6-K 1 ccufs2016_6k.htm FORM 6-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 6-K

Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934

COMPAÑÍA CERVECERIAS UNIDAS S.A.
(Exact name of Registrant as specified in its charter)
UNITED BREWERIES COMPANY, INC.
(Translation of Registrant’s name into English)

Republic of Chile
(Jurisdiction of incorporation or organization)
Vitacura 2670, 23 rd floor, Santiago, Chile
(Address of principal executive offices)
_________________________________________

Securities registered or to be registered pursuant to section 12(b) of the Act.

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F X Form 40-F ___

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes ___ No X

COMPAÑÍA CERVECERÍAS UNIDAS S.A. AND SUBSIDIARIES CONSOLIDATED FINANCIAL STATEMENTS (Figures expressed in thousands of Chilean pesos) As of and for the year ended December 31, 2016

INDEX
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (ASSETS) | 5
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (LIABILITIES AND EQUITY) | 6
CONSOLIDATED STATEMENT OF INCOME | 7
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | 8
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | 9
CONSOLIDATED STATEMENT OF CASH FLOW | 10
NOTE 1 GENERAL INFORMATION | 11
NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 19
2.1 | Basis of preparation | 19
2.2 | Basis of consolidation | 20
2.3 | Financial information as per operating segments | 20
2.4 | Foreign currency and unidad de fomento (Adjustment unit) | 21
2.5 | Cash and cash equivalents | 22
2.6 | Other financial assets | 22
2.7 | Financial instruments | 22
2.8 | Financial asset impairment | 24
2.9 | Inventories | 24
2.10 | Biological current assets | 25
2.11 | Other non-financial assets | 25
2.12 | Property, plant and equipment | 25
2.13 | Leases | 26
2.14 | Investment property | 26
2.15 | Intangible assets other than goodwill | 26
2.16 | Goodwill | 27
2.17 | Impairment of non-financial assets other than goodwill | 27
2.18 | Assets of a disposal group held for sale | 28
2.19 | Income taxes | 28
2.20 | Employees benefits | 28
2.21 | Provisions | 29
2.22 | Revenue recognition | 29
2.23 | Commercial agreements with distributors and supermarket chains | 29
2.24 | Cost of sales of products | 30
2.25 | Other expenses by function | 30
2.26 | Distribution expenses | 30
2.27 | Administration expenses | 30
2.28 | Environment liabilities | 30
NOTE 3 ESTIMATES AND APPLICATION OF PROFESSIONAL JUDGMENT | 30
NOTE 4 ACCOUNTING CHANGES | 31
NOTE 5 RISK ADMINISTRATION | 31
NOTE 6 FINANCIAL INSTRUMENTS | 37
NOTE 7 FINANCIAL INFORMATION AS PER OPERATING SEGMENTS | 43

NOTE 8 BUSINESS COMBINATIONS | 53
NOTE 9 NATURE OF COST AND EXPENSE | 54
NOTE 10 FINANCIAL RESULTS | 54
NOTE 11 OTHER INCOME BY FUNCTION | 54
NOTE 12 OTHER GAINS (LOSSES) | 55
NOTE 13 CASH AND CASH EQUIVALENTS | 55
NOTE 14 ACCOUNTS RECEIVABLES - TRADE AND OTHER RECEIVABLES | 62
NOTE 15 ACCOUNTS AND TRANSACTIONS WITH RELATED COMPANIES | 65
NOTE 16 INVENTORIES | 70
NOTE 17 BIOLOGICAL CURRENT ASSETS | 71
NOTE 18 OTHER NON-FINANCIAL ASSETS | 72
NOTE 19 INVESTMENT ACCOUNTED FOR BY THE EQUITY METHOD | 72
NOTE 20 INTANGIBLE ASSETS OTHER THAN GOODWILL | 76
NOTE 21 GOODWILL | 78
NOTE 22 PROPERTY, PLANT AND EQUIPMENT | 80
NOTE 23 INVESTMENT PROPERTY | 82
NOTE 24 ASSETS OF DISPOSAL GROUP HELD FOR SALE | 83
NOTE 25 INCOME TAXES | 84
NOTE 26 OTHER FINANCIAL LIABILITIES | 87
NOTE 27 ACCOUNTS PAYABLE - TRADE AND OTHER PAYABLES | 103
NOTE 28 PROVISIONS | 103
NOTE 29 OTHER NON-FINANCIAL LIABILITIES | 104
NOTE 30 EMPLOYEE BENEFITS | 104
NOTE 31 NON-CONTROLLING INTERESTS | 108
NOTE 32 COMMON SHAREHOLDERS' EQUITY | 109
NOTE 33 EFFECTS OF CHANGES IN CURRENCY EXCHANGE RATE | 113
NOTE 34 CONTINGENCIES AND COMMITMENTS | 117
NOTE 35 ENVIRONMENT | 120
NOTE 36 SUBSEQUENT EVENTS | 123

Compañía Cervecerías Unidas S.A. and subsidiaries Consolidated Statement of Financial Position (Assets) (Figures expressed in thousands of Chilean pesos) |

# CONSOLIDATED STATEMENT OF FINANCIAL POSITION

ASSETS | Notes | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
Current assets |  |  |
Cash and cash equivalent | 13 | 133,789,950 | 192,554,239
Other financial assets | 6 | 8,406,491 | 13,644,105
Other non-financial assets | 18 | 15,859,137 | 17,654,373
Accounts receivable-trade and other receivables | 14 | 280,766,784 | 252,225,937
Accounts receivable from related companies | 15 | 3,523,825 | 4,788,930
Inventories | 16 | 199,290,678 | 174,227,415
Biological assets | 17 | 7,948,379 | 7,633,340
Taxes receivables | 25 | 29,423,479 | 15,264,220
Total current assets different from assets of disposal group held for sale |  | 679,008,723 | 677,992,559
Assets of disposal group held for sale | 24 | 2,377,887 | 6,319,316
Total assets of disposal group held for sale |  | 2,377,887 | 6,319,316
Total current assets |  | 681,386,610 | 684,311,875
Non-current assets |  |  |
Other financial assets | 6 | 203,784 | 80,217
Other non-financial assets | 18 | 5,369,211 | 5,220,954
Accounts receivable non-current | 14 | 3,563,797 | -
Accounts receivable from related companies | 15 | 356,665 | 445,938
Investment accounted by equity method | 19 | 64,404,946 | 49,995,263
Intangible assets other than goodwill | 20 | 77,678,850 | 71,868,007
Goodwill | 21 | 96,663,023 | 99,490,372
Property, plant and equipment (net) | 22 | 903,831,702 | 872,667,210
Investment property | 23 | 6,253,827 | 6,838,002
Deferred tax assets | 25 | 31,864,635 | 34,529,593
Total non-current assets |  | 1,190,190,440 | 1,141,135,556
Total Assets | 1,871,577,050 | 1,825,447,431

F-5

The accompanying notes 1 to 36 are an integral part of these consolidated financial statements.

Compañía Cervecerías Unidas S.A. and subsidiaries Consolidated Statement of Financial Position (Liabilities and Equity) (Figures expressed in thousands of Chilean pesos) |

# CONSOLIDATED STATEMENT OF FINANCIAL POSITION

LIABILITIES AND EQUITY | Notes | As of December 31, 2016 | As of December 31, 2015
LIABILITIES | ThCh$ | ThCh$
Current liabilities |  |  |
Other financial liabilities | 26 | 66,679,933 | 43,973,991
Accounts payable-trade and other payables | 27 | 259,677,852 | 227,736,803
Accounts payable- to related companies | 15 | 9,530,071 | 11,624,218
Other short-term provisions | 28 | 409,164 | 503,440
Tax liabilities | 25 | 11,806,434 | 12,198,024
Employee benefits provisions | 30 | 22,838,228 | 21,712,059
Other non-financial liabilities | 29 | 71,369,972 | 70,942,144
Total current liabilities |  | 442,311,654 | 388,690,679
Non-current liabilities |  |  |
Other financial liabilities | 26 | 117,944,033 | 136,926,545
Others accounts payable | 27 | 1,082,898 | 1,645,098
Other long-term provisions | 28 | 1,323,520 | 1,476,518
Deferred tax liabilities | 25 | 86,789,951 | 90,237,843
Employee benefits provisions | 30 | 21,832,415 | 18,948,603
Total non-current liabilities |  | 228,972,817 | 249,234,607
Total liabilities |  | 671,284,471 | 637,925,286
EQUITY
Equity attributable to equity holders of the parent | 32 |  |
Paid-in capital |  | 562,693,346 | 562,693,346
Other reserves |  | (142,973,378) | (103,226,416)
Retained earnings |  | 657,578,187 | 598,349,442
Total equity attributable to equity holders of the parent |  | 1,077,298,155 | 1,057,816,372
Non-controlling interests | 31 | 122,994,424 | 129,705,773
Total Shareholders' Equity | 1,200,292,579 | 1,187,522,145
Total Liabilities and Shareholders' Equity | 1,871,577,050 | 1,825,447,431

F-6

The accompanying notes 1 to 36 are an integral part of these consolidated financial statements.

Compañía Cervecerías Unidas S.A. and subsidiaries Consolidated Statement of Income (Figures expressed in thousands of Chilean pesos) |

# CONSOLIDATED STATEMENT OF INCOME

CONSOLIDATED STATEMENT OF INCOME | Notes | For the years ended December 31.
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Net sales | 7 | 1,558,897,708 | 1,498,371,715 | 1,297,966,299
Cost of sales | 9 | (741,819,916) | (685,075,251) | (604,536,815)
Gross margin |  | 817,077,792 | 813,296,464 | 693,429,484
Other income by function | 11 | 5,144,154 | 6,577,244 | 25,463,716
Distribution costs | 9 | (270,835,822) | (277,599,722) | (240,848,630)
Administrative expenses | 9 | (155,322,295) | (128,135,799) | (110,014,716)
Other expenses by function | 9 | (195,412,109) | (209,201,189) | (188,109,562)
Other gains (losses) | 12 | (8,345,907) | 8,512,000 | 4,036,939
Income from operational activities |  | 192,305,813 | 213,448,998 | 183,957,231
Financial Income | 10 | 5,680,068 | 7,845,743 | 12,136,591
Financial costs | 10 | (20,307,238) | (23,101,329) | (22,957,482)
Share of net loss of joint ventures and associates accounted for using the equity method | 19 | (5,560,522) | (5,228,135) | (898,607)
Foreign currency exchange differences | 10 | 456,995 | 957,565 | (613,181)
Result as per adjustment units | 10 | (2,246,846) | (3,282,736) | (4,159,131)
Income before taxes |  | 170,328,270 | 190,640,106 | 167,465,421
Income taxes | 25 | (30,246,383) | (50,114,516) | (46,673,500)
Net income of year |  | 140,081,887 | 140,525,590 | 120,791,921
Net income attibutable to: |  |  |  |
Equity holders of the parent |  | 118,457,488 | 120,808,135 | 106,238,450
Non-controlling interests | 31 | 21,624,399 | 19,717,455 | 14,553,471
Net income of year |  | 140,081,887 | 140,525,590 | 120,791,921
Net income per share (Chilean pesos) from: |  |  |  |
Continuing operations |  | 320.59 | 326.95 | 287.52
Diluted earnings per share (Chilean pesos) from: |  |  |  |
Continuing operations |  | 320.59 | 326.95 | 287.52

F-7

The accompanying notes 1 to 36 are an integral part of these consolidated financial statements.

Compañía Cervecerías Unidas S.A. and subsidiaries Consolidated Statement of Comprehensive Income (Figures expressed in thousands of Chilean pesos) |

# CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | Notes | For the years ended December 31.
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Net income of year |  | 140,081,887 | 140,525,590 | 120,791,921
Other income and expenses charged or credited againts equity |  |  |  |
Cash flow hedges (1) | 32 | 84,962 | 80,693 | (155,258)
Exchange differences of foreign subsidiaries (1) | 32 | (27,280,176) | (29,678,944) | (4,629,683)
Gains (losses) from defined plans | 32 | (2,355,384) | (939,433) | (1,884,054)
Income tax related with cash flow hedge (1) | 32 | (20,648) | (17,563) | 39,470
Income tax relating to defined benefit plans | 32 | 659,198 | 314,541 | 501,689
Total other comprehensive income and expense |  | (28,912,048) | (30,240,706) | (6,127,836)
Comprehensive income and expense |  | 111,169,839 | 110,284,884 | 114,664,085
Comprehensive income originated by: |  |  |  |
Equity holders of the parent (2) |  | 91,752,250 | 92,606,720 | 97,067,296
Non-controlling interests |  | 19,417,589 | 17,678,164 | 17,596,789
Comprehensive income and expense |  | 111,169,839 | 110,284,884 | 114,664,085

(1) These items will be reclassified to Consolidated Statement of Income when they are settled.

(2) Corresponds to the income for the year where no income or expenses have been recorded directly against shareholder´s equity.

F-8

The accompanying notes 1 to 36 are an integral part of these consolidated financial statements.

Compañía Cervecerías Unidas S.A. and subsidiaries Consolidated Statement of Changes in Equity (Figures expressed in thousands of Chilean pesos) |

# CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

STATEMENT OF CHANGES IN EQUITY | Paid in capital | Other reserves | Retained earnings | Equity attributable to equity holders of the parent | Non-controlling interests | Total Shareholders' Equity
Common Stock | Currency translation difference | Hedge reserves | Actuarial gains and losses on defined benefit plans reserves | Other reserves
ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Balanced as of January 1, 2014 | 562,693,346 | (60,084,197) | 65,109 | (348,673) | (5,514,048) | 491,864,319 | 988,675,856 | 95,568,422 | 1,084,244,278
Changes |  |  |  |  |  |  |  |  |
Interim dividends (1) | - | - | - | - | - | (23,278,681) | (23,278,681) | - | (23,278,681)
Interim dividends according to policy (2) | - | - | - | - | - | (36,500,001) | (36,500,001) | - | (36,500,001)
Other increase (decrease) in Equity (3) | - | - | - | - | 2,419 | (378,712) | (376,293) | (8,594,222) | (8,970,515)
Effects business combination | - | - | - | - | - | - | - | 18,340,752 | 18,340,752
Comprehensive income and expense | - | (7,698,661) | (108,479) | (1,364,014) | - | 106,238,450 | 97,067,296 | 17,596,789 | 114,664,085
Total changes in equity | - | (7,698,661) | (108,479) | (1,364,014) | 2,419 | 46,081,056 | 36,912,321 | 27,343,319 | 64,255,640
AS OF DECEMBER 31, 2014 | 562,693,346 | (67,782,858) | (43,370) | (1,712,687) | (5,511,629) | 537,945,375 | 1,025,588,177 | 122,911,741 | 1,148,499,918
Balanced as of January 1, 2015 | 562,693,346 | (67,782,858) | (43,370) | (1,712,687) | (5,511,629) | 537,945,375 | 1,025,588,177 | 122,911,741 | 1,148,499,918
Changes |  |  |  |  |  |  |  |  |
Interim dividends (1) | - | - | - | - | - | (24,387,190) | (24,387,190) | - | (24,387,190)
Interim dividends according to policy (2) | - | - | - | - | - | (36,016,878) | (36,016,878) | - | (36,016,878)
Other increase (decrease) in Equity (3) | - | - | - | - | 25,543 | - | 25,543 | (10,884,132) | (10,858,589)
Comprehensive income and expense | - | (27,652,528) | 40,844 | (589,731) | - | 120,808,135 | 92,606,720 | 17,678,164 | 110,284,884
Total changes in equity | - | (27,652,528) | 40,844 | (589,731) | 25,543 | 60,404,067 | 32,228,195 | 6,794,032 | 39,022,227
AS OF DECEMBER 31, 2015 | 562,693,346 | (95,435,386) | (2,526) | (2,302,418) | (5,486,086) | 598,349,442 | 1,057,816,372 | 129,705,773 | 1,187,522,145
Balanced as of January 1, 2016 | 562,693,346 | (95,435,386) | (2,526) | (2,302,418) | (5,486,086) | 598,349,442 | 1,057,816,372 | 129,705,773 | 1,187,522,145
Changes |  |  |  |  |  |  |  |  |
Interim dividends (1) | - | - | - | - | - | (24,387,190) | (24,387,190) | - | (24,387,190)
Interim dividends according to policy (2) | - | - | - | - | - | (34,841,553) | (34,841,553) | - | (34,841,553)
Other increase (decrease) in Equity (3) | - | - | - | - | - | - | - | (14,413,649) | (14,413,649)
Comprehensive income and expense | - | (25,123,546) | 41,607 | (1,623,299) | - | 118,457,488 | 91,752,250 | 19,417,589 | 111,169,839
Increase (decrease) through changes in ownership interests in subsidaries (4) | - | - | - | - | (13,041,724) | - | (13,041,724) | (11,715,289) | (24,757,013)
Total changes in equity | - | (25,123,546) | 41,607 | (1,623,299) | (13,041,724) | 59,228,745 | 19,481,783 | (6,711,349) | 12,770,434
AS OF DECEMBER 31, 2016 | 562,693,346 | (120,558,932) | 39,081 | (3,925,717) | (18,527,810) | 657,578,187 | 1,077,298,155 | 122,994,424 | 1,200,292,579

(1) Related to declared dividends at December 31 of each year and paid during January of the following year, as agreed by the Board of Directors.

(2) Corresponds to the differences between CCU’s policy to distribute a minimum dividend of at least 50% of the income (Note 32) based on the local statutory reported to SVS and the interim dividends declared at December 31 of each year.

(3) Mainly related to dividends to Non-controlling interest.

(4) In 2016, the Company, through its subsidiaries Aguas CCU-Nestlé Chile S.A. and Embotelladoras Chilenas Unidas S.A., acquired additional interests in Manantial S.A. for an amount of ThCh$ 19,111,686, with a carrying value to ThCh$ 3,816,220, resulting in a decrease to Other reserves of ThCh$ 7,801,153 (see Note 1 (1)). Additionally, during 2016 the Company, through its subsidiary Compañía Industrial Cervecera S.A. acquired additional interests in Los Huemules SRL. for an amount of ThCh$ 118,092, with a carrying value to ThCh$ 312,103, resulting in an increase to Other reserves of ThCh$ 194,000 (see Note 1 (4)). Finally during 2016, joint venture Foods acquired additional interest in Alimentos Nutrabien S.A. for an amount of ThCH$ 14,352,706, with a carrying value to ThCh$ 3,497,385, resulting in a decrease of ThCh$ 5,426,209.

F-9

The accompanying notes 1 to 36 are an integral part of these consolidated financial statements.

Compañía Cervecerías Unidas S.A. and subsidiaries Consolidated Statement of Cash Flow (Figures expressed in thousands of Chilean pesos) |

# CONSOLIDATED STATEMENT OF CASH FLOW

CONSOLIDATED STATEMENT OF CASH FLOW | Notes | For the years ended as of December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Cash flows from (used in) operational activities |  |  |  |
Collection classes: |  |  |  |
Proceeds from goods sold and services rendered |  | 1,862,763,071 | 1,770,338,769 | 1,584,494,230
Other proceeds from operating activities |  | 23,086,788 | 20,467,143 | 30,247,374
Types of payments: |  |  |  |
Payments of operating activities |  | (1,216,451,995) | (1,120,571,275) | (1,051,616,618)
Payments of salaries |  | (201,389,122) | (178,915,580) | (171,898,347)
Other payments for operating activities |  | (228,011,323) | (220,365,087) | (162,644,788)
Dividends received |  | 34,380 | 45,492 | 75,169
Interest paid |  | (16,958,068) | (19,813,502) | (20,757,207)
Interest received |  | 5,635,697 | 6,476,628 | 10,763,936
Income tax reimbursed (paid) |  | (47,055,951) | (44,584,176) | (44,208,661)
Other cash movements | 12 | 8,360,871 | 6,432,460 | (833,425)
Net cash flows from operational activities |  | 190,014,348 | 219,510,872 | 173,621,663
Cash flows from (used in) investing activities |  |  |  |
Cash flows used for control of subsidaries or other businesses | 13 | (641,489) | - | (8,369)
Cash flows used in the purchase of non-controlling interests | 13 | (2,174,370) | (1,921,245) | (13,776,885)
Collections from related entities |  | - | 6,709,845 | -
Other collections on the sale of interests in joint ventures | 24 | 512,596 | - | -
Other payments to acquire interests in joint ventures | 13 | (27,043,481) | (42,163,032) | (1,445,478)
Proceeds from sale of property, plan and equipment |  | 2,753,539 | 2,776,474 | 2,587,448
Acquisition of property, plant and equipment |  | (125,691,740) | (129,668,910) | (227,863,039)
Purchases of intangibles assets |  | (3,191,685) | (2,062,012) | (2,217,113)
Other cash movements |  | 469,240 | 518,711 | 3,753,297
Net cash flows used in investing activities |  | (155,007,390) | (165,810,169) | (238,970,139)
Cash flows from (used in) financing activities |  |  |  |
Payments for changes in ownership interests in subsidaries | 13 | (19,111,686) | - | -
Proceeds from long-term loans |  | 3,804,384 | 19,570,689 | 15,482,763
Porceeds from short-term loans |  | 19,345,325 | 23,358,700 | 21,882,842
Total amount from loans |  | 23,149,709 | 42,929,389 | 37,365,605
Loan payments |  | (25,295,124) | (54,797,023) | (20,766,024)
Payments of finance lease liabilities |  | (1,530,851) | (1,697,649) | (1,745,210)
Payments of loan from related entities |  | (750,000) | (601,494) | (223,225)
Dividends paid |  | (69,819,729) | (66,147,145) | (65,315,914)
Other cash movements |  | (1,945,457) | (2,525,569) | (81,470,807)
Net cash flows used in financing activities |  | (95,303,138) | (82,839,491) | (132,155,575)
Net decrease in cash equivalents, before the effect of changes in exchange rate | (60,296,180) | (29,138,788) | (197,504,051)
Effects of changes in exchange rates on cash and cash equivalents |  | 1,531,891 | 6,918,151 | 3,425,660
Cash and cash equivalents, beginning of the year |  | 192,554,239 | 214,774,876 | 408,853,267
Cash and cash equivalents, final of the year | 13 | 133,789,950 | 192,554,239 | 214,774,876

F-10

The accompanying notes 1 to 36 are an integral part of these consolidated financial statements.

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 1 General Information

Compañía Cervecerías Unidas S.A. (CCU, or the Company or the Parent Company) was incorporated in Chile as an open stock company, and it is registered in the Securities Record of the Superintendencia de Valores y Seguros de Chile (Local Superintendence of Equity Securities, SVS) under Nº 0007, consequently, the Company is subject to Regulation by the SVS. The Company’s shares are quoted in Chile on the Santiago Stock Exchange, Electronic Stock Exchange and Valparaíso Stock Exchange. The Company is also registered with the United States of America Securities and Exchange Commission (SEC) and it quotes its American Depositary Shares (ADS) on the New York Stock Exchange (NYSE). There was an a mendment to the Deposit Agreement dated December 3, 2012, between the Company, JP Morgan Chase Bank, NA and all holders of ADRs. According to this Amendment, there was an ADS ratio change from 1 ADS to 5 common shares to a new ratio of 1 ADS to 2 common shares. There was no change to CCU's underlying ordinary shares. This action was effective on December 20, 2012.

CCU is a diversified beverage company, with operations mainly in Chile, Argentina, Uruguay, Paraguay, Colombia and Bolivia. CCU is the largest Chilean brewery, the second largest brewery in Argentina, the second largest producer of soft drinks in Chile, the second-largest wine producer in Chile, the largest bottler of mineral water and nectar in Chile and one of the largest pisco producer in Chile. It also participates in the business of Home and Office Delivery (“HOD”), in a business of home delivery of purified water in bottles through the use of dispensers, and in the rum and candy in Chile. It participates in the industry of the ciders, spirits and wines in Argentina and also participates in the industry of mineral water and soft drinks and beer distribution in Uruguay, Paraguay, Colombia and Bolivia.

In Chile and abroad, CCU and its subsidiaries are the owners of a wide range of brands, under which market our products. In the domestic market, its portfolio of brands in the beer category consists among others of Cristal, Cristal Light, Cristal Cero 0°, Cristal Cero Radler, Escudo, Kunstmann, Austral, D´olbek, Royal Guard, Morenita, Dorada, Szot, Guayacán and Stones of Lemon, Maracuyá and Apple varieties. It holds exclusive license to produce and market Heineken, Sol and Coors. In Chile, the Company is the exclusive distributor of Tecate and Blue Moon beer.

In Argentina, CCU produces beers in its plants located in the cities of Salta, Santa Fé and Luján. Its main brands are Schneider, Imperial, Palermo, Bieckert, Santa Fé, Salta, Córdoba and are the holders of exclusive license for the production and marketing of Budweiser, Heineken, Amstel and Sol. CCU also imports Kunstmann beer. Additionally, exports beer to different countries in the region mainly under the Schneider and Heineken brands. In Argentina, CCU is the exclusive distributor of the energy drink Red Bull. Besides, participates in the cider business, controlling of Saenz Briones, marketing Sidra Real, La Victoria and “1888”, brands leaders in the market. Also participates in the spirits business, which its marketed under El Abuelo brand, as well as import other liquors from Chile.

In Uruguay, the Company participates in the mineral waters and soft drinks business with Native and Nix brand, flavoured waters with the Native brand, soft drinks with the Nix and nectars with Watt´s brand. In addition, it sells beers imported under Heineken, Schneider and Kuntsmann brand and cider Sidra Real.

In Paraguay, the Company participates in the non-alcoholic and alcoholic business. Its portfolio of non-alcoholic brands consists of Pulp, Watt's, Puro Sol, La Fuente and Zuma. These brands include own, licensed and imported. The Company in the beer business is owner of Sajonia brand and imports Heineken, Coors Light, Coors 1873, Schneider, Paulaner and Kunstmann, brands.

In Colombia, through its joint venture with Central Cervecera de Colombia S.A.S. (“CCC”), CCU participates in the business of beers and malts since November 2014. Its portfolio of beers includes licensed and imported Heineken, Amstel, Murphys and Buckler brands. Its has of exclusive license for the importation, distribution and production of Heineken. Since October 2015, it holds exclusive license to produce and market Coors and Coors Light. Subsequently, from April and July of 2016, were incorporated Tecate and Sol brands, respectively, with a license contract to produce and market these brands.

In Bolivia, through its associate Bebidas Bolivianas BBO S.A., the Company participates in the non-alcoholic and alcoholic business since May 2014. Its portfolio of non-alcoholic brands consist of Mendocina, Free cola, Sinalco, Real and Natur-all. These brands include own and licensed. The alcoholic brands consist of Real, Capital and Cordillera. It has of exclusive license for the importation and distribution of Heineken and the energy drink Monster.

Within the non-alcoholic, in Chile Operating segment, CCU has the Bilz, Pap, Kem, Kem Xtreme, Nobis, Cachantun, Más, Mas Woman and Porvenir brands. Regarding the HOD category, CCU has the Manantial brand. The Company, directly or through its subsidiaries, has license agreements with Pepsi, 7up, Mirinda, Gatorade, Adrenaline Red, Life Water, Lipton Ice Tea, Ocean Spray, Crush, Canada Dry Limón Soda, Canada Dry Ginger Ale, Canada Dry Agua Tónica, Nestlé Pure Life, Watt´s and Frugo. In Chile, CCU is the exclusive distributor of the energy drink Red Bull and Perrier water. Besides, through a joint operation also owns the Sprim and Fructus and the licencse Vivo and Caricia brands.

F-11

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

In the spirits, in Chile Operating segment, in the category of pisco, CCU owns the brand Mistral, Campanario, Horcón Quemado, Control C, Tres Erres, La Serena and Ruta cocktail, and their respective extensions. In rum category Company owns the brands Sierra Morena and their extensions and Cabo Viejo. The Company has the Fehrenberg brand and is exclusive distributor in Chile of Pernod Ricard’s products.

In the Wine Operating segment, through its subsidiary Viña San Pedro Tarapacá S.A. (“VSPT”), produces wines and sparkling, which are sold in the domestic and overseas markets exporting to more than 80 countries. Its main brands of Viña San Pedro are Altaïr, Cabo de Hornos, Sideral, 1865, Castillo de Molina, Épica, 35 Sur, GatoNegro, Gato, Manquehuito and San Pedro Exportación. The brands´s portfolio of Viña Tarapacá includes: Gran Reserva Etiqueta Azul, Gran Reserva Etiqueta Negra, Gran Reserva Etiqueta Blanca, Gran Tarapacá, León de Tarapacá and Tarapacá Varietal. The brands´s portfolio of Viña Santa Helena includes: Parras Viejas, Selección del Directorio, Siglo de Oro, Santa Helena Varietal, Alpaca, Gran Vino and Santa Helena. VSPT also participates in Chile and international market with vines Misiones de Rengo, Viña Mar, Casa Rivas, Leyda and Finca La Celia and Tamari in Argentina.

At the end of year 2015, the joint venture in Foods Compañía de Alimentos CCU S.A. ("Foods"), who participates in the business of snacks and food in Chile, sold Calaf and Natur brands to Empresas Carozzi S.A. In addition Foods holds the brand Nutra Bien.

F-12

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The detail of the described licenses appears below:

Main brands under license
Licenses | Validity Date
Amstel in Argentina (1) | July 2022
Amstel in Colombia (2) | March 2028
Austral in Chile (3) | July 2018
Blue Moon in Chile (4) | December 2021
Buckler in Colombia (2) | March 2028
Budweiser in Argentina | December 2025
Coors in Paraguay | Negotiating the terms of a new contract
Coors in Chile (5) | December 2025
Coors in Argentina (6) | December 2019
Coors in Colombia (6) | December 2020
Crush, Canada Dry (Ginger Ale, Agua Tónica and Limón Soda) in Chile (7) | December 2018
Gatorade in Chile (8) | December 2018
Heineken in Bolivia (9) | December 2024
Heineken in Paraguay (9) | November 2022
Heineken in Uruguay (9) | 10 years renewables
Heineken in Chile and Argentina (10) | 10 years renewables
Heineken in Colombia (11) | March 2028
Murphys in Colombia (2) | March 2028
Nestlé Pure Life in Chile (7) | December 2017
Paulaner in Paraguay | April 2019
Pepsi, Seven Up and Mirinda in Chile | December 2043
Red Bull in Argentina | December 2017
Red Bull in Chile (12) | Indefinitely
Schneider in Paraguay | November 2017
Sol in Argentina (10) | 10 years renewables
Sol in Chile (10) | 10 years renewables
Sol in Colombia (2) | March 2028
Té Lipton in Chile | March 2020
Tecate in Colombia | March 2028
Watt's (nectars, fruit-based drinks and other) rigid packaging, except carton in Chile | Indefinitely
Watt's in Paraguay (6) | May 2019

(1) After the initial termination date, license is automatically renewed under the same conditions (Rolling Contract), each year for a period of 10 years, unless notice of non-renewal is given.

(2) Renewable for periods of two years, subject to the compliance of the contract conditions.

(3) If Renewal criteria have been satisfied, renewable through December, 2025, thereafter shall automatically renew every year for a new term of 5 years (Rolling Contract).

(4) After the initial termination date, license is automatically renewed under the same conditions (Rolling Contract), each year for a period of 5 years, subject to the compliance of the contract conditions.

(5) License renewable for one period of 5 years, subject to the compliance of the contract conditions.

(6) License renewable for periods of 5 years, subject to the compliance of the contract conditions.

(7) Renewable for an additional period equal to the duration of the Shareholders Agreement of Bebidas CCU-PepsiCo SpA., subject to the compliance of the contract conditions.

(8) License for 10 years, automatically renewable for periods of 5 years, unless notice of non-renewal.

(9) License for 10 years, automatically renewable on the same terms (Rolling Contract), each year for a period of 10 years, unless notice of non-renewal is given.

(10) After the initial termination date, License is automatically renewable each year for a period of 5 years (Rolling Contract), unless notice of non-renewal is given.

(11) Indefinite contract, notice of termination 6 months in advance. The earliest possible effective date of termination is October 31, 2018.

(12) Indefinite contract, subject to the compliance of the contract conditions.

The Company’s address and main office is located in Santiago, Chile, at Avenida Vitacura Nº 2670, Las Condes district and its tax identification number (Rut) is 90,413,000-1.

F-13

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

As of December 31, 2016 the Company had a total of 8,186 employees according to the following detail:

| Number of employes
| Parent company | Consolidated
Senior Executives | 10 | 16
Managers and Deputy Managers | 79 | 400
Other employees | 276 | 7,770
Total | 365 | 8,186

Compañía Cervecerías Unidas S.A. is under the control of Inversiones y Rentas S.A. (IRSA), which is the direct and indirect owner of 60% of the Company shares. IRSA is currently a joint venture between Quiñenco S.A. and Heineken Chile Limitada, a company controlled by Heineken Americas B.V, each with a 50% equity participation.

The consolidated financial statements include the following direct and indirect significant subsidiaries where the percentage of participation represents the economic interests at the consolidated level:

Subsidiary | Tax ID | Country of origin | Functional currency | Share percentage direct and indirect
As of December 31, 2016 | As of December 31, 2015
Direct | Indirect | Total | Total
Cervecera CCU Chile Limitada | 96,989,120-4 | Chile | Chilean Pesos | 99.7500 | 0.2499 | 99.9999 | 99.9999
Embotelladora Chilenas Unidas S.A. (3) | 99,501,760-1 | Chile | Chilean Pesos | 99.0670 | 0.9164 | 99.9834 | 99.9338
Cía. Cervecerías Unidas Argentina S.A. (4) | 0-E | Argentina | Argentine pesos | - | 99.9923 | 99.9923 | 99.9923
Viña San Pedro Tarapacá S.A. (*) | 91,041,000-8 | Chile | Chilean Pesos | - | 64.6980 | 64.6980 | 64.6980
Compañía Pisquera de Chile S.A. | 99,586,280-8 | Chile | Chilean Pesos | 46.0000 | 34.0000 | 80.0000 | 80.0000
Transportes CCU Limitada | 79,862,750-3 | Chile | Chilean Pesos | 98.0000 | 2.0000 | 100.0000 | 100.0000
CCU Investments Limited | 0-E | Cayman Islands | Chilean Pesos | 99.9999 | 0.0001 | 100.0000 | 100.0000
Inversiones INVEX CCU DOS Limitada | 76,126,311-0 | Chile | Chilean Pesos | 99.8516 | 0.1484 | 100.0000 | 99.9999
CRECCU S.A. | 76,041,227-9 | Chile | Chilean Pesos | 99.9602 | 0.0398 | 100.0000 | 100.0000
Fábrica de Envases Plásticos S.A. | 86,150,200-7 | Chile | Chilean Pesos | 90.9100 | 9.0866 | 99.9966 | 99.9966
Southern Breweries Limited (5) | 0-E | Cayman Islands | Chilean Pesos | 61.2146 | 38.7804 | 99.9950 | 99.9553
Comercial CCU S.A. | 99,554,560-8 | Chile | Chilean Pesos | 50.0000 | 49.9866 | 99.9866 | 99.9866
CCU Inversiones S.A. | 76,593,550-4 | Chile | Chilean Pesos | 98.8398 | 1.1339 | 99.9737 | 99.9732
Millahue S.A. | 91,022,000-4 | Chile | Chilean Pesos | 99.9621 | - | 99.9621 | 99.9621
Aguas CCU-Nestlé Chile S.A. (1) | 76,007,212-5 | Chile | Chilean Pesos | - | 50.0669 | 50.0669 | 50.0669
CCU Inversiones II Limitada (2) | 76,349,531-0 | Chile | Chilean Pesos | 98.6709 | 1.3290 | 99.9999 | 99.9946
Compañía Cervecera Kunstmann S.A. | 96,981,310-6 | Chile | Chilean Pesos | 50.0007 | - | 50.0007 | 50.0007
Inversiones INVEX TRES Limitada | 76,248,389-0 | Chile | Chilean Pesos | 99.0000 | 0.9884 | 99.9884 | 99.9884
Milotur S.A. | 0-E | Uruguay | Uruguayan pesos | 100.0000 | - | 100.0000 | 100.0000
Coralina S.A. | 0-E | Uruguay | Uruguayan pesos | 100.0000 | - | 100.0000 | 100.0000
Marzurel S.A. | 0-E | Uruguay | Uruguayan pesos | 100.0000 | - | 100.0000 | 100.0000
Bebidas del Paraguay S.A. (2) | 0-E | Paraguay | Paraguayan guarani | 50.0050 | - | 50.0050 | 50.0050
Distribuidora del Paraguay S.A. (2) | 0-E | Paraguay | Paraguayan guarani | 49.9590 | - | 49.9590 | 49.9590
Los Huemules S.R.L. | 0-E | Argentina | Argentine pesos | - | 75.4931 | 75.4931 | 26.9680
Bebidas Ecusa SpA. (3) | 76,517,798-7 | Chile | Chilean Pesos | - | 99.9338 | 99.9338 | 99.9338

(*)Public Company.

F-14

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

In addition to the table presented above, below are the percentages of participation with voting rights, in each of the subsidiaries as of December 31, 2016 and December 31, 2015, respectively. Each shareholder has one vote per share which he owns or represents. The percentage of participation with voting rights represents the sum of the direct participation and indirect participation via subsidiary.

Subsidiary | Tax ID | Country of origin | Functional currency | Share percentage with voting rights
As of December 31, 2016 | As of December 31, 2015
% | %
Cervecera CCU Chile Limitada | 96,989,120-4 | Chile | Chilean Pesos | 100.0000 | 100.0000
Embotelladora Chilenas Unidas S.A. (3) | 99,501,760-1 | Chile | Chilean Pesos | 99.9834 | 99.9338
Cía. Cervecerías Unidas Argentina S.A. (4) | 0-E | Argentina | Argentine pesos | 100.0000 | 100.0000
Viña San Pedro Tarapacá S.A. | 91,041,000-8 | Chile | Chilean Pesos | 64.6980 | 64.6980
Compañía Pisquera de Chile S.A. | 99,586,280-8 | Chile | Chilean Pesos | 80.0000 | 80.0000
Transportes CCU Limitada | 79,862,750-3 | Chile | Chilean Pesos | 100.0000 | 100.0000
CCU Investments Limited | 0-E | Cayman Islands | Chilean Pesos | 100.0000 | 100.0000
Inversiones INVEX CCU DOS Limitada | 76,126,311-0 | Chile | Chilean Pesos | 100.0000 | 100.0000
CRECCU S.A. | 76,041,227-9 | Chile | Chilean Pesos | 100.0000 | 100.0000
Fábrica de Envases Plásticos S.A. | 86,150,200-7 | Chile | Chilean Pesos | 100.0000 | 100.0000
Southern Breweries Limited (5) | 0-E | Cayman Islands | Chilean Pesos | 100.0000 | 100.0000
Comercial CCU S.A. | 99,554,560-8 | Chile | Chilean Pesos | 100.0000 | 100.0000
CCU Inversiones S.A. | 76,593,550-4 | Chile | Chilean Pesos | 99.9737 | 99.9737
Millahue S.A. | 91,022,000-4 | Chile | Chilean Pesos | 99.9621 | 99.9621
Aguas CCU-Nestlé Chile S.A. (1) | 76,007,212-5 | Chile | Chilean Pesos | 50.1000 | 50.1000
CCU Inversiones II Limitada (2) | 76,349,531-0 | Chile | Chilean Pesos | 100.0000 | 100.0000
Compañía Cervecera Kunstmann S.A. | 96,981,310-6 | Chile | Chilean Pesos | 50.0007 | 50.0007
Inversiones INVEX TRES Limitada | 76,248,389-0 | Chile | Chilean Pesos | 100.0000 | 100.0000
Milotur S.A. | 0-E | Uruguay | Uruguayan pesos | 100.0000 | 100.0000
Coralina S.A. | 0-E | Uruguay | Uruguayan pesos | 100.0000 | 100.0000
Marzurel S.A. | 0-E | Uruguay | Uruguayan pesos | 100.0000 | 100.0000
Bebidas del Paraguay S.A. (2) | 0-E | Paraguay | Paraguayan guarani | 50.0050 | 50.0050
Distribuidora del Paraguay S.A. (2) | 0-E | Paraguay | Paraguayan guarani | 49.9590 | 49.9590
Los Huemules S.R.L. | 0-E | Argentina | Argentine pesos | 100.0000 | 24.9680
Bebidas Ecusa SpA. (3) | 76,517,798-7 | Chile | Chilean Pesos | 99.9338 | 99.9338

The main movements in the ownership of the subsidiaries included in these consolidated financial statements are the following:

(1) Aguas CCU-Nestlé Chile S.A.

On January 29, 2016 the subsidiaries Aguas CCU-Nestlé Chile S.A. (“Aguas”) and Embotelladoras Chilenas Unidas S.A. (“ECUSA”) have acquired 48.07% and 0.92% of the shares of Manantial S.A. (“Manantial”) respectively, exercising the call option granted in the Shareholders’ Agreement of Manantial. As a consequence, Compañía Cervecerías Unidas S.A. is currently the indirect owner of 100% of the shares of Manantial, remaining as the only direct shareholders of Manantial: (i) Aguas with 99.08% of the capital stock, and (ii) ECUSA with 0.92% of the capital stock. The total amount of this transaction was ThCh$ 19,111,686.

F-15

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

(2) CCU Inversiones II Limitada

On December 23, 2013, the Company acquired 50.005% and 49.959% of the stock of Bebidas del Paraguay S.A. and Distribuidora del Paraguay S.A., respectively. This transaction allows the Company, participates in the beer distribution business, and production and marketing of non-alcoholic drinks, waters and nectars. The total amount of this transaction was ThCh$ 11,254,656. Subsequently, on June 9, 2015, the Company paid a committed capital of ThCh$ 7,414,290 and this transaction does not change the percentage of participation.

Bebidas del Paraguay S.A. (BdP) and Distribuidora del Paraguay S.A. (DdP) are considered as an economic group that share operational and financial strategy. BdP manufactures products with different brands of its property. DdP is sole and exclusive customer, which is responsible for the distribution and marketing of its products, reason why BdP is it consolidates DdP, and accordingly is presented in the consolidated financial statements of CCU.

As explained in Note 8, on March 31, 2016, through its subsidiary Bebidas del Paraguay S.A., acquired 51% of the stock rights of paraguayan company Artisan SRL. The amount of this transaction was ThCh$ 641,489 (equivalents to US$ 1,000,000). At the date of issuance of these consolidated financial statements the fair value is still preliminary and that the Company is not expecting that the final fair value to be significantly different.

Addittionaly, as explained in Note 19, the Company participates of 50% of shares of Central Cervecera de Colombia S.A.S.

(3) Embotelladoras Chilenas Unidas S.A.

On November 16, 2015, formed a new company called Bebidas ECUSA SpA., where the subsidiary Embotelladoras Chilenas Unidas S.A. has the 100% of shares. The purpose of this company is the distribution, transport, import, export and marketing in general, on all types of soft drinks.

As explained in Note 1 (1) before mentioned, on January 29, 2016, Embotelladoras Chilenas Unidas S.A. acquired 0.92% of the stock rights of Manantial S.A.

(4) Compañía Cervecerías Unidas Argentina S.A.

On January 7, 2016, throgh the argentinian subsidiary Compañía Industrial Cervecera S.A. (CICSA), the Company acquired 50.99% of the stock rights of Los Huemules SRL, after Mr. Juan Javier Negri declared its commitment character of CICSA and notified such situation to Los Huemules SRL. As a consequence of the above mentioned the shareholders of Los Huemules SRL. are Compañía Cervecera Kunstmann S.A. and CICSA with 49.01% and 50.99%, respectively. The final amount of this transaction was ThCh$ 118,092.

(5) Southern Breweries Limited

On August 26, 2016, the subsidiaries Saint Joseph Investments Limited and South Investments Limited was merged in CCU Cayman Limited, latter being the continuing legal entity.

Besides, on October 2016, Southern Breweries Establishment, subsidiary of CCU in Liechtenstein, changed its named to "Southern Breweries Aktiengesellschaft" and on October 18, 2016 re-domiciling it to Cayman Islands. Subsequently, on November 2016, was modified the statutes of such subsidiary and changed its name by the "Southern Breweries Limited". Finally, starting December 1, 2016, the subsidiary CCU Cayman Limited before mentioned was merged in Southern Breweries Limited, latter being the continuing legal entity. Transactions mentioned above had no significant effects on the results of the Company.

F-16

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Below we briefly describe the companies that qualify as joint operations:

(a) Promarca S.A.

Promarca S.A. is a closed stock company with its main activity being the acquisition, development and administration of trademarks and their corresponding licenses to their operators.

On December 31, 2016, Promarca S.A. recorded a profit of ThCh$ 4,812,696 (ThCh$ 4,708,318 in 2015 and ThCh$ 4,646,620 in 2014), which in accordance with the Company´s policies is 100% distributable.

