INDEX

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION		4
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)		5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)		6
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY		7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS		8
1	COMPANY’S OPERATIONS	9
2	BASIS OF PREPARATION AND PRESENTATION OF INTERIM FINANCIAL INFORMATION	18
3	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	18
4	CASH AND CASH EQUIVALENTS	19
5	MARKETABLE SECURITIES	20
6	TRADE ACCOUNTS RECEIVABLE AND OTHER RECEIVABLES	20
7	INVENTORIES	21
8	BIOLOGICAL ASSETS	23
9	RECOVERABLE TAXES	24
10	DEFERRED INCOME TAXES	26
11	JUDICIAL DEPOSITS	28
12	PROPERTY, PLANT AND EQUIPMENT, NET	29
13	INTANGIBLE ASSETS	31
14	LOANS AND BORROWINGS	33
15	TRADE ACCOUNTS PAYABLE	35
16	SUPPLY CHAIN FINANCE	36
17	LEASES	37
18	SHARE-BASED PAYMENT	39
19	EMPLOYEES BENEFITS PLANS	40
20	PROVISION FOR TAX, CIVIL AND LABOR RISKS	41
21	EQUITY	41
22	EARNINGS (LOSS) PER SHARE	44
23	FINANCIAL INSTRUMENTS AND RISK MANAGEMENT	44
24	SEGMENT INFORMATION	55
25	NET SALES	57
26	OTHER OPERATING INCOME (EXPENSES), NET	57
27	FINANCIAL INCOME (EXPENSES), NET	58
28	STATEMENT OF INCOME BY NATURE	58
29	RELATED PARTIES	58
30	COMMITMENTS	60
31	TRANSACTIONS THAT DO NOT INVOLVE CASH	60

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32	EVENTS AFTER THE REPORTING PERIOD	61
33	APPROVAL OF THE INTERIM FINANCIAL INFORMATION	62

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CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

ASSETS	Note		09.30.21		12.31.20
CURRENT ASSETS
Cash and cash equivalents	4		6,889,844		7,576,625
Marketable securities	5		343,182		314,158
Trade and other receivables	6		3,586,751		4,136,421
Inventories	7		9,258,921		6,802,759
Biological assets	8		2,668,065		2,129,010
Recoverable taxes	9		883,740		899,120
Recoverable income taxes	9		94,936		43,840
Derivative financial instruments	23		83,144		377,756
Restricted cash			24,529		1
Assets held for sale			21,773		186,025
Other current assets			387,341		446,269
Total current assets			24,242,226		22,911,984
NON-CURRENT ASSETS
LONG-TERM RECEIVALBLES
Marketable securities	5		375,906		344,577
Trade and other receivables	6		41,886		49,864
Recoverable taxes	9		4,743,657		4,868,198
Recoverable income taxes	9		59,864		54,859
Deferred income taxes	10		2,505,005		2,109,064
Judicial deposits	11		543,106		553,341
Biological assets	8		1,382,832		1,221,749
Derivative financial instruments	23		2,139		234
Restricted cash			1		24,357
Other non-current assets			77,528		82,123
Total long-term receivables			9,731,924		9,308,366
Investments			6,911		8,874
Property, plant and equipment, net	12		12,822,742		12,215,580
Intangible assets	13		6,245,045		5,220,102
Total non-current assets			28,806,622		26,752,922
TOTAL ASSETS			53,048,848		49,664,906

LIABILITIES	Note		09.30.21		12.31.20
CURRENT LIABILITIES
Loans and borrowings	14		2,861,250		1,059,984
Trade accounts payable	15		11,077,197		8,996,206
Supply chain finance	16		1,889,219		1,452,637
Lease liability	17		485,905		383,162
Payroll, related charges and employee profit sharing			1,003,089		940,816
Taxes payable			372,343		395,630
Derivative financial instruments	23		186,147		384,969
Provision for tax, civil and labor risks	20		1,050,188		865,338
Employee benefits	19		125,312		125,230
Liabilities directly associated with assets held for sale			-		21,718
Other current liabilities			1,183,243		814,638
Total current liabilities			20,233,893		15,440,328
NON-CURRENT LIABILITIES
Loans and borrowings	14		21,317,352		21,344,442
Trade accounts payable	15		11,999		13,781
Lease liability	17		2,069,305		2,153,519
Taxes payable			133,560		141,252
Provision for tax, civil and labor risks	20		508,353		837,382
Deferred income taxes	10		34,482		26,527
Employee benefits	19		696,862		651,325
Derivative financial instruments	23		36,077		727
Other non-current liabilities			330,719		242,089
Total non-current liabilities			25,138,709		25,411,044
EQUITY	21
Capital			12,460,471		12,460,471
Capital reserves			141,834		141,834
Other equity transactions			(80,313)		246
Accumulated losses			(3,062,798)		(2,594,028)
Treasury shares			(105,620)		(123,938)
Other comprehensive loss			(1,753,727)		(1,298,801)
Attributable to controlling shareholders			7,599,847		8,585,784
Non-controlling interests			76,399		227,750
Total equity			7,676,246		8,813,534
TOTAL LIABILITIES AND EQUITY			53,048,848		49,664,906

The accompanying notes are an integral part of the condensed consolidated interim financial information.

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CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

					2021				2020
	Note		Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
CONTINUING OPERATIONS
NET SALES	25		12,389,985		34,618,863		9,942,591		27,995,582
Cost of sales	28		(9,765,303)		(27,573,239)		(7,598,133)		(21,419,255)
GROSS PROFIT			2,624,682		7,045,624		2,344,458		6,576,327
OPERATING INCOME (EXPENSES)
Selling expenses	28		(1,647,761)		(4,624,899)		(1,366,469)		(4,011,692)
General and administrative expenses	28		(221,707)		(573,966)		(217,348)		(550,373)
Impairment loss on trade receivables	6		(3,135)		(11,627)		(3,371)		(15,126)
Other operating income (expenses), net	26		(21,599)		103,581		(13,193)		91,243
INCOME BEFORE FINANCIAL RESULTS AND INCOME TAXES			730,480		1,938,713		744,077		2,090,379
Financial income			133,806		340,283		72,702		267,413
Financial expenses			(1,047,189)		(2,470,878)		(591,666)		(1,327,579)
Foreign exchange and monetary variations			(71,575)		(216,381)		82,545		(173,025)
FINANCIAL INCOME (EXPENSES), NET	27		(984,958)		(2,346,976)		(436,419)		(1,233,191)
INCOME (LOSS) BEFORE TAXES			(254,478)		(408,263)		307,658		857,188
Income taxes	10		(16,505)		(38,818)		(88,949)		(234,654)
INCOME (LOSS) FROM CONTINUING OPERATIONS			(270,983)		(447,081)		218,709		622,534
LOSS FROM DISCONTINUED OPERATIONS			(6,516)		(47,802)		-		-
INCOME (LOSS) FOR THE PERIOD			(277,499)		(494,883)		218,709		622,534
Net Income (loss) from Continuing Operation Attributable to
Controlling shareholders			(275,600)		(454,014)		216,791		609,668
Non-controlling interest			4,617		6,933		1,918		12,866
INCOME (LOSS) FROM CONTINUING OPERATIONS			(270,983)		(447,081)		218,709		622,534
Net Loss From Discontinued Operations Attributable to
Controlling shareholders			(6,516)		(47,802)		-		-
Non-controlling interest			-		-		-		-
LOSS FROM DISCONTINUED OPERATIONS			(6,516)		(47,802)		-		-
INCOME (LOSS) PER SHARE FROM CONTINUED OPERATIONS
Weighted average shares outstanding - basic			807,709,278		808,013,781		807,406,368		809,583,921
Income (loss) per share - basic	22		(0.34)		(0.56)		0.27		0.75
Weighted average shares outstanding - diluted			807,709,278		808,013,781		807,464,700		809,642,253
Income (loss) per share - diluted	22		(0.34)		(0.56)		0.27		0.75
LOSSES PER SHARE FROM DISCONTINUED OPERATIONS
Weighted average shares outstanding - basic			807,709,278		808,013,781		-		-
Losses per share - basic	22		(0.01)		(0.06)		-		-
Weighted average shares outstanding - diluted			807,709,278		808,013,781		-		-
Losses per share - diluted	22		(0.01)		(0.06)		-		-

The accompanying notes are an integral part of the condensed interim financial information.

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

					2021				2020
	Note		Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Income (loss) for the period			(277,499)		(494,883)		218,709		622,534
Other comprehensive income (loss)
Loss on foreign currency translation of foreign operations			(64,635)		(204,216)		(90,273)		(195,970)
Loss on net investment hedge			(106,956)		(61,079)		(43,428)		(385,539)
Cash flow hedges - effective portion of changes in fair value	23		(254,306)		(188,047)		(82,428)		(1,735,875)
Cash flow hedges - reclassified to profit or loss	23		(42,306)		(51,452)		279,724		1,191,688
Gain on debt investments measured at FVTOCI (1)	5		-		-		348		178
Items that are or may be reclassified subsequently to profit or loss			(468,203)		(504,794)		63,943		(1,125,518)
Gain (loss) on equity investments measured at FVTOCI (1)	5		-		26,030		(924)		4,079
Actuarial gains on pension and post-employment plans	19		3,694		11,729		7,170		20,134
Items that will not be reclassified to profit or loss			3,694		37,759		6,246		24,213
Comprehensive income (loss), net of taxes			(742,008)		(961,918)		288,898		(478,771)
Attributable to
Controlling shareholders			(744,478)		(923,696)		285,526		(535,845)
Non-controlling interest			2,470		(38,222)		3,372		57,074
Total comprehensive income (loss), net of taxes			(742,008)		(961,918)		288,898		(478,771)

(1) FVTOCI: Fair Value Through Other Comprehensive Income.

Items above are stated net of income taxes and the related taxes are disclosed in note 10.

The accompanying notes are an integral part of the condensed consolidated interim financial information.

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

			Attributed to controlling shareholders
											Other comprehensive income (loss)
			Capital		Capital reserves		Other equity transactions (4)		Treasury shares		Accumulated foreign currency translation adjustments		Gains (losses) on marketable securities at FVTOCI (2)		Gains (losses) on cash flow hedge		Actuarial gains (losses)		Retained losses		Total equity		Non-controlling interest		Total shareholders' equity (consolidated)
BALANCES AT DECEMBER 31, 2020			12,460,471		141,834		246		(123,938)		(678,969)		7,016		(438,221)		(188,627)		(2,594,028)		8,585,784		227,750		8,813,534
Comprehensive income (loss) (1)
Losses on foreign currency translation of foreign operations			-		-		-		-		(159,117)		-		-		-		-		(159,117)		(45,099)		(204,216)
Losses on net investment hedge			-		-		-		-		(61,079)		-		-		-		-		(61,079)		-		(61,079)
Unrealized gains on marketable securities at FVTOCI (2)			-		-		-		-		-		26,030		-		-		-		26,030		-		26,030
Unrealized gains (losses) in cash flow hedge			-		-		-		-		-		-		(239,566)		-		-		(239,566)		67		(239,499)
Actuarial gains (losses) on pension and post-employment plans			-		-		-		-		-		-		-		11,852		-		11,852		(123)		11,729
Income (loss) for the period			-		-		-		-		-		-		-		-		(501,816)		(501,816)		6,933		(494,883)
SUB-TOTAL COMPREHENSIVE INCOME (LOSS)			-		-		-		-		(220,196)		26,030		(239,566)		11,852		(501,816)		(923,696)		(38,222)		(961,918)
Realized gain in marketable securities at FVTOCI (2)			-		-				-		-		(33,046)		-		-		33,046		-		-		-
Dividends			-		-				-		-		-		-		-		-		-		(80)		(80)
Share-based payments			-		-		(886)		18,318		-		-		-		-		-		17,432		-		17,432
Acquisition of non-controlling interests (3)			-		-		(79,673)		-		-		-		-		-		-		(79,673)		(113,049)		(192,722)
BALANCES AT SEPTEMBER 30, 2021			12,460,471		141,834		(80,313)		(105,620)		(899,165)		-		(677,787)		(176,775)		(3,062,798)		7,599,847		76,399		7,676,246

			Attributed to controlling shareholders
											Other comprehensive income (loss)
			Capital		Capital reserves		Other equity transactions (4)		Treasury shares		Accumulated foreign currency translation adjustments		Gains (losses) on marketable securities at FVTOCI (2)		Gains (losses) on cash flow hedge		Actuarial gains (losses)		Retained losses		Total equity		Non-controlling interest		Total shareholders' equity (consolidated)
BALANCES AT DECEMBER 31, 2019			12,460,471		141,834		51,011		(38,239)		(193,379)		4,454		(356,721)		(176,823)		(4,131,913)		7,760,695		252,726		8,013,421
Comprehensive income (loss) (1)
Gains (losses) on foreign currency translation of foreign operations			-		-		-		-		(240,273)		-		-		-		-		(240,273)		44,303		(195,970)
Loss on net investment hedge			-		-		-		-		(385,539)		-		-		-		-		(385,539)		-		(385,539)
Gains on marketable securities measured at FVTOCI (2)			-		-		-		-		-		4,257		-		-		-		4,257		-		4,257
Unrealized losses in cash flow hedge			-		-		-		-		-		-		(544,187)		-		-		(544,187)		-		(544,187)
Actuarial gains (losses) on pension and post-employment plans			-		-		-		-		-		-		-		20,229		-		20,229		(95)		20,134
Income for the period			-		-		-		-		-		-		-		-		609,668		609,668		12,866		622,534
SUB-TOTAL COMPREHENSIVE INCOME (LOSS)			-		-		-		-		(625,812)		4,257		(544,187)		20,229		609,668		(535,845)		57,074		(478,771)
Share-based payments			-		-		(1,274)		20,371		-		-		-		-		-		19,097		-		19,097
Acquisition of non-controlling interests			-		-		(50,945)		-		-		-		-		-		-		(50,945)		(54,863)		(105,808)
Acquisition of treasury shares			-		-		-		(106,070)		-		-		-		-		-		(106,070)		-		(106,070)
BALANCES AT SEPTEMBER 30, 2020			12,460,471		141,834		(1,208)		(123,938)		(819,191)		8,711		(900,908)		(156,594)		(3,522,245)		7,086,932		254,937		7,341,869

(1) All changes in other comprehensive income are presented net of taxes.

(2) FVTOCI: Fair Value Through Other Comprehensive Income.

(3) Acquisition of remaining participation in the subsidiary AFC (note 1.1).

(4) Comparative period was restated as described in note 21.2.

The accompanying notes are an integral part of the condensed consolidated interim financial information.

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

		2021		2020
				Restated (3)
		Jan - Sep		Jan - Sep
OPERATING ACTIVITIES
Income (loss) from continuing operations		(447,081)		622,534
Adjustments for:
Depreciation and amortization		1,301,510		1,127,954
Depreciation and depletion of biological assets		754,783		645,551
Result on disposal of property, plant and equipments and investment		(89,775)		24,279
Write-down of inventories to net realizable value		68,965		96,916
Provision for tax, civil and labor risks		73,645		260,311
Financial results, net		2,346,976		1,233,191
Tax recoveries and gains in tax lawsuits		(64,877)		(294,890)
Deferred income tax		(271,803)		187,959
Employee profit sharing		65,255		159,669
Other provisions		5,790		67,558
Cash flow provided by operating activities before working capital		3,743,388		4,131,032
Trade accounts receivable		849,748		827,060
Inventories		(2,385,327)		(1,980,815)
Biological assets - current		(551,526)		(295,995)
Trade accounts payable		1,181,000		1,521,185
Supply chain finance		443,092		282,351
Cash generated by operating activities		3,280,375		4,484,818
Investments in securities at FVTPL (1)		(46,695)		-
Redemptions of securities at FVTPL (1)		66,797		102,172
Interest received		61,872		77,686
Payment of tax, civil and labor provisions		(269,704)		(215,439)
Derivative financial instruments		(35,097)		1,285,272
Payment of income taxes		-		(152)
Other operating assets and liabilities		(123,894)		378,166
Net cash provided by operating activities		2,933,654		6,112,523
INVESTING ACTIVITIES
Investments in securities at amortized cost		(4,060)		-
Redemptions of securities at amortized cost		166,112		-
Investments in securities at FVTOCI (2)		(12,866)		-
Redemptions of securities at FVTOCI (2)		86,059		26,352
Redemption of restricted cash		400		285,622
Additions to property, plant and equipment		(1,050,838)		(542,600)
Additions to biological assets - non-current		(922,801)		(725,484)
Proceeds from disposals of property, plant, equipments and investment		49,340		69,696
Additions to intangible assets		(133,436)		(74,384)
Business combination, net of cash		(983,709)		-
Sale of participation in subsidiaries with loss of control		132,951		38,546
Acquisition of participation in joint ventures and subsidiaries		1,974		(819)
Net cash used in investing activities		(2,670,874)		(923,071)
Net cash provided by investing activities from discontinued operations		(17,550)		-
Net cash used in investing activities		(2,688,424)		(923,071)
FINANCING ACTIVITIES
Proceeds from debt issuance		1,831,117		8,666,404
Repayment of debt		(980,677)		(6,360,934)
Payment of interest		(1,021,601)		(1,002,146)
Payment of interest derivatives - fair value hedge		(1,086)		-
Treasury shares acquisition		-		(106,070)
Acquisition of non-controlling interests		(238,421)		(100,390)
Payment of lease liabilities		(548,911)		(402,259)
Net cash provided by (used in) financing activities		(959,579)		694,605
EFFECT OF EXCHANGE RATE VARIATION ON CASH AND CASH EQUIVALENTS		27,568		1,276,745
Net increase (decrease) in cash and cash equivalents		(686,781)		7,160,802
Balance at the beginning of the period		7,576,625		4,237,785
Balance at the end of the period		6,889,844		11,398,587

(1) FVTPL: Fair Value Through Profit and Loss.

(2) FVTOCI: Fair Value Through Other Comprehensive Income.

(3) Restated according to reclassifications described in note 3.

The accompanying notes are an integral part of the condensed interim financial information.

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1. COMPANY’S OPERATIONS

BRF S.A. (“BRF”) and its subsidiaries (collectively the “Company”) is a publicly traded company, listed on the segment Novo Mercado of Brasil, Bolsa, Balcão (“B3”), under the ticker BRFS3, and listed on the New York Stock Exchange (“NYSE”), under the ticker BRFS. The Company’s registered office is at Rua Jorge Tzachel, nº 475, Bairro Fazenda, Itajaí - Santa Catarina and the main business office is in the city of São Paulo.

BRF is a Brazilian multinational company, with global presence, which owns a comprehensive portfolio of products, and it is one of the world’s largest companies of food products. The Company operates by raising, producing and slaughtering poultry and pork for processing, production and sale of fresh meat, processed products, pasta, margarine and others.

The Company holds as main brands Sadia, Perdigão, Qualy, Chester®, Kidelli, Perdix and Banvit, present mainly in Brazil, Turkey and Middle Eastern countries.

