Maxcom Telecommunications (MXMTY) 20-F/A 2008 FY Annual report (foreign) (amended)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F/A

(Amendment No. 1)

(Mark One)

o REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

o SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2008
Commission file number: 001-33750

Maxcom Telecomunicaciones, S.A.B. de C.V.

(Exact name of Registrant as specified in its charter)

Maxcom Telecommunications, Inc.
(Translation of Registrant’s name into English)

United Mexican States
(Jurisdiction of incorporation or organization)

C. Guillermo González Camarena No. 2000
Col. Centro de Ciudad Santa Fe
México, D.F., 01210
(Address of principal executive offices)

Juan Carlos Sotomayor
Director of Investor Relations
Tel. + (52) 55 4770-1170
Fax. + (52) 55 5147-3820
juan.sotomayor@maxcom.com
Maxcom Telecomunicaciones, S.A.B. de C.V.

C. Guillermo González Camarena No. 2000
Col. Centro de Ciudad Santa Fe
México, D.F., 01210
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

American Depositary Shares (“ADSs”), each representing seven (7) Ordinary Participation
Certificates (Certificados de Participación Ordinarios) (“CPOs”), each CPO representing
three (3) Series A Common Stock, without par value, registered with the New York Stock Exchange Euronext

Securities registered or to be registered pursuant to Section 12(g) of the Act:
None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:
11% Senior Notes due 2014, not registered on an exchange
(Title of Class)

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: 789,818,829 shares of Series A common stock

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.Yeso Noþ

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Yeso Noþ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yesþ Noo

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files)Yeso Noo

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

o Large accelerated filer o Accelerated filer þ Non-accelerated filer

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

o U.S. GAAPo International Financial Reporting Standards as issued by the International Accounting Standards Boardþ Other

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow:

Item 17o Item 18þ

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yeso Noþ

EXPLANATORY NOTE

This Amendment No. 1 on Form 20-F/A (this “Amendment”) amends our Annual Report on Form 20-F for the fiscal year ended December 31, 2008, originally filed with the Securities and Exchange Commission (the “SEC”) on June 30, 2009 (the “Original Filing”). We are filing this Amendment to include the accountants’ reports and attestation report on internal control over financial reporting required by Items 17 and 18 of Form 20-F that were inadvertently omitted from the Original Filing. In addition, as required by Rule 12b-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), new certifications by our principal executive officer and principal financial officer are filed as exhibits to this Amendment No. 1 on Form 20-F/A under Item 19 of Part III hereof.

For purposes of this Amendment No. 1 on Form 20-F/A, and in accordance with Rule 12b-15 under the Exchange Act, Items 17, 18 and 19 of our Original Filing have been amended and restated in their entirety. Except as described above, no other changes have been made to the Original Filing. The Original Filing continues to speak as of the date of the Original Filing, and we have not updated the disclosures contained therein to reflect any events which occurred at a date subsequent to the filing of the Original Filing.

TABLE OF CONTENTS

 Exhibit 12.1

 Exhibit 12.2

 Exhibit 13.1

 Exhibit 13.2

PART III

ITEM 17. FINANCIAL STATEMENTS

We have responded to Item 18 in lieu of responding to this Item.

ITEM 18. FINANCIAL STATEMENTS

Consolidated Financial Statements of Maxcom Telecomunicaciones, S.A.B. de C.V. and Subsidiaries

	Page
Reports of Independent Registered Public Accounting Firms		F-1
Consolidated Balance Sheets as of December 31, 2008 and 2007		F-4
Consolidated Statements of Operations for the years ended December 31, 2008, 2007 and 2006		F-5
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2008, 2007 and 2006		F-6
Consolidated Statement of Cash Flows for the year ended December 31, 2008		F-7
Consolidated Statement of Changes in Financial Position for the years ended December 31, 2007 and 2006		F-8
Notes to the Consolidated Financial Statements for the years ended December 31, 2008, 2007 and 2006		F-9

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders
Maxcom Telecomunicaciones, S. A. B. de C. V.:

We have audited the accompanying consolidated balance sheet of Maxcom Telecomunicaciones, S. A. B. de C. V. and subsidiaries (the Company) as of December 31, 2008, and the related consolidated statements of operations, stockholders’ equity and cash flows for the year ended December 31, 2008. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States) and with auditing standards generally accepted in Mexico. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Maxcom Telecomunicaciones, S. A. B. de C. V. and subsidiaries as of December 31, 2008, and the results of their operations and their cash flows for the year ended December 31, 2008, in conformity with Mexican Financial Reporting Standards.

As disclosed in note 6 to the consolidated financial statements, several new Mexican Financial Reporting Standards were adopted on January 1, 2008.

As mentioned in note 5q to the consolidated financial statements, the Company carried out significant transactions with certain suppliers.

Mexican Financial Reporting Standards vary in certain significant respects from accounting principles generally accepted in the United States of America. Information relating to the nature and effect of such differences is presented in note 21 to the consolidated financial statements.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Maxcom Telecomunicaciones, S. A. B. de C. V.’s internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated June 25, 2009 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

KPMG Cárdenas Dosal, S. C.

/s/Manuel Jimenez Lara

Manuel Jimenez Lara

Mexico City, Mexico

June 25, 2009

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders
Maxcom Telecomunicaciones, S. A. B. de C. V.:

We have audited Maxcom Telecomunicaciones, S. A. B. de C. V.’s internal control over financial reporting as of December 31, 2008, based on criteria established inInternal Control — Integrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Maxcom Telecomunicaciones, S. A. B. de C. V.’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Maxcom Telecomunicaciones, S. A. B. de C. V. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on criteria established inInternal Control — Integrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) and with auditing standards generally accepted in Mexico, the consolidated balance sheet of Maxcom Telecomunicaciones, S. A. B. de C. V. and subsidiaries as of December 31, 2008, and the related consolidated statements of operations, stockholders’ equity, and cash flows for the year ended December 31, 2008, and our report dated June 25, 2009, expressed an unqualified opinion on those consolidated financial statements.

KPMG Cárdenas Dosal, S. C.

/s/Manuel Jimenez Lara

Manuel Jiménez Lara

Mexico City, Mexico

June 25, 2009

F-2

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of
Maxcom Telecomunicaciones, S. A. B. de C. V. and subsidiaries
(formerly Maxcom Telecomunicaciones, S. A. de C. V. and subsidiaries)

We have audited the consolidated balance sheet of Maxcom Telecomunicaciones, S. A. B. de C. V. and subsidiaries as of December 31, 2007, and the related consolidated income statements, the statements of changes in shareholders’ equity and the statements of changes in financial position for the two years ended December 31, 2007. These consolidated financial statements are the responsibility of the company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in Mexico and with the Standards of the Public Company Accounting oversight Board (United States of America). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the Mexican Financial Reporting Standards used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Maxcom Telecomunicaciones, S. A. B. de C. V. and subsidiaries as of December 31, 2007, and the consolidated results of their operations, changes in equity and changes in financial position for each of the two years in the period ended December 31, 2007, in conformity with Mexican Financial Reporting Standards.

Mexican Financial Reporting Standards vary in certain significant respects from the accounting principles generally accepted in the United States of America. Information relating to the nature and effect of such differences is presented in Note 21 to the consolidated financial statements.

PricewaterhouseCoopers, S. C.

/s/ Humberto Pacheco Soria

Humberto Pacheco Soria

Audit Partner

Mexico City, March 4, 2008, except for Note 21 which the date is May 30, 2008.

F-3

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2008 and 2007

(Thousands of Mexican Pesos — Note 5)

	2008			2007
Assets
Current assets:
Cash and cash equivalents	$	1,591,405			2,539,535
Accounts receivable:
Customers, net of allowance for doubtful accounts of $161,936 and $107,652 for 2008 and 2007, respectively		716,203			517,254
Value added tax recoverable		164,448			198,583
Other accounts receivable		77,650			54,676
		958,301			770,513
Inventory — Net		40,876			33,249
Prepaid expenses — Net		30,778			40,341
Total current assets		2,621,360			3,383,638
Long lived assets:
Telephone network systems and equipment — Net (Note 7)		4,684,413			4,188,946
Intangible assets — Net (Note 8)		209,683			208,802
Preoperating expenses — Net		50,863			77,902
Frequency rights — Net (Note 9)		66,716			80,930
Other assets:
Intangible asset derived from employee benefits (Notes 6b. and 14)		—			17,650
Deferred income taxes — Net (Note 19)		148,114			—
Prepaid expenses — Net		15,381			21,289
Guaranty deposits		8,315			6,943
Derivative financial instruments (Notes 5o. and 13)		105,270			13,475
Other assets		6,357			14,525
Total assets	$	7,916,472			8,014,100
Liabilities and Shareholders’ Equity
Current liabilities:
Trade accounts payable	$	469,328			489,486
Accruals		45,505			24,109
Current installments of obligations under capital leases		4,354			8,087
Customer deposits		2,518			2,801
Other taxes payable		61,048			67,182
Accrued interests (Note 11)		13,920			11,172
Total current liabilities		596,673			602,837
Long-term liabilities :
Senior notes (Note 11)		2,707,660			2,173,240
Obligation under capital leases, excluding current installments		—			4,686
Other accounts payable		80,872			78,174
Derivative financial instruments (Notes 5o. and 13)		8,472			—
Deferred income taxes — Net (Note 19)		—			97,742
Labor obligations upon retirement (Note 14)		21,626			26,582
Total long-term liabilities		2,818,630			2,380,424
Total liabilities		3,415,303			2,983,261
Shareholders’ equity (Notes 15 and 16)
Capital stock		5,410,244			5,410,251
Additional paid-in capital		816,443			888,056
Deficit		(1,705,231	)		(1,267,468	)
Repurchase of shares		(20,287	)		—
Total shareholders’ equity		4,501,169			5,030,839
Commitments and contingencies (Note 20)
Total liabilities and shareholders’ equity	$	7,916,472			8,014,100

The accompanying 21 notes are an integral part of these consolidated financial statements, which were authorized to be issued by the Company’s Board of Directors on June 25, 2009.

F-4

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Consolidated Statements of Operations

Years Ended December 31, 2008, 2007 and 2006

(Thousands of Mexican Pesos, except share data — Note 5)

	2008			2007			2006
Net revenues (Note 17)	$	2,683,229			2,345,719			1,741,692
Operating costs and expenses:
Network operating costs		(1,120,167	)		(976,979	)		(676,977	)
Selling, general and administrative expenses (Note 6)		(819,642	)		(722,618	)		(607,505	)
Depreciation and amortization		(551,889	)		(370,227	)		(300,468	)
Total operating costs and expenses		(2,491,698	)		(2,069,824	)		(1,584,950	)
Operating income		191,531			275,895			156,742
Other expenses:
Other expenses		(12,616	)		(12,819	)		(18,777	)
Restructuring charges (Notes 5n and 14)		(49,491	)		—			—
Impairment of long-lived assets (Notes 5(h), 5(i), 7, 8 and 9)		(532,315	)		—			—
Employees’ statutory profit sharing (Notes 6 and 19)		(1,173	)		(3,257	)		—
Other expenses, net		(595,595	)		(16,076	)		(18,777	)
Comprehensive financing cost — Net (Note 18)		(267,393	)		(126,641	)		(107,182	)
(Loss) income before income taxes		(671,457	)		133,178			30,783
Income taxes (Note 19):
Current tax expense		(12,162	)		(50,700	)		—
Deferred tax benefit (expense)		245,856			(46,282	)		(60,050	)
Total income tax benefit (expense)		233,694			(96,982	)		(60,050	)
Net (loss) income for the year	$	(437,763	)		36,196			(29,267	)
(Loss) earnings per share (Note 5t):
Basic (loss) earnings per common share (pesos)	$	(0.55	)		0.06			(0.07	)
Diluted (loss) earnings per common share (pesos)	$	(0.53	)		0.06			(0.06	)
Weighted average basic shares (thousands)		789,819			560,176			442,928
Weighted average diluted shares (thousands)		829,337			606,144			467,628

The accompanying 21 notes are an integral part of these consolidated financial statements, which were authorized to be issued by the Company’s Board of Directors on June 25, 2009.

F-5

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Consolidated Statements of Stockholders’ Equity

Years ended December 31, 2008, 2007 and 2006

(Thousands of Mexican Pesos — Note 5)

				Additional			Retained						Total
	Capital			paid-in			earnings			Repurchase			stockholders’
	stock			capital			(deficit)			of shares			equity
Balances as of December 31, 2005	$	2,963,206			237,114			(1,274,397	)		—			1,925,923
Increase in capital stock (Note 15)		364,276			—			—			—			364,276
Stock options plans (Note 16)		—			15,982			—			—			15,982
Comprehensive net loss		—			—			(29,267	)		—			(29,267	)
Balances as of December 31, 2006		3,327,482			253,096			(1,303,664	)		—			2,276,914
Increase in capital stock (Note 15)		2,082,769			597,836			—			—			2,680,605
Stock options plans (Note 16)		—			37,124			—			—			37,124
Comprehensive net income		—			—			36,196			—			36,196
Balances as of December 31, 2007		5,410,251			888,056			(1,267,468	)		—			5,030,839
Decrease in capital stock (Note 15)		(7	)		—			—			—			(7	)
Stock options plans (Notes 15 and 16)		—			(71,613	)		—			—			(71,613	)
Repurchase of shares (Note 15)		—			—			—			(20,287	)		(20,287	)
Comprehensive net loss		—			—			(437,763	)		—			(437,763	)
Balances as of December 31, 2008	$	5,410,244			816,443			(1,705,231	)		(20,287	)		4,501,169

The accompanying 21 notes are an integral part of these consolidated financial statements, which were authorized to be issued by the Company’s Board of Directors on June 25, 2009.

F-6

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Consolidated Statement of Cash Flows

Year ended December 31, 2008

(Thousands of Mexican Pesos — Note 5)

	2008
Cash flows from operating activities:
Loss before taxes	$	(671,457	)
Items related to investing activities:
Depreciation and amortization		551,889
Impairment of long lived assets		532,315
Loss on sale of telephone network systems and equipment		82,496
Items related to financing activities:
Financial instruments		(83,323	)
Interest expense		217,210
Subtotal		629,130
Customer accounts receivable		(198,949	)
Recoverable value added tax		34,135
Other accounts receivable		(22,974	)
Inventory		(7,627	)
Prepaid expenses		9,563
Trade accounts payable, provisions and other acumulated liabilities		1,238
Income taxes paid		(7,320	)
Customer deposits		(283	)
Other liabilities and taxes payable		(3,436	)
Changes in employees benfits and provisions		12,694
Net cash provided by operating activities		446,171
Cash flows from investing activities:
Capital expenditures (including interest capitalized in the amount of $62,029 in 2008)		(1,631,001	)
Proceeds from sale of telephone network systems and equipment		4,364
Increase in other non-current assets		12,704
Net cash used in investing activities		(1,613,933	)
Cash flows from financing activities:
Bonds payable		534,420
Decrease in capital stock		(7	)
Stock options plans		(71,613	)
Interest paid		(214,462	)
Capital lease, payment of credits		(8,419	)
Repurchase of shares		(20,287	)
Net cash provided by financing activities		219,632
Net decrease in cash and equivalents		(948,130	)
Cash and cash equivalents:
At beginning of year		2,539,535
At end of year	$	1,591,405

The accompanying 21 notes are an integral part of these consolidated financial statements, which were authorized to be issued by the Company’s Board of Directors on June 25, 2009.

F-7

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Consolidated Statement of Changes in Financial Position

Years Ended December 31, 2007 and 2006

(Thousands of Mexican Pesos — Note 5)

	2007			2006
Operating activities:
Net income (loss)	$	36,196			(29,267	)
Add charges (deduct credits) to operations not requiring (providing) funds:
Depreciation and amortization		370,227			300,468
Deferred income taxes		46,282			60,050
Stock options plan		37,124			15,982
Accelerated amortization of debt		—			17,671
Employee benefits		5,752			4,642
Net financing from (investing in) operating accounts:
Accounts receivable		(285,004	)		(251,021	)
Inventories		2,540			(19,160	)
Prepaid expenses		4,109			18,414
Restricted cash and other current assets and liabilities		85,932			(29,881	)
Resources provided by operating activities		303,158			87,898
Financing activities:
Capital stock increases		2,643,369			364,276
Proceeds from loans and bonds payable, net of payments and capitalizations		126,160			1,092,993
Derivative financial instruments		(24,036	)		(5,217	)
Resources provided by financing activities		2,745,493			1,452,052
Investing activities:
Telephone network systems and equipment, net of dispositions		(1,160,359	)		(1,130,118	)
Acquisition of subsidiaries		(33,576	)		(101,173	)
Intangible assets		(54,472	)		190,425
Other assets		—			(1,011	)
Resources used in investing activities		(1,248,407	)		(1,041,877	)
Increase of cash and cash equivalents		1,800,244			498,073
Cash and cash equivalents:
At beginning of year		739,291			241,218
At end of year	$	2,539,535			739,291

The accompanying 21 notes are an integral part of these consolidated financial statements, which were authorized to be issued by the Company’s Board of Directors on June 25, 2009.

F-8

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

NOTE 1 — ENTITY, INCORPORATION AND CHANGE OF INCORPORATION STRUCTURE:

Maxcom Telecomunicaciones, S. A.B. de C. V. (“Maxcom” or the “Company”), is a Mexican company incorporated on February 28, 1996. Its main corporate purpose is the construction and operation of a telephone network, voice over IP, local, national and international long-distance telephony services, public telephony, data transfer services, internet, pay TV, virtual private network services and other value-added services, within Mexico. The Company also provides mobile telephony services as a virtual mobile network operator. The Company began its commercial operations in May 1999.

Pursuant to the resolutions adopted by the shareholders at the General Extraordinary and Ordinary Shareholders Meetings held on September 13, 2007, and by virtue of the public offering of shares carried out by the Company in Mexico and abroad, Maxcom was denominated as a publicly listed stock company with variable capital (“sociedad anónima bursátil de capital variable” or “S.A.B. de C. V.”). Now, the Company is subject not only to the applicable provisions of the Business Corporations Law but to the stock exchange regulations under the Stock Exchange Laws in Mexico and the United States of America, as well as the supervision of the National Banking and Securities Commission (“NBSC”, “Comisión Nacional Bancaria y de Valores” or “CNBV”) and the Securities Exchange Commission (“SEC”). Upon the terms of such resolutions, the by-laws of the Company were amended in their entirety to conform them to the Stock Exchange Act and ancillary regulations.

NOTE 2 — CONCESSIONS, FREQUENCY RIGHTS AND INTERCONNECTION AGREEMENTS:

Concessions:

On February 3, 1997, the Mexican Ministry of Communications and Transportation (“Secretaría de Comunicaciones y Transportes” or “SCT”) awarded the Company a concession to install and operate a public telecommunications network in Mexico (the “concession”). This concession is not exclusive. The initial term of the concession is 30 years and includes certain renewal rights. Subsequently, on December 7, 1999, September 27, 2001 and December 2, 2004, the Company received amendments to the initial terms and conditions of the concession.

F-9

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

The concession grants the Company the right to provide local, national and international long-distance telephony services, data transfer services and other value-added services in any part of the Republic of Mexico and, under the last amendment dated December 2, 2004, certain obligations were set forth for the Company, as described in note 20d.

On August 4, 2006, the SCT granted Maxcom a concession to provide cable television services (traditional) and audio in the city of Puebla. Shortly thereafter, the SCT issued the Convergence Regulations, under which different types of telecommunications service providers are authorized to provide certain services in addition to those included under the original concessions.

On January 17, 2007, the Mexican Federal Telecommunications Commission (“Comisión Federal de Telecomunicaciones” or “COFETEL”) authorized Maxcom to provide mobile virtual network operator (MVNO) services, based on its 1996 concession. This authorization allows Maxcom to provide mobile telephone services throughout Mexico using its own brand, acquiring capacity from other concessionaires of this service in Mexico. As a result of this authorization, Maxcom is the first, and thus far, the only telecommunications concessionaire to offer quadruple-play services (voice, video, data and cellular) on an extensive basis under its own brand name. The terms of the cable television and restricted radio concession and the MVNO authorization match the thirty-year term (expiring in 2026) of the concession granted in 1996 and impose no further obligations, including minimum coverage or investment commitments.

Frequency rights:

On October 3, 1997, the Mexican Federal Government through the SCT granted the Company ten concession rights (the “frequency rights”) to use and exploit different bands of the radio-electric spectrum and to establish point-to-point and point-to-multi-point microwave links; seven are nationwide point-to-point and three are regional point-to multipoint microwave concessions. The frequency rights became effective on February 28, 1998, and shall remain in effect until 2018, see note 9.

In accordance with the terms of these frequency rights concessions, the Company must provide to the SCT a guarantee on its operations in the form of a surety bond and renew it every year, see note 20e.

F-10

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Convergence agreement:

On October 2, 2006, the Mexican Federal Government, through the SCT, issued a non-binding agreement for the rendering of services in convergence, which is known as “Agreement of Convergence of Fixed Services of Local Telephony and Restricted Audio and/or Television that are provided through Wired and Wireless Public Networks” (“Convergence Agreement”).

The convergence agreement allows certain concessionaires of services of telecommunications to provide other services not included in the original concessions that were granted to them. The suppliers of cable television will now be able to provide the service of internet and telephony. Also the telephony operators, like Maxcom, will now be able to provide restricted services of audio and/or video. On October 13, 2006, Maxcom notified the SCT its compliance and voluntary adhesion to the Convergence Agreement and, therefore, the SCT authorized to provide the restricted services of audio and video besides to the previously authorized as a part of the original concessions of the public telecommunications network.

Interconnection agreements:

On January 22, 1999, the Company entered into a contract to provide local interconnection services (the “agreement”) with Teléfonos de México, S. A. B. de C. V. (“Telmex”), whereby Maxcom agrees to render Telmex interconnection services to finish Telmex’s long-distance traffic in Maxcom’s local network.

Likewise, the Company subscribed an interconnection agreement to handle Maxcom’s long distance traffic towards Telmex’s local network.

The Company has negotiated the signing of various amending agreements to the contract with Telmex, to extend the original term of that contract, irrespective of the fact that the contract provides that the interconnection between the two companies is carried out based on the clause of “continuous application”. This clause sets forth that upon termination of the first period, the original terms and conditions of the contract will continue in full force and effect until the parties sign a new contract to continue interconnecting their networks. This contract has had yearly updates up until now.

During 2003 and 2002, the Company entered into various interconnection and reselling agreements with other local and long distance carriers and mobile phone companies, as well as agreements which allow the Company to render public telephony services through the capacity acquired from mobile networks.

F-11

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

The rights and obligations under certain interconnection contracts of Telereunion were transferred to Maxcom at the end 2006 and beginning of 2007. See note 3b.

NOTE 3 — RELEVANT CORPORATE EVENTS:

a. Acquisition of Sierra Comunicaciones Globales:

On November 15, 2007, the Company acquired all the shares representing the capital stock of Sierra Comunicaciones Globales, S. A. de C. V. (Sierra). The purchase price for the shares was 3.0 million dollars, which were paid in two installments 1.75 million dollars on November 15, 2007, and the remaining 1.25 million dollars were paid on November 10, 2008.

Sierra owns two strands of fiber optic physically located within Maxcom’s network. At the time of the acquisition, Sierra had no operations.