At the Extraordinary Shareholders´ Meetings of Promarca S.A. held on June 2016, agreed to increase the Paid-in capital (jointly the "Capital Increase"). The Capital Increase was subscribed by the subsidiary New Ecusa S.A. and Watt´s Dos S.A.in equal parts, and who maintained its current 50% of the stock rights, through the Paid-in capital of ThCh$ 8,199,240 and 100% of stock rights of the company the Promarca Internacional SpA. (which its main activity are the exploitation and development of Watt´s brands in Argentina, Paraguay, Uruguay and Bolivia). From June 2016, Promarca Internacional SpA., it became a subsidiary in a 100% of Promarca S.A. During June 30, 2016, for this joint operation has determined the following fair values of assets and liabilities:

Assets and Liabilities | Fair Value
ThCh$
Intangible assets other than goodwill | 11,229,149
Total non-current assets | 11,229,149
Total Assets | 11,229,149
Deferred tax liabilities | 3,029,909
Total current liabilities | 3,029,909
Net identifiable assets acquired | 8,199,240
Amount paid | 8,199,240

As a result of the fair values determined previously and in according to rights on the joint operation, have been generated intangibles for an amount of ThCh$ 5,614,575 described in Note 20.

(b) Compañía Pisquera Bauzá S.A.

On December 2, 2011, the subsidiary Compañía Pisquera de Chile S.A. (CPCh) signed a license agreement for the commercialization and distribution of the pisco brand Bauzá in Chile. In addition, this transaction included the acquisition by CPCh of 49% of Compañía Pisquera Bauzá S.A. (CPB), owner of the brand Bauzá in Chile. The family Bauzá owns 51% of that company and all of its productive assets, thereby continuing the link to the production of pisco Bauzá maintaining its quality, origin and premium character.

On December 31, 2015, CPB recorded a profit of ThCh$ 82,663 (ThCh$ 109,207 in 2014), which in accordance with the Company´s policies is 100% distributable.

On January 7, 2016, CPCh sold its interest of 49% to Agroproductos Bauzá S.A. (agroproductos Bauzá). At the end of December 31, 2015 this joint operation was classified to Assets of disposal group held for sale (see Note 24).

(c) Bebidas CCU-Pepsico SpA.

On October 23, 2013, Bebidas CCU-PepsiCo SpA (BCP) was incorporated, which is qualifies as an joint operation, where the subsidiary Embotelladoras Chilenas Unidas S.A. has the 50% of participation. The capital of this entity amounts to ThCh$ 1,000. The purpose of this company is the manufacture, production, processing, transformation, transport, import, export, purchase, sale and in general comercialization of all type of concentrates. Its operations commenced on January 1, 2014.

On December 31, 2016, BCP recorded a profit of ThCh$ 1,066,005 (ThCh$ 802,418 in 2015 and ThCh$ 789,648 in 2014), which in accordance with the Company´s policies is 100% distributable.

F-17

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

(d) Bebidas Carozzi CCU SpA.

On November 26, 2015, the Company, through its subsidiary ECCUSA, entered into a joint arrangement that qualifies as a joint operation, in the company called Bebidas Carozzi CCU SpA. (BCCCU) where CCU and Empresas Carozzi S.A. participate as only shareholders in equal parts. The purpose of this company is the production, marketing and distribution of instant beverage powder in the national territory. The total disbursement by ECCUSA in this transaction was an amount of ThCh$ 21,846,500. Its operations commenced on December 1, 2015. During year 2016 for this joint operation has determined the following fair values of assets and liabilities:

Assets and Liabilities | Fair Value
ThCh$
Cash and cash equivalent | 1
Total current assets | 1
Intangible assets other than goodwill | 15,495,163
Total non-current assets | 15,495,163
Total Assets | 15,495,164
Deferred tax liabilities | 4,181,760
Total current liabilities | 4,181,760
Net identifiable assets | 11,313,404
Non-controlling interests | (5,656,702)
Goodwill | 16,189,798
Amount paid | 21,846,500

As a result of the fair values determined previously and in according to rights on the joint operation, have been generated intangibles and goodwill for an amount of ThCh$ 7,747,581 and ThCh$ 16,189,798, respectively (see Note 20 and 21).

As of December 31, 2015, the Company was in the process of assessing of the fair values of acquisitions above mentioned, so it was recorded under Other non-financial non-current assets for an amount of ThCh$ 21,846,500, however f or comparison purposes of this Consolidated Financial Statements, the Company have been reclassified from Other non-financial non-current assets to Intangibles, Goodwill and Deferred taxes as is shown below:

Non-current assets | Balances presented at 12.31.2015 | Reclassification | Balances 31.12.2015
ThCh$ | ThCh$ | ThCh$
Other non-financial assets |  | 27,067,454 | (21,846,500) | 5,220,954
Intangible assets other than goodwill |  | 64,120,426 | 7,747,581 | 71,868,007
Goodwill |  | 83,300,573 | 16,189,799 | 99,490,372
Non-current liabilities | Balances presented at 12.31.2015 | Reclassification | Balances 31.12.2015
ThCh$ | ThCh$ | ThCh$
Deferred tax liabilities |  | 88,146,963 | 2,090,880 | 90,237,843

On December 31, 2016, BCCCU recorded a profit of ThCh$ 797,268 (ThCh$ 402,228 in 2015), which in accordance with the Company´s policies is 100% distributable.

F-18

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The companies mentioned above (letter a) to d)) meet the conditions stipulated in IFRS 11 to be considered "joint operations", as the primary assets in both entities are trademarks, the contractual arrangements establishes that the parties to the joint arrangement share all interests in the assets relating to the arrangement in a specified proportion and their income is 100% royalty charged to the joint operators from the sale of products using these trademarks.

# Note 2 Summary of significant accounting policies

Significant accounting policies adopted for the preparation of these consolidated financial statements are described below:

### 2.1 Basis of preparation

The accompanying consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS), issued by the International Accounting Standard Board (IASB), which have been applied uniformly to the periods presented.

The consolidated financial statements cover the following periods: Statement of Financial Position as of December 31, 2016, 2015 and 2014, Statement of changes in Equity, Statement of Income, Statement of Comprehensive Income and Statement of Cash Flow for the years ended December 31, 2016, 2015 y 2014.

The amounts shown in the attached financial statements are expressed in thousands of Chilean pesos, which is the Company’s functional currency. All amounts have been rounded to thousand pesos, except when otherwise indicated.

The consolidated financial statements have been prepared on the historical basis, as modified by the subsequent valuation of financial assets and financial liabilities (including derivative instruments) at fair value through profit and loss.

The preparation of the consolidated financial statements in accordance with IFRS requires the use of certain critical accounting estimates. It also requires that management uses its professional judgment in the process of applying the Company’s accounting policies. See Note 3 for disclosure of significant accounting estimates and judgments.

All IFRS standards, amendments and enhancements whose adoption was required by January 1, 2016, have been adopted by the Company, without significant impacts in the financial statements as of December 31, 2016.

At the date of issuance of these consolidated financial statements the following Standars, Amendments, Improvements and Interpretations to existing IFRS standards have been published. These standards are required to be applied as following:

New Standards, Amendments, Improvements and Interpretations | Mandatory for years beginning in:
Amendments to IAS 7 | Disclosure Initiative. | January, 1, 2017
Amendments to IAS 12 | Recognition of Deferred Tax Assets for Unrealised Losses. | January, 1, 2017
Improvement to IFRS 12 | Disclosure of Interest in Other Entities. | January, 1, 2017
Amendments to IFRS 2 | Classification and Measurement of Share-based Payment Transactions. | January, 1, 2018
IFRIC Interpretation 22 | Foreign Currency Transactions and Advance Consideration. | January, 1, 2018
Amendments to IAS 40 | Transfers of Investment Property. | January, 1, 2018
Improvement to IAS 28 | Investment in Associates and Joint Ventures: Measuring an associate or joint venture at fair value. | January, 1, 2018
IFRS 9 | Financial Instruments. | January, 1, 2018
IFRS 15 | Revenue fro Contracts with Customers. | January, 1, 2018
IFRS 15 | Clarifications to IFRS 15 Revenue fro Contracts with Customers. | January, 1, 2018
IFRS 16 | Leases. | January, 1, 2019

As of December 31, 2016, the company is in the process of evaluating the impact of adopting the IFRS 9, IFRS 15 and IFRS 16. These standards will not be early adopted. For the rest of the standards mentioned in the table above, the Company does not expect a material impact on the consolidated financial statements upon initial application.

F-19

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

### 2.2 Basis of consolidation

Subsidiaries

Subsidiaries are the entities over which the Company is empowered to direct financial and operational policies, which is generally the result of ownership of over half the voting rights. Subsidiaries are consolidated as from the date on which control was obtained by the Company, and they are excluded from consolidation as of the date the Company loses such control.

The acquisition method is used for the accounting of acquisition of subsidiaries. The acquisition cost is the fair value of the assets delivered, of the equity instruments issued and of the liabilities incurred or assumed as of the exchange date. The identifiable assets acquired, as well as the identifiable liabilities and contingencies assumed in a business combination are initially valued at their fair value on the acquisition date, independently from the scope of minority interests. Goodwill is initially measured as the excess of the aggregate of the consideration transferred and the fair value of non-controlling interest over the net identifiable assets acquired and liabilities assumed. If this consideration is lower than the fair value of the net assets of the subsidiary acquired, the difference is recognized as income.

Joint operations

As explained in Note 1, in those joint arrangements that qualify as joint operations, the Company recognises the assets, liabilities, gains (losses) from operational activities respect of its interest in the joint operations in accordance with IFRS 11.

Intercompany transaction

Intercompany transactions, balances and unrealized gains from transactions between the Group’s entities are eliminated during consolidation. Unrealized losses are also eliminated, unless the transaction provides evidence of an impairment of the asset transferred. Whenever necessary, the subsidiaries accounting policies are amended to ensure uniformity with the policies adopted by the Company.

Non-controlling Interest

The non-controlling interest is presented in the Equity section of the Statement of Financial Position. The net income attributable to equity holder of the parent and the non-controlling interest are each disclosed separately in the Consolidated Statement of Income after net income.

Investments accounted by the equity method

Joint ventures and associates

The Company maintains investments in joint arrangements that qualify as joint ventures, which correspond to a contractual agreement by which two or more parties carry out an economic activity that is subject to joint control, and normally involves the establishment of a separate entity in which each party has a share based on a shareholders’ agreement. In addition the Company maintains investments in associates which are defined as those entities that investor has significant influence and is not a subsidiary or is a joint venture.

The Company accounts for its participation in joint arrangement that qualify as joint ventures and associates using the equity method. The financial statements of the joint ventures are prepared for the same year, under accounting policies consistent with those of the Company. Adjustments are made to conform any difference in accounting policies that may exist to the Company´s accounting policies.

Whenever the Company contributes or sells assets to the companies under joint control or associate, any part of the income or loss originated by the transaction is recognized based on how the asset is realized. Whenever the Company purchases assets of such companies, it does not recognize its share in the income or loss of the joint venture as regards to such transaction until the asset is sold or realized by the joint venture.

###

F-20

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

### 2.3 Financial information as per operating segments

The Company has defined three operating segments which are essentially defined with respect to its revenues in the geographic areas of commercial activity: 1.- Chile, 2.- International business and 3.- Wine.

These operating segments mentioned are consistent with the way the Company is managed and how results will be reported by CCU. These segments reflect separate operating results which are regularly reviewed by chief operating decision maker in order to make decisions about the resources to be allocated to the segment and assess its performance (See Note 7).

The segments performance is measured according to several indicators, of which OR (Adjust Operating Result), OR before Exceptional Items (EI), ORBDA (Adjust Operating Result Before Depreciation and Amortization), ORBDA before EI, ORBDA margin (ORBDA’s % of total revenues for the operating segment), the volumes and Net sales. Sales between segments are conducted using terms and conditions at current market rates.

The Company defined the Adjusted Operating Result as the Net incomes (losses) before Other gains (losses), Net financial cost, Equity and income from joint ventures and associates, Foreign currency exchange differences, Results as per adjustment units and Income tax, and the ORBDA, for the Company purposes, is defined as Adjusted Operating Result before Depreciation and Amortization.

MSD&A, included Marketing, Selling, Distribution and Administrative expenses.

Exceptional Items are income or expenses that do not occur regularly as part of the normal activities of the Company. It’s presented separately because its important items for the understanding the normal operations of the Company due to importance or nature.

OR before exceptional items (EI) and ORBDA before EI are defined as OR plus exceptional items and ORBDA plus exceptional items, respectively.

Corporate revenues and expenses are presented separately within the other.
2.4 Foreign currency and unidad de fomento (Adjustment unit)

Presentation and functional currency

The Company uses the Chilean peso ($ or CLP) as its functional currency and for the presentation of its financial statements. The functional currency has been determined considering the economic environment in which the Company carries out its operations and the currency in which the main cash flows are generated. The functional currency of the Argentine, Uruguayan and Paraguayan subsidiaries is the Argentine peso, Uruguayan peso and Paraguayan guarani, respectively. The functional currency of the joint venture an associates in Colombia and Bolivia are Colombian peso and Boliviano, respectively.

Transactions and balances

Transactions in foreign currencies and adjustment units (“Unidad de Fomento” or “UF”) are initially recorded at the exchange rate of the corresponding currency or adjustment unit as of the date on which the transaction occurs. The Unidad de Fomento (UF) is a Chilean inflation-indexed peso-denominated monetary unit. The UF rate is set daily in advance based on changes in the previous month’s inflation rate. At the close of each Consolidated Statement of Financial Position, the monetary assets and liabilities denominated in foreign currencies and adjustment units are translated into Chilean pesos at the exchange rate of the corresponding currency or adjustment unit. The exchange difference arising, both from the liquidation of foreign currency transactions, as well as from the valuation of foreign currency monetary assets and liabilities, is included in statement of income, in Foreign currency exchange differences, while the difference arising from the changes in adjustment units are recorded in the statement of income as Result as per adjustment units.

For consolidation purposes, the assets and liabilities of the subsidiaries whose functional currency is different from the Chilean peso are translated into Chilean pesos by using the exchange rates valid as of the date of the consolidated financial statements, and the exchange differences originated by the translation of the assets and liabilities are recorded in Equity Reserve, under the Currency Translation Reserves item. The income and expense are translated at the monthly average exchange rate for the corresponding terms as differences since there have not been significant fluctuations in the exchange rates during each month.

F-21

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The exchange rates of the primary foreign currencies and adjustment units used in the preparation of the consolidated financial statements as of December 31, 2016, 2015 y 2014 are as follows:

Chilean Pesos as per unit of foreign currency or adjustable unit | As of December 31, 2016 | As of December 31, 2015 | As of December 31, 2014
Ch$ | Ch$ | Ch$
Foreign currencies |  |  |  |
US Dollar | USD | 669.47 | 710.16 | 606.75
Euro | EUR | 705.60 | 774.61 | 738.05
Argentine Peso | ARG | 42.13 | 54.46 | 70.96
Uruguayan Peso | UYU | 22.82 | 23.71 | 24.90
Sterling Pound | GBP | 826.10 | 1,053.02 | 944.21
Paraguayan guarani | PYG | 0.12 | 0.12 | 0.13
Bolivians | BS | 97.59 | 103.67 | 88.45
Colombian Peso | COP | 0.22 | 0.22 | 0.25
Adjustment Units |  |  |  |
Unidad de fomento* | UF | 26,347.98 | 25,629.09 | 24,627.10

* The Unidad de Fomento (UF) is a Chilean inflation-indexed, peso-denominated monetary unit. The UF rate is set daily in advance based on changes in the previous month´s inflation rate.

### 2.5 Cash and cash equivalents

Cash and cash equivalents includes cash available, bank balances, time deposits at financial entities, investments in mutual funds and financial instruments acquired under re-sale agreements, as well as short-term investments with a high liquidity, all at a fixed interest rate, normally with an original maturity of up to three months.

### 2.6 Other financial assets

Other financial assets include market securities, derivatives contracts and time deposits at financial entities with a maturity over 90 days.

### 2.7 Financial instruments

Financial assets

The Company recognizes a financial asset in its Consolidated Statement of Financial Position according to the following:

As of the date of the initial recognition, Management classifies its financial assets (i) at fair value through profit and loss and (ii) collectible credits and accounts, depending on the purpose for which the financial assets were acquired. For those instruments not classified at fair value through income, any cost attributable to the transaction is recognized as part of the asset value.

The fair value of the instruments that are actively quoted in formal markets is determined by the quoted price as of the financial statement closing date. For those investments without an active market, the fair value is determined using valuation technique including (i) the use of recent market transactions, (ii) references to the current market value of another financial instrument of similar characteristics, (iii) discounted cash flow and (iv) other valuation models.

After the initial recognition the Company values the financial assets as described below:

Accounts receivable

Trade receivable credits or accounts are recognized according to their invoice value.

F-22

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The Company acquires loan insurances covering approximately 90% and 99% of the individually significant accounts receivable balances, for the domestic market and the international market, respectively, of the total of accounts receivable, net of a 10% deductible.

An impairment of accounts receivable balances is recorded when there is an objective evidence that the Company not will be capable to collect amounts according to the original terms. Some indicators that an account receivable has impairment are the financial problems, initiation of a bankruptcy, financial restructuring and age of the balances of our customers.

Estimated losses from bad debts are determined by applying different percentages, taking into account maturity factors, until reaching 100% of the balance in most of the debts older than 180 days, with the exception of those cases that in accordance with current policies, losses are estimated due to partial deterioration based on a case by case analysis.

Current trade receivable credits and accounts are initially recognized at their nominal value and are not discounted because they do not differ significantly from their fair value. The Company has determined that the calculation of the amortized cost is not materially different from the invoiced amount because the transactions do not have significant associated costs.

Financial liabilities

The Company recognizes a financial liability in its Consolidated Statement of Financial Position according to the following:

Debts and financial liabilities that accrue interests

Loans and financial obligations accruing interest are initially recognized at the fair value of the resources obtained, less costs incurred directly attributable to the transaction. After initial recognition, loans and obligations accruing interest are measured at their amortized cost. The difference between the net amount received and the value to be paid is recognized in the Consolidated Statement of Income during the term of the loan, using the effective interest rate method.

Interest paid and accrued related to debts and obligations used in a financing operations appear under financial cost.

Loans and obligations accruing interest with a maturity within twelve month period are classified as current liabilities, unless the Company has the unconditional right to defer the payment of the obligation for at least a twelve month period after the financial statement closing date.

Trade accounts payable and other payables

Accounts payable and other accounts payable are initially recognized at their nominal value because they do not differ significantly from fair value. The Company has determined that no significant differences exist between the carrying value and amortized cost using the effective interest method.

Derivative Instruments

All derivative financial instruments are initially recognized at fair value as of the date of the derivative contract and subsequently re-measured at their fair value. Gains and losses resulting from fair value measurement are recorded in the Statement of Income as gains or losses due to fair value of financial instruments, unless the derivative instrument is designated as a hedging instrument.

The Financial Instruments at fair value through profit and loss include financial assets classified as held for trading and financial assets which have been designated as such by the Company. Financial assets are classified as held for trading when acquired with the purpose of selling them within a short term. The fair value of derivative financial instruments that do not qualify for hedge accounting are immediately recognized in the consolidated statement of income under Other gains (losses) . The fair value of these derivatives are recorded under Other financial assets y Other financial liabilities.

Derivative instruments are classified as held for trading unless they are classified as hedge instruments.

Derivative instruments classified as hedges are accounted for as cash flow hedges.

In order to classify a derivative as a hedging instrument for accounting purposes, the Company documents (i) as of the transaction date or at designation time, the relationship or correlation between the hedging instrument and the hedged item, as well as the risk management purposes and strategies, (ii) the assessment, both at designation date as well as on a continuing basis, whether the derivative instrument used in the hedging is highly transaction effective to offset changes in inception cash flows of the hedged item. A hedge is considered effective when changes in the cash flows of the underlying directly attributable to the risk hedged are offset with the changes in fair value, or in the cash flows of the hedging instrument with effectiveness between 80% to 125%.

F-23

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The total fair value of hedging derivatives are classified as assets or financial liabilities in Other non-current if the maturity of the hedged item is more than 12 months and as other assets or current liabilities if the remaining maturity of the hedged item is less than 12 months. The ineffective portion of these instruments can be viewed in Other gains (losses) of the Consolidated Statements of Income. The effective portion of the change in the fair value of derivative instruments that are designated and qualified as cash flow hedges are initially recognized in Cash Flow Hedge Reserve in a separate component of Equity. The income or loss related to the ineffective portion is immediately recognized in the Statement of Income. The amounts accumulated in Equity are reclassified in Income during the same period in which the corresponding hedged item is reflected in the Statement of Income. When a cash flow hedge ceases to comply with the hedge accounting criteria, any accumulated income or loss existing in Equity remains in Equity and is recognized when the expected transaction is finally recognized in the Statement of Income. When it is estimated that an expected transaction will not occur, the accumulated gain or loss recorded in Equity is immediately recognized in the Statement of Income.

Deposits for returns of bottles and containers

Deposits for returns of bottles and containers corresponds to the liabilities registered by the guarantees of money received from customers for bottles and containers placed at their disposal and represents the value that will be returned to the customer when it returns the bottles to the Company in good condition along with the original invoice. This value is determined by the estimation of the bottles and containers in circulation that are expected to be returned to the Company in the course of time based on the historic experience, physical counts held by clients and independent studies over the quantities that are in the hands of end consumers, valued at the average weighted guarantees for each type of bottles and containers.

The Company does not intend to make significant repayment of these deposits within the next 12 months. Such amounts are classified within current liabilities, under the line Other financial liabilities, since the Company does not have the legal ability to defer this payment for a period exceeding 12 months. This liability is not discounted, since it is considered a payable on demand, with the original invoice and the return of the respective bottles and containers and it does not have adjustability or interest clauses of any kind in its origin.

### 2.8 Financial asset impairment

At each financial statement date the Company assesses if a financial asset or financial group of assets is impaired.

The Company assesses impairment of accounts receivable collectively by grouping the financial assets according to similar risk characteristics, which indicate the debtor’s capacity to comply with their obligations under the agreed upon conditions. When there is objective evidence that a loss due to impairment has been incurred in the accounts receivable, the loss amount is recognized in the Consolidated Statement of Income, as Administrative expenses.

In the event that during subsequent periods the impairment loss amount decreases and such decrease may be objectively related to an event occurring after impairment recognition, the impairment loss previously recognized is reversed.

Any subsequent impairment reversal is recognized in Income provided that the book value of the asset does not exceed its value as of the date the impairment was recognized.

### 2.9 Inventories

Inventories are stated at the lower of cost acquisition or production cost and net realizable value. The production cost of finished products and of products under processing includes raw material, direct labor, indirect manufacturing expenses based on a normal operational capacity and other costs incurred to place the products at the locations and in the conditions necessary for sale, net of discounts attributable to inventories.

The net realizable value is the estimated sale price in the normal course of business, less marketing and distribution expenses. When market conditions cause the production cost to be higher than its net realizable value, an allowance for assets deterioration is registered for the difference in value. This allowance for inventory deterioration also includes amounts related to obsolete items due to low turnover, technical obsolescence and products withdrawn from the market.

F-24

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The inventories and cost of products sold, is determined using the Weighted Average Cost (WAC). The Company estimates that most of the inventories have a high turnover.

The materials and raw materials purchased from third parties are valued at their acquisition cost; once used, they are incorporated in finished products using the WAC methodology.

### 2.10 Biological current assets

Under the Biological current assets, the Company includes the costs associated with agricultural activities (grapes), which are capitalized up to the harvest date, at which time they become part of inventory cost for subsequents processes. The Company considers that the costs associated with agricultural activities represent a reasonable approximation to fair value.

### 2.11 Other non-financial assets

Other non-financial assets mainly includes advance payments associated with advertising related to contracts regarding the making of commercials which are work in progress and have not yet been shown (current and non-current), payments to insurances and advances to suppliers in relation with certain purchases of property, plant and equipment. Additionally it includes disbursements related to tax payments to be recovered from subsidiaries in Argentina, guarantees paid related with leases and materials to be consumed related to industrial security tools.

### 2.12 Property, plant and equipment

Property, plant and equipment are recorded at their historic cost, less accumulated depreciation and impairment losses. The cost includes both the disbursements directly attributable to the asset acquisition or construction, as well as the financing interest directly related to certain qualified assets, which are capitalized during the construction or acquisition period, as long as these assets qualify for these purposes considering the period necessary to complete and prepare the assets to be operative. Disbursements after the purchase or acquisition are only capitalized when it is likely that the future economic benefits associated to the investment flow towards the Company, and costs may be reasonably measured. Subsequent disbursements related to repairs and maintenance are recorded as expense when incurred.

Property, plant and equipment depreciation, including the assets under financial lease, is calculated on a straight line basis over the estimated useful life of the fixed assets, taking into account their estimated residual value. When an asset is formed by significant components with different useful lives, each part is separately depreciated. Property, plant and equipment useful lives and residual values estimates are reviewed and adjusted at each financial statement closing date, if necessary.

Property, plant and equipment estimated useful lives are as follows:

Type of Assets | Number of years
Land | Indefinite
Buildings and Constructions | 20 to 60
Machinery and equipment | 10 to 25
Fumiture and accesories | 5 to 10
Other equipment (coolers and mayolicas) | 5 to 8
Glass containers, and plastic containers | 3 to 12
Vines in production | 30

Gains and losses resulting from the sale of properties, plants and equipment are calculated comparing their book values against the related sales proceeds and are included in the Consolidated Statement of Income.

F-25

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Biological assets held by Viña San Pedro Tarapacá S.A. (VSPT) and its subsidiaries consist of vines under formation and under production. The harvested grapes are used for the later production of wines.

Vines under production are valued at the historic cost, less depreciation and any impairment loss.

Depreciation of under production vines is recorded on a straight-line basis based on the 30-years average estimated production useful life, which is periodically assessed. Vines under formation are not depreciated until they start production.

Costs incurred in acquiring and planting new vines are capitalized.

When the book value of an asset of property, plant and equipment exceeds its recoverable amount, this is reduced immediately to its recoverable amount (See Note 2, 2.17).

During year 2015, the Company has early adopted the amendment of IAS 16 and 41, therefore vines under formation and under production are recorded in Properties, plant and equipment.

### 2.13 Leases

Lease agreements are classified as financial leases when the agreement transfers to the Company substantially all the risks and rewards inherent to the asset ownership, according to International Accounting Standard No. 17 “Leases”. For those agreements that qualify as financial leases, at the initial date an asset and a liability are recognized at a value equivalent to the lower of the fair value of the asset and the present value of future lease payments. Subsequently, lease payments are allocated between the financial expense and the obligation reduction, so that a constant interest rate on the obligation balance is obtained.

Lease agreements that do not qualify as financial leases are classified as operating leases. Lease payments of operating leases are charged to income on a straight line basis over the life of the lease.

### 2.14 Investment property

Investment property consists of land and building held by the Company with the purpose of generating appreciation and are not used in the normal course of business, and are recorded at historic cost less impairment loss, if any. Investment property depreciation is calculated on a straight line basis over the estimated useful life of such property, taking into account the estimated residual value of such property.

### 2.15 Intangible assets other than goodwill

Commercial Trademarks

The Company’s commercial trademarks correspond to intangible assets with an indefinite useful life that are presented at their historic cost, less any impairment loss. The Company believes that through marketing investments trademarks maintain their value, consequently they are considered as having an indefinite useful life and they are not amortizable. Such assets are subject to impairment tests on a yearly basis, or when factors exist indicating a likely loss of value (Note 2, 2.17).

Software Program

Software Program licenses acquired are capitalized at the value of the costs incurred for their acquisition and preparation for the use of the specific programs. Such costs are amortized over their estimated useful lives (4 to 7 years). The maintenance costs of the software programs are recognized as expense in the year during which they are incurred.

Water Rights

Water Rights acquired by the Company correspond to the existing exploitation rights of water from natural sources, and they are recorded at their attributed cost as of the transition date to IFRS. Given that such rights are perpetual they are not amortizable, nevertheless they are annually subject to impairment assessment, or when factors exist that indicate a likely loss of value (See Note 2, 2.17).

F-26

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Distribution Rights

Corresponds to rights acquired to distribute different products. These rights are amortised over their estimated useful lives.

Research and development

Research and development expenses are recognized in the period incurred.

### 2.16 Goodwill

Goodwill represents the excess of the consideration transferred the amount of any non-controlling interes in the acquiree and the acquisition date fair vale of any previous equity interest in the acquiree over the fair value of the net idetificable assets acquiree, and is accounted for at its cost value less accumulated impairment losses. Goodwill related to joint venture acquisitions is included in the investment accounting value.

For the purposes of impairment tests, goodwill is assigned Cash Generating Units (CGU) that are expected to benefit from the synergies of a business combination. Each unit or group of units (CGU - See Note 21) represents the lowest level inside the Company at which goodwill is monitored for internal administration purposes, which is not larger than a business segment. The cash generating units to which the goodwill is assigned are tested for impairment annually or with a higher frequency, when there are signs indicating that a cash generating unit could experience impairment or some of the significant market conditions have changed.

Goodwill in the acquisition of joint ventures is assessed for impairment as part of the investment, provided that there are signs indicating that the investment may be impaired.

An impairment loss is recognized for the amount that the book value of the cash generating unit exceeds its recoverable value, the recoverable value being the higher of the fair value of the cash generating unit, less costs to sell and its value in use.

An impairment loss is first assigned in goodwill to reduce its book value, and then to other assets in the cash generating unit. A recognized impairment loss is not reversed in the following years.

### 2.17 Impairment of non financial assets other than goodwill

The Company annually assesses the existence of impairment indicators on non-financial assets. When indicators exist, the Company estimates the recoverable amount of the impaired asset. In case it is not possible to estimate the recoverable amount of the impaired asset at an individual level, the Company estimates the recoverable amount of the cash generating unit to which the asset belongs.

For indefinite useful life intangible assets, which are not amortized, the Company performs all required test to ensure that the carrying amount does not exceed recoverable value.

The recoverable amount is defined as the higher of the fair value, less cost to sell and the value in use. The value in use is determined by estimating future cash flows associated with the asset or with the cash generating unit, discounted from its current value by using interest rates before taxes, which reflect the time value of money and the specific risks of the asset. In the event the asset book value exceeds its recoverable amount, the Company records an impairment loss in the Statement of Income.

For other non-financial assets different than goodwill and intangibles with indefinite useful life, the Company assesses the existence of impairment indicators when some event or change in business circumstances indicate that the book value of the asset may not be recoverable and impairment is recognised when the book value is higher than its recoverable value.

The Company annually assesses if impairment indicators of non-financial assets for which impairment losses were recorded during prior years have disappeared or decreased. In the event of such situation, the recoverable amount of the specific asset is recalculated and its book value increased, if necessary. Such increase is recognized in the Statement of Income as reversal of impairment losses. The increase in the value of the previously impaired asset is recognized only when it is originated by changes in the assumptions used to calculate the recoverable amount. The asset amount increase resulting from the reversal of the impairment loss is limited to the amount that would have been recorded had impairment not occurred.

F-27

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

### 2.18 Assets of a disposal group held for sale

Property, plant and equipment expected to be recovered primarily through sale rather than through continuing use, for which active sale negotiations have begun and it is estimated that they will be sold within twelve months following the closing date are classified as assets of a disposal group held for sale.

These assets are measured at the lower of their book value and the estimated fair value, less costs to sell. From the moment in which the assets are classified as assets of a disposal group held for sale they are no longer depreciated.

### 2.19 Income taxes

Income taxes are composed by the legal obligations and the deferred taxes recognized according to International Accounting Standard Nº 12 – Income Taxes. Income tax is recognized in the Statement of Income, except when it is related to entries directly recorded in Equity, in which case the tax effect is also recognized in Equity.

Income Tax Obligation

Income tax obligations are recognized in the financial statements on the basis of the best estimates of the taxable profits as of the financial statement closing date, and the income tax rate valid as of that date in the countries where the Company operates.

Deferred Tax

Deferred taxes are those the Company expects to pay or to recover in the future, due to temporary differences between the book value of assets and liabilities (carrying amount for financial reporting purposes) and the corresponding tax basis of such assets and liabilities used to determine the profits subject to taxes. Deferred tax assets and liabilities are generally recognized for all temporary differences, and they are calculated at the rates that will be valid on the date the liabilities are paid or the assets realized.

Deferred tax is recognized for temporary differences arising from investments in subsidiaries and associates, except in those cases where the Company is able to control the date on which temporary differences will be reversed, and it is likely that they will not be reverted in the foreseeable future. Deferred tax assets, including those originated by tax losses are recognized provided it is likely that in the future there are taxable profits against which deductible temporary differences may be charged.

Deferred tax assets and liabilities are offset when there is a legal right to offset tax assets against tax liabilities, and the deferred tax is related to the same taxable entity and the same taxing authority.

### 2.20 Employees benefits

Employees Vacation

The Company accrues the expense associated with staff vacation when the employee earns the benefit.

Employees Bonuses

The Company recognizes a liability and an expense for bonuses when it’s contractually obligated, it is estimated that, depending on the income requirement at a given date, bonuses will be paid out at the end of the year.

Severance Indemnity

The Company recognizes a liability for the payment of irrevocable severance indemnities, originated from the collective and individual agreements entered into with employees. Such obligation is determined based on the actuarial value of the accrued cost of the benefit, a method which considers several factors in the calculation, such as estimates of future continuance, mortality rates, future salary increases and discount rates. The determined value is shown at its present value by using the accrued benefits for years of service method. The discount rates are determined by reference to market interest rates curves. The current losses and gains are directly recorded in Income.

F-28

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

According to the amendment of IAS 19, the actuarial gains and losses are recognized directly in Other Comprehensive Income, under Equity and, according to the accounting policies of the Company, financial costs related to the severance indemnity are directly recorded under Financial cost in the Consolidated Statement of Income.

### 2.21 Provisions

Provisions are recognized when: (i) the Company has a current obligation, legal or implicit, as a result of past events, (ii) it is probable that monetary resources will be required to settle the obligation and (iii) the amounts can be reasonably established. The amounts recognized as provisions as of financial statements closing date, are Management´s best estimates, and consider the necessary disbursements to liquidate the obligation.

The concepts by which the Company establishes provisions against Income correspond to civil, labour and taxation proceedings that could affect the Company (See Note 28).

### 2.22 Revenue recognition

Revenues are recognized when it is likely that economic benefits flow to the Company and can be measured reliably. Income is measured at the fair value of the economic benefits received or to be received, and they are presented net of valued added taxes, specific taxes, returns, discounts and rebates.

Sales of goods are recognized after the Company has transferred to buyer all the risks and benefits inherent in the ownership of such goods, and it does not hold the right to dispose of them; in general, this means that sales are recorded at the transfer of risks and benefits to clients, pursuant to the terms agreed in the commercial agreements.

Sale of products in the domestic market

The Company obtains its revenues, both in Chile and Argentina, mainly from the sales of beers, soft drinks, mineral waters, purified water, juices, wines, cider and spirits, products that are distributed through retail establishments, wholesale distributors and supermarket chains. None of which act as commercial agents of the Company. Such revenues in the domestic markets, net of the value added tax, specific taxes, returns, discounts and rebates to clients, are recognized when products are delivered, together with the transfer of all risks and benefits related to them.

Exports

In general, the Company´s delivery conditions for sale are the basis for revenue recognition related to exports.

The structure of revenue recognition is based on the grouping of Incoterms, mainly in the following groups:

• "FOB (Free on Board) shipping point", by which buyer organizes and pays for transportation, consequently the sales occur and revenue is recognized upon the delivery of merchandise to the transporter hired by buyer.

• “CIF (Cost, Insurance & Freight) and similar", by which the Company organizes and pays for external transportation and some other expenses, although CCU ceases being responsible for the merchandise after delivering it to the maritime or air company in accordance with the relevant terms. The sales occur and revenue is recognized upon the delivery of the merchandise at the port of destination.

In the case of discrepancies between the commercial agreements and Incoterms, the first one will prevail.

### 2.23 Commercial agreements with distributors and supermarket chains

The Company enters into commercial agreements with its clients, distributors and supermarkets through which they establish: (i) volume discounts and other client variables, (ii) promotional discounts that correspond to an additional rebate on the price of the products sold by reason of commercial initiatives development (temporary promotions), (iii) services payment and rendering of counter-services (advertising and promotion agreements, use of preferential spaces and others) and (iv) shared advertising, which corresponds to the Company’s participation in advertising campaigns, promotion magazines and opening of new sales locations.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Volume discounts and promotional discounts are recognized as a reduction in the sales price of the products sold. Shared advertising contributions are recognized when the advertising activities agreed upon with the distributor have been carried out, and they are recorded as marketing expenses incurred, under Other expenses by function.

The commitments with distributors or importers in the exports area are recognized on the basis of existing trade agreements.

### 2.24 Cost of sales of products

The costs of sales include the production cost of the products sold and other costs incurred to place inventories in the locations and under the conditions necessary for the sale. Such costs mainly include raw material costs, packing costs, production staff labour costs, production-related assets depreciation, returnable bottles depreciation, license payments, operational costs and plant and equipment maintenance costs.

### 2.25 Other expenses by function

Other expenses by function include, mainly advertising and promotion expenses, depreciation of assets sold, selling expenses, marketing costs (sets, signs, neon signs at client’s facilities) and marketing and sales staff remuneration and compensations.

### 2.26 Distribution expenses

Distribution costs include all the necessary costs to deliver products to clients.

### 2.27 Administration expenses

Administration expenses include the support units staff remuneration and compensation, depreciation of offices, equipment, facilities and furniture used for these functions, non-current assets amortization and other general and administration expenses.

### 2.28 Environment liabilities

Environmental liabilities are recorded based on the current interpretation of environmental laws and regulations, or when an obligation is likely to occur and the amount of such liability can be calculated reliably.

Disbursements related to environmental protection are charged to the Consolidated Statements of Income as incurred, except, investments in infrastructure designed to comply with environmental requirements, are recorded following the accounting policies for property, plant and equipment.

# Note 3 Estimates and application of professional judgment

Financial statement preparation requires estimates and assumptions from Management affecting the amounts included in the consolidated financial statements and their related notes. The estimates made and the assumptions used by the Company are based on the historical experience, changes in the industry and the information supplied by external qualified sources. Nevertheless, final results could differ from the estimates under certain conditions.

Significant estimates and accounting policies are defined as those that are important to correctly reflect the Company’s financial position and income, and/or those that require a high level of judgment by Management.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The primary estimates and professional judgments relate to the following concepts:

• The valuation of goodwill acquired to determine the existence of losses due to potential impairment (Note 2, 2.16 and Note 21).

• The valuation of commercial trademarks to determine the existence of potential losses due to potential impairment (Note 2, 2.17 and Note 20).

• The assumptions used in the current calculation of liabilities and obligations to employees (Note 2, 2.20 and Note 30).

• Useful life of property, plant and equipment (Note 2, 2.12 and Note 22) and intangibles (Note 2, 2.15 and Note 20).

• The assumptions used for the calculation of fair value financial instruments (Note 2, 2.7 and Note 6).

• The occurrence likelihood and the estimates amount in an uncertain or contingent manner (Note 2, 2.21 and Note 28).

• The valuation of Biological current assets (Note 2, 2.10 and Note 17).

Such estimates are based on the best available information of the events analysed to date in these consolidated financial statements. However, it is possible that events that may occur in the future that result in adjustments to such estimates, which would be recorded prospectively.

# Note 4 Accounting changes

During the year ended on December 31, 2016, there have been no significant changes in the use of accounting principles or relevant changes in any accounting estimates with regard to previous years that have affected these consolidated financial statements.

# Note 5 Risk Administration

Risk administration

In those companies without a significant non-controlling interest, the Company’s Administration and Finance Officer provides a centralized service for the group’s companies to obtain financing and administration of exchange rate, interest rate, liquidity, inflation, raw material and loan risks. Such activity operates according to a policies and procedures framework, which is regularly reviewed to comply with the purpose of administrating the risk originated by the business needs.

In those companies with a significant non-controlling interest (VSPT, CPCh, Aguas CCU-Nestlé, Bebidas del Paraguay S.A. and Cervecera Kunstmann) each Administration and Finance Officer exercises such responsibility. When necessary, the Board of Directors has the final responsibility for establishing and reviewing the risk administration structure, as well as for the review of significant changes made to the risk administration policies.

According to the financial risk policies, the Company uses derivative instruments only for the purpose of covering exposures to the interest rate and exchange rate risks originated by the Company’s operations and its financing sources. The Company does not acquire derivative facilities with speculative or investment purposes nevertheless, some derivatives are not treated as hedges for accounting purposes because they do not qualify as such. Transactions with derivative instruments are exclusively carried out by staff under the Finance Management and Internal Audit Management regularly reviews the control environment of this function. The relationship with Credit Rating Agencies and the monitoring of financial restrictions (covenants) are also administered by Finance Management.

The Company’s main risk exposure is related to the exchange rates, interest rates, inflation and raw material prices (commodities), taxes, client’s accounts receivable and liquidity. For the purpose of managing the risk originated by such exposures, several financial instruments are used.

For each of the following, where applicable, sensitivity analysis developed are for illustrative purposes, since in practice the sensitized variables rarely change without affecting each other and without affecting other factors that were considered as constants.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

### Exchange rate risk

The Company is exposed to exchange rate risks originated by: a) its net exposure to foreign currency assets and liabilities, b) exports sales, c) the purchase of raw material, products and capital investments effected in foreign currencies, or indexed in such currencies, and d) the net investment of subsidiaries in foreign countries. The Company’s greatest exchange rate exposure is the variation of the Chilean peso as compared to the US Dollar, Euro, Argentine Peso, Uruguayan Peso, Paraguayan Guarani, Bolivian Peso and Colombian Peso.

As of December 31, 2016, the Company maintained foreign currency obligations amounting to ThCh$ 49,694,209 (ThCh$ 49,785,548 in 2015), mostly denominated in US Dollars. Foreign currency obligations (ThCh$ 6,352,391 in 2016 and ThCh$ 16,626,496 in 2015) represent 4% (10% in 2015) of the total of Other financial liabilities. The remaining 96% (90% in 2015) is mainly denominated in inflation-indexed Chilean pesos (see inflation risk section). In addition, the Company maintains foreign currency assets for ThCh$ 66,435,330 (ThCh$ 72,887,721 in 2015) that mainly correspond to exports accounts receivable.

Regarding the foreign subsidiaries operations, the net exposure assets in US Dollars and other currencies amounts to ThCh$ 3,806,184 (ThCh$ 1,368,068 in 2015).

To protect the value of the net foreign currency assets and liabilities position of its Chilean operations, the Company enters into derivative agreements (currency forwards) to ease any variation in the Chilean peso as compared to other currencies.

As of December 31, 2016, the Company’s mitigate net asset exposure in foreign currencies in Chile, after the use of derivative instruments, is a asset amounting to ThCh$ 3,808,526 (liability amounting to ThCh$ 757,256 in 2015).

A s of December 31, 2016, of the Company’s total sales, both in Chile and abroad, 8% (8% in 2015 and 8% in 2014) corresponds to export sales made in foreign currencies, mainly US Dollars and Euro and of the total costs 63% (54% in 2015 and 55% in 2014) corresponds to raw materials and products purchased in foreign currencies, or indexed to such currencies. The Company does not hedge the eventual variations in the expected cash flows from such transactions.

The Company is also exposed to movements in exchange rates relating to the conversion from Argentine Pesos, Uruguayan Pesos, Paraguayan Guaranis, Bolivians and Colombian Pesos to Chilean Pesos with respect to assets, liabilities, income and expenses of its subsidiaries in Argentina, Uruguay and Paraguay, associated in Bolivia and joint ventures in Colombia. The Company does not cover the risks associated with the conversion of its subsidiaries, which effects are recorded in Equity.

As of December 31, 2016, the net investment in foreign subsidiaries, associated and joint ventures amounted to ThCh$ 135,001,540, ThCh$ 8,249,048 and ThCh$ 35,449,038 respectively (ThCh$ 133,554,918, ThCh$ 6,628,484 and ThCh$ 18,718,832 in 2015).

Exchange rate sensitivity analysis

The exchange rate differences effect recognized in the Consolidated Statement of Income for the year ended as of December 31, 2016, related to the foreign currency denominated assets and liabilities, was an income of ThCh$ 456,996 (income of ThCh$ 957,565 in 2015 and a loss of ThCh$ 613,181 in 2014). Considering the exposure as of December 31, 2016, and assuming a 10% increase (or decrease) in the exchange rate, and maintaining constant all other variables, such as interest rates, it is estimated that the effect over the Company’s income would be an income after taxes of ThCh$ 289,448 (a loss of ThCh$ 58,687 in 2015 and a loss of ThCh$ 204,456 in 2014).

