2010 am manual of accounting policies (map)_recovered

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Hmsqnctb shnm Manual of Accounting Policies (MAP) 2010 Updates About the Compliance team About the IFRS Network About the Accounting Update & Reporting Alert About the Accounting Helpdesk Ask the Experts About the IFRS e-learning Certication About the Quarterly IFRS Update Many thanks for your help

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0000 Framework 0100 BPM 0300 Treatment of Changes, Estimates and Errors in accounting policies 0600 Interim nancial reporting

1-@ rrdsr 2.1 Non-current assets

1100 Intangible assets 1150 Property, Plant and Equipment 1160 Service Concession Arrangements 1200 Leases 1250 Asset Retirement Obligation (ARO) 1300 Government grant 1450 Investments accounted for using equity method and other investments 1600 Financial assets 1650 Non current assets held for sale and discontinued operations

2.2 Current assets

1700 Inventories 1750 Stock margin

2-Kh`ahkhshdr 3.1. Shareholder s equity

2000 Shareholders equity 2200 Share-based payments 2300 Non-controlling interests being reviewed

3.2 Non-current liabilities

2400 Long term debt 2500 Pensions and other post employment benets 2600 Provisions for liabilities and charges

3.3 Current liabilities

2700 Trade and other payables

3-Rs`sdldmsnenodq`shnmr

3000 Revenue 3200 Cost of sales 3400 Selling General & Administrative (SG&A) 3500 Staff costs 3600 Impairment being reviewed3700 Net nancial costs 3900 Income taxes

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4100 Off balance sheet commitments

5-Rodbh`k`bbntmshmfhrrtdr

4200 Operating segments 4250 Earnings per share 4300 Business combination under review 4450 C ash ow statement 4500 Effects of changes in foreign exchange rates 4600 Hedge accounting under review4610 Embedded derivatives in purchasing contracts 4650 True Sales of Receivables ( TSR) 4700 Environmental provisions 4800 Related Party Disclosures 4850 Emission rights under review4900 Events after the reporting period

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1- @ rrdsr 2.1 Non-current assets

2.2 Current assets


4- Nee,a`k`mbdrgddsbnllhsldmsr

3- Rs`sdldmsnenodq`shnmr

5- Rodbh`k`bbntmshmfhrrtdr

rgh lwoh xsgdwhv0000 Framework IFRS references

0100 BPM

0300 Treatment of Changes, Estimates and Errors in accounting policies

0600 Interim nancial reporting

rgh lwoh xsgdwhv2400 Long term debt Integration of the Treasury pack; chart

of account updated

2500 Pensions and other post-employment benets

Towers Perrin replaced by Towers Watsonfollowing the merger of Watson Wyatt withTowers Perrin earlier in 2010Update of the chart of accounts

2600 Provisions for liabilities and charges

- Integration of the new threshold(>0,5M$ for details to Conso dept. and additionalexplanations for some accounts (ARO,)- New account created 60223P Voluntary Retirement Scheme for the VRS/ VSS provisions

0600 Interim nancial reporting

rgh lwoh xsgdwhv1700 Inventories - Tax Professional in France: The two

new components of the Tax Pro-fessional effective in France since January 1st , 2010, is closely linked to the industrial activity, based on added value and should be considered for inventory valuation

- Purchasing fees excluded of the SG&A and transferred in COS;

1750 Stock margin New threshold: The buyer should lled inhis tons in stock if the book value ofinventory for a given good shipped fromanother group company exceeds $5M

rgh lwoh xsgdwhv3000 Revenue Update of the Chart of Accounts

3200 Cost of sales (COS) Update of the denitions and the Chart of Accounts

3400 Selling General & Administrative (SG&A)

Update of the denitions, corrections after theFebruary 2010 Conso Instructions

3500 Staff costs Update chart of accounts

3600 Impairment being reviewed

3700 Net nancial costs Explanations of the new schedule in the Treasury pack, Account Banks fees details of the acceptablecomponents

3900 Income taxes Guidance on the accounting of withholding taxesUpdate chart of accounts

rgh lwoh xsgdwhv4200 Segment reporting New presentation of the breakdown by activity (4)4250 Earnings per share