As of the acquisition date of Sierra, the assets and liabilities at their fair value are described below, including the allocation of the goodwill:

						Net assets
	Book Value					recognized at
	of net assets as					fair value as of
	of November 15,			Goodwill		November 15,
	2007			allocation		2007
Assets:
Current assets	$	45			—		45
Fixed assets		10,935			21,814		32,749
		10,980			21,814		32,794
Liabilities:
Current liabilities		(112	)		—		(112	)
Net acquired assets		10,868			21,814		32,682
Net assets fair value		(32,682	)		—		(32,682	)
Cost in excess of book value of subsidiaries	$	(21,814	)		21,814		—

F-12

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

During the year ended December 31, 2007, Sierra had no operations; therefore pro forma results as if the acquisition had taken place on January 1, 2007 have not been presented as shown in the previous chart. Also, due to what is previously described there is no effect from Sierra in Maxcom’s consolidated statement of operations as of December 31, 2007.

On October 2008 Sierra began operations through the leasing of its optical fiber to the Company.

b. Acquisition of Grupo Telereunion:

On March 13, 2006, Maxcom announced that an agreement had been reached to acquire three companies of Grupo Telereunion, a long distance operator with the concession to also provide other value-added services. This acquisition was completed on July 21, 2006.

The acquisition provided Maxcom with approximately 480 kilometers of urban and suburban fiber optic rings, with local interconnection in 59 cities and doubled our switching capabilities. The acquisition also provided over approximately 4,300 additional kilometers of backbone, including a border crossing into the United States of America Grupo Telereunion obtained its concession in 1998 and began operating in 2000.

As of the acquisition date of the companies from Grupo Telereunion by Maxcom, the assets and liabilities at their fair value are described below, including the preliminary allocation of the purchase price:

							Net assets
	Book value of			Negative			recognized at
	net assets as of			goodwill			fair value as of
	June 30, 2006			allocation			June 30,2006
Assets:
Current assets	$	56,530			—			56,530
Fixed assets		421,572			(166,944	)		254,628
Intangible assets		224,844			(224,844	)		—
Deferred taxes		37,467			(37,467	)		—
		740,413			(429,255	)		311,158
Liabilities:
Current liabilities		(211,278	)		—			(211,278	)
Net acquired assets		529,135			(429,255	)		99,880
“Net assets fair value”		(99,880	)		—			(99,880	)
Book value in excess of cost of subsidiaries (negative goodwill)	$	429,255			(429,255	)		—

F-13

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

On September 7, 2006 a trust agreement was signed between the former owners of the Grupo Telereunion companies and Maxcom. The purpose of this trust agreement is to provide a mechanism to ensure the performance of certain obligations of the former owners of the Grupo Telereunion companies, as seller of the shares, by allowing to making certain price adjustments to the 8.54 million dollars acquisition cost of the shares, if necessary. The 7,487,283 Series N Maxcom’s shares pertaining to the new shareholder were deposited in the trust. See note 15.

Because the expiration date for the trust was reached, and the conditions were met on November 12, 2007, an agreement was signed extinguishing the trust described in the preceding paragraph. The responsibility to compensate Maxcom for any loss or liabilities that might arise due to any event preceding the acquisition remains with the former owners of Grupo Telereunion.

The unaudited condensed combined statement of operations for Telereunion, S.A. de C.V., Telscape de México, S.A. de C.V. and Sierra USA Communications, Inc for the period of July 1, 2006 to December 31, 2006 is the following:

Net revenues	$	88,414
Cost		(61,223	)
Expenses		(1,259	)
Depreciation		(10,418	)
Operating income	$	15,514
Net income	$	26,755

F-14

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

NOTE 4 — CONSOLIDATION BASIS:

The consolidated financial statements include the accounts of Maxcom and its subsidiaries of which it controls and has 99.9% or more of the voting shares:

Subsidiary company	%		Line of business
Corporativo en Telecomunicaciones, S. A. de C. V.		99.9	Technical personnel services
Maxcom Servicios Administrativos, S. A. de C. V.		99.9	Administrative personnel services
Maxcom SF, S. A. de C. V.		99.9	Financial services
Outsourcing Operadora de Personal, S. A. de C. V.		99.9	Technical personnel services
TECBTC Estrategias de Promoción, S. A. de C. V.		99.9	Technical personnel services
Maxcom TV, S. A. de C. V. *		99.9	Cable television services

Subsidiary company	%		Line of business
Maxcom USA, Inc. *		100.0	International telecommunications services
Telereunion, S. A. de C. V.		99.9	Long distance and infrastructure leasing
Telscape de México, S. A. de C. V.		99.9	Real estate services
Sierra USA Communications, Inc.		100.0	International telecommunication services
Sierra Comunicaciones Globales, S. A. de C. V.		99.9	Infrastructure leasing

* Dormant companies.

The financial statements of Sierra Comunicaciones Globales, S. A. de C. V., were incorporated to the consolidated financial statements of Maxcom as from November 15, 2007.

The financial statements of Telereunion, S. A. de C. V. (Telereunion), Telscape de México, S. A. de C. V. (Telscape) and Sierra USA Communications, Inc., (Sierra USA), as a whole “Grupo Telereunion”, were incorporated to the consolidated financial statements of Maxcom as of July 2006.

F-15

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

All the significant balances and transactions between Maxcom and its subsidiaries are eliminated in the consolidated financial statements.

NOTE 5 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

The accompanying consolidated financial statements are expressed in thousands of Mexican pesos, and have been prepared in accordance with the Mexican Financial Reporting Standards (“MFRS”, “Mexican GAAP”, or “NIF”, for its initials in Spanish as described below) applicable at the balance sheet date.

Financial statements for 2007 and prior years are expressed in constant pesos as of December 31, 2007 the last date when the restatement was made according to the previous Statement B-10 “Recognition of the Effect of Inflation in Financial Information” which was replaced by NIF B-10, Effects of Inflation.

On June 25, 2009, the Board of Directors authorized the issuance of these consolidated financial statements which are subject to approval by the General Shareholders’ Meeting that could decide their modification in accordance to the Mexican Corporate Law (“Ley General de Sociedades Mercantiles”).

For disclosure purposes in the notes to the consolidated financial statements when referring to pesos or “$” it should be understood as thousands of Mexican Pesos, and when to referring to dollars or USD it should be understood as thousands of United States dollars, the legal currency in the United States of America.

The preparation of financial statements requires management to make a number of estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include, but are no limited to, the carrying amount of telephone network systems and equipment, intangible assets, preoperating expenses and frequency rights, including depreciation and amortization rates, assumptions made for the calculation of the impairment test to long lived assets; valuation allowances for receivables, inventories, construction in progress of telephone network systems and equipment and deferred income tax assets; valuation of financial instruments; and obligations related to employee benefits. Actual results could differ from those estimates and assumptions.

The significant accounting policies used by the Company in the preparation of its consolidated financial statements, including the items, methods and criteria related to the recognition of the effects of inflation on the financial information, are summarized below:

F-16

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

a. Recognition of the effects of the inflation

The consolidated financial statements of the Company have been prepared in accordance with Mexican Financial Reporting Standards (“MFRS”) in effect as of the balance sheet date and include the recognition of the effects of inflation on the financial information through December 31, 2007, based on the Mexican National Consumer Price Index (“NCPI”) published by Banco de México (central bank of México).

The accumulated percentage of inflation for the previous three year periods and the indexes used to recognize the effects of inflation for the year, are the following:

			Inflation
December 31,	NCPI		Year			Accumulated
2008		133.761		6.53	%		18.85	%
2007		125.564		3.76	%		11.56	%
2006		121.015		4.05	%		7.52	%
2005		116.301		3.33	%		3.33	%

b. Cash and cash equivalents

The temporary investments include investments denominated in local currency and dollars. Investments in national currency usually provide daily liquidity and are made in repurchase agreements. The dollar investments are made with highly reputable financial institutions in the United States of America through low risk money market funds. These funds provide daily liquidity and give the highest financial return while preserving the value of the principal invested, by investing in instruments with the highest market credit rating. During 2008, the Company held most of its investments with Smith-Barney Citi Group. At any given time, temporary investments are valued at market value. During 2008, there were no impairments recorded on any of our investments.

F-17

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

c. Inventories

Inventory consists of materials used to install telephone lines and network build-out, as well as its sale cost, are originally registered at average cost and up to December 31, 2007 were subsequently updated by the application of factors derived from the NCPI. The values thus determined do not exceed their market value. The allowance for obsolescence and slow-moving is evaluated on a six months basis and according to the results of this evaluation, products are subject to a slow-moving or obsolescence allowance.

d. Telephone network systems and equipment

Telephone network systems and equipment are recorded at acquisition cost and until December 31, 2007 were restated by applying factors derived from the NCPI.

The Company constructs certain of its own network systems and related facilities. Internal costs directly related to the construction of such facilities are capitalized. The amounts capitalized during 2008, 2007 and 2006 were $88,478, $72,052 and $ 47,753, respectively.

The Company capitalizes the comprehensive financing costs attributable to assets under construction. Capitalized comprehensive financing cost includes interest expense, gains from monetary position (until December 31, 2007), and foreign exchange losses, and are determined by reference to the Company’s average interest cost on borrowings. See note 18.

Installation costs include labor, tools and supplies. Installation costs related to commercial customers are capitalized and amortized on a straight line basis for a period of 20 years. Installation costs capitalized are expensed once the relationship with the customer is terminated.

When the Company invoices its residential customers for installation fees, any associated cost is recognized as an expense in the statement of operations.

Depreciation is calculated by the straight-line method over the restated cost, based on the estimated useful lives of the assets. Depreciation is charged to results of operations.

F-18

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

During 2007 the Company performed a technical study on the remaining useful lives of the public telephony equipment, based on the opinion of a specialist. As a result thereof, useful lives were decreased from 17 to 8 years. The Company recalculated the amount of depreciation expense related to these assets for the year 2007, which amounted to $33,231. If depreciation would have been estimated based on the previous remaining useful lives, the depreciation expense for the year 2007 would have been of $16,011.

Maintenance and minor repairment costs are charged to results as incurred; replacement and improvement costs are capitalized. The cost and related allowances of assets sold or retired are removed from the accounts, and any resulting profit or loss is reflected in the statement of results of operations.

e. Intangible assets

Intangible assets are recognized in the balance sheet as long as they are identifiable, they provide future economic benefits, and the Company has control over such benefits. Intangible assets with a definite useful life are amortized systematically based on the best estimation of its useful life, as determined in accordance with the expected future economic benefits.

Purchased software and certain activities of developing internal-use software are capitalized and amortized over their expected useful lives. Other activities, such as training, maintenance and re-engineering are recognized in the results of the period, as incurred.

Debt issuance costs are amortized on a straight-line basis over the term of the related debt. As of December 31, 2008 and 2007, capitalized expenses for the new debt issuance amount to $62,283 and $60,340, respectively. See note 8.

At the end of the year 2006, in accordance to NIF C-9 “Liabilities, Accruals, Contingent Assets and Liabilities and Commitments” , Company’s management determined that the issuance of Bonds made on December 2006, represented a new debt in accordance with the provisions specified in such NIF, thus any remaining balances for debt issued in prior years, were written off. The expenses incurred for the issuance of the new debt are being amortized in an 8 year period. The anticipated amortization of the old debt amounted to $17,671, which, in accordance with the new NIF B-3 “Income Statement” is included within the category of other expenses in the statement of operations at December 31, 2006 (in the statement of operations for that year this amount was presented as a special item).

F-19

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

f. Concessions

As previously mentioned (note 2), the SCT awarded the Company, at no cost, a concession to install and operate a public telecommunications network for a 30-year period. In accordance with Statement C-8 “Intangible Assets” of NIF, this concession has no recorded value for financial reporting purposes and it is only disclosed in a note to these consolidated financial statements.

g. Frequency rights

Frequency rights are recorded at their acquisition cost and until December 31, 2007 were restated by applying factors derived from the NCPI as from the acquisition date. Amortization is calculated by the straight-line method over 20 years, which is the term of the frequency rights. See note 9.

h. Preoperating expenses

All expenses incurred during the development stage or in specific projects in progress up to December 31, 2002 were capitalized. Those expenses are amortized by the straight-line method over a 10-year period. The amortization period begins when the corresponding project starts up operations.

For the years ended December 31, 2008, 2007 and 2006, the Company recorded amortization expense in the amounts of $22,123, $ 19,983 and $ 36,433, respectively. Also as of December 31, 2008 the Company made an adjustment based on the impairment recorded of $4,915. Accumulated amortization was $334,767 and $ 312,644 as of December the 31, 2008 and 2007, respectively.

i. Impairment of long lived assets.

The Company evaluates values of long lived assets when there are events or changes that reveal an indication of potential impairment. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net income expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated net income, an impairment charge is recognized by the amount that the carrying amount of the asset exceeds the fair value of the asset. Given the current economic situation there is a strong reliance on judgment to evaluate if the indication of potential impairment to long lived assets should give rise to an impairment valuation.

F-20

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

As of December 31, 2008, the carrying amount of long-lived assets was higher than the expected discounted income at the Company’s theoretical rate for weighted average cost of capital under current market conditions. The impairment charge (a non-cash item) calculated for 2008 amounted to $532,315. Said charge was proportionately distributed throughout the different asset classes. See notes 5(h), 7, 8, and 9.

j. Liabilities and accruals

The Company’s liabilities and accruals recognized in the balance sheet represent current obligations which will probably require disbursement of economic resources. These provisions have been recorded based on management’s best estimate to cover the current obligation; however, actual results could differ from the provisions recognized.

k. Transactions in foreign currencies

Transactions in foreign currencies are recorded at the prevailing exchange rates at the date of the transaction, with the related exchange gain or loss recorded within the statement of operations. Assets and liabilities denominated in said currencies are valued at the exchange rate in force at the close of the period, with the related exchange gain or loss recognized as part of the comprehensive financing cost.

l. Income Tax (IT), Asset Tax (AT), Flat Rate Business Tax (IETU), and Employees’ Statutory Profit Sharing (ESPS)

IT, IETU and ESPS payable for the year are determined in conformity with the tax provisions in effect.

Deferred IT, IETU and, from January 1, 2008 deferred ESPS, are accounted for under the asset and liability method. Deferred tax and ESPS assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and in the case of IT and IETU, for tax loss and credit carryforwards. Deferred tax and ESPS assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax and ESPS assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. See note 19.

F-21

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

m. Employees’ Statutory Profit Sharing (“ESPS”)

As of December 31, 2008 and 2007, the Company recorded a provision of $1,173 and $3,257 respectively for ESPS, which in accordance with NIF B-3 “Income Statement” was included under other income and expenses in the statement of operations.

n. Employee benefits

Termination benefits for reasons other than restructuring and retirement to which employees are entitled are charged to operations for each year, based on actuarial computations using the projected unit credit method considering projected salaries. At December 31, 2008 and for purposes of recognizing benefits upon retirement, the remaining average service life of employees entitled to plan benefits approximates 29.5 years.

In conformity with NIF D-3 “Employee benefits” restructuring costs are presented in other expenses in the statement of operations.

o. Derivative financial instruments

The Company applied the provisions of NIF C-10, “Derivative Financial Instruments and Hedge Operations”, which, sets forth the criteria for recording, valuation and disclosure of all derivative financial instruments and embedded derivative financial instruments. The Company records assets and liabilities arising from such operations by its fair value on its balance sheet without any differentiation of their purpose or origin. The fair value of these derivatives is calculated within the accepted financial industry methods and data.

Changes in the fair value of such assets not qualified solely as accounting coverage are registered in the comprehensive financing cost within the results of operations

Risk Coverage

To mitigate exposure to Peso/Dollar foreign exchange fluctuation risks, the Company sparingly uses derivative financial instruments such as Interest Rate and Cross Currency Swaps.

F-22

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

For accounting purposes, these derivative instruments, although intended for hedging purposes from an economic perspective, have been designated as trading instruments as they do not comply with all the requirements to apply hedge accounting. Changes in the fair value of these derivative instruments are recognized in the statement of operations for the year in which such changes occur, under comprehensive financing cost.

Embedded Derivatives

The Company reviews the contracts it enters into to identify the existence of embedded derivatives. Identified embedded derivatives are subject to assessment under NIF C-10 to determine compliance with the required conditions. If conditions are met, they are segregated from the host contract and valued at their fair value. Where the embedded derivative is classified as being for trading purposes, the gain or loss from changes in fair value is recognized in the comprehensive financing cost in the statement of operations.

p. Revenue recognition

Revenues from the sale of telephone equipment to clients are recognized at the time of delivery of said equipment and the risk and rewards are transferred to the customer. Revenues from services are recognized as rendered.

Generally installation expenses are charged to our residential customers and related revenues are recognized when installation is complete.

Revenues from public telephony services are recognized based on the cash collected and the estimated uncollected cash from services rendered at the date of the financial statements.

Revenues from interconnection services are recognized an accrual basis. The Company entered into local interconnection agreements with various telephone companies under the “bill and keep” compensatory clause. In accordance with these agreements, if the imbalance between local calls originated from the other telephony company and completed by Maxcom, and the calls originated from Maxcom and completed by the other telephony company over the course of one month do not exceed an established percentage, there will be no payment of an interconnection rate charge to the user for interconnection services. However, if the imbalance exceeds that percentage in a particular month, the Company or the other party is subject to a charge per minute. The aforementioned percentage of imbalance was 5% during 2008 and 2007, and it was 15% during 2006.

F-23

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

The Company also has interconnection agreements for long-distance and mobile services with other telephony companies. However, they do not include the clause of the “bill and keep” compensatory agreement.

Revenues from pay television services are recognized as rendered.

Revenues from mobile telephone services are recognized on monthly basis when the traffic with suppliers of mobile telephony has been reconciled and the charge to the client has been recorded.

Also, for the mobile telephony revenues the Company recognizes through the suppletory application of the Emerging Issues Task Force standard 0021 or EITF 0021 “Revenue Arrangements with Multiple Deliverables” that evaluates the time and manner in which revenues for the different accounting units should be recognized. For the Company the separated accounting units are the sale of mobile telephony equipment and mobile services.

Revenue from bundled services is recognized in the month in which the services are provided. Bundle revenues are distributed among voice, data, pay TV or mobile services.

Revenues from lease of transmission capacity through the fiber optic ring are recorded in deferred revenue when billed in advance and then recognized ratably into revenue over the term of the contract.

The Company records an allowance in the amount of 90% of accounts receivable with balances due over 90 but less than 119 days old, and of 100% of accounts receivable due over 120 days old, except when there is a collection agreement with a client. In such cases, the allowance amount is 30% with balances due over 90 days if there is not a settlement negotiated with the client. Accounts handed over to the company’s legal collection services are reserved up to a 100%, or less depending on the success rate indicated by the attorney handling the account.

F-24

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

q. Business and credit concentration

The Company provides its services to a vast array of customers, thus avoiding dependency on any single customer.

The Company’s main suppliers are Radiomóvil Dipsa, S.A. de C.V., Telmex and Pegaso PCS, S.A. de C.V.. The cost percentage related to them for the year of 2008 was 72%.

r. Stock-options compensation

In July 2006, the Company decided to amend its different stock option plans to give better benefits to the holders of the options of those plans. Consequently, the Company changed the requisite service period as well as the strike price and vesting period on the different stock option plans. Granting conditions are included in the assumptions regarding the number of shares that are expected to become payable or the number of shares that employees receive. This estimate is revised annually and differences, if any, are charged or credited to the statement of operations, with an adjustment to shareholders’ equity.

Stock options are granted to members of the Board of Directors, Company officers and employees, as described in note 16.

The Company applies International Financial Reporting Standard (IFRS) No. 2 “Share-based Payments” (IFRS-2), for recognition, valuation and recording of the costs of these plans. IFRS-2 is applied in a suppletory basis in Mexico, as per NIF A-8 “Suppletory” from January 1, 2005 to December 31, 2008. See note 5u.

IFRS-2 requires that valuation of the cost of stock options granted to employees be estimated by applying the fair value method, for which the company hired an independent third party to carry out this computation. The total amount of the expense estimated under this method is amortized throughout the period granted, excluding the impact of any situation not related to market performance.

For the years ended December 31, 2008, 2007 and 2006, the Company recognized stock option plan costs of $5,114, $37,124 and $15,982, respectively.

F-25

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

The net amount of the stock options exercised, excluding any expenses or cost due to transactions related to the payment, are credited to shareholders’ equity and to additional paid-in capital at face value. On the other hand, cash received from exercised stock options is recorded as equity in additional paid-in capital. During 2008 and 2007, options were exercised in the amount of $70,672 and $1,281 respectively, while in 2006, there were no options exercised.

The fair value of options is estimated by an independent expert on the date they are granted, applying the binomial valuation model, by the Black & Scholes method, considering the following weighted-averages for stock options granted during the years ended December 31, 2007 and 2006, based on the following:

	2007			2006
Volatility of expected price per share		30.00	%		30.00	%
Risk-free interest rate		4.89	%		5.00	%
Expected life of options		3.25			3.50

During 2008 there were no granted options subject to fair value measurements.

s. Information by segments

Statement B-5 “Financial Information by Segments” of NIF requires that the Company review its internal organizational structure and internal reporting system for purpose of identifying segments. For the years reported on, the Company has operated only in the telecommunications business sector, identifying the following business segments: residential,
business, public telephony, wholesale and others.

The above segments represent a group within the telecommunications sector, thus most of the infrastructure is commonly used by business segments and equally specific telecommunications services, such as local service, long distance and “calling party pays” (CPP) that can be provided in one or more business segments.

Note 17 presents revenues by segments in the form management analyzes, manages and controls the business, Additionally, the information is displayed by geographic area, in compliance with the applicable NIF and a specific revelation that is required by the SCT in the concession title of the Company.

F-26

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

t. (Loss) earnings per share

Net basic (loss) earnings per share are calculated dividing the net (loss) income for the year by the weighted-average outstanding shares.

Diluted (loss) earnings per share are calculated by dividing the net (loss) income for the year by the weighted-average outstanding shares, plus stock options issued.

u. New accounting standards

The CINIF has issued the following NIFs, effective for years beginning after January 1, 2009, early application is not permitted.

NIF B-7 “Business acquisitions” —NIF B-7 supersedes Bulletin B-7 and establishes, among other things, the general rules for the initial valuation and recognition at the acquisition date of net assets, stressing that all business acquisitions should be accounted for using the purchase method.

Management estimates that the initial effects of this new NIF will not be material.

NIF B-8 “Consolidated and combined financial statements” — NIF B-8 supersedes Bulletin B-8 “Consolidated and combined financial statements and valuation of permanent investments in shares” and establishes the general rules for the preparation and presentation of consolidated and combined financial statements and related disclosures. Amendments include:

(i.) The obligation to consolidate special purpose entities (SPEs) when controlled.

(ii.) The possibility, under certain rules, of presenting unconsolidated financial statements when the parent is, in turn, a subsidiary with no minority interest or when the minority stockholders do not object to the fact that consolidated financial statements are not issued.

(iii.) Consideration is given to the existence of potential voting rights that might be exercised or converted in favor of the entity as parent and that may change its involvement in decision making at the time of assessing the existence of control.

(iv.) Additionally, regulations relating to the valuation of permanent investments have been transferred to a different bulletin.

