Performance Report 2012

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Letter from Juan Pablo Ortega, Ruta N s CEO: If you imagine it, it is possible.

Medellin, innovative city.

How Ruta N helps to make come true what you imagine.

CROSS-DIVISIONAL PROGRAMS

Science, Technology and Innovation Plan – STI Plan Technological and scientific district Landing Strategy

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INNOVATIONPLATFORM

Culture management.Startup WeekendMedellin in Fiction Solar Challenge Innovation Week The City of Medellin s Research Awards Emtech

Networking management.Pilot transfer of the SCRUM Program

Knowledge management.Technological Surveillance Technological Commercialization Intellectual PropertyCapacity building program in intellectual property

KNOWLEDGE BUSINESS OPPORTUNITIES

Access to markets.Ruta N Acceleration ProgramFounder ProgramDigital Entertainment StrategyApps.co Program

Access to capitalSeed Capital Fund

Generation of organizationalinnovation capabilities.Inngenio Program Innovation Management

MARKETING AND COMMUNICATIONS MANAGEMENT

ADMINISTRATIVE AND FINANCIAL MANAGEMENT.

We imagined it and we made it possible. Ruta N helps dreams come true.

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JUAN ESTEBAN CALLE RESTREPOGeneral Manager of Empresas Públicas de Medellín

MARC EICHMANN PERRETPresident of UNE

IVÁN DARÍO SANCHEZ HOYOSPrivate Secretary of the Mayor’s office of Medellin

LINA VÉLEZ DE NICHOLLSPresident of the Chamber of Commerce Medellin for Antioquia

JUAN SEBASTIÁN BETANCUR ESCOBARPresident of Proantioquia

ROSARIO CÓRDOBA GARCÉSPresident of the Private Competitiveness Council

JUAN GUILLERMO LONDOÑO POSADAPresident of Celsia

ALBERTO URIBE CORREADean of the University of Antioquia

CARLOS FELIPE LONDOÑO ÁLVAREZDean of the Engineering School of Antioquia

Deputies

RAFAEL AUBAD LÓPEZVice-president of Proantioquia

CLAUDIA CHAPMANDirector of Institutional Services of EPM

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“If you imagine it, its possible”

Let me begin the introduction of the 2012 Management Report by emphasizing the phrase that frames all our efforts during the entire year: “If you imagine it, it is possible.” These words not only are framework for our campaign to communicate the achievements of Ruta N; they are our manifesto, our view of how everything we do is supporting the dreams and ideas that many have been nourishing in recent years; we see with joy and pride that we are creating a culture of innovation in our city that is helping to break new ground in the economy of the region, and improving the quality of life of our citizens.

This organizational philosophy is better understood when viewed from Ruta N s KPIs from 2012. We have impacted about 10,000 citizens with our Innovation Culture programs; over 20 universities and institutions of the Regional Innovation System have strengthened theircapabilities through our Innovation Platforms programs. From our Knowledge Business initiatives, we have accompanied nearly 200 entrepreneurs, startups, SMEs and large companies; and from The Innovation District, we have been instrumental in the arrival of seven international companies to the city, which are currently located in the Ruta N Complex,thanks to the strategy to attract companies.

This impact has demonstrated the importance of a public institution that strategically helps to drive and leverage processes in science, technology and innovation. That is why different stakeholders have given us their trust and support to further develop new strategies and programs. An example of this is the Municipal Agreement 24, 2012, by which

public policy is defined as the implementation of the 2011-2021 Science, Technology and Innovation Plan of Medellin.

With this Agreement, we ensure resources to materialize the plan, thanks to the allocation of at least 7% of the regular revenues the Municipality of Medellin receives from EPM annually starting in 2013, which is projected to account for COP$417 billion committed by the city that will come to supplement the significant resources for science, technology and innovation from the Development Plan of Medellin this year. And COP$7 billion obtained through alliances with institutions as important as the ITC Ministry (Information Technology & Communications), Innpulsa, and Colciencias, or international cooperation programs such as ERICA (Spain and its regions knowledge exchange program with Antioquia).

LETTER FROMTHE CEO

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Juan Pablo Ortega IpuzCEO

Finally, I want to mention that we achieved the approval by year s end, of a macro-project in the health-care industry that will get COP$ 25 billion in funds from royalties. This macro-project, with a total of COP$42 billion, integrates 33 universities and companies around 16 projects in eHealth, tissues and medical equipment, and demonstrates the important collective effort of the city in science, technology and innovation.

All this great support is undoubtedly an immense bet that commands us to fully comply with new challenges. In Medellin, we imagine becoming a global innovation benchmark, and we are demonstrating with our actions that it is possible.

“The Metro system operation, which reduces CO2

emissions by 175,000 tons a year”

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For a decade, Medellin has undergone a process of social, urban, cultural, and economic transformation, which has enabled the city to appear to the world as a success story worth to advertise and promote. Thus, the city continues to create strategies and programs that allow it to continue to be a source of wonder for the world, and pride for its citizens, such as being awarded the recognition as The Most Innovative City In The Word this year, above new York, Tel Aviv and a group of more than 200 cities initially nominated as part of a competition led by Citi Group, the Wall Street Journal, and the Urban Land Institute.

This award, which emphasizes the innovative potential of the city, took into account, among

other achievements, the Metro system operation, which reduces CO2 emissions by 175,000 tons a year; the electric escalator of Comuna 13, environmental sustainability initiatives and quality of life improvements; the commitment of a government owned utility company such as EPM, to support community goals and objectives, such as improving education; the construction and the adequacy of facilities and attractions such as the library parks and cultural centers; the great advances in public transport, with the Metro Cable, the Metroplus and the bike-sharing program, among others, and the substantial reduction in the crime rate.

200cities initially nominated as part of a competition

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“WE ARE ABLE TO CONTINUE CHARTING A SAFE PATH IN

SCIENCE, TECHNOLOGY AND INNOVATION”

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This certainly demonstrates the ability we have in Medellin to seek innovative solutions to the various problems that our region has, and also tells us that We are able to continue charting a safe path in science, technology and innovation, as the city selected for its progress and its great social and urban innovation and immense potential, area in which from Ruta N Corporation Medellin, we have much to contribute.