4300 Business combination under review

4450 Cash ow statement IAS 7 Amended, new ow F45 Cash

4500 Effects of changes inforeign exchange rates

4600 Hedge accounting under review

4610 Embedded derivatives inpurchasing contracts

4650 True Sales of Receivables (TSR)

Expenses related to TSR programs should berecoded in the account 651100 (in nancialresult) rather than the account 61202P (in COS)

4700 Environmental provisions

4800 Related Party Disclosures

4850 Emission rights under review

4900 Events after the reportingperiod

rgh lwoh xsgdwhv2000 Shareholders equity Integration of the chart of accounts

2200 Share-based payments

2300 Non-controlling interests Under nal review of the accountingprinciples following IFRS 3R (Revised)

rgh lwoh xsgdwhv2700 Trade and other payables Update chart of accounts

rgh lwoh xsgdwhv4100 OBSC

rgh lwoh xsgdwhv1100 Intangible assets

1150 Property, Plant and Equipment Integration of Mill rolls section accounting treatment (4.10) Update chart of accounts

1160 Service Concession Arrangements

1200 Leases IAS 17 amended & Update chart of accountsThe IFRS Compliance team in the Acounting, Consolidation and ReportingDepartment should be involved as soonas the value of such an arrangement isabove 5M$ instead 7M$ (decrease of thethreshold to align with IAC)

1250 Asset Retirement Obligation (ARO) Update chart of accounts1300 Government grant Update chart of accounts

1350 Mill rolls accounting treatment Procedure deleted and the section hasbeen integrated in the MAP n1150 PPE

1450 Investments accounted for usingequity method and other investments

Updated with the new Chart of Accounts

1600 Financial assets

1650 Non current assets held for sale anddiscontinued operations

Inclusion of changes following issuanceof revised IFRS 5New MAP code (1650 instead of 1900)

2- Khahkhshdr 3.1. Shareholder s equity


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The IFRS Compliance team is part of the Accounting, Consolidation & Re-porting department and is in charge of updating continuously the Manual of Accounting Policies (MAP) in further developing Group accounting policies and homogenising critical accounting treatments within ArcelorMittal group.

The roles of compliance team are to: - Promote a strong IFRS culture; - Follow the evolution of new IFRS standards or IFRIC interpretations; - Check the application of the MAP procedures, alerts and guidances in

the whole group; - Develop new accounting policies for critical accounting issues; - Update continuously the Chart of Account (CoA); - Centralise the recurrent questions in the Accounting Helpdesk; Ask the

Experts.

The Manual of Accounting Policies (MAP) is divided in 4 main parts covering the main topics of the nancial accounts: assets, liabilities, statement of operation and special accounting issues.

The objectives of the MAP are to: - Create the conditions of a consistent application of AM accounting

policy throughout all the units - Give clarity to the duties and tasks of the Finance functions; - Give an overview of the policies and procedures governing the business

that are part of the accountability of compliance; - Make it possible to train new accounting staff using the MAP procedu-

res as training documents;

In order to centralise the questions from all units, the compliance team has created the Accounting Helpdesk. The application allows all members of Group to receive accurate answers to their accounting questions in a 5 days delay (maximum depending of the nature of the question) and to consult the FAQ database of the application.

The members of the compliance team and their related responsibilities are the following:

Nayla Germani-Coel - Liaise with regulatory bodies and professional organizations for new co-

ming standards and board discussions- Accounting & Reporting Alerts- Accounting Helpdesk

Marie-Claude Proulx- Trainings IFRS & BPM- Accounting Update- Accounting Helpdesk- IFRS Network

Laurent Schumacher- Chart of Accounts (CoA)- MAP and pocket guide- IFRS Network

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To support the Compliance team in the most efcient way, the Group has created an IFRS Network of geographical representatives who provides a channel for discussion and communication of local issues to Group level and for implementation and guidance of Group accounting policies at local level.

On the short term, the ArcelorMittal IFRS Networks efforts have been dedi-cated to write the ArcelorMittal Manual of Accounting Policies (MAP) issued in the BPM Collaboration portal and applicable as at January 2008.

On a medium and longer term, the Network will be active in running IFRS training programmes and will be a direct consultative channel for operating units and segments.

The ArcelorMittal IFRS Network is currently composed of approximately 35 members, selected for their accounting experience and IFRS expertise, representative of the following key geographical areas: Argentina, Belgium, Brazil, Canada, Czech Republic, France, Germany, Kazakhstan, Luxembourg, Mexico, Poland, Romania, South Africa, Spain, Ukraine and United States of America.

