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FOREIGN CURRENCY AND EXCHANGE RATE DIFFERENCES

12 Months Ended

Dec. 31, 2017

Foreign Currency And Exchange Rate Differences

FOREIGN CURRENCY AND EXCHANGE RATE DIFFERENCES

NOTE 29 - FOREIGN CURRENCY AND EXCHANGE RATE DIFFERENCES

The functional currency of LATAM Airlines Group S.A. is the US dollar, also it has subsidiaries whose functional currency is different to the US dollar, such as the chilean peso, argentine peso, colombian peso, brazilian real and guaraní.

The functional currency is defined as the currency of the primary economic environment in which an entity operates and in each entity and all other currencies are defined as foreign currency.

Considering the above, the balances by currency mentioned in this note correspond to the sum of foreign currency of each of the entities that make LATAM Airlines Group S.A. and Subsidiaries.

(a)	Foreign currency

The foreign currency detail of balances of monetary items in current and non-current assets is as follows:

	As of		As of
	December 31,		December 31,
Current assets	2017		2016
	ThUS$		ThUS$

Cash and cash equivalents		260,092		201,416
Argentine peso		7,309		4,438
Brazilian real		14,242		9,705
Chilean peso		81,693		30,221
Colombian peso		1,105		1,137
Euro		11,746		1,695
U.S. dollar		108,327		128,694
Other currency		35,670		25,526

Other financial assets, current		36,484		14,573
Argentine peso		21		12
Brazilian real		17		734
Chilean peso		26,605		585
Colombian peso		150		-
U.S. dollar		9,343		12,879
Other currency		348		363

	As of		As of
	December 31,		December 31,
Current assets	2017		2016
	ThUS$		ThUS$

Other non - financial assets, current		107,170		107,789
Argentine peso		16,507		16,086
Brazilian real		19,686		20,158
Chilean peso		34,258		1,619
Colombian peso		340		713
Euro		2,722		1,563
U.S. dollar		21,907		50,157
Other currency		11,750		17,493

Trade and other accounts receivable, current		373,447		251,204
Argentine peso		49,680		54,356
Brazilian real		22,006		30,675
Chilean peso		82,369		90,482
Colombian peso		1,169		9,720
Euro		48,286		21,923
U.S. dollar		34,268		14,086
Other currency		135,669		29,962

Accounts receivable from related entities, current		958		554
Chilean peso		735		554
U.S. dollar		223		-

Tax current assets		33,575		28,198
Argentine peso		1,679		1,798
Brazilian real		3,934		2,462
Chilean peso		3,317		6,333
Colombian peso		660		1,418
Euro		179		273
U.S. dollar		327		177
Peruvian sol		21,948		14,387
Other currency		1,531		1,350

Total current assets		811,726		603,734
Argentine peso		75,196		76,690
Brazilian real		59,885		63,734
Chilean peso		228,977		129,794
Colombian peso		3,424		12,988
Euro		62,933		25,454
U.S. Dollar		174,395		205,993
Other currency		206,916		89,081

	As of		As of
	December 31,		December 31,
Non-current assets	2017		2016
	ThUS$		ThUS$

Other financial assets, non-current		20,975		26,772
Brazilian real		3,831		2,769
Chilean peso		74		83
Colombian peso		281		285
Euro		7,853		6,966
U.S. dollar		7,273		14,920
Other currency		1,663		1,749

Other non - financial assets, non-current		9,108		19,069
Argentine peso		172		142
Brazilian real		6,368		6,029
U.S. dollar		38		8,309
Other currency		2,530		4,589

Accounts receivable, non-current		6,887		7,356
Chilean peso		6,887		7,356

Deferred tax assets		2,081		2,110
Colombian peso		86		117
Other currency		1,995		1,993

Total non-current assets		39,051		55,307
Argentine peso		172		142
Brazilian real		10,199		8,798
Chilean peso		6,961		7,439
Colombian peso		367		402
Euro		7,853		6,966
U.S. dollar		7,311		23,229
Other currency		6,188		8,331

The foreign currency detail of balances of monetary items in current liabilities and non-current is as follows:

	Up to 90 days					91 days to 1 year
	As of		As of			As of		As of
	December 31,		December 31,			December 31,		December 31,
Current liabilities	2017		2016			2017		2016
	ThUS$		ThUS$			ThUS$		ThUS$

Other financial liabilities, current		36,000		287,175			115,182		455,086
Chilean peso		21,542		55,962			79,032		108,010
U.S. dollar		14,458		231,213			36,150		347,076

Trade and other accounts payables, current		919,373		585,149			33,707		16,097
Argentine peso		122,452		20,838			8,636		907
Brazilian real		28,810		40,740			669		27
Chilean peso		233,202		60,701			11,311		12,255
Colombian peso		2,964		9,049			855		578
Euro		58,081		23,445			9,165		5
U.S. dollar		409,380		374,431			1,154		962
Peruvian sol		39,064		33,701			825		1,093
Mexican peso		2,732		1,535			115		-
Pound sterling		5,839		1,769			199		246
Uruguayan peso		1,890		6,899			-		-
Other currency		14,959		12,041			778		24

Accounts payable to related entities, current		760		220			-		-
Chilean peso		546		23			-		-
U.S. dollar		4		8			-		-
Other currency		210		189			-		-

Other provisions, current		959		511			-		-
Chilean peso		30		28			-		-
Other currency		929		483			-		-

Tax liabilities, current		-		(204	)		174		2,501
Argentine peso		-		-			174		2,501
Brazilian real		-		(3	)		-		-
Chilean peso		-		(25	)		-		-
Other currency		-		(176	)		-		-

