Report of Foreign Issuer (6-k)

COSAN LIMITED

March 19, 2015

/s/ Marcelo Eduardo Martins

Marcelo Eduardo Martins

Chief Financial Officer and Investor Relations Officer

FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

For the month of March, 2015

Commission File Number: 1-33659

COSAN LIMITED

(Translation of registrant’s name into English)

Av. Juscelino Kubitschek, 1327 – 4th floor

São Paulo, SP 04543-000 Brazil

(Address of principal executive offices)

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

Form 20-F

Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes

COSAN LIMITED

Item
1.	Press Release dated March 18, 2015 regarding results for 4th quarter and Fiscal Year 2014
2.	Consolidated financial statements at December 31, 2014 and report of independent registered public accounting firm

Item 1

Net revenue growth of 11% and EBITDA of R$4.0 billion in 2014

São Paulo, March 18, 2015 - COSAN LIMITED S.A. (NYSE: CZZ; BM&FBOVESPA: CZLT33) announces today its results for the fourth quarter of fiscal year 2014 (4Q14)—October, November, and December 2014—and fiscal year 2014. The results are consolidated in accordance with the accounting principles adopted in Brazil and internationally (IFRS).

Earnings Conference Call Portuguese March 19, 2015 11:00 A.M. (Brasilia time) Phone: + 55 11 3193 1001 + 55 11 2820 4001 Access Code: COSAN English March 19, 2015 12:00 A.M. (Brasilia time) Phone (BR): + 55 11 3193 1001 + 55 11 2820 4001 Phone (USA): +1 786 924 6977 Access Code: COSAN	Highlights 2014
	o Raízen Combustíveis’s EBITDA was R$2.2 billion with growth of 8% in volume sold in 2014 o Raízen Energia's EBITDA was R$2.5 billion with 57 million tons of sugarcane crushed in the 2014/15 harvest o 40% growth in the commercial segment connections in Comgás o Record of 11.1 million tons loaded by Rumo at the Port of Santos

Investor Relationship	4Q14	4Q13	Summary of Financial Information - Cosan Consolidated¹	2014	2013
Email: ri@cosan.com	(Oct-Dec)	(Oct-Dec)	Amount in R$ MM	(Jan-Dec)	(Jan-Dec)
Telephone: +55 11 3897 9797	10,526.0	9,390.0	Net Revenue	39,998.7	36,165.1
Site: www.cosan.com.br	1,199.9	1,156.5	Gross Profit	4,825.7	4,606.4
Fiscal Year Definitions:	11.4%	12.3%	Gross Margin (%)	12.1%	12.7%
4Q14 - quarter ended December 30, 2014	588.3	577.5	Operating Profit	2,144.9	2,186.5
	1,096.2	1,014.1	EBITDA	4,047.1	3,953.1
	10.4%	10.8%	EBITDA Margin (%)	10.1%	10.9%
4Q13 - quarter ended December 31, 2013	(6.2)	4.5	Equity Pick-up	(29.4)	(10.2)
	69.0	344.2	Net Income before non-controlling Interest	659.3	697.3
	(29.1)	132.7	Net Income	171.0	210.9
2014 - 12 months beginning January 1, 2014 and closing December 31, 2014	-0.3%	1.4%	Net Margin (%)	0.4%	0.6%

	666.9	806.6	CAPEX	2,690.8	2,910.1
2013 - 12 months beginning January 1, 2013 and closing December 31, 2013	12,246.3	10,548.9	Proforma Net Debt (w/ preferred shareholders payable in subsidiaries)	12,246.3	10,548.9
	13,560.2	13,374.4	Shareholders' Equity and Minority Shareholders	13,560.2	13,374.4
	Note 1: Considering the consolidation of 50% of Raízen Combustíveis and Raízen Energia

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Cosan Limited-Earnings Release

4th Quarter of Fiscal Year 2014

Message from the CEO

We ended 2014 with many achievements reflected in our business’s performance. Despite the challenger economic scenario - with the downturn in the Brazilian economy, currency devaluation and high inflation - we were able to achieve the results committed with our shareholders.

We also announced a large corporate restructuring following the simplification of our business model in line with market demands. Gas, Energy and Logistics segments will operate more independently, with a focus on operational efficiency, organic growth and pursuing opportunities in their sectors.

We cannot expect a favorable economic scenario in 2015. It will be a period of great adjustments and high volatility. However, we are confident in our position and Raízen, Comgás, Radar and Lubrificantes are references in their markets.

Additionally, we have a huge challenge related to the integration of Rumo and ALL, recently approved by competent agencies. Our project will transform and expand cargo transportation business in Brazil through an efficient logistics.

Our main focus this year is on cash generation and leverage reduction. We aim to do more with less and to create organic value in operations. These will be the main themes of 2015.

Simplicity, agility, and entrepreneurism will continue to guide us seeking results that create value for our shareholders in our whole business portfolio.

Marcos Marinho Lutz

CEO – Cosan

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A.	Highlights and Business Units

A.1 Business Units

Listed below are the business units that make up Cosan S/A and Cosan Logística S/A, companies that comprise Cosan Limited’s portfolio.

The business units (reportable segments) are organized as follows:

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A.2 Cosan Limited’s Consolidated Result

Cosan Limited’s consolidated financial statements considers 100% of the results of Cosan S/A and Cosan Logística S/A.

EBITDA reported herein is in compliance with CVM Rule 527/12, published by the Brazilian Securities and Exchange Commission on October 4, 2012, and may differ from the amounts reported in prior periods as a result of the equity accounting income adjustment. Therefore, EBITDA now consists of operating profit before financial expenses, plus depreciation, amortization and equity accounting.

4Q14	4Q13		EBITDA (Reconciliation ICVM 527)	2014	2013
(Oct-Dec)	(Oct-Dec)	Chg. %	Amounts in R$ MM	(Jan-Dec)	(Jan-Dec)	Chg. %
(29.1)	132.7	n/a	Net Income	171.0	211.0	(19.)%
(130.0)	(88.9)	46.3%	(-) Equity Pick-up	(592.0)	(340.2)	74.%
-	-	n/a	(-) Income from Discontinued Operations	-	3.4	-100.%
92.3	209.2	-55.9%	(+) Minority Shareholders	471.5	472.3	-0.2%
17.9	(155.6)	n/a	(+) Income Taxes	43.8	103.3	-57.6%
333.8	254.4	31.2%	(+) Net Financial Expense (Revenue)	982.8	893.6	10.%
175.2	158.7	10.4%	(+) Depreciation and Amortization	679.1	598.4	13.5%
460.1	510.4	-9.9%	EBITDA (before ICVM 527)	1,756.3	1,941.9	-9.6%
130.0	88.9	46.3%	(+) Equity Pick-up	592.	340.2	74.%
590.2	599.3	-1.5%	EBITDA (after ICVM 527)	2,348.3	2,282.1	2.9%

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Below we present 4Q14 and 2014 results by business segment as previously detailed. All information reflect 100% of their financial performance, regardless of Cosan Limited’s interest.

For reconciliation purposes of the consolidated EBITDA, the Adjustments and Eliminations column refers to the elimination of net profits of the business controlled by Cosan for consolidation purposes.