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1.1. Equity interest

Schedule of equity interest

							% equity interest
Entity			Main activity		Country (1)		09.30.21		12.31.20
BRF GmbH			Holding		Austria		100.00		100.00
BRF Foods LLC	(g)		Import, industrialization and commercialization of products		Russia		99.99		99.90
BRF Global Company Nigeria Ltd.			Marketing and logistics services		Nigeria		99.00		99.00
BRF Global Company South Africa Proprietary Ltd.			Administrative, marketing and logistics services		South Africa		100.00		100.00
BRF Global Company Nigeria Ltd.			Marketing and logistics services		Nigeria		1.00		1.00
BRF Global GmbH			Holding and trading		Austria		100.00		100.00
BRF Foods LLC	(h)		Import, industrialization and commercialization of products		Russia		0.01		0.10
BRF Japan KK			Marketing and logistics services, import, export, industrialization and commercialization of products		Japan		100.00		100.00
BRF Korea LLC			Marketing and logistics services		Korea		100.00		100.00
BRF Shanghai Management Consulting Co. Ltd.			Provision of consultancy and marketing services		China		100.00		100.00
BRF Shanghai Trading Co. Ltd.			Import, export and commercialization of products		China		100.00		100.00
BRF Singapore Foods PTE Ltd.			Administrative, marketing and logistics services		Singapore		100.00		100.00
Eclipse Holding Cöoperatief U.A.			Holding		The Netherlands		99.99		99.99
Buenos Aires Fortune S.A.			Holding		Argentina		4.36		4.36
Eclipse Latam Holdings			Holding		Spain		100.00		100.00
Buenos Aires Fortune S.A.			Holding		Argentina		95.64		95.64
Perdigão Europe Lda.			Import, export of products and administrative services		Portugal		100.00		100.00
Perdigão International Ltd.	(d)		Import and export of products		Cayman Island		-		100.00
ProudFood Lda.			Import and commercialization of products		Angola		90.00		90.00
Sadia Chile S.A.			Import, export and commercialization of products		Chile		40.00		40.00
Wellax Food Logistics C.P.A.S.U. Lda.			Import, commercialization of products and administrative services		Portugal		100.00		100.00
BRF Austria GmbH	(o)		Holding		Austria		100.00		100.00
One Foods Holdings Ltd.			Holding		UAE		100.00		100.00
Al-Wafi Food Products Factory LLC			Import, export, industrialization and commercialization of products		UAE		49.00		49.00
Badi Ltd.			Holding		UAE		100.00		100.00
Al-Wafi Al-Takamol International for Foods Products			Import and commercialization of products		Saudi Arabia		100.00		100.00
Joody Al Sharqiya Food Production Factory LLC	(b)		Import and commercialization of products		Saudi Arabia		100.00		-
BRF Al Yasra Food K.S.C.C. ("BRF AFC")	(c)		Import, commercialization and distribution of products		Kuwait		100.00		75.00
BRF Foods GmbH			Industrialization, import and commercialization of products		Austria		100.00		100.00
Al Khan Foodstuff LLC ("AKF")			Import, commercialization and distribution of products		Oman		70.00		70.00
FFQ GmbH	(e)		Industrialization, import and commercialization of products		Austria		-		100.00
TBQ Foods GmbH			Holding		Austria		60.00		60.00
Banvit Bandirma Vitaminli			Import, industrialization and commercialization of products		Turkey		91.71		91.71
Banvit Enerji ve Elektrik ÜretimLtd. Sti.	(a)		Generation and commercialization of electric energy		Turkey		100.00		100.00
Banvit Foods SRL	(f)		Industrialization of grains and animal feed		Romania		-		0.01
Nutrinvestments BV			Holding		The Netherlands		100.00		100.00
Banvit ME FZE			Marketing and logistics services		UAE		100.00		100.00
Banvit Foods SRL	(f)		Industrialization of grains and animal feed		Romania		-		99.99
One Foods Malaysia SDN. BHD.			Marketing and logistics services		Malaysia		100.00		100.00
Federal Foods LLC			Import, commercialization and distribution of products		UAE		49.00		49.00
Federal Foods Qatar			Import, commercialization and distribution of products		Qatar		49.00		49.00
BRF Hong Kong LLC	(a)		Import, commercialization and distribution of products		Hong Kong		100.00		100.00
Eclipse Holding Cöoperatief U.A.			Holding		The Netherlands		0.01		0.01
Establecimiento Levino Zaccardi y Cia. S.A.	(a)		Industrialization and commercialization of dairy products		Argentina		99.99		99.99
BRF Energia S.A.			Commercialization of eletric energy		Brazil		100.00		100.00
BRF Pet S.A.			Industrialization, commercialization and distribution of feed and nutrients for animals		Brazil		100.00		100.00
Affinity Petcare Brasil Participações Ltda.	(n)		Holding		Brazil		100.00		-
Mogiana Alimentos S.A.	(l)		Manufacturing, distribution and sale of Pet Food products		Brazil		50.00		-
Gewinner Participações Ltda.	(j)		Industrialization, distribution and sale of feed and nutrients for animals		Brazil		100.00		-
Hecosul Alimentos Ltda.	(j)		Manufacturing and sale of animal feed		Brazil		100.00		-
Hercosul Distribuição Ltda.	(j)		Import, export, wholesale and retail sale of food products for animals		Brazil		100.00		-
Hercosul Soluções em Transportes Ltda.	(j)		Road freight		Brazil		100.00		-
Hercosul International S.R.L.	(j)		Manufacturing, export, import and sale of feed and nutrients for animals		Paraguay		99.00		-
Paraguassu Participações S.A.	(m)		Holding		Brazil		100.00		-
Mogiana Alimentos S.A.	(l)		Manufacturing, distribution and sale of Pet Food products		Brazil		50.00		-
Hercosul International S.R.L.	(k)		Manufacturing, export, import and sale of feed and nutrients for animals		Paraguay		1.00		-
PP-BIO Administração de bem próprio S.A.	(i)		Management of assets		Brazil		-		33.33
PR-SAD Administração de bem próprio S.A.			Management of assets		Brazil		33.33		33.33
ProudFood Lda.			Import and commercialization of products		Angola		10.00		10.00
PSA Laboratório Veterinário Ltda.			Veterinary activities		Brazil		99.99		99.99
Sino dos Alpes Alimentos Ltda.	(a)		Industrialization and commercialization of products		Brazil		99.99		99.99
Sadia Alimentos S.A.			Holding		Argentina		43.10		43.10
Sadia Chile S.A.			Import, export and commercialization of products		Chile		60.00		60.00
Sadia International Ltd.	(l)		Import and commercialization of products		Cayman Island		-		100.00
Sadia Uruguay S.A.			Import and commercialization of products		Uruguay		100.00		100.00
Sadia Alimentos S.A.			Holding		Argentina		56.90		56.90
Vip S.A. Empreendimentos e Participações Imobiliárias			Commercialization of owned real state		Brazil		100.00		100.00
Establecimiento Levino Zaccardi y Cia. S.A.	(a)		Industrialization and commercialization of dairy products		Argentina		0.01		0.01
PSA Laboratório Veterinário Ltda.			Veterinary activities		Brazil		0.01		0.01
Sino dos Alpes Alimentos Ltda.	(a)		Industrialization and commercialization of products		Brazil		0.01		0.01

(1) UAE – United Arab Emirates.

(a) Dormant subsidiaries. The Company is evaluating the liquidation of these subsidiaries.

(b) On January 18, 2021, 100% of the capital stock of Joody Al Sharqiya Food Production Factory LLC was acquired (note 1.2.1).

(c) On March 9, 2021, the minority stake on BRF AFC was acquired, as described below.

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(d) On March 24, 2021, the subsidiary Perdigão International Ltd. was dissolved.

(e) On March 30, 2021, the subsidiary FFQ GmbH was dissolved.

(f) On May 4, 2021 the sale of shares held in Banvit Foods SRL was concluded, as described below.

(g) On May 31, 2021, BRF GmbH purchased additional 0.09% interest in BRF Food LLC from BRF Global GmbH.

(h) On May 31, 2021, BRF Global GmbH sold 0.09% interest in BRF Food LLC to BRF GmbH.

(i) On July 30, 2021, BRF S.A. sold all the shares held in PP-BIO Administração de bem próprio S.A.

(j) On August 02, 2021, 99% of the capital stock of Hercosul International S.R.L. was acquired by BRF Pet S.A., as per note 1.2.2

(k) On August 02, 2021, 1% of the capital stock of Hercosul International S.R.L. was acquired by BRF S.A., as per note 1.2.2

(l) On August 19, 2021, the subsidiary Sadia International Ltd. was dissolved.

(m) On September 01, 2021, Paraguassu Participações S.A. was acquired by BRF Pet S.A., as per note 1.2.3

(n) On September 01, 2021, Affinity Petcare Brasil Participações Ltda. was acquired by BRF Pet S.A., as per note 1.2.3

(o) On October 21, 2021 it was approved the merger of BRF Austria GmbH into BRF GmbH retroactively to 01 January 2021 according to the Austrian law.

On March 9, 2021 the Company, through its wholly-owned subsidiary One Foods Holdings Ltd.(“One Foods”) acquired from Al Yasra Food Company W.L.L their minority stake of 25% of BRF Al Yasra Food K.S.C.C. (“BRF AFC”), entity located in Kuwait, responsible for the distribution of BRF products in the country. The transaction was concluded for the amount equivalent to R$238,421 (USD40,828) and from this date, BRF AFC became a wholly-owned subsidiary of One Foods. The amount paid is presented in the financing activities on the statement of cash flows and the difference between the amount paid and the book value of the participation acquired was recorded in Equity as Other Reserves, in the amount of R$79,673.

On May 4, 2021, Nutrinvestment BV and Banvit Bandirma Vitaminli, indirectly controlled subsidiaries of the Company, concluded the sale to Aaylex System Group S.A. of 100% of the shares held in Banvit Foods SRL, engaged in the activities of manufacture of animal feed and egg hatchery in Romania. The sale amount, received on that date, was equivalent to R$132,425 (EUR 20,300). In June, the parties established a price adjustment due to net debt and working capital, in the amount equivalent to R$13,059 (EUR2,157). In the nine-month period ended on September 30, 2021, the Company recognized a gain with the sale of R$76,148.

Except for the associate PR-SAD in which the Company records the investments by the equity method, all other entities shown in the table above were consolidated.

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1.2. Business combinations

1.2.1.   Joody Al Sharqiya Food Production Factory

On January 18, 2021, through its wholly-owned subsidiary Badi Limited ("Badi"), the Company concluded the acquisition of 100% of the capital stock of Joody Al Sharqiya Food Production Factory ("Joody Al"), a food processing company in Saudi Arabia. The fair value of the consideration transferred was equivalent to R$41,620 (SAR29,793) paid in cash, and from this date, Joody Al has become a wholly-owned subsidiary of Badi. The purchase price may be adjusted according to certain conditions established in the purchase agreement.

The goodwill of R$12,376 arising from the business combination consists mainly of the synergies expected with the combination of the operations of BRF and Joody Al, strengthening the Company’s presence in the Saudi Arabian market. The results and the goodwill are presented in the International segment (note 24).

The fair value of the acquired assets and assumed liabilities in the business combination is presented below:

		Fair value at the acquisition date
Assets
Cash and cash equivalents		408
Inventories		832
Advances		232
Property, plant and equipment, net		30,128
Total		31,600
Liabilities
Trade accounts payable		1,420
Taxes payable		550
Employee benefits		286
Other current liabilities		100
Total		2,356
Net assets acquired		29,244
Fair value of consideration transferred		41,620
Goodwill		12,376

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1.2.2.   Hercosul Group

On August 2, 2021 the Company concluded the acquisition of 100% of the capital stock of the companies that compose the Hercosul Group, after with the fulfillment of the conditions precedent. From this date, BRF Pet S.A. (“BRF Pet”) became owner of 100% of Gewinner Participações Ltda. and 99% of Hercosul International S.R.L. (“Hercosul International”) and BRF S.A. became owner of 1% of Hercosul International.

The initial fair value of the consideration transferred was of R$794,535 of which R$675,355 was paid in cash and R$119,180 will be paid in the next 4 years. The amount payable is subject to interest and was recorded as other liabilities, with subsequent changes recorded as financial expenses. According to conditions established in the acquisition contract, which are common to transactions of this nature, the value of the consideration may be adjusted based on the net debt, working capital and contingent assets of the Hercosul Group and for which the Company has used its best estimate at the disclosure date of this condensed consolidated interim financial information. There is no maximum amount defined for the price adjustment.

The Company incurred in expenses with advisors, lawyers and other related to the acquisition and integration of Hercosul Group in the amount of R$14,335 for the nine-month period ended on September 30, 2021, which were recognized under administrative expenses.

The preliminary goodwill of R$766,183 recognized in the acquisition consists mainly of the value of the synergies expected from the combination of the operations of BRF Pet, Hercosul Group and Mogiana Group and the value of the acquired intangibles, including brands, which reinforce BRF's presence in the pet food sector. The results, intangible assets with indefinite useful life and goodwill arising from this business combination are presented in Other segments (note 24).

Due to the size and complexity of the Hercosul Group operations, at the disclosure date of this condensed interim financial information, the evaluation by an independent party of the fair value of the assets acquired and liabilities assumed is in progress. The Company's current best estimate of the fair value of the assets and liabilities is presented below and reflected in the Company's condensed consolidated interim financial information:

		Fair value at the acquisition date
		Gewinner Participações Consolidated		Hercosul International
Assets
Cash and cash equivalents		17,743		4,402
Trade and other receivables		40,838		8,475
Inventories		34,355		9,623
Recoverable taxes		15,771		4,078
Advances		29,103		-
Property, plant and equipment, net		23,829		59,135
Intangible assets		647		393
Other assets		773		2,805
Total		163,059		88,911
Liabilities
Social and Labor Obligations		6,681		200
Trade accounts payable		66,760		8,320
Taxes payable		14,879		200
Loans and borrowings		65,825		29,555
Other liabilities		10,720		20,478
Total		164,865		58,753
Net assets acquired		(1,806)		30,158
Fair value of consideration transferred		726,186		68,349
Preliminary goodwill		727,992		38,191

In addition to the information presented above, the following assets will probably have fair value allocations in the business combination and have not yet been measured: inventories, trademarks, customer relationship and fixed assets. Management expects this report to be completed in the beginning of 2022, when the final allocation of the purchase price and its respective accounting effects will be determined.

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This business combination contributed net revenue of R$32,458 and net income of R$2,016 from the acquisition date to September 30, 2021 in the condensed consolidated statement of income. If the business combination had taken place at the beginning of the nine-month period ended September 30, 2021, the consolidated net revenues for this period would have increased by R$198,168 and the consolidated net loss for the period would have increased by R$36,258.

1.2.3.   Mogiana Group

On September 1, 2021, the Company, through its wholly-owned subsidiary BRF Pet dedicated to the pet food sector, concluded the acquisition of Paraguassu Participações S.A. ("Paraguassu") and Affinity Petcare Brasil Participações Ltda. ("Affinity"), both owner of 100% of the capital stock of Mogiana Alimentos S.A. (together form the “Mogiana Group”), after fulfillment of all conditions precedent. Therefore, from this date, Paraguassu and Affinity became wholly-owned subsidiaries of BRF Pet.

The initial fair value of the consideration transferred was of R$435,773 of which R$290,225 was paid in cash and R$145,548 will be paid in the next 6 years. The amount payable is subject to interest and was recorded as other liabilities, with subsequent changes recorded as financial expenses. In addition, from the term value, R$60,000 will be deposited in an escrow account (restricted cash) after the first anniversary of the acquisition, as a guarantee for BRF Pet in case of eventual indemnities provided for in the acquisition contract. According to conditions established in the acquisition contract, which are common to transactions of this nature, the value of the consideration may be adjusted based on the net debt, working capital and contingent assets of Mogiana Alimentos S.A. and for which the Company has used its best estimate at the disclosure date of this condensed consolidated interim financial information. There is no maximum amount defined for the price adjustment.

The Company incurred in expenses with advisors, lawyers and other related to the acquisition and integration of Mogiana in the amount of R$8,146 for the nine-month period ended on September 30, 2021, which were recognized under administrative expenses.

The preliminary goodwill of R$283,426 recognized in the acquisition consists mainly of the value of the synergies expected from the combination of the operations of BRF Pet, Mogiana Group and Hercosul Group and the value of the acquired intangibles, including brands, which reinforce BRF's presence in the pet food sector. The results, intangible assets with indefinite useful life and goodwill arising from this business combination are presented in Other segments (note 24).

Due to the size and complexity of the Mogiana Group operations, at the disclosure date of this condensed interim financial information, the evaluation by an independent party of the fair value of the assets acquired and liabilities assumed is in progress. The Company's current best estimate of the fair value of the assets and liabilities is presented below and reflected in the Company's condensed consolidated interim financial information:

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Mogiana Group Combined		Fair value at the acquisition date
Assets
Cash and cash equivalents		938
Marketable securities		29,842
Trade and other receivables		61,184
Inventories		55,334
Recoverable taxes		29,020
Property, plant and equipment, net		101,618
Intangible assets		1,064
Other assets		5,500
Total		284,500
Liabilities
Trade accounts payable		55,838
Loans and borrowings		22,734
Lease liability		11,147
Taxes payable		10,438
Labor Obligations		6,296
Contingencies		8,363
Employee benefits		2,081
Deferred Taxes		750
Other liabilities		14,506
Total		132,153
Net assets acquired		152,347
Fair value of consideration transferred		435,773
Preliminary goodwill		283,426

In addition to the information presented above, the following assets will probably have fair value allocations in the business combination and have not yet been measured: inventories, trademarks, customer relationship, non-compete agreement and fixed assets. Management expects this report to be completed in the beginning of 2022, when the final allocation of the purchase price and its respective accounting effects will be determined.

This business combination contributed net revenue of R$41,438 and net income of R$1,901 from the acquisition date to September 30, 2021 in the condensed consolidated statement of income. If the business combination had taken place at the beginning of the nine-month period ended on September 30, 2021, the consolidated net revenues for this period would have increased by R$329,418 and the consolidated net loss for the period would be reduced by R$27,955.

1.3. Discontinued Operations

In the nine-month period ended on September 30, 2021, the Company completed the price adjustment process related to sale of Campo Austral S.A. and determined a preliminary price adjustment related to the sale of Avex S.A., which is subject to modifications until the final agreement is signed between the parties.

The referred price adjustment totaled an expense of R$59,270 (R$47,802 net of taxes) and are presented in Net Loss of Discontinued Operations, consistently with the practice adopted in the sale of the operations in 2019.

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1.4. Partnership – self-generation of energy

1.4.1.   Partnership with AES

On August 16, 2021, the Company entered into an investment agreement with a subsidiary of AES Brasil Energia S.A. to incorporate a joint venture for the construction of a wind energy park for self-generation in the wind farm complex of Cajuína, Rio Grande do Norte, with an installed capacity of 160MWm (average Megawatt), generating 80MWm to be supplied to the Company by means of a 15-year power purchase agreement.

Through this partnership, the Company is expected to meet about a third of its energy needs for the Brazilian operations and the operation of the park is scheduled to begin by 2024.

The closing of this partnership is subject to approval of the competent authorities and the verification of other usual conditions in operations of this nature.

1.4.2.   Partnership with PontoOn

On September 16, 2021, the Company together with Intrepid Participações S.A. (“Intrepid”) entered into a 15-year renewable energy power purchase agreement together with a call option agreement, which provides for the entry of BRF, through a holding company jointly held with Intrepid, aiming the construction of a sun energy self-generation plant in Mauriti and Milagres, Ceará, with an installed capacity of 320MWp (Megawatt-peak) generating, on average, 80MWm.

The call option agreement provides BRF with the right to acquire participation in Intrepid for a fixed price. Should BRF exercise the option, the Company will directly invest the approximate amount of R$50 million, to be disbursed during the Project’s development. The operation of the complex is scheduled to begin by 2024.

1.5. Investigations involving BRF

1.5.1. Carne Fraca and Trapaça operations

The Company has been subject to two investigations conducted by Brazilian governmental entities, denominated “Carne Fraca Operation” in 2017 and “Trapaça Operation” in 2018, as detailed in the financial statements for the year ended on December 31, 2020 (note 1.2). The Company’s Audit and Integrity Committee conducted independent investigations, along with the Independent Investigation Committee, composed of external members and with external legal advisors in Brazil and abroad with respect to the allegations involving BRF employees and former employees.

The main impacts observed as result of the referred investigations were recorded in Other Operating Expenses in the amount of R$8,554 for the nine-month period ended on September 30, 2021 (R$28,099 in the same period of the previous year) and R$412 for the three-month period ended on September 30, 2021 (R$4,027 in the same period of the previous year) mostly related to expenditures with lawyers, legal advisors and consultants.

In addition to the impacts already recorded, there are uncertainties about the outcome of these investigations which may result in penalties, fines and normative sanctions, right restrictions and other forms of liabilities, for which the Company is not able to make a reliable estimate of the potential losses. The outcomes may result in payments of substantial amounts, which may cause a material adverse effect on the Company’s financial position, results and cash flows in the future.

Regarding the investigations conducted by regulators offices and governmental entities in the United States of America about these operations, on February 25, 2021, the Division of Enforcement of the U.S. Securities and Exchange Commission (“SEC”) issued a letter to the Company stating that it has concluded its investigation and, based on information to date, does not intend to recommend an enforcement action by the SEC against the Company. On May 5, 2021, the U.S. Department of Justice (“DOJ”) issued a letter stating that it has closed its investigation against BRF, based on information to date. No sanctions or penalties were imposed against the Company.