Considering that approximately 8% of the Company’ sales relates to export sales carried out in Chile (8% in 2015 and 8% in 2014), in currencies different from the Chilean Peso, and in approximately 63% (54% in 2015 and 55% in 2014) of the Company’s direct costs are indexed to the US Dollar and assuming that the functional currencies will be appreciated or (depreciated) by 10% as compared to the set of foreign currencies, when maintaining constant the rest of the variables the hypothetical effect on the Company’s income would be loss after taxes of ThCh$ 13,908,457 (loss of ThCh$ 10,380,193 in 2015 and ThCh$ 10,004,379 in 2014).

The Company can also be affected by the variation of the exchange rate of where the foreign subsidiaries operate, since the result is converted to Chilean Pesos at the average rate of each month. The result of the operations in the foreign subsidiaries during the year 2016 were an income of ThCh$ 32,507,630 (ThCh$ 32,141,475 in 2015 and ThCh$ 29,235,462 in 2014). Therefore, a depreciation (or appreciation) of 10% in the exchange rate of the Argentine Peso, the Uruguayan Peso and the Paraguayan Guarani against the Chilean Peso, would be a loss (income) before tax of ThCh$ 3,250,763 (ThCh$ 3,214,147 in 2015 and ThCh$ 2,923,546 in 2014).

F-32

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

T he net investment in foreign subsidiaries, associated and joint ventures amounted to ThCh$ 135,001,540, ThCh$ 8,249,048 and ThCh$ 35,449,038, respectively (ThCh$ 133,554,918, ThCh$ 6,628,484 and ThCh$ 18,718,832 in 2015). Assuming a 10% increase or decrease in the Argentine Peso, Uruguayan Peso, Paraguayan Guarani, Bolivians and Colombian Peso against the Chilean Peso, and maintaining constant all the rest of the variables, the increase (decrease) would hypothetically result in income (loss) of ThCh$ 17,869,963 (ThCh$ 16,655,069 in 2015) recorded as a credit (charge) against Equity.

The Company does not cover the risks associated with the currency conversion of the financial statements of its subsidiaries that have other functional currency, whose effects are reported in Equity.

Interest rates risk

The interest rate risk mainly originated from the Company’s financing sources. The main exposure is related to London Inter Bank Offer Rate (“LIBOR”) and Buenos Aires Deposits of Large Amount Rate (“BADLAR”) variable interest rate indexed obligations.

As of December 31, 2016, the Company had a total ThCh$ 10,142,841 in debt indexed to variable interest rates (ThCh$ 20,206,608 in 2015). Consequently, as of December 31, 2016, the company’s financing structure is made up (without considering the effects of cross currency swaps effect) of approximately 6% (12% in 2015) in debt with variable interest rates, and 94% (88% in 2015) in debt with fixed interest rates.

To administer the interest rate risk, the Company has a policy that intends to reduce the volatility of its financial expense, and to maintain an ideal percentage of its debt in fixed rate instruments. The financial position is mainly set by the use of short-term and long-term debt, as well as derivative instruments such as cross currency interest rate swaps and cross interest rate swaps.

As of December 31, 2016, after considering the effect of interest rates and currency swaps, approximately 97% (97% in 2015) of the Company’s long-term debt has fixed interest rates.

The terms and conditions of the Company’s obligations as of December 31, 2016, including exchange rates, interest rates, maturities and effective interest rates, are detailed in Note 26.

Interest rates sensitivity analysis

The total financial expense recognized in the Consolidated Statement of Income for the twelve month ended as of December 31, 2016, related to short-term and long-term debts amounted to ThCh$ 20,307,238 (ThCh$ 23,101,329 in 2015 and ThCh$ 22,957,482 in 2014). Assuming a reasonably possible increase of 100 bps in variable interest rates and maintaining constant all the rest of the variables, the increase would hypothetically result in a loss before tax of ThCh$ 48,700 (ThCh$ 42,664 in 2015).

### Inflation risk

The Company maintains a series of Unidad de Fomento* (UF) indexed agreements with third parties, as well as UF indexed financial debt, which means that the Company is exposed to the UF fluctuations, generating increases in the value of the agreements and inflation adjustable liabilities, in the event it experiences growth. This risk is mitigated by the Company’s policy of keeping the unitary net sales in UF constant, as long as the market conditions allow it.

* The Unidad de Fomento (UF) is a Chilean inflation-indexed, peso-denominated monetary unit. The UF rate is set daily based on changes in the previous month´s inflation rate.

Inflation sensitivity analysis

The income for total adjustment unit recognized in the Consolidated Statement of Comprehensive Income for the twelve month ended as of December 31, 2016, related to UF indexed short-term and long-term debt, and resulted in a loss of ThCh$ 2,246,846 (ThCh$ 3,282,736 in 2015 and ThCh$ 4,159,131 in 2014). Assuming a reasonably possible increase (decrease) of the Unidad de Fomento by approximately 3% and maintaining constant all the rest of the variables, such as interest rates, the aforementioned increase (decrease) would hypothetically result in a loss (income) of ThCh$ 3,065,645 (ThCh$ 3,065,747 in 2015 and ThCh$ 3,035,371 in 2014) in the Consolidated Statement of Income.

F-33

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

### Raw material price risk

The main exposure to the raw material price variation is related to barley and malt used in the production of beer, concentrates, sugar and plastic containers used in the production of soft drinks and bulk wine and grapes for the manufacturing of wine and spirits.

Barley, malt and cans

In Chile, the Company obtains its barley and malt supply both from local producers and the international market. Long-term supply agreements are entered into with local producers where the barley price is set annually according to market prices, which are used to determine the malt price according to the agreements. The purchases commitments made expose the Company to a raw material price fluctuation risk. During 2016, the Company purchased 13,914 tons (46,620 tons in 2015) of barley and 61,753 tons (53,890 tons in 2015) of malt. CCU Argentina acquires mainly malt from local producers. Such raw materials represent approximately 7% (9% in 2015 and 12% in 2014) of the direct cost of Chile Operating segment.

Of the cost of Chile Operating segment, the cost of cans represents approximately 15% of the direct cost (12% in 2015 and 12% in 2014). Meanwhile in the International Business Operating segment the cans cost represent approximately 34% of the direct cost of raw materials in 2016 (30% in 2015 and 20% in 2014).

Concentrates, Sugar and plastic containers

The main raw materials used in the production of non-alcoholic beverages are concentrates, which are mainly acquired from licensees, sugar and plastic resin for the manufacturing of plastic bottles and containers. The Company is exposed to price fluctuation risks of these raw materials, which jointly represent approximately 30% (29% in 2015 and 29% in 2014) of the direct cost of Chile Operating segment. The company does not engage in hedging the purchases of raw materials.

Grapes and wine

The main raw material used by the subsidiary VSPT for wine production are harvested grapes from own production and grapes and wines acquired from third parties through long term and spot contracts. For the last 12 months, approximately 26% (31% in 2015) of the total wine of VSPT supply comes from its own vineyards. In the export business the own supply for 2016 was 40% (48% for 2015).

The remaining 74% (69% in 2015) supply is purchased from third parties through long term and spot contracts. During 2016, the subsidiary VSPT acquired 64% (55% in 2015) of the necessary grapes and wine from third parties through spot contracts. It also acquired 11% of its grape needs in 2016 from long term agreements (14% in 2015).

We must consider that as of December 31, 2016, the wine represents 56% (57% in 2015) of the total direct cost of the Wine Operating Segment, meaning that the supply purchased to third parties represents 36% of the direct cost (31% in 2015).

Raw material price sensitivity Analysis

The total direct cost in the Consolidated Statement of Income for 2016 amounts to ThCh$ 540,692,963 (ThCh$ 485,391,583 in 2015 and ThCh$ 433,749,832 in 2014). Assuming a reasonably possible increase (decrease) in the direct cost of each Operating segment of 8% and maintaining constant all the rest of the variables, such as exchange rates, the aforesaid increase (decrease) would hypothetically result into a loss (income) before taxes of ThCh$ 28,076,333 (ThCh$ 24,078,370 in 2015 and ThCh$ 21,875,405 in 2014) for Chile Operating segment, ThCh$ 8,089,082 (ThCh$ 8,444,331 in 2015 and ThCh$ 5,925,786 in 2014) for International Business Operating segment, ThCh$ 7,222,786 (ThCh$ 6,736,734 in 2015 and ThCh$ 6,414,035 2014) for Wine Operating segment.

F-34

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

### Credit risk

The credit risk to which the Company is exposed originates from: a) the commercial accounts receivable maintained with retail clients, wholesale distributors and supermarket chains of domestic markets; b) accounts receivable from exports; and c) financial facilities maintained with Banks and financial institutions, such as demand deposits, mutual funds investments, facilities acquired under resale commitments and derivatives.

Domestic market

The credit risk related to commercial collectible accounts of domestic markets is administered by the Loan and Collection Administration Officer, and it is monitored by the Loan Committee of each business unit. The Company has a wide client base that is subject to the policies, procedures and controls established by the Company. The loan limits are established for all clients on the basis of an internal qualification and payment performance. Outstanding commercial accounts receivable are regularly monitored. In addition, the Company acquires loan insurances covering 90% of the individually significant accounts receivable balances, a coverage that as of December 31, 2016, amounts to 88% (88% in 2015) of the total accounts receivable.

Overdue but not impaired commercial accounts receivable corresponds to clients that show delays of less than 33 days (21 days in 2015).

As of December 31, 2016, the Company had approximately 1,078 clients (998 clients in 2015) indebted in over Ch$ 10 million each that together represent approximately 84% (85% in 2015) of the total commercial accounts receivable. There were 224 clients (217 clients in 2015) with balances over Ch$ 50 million each, representing approximately 74% (74% in 2015) of the total accounts receivable. The 91% (93% in 2015) of such accounts receivable are covered by the loan insurance.

The Company believes that no additional credit risk provisions are needed to the individual and collective provisions determined at December 31, 2016, as a large percentage of these are covered by insurance.

Exports market

The loan risk related to accounts receivable for exports is administered by VSPT Head of Loan and Collection, and it is monitored by VSPT Administration and Finance Officer. The Company has a large client base, in over eighty countries, which are subject to the policies, procedures and controls established by the Company. In addition, the Company acquires loan insurance covering 90% (89% in 2015) of the total accounts receivable. Pending payment of commercial accounts receivable is regularly monitored. Apart from the loan insurance, having diversified sales in different countries decreases the loan risk.

As of December 31, 2016, there were 76 clients (69 clients in 2015) indebted for over ThCh$ 65,000 each, which represent 91% (88% in 2015) of the total accounts receivable of the export market.

Overdue, but not impaired, commercial accounts receivable corresponds to clients that show delays of less than 32 days (25 days in 2015).

The Company estimates that no loan risk provisions are necessary in addition to the individual and collective provisions determined as of December 31, 2016. See analysis of accounts receivables maturities and losses due to impairment of accounts receivables (Note 14).

The Company has policies limiting the counterparty loan risk exposure with respect to financial institutions, and such exposures are frequently monitored. Consequently, the Company does not have significant risk concentration with any specific financial institutions as of December 31, 2016.

### Financial investments and derivative instruments

The financial investments correspond to time deposits, investments in mutual funds and financial instruments acquired under re-sale agreements, as well as short-term investments with high liquidity, all at a fixed interest rate, normally with an original maturity of up to three months, which they are not exposed to significant risks of market. With respect to financial derivative instruments, these are valued at fair value and contracted only in the Chilean market.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

### Liquidity risk

The Company administers liquidity risk at a consolidated level. The cash flows originated from operational activities being the main liquidity source. Additionally, the Company has the ability to issue debt and equity instruments in the capital market according to our needs.

To manage short-term liquidity, the Company considers projected cash flows for a twelve months moving period and maintains cash and cash equivalents available to meet its obligations.

Based on the current operational performance and its liquidity position, the Company estimates that cash flows originated by operating activities and the cash available shall be sufficient to finance working capital, capital investments, interest payments, dividend payments and debt payment requirements for the next 12-month period and the foreseeable future.

A summary of the Company’s financial liabilities with their maturities as of December 31, 2016 and 2015, based on the non-discounted contractual cash flows appears below:

As of December 31, 2016 | Book value (*) | Contractual cash flows maturities
0 to 3 months | 3 months to 1 year | Over 1 year to 3 years | Over 3 years to 5 years | Over 5 years | Total
ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Other financial liabilities no derivative |  |  |  |  |  |  |
Bank borrowings | 68,685,959 | 8,567,124 | 34,661,755 | 31,604,772 | 626,411 | - | 75,460,062
Bond payable | 74,086,739 | 1,108,143 | 4,551,720 | 13,401,920 | 19,666,590 | 56,878,538 | 95,606,911
Financial leases obligations | 17,716,869 | 368,052 | 1,050,810 | 2,603,315 | 2,305,704 | 28,638,952 | 34,966,833
Deposits for return of bottles and containers | 13,015,723 | - | 13,015,723 | - | - | - | 13,015,723
Sub-Total | 173,505,290 | 10,043,319 | 53,280,008 | 47,610,007 | 22,598,705 | 85,517,490 | 219,049,529
Derivative |  |  |  |  |  |  |
Derivative financial instruments | 11,118,676 | 11,118,676 | - | - | - | - | 11,118,676
Sub-Total | 11,118,676 | 11,118,676 | - | - | - | - | 11,118,676
Total | 184,623,966 | 21,161,995 | 53,280,008 | 47,610,007 | 22,598,705 | 85,517,490 | 230,168,205

As of December 31, 2015 | Book value (*) | Contractual cash flows maturities
0 to 3 months | 3 months to 1 year | Over 1 year to 3 years | Over 3 years to 5 years | Over 5 years | Total
ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Other financial liabilities no derivative |  |  |  |  |  |  |
Bank borrowings | 76,050,091 | 18,531,305 | 30,981,974 | 32,627,707 | 3,135,314 | - | 85,276,300
Bond payable | 74,508,233 | 1,077,908 | 4,529,040 | 10,909,363 | 17,346,078 | 64,742,891 | 98,605,280
Financial leases obligations | 17,559,874 | 418,380 | 1,087,320 | 2,709,603 | 2,439,335 | 28,871,228 | 35,525,866
Deposits for return of bottles and containers | 12,503,170 | - | 12,503,170 | - | - | - | 12,503,170
Sub-Total | 180,621,368 | 20,027,593 | 49,101,504 | 46,246,673 | 22,920,727 | 93,614,119 | 231,910,616
Derivative |  |  |  |  |  |  |
Hedging derivatives | 107,698 | 61,543 | 46,333 | - | - | - | 107,876
Derivative financial instruments | 171,470 | 167,701 | 3,770 | - | - | - | 171,471
Sub-Total | 279,168 | 229,244 | 50,103 | - | - | - | 279,347
Total | 180,900,536 | 20,256,837 | 49,151,607 | 46,246,673 | 22,920,727 | 93,614,119 | 232,189,963

(*) View current and non-current book value in Note 6.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 6 Financial Instruments

Financial instruments categories

The following are the book values of each financial instrument category at the closing of each year:

| As of December 31, 2016 | As of December 31, 2015
| Current | Non current | Current | Non current
| ThCh$ | ThCh$ | ThCh$ | ThCh$
Cash and cash equivalents | 133,789,950 | - | 192,554,239 | -
Other financial assets | 8,406,491 | 203,784 | 13,644,105 | 80,217
Accounts receivable - trade and other receivable (net) | 280,766,784 | 3,563,797 | 252,225,937 | -
Acoounts receivable from related companies | 3,523,825 | 356,665 | 4,788,930 | 445,938
Total financial assets | 426,487,050 | 4,124,246 | 463,213,211 | 526,155
Bank borrowings | 39,079,561 | 29,606,398 | 27,714,998 | 48,335,093
Bonds payable | 3,250,023 | 70,836,716 | 3,155,239 | 71,352,994
Financial leases obligations | 215,950 | 17,500,919 | 321,416 | 17,238,458
Derivative financial instruments | 11,118,676 | - | 171,470 | -
Hedging derivatives | - | - | 107,698 | -
Deposits for return of bottles and containers | 13,015,723 | - | 12,503,170 | -
Total other non-financial liabililities (*) | 66,679,933 | 117,944,033 | 43,973,991 | 136,926,545
Account payable- trade and other payable | 259,677,852 | 1,082,898 | 227,736,803 | 1,645,098
Accounts payable to related entities | 9,530,071 | - | 11,624,218 | -
Total financial liabilities | 335,887,856 | 119,026,931 | 283,335,012 | 138,571,643

(*) See Note 26 - Other financial liabilities.

Financial instruments fair value

a) Composition of financial assets and liabilities:

The following tables show the fair values, based on the financial instrument categories, as compared to the book value included in the Consolidated Statements of Financial Position:

| As of December 31, 2016 | As of December 31, 2015
| Book Value | Fair Value | Book Value | Fair Value
| ThCh$ | ThCh$ | ThCh$ | ThCh$
Cash and cash equivalents | 133,789,950 | 133,789,950 | 192,554,239 | 192,554,239
Other financial assets | 8,610,275 | 8,610,275 | 13,724,322 | 13,724,322
Accounts receivable - trade and other receivable (net) | 284,330,581 | 284,330,581 | 252,225,937 | 252,225,937
Acoounts receivable from related companies | 3,880,490 | 3,880,490 | 5,234,868 | 5,234,868
Total financial assets | 430,611,296 | 430,611,296 | 463,739,366 | 463,739,366
Bank borrowings | 68,685,959 | 69,668,649 | 76,050,091 | 77,380,452
Bonds payable | 74,086,739 | 81,769,096 | 74,508,233 | 80,087,449
Financial leases obligations | 17,716,869 | 30,154,204 | 17,559,874 | 29,104,078
Derivative financial instruments | 11,118,676 | 11,118,676 | 171,470 | 171,470
Hedging derivatives | - | - | 107,698 | 107,698
Deposits for return of bottles and containers | 13,015,723 | 13,015,723 | 12,503,170 | 12,503,170
Total other non-financial liabililities (*) | 184,623,966 | 205,726,348 | 180,900,536 | 199,354,317
Account payable- trade and other payable | 260,760,750 | 260,760,750 | 229,381,901 | 229,381,901
Accounts payable to related entities | 9,530,071 | 9,530,071 | 11,624,218 | 11,624,218
Total financial liabilities | 454,914,787 | 476,017,169 | 421,906,655 | 440,360,436

(*) See Note 26 - Other financial liabilities.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The book value of current accounts receivables, cash and cash equivalents and other financial assets and liabilities approximate fair value due to the short-term nature of such facilities, and in the case of accounts receivable, due to the fact that any collection loss is already reflected in the impairment loss provision.

The fair value of non-derivative financial assets and liabilities that are not quoted in active markets are estimated through the use of discounted cash flows calculated on market variables observed as of the date of the financial statements. The fair value of derivative instruments is estimated through the discount of future cash flows, determined according to information observed in the market or to variables and prices obtained from third parties.

The fair value of bank borrowings and Bonds payable have hierarchy level 2 of fair value.

b) Financial instruments as per category:

As of December 31, 2016 | Fair value with changes in income | Cash and cash equivaletns and loans and accounts receivables | Hedge derivatives | Total
ThCh$ | ThCh$ | ThCh$ | ThCh$
Financial assets |  |  |  |
Derivative financial instruments | 479,492 | - | 309,237 | 788,729
Marketable securities and investments in other companies | 7,821,546 | - | - | 7,821,546
Total other financial assets | 8,301,038 | - | 309,237 | 8,610,275
Cash and cash equivalents | - | 133,789,950 | - | 133,789,950
Accounts receivable-trade and other receivables (net) | - | 284,330,581 | - | 284,330,581
Account receivable from to related companies | - | 3,880,490 | - | 3,880,490
Total | 8,301,038 | 422,001,021 | 309,237 | 430,611,296

As of December 31, 2016 | Fair value with changes in income | Hedge derivatives | Financial libilities measured at amortized cost | Total
ThCh$ | ThCh$ | ThCh$ | ThCh$
Financial liabilities |  |  |  |
Bank borrowings | - | - | 68,685,959 | 68,685,959
Bonds payable | - | - | 74,086,739 | 74,086,739
Financial leases obligations | - | - | 17,716,869 | 17,716,869
Deposits for return of bottles and containers | - | - | 13,015,723 | 13,015,723
Derivative financial instruments | 11,118,676 | - | - | 11,118,676
Total others financial liabililities | 11,118,676 | - | 173,505,290 | 184,623,966
Account payable- trade and other payable | - | - | 260,760,750 | 260,760,750
Accounts payable to related entities | - | - | 9,530,071 | 9,530,071
Total | 11,118,676 | - | 443,796,111 | 454,914,787

F-38

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

As of December 31, 2015 | Fair value with changes in income | Cash and cash equivaletns and loans and accounts receivables | Hedge derivatives | Total
ThCh$ | ThCh$ | ThCh$ | ThCh$
Financial assets |  |  |  |
Derivative financial instruments | 9,365,572 | - | 816,622 | 10,182,194
Marketable securities and investments in other companies | 3,542,128 | - | - | 3,542,128
Total other financial assets | 12,907,700 | - | 816,622 | 13,724,322
Cash and cash equivalents | - | 192,554,239 | - | 192,554,239
Accounts receivable-trade and other receivables (net) | - | 252,225,937 | - | 252,225,937
Account receivable from to related companies | - | 5,234,868 | - | 5,234,868
Total | 12,907,700 | 450,015,044 | 816,622 | 463,739,366

As of December 31, 2015 | Fair value with changes in income | Hedge derivatives | Financial libilities measured at amortized cost | Total
ThCh$ | ThCh$ | ThCh$ | ThCh$
Financial liabilities |  |  |  |
Bank borrowings | - | - | 76,050,091 | 76,050,091
Bonds payable | - | - | 74,508,233 | 74,508,233
Financial leases obligations | - | - | 17,559,874 | 17,559,874
Deposits for return of bottles and containers | - | - | 12,503,170 | 12,503,170
Derivative financial instruments | 171,470 | 107,698 | - | 279,168
Total others financial liabililities | 171,470 | 107,698 | 180,621,368 | 180,900,536
Account payable- trade and other payable | - | - | 229,381,901 | 229,381,901
Accounts payable to related entities | - | - | 11,624,218 | 11,624,218
Total | 171,470 | 107,698 | 421,627,487 | 421,906,655

F-39

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Derivative Instruments

The detail of maturities, number of derivative agreements, contracted nominal amounts, fair values and the classification of such derivative instruments as per type of agreement at the closing of each year is as follows:

| As of December 31, 2016 | As of December 31, 2015
Number of agreements | Nominal amounts thousand | Asset | Liability | Number of agreements | Nominal amounts thousand | Asset | Liability
ThCh$ | ThCh$ | ThCh$ | ThCh$
Cross currency interest rate swaps CLP/USD | 1 | 11,237 | 53,743 | - | - | - | - | -
Less than a year | 1 | 11,237 | 53,743 | - | - | - | - | -
Cross interest rate swaps USD/USD | - | - | - | - | 1 | 10,094 | - | 107,698
Less than a year | - | - | - | - | - | 10,094 | - | 107,698
Cross currency interest rate swaps USD/EURO | 1 | 7,889 | 255,494 | - | 2 | 12,353 | 816,622 | -
Less than a year | - | - | 51,710 | - | - | 4,477 | 736,405 | -
Between 1 and 5 years | - | 7,889 | 203,784 | - | - | 7,876 | 80,217 | -
Forwards USD | 29 | 224,332 | 359,254 | 10,586,653 | 27 | 148,404 | 9,276,156 | 117,151
Less than a year | - | 224,332 | 359,254 | 10,586,653 | - | 148,404 | 9,276,156 | 117,151
Forwards Euro | 10 | 49,421 | 109,164 | 523,079 | 7 | 11,981 | 57,834 | 52,368
Less than a year | - | 49,421 | 109,164 | 523,079 | - | 11,981 | 57,834 | 52,368
Forwards CAD | 2 | 1,480 | 11,074 | 7,720 | 4 | 1,500 | 18,192 | 1,951
Less than a year | - | 1,480 | 11,074 | 7,720 | - | 1,500 | 18,192 | 1,951
Forwards GBP | 2 | 700 | - | 1,224 | 3 | 865 | 13,390 | -
Less than a year | - | 700 | - | 1,224 | - | 865 | 13,390 | -
Total derivative instruments | 45 |  | 788,729 | 11,118,676 | 44 |  | 10,182,194 | 279,168

These derivative agreements have been entered into as a hedge of exchange rate risk exposure. In the case of forwards, the Company does not comply with the formal requirements for hedging designation; consequently their effects are recorded in Income, in Other gains (losses).

In the case of Cross Currency Interest Rate Swaps and the Cross Interest Rate Swaps, these qualify as cash flow hedges of the cash flows related to loans from Banco de Chile and Banco Scotiabank. See additional disclosures in Note 26.

As of December 31, 2016
Entity | Nature of risks covered | Rights | Obligations | Fair value of net asset (liabilities) | Maturity
Currency | Amount | Currency | Amount | Amount
ThCh$ | ThCh$ | ThCh$
Scotiabank | Interest rate and exchange rate on bank bonds | USD | 5,335,826 | EUR | 5,080,332 | 255,494 | 06-18-2018
Banco de Chile | Interest rate on bank bonds | CLP | 7,458,187 | USD | 7,404,444 | 53,743 | 07-03-2017

F-40

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

As of December 31, 2015
Entity | Nature of risks covered | Rights | Obligations | Fair value of net asset (liabilities) | Maturity
Currency | Amount | Currency | Amount | Amount
ThCh$ | ThCh$ | ThCh$
Scotiabank | Interest rate and exchange rate in bank obligations | USD | 5,700,299 | EUR | 5,589,172 | 111,127 | 06-18-2018
Banco de Chile | Interest rate and exchange rate on bank bonds | USD | 3,205,865 | EUR | 2,500,370 | 705,495 | 07-11-2016
Banco de Chile | Interest rate on bank bonds | USD | 7,227,245 | USD | 7,334,943 | (107,698) | 07-07-2016

The Consolidated Statement of Other Comprehensive Income includes under the caption cash flow hedge, for the years ended December 31, 2016, a credit before income taxes of ThCh$ 84,962 (ThCh$ 80,693 and ThCh$ 155,258, in 2015 and 2014, respectively), relating to the fair value of the Cross Currency Interest Swap and Cross Interest Rate Swap derivatives instruments.

Fair value hierarchies

The financial instruments recorded at fair value in the Statement of Financial Position are classified as follows, depending on the method used to obtain their fair values:

Level 1 Fair values obtained through direct reference to quoted market prices, without any adjustment.

Level 2 Fair values obtained through the use of valuation models accepted in the market and based on prices different from those of Level 1, which may be directly or indirectly observed as of the measurement date (adjusted prices).

Level 3 Fair values obtained through internally developed models or methodologies that use information which may not be observed or which is illiquid.

The fair value of financial instruments recorded at fair value in the Consolidated Financial Statements, are as follows:

As of December 31, 2016 | Recorded fair value | Fair value hierarchy
Level 1 | Level 2 | Level 3
ThCh$ | ThCh$ | ThCh$ | ThCh$
Derivative financial instruments | 479,492 | - | 479,492 | -
Market securities and investments in other companies | 7,821,546 | 7,821,546 | - | -
Hedging derivatives | 309,237 | - | 309,237 | -
Fair value financial assets | 8,610,275 | 7,821,546 | 788,729 | -
Derivative financial instruments | 11,118,676 | - | 11,118,676 | -
Fair value financial liabilities | 11,118,676 | - | 11,118,676 | -

F-41

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

As of December 31, 2015 | Recorded fair value | Fair value hierarchy
Level 1 | Level 2 | Level 3
ThCh$ | ThCh$ | ThCh$ | ThCh$
Derivative financial instruments | 9,365,572 | - | 9,365,572 | -
Market securities and investments in other companies | 3,542,128 | 3,542,128 | - | -
Hedging derivatives | 816,622 | - | 816,622 | -
Fair value financial assets | 13,724,322 | 3,542,128 | 10,182,194 | -
Hedging derivatives | 107,698 | - | 107,698 | -
Derivative financial instruments | 171,470 | - | 171,470 | -
Fair value financial liabilities | 279,168 | - | 279,168 | -

During year ended as of December 31, 2016, the Company has not made any significant instrument transfer between levels 1 and 2.

Credit Quality of financial assets

The Company uses two credit assessment systems for its clients: a) Clients with loan insurance are assessed according to the external risk criteria (trade reports, non-compliance and protested documents that are available in the local market), payment capability and equity situation required by the insurance company to grant a loan coverage; b) All other the clients are assessed through an ABC risk model, which considers internal risk (non-compliance and protested documents), external risk (trade reports, non-compliance and protested documents that are available in the local market) and payment capacity and equity situation. The uncollectible rate during the last two years has not been significant.

F-42

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 7 Financial Information as per operating segments

The Company has defined three Operating segments, essentially defined with respect to its revenues in the geographic areas of commercial activity: 1. Chile, 2. International business and 3. Wine.

From the fourth quarter of 2015 onwards, was created the Committee of International Business, which brings together management of the business activities regarding the geographical areas Argentina, Uruguay and Paraguay. Following this change, the Río de la Plata Operating segment (consisting of the business activities referred to) will be renamed into the International Business Operating Segment. The Committee of International Business will at the same time represent and look after the interests associated with the investments in Bolivia and Colombia, which will continue to report its results under Equity and income of JVs and associated on a consolidated basis.

Starting from the third quarter of 2016, the Company has incorporated in the Chile operating segment the business activities performed by the Strategic Service Units (SSU), which include Transportes CCU Limitada, Comercial CCU S.A., CRECCU S.A. and Fábrica de Envases Plásticos S.A. For the year ended December 31, 2015 and 2014, revenue and expenses of the Strategic Service Units were previously reported under Others. However, for comparability purposes, these revenues and expenses have been restated and are now allocated to Chile Operating segment.

These Operating segments mentioned are consistent with the way the Company is managed and how results are reported by CCU. These segments reflect separate operating results which are regularly reviewed by the chief operating decision maker in order to make decisions about the resources to be allocated to the segment and assess its performance.

Operating segment | Products and services
Chile | Beers, non-alcoholic beverages, spirits and SSU.
International Business | Beers, cider, non-alcoholic beverages and spirits in Argentina, Uruguay and Paraguay.
Wines | Wines, mainly in export markets to more 80 countries.

Corporate revenues and expenses are presented separately within the Other, in addition in the other presents the elimination of transactions between segments.

The Company does not have any customers representing more than 10% of consolidated revenues.

The detail of the segments is presented in the following tables.

F-43

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

a) Information as per operating segments for the years ended December 31, 2016 and 2015:

| Chile(4) | International Business | Wines | Others(4) | Total
| 2016 | 2015 | 2016 | 2015 | 2016 | 2015 | 2016 | 2015 | 2016 | 2015
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Sales revenue external customers | 973,220,715 | 885,769,609 | 366,778,056 | 400,051,022 | 195,322,270 | 184,169,165 | - | - | 1,535,321,041 | 1,469,989,796
Other income | 15,630,481 | 16,757,566 | 2,783,615 | 4,708,728 | 5,851,015 | 5,214,674 | (688,444) | 1,700,951 | 23,576,667 | 28,381,919
Sales revenue between segments | 8,524,493 | 6,932,905 | 546,972 | 953,967 | 228,767 | 131,209 | (9,300,232) | (8,018,081) | - | -
Net sales | 997,375,689 | 909,460,080 | 370,108,643 | 405,713,717 | 201,402,052 | 189,515,048 | (9,988,676) | (6,317,130) | 1,558,897,708 | 1,498,371,715
Change % | 9.7 | - | (8.8) | - | 6.3 | - | - | - | 4.0 | -
Cost of sales | (471,151,686) | (411,375,380) | (157,485,547) | (162,665,341) | (112,938,261) | (105,956,281) | (244,422) | (5,078,249) | (741,819,916) | (685,075,251)
% of Net sales | 47.2 | 45.2 | 42.6 | 40.1 | 56.1 | 55.9 | - | - | 47.6 | 45.7
Gross margin | 526,224,003 | 498,084,700 | 212,623,096 | 243,048,376 | 88,463,791 | 83,558,767 | (10,233,098) | (11,395,379) | 817,077,792 | 813,296,464
% of Net sales | 52.8 | 54.8 | 57.4 | 59.9 | 43.9 | 44.1 | - | - | 52.4 | 54.3
MSD&A (1) | (373,407,847) | (343,380,553) | (191,413,501) | (216,098,525) | (52,007,092) | (51,070,291) | (2,714,311) | (2,015,407) | (619,542,751) | (612,564,776)
% of Net sales | 37.4 | 37.8 | 51.7 | 53.3 | 25.8 | 26.9 | - | - | 39.7 | 40.9
Other operating income (expenses) | 1,734,871 | 626,889 | (394,820) | 3,315,892 | 732,689 | 44,823 | 1,043,939 | 217,706 | 3,116,679 | 4,205,310
Adjusted operating result (2) | 154,551,027 | 155,331,036 | 20,814,775 | 30,265,743 | 37,189,388 | 32,533,299 | (11,903,470) | (13,193,080) | 200,651,720 | 204,936,998
Change % | (0.5) | - | (31.2) | - | 14.3 | - | - | - | (2.1) | -
% of Net sales | 15.5 | 17.1 | 5.6 | 7.5 | 18.5 | 17.2 | - | - | 12.9 | 13.7
Net financial expense | - | - | - | - | - | - | - | - | (14,627,170) | (15,255,586)
Share of net loss of joint ventures and associates accounted for using | - | - | - | - | - | - | - | - | (5,560,522) | (5,228,135)
Foreign currency exchange differences | - | - | - | - | - | - | - | - | 456,995 | 957,565
Results as per adjustment units | - | - | - | - | - | - | - | - | (2,246,846) | (3,282,736)
Other gains (losses) | - | - | - | - | - | - | - | - | (8,345,907) | 8,512,000
Income before taxes | - | - | - | - | - | - | - | - | 170,328,270 | 190,640,106
Income taxes | - | - | - | - | - | - | - | - | (30,246,383) | (50,114,516)
Net income for year | - | - | - | - | - | - | - | - | 140,081,887 | 140,525,590
Non-controlling interests | - | - | - | - | - | - | - | - | 21,624,399 | 19,717,455
Net income attributable to equity holders of the parent | - | - | - | - | - | - | - | - | 118,457,488 | 120,808,135
Depreciation and amortization | 61,736,849 | 56,698,871 | 11,928,705 | 14,334,415 | 7,078,872 | 7,568,991 | 2,783,619 | 2,964,525 | 83,528,045 | 81,566,802
ORBDA (3) | 216,287,876 | 212,029,907 | 32,743,480 | 44,600,158 | 44,268,260 | 40,102,290 | (9,119,851) | (10,228,555) | 284,179,765 | 286,503,800
Change % | 2.0 | - | (26.6) | - | 10.4 | - | - | - | (0.8) | -
% of Net sales | 21.7 | 23.3 | 8.8 | 11.0 | 22.0 | 21.2 | - | - | 18.2 | 19.1

(1) MSD&A, included Marketing, Selling, Distribution and Administrative expenses.

(2) Adjusted operating result (for management purposes we have defined as Net income before other gains (losses), net financial expense, equity and income of joint venture, foreign currency exchange differences, result as per adjustment units and income taxes).

(3) ORBDA (for management purpose we have defined as Adjusted Operating Result before Depreciation and Amortization).

(4) Starting from the third quarter of 2016, the Company has incorporated in the Chile operating segment the business activities performed by the Strategic Service Units (SSU), which include Transportes CCU Limitada, Comercial CCU S.A., CRECCU S.A. and Fábrica de Envases Plásticos S.A. As of December 2015, the revenue and expenses of the Strategic Service Units were previously reported under Others. However for comparability purposes these revenues and expenses have been restated and are now reported under to Chile operating segment (see reconciliation in letter c) under this Note).

F-44

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

b) Information as per operating segments for the years ended December 31, 2015 and 2014:

| Chile (5) | International Business | Wines | Others (5) | Total
| 2015 | 2014 | 2015 | 2014 | 2015 | 2014 | 2015 | 2014 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Sales revenue external customers | 885,769,609 | 813,639,952 | 400,051,022 | 292,152,707 | 184,169,165 | 168,139,809 | - | - | 1,469,989,796 | 1,273,932,468
Other income | 16,757,566 | 15,562,980 | 4,708,728 | 3,992,902 | 5,214,674 | 3,918,028 | 1,700,951 | 559,921 | 28,381,919 | 24,033,831
Sales revenue between segments | 6,932,905 | 6,227,110 | 953,967 | 3,522,074 | 131,209 | 290,716 | (8,018,081) | (10,039,900) | - | -
Net sales | 909,460,080 | 835,430,042 | 405,713,717 | 299,667,683 | 189,515,048 | 172,348,553 | (6,317,130) | (9,479,979) | 1,498,371,715 | 1,297,966,299
Change % | 8.9 | - | 35.4 | - | 10.0 | - | - | - | 15.4 | -
Cost of sales | (411,375,380) | (374,336,312) | (162,665,341) | (136,174,602) | (105,956,281) | (97,523,600) | (5,078,249) | 3,497,698 | (685,075,251) | (604,536,816)
% of Net sales | 45.2 | 44.8 | 40.1 | 45.4 | 55.9 | 56.6 | - | - | 45.7 | 46.6
Gross margin | 498,084,700 | 461,093,730 | 243,048,376 | 163,493,081 | 83,558,767 | 74,824,953 | (11,395,379) | (5,982,281) | 813,296,464 | 693,429,484
% of Net sales | 54.8 | 55.2 | 59.9 | 54.6 | 44.1 | 43.4 | - | - | 54.3 | 53.4
MSD&A (1) | (343,380,553) | (328,766,178) | (216,098,525) | (154,299,739) | (51,070,291) | (50,284,131) | (2,015,407) | (2,252,954) | (612,564,776) | (535,603,002)
% of Net sales | 37.8 | 39.4 | 53.3 | 51.5 | 26.9 | 29.2 | - | - | 40.9 | 41.3
Other operating income (expenses) | 626,889 | 850,122 | 3,315,892 | 20,173,967 | 44,823 | 238,952 | 217,706 | 2,458,269 | 4,205,310 | 23,721,310
Adjusted operating result before Exceptional Items (EI) | 155,331,036 | 133,177,674 | 30,265,743 | 29,367,309 | 32,533,299 | 24,779,774 | (13,193,080) | (5,776,966) | 204,936,998 | 181,547,792
Change % | 16.6 | - | 3.1 | - | 31.3 | - | - | - | 12.9 | -
% of Net sales | 17.1 | 15.9 | 7.5 | 9.8 | 17.2 | 14.4 | - | - | 13.7 | 14.0
Exceptional Items (EI) (2) | - | (301,550) | - | (1,214,505) | - | - | - | (111,445) | - | (1,627,500)
Adjusted operating result (3) | 155,331,036 | 132,876,124 | 30,265,743 | 28,152,804 | 32,533,299 | 24,779,774 | (13,193,080) | (5,888,411) | 204,936,998 | 179,920,292
Change % | 16.9 | - | 7.5 | - | 31.3 | - | - | - | 13.9 | -
% of Net sales | 17.1 | 15.9 | 7.5 | 9.4 | 17.2 | 14.4 | - | - | 13.7 | 14
Net financial expense | - | - | - | - | - | - | - | - | (15,255,586) | (10,820,891)
Share of net loss of joint ventures and associates accounted for using | - | - | - | - | - | - | - | - | (5,228,135) | (898,607)
Foreign currency exchange differences | - | - | - | - | - | - | - | - | 957,565 | (613,181)
Results as per adjustment units | - | - | - | - | - | - | - | - | (3,282,736) | (4,159,131)
Other gains (losses) | - | - | - | - | - | - | - | - | 8,512,000 | 4,036,939
Income before taxes | - | - | - | - | - | - | - | - | 190,640,106 | 167,465,421
Income taxes | - | - | - | - | - | - | - | - | (50,114,516) | (46,673,500)
Net income for year | - | - | - | - | - | - | - | - | 140,525,590 | 120,791,921
Non-controlling interests | - | - | - | - | - | - | - | - | 19,717,455 | 14,553,471
Net income attributable to equity holders of the parent | - | - | - | - | - | - | - | - | 120,808,135 | 106,238,450
Depreciation and amortization | 56,698,871 | 48,459,588 | 14,334,415 | 11,194,117 | 7,568,991 | 7,115,790 | 2,964,525 | 1,838,071 | 81,566,802 | 68,607,566
ORBDA before EI | 212,029,907 | 181,637,262 | 44,600,158 | 40,561,426 | 40,102,290 | 31,895,564 | (10,228,555) | (3,938,895) | 286,503,800 | 250,155,358
ORBDA (4) | 212,029,907 | 181,335,712 | 44,600,158 | 39,346,921 | 40,102,290 | 31,895,564 | (10,228,555) | (4,050,340) | 286,503,800 | 248,527,858
Change % | 16.9 | - | 13.4 | - | 25.7 | - | - | - | 15.3 | -
% of Net sales | 23.3 | 21.7 | 11.0 | 13.1 | 21.2 | 18.5 | - | - | 19.1 | 19.1

(1) MSD&A, included Marketing, Selling, Distribution and Administrative expenses.

(2) Exceptional Items are income or expenses that do not occur regularly as part of the normal activities of the Company. It’s presented separately because its important items for the understanding the normal operations of the Company due to importance or nature.During the year 2014, the Company has considered this result as an Exceptional Items related to different restructuring process of operating segments.

(3) Adjusted operating result (for management purposes we have defined as Net income before other gains (losses), net financial expense, equity and income of joint venture, foreign currency exchange differences, result as per adjustment units and income taxes).

(4) ORBDA (for management purpose we have defined as Adjusted Operating Result before Depreciation and Amortization).

(5) Starting from the third quarter of 2016, the Company has incorporated in the Chile operating segment the business activities performed by the Strategic Service Units (SSU), which include Transportes CCU Limitada, Comercial CCU S.A., CRECCU S.A. and Fábrica de Envases Plásticos S.A. As of December 2015, the revenue and expenses of the Strategic Service Units were previously reported under Others. However for comparability purposes these revenues and expenses have been restated and are now reported under to Chile operating segment (see reconciliation in letter c) under this Note).

F-45

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

c) For the year ended December 31, 2015 and 2014, revenue and expenses of the Strategic Service Units were previously reported under Others. However, for comparability purposes, these revenues and expenses have been restated and are now allocated to Chile Operating segment explained in the following tables:

For the year ended as of December 31, 2015:

| Chile | Others
| 2015 | 2015
| Previously reported | Adjusted | Tight | Previously reported | Adjusted | Tight
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Sales revenue external customers | 885,769,609 | - | 885,769,609 | - | - | -
Other income | 10,238,408 | 6,519,158 | 16,757,566 | 8,220,109 | (6,519,158) | 1,700,951
Sales revenue between segments | 6,013,177 | 919,728 | 6,932,905 | (7,098,353) | (919,728) | (8,018,081)
Net sales | 902,021,194 | 7,438,886 | 909,460,080 | 1,121,756 | (7,438,886) | (6,317,130)
Cost of sales | (420,297,983) | 8,922,603 | (411,375,380) | 3,844,354 | (8,922,603) | (5,078,249)
% of Net sales | 46.6 | - | 45.2 | - | - | -
Gross margin | 481,723,211 | 16,361,489 | 498,084,700 | 4,966,110 | (16,361,489) | (11,395,379)
% of Net sales | 53.4 | - | 54.8 | - | - | -
MSD&A (1) | (328,488,527) | (14,892,026) | (343,380,553) | (16,907,433) | 14,892,026 | (2,015,407)
% of Net sales | 36.4 | - | 37.8 | - | - | -
Other operating income (expenses) | 688,920 | (62,031) | 626,889 | 155,675 | 62,031 | 217,706
Adjusted operating result (2) | 153,923,604 | 1,407,432 | 155,331,036 | (11,785,648) | (1,407,432) | (13,193,080)
% of Net sales | 17.1 | - | 17.1 | - | - | -
Net financial expense | - | - | - | - | - | -
Share of net loss of joint ventures and associates accounted for using | - | - | - | - | - | -
Foreign currency exchange differences | - | - | - | - | - | -
Results as per adjustment units | - | - | - | - | - | -
Other gains (losses) | - | - | - | - | - | -
Income before taxes | - | - | - | - | - | -
Net income for year | - | - | - | - | - | -
Net income attributable to equity holders of the parent | - | - | - | - | - | -
Depreciation and amortization | 45,766,393 | 10,932,478 | 56,698,871 | 13,897,003 | (10,932,478) | 2,964,525
ORBDA (3) | 199,689,997 | 12,339,910 | 212,029,907 | 2,111,355 | (12,339,910) | (10,228,555)
% of Net sales | 22.1 | - | 23.3 | - | - | -

See definition of (1), (2) and (3) in information as per Operating segment letter a).