Results by Business Unit 4Q14	Cosan Energia Proforma	Cosan Logística	CZZ (Parent)	Ajustments and Eliminations	CZZ Proforma
Net Revenue	10,270.2	255.7	-	-	10,526.0
Cost of Goods and Services	(9,148.5)	(177.6)	-	-	(9,326.1)
Gross Profit	1,121.8	78.1	-	0.0	1,199.9
Gross Margin(%)	10.9%	30.6%	n/a	- %	11.4%
Selling Expenses	(429.8)	-	-	-	(429.8)
General and Administrative Expenses	(264.8)	(24.2)	(1.2)	0.0	(290.2)
Other Operating Revenues (Expenses)	118.7	(10.3)	-	-	108.4
Equity Pick-up	(6.2)	(0.0)	(40.3)	40.3	(6.2)
Depreciation and Amortization	487.3	26.9	-	-	514.1
EBITDA	1,026.9	70.5	(41.5)	40.3	1,096.2
EBITDA Margin (%)	10.%	27.6%	n/a	- %	10.4%
Financial income	(432.2)	(13.8)	(6.7)	(0.0)	(452.7)
Financial expense	157.8	2.5	0.0	-	160.4
Foreign exchange gain (losses), net	(349.8)	0.7	13.3	-	(335.8)
Derivatives	114.1	-	5.8	-	119.9
Income taxes expenses	6.5	(11.3)	-	0.0	(4.8)
Non-controlling interests	(119.5)	(5.5)	-	26.9	(98.1)
Profit (loss) for the period	(83.5)	16.3	(29.1)	67.2	(29.1)

Results by Business Unit 2014	Cosan Energia Proforma	Cosan Logística	CZZ (Parent)	Ajustments and Eliminations	CZZ Proforma
Net Revenue	39.083,3	915,4	-	-	39.998,7
Cost of Goods and Services	(34.562,6)	(610,4)	-	-	(35.173,0)
Gross Profit	4.520,7	305,1	-	0.0	4.825,7
Gross Margin(%)	11.6%	33.3%	n/a	- %	12.1%
Selling Expenses	(1.746,3)	-	-	-	(1.746,3)
General and Administrative Expenses	(1.004,5)	(87,8)	(19,3)	-	(1.111,6)
Other Operating Revenues (Expenses)	187,8	7,8	-	(18.6)	177,1
Equity Pick-up	(29,4)	0,0	193,6	(193.6)	(29,4)
Depreciation and Amortization	1.834,4	97,2	-	-	1.931,6
EBITDA	3.762,7	322,3	174,3	(212.2)	4.047,1
EBITDA Margin (%)	9.6%	35.2%	n/a	n/a	10.1%
Financial income	(1.416,3)	(66,1)	(20,8)	-	(1.503,2)
Financial expense	506,1	31,1	1,8	-	539,0
Foreign exchange gain (losses), net	(533,9)	1,3	17,2	-	(515,4)
Derivatives	226,4	-	(1,4)	-	225,0
Income taxes expenses	(143.3)	(58.3)	-	-	(201.6)
Non-controlling interests	(344.8)	(28.8)	-	(114.7)	(488.3)
Results of discontinued operations	69.4	-	-	(69.4)	-
Profit (loss) for the period	292.0	104.3	171.0	(396.3)	171.0

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Results

B.1 Cosan S/A - Proforma

We present below the main highlights of Cosan S/A’s results, the Company's business unit responsible for the operations of Raízen Fuels, Raizen Energia, Comgás, Lubricants, Radar and Other Businesses.

Due to the adoption of the IFRS 11 accounting standard – Joint Arrangements, since April 2013, Cosan S/A no longer consolidates Raízen on its balance sheet, income statement and cash flows, and the result of this business unit is only reported under the “Equity Accounting Result”. Due to the relevance of Raízen on Cosan S/A’s financial information, we will report in the table below the proforma results, including Raízen’s proportional interest of 50% in the results.

For complete information on Cosan S/A results, its Earning Release is available at ri.cosan.com.br.

4T14	4Q13	COSAN S/A PROFORMA	2014	2013
(Oct-Dec)	(Oct-Dec)		(Jan-Dec)	(Jan-Dec)
10,270.2	9,183.5	Net Revenue	39,083.3	35,247.4
(9,148.5)	(8,120.4)	Cost of Goods and Services	(34,562.6)	(31,016.1)
1,121.8	1,063.1	Gross Profit	4,520.7	4,231.3
10.9%	11.6%	Gross Margin(%)	11.6%	12.%
(429.8)	(420.2)	Selling Expenses	(1,746.3)	(1,674.8)
(264.8)	(264.3)	General and Administrative Expenses	(1,004.5)	(990.2)
118.7	138.2	Other Operating Revenues (Expenses)	187.8	350.9
(6.2)	4.5	Equity Pick-up	(29.4)	(10.2)
487.3	412.2	Depreciation and Amortization	1,834.4	1,699.3
1,026.9	933.4	EBITDA	3,762.7	3,606.2
10.%	10.2%	EBITDA Margin (%)	9.6%	10.2%
(432.2)	(375.5)	Financial income	(1,416.3)	(1,248.2)
157.8	101.5	Financial expense	506.1	356.3
(349.8)	(201.5)	Foreign exchange gain (losses), net	(533.9)	(577.3)
114.1	79.1	Derivatives	226.4	213.6
6.5	182.6	Income taxes expenses	(143.3)	(195.4)
(119.5)	(114.0)	Non-controlling interests	(344.8)	(336.0)
-	36.4	Results of discontinued operations	69.4	141.5
(83.5)	229.8	Profit (loss) for the period	292.0	261.3

Raízen Combustíveis

For comparison purposes, the following information presented consider 100% of Raízen Combustíveis operations, even though Cosan S/A holds 50% share in the segment.

Raízen Combustíveis closed 2014 with growth of 7.8% of total volume sold, especially gasoline, ethanol and diesel which grew 10.0%, 11.1% and 7.9% respectively. Net revenue for the year reached R$55.7 billion, 14.8% higher than in 2013, driven by higher volumes sold and average prices, primarily by variations in petrol and diesel prices by Petrobras. EBITDA was R$2.1 billion, an 11.7% growth compared to 2013.

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Raízen Combustíveis ended 2014 with 5,356 Shell service stations and 944 convenience stores in its network, a growth of 496 stations and 94 stores compared to 2013.

Raízen Energia

For comparison purposes, the following information consider 100% of Raízen Energia operations, even though Cosan S/A holds 50% share in the segment. Additionally, it is worth mentioning that the analysis of Raizen Energia information should consider the crop year that began in April 2014 and will end in March 2015.

Raizen Energia ended 4Q14 with a crushing volume of 57.1 million tons, concluding crushing for the 2014/15 harvest with a 7.1% reduction in the total volume of sugarcane crushed. The main factor for the reduction of the volume crushed was the dry climate throughout the year, which hampered the process of planting and growth of sugarcane, reducing agricultural productivity. The product mix was more focused on sugar (54%) and ethanol (46%).

The volume of sugar and ethanol sold in 4Q14 grew 39.2% and 14.2% respectively, representing 1.3 million tons of sugar and 828,200 m³. The volume of energy sold was 7.7% lower in the quarter, compared to 4Q13, reaching 593,000 MWh. Raízen Energia’s total net revenue in 4Q14 was R$2.6 billion, 24.3% higher compared to the same period last year. EBITDA in the quarter was R$595.1 million, up 53.3%, with an EBITDA margin of 22.5%. EBITDA adjusted by the effects of biological assets was R$655.7 million.

Comgás

Comgás’ volume sold remained stable compared to 2013, with 5.5 million m³ sold in 2014. This stability is due to higher temperatures in 2014 that reduced the consumption of residential units and lowered industrial activity. Comgás’ net revenue was R$6.4 billion in 2014, 0.8% higher than 2013. EBITDA was R$1.4 billion, 7.2% higher compared to the previous year, with an EBITDA margin of 22.5%.

Lubrificantes

Net revenue from the sale of lubricants, base oil resale and other goods and services increased 3.8% in 2014, reaching R$1.6 billion. This result is due to higher average unit price and a 1.3% increase in the volume sold, which totaled 319.8 million m³. EBITDA was R$103.4 million in the year, with a margin of 6.5%.

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Radar

Radar ended 2014 with 246,700 hectares of land under its management, with a market value of R$4.6 billion. Net income in 2014 was R$157.6 million, increased by the sale of properties during the year. In 2014, EBITDA was R$193.0 million, down 15.2% compared to 2013 due to the lower valuation of the Company’s own land portfolio.