1.5.2. Governance enhancement

The Company has been taking actions to strengthen the compliance with its policies, procedures and internal controls.

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Among the actions implemented, are: (i) strengthening in the risk management, specially compliance, (ii) continuous improvement of the Compliance, Internal Audit and Internal Controls departments, (iii) review and issuance of new policies and procedures specifically related to applicable anticorruption laws, (iv) review and enhancement of the procedures for reputational verification of business partners, (v) review and enhancement of the processes of internal investigation, (vi) expansion of the independent reporting channel, (vii) review of transactional controls, and (viii) review and issuance of new consequence policy for misconduct.

1.6. Coronavirus (COVID-19)

On January 31, 2020 the World Health Organization announced that the COVID-19 is a global health emergency and on March 11, 2020 declared it a global pandemic. The outbreak has triggered significant decisions from governments and private sector entities, which in addition to the potential impact, increased the uncertainty level for the economic agents and may cause effects in the amounts recognized in the condensed interim financial information.

BRF continues to operate its industrial complexes, distribution centers, logistics, supply chain and administrative offices, even if temporarily and partially under remote work regime in some of the corporate offices. Therefore, until the date of approval of this interim financial information, there has been no relevant change in its production plan, operation and/or commercialization. Additionally, management has developed and implemented contingency plans to maintain the operations and monitors the effects of the pandemic through a permanent multidisciplinary monitoring committee, formed by executives, specialists in the public health area and consultants.

Due to the pandemic, the Company has incurred in direct expenditures, such as transportation, personnel, prevention, control and donations, which are presented in the statement of income (loss) within the following line items:

				2021				2020
		Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Cost of sales (1)		(41,391)		(163,047)		(99,019)		(273,308)
Selling expenses		(27,315)		(51,405)		(2,241)		(48,558)
General and administrative expenses		(3,714)		(20,661)		(43,911)		(69,976)
Total expense		(72,420)		(235,113)		(145,171)		(391,842)

(1) In the nine months ended September 30, 2020 includes non-incremental expenditures related do idleness in the amount of R$55,926.

The management considered in its projections of results and cash flows, to the best of its knowledge, the effects and uncertainties regarding the pandemic. Due to the high volatility and uncertainty around the length and the impact of the pandemic, the Company will continue to monitor the situation and evaluate the impacts on assumptions and estimates used in preparing our financial reporting.

1.7. U.S. Class Action

As disclosed in the Company’s Consolidated Financial Statements for the year ended December 31, 2020 (note 1.3), on March 27, 2020, the parties reached an agreement to settle the shareholder class action lawsuit filed against the Company, by the payment of an amount equivalent to R$204,436 (USD40,000). Since this event evidenced an existing condition as of December 31, 2019, the settlement was reflected in Other Operating Expenses (note 26), with a corresponding increase in deferred income tax of R$69,508 (note 10) in the year ended on December 31, 2019.

The Company is subject to the reporting requirements established by the Brazilian Corporation Law and the regulations of the Securities and Exchange Commission of Brazil (Comissão de Valores Mobiliários, or “CVM”). The liability of this class action lawsuit was not recognized in the financial statements filed with the CVM for the year ended December 31, 2019, which were filed on March 3, 2020. Therefore, the class action lawsuit was recognized in the interim financial information filed with the CVM for the nine months ended September 30, 2020. The main differences between these condensed consolidated interim financial information and those filed with the CVM, resulting from this event, are disclosed below.

		As filed with the CVM	Adjustment for class action settlement	As filed with the SEC	Corresponding notes
		09.30.20	09.30.20	09.30.20	09.30.20
Statement of income (loss)
Other operating income (expenses), net		(113,193)	204,436	91,243	24 and 26
Income taxes		(165,146)	(69,508)	(234,654)	10
Net income from continuing operations		487,606	134,928	622,534	22

1.8. Seasonality

During the months of November and December of each year, the Company is impacted by seasonality in the Brazil operating segment due to Christmas and New Year’s Celebrations. The products that are relevant contributors are: turkey, Chester®, ham and pork cuts (hind leg/pork loin).

In the International operating segment, seasonality is due to Ramadan, which is the holy month of the Muslim calendar. The beginning of Ramadan depends on the beginning of the moon cycle and in 2021 occurred between April 13, 2021 and May 12, 2021.

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2. BASIS OF PREPARATION AND PRESENTATION OF INTERIM FINANCIAL INFORMATION

The condensed consolidated interim financial information was prepared in accordance with the IAS 34 – Interim Financial Reporting issued by the International Accounting Standards Board - IASB. All the relevant information applicable to the condensed consolidated interim financial information, and only them, are being evidenced and correspond to those used by administration in its management.

The condensed consolidated interim financial information is expressed in thousands of Brazilian Reais (“R$”), unless otherwise stated. For disclosures of amounts in other currencies, the values were also expressed in thousands, unless otherwise stated.

The preparation of the condensed consolidated interim financial information requires Management to make judgments, use estimates and adopt assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, as well as the disclosures of contingent liabilities. The uncertainty inherent to these judgments, assumptions and estimates could result in material adjustments to the carrying amount of certain assets and liabilities in future periods.

Any judgments, estimates and assumptions are reviewed at each reporting period.

The condensed consolidated interim financial information was prepared based on the recoverable historical cost, except for the following material items recognized in the statements of financial position:

(i)       derivative financial instruments and non-derivative financial instruments measured at fair value;

(ii)       share-based payments and employee benefits measured at fair value;

(iii)       biological assets measured at fair value; and

(iv)       assets held for sale in instances where the fair value is lower than historical cost.

The Company prepared condensed consolidated interim financial information under the going concern assumption and disclosed all relevant information in its explanatory notes, in order to clarify and complement the accounting basis adopted.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The condensed consolidated interim financial information, in this case quarterly financial information, aim to provide updated information based on the last annual financial statements disclosed. Therefore, the quarterly financial information focus on new activities, events and circumstances and do not repeat the information previously disclosed, except when Management judges that the maintenance of the information is relevant.

The condensed consolidated interim financial information was prepared based on the accounting policies and estimates calculation methodologies adopted in the preparation of the annual financial statements for the year ended December 31, 2020 (note 3), except for: (i) the income taxes, which were measured according to IAS 34 by applying the estimated annual effective tax rate to the pre-tax profit or loss for the interim period; and (ii) reclassification of payment of interest in the statements of cash flows, as described below.

In the nine-month period ended on September 30, 2021, the Company changed the classification of payment of interest in the statement of cash flows, reclassifying this item from Operating Activities to Financing Activities. This change was made for better presentation of the Company’s cash flows and convergence with the reports used by the administration in its management.

To ensure comparability between the periods presented, the Company performed the following reclassifications for the nine-month period ended on September 30, 2020:

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-18

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												Jan - Sep 2020
								Previously presented		Reclassification		Restated
Net cash provided by operating activities								5,110,377		1,002,146		6,112,523
Net cash used in investing activities								(923,071)		-		(923,071)
Net cash provided by (used in) financing activities								1,696,751		(1,002,146)		694,605
Effect of exchange rate variation on cash and cash equivalents								1,276,745		-		1,276,745
Net increase in cash and cash equivalents								7,160,802		-		7,160,802

There were no other changes on such policies and estimates calculation methodologies. As allowed by IAS 34, Management decided not to disclose again the details of the accounting policies adopted by the Company. Hence, the condensed consolidated interim financial information should be read along with the annual financial statements for the year ended on December 31, 2020, in order to allow the users to further understand the Company’s financial conditions and liquidity, as well as its capacity to generate profits and cash flows.

4. CASH AND CASH EQUIVALENTS

Schedule of cash and cash equivalents

					Average rate (1)
							09.30.21		12.31.20
Cash and bank accounts
Turkish lira					-		660,171		347,740
U.S. Dollar					-		633,222		1,185,208
Saudi Riyal					-		351,645		250,879
Brazilian Reais					-		117,762		112,181
Euro					-		67,973		54,687
Other currencies					-		372,324		488,377
							2,203,097		2,439,072
Cash equivalents
In Brazilian Reais
Investment funds					4.12%		4,120		4,684
Bank deposit certificates					5.84%		4,082,178		3,662,448
							4,086,298		3,667,132
In U.S. Dollar
Term deposit					-		-		198,878
Overnight					0.15%		600,449		1,220,232
Other currencies
Term deposit					-		-		51,311
							600,449		1,470,421
							6,889,844		7,576,625

(1) Weighted average annual rate.

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-19

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5. MARKETABLE SECURITIES

Schedule of marketable securities

						Average rate (2)
		WAM (1)		Currency				09.30.21		12.31.20
Fair value through other comprehensive income
Stocks (3)		-		USD / HKD		-		13,290		42,029
Fair value through profit and loss
Financial treasury bills		3.29		R$		1.90%		318,893		312,515
Investment funds - FIDC BRF		2.46		R$		-		14,966		15,044
Committed		0.50		R$		-		22,810		-
Other		0.02		R$ / ARS		-		1,479		1,643
								358,148		329,202
Amortized cost
Sovereign bond and other (4)		1.57		AOA		4.00%		347,650		287,504
								719,088		658,735
Current								343,182		314,158
Non-current (5)								375,906		344,577

(1) Weighted average maturity in years.

(2) Weighted average annual rate.

(3) It’s comprised of Aleph Farms Ltd. stocks on September 30, 2021 and Cofco Meats stocks on December 31, 2020.

(4) It’s comprised of private securities and sovereign securities of the Angola Government and are presented net of expected credit losses in the amount of R$17,943 (R$9,894 on December 31, 2020).

(5) Maturity until December of 2023.

On September 30, 2021, the amount of R$281,649 (R$366,671 on December 31, 2020) classified as cash and cash equivalents and marketable securities were pledged as guarantee, with no use restrictions, for USD denominated future contracts traded on B3.

6. TRADE ACCOUNTS RECEIVABLE AND OTHER RECEIVABLES

Schedule of trade accounts receivable, net and notes receivable

					09.30.21		12.31.20
Trade accounts receivable
Domestic market
Third parties					977,964		2,002,586
Foreign market
Third parties					3,218,914		2,716,551
					4,196,878		4,719,137
( - ) Adjustment to present value					(10,867)		(13,316)
( - ) Expected credit losses					(633,850)		(605,940)
					3,552,161		4,099,881
Current					3,545,760		4,092,855
Non-current					6,401		7,026
Other receivables
Other receivables					93,844		113,949
( - ) Adjustment to present value					(1,409)		(156)
( - ) Expected credit losses					(15,959)		(27,389)
					76,476		86,404
Current					40,991		43,566
Non-current (1)					35,485		42,838

(1) Weighted average maturity of 2.00 years.

The Company performs credit assignments with no right of return to the BRF Clients’ Credit Rights Investment Fund (“FIDC BRF“), which has the sole purpose to acquire credit rights arising from commercial transactions carried out between the Company and its clients in Brazil. On September 30, 2021, FIDC BRF had an outstanding balance of R$770,894 (R$549,083 on December 31, 2020) related to such credit rights, which were written-off of the Company’s statement of financial position when the credits were sold.

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On September 30, 2021, other receivables are mainly represented by receivables from the sale of farms and various properties, with a balance of R$59,468 (R$78,258 on December 31, 2020).

The movements of the expected credit losses are presented below:

		09.30.21		12.31.20
Beginning balance		(605,940)		(503,848)
(Additions) Reversals		(11,627)		(12,137)
Write-offs		9,060		19,451
Exchange rate variation		(25,343)		(109,406)
Ending balance		(633,850)		(605,940)

The aging of trade accounts receivable is as follows:

					09.30.21		12.31.20
Not overdue					3,334,545		4,010,140
Overdue
01 to 60 days					228,974		104,195
61 to 90 days					4,837		6,045
91 to 120 days					3,368		398
121 to 180 days					7,206		7,024
181 to 360 days					10,209		15,688
More than 360 days					607,739		575,647
( - ) Adjustment to present value					(10,867)		(13,316)
( - ) Expected credit losses					(633,850)		(605,940)
					3,552,161		4,099,881

7. INVENTORIES

Schedule of inventories

					09.30.21		12.31.20
Finished goods					5,211,775		3,610,585
Work in progress					234,600		192,335
Raw materials					2,614,888		2,046,681
Packaging materials					172,165		92,256
Secondary materials					610,494		531,801
Supplies					219,876		207,033
Imports in transit					162,140		107,829
Other					162,378		94,816
(-) Adjustment to present value					(129,395)		(80,577)
					9,258,921		6,802,759

The movements in the write-down of inventories to the net realizable value, for which the additions, reversals and write-offs were recorded against Cost of Sales, are presented in the table below:

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-21

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	Realizable value through sale				Impaired inventories				Obsolete inventories				Total
	09.30.21		12.31.20		09.30.21		12.31.20		09.30.21		12.31.20		09.30.21		12.31.20
Beginning balance	(31,155)		(10,712)		(29,831)		(42,526)		(14,719)		(14,919)		(75,705)		(68,157)
Additions	(117,668)		(106,357)		(68,608)		(91,237)		(7,254)		(10,304)		(193,530)		(207,898)
Reversals	124,565		85,816		-		-		-		-		124,565		85,816
Write-offs	-		-		71,824		104,115		7,499		10,688		79,323		114,803
Exchange rate variation	(237)		98		(232)		(183)		(226)		(184)		(695)		(269)
Ending balance	(24,495)		(31,155)		(26,847)		(29,831)		(14,700)		(14,719)		(66,042)		(75,705)

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-22

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8. BIOLOGICAL ASSETS

The live animals are represented by poultry and pork and segregated into consumables and animals for production. The rollforward of the biological assets are presented below:

	Current													Non-current
	Live animals													Live animals
	Poultry					Pork				Total				Poultry				Pork			Forests				Total
	09.30.21			12.31.20		09.30.21		12.31.20		09.30.21		12.31.20		09.30.21		12.31.20		09.30.21		12.31.20	09.30.21		12.31.20		09.30.21		12.31.20
Beginning balance	868,428			615,685		1,260,582		987,354		2,129,010		1,603,039		472,053		414,668		425,252		337,804	324,444		328,553		1,221,749		1,081,025
Additions/Transfer	10,109,223			9,705,994		7,014,758		7,108,084		17,123,981		16,814,078		66,375		71,494		331,740		363,027	29,489		38,536		427,604		473,057
Changes in fair value (1)	1,850,293			2,059,397		330,097		368,019		2,180,390		2,427,416		97,527		51,660		(152,576)		(184,005)	-		21,711		(55,049)		(110,634)
Harvest	-			-		-		-		-		-		-		-		-		-	(36,945)		(59,586)		(36,945)		(59,586)
Write-off	-			-		-		-		-		-		-		-		-		-	(2,067)		(5,099)		(2,067)		(5,099)
Transfer between current  and non-current	72,776			57,164		91,501		91,574		164,277		148,738		(72,776)		(57,164)		(91,501)		(91,574)	-		-		(164,277)		(148,738)
Transfer to assets held for sale	-			-		-		-		-		-		-		(10,389)		-		-	-		329		-		(10,060)
Transfer to inventories	(11,793,780)			(11,571,369)		(7,123,342)		(7,294,449)		(18,917,122)		(18,865,818)		-		-		-		-	-		-		-		-
Exchange variation	(12,471)			1,557		-		-		(12,471)		1,557		(8,183)		1,784		-		-	-		-		(8,183)		1,784
Ending balance	1,094,469			868,428		1,573,596		1,260,582		2,668,065		2,129,010		554,996		472,053		512,915		425,252	314,921		324,444		1,382,832		1,221,749

(1) The change in the fair value of biological assets includes depreciation of breeders and depletion of forests in the amount of R$754,783 (R$876,976 on December 31, 2020).

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-23

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The estimated balances and quantities of live animals are set forth below:

	09.30.21				12.31.20
	Quantity (thousand of heads)		Book value		Quantity (thousand of heads)		Book value
Consumable biological assets
Immature poultry	228,202		1,094,469		199,877		868,428
Immature pork	4,171		1,573,596		4,204		1,260,582
Total current	232,373		2,668,065		204,081		2,129,010
Production biological assets
Immature poultry	6,525		210,896		7,320		188,967
Mature poultry	11,502		344,100		11,395		283,086
Immature pork	208		126,619		203		93,466
Mature pork	454		386,296		457		331,786
Total non-current	18,689		1,067,911		19,375		897,305
	251,062		3,735,976		223,456		3,026,315

The Company has forests pledged as collateral for financing and tax/civil contingencies on September 30, 2021 in the amount of R$72,677 (R$68,381 on December 31, 2020).

9. RECOVERABLE TAXES

The rollforward of recoverable taxes are set forth below:

		Note		12.31.20		Business combination (note 1.2)		Additions		Compensations / Reversals		Transfers (1)		Interest		Exchange variation		09.30.21
ICMS and VAT
Recoverable ICMS and VAT				1,568,975		7,523		425,762		(108,947)		(134,393)		180		(2,621)		1,756,479
(-) Impairment				(154,721)		-		(23,020)		28,557		17,104		-		-		(132,080)
PIS and COFINS		9.1
Recoverable PIS and COFINS				3,168,099		35,268		371,314		(888,864)		-		56,881		-		2,742,698
(-) Impairment				(14,228)		-		-		-		-		-		-		(14,228)
IPI		9.2
Recoverable IPI				808,528		1,149		5,368		(460)		-		76,526		-		891,111
(-) Impairment				(1,984)		-		-		-		-		-		-		(1,984)
INSS
Recoverable INSS				341,825		12		13,955		(56,356)		-		3,800		-		303,236
(-) Impairment				(102)		-		-		-		-		-		-		(102)
Other
Other recoverable taxes				52,889		3,995		28,768		(1,408)		-		-		(34)		84,210
(-) Impairment				(1,963)		-		-		20		-		-		-		(1,943)
Total				5,767,318		47,947		822,147		(1,027,458)		(117,289)		137,387		(2,655)		5,627,397
Current				899,120														883,740
Non-current				4,868,198														4,743,657
				12.31.20		Business combination		Additions		Compensations / Reversals		Transfers (1)		Interest		Exchange variation		09.30.21
Income taxes
Recoverable income taxes				107,728		922		69,015		(13,634)		-		135		(337)		163,829
(-) Impairment				(9,029)		-		-		-		-		-		-		(9,029)
Total				98,699		922		69,015		(13,634)		-		135		(337)		154,800
Current				43,840														94,936
Non-current				54,859														59,864

(1) The transfers occur from Recoverable Taxes to Other Current Assets and Other Non-Current Assets when sales of credits are made to third parties.

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		Note		12.31.19		Additions		Compensations		Transfers (1)		Restatement		Exchange variation		12.31.20
ICMS and VAT		9.1
Recoverable ICMS and VAT				1,635,663		570,056		(549,446)		(127,370)		240		39,832		1,568,975
(-) Impairment				(141,193)		(38,033)		3,022		21,483		-		-		(154,721)
PIS and COFINS		9.2
Recoverable PIS and COFINS				2,990,313		729,213		(594,483)		-		43,056		-		3,168,099
(-) Impairment				(16,922)		-		2,694		-		-		-		(14,228)
IPI		9.3
Recoverable IPI				848,865		2,319		(7,201)		(92,812)		57,357		-		808,528
(-) Impairment				(3,818)		(263)		2,097		-		-		-		(1,984)
INSS
Recoverable INSS				255,967		88,621		(7,663)		-		4,893		7		341,825
(-) Impairment				(102)		-		-		-		-		-		(102)
Other taxes
Other recoverable taxes				80,145		11,952		(901)		(38,277)		-		(30)		52,889
(-) Impairment				(5,639)		-		3,676		-		-		-		(1,963)
Total				5,643,279		1,363,865		(1,148,205)		(236,976)		105,546		39,809		5,767,318
Current				473,732												899,120
Non-current				5,169,547												4,868,198
		Note		12.31.19		Additions		Compensations		Transfers (1)		Restatement		Exchange variation		12.31.20
Income taxes		9.4
Recoverable income taxes				430,778		58,007		(422,496)		-		4,341		37,098		107,728
(-) Impairment				(9,029)		-		-		-		-		-		(9,029)
Total				421,749		58,007		(422,496)		-		4,341		37,098		98,699
Current				152,486												43,840
Non-current				269,263												54,859

(1) The transfers occur from Recoverable Taxes to Other Current Assets and Other Non-Current Assets when sales of credits are made to third parties.