F-27

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Management estimates that the initial effects of this new NIF will not be material.

NIF C-7 “Investments in associates and other permanent investments” — NIF C-7 sets forth the rules to account for investments in associates as well as other permanent investments where there is no control, joint control or significant influence. The principal changes with respect to the former standard include the following:

(i) Equity method of accounting is required for SPEs where significant influence is exercised.

(ii) Consideration is given to the existence of potential voting rights that might be exercised or converted in favor of the entity as parent and that may change its involvement in decision making at the time of assessing the existence of significant influence.

(iii) A specific procedure and a limit for recognizing the associated entity’s losses are provided.

Management estimates that the initial effects of this new NIF will not be material.

NIF C-8 “Intangible assets” — NIF C-8 supersedes Bulletin C-8 and establishes general rules for the initial and subsequent recognition of intangible assets acquired individually, either through the acquisition of a business or arising internally during the normal course of the entity’s operations. Main changes include:

(i) The definition of intangible assets is narrowed to establish that separability is not the only condition for the intangible asset to be identifiable;

(ii) Subsequent outlays for research and development projects in progress should be expensed as earned if they are part of the research phase or as an intangible asset if they meet the criteria to be recognized as such;

(iii) Greater detail is provided to account for the exchange of an asset, in accordance with the provisions of international standards and other NIF;

(iv) The presumption that an intangible asset may not exceed a useful life of twenty years was eliminated;

F-28

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Management estimates that the initial effects of this new NIF will not be material.

NIF D-8 “Share based payments” — NIF D-8 Establishes the valuation and accounting methods for goods or services paid for by shares. NIF D-8 is applicable to all purchases whose payments are liquidated by shares whether they are exercised through cash, shares, stock options payments or any combination of the aforementioned, excluding transactions with shareholders.

It is established within the NIF that any goods or services must be appraised at its fair value upon receipt.

With the application of this standard, the supplement of the International Financial Reporting Standard (IFRS) 2 was eliminated.

Management estimates that the application of this NIF will not be material, due to the previous suppletory application of International Financial Reporting Standard (IFRS) 2 “Share based payments”.

NOTE 6 — ACCOUNTING CHANGES AND RECLASSIFICATIONS:

The CINIF has issued the following NIF, effective for years beginning after December 31, 2008. Early application is not permitted.

(a) NIF B-10 “Effects of inflation” —NIF B-10 supersedes Bulletin B-10 “Recognition of the effects of inflation on the financial information” and its five amendment documents, as well as the related bulletins and Interpretation of Financial Reporting Standards (IFRS) 2. The principal considerations established by this NIF are:

(i) Recognition of the effects of inflation — An entity operates in a) an inflationary economic environment when cumulative inflation over the immediately preceding 3-year period is equal to or greater than 26%; and b) non-inflationary economic environment, when inflation over the aforementioned period is less than 26%.

For case a), the comprehensive recognition of the effects of inflation is required, (similarly to Bulletin B-10 being superseded). For case b), the effects of inflation are not recognized; however, at the effective date of this NIF and when an entity ceases to operate in an inflationary economic environment, the restatement effects determined through the last period in which the entity operated in an inflationary economic environment (in this case 2008), must be kept and shall be reclassified on the same date and using the same procedure as that of the corresponding assets, liabilities and stockholders’ equity. Should the entity once more operate in an inflationary economic environment, the cumulative effects of inflation not recognized in the periods where the environment was deemed as non-inflationary should be recognized retrospectively.

F-29

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

(ii) Price index — the use of the National Consumer Price Index (NCPI) or the change in the value of the Investment Unit (UDI) may be used for determining the inflation for a given period.

(iii) Valuation of inventories and of foreign machinery and equipment — The possibility of using replacement costs for inventories and specific indexation for foreign machinery and equipment is no longer allowed.

(iv) Equity adjustment for non-monetary Assets — On the effective date of this NIF, the unrealized portion of the equity adjustment for non monetary assets, which is maintained in stockholders’ equity, should be identified to be reclassified to earnings of the year when the originating item is realized. The realized portion or when is not practical to identify the unrealized portion, the realized and unrealized portions should be reclassified to retained earnings.

(v) Monetary Position Gains or Losses (included in Deficit/Excess in Equity Restatement) will be reclassified to retained earnings on the effective date of this NIF.

The 2007 and 2006 consolidated financial statements are presented expressed in constant pesos at December 31, 2007, the date on which the comprehensive method for recognizing the effects of inflation was last used.

(b) NIF D-3 “Employee benefits” — NIFD-3 supersedes Bulletin D-3 “Labor Obligations”, the sections applicable to Employee Statutory Profit Sharing (ESPS) of Bulletin D-4 and IFRS 4. The principal considerations established by this NIF are:

(i) Elimination of the recognition of an additional liability and the related intangible asset or any comprehensive item as a separate element of stockholders’ equity.

(ii) Employee benefits are classified in four principal categories; direct short-term and long term, termination and post-employment benefits. NIF D-3 establishes a maximum five-year period for amortizing unrecognized/unamortized items while actuarial gains or losses may be recognized as earned or incurred. Unlike termination benefits, post-employment benefits actuarial gains or losses may be immediately recognized in results of operations or amortized over the expected service life of the employees.

F-30

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

(iii) The use of nominal rates and the incorporation of the term salary increases due to promotions.

(iv) ESPS, including deferred ESPS, shall be presented in the statement of income as ordinary operations, preferably within “other income and expenses”. Furthermore, NIF D-3 establishes that the asset and liability method should be used for determining deferred ESPS; any effects arising from the change in method shall be recognized in retained earnings, without restatement of prior years’ financial statements.

As a result of the adoption of NIF B-3 “Income Statement”, in 2008 the intangible asset of $17,650 reflected in the balance sheet as of December 31, 2007 was eliminated. As of December 31, 2008 the effect of the recognition of items pending to be amortized on a five year period amounts to $2,776.

(c) NIF D-4“Taxes on income” — NIF D-4 supersedes Bulletin D-4 “Accounting for income and asset taxes and employee statutory profit sharing” and Bulletins 53 and 54. The principal considerations established by this NIF are:

(i) the balance of the cumulative IT effects resulting from the initial adoption of Bulletin D-4 in 2000 is reclassified to retained earnings, unless identified with any other comprehensive item pending reclassification. On January 1, 2008 there were no IT effects reclassified to retained earnings.

(ii) the accounting treatment of ESPS (current and deferred) is transferred to NIF D-3, as mentioned in paragraph (b) above.

(d) NIF B-2“Statement of cash flows” — NIF B-2 supersedes Bulletin B-12“Statement of changes in financialposition”and paragraph 33 of Bulletin B-16. The principal considerations established by this NIF are shown on the following page.

(i) Instead of the statement of changes in financial position, the financial statements shall include the statements of cash flows for all the periods presented comparatively with those of the current year, except for financial statements of periods prior to 2008;

(ii) Cash inflows and cash outflows are reported in nominal currency units, thus not including the effects of inflation;

(iii) Two alternative preparation methods (direct and indirect) are established, without stating preference for either method. Furthermore, cash flows from operating activities are to be reported first, followed by cash flows from investing activities and lastly by cash flows from financing activities;

(iv) Captions of principal items are to be reported gross, with certain exceptions and require disclosure of the composition of items considered cash equivalents.

F-31

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Accordingly, the Company presents the statement of changes in financial position for 2007 and 2006 as issued and the statement of cash flows for 2008 under the indirect method.

(e) NIF B-15”Translation of foreign currencies” — NIF B-15 supersedes Bulletin B-15 “Foreign currency transactions and translation of financial statements of foreign operations”. The principal considerations established by this NIF are:

(i)	Replacing integrated foreign operation and foreign entity concepts by those of recording, functional and reporting currencies, requiring that translation be made based on the economic environment in which the entity operates, regardless of its dependency on the holding company.
	Includes translation procedures for instances where the recording and reporting currencies differ from the functional currency and provides for the option not to conduct such translation in companies not subject to consolidation or valuation based on the equity method.

(ii) The accounting changes produced by the initial application of this standard shall be recognized based on the prospective method; that is, in a non-inflationary economic environment, without modifying the translation already recognized in the consolidated financial statements of prior periods, at the time of issue.

Reclassifications-

In order to comply with the NIF the employee’s statutory profit sharing amounting to $3,257 was reclassified in the 2007 statement of operations from selling, general and administrative expenses to other expenses.

F-32

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

NOTE 7 — TELEPHONE NETWORK SYSTEMS AND EQUIPMENT — NET:

As of December 31, telephone network systems and equipment consist of:

							Estimated
							useful
	2008			2007			life (years)
Telecommunications network and equipment	$	3,440,327		$	2,944,366			17
Public telephony equipment		582,734			377,916			8
Leasehold improvements		1,076,420			821,883			10
Radio equipment		397,444			330,736			30
Line installation cost		533,473			402,306			20
Electronic equipment		266,047			266,047			25
Capitalized expenses due to construction of networks		425,636			337,159			30
Capitalized comprehensive financing cost		241,235			66,525			10
Computer equipment		222,413			147,703			5
Transportation equipment		65,138			52,112			4
Office furniture		39,661			26,863			10
Other		28,179			20,476			10
Engineering equipment		20,450			13,227			10
Subtotal		7,339,157			5,807,319
Accumulated depreciation and amortization		(2,566,889	)		(2,082,785	)
Impairment charge (See note 5i)		(500,684	)		—
Subtotal		4,271,584			3,724,534
Construction in progress		412,829			464,412
	$	4,684,413		$	4,188,946

As of December 31, 2008 and 2007 the estimated cost remaining to conclude the construction in progress was of $399,712 and $444,569, respectively and management expects to conclude them before December 31, 2009 and 2008, respectively.

As of December 31, 2007 the Company reclassified optical fiber and links in the amounts of $140,200 for 2007, from intangible assets to telephone network systems and equipment. For 2008 the optical fiber and links were already classified into it.

For the years ended December 31, 2008, 2007 and 2006, the Company recorded depreciation and amortization expenses of $480,807, $306,904, and $198,410, respectively.

F-33

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

As part of the agreements entered into with the holders of Bonds issued on December 20, 2006, as mentioned in note 11, the Company committed all of Maxcom’s telephone network systems and equipment as a warranty in favor of said bond holders.

Although the assets mentioned above have been encumbered in favor of the bond holders, the Company can make use of those assets as long as the requirements and conditions established in the instruments that govern issuance of the bonds are met.

The Company entered into financial lease agreements with Autoarrendadora Integral, S.A. de C.V. in pesos and U.S. dollars, for transportation equipment. See note 20.

The gross amount of fixed assets acquired under leases that are capitalized as of December 31 is comprised as follows:

	2008		2007
Transportation equipment	$	4,740		3,534
Total	$	4,740		3,534

NOTE 8 — INTANGIBLE ASSETS:

As of December 31, intangible assets are comprised as follows:

							Useful
	2008			2007			life (years)
Infrastructure rights	$	178,964		$	178,964		30 and 15
Debt issuance costs		62,283			60,340			8
Software licenses		273,941			213,543			3.3
		515,188			452,847
Accumulated amortization		(285,238	)		(244,045	)
Impairment charges for intangible assets (See note 5i)		(20,267	)		—
	$	209,683		$	208,802

F-34

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

As of December 31, 2007 the Company reclassified optical fiber and links from infrastructure rights to telephone network systems and equipment. See prior comment in note 7.

For the years ended December 31, 2008, 2007 and 2006, the Company recorded amortization expense of $41,194, $35,896 and $58,179, respectively; including $24,775, $21,074 and $14,384 corresponding to software amortization, respectively.

As a result of the debt issuance made on December 20, 2006 (see note 11), the Company recorded other expenses in the amount of $17,671 in the 2006 statement of operations, as a result of the overall amortization of the costs of debt issuance of the previous bonds that were paid in advance. See note 5e.

NOTE 9 — FREQUENCY RIGHTS:

As of December 31, frequency rights are analyzed as follows:

	2008			2007
Frequency rights	$	155,309		$	155,309
Less — Accumulated amortization		(82,144	)		(74,379	)
Impairment charges (See note 5i)		(6,449	)		—
	$	66,716		$	80,930

For the years ended December 31, 2008, 2007 and 2006, the Company recorded amortization expenses of $7,765, $7,444 and $7,444, respectively.

F-35

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

NOTE 10 — BALANCES AND TRANSACTIONS WITH RELATED PARTIES:

For the years ended December 31 2008, 2007 and 2006, related party transactions are analyzed as follows:

	2008		2007		2006
Commission and administrative services paid to:
BBG Wireless (1)	$	7,709		—		—
Electromecánica de Guadalajara, S. A. de C. V. (2)		5,697		7,425 -
Automotriz Rio Sonora (3)		5,122		—		—
Road Telco & Consulting, S. A. de C. V. (5)		1,975		2,309		1,639
GS Comunicación (6)		1,063		—		—
Autokam Regiomontana, S. A. de C. V. (3)		844		343		—
Ingeniería Avanzada en Construcción, S.A. de C.V. (7)		765		—		—
Vázquez Eduardo (8)		480		459		—
Vázquez Gabriel Agustín (8)		480		459		—
Solís Gilberto (6)		332		—		—
Bank of America, Co. (9)		315		378		397
Inmobiliaria Radio Centro (8)		264		—		—
MG Radio (4)		101		—		—
Inmobiliaria AutoKam, S. A. de C. V. (8)		101		98		—
Aguirre Adrián (10)		31		—		—
Sierra Madre Automotriz, S. A. de C. V. (3)		—		318		—
Comercializadora Road el Camino, S. A. de C. V. (11)		—		—		323
Advertisement services provided by Difusión Panorámica, S. A. de C. V. (4)		—		—		22
Total	$	25,279	$	11,789	$	4,351
Revenues from telephony services collected from related parties	$	966	$	1,020	$	940

(1)	Corresponds to cluster construction.
(2)	Corresponds to interest payments and a portion of the capital pertaining to a loan to settle Telereunion’s debt with the Comisión Federal de Electricidad (CFE). See note 20.
(3)	Corresponds to costs related to the purchase of vehicles.
(4)	Corresponds to advertising services.
(5)	Mr. Adrián Aguirre (Maxcom shareholder) is also a shareholder of Road Telco & Consulting, S. A. de C. V. The transactions correspond to administrative services and sale of telephone lines.

F-36

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

(6)	Corresponds to payments regarding marketing consulting services.
(7)	Corresponds to the installation of public telephones.
(8)	Corresponds to lease of sites and offices owned by a relative of a Maxcom shareholder.
(9)	Corresponds to expenses related to the debt restructuring and travel expenses of Bank of America (Maxcom shareholder).
(10)	Corresponds to expenses reimbursed.
(11)	Mr. Adrián Aguirre (Maxcom shareholder) is also a shareholder of Comercializadora Road el Camino, S. A. de C. V. Transactions correspond to administrative services and sale of telephone lines.

The accounts receivable and payable arising from operations with related parties as of December 31, 2008 and 2007 were the following:

	2008		2007
Accounts Receivable:
Porcelanatto, S. A. de C. V.	$	29		—
Guijarro de Pablo y Asociados, S.C.		21		—
Difusión Panorámica, S. A. de C. V.		15		—
Proa Mensaje y Comunicación, S. A. de C. V.		11		—
Road Telco & Consulting, S. A. de C. V.		9		—
Sport and Therapy Center, S. A. de C. V.		8		—
Safe Iberoamericana, S. A. de C. V.		1		—
Shareholder María Guadalupe Aguirre Gómez		1		—
Shareholder María Elena Aguirre Gómez		1		—
Shareholder Gabriel Vazquez		1		—
Shareholder Ricardo Arevalo Ruíz		—		2
	$	97		2

F-37

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

	2008		2007
Accounts Payable:
Electromecánica de Guadalajara, S. A. de C. V.	$	36,091		36,370
Autokam Regiomontana, S. A. de C. V.		441		—
GS Comunicación, S. A. de C. V.		244		—
Automotriz Río Sonora, S. A. de C. V.		236		—
Ingenieria Avanzada en Construcción, S. A. de C. V.		112		—
Nexus Partners		30		—
Inmobiliaria Radio Centro		25		—
Shareholder Adrián Aguirre Palme		22		—
Shareholder Eduardo Vazquez		—		36
Shareholder Gabriel Vazquez		—		36
Road Telco & Consulting, S. A. de C. V.		—		23
Inmobiliaria Autokam, S. A. de C. V.		—		8
	$	37,201		36,473

Accounts payable and receivable from related parties are included within accounts receivable customers and trade accounts payable, respectively.

NOTE 11 — BONDS PAYABLE:

As of December 31, 2008 and 2007, bonds payable were comprised as follows:

	2008		2007
Long term:
Senior Notes maturing in 2014, bearing interest at a fixed annual rate of 11%, payable semiannually as from June 15, 2007.	$	2,707,660	$	2,173,240

On April 2, 2007, the Company paid the 11,590 dollars due on the “B Series Bonds” issued on March 17, 2000 bearing an interest rate of 13.75% and maturing at April 1, 2007.

On December 20, 2006, the Company issued debt instruments denominated “Bonds” in the international markets in the amount of 150.0 million dollars in accordance with Rule 144A and Regulation S, both part of the U.S. Securities Act of 1933. On January 10, 2007 and September 5, 2007, the Company issued additional Bonds in the amount of $25.0 million dollars each, on the same global offer and under the same terms as those of the initial placement.

F-38

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

As of December 31, 2008 and 2007, accrued interest payable on these bonds amounted to $13,920 and $11,172, respectively.

As part of the agreements reached with the Bondholders, the Company agreed to encumber, in order of priority and degree, in favor of said Bondholders, the fixed assets that comprise the item “Telephone Network System and Equipment”, including, but are not limited to constructions, transportation equipment and vehicles, computers, information electronic data processing equipment, telecommunications and office furniture and equipment, as well as all the assets comprising the item denominated “Telephone Network System and Equipment” pertaining to the assets shown in the balance sheet. The guarantee was perfected on February 13, 2007 through a voluntary mortgage set up in order of priority and degree.

Even though the above-mentioned assets have been pledged to the Bondholders, the Company can make use of said assets, provided the requirements and conditions established in the instruments that govern the issuance of the bonds are met.

The main characteristics of this Bond issue are that it: a) represents preferential liabilities of the Company (subject to the mortgage mentioned in the paragraphs above); b) “pari passu” (equal rights and conditions like any other similar debt entered into by the issuer) on payment rights on all current company principal debt; c) is considered a secondary debt in regards to any debt contracted with the acquired fixed assets pledged as guarantee; d) is considered preferential debt in regards to any future principal debt of the Company; and e) is unconditionally guaranteed by the shares of all the Company’s subsidiaries, except by the shares of Grupo Telereunion companies, which were pledged beginning in 2009, and f) is subject to registration before the Securities and Exchange Commission (SEC), in accordance with the Registration Rights Agreement.

On November 19, 2007 the bonds exchange program was completed for an approximate amount of 200.0 million dollars and registered with the U.S. Securities and Exchange Commission with the same characteristics of maturity, interest rate and almost all other characteristics.

The aforementioned bonds contain positive and negative covenants, which have been duly complied with as of December 31, 2008 and 2007.

F-39

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Interest paid abroad is subject to income tax withholding at a rate of 4.9%, payable by the Bondholder and interest is payable net. As of December 31, 2007, the Company released the funds classified as restricted cash, in light of the fact that the trust set up as an alternate source of payment of the loans contracted with IXE, Banco Mercantil del Norte, S. A. and a derivative financial instrument operation were cancelled on December 2007.

NOTE 12 — FOREIGN CURRENCY POSITION:

Figures in this note represent thousands of US dollars.

As of December 31, the Company’s foreign-currency position was as follows:

	2008			2007
Assets		121,987			223,278
Liabilities		(221,164	)		(223,196	)
Net (liabilities) assets in dollars		(99,177	)		82
Exchange rate at end of the year ($1 to the 1.00 dollar)	$	13.54		$	10.87

As of December 31, 2008 the Company had engaged in measures to mitigate its exposure to exchange rate risk, for further explanation of these measures see Note 13.

F-40

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

NOTE 13 — DERIVATIVE FINANCIAL INSTRUMENTS:

Explicit Derivatives

As of December 31, 2008 the Company had entered into two swap transactions covering interest and exchange rates with two different parties, but with the same characteristics. In both cases the Company pays every six months interest over a notional amount in pesos and receives interest over a notional amount in dollars; at maturity the Company must pay the notional amount in pesos and will receive the notional amount in dollars. These instruments were not qualified as hedges, so any change in their fair value is recorded in the comprehensive financing cost in the statement of operations for the period in which the change occurred. As of December 31, 2008, the fair value of the swaps totaled $ 105,270, which is divided as follows:

Cross Currency Swaps:

			Effects in operations
Counter-party	Notional	Basic conditions	2008			2007
Bank Morgan	75,000	Interest Received: 11%		(52,820	)		(4,563	)
Stanley AG	USD	Periodicity: Semi-annual
		Maturity: December 15, 2010
	(808,200)	Interest Paid: 11.505% (Fixed)
	MXP	Periodicity: Semi-annual
		Maturity: December 15, 2010
Merrill Lynch	75,000	Interest Received: 11%		(52,450	)		(4,352	)
Capital Markets	USD	Periodicity: Semi-annual
AG		Maturity: December 15, 2010
	(808,200)	Interest Paid: 11.505% (Fixed)
	MXP	Periodicity: Semi-annual
		Maturity: December 15, 2010

F-41

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Embedded Derivatives.

As of December 31, 2008, the Company indentified within its leasing contracts 7 embedded derivatives which were separated from their host contract. All of the derivates were found to emulate explicit exchange rateforwardsbetween Mexican pesos and U.S. dollars at different maturities. These could not be qualified by the Company as hedge accounting, so any change in their fair value is recorded in the comprehensive financing cost in the statement of operations for the period in which the change occurred. As of December 31, 2008, the fair value of theforwards amounted to $ (8,472), which is divided as follows:

Host Leasing			Effects in operations
Contract	Notional	Maturity	2008
MATC Digital	0.5	October 2009		0.02
(San Marcos)	USD
MATC Digital	0.8	September 2009		23
(E. Zapata)	USD
MATC Digital	0.3	June 2009		5
(Chiquihuite)	USD
Grande River	0.9	October 2009		26
Communications	USD
Enlace Digital	2.5	September 2009		(34	)
Telecomunicaciones	USD
CarrierCOM	1.5	February 2009		12
	USD
Grupo Promotor	151	December 2012		8,440
Jomer	USD

NOTE 14 — LABOR OBLIGATIONS UPON RETIREMENT:

As of December 31, 2008 and 2007 the Company has direct benefits payable for absences (non-cumulative) amounting to $1,133 and $1,097, respectively.

As of December 31, 2008 the Company incurred restructuring charges of $49,491, which are comprised of $45,679 of termination benefits and $3,812 of legal and administrative expenses.

The Company has no retirement or post retirement benefit or pension plans for its employees, aside from the benefits described in the next sentence. Obligations and costs of seniority premiums and termination benefits that employees are entitled to receive are recognized based on actuarial studies prepared by an independent third party specialist.

