the new tariff model, approved by Administrative Rule no. 1473-B/2008 of 17 December. The new fee system, as discussed in this report, enables, for the first time, the application of fees with respect to the activity of supplier of electronic communications networks and services, whereas the amount of fees applicable for the use of frequencies is significantly reduced. Being the first year of the model’s implementation, its impact in fiscal year 2009 is not yet fully felt, whereby the total fees collected reported a slight variation (positive) over the previous year. It should be noted, however, that with regard to mobile telephony, the level of risk in the new model is higher than in the previous one, insofar as fees related to the use of frequencies will now be dependent on those which are allocated and not the number of mobile phone service SIM cards in the market; as such any return of spectrum will have a negative impact on the income of this Authority (regardless of the positive effects that such returns may have from the standpoint of radio spectrum management).
award of sponsorship to FCM, to the value of 10 million euros, following a request made by this entity to finance the projects developed under the e.escolinhas (e-schools) project, promoted by the Government. This sponsorship follows the decision of the Government, through joint Administrative Rules issued by the Minister of State and for Finance and the Minister for Public Works, Transport and Communications to assign a part of the profits of ICP-ANACOM for the years 2007 and 2008 to FCM, totaling 36.529 million euros. It should be noted that the awarded sponsorship merited an order of the Minister for Public Works, Transport and Communications, and has naturally been reflected in the results for the year 2009, receiving formal Government approval, in particular through the necessary budget amendment approval. This decrease in net income is in fact the only impact of that decision, since there is no implication in terms of the fees charged by ICP-ANACOM, including the fees charged for exercising the activity of electronic communications networks and services, which reflect the costs of regulation incurred by this Authority, in which costs the cited sponsorship was not included;
hosting of the 4th World Telecommunication Policy Forum (WTPF-09) following the order of the Secretary of State for Public Works and Communications, with costs totaling 2.661 million euros. With regard to its impact in terms of costs incurred by ICP-ANACOM, the same considerations apply as those described above;
payment made with respect to the European Space Agency (ESA) Programme, pursuant to the Protocol signed by the Ministers for Environment and Spatial Planning, and for the Economy and for Science and Technology, and as provided for under Joint Order no. 215/2002 of 28 February 28, extended to 2011 by Joint Order no. 21229/2007 of 13 September, to the value of 3.037 million euros, whereas the payment of the previous year totaled 1 million euros.

In total this year, and largely as a result of the above items, the results reported for the year fell by about 39 % over the previous year, with revenues increasing by about 3 % and costs by about 23%. It should be noted, however, that if the three initiatives mentioned above, with their severe impact on costs, had not occurred, the results would have been positive to the amount of 29.298 million euros (+22.8% compared to 2008) and costs would have declined (on a nominal basis) by about 3.028 million euros (-5.9%) compared to the previous year. If that analysis is made without considering provisions, there would have been a nominal increase in costs of around 1.8% over the two years.

Economic situation

The net result obtained by ICP-ANACOM in 2009 was positive by 14,597,596 euros, representing 19% of overall income and earnings.

**Economic situation - Table 3.1**
Results	2009		2008		2007
Income and Earnings	77,883,098	100%	75,471,885	100%	83,520,958	100%
Operating Income and Earnings	74,780,405	96%	71,610,694	95%	81,373,884	97%
Operating Costs and Losses	63,245,624	81%	51,031,865	68%	62,618,052	75%
Operating results	11,534,781	15%	20,578,829	27%	18,755,832	22%
Financial results	2,483,177	3%	3,403,112	5%	1,953,500	2%
Extraordinary results	579,638	1%	-125,723	0%	-86,431	0%
Net result	14,597,596	19%	23,856,218	32%	20,622,901	24%

^{Unit: euros}

**Continuation. Economic situation - Table 3.1**
Results	Variation 2009/2008
Income and Earnings	2,411,213	3.2%
Operating Income and Earnings	3,169,711	4.4%
Operating Costs and Losses	12,213,759	23.9%
Operating results	-9,044,048	-43.9%
Financial results	-919,935	-27.0%
Extraordinary results	705,361	-561.0%
Net result	-9,258,622	-38.8%

^{Unit: euros}

In the determination of operating results, it appears that costs and operating losses have increased in nominal terms compared to 2008, outpacing operating income and earnings, 23.9 % and 4.4 % respectively. It should be noted that the increase in operating costs and losses was due in great part to the award of sponsorship to FCM and the hosting of WTPF-09, whereas in the absence of these two initiatives, this item would have posted a decline of 0.9 % compared to 2008.