F-46

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

For the year ended as of December 31, 2014:

| Chile | Others
| 2014 | 2014
| Previously reported | Adjusted | Tight | Previously reported | Adjusted | Tight
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Sales revenue external customers | 813,639,952 | - | 813,639,952 | - | - | -
Other income | 9,100,957 | 6,462,023 | 15,562,980 | 7,021,944 | (6,462,023) | 559,921
Sales revenue between segments | 7,600,483 | (1,373,373) | 6,227,110 | (11,413,273) | 1,373,373 | (10,039,900)
Net sales | 830,341,392 | 5,088,650 | 835,430,042 | (4,391,329) | (5,088,650) | (9,479,979)
Cost of sales | (383,558,625) | 9,222,313 | (374,336,312) | 12,720,013 | (9,222,315) | 3,497,698
% of Net sales | 46.2 | - | 44.8 | - | - | -
Gross margin | 446,782,767 | 14,310,963 | 461,093,730 | 8,328,684 | (14,310,965) | (5,982,281)
% of Net sales | 53.8 | - | 55.2 | - | - | -
MSD&A (1) | (317,765,236) | (11,000,942) | (328,766,178) | (13,253,897) | 11,000,943 | (2,252,954)
% of Net sales | 38.3 | 1 | 39.4 | - | - | -
Other operating income (expenses) | 722,478 | 127,644 | 850,122 | 2,585,913 | (127,644) | 2,458,269
Adjusted operating result before Exceptional Items (EI) | 25,561,470 | (2,954,119) | 22,607,351 | (3,624,700) | 2,954,118 | (670,582)
Change % | - | - | - | - | - | -
% of Net sales | 0.04 | - 0.56 | 0.04 | - 334.38 | - 0.56 | -
Exceptional Items (EI) (2) | - | (301,550) | (301,550) | (412,995) | 301,550 | (111,445)
Adjusted operating result (3) | 129,740,009 | 3,437,665 | 133,177,674 | (2,339,300) | (3,437,666) | (5,776,966)
% of Net sales | 15.6 | - | 15.9 | - | - | -
Net financial expense | - | - | - | - | - | -
Share of net loss of joint ventures and associates accounted for using | - | - | - | - | - | -
Foreign currency exchange differences | - | - | - | - | - | -
Results as per adjustment units | - | - | - | - | - | -
Other gains (losses) | - | - | - | - | - | -
Income before taxes | - | - | - | - | - | -
Income taxes | - | - | - | - | - | -
Net income for year | - | - | - | - | - | -
Non-controlling interests | - | - | - | - | - | -
Net income attributable to equity holders of the parent | - | - | - | - | - | -
Depreciation and amortization | 38,832,969 | 9,626,619 | 48,459,588 | 11,464,690 | (9,626,619) | 1,838,071
ORBDA before EI | 37,317,380 | (533,386) | 36,783,994 | (713,134) | 533,385 | (179,749)
Change % | - | - | - | - | - | -
% of Net sales | 0.06 | - 0.10 | 0.06 | - 65.79 | - 0.10 | -
ORBDA (4) | 168,572,978 | 12,762,734 | 181,335,712 | 8,712,395 | (12,762,735) | (4,050,340)
% of Net sales | 20.3 | - | 21.7 | - | - | -

See definition of (1), (2), (3) and (4) in information as per Operating segment letter b).

F-47

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Sales information by geographic location

Net sales per geographical location | For the years ended as of December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Chile (1) | 1,176,972,109 | 1,081,835,420 | 991,938,043
Argentina (2) | 329,585,488 | 366,886,701 | 264,631,403
Uruguay | 15,204,331 | 14,432,950 | 11,204,806
Paraguay | 37,135,780 | 35,216,644 | 30,192,047
Total | 1,558,897,708 | 1,498,371,715 | 1,297,966,299

(1) Includes net sales correspond to Corporate Support Unit and eliminations between geographical locations. Additionally, includes net sales made in Chile of the Wines Operating segment.

(2) Includes net sales made by the subisiaries Finca La Celia S.A. and Los Huemules SRL., registered under the Wines Operating segment and Chile Operating segment, respectively.

Sales information by customer

| For the years ended as of December 31,
Net Sales | 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$
Domestic sales | 1,429,152,068 | 1,374,282,584 | 1,188,231,333
Exports sales | 129,745,640 | 124,089,131 | 109,734,966
Total | 1,558,897,708 | 1,498,371,715 | 1,297,966,299

Sales information by product category

| For the years ended as of December 31,
Sales information by product category | 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$
Alcoholic business | 1,041,923,724 | 1,040,145,164 | 880,580,817
Non-alcoholic business | 493,397,317 | 429,844,632 | 393,351,650
Others (1) | 23,576,667 | 28,381,919 | 24,033,832
Total | 1,558,897,708 | 1,498,371,715 | 1,297,966,299

(1) Others consist mainly of sales of by-products and packaging including bottles, pallets, and glasses.

Depreciation and amortization as per operating segments

Property, plant and equipment depreciation and amortization of software | For the years ended as of December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Chile Operating segment | 61,736,849 | 56,698,871 | 38,832,969
International business Operating segment | 11,928,705 | 14,334,415 | 11,194,117
Wines Operating segment | 7,078,873 | 7,568,991 | 7,115,790
Others (1) | 2,783,619 | 2,964,525 | 11,464,690
Total | 83,528,046 | 81,566,802 | 68,607,566

(1) I ncludes depreciation and amortization corresponding to the Corporate Support Units.

F-48

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Cash flows Operating Segments

Cash flows Operating Segments |  | For the years ended as of December 31,
| 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$
Cash flows from (used in ) Operating activities |  | 190,014,348 | 219,510,872 | 173,621,663
Chile Operating segment |  | 152,862,350 | 49,531,088 | 27,943,224
International Business Operating segment |  | 13,065,093 | 31,975,494 | 10,070,867
Wines Operating segment |  | 32,949,789 | 30,926,463 | 31,523,287
Others (1) |  | (8,862,884) | 107,077,827 | 104,084,285
Cash flows from (used in ) Investing Activities |  | (155,007,390) | (165,810,169) | (238,970,139)
Chile Operating segment |  | (57,119,431) | (59,046,239) | (55,303,491)
International Business Operating segment |  | (40,032,866) | (26,457,885) | (31,118,042)
Wines Operating segment |  | (13,499,538) | (9,807,177) | (10,279,735)
Others (1) |  | (44,355,555) | (70,498,868) | (142,268,871)
Cash flows from (used in ) Financing Activities |  | (95,303,138) | (82,839,491) | (132,155,575)
Chile Operating segment |  | (90,636,820) | 21,923,989 | 17,907,244
International Business Operating segment |  | 18,577,556 | 3,431,139 | 23,525,276
Wines Operating segment |  | (18,841,106) | (19,061,949) | (10,447,305)
Others (1) |  | (4,402,768) | (89,132,670) | (163,140,790)

(1) Others includes Corporate Support Units, due to cahs flows are managed by CCU.

Capital expenditures as per operating segments

Capital expenditures (property, plant and equipment and software additions) |  | For the years ended as of December 31,
| 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$
Chile Operating segment |  | 53,809,780 | 43,771,262 | 53,895,523
International business Operating segment |  | 39,592,739 | 27,871,662 | 33,481,407
Wines Operating segment |  | 14,767,858 | 10,052,863 | 12,686,080
Others (1) |  | 20,713,048 | 50,035,135 | 130,017,142
Total |  | 128,883,425 | 131,730,922 | 230,080,152

(1) Others includes the capital investments corresponding to the Corporate Support Units.

Assets as per operating segments

Assets as per Operating segments | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
Chile Operating segment | 1,125,266,274 | 1,056,161,363
International business Operating segment | 259,002,220 | 256,319,478
Wines Operating segment | 316,965,318 | 308,288,465
Others (1) | 170,343,238 | 204,678,125
Total | 1,871,577,050 | 1,825,447,431

(1) I ncludes assets corresponding to the Corporate Support Units.

F-49

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Assets per geographic location

Assets per geographical location | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
Chile (1) | 1,600,077,453 | 1,557,641,691
Argentina (2) | 197,986,123 | 188,897,724
Uruguay | 27,327,545 | 25,703,157
Paraguay | 46,185,929 | 53,204,859
Total | 1,871,577,050 | 1,825,447,431

(1) Includes the assets corresponding to the Corporate Support Units and eliminations between geographic location. Additionally, includes part of Wines Operating segment and excludes its argentine subsidiary Finca La Celia S.A.

(2) Includes the assets of the subisiaries Finca La Celia S.A. and Los Huemules SRL., registered under the Wines Operating segment and Chile Operating segment, respectively.

Liabilites as per operating segments

Liabilities as per Operating segments | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
Chile Operating segment | 242,132,457 | 218,651,536
International business Operating segment | 100,994,174 | 97,680,139
Wines Operating segment | 104,147,109 | 102,780,420
Others (1) | 224,010,731 | 218,813,191
Total | 671,284,471 | 637,925,286

(1) O thers includes liabilites corresponding to the Corporate Support Units.

F-50

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Operating Segment’s additional information

The Consolidated Statement of Income classified according to the Company’s operations management is as follows:

CONSOLIDATED STATEMENT OF INCOME | Notes | For the years ended December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Sales revenue external customers |  | 1,535,321,041 | 1,469,989,796 | 1,273,932,468
Other income |  | 23,576,667 | 28,381,919 | 24,033,831
Net sales |  | 1,558,897,708 | 1,498,371,715 | 1,297,966,299
Change % |  | 4.0 | 15.4 | -
Cost of sales |  | (741,819,916) | (685,075,251) | (604,536,815)
% of Net sales |  | 47.6 | 45.7 | 46.6
Gross margin |  | 817,077,792 | 813,296,464 | 693,429,484
% of Net sales |  | 52.4 | 54.3 | 53.4
MSD&A (1) |  | (619,542,751) | (612,564,776) | (535,603,002)
% of Net sales |  | 39.7 | 40.9 | 41.3
Other operating income (expenses) |  | 3,116,679 | 4,205,310 | 23,721,310
Change % |  | (2.1) | 12.9 | -
Exceptional Items (EI) (2) |  | - | - | (1,627,500)
Adjusted operating result (3) |  | 200,651,720 | 204,936,998 | 179,920,292
Change % |  | (2.1) | 13.9 | -
% of Net sales |  | 12.9 | 13.7 | 13.9
Net financial expense | 10 | (14,627,170) | (15,255,586) | (10,820,890)
Share of net loss of joint ventures and associates accounted for using | 19 | (5,560,522) | (5,228,135) | (898,607)
Foreign currency exchange differences | 10 | 456,995 | 957,565 | (613,180)
Results as per adjustment units | 10 | (2,246,846) | (3,282,736) | (4,159,131)
Other gains (losses) | 12 | (8,345,907) | 8,512,000 | 4,036,939
Income before taxes |  | 170,328,270 | 190,640,106 | 167,465,421
Income taxes | 25 | (30,246,383) | (50,114,516) | (46,673,500)
Net income for year |  | 140,081,887 | 140,525,590 | 120,791,921
Non-controlling interests | 31 | 21,624,399 | 19,717,455 | 14,553,471
Net income attributable to equity holders of the parent |  | 118,457,488 | 120,808,135 | 106,238,450
Depreciation and amortization |  | 83,528,045 | 81,566,802 | 68,607,566
Change % |  | (0.8) | 14.5 | -
ORBDA (4) |  | 284,179,765 | 286,503,800 | 248,527,858
Change % |  | (0.8) | 15.3 | -
% of Net sales |  | 18.2 | 19.1 | 19.1

See definition of (1), (2), (3) and (4) in information as per Operating segment letter b).

F-51

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The following is a reconciliation of our Net income, the main comparable IFRS measure to Adjusted Operating Result for the years ended December 31, 2016, 2015 and 2014:

| For the years ended December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Net income of year | 140,081,887 | 140,525,590 | 120,791,921
Add (Subtract): |  |  |
Other gains (losses) | 8,345,907 | (8,512,000) | (4,036,939)
Financial Income | (5,680,068) | (7,845,743) | (12,136,591)
Financial costs | 20,307,238 | 23,101,329 | 22,957,482
Share of net loss of joint ventures and associates accounted for using the equity method | 5,560,522 | 5,228,135 | 898,607
Foreign currency exchange differences | (456,995) | (957,565) | 613,181
Result as per adjustment units | 2,246,846 | 3,282,736 | 4,159,131
Income taxes | 30,246,383 | 50,114,516 | 46,673,500
Adjusted Operating result | 200,651,720 | 204,936,998 | 179,920,292

Exceptional Item (EI) | - | - | 1,627,500
Adjusted Operating result before (EI) | 200,651,720 | 204,936,998 | 181,547,792
Depreciation and amortization | 83,528,045 | 81,566,802 | 68,607,566
ORBDA before (EI) | 284,179,765 | 286,503,800 | 250,155,358
Exceptional Item (EI) | - | - | (1,627,500)
ORBDA | 284,179,765 | 286,503,800 | 248,527,858

F-52

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The following is a reconciliation of the consolidated amounts presented for MSD&A with the comparable amounts presented on the face of our consolidated statement of income:

| For the years ended December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Consolidated statement of income |  |  |
Distribution costs | (270.835.822) | (277.599.722) | (240.848.630)
Administrative expenses | (155.322.295) | (128.135.799) | (110.014.716)
Other expenses by function | (195.412.109) | (209.201.189) | (188.109.562)
Other expenses included in ´Other expenses by function´ | 2.027.475 | 2.371.934 | 3.369.906
Total MSD&A | (619.542.751) | (612.564.776) | (535.603.002)

Segment information by joint ventures and associates

The Administration of the Company review the financial situation and operations result of the all of their joint ventures and associated that is described in Note 19.

#

# Note 8 Business Combinations

a) Bebidas del Paraguay S.A.

Year 2016 Acquisitions

On March 31, 2016, the susbsidiary Bebidas del Paraguay S.A. acquired 51% of the stock rights of Artisan SRL (Paraguayan company). The purpose of this company is the production and marketing of Sajonia brand beer. The amount of this transaction was ThCh$ 641,489 (equivalents to US$ 1,000,000). At the date of issuance of these consolidated financial statements the Company is in the process of assessing the fair values of acquisitions above mentioned, estimating preliminarily that the effects will not be significant, so it was recorded under Other non-financial assets (see Note 18).

It is expected that the acquisition of this company allows to transform the brand into a reference in the segment of craft beer, increases their productive capacities and distribution network, forming part of the portfolio brands of BdP. Acoording with the above mentioned, BdP begins to participate in the elaboration of beer, with its own brand and with great growth prospects.

b) Other acquisitions

On December 2015 and June 2016, The Company participates, thorough subsidiary Embotelladoras Chilenas Unidas S.A., in joint operations Bebidas Carozzi CCU SpA. and Promarca Internacional SpA., determining fair values as explained in Note 1, letter a) and d), respectively.

As of December 31, 2016, the Company has not made other business combinations.

F-53

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 9 Nature of cost and expense

Operational cost and expense grouped by natural classification are as follows:

| For the years ended as of December 31,
Costs and expenses by nature | 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$
Raw material cost | 540,692,964 | 485,391,583 | 433,749,832
Materials and maintenance expense | 47,102,582 | 43,093,939 | 38,678,842
Personnel expense (1) | 210,885,553 | 197,915,151 | 169,331,464
Transportation and distribution | 230,047,942 | 234,431,464 | 201,371,151
Advertising and promotion expense | 105,938,586 | 117,921,841 | 105,649,991
Lease expense | 16,294,896 | 13,641,122 | 13,347,091
Energy expense | 24,444,163 | 25,178,032 | 29,566,627
Depreciation and amortization | 83,528,045 | 81,566,802 | 68,607,566
Other expenses | 104,455,411 | 100,872,027 | 83,207,159
Total | 1,363,390,142 | 1,300,011,961 | 1,143,509,723

(1) See Note 30 Employee benefits.

# Note 10 Financial results

The financial income composition for the year ended as of December 31, 2016, 2015 y 2014, is as follows:

Financial Results | For the years ended as of December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Financial income | 5,680,068 | 7,845,743 | 12,136,591
Financial cost | (20,307,238) | (23,101,329) | (22,957,482)
Foreign currency exchange differences | 456,995 | 957,565 | (613,181)
Result as per adjustment units | (2,246,846) | (3,282,736) | (4,159,131)
Total | (16,417,021) | (17,580,757) | (15,593,203)

# Note 11 Other income by function

The detail of other income by function is as follows:

Other income by function | For the years ended as of December 31,
| 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$
Sales of fixed assets | 1,882,883 |  | 2,541,619 | 1,978,208
Lease | 382,934 |  | 245,285 | 364,388
Sales of glass | 549,787 |  | 672,203 | 836,098
Others | 2,328,550 |  | 3,118,137 | (1) 22,285,022
Total | 5,144,154 | 6,577,244 | 25,463,716

(1) Under this amount includes, the positive one-time effect compensations received by our Argentine subsidiary CICSA for an amount 227,245 thousands of Argentine pesos (equivalent to MUS$ 34,200), for the termination of the contract which allowed us to import and distribute on an exclusive basis, Corona and Negra Modelo beers in Argentina and the license for the production and distribution of Budweiser beer in Uruguay.

F-54

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 12 Other Gains (Losses)

The detail of other gains (losses) items is as follows:

Other gains (losses) | For the years ended as of December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Results derivative contracts (1) | (10,134,414) | 9,839,675 | 4,152,548
Marketable securities to fair value | 84,133 | 36,280 | (103,306)
Other | 1,704,374 | (1,363,955) | (12,303)
Total | (8,345,907) | 8,512,000 | 4,036,939

(1) Under this concept the Company received cash flows amounting ThCh$ 9,698,871, ThCh$ 5,419,700 and ThCh$ 927,149 corresponding to 2016, 2015 and 2014, respectevily and these were recorded in the Consolidated Cash Flow Statement, under Operational activities, in line item Other cash movements.

# Note 13 Cash and cash equivalent s

Cash and cash equivalent balances were as follows,

| As of December 31, 2016 | As of December 31, 2015 | As of December 31, 2014
| ThCh$ | ThCh$ | ThCh$
Cash | 106,203 | 12,712 | 12,708
Overnight deposits | 1,978,738 | 462,873 | 1,319,399
Bank balances | 41,276,555 | 42,370,367 | 30,853,126
Time deposits | 14,955,778 | 32,639,373 | 99,373,117
Investments in mutual funds | 24,772 | - | -
Securities purchased under resale agreements | 75,447,904 | 117,068,914 | 83,216,526
Total | 133,789,950 | 192,554,239 | 214,774,876

F-55

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The currency composition of cash and cash equivalents at December 31, 2016, is as follows:

| Chilean Peso | US Dollar | Euro | Argentine Peso | Uruguayan Peso | Paraguayan Guaraní | Others | Total
ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Cash | 100,921 | 788 | - | 4,494 | - | - | - | 106,203
Overnight deposits | - | 1,978,738 | - | - | - | - | - | 1,978,738
Bank balances | 27,164,331 | 6,258,367 | 786,887 | 2,158,115 | 1,136,782 | 3,269,045 | 503,028 | 41,276,555
Time deposits | 14,955,778 | - | - | - | - | - | - | 14,955,778
Investments in mutual funds | - | - | - | 24,772 | - | - | - | 24,772
Securities purchased under resale agreements | 75,447,904 | - | - | - | - | - | - | 75,447,904
Total | 117,668,934 | 8,237,893 | 786,887 | 2,187,381 | 1,136,782 | 3,269,045 | 503,028 | 133,789,950

The currency composition of cash and cash equivalents at December 31, 2015, is as follows:

| Chilean Peso | US Dollar | Euro | Argentine Peso | Uruguayan Peso | Paraguayan Guaraní | Others | Total
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Cash | 10,675 | 39 | - | 1,998 | - | - | - | 12,712
Overnight deposits | - | 462,873 | - | - | - | - | - | 462,873
Bank balances | 21,964,295 | 4,922,732 | 955,840 | 5,699,756 | 948,816 | 7,519,619 | 359,309 | 42,370,367
Time deposits | 32,639,373 | - | - | - | - | - | - | 32,639,373
Securities purchased under resale agreements | 117,068,914 | - | - | - | - | - | - | 117,068,914
Total | 171,683,257 | 5,385,644 | 955,840 | 5,701,754 | 948,816 | 7,519,619 | 359,309 | 192,554,239

The currency composition of cash and cash equivalents at December 31, 2014, is as follows:

| Chilean Peso | Unidad de Fomento | US Dollar | Euro | Argentine Peso | Uruguayan Peso | Paraguayan Guaraní | Others | Totales
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Cash | 9,939 | - | 420 | - | 2,349 | - | - | - | 12,708
Overnight deposits | - | - | 1,319,399 | - | - | - | - | - | 1,319,399
Bank balances | 8,790,934 | - | 4,738,935 | 974,179 | 11,726,073 | 536,097 | 3,753,420 | 333,488 | 30,853,126
Time deposits | 90,962,579 | 8,410,538 | - | - | - | - | - | - | 99,373,117
Investments in mutual funds | - | - | - | - | - | - | - | - | -
Securities purchased under resale agreements | 83,216,526 | - | - | - | - | - | - | - | 83,216,526
Totales | 182,979,978 | 8,410,538 | 6,058,754 | 974,179 | 11,728,422 | 536,097 | 3,753,420 | 333,488 | 214,774,876

F-56

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The composition of time deposits is as follows:

As of December 31, 2016:

Financial Institution | Issue date | Maturity date | Currency | Amount | Monthly interest rate (%)
ThCh$
Banco Santander | 12-27-2016 | 01-05-2017 | CLP | 1,250,550 | 0.33
Banco Santander | 12-28-2016 | 01-10-2017 | CLP | 2,400,792 | 0.33
Banco Santander | 12-29-2016 | 01-25-2017 | CLP | 5,701,292 | 0.34
Banco Consorcio | 12-28-2016 | 01-26-2017 | CLP | 5,401,782 | 0.33
Banco Francés | 12-12-2016 | 01-11-2017 | $ ARG | 201,362 | 1.60
Total |  |  |  | 14,955,778 |

As of December 31, 2015:

Financial Institution | Issue date | Maturity date | Currency | Amount | Monthly interest rate (%)
ThCh$
Banco Consorcio | 11-30-2015 | 01-06-2016 | CLP | 3,512,658 | 0.35
Banco Consorcio | 12-29-2015 | 01-20-2016 | CLP | 800,181 | 0.34
Banco Consorcio | 12-29-2015 | 01-25-2016 | CLP | 2,850,665 | 0.35
Banco Consorcio | 12-14-2015 | 01-12-2016 | CLP | 37,568 | 0.32
Banco Consorcio | 12-29-2015 | 01-29-2016 | CLP | 2,500,600 | 0.36
Banco Consorcio | 12-21-2015 | 01-20-2016 | CLP | 460,521 | 0.34
Banco de Crédito e Inversiones | 12-15-2015 | 01-08-2016 | CLP | 7,762,889 | 0.33
Banco Santander | 12-21-2015 | 01-20-2016 | CLP | 6,407,467 | 0.35
Banco Santander | 12-23-2015 | 01-20-2016 | CLP | 1,251,133 | 0.34
Banco Santander | 12-24-2015 | 01-11-2016 | CLP | 1,651,271 | 0.33
Banco Santander | 12-28-2015 | 01-25-2016 | CLP | 3,301,122 | 0.34
HSBC Bank Chile | 12-17-2015 | 01-14-2016 | CLP | 2,103,298 | 0.33
Total |  |  |  | 32,639,373 |

F-57

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

As of December 31, 2014

Financial Institution | Issue date | Maturity date | Currency | Amount | Monthly interest rate (%)
ThCh$
Banco Consorcio | 11-25-2014 | 01-09-2015 | CLP | 5,018,600 | 0.31
Banco Consorcio | 12-24-2014 | 01-19-2015 | CLP | 4,002,707 | 0.29
Banco Consorcio | 12-22-2014 | 01-20-2015 | CLP | 230,186 | 0.27
Banco Consorcio | 12-22-2014 | 01-20-2015 | CLP | 700,588 | 0.28
Banco de Chile | 11-06-2014 | 02-05-2015 | CLP | 3,016,500 | 0.30
Banco de Chile | 11-25-2014 | 01-09-2015 | CLP | 8,430,240 | 0.30
Banco de Chile | 12-11-2014 | 01-12-2015 | CLP | 2,054,168 | 0.31
Banco de Chile | 12-26-2014 | 02-10-2015 | CLP | 2,001,000 | 0.30
Banco de Chile | 12-30-2014 | 02-10-2015 | CLP | 3,000,300 | 0.30
Banco de Chile | 11-06-2014 | 02-05-2015 | UF | 3,039,750 | 1.60
Banco de Crédito e Inversiones | 10-28-2014 | 01-08-2015 | CLP | 3,472,080 | 0.30
Banco de Crédito e Inversiones | 12-16-2014 | 01-23-2015 | CLP | 8,011,600 | 0.29
Banco de Crédito e Inversiones | 10-15-2014 | 01-08-2015 | CLP | 10,079,567 | 0.31
Banco de Crédito e Inversiones | 12-26-2014 | 02-10-2015 | CLP | 2,301,073 | 0.28
Banco Internacional | 12-16-2014 | 01-23-2015 | CLP | 3,005,700 | 0.38
Banco Itaú | 10-29-2014 | 01-27-2015 | CLP | 5,331,387 | 0.28
Banco Santander | 11-20-2014 | 01-08-2015 | CLP | 4,518,450 | 0.30
Banco Santander | 11-28-2014 | 01-15-2015 | CLP | 5,618,480 | 0.30
Banco Santander | 12-03-2014 | 01-08-2015 | CLP | 2,306,440 | 0.30
Banco Santander | 12-24-2014 | 01-19-2015 | CLP | 4,703,180 | 0.29
Banco Santander | 12-26-2014 | 02-10-2015 | CLP | 4,002,000 | 0.30
Banco Santander | 12-30-2014 | 02-10-2015 | CLP | 2,100,203 | 0.29
Banco Santander | 12-03-2014 | 01-08-2015 | CLP | 150,420 | 0.30
Banco Santander | 12-11-2014 | 01-07-2015 | CLP | 1,803,360 | 0.28
Banco Security | 12-22-2014 | 01-23-2015 | CLP | 2,702,430 | 0.30
Banco Security | 12-23-2014 | 01-30-2015 | CLP | 2,401,920 | 0.30
BancoEstado | 10-29-2014 | 01-27-2015 | UF | 5,370,788 | 0.28
Total |  |  |  | 99,373,117 |

F-58

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The composition of Securities purchased under resale agreements is as follows:

As of December 31, 2016:

Financial Institution | Securities purchased (*) | Issue date | Maturity date | Currency | Amount | Monthly interest rate (%)
ThCh$
BanChile Corredores de Bolsa S.A. | Banco de Chile | 12-28-2016 | 01-04-2017 | CLP | 3,531,124 | 0.32
BanChile Corredores de Bolsa S.A. | BancoEstado | 12-28-2016 | 01-04-2017 | CLP | 3,602,675 | 0.32
BanChile Corredores de Bolsa S.A. | Scotiabank Sudamericano | 12-28-2016 | 01-04-2017 | CLP | 2,044,419 | 0.32
BanChile Corredores de Bolsa S.A. | Banco Santander | 12-28-2016 | 01-04-2017 | CLP | 674,935 | 0.32
BanChile Corredores de Bolsa S.A. | Banco de Chile | 12-28-2016 | 01-06-2017 | CLP | 1,679,525 | 0.32
BanChile Corredores de Bolsa S.A. | BancoEstado | 12-28-2016 | 01-06-2017 | CLP | 1,205,429 | 0.32
BanChile Corredores de Bolsa S.A. | Scotiabank Sudamericano | 12-28-2016 | 01-06-2017 | CLP | 1,116,326 | 0.32
BanChile Corredores de Bolsa S.A. | Banco de Chile | 12-29-2016 | 01-06-2017 | CLP | 1,427,025 | 0.31
BanChile Corredores de Bolsa S.A. | BancoEstado | 12-29-2016 | 01-06-2017 | CLP | 1,725,807 | 0.31
BanChile Corredores de Bolsa S.A. | Scotiabank Sudamericano | 12-29-2016 | 01-06-2017 | CLP | 5,799,890 | 0.31
BanChile Corredores de Bolsa S.A. | Banco de Crédito e Inversiones | 12-29-2016 | 01-06-2017 | CLP | 1,549,449 | 0.31
BancoEstado S.A. Corredores de Bolsa | Scotiabank Sudamericano | 12-29-2016 | 01-06-2017 | CLP | 3,916,539 | 0.33
BancoEstado S.A. Corredores de Bolsa | Banco Itaú | 12-29-2016 | 01-06-2017 | CLP | 6,085,662 | 0.33
BancoEstado S.A. Corredores de Bolsa | BancoEstado | 12-29-2016 | 01-10-2017 | CLP | 2,400,528 | 0.33
BancoEstado S.A. Corredores de Bolsa | Banco de Crédito e Inversiones | 12-29-2016 | 01-10-2017 | CLP | 6,019,097 | 0.33
BancoEstado S.A. Corredores de Bolsa | BBVA Chile | 12-29-2016 | 01-10-2017 | CLP | 3,933,092 | 0.33
BancoEstado S.A. Corredores de Bolsa | BancoEstado | 12-30-2016 | 01-10-2017 | CLP | 1,600,149 | 0.28
BancoEstado S.A. Corredores de Bolsa | Banco Itaú | 12-30-2016 | 01-10-2017 | CLP | 3,000,280 | 0.28
BancoEstado S.A. Corredores de Bolsa | BBVA Chile | 12-29-2016 | 01-10-2017 | CLP | 1,350,297 | 0.33
BancoEstado S.A. Corredores de Bolsa | Banco BICE | 12-29-2016 | 01-05-2017 | CLP | 105,017 | 0.33
BancoEstado S.A. Corredores de Bolsa | Banco de Chile | 12-29-2016 | 01-10-2017 | CLP | 500,110 | 0.33
BancoEstado S.A. Corredores de Bolsa | Banco Santander | 12-29-2016 | 01-10-2017 | CLP | 3,500,770 | 0.33
BancoEstado S.A. Corredores de Bolsa | Banco de Chile | 12-29-2016 | 01-16-2017 | CLP | 4,000,880 | 0.33
BancoEstado S.A. Corredores de Bolsa | Banco de Chile | 12-29-2016 | 01-20-2017 | CLP | 1,917,467 | 0.33
BancoEstado S.A. Corredores de Bolsa | BBVA Chile | 12-29-2016 | 01-20-2017 | CLP | 82,974 | 0.33
BancoEstado S.A. Corredores de Bolsa | Banco de Chile | 12-29-2016 | 01-03-2017 | CLP | 250,055 | 0.33
BancoEstado S.A. Corredores de Bolsa | BancoEstado | 12-29-2016 | 01-05-2017 | CLP | 6,101,342 | 0.33
BancoEstado S.A. Corredores de Bolsa | Banco de Crédito e Inversiones | 12-27-2016 | 01-03-2017 | CLP | 925,383 | 0.31
BancoEstado S.A. Corredores de Bolsa | BBVA Chile | 12-29-2016 | 01-05-2017 | CLP | 725,160 | 0.33
BanChile Corredores de Bolsa S.A. | Banco de Chile | 12-28-2016 | 01-16-2017 | CLP | 872,178 | 0.32
BanChile Corredores de Bolsa S.A. | BancoEstado | 12-28-2016 | 01-16-2017 | CLP | 435,612 | 0.32
BanChile Corredores de Bolsa S.A. | Scotiabank Sudamericano | 12-28-2016 | 01-16-2017 | CLP | 1,865,909 | 0.32
BanChile Corredores de Bolsa S.A. | Banco de Crédito e Inversiones | 12-28-2016 | 01-16-2017 | CLP | 1,241,355 | 0.32
BanChile Corredores de Bolsa S.A. | Banco Santander | 12-28-2016 | 01-16-2017 | CLP | 261,444 | 0.32
Total |  |  |  |  | 75,447,904 |

(*) All financial instruments acquired under resale agreements, correspond to time deposits and are subject to a fixed interest rate.

F-59

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

As of December 31, 2015:

Financial Institution | Securities purchased (*) | Issue date | Maturity date | Currency | Amount | Monthly interest rate (%)
ThCh$
BanChile Corredores de Bolsa S.A. | Banco de Chile | 12-24-2015 | 01-08-2016 | CLP | 3,731,991 | 0.32
BanChile Corredores de Bolsa S.A. | Banco de Chile | 12-28-2015 | 01-08-2016 | CLP | 4,253,623 | 0.31
BanChile Corredores de Bolsa S.A. | Banco de Chile | 12-28-2015 | 01-20-2016 | CLP | 19,557 | 0.30
BanChile Corredores de Bolsa S.A. | Banco de Crédito e Inversiones | 12-28-2015 | 01-08-2016 | CLP | 8,828,519 | 0.31
BanChile Corredores de Bolsa S.A. | BancoEstado | 12-24-2015 | 01-08-2016 | CLP | 4,674,281 | 0.32
BanChile Corredores de Bolsa S.A. | BancoEstado | 12-28-2015 | 01-08-2016 | CLP | 3,923,128 | 0.31
BanChile Corredores de Bolsa S.A. | BancoEstado | 12-28-2015 | 01-20-2016 | CLP | 449 | 0.30
BancoEstado S.A. Corredores de Bolsa | Banco BICE | 12-29-2015 | 01-14-2016 | CLP | 980,345 | 0.32
BancoEstado S.A. Corredores de Bolsa | Banco de Chile | 12-28-2015 | 01-04-2016 | CLP | 4,693,648 | 0.31
BancoEstado S.A. Corredores de Bolsa | Banco de Chile | 12-29-2015 | 01-08-2016 | CLP | 7,565,908 | 0.32
BancoEstado S.A. Corredores de Bolsa | Banco de Chile | 12-29-2015 | 01-14-2016 | CLP | 4,219,808 | 0.32
BancoEstado S.A. Corredores de Bolsa | Banco de Crédito e Inversiones | 12-28-2015 | 01-04-2016 | CLP | 3,999,302 | 0.31
BancoEstado S.A. Corredores de Bolsa | Banco Itaú | 12-30-2015 | 01-07-2016 | CLP | 200,021 | 0.31
BancoEstado S.A. Corredores de Bolsa | Banco Itaú | 12-30-2015 | 01-14-2016 | CLP | 2,749,535 | 0.31
BancoEstado S.A. Corredores de Bolsa | Banco Itaú | 12-30-2015 | 01-14-2016 | CLP | 750,078 | 0.31
BancoEstado S.A. Corredores de Bolsa | Banco Itaú | 12-28-2015 | 01-07-2016 | CLP | 2,600,806 | 0.31
BancoEstado S.A. Corredores de Bolsa | Banco Itaú | 12-29-2015 | 01-01-2016 | CLP | 1,300,277 | 0.32
BancoEstado S.A. Corredores de Bolsa | Banco Santander | 12-29-2015 | 01-14-2016 | CLP | 3,079,945 | 0.32
BancoEstado S.A. Corredores de Bolsa | Banco Security | 12-28-2015 | 01-04-2016 | CLP | 5,779,339 | 0.31
BancoEstado S.A. Corredores de Bolsa | Banco Security | 12-29-2015 | 01-08-2016 | CLP | 241,899 | 0.32
BancoEstado S.A. Corredores de Bolsa | Banco Security | 12-29-2015 | 01-14-2016 | CLP | 1,919,498 | 0.32
BancoEstado S.A. Corredores de Bolsa | BancoEstado | 12-28-2015 | 01-04-2016 | CLP | 4,837,882 | 0.31
BancoEstado S.A. Corredores de Bolsa | BancoEstado | 12-29-2015 | 01-08-2016 | CLP | 140,839 | 0.32
BancoEstado S.A. Corredores de Bolsa | BancoEstado | 12-29-2015 | 01-14-2016 | CLP | 10,702,283 | 0.32
BancoEstado S.A. Corredores de Bolsa | BancoEstado | 12-23-2015 | 01-12-2016 | CLP | 195,156 | 0.30
BancoEstado S.A. Corredores de Bolsa | BBVA Chile | 12-28-2015 | 01-04-2016 | CLP | 1,003,626 | 0.31
BancoEstado S.A. Corredores de Bolsa | BBVA Chile | 12-29-2015 | 01-08-2016 | CLP | 353,294 | 0.32
BancoEstado S.A. Corredores de Bolsa | BBVA Chile | 12-30-2015 | 01-14-2016 | CLP | 9,801,762 | 0.31
BancoEstado S.A. Corredores de Bolsa | Scotiabank Sudamericano | 12-29-2015 | 01-14-2016 | CLP | 652,718 | 0.32
BancoEstado S.A. Corredores de Bolsa | Scotiabank Sudamericano | 12-28-2015 | 01-04-2016 | CLP | 2,443,254 | 0.31
BancoEstado S.A. Corredores de Bolsa | BancoEstado | 12-29-2015 | 01-08-2016 | CLP | 800,000 | 0.32
BBVA Corredores de Bolsa S.A. | BBVA Chile | 12-22-2015 | 01-11-2016 | CLP | 350,326 | 0.31
Valores Security S.A. C. de B. | Banco BICE | 12-22-2015 | 01-07-2016 | CLP | 110,651 | 0.34
Valores Security S.A. C. de B. | Banco Central de Chile | 12-28-2015 | 01-04-2016 | CLP | 4,856,917 | 0.32
Valores Security S.A. C. de B. | Banco Central de Chile | 11-30-2015 | 01-06-2016 | CLP | 4,053,610 | 0.34
Valores Security S.A. C. de B. | Banco Consorcio | 12-28-2015 | 01-04-2016 | CLP | 24,999 | 0.32
Valores Security S.A. C. de B. | Banco de Crédito e Inversiones | 12-28-2015 | 01-04-2016 | CLP | 119,401 | 0.32
Valores Security S.A. C. de B. | Banco Itaú | 12-28-2015 | 01-04-2016 | CLP | 4,234,301 | 0.32
Valores Security S.A. C. de B. | Banco Security | 11-30-2015 | 01-06-2016 | CLP | 1,725,673 | 0.34
Valores Security S.A. C. de B. | Banco Security | 12-28-2015 | 01-04-2016 | CLP | 2,707,819 | 0.32
Valores Security S.A. C. de B. | Banco Security | 12-22-2015 | 01-07-2016 | CLP | 14,478 | 0.34
Valores Security S.A. C. de B. | BancoEstado | 11-30-2015 | 01-06-2016 | CLP | 241,798 | 0.34
Valores Security S.A. C. de B. | BancoEstado | 12-28-2015 | 01-04-2016 | CLP | 401,100 | 0.32
Valores Security S.A. C. de B. | BancoEstado | 12-22-2015 | 01-07-2016 | CLP | 125,126 | 0.34
Valores Security S.A. C. de B. | BBVA Chile | 12-28-2015 | 01-04-2016 | CLP | 1,659,944 | 0.32
Total |  |  |  |  | 117,068,914 |

(*) All financial instruments acquired under resale agreements, correspond to time deposits and are subject to a fixed interest rate.

F-60

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

As of December 31, 2014:

Financial Institution | Securities purchased (*) | Issue date | Maturity date | Currency | Amount | Monthly interest rate (%)
ThCh$
BanChile Corredores de Bolsa S.A. | Banco de Chile | 12-16-2014 | 01-15-2015 | CLP | 3,004,500 | 0.30
BanChile Corredores de Bolsa S.A. | Banco de Chile | 12-16-2014 | 01-20-2015 | CLP | 10,015,000 | 0.30
BanChile Corredores de Bolsa S.A. | Banco de Chile | 12-17-2014 | 01-09-2015 | CLP | 2,002,613 | 0.28
BanChile Corredores de Bolsa S.A. | Banco Santander | 12-16-2014 | 01-15-2015 | CLP | 8,012,000 | 0.30
BanChile Corredores de Bolsa S.A. | Banco Santander | 12-17-2014 | 01-09-2015 | CLP | 2,002,613 | 0.28
BanChile Corredores de Bolsa S.A. | Scotiabank Sudamericano | 12-17-2014 | 01-09-2015 | CLP | 1,001,307 | 0.28
BanChile Corredores de Bolsa S.A. | Scotiabank Sudamericano | 12-22-2014 | 01-23-2015 | CLP | 1,401,176 | 0.28
BanChile Corredores de Bolsa S.A. | Scotiabank Sudamericano | 12-16-2014 | 01-15-2015 | CLP | 4,006,000 | 0.30
Banco Estado S.A. Corredores de Bolsa | BancoEstado | 12-17-2014 | 01-08-2015 | CLP | 600,784 | 0.28
Banco Estado S.A. Corredores de Bolsa | BancoEstado | 12-19-2014 | 01-08-2015 | CLP | 250,280 | 0.28
Banco Estado S.A. Corredores de Bolsa | BancoEstado | 12-26-2014 | 01-08-2015 | CLP | 2,501,167 | 0.28
Banco Estado S.A. Corredores de Bolsa | BancoEstado | 12-30-2014 | 01-20-2015 | CLP | 2,250,203 | 0.27
Banco Estado S.A. Corredores de Bolsa | BancoEstado | 12-24-2014 | 01-08-2015 | CLP | 2,001,307 | 0.28
Banco Estado S.A. Corredores de Bolsa | BancoEstado | 12-23-2014 | 01-06-2015 | CLP | 450,336 | 0.28
Banco Estado S.A. Corredores de Bolsa | BancoEstado | 12-29-2014 | 01-08-2015 | CLP | 650,122 | 0.28
BBVA Corredores de Bolsa Ltda. | BBVA Banco Bhif | 12-29-2014 | 01-22-2015 | CLP | 2,900,561 | 0.29
BBVA Corredores de Bolsa Ltda. | BBVA Banco Bhif | 12-30-2014 | 02-10-2015 | CLP | 5,000,483 | 0.29
BBVA Corredores de Bolsa Ltda. | BBVA Banco Bhif | 12-15-2014 | 01-08-2015 | CLP | 2,604,021 | 0.29
BBVA Corredores de Bolsa Ltda. | BBVA Banco Bhif | 12-16-2014 | 01-08-2015 | CLP | 1,101,595 | 0.29
BBVA Corredores de Bolsa Ltda. | BBVA Banco Bhif | 12-17-2014 | 01-08-2015 | CLP | 250,338 | 0.29
BBVA Corredores de Bolsa Ltda. | BBVA Banco Bhif | 12-18-2014 | 01-08-2015 | CLP | 1,301,634 | 0.29
BBVA Corredores de Bolsa Ltda. | BBVA Banco Bhif | 12-22-2014 | 01-08-2015 | CLP | 550,479 | 0.29
BBVA Corredores de Bolsa Ltda. | BBVA Banco Bhif | 12-23-2014 | 01-08-2015 | CLP | 1,100,851 | 0.29
Valores Security S.A. C. de B. | Banco BICE | 11-26-2014 | 01-08-2015 | CLP | 87,863 | 0.31
Valores Security S.A. C. de B. | Banco BICE | 12-17-2014 | 01-23-2015 | CLP | 484,241 | 0.28
Valores Security S.A. C. de B. | Banco BICE | 12-29-2014 | 01-06-2015 | CLP | 2,920,853 | 0.29
Valores Security S.A. C. de B. | Banco Central de Chile | 11-18-2014 | 01-07-2015 | CLP | 288,293 | 0.29
Valores Security S.A. C. de B. | Banco Central de Chile | 12-01-2014 | 01-20-2015 | CLP | 1,246,441 | 0.31
Valores Security S.A. C. de B. | Banco Central de Chile | 12-17-2014 | 01-23-2015 | CLP | 28,349 | 0.28
Valores Security S.A. C. de B. | Banco Central de Chile | 11-26-2014 | 01-08-2015 | CLP | 1,166,177 | 0.31
Valores Security S.A. C. de B. | Banco Central de Chile | 12-29-2014 | 01-08-2015 | CLP | 1,000,193 | 0.29
Valores Security S.A. C. de B. | Banco Consorcio | 12-29-2014 | 01-15-2015 | CLP | 100,759 | 0.28
Valores Security S.A. C. de B. | Banco Consorcio | 12-29-2014 | 01-06-2015 | CLP | 400,077 | 0.29
Valores Security S.A. C. de B. | Banco de Crédito e Inversiones | 11-18-2014 | 01-07-2015 | CLP | 886,510 | 0.29
Valores Security S.A. C. de B. | Banco Itaú | 11-18-2014 | 01-07-2015 | CLP | 1,037,652 | 0.29
Valores Security S.A. C. de B. | Banco Itaú | 11-26-2014 | 01-08-2015 | CLP | 174,866 | 0.31
Valores Security S.A. C. de B. | Banco Itaú | 12-01-2014 | 01-20-2015 | CLP | 418,344 | 0.31
Valores Security S.A. C. de B. | Banco Itaú | 12-17-2014 | 01-23-2015 | CLP | 1,512,069 | 0.28
Valores Security S.A. C. de B. | Banco Itaú | 12-29-2014 | 01-15-2015 | CLP | 788,389 | 0.28
Valores Security S.A. C. de B. | Banco Santander | 12-01-2014 | 01-20-2015 | CLP | 413,433 | 0.31
Valores Security S.A. C. de B. | Banco Security | 11-18-2014 | 01-07-2015 | CLP | 3,839,782 | 0.29
Valores Security S.A. C. de B. | Banco Security | 11-26-2014 | 01-08-2015 | CLP | 1,180,497 | 0.31
Valores Security S.A. C. de B. | Banco Security | 12-01-2014 | 01-20-2015 | CLP | 630,151 | 0.31
Valores Security S.A. C. de B. | Banco Security | 12-17-2014 | 01-23-2015 | CLP | 3,998,068 | 0.28
Valores Security S.A. C. de B. | Banco Security | 12-29-2014 | 01-15-2015 | CLP | 1,318,189 | 0.28
Valores Security S.A. C. de B. | Banco Security | 12-29-2014 | 01-06-2015 | CLP | 577,769 | 0.29
Valores Security S.A. C. de B. | BancoEstado | 11-18-2014 | 01-07-2015 | CLP | 976,860 | 0.29
Valores Security S.A. C. de B. | BancoEstado | 12-17-2014 | 01-23-2015 | CLP | 47,422 | 0.28
Valores Security S.A. C. de B. | BBVA Banco Bhif | 12-17-2014 | 01-23-2015 | CLP | 438,345 | 0.28
Valores Security S.A. C. de B. | BBVA Banco Bhif | 12-29-2014 | 01-15-2015 | CLP | 469,734 | 0.28
Valores Security S.A. C. de B. | BBVA Banco Bhif | 12-29-2014 | 01-06-2015 | CLP | 1,102,267 | 0.29
Valores Security S.A. C. de B. | Scotiabank Sudamericano | 12-29-2014 | 01-15-2015 | CLP | 723,563 | 0.28
Total |  |  |  |  | 83,216,526 |

(*) All financial instruments acquired under resale agreements, correspond to time deposits and are subject to a fixed interest rate.