9.1. PIS and COFINS –Social Integration Plan and Contribution for Social Security Financing

On December 7, 2020 and July 13, 2021, the processes filed by Batávia S.A. (subsidiary incorporated by BRF S.A.) and UP! Alimentos Ltda. (an entity jointly controlled by BRF S.A., whose operations were closed), respectively, granting the Company the right to exclude ICMS from the PIS and COFINS calculation basis. The Company, supported by its consultants, obtained the fiscal files for the period and reconciled them with the accessory obligations, measuring the credits reliably through the ICMS presented in the invoices. Thus, the amount of R$90,935 was recognized under Recoverable PIS and COFINS, being R$40,501 of principal recorded in Other Operating Income and R$50,434 of interests recorded in Financial Income.

As of September 30, 2021, the updated balance of the processes related to the exclusion of the ICMS from the PIS and COFINS calculation basis recognized by the Company is R$2,396,028 (R$2,818,391 as of December 31, 2020). The amount of R$554,287 related do these credits was offset against other federal taxes in the nine-month period ended on September 30, 2021 (null in the same period of the previous year). 

In the study prepared by the Management, its realization is estimated through offsetting with federal taxes or through reimbursement of the amounts as expected below:

	PIS and COFINS
Current	499,000
Non-current	1,897,028
October to december 2022	327,516
2023	537,000
2024	672,000
2025	360,512
Total	2,396,028

9.2. IPI - Industrialized Product Tax

The Company recognized relevant tax assets as result of gains from lawsuits related to IPI, specially “crédito prêmio”. The balance referring to these assets on September 30, 2021 is R$938,824 (R$860,820 on December 31, 2020), of which R$881,527 (R$805,001 on December 31, 2020) is recorded as Recoverable Taxes and the remainder, referring to cases in which the government will reimburse in cash, is recorded as Other Current Assets, in the amount of R$40,370 (the same amount on December 31, 2020) and as Other Non-Current Assets, in the amount of R$16,927 (R$15,449 on December 31, 2020).

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According to projections prepared by the Management, its realization is estimated through the refund of the amounts as expected below:

	IPI
Current	40,370
Non-current	898,454
October to december 2022	16,927
2025	647,252
2026	234,275
Total	938,824

9.3. Realization of Brazilian federal tax credits

The Company received in cash, through court orders related to IPI credits, the amount of R$1,368 in the nine-month period ended on September 30, 2021 (R$235,405 in the same period of the previous year).

The Company used PIS, COFINS, IPI, IRPJ, CSLL, INSS and other tax credits to offset federal taxes payable such as INSS and Income Taxes in the amount of R$944,853 in the nine-month period ended September 30, 2021 (R$694,206 in the same period of the previous year), preserving its liquidity and optimizing its capital structure.

10. DEFERRED INCOME TAXES

Schedule of deferred income and social contribution taxes

10.1. Breakdown

					09.30.21		12.31.20
Assets
Tax losses carryforward					2,065,129		2,060,846
Negative calculation basis (social contribution)					773,829		772,283
Temporary differences - Assets
Provisions for tax, civil and labor risks					479,238		458,019
Suspended collection taxes					2,754		1,871
Expected credit losses					180,735		194,977
Impairment on tax credits					56,136		67,900
Provision for other obligations					106,406		115,959
Employees' profit sharing					24,646		86,752
Write-down to net realizable value of inventories					17,461		19,189
Employees' benefits plan					242,815		216,510
Lease basis difference					111,216		86,308
Adjustment to the expcted annual rate					557,112		-
Other temporary differences					21,624		40,028
					4,639,101		4,120,642
Temporary differences - Liabilities
Goodwill amortization basis difference					(292,732)		(320,729)
Depreciation (useful life) basis difference					(871,534)		(851,436)
Business combination (1)					(909,127)		(761,429)
Unrealized gains on derivatives, net					(18,045)		(42,493)
Unrealized fair value gains, net					(32,340)		(39,269)
Other temporary differences					(44,800)		(22,749)
					(2,168,578)		(2,038,105)
Total deferred taxes					2,470,523		2,082,537
Total Assets					2,505,005		2,109,064
Total Liabilities					(34,482)		(26,527)
					2,470,523		2,082,537

(1) The deferred tax asset on the Sadia business combination was recorded on the amortization difference between the accounting and tax goodwill calculated as of the purchase price allocation date. The deferred tax liability on the Sadia business combination is substantially represented by the allocation of goodwill to property, plant and equipment, brands and contingent liabilities.

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The roll-forward of deferred income taxes, net, is set forth below: 

		09.30.21		12.31.20
Beginning balance		2,082,537		1,830,060
Deferred taxes on profit recognized in income of continuing operations		271,803		172,763
Deferred income taxes recognized in other comprehensive income		116,986		32,070
Deferred taxes on profit recognized in income of discontinued operations		11,468		-
Other (1)		(12,271)		47,644
Ending balance		2,470,523		2,082,537

(1) Related to the foreign exchange variation effect on the balances in foreign companies.

10.2. Estimated period of realization

Deferred tax assets arising from temporary differences will be realized as the differences are settled or realized. The period of settlement or realization of such differences is subject to externalities and is linked to several factors that are not under the control of Management.

In estimating the realization of deferred tax credits on tax losses carryforward, Management considers its budget and strategic plans, which were approved by the Board of Directors, adjusted based on the estimates of the main tax additions and exclusions. The recoverability study is reviewed by the Fiscal Council and approved by the Board of Directors. Based on this estimate, Management believes that it is probable that these deferred tax credits will be realized, as presented below:

2021			111,727
2022			140,612
2023			231,408
2024			291,677
2025			335,681
2026 to 2028			1,035,323
2029 onwards			692,530
			2,838,958

The Company has tax losses carryforward in Brazil, which at current tax rates represent R$5,381,785 on September 30, 2021 (R$4,589,674 on December 31, 2020). Within this amount, R$2,822,245 on September 30, 2021 and on December 31, 2020 are recognized as an asset, according to the recoverability expectation above (R$16,713 is related to jurisdictions other than Brazil). The deferred tax credits on tax losses and negative social contribution basis related to the parent company and its subsidiaries domiciled in Brazil do not expire and the use to offset income taxes payable is limited to 30% of future taxable income.

10.3. Effective income tax rate reconciliation

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Schedule of income and social contribution taxes reconciliation

											2021				2020
									Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Income (loss) before taxes - continued operations									(254,478)		(408,263)		307,658		857,188
Nominal tax rate									34%		34%		34%		34%
Benefit (expense) at nominal rate									86,523		138,809		(104,604)		(291,444)
Adjustments to income taxes
Difference of tax rates on results of foreign subsidiaries									3,969		26,062		62,127		1,060,802
Difference of functional currency of foreign subsidiaries									264,645		(25,589)		289,404		1,343,322
Deferred tax assets not recognized (1)									(420,364)		(792,387)		(136,621)		(2,427,841)
Share-based payment									(6,928)		(18,215)		(11,906)		(16,718)
Penalties									(3,690)		(7,012)		367		(5,813)
Investment grant									25,293		59,454		21,441		40,955
Adjustment to the expcted annual rate									38,464		557,112		(216,245)		58,806
Other permanent differences									(4,417)		22,948		7,088		3,277
Total									(16,505)		(38,818)		(88,949)		(234,654)
Effective rate									-6.5%		-9.5%		28.9%		27.4%
Current tax									5,020		(310,621)		(8,363)		(46,695)
Deferred tax									(21,525)		271,803		(80,586)		(187,959)

(1) Amount related to the non-recognition of deferred tax on tax losses carryforward in the amount of R$2,330,550, due to limited capacity of realization (note 10.2).

The Company’s management determined that the total profits recorded by the holdings of its wholly-owned subsidiaries abroad will not be redistributed. Such funds will be used for investments in the wholly-owned subsidiaries.

Income tax returns in Brazil are subject to review by the tax authorities for a period of five years from the date of their delivery. The Company may be subject to additional collection of taxes, fines and interest as a result of these reviews. The results obtained by subsidiaries abroad are subject to taxation in accordance with the tax laws of each country.

11. JUDICIAL DEPOSITS

The rollforward of the judicial deposits is set forth below:

Schedule of detailed information about judicial deposits

	Tax				Labor				Civil, commercial and other				Total
	09.30.21		12.31.20		09.30.21		12.31.20		09.30.21		12.31.20		09.30.21		12.31.20
Beginning balance	248,990		244,977		269,812		301,808		34,539		28,965		553,341		575,750
Additions	5,005		12,294		78,478		133,847		8,956		6,719		92,439		152,860
Release in favor of the Company	(1,728)		(11,948)		(31,350)		(51,414)		(817)		(370)		(33,895)		(63,732)
Release in favor of the counterparty	(207)		(907)		(93,479)		(126,405)		(3,168)		(2,055)		(96,854)		(129,367)
Business combination (note 1.2)	2,132		-		859		-		-		-		2,991		-
Interest	2,811		4,574		19,972		11,980		2,308		1,280		25,091		17,834
Exchange rate variation	-		-		(7)		(4)		-		-		(7)		(4)
Ending balance	257,003		248,990		244,285		269,812		41,818		34,539		543,106		553,341

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12. PROPERTY, PLANT AND EQUIPMENT, NET

The rollforward of property, plant and equipment is set forth below:

Schedule of detailed information about property, plant and equipment

	Average rate (1)		12.31.20		Additions		Disposals		Business combination (note 1.2)		Transfers (2)		Exchange rate variation		09.30.21
Cost
Land			608,389		4,799		(6,879)		11,351		97,103		(1,590)		713,173
Buildings, facilities and improvements			10,444,526		398,380		(123,275)		68,178		307,450		(3,068)		11,092,191
Machinery and equipment			8,395,520		109,967		(184,601)		120,359		186,388		10,509		8,638,142
Furniture and fixtures			157,085		671		(5,020)		2,870		6,480		(3,058)		159,028
Vehicles			346,218		46,355		(23,460)		2,037		724		2,049		373,923
Construction in progress			608,255		1,015,219		(4)		9,915		(613,508)		2,436		1,022,313
Advances to suppliers			12,748		21,934		-		-		(16)		(1,360)		33,306
			20,572,741		1,597,325		(343,239)		214,710		(15,379)		5,918		22,032,076
Depreciation
Land (3)	15.34%		(13,800)		(8,963)		1,734		-		(11,335)		(1,169)		(33,533)
Buildings, facilities and improvements	9.09%		(3,851,225)		(598,869)		75,706		-		7,876		(5,586)		(4,372,098)
Machinery and equipment	6.93%		(4,304,007)		(402,819)		166,577		-		2,777		(7,387)		(4,544,859)
Furniture and fixtures	6.66%		(79,924)		(8,597)		4,023		-		672		1,529		(82,297)
Vehicles	25.25%		(108,205)		(77,548)		14,653		-		1		(5,448)		(176,547)
			(8,357,161)		(1,096,796)		262,693		-		(9)		(18,061)		(9,209,334)
			12,215,580		500,529		(80,546)		214,710		(15,388)		(12,143)		12,822,742

(1) Weighted average annual rate.

(2) Refers to the transfer of R$23,431 to intangible assets and R$8,043 from assets held for sale.

(3) Land depreciation refers to right-of-use assets. The amount of R$3,083 of depreciation was recognized in the cost of formation of forests and will be realized in the result according to the depletion (note 17.1).

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	Average rate (1)		12.31.19		Additions		Disposals		Transfers (2)		Exchange rate variation		12.31.20
Cost
Land			603,479		7,582		(13,665)		6,031		4,962		608,389
Buildings, facilities and improvements			10,148,798		287,834		(148,793)		268		156,419		10,444,526
Machinery and equipment			8,177,047		20,293		(166,183)		278,530		85,833		8,395,520
Furniture and fixtures			140,439		851		(8,604)		18,946		5,453		157,085
Vehicles			213,199		165,737		(54,491)		(5,639)		27,412		346,218
Construction in progress			348,907		778,151		-		(516,360)		(2,443)		608,255
Advances to suppliers			528		8,885		-		3,851		(516)		12,748
			19,632,397		1,269,333		(391,736)		(214,373)		277,120		20,572,741
Depreciation
Land (3)	21.32%		(5,086)		(7,132)		813		(1,802)		(593)		(13,800)
Buildings, facilities and improvements	9.45%		(3,263,801)		(688,767)		122,812		15,895		(37,364)		(3,851,225)
Machinery and equipment	6.64%		(3,950,250)		(487,956)		110,163		56,748		(32,712)		(4,304,007)
Furniture and fixtures	6.67%		(71,779)		(11,704)		6,931		(801)		(2,571)		(79,924)
Vehicles	25.87%		(64,592)		(72,562)		41,236		2,389		(14,676)		(108,205)
			(7,355,508)		(1,268,121)		281,955		72,429		(87,916)		(8,357,161)
			12,276,889		1,212		(109,781)		(141,944)		189,204		12,215,580

(1) Weighted average annual rate.

(2) Refers to the transfer of R$45,245 for intangible assets, R$96,788 to held for sale and R$(89) for biological assets.

Land depreciation refers to right-of-use assets. The amount of R$4,266 of depreciation was recognized in the cost of formation of forests and will be realized in the result according to the depletion (note 17.1).

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The amount of capitalized borrowing costs during the nine-month period ended on September 30, 2021 was of R$36,620 (R$13,745 in the same period of the previous year) and during the three-month period ended on September 30, 2021 was of R$13,278 (R$5,357 in the same period of the previous year).

The weighted average rate used to determine the amount of borrowing costs subject to capitalization was 7.27% p.a. (6.15% p.a. in the same period of the previous year).

The book value of the property, plant and equipment items that are pledged as collateral for transactions of different natures are set forth below:

Schedule of book value of the collateral property, plant and equipment

		Type of collateral		09.30.21		12.31.20
Land		Financial/Tax		150,852		223,918
Buildings, facilities and improvements		Financial/Tax		1,204,773		1,491,531
Machinery and equipment		Financial/Labor/Tax/Civil		1,288,772		1,470,295
Furniture and fixtures		Financial/Tax		15,034		15,700
Vehicles		Financial/Tax		305		294
				2,659,736		3,201,738

13. INTANGIBLE ASSETS

The intangible assets rollforward is set forth below:

	Average rate (1)		12.31.20		Additions		Disposals		Business combination (note 1.2)		Transfers		Exchange rate variation	09.30.21
Cost
Goodwill			2,935,577		-		(6,145)		1,061,987		-		40,012	4,031,431
Trademarks			1,327,738		-		-		275		-		(21,752)	1,306,261
Non-compete agreement			107,162		378		(3,079)		-		-		1,652	106,113
Outgrowers relationship			5,328		197		-		-		-		-	5,525
Patents			6,205		-		(3,723)		-		-		3	2,485
Customer relationship			1,067,713		-		-		-		-		(3,161)	1,064,552
Software			657,255		5,218		(581)		1,826		143,434		(324)	806,828
Intangible in progress			46,054		132,856		-		-		(120,008)		(14)	58,888
			6,153,032		138,649		(13,528)		1,064,088		23,426		16,416	7,382,083
Amortization
Non-compete agreement	21.56%		(97,408)		(7,596)		3,079		-		-		(1,447)	(103,372)
Outgrowers relationship	15.82%		(4,695)		(439)		-		-		-		-	(5,134)
Patents	10.00%		(5,999)		(18)		3,723		-		-		(1)	(2,295)
Customer relationship	7.39%		(375,131)		(59,525)		-		-		-		(2,236)	(436,892)
Software	40.48%		(449,697)		(140,218)		463		-		5		102	(589,345)
			(932,930)		(207,796)		7,265		-		5		(3,582)	(1,137,038)
			5,220,102		(69,147)		(6,263)		1,064,088		23,431		12,834	6,245,045

(1) Weighted average annual rate.

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	Average rate (1)		12.31.19		Additions		Disposals		Transfers (2)		Exchange rate variation		12.31.20
Cost
Goodwill			2,713,602		-		-		(6,970)		228,945		2,935,577
Trademarks			1,322,262		-		-		-		5,476		1,327,738
Non-compete agreement			99,229		413		(379)		-		7,899		107,162
Outgrowers relationship			14,604		-		(9,276)		-		-		5,328
Patents			6,305		-		(115)		-		15		6,205
Customer relationship			892,758		-		-		-		174,955		1,067,713
Software			523,615		73,423		(45,851)		97,117		8,951		657,255
Intangible in progress			12,151		95,111		-		(61,434)		226		46,054
			5,584,526		168,947		(55,621)		28,713		426,467		6,153,032
Amortization
Non-compete agreement	23.41%		(74,190)		(18,784)		379		-		(4,813)		(97,408)
Outgrowers relationship	12.75%		(12,744)		(1,030)		9,079		-		-		(4,695)
Patents	10.00%		(5,626)		(476)		115		-		(12)		(5,999)
Customer relationship	7.35%		(242,263)		(79,969)		-		-		(52,899)		(375,131)
Software	34.22%		(341,624)		(153,288)		43,718		9,562		(8,065)		(449,697)
			(676,447)		(253,547)		53,291		9,562		(65,789)		(932,930)
			4,908,079		(84,600)		(2,330)		38,275		360,678		5,220,102

(1) Weighted average annual rate.

(2) Related to transfer of R$6,970 to assets held for sales.

During the nine-month period ended on September 30, 2021, Management did not identify any event that could indicate an impairment of such assets. 

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14. LOANS AND BORROWINGS

Schedule of loan and financing

	Charges (p.a.)		Average rate (1)		WAMT (2)		12.31.20		Borrowing		Business combination (note 1.2)		Amortization		Interest paid		Interest accrued		Exchange rate variation		09.30.21
Local currency
Working capital	Fixed / CDI		5.36% (3.25% on 12.31.20)		1.0		368,681		300,000		25,950		(364,451)		(11,466)		8,764		-		327,478
Certificate of agribusiness receivables (3)	IPCA		15.58% (10.21% on 12.31.20)		2.2		821,093		-		-		-		95		100,446		-		921,634
Development bank credit lines	TJLP / TLP/ IPCA / FINAME		3.13%		6.1		-		-		9,006		(344)		-		14		-		8,676
Debentures	CDI / IPCA		14.36% (8.28% on 12.31.20)		7.6		3,022,005		965,549		-		-		(143,009)		282,313		-		4,126,858
Export credit facility (4)	Fixed / CDI / FX USD		8.40% (3.69% on 12.31.20)		1.2		2,408,697		-		20,456		(524)		(107,941)		84,278		96,641		2,501,607
Fiscal incentives	Fixed		2.40% (2.40% on 12.31.20)		-		44,816		63,700		-		(82,401)		(627)		647		-		26,135
							6,665,292		1,329,249		55,412		(447,720)		(262,948)		476,462		96,641		7,912,388
Foreign currency
Bonds	Fixed / FX USD and EUR		4.82% (4.81% on 12.31.20)		11.7		14,829,993		-		-		(312,741)		(703,844)		667,042		560,242		15,040,692
Export credit facility	Fixed / LIBOR / FX USD		3.50% (3.13% on 12.31.20)		1.6		392,636		-		30,476		(135,668)		(6,649)		7,807		18,300		306,902
Advances for foreign exchange rate contracts	Fixed / FX USD		1.32%		0.4		-		249,000		2,672		-		-		472		9,840		261,984
Working capital	Fixed / FX TRY and USD		13.64% (10.98% on 12.31.20)		1.8		516,505		252,868		29,555		(84,548)		(48,160)		61,976		(71,560)		656,636
							15,739,134		501,868		62,703		(532,957)		(758,653)		737,297		516,822		16,266,214
							22,404,426		1,831,117		118,115		(980,677)		(1,021,601)		1,213,759		613,463		24,178,602
Current							1,059,984														2,861,250
Non-current							21,344,442														21,317,352

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	Charges (p.a.)		Average rate (1)		WAMT (2)		12.31.19		Borrowing		Amortization		Interest paid		Interest accrued		Exchange rate variation		12.31.20
Local currency
Working capital	Fixed / CDI		3.25% (6.07% on 12.31.19)		0.6		3,312,639		1,200,000		(3,947,237)		(340,227)		143,506		-		368,681
Certificate of agribusiness receivables (3)	CDI / IPCA		10.21% (6.73% on 12.31.19)		3.0		1,597,447		-		(780,000)		(100,932)		104,578		-		821,093
Development bank credit lines	Fixed / Selic / TJLP		(5.09% on 12.31.19)		-		45,516		-		(45,470)		(427)		381		-		-
Debentures	CDI / IPCA		8.28% (7.40% on 12.31.19)		7.7		755,760		2,124,725		-		(38,339)		179,859		-		3,022,005
Export credit facility (4)	Fixed / CDI / USD		3.69% (5.83% on 12.31.19)		6.8		1,612,365		1,490,809		(1,113,176)		(111,498)		152,968		377,229		2,408,697
Special program asset restructuring	IGPM		(12.22% on 12.31.19)		-		284,308		-		(287,621)		(5,142)		8,455		-		-
Fiscal incentives	Fixed		2.40% (2.40% on 12.31.19)		-		5,720		73,671		(34,609)		(667)		701		-		44,816
							7,613,755		4,889,205		(6,208,113)		(597,232)		590,448		377,229		6,665,292
Foreign currency
Bonds	Fixed / USD / EUR		4.81% (4.36% on 12.31.19)		12.4		10,407,484		4,282,961		(3,010,421)		(760,879)		881,137		3,029,711		14,829,993
Export credit facility	Fixed / LIBOR / USD		3.13% (5.77% on 12.31.19)		2.2		407,275		-		(118,113)		(20,686)		17,627		106,533		392,636
Advances for foreign exchange rate contracts	Fixed / USD		-		-		-		529,211		(529,210)		-		-		(1)		-
Working capital	Fixed / TRY		10.98% (16.56% on 12.31.19)		1.2		191,765		718,956		(381,502)		(42,742)		46,704		(16,676)		516,505
							11,006,524		5,531,128		(4,039,246)		(824,307)		945,468		3,119,567		15,739,134
							18,620,279		10,420,333		(10,247,359)		(1,421,539)		1,535,916		3,496,796		22,404,426
Current							3,132,029												1,059,984
Non-current							15,488,250												21,344,442

(1) Weighted average annual rate.