In this context, City Hall is seeking to influence the improvement of competitiveness, by implementing a new policy approach to develop and deploy a plan to assert Medellin as a city of innovation and knowledge. It is a strategy involving all sorts of public, private and academic stakeholders, so that together, we set the direction that will drive the economy of the city, the region and the country.

But, what is this strategy?

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A DEVELOPMENT PLAN THAT BETS ON INNOVATION“COMPETITIVENESS FOR EQUITABLE ECONOMIC DEVELOPMENT”

Is the 3rd line of action of the current development plan- “Medellin, a home for life 2012-2015”. This line is focused on Medellin’s progress through the strengthening of its competitiveness and integration into globalization processes, with science, technology and innovation (STi) at its core.

Thus, this line includes the implementation of Medellin s 2011-2021 Science, Technology and Innovation Plan; the strengthening of entrepreneurship with high-potential growth and differentiation; the creation of the Seed Capital Fund with technological and innovative orientation, and the development of a science, technology and innovation district.

A SIGNIFICANT ALLOCATION OF RESOURCES TO IMPLEMENT MEDELLIN´S 2011-2021 SCIENCE, TECHNOLOGY AND INNOVATION PLAN

The resources to implement this plan are already secured by Medellin s City Council s Agreement 24, 2012, whereby Medellin s 2011-2021 Science, Technology and Innovation Plan is defined as public policy, to encourage, promote and coordinate policies supporting research, scientific and technological development and innovation in the city. Thus, it was established that this will be funded with at least 7% of the regular revenues Medellin receives from EPM annually, equivalent to COP$417 billion in the period 2013-2021.

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A SCIENCE, TECHNOLOGY AND INNOVATION DISTRICT THAT MAKES US MORE COMPETITIVE

Ruta N leads from the public sector, the consolidation of the city as an innovation and knowledge hub. For this reason, and to increase the competitiveness of the city, it has undertaken the development of a technology district in the neighborhoods of Chagualo, Jesus of Nazareth and Sevilla. This district will lay the foundation for economic development in this area, attracting companies and institutions related to science, technology, and innovation, especially in health-care, energy and IT&Communications-ICT.

This transformation has five dimensions: the urban, consisting of the physical transformation of the territory through real estate and infrastructure development; the entrepreneurial dimension, which promotes the attraction of national and international companies, and supports and strengthens local start-ups to later help them in the international arena; the social dimension, which seeks to include all citizens in this area of knowledge, by implementing a culture of innovation; the human talent that maps what professional skills the city needs to implement strategies that enable the creation, development and retention of talent in the territory; the innovation, that is looking for an integration between science and the market, to help figure out how to make science, technology and innovation to become relevant to the progress of the city, and finally, that of governance, which is transversal to all these dimensions and integrates them increasing the strength and relevance of this district.

TAX INCENTIVES TO PROMOTE INNOVATION

In order to stimulate the generation of innovative activities, Agreement 67 of 2010, gives property tax and industry & commerce tax exemptions to companies with innovative activities from industry clusters in Textiles/Apparel, Design & Fashion, Construction, Business Tourism, Fairs & Conventions, Medical and Dental Services, IT & Communications, and Electricity.

In December 2012, in order to make proposals and agreements to improve the reception of this benefit and its impact on the companies of Medellin, the Council of Medellin approved, in the Tax Code, Article

182 which provides that the Municipal Administration organize a working group composed of the Secretary’s office of the Treasury, the Sub-direction of Prospective of the City, Ruta N, the Centre for Science and Technology of Antioquia (CTA, for its acronym in Spanish), cluster managers, and representatives of the employers, for that in a term of six months, issue regulations defining the scope and instruments necessary for the implementation of the tax benefits set out in Article 170 of the same statute.

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A STRONG ALLIANCE OF THE PUBLIC, PRIVATE AND ACADEMIC SECTORS, WHICH ALLOWS TO JOINT EFFORTS AROUND SCIENCE, TECHNOLOGY, AND INNOVATION

Thanks to the University, company, and State alliance, the city has guaranteed that it thinks in STi transversally in all processes, and so we work in an articulated fashion in order to develop, together, a knowledge economy.

CONSOLIDATION OF THE MEDELLIN RUTA N CORPORATION

Created by the Mayor’s office of Medellin, UNE, and EPM, it is an entity from which to develop individual programs, and channel the resources of the municipality for science, technology and innovation. The corporation seeks to promote the development of innovative technology-based businesses, which increase the competitiveness of the city, revitalize the economy, strengthen the city’s clusters, enable better jobs for the citizens of Medellin, and, ultimately, to enhance the quality of life for all.

A PLAN FOR SCIENCE, TECHNOLOGY AND INNOVATION AS A ROADMAP IN THIS CITY OF KNOWLEDGE

This plan is the road map of the city in STi. It Includes programs and projects prioritized around two strategic objectives: development of emerging businesses that enhance the sectors of energy, health and ICT, and the development of capacities in innovation with which to strengthen and contribute to the efficiency and quality of the Regional Innovation. The plan identifies strategic actions in STi of the city on a horizon of 10 years, from 2011 to 2021.

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A LANDING SERVICE TO ATTRACT DOMESTIC AND FOREIGN COMPANIES TO MEDELLIN

It is a strategy led by Ruta N, with support from the Agency for Cooperation and Investment of Medellin and the Metropolitan Area (ACI, for its acronym in Spanish), which seeks to provide a value proposition of temporary seating and related services to domestic and foreign companies belonging to the strategic sectors defined in the Medellin STi Plan 2011-2021, which would allow the initiation of operations and integrate to the innovation ecosystem in an easy and quick fashion.

Known as the Landing Program, this service is the first step in the consolidation of the Science, Technology and Innovation District in the proposed Development Plan 2012-2015, which will seek to attract domestic and foreign companies that operate in strategic areas such as health, energy and technologies of information and communication (ICT).

AN INNOVATION FUND OF SEED CAPITAL FOR TECHNOLOGY-BASED COMPANIES

Structured and led by Ruta N with resources of the Municipality of Medellin, the fund will provide financial support for programs, projects and activities with high content of science and technology, aimed at strengthening the innovation capacities of the city’s strategic clusters and emerging sectors, through investment in new business development of knowledge in the seed capital phase.