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B.2 Cosan Logística

4Q14	4Q13	COSAN LOGÍSTICA	2014	2013
(Oct-Dec)	(Oct-Dec)		(Jan-Dec)	(Jan-Dec)
255.7	206.5	Net Revenue	915.4	917.7
(177.6)	(113.0)	Cost of Goods and Services	(610.4)	(542.6)
78.1	93.5	Gross Profit	305.1	375.1
30.6%	45.3%	Gross Margin(%)	33.3%	40.9%
(24.2)	(22.6)	General and Administrative Expenses	(87.8)	(74.3)
(10.3)	(1.9)	Other Operating Revenues (Expenses)	26.4	(20.4)
(0.0)	(0.0)	Equity Pick-up	(18.6)	(0.0)
26.9	20.0	Depreciation and Amortization	97.2	77.5
70.5	89.0	EBITDA	322.3	358.0
27.6%	43.1%	EBITDA Margin (%)	35.2%	39.%
(13.8)	(11.0)	Financial income	(66.1)	(38.1)
2.5	12.6	Financial expense	31.1	50.2
0.7	0.3	Foreign exchange gain (losses), net	1.3	0.4
(11.3)	(23.8)	Income taxes expenses	(58.3)	(99.7)
(5.5)	(10.7)	Non-controlling interests	(28.8)	(48.4)
16.3	36.4	Profit (loss) for the period	104.3	144.8

Rumo

Rumo reported a record high volume of sugar loaded at the port of Santos, reaching 11.2 million tons in 2014, an increase of 21.1% over 2013. Net revenue for the year was R$915.4 million, in line with 2013. This stability was due to the drop in transportation revenue offset by the growth of the port loading revenue. Cosan Logística’s EBITDA was R$ 322.3 million in 2014, with an EBITDA margin of 35.2%.

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C. Other Items in the Consolidated Result

Financial Result

4Q14	4Q13		Financial Results	2014	2013
(Oct-Dec)	(Oct-Dec)	Chg. %	Amounts in R$ MM	(Jan-Dec)	(Jan-Dec)	Chg. %
(157.1)	(202.7)	-22.5%	Gross Debt Charges	(719.7)	(746.7)	-3.6%
41.4	31.3	32.1%	Income from Financial Investments	139.7	122.0	14.5%
(115.7)	(171.3)	-32.4%	(=) Subtotal: Net Debt Interests	(580.0)	(624.7)	-7.2%
(84.5)	(55.1)	53.4%	Other Charges and Monetary Variation	(113.3)	(86.1)	31.7%
(196.9)	(101.7)	93.6%	Exchange Rate Variation	(300.5)	(324.6)	-7.4%
110.1	90.8	21.3%	Gains (losses) with Derivatives	161.4	230.2	-29.9%
(46.8)	(17.0)	n/a	Amortization, Debt Cost and Other	(150.4)	(88.4)	70.1%
(333.8)	(254.4)	31.2%	(=) Financial, Net	(982.8)	(893.6)	10.0%

Financial result for 4Q14 was a net financial expense of R$333.8 million, versus a net debt of R$254.4 million in 4Q13, with an increase of 31.2%, mainly due to:

(i) Debt charges decreased 22.5% year-over-year mainly due to the lower indebtedness level from one period to the other, due to the corporate restructuring in 2Q14.

(ii) Increase of 32.1% on income from financial investments, due to the increase in interest rates in the period, partially offset by the reduction in average cash in the period.

(iii) The negative net result of R$86.8 million from foreign exchange rate variation and derivatives losses in the quarter reflects the valuation of the US Dollar against the Brazilian Real by 8.4% (R$2.6562/US$ on December 31, 2014 compared to R$2.4510/US$ on September 30, 2014), and its impact on debt denominated in dollars.

(iv) Amortization of debt and other costs totaled a net expense of R$46.8 million in 4Q14, mainly due to cost US $ 6.0 million from Cosan S.A. Consent expense.

The financial result for fiscal year 2014 presented net expense of R$982.8 million, while for 2013 it was R$893.6 million. This growth is mainly due to the increase of bank charges in the year, impacted by the corporate restructuring and the payment of a consent fee in the period.

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Net Income

4Q14	4Q13	Net Income	2014	2013
(Oct-Dec)	(Oct-Dec)	Amounts in R$ MM	(Jan-Dec)	(Jan-Dec)
(29.1)	132.7	Net Income	171.0	211.0

Cosan Limited’s net loss was R$29.1 million in the quarter, below the amount in 4Q13, which was R$132.7 million. However, net income during the year was R$171.0 million versus R$215.2 in the same period of 2013.

The main drivers of this change in net income during the period were:

4Q	Net Income	FY
(Oct-Dec)	Amounts in R$ MM	(Jan-Dec)
132.7	Net Income - 2013	211.0
	EBIT variation
(48.5)	Cosan Energia	(184.1)
(25.3)	Cosan Logística	(55.4)
7.0	Outros	(8.1)
-	Adjustments	(18.6)
(66.8)	EBIT Businesses Total	(266.3)
	Variation in other lines
(79.5)	Financial result	(89.3)
40.2	Equity pick-up	250.8
(173.6)	Income taxes	59.5
117.9	Non-controlling Interest	1.9
-	Discontinued operation	3.4
(29.1)	Net Income - 2014	171.0

(i)	Increase in the equity accounting result line of R$40.2 million due to Raízen’s results, outlined in previous sections, as well as the impact of foreign exchange rate variations on Raizen’s debt;

(ii)	Reduction of R$79.5 million in financial results mainly due to the foreign exchange rate variation and the results from derivatives as described in the Financial Result section;

(iii)

EBIT variation and profit of non-controlling shareholders of R$51.1 million.

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D. Loans and Financing

At the close of 4Q14, Cosan Limited’s pro forma consolidated gross debt (excluding PESA) reached R$15.5 billion, compared to R$14.1 billion, an increase of 9.3% over 3Q14.

Cosan Limited pro forma consolidated

Cash and cash equivalents totaled R$3.2 billion at the end of 4Q14 compared to R$2.4 billion in 3Q14. The pro forma net debt (including preferred) for the quarter was R$12.2 billion, compared to R$11.7 billion in 3Q14, equivalent to a leverage of 3.0x considering the pro forma EBITDA of R$4.0 billion in the last 12 months.

Debt per Business Units (Amount in R$ MM)
	4Q14	3Q14
COSAN S/A PROFORMA	(Oct-Dec)	(Jul-Sep)	Chg. %
Raízen (50%)	5,581.7	4,870.0	14.6%
Comgás	2,803.3	2,724.9	2.9%
Lubrificantes	261.2	244.6	6.8%
Other business	3,786.3	3,285.3	n/a
Total Debt Proforma	12,432.4	11,124.8	11.8%
Cash and Cash Equivalents and Securities	(3,098.6)	(2,388.2)	29.7%
Proforma Net Debt	9,333.8	8,736.6	6.8%
Preferred shareholders payable in subsidiaries	1,962.7	2,036.3	-3.6%
Proforma Net Debt (w/ preferred shareholders payable in subsidiaries)	11,296.5	10,772.9	4.9%

COSAN LOGÍSTICA
Rumo	784.7	715.7	9.6%
Total Debt	784.7	715.7	9.6%
Cash and Cash Equivalents and Securities	86.5	97.8	-11.5%
Net Debt	698.2	617.9	13.0%

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E. Stock Performance

The shares issued by Cosan Limited have been listed on NYSE – New York Stock Exchange, since its IPO in 2007, under the ticker symbol CZZ. The company has also issued share deposit certificates (Brazilian Depositary Receipts – BDR) on the BM&FBovespa under the symbol CZLT33.

The tables and graphs below represent the performance of shares issued by the companies:

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Disclaimer

This document contains forward-looking statements and estimates. These forward-looking statements and estimates are solely forecasts and do not represent any guarantee of prospective results. All stakeholders should know that these statements and estimates are and will be, depending on the case, subject to risks, uncertainties and factors related to the operations and business environment of Cosan and its subsidiaries, and therefore the actual results of these companies may significantly differ from the estimated or implied prospective results contained in such forward-looking statements and estimates.