With respect to the financial results, the negative variation of approximately 27 % compared to 2008 was due mainly to the sharp decline observed in the average interest rate payable on deposits associated with the financial environment that characterized the year 2009. Meanwhile, the values derived from financial applications was lower, due to the fact that the issue and collection of invoicing by ICP-ANACOM under the new model is performed on an annual basis, whereby, in this first year, it only took place at the end of the year; additionally, payment with respect to the application of the results obtained from the 2008 financial year (delivery to the state) was made earlier than in the previous year, pursuant to Administrative Rule no. 423/2009 of 22 April. The combination of these factors led to a decline of 27.4 % in financial income compared to the previous year.

As far as the extraordinary results are concerned, the increase seen results from the occurrence of two situations: the forfeiture of the provisional bond of 250 thousand euros, presented by RNT - Rede Nacional de Telecomunicações, S. A., following their withdrawal from the tender for the allocation of 450 MHz - Mobile Service - CDMA 2000 frequencies, which reverted in favor of ICP-ANACOM, and an accounting adjustment in respect of part of the cost of the productivity bonuses awarded to ICP-ANACOM staff for the year 2008 but paid in 2009, which had been specified in the 2008 accounts by the value contained in the budget, but whose amount, due to the strict allocation of these bonuses tied to performance evaluation, was in fact overstated by 242 thousand euros.

The detail of the evolution of income and earnings is shown in table no. 3.2, whereas the occurrence of an overall increase of 3.2 % can be noted under this heading.

**Evolution of income and earnings - Table 3.2**
Income and Earnings	2009	2008	2007	Variation 2009/2008
Electronic communications	72,202,513	70,470,067	80,540,989	2.5%
Annual activity fees	10,961,389	585,464	506,704	1.772.3%
Fees for use of frequencies	60,606,834	69,884,603	80,034,285	-13.3%
Fees for use of numbers	621,490	0	0
Issued and awarded declarations and rights	12,800	0	0
Remaining Provisions of Service	745,621	690,714	731,487	7.9%
Services fees Citizen Band - CB	98,688	129,962	144,357	-24.1%
Services fees amateur - SAAS	109,681	59,161	59,124	85.4%
Postal services	161,000	143,400	173,253	12.3%
ITED	154,528	119,242	134,274	29.6%
Others	221,724	238,949	220,479	-7.2%
Financial Income and earnings	2,501,542	3,446,942	1,966,119	-27.4%
Other income and earnings	2,433,422	864,162	282,363	181.6%
Operation subsidies	48,872	58,289	100,145	-16.2%
Reversals	1,652,868	379,126	0	336.0%
Others	731,682	426,747	182,218	71.5%
Totals	77,883,098	75,471,885	83,520,958	3.2%

^{Unit: euros}

In the present financial year, the structure of income and earnings has been substantially altered compared to 2008, reflecting the entry into force, on 1 January 2009, of the new fee model.

As already indicated, this new model introduced a new approach to the fees payable to ICP-ANACOM, which are now as follows, under the Electronic Communications Law: a) fees associated with the exercise of the activity of electronic communications networks and services provider, under the terms of point b) of article 105 of Law no. 5/2004 of 10 February; b) fees due for declarations supporting rights issued by ICP-ANACOM, under the terms of point a) of this article; c) fees associated with the use of numbers and the reservation thereof, as well as their respective use, under the terms of points d) and a) of this article, respectively; and d) fees due for the assignment of rights of use of frequencies and due for the use of frequencies, under the terms of points c) and f) of this article, respectively.