F-61

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The total accumulated cash flows paid in business combinations and acquisitions of associates are as follows:

|  | For the years ended as of December 31,
| 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$
Total disbursement per business acquisition |  |  |  |
Cash flow used in the purchase of non-controling interests (1) |  | 2,174,370 | 1,921,245 | 13,776,885
Other cahs payment to acquire interests in joint ventures (2) |  | 27,043,481 | 42,163,032 | 1,445,478
Cahs flow used for control of subsidiaries or other business (3) |  | 19,111,686 | - | -
Payment for changes in ownership interests in subidiaries (4) |  | 641,489 | - | 8,369
Total |  | 48,971,026 | 44,084,277 | 15,230,732

(1) Corresponds to an increased of capital made in 2016 and 2015 and the acquisitions made during 2014 of Bebidas Bolivianas BBO S.A. (see Note 19).

(2) Corresponds to an increased of capital made in 2016, 2015 and 2014 of Central Cervecera de Colombia S.A.S. (see Note 19) and to the amount paid in proportion to the creation of the company Promarca Internacional SpA. (See Note 1, letter a)). In 2015 corrsponds to the payment of 50% of the acquisitions of Bebidas Carozzi CCU SpA. (see Note 1).

(3) Corresponds to acquisition of additional interests in Manantial S.A. through its subsidiaries Aguas CCU-Nestlé Chile S.A. and Embotelladoras Chilenas Unidas S.A. (see Note 1, point (1)).

(4) In 2016 corresponds to the payment for ownership on Artisan SRL (Paraguay) (see Note 8, letter a)).

# Note 14 Accounts receivables – Trade and other receivables

The accounts receivables – trade and other receivables were as follows:

| As of December 31, 2016 | As of December 31, 2015
| Current | Non current | Current | Non current
| ThCh$ | ThCh$ | ThCh$ | ThCh$
Accounts receivables: |  |  |  |
Chile Operating segment (1) | 145,670,490 | - | 136,203,740 | -
International business Operating segment | 63,600,881 | - | 52,591,935 | -
Wines Operating segment | 42,958,093 | - | 43,333,189 | -
Others accounts receivables (2) | 32,375,234 | 3,563,797 | 24,033,944 | -
Impairment loss estimate | (3,837,914) | - | (3,936,871) | -
Total | 280,766,784 | 3,563,797 | 252,225,937 | -

(1) From the third quarter of 2016 onwards, the Chile Operating segment incorporated in their management the business activities performed by the Strategic Service Units (SSU), which include Transportes CCU Limitada, Comercial CCU S.A., CRECCU S.A. and Fábrica de Envases Plásticos S.A. As of December 2015, the account receivables of the Strategic Service Units were disclosed under item Others for an amount of ThCh$ 47,871,339, however for comparability purposes these account receivable have been reclassifficated to the Chile Operating segment.

(2) As of December 31, 2016, this item mainly includes ThCh$ 526,959 in short-term and ThCh$ 2,898,277 in long-term related to de account receivable to the sale of 49% that subsidiriary CPCh maintained in Compañía Pisquera Bauzá S.A. (see Note 24).

The Company’s accounts receivable are denominated in the following currencies:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Chilean Peso | 179,896,747 | 158,757,937
Argentine Peso | 56,773,947 | 48,535,814
US Dollar | 24,449,473 | 25,498,590
Euro | 7,025,446 | 7,463,166
Unidad de Fomento | 3,613,395 | 7,102
Uruguayan Pesos | 5,304,719 | 4,074,908
Paraguayan Guaraní | 6,010,193 | 6,111,636
Others currencies | 1,256,661 | 1,776,784
Total | 284,330,581 | 252,225,937

F-62

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The detail of the accounts receivable maturities as of December 31, 2016, is as follows:

| Total | Current balance | Overdue balances
0 a 3 months | 3 a 6 months | 6 a 12 months | More than 12 months
ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Accounts receivables: |  |  |  |  |  |
Chile Operating segment | 145,670,490 | 134,545,838 | 8,090,616 | 1,136,211 | 638,417 | 1,259,408
International business Operating segment | 63,600,881 | 55,230,423 | 7,521,071 | 130,299 | 275,300 | 443,788
Wines reportable Operating segment | 42,958,093 | 39,499,120 | 3,028,707 | 208,628 | 137,671 | 83,967
Others accounts receivables | 32,375,234 | 31,897,595 | 186,213 | 291,426 | - | -
Sub Total | 284,604,698 | 261,172,976 | 18,826,607 | 1,766,564 | 1,051,388 | 1,787,163
Impairment loss estimate | (3,837,914) | - | (1,130,545) | (478,707) | (542,389) | (1,686,273)
Total current | 280,766,784 | 261,172,976 | 17,696,062 | 1,287,857 | 508,999 | 100,890
Others accounts receivables | 3,563,797 | 3,563,797 | - | - | - | -
Total non-current | 3,563,797 | 3,563,797 | - | - | - | -

The detail of the accounts receivable maturities as of December 31, 2015, is as follows:

| Total | Current balance | Overdue balances
| 0 a 3 months | 3 a 6 months | 6 a 12 months | More than 12 months
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Accounts receivables: |  |  |  |  |  |
Chile Operating segment | 136,203,740 | 124,024,627 | 10,108,821 | 659,670 | 511,993 | 898,629
International business Operating segment | 52,591,935 | 45,600,898 | 5,839,178 | 226,648 | 321,512 | 603,699
Wines reportable Operating segment | 43,333,189 | 40,022,791 | 2,715,939 | 193,781 | 299,921 | 100,757
Others accounts receivables | 24,033,944 | 22,204,897 | 370,715 | 982,963 | 475,369 | -
Sub Total | 256,162,808 | 231,853,213 | 19,034,653 | 2,063,062 | 1,608,795 | 1,603,085
Impairment loss estimate | (3,936,871) | - | (888,274) | (280,839) | (1,168,592) | (1,599,166)
Total | 252,225,937 | 231,853,213 | 18,146,379 | 1,782,223 | 440,203 | 3,919

The Company markets its products through retail, wholesale clients, chains and supermarkets. As of December 31, 2016, the accounts receivable from the three most important supermarket chains in Chile and Argentina represent 27.1% (29.1% in 2015) of the total accounts receivable.

As indicated in the Risk management note (Note 5), for Credit Risk purposes, the Company acquires credit insurance policies to cover approximately 90% and 99% of the significant accounts receivable balances domestic and export, respectively, of the total of the account receivables. Regarding amounts aged more than 6 months and for which no allowances have been constituted, they correspond mainly to amounts already covered by the credit insurance policies. In addition, there are amounts overdue within ranges for which, in accordance with current policies are only partially impaired for, based on a case by case analysis.

For the above mentioned, management estimates that it does not require establishing allowances for further deterioration, in addition to those already constituted based on an aging analysis of these balances.

The write-offs of our doubtful clients are once all pre-trial and judicial, efforts have been made and exhausted all means of payment, with the proper demonstration of the insolvency of customers. This process of punishment normally takes more than 1 year.

F-63

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The movement of the impairment losses provision for accounts receivable is as follows:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Balance at the beginning of year | (3,936,871) | (3,153,132)
Impairment estimate for accounts receivable | (1,352,722) | (1,883,258)
Uncollectible accounts | 219,222 | 264,618
Back of unused provisions | 1,031,841 | 557,106
Effect of translation into presentation currency | 200,616 | 277,795
Total | (3,837,914) | (3,936,871)

F-64

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 15 Accounts and transactions with related companies

Transactions between the Company and its subsidiaries occur in the normal course of operations and have been eliminated during the consolidation process.

The amounts indicated as transactions in the following table relate to trade operations with related companies, which are under similar terms than what a third party would get respect to price and payment conditions. There are no uncollectible estimates decreasing accounts receivable or guarantees provided to related companies.

Balances and transactions with related companies consist of the following:

(1) Business operations agreed upon in Chilean Pesos. Companies not under a current trade account agreement not accrue interest and have payment terms of 30 days.

(2) Business operations agreed upon in Chilean Pesos. The remaining balance accrues interest at 90-days active bank rate (TAB) plus an annual spread. Interests is paid or charged against the trade current account.

(3) Business operations in foreign currencies, not covered by a current trade account, that do not accrue interest and have payment terms of 30 days. Balances are presented at the closing exchange rate.

(4) An agreement between the subsidiary Compañía Pisquera de Chile S.A. with Cooperativa Agrícola Control Pisquero de Elqui and Limarí Ltda. due to differences resulting from the contributions made by the latter. It establishes a 3% annual interest over capital, with annual payments to be made in eight instalments of UF 1,124 each. Beginning February 28, 2007 and UF 9,995 bullet payment at the last contribution date. In accordance with the contract, Cooperativa Agrícola Control Pisquero de Elqui and Limarí Ltda. renew the contract for a period of nine years. Consequently, the UF 9,995 will pay in ten instalments of UF 1,200 each one and a final payment of UF 2,050, beginning February 28, 2015.

(5) An agreement of grape supply between the subsidiary Compañía Pisquera de Chile S.A. with Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. These contracts stipulate a 3% annual interest on the capital, with a term of eight years, and annual payments due on May 31, 2018 and May 31,2020.

The transaction schedule includes all the transactions made with related parties.

The detail of the accounts receivable and payable from related companies as of December 31, 2016 and 2015, is as follows:

F-65

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Accounts receivable from related companies

Current:

Tax ID | Company | Country of origin | Ref. | Relationship | Transaction | Currency | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
0-E | Bebidas Bolivianas BBO S.A. | Bolivia | (3) | Associated | Sales of products | USD | 42,006 | 78,810
0-E | Pepsi Cola Panamericana S.R.L. | Perú | (3) | Associated with the controller | Sales of products | USD | 1,149 | 1,149
76,028,758-K | Norgistics Chile S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | - | 110
76,029,109-9 | Inversiones Chile Chico Ltda. | Chile | (1) | Related to the controller | Billed services | CLP | 526 | 5,353
76,178,803-5 | Viña Tabalí S.A. | Chile | (1) | Related to the controller | Billed services | CLP | 10,513 | 29,817
77,051,330-8 | Cervecería Kunstmann Ltda. | Chile | (1) | Related to the controller | Sales of products | CLP | 120,458 | 142,789
77,755,610-K | Comercial Patagona Ltda. | Chile | (1) | Joint venture | Sales of products | CLP | 1,035,566 | 738,270
77,755,610-K | Comercial Patagona Ltda. | Chile | (1) | Joint venture | Rental of cranes | CLP | 3,215 | 2,875
78,780,780-1 | Operaciones y Servicios Enex Ltda. | Chile | (1) | Related to the controller | Sales of products | CLP | 13,058 | 90,323
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | (5) | Shareholder to subsidiary | Advance purchase | CLP | 14,393 | 1,065,214
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | (1) | Shareholder to subsidiary | Sales of products | CLP | 7,450 | 24,027
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | (4) | Shareholder to subsidiary | Loan | U.F. | 30,542 | 29,589
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | (5) | Shareholder to subsidiary | Sales of products | U.F. | 76,620 | 74,529
90,081,000-8 | Compañía Chilena de Fósforos S.A. | Chile | (1) | Shareholder to subsidiary | Sales of products | CLP | 2,575 | 5,651
90,160,000-7 | Compañía Sud Americana de Vapores S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | 458 | 522
90,703,000-8 | Nestlé Chile S.A. | Chile | (1) | Shareholder to subsidiary | Sales of products | CLP | 14,747 | -
91,021,000-9 | Invexans S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | 4,552 | 3,723
91,705,000-7 | Quiñenco S.A. | Chile | (1) | Shareholder Controller | Sales of products | CLP | 1,937 | 3,070
92,011,000-2 | Empresa Nacional de Energía ENEX S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | - | 2,136
92,048,000-4 | SAAM S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | 1,437 | -
93,920,000-2 | Antofagasta Minerals S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | 3,479 | 4,198
94,625,000-7 | Inversiones Enex S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | 258,306 | 203,349
96,427,000-7 | Inversiones y Rentas S.A. | Chile | (1) | Controller | Sales of products | CLP | - | 12,664
96,536,010-7 | Inversiones Consolidadas Limitada | Chile | (1) | Related to the controller | Sales of products | CLP | 1,513 | 1,409
96,571,220-8 | Banchile Corredores de Bolsa S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | 3,096 | 1,073
96,591,040-9 | Empresas Carozzi S.A. | Chile | (1) | Shareholder of joint operation | Sales of products | CLP | 76,704 | 301,882
96,645,790-2 | Socofin S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | - | 10
96,819,020-2 | Agrícola El Cerrito S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | 30 | 30
96,847,140-6 | Inmobiliaria Norte Verde S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | 30 | 40
96,919,980-7 | Cervecería Austral S.A. | Chile | (1) | Joint venture | Sales of products | CLP | 255,330 | 29,502
97,004,000-5 | Banco de Chile | Chile | (1) | Related to the controller | Sales of products | CLP | 120,547 | 126,435
99,525,700-9 | Las Margaritas S.A. | Chile | (1) | Related to the controller | Sales of products | CLP | - | 47
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | (1) | Joint venture | Sales of products | CLP | 73,511 | 358,428
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | (1) | Joint venture | Transport service | CLP | 39,669 | 881,499
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | (1) | Joint venture | Interests | CLP | 219,835 | 219,647
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | (1) | Joint venture | Sales service | CLP | 96,572 | 118,292
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | (1) | Joint venture | Shared service | CLP | 243,689 | 182,822
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | (1) | Joint venture | Collection service | CLP | 312 | 49,646
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | (2) | Joint venture | Remittanse send | CLP | 750,000 | -
Total |  |  |  |  |  |  | 3,523,825 | 4,788,930

Non Current:

Tax ID | Company | Country of origin | Ref. | Relationship | Transaction | Currency | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | (4) | Shareholder to subsidiary | Loan | U.F. | 190,040 | 209,330
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limari Ltda. | Chile | (4) | Shareholder to subsidiary | Sales of products | U.F. | 166,625 | 236,608
Total |  |  |  |  |  |  | 356,665 | 445,938

F-66

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Accounts payable to related companies

Current:

Tax ID | Company | Country of origin | Ref. | Relationship | Transaction | Currency | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
0-E | Amstel Brouwerijen B.V. | Holanda | (3) | Related to the controller | License and technical assiStance | Euros | 64,932 | 246,334
0-E | Banco Amambay S.A. | Holanda | (3) | Associated | Commissions | PYG | 34 | -
0-E | Grafica y Editorial Intersuda S.A. | Holanda | (3) | Related to the controller | Purchase of products | PYG | 1,604 | -
0-E | Heineken Brouwerijen B.V. | Holanda | (3) | Related to the controller | License and technical assistance | Euros | 3,344,215 | 6,568,594
0-E | Heineken Brouwerijen B.V. | Holanda | (3) | Related to the controller | Purchase of products | Euros | 787,873 | 307,118
0-E | Heineken Nederland Supply | Francia | (3) | Related to the controller | License and technical assistance | Euros | - | 37,772
0-E | Heineken supply chain B.V. | Francia | (3) | Related to the controller | Purchase of products | Euros | - | 11,647
0-E | Nestlé Waters Management & Tecnology S.A.S. | Uruguay | (3) | Related to the controller | Purchase of products | Euros | - | 12,191
0-E | Nestlé Waters Marketing & Distribution S.A.S. | Chile | (3) | Related to the controller | Purchase of products | Euros | - | 21,861
0-E | Pespsi Cola Manufacturing Co. of Uruguay S.R.L. | Chile | (3) | Related to the controller | Purchase of products | USD | - | 151,578
0-E | Watt's Alimentos S.A. | Chile | (3) | Related to the cont roller | Purchase of products | USD | 2,196 | -
76,115,132-0 | Canal 13 S.p.A. | Chile | (1) | Related to the controller | Marketing services | CLP | 333,658 | 21,100
76,481,675-7 | Cerveceria Szot S.p.A. | Chile | (1) | Related to the controller | Purchase of products | CLP | 4,930 | -
77,051,330-8 | Cervecería Kunstmann Ltda. | Paraguay | (1) | Shareholder to subsidiary | Purchase of products | CLP | 6,691 | 15,707
77,755,610-K | Comercial Patagona Ltda. | Chile | (1) | Joint venture | Marketing services | CLP | 37,889 | 24,694
78,105,460-7 | Alimentos Nutrabien S.A. | Chile | (1) | Joint venture | Purchase of products | CLP | 315 | 212
78,259,420-6 | Inversiones PFI Chile Ltda. | Chile | (1) | Shareholder to subsidiary | Purchase of products | CLP | 846,035 | 1,195,665
81,805,700-8 | Cooperativa AgrÍcola Control Pisquero de Elqui y Limarí Ltda. | Chile | (1) | Shareholder to subsidiary | Purchase of products | CLP | 41,667 | -
84,356,800-9 | Watt´s S.A. | Chile | (1) | Shareholder of joint operation | Purchase of products | CLP | - | 13,205
89,010,400-2 | Alusa Chile S.A. | Chile | (1) | Related to the controller | Purchase of products | CLP | - | 437,884
92,011,000-2 | Empresa Nacional de Energía Enex S.A. | Chile | (1) | Related to the controller | Electric service | CLP | 124,255 | -
94,058,000-5 | Servicios Aeroportuarios Aerosan S.A. | Chile | (1) | Related to the controller | Transport service | CLP | 1,273 | 193
96,591,040-9 | Empresas Carozzi S.A. | Chile | (1) | Shareholder of joint operation | Purchase of products | CLP | 1,930,063 | -
96,689,310-9 | Transbank S.A. | Chile | (1) | Related to the controller | Commission | CLP | 2,955 | 25,911
96,798,520-1 | Saam Extraportuarios S.A. | Chile | (1) | Related to the controller | Transport service | CLP | - | 17
96,810,030-0 | Radiodifusion S.p.A | Chile | (1) | Related to the controller | Marketing services | CLP | 19,018 | -
96,894,740-0 | Banchile Factoring S.A. | Chile | (1) | Related to the controller | Factoring service | CLP | 78,591 | -
96,919,980-7 | Cervecería Austral S.A. | Chile | (1) | Joint venture | Purchase of products | CLP | 1,462,888 | 414,400
97,004,000-5 | Banco de Chile | Chile | (1) | Related to the controller | Billed services | CLP | 41,001 | 2,431
99,540,870-8 | Aguas de Antofagasta S.A. | Chile | (1) | Related to the controller | Water service | CLP | - | 36,879
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | (1) | Joint venture | Purchase of products | CLP | 36,834 | 63,212
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | (1) | Joint venture | Consignation sales | CLP | 217,689 | 2,015,613
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | (1) | Joint venture | Discount fleet | CLP | 143,465 | -
Total |  |  |  |  |  |  | 9,530,071 | 11,624,218

F-67

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Most significant transactions and effects on results:

The following are the most significant transactions with related entities that are not subsidiaries of the Company and their effect on the Consolidated Statement of Income:

Tax ID | Company | Country of origin | Relationship | Transaction | For the years ended as of December 31,
2016 | 2015 | 2014
Amounts | (Charges)/Credits (Effect on Income) | Amounts | (Charges)/Credits (Effect on Income) | Amounts | (Charges)/Credits (Effect on Income)
ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
0-E | Amstel Brouwerijen B.V | Holanda | Related to the controller | License and technical assistance | 165,995 | (165,995) | 229,967 | (229,967) | 161,865 | (161,865)
0-E | Bebidas Bolivianas BBO S.A. | Bolivia | Associated | Sales of products | 396,076 | 150,509 | 209,292 | 79,531 | - | -
0-E | Bebidas Bolivianas BBO S.A. | Bolivia | Associated | Contribution of capital | 2,174,370 | - | 1,921,245 | - | - | -
0-E | Central Cervecera de Colombia S.A.S. | Colombia | Joint operation | Contribution of capital | 22,943,861 | - | 19,941,532 | - | - | -
0-E | Heineken Brouwerijen B.V. | Holanda | Related to the controller | License and technical assistance | 9,445,557 | (9,445,557) | 9,331,241 | (9,331,241) | 6,338,435 | (6,338,435)
0-E | Heineken Brouwerijen B.V. | Holanda | Related to the controller | Billing services | 82,475 | (52,266) | 27,904 | (27,904) | 95,533 | (95,533)
0-E | Heineken Brouwerijen B.V. | Holanda | Related to the controller | Purchase of products | - | - | 71,107 | - | 295,899 | -
0-E | Heineken Brouwerijen B.V. | Holanda | Related to the controller | Sales of products | 161,220 | 120,915 | - | - | 208,932 | 79,394
0-E | Nestle Waters S.A. | Italy | Shareholder to subsidiary | Royalty paid | 432,535 | (432,535) | 308,527 | (308,527) | 204,010 | (204,010)
76,115,132-0 | Canal 13 S.p.A. | Chile | Related to the controller | Advertising | 3,427,941 | (2,661,759) | 1,554,332 | (405,349) | 3,318,107 | (1,196,948)
76,178,803-5 | Viña Tabalí S.A. | Chile | Related to the controller | Billed services | 52,470 | 52,470 | 50,787 | 50,787 | 64,321 | 64,321
76,313,970-0 | Inversiones Irsa Ltda. | Chile | Controller | Dividends paid | 4,132,618 | - | 4,089,832 | - | - | -
77,051,330-8 | Cervecería Kunstmann Ltda. | Chile | Shareholder to subsidiary | Sales of products | 522,566 | 418,052 | 405,652 | 324,522 | 317,990 | 254,392
77,755,610-K | Comercial Patagona Ltda. | Chile | Joint venture | Sales of products | 4,259,983 | 1,746,594 | 2,679,985 | 1,098,794 | 1,410,939 | 578,485
78,259,420-6 | Inversiones PFI Chile Ltda. | Chile | Shareholder to subsidiary | Purchase of products | 10,083,606 | - | 8,692,744 | - | - | -
78,259,420-6 | Inversiones PFI Chile Ltda. | Chile | Shareholder to subsidiary | Billed services | 3,234,158 | 3,234,158 | 2,649,644 | 2,649,644 | - | -
78,780,780-1 | Operaciones y Servicios Enex Ltda. | Chile | Related to the controller | Sales of products | 224,387 | 183,997 | 328,256 | 262,605 | - | -
79,985,340-K | Cervecera Valdivia S.A. | Chile | Shareholder to subsidiary | Dividends paid | 633,668 | - | 489,942 | - | 511,172 | -
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | Shareholder to subsidiary | Loan | 28,256 | 6,815 | 29,589 | 5,827 | 27,681 | 7,975
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | Shareholder to subsidiary | Sales of products | 76,619 | 9,285 | 74,529 | 8,487 | 71,616 | 11,411
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | Shareholder to subsidiary | Purchase of grape | 4,255,971 | - | 6,226,156 | - | 5,027,758 | -
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | Shareholder to subsidiary | Sales of products | - | - | 8,071 | 6,457 | - | -
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | Shareholder to subsidiary | Dividends paid | 599,123 | - | 791,836 | - | 617,964 | -
81,805,700-8 | Cooperativa Agrícola Control Pisquero de Elqui y Limarí Ltda. | Chile | Shareholder to subsidiary | Billed services | - | - | 181,437 | 181,437 | - | -
89,010,400-2 | Alusa Chile S.A. | Chile | Related to the controller | Purchase of products | 3,223,272 | - | 2,665,007 | - | 1,562,351 | -
90,081,000-8 | Compañía Chilena de Fósforo S.A. | Chile | Shareholder to subsidiary | Dividends paid | 1,273,753 | - | 4,055,034 | - | 1,637,775 | -
90,703,000-8 | Nestlé Chile S.A. | Chile | Shareholder to subsidiary | Dividends paid | 3,530,565 | - | 2,704,376 | - | 2,581,736 | -
91,705,000-7 | Quiñenco S.A. | Chile | Shareholder to Controller | Sales of products | 13,984 | 11,186 | 14,509 | 14,509 | - | -
93,920,000-2 | Antofagasta Minerals S.A. | Chile | Related to the controller | Sales of products | 35,532 | 28,069 | - | - | - | -
94,625,000-7 | Inversiones Enex S.A | Chile | Related to the controller | Sales of products | 1,161,918 | 906,296 | 636,707 | 496,631 | - | -
96,657,690-7 | Inversiones Punta Brava S.A. | Chile | Related to the controller | Sales of products | - | - | 1,587 | 1,270 | - | -
96,427,000-7 | Inversiones y Rentas S.A. | Chile | Controller | Office lease | 11,463 | 11,463 | 11,006 | 11,006 | 10,539 | 10,539
96,427,000-7 | Inversiones y Rentas S.A. | Chile | Controller | Dividends paid | 32,109,822 | - | 31,777,378 | - | 32,701,972 | -
96,571,220-8 | Banchile Corredores de Bolsa S.A. | Chile | Related to the controller | Investments | 61,400,000 | - | 225,840,000 | - | 315,790,000 | 797,953
96,571,220-8 | Banchile Corredores de Bolsa S.A. | Chile | Related to the controller | Investment Rescue | 170,500,000 | 402,369 | 231,800,000 | 583,333 | - | -
96,591,040-9 | Empresas Carozzi S.A. | Chile | Shareholder of joint operation | Sales of products | 311,666 | 249,322 | - | - | - | -
96,919,980-7 | Cervecería Austral S.A. | Chile | Joint venture | Sales of products | 62,444 | 27,788 | 36,560 | 16,269 | 315,650 | 126,260
96,919,980-7 | Cervecería Austral S.A. | Chile | Joint venture | Purchase of products | 5,438,419 | - | 4,776,140 | - | 3,525,715 | -
96,919,980-7 | Cervecería Austral S.A. | Chile | Joint venture | Billed services | 234,327 | 234,327 | 425,165 | 425,165 | 231,038 | 231,038
97,004,000-5 | Banco de Chile | Chile | Related to the controller | Sales of products | 87,772 | 48,800 | 39,148 | 25,446 | 60,472 | 21,165
97,004,000-5 | Banco de Chile | Chile | Related to the controller | Derivatives | 35,318,178 | 2,006,627 | 105,973,453 | 1,708,487 | 2,595,060 | (1,637)
97,004,000-5 | Banco de Chile | Chile | Related to the controller | Investments | 61,400,000 | - | 204,050,000 | - | 181,200,794 | 1,427,444
97,004,000-5 | Banco de Chile | Chile | Related to the controller | Leasing paid | 87,457 | 2,266 | 123,316 | (23,901) | 224,872 | (24,155)
97,004,000-5 | Banco de Chile | Chile | Related to the controller | Investment Rescue | 61,400,000 | 247,101 | 219,500,000 | 770,364 | - | -
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | Joint venture | Remittanse received | - | - | 33,298,001 | - | 31,367,766 | -
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | Joint venture | Remittanse send | 750,000 | - | 27,189,651 | - | 31,144,541 | -
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | Joint venture | Interests | - | - | 287,243 | 287,243 | 363,945 | 363,945
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | Joint venture | Sales of products | 5,973 | 2,745 | 13,540 | 6,223 | 15,097 | 9,511
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | Joint venture | Billed services | 1,553,943 | 1,553,943 | 7,633,582 | 7,633,582 | 6,990,442 | 6,990,442
99,542,980-2 | Foods Compañía de Alimentos CCU S.A. | Chile | Joint venture | Consignation sales | 5,115,078 | - | 24,067,498 | - | 23,303,360 | -

F-68

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Remuneration of the Management key employees

The Company is managed by a Board of Directors comprised of 9 members, each of whom is in office for a 3-year term and may be re-elected.

The Board was appointed at the Ordinary Shareholders´ Meeting held on April 13, 2016, being elected Messrs. Andrónico Luksic Craig, Francisco Pérez Mackenna, Pablo Granifo Lavín, Rodrigo Hinzpeter Kirberg, Marc Busain, Carlos Molina Solís, Didier Debrosse, José Miguel Barros van Hövell tot Westerflier y Vittorio Corbo Lioi, the latter independent according to article 50 bis of Law Nº18,046. The Chairman and the Vice Chairman, as well as the members of the Audit Committee were appointed at the Board of Directors´ meeting held on April 13, 2016. At the same meeting, and according to article 50 bis of Law N° 18,046, the independent Director Mr. Vittorio Corbo Lioi appointed the other members of the Directors Committee, which is composed of Directors Messrs. Pérez, Molina y Corbo. Additionally, Messrs. Corbo y Molina were appointed as members of the Audit Committee, both meeting the independence criteria under the Securities Exchange Act of 1934, the Sarbanes-Oxley Act of 2002 and the New York Stock Exchange Rules. The Board of Directors also resolved that Directors Messrs. Pérez y Barros shall participate in the Audit Committee´s meetings as observers.

As agreed to at the Ordinary Shareholders´ Meeting held on April 13, 2016, the remuneration of the Directors consists on a gross monthly fee for attendance to Board Meetings of UF 100 per Director, and UF 200 for the Chairman, independent of the number of meetings held within such period, plus an amount equivalent to 3% of the distributed dividends, for the whole Board, at a rate of one-ninth for each Director and in proportion to the time each one served as such during the year 2016. If the distributed dividends exceed 50% of the net profits, the Board of Directors’ variable remuneration shall be calculated over a maximum 50% of such profits.

Additionally, those Directors that are members of the Directors Committee receive a gross remuneration of UF 34 for each meeting they attend, plus the amount that, as the percentage of the dividends, is required to complete one third of the total remuneration a Director is entitled to, pursuant to article 50 bis of Law Nº 18,046 and Regulation N° 1956 of the SVS. Directors that are members of the Audit Committee receive a gross monthly remuneration of UF 25.

According to the above, as of December 31, 2016, the Directors received ThCh$ 3,215,759 (ThCh$ 2,976,684 in 2015 and ThCh$ 2,746,921 in 2014) in meeting attendance fees and dividend participation. In addition, ThCh$ 212,665 (ThCh$ 191,416 in 2015 and ThCh$ 117,342 in 2014) were paid as meeting attendance fees and dividend participation to the Senior Management of the Parent Company.

As of December 31, 2016, the remuneration corresponding to the key personal was ThCh$ 7,565,658 (ThCh$ 5,497,192 in 2015 and ThCh$ 5,191,018 in 2014). The Company grants annual discretionary and variable bonuses to the top key employees, which are not subject to an agreement and are decided on the basis of the compliance with individual and corporate goals and depending on the year results.

F-69

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 16 Inventories

The inventory balances were as follows:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Finished products | 76,323,417 | 50,873,881
In process products | 1,935,157 | 1,828,386
Raw material | 113,232,691 | 113,716,967
In transit raw material | 4,460,822 | 3,707,440
Materials and products | 5,675,945 | 5,926,122
Realizable net value estimate and obsolescence | (2,337,354) | (1,825,381)
Total | 199,290,678 | 174,227,415

The Company wrote off a total of ThCh$ 2,012,748, ThCh$ 2,057,704 and ThCh$ 1,369,096 relating to inventory shrinkage and obsolescence for the year ended December 31, 2016, 2015 y 2014, respectively.

Additionally, an estimate for obsolescence inventories include amounts related to low turnover, technical obsolescence and product recalls from the market.

Movement of Realizable net value and obsolescence estimate is as follows:

| As of December 31, 2016 | As of December 31, 2015 | As of December 31, 2014
| ThCh$ | ThCh$ | ThCh$
Initial balance | (1,825,381) | (2,589,518) | (1,286,695)
Inventories write-down estimation | (2,551,828) | (1,469,233) | (2,682,310)
Inventories recognised as an expense | 2,012,748 | 2,057,704 | 1,369,096
Business combination effect | 27,107 | 175,666 | 10,391
Total | (2,337,354) | (1,825,381) | (2,589,518)

As of December 31, 2016, 2015 and 2014, the Company does not have any inventory pledged as guarantee against financial obligations.

F-70

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 17 Biological current assets

The Company recorded under Biological current assets the agricultural activities (grapes) derived from production of plantations that will be destined to be an input to the following process of the wine production.

The costs associated to the agricultural activities (grapes) are accumulated to the harvest date.

The valuation of Biological current assets is described in Note 2, 2.10.

The movement of Biological current assets were as follows:

| ThCh$
As of January 1, 2015 |
Historic cost | 7,633,591
Book Value | 7,633,591
As of December 31, 2015 |
Acquisitions | 18,192,939
Decreases due to harvesting | (18,193,190)
Book Value | 7,633,340
As of December 31, 2015 |
Historic cost | 7,633,340
Book Value | 7,633,340
As of December 31, 2016 |
Acquisitions | 19,611,307
Decreases due to harvesting | (19,296,268)
Book Value | 7,948,379
As of December 31, 2016 |
Historic cost | 7,948,379
Book Value | 7,948,379

#

F-71

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 18 Other non-financial assets

The Company maintained the following other non-financial assets:

| As of December 31, 2016 | As of December 31, 2015
| Current | Non current | Current | Non current
| ThCh$ | ThCh$ | ThCh$ | ThCh$
Insurance paid | 3,038,856 | - | 3,512,317 | -
Advertising | 5,819,736 | 2,567,939 | 4,822,197 | 2,652,382
Advances to suppliers | 5,269,826 | - | 7,438,102 | -
Guarantees paid | 50,590 | 227,738 | 99,493 | 228,749
Consumables | 433,570 | - | 526,645 | -
Dividends receivable | 245,073 | - | 150,343 | -
Recoverable taxes (1) | - | 1,231,414 | - | 1,303,925
Cost of subsidiaries acquired (2) | - | 641,489 | - | -
Other | 1,001,486 | 700,631 | 1,105,276 | 1,035,898
Total | 15,859,137 | 5,369,211 | 17,654,373 | 5,220,954

(1) Corresponds to the tax profit minimum and VAT credit exporter, both registered in the argentine subsidiaries, whose term of recovery is estimated over a year.

(2) See Note 1, (2).

# Note 19 Investment accounted for by the equity method

Joint ventures and Associates

As of December 31, 2016 and 2015, the Company recorded investments qualifying as joint venture and associates.

The share value of the investments in joint ventures and associates is as follows:

| Percentage of participation | As of December 31, 2016 | As of December 31, 2015
% | ThCh$ | ThCh$
Cervecería Austral S.A. (1) | 50.00 | 5,548,458 | 5,043,071
Foods Compañía de Alimentos CCU S.A. (2) | 50.00 | 5,624,391 | 11,582,085
Central Cervecera de Colombia S.A.S. (3) | 50.00 | 35,449,038 | 18,718,832
Total joint ventures |  | 46,621,887 | 35,343,988
Bebidas Bolivianas BBO S.A. (4) | 34.00 | 17,281,665 | 14,276,937
Other companies |  | 501,394 | 374,338
Total associates |  | 17,783,059 | 14,651,275
Total |  | 64,404,946 | 49,995,263

F-72

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The above mentioned values include the goodwill generated through the acquisition of the following joint venture and associate, which are presented net of any impairment loss:

|  | As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Cervecería Austral S.A. |  | 1,894,770 | 1,894,770
Bebidas Bolivianas BBO S.A. |  | 9,032,617 | 7,648,453
Total |  | 10,927,387 | 9,543,223

The results accrued in joint ventures and associates are as follows:

| For the years ended as of December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Cervecería Austral S.A. | 754,326 | 247,180 | 157,836
Foods Compañía de Alimentos CCU S.A. | (519,536) | (1,251,392) | (334,771)
Central Cervecera de Colombia S.A.S. | (3,969,699) | (2,668,179) | -
Total joint ventures | (3,734,909) | (3,672,391) | (176,935)
Bebidas Bolivianas BBO S.A. | (1,805,548) | (1,557,886) | (1,019,011)
Other companies | (20,065) | 2,142 | -
Total associates | (1,825,613) | (1,555,744) | (1,019,011)
Total | (5,560,522) | (5,228,135) | (1,195,946)

Changes in investments in joint ventures and associates during such periods are as follows:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Balance at the beginning of year | 49,995,263 | 31,998,620
Business combination effect | 25,118,232 | 23,387,006
Participation in the joint ventures and associates (loss) | (5,560,522) | (5,228,135)
Dividends received | (245,073) | (150,343)
Increase (decrease) through changes in ownership interests | (5,426,209) | -
Others | 523,255 | (11,885)
Total | 64,404,946 | 49,995,263

Following are the significant matters regarding the investments accounted by the equity method:

(1) Cervecería Austral S.A.

A closed stock company that operates a beer manufacturing facility in the southern end of Chile, being the southernmost brewery in the world.

(2) Foods Compañía de Alimentos CCU S.A.

A closed stock company devoted to the production and marketing of food products such as like cookies and other baked goods, caramels, candy and cereal, among others.

On November 26, 2015, Foods signed an agreement of sale with Empresas Carozzi S.A., under which the first sold to the second machinery, equipment and brands related to products marketed under the brands Natur and Calaf. The amount of this transaction was ThCh$ 14,931,000 and CCU recognized a net loss after taxes for an amount of ThCh$ 1,034,638, corresponding to their participation.

F-73

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

On December 16, 2016, Foods and the subsidiary CCU Inversiones S.A., proceeded to acquire 49,99999% and 0.0001%, respectively of the shares of Alimentos Nutrabien S.A. As a consequence above mentioned the only shareholders direct of that company are: (i) Food´s with 99.99999% of the share capital, and (ii) CCU investments S.A. with a 0.0001% of the share capital, respectively. The amount of this transaction was UF 545.000, equivalent to ThCh$ 14.352.706.

(3) Central Cervecera de Colombia S.A.S.

On November 10, 2014, CCU, directly and through its subsidiaries CCU Inversiones II Limitada, and Postobón have established a joint arrangements through a company named Central Cervecera de Colombia S.A.S. (the "Company"), in which CCU and Postobón participate as equal shareholders. The purpose of this Company is the beer and non-alcoholic drinks production, marketing and distribution based on malt. The Parties will invest in the Company an approximate amount of US$ 400,000,000, following a gradual investment plan conditioned to the fulfillment of certain milestones. As of December 31, 2016 CCU Inversiones II Limitada paid US$ 68,078,797 (US$ 33,901,562 in 2015). The partnership involves the construction of a beer production plant, with an annual total capacity of 3,000,000 hectoliters.

Committed capital payments have been made on the following dates: November 20, 2014, for US$ 2,411,019 (equivalents to ThCh$ 1,445,478; March 25 and 7 July, 2015 for US$ 7,749,931 and US$ 23,740,612 (equivalents to ThCh$ 4,833,244 and ThCh$ 15,108,288, respectively and on August 30, 2016 was a new increased in capital for an amount of US$ 34,177,235 (equivalents to ThCh$ 22,943,861).

(4) Bebidas Bolivianas BBO S.A.

On May 7, 2014, the Company acquired 34% of the stock rights of Bebidas Bolivianas BBO S.A. a Bolivian and a closed stock company that produces soft drinks and beers in three plants located in Santa Cruz de la Sierra and Nuestra Señora de la Paz cities. The amount of this transaction was ThCh$ 13,776,885. On December 9, 2015, the Company paid an increased of capital for an amount of US$ 2,720,000 (equivalents to ThCh$ 1,921,244). On June 8, 2016 and November 17, 2016, the Company paid an increased of capital for an amount of US$ 2,221,696 (equivalents to ThCh$ 1,510,420) and US$ 1,019,971 (equivalents to ThCh$ 663,951), respectively.

The Company does not have any contingent liabilities related to joint ventures and associates as D ecember 31, 2016.

F-74

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The summarized financial information of these companies as of December 31, 2016, 2015 and 2014 and the figures for each entity 100% of each in summary form are as follows:

| Joint ventures | Associated | Joint ventures | Associated | Joint ventures | Associated
| For the years ended as of December 31,
| 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Income Statement (Summarized) |  |  |  |  |  |
Net sales | 63,926,397 | 19,733,853 | 59,187,508 | 18,310,272 | 46,399,652 | 8,470,716
Operating result | (11,913,526) | (4,159,093) | (6,796,020) | (4,039,249) | 212,503 | (2,882,721)
Net income for year | (7,287,727) | (4,712,596) | (6,803,143) | (4,573,734) | (392,427) | (2,920,431)
Other comprehensive income | (3,451,487) | (7,965,214) | (2,494,511) | - | 1,312,608 | 3,719,889
Depreciation and amortization | (2,104,820) | (2,698,849) | (1,998,935) | (534,485) | (1,936,455) | (1,091,414)
| As of December 31, 2016 | As of December 31, 2015 | As of December 31, 2015
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Assets and Liabilities |  |  |  |  |  |
Current assets | 64,587,798 | 7,602,940 | 57,908,034 | 9,326,003 | 15,625,609 | 6,987,602
Non-current assets | 50,994,744 | 30,504,073 | 29,453,402 | 31,393,842 | 39,076,178 | 17,664,655
Current liabilities | 23,043,784 | 5,886,879 | 6,233,586 | 6,086,146 | 17,550,702 | 4,467,768
Non-current liabilities | 2,350,385 | 7,789,367 | 3,720,129 | 9,494,421 | 2,725,097 | 5,244,421

F-75

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 20 Intangible assets other than goodwill

The intangible assets movement during the years ended as of December 31, 2015 and 2016 was as follows:

| Trademarks | Software programs | Water rights | Distribution rights | Total
ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
As of January 1, 2015 |  |  |  |  |
Historic cost | 58,720,268 | 21,353,252 | 1,914,139 | 1,046,487 | 83,034,146
Accumulated amortization | - | (14,281,717) | - | (95,534) | (14,377,251)
Book Value | 58,720,268 | 7,071,535 | 1,914,139 | 950,953 | 68,656,895
As of December 31, 2015 |  |  |  |  |
Additions | - | 3,160,435 | - | 104,739 | 3,265,174
Additions by business combination (1) | 7,747,581 | - | - | - | 7,747,581
Transfers (2) | (3,266,332) | - | - | - | (3,266,332)
Divestitures (cost) | - | (3,748) | - | - | (3,748)
Divestitures (amortization) | - | 3,748 | - | - | 3,748
Amortization of year | - | (1,814,784) | - | (126,877) | (1,941,661)
Conversion effect | (2,235,479) | (297,814) | - | (247,219) | (2,780,512)
Effect of conversion (amortization) | - | 164,652 | - | 22,210 | 186,862
Book Value | 60,966,038 | 8,284,024 | 1,914,139 | 703,806 | 71,868,007
As of December 31, 2015 |  |  |  |  |
Historic cost | 60,966,038 | 24,212,125 | 1,914,139 | 904,007 | 87,996,309
Accumulated amortization | - | (15,928,101) | - | (200,201) | (16,128,302)
Book Value | 60,966,038 | 8,284,024 | 1,914,139 | 703,806 | 71,868,007
As of December 31, 2016 |  |  |  |  |
Additions | 40,000 | 4,533,631 | 219,163 | - | 4,792,794
Additions by business combination (1) | 5,614,575 | - | - | - | 5,614,575
Divestitures (cost) | - | (167,825) | (42,243) | - | (210,068)
Divestitures (amortization) | - | 197,910 | - | - | 197,910
Amortization of year | - | (2,472,425) | - | (389,166) | (2,861,591)
Conversion effect | (1,714,990) | (213,166) | - | (140,990) | (2,069,146)
Effect of conversion (amortization) | - | 130,442 | - | 215,927 | 346,369
Book Value | 64,905,623 | 10,292,591 | 2,091,059 | 389,577 | 77,678,850
As of December 31, 2016 |  |  |  |  |
Historic cost | 64,905,623 | 28,364,765 | 2,091,059 | 763,017 | 96,124,464
Accumulated amortization | - | (18,072,174) | - | (373,440) | (18,445,614)
Book Value | 64,905,623 | 10,292,591 | 2,091,059 | 389,577 | 77,678,850

(1) See Note 1, letter a) and d).