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F. Financial Statements

F.1 Cosan Energia

Cosan Consolidated	4Q14	4Q13
Income statement for the period	12/31/2014	12/31/2013
Net operating revenue	2,041,186	2,011,255
Gross Profit	540,406	558,884
Sales, general and administrative expenses	(390,344)	(345,350)
Other operating income (expenses), net	92,460	77,490
Financial revenue	40,364	60,710
Financial expenses	(269,509)	(301,685)
Foreign exchange variation	(210,907)	(106,041)
Derivative	104,326	92,932
Equity pick up	130,036	91,478
Income and social contribution taxes	(6,649)	179,439
Equity attributable to non-controlling interests	(113,661)	(124,020)
Net Income from discontinued operations	-	48,557
Net Income (loss)	(83,478)	232,395

Cosan Consolidated	4Q14	3Q14
Balance sheet	12/31/2014	09/30/2014
Cash and cash equivalents	1,540,192	1,209,732
Securities	149,735	202,352
Accounts receivable	822,424	835,565
Inventories	347,903	321,268
Other current assets	548,134	3,516,540
Investments	8,535,180	8,687,985
Investment property	2,641,978	2,167,221
Biological assets	(0)	(0)
Property, plant and equipment	351,435	313,532
Intangible	9,426,120	9,398,821
Other non-current assets	2,740,614	2,641,710
Total Assets	27,103,712	29,294,726

Loans and financing	(7,397,601)	(6,624,781)
Suppliers	(971,170)	(881,746)
Salaries payable	(101,115)	(99,383)
Other current liabilities	(616,590)	(1,562,779)
Other non-current liabilities	(5,567,962)	(6,221,007)
Net Equity	(12,449,273)	(13,905,030)
Total Liabilities	(27,103,712)	(29,294,726)

15 of 19

Cosan Limited-Earnings Release

4th Quarter of Fiscal Year 2014

F.2 Cosan Logística

Cosan Logística	4Q14	4Q13
Income statement for the period	12/31/2014	12/31/2013
Net operating revenue	255,726	206,511
Gross profit	78,131	93,477
Sales, general and administrative expenses	(24,199)	(22,574)
Other operating income (expenses), net	(10,281)	(1,934)
Financial revenue	2,547	12,644
Financial expenses	(13,830)	(11,016)
Foreign exchange variation	740	341
Equity pick up	(0)	(0)
Income and social contribution taxes	(11,296)	(23,789)
Equity attributable to non-controlling interests	(5,530)	(10,730)
Net Income (loss)	16,280	36,418

Cosan Logística	4Q14	3Q14
Balance sheet	12/31/2014	09/30/2014
Cash and cash equivalents	86,487	97,765
Accounts receivable	42,685	36,908
Inventories	5,817	6,099
Other current assets	24,175	21,695
Investments	(0)	0
Property, plant and equipment	1,084,455	1,047,280
Intangible	860,253	834,405
Other non-current assets	481,483	406,374
Total Assets	2,585,358	2,450,526

Loans and financing	(784,709)	(715,698)
Suppliers	(141,289)	(114,947)
Salaries payable	(19,302)	(16,368)
Other current liabilities	(89,960)	(49,677)
Other non-current liabilities	(221,850)	(215,847)
Net Equity	(1,328,250)	(1,337,989)
Total Liabilities	(2,585,358)	(2,450,526)

16 of 19

Cosan Limited-Earnings Release

4th Quarter of Fiscal Year 2014

F.3 Cosan Limited (Parent company)

Cosan Limited (Parent company)	4Q14	4Q13
Income statement for the period	12/31/2014	12/31/2013
Sales, general and administrative expenses	(1,203)	(1,206)
Other operating income (expenses), net	-	(6,981)
Financial revenue	23	221
Financial expenses	(6,669)	(4,322)
Foreign exchange variation	13,257	3,997
Derivative	5,813	(2,164)
Equity pick up	(40,314)	143,165
Net Income (loss)	(29,092)	132,709

Cosan Limited (Parent company)	4Q14	3Q14
Balance sheet	12/31/2014	09/30/2014
Cash and cash equivalents	22,661	24,123
Other current assets	19,658	22,569
Investments	6,132,772	6,223,146
Other non-current assets	10,220	-
Total Assets	6,185,311	6,269,837

Loans and financing	(320,329)	(303,619)
Other current liabilities	(12,712)	(18,778)
Other non-current liabilities	(7,721)	-
Net Equity	(5,844,549)	(5,947,438)
Total Liabilities	(6,185,311)	(6,269,837)

17 of 19

Cosan Limited-Earnings Release

4th Quarter of Fiscal Year 2014

F.4 Cosan Limited

Cosan Limited	4Q14	4Q13
Income statement for the period	12/31/2014	12/31/2013
Net Operating Revenue	2,296,912	2,217,765
Gross Profit	618,537	652,361
Sales, general and administrative expenses	(415,746)	(369,130)
Other operating income (expenses), net	82,178	68,576
Financial revenue	42,935	73,574
Financial expenses	(290,008)	(317,024)
Foreign exchange variation	(196,910)	(101,704)
Derivative	110,139	90,768
Equity pick up	130,040	89,856
Income and Social Contribution Taxes	(17,945)	155,650
Equity attributable to non-controlling interests	(92,312)	(210,218)
Net Income from discontinued operations	-	(0)
Net Income (loss)	(29,092)	132,709

Cosan Limited	4Q14	3Q14
Balance sheet	12/31/2014	09/30/2014
Cash and cash equivalents	1,649,340	1,330,619
Securities	149,735	202,352
Accounts receivable	865,109	872,473
Inventories	353,720	327,367
Other current assets	547,202	1,089,081
Investments	8,535,180	8,687,859
Investment property	2,641,978	2,167,221
Property, plant and equipment	1,435,890	1,360,812
Intangible	10,286,373	10,233,226
Other non-current assets	3,231,821	3,048,084
Total Assets	29,696,348	29,319,095

Loans and financing	(8,502,640)	(7,644,098)
Suppliers	(1,112,459)	(996,693)
Salaries payable	(120,416)	(115,751)
Other current liabilities	(681,714)	(496,504)
Other non-current liabilities	(5,789,814)	(6,436,853)
Net Equity	(13,489,303)	(13,629,198)
Total Liabilities	(29,696,348)	(29,319,095)

18 of 19

Cosan Limited-Earnings Release

4th Quarter of Fiscal Year 2014

F.5 Consolidated, including Raízen

Cosan Limited Proforma	4Q14	4Q13
Income Statement for the period	12/31/2014	12/31/2013
Net Operating Revenue	10,525,966	9,389,991
Gross Profit	1,199,897	1,156,548
Sales, general and administrative expenses	(720,024)	(708,341)
Other operating income (expenses), net	108,430	129,318
Financial revenue	160,382	114,413
Financial expenses	(452,701)	(390,821)
Foreign exchange variation	(335,818)	(197,189)
Derivative	119,935	76,986
Equity pick up	(6,240)	5,446
Income and Social Contribution Taxes	(4,833)	158,768
Equity attributable to non-controlling interests	(98,120)	(212,419)
Net Income from discontinued operations	(0)	0
Net Income (loss)	(29,092)	132,709

Cosan Limited Proforma	4Q14	3Q14
Balance Sheet	12/31/2014	09/30/2014
Cash and cash equivalents	3,058,050	2,209,986
Securities	149,735	202,352
Accounts receivable	2,007,869	1,888,490
Inventories	2,076,059	2,137,958
Other current assets	1,246,121	1,823,292
Investments	338,800	330,152
Investment property	2,641,978	2,167,221
Biological assets	914,152	914,414
Property, plant and equipment	7,584,036	7,515,186
Intangible	14,064,484	14,027,265
Other non-current assets	4,825,854	4,288,228
Total Assets	38,907,140	37,504,545

Loans and Financing	(14,470,324)	(12,895,998)
Suppliers	(1,695,764)	(1,561,504)
Salaries Payable	(279,925)	(308,224)
Other current liabilities	(1,369,292)	(881,747)
Other non-current liabilities	(7,531,602)	(8,162,749)
Net Equity	(13,560,232)	(13,694,323)
Total Liabilities	(38,907,140)	(37,504,545)

19 of 19

Item 2

Cosan Limited

Consolidated financial statements at

December 31, 2014 and report of independent

registered public accounting firm

Cosan Limited

Consolidated financial statements

December 31, 2014

Contents

Report of independent registered public accounting firm	3

Consolidated statement of financial position	5

Consolidated statement of profit or loss and other comprehensive income	7

Statement of changes in shareholders’ equity	9

Consolidated statement of cash flows	12

Notes to the consolidated financial statements	14

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders

Cosan Limited

In our opinion, the accompanying consolidated statement of financial position and the related consolidated statements of profit or loss and other comprehensive income, of changes in shareholders’ equity and of cash flows present fairly, in all material respects, the financial position of Cosan Limited and its subsidiaries at December 31, 2014 and 2013, and the results of their operations and their cash flows for the year ended December 31, 2014, nine month-period ended December 31, 2013 and for the year ended March 31, 2013 in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2014, based on criteria established in Internal Control - Integrated Framework 2013 issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for these financial statements, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in “Management’s report on internal control over financial reporting”. Our responsibility is to express opinions on these financial statements and on the Company's internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting 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 audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

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 (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) 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 (iii) 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.