It is noted that in implementing the new fee model, a transition period of three years was put in place until its full implementation (five years for the radio and television broadcasting service), in order to avoid disruptions and provide for a smoother transition between the two models. During this transition period, both models will coexist in parallel, whereas in the year being reported the fees applied correspond to 33 % of the new model and 66 % of the previous model (with appropriate adjustments in the case of broadcasting).

In respect of fees for the use of radio spectrum, the new model is based on applying a fee to the amount of spectrum allocated to each entity, regardless of their level of use, to ensure efficient use of this resource.

Table no. 3.3 presents a comparison of fees charged for use of frequencies by type of service.

**Evolution of the fees paid for use of frequencies - Table 3.3**
Services	2009		2008
Public Land Mobile Service	49,414,655	81,5%	59,815,080	85.6%
Land Mobile Service - Private Networks	2,605,955	4,3%	2,565,335	3.7%
Fixed Radio Service	6,673,412	11,0%	5,731,764	8.2%
Satellite Radio Services	533,732	0,9%	563,602	0.8%
Radio and Television Broadcasting Service	308,381	0,5%	319,476	0.5%
Mobile Trunking Service	469,619	0,8%	274,308	0.4%
Other Services	601,080	1%	615,038	0.9%
Total	60,606,834	100%	69,884,603	100%

^{Unit: euros}

**Continuation. Evolution of the fees paid for use of frequencies - Table 3.3**
Services	Variation 2009/2008
Public Land Mobile Service	-10,400,425	-17.4%
Land Mobile Service - Private Networks	40,620	1.6%
Fixed Radio Service	941,648	16.4%
Satellite Radio Services	-29,870	-5.3%
Radio and Television Broadcasting Service	-11,095	-3.5%
Mobile Trunking Service	195,311	71.2%
Other Services	-13,958	-2.3%
Total	-9,277,769	-13.3%

^{Unit: euros}

With respect to fees on the exercise of the activity of provider of electronic communications networks and services, it is noted that they are determined according to the costs incurred by ICP-ANACOM as a result of its regulatory activities, calculated using three-year moving averages, except with respect to the costs of increasing provisions for ongoing legal proceedings for which a five-year moving average is used. Such costs do not include any costs associated with activities that ICP-ANACOM develops outside the regulation of electronic communications networks and services, and its distribution among providers of electronic communications networks and services is made in proportion to relevant income (related to their activity), for the year preceding that in which the fee is due. Exceptions are provided for operators whose relevant income does not exceed 100,000 euros, in which cases a zero fee is applied, and those whose relevant income does not exceed 1,500,000 euros, from which a fixed fee of 2,500 euros is due.

It should also be noted that on 14.10.2009 ICP-ANACOM published a report providing the formula used for calculating the costs associated with this fee, since, pursuant to paragraph 5 of Article 105 of Law no. 5/2004 of 10 February, this Authority is bound to publish an annual report of its administrative costs and of the total sum resulting from the collection of fees referred to in points a) to d) of paragraph 1, in order to perform the appropriate adjustments in respect of the difference (where applicable) between the total sum of the charges and the administrative costs.

Table no. 3.4 presents the details of the calculation of costs with respect to administrative expenses that led to the collection of fees in 2009.

**Calculation of costs to determinate the fees from suppliers of electronic communications network and services - Table 3.4**
Costs to determinate the fees from suppliers of electronic communications network and services	Breakdown of ICP-ANACOM costs (ex provisions associated with EC)
	2009 (1)(2)	2008	2007	Average (3 years)
1. Costs of regulation and spectrum management	48,247,907	47,751,312	41,705,879	45,901,700
1.1 Costs relating to Electronic Communications	38,369,021	38,832,208	34,190,267	37,130,499
1.1.1 Administrative Costs	27,483,576	24,813,409	23,347,969	25,214,985
a) Declarations supporting rights	87,183	78,713	77,488	81,128
b) Exercise of activity of supplier networks and services	25,834,645	23,324,680	22,532,560	23,897,295
c) Allocation of rights of use of frequencies	1,414,140	1,276,749	589,393	1,093,428
d) Allocation of rights of use of numbers	147,607	133,266	148,529	143,134
1.1.2 Frequency management costs	10,809,396	13,950,140	10,716,456	11,825,331
1.1.3 Numbering management costs	76,048	68,660	125,841	90,183
1.2 Postal regulation costs	2,799,095	2,527,149	1,681,734	2,335,993
1.3 Other costs of regulation	7,079,792	6,391,954	5,833,879	6,435,208
2. Other costs	8,531,593	3,820,472	3,868,452	5,406,839
3. Total Costs	56,779,500	51,571,784	45,574,332	51,308,539