COUNTRIES MEMBERS COUNTRIES MEMBERS

ARGENTINAMaria Jose

BONADONNACatalina LANCIANO

SOUTH AFRICA Suretha van WIJKGavin GRIFFITHS

BELGIUM Frederic LEMAITRE Lieve LOGGHE SPAIN

Marcos MAQUINAY Miguel ORNIA

BRAZIL Alexandre BARCELOSBruno Paim PARREIRA UKRAINE

Andriy KOLOMIETS Ashok SONTHALIA

CANADA Steve ELJUGAEric TOMLINSON USA

Paul HUBLINGNeil JOHNSTON

CZECH REPUBLIC Suyash PRADHAN

FLAT CARBON EUROPE SEGMENT

Axel BILHARZ

FRANCE Patrick ARMENOULTLONG CARBON

EUROPESEGMENT

Arnaud JOURON(member to be appointed)

GERMANY Ralf KRENZTom SONNTAG

STAINLESS SEGMENT

Guillaume BAZETOUX (member to be appointed)

KAZAKHSTAN Arun SOMANIARCELORMITTALDISTRIBUTION & SOLUTIONS

Marie-Francoise TERLIER(member to be appointed)

MEXICO Jorge TORRESHarish SHARDA

ARCELORMITTALSOURCING Serge NENNIG

POLAND Adam PREISSLukasz SKORUPA

LUXEMBOURG(Group

Accounting, Consolidation & Reporting)

Genuino CHRISTINO Christophe JACAMON

Ramesh KOTHARI Frederic LANG

Rogerio ASSUNCAO Nayla GERMANI-COEL Marie-Claude PROULX Laurent SCHUMACHER

ROMANIA Valentina GHINOIU

JdxbnmsbsodnokdMarie-Claude PROULX (Accounting, Consolidation & Reporting)Laurent SCHUMACHER (Accounting, Consolidation & Reporting)

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Cdrbqhoshnm The Accounting update informs the group on new accounting and re-

porting development . The main purpose of this communication is to stay aware of new and upcoming IFRS standards and evaluate by anticipation the impact within the group. The following main subjects have been trea-ted trough the last issues:

Accounting update n1 (September 2007) - IFRIC 10 Interim nancial reporting and impairment - IFRIC 11 Group and treasury share transactions - Borrowing costs (2009) - Operating segments (2009)

Accounting update n2 (February 2008) - MAP (Manual of Accounting Policies) - IFRS 7 Financial instruments (disclosures) - IFRIC 12 Service concession arrangements - IFRIC 13 Customer loyalty programs

Accounting update n3 (July 2008) - IFRS knowledge Network meeting in South Africa - Balance Score Card (BSC) - Accounting Helpdesk, New guidance

Accounting update n4 (December 2008) - Accounting Helpdesk, Alerts, - IFRS Knowledge Network meeting in Brasil - 3 new MAP Procedures - New guidance (IAS 1, IAS 23, IAS 19 (amendment), IFRIC 17)

Accounting update n5 (June 2009) - Did you know ? - Alerts - Interesting questions - Accounting community of ArcelorMittal

Accounting update n6 (October 2009) - BPM trainings, - MAP Pocket guide 2009 - Interesting questions from the tools Ask the Experts - Accounting community, spotlight on ArcelorMittal South Africa

The Accounting and Reporting Alert is issued when needed and concerns onlyone particular accounting topic that needs to be highlighted to the group.

Reporting Alert #01-2008 (June 2008)Subject : Onerous (loss-making) contracts

Reporting Alert #02-2008 (October 2008)Subject : Useful lives Steel plant

Reporting Alert #03-2008 (November 2008)Subject : Restricted cash and escrow accounts Steel plant

Reporting Alert #04-2008 (December 2008)Subject : Inventory Net Realisable Value

Reporting Alert #01-2009 (February 2009)Subject : Net Realisable Value, Onerous contracts provisions & their reversal

Reporting Alert #03-2009 (June 2009)Subject : - Inventory - Net Realisable Value (NRV)- Impairment testing of long-lived assets- Bonus 2008 Accounting treatment- Repairs & Maintenance costs- Employees on temporary lay-off- VRS / VSS and Employee benets