Campinas, Brazil

March 18, 2015

/s/ PricewaterhouseCoopers

PricewaterhouseCoopers

Auditores Independentes

Cosan Limited

Consolidated statement of financial position

(In thousands of Brazilian Reais - R$)

	Note		December 31, 2014		December 31, 2013
Assets
Cash and cash equivalents		6		1,649,340		1,509,565
Investment securities				149,735		87,978
Trade receivables		7		865,109		844,483
Derivative financial instruments		31		30,069		-
Inventories		8		353,720		311,980
Receivables from related parties		11		38,357		46,788
Income tax receivable				94,100		56,340
Other current tax receivable		9		78,818		85,433
Other financial assets		10		69,683		63,054
Dividends receivable				36,130		26,350
Other				174,957		217,927
				3,540,018		3,249,898

Assets held for sale		14		25,089		314,104

Total current assets				3,565,107		3,564,002

Trade receivables		7		480,992		238,460
Deferred tax assets		20		214,164		232,188
Receivables from related parties		11		212,527		504,481
Income tax receivable				8,778		49,268
Taxes recoverable		9		17,299		18,366
Judicial deposits		21		418,385		361,554
Other financial assets		10		370,497		407,107
Derivative financial instruments		31		860,509		513,934
Other non-current assets				648,669		493,340
Investment in associates		12		130,677		103,316
Investment in joint ventures		13		8,404,503		8,498,259
Investment properties		14		2,641,978		2,281,509
Property, plant and equipment		15		1,435,890		1,271,910
Intangible assets and goodwill		16		10,286,373		10,078,040

Total non-current assets				26,131,241		25,051,732

Total assets				29,696,348		28,615,734

Cosan Limited

Consolidated statement of financial position

(In thousands of Brazilian Reais - R$)

	Note		December 31, 2014			December 31, 2013
Liabilities
Loans and borrowings		17		1,056,353			1,050,862
Derivative financial instruments		31		13,803			50,879
Trade payables		18		1,112,459			862,429
Employee benefits payable				120,416			103,296
Income tax payable				30,905			28,143
Other taxes payable		19		307,741			199,056
Dividends payable				33,354			92,759
Payables to related parties		11		137,441			105,463
Other				158,471			157,806

Total current liabilities				2,970,943			2,650,693

Loans and borrowings		17		7,446,287			8,042,094
Derivative financial instruments		31		319,632			280,462
Other taxes payable		19		334,565			1,010,767
Provision for legal proceedings		21		657,779			722,458
Pension and post-employment benefits		33		301,850			339,135
Deferred tax liabilities		20		1,739,274			1,698,622
Preferred shareholders payable in subsidiaries		22		1,926,888			-
Other				509,823			551,739

Total non-current liabilities				13,236,098			12,645,277

Total liabilities				16,207,041			15,295,970

Shareholders' equity
Share capital				5,328			5,328
Additional paid in capital				3,887,109			3,828,858
Other comprehensive loss				(165,618	)		(84,887	)
Retained earnings				2,117,739			2,136,975
Equity attributable to owners of the parent				5,844,558			5,886,274
Non-controlling interests		12		7,644,749			7,433,490

Total shareholders' equity				13,489,307			13,319,764

Total shareholders' equity and liabilities				29,696,348			28,615,734

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

Cosan Limited

Consolidated statement of profit or loss and other comprehensive income

(In thousands of Brazilian Reais – R$, except earnings per share)

	Note		Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013
Net sales		26		9,062,304			6,878,214			4,586,209
Cost of sales		27		(6,413,720	)		(4,878,229	)		(3,211,309	)

Gross profit				2,648,584			1,999,985			1,374,900

Selling expenses		27		(881,543	)		(603,965	)		(459,433	)
General and administrative expenses		27		(668,613	)		(466,933	)		(419,533	)
Other income (expense), net		29		(21,240	)		76,272			173,739

Operating expense				(1,571,396	)		(994,626	)		(705,227	)

Income before financial results,
equity in earnings in and income taxes				1,077,188			1,005,359			669,673

Equity in earnings of investees
Equity in earnings of associates		12		3,540			5,497			70,414
Equity in earnings of joint ventures		13		588,428			242,036			603,912
				591,968			247,533			674,326
Financial results		28
Finance expense				(1,060,802	)		(804,606	)		(578,005	)
Finance income				217,112			179,904			163,663
Foreign exchange losses, net				(300,521	)		(324,495	)		(83,254	)
Derivatives				161,363			235,485			74,483
				(982,848	)		(713,712	)		(423,113	)

Profit before taxes				686,308			539,180			920,886

Income tax (expense) benefit		20
Current				(156,502	)		(129,976	)		(100,049	)
Deferred				112,673			90,782			(26,304	)
				(43,829	)		(39,194	)		(126,353	)

Cosan Limited

Consolidated statement of profit or loss and other comprehensive income

(In thousands of Brazilian Reais – R$, except earnings per share)

Profit from continuing operations			642,479			499,986			794,533
Profit from discontinued operations, net of tax			-			-			138,918

Profit for the period			642,479			499,986			933,451

Other comprehensive income
Items that will not be reclassified to profit or loss:
Actuarial gain (loss) on defined benefit plan			46,988			42,438			(52,253	)
Taxes on items that will not
be reclassified to profit or loss			(15,976	)		(14,429	)		17,766
			31,012			28,009			(34,487	)




Items that may be reclassified to profit or loss:
Foreign currency translation effect			(75,408	)		(42,891	)		2,583
Gain (loss) on cash flow hedge in joint ventures and
subsidiary			(53,958	)		(6,426	)		35,695
Revaluation of investment properties			-			-			83,318
Changes in fair value of
available for sale securities			9,110			13,753			10,806
Taxes on items that may be
reclassified to profit or loss			(3,097	)		(4,676	)		103,743
			(123,353	)		(40,240	)		236,145

Total other comprehensive income (loss), net of tax			(92,341	)		(12,231	)		201,658

Total comprehensive income			550,138			487,755			1,135,109

Net income attributable to:
Owners of the Parent (including
discontinued operations)			171,006			122,618			424,070
Non-controlling interests			471,473			377,368			509,381

Total comprehensive income attributable to:
Owners of the Parent			90,275			96,639			541,662
Non-controlling interests			459,863			391,116			593,447

Basic earnings per share	24
Continuing operations		R$	0.65		R$	0.46		R$	1.27
Discontinued operations			-			-		R$	0.33
		R$	0.65		R$	0.46		R$	1.60
Diluted earnings per share	24
Continuing operations (as revised - Note 24)		R$	0.58		R$	0.40		R$	1.21
Discontinued operations			-			-		R$	0.33
		R$	0.58		R$	0.40		R$	1.54

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

Cosan Limited

Statement of changes in shareholders’ equity

(In thousands of Brazilian Reais - R$)

			Capital reserve
			Additional			Other						Equity attributable			Non-
	Share		paid in			comprehensive			Retained			to owners			controlling			Total
	capital		capital			income			earnings			of the parent			interests			equity
At April 1, 2012		5,328		3,811,808			(176,500	)		1,923,638			5,564,274			3,862,281			9,426,555

Profit for the year		-		-			-			424,070			424,070			509,381			933,451

Other comprehensive income
Foreign currency translation effects		-		-			(3,381	)		-			(3,381	)		5,964			2,583
Gain on cash flow hedge in joint ventures		-		-			22,239			-			22,239			13,456			35,695
Revaluation of investment property		-		-			118,832			-			118,832			71,903			190,735
Actuarial loss on defined benefit plan		-		-			(21,486	)		-			(21,486	)		(13,001	)		(34,487	)
Changes in fair value of
available for sale Securities		-		-			1,388			-			1,388			5,744			7,132

Total comprehensive income for the year		-		-			117,592			424,070			541,662			593,447			1,135,109

Contributions by and distributions to
owners of the Parent
Share options exercised - Subsidiaries		-		10,444			-			-			10,444			6,320			16,764
Dividends - non-controlling interests		-		(1,295	)		-			-			(1,295	)		1,316			21
Share based compensation - Subsidiaries		-		8,284			-			-			8,284			5,012			13,296
Dividends		-		-			-			(153,657	)		(153,657	)		(315,259	)		(468,916	)