^{Unit: euros}

**Continuation. Calculation of costs to determinate the fees from suppliers of electronic communications network and services - Table 3.4**
Costs to determinate the fees from suppliers of electronic communications network and services	Provisions related to EC (average of 5 years)	Breakdown of costs of ICP-ANACOM (with EC associated provisions)
	Provisions related to EC (average of 5 years)
1. Costs of regulation and spectrum management	9,139,674	55,041,374
1.1 Costs relating to Electronic Communications	9,139,674	46,270,173
1.1.1 Administrative Costs	9,139,674	34,354,659
a) Declarations supporting rights		81,128
b) Exercise of activity of supplier networks and services	9,139,674	33,036,969
c) Allocation of rights of use of frequencies		1,093,428
d) Allocation of rights of use of numbers		143,134
1.1.2 Frequency management costs		11,825,331
1.1.3 Numbering management costs		90,183
1.2 Postal regulation costs		2,335,993
1.3 Other costs of regulation		6,435,208
2. Other costs		5,406,839
3. Total Costs	9,139,674	60,448,213

^{Unit: euros}

According to this new model, invoicing is issued once only, in September of each year. Exceptionally, in 2009, billing was issued in three phases, covering the radio spectrum, except for the Amateur and Amateur Satellite Services (AASS) in mid-October; numbering, Audiotext and postal services, in late October, the fee due for the activity of provider of electronic communications networks and services and the fee of the AASS in late November.

In terms of a comparison between the results of the last two financial years, note should be made of:

Income derived from collecting the fees provided for in Lei das Comunicações Electrónicas (the Law of Electronic Communications) - in spite of the profound changes observed in the tariff model applicable to electronic communications, the overall amount of income and earnings was not substantially different from the previous year, translating into a positive variation of 2.5 %, which was due in part to the fact that this is the first year of transition between models;
Other services, incorporating remaining income comprised by the activities of ICP-ANACOM, including the fees associated with access to and the exercise of postal services, fees applicable to the activity associated with the installation of Telecommunications Infrastructures in Buildings (ITED), laboratory testing, fees applicable to access to and the exercise of the activity of Audiotext services, surcharges for late payment of fees and fines resulting from enforcement activities. The reported values show an increase of 7.9 %, with a notable increase seen in ITED fees (new inscriptions) and in the fees of the AASS;
Financial income, which records interest on deposits, term deposits and late payment interest. The negative variation of 27.4 % compared to 2008 was due primarily to the described sharp decline observed in the average interest rate payable for deposits and the decrease in average cash levels during the year 2009;
Other income and earnings, includes items such as operation subsidies (travel reimbursements by the European Union), reversals, additional income and extraordinary income and earnings. In this area, note should be made of a reversal of the adjustments made in previous years with respect to the debt which Bragatel - Companhia de Televisão por Cabo de Braga, S. A. maintained with ICP-ANACOM, resulting from the non-payment of fees for spectrum use, (about 1.653 million euros), since this debt was assumed and settled by ZON TV Cabo, S.A following this company’s takeover of Bragatel and the subsequent transfer of licenses. Under the same heading, note should also be made of the accounting adjustment made with respect to a specified cost in 2008 concerning productivity bonuses, for which the actual amount paid out in 2009 was 242 thousand euros less than that accounted; and the forfeiture in favor of ICP-ANACOM of a provisional bond due to the withdrawal of a company from the tender for the allocation of rights of use of frequencies, as already mentioned, which amounted to 250 thousand euros.