(2) Weighted average maturity in years.

(3) The Certificates of Agribusiness Receivables (“CRA”) issued by the Company are backed by receivables of BRF S.A. from certain subsidiaries abroad.

(4) The Export Credit Facility was issued in Reais simultaneously and in connection with a foreign exchange rate swap, resulting essentially in a net cash flow in U.S. Dollars. As the transactions are inseparable, both are recorded together under Loans and Borrowings by their amortized cost.

On September 30, 2021 and on December 31, 2020 the Company did not have any financial covenant clauses related to its loans and borrowings agreements.

The maturity schedule of the loans and borrowings is presented on note 23.3.

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-34

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14.1. Revolving credit facility

With the purpose of maintaining a prudential and sustainable short-term liquidity position, in line with the adoption of measures to extend its average debt maturity and reduce the cost of debt, on December 27, 2019, the Company retained from Banco do Brasil a revolving credit facility up to the limit of R$1,500,000 for a period of three years. On October 28, 2020 the Company retained an additional revolving credit facility before Banco do Brasil, up to the limit of R$1,500,000, for the next three years. The referenced credit facilities can be withdrawn totally or partially, at the Company’s will, whenever necessary. As of September 30, 2021, the credit facilities were available, but unused.

14.2. Issuance of debentures

On June 02, 2021, 1,000,000 (one million) Debentures were subscribed with a notional value of R$ 1,000.00 (one thousand Brazilian Reais), in a total amount of R$1,000,000, in a single series. The Debentures are simple, not convertible into shares, unsecured and for private placement. The Debentures were privately placed with VERT Companhia Securitizadora, to back its sixtieth issuance of Agribusiness Receivables Certificates which were object of public distribution with restricted placement efforts.

Schedule of loan and financing

09.30.21

Operation

Series

Issue date

Maturity

Rate

Notional

Updated Value

Debenture - 3rd Issue

1st Series

06.02.21

05.14.31

IPCA + 4.78% p.a.

1,000,000

1,018,992

The issuance costs of R$34,258 are recognized on the statement of income over the term of the debt according to the effective interest rate method.

14.3. Senior Notes repurchase offer

During June 2021, the Company made an offer to repurchase its 4.875% Senior Notes due on 2030, in which it repurchased the principal amount equivalent to R$297,141 (USD59,402). The Company paid the amount of R$317,532 for the repurchase of these liabilities, amount that includes principal, interest and premium. The Company incurred in financial expenses in the amount of R$14,114 with the premium paid, R$2,491 with taxes and R$3,089 with the write-off of the costs of issuance. The principal outstanding after the repurchase is equivalent to R$3,454,509 (USD690,598).

14.4. Guarantees

Schedule of commitment for purchase goods and services

					09.30.21		12.31.20
Total loans and borrowings					24,178,602		22,404,426
Mortgage guarantees					44,182		44,816
Related to tax incentives and other					44,182		44,816

On September 30, 2021, the amount of bank guarantees contracted by the Company was of R$556,103 (R$590,933 as of December 31, 2020) which were offered mainly in litigations involving the Company’s use of tax credits. These guarantees have an average cost of 1.93% p.a. (1.95% p.a. as of December 31, 2020). 

15. TRADE ACCOUNTS PAYABLE

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Schedule of trade and accounts payable

					09.30.21		12.31.20
Trade accounts payable
Domestic market
Third parties					9,216,162		7,611,170
Foreign market
Third parties					1,979,481		1,487,206
					11,195,643		9,098,376
(-) Adjustment to present value					(106,447)		(88,389)
Trade and accounts payable					11,089,196		9,009,987
Current					11,077,197		8,996,206
Non-current					11,999		13,781

Within the trade accounts payable balance as of September 30, 2021, R$3,551,550 (R$2,576,071 as of December 31, 2020) correspond to supply chain finance transactions in which there were no changes in the payment terms and prices negotiated with the suppliers.

16. SUPPLY CHAIN FINANCE

Schedule of supply chain finance

		09.30.21		12.31.20
Supply chain finance
Domestic market		1,749,226		1,309,167
Foreign market		168,093		165,060
Suppliers		1,917,319		1,474,227
(-) Adjustment to present value		(28,100)		(21,590)
Supply chain finance		1,889,219		1,452,637

The Company has agreements with several financial institutions that allow the suppliers to anticipate their receivables. The suppliers may choose whether to participate and if so, with which institution. The anticipation allows the suppliers to better manage their cash flow needs. This flexibility allows the Company to intensify its commercial relations with the network of suppliers by potentially leveraging benefits such as preference for supply in case of restricted supply, better price conditions and/or more flexible payment terms, among others, without identifiable changes in other commercial conditions. The operations presented in this line item are the ones in which there were changes in the payment terms and prices negotiated with the suppliers.

On September 30, 2021, the discount rates applied to the supply chain finance transactions agreed between our suppliers and the financial institutions in the domestic market were set between 0.54% and 0.74% p.m. (0.38% to 0.47% p.m. on December 31, 2020).

On September 30, 2021, the discount rates applied to the supply chain finance transactions agreed between our suppliers and the financial institutions in the external market were set between 0.18% and 0.38% p.m. (0.18% to 0.40% p.m. on December 31, 2020).

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17. LEASES

The Company is lessee in several lease agreements for forest lands, offices, distribution centers, outgrowers, vehicles, among others. Some contracts have a renewal option for an additional period at the end of the agreement, established by contractual amendments. Automatic renewals or renewals for undetermined periods are not allowed.

The contract clauses mentioned, with respect to renewal, readjustment and purchase option, are contracted according to market practices. In addition, there are no clauses of contingent payments or restrictions on dividends distribution, payments of interest on shareholders’ equity or obtaining debt.

17.1. Right-of-use assets

The right-of-use assets as set forth below are part of the balances of property, plant and equipment and intangible assets (notes 12 and 13).

	Average rate (1)		12.31.20		Additions		Disposals		Transfers		Business combination (note 1.2)		Exchange rate variation		09.30.21
Cost
Land			48,661		3,761		(1,845)		89,060		-		3,361		142,998
Buildings			2,861,916		397,918		(48,583)		(89,060)		4,736		4,897		3,131,824
Machinery and equipment			112,593		98,353		(98,660)		-		3,346		364		115,996
Vehicles			344,918		46,309		(23,112)		-		925		6,622		375,662
Software			74,582		5,213		(64)		-		-		-		79,731
			3,442,670		551,554		(172,264)		-		9,007		15,244		3,846,211
Depreciation
Land	8.76%		(13,526)		(8,906)		995		(11,335)		-		(430)		(33,202)
Buildings	25.13%		(914,816)		(429,368)		37,712		11,335		-		(4,418)		(1,299,555)
Machinery and equipment	53.81%		(107,316)		(47,102)		98,415		-		-		(283)		(56,286)
Vehicles	27.86%		(101,495)		(76,969)		11,807		-		-		(3,357)		(170,014)
Software	42.22%		(33,048)		(21,216)		64		-		-		-		(54,200)
			(1,170,201)		(583,561)		148,993		-		-		(8,488)		(1,613,257)
			2,272,469		(32,007)		(23,271)		-		9,007		6,756		2,232,954

(1) Weighted average annual rate.

	Average rate (1)		12.31.19		Additions		Disposals	Transfers			Exchange rate variation		12.31.20
Cost
Land			22,790		5,900		(961)	20,751			181		48,661
Buildings			2,615,883		287,451		(86,557)	(2,487)			47,626		2,861,916
Machinery and equipment			115,173		5,518		(8,289)	-			191		112,593
Vehicles			207,443		165,699		(54,260)	-			26,036		344,918
Software			55,705		72,766		(35,625)	(18,264)			-		74,582
			3,016,994		537,334		(185,692)	-			74,034		3,442,670
Depreciation
Land	16.32%		(5,086)		(6,861)		813	(1,799)			(593)		(13,526)
Buildings	29.11%		(512,836)		(464,159)		85,042	(6,765)			(16,098)		(914,816)
Machinery and equipment	42.48%		(96,958)		(17,865)		7,610	-			(103)		(107,316)
Vehicles	26.39%		(57,357)		(71,768)		41,024	-			(13,394)		(101,495)
Software	45.21%		(44,815)		(32,422)		35,625	8,564			-		(33,048)
			(717,052)		(593,075)		170,114	-			(30,188)		(1,170,201)
			2,299,942		(55,741)		(15,578)	-			43,846		2,272,469

(1) Weighted average annual rate.

17.2. Lease liabilities

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Schedule of lease liabilities

	WAM (1)		12.31.20		Additions		Payments		Interest paid		Interest accrued		Disposals		Transfers		Business combination (note 1.2)		Exchange rate variation		09.30.21
Land	4.6		37,868		3,761		(5,256)		(6,360)		6,360		(970)		82,851		-		7,252		125,506
Buildings	1.9		2,195,407		397,918		(402,354)		(84,086)		133,023		(16,994)		(82,851)		6,557		(22,587)		2,124,033
Machinery and equipment	0.9		3,773		98,353		(45,352)		(2,783)		2,783		(34)		-		3,703		97		60,540
Vehicles	1.8		256,423		46,309		(74,416)		(13,893)		13,893		(1,574)		-		886		(9,387)		218,241
Software	1.5		43,210		5,213		(21,533)		(1,906)		1,906		-		-				-		26,890
			2,536,681		551,554		(548,911)		(109,028)		157,965		(19,572)		-		11,146		(24,625)		2,555,210
Current			383,162																		485,905
Non-current			2,153,519																		2,069,305

(1) Weighted average maturity in years.

	WAM (1)		12.31.19		Additions		Payments		Interest paid		Interest accrued		Disposals		Transfers		Exchange rate variation		12.31.20
Land	4.7		20,355		5,900		(5,819)		(4,716)		4,716		(1,729)		18,811		350		37,868
Buildings	3.4		2,227,026		310,204		(425,594)		(99,426)		170,763		(762)		(18,238)		31,434		2,195,407
Machinery and equipment	1.8		25,687		5,518		(26,776)		(13,285)		13,285		(755)		8		91		3,773
Vehicles	2.2		156,975		165,699		(64,674)		(15,231)		15,231		(14,155)		(581)		13,159		256,423
Software	1.6		1,137		72,767		(30,693)		(3,967)		3,966		-		-		-		43,210
			2,431,180		560,088		(553,556)		(136,625)		207,961		(17,401)		-		45,034		2,536,681
Current			376,628																383,162
Non-current			2,054,552																2,153,519

(1) Weighted average maturity in years.

17.3. Lease liabilities maturity schedule

The maturity schedule of the minimum required future payments are presented below:

			09.30.21
Current			485,905
Non-current			2,069,305
October to December 2022			132,751
2023			444,474
2024			326,767
2025			234,653
2026 onwards			930,660
			2,555,210

17.4. Incremental borrowing rate

The Company uses nominal incremental borrowing rates to measure its lease liabilities. The nominal and real interest rates are presented below:

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		09.30.21				12.31.20
Contract Terms		Nominal rate % p.a.		Real rate % p.a.		Nominal rate % p.a.		Real rate % p.a.
1 year		4.92%		0.43%		5.69%		1.05%
2 years		4.81%		0.49%		5.96%		2.61%
3 years		6.31%		2.14%		6.80%		2.53%
4 years		7.15%		2.90%		8.50%		4.56%
5 years		9.69%		4.85%		8.98%		4.40%
6 years		10.61%		5.15%		-		-
7 years		10.96%		5.74%		-		-
8 years		-		-		10.47%		5.71%
9 years		-		-		10.75%		5.97%
10 years		-		-		11.39%		6.64%
12 years		9.85%		5.55%		-		-
13 years		-		-		11.68%		7.38%
14 years		-		-		11.84%		7.13%
16 years		12.44%		6.70%		-		-
20 years		12.95%		7.07%		13.26%		9.00%

The nominal rates presented above as of September 30, 2021 refer to the incremental borrowing rates used in contracts recognized in the nine-month period ended on September 30, 2021 and the rates as of December 31, 2020 refer to the rates used in contracts recognized during the year ended on December 31, 2020.

17.5. Amounts recognized in the statement of income

The amounts directly recognized in the statement of income presented below relate to items exempt of recognition: low-value assets, short-term leases and leases with variable payments.

						2021
						Jul - Sep		Jan - Sep
Variable payments not included in the lease liabilities						74,078		226,488
Expenses related to short-term leases						42,833		134,928
Expenses related to low-value assets						1,432		2,887
Amounts recognized in the statement of income						118,343		364,303

18. SHARE-BASED PAYMENT

The terms of stock options and restricted shares plans granted to executives were disclosed in the financial statements for the year ended December 31, 2020 (note 19).

The breakdown of the outstanding granted restricted shares is set forth as follows:

Date				Quantity				Grant (1)
Grant		Vesting date		Shares granted		Outstanding shares		Fair value of the shares
10.01.18		10.01.21		2,311,394		867,956		21.44
06.01.19		06.01.22		674,296		186,424		30.61
07.01.19		07.01.22		1,141,353		267,909		30.61
09.16.19		10.01.22		68,605		20,580		30.61
06.01.20		06.01.23		3,571,736		2,163,272		21.28
07.01.21		07.01.24		2,883,737		2,764,913		28.58
				10,651,121		6,271,054

(1) Amounts expressed in Brazilian Reais.

The rollforward of the granted options and shares for the nine-month period ended on September 30, 2021, is presented as follows:

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Outstanding options/stocks as of December 31, 2020 (1)		7,873,348
Granted
Restricted stocks - July 2021		2,883,737
Exercised / Delivered:
Restricted stocks – grant of June, 2020		(457,939)
Restricted stocks – grant of September, 2019		(18,237)
Restricted stocks – grant of July, 2019		(113,957)
Restricted stocks – grant of June, 2019		(114,271)
Forfeiture (2) :
Restricted stocks – grant of July, 2021		(118,824)
Restricted stocks – grant of June, 2020		(838,436)
Restricted stocks - grant of July, 2019		(275,372)
Restricted stocks – grant of June, 2019		(113,582)
Restricted stocks - grant of October, 2018		(15,083)
Expired:
Stock options - grant of May, 2016		(1,145,330)
Stock options - grant of April, 2016		(1,275,000)
Outstanding options/stocks as of September 30, 2021		6,271,054

(1) Includes stock options outstanding on December 31, 2020, as presented in the financial statements for the year of 2020.

(2) The forfeitures are related to the resignation of eligible executive before the end of the vesting period.

The Company has registered under shareholders’ equity, the fair value of share-based compensation plans in the amount of R$213,825 (R$223,191 as of December 31, 2020) and in the amount of R$17,397 under non-current liabilities (R$21,521 as of December 31, 2020). In the statement of income for the nine-month ended September 30, 2021 the amount recognized as expense was R$40,074 (R$43,263 in the same period of the previous year), and during the three-month period ended on September 30, 2021 the amount recognized as expense was R$12,749 (expense of R$21,239 in the same period of the previous year).  

19. EMPLOYEES BENEFITS PLANS

The Company offers pension and other post-employment plans to the employees. The characteristics of such benefits were disclosed in the annual financial statements for the year ended on December 31, 2020 (note 20) and have not been changed during the following periods. The actuarial liabilities are presented below:

Schedule of quantitative sensitivity analysis regarding relevant assumptions of defined benefit plan

					Liabilities
					09.30.21		12.31.20
Medical assistance					196,283		185,802
F.G.T.S. Penalty (1)					294,012		282,229
Award for length of service					113,900		108,908
Other					217,979		199,616
					822,174		776,555
Current					125,312		125,230
Non-current					696,862		651,325

(1) FGTS – Government Severance Indemnity Fund for Employees

The Company estimated costs for pension and post-employment plans for the year of 2021, according to an appraisal report prepared in 2020 by an actuarial expert and recorded in the condensed consolidated statement of income (loss) for nine-month ended September 30, 2021 against other comprehensive income a gain of R$11,729, net of taxes (R$20,134 in the same period of the previous year) and for the three-month period ended on September 30, 2021 a gain of R$3,694, net of taxes (R$7,170 in the same period of the previous year). 

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20. PROVISION FOR TAX, CIVIL AND LABOR RISKS

The Company and its subsidiaries are involved in certain legal matters arising in the normal course of business, which include civil, tax, social security, labor, commercial and other processes.

Company’s Management believes that, based on the elements existing at the base date of this condensed consolidated interim financial information, the provision for tax, civil, labor, commercial and other risks, is sufficient to cover eventual losses with administrative and legal proceedings, as set forth below.

20.1. Contingencies with probable losses

The rollforward of the provisions for tax, labor, civil, commercial and other risks classified as with probable loss, and contingent liabilities is presented below:

	Tax				Labor				Civil, commercial and other				Contingent liabilities (1)				Total
	09.30.21		12.31.20		09.30.21		12.31.20		09.30.21		12.31.20		09.30.21		12.31.20		09.30.21		12.31.20
Beginning balance	427,302		583,464		634,706		603,074		343,530		307,177		297,182		300,654		1,702,720		1,794,369
Additions	157,624		103,773		204,697		435,723		52,977		52,961		-		-		415,298		592,457
Business combination (note 1.2)	2,553		-		1,972		-		4,725		-		-		-		9,250		-
Reversals	(67,752)		(246,499)		(110,114)		(250,029)		(54,475)		(34,556)		(194,845)		(3,464)		(427,186)		(534,548)
Payments	(144,276)		(70,699)		(204,947)		(298,599)		(17,335)		(29,889)		-		-		(366,558)		(399,187)
Interest	52,451		57,275		91,194		144,516		81,942		47,818		-		-		225,587		249,609
Exchange rate variation	(16)		(12)		(466)		21		(75)		19		(13)		(8)		(570)		20
Ending balance	427,886		427,302		617,042		634,706		411,289		343,530		102,324		297,182		1,558,541		1,702,720
Current																	1,050,188		865,338
Non-current																	508,353		837,382

(1) Contingent liabilities recognized at fair value as of the acquisition date, arising from the business combination with Sadia. The reversals in the period refer mainly to the closing of the processes related to ICMS credits in the context of the “Guerra Fiscal” (note 20.2.1 of the 2020 financial statements).

20.2. Contingencies with possible losses

The Company is involved in contingencies for which losses are possible, in accordance with the assessment prepared by Management with support from legal advisors. Such contingencies have the same characteristics of those disclosed in the 2020 financial statements and on September 30, 2021 had balances of, R$1,619,032 (R$1,523,987 on December 31, 2020) for civil risks, R$315,579 (R$197,097 on December 31, 2020) for labor risks and R$13,187,530 (R$12,536,528 on December 31, 2020) for tax risks, for which only those resulting from the business combination with Sadia have a provision, recorded at the fair value estimated on the date of the business combination, in the amount of R$102,324 (R$297,182 as of December 31, 2020).