Total contributions by and distributions to
owners of the Parent		-		17,433			-			(153,657	)		(136,224	)		(302,611	)		(438,835	)

Transactions with owners of the Parent
Corporate reorganization - Raízen Group		-		31,693			-			-			31,693			19,173			50,866
Acquisition of treasury shares		-		(17,250	)		-			-			(17,250	)		-			(17,250	)
Acquisition of non-controlling interest		-		(2,859	)		-			-			(2,859	)		(79,641	)		(82,500	)
Business combination COMGÁS		-		15,754			-			-			15,754			1,863,331			1,879,085
Business combination Radar		-		270			-			-			270			1,285,593			1,285,863
Business combination Logispot
non-controlling interest		-		-			-			-			-			(32,872	)		(32,872	)

Total transactions with owners of the Parent		-		27,608			-			-			27,608			3,055,584			3,083,192

At March 31, 2013		5,328		3,856,849			(58,908	)		2,194,051			5,997,320			7,208,701			13,206,021

Cosan Limited

Statement of changes in shareholders’ equity

(In thousands of Brazilian Reais - R$)

			Capital reserve
			Additional			Other						Equity attributable			Non-
	Share		paid in			comprehensive			Retained			to owners			controlling			Total
	capital		capital			income			earnings			of the parent			interests			equity
At April 1, 2013		5,328		3,856,849			(58,908	)		2,194,051			5,997,320			7,208,701			13,206,021

Profit for the nine-month period		-		-			-			122,618			122,618			377,368			499,986

Other comprehensive income
Foreign currency translation effects		-		-			(34,984	)		-			(34,984	)		(7,907	)		(42,891	)
Loss on cash flow hedge in joint ventures		-		-			(4,004	)		-			(4,004	)		(2,422	)		(6,426	)
Actuarial gain on defined benefit plan		-		-			11,334			-			11,334			16,675			28,009
Changes in fair value of
available for sale Securities		-		-			1,675			-			1,675			7,402			9,077

Total comprehensive income for the nine months		-		-			(25,979	)		122,618			96,639			391,116			487,755

Contributions by and distributions to
owners of the Parent
Share options exercised - Subsidiaries		-		10,120			-			-			10,120			6,123			16,243
Dividends - non-controlling interests		-		889			-			-			889			(589	)		300
Share based compensation - Subsidiaries		-		4,109			-			-			4,109			2,486			6,595
Dividends		-		-			-			(179,694	)		(179,694	)		(148,586	)		(328,280	)

Total contributions by and distributions to
owners of the Parent		-		15,118			-			(179,694	)		(164,576	)		(140,566	)		(305,142	)

Transactions with owners of the Parent
Acquisition of treasury shares		-		(43,412	)		-			-			(43,412	)		(26,268	)		(69,680	)
Unclaimed dividends		-		303			-			-			303			507			810

Total transactions with owners of the Parent		-		(43,109	)		-			-			(43,109	)		(25,761	)		(68,870	)

At December 31, 2013		5,328		3,828,858			(84,887	)		2,136,975			5,886,274			7,433,490			13,319,764

Cosan Limited

Statement of changes in shareholders’ equity

(In thousands of Brazilian Reais - R$)

			Capital reserve
			Additional		Other						Equity attributable			Non-
	Share		paid in		comprehensive			Retained			to owners			controlling			Total
	capital		capital		income			earnings			of the parent			interests			equity
At January 1, 2014		5,328		3,828,858		(84,887	)		2,136,975			5,886,274			7,433,490			13,319,764

Profit for the year		-		-		-			171,006			171,006			471,473			642,479

Other comprehensive income
Foreign currency translation effects		-		-		(66,653	)		-			(66,653	)		(8,755	)		(75,408	)
Loss on cash flow hedge in joint ventures and subsidiary		-		-		(33,687	)		-			(33,687	)		(20,271	)		(53,958	)
Actuarial gain on defined benefit plan		-		-		18,285			-			18,285			12,727			31,012
Changes in fair value of
available for sale Securities		-		-		1,324			-			1,324			4,689			6,013

Total comprehensive income for the year		-		-		(80,731	)		171,006			90,275			459,863			550,138

Contributions by and distributions to
owners of the Parent
Share options exercised - Subsidiaries		-		28,436		-			-			28,436			17,111			45,547
Dividends - non-controlling interests		-		3,411		-			-			3,411			857			4,268
Share based compensation - Subsidiaries		-		8,073		-			-			8,073			4,851			12,924
Dividends		-		-		-			(190,242	)		(190,242	)		(255,293	)		(445,535	)

Total contributions by and distributions to
owners of the Parent		-		39,920		-			(190,242	)		(150,322	)		(232,474	)		(382,796	)

Transactions with owners of the Parent
Acquisition of non-controlling interest		-		18,331		-			-			18,331			(16,130	)		2,201

Total transactions with owners of the Parent		-		18,331		-			-			18,331			(16,130	)		2,201

At December 31, 2014		5,328		3,887,109		(165,618	)		2,117,739			5,844,559			7,644,749			13,489,307

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

Cosan Limited

Consolidated statement of cash flows

(In thousands of Brazilian Reais - R$)

	Note		Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013
Cash flows from operating activities
Profit before taxes				686,308			539,180			920,886
Adjustments for:
Depreciation and amortization		15 / 16		679,101			439,144			334,786
Equity in earnings of associates		12		(3,540	)		(5,497	)		(70,414	)
Equity in earnings of joint ventures		13		(588,428	)		(242,036	)		(603,912	)
(Gain) loss on disposal of assets				9,958			6,922			(100,349	)
Share-based compensation expense		11 / 34		12,924			6,595			13,295
Change in fair value of investment property		14 / 29		(131,697	)		(121,543	)		(138,776	)
Provisions for legal proceedings				51,347			80,944			49,334
Indexation charges, interest and
exchange gains/losses, net				1,086,158			825,774			438,361
Other				42,557			40,167			67,440
				1,844,688			1,569,650			910,651
Changes in:
Restricted cash				-			18,220			-
Cash from discontinued operations				-			-			116,387
Trade receivables				(268,813	)		(254,236	)		(62,414	)
Securities				(98,714	)		-			(14,276	)
Inventories				(40,321	)		(28,324	)		(33,355	)
Recoverable taxes				51,013			(13,167	)		(28,488	)
Related parties				(112,251	)		(8,519	)		(104,078	)
Advances to suppliers				1,544			4,954			15,269
Trade payables				241,827			55,728			(5,280	)
Employee benefits				(58,098	)		(14,216	)		(55,194	)
Provisions for legal proceedings				(50,136	)		(107,484	)		(9,212	)
Income and other taxes				(458,979	)		(156,476	)		(313,702	)
Other				65,390			82,340			(133,193	)
				(727,538	)		(421,180	)		(627,536	)

Net cash generated by operating activities				1,117,150			1,148,470			283,115

Cash flows from investing activities
Acquisitions in associates, net of cash acquired				-			-			(2,995,499	)
Capital contribution in associates				(46,259	)		(79,594	)		(61,014	)
Dividends received from associates				3,118			3,684			-
Dividends received from joint ventures				705,072			406,424			578,757
Acquisition of property, plant and
equipment and intangible assets		15 / 16		(1,063,412	)		(976,119	)		(649,681	)
Proceeds from sale of property, plant
and equipment, intangibles and investments				1,196			65,350			220,719
Proceeds from sale of discontinued operation		30		68,633			57,175			196,546
Net cash used by discontinued operation				-			-			(411	)

Net cash used in investing activities				(331,652	)		(523,080	)		(2,710,583	)

Cosan Limited

Consolidated statement of cash flows

(In thousands of Brazilian Reais - R$)

Cash flows from financing activities
Loans and borrowings raised		1,720,385		1,072,339		6,197,855
Payment of principal and interest on
loans and borrowings		(3,631,292	)	(1,460,470	)	(2,787,121	)
Related parties		(1,643	)	-		-
Acquisition of non-controlling interest		-		-		(82,500	)
Derivative financial instruments		(84,951	)	82,621		-
Share capital paid in preferred shares	22	1,946,736		-		-
Dividends paid		(630,233	)	(314,446	)	(396,462	)
Treasury shares		-		(69,659	)	(17,250	)
Proceeds from exercise of share options		45,547		16,243		16,764