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As evidenced in the previous chapter, Ruta N, as the voice for the mayor’s office on issues of science, technology and innovation, works to comply with the mega that Medellin stated as to be the innovation capital of Latin America. Thus, during the three years that have been met since its inception, the corporation has helped this knowledge economy to become increasingly a reality.

TRANSVERSAL PROJECTS They are strategic projects in which the different management posts of Ruta N are involved.

PLAN OF SCIENCE, AND INNOVATION (CTI) DE MEDELLíN 2011-2021 Ruta N has within its mission the responsibility to lead the implementation of the Plan of STi of Medellin, which defines the roadmap to take advantage of different opportunities and needs for innovation for competitiveness. This is a set of programs and projects to execute until 2021, seeking to contribute to the development of the city by focusing on three strategic sectors, energy, health and ICT, and all cross-cutting activities that strengthen the capacity for all players of the Regional Innovation System.

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TECHNOLOGICAL AND SCIENTIFIC DISTRICT

The Ruta N Corporation is pursuing the consolidation of Medellin as a city of innovation and knowledge. As part of this strategy, and in compliance with the development plan of the city, it has undertaken the development of a technology district of 114 hectares, comprising the neighborhoods of Sevilla, Chagualo and Jesus Nazareno. This district will lay the foundation for the economic development in this area, through the attraction of companies related to science, technology and innovation, especially in the areas of health, energy and ICT.

During 2012, it initiated the formulation involving multiple entities at the municipal order, and the accompaniment of the District 22 @ of Barcelona, and the prestigious MIT University.

LANDING STRATEGY

The Landing strategy is linked to the Technological and Scientific District policy, which is led by Ruta N with the support of the ACI - Agency for Cooperation and Investment of Medellin and the Metropolitan Area, to make it easier for small and medium sized technology-based businesses, foreign or domestic, knowledge intensive and focused on strategic sectors in the city of Medellin, access to an ecosystem of innovation and business to enable them, in short time, joining the business dynamics of the city-region, and from there, build a profitable and sustainable business in the rest of Colombia, Latin America and the world.

In parallel, the management areas of the Platforms of Innovation and Knowledge Business have conducted several programs and projects to help transfer to the Regional System of Innovation, multiple capacities and knowledge in STi, and strengthen and drive new technology-based businesses.

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INNOVATION PLATFORM

It aims to work with universities, research groups, and technology development centers; technology-based incubators, productivity centers, and other entities interfacing with the Regional Innovation System to consolidate the favorable conditions that allow the capacities in science and technology enable innovation in the region.

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To achieve this goal, we work from three main areas:

CULTURE OF INNOVATION: a set of activities to introduce, promote and encourage innovation in the public, so that innovative culture becomes a common language and a true aspiration for all, and to understand the importance of science, technology and innovation for the development and competitiveness of the city, because innovation is a dynamic that not only must be sought and promoted within companies, but must have a society committed to it, that support with their actions and attitudes those values liked to it.

PROGRAMS DEVELOPED IN 2012

INNOVATION WEEK 2012:

The Ruta N Corporation of Medellin, in compliance with the Municipal Agreement 48 of 2010, carries out the coordination and organization of the Week of Science, Technology, and Innovation of the city, as an event that promotes innovation in Medellin.

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“encourage the emergence of new

prototypes and digital business and ICT”

STARTUP WEEKEND

This activity aims to encourage the emergence of new prototypes and digital business and ICT, through the creation of opportunities for learning and community building around innovation, entrepreneurship and

technology.MEDELLÍN EN FICCIÓN

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SOLAR CHALLENGE:

A program to promote innovation in high-school students from different schools in the city and municipalities of the department, participating in the competition for the development of solar cars as a commitment to the construction of a society that is creative, innovative, and committed to the care of the environment, natural resources and the development of the city.

MEDELLIN IN FICTION

A competition aimed at creating spaces that encourage community gathering of the digital animators in the city, stimulating the strengthening of their capabilities in creative thinking, narrative of stories in science fiction and video production, from knowledge transfer international of experts in these subjects that came from Japan, the U.S., and Spain.

“A program to promote innovation in high-school

students from different schools in the city and

municipalities of the department”

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INNOVATION AWARDS UNDER THE SCIENCE, TECHNOLOGY AND INNOVATION FAIR:

As part of the strategy of awareness-raising of the children and youth of the city, Ruta N joined the fifth version of the Science, Technology and innovation Fair held annually by Secretary’s office of Education and the Explora Park, with the objective of coordinating research and innovation in the student audience, sharing with youngsters and children the opportunities offered by the Corporation, such as lectures with international speakers, and the awards to winners of the new category of the fair, “Innovation Award,” with internships at international trade fairs and events.

AWARDS OF THE MAYOR’S OFFICE OF MEDELLIN FOR RESEARCH:

It is a prize framed within the program of research support for students and researchers from public and private universities in the city of Medellin, to highlight the importance of research for the development of the city, praising the work of the people and institutions whose work contributes to the solution of environmental problems.En la séptima versión de los Premios a la Investigación se introdujo la categoría de Innovación, como una apuesta desde Ruta N

In the seventh version of the Research Awards, the innovation category was introduced as a bet from Ruta N to recognize researches committed to innovation.

“highlight the importance of research for the development of the city”EMTECH:

It is the annual Congress of the MIT’S Technology Review magazine on emerging technologies, which analyzes the impact of research and technological development in society and business.

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NETWORK MANAGEMENT: It promotes system players to connect with each other, as well as helping them to create connections and share knowledge about everything that happens at the national and international levels in technological, financial and market subject-matters. This axis is seeking to help establish effective contacts, through the generation of bilateral channels and global networks of knowledge, capital, market, and service.

PROGRAMS DEVELOPED DURING 2012

PILOT TRANSFER OF THE SCRUM PROGRAM: It seeks to strengthen competencies in implementing the Scrum methodology for developing expertise for formulating projects of specialized staff linked to companies involved in software development in the city of Medellin.