21. EQUITY

21.1. Capital stock

On September 30, 2021, the subscribed and paid capital of the Company was R$12,553,418, which is composed of 812,473,246 common book-entry shares with no par value. The value of the capital stock is net of the public offering expenses of R$92,947, made on July 22, 2009.

The Company is authorized to increase the capital stock, irrespective of amendment to the bylaws, up to the limit of 1,000,000,000 (one billion) common book-entry shares with no par value.

21.1.1. Breakdown of capital stock by nature

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Schedule of breakdown of capital stock by nature

	09.30.21		12.31.20
Common shares	812,473,246		812,473,246
Treasury shares	(4,061,680)		(4,766,084)
Outstanding shares	808,411,566		807,707,162

21.1.2. Rollforward of outstanding shares

On September 30, 2021, the quantity of outstanding of shares was 808,411,566, in the period were delivered of 704,404 shares, in accordance with Restricted Share plan of Company.

Quantity of outstanding of shares
		09.30.21		12.31.20
Shares at the beginning of the period		807,707,162		811,759,800
Purchase of treasury shares		-		(4,836,000)
Delivery of restricted shares		704,404		783,362
Shares at the end of the period		808,411,566		807,707,162

21.2. Capital reserves and Other equity transactions

For better presentation of the transactions, the balance priorly presented in Capital reserves was split between Capital reserves and Other equity transactions. In the current presentation, Capital reserves contemplate only the balances related with results on the sale and exchange of stocks, in compatibility with the Law 6.404/1976 (“Lei das S.A”) - Brazilian Corporate Law.

		09.30.21		12.31.20
Capital reserves		141,834		141,834
Other equity transactions		(80,313)		246
Share-based payments		213,825		214,711
Acquisition of non-controlling entities		(293,918)		(214,245)
Capital transactions with controlled entities		(220)		(220)
		61,521		142,080

21.3. Treasury shares

The Company has 4,061,680 shares held in treasury, with an average cost of R$26.00 (twenty-six Brazilian Reais) per share, and corresponding market value of R$110,031, in the period were delivered of 704,404 shares, in accordance with Restricted Share plan of Company.

Quantity of outstanding of shares
		09.30.21		12.31.20
Shares at the beggining of the period		4,766,084		713,446
Purchase of treasury shares		-		4,836,000
Delivery of restricted shares		(704,404)		(783,362)
Shares at the end of the period		4,061,680		4,766,084

On September 30, 2021, the Company’s Board of Directors approved the Company’s share buyback program up to the limit of 3,696,858 (three million, six hundred and ninety-six thousand, eight hundred and fifty-eight) common shares, in a 18-month term. The goal of the program is to comply with the obligations assumed by the Company under the Restricted Stock Plan.

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In October 2021, the Company purchased 1,232,300 (one million, two hundred and thirty-two thousand, three hundred) common shares at the cost of R$27,722.

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22. EARNINGS (LOSS) PER SHARE

Schedule of earnings per share

	Continued operations
			2021				2020
	Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Basic numerator
Net earnings (loss) for the period attributable to controlling shareholders	(275,600)		(454,014)		216,791		609,668
Basic denominator
Common shares	812,473,246		812,473,246		812,473,246		812,473,246
Weighted average number of outstanding shares - basic (except treasury shares)	807,709,278		808,013,781		807,406,368		809,583,921
Net earnings (loss) per share basic - R$	(0.34)		(0.56)		0.27		0.75
Diluted numerator
Net earnings (loss) for the period attributable to controlling shareholders	(275,600)		(454,014)		216,791		609,668
Diluted denominator
Weighted average number of outstanding shares - basic (except treasury shares)	807,709,278		808,013,781		807,406,368		809,583,921
Number of potential shares	-		-		58,332		58,332
Weighted average number of outstanding shares - diluted	807,709,278		808,013,781		807,464,700		809,642,253
Net earnings (loss) per share diluted - R$	(0.34)		(0.56)		0.27		0.75

	Discontinued operations				Continued and discontinued operations
			2021				2021
	Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Basic numerator
Net earnings (loss) for the exercise attributable to controlling shareholders	(6,516)		(47,802)		(282,116)		(501,816)
Basic denominator
Common shares	812,473,246		812,473,246		812,473,246		812,473,246
Weighted average number of outstanding shares - basic (except treasury shares)	807,709,278		808,013,781		807,709,278		808,013,781
Net earnings (loss) per share basic - R$	(0.01)		(0.06)		(0.35)		(0.62)
Diluted numerator
Net earnings (loss) for the exercise attributable to controlling shareholders	(6,516)		(47,802)		(282,116)		(501,816)
Diluted denominator
Weighted average number of outstanding shares - basic (except treasury shares)	807,709,278		808,013,781		807,709,278		808,013,781
Number of potential shares	-		-		-		-
Weighted average number of outstanding shares - diluted	807,709,278		808,013,781		807,709,278		808,013,781
Net earnings (loss) per share diluted - R$	(0.01)		(0.06)		(0.35)		(0.62)

For the year ended December 31, 2020, the Income (loss) from discontinued operations was null.

23. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

23.1. Overview

In the ordinary course of business, the Company is exposed to credit, liquidity and market risks, which are actively managed in compliance with the Financial Risk Management Policy (“Risk Policy”) and internal guidelines and strategic documents subject to such policy, executing the formal designation of its hedge accounting relations, as disclosed in the financial statements for the year ended on December 31, 2020.

23.2. Credit risk management

The Company is exposed to the credit risk related to the financial assets held: trade and non-trade accounts receivable, marketable securities, derivative instruments and cash and equivalents. The Company’s credit risk exposure can be assessed in notes 4, 5 and 6.

On September 30, 2021, the Company held financial investments over R$100,000 at the following financial institutions: Banco Bradesco, Banco do Brasil, Banco BTG Pactual, Banco Itaú, Banco Safra, Banco Santander, Banco XP, Caixa Econômica Federal, Citibank, HSBC, J.P. Morgan Chase Bank, T.Garanti Bankasi A.Ş. and Vakiflar Bankasi.

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-44

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The Company also held derivative contracts with the following financial institutions: Banco Bradesco, Banco do Brasil, Banco Itaú, Banco Santander, Banco Votorantim, Bank of America Merrill Lynch, Banco BNP Paribas, Citibank, Goldman Sachs, J.P. Morgan Chase Bank, Morgan Stanley, Rabobank, T.Garanti Bankasi A.Ş. and Banco XP.

23.3. Capital management and liquidity risk

On September 30, 2021, the long-term consolidated gross debt represented 87.51% (93.66% as of December 31, 2020) of the total gross indebtedness, which has an average term higher than nine years.

The Company monitors the gross debt and net debt as set forth below:

	09.30.21						12.31.20
	Current		Non-current		Total		Total
Foreign currency loans and borrowings	(2,334,507)		(13,931,707)		(16,266,214)		(15,739,134)
Local currency loans and borrowings	(526,743)		(7,385,645)		(7,912,388)		(6,665,292)
Derivative financial liabilities	(186,147)		(36,077)		(222,224)		(385,696)
Gross debt	(3,047,397)		(21,353,429)		(24,400,826)		(22,790,122)
Marketable securities and cash and cash equivalents	7,233,026		375,906		7,608,932		8,235,360
Derivative financial assets	83,144		2,139		85,283		377,990
Restricted cash	24,529		1		24,530		24,358
Net debt					(16,682,081)		(14,152,414)

The table below summarizes the significant commitments and contractual obligations that may impact the Company’s liquidity:

	09.30.21
	Book value		Contractual cash flow		Up to 12 months		Oct - Dec 2022		2023		2024		2025		2026 onwards
Non derivative financial liabilities
Loans and borrowings	24,178,602		39,715,036		3,441,569		530,504		3,948,651		3,011,583		1,812,210		26,970,519
Principal			26,996,059		2,226,146		400,000		2,839,213		2,054,081		907,058		18,569,561
Interest			12,718,977		1,215,423		130,504		1,109,438		957,502		905,152		8,400,958
Trade accounts payable	11,089,196		11,195,643		11,183,638		3,272		5,778		2,849		106		-
Supply chain finance	1,889,219		1,917,319		1,917,319		-		-		-		-		-
Lease liabilities	2,555,210		3,214,065		519,189		144,233		515,998		405,335		311,068		1,318,242
Derivative financial liabilities
Financial instruments designated as cash flow hedge
Interest rate derivatives	36,077		36,077		-		-		-		-		-		36,077
Currency derivatives	82,654		82,654		82,654		-		-		-		-		-
Commodities derivatives	94,094		94,094		94,094		-		-		-		-		-
Financial instruments not designated as cash flow hedge
Currency derivatives	9,399		9,399		9,399		-		-		-		-		-

The Company does not expect that the cash outflows to fulfill the obligations shown above will be significantly influenced by factors unrelated to its best interests, or substantially modified outside the normal course of business.

23.4. Market risk management

23.4.1. Interest rate risk

The indebtedness is essentially linked to fixed coupon (R$, USD, EUR e TRY), Interbank Deposit Certificate (“CDI”), Broad Consumer Price Index (“IPCA”) and London Interbank Offered Rate (“LIBOR”). In situations of adverse market changes that result in an increase in these rates, the cost of floating-rate debt rises and on the other hand, the cost of fixed-rate debt decreases in relative terms.

Regarding the marketable securities, the Company holds, mainly, instruments indexed by the CDI for investments in Brazil and fixed coupon in USD for investments in the foreign market.

The Company’s exposure to interest rates can be assessed in notes 5 and 14.

The derivative financial instruments used to hedge the exposure to interest rates as of September 30, 2021 are presented in the table below:

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-45

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09.30.21

Fair value (R$)

Fair value hedge - Derivative instruments

Hedged Object

Maturity

Asset

Liability

Notional

Instrument

Object (1)

Interest rate swap

Debenture - 2nd Issue - 1st series - IPCA + 5.30% p.a

3rd Qtr. 2027

IPCA + 5.30% p.a

CDI + 2.16% p.a.

705,000

BRL

(2,351)

27,316

Interest rate swap

Debenture - 2nd Issue - 2nd series - IPCA + 5.60% p.a

3rd Qtr. 2030

IPCA + 5.60% p.a

CDI + 2.32% p.a.

1,495,000

BRL

(31,528)

71,026

Interest rate swap

Debenture - 3rd Issue - single series - IPCA + 4.78% p.a

2nd Qtr. 2031

IPCA + 4.78% p.a

CDI + 0.60% p.a.

200,000

BRL

(59)

(1,376)

(33,938)

96,966

(1) Corresponds to the accumulated amount of fair value hedge adjustments on the hedged items, included in the carrying amount of the debentures.

23.4.2. Foreign exchange risk

This risk is the one that may cause unexpected losses to the Company resulting from volatility of the FX rates, reducing its assets and revenues, or increasing its liabilities and costs. The Company’s exposure is managed in three dimensions: statement of financial position exposure, operating income exposure and investments exposure.

i. Statement of financial position exposure

Assets and liabilities denominated in foreign currency for which the exchange variations are recognized in the Financial Results are as follows, summarized in Brazilian Reais:

		09.30.21		12.31.20
Cash and cash equivalents		1,562,136		2,855,979
Trade accounts receivable		6,567,534		5,765,753
Trade accounts payable		(1,144,743)		(859,790)
Loans and borrowings		(15,274,760)		(14,947,793)
Other assets and liabilities, net		12,934		225,694
Exposure of assets and liabilities in foreign currencies		(8,276,899)		(6,960,157)
Derivative financial instruments (hedge)		7,764,347		6,849,947
Exposure in result, net		(512,552)		(110,210)

The net P&L exposure is mainly composed of the following currencies:

Net P&L Exposure		09.30.21		12.31.20
Argentinian Peso (ARS)		(5,804)		(5,310)
Angolan kwanza (AOA)		263,009		-
Euros (EUR)		(57,530)		112,672
Yen (JPY)		82,372		29,976
Turkish Liras (TRY)		(241,033)		178,906
U.S. Dollars (USD)		(553,566)		(426,454)
Total		(512,552)		(110,210)

The Company is exposed to other currencies, although they have been grouped in the currencies above due to its high correlation or for not being individually significant.

The derivative financial instruments acquired to hedge the foreign currency statement of financial position exposure on September 30, 2021 are not designated as hedge accounting and are set forth below:

09.30.21

Derivative instruments not designated

Asset

Liability

Maturity

Notional

Exercise rate

Fair value (R$)

Non-deliverable forward

EUR

BRL

4th Qtr. 2021

EUR

265,000

6.4336

(8,522)

Non-deliverable forward

USD

BRL

4th Qtr. 2021

USD

715,000

5.4864

12,727

Futures - B3

USD

BRL

4th Qtr. 2021

USD

358,000

5.4672

6,462

Currency swap

USD + 1.29% p.a.

CDI + 0.80% p.a.

1st Qtr. 2022

USD

47,583

-

8,450

Non-deliverable forward

EUR

JPY

4th Qtr. 2021

EUR

19,230

130.0080

(877)

Non-deliverable forward

USD

EUR

4th Qtr. 2021

EUR

34,133

1.1719

2,225

Total

20,465

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-46

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ii. Operating income exposure

The derivative and non-derivative financial instruments designated as cash flow hedges for foreing exchange operating income exposure on September 30, 2021 are set forth below:

09.30.21

Cash flow hedge - Derivative instruments

Hedged object

Asset

Liability

Maturity

Notional

Designation rate

Fair value

Non-deliverable forward

USD Exports

BRL

USD

4th Qtr. 2021

USD

313,000

5.3157

(48,724)

Non-deliverable forward

USD Exports

BRL

USD

1st Qtr. 2022

USD

63,000

5.4348

(8,220)

Non-deliverable forward

USD Exports

BRL

USD

2nd Qtr. 2022

USD

5,000

5.5782

(365)

Collar

USD Exports

BRL

USD

4th Qtr. 2021

USD

44,000

5.5772

3,204

Collar

USD Exports

BRL

USD

1st Qtr. 2022

USD

30,000

5.7162

1,869

Collar

USD Exports

BRL

USD

2nd Qtr. 2022

USD

10,000

5.7125

(187)

(52,423)

09.30.21

Cash flow hedge - Non-derivative instruments

Hedged object

Liability

Maturity

Notional

Designation rate

Fair value (1)

Bond BRF SA BRFSBZ 5 7/8 (2)

USD Exports

USD

2nd Qtr. 2022

USD

70,928

2.0213

(426,732)

Bond BRF SA BRFSBZ 3.95

USD Exports

USD

2nd Qtr. 2023

USD

150,000

2.0387

(510,105)

(936,837)

(1) Corresponds to the effective portion of the hedge result accumulated in Other Comprehensive Income.

(2) For this instrument, the initial designation was of USD150,000, however there were repurchases with corresponding revocation of the designation in the amounts of USD31,338 at the rate of 3.2408, USD9,350 at the rate of 4.1827, USD27,190 at the rate of 5.1889 e USD11,194 at the rate of 5.5714. The accumulated exchange rate variation of the revoked portions is fixed and reserved in Other Comprehensive Income until the recognition of the hedge object in the second quarter of 2022.

iii. Investments exposure

The Company holds investments abroad in functional currencies different than the Brazilian Real, which generate currency exposure that affects directly the Company’s Equity, in Other Comprehensive Income.

The non-derivative financial instruments designated as net investment hedge instruments on September 30, 2021 are set forth below:

09.30.21

Net investment hedge - Non-derivative instruments

Object (Investment)

Liability

Maturity

Notional

Rate

Fair value (1)

Bond - BRF SA BRFSBZ 4.35

Federal Foods LLC

USD

3rd Qtr. 2026

USD

75,673

3.7649

(127,395)

Bond - BRF SA BRFSBZ 4.35

BRF Al Yasra Food

USD

3rd Qtr. 2026

USD

108,757

3.7649

(169,128)

Bond - BRF SA BRFSBZ 4.35

Al Khan Foodstuff LLC

USD

3rd Qtr. 2026

USD

65,570

3.7649

(109,230)

(405,753)

(1) Corresponds to the effective portion of the hedge result accumulated in Other Comprehensive Income.

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-47

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23.4.3. Commodities price risk

The financial instruments designated as cash flow hedges and fair value hedges for the commodities price exposure on September 30, 2021 are set forth below:

09.30.21

Cash flow hedge - Derivative instruments

Hedged object

Index

Maturity

Quantity

Exercise price (1)

Fair value

Non-deliverable forward - buy

Soybean meal purchase - floating price

Soybean meal - CBOT

4th Qtr. 2021

32,977

ton

417.29

(9,400)

Non-deliverable forward - buy

Soybean meal purchase - floating price

Soybean meal - CBOT

1st Qtr. 2022

85,963

ton

412.66

(21,089)

Non-deliverable forward - buy

Soybean meal purchase - floating price

Soybean meal - CBOT

2nd Qtr. 2022

184,877

ton

395.96

(22,888)

Non-deliverable forward - buy

Soybean meal purchase - floating price

Soybean meal - CBOT

3rd Qtr. 2022

30,946

ton

387.86

(1,943)

Collar - buy

Soybean meal purchase - floating price

Soybean meal - CBOT

4th Qtr. 2021

9,989

ton

421.11

(2,156)

Collar - buy

Soybean purchase - floating price

Soybean - CBOT

4th Qtr. 2021

19,999

ton

458.84

172

Non-deliverable forward - buy

Corn purchase - floating price

Corn - B3

3rd Qtr. 2022

2,025

ton

1,333.16

(33)

Collar - buy

Corn purchase - floating price

Corn - B3

4th Qtr. 2021

13,230

ton

1,587.07

126

Collar - buy

Corn purchase - floating price

Corn - B3

1st Qtr. 2022

17,037

ton

1,683.33

(303)

Collar - buy

Corn purchase - floating price

Corn - B3

2nd Qtr. 2022

7,992

ton

1,616.67

(97)

Collar - buy

Soybean oil purchase - floating price

Soybean oil - CBOT

4th Qtr. 2021

2,994

ton

794.77

7,069

(50,542)

(1) Base price of each commodity in USD/ton, except for Corn – B3 denominated in R$/ton.

09.30.21

Cash flow hedge - Derivative instruments

Protection object

Assets

Liabilities

Maturity

Notional

Exercise price

Fair value (R$)

Non-deliverable forward

Cost in USD

USD

TRY

4th Qtr. 2021

USD

7,098

8.8251

998

998

09.30.21

Fair value hedge - Derivative instruments

Hedged object

Index

Maturity

Quantity

Exercise price (1)

Fair value

Non-deliverable forward - sell

Soybean purchase - fixed price

Soybean - CBOT

1st Qtr. 2022

15,000

ton

503.65

2,956

Non-deliverable forward - sell

Corn purchase - fixed price

Corn - CBOT

4th Qtr. 2021

179,299

ton

202.24

(8,839)

Non-deliverable forward - sell

Corn purchase - fixed price

Corn - CBOT

1st Qtr. 2022

63,077

ton

200.41

(4,783)

Non-deliverable forward - sell

Corn purchase - fixed price

Corn - CBOT

2nd Qtr. 2022

170,790

ton

216.20

59

Non-deliverable forward - sell

Corn purchase - fixed price

Corn - CBOT

3rd Qtr. 2022

39,995

ton

184.67

(5,034)

Corn future - sell

Corn purchase - fixed price

Corn - B3

4th Qtr. 2021

7,803

ton

1,562.51

186

Corn future - sell

Corn purchase - fixed price

Corn - B3

1st Qtr. 2022

104,571

ton

1,631.40

2,488

Corn future - sell

Corn purchase - fixed price

Corn - B3

2nd Qtr. 2022

9,882

ton

1,537.49

124

Corn future - sell

Corn purchase - fixed price

Corn - B3

3rd Qtr. 2022

176,985

ton

1,339.50

1,459

Corn future - sell

Corn purchase - fixed price

Corn - B3

4th Qtr. 2022

14,985

ton

1,350.41

-

Collar - sell

Corn purchase - fixed price

Corn - B3

4th Qtr. 2021

62,910

ton

1,649.32

4,350

Collar - sell

Corn purchase - fixed price

Corn - B3

1st Qtr. 2022

25,380

ton

1,567.91

248

Put - Buy

Corn purchase - fixed price

Corn - B3

4th Qtr. 2021

5,994

ton

1,616.67

583

(6,203)

(1) Base price of each commodity in USD/ton, except for Corn – B3 denominated in R$/ton.