Table 3.5 shows the detail of the evolution of costs and losses, which shows an increase of 22.6% compared to the previous year. However, as already noted, if the value of 10 million euros corresponding to the sponsorship awarded to FCM, the hosting of WTPF and the payment of a higher value to ESA than that paid in 2008 are excluded, there was a nominal decrease in costs over the previous year of 6%. If this analysis is performed excluding provisions, the variation over 2008 was about 1.7%. A comparison of costs by their nature is given below.

**Evolution of costs and losses - Table 3.5**
Costs and Losses	2009	2008	2007	Variation 2009/2008
Supplies and External Services	12,137,150	10,385,106	10,041,970	16.9%
Rents and Leases	1,779,963	1,653,045	1,632,673	7.7%
Travel, accommodation, representation	678,803	755,006	775,077	-10.1%
Specialized works,	3,788,730	2,716,496	1,965,880	39.5%
Maintenance and Repair	2,262,456	2,149,230	2,564,824	5.3%
Communication	741,897	719,530	739,932	3.1%
Publicity and Advertising	343,693	81,753	49,569	320.4%
Buildings' common costs	1,082,903	1,033,182	1,046,966	4.8%
Other Supplies and Services	1,458,705	1,276,864	1,267,049	14.2%
Personnel costs	23,055,692	23,386,993	20,802,154	-1.4%
Remunerations and Costs	21,215,909	20,402,692	19,450,365	4.0%
Other personnel costs	1,839,783	2,984,301	1,351,789	-38.4%
Other costs and losses	23,942,066	10,076,295	9,655,304	137.6%
Subscriptions	1,001,088	928,301	975,353	7.8%
Meetings and Conferences	3,326,668	473,452	283,407	602.6%
Contributions to external entities	16,236,549	6,910,011	6,177,678	135.0%
Participations	3,039,071	1,000,000	1,763,712	203.9%
Other Costs and Losses	338,690	764,531	455,154	-55.7%
Amortizations of assets	3,813,381	3,532,460	3,309,678	8.0%
Period adjustments	0	0	23,224
Provisions	337,213	4,234,813	19,065,727	-92.0%
Totals	63,285,502	51,615,667	62,898,057	22.6%

^{Unit: euros}

With respect to items whose evolution has resulted in a reduction of costs, note should be made of:

Provisions, which records the provisions made in light of the risk of being ordered to pay compensation with respect to ongoing legal proceedings. Regarding this item, the criterion followed in 2008 was maintained, corresponding in general to the constitution of a provision to cover 50% of the value of damages sought, which percentage was adjusted for cases where a greater or lower level of predictable risk justifies a different percentage of coverage. Application of this criterion determined an addition of provisions below that of the previous year, by 92%;
Travel and accommodation, which includes transportation, hotel stays and food for ICP-ANACOM staff, while on trips in Portugal and abroad, whose weights as a proportion of the total are reported as 24% and 76% respectively, while the weight of transportation is 70% and accommodation 30%. With respect to travelling abroad table no. 3.4 shows the indicators for the last three years:

**Evolution of travel and accommodation - Table 3.6**
Evolution of travel and accommodation	2009	2008	2007	Variation 2009/2008
Trips	419	416	425	2.9%
Days	1,895	1,843	1,683	2.8%
Average cost per trip	829 €	943 €	931€	-12.1%

^{Unit: euros}

It is important to note that the decrease of about 10% in the value of this item, compared to 2008, is due mainly to a reduction in transportation costs, which led to a decrease in the average cost per trip, since both the number of journeys, and the number of days recorded in 2009 were higher than the same period in 2008.

It is important to note here that some of these costs are offset by compensation, with respect to the participation of ICP-ANACOM in meetings promoted within the European Union. Such compensation is recorded as subsidies and therefore the gross cost of travel is considered under this heading. If the net cost of this travel were considered, the value for 2009 would have amounted to 303.2 thousand euros, instead of 347.4 thousand euros.

Personnel costs, which records salaries, charges and other personnel costs. It should be noted that, compared to the year 2008, there was a reduction of 1.3 % under this heading, a situation that merits a more detailed assessment, given its weight in ICP-ANACOM’s cost structure.