Reporting Alert #04-2009 (August 2009)Subject : Provision for obsolescence of slow moving Inventory : spare parts

Reporting Alert #05-2009 (November 2009)Subject : Preparation of the year-end closing (VRS/ VSS, Impairment , Legalreorganization, 2008 Bonus, Branding fees, Employee benets, Stock-options)

Those documents are sent by e-mail (pdf les) based on the people regis-tered in Clara application and archived on the BPM Collaboration portal.

https://www.myarcelormittal.com/ bpmportal/ BPM Collaboration Portal > Accounting Alert & Update

Jdxbnmsbsodnokd For the Accounting Update: Marie-Claude PROULX (Accounting, Consolidation & Reporting) For the Reporting Alert : Nayla GERMANI-COEL (Accounting, Consolidation & Reporting)

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Cdrbqhoshnm In order to centralise worldwide questions and to ensure the constant

application of the different procedure, the compliance service has created the Accounting Helpdesk. The application allows all members of the group to receive accurate answers to their accounting questions in a ve days delay and to consult the FAQ database of the application. The software has been developed internally and the Network has a consultative role in the application as the questions are redirect/assigned to the Network expert of that specic area.

@bbdrr This application is available on the BPM Collaboration portal in the section

Ask the Experts.

Eqdptdmskx@ rjdcPtdrshnmrE@P All questions that are of general concern to the group will be posted on

the FAQ database of the application after an update of the MAP. All users that have an access to the portal will be able to access the application and the FAQ database.

Mdvrkdssdqrtarbqhoshnm On a weekly basis, the system will send a summary of all the new ques-

tions asked during the week. Each user can subscribe to the newsletter through the application and chose the topics he/she wants to be updated on.

All information regarding the newsletter can be found under My prole through the application.

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Eq`ldvnqjAs global capital markets become increasingly integrated, many countries are moving to International Financial & Reporting Standards (IFRS). For example, most European Union countries use IFRS for nancial reporting and many other countries around the world already require IFRS as their local nancial reporting standards. Moving forward, other countries such as United States, Japan, Korea and Canada are also planning IFRS convergence during the upcoming years.

Deloitte has developed high quality e-learning modules on IFRS which are available at the following link: kwwszzzghorlwwhliuvohduqlqjfrpuhjlvwudwlrqdvs This training does not only explain you IFRS standards but also gives you the opportunity to practice and apply these principles through cases studies and a nal quiz .

At the end of each module youll be given the possibility to print a certicate (in case you score at least 70%). Please scan your certicate and send it to Finance Academy : [email protected]

Additionally, e-learning based on the MAP will soon be available. Those modules will focus on AMs thresholds, accounting policies, chart of accounts & ows, etc. At the end of each section, a small quiz will be added to ensure your correct understanding of the procedure. These modules will be available at the end of the year on the BPM Collaboration portal.

JdxbnmsbsodnokdMarie-Claude PROULX (Accounting, Consolidation & Reporting)Nayla GERMANI-COEL (Accounting, Consolidation & Reporting)

JdxbnmsbsodnokdMarie-Claude PROULX (Accounting, Consolidation & Reporting)Vera ALVES (Finance Training & Development Project Ofce)

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These quarterly updates are organized in Luxembourg together with PwC . They cover the recent discussions at the IASB level and are followed by a Q&A session. Last sessions covered:

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Emission Trading SchemesInventory and CapacityImpairment TestingA selection of IFRS hot topics: IFRS 7 (Amendment) - Financial Instruments: Disclosures, Exposure Draft (ED) on Consolidated Financial Statements, ED on Joint Arrangements, IAS 19 - Employee Benets, ED on Income TaxesED on Leases, Discussion Paper (DP) on Revenue Recognition, ED on Fair Value Measurement .