09.30.21

Fair value hedge - Derivative instruments

Protection object

Assets

Liabilities

Maturity

Notional

Exercise price

Fair value

Non-deliverable forward

Cost in USD

BRL

USD

4th Qtr. 2021

USD

36,262

5.3508

(5,001)

Non-deliverable forward

Cost in USD

BRL

USD

1st Qtr. 2022

USD

20,196

5.3666

(4,335)

Non-deliverable forward

Cost in USD

BRL

USD

2nd Qtr. 2022

USD

36,924

5.6119

(4,575)

Non-deliverable forward

Cost in USD

BRL

USD

3rd Qtr. 2022

USD

7,386

5.6278

(1,387)

(15,298)

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-48

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23.5. Effects of hedge instruments on financial information

The effects of financial instruments for hedging exchange rate, commodities price and interest rates in the condensed consolidated statement of income (loss) for the period, in Other Comprehensive Income and in the condensed consolidated statement of financial position are set forth below:

Income for the period
Jul - Sep 2021		Note		Exposure		Hedge accounting		Foreign Exchange		Commodities		Interest Rate		Total
Net Sales								12,349,193		-		-		12,349,193
Derivatives result				Operating Results		Cash flow		40,792		-		-		40,792
Net Revenue		25						12,389,985		-		-		12,389,985
Cost of Sales								-		(9,757,320)		-		(9,757,320)
Derivatives result				Operating Results		Cash flow / Fair value		-		(7,983)		-		(7,983)
Cost of Sales								-		(9,765,303)		-		(9,765,303)
Interests on loans and borrowings								-		-		(361,115)		(361,115)
Interest Rate Derivatives result				Interest expenses		Fair value		-		-		(40,065)		(40,065)
Foreign Exchange variation on assets and liabilities								(625,672)		-		-		(625,672)
Foreign Exchange Derivatives result				Financial Position		Not designated		594,162		-		-		594,162
Effects on Financial Result		27						(31,510)		-		(401,180)		(432,690)
Other Comprehensive Income
Jul - Sep 2021				Exposure		Hedge accounting		Foreign Exchange		Commodities		Interest Rate		Total
Derivative Instruments - current				Operating Results		Cash flow		(183,860)		(169,440)		-		(353,300)
Non-derivative Instruments – current				Operating Results		Cash flow		(31,010)		-		-		(31,010)
Non-derivative Instruments – non-current				Operating Results		Cash flow		(65,580)		-		-		(65,580)
Non-derivative Instruments - non-current				Foreign investments		Net investment		(106,955)		-		-		(106,955)
Other Comprehensive Income (1)								(387,405)		(169,440)		-		(556,845)
Income for the period
Jan - Sep 2021		Note		Exposure		Hedge accounting		Foreign Exchange		Commodities		Interest Rate		Total
Net Sales								34,539,353		-		-		34,539,353
Derivatives result				Operating Results		Cash flow		79,510		-		-		79,510
Net Revenue		25						34,618,863		-		-		34,618,863
Cost of Sales								-		(27,388,645)		-		(27,388,645)
Derivatives result				Operating Results		Cash flow / Fair value		-		(184,594)		-		(184,594)
Cost of Sales								-		(27,573,239)		-		(27,573,239)
Interests on loans and borrowings								-		-		(1,216,925)		(1,216,925)
Interest Rate Derivatives result				Interest expenses		Fair value		-		-		(35,025)		(35,025)
Foreign Exchange variation on assets and liabilities								(359,457)		-		-		(359,457)
Foreign Exchange Derivatives result				Financial Position		Not designated		178,101		-		-		178,101
Effects on Financial Result		27						(181,356)		-		(1,251,950)		(1,433,306)
Other Comprehensive Income
Jan - Sep 2021				Exposure		Hedge accounting		Foreign Exchange		Commodities		Interest Rate		Total
Derivative Instruments - current				Operating Results		Cash flow		(100,366)		(209,373)		-		(309,739)
Non-derivative Instruments – current				Operating Results		Cash flow		(17,214)		-		-		(17,214)
Non-derivative Instruments – non-current				Operating Results		Cash flow		(36,405)		-		-		(36,405)
Non-derivative Instruments - non-current				Foreign investments		Net investment		(61,079)		-		-		(61,079)
Other Comprehensive Income (1)								(215,064)		(209,373)		-		(424,437)

(1) All effects are presented gross of taxes.

BRF S.A. | CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION – September 30, 2021  F-49

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Statement of financial position
09.30.21		Note		Exposure		Hedge accounting		Foreign Exchange		Commodities		Interest Rate		Total
Designated derivatives				Operating Results		Cash flow / Fair value		(66,723)		(56,745)		(33,938)		(157,406)
Not designated derivatives				Financial Position		Not designated		20,465		-		-		20,465
Asset / (Liability) net								(46,258)		(56,745)		(33,938)		(136,941)
Derivative Instruments - current (2)				Operating Results		Cash flow		(52,423)		(38,067)		-		(90,490)
Non-derivative instruments – current				Operating Results		Cash flow		(426,732)		-		-		(426,732)
Non-derivative instruments – non-current				Operating Results		Cash flow		(510,105)		-		-		(510,105)
Non-derivative Instruments - non-current				Foreign investments		Net investment		(405,753)		-		-		(405,753)
Other Comprehensive Income (1)								(1,395,013)		(38,067)		-		(1,433,080)
Derivatives result				Operating Results		Cash flow / Fair value		-		538,512		-		538,512
Inventories		7						-		538,512		-		538,512

(1) All effects are presented gross of taxes.

(2) Includes R$(2,192) related to the time value of the foreign exchange option contracts, and R$(234) related to the time value of the commodity options contracts.

Statement of financial position
12.31.20		Note		Exposure		Hedge accounting		Foreign Exchange		Commodities		Interest Rate		Total
Designated derivatives				Operating Results		Cash flow / Fair value		95,558		(144,057)		-		(48,499)
Not designated derivatives				Financial Position		Not designated		55,442		-		(14,649)		40,793
Asset / (Liability) net								151,000		(144,057)		(14,649)		(7,706)
Derivative Instruments - current				Operating Results		Cash flow		47,942		171,306		-		219,248
Non-derivative instruments – non-current				Operating Results		Cash flow		(883,218)		-		-		(883,218)
Non-derivative Instruments - non-current				Foreign investments		Net investment		(344,674)		-		-		(344,674)
Other Comprehensive Income								(1,179,950)		171,306		-		(1,008,644)
Derivatives result				Operating Results		Cash flow / Fair value		-		442,398		-		442,398
Inventories		7						-		442,398		-		442,398

In the statement of cash flows, the effect of the derivative financial instruments designated as hedge accounting is presented in the line item in which the hedged object is recorded. For the instruments not designated, the effects are presented in the Derivative Financial Instruments line item.

Summarized financial position of derivative financial instruments:

					09.30.21		12.31.20
Assets
Designated as hedge accounting
Currency derivatives					15,931		177,208
Commodities derivatives					37,349		125,304
Interest rate derivatives					2,139		-
Not designated as hedge accounting
Currency derivatives					29,864		75,478
					85,283		377,990
Current assets					83,144		377,756
Non-current assets					2,139		234
Liabilities
Designated as hedge accounting
Currency derivatives					(82,654)		(81,650)
Commodities derivatives					(94,094)		(269,361)
Interest rate derivatives					(36,077)		-
Not designated as hedge accounting
Currency derivatives					(9,399)		(20,036)
Interest rate derivatives					-		(14,649)
					(222,224)		(385,696)
Current liabilities					(186,147)		(384,969)
Non-current liabilities					(36,077)		(727)

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23.6. Sensitivity analysis

The Management believes that the most relevant risks that may affect the Company’s results are the volatility of commodities prices and foreign exchange rates. Currently the fluctuation of the interest rates does not affect significantly the Company’s results since Management has chosen to keep at fixed rates a considerable portion of its debts.

The amounts below represent the possible impacts (incremental results) of the hedging instruments and their respective hedged positions, considering situations of increase and decrease in the selected risk factors.

The information used in the preparation of the analysis is based on the position as of September 30, 2021, which has been described in the items above. The future results may diverge significantly of the estimated values if the reality presents different than the assumptions used. Positive values indicate gains and negative values indicate losses.

		Scenario
Exchange rate - Balance		Base		- 50%		- 25%		- 10%		+ 10%		+ 25%		+ 50%
USD		5.4394		2.7197		4.0796		4.8955		5.9833		6.7993		8.1591
Monetary Assets and Liabilities				3,433,220		1,716,610		686,644		(686,644)		(1,716,610)		(3,433,220)
Derivative Instruments - Not designated				(3,156,437)		(1,578,218)		(631,287)		631,287		1,578,218		3,156,437
Net effect				276,783		138,392		55,357		(55,357)		(138,392)		(276,783)
EUR		6.2983		3.1492		4.7237		5.6685		6.9281		7.8729		9.4475
Monetary Assets and Liabilities				820,571		410,286		164,114		(164,114)		(410,286)		(820,571)
Derivative Instruments - Not designated				(786,712)		(393,356)		(157,342)		157,342		393,356		786,712
Net effect				33,859		16,930		6,772		(6,772)		(16,930)		(33,859)
JPY		0.0488		0.0244		0.0366		0.0439		0.0537		0.0610		0.0732
Monetary Assets and Liabilities				(102,161)		(51,080)		(20,432)		20,432		51,080		102,161
Derivative Instruments - Not designated				60,975		30,488		12,195		(12,195)		(30,488)		(60,975)
Net effect				(41,186)		(20,592)		(8,237)		8,237		20,592		41,186
TRY		0.6124		0.3062		0.4593		0.5512		0.6736		0.7655		0.9186
Monetary Assets and Liabilities				120,516		60,258		24,103		(24,103)		(60,258)		(120,516)
Net effect				120,516		60,258		24,103		(24,103)		(60,258)		(120,516)
AOA		0.0091		0.0045		0.0068		0.0082		0.0100		0.0113		0.0136
Monetary Assets and Liabilities				(131,504)		(65,752)		(26,301)		26,301		65,752		131,504
Net effect				(131,504)		(65,752)		(26,301)		26,301		65,752		131,504

		Scenario
Exchange rate - Operating results		Base		- 50%		- 25%		- 10%		+ 10%		+ 25%		+ 50%
USD		5.4394		2.7197		4.0796		4.8955		5.9833		6.7993		8.1591
Revenue in USD				(1,865,518)		(932,759)		(373,104)		373,104		932,759		1,865,518
NDF				1,036,206		518,103		207,241		(207,241)		(518,103)		(1,036,206)
Collar				222,657		108,429		39,893		(23,342)		(88,388)		(202,615)
Loans - Designated				600,858		300,429		120,172		(120,172)		(300,429)		(600,858)
Net effect				(5,797)		(5,798)		(5,798)		22,349		25,839		25,839

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		Scenario
Exchange rate - Operating results		Base		- 50%		- 25%		- 10%		+ 10%		+ 25%		+ 50%
USD		5.4394		2.7197		4.0796		4.8955		5.9833		6.7993		8.1591
Cost of Sales				(274,059)		(137,030)		(54,812)		54,812		137,030		274,059
NDF				274,059		137,030		54,812		(54,812)		(137,030)		(274,059)
Net effect				-		-		-		-		-		-
		Scenario
Operating results - Commodities		Base (1)		- 50%		- 25%		- 10%		+ 10%		+ 25%		+ 50%
Soy Grain - CBOT		464		232		348		418		510		580		696
Cost of Sales				1,160		580		232		(232)		(580)		(1,160)
Collar				(4,139)		(1,832)		(447)		554		1,938		4,246
NDF				3,505		1,753		701		(701)		(1,753)		(3,505)
Net effect				526		501		486		(379)		(395)		(419)
Soybean Meal - CBOT		371		185		278		334		408		464		556
Cost of Sales				63,940		31,970		12,788		(12,788)		(31,970)		(63,940)
Collar				(1,810)		(905)		(362)		238		537		1,369
NDF				(62,130)		(31,065)		(12,426)		12,426		31,065		62,130
Net effect				-		-		-		(124)		(368)		(441)
Soybean Oil - CBOT		1,294		647		970		1,165		1,423		1,617		1,941
Cost of Sales				1,937		968		387		(387)		(968)		(1,937)
Collar				(1,547)		(968)		(387)		387		968		1,937
Net effect				390		-		-		-		-		-
Corn - CBOT		213		107		160		192		235		267		320
Cost of Sales				(48,318)		(24,159)		(9,664)		9,664		24,159		48,318
NDF				48,318		24,159		9,664		(9,664)		(24,159)		(48,318)
Net effect				-		-		-		-		-		-
Corn - B3		1,445		722		1,084		1,300		1,589		1,806		2,167
Cost of Sales				(266,037)		(133,018)		(53,207)		53,207		133,018		266,037
Collar				40,052		20,741		9,025		(5,087)		(13,216)		(32,528)
NDF				219,671		109,835		43,934		(43,934)		(109,835)		(219,671)
Put				4,594		2,297		919		(502)		(502)		(502)
Net effect				(1,720)		(145)		671		3,684		9,465		13,336

(1) Base price of each commodity in USD/ton, except for Corn – B3 denominated in R$/ton.

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23.7. Financial instruments by category

Schedule of financial instruments by category

	09.30.21
	Amortized cost		Fair value through other comprehensive income		Fair value through profit and loss		Total
			Equity instruments
Assets
Cash and bank	2,203,097		-		-		2,203,097
Cash equivalents	-		-		4,686,747		4,686,747
Marketable securities	347,650		13,290		358,148		719,088
Restricted cash	24,530		-		-		24,530
Trade accounts receivable	3,236,504		-		315,657		3,552,161
Other receivables	76,476		-		-		76,476
Derivatives not designated	-		-		29,864		29,864
Derivatives designated as hedge accounting (1)	-		-		55,419		55,419
Liabilities
Trade accounts payable	(11,089,196)		-		-		(11,089,196)
Supply chain finance	(1,889,219)		-		-		(1,889,219)
Loans and borrowings (2)	(21,782,488)		-		(2,396,114)		(24,178,602)
Derivatives not designated	-		-		(9,399)		(9,399)
Derivatives designated as hedge accounting (1)	-		-		(212,825)		(212,825)
Written option– business combination	-		-		(471,738)		(471,738)
	(28,872,646)		13,290		2,355,759		(26,503,597)

(1) All derivatives are classified at fair value through profit and loss. Those designated as hedge accounting instruments have their gains and losses also affecting Equity and Inventories.

(2) The part of the loans and borrowings the is object in a fair value hedge is classified as Fair value through profit and loss. The rest of the loans and borrowings balance is classified as amortized cost and those designated as cash flow or net investment hedge accounting instruments have their gains and losses also affecting Equity.

	12.31.20
	Amortized cost		Fair value through other comprehensive income		Fair value through profit and loss		Total
			Equity instruments
Assets
Cash and bank	2,439,072		-		-		2,439,072
Cash equivalents	-		-		5,137,553		5,137,553
Marketable securities	287,504		42,029		329,202		658,735
Restricted cash	24,358		-		-		24,358
Trade accounts receivable	3,789,616		-		310,265		4,099,881
Other receivables	86,404		-		-		86,404
Derivatives not designated	-		-		75,478		75,478
Derivatives designated as hedge accounting	-		-		302,512		302,512
Liabilities
Trade accounts payable	(9,009,987)		-		-		(9,009,987)
Supply chain finance	(1,452,637)		-		-		(1,452,637)
Loans and borrowings	(22,404,426)		-		-		(22,404,426)
Derivatives not designated	-		-		(34,685)		(34,685)
Derivatives designated as hedge accounting	-		-		(351,011)		(351,011)
Written option– business combination	-		-		(185,401)		(185,401)
	(26,240,096)		42,029		5,583,913		(20,614,154)

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23.8. Fair value of financial instruments

The fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Depending on the inputs used for measurement, the financial instruments at fair value may be classified into 3 hierarchy levels:

» Level 1 – Uses quoted prices (unadjusted) for identical instruments in active markets. In this category are classified investments in stocks, savings accounts, overnights, term deposits, Financial Treasury Bills (“LFT”) and investment funds;

» Level 2 – Uses prices quoted in active markets for similar instruments, prices quoted for identical or similar instruments in non-active markets and evaluation models for which inputs are observable. In this level are classified the investments in Bank Deposit Certificates (“CDB”) and derivatives, which are measured by well-known pricing models: discounted cash flows and Black-Scholes. The observable inputs are interest rates and curves, volatility factors and foreign exchange rates;

» Level 3 – Instruments for which significant inputs are non-observable. The Company has a financial liability arising from a put option written in the context of a business combination.

The table below presents the overall classification of financial instruments measured at fair value by measurement hierarchy. For the nine-month period ended on September 30, 2021, there were no changes among the 3 levels of hierarchy.

	09.30.21								12.31.20
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Financial Assets
Fair value through other comprehensive income
Stocks	13,290		-		-		13,290		42,029		-		-		42,029
Fair value through profit and loss
Savings account and overnight	600,449		-		-		600,449		1,220,232		-		-		1,220,232
Term deposits	-		-		-		-		250,189		-		-		250,189
Bank deposit certificates	-		4,082,178		-		4,082,178		-		3,662,448		-		3,662,448
Financial treasury bills	318,893		-		-		318,893		312,515		-		-		312,515
Investment funds	43,375		-		-		43,375		21,371		-		-		21,371
Trade accounts receivable	-		315,657		-		315,657		-		310,265		-		310,265
Derivatives	-		85,283		-		85,283		-		377,990		-		377,990
Financial Liabilities
Fair value through profit and loss
Derivatives	-		(222,224)		-		(222,224)		-		(385,696)		-		(385,696)
Loans and borrowings	-		(2,396,114)		-		(2,396,114)		-		-		-		-
Written option– business combination	-		-		(471,738)		(471,738)		-		-		(185,401)		(185,401)
	976,007		1,864,780		(471,738)		2,369,049		1,846,336		3,965,007		(185,401)		5,625,942

Except for the items set forth below, the fair value of all other financial instruments is approximate to their book value. The fair value of the bonds set forth below is based on prices observed in active markets, level 1 of the fair value hierarchy, while the debentures are based on level 2 and are measured by discounted cash flows.

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Schedule of comparison between book value and fair value of financial instruments

						09.30.21				12.31.20
		Currency		Maturity		Book value		Fair value		Book value		Fair value
BRF S.A.
BRF SA BRFSBZ 5 7/8		USD		2022		(392,757)		(405,968)		(367,714)		(389,611)
BRF SA BRFSBZ 4 3/4		USD		2024		(1,633,188)		(1,726,110)		(1,538,086)		(1,659,891)
BRF SA BRFSBZ 3.95		USD		2023		(1,283,410)		(1,329,486)		(1,207,468)		(1,275,598)
BRF SA BRFSBZ 2 3/4		EUR		2022		(1,060,043)		(1,072,548)		(1,081,404)		(1,105,478)
BRF SA BRFSBZ 4 7/8		USD		2030		(3,760,174)		(3,817,461)		(3,951,539)		(4,333,054)
BRF SA BRFSBZ 5 3/4		USD		2050		(4,234,323)		(4,182,534)		(4,106,115)		(4,705,851)
Debenture - 1st Issue		BRL		2026		(815,842)		(817,075)		(771,138)		(778,016)
Debenture - 2nd Issue		BRL		2030		(2,292,024)		(2,297,006)		(2,250,867)		(2,225,796)
Debenture - 3rd Issue		BRL		2031		(1,018,992)		(882,766)		-		-
BRF GmbH
BRF SA BRFSBZ 4.35		USD		2026		(2,676,797)		(2,813,142)		(2,577,667)		(2,779,574)
						(19,167,550)		(19,344,096)		(17,851,998)		(19,252,869)

23.8.1. Level 3 measurement

The Company holds a financial liability arising from a put option written in the context of a business combination. This option gives the non-controlling shareholder the right to sell its equity stake in the subsidiary for an amount equivalent, in Turkish Liras, to a multiple of the Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) of the economic group of this subsidiary in the last 12 months prior to the exercise. The exercise period is comprised of the six-month period beginning on May 25, 2021. This liability is measured at the present value of redemption amount using internal assumptions regarding the results of that economic group.

