IBERSOL | Integrated Management Report | 2025

CONSOLIDATED FINANCIAL STATEMENTS In cases where the transaction does not meet the requirements to be accounted for as a sale, the asset continues to be recog- nized in the Group’s balance sheet and a financial liability equal to the transfer proceeds is recognized, accounted for as a finan- cial liability in accordance with IFRS 9. Judgments and estimates Lease term and incremental financing rate The Group estimates lease terms and the incremental financing rate. The Group determines the lease term as the non-cancellable period of the lease, taking into account the periods covered by an option to extend the contract, if it is reasonable for the Group to exercise it, or any periods covered by an option to terminate. the contract, if it is reasonably certain that the Group will not exercise it. When determining the lease term, the Group therefore makes a judgment about the relevant factors that create an economic incentive to exercise the renewal or termination (in cases where such options are of the lessee and the lessor, the Group exercises judgment about the lessor and lessee economic incentives). Among other aspects, the Group takes into account: - the value of the non-transferable investments made in each commercial space and the estimate of the period for recovery and use of such investments; - if the renewal/termination option takes place in a shorter or more distant time horizon (the shorter the non-cancelable period of the contract, the greater the probability that the Group will exercise the renewal option, the opposite being true in the case of contracts with long non-cancellable periods) - conditions for contract renewal – for example with regard to the renewal period or rent conditions - termination penalties - location of assets and existence of viable alternatives for other commercial spaces. 460