F-42

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

	Benefits
	2008
	Termination		Retirement		Total		2007
Net cost for the year:
Labor cost	$	1,552		2,983		4,535		3,629
Financial cost		698		2,027		2,725		1,091
Actuarial loss		5,899		—		5,899		—
Prior service (2007 unamortized items):
Amortization of prior service cost and plan modifications		964		2,951		3,915		—
Amortization of transition liability		—		—		—		1,032
Net cost for the year	$	9,113		7,961		17,07		4 5,752

The present value of benefit obligations of the plans at December 31, 2008 is as follows:

	Benefits
	Termination			Retirement			Total
Current benefit obligation (CBO)	$	11,514			25,836			37,350
Unrecognized items:
Transition liability		(3,856	)		(11,175	)		(15,031	)
Actuarial loss		—			(693	)		(693	)
Projected liability, net	$	7,658			13,968			21,626

F-43

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

The present value of benefit obligations of the plans at December 31, 2007 is as follows:

	Benefits obligations
	by concept of:
	Seniority
	Premium			Severance
Current benefit obligation (CBO)	$	1,283			24,906
Present liability, net		1,283			24,906
Minus: projected liability, net		(1,283	)		(7,256	)
Additional liability	$	—			17,650
Projected benefit obligation (PBO)	$	1,480			33,002
Unrecognized items:
Transition asset (liability)		507			(19,295	)
Actuarial loss		(310	)		(6,452	)
Projected liability, net	$	1,677			7,255

The following reconciles the beginning and final balance for the present values of the CBO as of December 31, 2008:

				Benefits
	Termination			Retirement			Total
CBO at the beginning of the year	$	33,002			1,480			34,482
Current labor cost		4,049			487			4,536
Financial Cost		2,608			118			2,726
Yearly real payments charged to the allowance		(3,939	)		(442	)		(4,381	)
Actuarial (loss) gain for the period		(64	)		51			(13	)
CBO at the end of the year	$	35,656			1,694			37,350

F-44

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

The following chart presents the CBO amounts for the years of 2008, 2007, and 2006:

	2008		2007		2006
Retirement/Seniority Premium:
CBO	$	1,694		1,480		1,125
Total actuarial loss		360		311		246
Termination:
CBO	$	35,656		33,002		25,979
Total actuarial loss		6,233		6,452		1,365

	Benefits
	2008			2007
Discount rate reflecting the value of the current obligations		8.16	%		8.16	%
Compensation increase rate		5.56	%		5.56	%
Employee Remnant Average Labor Life (Applicable to benefits upon retirement)	29.5 years			28.90 years

NOTE 15 — SHAREHOLDERS’ EQUITY:

Under the Mexican Federal Telecommunications Law and the Foreign Investment Law, no more than 49% of the voting capital stock of a Mexican corporation holding a concession to provide local and long-distance telecommunications services may be held by foreigners.

On April 11, 2002, the Company obtained authorization from the Mexican Foreign Investment Bureau(“Dirección General de Inversión Extranjera”)to increase its ability to issue limited voting shares up to 95% of its total capital stock.

F-45

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

On July 17, 2006, the Company’s shareholders decided to simplify the Company’s shareholding structure, as a result of which, all preferred shares were converted to common shares, eliminating the preferred liquidation rights of certain shares, which represented, at the time of the conversion, approximately 95% of the capital stock. To eliminate the preferred rights that would have been generated in the event of Maxcom’s liquidation or an analogous liquidation, the shareholders approved payment of dividends per share to preferred shareholders, which were equal to the liquidation price estimated per preferred share at the date of payment. Payment was made in shares. Shareholders holding preferred shares received an additional amount of 126,297,257 common shares.

In accordance with the provisions of NIF C-11 “Shareholders’ Equity”, the increase in the number of shares in circulation resulting from this payment of dividends per share had no effect on the accounting, as the value of shareholders’ equity remained unchanged.

All series of preferred shares were converted to common shares. In this regard, as per the agreements reached, the conversion was as follows:

• 6,088,896 Series “A-1” shares to Series “A” shares, at a one to one ratio;

• 10,181,950 Series “B-1” shares to Series “B” shares, at a one to one ratio;

• 220,714,874 Series “N-1” shares to Series “N” shares, at a one to one ratio, and

• 26,867,820 Series “N-2” shares to Series “N” shares, at a one to one ratio.

Series “A” and “B” preferred shares had full voting rights, and Series “N” shares were neutral shares with limited voting rights and were not considered in the determination of the foreign investment percentage, in accordance with the Foreign Investment Law and can be subscribed and acquired by either Mexican or foreign investors.

In accordance with the General Corporations Law, and with the Company’s bylaws, it is not possible to issue new shares or agree any modification in the number of shares due to a capital increase, reduction, amortization or spin off, unless all shares previously issued have been entirely paid. Therefore, treasury shares were totally cancelled and re-issued each time stockholders reached an agreement in that sense.

As a result of the acquisition of Grupo Telereunion companies, described in note 3b., at the General Shareholders’ meeting held on July 17, 2006, Grupo VAC (the former owners of the Grupo Telereunion companies) subscribed a 31.2 million dollar increase in Maxcom’s capital stock equivalent to $364,276 or 16.34% of the total Company’s shares. From this capital stock subscription, Maxcom received 22.7 million dollars in cash and the outstanding shares of Telereunion, S. A. de C. V., Telscape de México, S. A. de C. V. and Sierra USA Communications, Inc. valued at a fair value of 8.5 million dollars.

F-46

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

On February 26, 2007, at the Extraordinary and Ordinary Shareholders Meetings it was decided to increase the variable portion of the capital stock of the Company in the amount of 58 dollars, by issuing 830,000 common Series “N” shares that represent the capital stock of Maxcom, which were subscribed by a number of officers of Maxcom at a subscription price of 0.07 dollars per share.

On April 1, 2007 a number of holders of warrants issued in year 2000 exercised their warrants in respect of 736,883 Series “N” common shares that represent the capital stock of Maxcom at a price of 0.01 dollars per share.

On September 13, 2007, by means of resolutions adopted by the General Extraordinary and Ordinary Shareholders Meetings, the following resolutions were adopted.

1.	To make a public offering of Ordinary Participation Certificates (CPO) in Mexico, in the form of shares by offering these securities at the Bolsa Mexicana de Valores, S.A. B. de C.V. and other foreign markets in the form of American Depositary Shares (ADS) or other securities or instruments representing the CPOs or the shares of the Company, in accordance with applicable laws, including, without limitation, the US Securities Act of 1933, and upon registration of the corresponding securities with the Securities and Exchange Commission, so that the necessary funds may be raised in order to continue the development and growth of the Company and pay its debts. The CPOs are equivalent to three shares and the ADSs are equivalent to seven CPOs.
2.	The conversion and/or reclassification of all the shares under the Series “A”, “B”, and “N”, into new common and registered Series “A” shares with no par value, representing both the fixed and the variable portion of the capital stock, as applicable.
3.	Amend the Company’s overall bylaws, including the creation of a number of intermediate management bodies, and other changes required under the Mexican Stock Market Law to convert the Company to a publicly traded company (“Sociedad Anónima Bursátil” or S. A. B.).
4.	Cancel 45,768,803 of the Company’s treasury shares.
5.	Increase the variable capital stock by issuing up to 260,000,000 common and registered Series “A” shares with no par value, representing the variable portion of the capital stock of the Company and 45,768,803 registered Series “A” shares, with no par value, representing the variable portion of the capital stock, to be kept at the treasury.

F-47

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

On October 19, 2007, Maxcom completed the global offering by placing 304,608,201 Series “A” shares under the primary offering, including the over-allotment option, and 50,909,091 Series “A” shares under the secondary offering, all of them registered shares with no par value, representing the variable portion of the capital stock of the Company, among public investors. The gross amount of the proceeds obtained from the offering, taking into account the primary
offering and the over-allotment option was $2,751,713, and the issuance expenses amounted to $100,931, net from tax effects.

In the end of October, 2007 certain officers and directors of the Company exercised options corresponding to the stock option plan to acquire 853,592 Series “A” shares representing the capital stock of the Company.

In light of the above, the outstanding capital stock of Maxcom at December 31, 2008 and 2007 is comprised of 1,528,827 Series “A” shares that represent the fixed portion thereof and 788,290,002 Series “A” shares that represent the variable portion thereof.

On March 24, 2008, by means of resolutions adopted by the General Extraordinary and Ordinary Shareholders Meetings, the shareholders approved the share repurchase regulations, also the shareholders approved an amount of up to $36,196 destined to the share repurchase program for 2008, without limitation on the amount of shares to be bought. In 2008, the net effect of share repurchases was a loss of $7,320 that is included within additional paid-in the capital.

As of December 31, 2008 the Company holds 5,129,900 treasury shares repurchased in the amount of $20,287.

On October 17, 2008 the Shareholders approved an equity reduction to the variable part of the capital stock for up to 1,683 dollars due to residual shares or Ordinary Participation Certificates or “CPOs” left from the issuance of American Depositary Shares or “ADSs”. The reduction amounted to $7.

Also on October 17, 2008 by means of resolutions adopted by the General Extraordinary and Ordinary Shareholders Meetings, the shareholders authorized the Executive Incentive Program and the compensation awarded to counselors and members of the Company’s different committees.

F-48

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

At the same meeting, the shareholders authorized an increase of the variable portion of the capital stock of the Company up to 11,000,000 Series “A” Class II shares to be held as treasury shares to fulfill the terms of section 7 of the Company’s by-laws for the commitments arising from the Executive Incentive Program. See Note 16.

As of December 31, the shares representative of the Company’s capital stock are nominative, with no par value and were comprised as shown below:

Series and Class of Shares	2008		2007		2006
Issued and outstanding:
Series “A” Class I (fixed portion)		1,528,827		1,528,827		1,528,827
Series “A” Class II (variable portion)		788,290,002		788,290,002		15,760,793
Series “A1” Class II (variable portion)		—		—		—
Series “B” Class II (variable portion)		—		—		16,611,595
Series “B1” Class II (variable portion)		—		—		—
Series “N” Class II (variable portion)		—		—		448,433,563
Series “N1” Class II (variable portion)		—		—		—
Series “N2” Class II (variable portion)		—		—		—
Subtotal		789,818,829		789,818,829		482,334,778

Authorized shares not outstanding:
(treasury shares)

	2008		2007		2006
Series “A”		11,000,000		307,010		—
Series “N”		—		—		45,901,176
Series “N1”		—		—		—
Subtotal		11,000,000		307,010		45,901,176
Total authorized shares		800,818,829		790,125,839		528,235,954

F-49

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

In the event of a reduction to the capital stock or to the share subscription premium any surplus of the amount reimbursed over the balances of the accounts of contributed capital, a tax equivalent to 38.89% shall be incurred, when paid in the future. The tax incurred shall be paid by the Company and may be credited against the Income Tax for the fiscal year, or the Income Tax for the two immediately following fiscal years.

As of December 31 2008 and 2007, the Company’s capital stock was comprised as follows:

	2008		2007
Capital stock	$	4,814,428		4,814,435
Restatement effect		595,816		595,816
Total capital stock	$	5,410,244		5,410,251

NOTE 16 — STOCK OPTION PLAN:

Through June 30, 2006, the Company had the following stock option plans:

a.	Executive plan — under the aforesaid plan, there were 575,000 stock options available as a grant for officer’s performance for the years of 1998, 1999 and 2000.
b.	New stock option plan for executives — As of December 31, 2005, the Board of Directors and shareholders of the Company authorized an aggregate of 17,998,500 options to remunerate officers for the services they rendered during the years 2002, 2003 and 2004. Also, part of these options served as extraordinary remunerations granted to certain key officers in case of a change in the control of the Company.
c.	Members of the Board of Directors and members of various committees — For each meeting of the Board or of the different committees of the Company where directors and members of the different committees attend, they receive an option to purchase 2,500 shares at an exercise price of 0.01 dollars per share. The chairman of the Board or of the different committees is entitled to receive options to subscribe 5,000 shares at the same above mentioned exercise price. Options granted in each meeting may be exercised immediately and expire three years after, beginning on the date when granted, except when the same Board or the shareholders’ meeting provides another mechanism.
d.	Signing bonuses and other bonuses for officers or directors — From time to time the Company has granted signing bonuses, special bonuses and other bonuses by way of stock options. There was a reserve of 246,215 N1 Series, Class II treasury shares, available so that the management or the Board of Directors may grant options on these shares as part of the signing bonuses negotiated and signed to contract new key officers with the Company.

F-50

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

The fair value of options for services rendered was determined by an independent third party using a binomial valuation model applying the Black & Scholes method.

Following is a summary of the changes in employees’ stock option plans for the year ended on December 31, 2008, 2007 and 2006 and the changes to the stock option plans for the acquisition of shares by entities other than employees (in thousands of shares):

	2008					2007					2006
				Weighed					Weighed					Weighed
				Average					Average					Average
				Exercise					Exercise					Exercise
	Options			Price USD		Options			Price USD		Options			Price USD
Outstanding at beginning of year		37,277		$	0.37		36,651		$	0.38		18,099		$	0.65
Granted		552			0.01		5,151			0.25		36,076			0.24
Exercised		(11,041	)		0.06		(339	)		0.31		—			—
Cancelled		—			—		(4,186	)		0.27		(17,524	)		0.65
Outstanding at the end of the year		26,788			0.31		37,277			0.37		36,651			0.38
Options exercisable at the end of the year		14,751			0.31		21,208			0.41		7,112			0.99
Weighted average price of options granted during the year (denominated in U.S. dollars)				$	0.01				$	0.25				$	0.24

A summary of the status of the Company’s non vested granted options as of January 1, 2008, and changes during the year ended December 31, 2008, is presented below (in thousands of shares):

				Weighted
				average
				grant-date
Non vested granted Options	Options			fair value
Balance at January 1, 2008		13,656		USD	0.10
Vested		(5,118	)		0.10
Forfeited		(5,373	)		0.10
Balance at December 31, 2008		3,165		USD	0.10

F-51

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

A summary of authorized options for employees’ stock option plans as of December 31, 2008 and 2007, is presented below (in thousands of shares):

	2008		2007
Granted		17,916		35,272
Granted/Vested		14,751		21,616
Granted nonvested		3,165		13,656
Available		8,872		2,005
Total authorized options		26,788		37,277

A summary of the status of the Company’s granted vested options as of January 1, 2008, and changes during the year ended December 31, 2008, is presented below (in thousands of shares):

				Weighted
				average
				grant-date
Granted/Vested Options	Options			fair value
Balance at January 1, 2008		21,616		USD	0.12
Granted		552			0.15
Exercised		(11,041	)		0.07
Vested		5,118			0.10
Forfeited		(1,494	)		0.12
Balance at December 31, 2008		14,751		USD	0.14

Since all of our stock option plans are out of the money, for 2009, we do not expect to repurchase any of the Company’s shares to fund them.

F-52

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

A summary of the cash used for the Company’s exercised options for the year ended December 31, 2008, is presented below:

				Weighted						Weighted						Weighted
	Stock			average			Directors			average						average
	Option			unit price			&			unit price						unit price
	Plan			USD			Officers			USD			Total			USD
Cash out for share acquisition		72,450			6.6			9,384			6.3			81,834			6.5
Cash in from exercised options		(7,082	)		(0.6	)		(4,079	)		(2.7	)		(11,161	)		(0.9	)
Total		65,368			5.9			5,305			3.5			70,672			5.6

In July 2006, the Company increased its capital stock by 16.34% of the Company’s outstanding shares, as described in note 15. As a result of this transaction, the Company’s shareholders decided to simplify the Company’s shareholding structure, changing all preferred shares to common shares, after canceling preferential rights in the event of liquidation.

This change produced that the fair value of the Company’s shares increased from 0.00 to 0.31 dollars on common stock and from 0.28 to 0.31 dollars on its preferred stock.

Together with this change in its capital structure the Company decided to amend its different stock option plans to give better benefits to the holders of the options in such plans. As a result in July 2006, the Company changed the requisite service period as well as the strike price and vesting period in the different stock option plans as explained as follows:

	Modified plan				Previous
	2007		2006		Plan
Requisite service period	3 years		3 years		5 years		(*)
Fair value on modification date (dollars)		0.149		0.090		0.000
Exercise price (dollars)		0.31		0.31		0.50
Unrecognized compensation cost in July 2006 (in dollars: 0 x 23,837,331 options)		—		—		N/A

(*) At the modification date most options had been already vested.

F-53

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

The additional compensation cost stemming from the modification and the total compensation cost per option is 0.09 dollars as shown below:

	Dollars
Fair value of modified option at July 2007		0.149
Fair value of modified option at July 2006		0.090
Fair value of original option at July 2006		0.000
Incremental value of modified option at July 2007		0.149
Incremental value of modified option at July 2006		0.090
Incremental value of modified option at July 2007		0.149
Incremental value of modified option at July 2006		0.090
Unrecognized compensation cost for original option		0.000
Total compensation cost to be recognized in 2007		0.149
Total compensation cost to be recognized in 2006		0.090

The total remaining compensation cost at December 31, 2008 amounted to $1,114 will be recognized over the modified award’s three-year requisite service period. Accordingly, the Company’s compensation cost will be recognized ratably over the remaining three years. The cost related to these plans recognized for the years ended December 31, 2008 and 2007 amounted to $5,114 and $37,124, respectively. The compensation cost for “penny warrants” for directors and options for executives are recognized in shorter periods, because it relates to performance bonuses and their fair value fluctuates between 0.15 and 0.38 dollars each.

As of December 31, 2007, the Company had issued options to purchase 7,569,007 shares pursuant to severance arrangements with certain of our key officers that, upon a change of control or an initial public offering of Maxcom, became fully exercisable without restriction. As of October 18, 2007 these options were fully exercisable and the compensation cost recognized amounted to $25,300. The majority of these options were exercised during 2008.

F-54

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

After amending the different stock option plans, the breakdown of the options granted and their vesting periods as of December 31, 2008 are described below:

	New			Plan for the		Options for Board
	employee stock			Chairman		members and
	option plan			of the Board		executives		Total
Granted		17,339,922			4,385,781		1,827,845		23,553,548
Expected forfeitures		(3,467,984	)		—		—		(3,467,984	)
Outstanding options authorized		17,871,587			—		1,057,055		18,928,642
Options vested during the year		1,817,543			1,330,800		9,357,457		12,505,800

	2008			2007
Authorized options		43,961,391			44,915,241
Options granted		(25,032,749	)		(42,471,437	)
Available options		18,928,642			2,443,804

The fair value of the stock options of the new plan was computed by an independent third party specialist, using a binomial valuation model by the Black & Scholes method.

Black-Scholes assumptions at 2007:

Vesting Period	Volatility			Exercise Price	Risk Free Rate			Fair value
3.25 years		30	%	0.31 dollars		4.89	%	0.149 dollars

Black-Scholes assumptions at 2006:

Vesting Period	Volatility			Exercise Price	Risk Free Rate			Fair value
3.5 years		30	%	0.31 dollars		5.00	%	0.090 dollars

F-55

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

On October 17, 2008, by means of resolutions adopted by the General Extraordinary and Ordinary Shareholders Meetings, the shareholders ratified the Executive Incentive Program and the compensation awarded to counselors and members of the Company’s different committees. In both cases a portion of the payments is awarded through shares, as described below:

A) Employee Incentive Program.

a.	The yearly incentive goal, which may be given to the Company’s officers and employees who are eligible under the scope of the Executive Incentive Program, is to reward management for value generation to the Company in a given period of time.
b.	The minimum requirement for the incentives to be awarded is a value generation of 15% year versus year. The following formula is how value generation is calculated:
	Value Generation for the year = EBITDA * 8 (eight) — net indebtedness + shareholders’ dividends — shareholders’ increase to the capital stock.
c.	The amount of the yearly incentive is allocated individually and is subject to the yearly performance evaluation.
d.	The yearly incentive is divided into three parts:

i.	One part will be awarded through cash.
ii.	One part will be awarded through stock options in order to receive ADRs, CPOs or any other instrument whose underlying values represent Maxcom’s capital stock.
iii.	One part will be awarded through stock options in order to receive ADR’s, CPO’s or any other instrument whose underlying values represent Maxcom’s capital stock.

Under this plan there have not been any options granted, due to the fact that the conditions required at the Shareholder’s Meeting to grant the incentives were not met.

B) Compensation for Directors and Committee members.

a. Directors and Committee members will receive each year options to purchase up to $120 in the form of CPOs, with the exception of the Chairman of the Board who will receive each year options to purchase up to $240 in the form of CPOs.

F-56

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

As of December 31, 2008 changes in additional paid in capital were as follows:

	2008
Issuance expenses, net	$	(6,055	)
Stock option plan cost		5,114
Cost of shares acquired for issuance upon exercise of stock options net		(70,672	)
	$	(71,613	)

NOTE 17 — FINANCIAL INFORMATION BY SEGMENTS AND BY GEOGRAPHICAL LOCATION:

The following chart presents a breakdown of the business segment according to the way management operates.

For the years reported on, the Company has operated only in the telecommunications business sector, identifying the following business segments: residential, business, public telephony, wholesale and others. The above segments represent a group within the telecommunications sector, thus most of the infrastructure is commonly used by business segments and equally specific telecommunications services, such as local service, long distance and “calling party pays” (CPP) that can be provided in one or more business segments. The revenue is divided as shown below:

Segment	2008			2007			2006
Residential	$	1,055,639			897,855			685,492
Business		809,130			648,165			495,433
Public Telephony		428,733			386,404			253,136
Wholesale		359,518			376,092			262,304
Others		30,209			37,203			45,327
Total revenues	$	2,683,229			2,345,719			1,741,692
Operating costs and expenses		(2,491,698	)		(2,069,824	)		(1,584,950	)
Operating income	$	191,531			275,895			156,742

F-57

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Each of the above segments is comprised of homogeneous customers.