The evolution of wages and charges (remuneration of the Management Board, Audit Committee and ICP-ANACOM staff) is as follows:

**Remuneration and costs - Table 3.7**
Remuneration and costs	2009	2008	Variation
Remuneration	18,315,213	17,605,477	4.0 %
Charges on remuneration	2,900,696	2,797,215	3.7 %
Total	21,215,909	20,402,692	4.0 %

^{Unit: euros}

The 4 % increase primarily reflects the effect on the salaries and charges of ICP-ANACOM staff resulting from the 2% update of pay scales and promotions by merit taking place following the application of the Merit Based Evolution System. The remunerations levels of the Members of the Management Board and the Audit Committee were unchanged from 2008.

Regarding the evolution of other personnel costs, the following is shown:

**Other personnel costs - Table 3.8**
Other personnel costs	2009	2008	Variation
Pension charges - ex-CTT staff	0	1,393,558	-100.0%
Healthcare - retirement benefits for ex-CTT staff	121,057	77,057	57.1%
Supplementary pension	282,384	267,430	5.6%
Training	338,008	425,106	-20.5%
Other personnel costs	1,098,334	821,149	33.8%
Total	1,839,783	2,984,300	-38.4%

^{Unit: euros}

The variation seen under the Other Personnel Costs heading reflects the good performance of ICP-ANACOM’s Pension Fund, with 8.7 % profitability reported in 2009, which determined that it was not necessary to account for any cost during the period, contrary to the situation in 2008. It is also of note that the costs of training were lower than in 2008, by 20.5 %.

Under the sub-heading Other Personnel Costs, the cost resulting from the ICP-ANACOM Meeting - 20. Anniversary event is reported; an increase is reported in retirement benefits (health care) as a consequence of the results of the actuarial study commissioned by ICP-ANACOM and the increase in health insurance, due to the increase in the number of members covered and coverage of employees’ children.

Regarding the items that have the largest increases, note is made of:

Specialized Works, which includes the sum of costs, incurred though the execution of studies, reports, audits and the provision of other service required to support the work of ICP-ANACOM in specific areas where there is no justification to contract staff. The figure reported under this heading was 39.4 % higher than in the previous year, whereas the following categories of works are noted:

**Specialized works - Table 3.9**
Specialized works	2009	2008	Variation
Studies	1,391,366	1,005,200	38.4%
Audit services	471,054	394,243	19.5%
IT consultancy	675,829	238,861	182.9%
Legal consultation	309,635	358,773	-13.7%
ITED consultancy	134,296
Translations	151,212	94,236	60.5%
ANACOM website	152,560	105,083	45.2%
Telecommunications consultancy	126,307	114,266	10.5%
Other	376,471	405,834	-7.8%
Total	3,788,730	2,716,496	39.4%

^{Unit: euros}

As regards the costs of Studies the following works are highlighted in 2009: Electronic Communications Services Consumer Survey; Postal Services Consumption Survey; Evaluation Study of the Quality of Service of Broadband Internet Access and Vertical Functional Separation in the Electronic Communications Sector - What are its Implications for the Portuguese Market?.

In terms of Auditing Services, note is made of the audits on the indicators of service quality and of the complaints system of CTT and auditing of the indicators of quality of the service of access to the local loop service and the leased lines service of PTC; the audit of the statistical items of the 2005 Mobile Telephone Service, with reference to the 1st half of 2008; and all audits required with respect to the concession contracts of the Universal Postal Service and the Public Telecommunications Service, including (i) audit of the 2007 results of the analytical accounting system of CTT., and (ii) the audit of the regulatory accounting of PTC, for the year 2006.

Under consultancy services, note is made of the legal opinions and instruction with respect to the actions brought against ICP-ANACOM with respect to regulation, as well as the technical consultation in the areas of information systems, telecommunications and ITED.

Publicity and advertising, which includes advertising campaigns which ICP-ANACOM has conducted in order to spread relevant information and facts which are of particular interest to consumers in general.