Scrum is an agile methodology that enables software development through the planning and provision of resources differently than previously known. It focuses on milestones or intermediate sprints work that maximizes the competitiveness and productivity of enterprises and increases the benefit of its customers.

“create connections and share knowledge about everything that happens at the national and international levels”

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Jorge imagined that to reach very high, intelligence is more important than strength, and Ruta N endorsed and supported him.

With the Metropolitan Institute of Technology team, Jorge participated in the program of Technological Surveillance and Intelligence, to make all companies in the region more

efficient and competitive.

PROGRAM OF TECHNOLOGICAL SURVEILLANCE AND COMPETITIVE INTELLIGENCE:

It seeks to promote the appropriation of methodologies and techniques in technology surveillance and competitive intelligence in higher-education institutions and the agents of the Science, Technology and Innovation System of the city, that are based on generating business in the competitive knowledge in the international markets and to promote capacity building in this area of knowledge.

KNOWLEDGE MANAGEMENT: It aims to promote the market vision of in the institutions of the Regional Innovation System, with capabilities in the areas of science, technology and innovation. Projects such as surveillance technology, intellectual property and technology commercialization, are priorities for connecting market challenges facing the international competitiveness. Thus, it is how Ruta N seeks to permeate the city’s institutions, encouraging the consolidation of these competencies through knowledge transfer and implementation of programs, among other mechanisms. These actions seek to develop an ecosystem for the exchange of knowledge.

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TECHNOLOGY COMMERCIALIzATION PROGRAM:

It is a practical training program enabling the creation and the strengthening of the necessary competencies to execute in an efficient and market-oriented fashion, knowledge transfer process, and their transformation into new business of high value-added knowledge and global reach. The program is based on the concept of ‘learning by doing’, where each participating group must develop their learning on a real application case, in which the knowledge imparted by team of the IC2 Institute at the University of Texas, at Austin, can be implemented.

INTELLECTUAL PROPERTY (IP):

All programs offered in this field aim to develop and strengthen the knowledge and capabilities of academic institutions and companies in the field of intellectual property, as an input into the processes necessary for innovation and technology transfer.

IP CLINIC:

Knowledge sharing and socialization of practical models on issues of confidentiality, identification of knowledge assets, and intellectual property management.

Awareness program on intellectual property with international experts: It aims at conducting a first approach with key players in the process of research, development and innovation, and also strengthens knowledge in intellectual property and fostering relations between SMEs and universities, from the recognition of global trends and successful cases in IP management.

“develop and strengthen the knowledge and

capabilities of academic institutions and

companies in the field of intellectual property”

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CAPACITY-BUILDING PROGRAM ON IP:

It is a building plan for PI at the intermediate level in Medellin that supports the consolidation of the science, technology and innovation system, and strengthens participants in their knowledge, capabilities, and abilities necessary for the management of IP assets generated in organizations / institutions / companies to increase their competitiveness.

PERSONALIZED SUPPORT PROGRAM FOR BUILDING SUCCESSFUL CASES ON INTELLECTUAL PROPERTY:

It is a process of knowledge transfer and advice that facilitates proper diligence of IP assets to ensure implementation in the identified technology market, building success stories, and generating institutional capabilities for managing these assets of intellectual property for the domestic and international markets.

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BUSINESS OF KNOWLEDGEIt aims to work jointly with local, national and international companies, as well as high-value entrepreneurs and smart capital sources for innovative business consolidation to boost the competitiveness of Medellin.

In order to achieve this objective, we work from three main areas:

MARKET ACCESS: To support entrepreneurs and innovative companies in developing the business model, in its strategic direction to create value, and the construction of management capabilities and techniques that give them access and guidance to national and international markets. It also seeks to develop capacities, support and management of specialized niche markets in value-added products and technologically advanced.avanzado.

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RUTA N ACCELERATION PROGRAM: This program seeks to transform the results of successful research and initiatives with high growth potential of the city of Medellin in sustainable business and global realities, in partnership with other players in the Regional Innovation System.

FOUNDER PROGRAM: It is an alliance with the Founder Institute in Silicon Valley to connect high-potential digital entrepreneurs with global ecosystem of start-ups for the creation and consolidation of technology companies.

The Founder Institute is an accelerator for digital companies, where the Internet is a central part of their business model. As a technological hotbed, the Institute works on the creation and consolidation of 600 companies per year, in 30 cities around the world. The program identifies high-potential entrepreneurs and then guides them through weekly sessions on starting a business. It is a work that is done in conjunction with over 400 expert mentors and business leaders.

DIGITAL ENTERTAINMENT STRATEGY:

It seeks to help strengthen the industry through technical training, and the consolidation of talent in the areas related to animation, video games, special effects, and convergent media.

PROGRAMA APPS.CO

Programa de aceleración realizado en alianza con MinTic que apoya a las empresas TIC interesadas en mejorar su capacidad interna para crear valor, escalar su negocio y consolidar una estrategia de crecimiento sostenido en el tiempo, a través de un acompañamiento especializado para las empresas en cuanto al modelo de negocio, la consolidación del equipo de trabajo, la preparación para la búsqueda de inversión de capital de riesgo, el apoyo en la celebración de alianzas estratégicas y la presentación a posibles clientes y usuarios claves.

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ACCESS TO CAPITAL: It seeks to strengthen and encourage capital vehicles to invest in the knowledge business; furthermore, it provides information, contacts and services for companies to find partners and funding sources for their innovative initiatives, in its various stages of development.


INNOVATION FUND OF SEED CAPITAL: The Municipality of Medellin, through Ruta N, promotes the creation, structure and operation of a seed capital fund. The objective of this fund is to serve as a source of funding for technology-based enterprises with high growth potential in the city of Medellin, under a model of a private-equity fund in the early stage of maturity of these ventures.

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GENERATION OF BUSINESS CAPABILITIES FOR INNOVATION: This axis aims to develop the platforms and conditions necessary for the management of innovation, and the acquisition and development of knowledge becomes a differentiator strategic asset in businesses of the city. It promotes innovation as a process, which managed properly and consistently, can constantly deliver results in time.