The information by geographical location (all within Mexico) including revenue, total assets, depreciation and additions of the telephone network, systems and equipment is as follows:

	Metropolitan			Central-
Services	Area			South			North			Total
Year ended December 31, 2008:
Local	$	1,558,015			726,438			20,488			2,304,941
Long distance		236,706			74,374			9,014			320,094
Rent of dedicated links		402			—			—			402
Sale of equipment to customers		8,740			1,873			77			10,690
Capacity leasing		47,102			—			—			47,102
Total revenue	$	1,850,965			802,685			29,579			2,683,229
Total assets as of December 31, 2008	$	9,578,452			1,298,685			308,373			11,185,510
Accumulated depreciation and amortization		(2,949,318	)		(232,333	)		(87,387	)		(3,269,038	)
Total assets	$	6,629,134			1,066,352			220,986			7,916,472
Acquisition of telephone network systems and equipment during 2008	$	1,339,919			269,019			22,063			1,631,001

F-58

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

	Metropolitan			Central-
Services	Area			South			North			Total
Year ended December 31, 2007:
Local	$	1,398,683			517,154			—			1,915,837
Long distance		171,308			175,234			10,375			356,917
Rent of dedicated links		180			119			—			299
Sale of equipment to customers		10,698			3,646			—			14,344
Capacity leasing		58,322			—			—			58,322
Total revenue	$	1,639,191			696,153			10,375			2,345,719
Total assets as of December 31, 2007	$	8,728,860			814,161			553,864			10,096,885
Accumulated depreciation and amortization		(1,735,440	)		(71,547	)		(275,798	)		(2,082,785	)
Total assets	$	6,993,420			742,614			278,066			8,014,100
Acquisition of telephone network systems and equipment during 2007	$	651,006			476,519			32,834			1,160,359

	Metropolitan			Central-
Services	Area			South			North			Total
Year ended December 31, 2006:
Local	$	934,524			385,265			—			1,319,789
Long distance		220,131			121,633			28,459			370,223
Rent of dedicated links		342			157			—			499
Sale of equipment to customers		6,062			8,360			—			14,422
Capacity leasing		36,759			—			—			36,759
Total revenue	$	1,197,818			515,415			28,459			1,741,692
Total assets as of December 31, 2006	$	5,867,306			325,527			386,778			6,579,611
Accumulated depreciation and amortization		(1,463,580	)		(50,039	)		(88	)		(1,513,707	)
Total assets	$	4,403,726			275,488			386,690			5,065,904
Acquisition of telephone network systems and equipment during 2006	$	987,954			141,454			710			1,130,118

F-59

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

NOTE 18 — COMPREHENSIVE FINANCIAL RESULTS:

As of December 2008, 2007 and 2006 the comprehensive financial results are analyzed as follows:

	2008			2007			2006
Comprehensive financial results:
Interest expense and commissions	$	(317,633	)		(285,858	)		(178,153	)
Interest income		53,994			55,793			8,591
Exchange gain income (loss) — Net		(261,787	)		4,826			(6,568	)
Effect of valuation of financial instruments		83,323			20,421			13,324
Gain on monetary position		—			42,586			33,753
	$	(442,103	)		(162,232	)		(129,053	)
Capitalized in telecommunications equipment and network (Note 7)	$	174,710			35,591			21,871
Total recorded in results of operations	$	(267,393	)		(126,641	)		(107,182	)

NOTE 19 — INCOME TAX (IT), ASSET TAX (AT), FLAT RATE BUSINESS TAX (IETU) AND EMPLOYEES’ STAUTORY PROFIT SHARING (ESPS):

On October 1, 2007, new laws were published, a number of tax laws were revised, and additionally a presidential decree was issued on November 5, 2007, all of which became effective on January 1, 2008. The most important changes are: (i) derogation of the Asset Tax Law and (ii) the introduction of a new tax (Flat Rate Business Tax or IETU) which is based on cash flows and limits certain deductions; additionally, certain tax credits are granted mainly with respect to inventories, salaries taxed for IT purposes and social security contributions, tax losses arising from accelerated deductions, recoverable asset tax, and deductions related to investments in fixed assets, deferred charges and expenses.

F-60

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Accordingly, beginning in 2008, companies will be required to pay the greater of IETU or IT. If IETU is payable, the payment is considered final and not subject to recovery in subsequent years. The IETU rate is 16.5% for 2008, 17% for 2009 and 17.5% for 2010 and thereafter.

Under the tax law in force through December 31, 2007, companies must pay the greater of IT or AT. Both taxes recognize the effects of inflation.

As of December 31, 2008, the Company and its Mexican subsidiaries are subject to IT and IETU individually, which means that they are not consolidated for tax payment calculations.

Because management estimates that the tax payable in future years will be Income Tax, deferred tax effects as of December 31, 2008 and 2007 have been recorded reflecting the IT basis.

Mexican Income Tax Law states that the statutory income tax rate is 28% since 2007 and thereafter.

Substantially all (loss) income before income tax (benefit) expense and related income tax (benefit) expense are from Mexican sources.

The following table shows the reconciliation between the effective tax rate and the statutory income tax rate:

	December 31,
	2008			2007			2006
(Loss) profit before income tax expense	$	(671,457	)		133,178			30,783
Statutory income tax rate		28	%		28	%		29	%
Income tax expense (benefit)		(188,008	)		37,290			8,927
Increase (decrease) on income tax expense resulting from:
Inflationary effects		(19,163	)		2,080			24,021

F-61

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

	December 31,
	2008			2007			2006
Non-deductible expenses		10,254			14,017			1,301
Change in valuation allowance		(34,498	)		39,272			—
Cancellation of allowance on asset tax for prior years(1)								31,679
Non-taxable income		(2,888	)		—			—
Others		609			4,323			(5,878	)
Income tax expense (benefit)		(233,694	)		96,982			60,050
Effective income tax rate		35	%		73	%		195	%

⁽¹⁾ As of December 31, 2005, the Company believed it had possibilities of recovering asset tax paid in prior years, based on the results of legal proceedings initiated and the fact that the prior Asset Tax Law allowed for deduction of liabilities in computing net assets. However, during the last quarter of 2006, the conditions of the legal process changed radically and together with the changes to the Asset Tax Law, effective as from January 1, 2007, which now precludes the inclusion of liabilities in determining the asset tax base, the Company concluded that there were not enough grounds to obtain a favorable resolution, and decided to record a valuation allowance in the total amount of said tax. Asset tax is incurred at the rate of 1.25% over the net amount of certain assets only when this tax exceeds income tax payable.

F-62

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

As of December 31, 2008 and 2007, the effect of deferred income tax and ESPS on the significant temporary differences is analyzed as follows:

	2008				2007
	IT		ESPS		IT			ESPS
Deferred assets:
Allowance for doubtful accounts	$	39,372		—		21,775			—
Labor obligations upon retirement		6,055		2,162		2,076			741
Derivative financial instruments		2,372		—		—			—
Provisions		37,691		13,461		9,656			3,449
Tax credit carryforwards		39,272		—		39,272			—
Tax loss carryforwards		411,277		—		267,420			—
Total gross deferred assets		536,039		15,623		340,199			4,190
Less valuation allowance		184,948		14,995		129,073			3,953
Deferred assets, net		351,091		628		211,126			237
Deferred liabilities:
Prepaid expenses		13,190		628		17,269			237
Telephone network system and equipment, frequency rights, intangible assets and preoperating expenses — Net		189,787		—		291,599			—
Total gross deferred liabilities		202,977		628		308,868			237
Net deferred assets (liabilities)	$	148,114		—		(97,742	)		—

As of December 31, 2007, the Company made a reclassification between gross deferred tax asset on tax loss carryforwards and its corresponding valuation allowance in the amount of $20,553. In addition, on January 1, 2008, a reclassification of a deferred tax liability on telephone network system and equipment and the valuation allowance for gross deferred tax assets was made in the amount of $90,373. These reclassifications do not have any affects in the 2007 and 2008 financial statements.

F-63

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Deferred income tax expense (benefit):

	2008			2007
Net change in deferred income tax asset (liability)	$	(245,856	)		9,046
Tax effect of deductible expenses related to the issuance of shares recorded net in the additional paid-in capital		—			37,236
Deferred income tax expense (benefit)	$	(245,856	)		46,282

The net change in the total valuation allowance for the year ended December 31, 2008, was a increase of $55,875. The valuation allowance as of December 31, 2008 was primarily related to net operating loss and tax credit carryforwards that, in the judgment of management, are not more likely than not to be realized. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the periods in which those temporary differences are deductible. Management considers the scheduled reversal of deferred tax liabilities, projected taxable income, and tax-planning strategies in making this assessment. In order to fully realize the deferred tax asset, the Company will need to generate future taxable income before the expiration of the deferred tax assets governed by the tax code. Based on the projections for future taxable income over the periods for which the deferred tax assets are deductible, management believes that it is more likely than not that the Company will realize the benefits of these deductible differences, net of the existing valuation allowances at December 31, 2008. The amount of the deferred tax asset considered realizable; however, could be reduced in the near term if estimates of future taxable income during the carryforward period are reduced.

F-64

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

As of December 31, 2008, the Company had accumulated tax loss carryforwards of $1,468,847, which will expire as follows:

Year of			Year of
loss	Amount		expiration
1999	$	18,109		2009
2000		102,156		2010
2001		32,292		2011
2002		282,004		2012
2003		35,388		2013
2004		79,533		2014
2005		132,644		2015
2006		74,058		2016
2007		269,142		2017
2008		443,521		2018
	$	1,468,847

As of December 31, 2008 the Company has recoverable AT amounting to $39,272, which will expire in 2018.

NOTE 20 — COMMITMENTS AND CONTINGENT LIABILITIES:

As of December 31, 2008, the Company had the following commitments:

a. Operating lease agreements:

The Company maintains operating leases on buildings, sites, poles and office equipment. The Company recorded leasing expenses of $73,380, $51,943 and $58,489 in 2008, 2007 and 2006, respectively.

The schedule for estimated future minimum lease payments is as follows:

2009	$	73,790
2010		69,590
2011		62,499
2012		58,754
2013 and thereafter:		61,146
	$	325,779

b. Lease agreement for the building currently housing the Company’s corporate offices.

F-65

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

On September 1, 2005, the Company renewed its corporate lease agreement with maturity date on December 31, 2012. The surface leased is 7,922 square meters. The Company recorded a lease expense of $31,163, $27,054 and $26,037 for the years ended December 31, 2008, 2007 and 2006, respectively.

The schedule of estimated future minimum lease payments is as follows:

2009	$	31,710
2010		30,910
2011		29,539
2012		22,329
2013 and thereafter:		5,636
	$	120,124

c. Finance lease agreements:

The Company has executed finance lease agreements with different entities regarding: telecommunications and transportation equipment. The terms of such agreements range from 18 to 36 months, with the option to purchase the leased good at reduced prices once the term is completed. The interest rate agreed in these agreements ranges from 6.9% to 10%, as per the specific conditions of each agreement.

The schedule of future minimum payments at December 31, 2008 is as follows:

2009	$	4,396
Total	$	4,396

d. Geographic expansion commitment:

The agreement amending the national concession agreement to install and operate a public telecommunications network in Mexico, entered into on December 2, 2004, sets forth a capacity installation program to handle a certain number of lines by the end of 2006, and sets forth a geographic expansion commitment up until 2014.

F-66

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

In order for the concession to remain in effect, the Company is required to comply with the capacity installation and geographic expansion commitment discussed above, among other conditions.

As of the date of issuance of the financial statements, said commitment was fully covered, with no future commitments remaining.

e. Commitment related to frequency rights:

As of December 31, 2008, the Company complied with its obligation to submit to the SCT the renewal of the surety bonds for the fiscal year 2008, as per the commitments and obligations set forth in the concessions.

f. Commitment pertaining to the sale of capacity:

In October 2003, the Company entered into an agreement for the sale of optical fiber capacity with another carrier in the amount of 2 million dollars, which was recognized at the time of the sale as an advanced collection to render this service; the term of this agreement is 13 years. As of December 31, 2008, deferred revenue amounted to 1.4 million dollars. The amortized revenue for 2008 and 2007 was $1,728 and $1,722, respectively.

In November 2007, the Company entered into an agreement for the sale of optical fiber capacity with GTM in the amount of 1.3 million dollars, which was recognized as an advanced collection to render this service; the term of this agreement is 5 years. As of December 31, 2008, deferred revenue amounted to 1.3 million dollars. The service and amortization of the revenue began in October 2008. The amortized revenue for 2008 was $680.

g. Lucent Technologies:

Telereunion is involved in a claim initiated by Lucent Technologies, Inc. for the collection of approximately 6.5 million dollars in connection with the installation of part of Telereunion’s fiber optic network. We believe that the likelihood of success of the Lucent claim is remote. Although Lucent has not initiated a formal legal proceeding against Telereunion and has only sent several letters in the attempt to collect the amount they allege is due, Telereunion initiated two legal proceedings in Mexican courts seeking (i) a declaration that the applicable statute of limitations (prescription) has expired and (ii) a declaration nullifying the document upon which Lucent bases its claim. In connection with the share purchase agreement related to the Grupo Telereunion acquisition, the Grupo VAC Investors agreed to indemnify us for any out of pocket costs we incur in connection with the resolution of the Lucent claim.

F-67

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

h. Comisión Federal de Electricidad:

Telereunion was a party to a lawsuit initiated by the Mexican Federal Power Commission for $38.7 million in rents due for the 30-year lease of infrastructure, entered into on June 23, 1999, that should have been paid in advance.

On January 9, 2007, Telereunion executed an agreement with the Mexican Federal Power Commission to pay the amount due over a two-year period in semi-annual payments beginning May 29, 2007 and ending November 29, 2008. As part of this agreement, Telereunion obtained a stand-by letter of credit issued to the Mexican Federal Power Commission to secure payment of the amount due. The Grupo VAC Investors have covered all of the expenses and costs associated with the issuance of this letter of credit. In 2006, the Grupo VAC Investors lent us $39.7 million which we have agreed to repay them over a 30-year period in monthly installments of no more than $110 per month, bearing an interest rate of “Tasa de interés interbancaria de equilibrio” (TIIE) plus 300 basis points. The resulting was paid to Comisión Federal de Electricidad by Telereunion on November 27, 2008.

The remaining amount to be paid regarding this matter is recorded under “Other accounts payable”. As of December 31, 2008 and 2007 it amounted to $33,924 and $35,094, respectively.

i. Claim brought by the Secretaría de Hacienda y Crédito Público as a result of a tax audit of Telereunion for the fiscal year 2004:

In January 2006 the tax authorities initiated audits of Telereunion on grounds of alleged omissions to pay the taxes corresponding to fiscal year 2004. These audits were concluded on September 6, 2007. On September 7, 2007 the tax authorities determined a tax obligation of Telereunion in the approximate amount of $59.4 million, due to the existence of certain differences and omissions in connection with tax returns of Telereunion.

As part of these audits, the authorities established that Telereunion was liable for a failure to pay Employees’ profit sharing in the approximate amount of $8.2 million to certain employees, in conformity with applicable laws. Pursuant to the obligations assumed by Grupo VAC under the Indemnity Agreement, since the Investors thereof agreed to indemnify Maxcom for any expenses incurred by it in that regard, no direct impact on the legal or financial condition or the operating results of Maxcom should occur. The Company has registered no liability, since in its opinion and its legal counsel is opinion, any charge against Telereunion is unlikely to occur.

F-68

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

NOTE 21 — SIGNIFICANT DIFFERENCES BETWEEN MEXICAN AND THE UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES:

The Company’s consolidated financial statements are prepared in accordance with Mexican Financial Reporting Standards (“MFRS” or “NIF”, for its initials in Spanish as described below), which differ in certain significant respects from accounting principles generally accepted in the United States of America (“U.S. GAAP”). Through December 31, 2007 the consolidated financial statements include the effects of inflation as provided for under Bulletin B-10 and its amendments (see note 5). The reconciliation for the years ended December 31, 2006 and 2007 does not include the reversal of other adjustments to the financial statements for the effects of inflation required under MFRS because the application of inflation accounting represented a comprehensive measure of the effects of price level changes in the inflationary Mexican economy and, as such, is considered a more meaningful presentation than nominal cost-based financial reporting for both Mexican and U.S. accounting purposes. As of January 1, 2008, the recognition of inflation is discontinued and the financial information is presented in adjusted nominal Mexican Pesos

Recently adopted accounting standards

In February 2007, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (“SFAS No. 159”). SFAS No. 159 permits companies, at their election, to measure specified financial instruments and warranty and insurance contracts at fair value on a contract-by-contract basis, with changes in fair value recognized in earnings each reporting period. The election, called the “fair value option,” will enable some companies to reduce the volatility in reported earnings caused by measuring related assets and liabilities differently, and it is easier than using the complex hedge-accounting requirements in SFAS No. 133, to achieve similar results. Subsequent changes in fair value for designated items will be required to be reported in earnings in the current period. SFAS No. 159 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and therefore became effective for the Company as of January 1, 2008. The Company has not elected to measure any eligible items at fair value. Accordingly, the adoption of SFAS No. 159 has not impacted the Company’s results of operations and financial position.

F-69

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS No. 157”), which defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS No. 157 does not require any new fair value measurements; rather, it applies under other accounting pronouncements that require or permit fair value measurements. The provisions of SFAS No. 157 are to be applied prospectively as of the beginning of the fiscal year in which it is initially applied; with certain limited exceptions with any transition adjustment recognized as a cumulative-effect adjustment generally to the opening balance of retained earnings.

SFAS No. 157 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under SFAS No. 157 are described below:

Level 1 — Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2 — Inputs that are observable, either directly or indirectly, but do not qualify as Level 1 inputs. (i.e., quoted prices for similar assets or liabilities)

Level 3 — Prices or valuation techniques that require inputs that are unobservable (i.e., supported by little or no market activity).

Fair value

The carrying value of the Company’s short-term instruments and derivates instruments and the related fair value level under SFAS 157 is summarized as follows:

			Quoted prices		Significant
			in active		other		Significant
	Balance at		markets for identical		observable		unobservable
	December 31,		assets		inputs		inputs
	2008		(Level 1)		(Level 2)		(Level 3)
Short-term investments(1)		1,500,270		11,702		1,488,568		—
Derivative Instruments, (net)		96,798		—		96,798
Total	$	1,597,068	$	11,702	$	1,585,366	$	—

⁽¹⁾ Short-term investments are classified in the balance sheet as cash and cash equivalents. The carrying value and fair value of cash and cash equivalents as of December 31, 2008 is $1,591,405, of which $1,500,270 represents the fair value of the short term investments.

F-70

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Short-term investments consists of Mexican governmental bonds which are measured using quoted prices in active markets and therefore classified as Level 1 in the fair value hierarchy. Short-term investments classified as Level 2 consist of money market mutual funds and commercial banking paper, whose fair values are obtained using observable inputs for their valuation.

Derivatives are valued using internal models that use as their basis readily observable market inputs, such as time value, forward interest rates, and current and forward market prices for foreign exchange rates. The Company generally classifies these instruments within Level 2 of the valuation hierarchy. Such derivatives include cross currency swaps and embedded derivatives which consist of forward contracts.

The provisions of SFAS No. 157 were adopted by the Company on January 1, 2008 and did not have any material effect on its overall financial position or results of operations.

F-71

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

In February 2008, the Financial Accounting Standards Board (FASB) approved FASB Staff Position (FSP) No. FAS 157-2, “Effective Date of FASB Statement No. 157” (FSP No. FAS 157-2), that permits companies to partially defer the effective date of SFAS No. 157 for one year for nonfinancial assets and nonfinancial liabilities that are recognized or disclosed at fair value in the financial statements on a nonrecurring basis. FSP No. FAS 157-2 does not permit companies to defer recognition and disclosure requirements for financial assets and financial liabilities or for nonfinancial assets and nonfinancial liabilities that are remeasured at least annually. In accordance with the provisions of FSP No. FAS 157-2, the Company has decided to defer the adoption of SFAS No. 157 for one year for nonfinancial assets and nonfinancial liabilities that are recognized or disclosed at fair value in the financial statements on a nonrecurring basis. The Company is currently evaluating the effect that this statement will have on its financial position and results of operations.

In October 2008, the FASB issued FASB Staff Position FAS 157-3, “Determining the Fair Value of a Financial Asset When the Market for That Asset is Not Active,” which was effective immediately. FSP FAS 157-3 clarifies the application of Statement 157 in cases where the market for a financial instrument is not active and provides an example to illustrate key considerations in determining fair value in these circumstances.

The principal differences between MFRS and U.S. GAAP are presented in the following pages with an explanation, where appropriate, of the effects on consolidated net loss and consolidated shareholders’ equity.

F-72

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

The following is a summary of the adjustments to consolidated net (loss) income and consolidated shareholders’ equity, respectively:

	Years Ended December 31,
	2008			2007			2006
Net (loss) income under MFRS	$	(437,763	)	$	36,196		$	(29,267	)
Adjustments:
Amortization of pre-operating expenses (a)		22,123			20,438			32,030
Capitalization of interest (b)		(112,738	)		(716	)		49,945
Amortization of capitalized interest (b)		(12,118	)		(11,896	)		(27,136	)
Installation revenues and related costs (c)		(2,824	)		(6,758	)		858
Installation costs not charged to customers (d)		(154,716	)		(60,640	)		(213,247	)
Debt restructuring (e)		—			—			197,006
Capitalized internal compensation cost (f)		143			143			143
Impairment charge (g)		532,315			—			—
Severance Indemnity liability (h)		2,405			(682	)		(908	)
Reversal of SAB 108 (j)		—			—			3,035
Recognition of deferred taxes (k)		(76,885	)		184,914			—
Total US GAAP adjustments		197,705			124,803			41,726
Net (loss) income under U.S. GAAP	$	(240,058	)	$	160,999		$	12,459
Basic and diluted earnings per share:
Numerator:
Net (loss) income under U.S. GAAP	$	(240,058	)	$	160,999		$	12,459
less: preferred stock dividend(1)		—			—			(539,738	)
Net (loss) income under U.S. GAAP available for common shareholders, used for basic computation		(240,058	)		160,999			(527,279	)
Net (loss) Income under U.S. GAAP available for common shareholders, used for dilutive computation		(240,058	)		160,999			(527,279	)
Denominator:
Weighted average of common shares used in basic computation (thousand)		789,819			560,176			247,853
Add: dilutive impact of stock options and warrants(2)		—			45,968			—
Weighted average of common shares used in dilutive computation (thousand)		789,819			606,144			247,853
Earnings per share, basic		(0.30	)		0.29			(2.13	)
Earnings per share, diluted		(0.30	)		0.27			(2.13	)

(1)	Earnings available to the common shareholders in 2006 were reduced for the fair value of a stock dividend paid to the preferred shareholders in the form of the Company’s common shares in the amount of $ 539.8 million. The weighted average number of shares for 2006 reflects the application of the “two-class method” specified by EITF 03-06.
(2)	According to FAS 128.

F-73

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

	As of December 31,
	2008			2007
Shareholders’ equity under MFRS	$	4,501,169		$	5,030,839
Accumulated adjustments:
Preoperating expenses (a)		(391,951	)		(391,951	)
Amortization of preoperating expenses (a)		336,172			314,049
Capitalization of interest (b)		8,440			121,178
Amortization of capitalized interest (b)		(64,465	)		(52,347	)
Installation revenues and related costs (c)		(76,805	)		(73,981	)
Installation costs not charged to customers (d)		(738,412	)		(583,696	)
Capitalized internal compensation cost (f)		(2,000	)		(2,143	)
Impairment charge (g)		532,315			—
Severance Indemnity liability (h)		(11,297	)		(1,590	)
SAB 108 initial effects (i)		7,034			7,034
SAB 108 effects for the year (j)		3,035			3,035
Recognition of deferred taxes (k)		111,420			184,914
Total U.S. GAAP adjustments	$	(286,514	)	$	(475,498	)
Shareholders’ equity under U.S. GAAP	$	4,214,655		$	4,555,341

Provided below is an analysis of changes in shareholders’ equity under U.S. GAAP:

	Year Ended
	December 31,
	2008			2007
Balance at the beginning of the year	$	4,555,341		$	1,676,612
Net (loss) income under U.S. GAAP		(240,058	)		160,999
(Decrease) increase in capital stock		(7	)		2,045,646
Increase in premium on issuance of shares		—			634,960
Stock option plan		(71,613	)		37,124
Repurchase of shares		(20,287	)		—
Severance Indemnity liability (FAS 158 effects), net of tax of $3,391		(8,721	)		—
Balance at the end of the year	$	4,214,655		$	4,555,341

I. Explanation of reconciling items

a. Preoperating expenses -

Under the Statement C-8 “Intangibles” in MFRS, all expenses incurred while a company or a project is in the preoperating or development stages were capitalized. The Company’s operations commenced in May 1999 and capitalized expenses are being amortized on a straight-line basis for a period not exceeding 10 years. The Company has not incurred any preoperating or development expenses since 2003.