Net cash (used in) generated by financing activities		(635,451	)	(673,372	)	2,931,286

Increase (decrease) in cash and cash equivalents		150,047		(47,982	)	503,818

Cash and cash equivalents at beginning of period		1,509,565		1,544,072		1,036,217
Effects of exchange rate changes on cash held		(10,272	)	13,475		4,037

Cash and cash equivalents at ended of period		1,649,340		1,509,565		1,544,072

Supplemental cash flow information
Interest paid		725,309		376,526		166,068
Income taxes paid		157,285		129,539		224,640

Non-cash transactions
Offset of tax loss carryforwards - REFIS (Note 19)		173,559		-		-
Offset of transaction with joint ventures - REFIS (Note 19)		231,168		-		-

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

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

1	Operations

Cosan Limited (“Cosan”) was incorporated in Bermuda on April 30, 2007. Cosan’s class A common shares are traded on the New York Stock Exchange (NYSE) (ticker - CZZ). The BDRs (Brazilian Depositary Receipts) representing Cosan’s class A common shares are listed on the Brazilian Stock Exchange (BM&FBovespa) (ticker - CZLT33). Mr. Rubens Ometto Silveira Mello is the ultimate controlling shareholder of Cosan. Cosan controls its subsidiaries Cosan S.A. Indústria e Comércio (“Cosan S.A.”), Cosan Logística S.A. (“Cosan Log”) through a 62.51 % interest. Cosan, Cosan S.A., Cosan Log and its subsidiaries are collectively referred to as the “Company”.

The Company’s primary activities are in the following business segments: (i) Piped natural gas distribution to part of the State of São Paulo through its subsidiary Companhia de Gás de São Paulo – COMGÁS (“COMGÁS”), which has been consolidated since November 2012; (ii) Logistics services including transportation, port loading and storage of sugar, through its indirect subsidiary Rumo Logística Operadora Multimodal S.A. (“Rumo”); (iii) Purchase, sale and leasing of agricultural land through its subsidiary, Radar Propriedades Agrícolas S.A. ("Radar"); (iv) Production and distribution of lubricants under the Mobil licensed trademark in Brazil, Bolivia, Uruguay and Paraguay, in addition to the European and Asian market using the Comma brand and corporate activities; and (v) other investments, in addition to the corporate structures of the Company (“Cosan’s other business”).

The Company also holds interests in two joint ventures ("JVs"): (i) Raízen Combustíveis S.A. (“Raízen Combustíveis”), a fuel distribution business, and (ii) Raízen Energia S.A. (“Raízen Energia”), which operates in the production and marketing of sugar, ethanol and energy cogeneration, produced from sugar cane bagasse. Cosan and Royal Dutch Shell (“Shell”) share control of the two entities, where each owns 50% of the economic control. Up until the adoption of IFRS11 – Joint Arrangements (“IFRS 11”), these investments were accounted for using the proportional consolidation method. Upon the adoption of IFRS 11, during the nine months ended December 31, 2013, these investments have been accounted for under the equity method (all comparative periods was adjusted to conform to IFRS 11 presentation).

The Annual General Shareholders' Meeting held on July 31, 2013, approved a fiscal year end change from March 31st to December 31st. This was driven by changes in the Company’s investment portfolio, in which other businesses that do not use the harvest year (March 31) have become more significant. With this change, the Company’s fiscal year begins on January 1st, and ends on December 31st of each year. Accordingly, these consolidated financial statements are presented for the year ended December 31, 2014, the nine months ended December 31 (transition period) and for the year ended March 31, 2013.

On October 1, 2014 at the Extraordinary General Meeting (EGM), the Cosan S.A. shareholders’ approved the partial spin-off (the “Partial Spin-off”) of Cosan S.A. and merger of the spun-off portion into Cosan Log, composed of Cosan’s logistics operations. The Partial Spin-off seeks to segregate the Cosan S.A.’s activities in order to allow each business segment to focus on its sector, establishing suitable capital structures for each company. It also seeks to provide the market with greater transparency on each company’s performance, which will allow a better evaluation from shareholders and investors of the individual businesses permitting that resources be allocated accordance to the shareholder’s interests and investment strategy.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

2	Basis of preparation

2.1 Statement of compliance

The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

These consolidated financial statements were authorized for issue by the Board of Directors on March 6, 2015.

2.2 Basis of measurement

The consolidated financial statements have been prepared on the historical cost basis except for the following material items in the statement of financial position:

Derivative financial instruments are measured at fair value;

Non-derivative financial instruments at fair value through profit or loss are measured at fair value;

Available-for-sale financial assets are measured at fair value;

Investment property is measured at fair value; and

Employees’ defined benefit obligations are presented at the present value of the actuarial obligation net of the fair value of plan assets (Note 33).

2.3 Functional and presentation currency

The consolidated financial statements are presented in Brazilian Reais. However, the functional currency of Cosan Limited is the U.S. Dollar (US$). The Brazilian Real is the functional currency of Cosan S.A., Cosan Log, its subsidiaries and joint ventures, located in Brazil, as it is the currency of the primary economic environment in which they operate, generate and expend cash. The functional currency for the subsidiaries located outside Brazil is U.S. Dollar or the Pound Sterling.

2.4 Use of estimates and judgments

The preparation of the consolidated financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenue and expenses at the end of the reporting period. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

Information about critical judgments in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements is included in the following notes:

Notes 15 and 16 – Property, plant and equipment and intangible assets

The calculation of amortization and depreciation of intangible assets and property, plant and equipment is based on estimated useful lives. In addition, the determination of the fair value

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

of intangible assets and property, plant and equipment acquired in a business combination or arising from the formation of a JV is a significant estimate.

The Company performs annually a review of impairment indicators for intangible assets and property, plant and equipment. Also, an impairment test is undertaken for goodwill. Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount, which is the higher of its fair value less costs to sell and its value in use. The key assumptions used to determine the recoverable amount of the different cash generating units to which goodwill is allocated are explained in Note 16.

COMGÁS has an agreement for the public concession of gas distribution service in accordance to which the Conceding Authority, at the end of the concession, will hold a significant portion of the infrastructure and controls what services must be rendered and what prices will be applied. This concession agreement represents the right to charge from customers for the supply of gas during the effective period of the agreement. Therefore, the Company recognizes this right as intangible assets.

The amortization of intangible assets reflects the pattern expected for the utilization of the future economic benefits by the Company, which corresponds to the useful lives of the assets comprising the infrastructure consonant to the ARSESP provisions, as disclosed in Note 16.

The amortization of the intangible assets is discontinued when the related asset is fully used or written-off, and no longer is included in the calculation basis of the tariff for the rendering of the concession services, whichever occurs first.

The Company may request only once the extension of the distribution services for another 20 years, being subject to evaluation by the Conceding Authority. When the concession is terminated, the assets linked to the rendering of gas distribution services will be returned to the Conceding Authority, and the Company will be entitled to receive an indemnity to be determined based on assessments and evaluations considering the book values to be calculated at the time

Note 20 – Income taxes and social contribution

A deferred tax asset is recognized for loss carryforwards to the extent that it is probable that future taxable income will be generated to realize such losses. Significant judgment is required to determine the amount of deferred tax assets that can be recognized, based upon the timing and the level of future taxable income together with future tax planning strategies.

Other non-current asset

The Company has recognized a receivable in relation to a lawsuit filed against the Federal Government, claiming indemnification due to price controls, for which receipt is virtually certain, as the Supreme Court has passed final judgment against which the Federal Government has no recourse to appeal (Note 21).

Information about assumptions and estimation uncertainties that have a significant risk of material adjustment are as follows:

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Note 7 – Trade receivables

Estimate of realization of receivable from contract under arbitration:

The Company’s subsidiaries Rumo is a defendant in a legal action initiated by América Latina Logística S.A. (“ALL”), a provider of rail transport services and lessee of Rumo’s rolling stock, in relation to the investment and transportation contracts entered into in 2009 (Note 7). The Company had requested arbitration to enforce its contractual rights and for ALL to comply with the terms of the agreements. Rail transport services continue to be provided by ALL.