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INNGENIO:

It is a program that seeks to encourage and support the development of products, defined as goods, services or processes that arise from business initiatives with a view to the market, from incentives, including financial resources and strategic advice, as a mechanism to strengthen the competitiveness of companies in the city.

INNOVATION MANAGEMENT:

It seeks that companies acquire knowledge in innovation management, with a strategic process to strengthen its competitiveness in a coherent fashion with its corporate strategy, and a clear process of innovation culture within their organization.

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MARKETING AND COMMUNICATIONS MANAGEMENT POST Its work is accompanying permanently the processes of creation and brand positioning or branding, as well as the release and the communications consultancy in all areas of the institutional work to help achieve the strategic mission of the Corporation.

Its biggest challenge is to position Ruta N as the entity of the Municipality of Medellin and its companies, EPM and UNE, which is responsible for leading public issues of science, technology and innovation and legitimize the corporation within the ecosystem of these areas of knowledge, both locally and nationally, and internationally.To achieve its mission, the Marketing and Communications Management Area has different strategies aimed at specialized audiences, and the wider community in which they generate spaces of reflection with experts.

Moreover, realizing the importance of having a permanent contact with all publics, Ruta N web portal, driven from this management area, provides information on the work of the corporation, and content and news, on issues related to science, technology and innovation that contribute to build that city, which is being promoted.

ADMINISTRATIVE AND FINANCIAL MANAGEMENT AREA Like any organization, Ruta N has an area that is responsible for human resources, administrative and financial resources, to carry out its work and manage the contributions that the Mayor’s office of Medellin, EPM, and UNE, been assigned for the development of Ruta N’s mission.

The Administrative and Financial Management Area maintains control over the money received by the corporation, managing it efficiently and responsibly. It also performs administrative and human resources activities necessary to keep our promise to the city and to show management and balance sheets of all that is done for science, technology and innovation.

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All programs, strategies and activities that have been led from Ruta N in the past year have contributed undoubtedly to the construction of an increasingly innovative Medellin. Thus, following we will present the main achievements of the Corporation in 2012.

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STI PLAN: THE BEGINNING OF A NEW NORTH

One of the most important achievements that the plan had in 2012, was the support received by the City Council, by unanimously passing the Agreement 24 of 2012, by which the 2011-2021 STi Plan is adopted as public policy for the development of innovation in the city, and allocates resources to co-finance at least 7% of the resources given to the municipality annually by EPM from their ordinary surpluses starting from 2013; funds equivalent to COP$ 417,000 million in the period 2013-2021.

Additionally, by the end of 2012, the macro-project “Development of solutions in STi for the Health sector in Antioquia was approved with resources from the Science, Technology and Innovation Fund of the National Royalty System for COP$25.000 million and a total amount of COP$42.000 million.

FIRST FUND OF SEED CAPITAL FOR INNOVATIVE COMPANIES

The Municipality of Medellin, through Ruta N, promotes the creation, structure and operation of a fund of seed capital as lead investor, committing resources by COP$5,000 million pesos.

The objective of this fund is to serve as a source of funding for technology-based enterprises with high-growth potential in the city of Medellin under a model of a private-equity fund in the early stage of maturity of these ventures, with a range of investments between COP$ 200 and $ 1,000 million pesos.

The fund, which is managed by the firm, Velum Ventures, aims to make the scaling of functional prototypes, concept testing, market testing, and the protection of intellectual property and the corresponding negotiation.

It will also covers working capital and asset acquisitions for ventures up to a stage where their validation and market potential is demonstrated.

This fund is intended to close a gap in the access to smart capital for technology-based entrepreneurs in the city of Medellin, and during 2013, it will be in the stage of resource rising for final closure and operation.

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A TECHNOLOGICAL DISTRICT FOR THE CITY OF KNOWLEDGE

The project, Science and Technology District, is part of the Development Plan “Medellin a home for life” which in its Line 3, ‘Economic development for competitiveness,’ has designated Ruta N as the leader of the formulation stage.

During 2012, conceptualization workshops of the district were held with key players of the city as the Mayor’s office, the University of Antioquia, the EDU, Isvimed, and ACI, and MIT experts.

Similarly, a contract of the district’s model transfer was signed between the City Hall of Barcelona (which conceptualized the 22@ District) and the city of Medellin, through the ERICA agreement. This transfer began in November with the first mission of experts from the City of Barcelona to Medellin.

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• Staunch Robots: It is a software-development boutique in Ruby on Rails, comes from Maryland, United States, and began in October with four jobs and now has 10.

• Instiglio: A Harvard student company that makes innovation programs from the resources of social responsibility of private companies. It currently holds six jobs.

• MSH Group: A U.S. company specializing in recruitment for technology companies. To date, it has 14 jobs.

• Velocity Partners: A company originating in the USA that specializes in software development.

INTERNATIONAL COMPANIES THAT HELP TO LEVERAGE THE LOCAL PROGRESS

By the end of 2012, and thanks to the release of the Landing strategy, the Ruta N complex has seven international companies settled that generate 69 jobs:

• Lex Paradigm: From Philadelphia, USA, develops software for handling large data packets in the publishing industry. The company joined the program in June 2012 with 10 people and now has 14 people.

• Sproutloud: It entered the program in September with 11 people, coming from Miami and develops software for managing online marketing resources.

• Tairo: This Company from Barcelona, Spain, entered the program in June with four jobs and does consulting for the design of Smart Cities.

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NINE INNOVATIVE PROJECTS, THE LEGACY OF INNGENIO 2012

In partnership with the Israeli consulting firm, Penza Group, 14 companies of Medellin and the Aburra Valley belonging to the six strategic clusters in the region, actually implemented the model for product development, Design Thinking.

Companies that were trained in methodology were: Organic Evolution, Industrias Haceb S.A., Endevor Ingeniería S.A.S., MVM Ingeniería de software S.A., Acceso Virtual S.A.S., Quatio S.A.S. and Massol S.A.S. Additionally, during the process the institutions, Ecoefficient Corporation, University of Medellín, CES University, and CIDET acted as allies of the companies, and also received training.

Finally, with financial support of about COP$900 million, nine participants performed the project design phase and the construction of prototypes with the corresponding market and quality testing. These companies worked with a special effort to achieve a result that leaves a structured business plan and a prototype in a state close to market launch.