Under US GAAP, such pre-operating expenses are expensed as incurred.

F-74

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

b. Capitalization of interest -

In accordance with MFRS, the Company capitalizes comprehensive cost of financing (which is comprised of interest expense, foreign exchange gains or losses and monetary gain) incurred during the period of construction and installation of an asset. Further, cost capitalized is limited to the specific financing obtained for the construction of the related asset. The Company is amortizing capitalized interests on a straight-line basis over 10 years.

As of 2008, the Mexican economy is no longer deemed an inflationary environment, for purposes of Mexican GAAP; therefore capitalization of the comprehensive financing result in such year no longer consider any gains or losses from monetary position as result of the adoption of the new MFRS B-10 “Inflation Effects” mentioned elsewhere in this financial statement. As a result, the Company capitalized $112,738 of foreign exchange differences that must be reversed for purposes of U.S. GAAP.

Under U.S. GAAP, capitalization of interest is required for certain qualifying assets that require a period of time to get them ready for their intended use. The amount of interest to be capitalized is that portion of the interest cost incurred during the asset acquisition period that theoretically could have been avoided if expenditures for the assets had not been made, and is not limited to indebtedness directly attributable to the assets. US GAAP does not allow the capitalization of foreign exchange rate differences.

c. Installation revenues and related costs -

Under MFRS, installation revenues and related costs are recognized immediately, when installations are charged to customers.

Under U.S. GAAP, installation revenues and related costs are deferred and amortized over the expected customer relationship period when installation is charged to the customers,to the extent that costs do not exceed revenues, otherwise excess costs are expensed as incurred. The Company estimated its customer relationship period to be 4 years.

d. Installation costs not charged to customers-

Under MFRS, installation costs not charged to customers are capitalized and amortized on a straight-line basis over the remaining term of the concession. The concession term expires in October 2017.

Under U.S. GAAP, installation costs not charged to customers are expensed as incurred.

F-75

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

e. Debt restructuring -

Under MFRS, the difference between the old carrying value and new carrying value of the debt is taken directly to equity at the time of the restructuring and recorded as capital stock and additional paid-in capital. Debt issuance costs and the debt discount recorded due to the issuance of warrants are amortized over the original term of the corresponding debt with which it was originally issued with no adjustment at the time of restructuring.

Under U.S. GAAP, the April 2002, July 2002 and October 2004 debt restructurings qualify as troubled debt restructurings pursuant to the provisions of Statement of Financial Accounting Standards No. 15, Accounting by Debtors and Creditors for Troubled Debt Restructurings (“FAS 15”).

The 2002 debt restructurings are accounted for as a combination of types, as stock, warrants, and Old Senior Notes were exchanged for the 13³/4% Notes. A gain was recognized in 2002, as the adjusted carrying value of the 13³/4% Notes (including unamortized debt issuance costs and warrant discount) was greater than total future cash payments of the Old Senior Notes at the dates of the 2002 restructurings. To calculate the gain on the 2002 restructurings, the carrying value of the 13³/4% Notes was reduced by the fair value of the equity interest granted as well as by all legal and other costs in relation to the restructurings, to determine the adjusted carrying value, which was compared to the gross future cash payments of the Old Senior Notes to determine the gain.

For the purposes of applying the provisions of FAS 15 to the October 2004 restructuring, the exchanges of the primary and other holders were recorded as follows:

(a)

The exchange with the primary holder is accounted for as a combination of types as the primary holder received both New Senior Notes and stock in exchange for the Old Senior Notes exchanged. A gain was recorded, as the adjusted carrying value of the Old Senior Notes exchanged was greater than the total future cash payments of the New Senior Notes at the time of the exchange. To calculate the gain on the restructuring, the carrying value of the Old Senior Notes was reduced by the fair value of the equity interest granted as well as all legal and other costs in relation to the restructuring, to determine the adjusted carrying value, which was compared to the gross future cash payments under the terms of the New Senior Notes to determine the gain.

(b)

The other holders exchanged Old Senior Notes for New Senior Notes, which is accounted for as a modification of terms under FAS 15 due to the extension of the maturity date and the increase in total interest payments. Since the carrying amount of the Old Senior Notes on October 2004 did not exceed the total future cash payments of the New Senior Notes, no gain on the exchange with the other holders was recognized.

Interest expense on the New Senior Notes provided to other holders is determined using an effective interest rate that equates the present value of the future cash payments specified by the New Senior Notes, with the carrying amount of the Old Senior Notes.

F-76

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

In December 2006 and April 2007, the Company redeemed its outstanding debt related to its Old Senior Notes and its New Senior Notes (see Note 11). Under MFRS, in accordance to the Statement C-9 “Liabilities, Accruals, Contingent Assets and Liabilities and Commitments” of NIF, the Company’s management determined that the issuance of bonds in December 2006, represented new debt in accordance with the provisions specified in such Statement, thus any remaining balances for debt issuance costs in prior years, were taken to income. Under U.S. GAAP, the remaining outstanding balance of the debt restructuring was recognized in the income results.

f. Capitalized internal compensation cost -

MFRS allows that certain compensation charges directly attributable to capital expenditures to be capitalized. During 2002, the Company capitalized some compensation expenses in an amount of $2,856, which are being amortized on a straight-line basis over 20 years. The Company has not incurred these charges since 2003.

Under U.S. GAAP, these charges were expensed when incurred.

g. Impairment -

As of December 31, 2008, under MFRS, the carrying amount of long-lived assets was higher than the expected discounted income at the Company’s theoretical rate for weighted average cost of capital under current market conditions. The impairment charge (a non-cash item) calculated for 2008 amounted to $532,315. Said charge was proportionately distributed throughout the different asset classes.

Under US GAAP, an impairment test on long-lived assets requires a two-step process to determine the amount of any impairment loss to be recognized. The first step of this test requires the determination of whether the carrying amount of the long-lived asset is recoverable through the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. The second step requires the determination of the amount of impairment loss to be recognized by comparing the carrying amount of the asset to its fair value. MFRS does not require a two-step impairment evaluation process for long-lived assets but rather, a direct comparison of fair value to carrying value. Under U.S. GAAP, no impairment was recognized as the carrying amount was considered to be recoverable, therefore, the impairment recognized for MFRS purposes was reversed for US GAAP purposes.

F-77

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

h. Severance Indemnity liability -

MFRS requires the recognition of a severance indemnity liability calculated based on actuarial computations. Similar recognition criteria under U.S. GAAP are established in SFAS No. 112, “Employers’ Accounting for Postemployment Benefits”.

Due to the revision of NIF D-3 “Employee benefits”, effective January 1, 2008, companies must now amortize transition obligations/benefits, unrecognized prior service costs/benefits and net gains and losses over a maximum period of 5 years.

In 2008 the Company adopted the NIF D-3 “Employee benefits” which provides for the elimination of any related intangible asset previously recorded

	2007
Labor obligation at retirement asset as of December 31, 2006	$	15,068
Labor obligation at retirement asset as of December 31, 2007		17,650
Amortization of past service cost		2,582
Amortization of variances in assumptions		(992	)
Cost reduction under US GAAP*	$	1,590

* As mentioned previously, for Mexican FRS purposes the Company eliminated the related intangible asset. This effect was reversed for US GAAP purposes, resulting in a Ps. 1,590 increase in net income.

Effective December 31, 2008, the Company adopted the recognition and disclosure provisions of FASB Statement No. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans (SFAS 158). SFAS 158 requires companies to recognize the funded status of defined benefit pension and other postretirement plans as a net asset or liability and to recognize changes in that funded status in the year in which the changes occur through other comprehensive income to the extent those changes are not included in the net periodic cost. The funded status reported on the balance sheet as of December 31, 2008 under SFAS 158 was measured as the difference between the fair value of plan assets and the benefit obligation on a plan-by-plan basis. The Company believes that the assumptions utilized in recording its obligations under its plans are reasonable based on its experience and market conditions.

The accumulated effect of this standard on the Company as of December 31, 2008 is shown as follows:

Accumulated Other Comprehensive Income (AOCI) roll-forward and Comprehensive Income:

	OCI			AOCI
AOCI beginning balance at January 1, 2008
Net loss	$	(240,058	)
SFAS 158 effect of the year (net of deferred income tax effect of $3,391)		(8,722	)
Other comprehensive income		(8,722	)	$	(8,722	)
Comprehensive income	$	(248,780	)
AOCI ending balance at December 31, 2008				$	(8,722	)

i. Initial application of SAB 108 -

In September 2006, the SEC staff issued Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements”. SAB 108 was issued in order to eliminate the diversity of practice surrounding how public companies quantify financial statement misstatements.

F-78

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Traditionally, there have been two widely-recognized methods for quantifying the effects of financial statement misstatements: the “roll-over” method and the “iron curtain” method. The roll-over method focuses primarily on the impact of a misstatement on the income statement-including the reversing effect of prior year misstatements- but its use can lead to the accumulation of misstatements in the balance sheet. The iron-curtain method, on the other hand, focuses primarily on the effect of correcting the period-end balance sheet with less emphasis on the reversing effects of prior year errors on the income statement. Prior to our application of the guidance in SAB 108, we used the roll-over method for quantifying financial statement misstatements.

In SAB 108, the SEC staff established an approach that requires quantification of financial statement misstatements based on the effects of the misstatements on each of the Company’s financial statements and the related financial statement disclosures. This model is commonly referred to as a “dual approach” because it requires quantification of errors under both the iron curtain and the roll-over methods.

SAB 108 permits existing public companies to initially apply its provisions either by (i) restating prior financial statements as if the “dual approach” had always been applied or (ii) recording the cumulative effect of initially applying the “dual approach” as adjustments to the carrying values of assets and liabilities as of January 1, 2006 with an offsetting adjustment recorded to the opening balance of retained earnings. We elected to record the effects of applying SAB 108 using the cumulative effect transition method.

In connection with the preparation of its Annual Report for the year ended December 31, 2006, Maxcom detected prior year misstatements, not identified during prior years. In order to evaluate whether such errors resulted in a material misstatement to the previously issued financial statements, management quantified the aggregate misstatement to the prior years financial statements using its pre-SAB 108 quantification method (the roll-over method). This analysis included all misstatements relating to the prior years financial statements including the misstatements that were “corrected” through the cumulative effect adjustment (recorded as of January 1, 2006) relating to the initial application of SAB 108.

Based on their consideration of the total misstatement of the prior years financial statements (using the roll-over method), management determined that the prior years financial statements were not materially misstated.

F-79

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

The following table summarizes the effects (up to January 1, 2006) of applying the guidance in SAB 108 (in thousands):

	Period in which the			Period in which the			Period in which the
	Misstatement			Misstatement			Misstatement
	Originated (1)			Originated (1)			Originated (1)			Adjustment recorded
	Year Ended			Year Ended			Year Ended			as of
	December 31, 2003			December 31, 2004			December 31, 2005			January 1, 2006
Labor liabilities (2)	$	(15,977	)	$	—		$	(647	)	$	(16,624	)
Capitalized interest (3)		(4,576	)		(1,310	)		613			(5,273	)
Increasing-debt rate (4)		—			(3,682	)		(8,321	)		(12,003	)
Stock-option plan (5)		—			(603	)		(2,890	)		(3,493	)
Embedded derivatives (6)		—			—			7,292			7,292
Debt restructuring (7)		—			137,597			6			137,603
Installation costs not charged (7)		—			(111,511	)		1,593			(109,918	)
Installation revenues and costs (8)		—			—			11,593			11,593
Other (9)		11,346			(9,534	)		(3,955	)		(2,143	)
Deferred income taxes (10)		—			—			—			—
Impact on net income(11)	$	(9,207	)	$	10,957		$	5,284
Retained earnings(12)										$	7,034

(1)	We previously quantified these errors under the roll-over method and concluded that they were immaterial, individually and in the aggregate.
(2)	We were not recognizing this difference for severance indemnity as required by U.S. generally accepted accounting principles (see reconciling item h.). As a result of this error, our severance indemnity expense was understated by $16.0 million in 2003 and by $0.6 million in 2005, no expense recognition is applicable for 2004. We recorded a $16.6 million increase in our liability for severance indemnity as of January 1, 2006 with a corresponding reduction in retained earnings to correct these misstatements.
(3)	We incorrectly amortized capitalized interest expenses in 2005 and prior years. As a result of this error, our expenses were understated in 2003 by $4.6 million, in 2004 by $1.3 and overstated by $0.6 million in 2005. We recorded a $5.3 million decrease in our capitalized interest as of January 1, 2006 with a corresponding reduction in retained earnings to correct these misstatements.
(4)	We were not adjusting our expenses for increasing-debt rate as required by U.S. generally accepted accounting principles to the interest method. As a result of this error, our interest expense was understated by $3.7 million in 2004 and by $8.3 million in 2005. We recorded a $12.0 million increase in our liability for interest payable as of January 1, 2006 with a corresponding reduction in retained earnings to correct these misstatements (see item j. below for reversal in 2006).
(5)	We were not recognizing compensation cost expense as required by U.S. generally accepted accounting principles. As a result of this error, our compensation expense was understated by $0.6 million in 2004 and by $2.9 million in 2005. We recorded a $3.5 million increase in our additional-paid in capital for stock-option plans as of January 1, 2006 with a corresponding reduction in retained earnings to correct these misstatements.

F-80

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

(6)	We were not recognizing the effect in income generated by embedded derivatives as required by U.S. generally accepted accounting principles. As a result of this error in both GAAPs in 2005, our income was understated by $7.3 million. We recorded a $7.3 million increase in our assets as of January 1, 2006 with a corresponding increase in retained earnings to correct these misstatements. This balance does not represent a difference between GAAPs, however for MFRS purposes this effect was immaterial for being adjusted (see item j. below for reversal in 2006).
(7)	We were incorrectly presenting the accumulated amortization related to debt restructuring and installation costs not charged to customers. As a result of both reclassification errors, our income was understated by $26.1 million in 2004 and by $1.6 million in 2005 (amounts presented net). We recorded a $27.7 million increase in our assets as of January 1, 2006 with a corresponding increment in retained earnings to correct these misstatements.
(8)	We were incorrectly recognizing the effect in income generated by the amortization installation revenues and costs. As a result of this error, our income was understated by $11.6 million in 2005. We recorded a $11.6 million increase in our assets as of January 1, 2006 with a corresponding increment in retained earnings to correct these misstatements.
(9)	We incorrectly recorded minor entries representing preoperating expenses, leasehold improvements and revenue recognition. As a result of these errors, our expense was overstated by $11.3 million in 2003 and understated by $9.5 million in 2004 and $4.0 million in 2005. We recorded a $2.2 million increase in the Company’s liabilities for these concepts as of January 1, 2006 with a corresponding reduction in retained earnings to correct these misstatements.
(10)	No deferred taxes were calculated in the application of the SAB 108 as those balances would represent a deferred tax asset for the net balance to be adjusted on January 1, 2006, that is not deemed recoverable and should be fully reserved for accounting purposes.
(11)	Represents the net over-statement of net income for the indicated periods resulting from these misstatements
(12)	Represents the net reduction to retained earnings recorded as of January 1, 2006 to record the initial application of SAB 108.

j. Reversal of SAB 108 -

Below are disclosed entries adjusted for SAB 108 and their effect on the fiscal year:

	December 31, 2006
Preoperating expenses	$	(1,676	)
Increasing debt rate (1)		12,003
Embedded derivatives (2)		(7,292	)
	$	3,035

(1)	These notes were called in advance during 2006 and thus, outstanding payable balances under U.S. GAAP were eliminated.
(2)	In 2006, the Company started recognizing embedded derivatives in their local books, therefore, this reconciling item is reversed.

F-81

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

k. Recognition of Deferred taxes -

This amount represents the effect in deferred income taxes over the adjustments between MFRS and U.S. GAAP when applicable.

II. Disclosures

a. Restrictive Covenants -

The terms of the old notes and the new notes, impose significant operating and financial restrictions to the Company. These restrictions affect, and in many respects significantly limit or prohibit, its ability to, among other things:

• borrow money;

• pay dividends on our capital stock;

• purchase stock or repay subordinated indebtedness;

• sell assets; and

• consolidate or merge into other companies.

If we do not comply with these restrictions, we could be in default even if we are able to service our debt. If there were a default, holders of the notes could demand immediate payment of the aggregate principal amount and accrued interest on the notes outstanding. This could lead to our bankruptcy or reorganization for the benefit of our creditors or to our inability to pay our obligations.

b. Proforma earnings per share -

Pursuant to guidelines established in FAS 154 “Accounting Changes and Error Corrections a replacement of APB Opinion No. 20 and FASB Statement No. 3”, the Company notes that it changed the estimate of useful lives of telephone network systems and equipment during 2007. As explained in Note 5d the Company recalculated the amount of depreciation expense related to these assets for the year 2007, which amounted to $33,231. If depreciation would have been estimated based on the previous remaining useful lives, the depreciation expense for the year 2007 would have been of $16,011, the effects of these changes during 2007 was a reduction of $0.03 per share, under both MFRS and U.S. GAAP.

F-82

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

c. Acquisition of Sierra Comunicaciones

In 2007, under MFRS the acquisition of Sierra Comunicaciones was recognized in the books of the Company following the applicable guidance for business combinations, however for US GAAP purposes based on the characteristics of the transaction, the Company applied EITF (Emerging Issues Task Force) 98-3 “Determining Whether a Nonmonetary Transaction Involves Receipt of Productive Assets or of a Business” and considered the transaction to be an acquisition of a group of assets as the entity acquired was not regarded as a self-sustaining integrated set of activities and assets. This acquisition did not represent a GAAP difference as no goodwill was recognized under MFRS and excess of the purchase price over book value was allocated to the assets received.

d. Fair value

The carrying amount of cash, trade accounts receivable, other accounts receivable, trade accounts payable, other accounts payable and accrued expenses and short-term debt, approximates fair value because of the short-term maturity of these financial assets and liabilities.

At December 31, 2008 and 2007, the fair value of the Company’s long-term debt based on available market prices and estimates using market data information and appropriate valuation methodologies for the same or similar instruments are summarized as follows:

			Quoted prices		Significant
	Fair value at		in active		other		Significant
	December 31,		markets for		observable		unobservable
	2008		identical assets		inputs		inputs
			(Level 1)		(Level 2)		(Level 3)
Senior Notes(1)	$	2,044,283		—		2,044,283		—

⁽¹⁾ Senior notes are carried at amortized cost and their carrying value as of December 31, 2008 is $2,707,660. The $2,044,283 represents the estimated fair value of the notes. See Note 11 “Bonds Payable”.

e. Deferred income taxes -

For MFRS purposes, the Company applies NIF D-4 “Taxes on income”, which supersedes Bulletin D-4 “Accounting for income and asset taxes and employee statutory profit sharing” and Bulletins 53 and 54. The principal considerations established by this NIF are: (i) the balance of the cumulative IT effects resulting from the initial adoption of Bulletin D-4 in 2000 is reclassified to retained earnings, unless identified with any other comprehensive item pending reclassification; (ii) the accounting treatment of ESPS (current and deferred) is transferred to NIF D-3. For purposes of the reconciliation to U.S. GAAP, the Company has applied Statement of Financial Accounting Standards No. 109 “Accounting for Income Taxes” (FAS 109), for all periods presented.

FAS 109 requires an asset and liability method of accounting, whereby, deferred taxes are recognized for the future tax consequences of all temporary differences between the financial statement carrying amounts and the related tax bases of assets and liabilities. Under U.S. GAAP, the effect on deferred taxes of changes in tax rates is recognized in the income statement in the period in which the tax rates are enacted.

FAS 109 requires deferred tax assets to be reduced by a valuation allowance if, based on the weight of available evidence, including cumulative losses in recent years, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Accordingly, for 2006, the Company established a valuation allowance for the amount of the deferred tax assets that the Company estimated will not result in a future tax benefit.

F-83

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based upon the level of projections for future taxable income over the periods which the deferred tax assets are deductible, management believes it is more likely than not the company will realize the benefits of these deductible differences, net of the existing valuation allowance as of December 31, 2008 and 2007. The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carry forward period are reduced.

In July 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes, an interpretation of Statement of Financial Accounting Standards No.109” (FIN 48). On January 1, 2007, the Company adopted FIN 48, which clarifies the accounting for uncertain tax positions. This interpretation requires that an entity recognizes in the consolidated financial statements the impact of a tax position, if that position is more likely than not of being sustained upon examination, based on the technical merits of the position. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The adoption of FIN 48 on January 1, 2007 did not have any effect on the Company’s consolidated financial statements. The Company’s accounting policy is to accrue interest and penalties related to unrecognized tax benefits, if and when required, as selling, general and administrative expenses in the consolidated statements of operations.

As of January 1, 2007 and for the years ended December 31, 2008 and 2007, the Company did not have any unrecognized tax benefits and thus no interest and penalties related to unrecognized tax benefits were recorded. In addition, the Company does not expect that the amount of unrecognized tax benefits will change significantly within the next 12 months. The income tax returns of the Company and its subsidiaries remain subject to examination by the local tax authorities for the tax years beginning in 2002 in Mexico and 2005 in U.S.

F-84

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

F-85

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

Significant components of deferred income taxes under U.S. GAAP are as follows:

	SFAS 109			SFAS 109
	Applied to			Applied to
	MFRS			U.S. GAAP
December 31, 2008:	Balances			Balances			Total
Deferred tax assets
Allowance for doubtful accounts	$	39,372			—		$	39,372
Labor obligations upon retirement		6,055			(1,970	)		4,085
Derivative financial instruments		2,372			—			2,372
Provisions		37,691			—			37,691
Installation revenues		—			21,505			21,505
Installation costs not charged to customers		—			206,755			206,755
Tax credit carryforwards		39,272			—			39,272
Tax loss carryforwards		411,277			—			411,277
Total gross deferred tax assets		536,039			226,290			762,329
Less valuation allowance		(184,948	)		—			(184,948	)
Net deferred tax assets	$	351,091			226,290			577,381
Deferred tax liabilities
Telephone network equipment and leasehold improvements, frequency rights, intangible assets, impairment and preoperating expenses	$	(189,787	)		(114,870	)		(304,657	)
Prepaid expenses		(13,190	)		—			(13,190	)
Total gross deferred tax liabilities		(202,977	)		(114,870	)		(317,847	)
Net deferred tax asset	$	148,114			111,420			259,534

	SFAS 109			SFAS 109
	Applied to			Applied to
	MFRS			U.S. GAAP
	Balances			Balances		Total
December 31, 2007:
Deferred tax assets:
Bad debt allowance	$	21,775			—	$	21,775
Tax loss carry forwards		267,420			—		267,420
Accruals		51,004			—		51,004
Installation revenues		—			20,715		20,715
Installation costs not charged to customers		—			163,435		163,435
Total gross deferred tax assets		340,199			184,150		524,349
Valuation allowance		(129,073	)		—		(129,073	)
Net deferred tax assets		211,126			184,150		395,276
Deferred tax liabilities:
Prepaid expenses		(17,269	)		—		(17,269	)
Telephone network equipment and leasehold improvements, frequency rights, intangible assets and preoperating expenses		(291,599	)		764		(290,835	)
Total gross deferred tax liabilities		(308,868	)		764		(308,104	)
Net deferred tax (liability) asset	$	(97,742	)	$	184,914	$	87,172

F-86

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

f. Cash flow information -

The statements of changes in financial position were presented for the years ended December 31, 2007 and 2006, as mentioned in Note 5.