(2) See Note 24, letter a).

There are no restriction or any pledge against on intangible assets.

F-76

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The detail of the Trademarks appears below:

Operating segment | Cash Generating Unit | As of December 31, 2016 | As of December 31, 2015
(CGU) | ThCh$ | ThCh$
Chile | Embotelladoras Chilenas Unidas S.A. | 31,476,163 | 25,861,588
| Manantial S.A. | 1,166,000 | 1,166,000
| Compañía Pisquera de Chile S.A. | 1,363,782 | 1,363,782
| Compañía Cerveceria Kunstmann S.A. | 286,744 | 286,518
| Subtotal | 34,292,689 | 28,677,888
International Business | CCU Argentina S.A. and subsidiaries | 4,774,066 | 6,171,061
| Marzurel S.A., Coralina S.A. and Milotur S.A. | 2,822,016 | 2,932,762
| Bebidas del Paraguay S.A. y Distribuidora del Paraguay S.A. | 3,234,664 | 3,440,608
| Subtotal | 10,830,746 | 12,544,431
Wines | Viña San Pedro Tarapacá S.A. | 19,782,188 | 19,743,719
| Subtotal | 19,782,188 | 19,743,719
Total |  | 64,905,623 | 60,966,038

Management has not identified any evidence of impairment of intangible assets. Respect to trademarks with indefinite useful life, used the same methodology which is designated in Note 21.

F-77

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 21 Goodwill

The goodwill movements during the years ended as of December 31, 2016 and 2015 was as follows:

| Goodwill
| ThCh$
As of January 1, 2015 |
Historic cost | 86,779,903
Book Value | 86,779,903
As of December 31, 2015 |
Additions by business combination (1) | 16,189,798
Transfers (2) | (2,856,245)
Conversion effect | (623,084)
Book Value | 99,490,372
As of December 31, 2015 |
Historic cost | 99,490,372
Book Value | 99,490,372
As of December 31, 2016 |
Conversion effect | (2,827,349)
Book Value | 96,663,023
As of December 31, 2016 |
Historic cost | 96,663,023
Book Value | 96,663,023

(1) See Note 1, letter d).

(2) See Note 24, letter a).

Goodwill from investments acquired in business combinations is assigned as of the acquisition date to the Cash Generating Units (CGU), or group of CGUs that it is expected will benefit from the business combination synergies. The book value of the goodwill of the investments assigned to the CGUs inside the Company segments are:

Operating segment | Cash Generating Unit | As of December 31, 2016 | As of December 31, 2015
(CGU) | ThCh$ | ThCh$
Chile | Embotelladoras Chilenas Unidas S.A. | 25,257,686 | 25,257,686
| Manantial S.A. | 8,879,245 | 8,879,245
| Compañía Pisquera de Chile S.A. | 9,808,550 | 9,808,550
| Los Huemules S.R.L. | 47,443 | 47,443
| Subtotal | 43,992,924 | 43,992,924
International Business | CCU Argentina S.A. and subsidiaries | 6,851,916 | 8,864,698
| Marzurel S.A., Coralina S.A. and Milotur S.A. | 7,260,675 | 7,701,975
| Bebidas del Paraguay S.A. y Distribuidora del Paraguay S.A. | 6,141,364 | 6,514,631
| Subtotal | 20,253,955 | 23,081,304
Wines | Viña San Pedro Tarapacá S.A. | 32,416,144 | 32,416,144
| Subtotal | 32,416,144 | 32,416,144
Total |  | 96,663,023 | 99,490,372

F-78

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Goodwill assigned to the CGU is subject to impairment tests annually or with a higher frequency in case there are indications that any of the CGU could experience impairment. The recoverable amount of each CGU is determined as the higher of value in use or fair value less costs to sell. To determine the value in use, the Company has used cash flow projections over a 5-year span, based on the budgets and projections reviewed by Management for the same term and with an average grown-rate of 3%. The rates used to discount the projected cash flows reflect the market assessment of the specific risks related to the corresponding CGU. The pre-tax discount rates used range from a 9.5% to 12.8%. Given the materiality of the amounts involved, it was not considered relevant to describe additional information in this Note. A reasonable change in assumptions would not result in an impairment to goodwill.

As December 31, 2016, t he Company has not identified any evidence of impairment of goodwill.

F-79

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 22 Property, plant and equipment

The movement of Property, plant and equipment is as follows:

| Land, buildings and contruction | Machinery and equipment | Bottles and containers | Other Equipment | Assets under contruction | Furniture, accesories and vehicles | Assets under finance lease | Under production vines | Total
ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
As of January 1, 2015 |  |  |  |  |  |  |  |  |
Historic cost | 557,500,819 | 388,454,274 | 189,538,674 | 111,860,840 | 101,859,601 | 56,290,001 | 16,367,167 | 30,037,467 | 1,451,908,843
Accumulated depreciation | (136,838,685) | (233,259,470) | (101,755,979) | (73,303,551) | - | (39,158,230) | (2,620,547) | (13,716,739) | (600,653,201)
Book Value | 420,662,134 | 155,194,804 | 87,782,695 | 38,557,289 | 101,859,601 | 17,131,771 | 13,746,620 | 16,320,728 | 851,255,642
As of December 31, 2015 |  |  |  |  |  |  |  |  |
Additions | - | - | - | - | 123,581,249 | - | - | - | 123,581,249
Transfers | 24,332,658 | 53,855,456 | 21,539,178 | 12,777,031 | (121,954,867) | 8,596,245 | 8,750 | 845,549 | -
Conversion effect historic cost | (6,736,100) | (10,797,668) | (11,546,968) | (4,002,063) | (460,019) | (511,782) | (2,578) | (180,003) | (34,237,181)
Write off (cost) | (747,359) | (289,708) | (3,742,613) | (1,918,945) | - | (1,156,594) | (18,734) | - | (7,873,953)
Write off (depreciation) | 394,898 | 184,171 | 3,456,971 | 1,909,228 | - | 636,696 | 12,858 | - | 6,594,822
Capitalized interests | - | - | - | - | 1,086,976 | - | - | - | 1,086,976
Depreciation | (16,319,675) | (23,241,987) | (20,568,254) | (9,738,483) | - | (6,504,278) | (290,871) | (1,009,087) | (77,672,635)
Conversion effect depreciation | 828,924 | 4,905,696 | 5,480,844 | 2,894,015 | - | 353,900 | 256 | 81,519 | 14,545,154
Others increase (decreased) | 264,777 | 368,742 | 783,920 | 226,420 | (2,018,429) | 150,953 | (23,262) | - | (246,879)
Divestitures (cost) | (416,892) | (1,536,631) | (11,721,918) | (1,758,026) | - | (1,512,864) | (283) | (1,063,451) | (18,010,065)
Divestitures (depreciation) | 489,274 | 1,193,606 | 10,980,342 | 1,624,423 | - | 965,423 | 165 | 629,647 | 15,882,880
Transfers to Assets Held for Sale (Cost) | (2,682,692) | - | - | - | - | - | - | - | (2,682,692)
Transfers to Assets Held for Sale (Depreciation) | 443,892 | - | - | - | - | - | - | - | 443,892
Book Value | 420,513,839 | 179,836,481 | 82,444,197 | 40,570,889 | 102,094,511 | 18,149,470 | 13,432,921 | 15,624,902 | 872,667,210
As of December 31, 2015 |  |  |  |  |  |  |  |  |
Historic cost | 569,642,008 | 428,398,944 | 185,024,437 | 117,920,217 | 102,094,511 | 60,844,400 | 16,447,490 | 29,639,562 | 1,510,011,569
Accumulated depreciation | (149,128,169) | (248,562,463) | (102,580,240) | (77,349,328) | - | (42,694,930) | (3,014,569) | (14,014,660) | (637,344,359)
Book Value | 420,513,839 | 179,836,481 | 82,444,197 | 40,570,889 | 102,094,511 | 18,149,470 | 13,432,921 | 15,624,902 | 872,667,210
As of December 31, 2016 |  |  |  |  |  |  |  |  |
Additions | - | - | - | - | 128,518,969 | - | - | - | 128,518,969
Transfers | 22,834,409 | 40,559,020 | 26,734,419 | 11,477,889 | (115,555,005) | 12,571,079 | - | 1,378,189 | -
Conversion effect historic cost | (5,161,938) | (9,794,457) | (10,440,956) | (3,309,017) | (716,066) | (63,653) | (1,927) | (100,704) | (29,588,718)
Write off (cost) | (421,820) | (1,114,726) | (963,296) | (602,003) | 164,887 | (1,425,485) | - | - | (4,362,443)
Write off (depreciation) | 16,882 | 1,045,213 | 1,211,494 | 557,191 | - | 809,775 | - | - | 3,640,555
Capitalized interests | - | - | - | - | 853,832 | - | - | - | 853,832
Depreciation | (16,446,343) | (22,298,558) | (20,154,538) | (9,709,915) | - | (9,495,693) | (235,007) | (1,025,552) | (79,365,606)
Conversion effect depreciation | 1,743,342 | 4,080,872 | 3,082,501 | 4,139,993 | - | 252,389 | 578 | 66,872 | 13,366,547
Others increase (decreased) | (40,372) | 1,960,728 | (1,217,118) | (313,368) | (779,982) | 792,760 | (620,991) | - | (218,343)
Divestitures (cost) | (1,973,792) | (4,671,503) | (919,611) | (105,417) | - | (479,526) | - | (1,480,301) | (9,630,150)
Divestitures (depreciation) | 1,366,357 | 4,474,718 | 699,573 | 23,026 | - | 375,766 | - | 1,010,409 | 7,949,849
Book Value | 422,430,564 | 194,077,788 | 80,476,665 | 42,729,268 | 114,581,146 | 21,486,882 | 12,575,574 | 15,473,815 | 903,831,702
As of December 31, 2016 |  |  |  |  |  |  |  |  |
Historic cost | 584,830,357 | 453,656,276 | 196,174,306 | 129,190,151 | 114,581,146 | 70,251,593 | 13,926,785 | 29,436,746 | 1,592,047,360
Accumulated depreciation | (162,399,793) | (259,578,488) | (115,697,641) | (86,460,883) | - | (48,764,711) | (1,351,211) | (13,962,931) | (688,215,658)
Book Value | 422,430,564 | 194,077,788 | 80,476,665 | 42,729,268 | 114,581,146 | 21,486,882 | 12,575,574 | 15,473,815 | 903,831,702

F-80

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The balance of the land at the end of each year is as follows:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Land | 226,136,602 | 227,849,584
Total | 226,136,602 | 227,849,584

Capitalized interest as of December 31, 2016, amounted to ThCh$ 853,832 (ThCh$ 1,086,976 in 2015), using an annually capitalization rate of 4.17% for both years.

The Company, through its subsidiaries Viña San Pedro Tarapacá S.A., has biological assets corresponding to vines that produce grapes. The vines are segmented into those under formation and those under production, and they are grown both on leased and owned land. The grapes harvested from these vines are used in the manufacturing of wine, which is marketed both in the domestic market and abroad.

As of December 31, 2016, the Company maintained approximately 4,208 of which 3,787 hectares are for vines in production stage. Of the total hectares mentioned above, 3,455 correspond to own land and 332 to leased land.

The vines under formation are recorded at historic cost, and only start being depreciated when they are transferred to the production phase, which occurs in the majority of cases in the third year after plantation, when they start producing grapes commercially (in volumes that justify their production-oriented handling and later harvest).

During 2016, the production plant vines yield approximately 49.8 million kilos of grapes (60.1 million kilos of grapes in 2015).

As part of the risk administration activities, the subsidiaries use insurance agreements for the damage caused by nature or other to their biological assets. In addition, either productive or under formation vines are not affected by title restrictions of any kind, nor have they been pledged as a guarantee for financial liabilities.

By the nature of business of the Company, in the value of the assets it is not considered to start an allowance for cost of dismantling, removal or restoration.

In relation to the impairment losses of property, plant and equipment, the Managment has not perceived evidence of impairment with respect to these at December 31, 2016.

Assets under finance lease:

The book value of land and buildings relates to finance lease agreements for the Company and its subsidiaries. Such assets will not be owned by the Company until the corresponding purchase options are exercised.

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Land | 3,130,181 | 3,037,571
Buildings | 9,217,312 | 9,333,443
Machinery and equipment | 228,081 | 1,061,907
Total | 12,575,574 | 13,432,921

In Note 26, letter B) includes the detail of the lease agreements, and it also reconciles the total amount of the future minimum lease payments and their current value as regards such assets, the purchase options originated at CCU S.A., Compañía Cervecera Kunstmann S.A. and Manantial S.A.

F-81

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 23 Investment Property

Changes in the movement of the investment property during the years ended as of December 31, 2015 and 2016 is as follows:

| Lands | Buildings | Total
ThCh$ | ThCh$ | ThCh$
As of January 1, 2015 |  |  |
Historic cost | 5,860,457 | 2,775,205 | 8,635,662
Depreciation | - | (718,049) | (718,049)
Book Value | 5,860,457 | 2,057,156 | 7,917,613
As of December 31, 2015 |  |  |
Additions | - | 4,148 | 4,148
Transfers from PPE (cost) | (275,000) | - | (275,000)
Depreciation | - | (60,450) | (60,450)
Conversion effect (depreciation) | (488,315) | (291,928) | (780,243)
Conversion effect | - | 31,934 | 31,934
Book Value | 5,097,142 | 1,740,860 | 6,838,002
As of December 31, 2015 |  |  |
Historic cost | 5,097,142 | 2,487,425 | 7,584,567
Depreciation | - | (746,565) | (746,565)
Book Value | 5,097,142 | 1,740,860 | 6,838,002
As of December 31, 2016 |  |  |
Additions | - | 11,036 | 11,036
Divestitures | (2,563) | - | (2,563)
Depreciation | - | (41,055) | (41,055)
Conversion effect (depreciation) | (364,940) | (218,986) | (583,926)
Conversion effect | - | 32,333 | 32,333
Book Value | 4,729,639 | 1,524,188 | 6,253,827
As of December 31, 2016 |  |  |
Historic cost | 4,729,639 | 2,279,475 | 7,009,114
Depreciation | - | (755,287) | (755,287)
Book Value | 4,729,639 | 1,524,188 | 6,253,827

Investment property includes twenty land properties, two offices and one apartment, situated in Chile, which are maintained for appreciation purposes, with one land property, two offices and one apartment of them being leased and generating ThCh$ 251,545 revenue during year 2016 (ThCh$ 172,243 in 2015 and ThCh$ 153,283 in 2014). Additionally, there are three land properties in Argentina, which are leased and generated an income for ThCh$ 131,389 for year 2016 (ThCh$ 127,093 in 2015 and ThCh$ 117,661 in 2014). In addition, the expenses associated with such investment properties amounted to ThCh$ 71,090 for the year ended as of December 31, 2016 (ThCh$ 120,340 in 2015 and ThCh$ 190,670 in 2014).

The fair value, of investment property that represent 90% of the book value, is ThCh$ 18,249,882.

Management has not detected any evidence of impairment of Investment property.

The Company does not maintain any pledge or restriction over investment property items.

#

F-82

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 24 Assets of disposal group held for sale

a) | Chile Operating segment
| On January 7, 2016, the shareholders of Compañía Pisquera Bauzá S.A. came to an agreement in which Compañía Pisquera de Chile S.A. (“CPCh”) (subsidiary of Compañía Cervecerías Unidas S.A.) has sold its interest of 49% to Agroproductos Bauzá S.A. The price of the transaction amounted to UF 150,000 (equivalent to ThCh$ 3,844,364 on December 31, 2015). In January 2016, the first installment was paid for an amount of UF 20,000 (equivalents to ThCh$ 512,596 on January 8, 2016). As of December 31, 2016, the balances is UF 130,000 plus interest, of which UF 20,000 with short-term maturity (equivalents to ThCh$ 526,959) and UF 110,000 with long-term maturity (equivalents to ThCh$ 2,898,277 payable in annual installments maturing in 2020 (See Note 14). Previously, in October 2015, the Board of Directors of CPCh agreed to instruct the Management to obtain an agreement with Agroproductos Bauzá based on the terms which were reflected in the before mentioned transaction. As a consequence of the aforementioned CPCh recorded a provision before taxes for an amount of ThCh$ 1,401,253, charged to the result of the fourth quarter of for year 2015. This amount is presented under Other gains/losses in the Consolidated Statement of Income of the quarter.

b) | International Business Operating segment
- | During the last quarter of 2009, the Board of Tamarí S.A. (merged with Finca la Celia S.A. as of April 1, 2011) authorized the sale of fixed assets which includes the winery with facilities for processing and storage of wines as well as of acres that surround it and the guest house. This decision is based primarily on the advantage of consolidating the operations of processing and packaging of wines from the Wine Group subsidiaries VSPT facilities in Finca La Celia, generating significant synergies for the Group.
- | During 2010, the Company hired a specialist broker for such assets. Subsequently, on December 13, 2011, a sales reservation contract was signed for all of the assets. At the date of issuance of these Financial Statements this transaction is current.
- | During December 2014, the Board of subsidiary Sidra La Victoria S.A. authorized the sale of property located in Cipolletti city, Provincia de Río Negro, Argentina. During November 2015 this property was sold and a gain before tax of ThCh$ 1,977,432 was recognize under item Other income by function.
- | During September 2015, the Board of subsidiary Saenz Briones S.A. authorized the sale of property located in Luján de Cuyo city, Provincia de Mendoza, Argentina. At the date of issuance of these Financial Statements that property is the same condition.

c) | Wine Operating segment
- | During November 2015, the Board of subsidiary Viña Valles de Chile S.A. (legal and continuing successor of Viña Misiones de Rengo S.A.) authorized the sale of certanis fixed asstes located in Rengo city, Provincia de Cachapoal, Sexta Región. On December 23, 2015 signed sale reservation contract for al fiexed assets available for the sale. At the date of issuance of these Financial Statements that transaction is current.

As described in Note 2, 2.18, non-current assets held for sale have been recorded at the lower of carrying amount less cost to sale.

F-83

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

At December 31, 2016 and 2015, the items of assets held for sale are the following:

Assets of disposal group held for sale | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
Land | 1,816,348 | 1,855,980
Contructions | 504,207 | 544,863
Machinerys | 57,332 | 74,109
Joint agreement (Trademarks, goodwill, net of deferred taxes) (1) | - | 3,844,364
Total | 2,377,887 | 6,319,316

(1) Under this ítem include ThCH$ 2,856,245 related to Goodwill

# Note 25 Income taxes

Tax accounts receivable

The detail of the taxes receivables is the following:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Refundable tax previous year | 4,436,810 | 3,296,151
Taxes under claim (1) | 2,141,476 | 2,138,675
Argentinean tax credits | 2,532,114 | 3,756,333
Monthly provisions | 18,860,164 | 4,592,593
Payment of absorbed profit provision | 75,141 | 33,276
Other credits | 1,377,774 | 1,447,192
Total | 29,423,479 | 15,264,220

(1) This item include claims for refund of first category taxes (Provisional payment of absorved profit) for an amount of ThCh$ 968,168 that was presented in April 2014 from the commercial year 2013 and claim to ThCh$ 1,173,281 presented in April 2010 from the commercial year 2009.

Taxes accounts payable

The detail of taxes payable taxes is as follows:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Chilean income taxes | 7,033,363 | 7,689,139
Monthly provisional payments | 4,365,187 | 3,488,085
Chilean unique taxes | 68,824 | 224,045
Estimated Argentine minimum gain subsidiaries taxes | 339,060 | 796,755
Total | 11,806,434 | 12,198,024

F-84

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Tax expense

The detail of the income tax and deferred tax expense for the years ended as of December 31, 2016, 2015 and 2014, is as follows:

| For the years ended as of December 31,
| 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$
Income as per deferred tax related to the origin and reversal of temporary differences | (878,629) | (454,933) | 992,342
Prior year adjustments | 3,838,136 | 3,204,656 | 4,763,242
Effect of change in tax rates | (856,612) | (1,066,964) | (14,520,287)
Tax benefits (loss) | (765,292) | 248,559 | 527,447
Total deferred tax expense | 1,337,603 | 1,931,318 | (8,237,256)
Current tax expense | (31,285,976) | (48,168,474) | (34,522,795)
Prior period adjustments | (298,010) | (3,877,360) | (3,913,449)
(Loss) Income from income tax | (30,246,383) | (50,114,516) | (46,673,500)

(1) On September 29, 2014 Act No. 20,780 was published in Chile, regarding the so called “Tax reform” which introduces amendments, among others, to the Income tax system. The said Act provides that corporations will apply by default the "Partially Integrated System", unless a future Extraordinary Shareholders Meeting agrees to opt for the "Attributed Income Regime”. The Act provides for the "Partially Integrated System" a gradual increase in the First Category Income tax rate, going from 20% to 21% for the business year 2014, to 22.5% for the business year 2015, to 24% for the business year 2016, to 25.5% for the business year 2017 and to 27% starting 2018 business year.

The difference between assets and liabilities for deferred taxes which occur as a direct effect of the increase in the First Category Income tax rate introduced by Act No. 20,780, has been accounted against to Net income. As of December 31, 2014, the total effect registered against the Net income was an amount of ThCh$ 14,520,287.

The deferred taxes related to items charged or credited directly to Consolidated Statement of Comprehensive Income are as follows:

| For the years ended as of December 31,
| 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$
Net income from cash flow hedge | (20,648) | (17,563) | 39,470
Actuarial gains and losses deriving from defined benefit plans | 659,198 | 314,541 | 501,689
Charge to equity | 638,550 | 296,978 | 541,159

Effective Rate

The Company’s income tax expense as of December 31, 2016, 2015 y 2014 represents 17.70%, 26.30% and 27.90%, respectively of income before taxes. The following is reconciliation between such effective tax rate and the statutory tax rate valid in Chile.

| For the years ended as of December 31,
2016 | 2015 | 2014
ThCh$ | Rate (%) | ThCh$ | Rate (%) | ThCh$ | Rate (%)
Income before taxes | 170,328,270 | - | 190,640,106 | - | 167,168,082 | -
Income tax using the statutory rate | (40,878,785) | 24.00 | (42,894,024) | 22.50 | (35,105,297) | 21.00
Adjustments to reach the effective rate |  |  |  |  |  |
Tax effect of permanent differences, net | 10,357,858 | (6.10) | (3,202,337) | 1.70 | (133,385) | 0.10
Effect of change in tax rate | (856,612) | 0.50 | (1,066,964) | 0.50 | (14,520,287) | 8.60
Effect of tax rates in Argentina and Uruguay | (1,308,482) | 0.80 | (2,278,489) | 1.20 | 2,235,676 | (1.30)
Prior year adjustments | 2,439,638 | (1.40) | (672,702) | 0.40 | 849,793 | (0.50)
Income tax, as report ed | (30,246,383) | 17.70 | (50,114,516) | 26.30 | (46,673,500) | 27.90

F-85

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Deferred taxes

Deferred tax assets and liabilities included in the Balance Sheet were as follows:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Movement of deferred tax assets |  |
Accounts receivable impairment provision | 861,158 | 714,251
Other non-tax expenses | 11,303,607 | 12,808,597
Employee benefits | 2,166,999 | 1,930,430
Inventory impairment provision | 1,554,362 | 499,611
Severance indemnity | 4,937,161 | 5,044,561
Inventory valuation | 2,337,591 | 1,454,638
Amortization of intangibles | 206,616 | 2,517,835
Other assets | 3,536,574 | 3,856,366
Tax loss carryforwards | 4,960,567 | 5,703,304
Total assets from deferred taxes | 31,864,635 | 34,529,593
Deferred taxes liabilities |  |
Fixed assets depreciation | 36,617,407 | 40,338,573
Capitalized software expense | 2,271,445 | 1,852,161
Agricultural operation expense | 5,698,674 | 4,348,021
Manufacturing indirect activation costs | 4,865,509 | 3,867,574
Intangibles | 10,054,490 | 10,012,031
Land | 23,726,645 | 26,511,916
Other liabilities | 3,555,781 | 3,307,567
Total liabilities from deferred taxes | 86,789,951 | 90,237,843
Total | (54,925,316) | (55,708,250)

No deferred taxes have been recorded for the temporary differences between the taxes and accounting value generated by investments in subsidiaries; consequently deferred tax is not recognized for the Translation Adjustments or investments in Joint Ventures and Associates.

In accordance with current tax laws in Chile, taxable losses do not expire and can be applied indefinitely. Regarding Argentina, taxable losses expire after 5 years.

F-86

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Movement of deferred tax assets | ThCh$
As of January 1, 2015 | (57,311,681)
Increase in joint operation | (1,208,970)
Deferred Tax Losses Tax absorption | (33,276)
Deferred taxes from tax loss carry forwards absorption | 1,931,318
Conversion effect | 503,187
Deferred taxes against equity | 296,978
Other deferred movements taxes | 114,194
Change | 1,603,431
As of December 31, 2015 | (55,708,250)
As of January 1, 2016 |
Increase in joint operation | (1,514,955)
Deferred Tax Losses Tax absorption | (178,473)
Deferred taxes from tax loss carry forwards absorption | 1,337,603
Conversion effect | 245,227
Deferred taxes against equity | 638,550
Other deferred movements taxes | 254,982
Change | 782,934
As of December 31, 2016 | (54,925,316)

# Note 26 Other financial liabilities

Debts and financial liabilities classified based on the type of obligation and their classifications in the consolidated balance sheet are as follows:

| As of December 31, 2016 | As of December 31, 2015
| Current | Non current | Current | Non current
| ThCh$ | ThCh$ | ThCh$ | ThCh$
Bank borrowings (*) | 39,079,561 | 29,606,398 | 27,714,998 | 48,335,093
Bonds payable (*) | 3,250,023 | 70,836,716 | 3,155,239 | 71,352,994
Financial leases obligations (*) | 215,950 | 17,500,919 | 321,416 | 17,238,458
Deposits for return of bottles and containers | 13,015,723 | - | 12,503,170 | -
Derivatives financial instruments (**) | 11,118,676 | - | 171,470 | -
Hedging derivatives (**) | - | - | 107,698 | -
Total | 66,679,933 | 117,944,033 | 43,973,991 | 136,926,545

(*) See Note 5.

(**) See Note 6.

F-87

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The maturities and interest rates of such obligations are as follows:

As of December 31, 2016:

|  |  |  |  |  |  | Maturity (*) |  |
Debtor Tax ID | Company | Debtor country | Lending party Tax ID | Creditor name | Creditor country | Currency | 0 to 3 months | 3 months to 1 year | Over 1 year to 3 years | Over 3 years to 5 years | Over 5 years | Total | Amortization rate | Interest Rate
|  |  |  |  |  |  | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |  | %
Bank borrowings |  |  |  |  |  |  |  |  |  |  |  |  |
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Superville | Argentina | USD | 136,115 | - | - | - | - | 136,115 | At maturity | 3.50
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Superville | Argentina | USD | 135,537 | - | - | - | - | 135,537 | At maturity | 3.50
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Superville | Argentina | USD | 217,353 | - | - | - | - | 217,353 | At maturity | 3.50
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Superville | Argentina | USD | - | 54,032 | - | - | - | 54,032 | At maturity | 4.25
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Macro | Argentina | USD | - | 200,933 | - | - | - | 200,933 | At maturity | 1.85
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Patagonia | Argentina | USD | 201,628 | - | - | - | - | 201,628 | At maturity | 2.70
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Patagonia | Argentina | USD | - | 133,909 | - | - | - | 133,909 | At maturity | 2.00
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Patagonia | Argentina | $ARG | 1,436 | 1,589 | - | - | - | 3,025 | Quarter | 15.25
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Patagonia | Argentina | $ARG | 433,258 | - | - | - | - | 433,258 | At maturity | 36.00
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Patagonia | Argentina | $ARG | 228,734 | - | - | - | - | 228,734 | At maturity | 29.00
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Patagonia | Argentina | $ARG | 340,659 | - | - | - | - | 340,659 | At maturity | 28.50
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Patagonia | Argentina | $ARG | - | 518,917 | - | - | - | 518,917 | At maturity | 26.75
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco San Juan | Argentina | $ARG | 367,243 | - | - | - | - | 367,243 | Quarter | 30.00
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco San Juan | Argentina | $ARG | 9,178 | 400,250 | - | - | - | 409,428 | Quarter | 27.00
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco San Juan | Argentina | $ARG | 425 | 84,263 | - | - | - | 84,688 | Quarter | 23.00
0-E | Finca La Celia S.A. | Argentina | 0-E | BBVA | Argentina | $ARG | 524,538 | - | - | - | - | 524,538 | At maturity | 27.50
0-E | Finca La Celia S.A. | Argentina | 0-E | BBVA | Argentina | $ARG | 50,045 | - | - | - | - | 50,045 | At maturity | 27.00
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Patagonia | Argentina | $ARG | 290,342 | - | - | - | - | 290,342 | At maturity | 27.75
0-E | Finca La Celia S.A. | Argentina | 0-E | Banco Patagonia | Argentina | $ARG | 74,763 | - | - | - | - | 74,763 | At maturity | 27.50
91,041,000-8 | Viña San Pedro Tarapacá S.A. (1) | Chile | 97,004,000-5 | Banco de Chile | Chile | CLP | 57,821 | 7,271,000 | - | - | - | 7,328,821 | At maturity | 4.40
91,041,000-8 | Viña San Pedro Tarapacá S.A. | Chile | 97,030,000-7 | Banco Estado | Chile | UF | 157,295 | - | 10,012,233 | - | - | 10,169,528 | At maturity | 2.70
91,041,000-8 | Viña San Pedro Tarapacá S.A. (1) | Chile | 97,018,000-1 | Scotiabank | Chile | USD | 3,151 | - | 5,269,733 | - | - | 5,272,884 | At maturity | 1.79
99,586,280-8 | Compañía Pisquera de Chile S.A | Chile | 97,030,000-7 | Banco Estado | Chile | CLP | 457,454 | 16,000,000 | - | - | - | 16,457,454 | At maturity | 6.86
96,711,590-8 | Manantial S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | UF | 16,333 | 50,142 | 46,143 | - | - | 112,618 | Monthly | 4.80
96,711,590-8 | Manantial S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | UF | 9,264 | 28,576 | 57,305 | - | - | 95,145 | Monthly | 5.48
96,711,590-8 | Manantial S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | UF | 7,599 | 5,124 | - | - | - | 12,723 | Monthly | 5.36
96,711,590-8 | Manantial S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | CLP | 13,500 | 40,500 | 108,000 | 18,000 | - | 180,000 | Monthly | 6.00
96,711,590-8 | Manantial S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | CLP | 19,000 | 57,000 | 12,667 | - | - | 88,667 | Monthly | 7.59
96,711,590-8 | Manantial S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | CLP | 14,000 | 42,000 | 88,667 | - | - | 144,667 | Monthly | 5.88
96,711,590-8 | Manantial S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | CLP | 22,500 | 67,500 | 180,000 | 22,500 | - | 292,500 | Monthly | 5.76
96,711,590-8 | Manantial S.A. | Chile | 76,645,030-K | Banco Itaú | Chile | CLP | 8,111 | 25,086 | 72,892 | 13,047 | - | 119,136 | Monthly | 6.12
96,711,590-8 | Manantial S.A. | Chile | 97,030,000-7 | Banco Estado | Chile | CLP | - | 205,849 | - | - | - | 205,849 | Monthly | 4.92
96,711,590-8 | Manantial S.A. | Chile | 97,030,000-7 | Banco Estado | Chile | CLP | 67,488 | 203,111 | 580,563 | - | - | 851,162 | Monthly | 4.92
96,711,590-8 | Manantial S.A. | Chile | 97,030,000-7 | Banco Estado | Chile | CLP | 19,030 | 58,392 | 167,461 | 52,210 | - | 297,093 | Monthly | 5.02
96,711,590-8 | Manantial S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | CLP | 37,500 | 112,500 | 37,510 | - | - | 187,510 | Monthly | 5.04
96,711,590-8 | Manantial S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | CLP | - | 255,037 | - | - | - | 255,037 | Monthly | 4.68
0-E | Milotur S.A. | Uruguay | 0-E | Banco Itaú | Uruguay | UYI | 406,353 | 638,554 | 696,605 | - | - | 1,741,512 | Monthly | 6.00
96,981,310-6 | Compañia Cervecera Kunstmann S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | CLP | 21,408 | - | 2,000,000 | - | - | 2,021,408 | At maturity | 5.35
96,981,310-6 | Compañia Cervecera Kunstmann S.A. | Chile | 97,018,000-1 | Scotiabank | Chile | CLP | 18,000 | 2,000,000 | - | - | - | 2,018,000 | At maturity | 4.50
96,981,310-6 | Compañia Cervecera Kunstmann S.A. | Chile | 97,004,000-5 | Banco de Chile | Chile | CLP | - | 6,656 | 400,000 | - | - | 406,656 | At maturity | 4.68
96,981,310-6 | Compañia Cervecera Kunstmann S.A. | Chile | 97,030,000-7 | Banco Estado | Chile | CLP | 190,490 | 584,272 | 1,672,625 | 520,654 | - | 2,968,041 | Monthly | 5.02
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco BNA | Argentina | $ARG | 251,181 | 717,375 | 1,912,999 | - | - | 2,881,555 | Monthly | 15.00
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco Macro | Argentina | $ARG | 34,300 | 23,406 | - | - | - | 57,706 | Monthly | 15.25
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco BBVA | Argentina | $ARG | 421,179 | 421,652 | - | - | - | 842,831 | Quarter | 26.00
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco BNA | Argentina | $ARG | 103,106 | 303,347 | 134,821 | - | - | 541,274 | Monthly | 25.19
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco Galicia | Argentina | $ARG | 68,826 | 789,966 | 5,529,763 | - | - | 6,388,555 | Quarter | 30.50
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco Citibank | Argentina | $ARG | 30,190 | - | - | - | - | 30,190 | At maturity | 25.66
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco HSBC | Argentina | $ARG | 2,109,794 | - | - | - | - | 2,109,794 | At maturity | 25.25
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco BBVA | Argentina | $ARG | 1,392 | - | - | - | - | 1,392 | At maturity | 26.12
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco Macro | Argentina | $ARG | 12 | - | - | - | - | 12 | At maturity | 25.53
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Santander Rio | Argentina | $ARG | 199,954 | - | - | - | - | 199,954 | At maturity | 25.00
0-E | Saenz Briones y Cía. S.A. | Argentina | 0-E | Banco Citibank | Argentina | $ARG | 1,138 | - | - | - | - | 1,138 | At maturity | 26.50
Sub-total |  |  |  |  |  |  | 7,778,623 | 31,300,938 | 28,979,987 | 626,411 | - | 68,685,959 |  |

(1) This obligation is hedged by a Cross Currency Interest Rate Swap agreement (Note 6).

(*) See Note 5 the non-discounted contractual cash flows.

F-88

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

|  |  |  |  |  |  | Maturity |  |
Debtor Tax ID | Company | Debtor country | Registration or ID No. Instrument | Creditor country | Currency | 0 to 3 months | 3 months to 1 year | Over 1 year to 3 years | Over 3 years to 5 years | Over 5 years | Total | Amortization rate | Interest Rate
|  |  |  |  |  |  | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |  | %
Bonds payable |  |  |  |  |  |  |  |  |  |  |  |  |
90,413,000-1 | Compañía Cervecerías Unidas S.A. | Chile | 388 18/10/2004 Bono Serie E | Chile | UF | - | 2,612,294 | 5,125,926 | 5,298,895 | 7,904,394 | 20,941,509 | Semiannual | 4.00
90,413,000-1 | Compañía Cervecerías Unidas S.A. | Chile | 573 23/03/2009 Bono Serie H | Chile | UF | 637,729 | - | 2,345,596 | 9,540,856 | 40,621,049 | 53,145,230 | Semiannual | 4.25
Sub-total |  |  |  |  |  |  | 637,729 | 2,612,294 | 7,471,522 | 14,839,751 | 48,525,443 | 74,086,739 |  |

|  |  |  |  |  |  | Maturity |  |
Debtor Tax ID | Company | Debtor country | Lending party Tax ID | Creditor name | Creditor country | Currency | 0 to 3 months | 3 months to 1 year | Over 1 year to 3 years | Over 3 years to 5 years | Over 5 years | Total | Amortization rate | Interest Rate
|  |  |  |  |  |  | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |  | %
Financial leases obligations |  |  |  |  |  |  |  |  |  |  |  |  |
0-E | Finca La Celia S.A | Argentina | - | Banco Supervielle | Argentina | $ARG | 981 | 3,017 | 1,464 | - | - | 5,462 | At maturity | 17.50
96,711,590-8 | Manantial S.A. | Chile | - | Banco de Creditos e Inversiones | Chile | UF | 14,369 | 3,837 | - | - | - | 18,206 | Monthly | 3.13
96,711,590-8 | Manantial S.A. | Chile | - | Banco de Chile | Chile | UF | 6,054 | 8,072 | - | - | - | 14,126 | Monthly | 8.65
96,711,590-8 | Manantial S.A. | Chile | - | Banco Security | Chile | UF | 4,489 | 8,755 | - | - | - | 13,244 | Monthly | 9.25
90,413,000-1 | Compañía Cervecerías Unidas S.A. | Chile | - | Consorcio Nacional de Seguros S.A | Chile | UF | 13,759 | 42,717 | 125,221 | 130,838 | 17,131,641 | 17,444,176 | Monthly | 7.07
96,981,310-6 | Compañía Cervecera Kunstmann S.A | Chile | 97,030,000-7 | BancoEstado | Chile | UF | 25,436 | 77,942 | 98,688 | - | - | 202,066 | Monthly | 4.33
76,077,848-6 | Cervecera Belga de la Patagonia S.A. | Chile | 97,015,000-5 | Banco Santander de Chile | Chile | UF | - | 6,522 | - | 13,067 | - | 19,589 | Monthly | 6.27
Sub-total |  |  |  |  |  |  | 65,088 | 150,862 | 225,373 | 143,905 | 17,131,641 | 17,716,869 |  |
Total |  |  |  |  |  |  | 8,481,440 | 34,064,094 | 36,676,882 | 15,610,067 | 65,657,084 | 160,489,567 |  |

F-89

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

As of December 31, 2015:

|  |  |  |  |  |  | Maturity (*) |  |
Debtor Tax ID | Company | Debtor country | Lending party Tax ID | Creditor name | Creditor country | Currency | 0 to 3 months | 3 months to 1 year | Over 1 year to 3 years | Over 3 years to 5 years | Over 5 years | Total | Amortization rate | Interest Rate
|  |  |  |  |  |  | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |  | %
Bank borrowings |  |  |  |  |  |  |  |  |  |  |  |  |
0-E | Finca La Celia S.A | Argentina | O-E | Banco Supervielle | Argentina | USD | - | 128,459 | - | - | - | 128,459 | At maturity | 6.00
0-E | Finca La Celia S.A | Argentina | O-E | Banco Patagonia | Argentina | $ARG | 272,706 | - | - | - | - | 272,706 | At maturity | 28.00
0-E | Finca La Celia S.A | Argentina | O-E | Banco Patagonia | Argentina | $ARG | 106,222 | - | - | - | - | 106,222 | At maturity | 28.50
0-E | Finca La Celia S.A | Argentina | O-E | Banco Patagonia | Argentina | $ARG | 420,665 | - | - | - | - | 420,665 | At maturity | 28.00
0-E | Finca La Celia S.A | Argentina | O-E | Banco Patagonia | Argentina | $ARG | 1,857 | 7,389 | 3,095 | - | - | 12,341 | At maturity | 15.25
0-E | Finca La Celia S.A | Argentina | O-E | Banco Patagonia | Argentina | $ARG | 506,450 | - | - | - | - | 506,450 | At maturity | 27.50
0-E | Finca La Celia S.A | Argentina | O-E | Banco San Juan | Argentina | $ARG | 151,260 | - | - | - | - | 151,260 | At maturity | 29.00
0-E | Finca La Celia S.A | Argentina | O-E | Banco San Juan | Argentina | $ARG | - | 486,804 | - | - | - | 486,804 | Quarter | 29.00
0-E | Finca La Celia S.A | Argentina | O-E | Banco Patagonia | Argentina | $ARG | 405,927 | - | - | - | - | 405,927 | At maturity | 25.00
0-E | Finca La Celia S.A | Argentina | O-E | Banco BBVA | Argentina | $ARG | 535,283 | - | - | - | - | 535,283 | At maturity | 29.50
0-E | Viña San Pedro Tarapaca S.A. (1) | Argentina | O-E | Banco de Chile | Argentina | USD | 28,782 | 3,150,341 | - | - | - | 3,179,123 | At maturity | 1.92
91.041.000-8 | Viña San Pedro Tarapaca S.A. (2) | Chile | 97.004.000-5 | Banco de Chile | Chile | USD | 66,496 | 7,101,600 | - | - | - | 7,168,096 | At maturity | 1.90
91.041.000-8 | Viña San Pedro Tarapaca S.A. | Chile | 97.004.000-5 | Banco Estado | Chile | UF | - | 56,243 | - | 9,739,054 | - | 9,795,297 | At maturity | 2.70
91.041.000-8 | Viña San Pedro Tarapaca S.A. (1) | Chile | 97.030.000-7 | Scotiabank | Chile | USD | - | 2,977 | 5,590,024 | - | - | 5,593,001 | At maturity | 1.15
91.041.000-8 | Compañía Pisquera de Chile S.A | Chile | 97.018.000-1 | Banco Estado | Chile | CLP | 449,879 | - | 15,978,778 | - | - | 16,428,657 | At maturity | 6.86
99.586.280-8 | Manantial S.A. | Chile | 97.030.000-7 | Banco de Chile | Chile | UF | 15,123 | 46,470 | 109,544 | - | - | 171,137 | At maturity | 4.80
96.711.590-8 | Manantial S.A. | Chile | 97.004.000-5 | Banco de Chile | Chile | UF | 8,529 | 26,304 | 75,692 | 16,855 | - | 127,380 | Monthly | 5.48
96.711.590-8 | Manantial S.A. | Chile | 97.004.000-5 | Banco de Chile | Chile | UF | 7,004 | 21,588 | 12,375 | - | - | 40,967 | Monthly | 5.36
96.711.590-8 | Manantial S.A. | Chile | 97.004.000-5 | Banco de Chile | Chile | CLP | 13,500 | 40,500 | 108,000 | 72,000 | - | 234,000 | Monthly | 6.00
96.711.590-8 | Manantial S.A. | Chile | 97.004.000-5 | Banco de Chile | Chile | CLP | 19,000 | 57,000 | 88,668 | - | - | 164,668 | Monthly | 7.59
96.711.590-8 | Manantial S.A. | Chile | 97.004.000-5 | Banco de Chile | Chile | CLP | 14,000 | 42,000 | 112,000 | 32,667 | - | 200,667 | Monthly | 5.88
96.711.590-8 | Manantial S.A. | Chile | 97.004.000-5 | Banco de Chile | Chile | CLP | 22,500 | 67,500 | 180,000 | 112,500 | - | 382,500 | Monthly | 5.76
96.711.590-8 | Manantial S.A. | Chile | 97.004.000-5 | Banco Itaú | Chile | CLP | 23,690 | 56,839 | - | - | - | 80,529 | Monthly | 6.66
96.711.590-8 | Manantial S.A. | Chile | 76.645.030-K | Banco Itaú | Chile | CLP | 7,704 | 23,532 | 68,516 | 50,621 | - | 150,373 | Monthly | 6.12
96.711.590-8 | Manantial S.A. | Chile | 76.645.030-K | Banco Estado | Chile | CLP | 200,000 | - | - | - | - | 200,000 | Monthly | 5.26
96.711.590-8 | Manantial S.A. | Chile | 76.645.030-K | Banco Estado | Chile | CLP | 254,313 | - | - | - | - | 254,313 | Monthly | 4.38
96.711.590-8 | Manantial S.A. | Chile | 97.030.000-7 | Banco Estado | Chile | CLP | 35,843 | 36,436 | - | - | - | 72,279 | At maturity | 7.56
96.711.590-8 | Manantial S.A. | Chile | 97.030.000-7 | Banco Estado | Chile | CLP | - | 150,000 | - | - | - | 150,000 | At maturity | 5.40
96.711.590-8 | Manantial S.A. | Chile | 97.030.000-7 | Banco Estado | Chile | CLP | - | 255,510 | - | - | - | 255,510 | Monthly | 4.22
96.711.590-8 | Manantial S.A. | Chile | 97.030.000-7 | Banco Estado | Chile | CLP | 18,029 | 55,418 | 158,974 | 138,117 | - | 370,538 | Monthly | 5.02
96.711.590-8 | Milotur S.A. | Chile | 97.030.000-7 | Nuevo Banco Comercial | Chile | USD | 25,991 | 71,036 | - | - | - | 97,027 | At maturity | 5.50
96.711.590-8 | Milotur S.A. | Chile | 97.030.000-7 | Banco Itaú | Chile | UYI | - | 344,850 | 1,701,800 | - | - | 2,046,650 | Monthly | 6.00
0-E | Compañia Cervecera Kunstmann S.A. | Uruguay | O-E | Banco Estado | Uruguay | CLP | - | 515,083 | - | - | - | 515,083 | Monthly | 4.34
0-E | Compañia Cervecera Kunstmann S.A. | Uruguay | O-E | Banco Estado | Uruguay | CLP | - | 618,100 | - | - | - | 618,100 | Monthly | 4.34
96.981.310-6 | Compañia Cervecera Kunstmann S.A. | Chile | 97.030.000-7 | Banco de Chile | Chile | CLP | - | 1,030,538 | - | - | - | 1,030,538 | At maturity | 4.38
96.981.310-6 | Compañia Cervecera Kunstmann S.A. | Chile | 97.030.000-7 | Scotiabank | Chile | USD | 7,229 | 453,561 | - | - | - | 460,790 | At maturity | 1.90
96.981.310-6 | Compañia Cervecera Kunstmann S.A. | Chile | 97.004.000-5 | Banco Estado | Chile | CLP | 180,724 | 555,208 | 1,589,858 | 1,378,183 | - | 3,703,973 | At maturity | 5.02
96.981.310-6 | Compañia Cervecera Kunstmann S.A. | Chile | 97.018.000-1 | Scotiabank | Chile | CLP | - | 1,028,447 | - | - | - | 1,028,447 | At maturity | 4.08
96.981.310-6 | Compañía Industrial Cervecera S.A. | Chile | 97.030.000-7 | Banco BNA | Chile | $ARG | 345,777 | 927,294 | 2,472,784 | 1,236,392 | - | 4,982,247 | Monthly | 15.00
96.981.310-6 | Compañía Industrial Cervecera S.A. | Chile | 97.018.000-1 | Banco BNA | Chile | $ARG | 173,166 | 392,114 | 697,088 | - | - | 1,262,368 | At maturity | 25.19
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco BBVA | Argentina | $ARG | 560,011 | 1,633,640 | 1,089,584 | - | - | 3,283,235 | Quarter | 26.00
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco Galicia | Argentina | $ARG | 1,272,502 | 1,815,157 | 5,446,285 | - | - | 8,533,944 | Monthly | 29.40
0-E | Compañía Industrial Cervecera S.A. | Argentina | 0-E | Banco Macro | Argentina | $ARG | 44,130 | 136,150 | 75,639 | - | - | 255,919 | Monthly | 15.25
0-E | Saenz Briones y Cía. S.A. | Argentina | 0-E | Banco Citibank | Argentina | $ARG | 65,596 | 121,022 | - | - | - | 186,618 | Quarter | 15.25
Sub-total |  |  |  |  |  |  | 6,259,888 | 21,455,110 | 35,558,704 | 12,776,389 | - | 76,050,091 |  |

(1) This obligation is hedged by a Cross Currency Interest Rate Swap agreement (Note 6).