The effects of the subsequent measurement resulted in a loss in financial results of R$278,618 in the nine-month ended on September 30, 2021 (gain of R$533,774 in the same period of the prior year) and a loss of R$352,790 for the three-month period ended on September 30, 2021 (gain of R$143,421 in the same period of the prior year), as per note 28.

24. SEGMENT INFORMATION

The operating segments are reported consistently with the management reports provided to the main strategic and operational decision makers for assessing the performance of each segment and allocation of resources. The operating segments information is prepared considering three reportable segments, being: Brazil, International and Other Segments.

The operating segments include the sales of all distribution channels and are subdivided according to the nature of the products, for which the characteristics are described below:

» Poultry: production and sale of whole poultry and in-natura cuts.

» Pork and others: production and sale of in-natura cuts.

» Processed: production and sale of processed food, frozen and processed products derived from poultry, pork and beef, margarine, vegetables and soybean-based products.

» Other sales: sale of flour for food service and others.

Other segments are comprised of commercialization and development of animal nutrition ingredients, human nutrition, plant nutrition (fertilizers), healthcare (health and wellness), pet food, as well as commercialization of agricultural products.

The items not allocated to the segments are presented as Corporate and refer to relevant events not attributable to the operating segments.

The net sales for each reportable operating segment is set forth below:

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Schedule of net sales for each operating segment

				2021				2020
Net sales		Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Brazil
In-natura		1,634,165		4,380,670		1,251,395		3,601,927
Poultry		1,255,312		3,324,314		907,235		2,670,960
Pork and other		378,853		1,056,356		344,160		930,967
Processed		4,740,367		13,167,042		4,032,656		10,966,468
Other sales		17,509		54,550		7,654		21,321
		6,392,041		17,602,262		5,291,705		14,589,716
International
In-natura		4,642,946		13,250,947		3,635,187		10,651,454
Poultry		4,047,027		11,291,729		3,016,452		8,994,799
Pork and other		595,919		1,959,218		618,735		1,656,655
Processed		758,768		2,162,453		589,996		1,664,171
Other sales		46,992		284,362		84,187		216,733
		5,448,706		15,697,762		4,309,370		12,532,358
Other segments		549,238		1,318,839		341,516		873,508
		12,389,985		34,618,863		9,942,591		27,995,582

The income (loss) before financial results for each segment and for Corporate is set forth below:

Schedule of operating income for each operating segment

				2021				2020
		Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Brazil		515,846		1,015,749		566,784		1,282,928
International		113,515		569,495		200,302		868,636
Other segments		105,017		282,076		62,496		122,654
Sub total		734,378		1,867,320		829,582		2,274,218
Corporate		(3,898)		71,393		(85,505)		(183,839)
		730,480		1,938,713		744,077		2,090,379

The composition of the main effects not allocated to the operating segments and presented as Corporate is set forth below:

Schedule of composition of the main effects not allocated to the operating segments

				2021				2020
Corporate		Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Expenses COVID-19 (1)		(23,386)		(48,382)		(40,568)		(66,828)
Investigations involving the Company (note 1.5)		(412)		(8,554)		(4,027)		(28,099)
Expenses with demobilization		(634)		(3,654)		(5,034)		(5,034)
Impairment and result in the sale of investments		52,557		76,147		-		(6,763)
Reversal/(provision) for tax and civil contingencies		(35,230)		39,695		(5,350)		(65,239)
Results with sale and disposal of fixed assets		4,173		16,258		(5,544)		(11,531)
Results with disposal of businesses		-				(26,943)		(26,943)
Arbitration reversal		-		-		-		14,520
Restructuring plan		-		-		-		13
Other		(966)		(117)		1,961		12,065
		(3,898)		71,393		(85,505)		(183,839)

(1) Mainly comprised of donations in Brazil, consultants and expenses with health and safety, which are not associated with the business segments.

No customer individually or in aggregate (economic group) accounted for more than 5% of net sales for the nine-month period ended on September 30, 2021 and 2020.

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The goodwill arising from business combinations and the intangible assets with indefinite useful life (trademarks) were allocated to the reportable operating segments, considering the economic benefits generated by such intangible assets. The allocation of these intangible assets is presented below:

Schedule of goodwill and intangible assets arising from business combination

	Goodwill				Trademarks				Total
	09.30.21		12.31.20		09.30.21		12.31.20		09.30.21		12.31.20
Brazil	1,151,498		1,151,498		982,478		982,478		2,133,976		2,133,976
International	1,868,105		1,784,079		323,485		345,260		2,191,590		2,129,339
Other segments	1,011,828		-		298		-		1,012,126		-
	4,031,431		2,935,577		1,306,261		1,327,738		5,337,692		4,263,315

Information related to total assets by reportable segment is not disclosed, as it is not included in the set of information made available to the Company’s management, which makes investment decisions and determine allocation of resources based on information about the consolidated assets.

25. NET SALES

Schedule of net sales

											2021				2020
									Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Gross sales
Brazil									7,916,297		21,802,401		6,512,264		18,018,393
International									5,839,915		16,826,837		4,636,072		13,440,650
Other segments									625,962		1,473,572		378,246		968,825
									14,382,174		40,102,810		11,526,582		32,427,868
Sales deductions
Brazil									(1,524,256)		(4,200,139)		(1,220,559)		(3,428,677)
International									(391,209)		(1,129,075)		(326,702)		(908,292)
Other segments									(76,724)		(154,733)		(36,730)		(95,317)
									(1,992,189)		(5,483,947)		(1,583,991)		(4,432,286)
Net sales
Brazil									6,392,041		17,602,262		5,291,705		14,589,716
International									5,448,706		15,697,762		4,309,370		12,532,358
Other segments									549,238		1,318,839		341,516		873,508
									12,389,985		34,618,863		9,942,591		27,995,582

26. OTHER OPERATING INCOME (EXPENSES), NET

Schedule of other operating income (expense)

											2021				2020
									Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Recovery of expenses (1)									16,136		85,372		83,114		318,172
Provision reversal									809		809		1,756		72,381
Scrap sales									3,317		9,273		3,111		8,672
Provision for civil and tax risks									(32,202)		42,518		(13,719)		(79,238)
Other employees benefits									(8,225)		(22,637)		(6,862)		(22,512)
Insurance claims costs									(16,741)		(28,023)		(877)		(3,394)
Gains (losses) on the disposal of non-financial assets									53,761		89,775		(16,874)		(24,026)
Employee participation and bonuses									(36,200)		(65,255)		(41,678)		(159,669)
Demobilization expenses									(634)		(3,654)		(8,534)		(14,790)
Expected credit losses in other receivables									1,831		742		32		(3,125)
Other (2)									(3,451)		(5,339)		(12,662)		(1,228)
OTHER OPERATING INCOME (EXPENSES), NET									(21,599)		103,581		(13,193)		91,243

(1) Includes recovery of PIS and COFINS taxes on inputs in the amount of R$27,280 and effects of the final decision related to the exclusion of ICMS from the PIS and COFINS calculation basis of Batávia and UP! Alimentos Ltda. in the amount of R$40,501 (note 9.1) for the nine-month period ended on September 30, 2021 (R$295,593 of recovery of PIS and COFINS taxes on inputs in the same period of previous year).

(2) Includes expenditures with investigations (note 1.5).

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27. FINANCIAL INCOME (EXPENSES), NET

 Schedule of finance income

					2021				2020
	Note		Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Financial income
Interest on cash and cash equivalents	4		46,831		104,195		34,938		85,967
Income with marketable securities	5		14,082		32,100		6,530		51,917
Fair value through other comprehensive income			-		-		84		538
Fair value through profit and loss			3,888		7,884		1,588		7,304
Amortized cost			10,194		24,216		4,858		44,075
Interest on recoverable taxes (1)	9		60,908		172,869		18,723		99,063
Interest on other assets			11,985		31,119		12,511		30,466
Financial income			133,806		340,283		72,702		267,413
Financial expenses
Interests on loans and borrowings	14		(361,115)		(1,216,925)		(490,955)		(1,122,525)
Interest on contingencies	20		(64,696)		(185,584)		(25,004)		(110,581)
Interest on leases	17		(48,555)		(165,536)		(50,829)		(154,692)
Interest on actuarial liabilities			(11,181)		(33,810)		(10,178)		(30,541)
Interest on other liabilities			2,278		1,927		4,030		9,414
Written option - Business combination	23.8.1		(352,790)		(278,618)		143,421		533,774
Adjustment to present value	6 and 15		(170,911)		(457,011)		(109,760)		(291,258)
Other			(40,219)		(135,321)		(52,391)		(161,170)
Financial expenses			(1,047,189)		(2,470,878)		(591,666)		(1,327,579)
Foreign exchange and monetary variations
Exchange rate variation on monetary assets and liabilities			(625,672)		(359,457)		4,420		(1,529,314)
Derivative results			554,097		143,076		78,125		1,356,289
Monetary, exchange and derivative results, net			(71,575)		(216,381)		82,545		(173,025)
Financial income (expenses), net			(984,958)		(2,346,976)		(436,419)		(1,233,191)

(1) For the nine-month period ended on September 30, 2021, the effect includes the final decision related to the exclusion of ICMS from the PIS and COFINS calculation basis from Batávia and UP! Alimentos Ltda. (note 9) in the amount of R$50,434 (null in the same period of the previous year).

28. STATEMENT OF INCOME BY NATURE

The Company discloses its statement of income by function and thus presents below the details by nature:

				2021				2020
		Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Costs of sales
Raw materials and supplies (1)		7,370,370		20,634,986		5,417,106		15,140,087
Salaries and employees benefits		1,106,742		3,210,703		1,060,402		3,007,577
Depreciation		529,589		1,537,582		466,876		1,379,928
Amortization		32,106		103,626		40,500		98,083
Other		726,496		2,086,342		613,249		1,793,580
Costs of sales		9,765,303		27,573,239		7,598,133		21,419,255
Sales expenses
Indirect and direct logistics expenses		835,633		2,251,726		619,365		1,827,774
Marketing		166,046		482,650		137,473		427,706
Salaries and employees benefits		362,960		1,059,427		363,920		1,035,654
Depreciation		81,781		273,804		49,703		160,816
Amortization		21,971		76,121		27,454		70,166
Other		179,370		481,171		168,554		489,576
Sales expenses		1,647,761		4,624,899		1,366,469		4,011,692
Administrative expenses
Salaries and employees benefits		92,080		276,389		91,931		247,770
Fees		14,977		39,801		12,387		41,600
Depreciation		8,176		34,882		13,917		35,544
Amortization		7,212		30,278		13,255		28,968
Other		99,262		192,616		85,858		196,491
Administrative expenses		221,707		573,966		217,348		550,373

(1) Includes recoveries of PIS and COFINS taxes on inputs and export credits in the amount of R$43,817 for the nine-month period ended on September 30, 2021 (null in the same period of the previous year).

The Company incurred in expenses with internal research and development of new products of R$30,840 for the nine-month period ended on September 30, 2021 (R$48,228 in the same period of the prior year) and R$10,385 for the three-month period ended on September 30, 2021 (R$17,041 in the same period of the prior year).

29. RELATED PARTIES

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In the normal course of business, rights and obligations arise between related parties, resulting from transactions of sale and purchase of products, as well as from financial operations.

The Company holds a Related Parties Transactions Policy, which was reviewed and approved by the Board of Directors and applies to all subsidiaries of the group.

The policy mentioned above provides the conditions that must be observed for the realization of a transaction between related parties, as well as establishes approval hierarchies according to the value and nature of the transactions involved. The policy also foresees situations of conflict of interests and how they must be conducted.

In May and June 2021, Marfrig Global Foods S.A. (“Marfrig”) acquired common shares issued by BRF S.A., achieving 31.66% of participation in the Company’s capital stock. With such participation, Marfrig is able to exercise significant influence over BRF S.A., becoming a related party. On October 20, 2021, the Administrative Council for Economic Defense’s Court (Tribunal do Conselho Administrativo de Defesa Econômica − CADE) confirmed the approval without restrictions of the acquisition by Marfrig of a corporate interest in the Company’s capital stock. The transactions and balances with Marfrig and its subsidiaries during the period are presented below.

Schedule of transaction and balances of other parties

	Accounts receivable		Trade accounts payable
	09.30.21		09.30.21
Marfrig Global Foods S.A.	4,813		(21,708)
Marfrig Chile S.A.	610		-
Quickfood S.A.	12,184		-
Marfrig Alimentos S.A.	99		-
Total	17,706		(21,708)

	Sales				Purchases
			2021				2021
	Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Marfrig Global Foods S.A. (1)	12,982		20,925		(96,907)		(151,437)
Marfrig Chile S.A. (1)	899		3,055		-		-
Quickfood S.A. (1)	19,207		19,207		-		-
Marfrig Alimentos S.A. (1)	139		139		(54,530)		(54,530)
Total	33,227		43,326		(151,437)		(205,967)

(1) The period ranges from May 21,2021 to September 30, 2021.

The subsidiaries of the Company enter into loan agreements pursuant its cash management strategy. As of September 30, 2021, the balance of these transactions was R$2,458,346 (R$2,116,463 as of December 31, 2020) with a weighted average rate of 3.94% p.a. (3.01% p.a. as of December 31, 2020).

The Company has made contributions related to the post-employment benefit plans of its employees to BRF Previdência, which holds these plans (note 20). Additionally, the Company leased properties owned by BRF Previdência, and for the nine-month period ended on September 30, 2021 the total amount of lease payments was R$15,410 (R$14,646 in the same period of the prior year) for the three-month period ended on September 30, 2021, the total amount of lease payments was R$5,202 (R$4,882 in the same period of the prior year).

The Company maintains other transactions with related parties resulting from guarantees, transferences and donations to related associations and institutes, as well as leasing and other commercial transactions with related people and entities. Such transactions are compliant with the Related Party Transactions Policy and are not relevant, individually or in aggregate.

29.1. Management remuneration

The total remuneration and benefits expense with board members, statutory directors and the head of internal audit are set forth below:

Schedule of total remuneration and benefits paid to professionals

			2021				2020
	Jul - Sep		Jan - Sep		Jul - Sep		Jan - Sep
Salary and profit sharing	14,930		46,117		14,064		49,669
Short-term benefits (1)	76		500		680		2,291
Private pension	282		872		304		1,200
Termination benefits	200		1,698		2,104		6,507
Share-based payment	7,668		21,854		5,561		13,955
Total remuneration and benefits paid to professionals	23,156		71,041		22,713		73,622

(1) Comprises: medical assistance, educational expenses and others.

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In addition, the executive officers (non-statutory) received among remuneration and benefits the total amount of R$19,484 for the nine-month period ended on September 30, 2021 (R$15,739 in the same period of the prior year) and R$6,257 for the three-month period ended on September 30, 2021 (R$6,304 in the same period of the prior year).

30. COMMITMENTS

In the normal course of the business, the Company enters into agreements with third parties for the purchase of raw material, mainly corn and soymeal. The agreed prices in these agreements can be fixed or variable. The Company also enters into other agreements, such as electricity supply, packaging supplies, construction of buildings and others for the supply of its manufacturing activities. The firm commitments schedule is set forth below:

				09.30.21
Current				5,508,563
Non-current				1,996,385
October to December 2022				425,407
2023				704,311
2024				289,910
2025				173,878
2026 onwards				402,879
Total				7,504,948

31. TRANSACTIONS THAT DO NOT INVOLVE CASH

The following transactions did not involve cash or cash equivalents during the nine-month period ended on September 30, 2021:

(i) Capitalized loan interest: as referred in note 13.

(ii) Addition of lease by right-of-use assets and respective lease liability: in the nine-month period ended on September 30, 2021 amounted to R$551,554 (R$268,520 in the same period of the prior year) and in the three-month period ended on September 30, 2021, amounted to R$172,979 (R$40,920 in the same period of the prior year).

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32. EVENTS AFTER THE REPORTING PERIOD

32.1. Amendment to the shareholders’ agreement with Qatar Holding

On December 13, 2021, the Company has executed an amendment to the shareholders’ agreement with Qatar Holding LLC, a wholly-owned subsidiary of the Qatar Investment Authority (“QIA”). The amendment provides for new terms and conditions of their partnership in TBQ Foods GmbH (“TBQ”), a holding company held 60% by BRF and 40% by QIA, which holds 91.7% of the shares issued by Banvit Bandırma Vitaminli Yem Sanayi Anonim Şirketi (“Banvit”).

In the amendment, BRF and QIA have agreed on the termination of the put option available to QIA under the original shareholders’ agreement. From 2023, QIA will have further alternatives to liquidate its investment in Banvit and in any event, BRF’s financial liability towards QIA has been terminated.

On December 13, 2021, the financial liability was derecognized with a corresponding increase in the non-controlling interests.

32.2. Call notice for the 2022 Extraordinary General Shareholders' Meeting

On December 16, 2021, the Board of Directors approved the call notice and the management proposal for the Extraordinary General Shareholders' Meeting ("EGM") to be held on January 17, 2022. The agenda of the meeting include:

(i) to resolve on the proposal to amend the limit of authorization for capital increase, regardless of statutory reform, with the resulting amendment of article 7 and the consolidation of the Company’s bylaws;

(ii) to approve the Company's capital increase by means of a public offering for primary distribution, pursuant to CVM Instruction 476 of January 16, 2009 and other applicable regulations, of up to 325,000,000 (three hundred and twenty-five million) new common shares, registered and with no par value, including in the form of American Depositary Shares (ADS), represented by American Depositary Receipt (ADR);

(iii) to establish that, of the total value of the offering: (a) R$500,000 (five hundred million reais) shall be allocated to the capital stock; and (b) the remaining amount of the value of the offering will be allocated to the formation of a capital reserve, in accordance with the provisions of article 182, paragraph 1, item 'a', of Law No. 6,404/1976; (iv) to authorize, for all legal purposes and effects, the Company's management to perform all acts necessary and/or convenient to implement the capital increase and the offering; (v) to authorize the Board of Directors, if the market conditions make the capital increase and the offering not advisable, at its sole discretion, at any time, not to implement or cancel the capital increase and the offering without the need for subsequent ratification by the Company's shareholders; and

(iv) to authorize the Board of Directors to (a) establish the quantity of shares to be effectively issued (respecting the maximum quantity established by the EGM), (b) approve the share price, and (c) homologate the capital increase.

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33. APPROVAL OF THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION

The condensed consolidated interim financial information was approved and the issuance authorized by the Board of Directors on January 14, 2022.

BOARD OF DIRECTORS
Chairman (Independent)	Pedro Pullen Parente
Vice-Chairman (Independent)	Augusto Marques da Cruz Filho
Independent Member	Dan Ioschpe
Independent Member	Flavia Buarque de Almeida
Independent Member	Flavia Maria Bittencourt
Non-Independent Member	Ivandré Motiel da Silva
Independent Member	José Luiz Osório de Almeida Filho
Independent Member	Luiz Fernando Furlan
Independent Member	Marcelo Feriozzi Bacci
Independent Member	Roberto Rodrigues
FISCAL COUNCIL
Chairman	Attílio Guaspari
Member	André Vicentini
Member	Maria Paula Soares Aranha
AUDIT AND INTEGRITY COMMITTEE
Comittee Coordinator (Independent)	Augusto Marques da Cruz Filho
Non-Independent Member	Ivandré Motiel da Silva
Independent Member	Marcelo Feriozzi Bacci
External Member	Jerônimo Antunes
External Member	Valmir Pedro Rossi
BOARD OF EXECUTIVE OFFICERS
Global Chief Executive Officer	Lorival Nogueira Luz Júnior
Chief Financial and Investor Relations Officer	Carlos Alberto Bezerra de Moura
Vice-President of People, Services and Technology	Alessandro Rosa Bonorino
Vice-President of Institutional Relations and Sustainability	Grazielle Tallia Parenti
Vice-President of Integrated Planning and Logistics	Leonardo Campo Dallorto
Vice-President of New Business	Marcel Sacco
Vice-President of Brazil Market	Sidney Rogério Manzaro
Vice-President of Operations and Procurement	Vinícius Guimarães Barbosa
Marcos Roberto Badollato	Heitor Carpigiani de Paula
Accounting Director	Accountant – CRC 1SP336262/O-4

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