Under U.S. GAAP, a statement of cash flows is a required component of a complete set of financial statements, which presents cash transactions, and additional information about non-cash investing and financing activities shall be disclosed.

On January 1, 2008, MFRS B-2 became effective; therefore, management included the statement of cash flows for the year ended December 31, 2008 as part of the basic financial statements with prospective application.

The statement of cash flows prepared in accordance with MFRS for the year ending December 31, 2008 presents substantially the same information as that required under US GAAP as interpreted by SFAS No. 95, except for certain differences in presentation.

The following price-level adjusted consolidated statement of cash flows presented for the years ended December 31, 2007 and 2006, includes the effect of inflation in conformity with recommendations established by the American Institute of Certified Public Accountants SEC Regulations Committees’ International Practices Task Force.

F-87

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

	Year Ended December 31,
	2008			2007			2006
Operating activities:
Net (loss) income under U.S. GAAP	$	(240,058	)	$	160,999		$	12,459
Adjustments to reconcile net income (loss) to net cash flow provided by operating activities:
Depreciation and amortization		476,813			328,269			167,721
Hedging valuation		(83,323	)		(24,036	)		(5,217	)
Allowance for doubtful accounts		39,956			5,318			36,556
Monetary gain		—			(15,533	)		(21,503	)
Deferred income tax		(168,971	)		(138,632	)		60,051
Severance indemnity		14,669			6,434			4,642
Stock option plan		5,114			37,124			15,982
Loss on sale of fixed assets		82,496			6,166			1,369
Other					67,255			(1,000	)
Foreign currency exchange gain (loss)		534,420			(47,957	)		(90,781	)
		661,116			385,407			180,279
Changes in operating assets and liabilities:
Accounts receivable		(227,744	)		(319,003	)		(321,562	)
Inventory		(7,627	)		2,540			(19,160	)
Prepaid expenses		9,563			2,091			14,271
Other assets and liabilities		3,353			93,404			25,267
Cash flow provided by (used in) operating activities		438,861			164,439			(120,905	)
Investing activities:
Acquisition of fixed assets		(1,298,619	)		(1,126,022	)		(772,773	)
Proceeds on sale of fixed assets		4,364			(6,371	)		4,428
Purchase of Telereunion, net of cash acquired		—			—			(101,173	)
Purchase of Sierra, net of cash acquired		—			(33,576	)		—
Acquisition of intangible assets		12,704			(79,112	)		(35,370	)
Cash flow used in investing activities		(1,281,551	)		(1,245,081	)		(904,888	)
Financing activities:
Restricted cash		—			23,462			(15,179	)
Capital (decrease) increase — Net of equity issuance cost		(7	)		2,643,369			357,348
Cost of shares acquired for issuance upon exercise of stock options, and issuance costs		(76,727	)
Bank financing and debt payments		(8,419	)		131,432			(460,666	)
Repurchase of shares		(20,287	)		—			—
Senior notes issued — Net of debt issuance cost		—			118,214			1,650,241
Cash flow (used in) provided by financing activities		(105,440	)		2,916,477			1,531,744
Effect of exchange rate changes on cash and cash equivalents		—			(35,591	)		(7,878	)
Net increase in cash and cash equivalents		(948,130	)		1,800,244			498,073
Cash and cash equivalents at beginning of the year		2,539,535			739,291			241,218
Cash and cash equivalents at end of the year		1,591,405			2,539,535			739,291
Interest paid	$	276,434		$	271,973		$	139,716
Income taxes paid	$	7,320		$	25,530		$	1,396
Supplemental disclosures about non-cash activities Optical fiber and links reclassification		—			—			144,241
(Decrease) increase on fixed assets acquired Under capital lease		4,740			(50,791	)		15,620

F-88

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

g. Operating income -

MFRS allows certain non-recurring charges, such as asset write-offs, to be classified as non-operating. For the years ended 2008, 2007 and 2006, these charges were $12,616, $12,819, and $18,777, respectively.
Under U.S. GAAP, such items are considered part of operating income.

h. New U.S. GAAP accounting pronouncements -

In December 2007, the FASB issued FASB Statement No. 141(R), Business Combinations, and FASB Statement No. 160, Noncontrolling Interests in Consolidated Financial Statements — an amendment to ARB No. 51. Statements 141(R) and 160 require most identifiable assets, liabilities, noncontrolling interests, and goodwill acquired in a business combination to be recorded at “full fair value” and require noncontrolling interests (previously referred to as minority interests) to be reported as a component of equity, which changes the accounting for transactions with noncontrolling interest holders. Both Statements are effective for periods beginning on or after December 15, 2008, and earlier adoption is prohibited. Statement 141(R) will be applied to business combinations occurring after the effective date. Statement 160 will be applied prospectively to all noncontrolling interests, including any that arose before the effective date. All of the Company’s subsidiaries are wholly owned, so the adoption of Statement 160 is not expected to impact its financial position and results of operations. The Company is currently evaluating the impact of adopting Statement 141(R) on its financial position and results of operations.

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities, an amendment of FASB Statement No. 133 (“SFAS No. 161”). SFAS No. 161 requires enhanced disclosures about an entity’s derivative and hedging activities. Under SFAS No. 161, entities are required to provide enhanced disclosures about (a) how and why an entity uses derivative instruments; (b) how derivative instruments and related hedged items are accounted for under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities and its related interpretations; and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS No. 161 is effective beginning January 1, 2009 (the first day of fiscal 2009). SFAS No. 161 encourages comparative disclosures for earlier periods at initial adoption. The Company is currently analyzing the effect that this statement will have on its financial position and results of operations.

F-89

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

In April 2008, the FASB issued FSP FASB Statement (“FSP FAS”) No. 142-3, Determination of the Useful Life of Intangible Assets (“FSP FAS No. 142-3”). FSP FAS No. 142-3 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under SFAS No. 142, Goodwill and Other Intangible Assets. FSP FAS No. 142-3 also requires expanded disclosure related to the determination of intangible asset useful lives, effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. The Company does not expect any material impact on its financial position and results of operations with the adoption of this statement.

In May 2008, the Financial Accounting Standards Board (“FASB”) issued FASB Staff Position (“FSP”) No. APB 14-1, Accounting for Convertible Debt Instruments That May Be Settled In Cash Upon Conversion (Including Partial Cash Settlement) (“FSP APB 14-1”). FSP APB 14-1 changes the accounting treatment for convertible debt instruments that require or permit partial cash settlement upon conversion. The accounting changes require issuers to separate convertible debt instruments into two components: a non-convertible bond and a conversion option. The separation of the conversion option creates an original issue discount in the bond component which is to be amortized as interest expense over the term of the instrument using the interest method, resulting in an increase to interest expense and a decrease in net income and earnings per share. The Company does not expect any material impact on its financial position and results of operations with the adoption of this statement.

In May 2008, the FASB issued SFAS No. 162, The Hierarchy of Generally Accepted Accounting Principles (“SFAS No. 162”). SFAS No. 162 identifies the sources of accounting principles and the framework for selecting the accounting principles used in the preparation of financial statements of nongovernmental entities that are presented in conformity with U.S. GAAP. This statement will be effective 60 days following the SEC’s approval of the Public Accounting Oversight Board amendments to AU Section 411, The Meaning of Present Fairly in Conformity with GAAP. The Company does not expect any material impact on its financial position and results of operations with the adoption of this statement.

In December 2008, the FASB issued FSP FAS No. 132 (R)-1, Employers’ Disclosures about Postretirement Benefit Plan Assets (FSP 132 (R)-1). FSP 132 (R)-1 requires plan sponsors, to provide improved disclosures about plan assets, including categories of plan assets, nature and amount of concentrations of risk and disclosure about fair value measurements of plan assets, similar to those required by SFAS No. 157, Fair Value Measurements.. The disclosures about plan assets required by this FSP shall be provided for fiscal years ending after December 15, 2009.

F-90

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

In May 2009 the FASB issued SFAS No. 165, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. SFAS 165 sets forth the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements and the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. SFAS 165 becomes effective to interim or annual financial periods ending after June 15, 2009. We do not expect any material impact from adoption of SFAS 165 on our consolidated financial position or results of operations since we already evaluate events or transactions that may affect recognition or disclosure in the financial statements.

In June 2009, the FASB issued SFAS No. 166, “Accounting for Transfers of Financial Assets — an amendment of Statement No. 140”, which improves the relevance, representational faithfulness and comparability of the information that a reporting entity provides in its financial statements about a transfer of financial assets; the effects of a transfer on its financial position, financial performance and cash flows; and a transferor’s continuing involvement, if any, in transferred financial assets. This Statement must be applied as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period and for interim and annual reporting periods thereafter. Earlier application is prohibited. This Statement must be applied to transfers occurring on or after the effective date. We are currently evaluating the impact of adoption of SFAS 166 on our consolidated financial position or results of operations.

In June 2009, the FASB issued SFAS No. 167, “Amendments to FASB Interpretation No. 46(R)”, which improves financial reporting by enterprises involved with variable interest entities. The Board developed this pronouncement to address (1) the effects on certain provisions of FASB Interpretation No. 46 (revised December 2003), “Consolidation of Variable Interest Entities”, as a result of the elimination of the qualifying special-purpose entity concept in FASB Statement No. 166, “Accounting for Transfers of Financial Assets”, and (2) constituent concerns about the application of certain key provisions of Interpretation 46(R), including those in which the accounting and disclosures under the Interpretation do not always provide timely and useful information about an enterprise’s involvement in a variable interest entity. This Statement shall be effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. Earlier application is prohibited. We are currently evaluating the impact of adoption of SFAS 167 on our consolidated financial position or results of operations.

F-91

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

i. Subsidiary Guarantor Information

On December 20, 2006, the Company issued 150 million dollars of Senior Notes in an international offering of debt that was subsequently completed on January 10, 2007 and on September 5, 2007, with the additional issuance of 25.0 million dollars each. The Senior Notes were registered as public debt in a exchange offer on December 28, 2007, pursuant to a guarantee by certain Maxcom subsidiaries: Corporativo en Telecomunicaciones, S. A. de C. V., Maxcom Servicios Administrativos, S. A. de C. V., Outsourcing Operadora de Personal, S. A. de C. V., TECBTC Estrategias de Promoción, S. A. de C. V., Maxcom TV, S. A. de C. V., Maxcom, USA, Inc. and Sierra Comunicaciones Globales, S. A. de C. V.

Starting on January 1, 2009, Telereunión, S. A. de C. V., Sierra USA, Communications, Inc. and Telscape de México, S. A. de C. V. became guarantors of the abovementioned Senior notes.

F-92

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

																			NON-GUARANTOR
																			SUBSIDIARIES
											Maxcom		Maxcom								Sierra
	Maxcom		CTE		MSA		OOP		MSF		USA		TV		TECBTC		SCG		Telereunión		USA			Telscape		Elimination			Consolidated
Balance sheet as of December 31, 2008:
Cash and cash equivalents and Current restricted cash	$	1,585,470		185		1,037		377		225						170		29		112		3,800					0			1,591,405
Accounts receivable — net		1,061,998		12,140		75,368		15,948		191,314		110		50		2,427		212		71,902		2,609			1,163		(476,940	)		958,301
Inventory — net		40,876																												40,876
Prepaid expenses		24,167		1,124		4,985		92								22				373		15								30,778
Investment in subsidiaries		341,530				8,820																					(350,350	)		0
Frequency rights — net		66,716																												66,716
Telephone network system and Equipment net		4,503,806																11,143		139,939		8,540			20,985					4,684,413
Preoperating expenses — net		50,595												268																50,863
Intangible assets — net		209,683																												209,683
Deposits		2,151		406		7				4,497										1,235		19								8,315
Prepaid expenses long term		15,381																												15,381
Derivative financial instruments		105,270																												105,270
Deferred taxes		90,996		864		5,931		77		16,280				1		8		3,145		29,995					817					148,114
Other assets		6,377																				(20	)							6,357
Total assets	$	8,105,016		14,719		96,148		16,494		212,316		110		319		2,627		14,529		243,556		14,963			22,965		(827,290	)		7,916,472
Total liabilities	$	3,603,847		13,777		70,834		8,633		3,394		7		292		1,669		111		184,491		4,565			624		(476,941	)		3,415,303

F-93

																						NON-GUARANTOR
																						SUBSIDIARIES
												Maxcom			Maxcom										Sierra
	Maxcom			CTE		MSA		OOP		MSF		USA			TV			TECBTC		SCG		Telereunión			USA			Telscape			Elimination			Consolidated
Shareholders’ Equity:
Capital Stock and Additional Paid- In Capital		6,226,687			96		66		55		171,497		127			56			54		11,308		712,814			13,044			97,874			(1,006,991	)		6,226,687
Accumulated deficit		(1,705,231	)		846		25,248		7,806		37,425		(24	)		(29	)		904		3,110		(653,749	)		(2,646	)		(75,533	)		656,642			(1,705,231	)
Repurchase of shares		(20,287	)																																(20,287	)
Total shareholders’ equity		4,501,169			942		25,314		7,861		208,922		103			27			958		14,418		59,065			10,398			22,341			(350,349	)		4,501,169
Total liabilities and shareholders — equity	$	8,105,016			14,719		96,148		16,494		212,316		110			319			2,627		14,529		243,556			14,963			22,965			(827,290	)		7,916,472

F-94

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

																				NON-GUARANTOR
																				SUBSIDIARIES
												Maxcom		Maxcom								Sierra
	Maxcom			CTE		MSA		OOP		MSF		USA		TV		TECBTC		SCG		Telereunión		USA		Telscape		Elimination			Consolidated
Total shareholders’ equity under Mexican GAAP	$	4,501,169			942		25,314		7,861		208,922		103		27		958		14,418		59,065		10,398		22,341		(350,349	)		4,501,169
Preoperating expenses	$	(391,951	)																											(391,951	)
Amortization of preoperating expenses		336,172																												336,172
Capitalization of interest		8,440																												8,440
Amortization of capitalized interest		(64,465	)																											(64,465	)
Installation revenues		(76,805	)																											(76,805	)
Installation costs		(738,412	)																											(738,412	)
Capitalized internal compensation cost		(2,000	)																											(2,000	)
Impairment charge		532,315																												532,315
Severance indemnity liability		(11,297	)																											(11,297	)
SAB 108 initial effect		7,034																												7,034
SAB effects for the year		3,035																												3,035
Recognition of deferred taxes		111,420																												111,420
Total shareholders’ equity under US. GAAP	$	4,214,655																												4,214,655

F-95

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

																											NON-GUARANTOR
																											SUBSIDIARIES
																Maxcom		Maxcom												Sierra
	Maxcom			CTE			MSA			OOP			MSF			USA		TV			TECBTC			SCG			Telereunión			USA			Telscape			Elimination			Consolidated
Statements of Operations for the year ended December 31, 2008:
Revenues	$	2,676,392			80,022			502,434			90,880											17,535			213			42,644			2,535			1,164			(730,590	)		2,683,229
Operating cost and expenses		(2,581,692	)		(75,630	)		(424,476	)		(86,651	)		(11	)				(11	)		(16,725	)		(203	)		(35,321	)		(2,092	)		(15	)		731,129			(2,491,698	)
Integral (cost) income of financing		(267,025	)		(126	)		(1,683	)		(159	)		17,728								(35	)		3			(16,066	)		(29	)		(1	)					(267,393	)
Other income (expenses)		(265,438	)		(3,368	)		(51,066	)		(999	)		15,284					(3	)		4			3,126			(18,206	)		74			(1,590	)		(39,719	)		(361,901	)
Net (loss) income	$	(437,763	)		898			25,209			3,071			33,001			0		(14	)		779			3,139			(26,949	)		488			(442	)		(39,180	)		(437,763	)
Net (loss) income for the year under Mexican GAAP	$	(437,763	)		898			25,209			3,071			33,001			0		(14	)		779			3,139			(26,949	)		488			(442	)		(39,180	)		(437,763	)
Amortization of preoperating expenses		22,123																																						22,123
Capitalization of interest		(112,738	)																																					(112,738	)
Amortization of capitalized Interest		(12,118	)																																					(12,118	)
Installation revenues		(2,824	)																																					(2,824	)
Installation costs		(154,716	)																																					(154,716	)
Capitalized internal compensation cost		143																																						143
Impairment		532,315																																						532,315
Severance indemnity liability		2,405																																						2,405
Recognition at deferred taxes		(76,885	)																																					(76,885	)
Net loss (income) for the year Under U.S. GAAP	$	(240,058	)																																					(240,058	)

F-96

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

																											NON-GUARANTOR
																											SUBSIDIARIES
																Maxcom		Maxcom												Sierra
	Maxcom			CTE			MSA			OOP			MSF			USA		TV			TECBTC			SCG			Telereunión			USA			Telscape			Elimination			Consolidated
Statement of Cash Flows under U.S. GAAP for the Year Ended December 31, 2008:
Net (loss) income the year under U.S. GAAP		(240,058	)		898			25,209			3,071			33,001			0		(14	)		779			3,139			(26,949	)		488			(442	)		(39,180	)		(240,058	)
Depreciation and amortization		440,104																							203			20,150			938						15,418			476,813
Other adjustments to reconcile net income to cash provided by operating activities		428,588			(852	)		(1,648	)		(76	)		(16,280	)				(1	)		(8	)		(3,146	)		(29,995	)					(817	)		48,596			424,361
Net change in working capital		(213,818	)		(1,258	)		(25,367	)		(3,053	)		(19,295	)		0		15			(840	)		(193	)		(17,409	)		(1,910	)		1,259			59,614			(222,255	)
Resources (used in) provided by Operating activities		414,816			(1,212	)		(1,806	)		(58	)		(2,574	)		0		0			(69	)		3			(54,203	)		(484	)		0			84,448			438,861
Resources used in financing activities		(102,692	)																									10,510									(13,258	)		(105,440	)
Resources (used in) provided by investing activities		(1,252,698	)																									42,320			17						(71,190	)		(1,281,551	)
Cash and cash equivalents:
Net increase (decrease) in cash and cash equivalents		(940,574	)		(1,212	)		(1,806	)		(58	)		(2,574	)		0		0			(69	)		3			(1,373	)		(467	)		0			(0	)		(948,130	)
Beginning balances		2,526,044			1,398			2,842			435			2,799					0			239			26			1,485			4,267			0			0			2,539,535
Ending balances		1,585,470			185			1,037			377			225			0		0			170			29			112			3,800			0			(0	)		1,591,405

F-97

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

																					NON-GUARANTOR
																					SUBSIDIARIES
													Maxcom			Maxcom								Sierra
	Maxcom			CTE			MSA		OOP		MSF		USA			TV			TECBTC		Telereunión			USA			Telscape			SCG			Elimination			Consolidated
Balance sheet as of December 31, 2007:
Cash and cash equivalents and Current restricted cash		2,526,044			1,398			2,842		435		2,799								239		1,485			4,267						26			—			2,539,535
Accounts receivable — net		742,528			6,338			53,419		11,748		170,804		110			51			1,552		16,406			14,550			2,081			19			(249,093	)		770,513
Inventory — net		33,249																																			33,249
Prepaid expenses		49,471			339			1,966		9												9,830			15												61,630
Investment in subsidiaries		299,637						4,969																										(304,606	)		—
Frequency rights — net		80,930																																			80,930
Telephone network system and Equipment net		3,944,727																				202,410			9,478			20,985			11,346						4,188,946
Preoperating expenses — net		77,634															268																				77,902
Intangible assets — net		208,802																																			208,802
Obligations					1,890			15,760																													17,650
Deposits		1,038			257			7				4,276										1,350			15												6,943
Derivative financial instruments		13,475																																			13,475
Other assets		9,270						5,272																										(17	)		14,525
Total assets		7,986,805			10,222			84,235		12,192		177,879		110			319			1,791		231,481			28,325			23,066			11,391			553,716	)		8,014,100
Total liabilities		2,955,966			10,178			84,130		7,402		1,958		7			278			1,612		151,374			18,415			400			112			(248,571	)		2,983,261
Shareholders’ Equity:
Capital Stock and Additional Paid- In Capital		6,298,307			96			66		55		171,496		127			56			53		702,304			13,044			97,875			11,308			(996,480	)		6,298,307
Accumulated deficit		(1,267,468	)		(52	)		39		4,735		4,425		(24	)		(15	)		126		(622,197	)		(3,134	)		(75,209	)		(29	)		691,335			(1,267,468	)
Total shareholders’ equity		5,030,839			44			105		4,790		175,921		103			41			179		80,107			9,910			22,666			11,279			(305,145	)		5,030,839
Total liabilities and shareholders — equity		7,986,805			10,222			84,235		12,192		177,879		110			319			1,791		231,481			28,325			23,066			11,391			(553,716	)		8,014,100
Total shareholders’ equity under Mexican GAAP		5,030,839			44			105		4,790		175,921		103			41			179		80,107			9,910			22,666			11,279			(305,145	)		5,030,839

F-98

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

											NON-GUARANTOR
											SUBSIDIARIES
								Maxcom	Maxcom			Sierra
	Maxcom			CTE	MSA	OOP	MSF	USA	TV	TECBTC	Telereunión	USA	Telscape	SCG	Elimination	Consolidated
Preoperating expenses		(391,951	)														(391,951	)
Amortization of preoperating expenses		314,049															314,049
Capitalization of interest		121,178															121,178
Amortization of capitalized interest		(52,347	)														(52,347	)
Installation revenues		(73,981	)														(73,981	)
Installation costs		(583,696	)														(583,696	)
Capitalized internal compensation cost		(2,143	)														(2,143	)
Severance Indemnity liability		(1,590	)														(1,590	)
SAB 108 initial effect		7,034															7,034
SAB effects for the year		3,035															3,035
Recognition of deferred taxes		184,914															184,914
Total shareholders’ equity under US. GAAP		4,555,341															4,555,341

F-99

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

																									NON-GUARANTOR
																									SUBSIDIARIES
																Maxcom			Maxcom									Sierra
	Maxcom			CTE			MSA			OOP			MSF			USA			TV			TECBTC			Telereunión			USA			Telscape			SCG		Elimination			Consolidated
Statements of Operations for the year ended December 31, 2007:
Revenues		2,339,795			56,594			409,537			78,075												3,521			42,294			6,675								(590,772	)		2,345,719
Operating cost and expenses		(2,052,063	)		(54,565	)		(415,628	)		(73,266	)		(17	)		(7	)		(10	)		(3,339	)		(55,897	)		(8,523	)							590,234			(2,073,081	)
Integral (cost) income of financing		(112,592	)		(46	)		1,026			(253	)		391			(4	)		(2	)		(22	)		(13,541	)		(1,520	)		(78	)							(126,641	)
Other income (expenses)		(138,944	)		(890	)		2,553			(1,360	)		11,889									(52	)		17,701			322			(400	)				(620	)		(109,801	)
Net (loss) income		36,196			1,093			(2,512	)		3,196			12,263			(11	)		(12	)		108			(9,443	)		(3,046	)		(478	)				(1,158	)		36,196
Net (loss) income for the year under Mexican GAAP		36,196			1,093			(2,512	)		3,196			12,263			(11	)		(12	)		108			(9,443	)		(3,046	)		(478	)				(1,158	)		36,196
																																			��
Preoperating expenses
Amortization of preoperating expenses		20,438																																						20,438
Capitalization of interest		(716	)																																					(716	)
Amortization of capitalized Interest		(11,896	)																																					(11,896	)
Installation revenues		(6,758	)																																					(6,758	)
Installation costs		(60,640	)																																					(60,640	)
Debt restructuring
Capitalized internal compensation cost		143																																						143
Severance indemnity liability		(682	)																																					(682	)
Reversal of SAB 108
Net loss (income)
Recognition at deferred taxes		184,914																																						184,914
Net loss (income)
For the year Under U.S. GAAP		160,999																																						160,999