(2) This obligation is hedged by a Cross Currency Rate Swap agreement (Note 6).

(*) See Note 5 the non-discounted contractual cash flows.

F-90

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

|  |  | Registration or ID No. Instrument |  |  | Maturity |  |
Debtor Tax ID | Company | Debtor country | Creditor country | Currency | 0 to 3 months | 3 months to 1 year | Over 1 year to 3 years | Over 3 years to 5 years | Over 5 years | Total | Amortization rate | Interest Rate
|  |  |  |  | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |  | %
Bonds payable |  |  |  |  |  |  |  |  |  |  |  |  |
90.413.000-1 | Compañía Cervecerías Unidas S.A. | Chile | 388 18/10/2004 BONO SERIE E | Chile | UF | - | 2,539,921 | 4,953,915 | 5,095,419 | 10,251,636 | 22,840,891 | Semiannual | 4.00
90.413.000-1 | Compañía Cervecerías Unidas S.A. | Chile | 573 23/03/2009 BONO SERIE H | Chile | UF | 615,318 | - | - | 2,252,581 | 48,799,443 | 51,667,342 | Semiannual | 4.25
Sub-total |  |  |  |  |  |  | 615,318 | 2,539,921 | 4,953,915 | 7,348,000 | 59,051,079 | 74,508,233 |  |

|  |  |  |  |  |  | Maturity |  |
Debtor Tax ID | Company | Debtor country | Lending party Tax ID | Creditor name | Creditor country | Currency | 0 to 3 months | 3 months to 1 year | Over 1 year to 3 years | Over 3 years to 5 years | Over 5 years | Total | Amortization rate | Interest Rate
|  |  |  |  |  |  | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |  | %
Financial leases obligations |  |  |  |  |  |  |  |  |  |  |  |  |
0-E | Finca La Celia S.A | Argentina | O-E | Banco Supervielle | Argentina | $ARG | 1,267 | 3,900 | 6,147 | - | - | 11,314 | Monthly | 17.50
96.711.590-8 | Manantial S.A. | Chile | 97.000.600-6 | Banco de Creditos e Inversiones | Chile | UF | 5,371 | 16,386 | 9,292 | - | - | 31,049 | Monthly | 5.06
96.711.590-8 | Manantial S.A. | Chile | 97.004.000-5 | Banco de Chile | Chile | UF | 10,764 | 16,845 | 13,524 | - | - | 41,133 | Monthly | 9.31
96.711.590-8 | Manantial S.A. | Chile | 97.053.000-2 | Banco Security | Chile | UF | 21,598 | 25,628 | 12,867 | - | - | 60,093 | Monthly | 6.81
90.413.000-1 | Compañía Cervecerías Unidas S.A. | Chile | 99.012.000-5 | Consorcio Nacional de Seguros S.A | Chile | UF | 12,499 | 38,806 | 113,757 | 225,991 | 16,628,473 | 17,019,526 | Monthly | 7.07
96.981.310-6 | Compañía Cervecera Kunstmann S.A | Chile | 97.004.000-5 | Banco de Chile | Chile | UF | 42,822 | 23,183 | 12,799 | - | - | 78,804 | Monthly | 5.58
96.981.310-6 | Compañía Cervecera Kunstmann S.A | Chile | 97.030.000-7 | BancoEstado | Chile | UF | 23,716 | 72,672 | 196,552 | - | - | 292,940 | Monthly | 4.33
76.077.848-6 | Cervecera Belga de la Patagonia S.A. | Chile | 97.015.000-5 | Banco Santander de Chile | Chile | UF | 1,455 | 4,504 | 13,097 | 5,959 | - | 25,015 | Monthly | 6.27
Sub-total |  |  |  |  |  |  | 119,492 | 201,924 | 378,035 | 231,950 | 16,628,473 | 17,559,874 |  |
Total |  |  |  |  |  |  | 6,994,698 | 24,196,955 | 40,890,654 | 20,356,339 | 75,679,552 | 168,118,198 |  |

F-91

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Details of the fair value of bank borrowings, financial leases obligations and bonds payable are described in Note 6.

The effective interest rates of bond obligations are as follows:

Bonds Serie A | 3.96%
Bonds Serie E | 4.52%
Bonds Serie H | 4.26%
Bonds Serie I | 3.18%

The debts and financial liabilities are stated in several currencies and they accrue fixed and variable interest rates. The details of such obligations classified as per currency and interest type (excluding the effect of cross currency interest rate swap agreements) are as follows:

| As of December 31, 2016 | As of December 31, 2015
| Fixed Interest Rate | Variable Interest Rate | Fixed Interest Rate | Variable Interest Rate
| ThCh$ | ThCh$ | ThCh$ | ThCh$
US Dollar | 1,079,507 | 5,272,884 | 686,276 | 15,940,220
Chilean Pesos | 33,822,001 | - | 25,840,175 | -
Argentine Pesos | 11,515,546 | 4,869,957 | 17,146,915 | 4,266,388
Unidades de Fomento | 102,188,160 | - | 102,191,574 | -
UYI | 1,741,512 | - | 2,046,650 | -
Total | 150,346,726 | 10,142,841 | 147,911,590 | 20,206,608

The terms and conditions of the main interest accruing obligations as of December 31, 2016, were as follows:

A) Bank Borrowings

Banco Estado – Bank Loans

a) On July 27, 2012, the subsidiary Compañía Pisquera Chile S.A. (CPCh) signed a bank loan with the Banco Estado for a total of ThCh$ 16,000,000, for a period of 5 years, with maturity on July 27, 2017.

This loan accrues interest at an annual fixed rate of 6.86% and an effective rate of 7.17%. The Company amortizes interest semi-annually, and the capital amortization consists of a single payment at the end of the established term.

This obligation is subject to certain reporting obligations in addition to complying with the following financial ratios, which will be measured on the half-yearly financial statements of CPCh:

- Maintain a Financial Expense Coverage not less than 3, calculated as the relationship between Gross Margin less Marketing costs, Distribution and Administration expenses, plus Other income by function, less Other expenses by function, plus Depreciation and Amortization, divided by Financial costs.

- Maintain a debt ratio of no more than 2.5, measured as Total liabilities divided by Equity.

- Maintain an Equity higher than UF 770,000.

In addition, this loan obliges CPCh to comply with certain restrictions of affirmative nature, including maintaining insurance, maintaining the ownership of essential assets, and also to comply with certain restrictions, such as not to pledge, mortgage or grant any kind of encumbrance or real right over any fixed asset with an individual accounting value higher than UF 10,000, except under the terms established by the agreement, among other.

As of December 31, 2016, the Company was in compliance with the financial covenants and specific requirements of this loan.

F-92

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

b) On April 25, 2012, the subsidiary Compañía Cervecera Kunstmann S.A. signed a bank loan with Banco Estado for a total of ThCh$ 500,000, maturing on April 25, 2013. Subsequently this loan was renewed for one year, maturing on April 25, 2014. It was renewed for one year, maturing on April 25, 2015. Subsequently this loan was renewed for one year, maturing on April 27, 2016.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest and capital amortization consists of a single payment at the end of the established term.

On April 27, 2016, this loan was paid.

c) On April 25, 2013, the subsidiary Compañía Cervecera Kunstmann S.A. signed a bank loan with Banco Estado for a total of ThCh$ 600,000, maturing on April 25, 2014. It was renewed for one year, maturing on April 25, 2015. Subsequently this loan was renewed for one year, maturing on April 27, 2016.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest and capital amortization consists of a single payment at the end of the established term.

On April 27, 2016, this loan was paid.

d) On June 16, 2014, the subsidiary Viña San Pedro Tarapacá S.A. signed a bank loan with Banco Estado for a total of 6,200,000 euros, maturing on June 16, 2015.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest and capital amortization consists of a single payment at the end of the established term.

On June 17, 2015, payment of the loan was made.

e) On October 15, 2014, the subsidiary Viña San Pedro Tarapacá S.A. signed a bank loan with Banco Estado for a total of UF 380,000, maturing on October 15, 2019.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest semi-annually and capital amortization consists of a single payment at the end of the established term.

f) On December 3, 2014, the subsidiary Compañía Cervecera Kunstmann S.A. signed a bank loan with Banco Estado for a total of ThCh$ 1,300,000, maturing on March 31, 2015.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest and capital amortization consists of a single payment at the end of the established term.

On May 29, 2015 the loan was renewed for a term of 3 months, maturing on July 28, 2015.

On July 17, 2015, payment of the loan was made.

g) On July 15, 2015, the subsidiary Compañía Cervecera Kunstmann S.A. signed a bank loan with Banco Estado for a total of ThCh$ 4,000,000, maturing on July 14, 2020.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest and capital amortization consists of a single payment at the end of the established term.

h) On May 26, 2016, the subsidiary Aguas CCU-Nestlé Chile S.A. signed a bank loan with Banco Estado for a total of ThCh$ 5,300,000, maturing on November 22, 2016.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest and capital amortization consists of a single payment at the end of the established term.

On November 22, 2016, payment of the loan was made.

F-93

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Banco de Chile – Bank Loans

a) On July 11, 2011, the subsidiary Viña San Pedro Tarapacá S.A. signed a bank loan with Banco de Chile for a total of US$ 4,436,100, maturing on July 11, 2016.

This loan accrues interest at a compound floating rate Libor plus 180 days plus a fixed margin. The subsidiary amortizes interest semi-annually, and capital amortization consists of a single payment at the end of the established term.

This debt was changed to Euros and a fixed interest rate through a currency US$-Euro and interest rate swap agreements (Cross Currency Interest Rate Swap). For details of the Company`s hedge strategies see Note 5 and 6.

On July 11, 2016, payment of the loan was made.

b) On July 7, 2011, the subsidiary Viña San Pedro Tarapacá S.A. signed a bank loan with Banco de Chile for a total of US$ 10,000,000, maturing on July 7, 2016.

This loan accrues interest at a compound floating rate Libor plus 180 days plus a fixed margin. The subsidiary amortizes interest semi-annually, and capital amortization consists of a single payment at the end of the established term.

The interest rate risk to which the subsidiary is exposed as result of this loan is mitigated by the use of cross interest rate swap agreements (interest rate fixed). For details of the Company`s hedge strategies see Note 5 and 6.

On July 7, 2016, payment of the loan was made.

The aforementioned loans oblige the Company to comply with the same covenants as the Series A Bond as indicated in letter D) Restrictions in this Note.

c) On July 7, 2016, the subsidiary Compañía Cervecera Kunstmann S.A. signed a bank loan with Banco de Chile for a total of ThCh$ 7,271,000, maturing on July 2, 2017.

This loan accrued interest at an annual rate. The subsidiary amortizes interest and capital consists of a single payment at the end of the established term.

This debt was changed to Euros and a fixed interest rate through a currency CLP-US$ and interest rate swap agreements (Cross Currency Interest Rate Swap). For details of the Company`s hedge strategies see Note 5 and 6.

d) On April 24, 2014, the subsidiary Compañía Cervecera Kunstmann S.A. signed a bank loan with Banco de Chile for a total of ThCh$ 1,000,000, maturing on April 24, 2015.

This loan accrued interest at an annual rate. The subsidiary amortizes interest and capital consists of a single payment at the end of the established term.

On April 24, 2015 the loan was renewed for a term of 1 year, maturing on April 21, 2016.

On April 22, 2016, payment of the loan was made.

e) On April 24, 2015, the subsidiary Compañía Cervecera Kunstmann SA He signed a bank loan with Banco de Chile for a total of ThCh$ 600,000 for a period of three months expiring on July 24, 2015.

This loan bears interest at a fixed interest rate. The subsidiary pays the interest and principal in a single payment at the end of the deadline.

On July 24, 2015, payment of the loan was made.

f) On April 20, 2016, the subsidiary Compañía Cervecera Kunstmann S.A. signed a bank loan with Banco de Chile for a total of ThCh$ 2,000,000, maturing on April 20, 2018.

This loan accrued interest at an annual rate. The subsidiary amortizes interest and capital consists of a single payment at the end of the established term.

F-94

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

g) On August 25, 2016, the subsidiary Compañía Cervecera Kunstmann S.A. signed a bank loan with Banco de Chile for a total of ThCh$ 400,000, maturing on August 24, 2018.

This loan accrued interest at an annual rate. The subsidiary amortizes interest and capital consists of a single payment at the end of the established term.

Banco Scotiabank – Bank Loans

a) On June 21, 2013, the subsidiary Viña San Pedro Tarapacá S.A. signed a bank loan with Banco Scotiabank for a total of US$ 8,000,000, maturing on June 22, 2015.

This loan accrues interest at a compound floating rate Libor plus 90 days plus a fixed margin. The subsidiary amortizes interest quarterly and capital amortization consists of a single payment at the end of the established term.

The interest rate risk to which the subsidiary is exposed as result of this loan is mitigated by the use of cross interest rate swap agreements (interest rate fixed). For details of the Company`s hedge strategies see Note 5 and 6.

On June 22, 2015, payment of the loan was made.

b) On September 4, 2014, the subsidiary Compañía Cervecera Kunstmann S.A. signed a bank loan with Banco Scotiabank for a total of US$ 638,674, maturing on September 4, 2016.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest semi-annually and capital amortization consists of a single payment at the end of the established term.

On August 24, 2016, payment of the loan was made.

c) On June 17, 2015, the subsidiary Viña San Pedro Tarapacá S.A. it signed a bank loan with Scotiabank for a total of US$ 7,871,500, with a term of three years maturing on June 18, 2018.

This loan bears interest at a floating interest rate composed dollar Libor at 90 days plus a fixed margin. The company pays quarterly interest and amortization of capital consists of a single payment at the end of the deadline.

The interest rate risk to which the subsidiary is exposed as result of this loan is mitigated by the use of cross interest rate swap agreements (interest rate fixed). For details of the Company`s hedge strategies see Note 5 and 6.

The aforementioned loans oblige the Company to comply with the covenants indicated in letter D) Restriction in this Note.

d) On April 24, 2015, the subsidiary Compañía Cervecera Kunstmann SA He signed a bank loan with Scotiabank for a total of US$ 1,000,000, with a term of one year expiring at April 22, 2016.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest semi-annually and capital amortization consists of a single payment at the end of the established term.

On April 22, 2016, payment of the loan was made.

e) On April 20, 2016, the subsidiary Compañía Cervecera Kunstmann SA He signed a bank loan with Scotiabank for a total of ThCh$ 2,000,000, with a term of one year expiring at April 20, 2017.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest semi-annually and capital amortization consists of a single payment at the end of the established term.

F-95

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Banco Santander Chile – Bank Loans

a) On June 17, 2013, the subsidiary Viña San Pedro Tarapacá S.A. signed a bank loan with Banco Santander Chile for a total of US$ 8,000,000, maturing on June 17, 2014.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest and capital amortization consists of a single payment at the end of the established term.

On June 17, 2014, this loan was paid.

b) On June 17, 2013, the subsidiary Viña San Pedro Tarapacá S.A. signed a bank loan with Banco Santander Chile for a total of 6,200,000 Euros, maturing on June 17, 2014.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest and capital amortization consists of a single payment at the end of the established term.

On June 17, 2014, this loan was paid.

BBVA Banco Francés S.A.; HSBC Bank Argentina S.A.; Banco de Galicia y Buenos Aires S.A.; La Sucursal de Citibank NA established in Argentinian Republic; Banco de La Provincia de Buenos Aires – Syndicated Bank Loan with Compañía Industrial Cervecera S.A. (CICSA)

On October 5, 2012, the subsidiary CICSA signed a syndicated bank loan for a total of 187.5 million Argentine Pesos, maturing on October 5, 2015.

The proportional participation of banks lenders is as follows:

a) BBVA Bank French S.A., with 55 million Argentine Pesos of pro rata participation.

b) Banco de la Provincia de Buenos Aires, with 54 million Argentine Pesos.

c) HSBC Bank Argentina S.A., with 43.5 million Argentine Pesos of pro rata participation.

d) Banco de Galicia y Buenos Aires S.A., with 20 million Argentine Pesos of pro rata participation.

e) Citibank NA established in Argentinian Republic, with 15 million Argentine Pesos of pro rata participation.

This loan accrues interest at an annual rate of 15.01% whose payment is made monthly. The subsidiary amortizes capital in 9 consecutive and equal quarterly quotes, once the grace period of 12 months from the date of disbursement.

This loan obliges the subsidiary to meet specific requirements and financial covenants related to their Consolidated Financial Statements, which according to agreement of the parties are as follows:

a) Maintain a capability of repayment measure at the end of each quarter less than or equal to 3, calculated as the financial debt over Adjusted EBITDA1. Adjusted EBITDA means EBITDA as calculated by the Company in accordance with particular debt instruments in order to measure such instruments’ financial covenants and is defined as: Operating result before Interest, Income taxes, Depreciation and Amortization for the period of 12 months immediately prior to the date of calculation.

b) Maintain a Financial Expense Coverage measured at the end of each quarter and retroactively for periods of 12 months, not less than 2.5, calculated as the ratio of Adjusted EBITDA (as defined in paragraph (a)) and Financial Costs account.

c) Maintain at the end of each quarter an indebtedness ratio not higher than 1.5, defined as the ratio Financial Liabilities over the Equity meaning the Equity at the time of calculation, as it arises from their Financial Statements and in accordance with generally accepted accounting principles in the Argentinian Republic.

d) Maintain at the end of each quarter a minimum Equity of 600 million of Argentine Pesos.

1 EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization).

F-96

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

As of December 31, 2016, the Company was in compliance with the financial covenants and specific requirements of this loan.

Banco de la Nación Argentina – Bank Loan with Compañía Industrial Cervecera S.A. (CICSA)

a) On December 28, 2012, CICSA signed a bank loan for a total of 140 million of Argentine pesos for a period of 7 years, maturing on November 26, 2019, and whose loan is delivered in two stages, where the first was carried out on December 28, 2012, for a total of 56 million argentine pesos and the second on June 28, 2013, for a total of 84 million of Argentine pesos.

This loan accrues interest at an annual rate of 15% fixed by first 36 months. Having completed that term, accrues interest at a compound floating rate BADLAR in pesos plus a fixed spread of 400 basis points and to this effect will be taken BADLAR rate published by the Central Bank of the Argentina Republic, corresponding to five working days prior to the start of the period, subject to the condition that does not exceed the lending rate of portfolio general of Banco de la Nación Argentina, in whose case shall apply this.

The subsidiary amortizes capital in 74 consecutive and equal, once the grace period of 10 months from the date of disbursement.

This loan is guaranteed by CCU S.A., through a Stand By issued by the Banco Estado de Chile in favor of Banco de la Nación Argentina (see Note 34).

b) On April 20, 2015, the subsidiary CICSA signed a bank loan for a total of 24 million of argentine pesos, maturing on April 4, 2018.

This loan accrues interest at a compound floating rate BADLAR in pesos plus a fixed spread of 500 basis points and subject to the condition that does not exceed the lending rate of portfolio general of Banco de la Nación Argentina, in whose case shall apply this.

The subsidiary amortizes capital in 30 monthly, once the grace period of 6 months from de date of disbursement.

This loan is guaranteed by CCU S.A., through a Stand By issued by the Banco Estado de Chile (see Note 34).

c) On June 26, 2015, the subsidiary CICSA signed a bank loan for a total of 30 million of argentine pesos, maturing on December 26, 2015.

This loan accrues a fixed interest at an annual rate of 23%. The subsidiary amortizes monthly interest and the capital amortization in 6 monthly.

Banco BBVA Francés S.A. – Bank Loan with Compañía Industrial Cervecera S.A. (CICSA)

On June 18, 2014, the subsidiary CICSA signed a bank loan with BBVA Bank for a total of 90 million argentine pesos, maturing on June 19, 2017.

This loan accrues a fixed interest at an annual rate. The subsidiary amortizes interest and capital amortization quarterly.

Banco de Galicia y Buenos Aires S.A.; Banco Santander Río S.A.; – Syndicated Bank Loan with Compañía Industrial Cervecera S.A. (CICSA)

On April 20, 2015, the subsidiary CICSA signed a syndicated bank loan for a total of 150 million argentine pesos, maturing on April 20, 2018.

The proportional participation of banks lenders is as follows:

(a) Banco de Galicia y Buenos Aires S.A., with 75 million argentine pesos of pro rata participation.

(b) Banco Santander Río, with 75 million argentine pesos of pro rata participation.

F-97

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

This loan accrues interest at an annual rate of 29.4% fixed by first 12 months and thereafter accrues interest at a compound floating rate BADLAR in pesos plus a fixed spread of 360 basis points and the payments will be quarterly. The capital amortization will payment in 9 quarterly, once the grace period of 12 months from de date of disbursement.

This loan obliges the subsidiary to meet specific requirements and financial covenants related to their Consolidated Financial Statements, which according to agreement of the parties are as follows:

a) Maintain a capability of repayment measure at the end of each quarter less than or equal to 3, calculated as the financial debt over Adjusted EBITDA2. Adjusted EBITDA means EBITDA as calculated by the Company in accordance with particular debt instruments in order to measure such instruments’ financial covenants and is defined as: Operating result before Interest, Income taxes, Depreciation and Amortization for the period of 12 months immediately prior to the date of calculation.

b) Maintain a Financial Expense Coverage measured at the end of each quarter and retroactively for periods of 12 months, not less than 2.5, calculated as the ratio of Adjusted EBITDA (as defined in paragraph (a)) and Financial Costs account.

c) Maintain at the end of each quarter an indebtedness ratio not higher than 1.5, defined as the ratio Financial Liabilities over the Equity meaning the Equity at the time of calculation, as it arises from their Financial Statements and in accordance with generally accepted accounting principles in the Argentinian Republic.

d) Maintain at the end of each quarter a minimum Equity of 600 million of Argentine Pesos.

As of December 31, 2016, the Company was in compliance with the financial covenants and specific requirements of this loan.

B) Financial Lease Obligations

The most significant financial lease agreements are as follows:

CCU S.A.

In December, 2004, the Company sold a piece of land previously classified as investment property. As part of the transaction, the Company leased eleven floors of a building under construction on the mentioned piece of land.

The building was completed during 2007, and on June 28, 2007, the Company entered into a 25-years lease agreement with Compañía de Seguros de Vida Consorcio Nacional de Seguros S.A., for a total amount of UF 688,635.63, with an annual interest rate of 7.07%. The current value of the agreement amounted to ThCh$ 10,403,632 as of December 31, 2007. The agreement also grants CCU the right or option to acquire the assets contained in the agreement (real estate, furniture and facilities) as from month 68 of the lease. The lease rentals committed are according to the conditions prevailing in the market. For Chilean GAAP purposes, in 2004 the Company recognized a ThCh$ 3,108,950 gain for the building portion not leased by the Company, and a ThCh$ 2,276,677 liability deferred through completion of the building, when the Company recorded the transaction as financial lease.

2 EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization).

F-98

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Compañía Cervecera Kunstmann S.A., Manantial S.A. and Finca La Celia S.A.:

Other lease agreements are as follows:

Type | Institution | Contract Date | Currency | ThCh$ | Number of quotas | Annual Interest | Purchase option (UF)
Compañía Cervecera Kunstmann S.A.
Production Plant | Banco de Chile | 19-04-05 | UF | 20.489 | 168 | 8.30% | 302
Land Lote 2C | Banco de Chile | 26-06-07 | UF | 7.716 | 121 | 5.80% | 85
Land Lote 2D | Banco de Chile | 25-03-08 | UF | 15.000 | 97 | 4.30% | 183
Land Lote 13F1 | Banco Estado | 10-10-12 | UF | 22.341 | 72 | 4.33% | 348
Manantial S.A.
Dispensers | Banco de Crédito e Inversiones | 04-01-12 | UF | 4.275 | 37 | 5.06% | 116
Dispensers | Banco de Chile | 05-12-11 | UF | 1.073 | 37 | 5.98% | 311
Vehicles | Banco de Chile | 27-08-12 | UF | 1.265 | 25 | 12.63% | 51
Computers | Banco Security | 23-08-11 | UF | 2.387 | 37 | 6.99% | 65
Dispensers | Banco Security | 09-08-11 | UF | 20.845 | 37 | 6.62% | 563
Finca La Celia S.A.
Automotor | Banco Supervielle | 10-06-14 | $ARG | 10.814 | 45 | 17.50% | 6.250

The following is a detail of future payments and the current value of the financial lease obligations as of December 31, 2015:

Lease Minimum Future Payments | As of December 31, 2016
Gross Amount | Interest | Amount
ThCh$ | ThCh$ | ThCh$
0 to 3 months | 368,052 | 302,964 | 65,088
3 months to 1 year | 1,050,810 | 899,948 | 150,862
Over 1 year to 3 years | 2,603,315 | 2,377,942 | 225,373
Over 3 years to 5 years | 2,305,704 | 2,161,799 | 143,905
Over 5 years | 28,638,952 | 11,507,311 | 17,131,641
Total | 34,966,833 | 17,249,964 | 17,716,869

F-99

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

C) Bonds Payable

Series A Bonds – Subsidiary Viña San Pedro Tarapacá S.A.

On June 13, 2005, the subsidiary Viña San Pedro Tarapacá S.A. recorded in the Securities Record a bond issue for a total UF 1,500,000 at a 20-years term maturing on July 15, 2025. Such issue was placed in the local market on July 20, 2005, with a premium amounting to ThCh$ 227,378. This obligation accrues interest at a fixed annual rate of 3.8% and amortizes interest and capital semi-annually.

On December 17, 2010, took place the Board of Bondholders Serie A, which decided to modify the issued Contract of such bonds in order to update certain references and adapt it to the new IFRS accounting standards. The amendment of the issued Contract is dated December 21, 2010 and has the repertory No. 35739-2010 in the Notary of Ricardo San Martín Urrejola. Because of these changes, the commitment of this subsidiary is to comply with certain financial ratios that will be calculated only on the Consolidated Financial Statements. These financial ratios and other conditions are describe in letter D).

On July 21, 2011 the subsidiary made a partial prepayment for 750 Series A Bonds (of the 1,500 issued) equivalent to UF 513,750, according to Section Twelve of Clause Four for the Issue Contract Bond issued by public deed dated April 28, 2005. Additionally, the subsidiary recognized in the Consolidated Income Statement of that date an expenditure of ThCh$ 103,735, for expenses associated with the issuance of this debt.

On November 7, 2014, the subsidiary made a total prepayment for Series A Bonus for an amount of ThCh$ 9,778,759 and recognized in the Consolidated Income Statement of that date an expenditure of ThCh$ 117,200.

At the time of this total prepayment, the subsidiary was in compliance with the financial covenants required for this public issue detailed in letter D).

Series E Bonds – CCU S.A.

On October 18, 2004, under number 388 the Company recorded in the Securities Record the issue of 20-year term public bonds for a total UF 2,000,000 maturing on December 1, 2024. This issue was placed in the local market on December 1, 2004, with a discount amounting to ThCh$ 897,857. This obligation accrues interests at a fixed annual rate of 4.0%, and it amortizes interest and capital semi-annually.

On December 17, 2010, took place the Board of Bondholders Serie E, which decided to modify the issued Contract of those bonds in order to update certain references and adapt it to the new IFRS accounting standards. The amendment of the issued Contract is dated December 21, 2010 and has the repertory No. 35738-2010 in the Notary of Ricardo San Martín Urrejola. Because of these changes, the commitment of the Company is to comply with certain financial ratios that will be calculated only on the Consolidated Financial Statements. These financial ratios and other conditions are as follows:

(a) Maintain at the end of each quarter an indebtedness ratio measured over the consolidated financial statements not higher than 1.5, defined as the ratio of Total Adjusted Liabilities and Total Adjusted Equity. Total Adjusted Liabilities is defined as Total Liabilities less Dividends provisioned, according to policy included in the Statement of Changes in Equity, plus the amount of all guarantees granted by the Issuer or its subsidiaries that are cautioned by real guarantees, except as noted in the contract. Total Adjusted Equity is defined as Total Equity plus Dividends provisioned, according to policy included in the Statement of Changes in Equity.

(b) Maintain a Financial Expense Coverage measured at the end of each quarter and retroactively for periods of 12 months, not less than 3, calculated as the ratio of Adjusted EBITDA and Financial Costs account. Adjusted EBITDA means EBITDA as calculated by the Company in accordance with particular debt instruments in order to measure such instruments’ financial covenants and is defined as: (i) the sum of Gross Margin and Other income by function accounts; (ii) less (absolute numbers) Distribution costs, Administrative expenses and Other expenses by function accounts; and (iii) plus (absolute numbers) Depreciation and Amortization recorded on the Note Nature of the costs and expenses.

(c) Maintain at the end of each quarter, assets free of liens for an amount equal to at least 1.2, defined as the ratio of Total Assets free of lien and Total Adjusted Liabilities free of lien. Is defined as Total Assets free of lien are defined as Total Assets less assets pledged as collateral for cautioned obligations of third parties. Total Adjusted Liabilities free of lien are defined as Total Liabilities less Dividends provisioned according to policy contained in the Statement of Changes in Equity.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

(d) Maintain at the end of each quarter a minimum equity of ThCh$ 312,516,750, meaning Equity Attributable to Equity Holders of the Parent plus the Dividends provisioned account, according to policy contained in the Statement of Changes in Equity. This requirement will increase in the amount resulting from each revaluation of property, plant and equipment to be performed by the Issuer.

(e) To maintain, either directly or indirectly, ownership over more than 50% of the subscribed and paid-up shares and over the voting rights of the following companies: Cervecera CCU Chile Limitada, Embotelladoras Chilenas Unidas S.A. and Viña San Pedro Tarapacá S.A., except in the cases and under the terms established in the agreement.

(f) To maintain, either directly or through a subsidiary, ownership of the trademark "CRISTAL", denominative for beer class 32 of the international classifier, and not to transfer its use, except to its subsidiaries.

(g) Not to make investments in facilities issued by related parties, except in the cases and under the terms established in the agreement.

(h) Neither sells nor transfer assets from the issuer and its subsidiaries representing over 25% of the assets total of the consolidated financial statements.

As of December 31, 2016 and December 31, 2015, the Company was in compliance with the financial covenants required for this public issue.

Series H and I Bonds – CCU S.A.

On March 23, 2009, the Company recorded in the Securities Record the issue of bonds Series H and I for a combined total of UF 5 million, with 5 and 21 years terms, respectively. Emissions of both series were placed in the local market on April 2, 2009. The issuance of the Bond I was UF 3 million with maturity on March 15, 2014, with a discount amounting to ThCh$ 413,181, and accrues interest at an annual fixed rate of 3.0%, with amortize interest semi-annually and excluding the capital (bullet). The issuance of the Bond H was UF 2 million with maturity on March 15, 2030, with a discount amounting to ThCh$ 156,952, and accrues interest at an annual fixed rate of 4.25%, with amortizes interest and capital semi-annually.

By deed dated December 27, 2010 issued in the Notary of Ricardo San Martín Urrejola, under repertoires No. 36446-2010 and 36447-2010, were amended Issue Contract Series H and I, respectively, in order to update certain references and to adapt to the new IFRS accounting rules.

The current issue was subscribed with Banco Santander Chile as representative of the bond holders and as paying bank, and it requires that the Company complies with the following financial covenants on its Consolidated Financial Statements and other specific requirements:

(a) Maintain at the end of each quarter an indebtedness ratio measured over the consolidated financial statements not higher than 1.5, defined as the ratio of Total Adjusted Liabilities and Total Adjusted Equity. The Total Adjusted Liabilities are defined as Total Liabilities less Dividends provisioned, according to policy included in the Statement of Changes in Equity, plus the amount of all guarantees, debts or obligations of third parties not within the liability and outside the Issuer or its subsidiaries that are cautioned by real guarantees granted by the Issuer or its subsidiaries. Total Adjusted Equity is defined as Total Equity plus Dividends provisioned account, according to policy included in the Statement of Changes in Equity.

(b) Maintain a Financial Expense Coverage measured at the end of each quarter and retroactively for periods of 12 months, not less than 3, calculated as the ratio of Adjusted EBITDA and Financial Costs account. Adjusted EBITDA means EBITDA as calculated by the Company in accordance with particular debt instruments in order to measure such instruments’ financial covenants and is defined as: (i) the sum of Gross Margin and Other income by function accounts; (ii) less (absolute numbers) Distribution costs, Administrative expenses and Other expenses by function accounts; and (iii) plus (absolute numbers) Depreciation and Amortization recorded on the Note Nature of the cost and expenses.

(c) Maintain at the end of each quarter, assets free of liens for an amount equal to, at least, 1.2, defined as the ratio of Total Assets free of lien and Financial Debt free of lien. Total Assets free of lien are defined as Total Assets less assets pledged as collateral for cautioned obligations of third parties. Financial Debt free of lien is defined as the sum of lines Bank Loans, Bonds payable and Finance lease obligations contained in Note Other financial liabilities of the Consolidated Financial Statements.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

(d) Maintain at the end of each quarter a minimum equity of ThCh$ 312,516,750, meaning Equity Attributable to Equity Holders of the Parent plus the Dividends provisioned account, according to policy included in the Statement of Changes in Equity. This requirement will increase in the amount resulting from each revaluation of property, plant and equipment to be performed by the Issuer.

(e) To maintain, either directly or indirectly, ownership over more than 50% of the subscribed and paid-up shares and over the voting rights of the following companies: Cervecera CCU Chile Limitada and Embotelladoras Chilenas Unidas S.A.

(f) Maintain a nominal installed capacity for the production manufacturing of beer and soft drinks, equal or higher altogether than 15.9 million hectolitres a year, except in the cases and under the terms of the contract.

(g) To maintain, either directly or through a subsidiary, ownership of the trademark "CRISTAL", denominative for beer class 32 of the international classifier, and not to transfer its use, except to its subsidiaries.

(h) Not to make investments in facilities issued by related parties, except in the cases and under the terms established in the agreement.

On March 17, 2014, the Company paid the total Serie I Bonds, equivalent UF 3,000,000.

As of December 31, 2016 and December 31, 2015, the Company was in compliance with the financial covenants required for this public issue.

D) Restriction of subsidiary Viña San Pedro Tarapacá S.A.

The subsidiary Viña San Pedro Tarapacá S.A. must comply with certain financial ratios that will be calculated only on its Consolidated Financial Statements. These financial ratios and other conditions are as follows:

(a) Control over subsidiaries representing at least 30% of the consolidated Adjusted EBITDA of the issuer. Adjusted EBITDA. Adjusted EBITDA means EBITDA as calculated by the Company in accordance with particular debt instruments in order to measure such instruments’ financial covenants and is defined as: (i) the sum of Gross Margin and Other income by function accounts; (ii) less (absolute numbers) Distribution costs, Administrative expenses and Other expenses by function accounts; and (iii) plus (absolute numbers) Depreciation and Amortization recorded in the Note Nature of the costs and expenses.

(b) Not to enter into investments in instruments issued by related parties different from its subsidiaries.

(c) Neither sells nor transfers essential assets that jeopardize the continuance of its current purpose.

(d) Maintain at the end of each quarter an indebtedness ratio measured over the consolidated financial statements not higher than 1.2, defined as the ratio of Total Adjusted Liabilities and Total Adjusted Equity. The Total Adjusted Liabilities is defined as Total Liabilities less Dividends provisioned, according to policy contained in the Statement of Changes in Equity, plus the amount of all guarantees, debts or obligations of third parties not within the liabilities and outside the Issuer or its subsidiaries that are cautioned by real guarantees granted by the Issuer or its subsidiaries. Total Adjusted Equity is defined as Total Equity plus Dividends provisioned, according to policy contained in the Statement of Changes in Equity.

(e) Maintain a Financial Expense Coverage measured at the end of each quarter and retroactively for periods of 12 months, not less than 3, calculated as the ratio of Adjusted EBITDA (as defined in paragraph (a)) and Financial Costs account.

(f) Maintain at the end of each quarter a minimum equity of ThCh$ 83,337,800, meaning Equity Attributable to Equity Holders of the Parent plus the Dividends provisioned account, according to policy included in the Statement of Changes in Equity. This requirement will increase in the amount resulting from each revaluation of property, plant and equipment to be performed by the Issuer.

As of December 31, 2016 and December 31, 2015, the subsidiary was in compliance with the financial covenants required for this public issue.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 27 Accounts payable – trade and other payables

As of December 31, 2016 and 2015, the total Accounts payable-trade and other payables are as follows:

| As of December 31, 2016 | As of December 31, 2015
| Current | Non current | Current | Non current
| ThCh$ | ThCh$ | ThCh$ | ThCh$
Suppliers | 210,160,789 | - | 179,926,026 | -
Notes payable | 2,121,496 | 1,082,898 | 3,930,657 | 1,645,098
Withholdings payable | 47,395,567 | - | 43,880,120 | -
Total | 259,677,852 | 1,082,898 | 227,736,803 | 1,645,098

# Note 28 Provisions

As of December 31, 2016 and 2015, the total provisions recorded in the consolidated statement of financial position are as follows:

| As of December 31, 2016 | As of December 31, 2015
Current | Non current | Current | Non current
ThCh$ | ThCh$ | ThCh$ | ThCh$
Litigation | 409,164 | 839,079 | 503,440 | 839,934
Others | - | 484,441 | - | 636,584
Total | 409,164 | 1,323,520 | 503,440 | 1,476,518

The following was the change in provisions during the years ended December 31, 2015 and 2016:

| Litigation (1) | Others | Total
ThCh$ | ThCh$ | ThCh$
As of January 1, 2015 |  | 1,023,895 |  | 1,596,196 | 2,620,091
As of December 31, 2015 |  |  |  |  |
Incorporated |  | 792,724 |  | 888 | 793,612
Used |  | (222,139) |  | - | (222,139)
Released |  | (31,005) |  | (801,778) | (832,783)
Conversion effect |  | (220,101) |  | (158,722) | (378,823)
As of December 31, 2015 |  | 1,343,374 |  | 636,584 | 1,979,958
As of December 31, 2016 |  |  |  |  |
Incorporated |  | 551,167 |  | 22,219 | 573,386
Used |  | (267,704) |  | (14,173) | (281,877)
Released |  | (124,336) |  | (67,271) | (191,607)
Conversion effect |  | (254,258) |  | (92,918) | (347,176)
As of December 31, 2016 |  | 1,248,243 |  | 484,441 | 1,732,684

(1) See Note 34.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The maturities of provisions at December 31, 2016, were as follows:

| Litigation | Others | Total
ThCh$ | ThCh$ | ThCh$
Less than one year |  | 409,164 |  | - | 409,164
Between two and five years |  | 423,863 |  | 484,441 | 908,304
Over five years |  | 415,216 |  | - | 415,216
Total |  | 1,248,243 |  | 484,441 | 1,732,684

Litigation

The detail of significant litigation proceedings to which the Company is exposed at a consolidated level is described in Note 34.

Management believes based on the development of such proceedings to date, the provisions established on a case by basis are adequate to cover the eventual adverse effects that could arise from these proceedings.

# Note 29 Other non-financial liabilities

As of December 31, 2016 and 2015, the total Other non-financial liabilities are as follows:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Parent dividend provisioned by the board | 24,387,190 | 24,387,190
Parent dividend provisioned according to policy | 34,841,553 | 36,016,878
Outstanding parent dividends | 915,585 | 723,259
Subsidiaries dividends according to policy | 11,192,210 | 9,725,015
Others | 33,434 | 89,802
Total | 71,369,972 | 70,942,144
Current | 71,369,972 | 70,942,144
Total | 71,369,972 | 70,942,144

# Note 30 Employee Benefits

The Company grants short term and employment termination benefits as part of its compensation policies.

The Parent Company and its subsidiaries maintain collective agreements with their employees, which establish the compensation and/or short–term and long-term benefits for their staff, the main features of which are described below:

i. Short-term benefits are generally based on combined plans or agreements, designed to compensate benefits received, such as paid vacation, annual performance bonuses and compensation through annuities.

ii. Long-term benefits are plans or agreements mainly intended to cover the post-employment benefits generated at the end of the labour relationship, be it by voluntary resignation or death of personnel hired.

The cost of such benefits is charged against income, in the “Personnel Expense” item.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

As of December 31, 2016 and 2015, the total staff benefits recorded in the Consolidated Statement of Financial Position is as follows:

Employees’ Benefits | As of December 31, 2016 | As of December 31, 2015
Current | Non current | Current | Non current
ThCh$ | ThCh$ | ThCh$ | ThCh$
Short term benefits | 22,517,220 | - | 21,617,103 | -
Employment termination benefits | 321,008 | 21,832,415 | 94,956 | 18,948,603
Total | 22,838,228 | 21,832,415 | 21,712,059 | 18,948,603

Employees’ Bonuses

Short-term benefits are mainly comprised of recorded vacation (on accruals basis), bonuses and share compensation. Such benefits are recorded when the obligation is accrued and are usually paid within a 12-month periods, consequently, they are not discounted.