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IFRS estimated to be published in 2009 Financial instruments: Classication & Measurement Liabilities - Amendments to IAS 37 Current projects to be published later than 2009 Derecognition: presentation of ED + summary of comment letters received Extractive activities: presentation of draft of DP posted Annual improvementsFeedback and summary of comment letters received on the following projects ED on Income Taxes - Comments received until July 31, 2009 DP on Leases - Comments received until July 17, 2009 DP on Revenue Recognition - Comments received until June 19, 2009

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Revamping IAS 39: IFRS 9, Financial Liabilities: where do we stand? Amor-tised cost and impairment EDIAS 24R : Relaxed related party disclosures Status of some IASB projects: Cash ow presentation, Liabilities, Consolida-tion, Derecognition, Leases

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International Accounting Standard 19 - Employee BenetsIFRIC Updates on Stripping CostsUpdate on IASB and IASB/ FASB joint projects: Financial instruments Where are we? Timetable, phases 2 & 3, nancial liabilities, Non-nancial liabilitiesIn the spotlight : Leases, revenue recognition, consolidation, nancial state-ment presentation, statement of comprehensive income, fair value measu-rements,

Material for these Updates can be found on the BPM Collaboration portal at the following address: BPM Collaboration Portal > Manual of Accounting Policies (MAP) > IFRS Update PwC

Similar initiatives with PWC are being developed at country level (Brazil, Ca-nada, Germany, Poland, Ukraine, USA, South Africa. For further information, please contact your respective IFRS Network member.

These sessions can be also joined by call. For further information on this program, please contact :- Marie-Claude PROUL X (Accounting, Consolidation & Reporting) or- Nayla GERMANI-COEL (Accounting, Consolidation & Reporting)

dq|wkdqnviru|rxukhosThe issuance of the Manual of Accounting Policies has been realized thanks to the efforts of the ArcelorMittal IFRS Network, the Group Performance Management, Tax, Treasury and the Group Accoun-ting, Consolidation teams

Many thanks for the people who actively participated to draft , amend, re-view and validat the Manual:

Rogerio ASSUNCAO Franck BETH Gilles BIEDERMANN Genuino CHRISTINO Calogera CLOSSET Steve ELJUGA Nayla GERMANI-COEL Veronique GOBIN Gavin GRIFFITHS Paul HUBLING Jean-Franois HUGO Christophe JACAMON Christophe JUNG Ramesh KOTHARI Frederic LANG Thierry LEJEUNE Frederic LEMAITRE Elsa MORALES Serge NENNIG Kamil NOVAK Marie-Claude PROULX Yurika SATO Laurent SCHUMACHER Jorgen SPIETAEL Amine THAMINY Eric TOMLINSON David VEYSSET Robert VROKLAGE Emmanuel ZIANE

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Notes:

Manual of AccountingPolicies (MAP)

N 0000

This procedure is strictly condential and is for internal use of ArcelorMittal. Only ArcelorMittalstaff may have access to this procedure. No copy of it can be given to somebody outside ArcelorMittal without the written aproval of the designed responsible person. The divulgationof this technical note without the appropriate will be considered as an improper conduct .

Framework

March2010

Contents

0,NAIDBSHUD 2

1,OTQONRDNEEHM@MBH@KRS@SDLDMSR 2

2,BNLONMDMSRNEEHM@MBH@KRS@SDLDMSR 2

3,NUDQ@KK@BBNTMSHMFONKHBHDR 3 4.1 Compliance with IFRS 4 4.2 Going concern 4 4.3 Accrual basis of accounting 4 4.4 Consistency of presentation 4 4.5 Materiality and aggregation 4 4.6 Offsetting 4 4.7 Comparative information 4

4,PT@KHS@SHUDBG@Q@BSDQHRSHBRNEEHM@MBH@K,RS@SDLDMSR 3 5.1 Understandability 4 5.2 Relevance 4 5.3 Reliability 4 5.3.1 Substance over form 5 5.3.2 Neutrality 5 5.3.3 Prudence 5 5.3.4 Completeness 5 5.4 Comparability 5

5,L@MT@KNE@BBNTMSHMFONKHBHDRL@O( HM@QBDKNQLHSS@KFQNTO 4

Page 2

Presentation

Page 3

0,Naidbshud

The objective of this procedure is to describe the ArcelorMittal group accounting policies.

ArcelorMittal group prepares its nancial state-ments in accordance with International Financial Reporting Standards (IFRS), as adopted by the European Union and as issued by the Internatio-nal Accounting Standards Board.

International Financial Reporting Standards are Standards and Interpretations adopted by the International Accounting Standards Board (IASB).

They comprise:

- International Financial Reporting Standards;- International Accounting Standards; and- Interpretations originated by the International

Financial Reporting Interpretations Committee (IFRIC) or the former Standing Interpretations Committee (SIC).