In the present year, initiatives undertaken involving disclosures with significant values, include, most notably, the campaigns for the dissemination of the international roaming regulation, the auction of BWA frequencies, the publication of announcements of Government tenders on next generation networks, the disclosure of facts of general interest, including, new regulation and settlement fees of ICP-ANACOM, the new Amateur regulation and the launch of ICP-ANACOM’s new image, as part of the 20th anniversary celebrations of this Authority.
Meetings and conferences, which includes all events promoted by ICP-ANACOM, nationally and internationally. Examples include meetings held in the context of working groups and the conferences and seminars organized within the communications sector. The increase reported under this heading, compared to 2008, is due mainly to the Organization and hosting of the previously mentioned 4th World Telecommunication Policy Forum (WTPF-09).
Participations, which includes costs related to the cooperation and partnership protocols which are binding upon ICP-ANACOM, in some cases since 1999, whereas it is noted that no new protocols have been entered into since 2006 and many previously existing protocols are now concluded and terminated. The value reported in 2009 reflects payments made to ESA, which values are governed by the protocol signed by ESA and the Portuguese State on 14 November 2000.
Depreciation of tangible and intangible fixed assets, which record the value of annual depreciation of property included in the fixed assets of ICP-ANACOM, calculated in accordance with the rates provided for in Regulatory Decree no. 2/90 of 12 January. The established amount of depreciation for the period was 8 % higher than in 2008, reflecting the entry into operation of a large part of the assets over the course of the previous year.
Contribution to external entities, which includes the sum of contributions made to external entities, taking into account the obligations imposed by decree-law or government order (CPEC, FPC, AdC and FCM) and also those that are within the remit of the Management Board. Table 3.10 presents a breakdown of these costs.

**Contribution to external entities - Table 3.10**
Contribution to external entities	2009	2008	Variation
Autoridade da Concorrência	4,425,648	4,989,528	-11.3%
Fundação Portuguesa das Comunicações	1,045,649	1,058,883	-1.2%
Cpec - comissão planeamento comunic. Emergência	346,985	356,681	-2.7%
Other contributions (sponsorships)	10,418,267	504,919	1.963.4%
Total	16,236,549	6,910,011	135.0%

^{Unit: euros}

In the evolution seen under this heading, note should be made of the award of sponsorship, as already mentioned, to FCM to promote the e.escolinha (e-school) initiative, to the amount of 10 million euros.

Under the remaining headings, the values reported were lower than those of the preceding financial period.

Financial situation

From an analysis of table 3.11 it is concluded that in the 2009 financial year, in line with recent years, ICP-ANACOM was able to guarantee that it had the capacity to carry on its activities, in terms of operating costs, using its own recourse, and was also able to fully finance its own investments.

**Balance structure - Table 3.11**
Balance structure	2009	2008	2007	Balance structure	2009
Total assets	100%	100%	100%	Equity capital
Fixed assets	15%	16%	18%	Revaluation reserves	2,238,778
Floating capital	85%	84%	82%	Special reserves	36,105,536
				Net result	14,597,596
Total liabilities + equity capital	100%	100%	100%	Floating capital
Equity capital	47%	51%	50%	Third party debts	5,089,498
Liabilities	53%	49%	50%	Deposits and Cash	86,788,729
				Accruals and deferrals	3,566,007
				Liabilities
				Provisions	51,765,163
				Debts to third parties	3,175,929
				Accruals and deferrals	5,037,030

^{Unit: euros}

With respect to the asset structure, the relative weight of net assets decreased slightly in comparison to floating capital. Reductions were observed for both headings, in absolute terms. The decrease in net assets was driven by a reduction in investment and the significant value of decommissioning and adjustments to fixed assets. In the structure of liabilities and equity capital, there was an increase in the level of liabilities over equity capital. While liabilities increased, primarily due to an increase in provisions made in respect of ongoing legal proceedings, equity capital levels also declined, given the difference between the value of delivery to the State (euros 21,000,000) and the net result for 2009 (euros 14,597,596) and also due to the reduction of Special Reserves (euros 571,270) resulting from the theft from the collection of stamps of the former Portuguese overseas colonies (ex-ultramar).

Overall, the financial structure remains solid and balanced, enabling ICP-ANACOM to continue to secure the resources it needs to carry on the activity with which it has been charged, thereby guaranteeing the financial autonomy which is established in its Statutes and which is fundamental in ensuring the regulator’s independence.