	Up to 90 days				91 days to 1 year
	As of		As of		As of		As of
	December 31,		December 31,		December 31,		December 31,
Current liabilities	2017		2016		2017		2016
	ThUS$		ThUS$		ThUS$		ThUS$

Other non-financial liabilities, current		25,190		33,439		-		-
Argentine peso		393		13,463		-		-
Brazilian real		542		430		-		-
Chilean peso		11,283		14,999		-		-
Colombian peso		837		578		-		-
Euro		5,954		168		-		-
U.S. dollar		3,160		684		-		-
Other currency		3,021		3,117		-		-

Total current liabilities		982,282		906,290		149,063		473,684
Argentine peso		122,845		34,301		8,810		3,408
Brazilian real		29,352		41,167		669		27
Chilean peso		266,603		131,688		90,343		120,265
Colombian peso		3,801		9,627		855		578
Euro		64,035		23,613		9,165		5
U.S. dollar		427,002		606,336		37,304		348,038
Other currency		68,644		59,558		1,917		1,363

	More than 1 to 3 years				More than 3 to 5 years				More than 5 years
	As of		As of		As of		As of		As of		As of
	December 31,		December 31,		December 31,		December 31,		December 31,		December 31,
Non-current liabilities	2017		2016		2017		2016		2017		2016
	ThUS$		ThUS$		ThUS$		ThUS$		ThUS$		ThUS$

Other financial liabilities, non-current		276,436		178,793		263,798		747,218		189,500		41,785
Chilean peso		41,548		59,177		189,500		16,189		189,500		-
U.S. dollar		234,888		119,616		74,298		731,029		-		41,785

Accounts payable, non-current		362,964		195,629		-		-		-		-
Chilean peso		13,251		10,474		-		-		-		-
U.S. dollar		348,329		183,904		-		-		-		-
Other currency		1,384		1,251		-		-		-		-

Other provisions, non-current		41,514		39,513		-		-		-		-
Argentine peso		940		635		-		-		-		-
Brazillian real		24,074		23,541		-		-		-		-
Chilean peso		-		38		-		-		-		-
Colombian peso		551		569		-		-		-		-
Euro		9,883		8,664		-		-		-		-
U.S. dollar		6,066		6,066		-		-		-		-

Provisions for employees benefits, non-current		77,579		68,774		-		-		-		-
Brazilian real		-		28		-		-		-		-
Chilean peso		73,399		68,380		-		-		-		-
U.S. dollar		4,180		366		-		-		-		-

Other non-financial liabilities, non-current		-		3		-		-		-		-
Colombian peso		-		3		-		-		-		-

Total non-current liabilities		758,493		482,712		263,798		747,218		189,500		41,785
Argentine peso		940		635		-		-		-		-
Brazilian real		24,074		23,569		-		-		-		-
Chilean peso		128,198		138,069		189,500		16,189		189,500		-
Colombian peso		551		572		-		-		-		-
Euro		9,883		8,664		-		-		-		-
U.S. dollar		593,463		309,952		74,298		731,029		-		41,785
Other currency		1,384		1,251		-		-		-		-

	As of			As of
	December 31,			December 31,
General summary of foreign currency:	2017			2016
	ThUS$			ThUS$

Total assets		850,777			659,041
Argentine peso		75,368			76,832
Brazilian real		70,084			72,532
Chilean peso		235,938			137,233
Colombian peso		3,791			13,390
Euro		70,786			32,420
U.S. dollar		181,706			229,222
Other currency		213,104			97,412

Total liabilities		2,343,136			2,651,689
Argentine peso		132,595			38,344
Brazilian real		54,095			64,763
Chilean peso		864,144			406,211
Colombian peso		5,207			10,777
Euro		83,083			32,282
U.S. dollar		1,132,067			2,037,140
Other currency		71,945			62,172

Net position
Argentine peso		(57,227	)		38,488
Brazilian real		15,989			7,769
Chilean peso		(628,206	)		(268,978	)
Colombian peso		(1,416	)		2,613
Euro		(12,297	)		138
U.S. dollar		(950,361	)		(1,807,918	)
Other currency		141,159			35,240

(b)	Exchange differences

Exchange differences recognized in income, except for financial instruments measured at fair value through profit or loss, for the period ended December 31, 2017, 2016 and 2015, generated a charge of ThUS $ 18,718, a credit of ThUS $ 121,651 and a charge of ThUS $ 467,896, respectively.

Exchange differences recognized in equity as reserves for exchange differences for conversion, for the period ended December 31, 2017, 2016 and 2015, generated a charge of ThUS $ 47,495, a credit of ThUS $ 494,362 and a charge of ThUS $1, 409,439, respectively.

The following shows the current exchange rates for the U.S. dollar, on the dates indicated:

	As of December 31,
	2017		2016		2015		2014

Argentine peso		18.57		15.84		12.97		8.55
Brazilian real		3.31		3.25		3.98		2.66
Chilean peso		614.75		669.47		710.16		606.75
Colombian peso		2,984.77		3,000.25		3,183.00		2,389.50
Euro		0.83		0.95		0.92		0.82
Strong bolivar		3,345.00		673.76		198.70		12.00
Australian dollar		1.28		1.38		1.37		1.22
Boliviano		6.86		6.86		6.85		6.86
Mexican peso		19.66		20.63		17.34		14.74
New Zealand dollar		1.41		1.44		1.46		1.28
Peruvian Sol		3.24		3.35		3.41		2.99
Uruguayan peso		28.74		29.28		29.88		24.25