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A BOOST TO DIGITAL COMPANIES The Founder Institute program in partnership with Ruta N concluded after 16 weeks of work, and left as a result the creation of four new digital businesses.

With the support of 24 national and international mentors with extensive experience in the construction and consolidation of companies able to compete globally, the 16 participants who joined the program strengthened their business ideas and tested them to meet actually the market requirements.

Of this group of entrepreneurs, six graduated from the program and presented their new digital businesses:

• Tuttores: a venture of Daniel Morales and Juan Camilo Buitrago Perez. It helps parents, and students find tutors. It offers quality, order, and confidence in the service, presenting an organized and complete profile of the tutor.

• La Bonoteca: Developed by Tomas Posada. It is a postpaid coupon redemption system (redeemed after purchase), through mobile devices, enabling them to merchants drive traffic and sales. One of the great advantages of this product is that it is always available to all users when they need it. The application has been downloaded thousands of times and obtained funds by COP$341.5 million when it won the summoning of seed capital of Innpulsa Colombia. • Inteldata: An idea developed by Esteban Perez and Jared Quiroz. This company offers to improve the process of diagnosing diseases by using new technological tools.• Likrs: A venture of Omar Gomez. This is a social aggregation service that groups, classifies and searches efficiently all ‘likes’ of social networks.

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MEDELLIN BELIEVES IN THE DIGITAL ENTERTAINMENT INDUSTRY

Being a center for the development of the digital entertainment industry is one of the main objectives that Ruta N is willing to meet in the coming years.

So, in 2012, the corporation has worked hard to develop significant projects that allow furthering consolidating the digital entertainment strategy.

• Medellin will have its ViveLab: the Mayor’s office of Medellin, with the Ruta N Corporation was within the Bank of Viable Projects of the Summoning 585 made by the ICT Ministry’s ViveLaB. The ViveLab is a space where people will access technologies of information and communications (ICT) for technical training in digital content production, development of applications for SEMs, and development of venture projects in this sector.

In 2013, it started its operation with an investment of approximately $ 1,300 million pesos in infrastructure, to provide this space with the latest technology for training and development of digital content.

• Workshops that promote our local talent: In the year, there were two workshops, one with Alexandre Mandryka, international expert in video game design, and another with Mauricio Garcia, who lectured on the processes and methodology for animation in Colombia. In total 250 people and eight companies were trained in video game animation and convergence.

• Jar Dwellers: The first international series produced in Medellin. We signed a partnership between Pipeline Studios, the Canadian and Australian governments, and the support of Ruta N and Telemedellín. In 2013, a team of 35 artists will participate in the production of the first animated series for international television in Medellin.

Tomás Posada,CEO La Bonoteca

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KNOWLEDGE MANAGEMENT FOR BUSINESSES IN THE CITY

Accompanied by the ally entity Idélaboratoriet, of Sweden, we were able to integrate nine companies, between large and medium size, to start building an innovation management model focused on organizational culture change to identify, conceptualize, and develop projects, which aimed to mitigate the operational weaknesses or of market of each company, and the value chain between suppliers and customers.

The affiliate companies are: Grupo Argos, UNE Telecomunicaciones, Laboratorios Ecar, HMV Ingenieros, Integral, Edatel, Fabricato y Sumico.

WORLD-CLASS TECHNOLOGY COMMERCIALIZATION IN MEDELLIN

This program, led by the IC2 Institute at the University of Texas at Austin, allowed 65 people, universities, institutions and companies, create or strengthen the competencies needed to execute efficiently knowledge transfer processes, and their transformation into new business of high added value and global reach.

During this process, the “co-processed microcrystalline cellulose” which utilizes this component to be used as raw material for the pharmaceutical, cosmetic and food industries, won an internship at the IC2 Institute facilities in Austin (Texas) where they held meetings with experts and international investors.

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PROGRAM OF TECHNOLOGICAL SURVEILLANCE AND COMPETITIVE INTELLIGENCE

During 2012, there were two versions of this program under the Erica Program, and in partnership with the Polytechnic University of Valencia. Nearly 89 representatives from eight universities, and 20 companies, received training to strengthen institutional capacities in the field. The program accompanied the colleges, and technical and technological institutions, seeking to develop their capabilities through research groups, technology transfer offices and other facilities, with a focus on appropriation and replication of knowledge.

MORE PROFESSIONALIZATION OF INTELLECTUAL PROPERTY

During 2012, the program of intellectual property was divided into four sub-programs, seeking to impact different audiences, as follows, IP Clinic, Program of Awareness in intellectual property with international experts, Program of capacity-building in IP, and Program of personalized support for building success cases in intellectual property.

In the development of these programs, we were able to have as allies Colciencias, Tecnnova, and the National Institute of Industrial Property of Brazil, which facilitated the implementation of mentoring to 56 professionals and 27 institutions.

In total, the program had the support and advice of 20 national and 10 international experts, and we identified 26 potential technologies.

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EVENTS AND PROGRAMS THAT DRIVE INNOVATION CULTURE IN THE CITY

• Innovation Week: In 2012, under the theme “Culture of innovation: the path of smart cities,” 15 public and private partners joined for the first time to the completion of the Innovation Week, managing to have an academic and cultural offer of over 20 city events, which had the participation of 15 experts international speakers, and 19 important domestic guests and entrepreneurs.

Some 7,000 people and a virtual audience of 2,000 persons, who were connected by transmission via streaming in other areas of the department and the country, thanks to Publik, Telemedellín Teleantioquia, attended the events of the Innovation Week.

• Startup Weekend: For 54 hours, a group of about 100 people made up by software developers, graphic designers, and

business persons, among others, formed 16 teams to which, from an idea or a market need, create a Web application or Mobile, which will serve as a possible basis for the emergence of a new Internet-based company.

This activity, which included the participation and advice of two international experts as TA McCann, Vice President of product strategy at RIM - Research In Motion (Blackberry) - and Aswhin Navin, cofounder of BitTorrent Inc, and I / O Ventures, led the networking and community building among businesses and young entrepreneurs about innovation and entrepreneurship in ICT.