All the procedures included in this Manual of Accounting Policies (MAP) apply as at 01/01/2008.

1,OTQONRDNEEHM@MBH@KRS@SDLDMSR

Financial statements are a structured repre-sentation of the nancial position and nancial performance of the group. The objective of ge-neral purpose nancial statements is to provide information about the nancial position, nancial performance and cash ows of the group that is useful to a wide range of users in making econo-mic decisions.

Financial statements also show the results of managements stewardship of the resources entrusted to it . To meet this objective, nan-cial statements provide information about the groups:- assets;- liabilities;- equity;- income and expenses, including gains and

losses;- other changes in equity; and- cash owsThis information, along with other information in the notes, assists users of nancial statements in predicting the groups future cash ows and, in particular, their timing and certainty.

Furthermore, the preparation of nancial state-ments in conformity with IFRS recognition and measurement principles requires the use of esti-mates and assumptions that affect the reported amounts of assets and liabilities and of revenues and expenses.

Group management reviews its estimates on an ongoing basis using currently available informa-tion. Changes in facts and circumstances may result in revised estimates, and actual results could differ from those estimates.

2,BNLONMDMSRNEEHM@MBH@KRS@SDLDMSR

The complete set of ArcelorMittal nancial sta-tements comprises:

- a statement of nancial position;- a statement of operations and other comprehensive income (OCI);- a statement of changes in equity showing

either : - all changes in equity, or - changes in equity other than those arising

from transactions with equity holders acting in their capacity as equity holders;

- a cash ow statement ; and- footnotes, comprising a summary of signicant

accounting policies and other explanatory notes.

,NUDQ@KK@BBNTMSHMFONKHBHDR

4.1 Compliance with IFRS

ArcelorMittal nancial statements comply with IFRS because they comply with all the require-ments of all the IFRS standards adopted by the European Union and issued by the International Accounting Standards Board.

The application of the IFRS, with additional disclosure when necessary, is presumed to result in nancial statements that achieve a fair presentation.

4.2 Going concern

When preparing nancial statements, Arcelor-Mittal s top management makes an assessment of the groups ability to continue as a going concern.

Financial statements are prepared on a going concern basis.

When management is aware, in making its assessment , of material uncertainties related to events or conditions that may cast signicant doubt upon the groups ability to continue as a going concern, those uncertainties are disclosed.

4.3 Accrual basis of accounting

The ArcelorMittal group prepares its nancial statements, except for cash ow information, using the accrual basis of accounting.

4.4 Consistency of presentation

The presentation and classication of items in the nancial statements are retained from one period to the next unless:

- it is apparent , following a signicant change in the nature of the groups operations or a review of its nancial statements, that another presentation or classication would be more appropriate having regard to the criteria for the selection and application of accounting policies

- a Standard or an Interpretation requires a change in presentation.

4.5 Materiality and aggregation

Each material class of similar items are presented separately in the nancial statements.

Items of a dissimilar function are presented separately unless they are immaterial.

Applying the concept of materiality means that a specic disclosure requirement in a Standard or an Interpretation need not be satised if the information is not material.

4.6 Offsetting

Assets and liabilities, and income and expenses, are not offset unless required or permitted by a Standard or an Interpretation.

It is important that assets and liabilities, and income and expenses, are reported separately.Offsetting in the statement of operations or the statement of nancial position, except when offsetting reects the substance of the transac-tion or other event , detracts from the ability of users both to understand the transactions, other events and conditions that have occurred and to assess the entitys future cash ows.

Measuring assets net of valuation allowances-for example, obsolescence allowances on inventories and doubtful debts allowances on receivables-is not offsetting.

Gains and losses arising from a group of similar transactions are reported on a net basis, for example, foreign exchange gains and losses or gains and losses arising on nancial instru-ments held for trading. Such gains and losses are, however, reported separately if they are material.

4.7 Comparative information

Except when a Standard or an Interpretation permits or requires otherwise, comparative in-formation is disclosed in respect of the previous period for all amounts reported in the nancial statements.

Comparative information is included for narrative and descriptive information when it is relevant to an understanding of the current periods nancial statements.

When the presentation or classication of items in the nancial statements is amended, compara-tive amounts is reclassied unless the reclassi-cation is impracticable.

When comparative amounts are reclassied, the group discloses:- the nature of the reclassication;- the amount of each item or class of items that

is reclassied; and- the reason for the reclassication.