F-100

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

																								NON-GUARANTOR
																								SUBSIDIARIES
																Maxcom			Maxcom								Sierra
	Maxcom			CTE			MSA			OOP			MSF			USA			TV			TECBTC		Telereunión			USA			Telscape			SCG			Elimination			Consolidated
Statement of Cash Flows under U.S. GAAP for the Year Ended December 31, 2007:
Net (loss) income the year under U.S. GAAP		160,999			1,093			(2,512	)		3,196			12,263			(11	)		(12	)		108		(9,443	)		(3,046	)		(478	)					(1,158	)		160,999
Depreciation and amortization		314,601																																			13,668			328,269
Other adjustments to reconcile net income to cash provided by operating activities		(93,909	)		414			(5,200	)					(11,958	)										(4,499	)											11,291			(103,861	)
Net change in working capital		(246,075	)		(1,046	)		12,734			(2,793	)		(954	)		11			280			121		4,273			4,527			478			93			7,383			(220,968	)
Resources (used in) provided by Operating activities		135,616			461			5,022			403			(649	)					268			229		(9,669	)		1,481						93			31,184			164,439
Resources used in financing activities		2,913,462			3																				(927	)											3,939			2,916,477
Resources (used in) provided by investing activities		(1,215,275	)					(3,303	)											(268	)				7,180			1,370						(67	)		(34,718	)		(1,245,081	)
Effect of inflation on cash and cash equivalents		(35,186	)																																		(405	)		(35,591	)
Cash and cash equivalents:
Net increase (decrease) in cash and cash equivalents		1,798,617			464			1,719			403			(649	)								229		(3,416	)		2,851						26						1,800,244
Beginning balances		727,427			934			1,123			32			3,448									10		4,901			1,416									—			739,291
Ending balances		2,526,044			1,398			2,842			435			2,799			—			—			239		1,485			4,267			—			26						2,539,535

F-101

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

																						NON-GUARANTOR
																						SUBSIDIARIES
														Maxcom			Maxcom								Sierra
	Maxcom			CTE			MSA		OOP		MSF			USA			TV			TET		Telereunión			USA			Telscape			Elimination			Consolidated
Balance sheet as of December 31, 2006:
Cash and cash equivalents and Current restricted cash		750,889			934			1,123		32		3,448									10		4,901			1,416						—			762,753
Accounts receivable — net		439,423			30,098			220,461		45,443		167,741			114			52			673		57,386			12,833			2,159			(491,126	)		485,257
Inventory — net		35,790																																	35,790
Prepaid expenses		64,412			264			988		10													51			15									65,740
Investment in subsidiaries		306,567						1,666																								(308,233	)		—
Frequency rights — net		88,374																																	88,374
Telephone network system and Equipment net		3,060,002																					209,590			10,861			20,984						3,301,437
Preoperating expenses — net		98,340																																	98,340
Intangible assets — net		190,249																																	190,249
Obligations					1,600			13,468																											15,068
Deposits		369			391			7				4,449											742			15									5,973
Deferred tax								2,393																											2,393
Other assets		14,548																								(18	)								14,530
Total assets		5,048,963			33,287			240,106		45,485		175,638			114			52			683		272,670			25,122			23,143			(799,359	)		5,065,904
Total liabilities		2,772,049			34,338			237,491		43,890		11,979			—			—			611		182,194			12,170			—			(505,732	)		2,788,990
Shareholders’ Equity:
Capital Stock and Additional Paid- In Capital		3,580,578			93			66		55		171,497			127			55			54		703,231			13,045			97,873			(986,096	)		3,580,578
Accumulated deficit		(1,303,664	)		(1,144	)		2,549		1,540		(7,838	)		(13	)		(3	)		18		(612,755	)		(93	)		(74,730	)		692,469			(1,303,664	)
Total shareholders’ equity		2,276,914			(1,051	)		2,615		1,595		163,659			114			52			72		90,476			12,952			23,143			(293,627	)		2,276,914
Total liabilities and Shareholders — equity		5,048,963			33,287			240,106		45,485		175,638			114			52			683		272,670			25,122			23,143			(799,359	)		5,065,904
Total shareholders’ equity under Mexican GAAP		2,276,914			(1,051	)		2,615		1,595		163,659			114			52			72		90,476			12,952			23,143			(293,627	)		2,276,914

F-102

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

											NON-GUARANTOR
											SUBSIDIARIES
								Maxcom	Maxcom			Sierra
	Maxcom			CTE	MSA	OOP	MSF	USA	TV	TET	Telereunión	USA	Telscape	Elimination	Consolidated
Preoperating expenses		(391,951	)													(391,951	)
Amortization of preoperating expenses		293,611														293,611
Capitalization of interest		121,894														121,894
Amortization of capitalized interest		(40,451	)													(40,451	)
Installation revenues		(67,225	)													(67,225	)
Installation costs		(523,056	)													(523,056	)
Capitalized internal compensation cost		(2,285	)													(2,285	)
Severance Indemnity liability		(908	)													(908	)
SAB 108 initial effect		7,034														7,034
SAB effects for the year		3,035														3,035
Total shareholders’ equity under US. GAAP		1,676,612														1,676,612

F-103

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

																									ON-GUARANTOR
																									SUBSIDIARIES
																Maxcom			Maxcom									Sierra
	Maxcom			CTE			MSA			OOP			MSF			USA			TV			TET			Telereunión			USA			Telscape			Elimination			Consolidated
Statements of Operations for the year ended December 31, 2006:
Revenues		1,716,316			45,170			338,295			63,114												907			88,308			14,171						(524,589	)		1,741,692
Operating cost and expenses		(1,585,904	)		(43,871	)		(334,952	)		(61,413	)		4,455									(886	)		(71,801	)		(15,167	)					524,589			(1,584,950	)
Integral (cost) income of financing		(122,543	)		10			(100	)		(114	)		4,360			(4	)		(2	)		(3	)		10,488			798			(72	)					(107,182	)
Other income (expenses)		(37,136	)		(308	)		1,811			(51	)		(13,742	)											1			29						(29,431	)		(78,827	)
Net (loss) income		(29,267	)		1,001			5,054			1,536			(4,927	)		(4	)		(2	)		18			26,996			(169	)		(72	)		(29,431	)		(29,267	)
Net (loss) income for the year under Mexican GAAP		(29,267	)		1,001			5,054			1,536			(4,927	)		(4	)		(2	)		18			26,996			(169	)		(72	)		(29,431	)		(29,267	)
Preoperating expenses
Amortization of preoperating expenses		32,030																																				32,030
Capitalization of interest		49,945																																				49,945
Amortization of capitalized Interest		(27,136	)																																			(27,136	)
Installation revenues		858																																				858
Installation costs		(213,247	)																																			(213,247	)
Debt restructuring		197,006																																				197,006
Capitalized internal compensation cost		143																																				143
Severance Indemnity liability		(908	)																																			(908	)
Reversal of SAB 108		3,035																																				3,035
Net loss (income) for the year Under U.S. GAAP		12,459																																				12,459

F-104

MAXCOM TELECOMUNICACIONES, S. A. B. DE C. V. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Thousands of Mexican pesos — note 5)

																					NON-GUARANTOR
																					SUBSIDIARIES
													Maxcom			Maxcom							Sierra
	Maxcom			CTE		MSA		OOP		MSF			USA			TV			TET		Telereunión		USA			Telscape			Elimination			Consolidated
Statement of Cash Flows under U.S. GAAP for the Year Ended December 31, 2006:
Net (loss) income the year under U.S. GAAP		12,459			1,001		5,054		1,536		(4,927	)		(4	)		(2	)		18		26,996		(169	)		(72	)		(29,431	)		12,459
Depreciation and amortization		159,284																												8,437			167,721
Other adjustments to reconcile net income to cash provided by operating activities		(47,558	)																											47,657			99
Net change in working capital		(87,032	)																											(214,152	)		(301,184	)
Resources (used in) provided by Operating activities		37,153			1,001		5,054		1,536		(4,927	)		(4	)		(2	)		18		26,996		(169	)		(72	)		(187,489	)		(120,905	)
Resources used in financing activities		1,326,567																												205,177			1,531,744
Resources (used in) provided by investing activities		(861,744	)																											(43,144	)		(904,888	)
Effect of inflation on cash and cash equivalents		(7,560	)																											(318	)		(7,878	)
Cash and cash equivalents:
Net increase (decrease) in cash and cash equivalents		494,416			1,001		5,054		1,536		(4,927	)		(4	)		(2	)		18		26,996		(169	)		(72	)		(25,774	)		498,073
Beginning balances		233,011																												8,207			241,218
Ending balances		727,427			1,001		5,054		1,536		(4,927	)		(4	)		(2	)		18		26,996		(169	)		(72	)		(17,567	)		739,291

F-105

j. Valuation and Qualifying Accounts -
Amounts expressed in Million of Mexican Pesos ($)

		Balance at		Charged to
		Beginning of		Cost and						Balance at End
		Period		Expenses			Deductions			of Period
Allowance for doubtful accounts	2008	$	107.7	$	106.3		$	(52.0	)	$	161.9
	2007	$	92.7	$	63.4		$	(48.4	)	$	107.7
	2006	$	74.3	$	59.6		$	(41.2	)	$	92.7
Allowance for obsolete and slow- moving supply inventories	2008	$	0.3		(0.3	)	$	—		$	—
	2007	$	0.3		—			(0.3	)	$	0.1
	2006	$	0.3		—			—		$	0.3
Allowance for obsolete and slow- moving network inventories	2008	$	9.3		21.7		$	(17.3	)	$	13.7
	2007	$	10.0		—		$	(0.7	)	$	9.3
	2006	$	10.2		—		$	(0.1	)	$	10.0

F-106

ITEM 19. EXHIBITS

1.1	Amended and Restated Bylaws(estatutos)of Maxcom Telecomunicaciones, S.A. de C.V. (English translation), filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 13, 2008, is incorporated herein by reference.
2.1	Senior Note Indenture, dated December 20, 2006, among Maxcom Telecomunicaciones, S.A. de C.V., Maxcom Servicios Administrativos, S.A. de C.V., Outsourcing Operadora de Personal, S.A. de C.V., Técnicos Especializados en Telecomunicaciones, S.A. de C.V., Corporativo en Telecomunicaciones, S.A. de C.V., Maxcom SF, S.A. de C.V., Maxcom TV, S.A. de C.V., Maxcom USA, Inc. and Deutsche Bank Trust Company Americas, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 26, 2007, is incorporated herein by reference.
2.2	First Supplemental Indenture, dated September 5, 2007, among Maxcom, the guarantors a party thereto and Deutsche Bank Trust Company Americas, as trustee, filed as an exhibit to our registration statement on Form F-1/A (No. 333-145800), filed with the SEC on November 1, 2007, is incorporated herein by reference.
2.3	Second Supplemental Indenture, dated January 25, 2008, among Sierra Comunicaciones Globales, S.A. de C.V., the existing guarantors party thereto and Deutsche Bank Trust Company Americas, as trustee, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 13, 2008, is incorporated herein by reference.
2.4	Form of Deposit Agreement among Maxcom, the Depositary named therein and all holders of American Depositary Shares issued thereunder, filed as an exhibit to our registration statement on Form F-1/A (No. 333-144771), filed with the SEC on October 2, 2007, is incorporated herein by reference.
2.5	Form of Registration Rights Agreement by and among Maxcom, Nexus-Maxcom Holdings I, LLC, BASCFC-Maxcom Holding I, LLC, BAS Capital Funding Corporation, BankAmerica Investment Corporation and the other stockholders party thereto, filed as an exhibit to our registration statement on Form F-1/A (No. 333-144771), filed with the SEC on October 2, 2007, is incorporated herein by reference.
2.6	Third Amended and Restated Securityholders Agreement, dated July 20, 2006, among Maxcom Telecomunicaciones, S.A. de C.V. and certain of its shareholders, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 26, 2007, is incorporated herein by reference.
3.1	CPO Trust Agreement effective April 25, 2002 among Maxcom., its shareholders and Banco Nacional de México, S.A., Institución de Banca Múltiple, Grupo Financiero Banamex Accival, as trustee, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on July 1, 2002, is incorporated herein by reference.
3.2	CPO Trust Agreement, dated October 17, 2007, among Maxcom Telecomunicaciones, S.A. de C.V., its shareholders and Nacional Financiera, S.N.C. (English translation), filed as an exhibit to our registration statement on Form F-1/A (No. 333-144771), filed with the SEC on October 17, 2007, is incorporated herein by reference.
3.3	CPO Deed, dated October 17, 2007, among Nacional Financiera, S.N.C., Institución de Banca de Desarrollo, Monex Casa de Bolsa, S.A. de C.V., Grupo Financiero Monex and Comisíon Nacional Bancaria y de Valores (English translation), filed as an exhibit to our registration statement on Form F-1/A (No. 333-144771), filed with the SEC on October 17, 2007, is incorporated herein by reference.
4.1	Agreement for the use of infrastructure and installation of fiber optic cable on the highways between Puebla and México, dated August 18, 1998, between Amaritel, S.A. de C.V. (the predecessor of Maxcom Telecomunicaciones, S.A. de C.V.) and Iusatel, S.A. de C.V., filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.2	Interconnection Agreement for long-distance services, dated January 22, 1999, between Amaritel and Teléfonos de México (Telmex) valid for an initial period of two years between February 1, 1999 and January 1, 2001, and in effect thereafter in accordance with article 42 of the Mexican Telecommunications law, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.3	Local Interconnection Service Agreement, dated November 24, 1998, between Amaritel, S.A. de C.V. and Teléfonos de México, S.A. de C.V., filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.

4.4	Amendment to Local Interconnection Service Agreement, dated February 25, 1999, between Amaritel, S.A. de C.V. and Teléfonos de México, S.A. de C.V., originally entered into on November 24, 1998, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.5	Metropolitan Network Capacity Sale Agreement, dated April 28, 2000, between Maxcom Telecomunicaciones, S.A. de C.V. and Metro Net, S.A. de C.V., as amended on December 21, 2000, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 29, 2001, is incorporated herein by reference.
4.6	Telecommunications Service Agreement, dated November 15, 1999, between Maxcom and Teléfonos de México, S.A. de C.V. , filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.7	Telecommunications Service Agreement, dated March 9, 1999, between Maxcom and Bestel S.A. de C.V., pursuant to which Bestel will provide long-distance and private call services to Maxcom, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.8	Concession for the installation and operation of telecommunications services granted to Amaritel, S.A. de C.V. by the Secretary of Telecommunications and Transport on December 20, 1996, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.9	Amendment to Concession for the installation and operation of telecommunications services granted to Amaritel by the Secretary of Telecommunications and Transport on December 20, 1996, dated September 8, 1999, extending the coverage of such concession to include various additional municipalities of the State of Mexico, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.10	Amendment to Concession for the installation and operation of telecommunications services granted to Amaritel by the Secretary of Telecommunications and Transport on December 20, 1996, dated December 7, 1999, authorizing Maxcom to employ whatever technologies it deems appropriate in providing telecommunications services to various municipalities, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.11	Amendment to Annex A and B of Concession for the installation and operation of telecommunications services granted to Amaritel, S.A. de C.V. by the Secretary of Telecommunications and Transport on December 20, 1996, dated September 27, 2001, extending the coverage of such concession to include all of Mexico, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.12	Concession for a public telecommunications network in telecommunications regions 3, 5 and 8 granted to Amaritel, S.A. de C.V. by the Secretary of Telecommunications and Transport on April 29, 1998, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.13	Concession for the operation of point-to-multipoint microwave telecommunications services in Region 5 granted to Amaritel, S.A. de C.V. by the Secretary of Telecommunications and Transport on April 23, 1998, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.14	Concession for the operation of point-to-multipoint microwave telecommunications services in Region 3 granted to Amaritel, S.A. de C.V. by the Secretary of Telecommunications and Transport on April 23, 1998, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.15	Concession for the operation of point-to multipoint microwave telecommunications services in Region 8 granted to Amaritel, S.A. de C.V. by the Secretary of Telecommunications and Transport on April 29, 1998, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.16	Concessions for the nationwide operation of point-to-point microwave telecommunications services using five frequency bands in the 56 MHz bandwidth, each granted to Amaritel, S.A. de C.V. by the Secretary of Telecommunications and Transport on June 4, 1998, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.

4.17	Concessions for the nationwide operation of point-to-point microwave telecommunications services using two frequency bands in the 100 MHz bandwidth, each granted to Amaritel, S.A. de C.V. by the Secretary of Telecommunications and Transport on June 4, 1998, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.18	Amendment to Concession for the operation of point-to-multipoint telecommunications services in Regions 3, 5, 8 granted to Amaritel, S.A. de C.V. by the Secretary of Telecommunications and Transport on April 1, 1998, dated October 12, 1999, regarding the start date for the initiation of services, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.19	Amendment to Concession for the installation and operation of telecommunications services granted to Amaritel, S.A. de C.V. by the Secretary of Telecommunications and Transport on December 20, 1996, dated September 24, 1999 eliminating financial restrictions, filed as an exhibit to our registration statement on Form F-4 (No. 333-11910), filed with the SEC on May 5, 2000, is incorporated herein by reference.
4.20	Warrant Agreement, dated as of March 17, 2000, between Maxcom Telecomunicaciones, S.A. de C.V. and The Bank of New York, as warrant agent, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 29, 2001, is incorporated herein by reference.
4.21	Dark Fiber Optic Purchase Agreement, dated as of August 13, 2002, between Maxcom Telecomunicaciones, S.A. de C.V. and Bestel S.A. de C.V., filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2003, is incorporated herein by reference.
4.22	Transactional Lease Termination Agreement, dated as of May 20, 2003, among Maxcom Telecomunicaciones, S.A. de C.V. and Jacobo Zaga Romano, Jacobo Zaga Buzali, et.al., filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2003, is incorporated herein by reference.
4.23	Capacity Sale Agreement, dated as of October 15, 2003, between Maxcom Telecomunicaciones, S.A. de C.V. and Axtel, S.A. de C.V., filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 24, 2004, is incorporated herein by reference.
4.24	Credit Agreement, dated April 28, 2004, by and among Banco Santander Mexicano, S.A., Institución de Banca Mútiple Grupo Financiero Santander Serfin, as lenders, and Maxcom, as borrower, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2005, is incorporated herein by reference.
4.25	Credit Agreement, dated April 13, 2005, by and among Ixe Banco, S.A., Institución de Banca Mútiple, Ixe Grupo Financiero., as lenders, and Maxcom, as borrower, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2005, is incorporated herein by reference.
4.26	Amendment dated August 5, 2004 to Exhibit B of the Master Agreement to Supply Local Interconnection Services, dated February 25, 1999, between Maxcom and Telefonos de México, S.A. de C.V., filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2005, is incorporated herein by reference.
4.27	Credit Agreement, dated April 13, 2005, by and among Ixe Banco, S.A., Institución de Banca Múltiple, Ixe Grupo Financiero, as lenders, and Maxcom, as borrower, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2006, is incorporated herein by reference.
4.28	Credit Agreement, dated October 25, 2005, by and among Ixe Banco, S.A., Institución de Banca Múltiple, Ixe Grupo Financiero, as lenders, Maxcom, as borrower and Maxcom SF, S.A. de C.V. as joint and several obligor, and amendment dated December 13, 2005, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2006, is incorporated herein by reference.
4.29	Credit Agreement, dated October 21, 2005, by and among Banco Mercantil del Norte, S.A., Institución de Banca Múltiple, Grupo Financiero Banorte, as lenders and Maxcom, as borrower, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2006, is incorporated herein by reference.
4.30	Irrevocable Trust Agreement, dated November 21, 2005, by and among Maxcom, as settlor, Banco Mercantil del Norte, S.A., Institución de Banca Múltiple, Grupo Financiero Banorte and Ixe Banco, S.A., Institución de Banca Múltiple, Ixe Grupo Financiero, as trust beneficiaries and HSBC México, S.A., Institución de Banca Múltiple, Grupo Financiero HSBC, Trust Division, as trustees, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2006, is incorporated herein by reference.

4.31		Minutes of Maxcom Shareholders Meeting dated August 31, 2005 approving the spin-off, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2006, is incorporated herein by reference.
4.32		Stock Purchase Agreement, dated November 22, 2005, by and among Maxcom and Maxcom SF, S.A. de C.V., as sellers and Tiendas Comercial Mexicana, S.A. de C.V. and Controladora Comercial Mexicana, S.A. de C.V., as buyers, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2006, is incorporated herein by reference.
4.33		Supply and Installation Agreement of Video Through DSL (IPTV) System dated December 15, 2006 by and among Maxcom Telecomunicaciones, S.A. de C.V., Alcatel Bell N.V. and Alcatel México, S.A. de C.V., filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 26, 2007, is incorporated herein by reference.
4.34		The First Executive Stock Option Plan, which includes a Trust Agreement, dated May 31, 1999, among Maxcom Telecomunicaciones, S.A. de C.V. and Banco Nacional de México (English translation) , filed as an exhibit to our registration statement on Form F-1/A (No. 333-144771), filed with the SEC on September 12, 2007, is incorporated herein by reference.
4.35		Second Executive Stock Option Plan, dated July 17, 2006 (English translation), filed as an exhibit to our registration statement on Form F-1/A (No. 333-144771), filed with the SEC on September 12, 2007, is incorporated herein by reference.
6.1		Computation of earnings per share, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2009, is incorporated herein by reference.
7.1		Computation of ratio of earnings to fixed charges, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2009, is incorporated herein by reference.
8.1		Subsidiaries of the Registrant, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2009, is incorporated herein by reference.
11.1		Maxcom’s Code of Ethics adopted March 2006, filed as an exhibit to our annual report on Form 20-F, filed with the SEC on June 30, 2006, is incorporated herein by reference.
12.1	*	Certification of the Chief Executive Officer pursuant to Rule 13a-14(a).
12.2	*	Certification of the Chief Financial Officer pursuant to Rule 13a-14(a).
13.1	*	Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350.
13.2	*	Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350.

* Filed herewith.

SIGNATURES

Pursuant to the requirements of Section 12 of the Securities and Exchange Act of 1934, the registrant certifies that it meets all requirements for filing this Amendment No. 1 on Form 20-F/A and has duly caused this Amendment No. 1 on Form 20-F/A to be signed on its behalf by the undersigned, thereunto duly authorized.

MAXCOM TELECOMUNICACIONES, S.A.B. DE C.V.
By:	/s/ Jose Antonio Solbes
	José Antonio Solbes
	Chief Financial Officer

DATE: July 1, 2009

EXHIBIT INDEX

12.1	Certification of the Chief Executive Officer pursuant to Rule 13a-14(a).
12.2	Certification of the Chief Financial Officer pursuant to Rule 13a-14(a).
13.1	Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350.
13.2	Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350.