As of December 31, 2016 and 2015, the total short-term benefits recorded in the Consolidated Statement of Financial Position are as follows:

Short-Term Employees’ Benefits | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
Vacation | 9,405,040 | 8,442,610
Bonus and compensation | 13,112,180 | 13,174,493
Total | 22,517,220 | 21,617,103

The Company records the staff vacation cost on an accrual basis.

Severance Indemnity

The Company records a liability for the payment of an irrevocable severance indemnity, originated by collective and individual agreements entered into with certain groups of employees. Such obligation is determined by means of the current value of the benefit accrued cost, a method that considers several factors for the calculation such as estimates of future continuance, mortality rates, future salary increases and discount rates. The Company periodically evaluates the above-mentioned factors based on historical data and future projections, making adjustments that apply when checking changes sustained trend. The so-determined value is presented at the current value by using the severance benefits accrued method. The discount rate is determined by reference to market interest rates curves for high quality entrepreneurial bonds. The discount rate in Chile was 5.52% (6.36% in 2015) and in Argentina 31.88% (39.26% in 2015).

As of December 31, 2016, the obligation recorded for severance indemnity is as follows:

Severance Indemnity | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
Current | 321,008 | 94,956
Non-current | 21,832,415 | 18,948,603
Total | 22,153,423 | 19,043,559

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The change in the severance indemnity during the year ended as of December 31, 2015 and 2016 was as follows:

Severance Indemnity | Severance Indemnity
ThCh$
Balance as of January 1, 2015 | 17,437,221
Current cost of service | 1,023,969
Interest cost | 1,703,107
Actuarial loss | 947,153
Paid-up benefits | (1,700,491)
Past service cost | 131,204
Others | (498,604)
Movements of the year | 1,606,338
As of December 31, 2015 | 19,043,559
Current cost of service | 1,650,484
Interest cost | 1,702,662
Actuarial loss | 2,342,336
Paid-up benefits | (2,490,851)
Past service cost | 342,039
Conversion effect | (670,709)
Others | 233,903
Movements of the year | 3,109,864
As of December 31, 2016 | 22,153,423

The figures recorded in the Consolidated Statement of Income as of December 31, 2016, 2015 y 2014, are as follows:

Expense recognized for severance indemnity | For the years ended as of December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Current cost of service | 1,650,484 | 1,023,969 | 601,053
Past service cost | 342,039 | 131,204 | 1,090,429
Non-provided paid benefits | 7,851,201 | 4,377,570 | 5,916,192
Other | 1,114,112 | 646,502 | 335,808
Total expense recognized in Consolidated Statement of Income | 10,957,836 | 6,179,245 | 7,943,482

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Actuarial Assumptions

As mentioned in Note 2.20 – Employees’ Benefits, the severance payment obligation is recorded at its actuarial value. The main actuarial assumptions used for the calculation of the severance indemnity obligation as of December 31, 2016 and 2015, are as follows:

Actuarial Assumptions | Chile | Argentina
As of December 31, | As of December 31, | As of December 31, | As of December 31,
2016 | 2015 | 2016 | 2015
Mortality table | RV-2014 | RV-2004 | Gam '83 | Gam'83
Annual interest rate | 5.52% | 6.36% | 31.88% | 39.26%
Voluntary employee turnover rate | 1.9% | 1.9% | “ESA 77 Ajustada - 50%” | “ESA 77 Ajustada - 50%”
Company’s needs rotation rate | 5.3% | 5.3% | “ESA 77 Ajustada - 50%” | “ESA 77 Ajustada - 50%”
Salary increase (*) | 3.7% | 3.7% | 26.25% | 33.32%
Estimated retirement age for (*) | Officers |  | 60 | 60 | 60 | 60
Other | Male | 65 | 65 | 65 | 65
Female | 60 | 60 | 60 | 60

Sensitivity Analysis

The Following is a sensitivity analysis based on increased (decreased) of 1 percent on the discount rate:

Sensitivity Analysis | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
1% increase in the Discount Rate (Gain) | 1,421,484 | 1,164,165
1% decrease in the Discount Rate (Loss) | (1,649,255) | (1,344,213)

Personnel expense

The amounts recorded in the Consolidated Statement of Income for the years ended as of December 31, 2016, 2015 and 2014, are as follows:

Personnel expense | For the years ended as of December 31,
2016 | 2015 | 2014
ThCh$ | ThCh$ | ThCh$
Salaries | 145,766,757 | 138,359,074 | 119,623,310
Employees’ short-term benefits | 23,189,206 | 24,693,325 | 18,128,043
Employments termination benefits | 10,957,836 | 6,179,245 | 7,943,482
Other staff expense | 30,971,754 | 28,683,507 | 23,636,629
Total (1) | 210,885,553 | 197,915,151 | 169,331,464

(1) See Note 9.

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# Note 31 Non-controlling Interests

The detail of Non-controlling Interests is the following:

a. Equity

Equity | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
Viña San Pedro Tarapacá S.A. | 75,092,267 | 72,512,897
Bebidas del Paraguay S.A. | 17,828,260 | 20,403,140
Aguas CCU-Nestlé Chile S.A. | 16,440,129 | 19,891,176
Compañía Cervecera Kunstmann S.A. | 5,740,305 | 4,979,490
Compañía Pisquera de Chile S.A. | 4,717,811 | 4,699,612
Manantial S.A. (1) | - | 3,767,028
Saenz Briones & Cía. S.A. | 799,111 | 962,286
Distribuidora del Paraguay S.A. | 2,197,241 | 1,949,490
Los Huemules S.R.L. (1) | - | 395,469
Other | 179,300 | 145,185
Total | 122,994,424 | 129,705,773

(1) See Note 8.

b. Result

| For the years ended as of December 31,
Result | 2016 | 2015 | 2014
| ThCh$ | ThCh$ | ThCh$
Aguas CCU-Nestlé Chile S.A. | 8,377,672 | 7,052,867 | 5,408,750
Viña San Pedro Tarapacá S.A. | 9,887,477 | 9,182,843 | 6,003,439
Compañía Cervecera Kunstmann S.A. | 1,636,906 | 1,267,335 | 966,212
Manantial S.A. | - | 861,072 | 684,427
Compañía Pisquera de Chile S.A. | 790,152 | 592,506 | 889,482
Saenz Briones & Cía. S.A. | 11,184 | 128,407 | (58,433)
Distribuidora del Paraguay S.A. | 255,683 | 1,144,911 | 429,527
Bebidas del Paraguay S.A. | 576,986 | (486,790) | 253,516
Los Huemules S.R.L. | - | (45,370) | (48,171)
Sidra La Victoria S.A. | - | - | 175
Other | 88,339 | 19,674 | 24,547
Total | 21,624,399 | 19,717,455 | 14,553,471

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c. Summarized financial information of non controlling interest:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Assets and Liabilities |  |
Current assets | 601,165,755 | 566,432,064
Non-current assets | 716,889,536 | 727,700,381
Current liabilities | 368,293,544 | 336,696,932
Non-current liabilities | 146,234,462 | 218,031,963
Dividends paid | 9,803,978 | 5,956,500

The main significant Non-controlling interest is represented by Viña San Pedro Tarapacá S.A. with the following balances:

| As of December 31, 2016 | As of December 31, 2015
| ThCh$ | ThCh$
Assets and Liabilities |  |
Current assets | 145,866,023 | 142,945,036
Non-current assets | 171,099,295 | 165,343,429
Current liabilities | 70,351,438 | 70,099,022
Non-current liabilities | 33,795,671 | 32,681,398
Net sales | 201,402,052 | 189,515,048
Net income of year | 28,021,996 | 26,024,999

Dividends paid by Viña San Pedro amounted to ThCh$ 17,682,375, ThCh$ 13,474,959, and ThCh$ 5,436,350, for the years ended December 31, 2016; 2015, and 2014, respectively.

# Note 32 Common Shareholders’ Equity

Subscribed and paid-up Capital

As of December 31, 2016 and December 31, 2015, the Company’s capital shows a balance of ThCh$ 562,693,346, divided into 369,502,872 shares of common stock without face value, entirely subscribed and paid-up. The Company has issued only one series of common shares. Such common shares are registered for trading at the Santiago Stock Exchange, the Chilean Electronic Stock Exchange and the Valparaíso Stock Exchange, and at the New York Stock Exchange /NYSE), evidenced by ADS (American Deposcitary Shares), with an equivalence of two shares per ADS (Se e Note 1).

The Company has not issued any others shares or convertible instruments during the period, thus changing the number of outstanding shares as of December 31, 2016 and 2015.

Capital Management

The main purpose, when managing shareholder’s capital, is to maintain an adequate credit risk profile and a healthy capital ratio, allowing the access of the Company to the capitals market for the development of its medium and long term purposes and, at the same time, to maximize shareholder’s return.

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Consolidated Statement of Comprehensive Income

As of December 31, 2016, 2015 and 2014, the detail of the comprehensive income and expense of the term is as follows:

Other Income and expense charged or credited against net equity | Gross Balance | Tax | Net Balance
ThCh$ | ThCh$ | ThCh$
Cash flow hedge (1) | 84,962 | (20,648) | 64,314
Conversion differences of subsidiaries abroad (1) | (27,280,176) | - | (27,280,176)
Actuarial gains and losses on defined benefit plans reserves | (2,355,384) | 659,198 | (1,696,186)
Total comprehensive income as of december 31, 2016 | (29,550,598) | 638,550 | (28,912,048)
Other Income and expense charged or credited against net equity | Gross Balance | Tax | Net Balance
ThCh$ | ThCh$ | ThCh$
Cash flow hedge (1) | 80,693 | (17,563) | 63,130
Conversion differences of subsidiaries abroad (1) | (29,678,944) | - | (29,678,944)
Actuarial gains and losses on defined benefit plans reserves | (939,433) | 314,541 | (624,892)
Total comprehensive income as of december 31, 2015 | (30,537,684) | 296,978 | (30,240,706)
Other Income and expense charged or credited against net equity | Gross Balance | Tax | Net Balance
ThCh$ | ThCh$ | ThCh$
Cash flow hedge (1) | (155,258) | 39,470 | (115,788)
Conversion differences of subsidiaries abroad (1) | (4,629,683) | - | (4,629,683)
Actuarial gains and losses on defined benefit plans reserves | (1,884,054) | 501,689 | (1,382,365)
Total comprehensive income As of December 31, 2014 | (6,668,995) | 541,159 | (6,127,836)

(1) These concepts will be reclassified to the Statement of Income when its settled.

The movement of comprehensive income and expense is as follows:

a) As of December 31, 2016:

Changes | Currency translation difference | Hedge reserves | Actuarial gains and losses on defined benefit plans reserves | Total other reserves
ThCh$ | ThCh$ | ThCh$ | ThCh$
Increase (Decrease) | (27,280,176) | (399,558) | (2,355,384) | (30,035,118)
Deferred taxes | - | 89,982 | 659,198 | 749,180
Reclassification to the result by function | - | 484,521 | - | 484,521
Reclassification of deferred taxes related to other reserves | - | (110,631) | - | (110,631)
Total changes in equity | (27,280,176) | 64,314 | (1,696,186) | (28,912,048)
Equity holders of the parent | (25,123,546) | 41,607 | (1,623,299) | (26,705,238)
Non-controlling interests | (2,156,630) | 22,707 | (72,887) | (2,206,810)
Total changes in equity | (27,280,176) | 64,314 | (1,696,186) | (28,912,048)

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Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

b) As of December 31, 2015:

Changes | Currency translation difference | Hedge reserves | Actuarial gains and losses on defined benefit plans reserves | Total other reserves
ThCh$ | ThCh$ | ThCh$ | ThCh$
Increase (Decrease) | (29,678,944) | 593,993 | (939,433) | (30,024,384)
Deferred taxes | - | (145,800) | 314,541 | 168,741
Reclassification to the result by function | - | (513,298) | - | (513,298)
Reclassification of deferred taxes related to other reserves | - | 128,235 | - | 128,235
Total changes in equity | (29,678,944) | 63,130 | (624,892) | (30,240,706)
Equity holders of the parent | (27,652,528) | 40,844 | (589,731) | (28,201,415)
Non-controlling interests | (2,026,416) | 22,286 | (35,161) | (2,039,291)
Total changes in equity | (29,678,944) | 63,130 | (624,892) | (30,240,706)

Income per share

The basic income per share is calculated as the ratio between the net income (loss) of the term corresponding to shares holders and the weighted average number of valid outstanding shares during such term.

The diluted earnings per share is calculated as the ratio between the net income (loss) for the period attributable to shares holders and the weighted average additional common shares that would have been outstanding if it had become all ordinary potential dilutive shares.

As of December 31, 2016, 2015 y 2014, the information used for the calculation of the income as per each basic and diluted share is as follows:

Income per share | For the years ended as of December 31,
2016 | 2015 | 2014
Equity holders of the controlling company (ThCh$) | 118,457,488 | 120,808,135 | 106,238,450
Weighted average number of shares | 369,502,872 | 369,502,872 | 369,502,872
Basic income per share (in Chilean pesos) | 320.59 | 326.95 | 287.52
Equity holders of the controlling company (ThCh$) | 118,457,488 | 120,808,135 | 106,238,450
Weighted average number of shares | 369,502,872 | 369,502,872 | 369,502,872
Diluted income per share (in Chilean pesos) | 320.59 | 326.95 | 287.52

As of December 31, 2016, 2015 y 2014, the Company has not issued any convertible or other kind of instruments creating diluting effects.

Distributable net Income

In accordance with Circular No 1945 from the SVS on November 4, 2009, the Board of Directors agreed that the net distributable profit for the year 2009 will be that reflected in the financial statements attributable to equity holders of the parents, without adjustment it. The above agreement remains in effect for the year ended December 31, 2016.

F-111

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Dividends

The Company’s dividend policy consists of annually distributing at least 50% of the net distributable profit of the year.

As of December 31, 2016, 2015 and 2014, the Company has distributed the following dividends:

Dividend Nº | Payment Date | Type of Dividend | Dividends per Share | Related to FY
247 | 17-04-2014 | Final | 103.48857 | 2013
248 | 09-01-2015 | Interim | 63.0000 | 2014
249 | 23-04-2015 | Final | 98.78138 | 2014
250 | 08-01-2016 | Interim | 66.0000 | 2015
251 | 22-04-2016 | Final | 97.47388 | 2015
252 | 05-01-2017 | Interim | 66.0000 | 2016

On April 9, 2014, at the General Shareholders Meeting it was agreed to pay the final Dividend No. 247, amounting to ThCh$ 38,239,323 corresponding to $ 103.48857 per share. This dividend was paid on April 17, 2014.

On April 15, 2015, at the General Shareholders Meeting it was agreed to pay the final Dividend No. 249, amounting to ThCh$ 36,500,004 corresponding to $ 98.78138 per share. This dividend was paid on April 23, 2015.

On April 13, 2016, at the General Shareholders Meeting it was agreed to pay the final Dividend No. 250, amounting to ThCh$ 36,016,878 corresponding to $ 97.47388 per share. This dividend was paid on April 22, 2016.

Other Reserves

The reserves that are a part of the Company’s equity are as follows:

Currency Translation Reserves: This reserve originated mainly from the translation of foreign subsidiaries’ financial statements which functional currency is different from the presentation currency of the Consolidated Financial Statements. As of December 31, 2016, it amounts to a negative reserve of ThCh$ 120,558,932 (ThCh$ 95,435,386 in 2015 and ThCh$ 67,782,858 in 2014).

Hedge reserve: This reserve originated from the hedge accounting application of financial liabilities for. The reserve is reversed at the end of the hedge agreement, or when the transaction ceases qualifying hedge accounting, whichever is first. The reserve effects are transferred to income. As of December 31, 2016, it amounts to a negative reserve of ThCh$ 39,081 (ThCh$ 2,526 in 2015 and ThCh$ 43,370 in 2014), net of deferred taxes.

Actuarial gains and losses on defined benefit plans reserves: This reserve originates from January 1, 2013, due application of the amendment to IAS 19. The amount recorded is a negative reserve of ThCh$ 3,925,717 (ThCh$ 2,302,418 in 2015 and ThCh$ 1,712,687 in 2014), net of deferred taxes.

Other reserves: As of December 31, 2016, 2015 y 2014 the amount is a negative reserve of ThCh$ 18,527,810, ThCh$ 5,486,086 and ThCh$ 5,511,629, respectively. Such reserves relate mainly to the following concepts:

- Adjustment due to re-assessment of fixed assets carried out in 1979 (increased ofr ThCh$ 4,087,396).

- Price level restatement of paid-up capital registered as of December 31, 2008, according to SVS Circular Letter Nª456 (decreased for ThCh$ 17,615,333).

- Difference in purchase of shares of the subsidiary Viña San Pedro Tarapacá S.A. made during year 2012 and 2013 (Note 1) (decreased for ThCh$ 9,779,475).

- Difference in purchase of shares of the subsidiary Manantial S.A. made during year 2016 (Note 1) (decreased for ThCh$ 7,801,153).

- Difference in purchase of shares of the Alimentos Nutrabien S.A. made during year 2016 (Note 1) (decreased for ThCh$ 5,426,209).

F-112

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 33 Effects of changes in currency exchange rate

Current assets are denominated in the following currencies:

CURRENT ASSETS | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
Current assets |  |
Cash and cash equivalents | 133,789,950 | 192,554,239
CLP | 117,668,934 | 171,683,257
USD | 8,237,893 | 5,385,644
Euros | 786,887 | 955,840
$ARG | 2,187,381 | 5,701,754
UYU | 1,136,782 | 948,816
PYG | 3,269,045 | 7,519,619
Other currencies | 503,028 | 359,309
Other financial assets | 8,406,491 | 13,644,105
CLP | 548,700 | 1,052,312
USD | 7,604,996 | 12,495,117
Euros | 160,875 | 57,833
PYG | 80,846 | 7,261
Other currencies | 11,074 | 31,582
Other non-financial assets | 15,859,137 | 17,654,373
CLP | 11,994,895 | 12,083,128
UF | 139,776 | 29,882
USD | 683,933 | 972,718
Euros | 85,753 | 723,216
$ARG | 2,641,862 | 3,780,430
UYU | 86,842 | 7,789
PYG | 226,076 | 57,210
Accounts receivable - trade and other receivables | 280,766,784 | 252,225,937
CLP | 179,861,356 | 158,757,937
UF | 676,843 | 7,102
USD | 24,449,473 | 25,498,590
Euros | 7,025,446 | 7,463,166
$ARG | 56,347,636 | 48,535,814
UYU | 5,304,719 | 4,074,908
PYG | 5,844,650 | 6,111,636
Other currencies | 1,256,661 | 1,776,784
Accounts receivable from related companies | 3,523,825 | 4,788,930
CLP | 3,373,508 | 4,604,853
UF | 107,162 | 104,118
USD | 43,155 | 79,959
Inventories | 199,290,678 | 174,227,415
CLP | 168,749,946 | 147,189,195
USD | 287,776 | 2,474,304
Euros | 25,634 | 237,848
$ARG | 25,104,485 | 18,850,888
UYU | 1,590,709 | 1,645,888
PYG | 3,532,128 | 3,829,292
Biological assets | 7,948,379 | 7,633,340
CLP | 7,370,852 | 7,130,962
$ARG | 577,527 | 502,378
Tax receivables | 29,423,479 | 15,264,220
CLP | 26,525,628 | 11,080,218
$ARG | 2,897,851 | 4,184,002
Non-current assets held for sale | 2,377,887 | 6,319,316
CLP | 2,046,179 | 5,890,543
$ARG | 331,708 | 428,773
Total current assets | 681,386,610 | 684,311,875
CLP | 518,139,998 | 519,472,405
UF | 923,781 | 141,102
USD | 41,307,226 | 46,906,332
Euros | 8,084,595 | 9,437,903
$ARG | 90,088,450 | 81,984,039
UYU | 8,119,052 | 6,677,401
PYG | 12,952,745 | 17,525,018
Other currencies | 1,770,763 | 2,167,675
Total current assets by currencies | 681,386,610 | 684,311,875

F-113

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Non-Current assets are denominated in the following currencies:

NON-CURRENT ASSETS | As of December 31, 2016 | As of December 31, 2015
ThCh$ | ThCh$
Non-current assets |  |
Other financial assets | 203,784 | 80,217
Euros | 203,784 | 80,217
Accounts receivable non-current | 3,563,797 | -
CLP | 35,391 | -
UF | 2,936,552 | -
$ARG | 426,311 | -
PYG | 165,543 | -
Other non-financial assets | 5,369,211 | 5,220,954
CLP | 3,177,139 | 3,034,450
USD | 669,470 | 80,137
$ARG | 1,519,236 | 1,839,876
PYG | 3,366 | 266,491
Accounts receivable from related companies | 356,665 | 445,938
UF | 356,665 | 445,938
Investments accounted for using the equity method | 64,404,946 | 49,995,263
CLP | 64,005,129 | 49,884,870
$ARG | 399,817 | 110,393
Intangible assets different than goodwill | 77,678,850 | 71,868,007
CLP | 64,981,854 | 57,749,615
$ARG | 5,508,504 | 7,039,283
UYU | 3,247,094 | 3,296,510
PYG | 3,941,398 | 3,782,599
Goodwill | 96,663,023 | 99,490,372
CLP | 76,382,543 | 76,382,543
USD | 13,402,038 | 14,216,606
$ARG | 6,878,442 | 8,891,223
Property, plant and equipment (net) | 903,831,702 | 872,667,210
CLP | 787,734,139 | 763,339,926
USD | 26,072 | -
Euros | 971,382 | -
$ARG | 82,920,719 | 76,412,324
UYU | 15,436,334 | 13,747,872
PYG | 16,743,056 | 19,167,088
Investment property | 6,253,827 | 6,838,002
CLP | 5,015,603 | 4,401,400
$ARG | 1,238,224 | 2,436,602
Deferred tax assets | 31,864,635 | 34,529,593
CLP | 29,547,881 | 29,392,503
$ARG | 2,108,426 | 5,032,803
UYU | 156,714 | 10,801
PYG | 51,614 | 93,486
Total non-current assets | 1,190,190,440 | 1,141,135,556
CLP | 1,030,879,679 | 984,185,307
UF | 3,293,217 | 445,938
USD | 14,097,580 | 14,296,743
Euros | 1,175,166 | 80,217
$ARG | 100,999,679 | 101,762,504
UYU | 18,840,142 | 17,055,183
PYG | 20,904,977 | 23,309,664
Total non-current assets by currencies | 1,190,190,440 | 1,141,135,556

F-114

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Current liabilities are denominated in the following currencies:

CURRENT LIABILITIES | As of December 31, 2016 | As of December 31, 2015
Until 90 days | More the 91 days until 1 year | Until 90 days | More the 91 days until 1 year
ThCh$ | ThCh$ | ThCh$ | ThCh$
Current liabilities |  |  |  |
Other financial liabilities | 19,600,116 | 47,079,817 | 7,223,935 | 36,750,056
CLP | 946,301 | 39,944,625 | 1,239,182 | 17,035,281
UF | 892,328 | 2,843,982 | 764,199 | 2,888,550
USD | 11,280,437 | 388,874 | 303,416 | 10,957,905
Euros | 523,079 | - | 52,368 | -
$ARG | 5,542,674 | 3,263,782 | 4,862,819 | 5,523,470
UYI | 406,353 | 638,554 | - | 344,850
Other currencies | 8,944 | - | 1,951 | -
Account payable - trade and other payables | 258,298,853 | 1,378,999 | 226,844,826 | 891,977
CLP | 166,920,713 | 303,060 | 148,162,838 | 303,060
UF | 30,798 | - | 9,933 | -
USD | 18,281,460 | 937,822 | 17,676,381 | 566,572
Euros | 8,160,258 | - | 6,402,517 | -
$ARG | 59,603,954 | - | 47,686,146 | -
UYU | 3,309,074 | - | 2,607,826 | -
PYG | 1,638,181 | 138,117 | 3,874,709 | 22,345
Other currencies | 354,415 | - | 424,476 | -
Accounts payable to related companies | 9,530,071 | - | 11,624,218 | -
CLP | 5,329,217 | - | 4,267,123 | -
USD | 2,196 | - | 151,578 | -
Euros | 4,197,020 | - | 7,205,517 | -
PYG | 1,638 | - | - | -
Other short-term provisons | 339,072 | 70,092 | 382,152 | 121,288
CLP | - | 70,092 | - | 121,288
$ARG | 339,072 | - | 382,152 | -
Tax liabilities | 7,544,398 | 4,262,036 | 3,664,162 | 8,533,862
CLP | 5,316,283 | 4,262,036 | 3,487,812 | 5,802,277
USD | 22,183 | - | - | 26,747
$ARG | 1,966,866 | - | - | 2,704,838
UYU | 239,066 | - | 176,350 | -
Employee benefits provisions | 22,255,693 | 582,535 | 21,388,736 | 323,323
CLP | 16,579,716 | 582,535 | 16,558,870 | 323,323
$ARG | 5,367,378 | - | 4,437,159 | -
UYU | 308,599 | - | 392,707 | -
Other non-financial liabilities | 24,421,940 | 46,948,032 | 28,440,259 | 42,501,885
CLP | 24,388,426 | 46,948,032 | 28,350,457 | 42,501,885
$ARG | 33,514 | - | 89,802 | -
Total current liabilities | 341,990,143 | 100,321,511 | 299,568,288 | 89,122,391
CLP | 219,480,656 | 92,110,380 | 202,066,282 | 66,087,114
UF | 923,126 | 2,843,982 | 774,132 | 2,888,550
USD | 29,586,276 | 1,326,696 | 18,131,375 | 11,551,224
Euros | 12,880,357 | - | 13,660,402 | -
$ARG | 72,853,458 | 3,263,782 | 57,458,078 | 8,228,308
UYU | 3,856,739 | - | 3,176,883 | -
PYG | 1,639,819 | 138,117 | 3,874,709 | 22,345
UYI | 406,353 | 638,554 | - | 344,850
Other currencies | 363,359 | - | 426,427 | -
Total current liabilities by currency | 341,990,143 | 100,321,511 | 299,568,288 | 89,122,391

F-115

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Non-Current liabilities are denominated in the following currencies:

NON-CURRENT LIABILITIES | As of December 31, 2016 | As of December 31, 2015
More than 1 year until 3 years | More than 3 year until 5 years | More than 5 years | More than 1 year until 3 years | More than 3 year until 5 years | More than 5 years
ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$
Non-current liabilities |  |  |  |  |  |
Other financial liabilities | 36,676,882 | 15,610,067 | 65,657,084 | 40,890,654 | 20,356,339 | 75,679,552
CLP | 5,320,385 | 626,411 | - | 18,284,794 | 1,784,088 | -
UF | 17,811,112 | 14,983,656 | 65,657,084 | 5,523,414 | 17,335,859 | 75,679,552
USD | 5,269,733 | - | - | 5,590,024 | - | -
$ARG | 7,579,047 | - | - | 9,790,622 | 1,236,392 | -
UYI | 696,605 | - | - | 1,701,800 | - | -
Other accounys payable | 1,082,898 | - | - | 1,098,985 | 546,113 | -
CLP | 808,160 | - | - | 808,161 | 404,081 | -
UF | 6,950 | - | - | 6,760 | - | -
USD | 267,788 | - | - | 284,064 | 142,032 | -
Other long term provisions | 507,259 | 401,054 | 415,207 | 712,806 | 410,073 | 353,639
CLP | - | 49,996 | - | - | 49,996 | 15,000
$ARG | 258,278 | 351,058 | 415,207 | 396,987 | 360,077 | 338,639
UYU | 248,981 | - | - | 314,991 | - | -
PYG | - | - | - | 828 | - | -
Deferred tax liabilities | 26,487,686 | 7,963,522 | 52,338,743 | 21,787,421 | 8,622,777 | 59,827,645
CLP | 26,183,335 | 7,767,522 | 48,824,727 | 21,175,080 | 8,219,255 | 53,911,744
$ARG | 287,582 | 191,721 | 2,048,919 | 601,313 | 400,875 | 4,288,716
UYU | - | - | 1,015,197 | - | - | 1,154,787
PYG | 16,769 | 4,279 | 449,900 | 11,028 | 2,647 | 472,398
Employee benefits provisons | 335,925 | - | 21,496,490 | 643,905 | - | 18,304,698
CLP | - | - | 18,481,842 | - | - | 15,369,150
$ARG | - | - | 3,014,648 | - | - | 2,935,548
PYG | 335,925 | - | - | 643,905 | - | -
Total non-current liabilities | 65,090,650 | 23,974,643 | 139,907,524 | 65,133,771 | 29,935,302 | 154,165,534
CLP | 32,311,880 | 8,443,929 | 67,306,569 | 40,268,035 | 10,457,420 | 69,295,894
UF | 17,818,062 | 14,983,656 | 65,657,084 | 5,530,174 | 17,335,859 | 75,679,552
USD | 5,537,521 | - | - | 5,874,088 | 142,032 | -
$ARG | 8,124,907 | 542,779 | 5,478,774 | 10,788,922 | 1,997,344 | 7,562,903
UYU | 248,981 | - | 1,015,197 | 314,991 | - | 1,154,787
PYG | 352,694 | 4,279 | 449,900 | 655,761 | 2,647 | 472,398
UYI | 696,605 | - | - | 1,701,800 | - | -
Total non-current liabilities by currency | 65,090,650 | 23,974,643 | 139,907,524 | 65,133,771 | 29,935,302 | 154,165,534

F-116

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 34 Contingencies and Commitments

Operating lease agreements

The total amount of the Company’s obligations to third parties relating to lease agreements that may not be terminated is as follows:

Lease Agreements not to be terminated | As of December 31, 2016
ThCh$
Within 1 year | 175,604,322
Between 1 and 5 years | 272,442,932
Over 5 years | 34,053,398
Total | 482,100,652

Purchase and supply agreements

The total amount of the Company’s obligations to third parties relating to purchase and supply agreements as of December 31, 2016 is as follows:

Purchase and supply agreements | Purchase and supply agreements | Purchase and contract related to wine and grape
ThCh$ | ThCh$
Within 1 year | 128,703,020 | 8,713,649
Between 1 and 5 years | 292,815,491 | 9,521,391
Over 5 years | 44,412,317 | 157,459
Total | 465,930,828 | 18,392,499

Capital investment commitments

As of December 31, 2016, the Company had capital investment commitments related to Property, Plant and Equipment and Intangibles (software) for approximately ThCh$ 54,115,404.

Litigation

The following are the most significant proceedings faced by the Company and its subsidiaries, including all those present a possible risk of occurrence and causes whose committed amounts, individually, are more than ThCh$ 25,000. Those losses contingencies for which an estimate cannot be made have been also considered.

F-117

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Proceedings and claim

Subsidiary | Court | Number | Description | Status | Estimated accrued loss contingency
Viña Tarapacá Ex Zavala, Viña Misiones de Rengo | 14th Civil Court of Santiago | 28869-2007 | Breach of contract | Appeal of first instance verdict | ThCh$ 50,000
Compañía Industrial Cervecera S.A. (CICSA) | Court of first instance in Argentina | - | Labor trial for layoff | On evidentiary phase | US$ 31,000
Compañía Industrial Cervecera S.A. (CICSA) | Supreme Court of Tucuman | - | Intempestive breach of distribution contract | Supreme Court review | US$ 35,000
Compañía Industrial Cervecera S.A. (CICSA) | Court of first instance in Argentina | - | Labor trial for layoff | On evidentiary phase | US$ 32,000
Compañía Industrial Cervecera S.A. (CICSA) | Appeals court | - | Intempestive breach of distribution contract | On execution phase | US$ 37,000
Compañía Industrial Cervecera S.A. (CICSA) | Court of first instance in Argentina | - | Labor trial for layoff | On execution phase | US$ 36,000
Compañía Industrial Cervecera S.A. (CICSA) | Court of first instance in Argentina | - | Labor trial for layoff | On evidentiary phase | US$ 50,000
Compañía Industrial Cervecera S.A. (CICSA) | - | - | City Council´s Administrative Claim related to advertising and publicity fees | The process is in pre-trial administrative phase | US$ 506,000
Saenz Briones y Cía. S.A. | Court of first instance in Argentina | - | Labor trial for layoff | On evidentiary phase | US$ 67,000

F-118

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

Subsidiary | Court | Number | Description | Status | Estimated accrued loss contingency
Saenz Briones y Cía. S.A. | Court of first instance in Argentina | - | Labor trial for layoff | On evidentiary phase | US$ 168,000
Saenz Briones y Cía. S.A. | Court of first instance in Argentina | - | Labor trial for layoff | On evidentiary phase | US$ 63,000
Saenz Briones y Cía. S.A. | Court of first instance in Argentina | - | Labor trial for layoff | On evidentiary phase | US$ 167,000
Saenz Briones y Cía. S.A. | Court of first instance in Argentina | - | Labor trial for layoff | On evidentiary phase | US$ 61,000

The Company and its subsidiaries have established provisions to allow for such contingencies for ThCh$ 1,248,243 and ThCh$ 1,343,374, as of December 31, 2016 and 2015, respectively (See Note 28).

Tax processes

At the date of issue of these consolidated financial statements, there are no tax litigation that involve significant passive or taxes in claim different to mentioned in Note 25.

Guarantees

As of December 31, 2016, the subsidiary Viña San Pedro Tarapacá S.A. (VSPT) has not granted direct guarantees as part of its common financing operations. Nevertheless, its VSPT has entered into indirect guarantees as joint guarantors of financing operations by Finca La Celia S.A. subsidiary, in the Republic of Argentina.

A summary of the main terms of the guarantees granted appears below:

The subsidiary Finca La Celia S.A. maintains financial debt with local banks in Argentina, guaranteed by VSPT through stand-by letters issued by Banco Estado de Chile, according to the following detail:

Institution | Amount | Due date
Banco Santander Río | USD 1,100,000 | August 20, 2017
Banco Patagonia | USD 1,600,000 | March 31, 2017
Banco Patagonia | USD 1,600,000 | July 7, 2017
Banco San Juan | USD 1,200,000 | April 28, 2017
Banco BBVA Francés | USD 1,500,000 | February 20, 2017

The mentioned stand-by letters were issued by VSPT according to the maturity of the financial debts negotiated with the Argentine banks, and they are within the financing policy framework approved by VSPT Board of Directors.

F-119

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The loan obtained by the subsidiary CICSA in Argentina, as described in N ote 27, is guaranteed by CCU S.A. through a stand- by unrestricted, 1 year term, renewable for equal period during the term of the loan.

Institution | Amount | Due date
Banco de la Nación Argentina S.A. | USD 9,000,000 | December 31, 2017

On July 11, 2013, the subsidiary in Argentina Saenz Briones & Cía. S.A. (SB) has signed a loan agreement with the Citibank Bank of Argentina, which restricted its ability to distribute profits in each year. The loan was by 10,000,000 argentine pesos and whose return was agreed in 9 (nine) quotes with different maturities. Until SB not pay this loan, plus interest or commissions, fees and expenses, may not make any payment to its shareholders (including, without limitation, distribution of profits or dividends, advances, withdrawals from account or similar, as well as any payment made in connection with rebuy it, rescue or redemption of all or part of its shares) for an amount that exceeds the 50% of the profits that the SB is legally empowered to distribute as dividends with regard to each of its years. It should be noted, for the purposes of the above restriction, that the last date of maturity of the loan is July 11, 2016.

# Note 35 Environment

Distribution of CCU´s main environmental costs in the Industrial Units, accumulated to September 2016:

- Industrial Waste Water Treatment (IWWT): 52,8 %

These expenses are mainly related to the maintenance and control of the respective Industrial Waste Water Treatment Plants (IWWT).

- Solid Industrial Residues (SIR): 33,4 %

These expenses are related to the handling and disposal of Solid Industrial Residues (SIR), including hazardous Waste (ResPel) and valorisation of recyclable residues.

- Gas Emission Expenses: 1,2 %

These expenses are related to the calibration and verification of monitoring and operational instrumentation of stationary sources (mainly industrial boilers and electric generators) and their respective emissions, in order to provide compliance to rules and central and local government regulations.

- Other Environmental Expenses: 12,6 %

These expenses are related to the verification and compliance of Food Safety, Environmental Management and Operational Health & Safety Management Standards (ISO 22.000, ISO 14.001 and ISO 18.001 OHSAS respectively) in CCU´s industrial sites and distribution centers, which are in different stages of implementation and certification. The implementation and certification of those three standards is a corporate goal of CCU S.A.

F-120

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The main expensesof each year, detailed by project, are the following:

Company that made the disbursement | Project | Expenses | For the years ended as of December 31,
2016 | 2015
ThCh$ | ThCh$
CCU Chile Ltda. | IWWT | Maintenance and control of the Industrial Waste Water Treatment Plants (IWWT). | 1,319,489 | 1,160,516
| SIR | Solid waste (SIR) and hazardous waste (ResPel) management. | 666,781 | 607,091
| Gases | Management of atmospheric emissions | 21,655 | 26,031
| Others | Management of internal and external regulatory compliance. | 233,364 | 173,115
CCU Argentina S.A. | IWWT | Maintenance and control of the Industrial Waste Water Treatment Plants (IWWT). | 820,999 | 1,089,788
| SIR | Solid waste (SIR) and hazardous waste (ResPel) management. | 560,710 | 602,247
| Gases | Management of atmospheric emissions | 21,847 | 2,857
| Others | Management of internal and external regulatory compliance. | 141,379 | 167,668
Cía. Cervecera Kunstmann S.A. | IWWT | Maintenance and control of the Industrial Waste Water Treatment Plants (IWWT). | 86,515 | 87,069
| SIR | Solid waste (SIR) and hazardous waste (ResPel) management. | 40,150 | 10,633
| Others | Management of internal and external regulatory compliance. | 45,876 | 45,781
Cía. Pisquera de Chile S.A. | IWWT | Maintenance and control of the Industrial Waste Water Treatment Plants (IWWT). | 237,994 | 224,045
| SIR | Solid waste (SIR) and hazardous waste (ResPel) management. | 43,059 | 78,746
| Others | Management of internal and external regulatory compliance. | 12,582 | 15,628
Transportes CCU Limitada | IWWT | Maintenance and control of the Industrial Waste Water Treatment Plants (IWWT). | 9,792 | 18,687
| SIR | Solid waste (SIR) and hazardous waste (ResPel) management. | 288,856 | 196,114
| Gases | Management of atmospheric emissions | 13,356 | 17,297
| Others | Management of internal and external regulatory compliance. | 141,138 | 130,044
VSPT S.A. | IWWT | Maintenance and control of the Industrial Waste Water Treatment Plants (IWWT). | 454,828 | 381,893
| SIR | Solid waste (SIR) and hazardous waste (ResPel) management. | 165,697 | 172,089
| Others | Management of internal and external regulatory compliance. | 10,916 | 5,227
Embotelladora Chilenas Unidas S.A. | IWWT | Maintenance and control of the Industrial Waste Water Treatment Plants (IWWT). | 593,414 | 665,990
| SIR | Solid waste (SIR) and hazardous waste (ResPel) management. | 421,771 | 53,539
| Gases | Management of atmospheric emissions | 156,295 | 96,019
| Others | Management of internal and external regulatory compliance. | 14,305 | 10,233
Aguas CCU-Nestlé Chile S.A. | IWWT | Maintenance and control of the Industrial Waste Water Treatment Plants (IWWT). | 35,550 | 29,057
| SIR | Solid waste (SIR) and hazardous waste (ResPel) management. | 3,910 | 3,661
| Others | Management of internal and external regulatory compliance. | 69,330 | 50,904
Fábrica de Envases Plásticos S.A. | SIR | Solid waste (SIR) and hazardous waste (ResPel) management. | 21,410 | 19,326
| Gases | Management of atmospheric emissions | 129,487 | 137,359

F-121

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

The main disbursements (investment) of each year, detailed by by project, are the following:

Company that made the disbursement | Project | Concept | Status [Finished, In process] | As of December 31, 2016 | As of December 31, 2015
Disbursements made | Amount committed future periods | Estimated Completion Date Disbursements | Disbursements made
ThCh$ | ThCh$ | ThCh$
CCU Chile Ltda. | IWWT | IWWT Temuco Stage II; IWWT expansion (Screw) Temuco | Processing | 2,854,428 | 156,383 | Dec - 17 | 181,077
| SIR | Changing and increasing containers for glass and rubbish | Finished | 37,602 | - | Finished | 194,875
| Gases | Change Fuel FO6 to GNL Temuco, Upgrade Odor Control, Thermal Plant Improvements Quilicura, Videoconferencing rooms. | Processing | 265,248 | 103,093 | Dec - 17 | 35,728
| Others | DS 10 and RE 43 compliance; Emergency Brigade and Anti Fire Protection System | Processing | 108,188 | 352,424 | Dec - 17 | 124,162
CCU Argentina S.A. | IWWT | IWWT Stage 2 and 3, Salta | Processing | 217,401 | 134,386 | Dec - 17 | 60,003
| Gases | Boiler 1 Economizer, Luján | Finished | 227,079 | 29,780 | Finished | -
| Others | Fire Network in Distribution Center SV; Compromises ISO 22 K/14K/18 K OSHAS Luján | Processing | 32,360 | 25,076 | Dec - 17 | 56,131
Cía. Cervecera | IWWT | New IWWT PTR – IC Technology | Processing | 2,050,705 | 548,710 | Dec - 17 | 2,958,767
Kunstmann S.A. | Others | DIA; Increase installed power; Equipment protection structures | Processing | 33,835 | 278,000 | Dec - 17 | -
Cía. Pisquera de Chile S.A. | IWWT | IWWT, Change of Hidroeyectors, Water plant and dam, IWWT improvement in Salamanca and Sotaquí, New Sewer Plant, Water process meters. | Finished | 133,879 | 6,864 | Finished | 9,712
| SIR | Improved sludge system; Containers for glass | Finished | 20,224 | 1,610 | Finished | -
| Others | Requirement for ISO Standards in Salamanca, Monte Patria, Sotaquí and Pisco Elqui; DS 10 compliance in Salamanca and Montepatria | Processing | 268,003 | 379,547 | Dec - 17 | -
Transportes CCU Limitada | SIR | Ceiling of waste area in Distribution Center Llay Llay | Processing | - | 57,224 | Dec - 17 | -
| Gases | LED lightning in Distribution Center Talca | Processing | 81,355 | 43,939 | Dec - 17 | -
| Others | Access to DC Copiapó and Acoustic closure in DC Cervecería Stgo. | Processing | 138,743 | 103,057 | Dec - 17 | -
VSPT S.A. | IWWT | Sewage plant; Degassing Pond Improvement | Finished | 76,285 | - | Finished | 50,356
| SIR | Solid Packing Separator | Finished | 3,128 | - | Finished | -
| Gases | Electric Power Generator to IWWT, Power Meters | Finished | 19,296 | - | Finished | -
| Others | Fire network Molina, DS 10 compliance, Standardization 5 dining rooms, Autonomous Breathing Equipment | Finished | 220,005 | - | Finished | 85,825
Embotelladora Chilenas Unidas S.A. | Gases | Condensate recovery, Meters and Monitoring of Consumption, Mantle Insulation of Boilers, Heat recovery compressor discharge, Upgrade exhaust gas analyzer, Upgrade System Control and Installation System Lighting. | Processing | 54,282 | 29,402 | Dec - 17 | 33,684
| Others | Safety Acid Injection; Standardization Kitchen ECCUSA; Autonomous Breathing Equipment to Stgo. and Antofagasta | Processing | 112,904 | 27,843 | Dec - 17 | 5,992
Aguas CCU-Nestlé Chile S.A. | IWWT | IWWT Coinco | Processing | 559,569 | 410,347 | Dec - 17 | 27,756
| Gases | Lighting lines 1, 2 y 3, Steam networks, Solar Lighting | Finished | 21,425 | - | Finished | -
| Others | Warehouse Flammable Coinco, RE 43 and DS 594 compliance. | Processing | 28,694 | 222,221 | Dec - 17 | 12,600
Fábrica de Envases Plásticos S.A. | Gases | Control of electrical variables, change of lighting. | Processing | 187,373 | 22,404 | Dec - 17 | 47,711
| Others | Risk Mitigation, Reduction weight of PET Bottles, Bathroom Expansion, Various SIG -OCA, Ammonia Sensors | Processing | 158,522 | 47,436 | Dec - 17 | 61,401

F-122

Compañía Cervecerías Unidas S.A. and subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 |

# Note 36 Subsequent Events

a) The Consolidated Financial Statements of CCU S.A. have been approved by the Board Directors on February 27, 2017.

b) There are no others subsequent events between the closing date and the filing date of these Financial Statements (February 27, 2017) that could significantly affect their interpretation.

F-123

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Compañía Cervecerías Unidas S.A.
(United Breweries Company, Inc.)

| /s/ Felipe Dubernet
| Chief Financial Officer

Date: February 27, 2017