4,PT@KHS@SHUDBG@Q@BSDQHRSHBRNEEHM@MBH@KRS@SDLDMSR

Qualitative characteristics are the attributes that make the information provided in nancial statements useful to users.

The four principal qualitative characteristics are understandability, relevance, reliability and comparability.

5.1 Understandability

An essential quality of the information provided in nancial statements is that it is readily unders-tandable by users. For this purpose, users are assumed to have a reasonable knowledge of business and economic activities and accounting and a willingness to study the information with reasonable diligence. However, information about complex matters that should be included in the nancial state-ments because of its relevance to the economic decision-making needs of users is not excluded merely on the grounds that it may be too dif-cult for certain users to understand.

5.2 Relevance

To be useful, information must be relevant to the decision-making needs of users. Information has the quality of relevance when it inuences the economic decisions of users by helping them evaluate past , present or future events or conrming, or correcting, their past evaluations.

The relevance of information is affected by its nature and materiality.

In some cases, the nature of information alone is sufcient to determine its relevance. For example, the reporting of a new segment may affect the assessment of the risks and op-portunities facing the entity irrespective of the materiality of the results achieved by the new segment in the reporting period.

In other cases, both the nature and materiality are important , for example, the amounts of inventories held in each of the main categories that are appropriate to the business.

Information is material if its omission or missta-tement could inuence the economic decisions of users taken on the basis of the nancial statements.Materiality depends on the size of the item or error judged in the particular circumstances of its omission or misstatement .

Thus, materiality provides a threshold or cut-off point rather than being a primary qualitative characteristic which information must have if it is to be useful.

5.3 Reliability

To be useful, information must also be reliable. Information has the quality of reliability when it is free from material error and bias and can be depended upon by users to represent faithfully that which it either purports to represent or could reasonably be expected to represent .

3.1 Substance over form

If information is to represent faithfully the transactions and other events that it purports to represent , it is necessary that they are accoun-ted for and presented in accordance with their substance and economic reality and not merely their legal form.

The substance of transactions or other events is not always consistent with that which is appa-rent from their legal or contrived form.

For example, an entity may dispose of an asset to another party in such a way that the documentation purports to pass legal ownership to that party; nevertheless, agreements may exist that ensure that the entity continues to enjoy the future economic benets embodied in the asset . In such circumstances, the reporting of a sale would not represent faithfully the transaction entered into (if indeed there was a transaction).

5.3.2 Neutrality

To be reliable, the information contained in nancial statements must be neutral, that is, free from bias. Financial statements are not neutral if, by the selection or presentation of information, they inuence the making of a decision or judgement in order to achieve a predetermined result or outcome.

5.3.3 Prudence

The accountants, the controllers and all the pre-parers of nancial statements do, however, have to contend with the uncertainties that inevitably surround many events and circumstances, such as the collectability of doubtful receivables, the probable useful life of plant and equipment and the number of warranty claims that may occur.

Such uncertainties are recognised by the dis-closure of their nature and extent and by the exercise of prudence in the preparation of the nancial statements.

Prudence is the inclusion of a degree of caution in the exercise of the judgements needed in making the estimates required under conditions of uncertainty, such that assets or income are not overstated and liabilities or expenses are not understated.

However, the exercise of prudence does not allow, for example, the creation of hidden reserves or excessive provisions, the deliberate understatement of assets or income, or the de-liberate overstatement of liabilities or expenses, because the nancial statements would not be neutral and, therefore, not have the quality of reliability.

5.3.4 Completeness

To be reliable, the information in nancial state-ments must be complete within the bounds of materiality and cost . An omission can cause information to be false or misleading and thus unreliable and decient in terms of its relevance.

5.4 Comparability

Users must be able to compare the nancial statements of ArcelorMittal group through time in order to identif y trends in its nancial position and performance. Users must also be able to compare the nancial statements of diffe-rent entities in order to evaluate their relative nancial position, performance and changes in nancial position.

Hence, the measurement and display of the nancial effect of like transactions and other events is carried out in a consistent way throu-ghout all the entities of ArcelorMittal group and over time for the group.

An important implication of the qualitative characteristic of comparability is that users be informed of the accounting policies employed in the preparation of the nancial statements, any changes in those policies and the effects of such changes.