Alertab and Graffiti were the two business ideas winning the contest, and they had the opportunity to participate in the program of acceleration with the Founder Institute, and the Intellectual Property Workshop, both led by Ruta N. Additionally; they had the accompaniment from Park E, marketing advice by the UPB, Internet domain mapping, and visibility before the international community of Start companies like Intel, BMW, Asus, Corning, among others.

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The first place went to the video clip made by Juliana Ospina Henao, who was the recipient of a trip to Segovia, Spain, to receive from 3D Wire, an instruction course in Mistika, a post production program for stereoscopic (3D) that was used in the films Tintin and the Hobbit. Second place went to Yellow Bulb, a team that traveled to Argentina to participate in the International Festival of Animation “Expotoons 2012.”

• Solar Challenge: The second version of Medellín Solar Challenge, led by the Mayor’s office of Medellin, EPM, Ruta N, Parque Explora, the Government of Antioquia and the Discience Foundation, sought that public and private schools in Medellín - and starting with this version, the department - would participate in a competition that brought innovation and joint work for building a car that would work on solar energy.

On July 14, 2012, in the Parque de los Pies Descalzos, 305 teams in the metropolitan area, and 52 regions of the department with 610 youngsters and 305 teachers, gathered to carry out the competition. The first place went to the Colegio Gimnasio los Alcázares of the municipality of Sabaneta, with its team Pheibos, which received a reward consisting of an expedition – all expenses paid - to the South African Solar Challenge 2012 in September. They had the opportunity to share with the event organizers the projects being conducted in Medellín regarding solar vehicles, and also made contacts with specialists in the construction of these vehicles.

Awards to innovation in the Science, Technology, and Innovation Fair: In 2012, the Science Fair, led by Secretary’s office of Education and the Parque Explora, joined the celebration of the Innovation Week.

During this fifth edition of the Fair, Innpulsa Colombia Ruta N rewarded in the new category, “Innovation Awards,” those projects that made the difference for their creativity and innovation.

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As a result of the process, three winners were chosen:

• Project: “Vibrasor”Students: Isamar Cartagena and Katherine Fernández of the School, Juan N. Cadavid of Itagüí.Description: Design and construction of a device that emits a light and vibrating signal when it captures the sounds of cars and motorbikes’ horns. The system works through a handle, and is made to help people with hearing disabilities, have a faster reaction time to the danger on the streets.

• Project: “Intelligent Software”Students: Laura Betancur and Santiago Arboleda Francisco Restrepo Molina High School of Envigado.Description: Technological advancement to diagnose diseases such as Alzheimer’s.

• Project: “Húmex” Students: Valentina Nieves, Julián Parra, Paula Andrea Rivadeneira and Anderson Clavijo of the Juan N. Cadavid School of Itagüí.Description: Development and implementation of an intelligent device that contributes to quality control in coffee storage.

They all had the opportunity to have a scientist mentor who is responsible for giving them personalized guidance on scientific topics of interest to young people, and also they participate in excursion or an international or domestic science camp.

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• Research Prizes - Mayor’s office of Medellin Research Awards, in its seventh year, delivered stimuli for COP$ 175 million to the winners of the summoning for 2012. Individuals or groups recognized this year, received two awards of COP$ 25 million for the ‘Research for Greater Impact from 2011 to 2012’, ten prizes of $ 10 million for undergraduate research students, and a prize of $ 25 million for the ‘Ruta N Award to Innovation. ‘

This time Ruta N, a strategic partner of the awards, launched the “Innovation Award in Energy representative in Energy, Health, or ICT”. This category granted a financial incentive worth $ 25 million to the project “Development and evaluation of a crucible furnace of high thermal efficiency” of the Group for Science and Technology of Gas and Rational Use of Energy - GASURE - University Antioquia, whose coordinator and principal investigator is Andres Adolfo Amell Arrieta.

• EmTechThanks to the support, sponsorship, and partnership of the Mayor’s office of Medellin, Ruta N, EPM, the Ministry of ICT, UNE, Innpulsa Colombia, Telemedellín, Digital Medellín, ESU and Plaza Mayor, the MIT’s Technology Review magazine chose the city of Medellin to host of the first in Latin America EmTech conference, an event that seeks to expose the most important emerging technologies and explaining their impact on the world.

This time, more than 25 international exhibitors visited Colombia to speak to 600 high profile attendees on the latest developments in areas such as energy, health, ICT, mobility, security and smart cities.

In parallel, the TR35 Colombia event was held, seeking a space to recognize the 10 most innovative and brilliant young Colombians, under 35. Likewise, an investment forum was held, where innovative Colombian projects came into contact with a group of venture capitalists, domestic and international.

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COMMUNICATING: THE KEY THAT HELPS POSITION MEDELLIN AS AN INNOVATIVE CITY

From the Marketing and Communications Management Area of the Ruta N Corporation, we have structured a positioning strategy that helps spread and publicize what Ruta N has done, is doing, and plans to do in the future; all with a clear policy of direct approach with target audiences, and in turn, in order for them to feel impacted by the work that the corporation conducts.

Listed below, the main activities:

• From September to November, 2012, in the facilities of the Complex showroom, 21 works were part of the art exhibition “Ecology / Economy, a look at environmental responsibility,” that was held in partnership with the University of Antioquia, and, which involved 18 artists.

• Thanks to a whole media strategy in local and national media, Ruta N Corporation generated free press of about $ 2,315 ‘148 186.

• As part of the approach to the media, and using the framework of the Innovation Week an Innovation Journalism Forum was held, a space to talk about the way in which the media have evolved in recent times. In this second version of the Forum, the participants were the Technology Review magazine in Spanish, Enter.com, lainformacion.com, Ruta N Medellín, and Kien & Ke, and the audience was invited to reflect on the present and the future of information as a generator of knowledge.

• In an effort to raise awareness in the city of the Corporation’s success stories in 2012, we conceptualized, designed, and launched the campaign “If you imagine it, it is possible” as a manifesto to all the things we imagine having, and that thanks to the work of Ruta N they were made possible.

