IBERSOL | Integrated Management Report 2022

Consolidated Financial Statements 3.3. Quality and food safety risks Ibersol Group’s quality department is responsible for identifying and ensuring con- trol of food quality and safety risks. Thus, various prevention and control measures are implemented for different areas of the Group’s business. In this context, some measures stand out, such as: ensuring the implemented Traceability System and the control of the Production Process in the units, through the HACCP (Hazard Analysis & Critical Control Points) System. 3.4. Price Risk Significant changes in commodity prices are largely reflected in the selling prices of products and monitored by the market. However, when commodity price increases are much higher than general inflation, these changes are gradually impacted in sell- ing prices, and in the short term there may be a degradation of the gross margin. 4. Operational Performance 4.1. Revenue Accounting policies Revenue is measured at the amount the entity expects to be entitled to receive un- der the contract with the customer. Recognition The revenue recognition model is based on five analytical steps, in order to deter- mine when revenue should be recognized and the amount to recognize: 1) Identify the contract with the customer; 2) Identify the performance obligations; 3) Determine the transaction price; 4) Allocating the transaction price; and 5) Revenue recognition. Revenue is recognized only when the performance obligation is satisfied, which de- pends on whether the performance obligations are satisfied over time or whether control over the good or service is transferred to the customer at a point in time. Revenue is recognized as follows: Sale In Group’s sales of goods, there is only one performance obligation and therefore revenue is recognized immediately upon delivery of the goods to the customer. A performance obligation corresponds to a commitment to deliver goods or services to customers that are distinct from each other. 398