Users need to be able to identif y differences between the accounting policies for like transac-tions and other events used by the same entity from period to period and by different entities. Compliance with International Accounting Stan-dards, including the disclosure of the accounting policies used by the group, helps to achieve comparability.

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In the Manual of Accounting Policies (MAP), including all the following procedures, the accounting policies regarding the main items from the statement of nancial position and the statement of operations are described.

All the references for each theme regarding the IFRS standards are mentioned.

Other important documents as the chart of ac-counts, the BPM 2 appendices, the Global Cost Benchmarking (GCB), the CAPEX procedure, have to comply with this manual of accounting policies.

A maximum of concrete examples have been inserted in order to better explain the content of each theme.

All the CEO and CFO of each unit acknowledge their responsibility for the fair presentation of their respective package in BPM2 through a quarterly representation letter.

If you are facing any accounting issue not developed in this Manual of Accounting policies, please contact the IFRS compliance team from the Group Accounting, Consolidation and Repor-ting Department .

The structure of the MAP is divided in 4 parts:

- the Accounting Manual with the procedures regarding the statement of nancial position and the statement of operations

- the original pronouncements under IFRS- the training material - Q&A through an accounting helpdesk.

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0000 Framework IAS 10100 BPM

0300Treatment of Changes, Esti-mates and Errors in accounting policies

IAS 8

0600 Interim nancial reporting IAS 34/IFRIC 10

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All the procedures are presented within 6 chapters: introduction, assets, liabilities, statement of operations, off balance sheet or specic accounting issues.

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1100 Intangible assets IAS 36/38, SIC 32, IFRIC 10/12

1150 Property, Plant and Equipment IAS 2/16/ 36/40/41, IFRIC 1/4/6/10/18

1160 Service Concession Arrangements IFRIC 12

1200 Leases IAS 17 / IFRIC 4

1250 Asset Retirement Obligation(ARO) IAS 16 / IFRIC 1

1300 Government grant IAS 20

1450Investments accounted for usingequity method and otherinvestments

IAS 28/31/39

1600 Financial assets IAS 19/32/ 39, IFRIC 12/19

1650 Non current assets held for saleand discontinued operations IFRS 5/ IFRIC 17

2.2 Current assets


1700 Inventories IAS 2/11/161750 Stock margin IAS 2


2000 Shareholders equity IFRIC 112200 Share-based payments IFRS 22300 Non-controlling interests IAS 27


2400 Long term debt IAS 23/ 17/32/39IFRIC 4

2500 Pensions and other post-employment benets IAS 19/37 IFRIC 14

2600 Provisions for liabilities andcharges IAS 37

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2700 Trade and other payables IAS 32/39


4100 Off balance sheetcommitments IAS 16/17/37/38

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3000 Revenue IAS 183200 Cost of sales IAS 1

3400 Selling General & Administrative(SG&A ) IAS 1

3500 Staff costs IAS 193600 Impairment (being reviewed) IFRS 33700 Net nancial costs IAS 19/20/ 21/32/393900 Income taxes IAS 12

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4200 Segment reporting IFRS 84250 Earnings per share IAS 33

4300 Business combination (under review) IFRS 3

4450 Cash ow statement IAS 7

4500 Effects of changes in foreignexchange rates IAS 21/29

4600 Hedge accounting (under review)

IAS 32/39IFRIC 9IFRS 7

4610 Embedded derivatives in purchasing contracts IAS 39 / IFRIC 9

4650 True sales of recevables(TSR) IAS 39

4700 Environmental provisions IAS 374800 Related Party Disclosures IAS 244850 Emission rights (under review) Not covered by IASB

4900 Events after the reportingperiod IAS 10

MAP Pocket Guide Page 8

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@qbdknqLhsskGroup Accounting, Consolidation & Reporting dept.All rights reserved

Manual of AccountingPolicies (MAP)

This procedure is strictly condential and is for internal use of ArcelorMittal. Only ArcelorMittalstaff may have access to this procedure. No copy of it can be given to somebody outside ArcelorMittal without the written aproval of the designed responsible person. The divulgationof this technical note without the appropriate will be considered as an improper conduct .

BPM (Business Performance Management) and ArcelorMittal reporting

N 0100

March2010

March 2010

Manual of AccountingPolicies (MAP)2010

2010 am manual of accounting policies (map)_recovered

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