For the launch of this important campaign, we took advantage of the realization of Ruta N-third anniversary event N, which, together with the participation of the band “Systema Solar” and an intervention of a graffiti artist; 700 people came into contact firsthand with the concept “if you imagine it, it is possible” and also they let their feelings towards Ruta N captured in a graffiti.

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MANAGE PUBLIC RESOURCES PROPERLY::GREAT MISSION OF THE ADMINISTRATIVE AND FINANCIAL MANAGEMENT AREA

That is the main focus of this management area, but it also led projects such as:

• Tax incentive program for innovation.In order to encourage the generation of specific innovative activities carried out by the companies in clusters in Medellin, the Agreement 67 of 2010, provides tax benefits in property tax and industry and commerce tax, to companies whose innovative activities fall within the clusters of Textile / Apparel, Fashion & Design, Construction, Business Tourism, Fairs and Conventions, Medical and Dental Services, Technologies of Information and Communications, and Electricity.

Ruta N is the entity that certifies innovation to access these benefits and in 2012, three companies were certified, which belonged to clusters of ICT, Health, and Textiles/Apparel/Fashion.

• Delivery of Tower C to representatives from Hewlett Packard. On September 19, Hewlett Packard opened its building in the Global Service Center in the Ruta N. Initially; they started the occupation of this space with 150 jobs.

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AWARDS AND RECOGNITION

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Biosphere Awareness Award 2012The prize, awarded by the Biosphere Awareness Foundation, José Celestino Mutis, in an agreement made by the city of Cadiz, in Spain, the city of San Sebastián de Mariquita, and the Ministry of Culture of Colombia, is a new recognition of this city project that respects and protects the environment.

In the 2012 edition of the awards, the Ruta N Corporation had a leading role receiving the award in two categories. The first prize, in Sustainable Infrastructure, delivered to the Mayor’s office of Medellin, EPM and UNE “for the management,

design, support, implementation and construction of Ruta N’s headquarters building, designed with sustainable principles harmonious with the environment,” such as stated in the official statement sent by the Mayor of Cadiz, Teofila Martinez Saiz, and the Biosphere Awareness Foundation Award.

The second prize, received in the category Enterprise Performance with Environmental Social Responsibility, for the Science, Technology and Innovation Plan of Medellin, which has its focus on the application development in the energy, health and ICT sectors, which is “conceived as a holistic system of coordination and integration to boost economic development, environmentally sustainable, and socially coherent to bring the habitat in the city.”

“city project that respects and protects

the environment.”

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Medellin, 7 marzo de 2013

To the General Assembly of Associates of the RUTA N CORPORATION MEDELLIN

I have audited the balance sheet of the RUTA N CORPORATION MEDELLINat December 31, 2012 and the related statements of income, changes in equity, changes in financial position and cash flows, the summary of significant accounting policies and other explanatory notes, for the year ending on that date. The financial statements of the Ruta N Corporation dated December 31, 2011 were audited by another CPA that in his report dated March 20, 2012 expressed an unqualified opinion thereon.

Management is responsible for the proper preparation of these financial statements in accordance with principles or accounting generally accepted in Colombia. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and presentation of these financial statements free of errors of material importance, whether due to fraud or error; selecting and applying appropriate accounting policies, as well as establishing accounting estimates reasonable in the circumstances.

My responsibility is to express an opinion on these financial statements based on my audit. I obtained the information necessary to perform my duties and performed my audit in accordance with auditing standards generally accepted in Colombia. Those standards require that I comply with ethical requirements, plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of errors of material importance.

FISCALAUDITOR’S REPORT

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An audit involves performing procedures to obtain evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of errors of material importance in the financial statements. In this risk assessment, the auditor considers internal control relevant to the preparation and presentation of financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the use of appropriate accounting policies, and the reasonableness of the balances and accounting estimates made by management, as well as evaluating the overall presentation of the financial statements in general. I believe that the audit evidence I obtained provides a reasonable basis for the opinion expressed below.

In my opinion, the financial statements referred, faithfully taken from books and attached to this report, present fairly, in all these aspects of material importance, the financial position of the RUTA N CORPORATION MEDELLIN as of December 31, 2012, the results of its operations, changes in its financial position and its cash flows for the year ended on that date, in accordance with generally accepted accounting principles in Colombia, applied uniformly to the previous year.

In my opinion, during 2012:

• The accounting of the Entity has been performed according to the legal regulations and accounting techniques.

• The transactions recorded in the books and the actions of the managers conform to the statutes and decisions of the Assembly.

• There are adequate measurements of internal control, of maintenance and custody of the assets of the Company, and those of third parties, which are in their possession. My comments on the internal control went separately to the administration of RUTA N CORPORATION MEDELLIN and were accepted entirely.

• Correspondence, account vouches, and the minute books are kept and preserved properly.

• There exists an agreement between the financial statements attached, and the management report prepared by the managers.

• The information contained in the statements of settlement of contributions to the Integrated Social Security System, particularly on the affiliates and their revenue base for contribution, have been taken from the accounting records and accounting vouchers. The Company is not in default in respect of contributions to the Integral Social Security System.

• The Entity utilizes software, supported by their corresponding use licenses.

JUAN GUILLERMO SOTO OCHOAFiscal Auditor T.P. 34620-TMember of DAF S.A.S.

JUAN PABLO ORTEGA IPUZ Representante Legal

JUAN GUILLERMO SOTO OCHOARevisor Fiscal TP 34620-TEn representación de DAF

ELIZABETH FLOREZ BERRIORepresentante Legal Contadora TP 125796-TEn representación de CELT Consultores

JUAN PABLO ORTEGA IPUZ Representante Legal


ELIZABETH FLOREZ BERRIORepresentante Legal Contadora TP 125796-TEn representación de CELT Consultores

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JUAN PABLO ORTEGA IPUz Representante Legal


ELIzABETH FLOREz BERRIORepresentante Legal Contadora TP 125796-TEn representación de CELT Consultores

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JUAN PABLO ORTEGA IPUz Representante Legal


ELIzABETH FLOREz BERRIORepresentante Legal Contadora TP 125796-TEn representación de CELT Consultores

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Performance Report 2012

Documents

Transcript of Performance Report 2012