On April 1, 2014, the Board of Directors of ALL accepted an offer by the Company to merger ALL’s activities with Rumo’s through the merger of shares issued by ALL into Rumo (“Stock Merger”). Accordingly, the current shareholders’ of Rumo and ALL will receive shares representing 36.5% and 63.5% of the capital stock of the merged company, respectively.

On May 12, 2014, Rumo and ALL officially suspended the arbitration and all court proceedings related to the performance of the agreements entered in 2009 (Note 7).

The amounts recorded as revenue and as a receivable are for the services provided under the terms of the contract, and represent management’s best estimate of the inflow of economic benefit, and backed by guarantees provided by ALL. However, the final settlement may be for an amount that is higher or lower than the amounts recorded in the financial statements as trade receivables.

Note 31 – Fair value of derivatives and other financial instruments

When the fair value of financial assets and liabilities cannot be derived from active markets, their fair value is determined using valuation techniques including the discounted cash flow model. The inputs to these models are taken from observable markets where possible, but when this is not feasible, a degree of judgment is required in determining fair values. Judgment is required in the determination of inputs such as liquidity risk, credit risk and volatility. Changes in these variables could affect the reported fair value of financial instruments.

Note 33 – Pension and other post-employment benefit plans

The cost of defined benefit pension plans and other post-employment and the present value of the pension obligation is determined using actuarial valuations. An actuarial valuation involves the use of various assumptions which may differ from actual results in the future. These include the determination of the discount rate, future salary increases, mortality rates and future pension increases. A defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed by management at each reporting date.

Note 34 – Share based payments

Cosan S.A. measures employees’ share based compensation cost by reference to the fair value of the shares at the grant date. The estimation of fair value for share-based payment

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

transactions requires determining the most appropriate valuation model, which is dependent on the terms and conditions of the plan. This estimate also requires determining the most appropriate inputs to the valuation model including the assumption of the expected life of the stock option, volatility and dividend yield. The assumptions and models used for estimating fair value for share-based payment transactions are disclosed in Note 34.

Note 21 – Provisions for legal proceedings

Provisions for legal proceedings are recognized when: the group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions for legal proceedings resulting from business combinations are estimated at fair value.

3	Significant accounting policies

The accounting policies set out below have been applied consistently by the Company to all periods presented.

3.1 Basis of consolidation

The consolidated financial statements include the accounts of Cosan and its subsidiaries. Cosan’s subsidiaries are listed below:

	Ownership percentage
	December 31, 2014		December 31, 2013
	December 31, 2014		December 31, 2013
Directly owned subsidiaries
_Cosan S.A.		62.51		62.30
Cosan Logística S.A.(i)		62.51		-


Interest of Cosan S.A. in its subsidiaries
Administração de Participações Aguassanta Ltda.(ii)		-		65.00
Águas da Ponte Alta S.A.		65.00		65.00
Bioinvestments Negócios e Participações S.A.		65.00		65.00
Comma Oil Chemicals		100.00		100.00
Companhia de Gás de São Paulo – COMGÁS		60.69		60.05
Cosan Biomassa S.A.		100.00		100.00
Cosan Cayman II Limited		100.00		100.00
Cosan Global Limited		100.00		100.00
Cosan Investimentos e Participações S.A.		100.00		100.00
Cosan Logística S.A.(i)		-		100.00
Cosan Lubes Investments Limited		100.00		100.00
Cosan Lubrificantes e Especialidades S.A.		100.00		100.00
Cosan Luxembourg S.A.		100.00		100.00
Cosan Overseas Limited		100.00		100.00
Cosan Paraguay S.A.		100.00		100.00
Cosan US, Inc.		100.00		100.00
Logispot Armazéns Gerais S.A.(i)		-		38.25
Nova Agrícola Ponte Alta S.A.		29.50		29.50
Nova Amaralina S.A. Propriedades Agrícolas		29.50		29.50
Nova Santa Barbara Agrícola S.A.		29.50		29.50
Pasadena Empreendimentos e Participações S.A.		100.00		100.00
Proud Participações S.A.		65.00		65.00
Radar II Propriedades Agrícolas S.A.		65.00		65.00
Radar Propriedades Agrícolas S.A.		29.50		29.50
Rumo Logística Operadora Multimodal S.A.(i)		-		75.00
Terras da Ponte Alta S.A.		29.50		29.50
Vale da Ponte Alta S.A.		65.00		65.00

Interest of Cosan
Logística S.A. in its subsidiaries
Logispot Armazéns Gerais S.A.(i)		38.25		-
Rumo Logística Operadora Multimodal S.A.(i)		75.00		-

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

(i)

Logispot Armazéns Gerais S.A. and Rumo Logística Operadora Multimodal S.A. are directly owned subsidiaries of Cosan Logística S.A., which become a directly owned subsidiary of Cosan Limited in 2014, as described in Note 1;

(ii)

Incorporated in March 2014.

Business combinations – IFRS 3 (R)

Business combinations are accounted for using the acquisition method – i.e. when control is transferred to the Company. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, the Company takes into consideration potential voting rights that are currently exercisable.

The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the Company. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognized in profit or loss. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Any contingent consideration to be transferred by the Company is recognized at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognized in accordance with IAS 39 either in profit or loss or in other comprehensive income. Contingent consideration that is classified as equity is not re-measured, and its subsequent settlement is accounted for within equity.

If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is re-measured to fair value at the acquisition date; any gains or losses arising from such re-measurement are recognized in profit or loss.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Goodwill is initially measured as the excess of the aggregate of the consideration transferred and the fair value of non-controlling interest over the net identifiable assets acquired and liabilities assumed. If this consideration is lower than the fair value of the net assets of the subsidiary acquired, the difference is recognized in profit or loss as a bargain purchase gain.

Transactions costs, other than those associated with the issue of debt or equity securities, that the Company incurs in connection with a business combination are expensed as incurred.

Non-controlling interests

For each business combination, the Company elects to measure any non-controlling interests in the acquiree either:

at fair value; or

at their proportionate share of the acquiree’s identifiable net assets, which are generally at fair value.

Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions – that is, as transactions with the owners in their capacity as owners.

Subsidiaries

Subsidiaries are all entities (including structured entities) over which the Company has control. The Company controls an entity when is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

Subsidiaries are fully consolidated from the date of acquisition of control, and continue to be consolidated until the date that control ceases to exist. They are deconsolidated from the date that control ceases.

The financial statements of subsidiaries are prepared for the same reporting period as that of the parent company, using consistent accounting policies.

Investments in associates (equity method investees)

Associates are those entities in which the Company has significant influence, but not control or joint control, over the financial and operating policies. Significant influence is presumed to exist when the Company holds between 20% and 50% of the voting power of another entity.

Investments in associates are accounted for under the equity method and are recognized initially at cost. The cost of the investment includes transaction costs.

The financial statements include the Company’s share of the profit or loss and other comprehensive income of equity method investees, after adjustments to align the accounting policies with those of the Company.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

When the Company’s share of losses exceeds its interest in an equity method investee, the carrying amount of the investment, including any long-term interests that form part thereof, is reduced to zero, and the recognition of further losses is discontinued except to the extent that the Company has an obligation or has made payments on behalf of the investee.

Investments in joint ventures (equity method investees)

The Company has interests in joint ventures, in which contractual arrangement establishes joint control over the voting and economic activities of the entity. The contractual arrangements require unanimous agreement for financial and operating decisions among the ventures. The Company recognizes its interest in the joint ventures using the equity method (Note 13).

Transactions eliminated on consolidation

Intra-group balances and transactions, and any unrealized income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.

Unrealized gains arising from transactions with equity accounted investees are eliminated against the investment to the extent of the Company’s interest in the investee. Unrealized losses are similarly eliminated, but only to the extent that there is no evidence of impairment.

3.2 Foreign currency

Foreign currency transactions

Transactions in foreign currencies are translated to the respective functional currencies of the each subsidiary using the exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional currency using the exchange rate at the reporting date.

Translation differences on non-monetary assets and liabilities held at fair value through profit or loss are recognized in profit or loss as part of the fair value gain or loss. Non-monetary items that are measured based on historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

Foreign currency translation effects are generally recognized in profit or loss. However, foreign currency translation effects arising from the translation of the following items are recognized in other comprehensive income:

available-for-sale equity investments (except an impairment is recognized in which case foreign currency differences that have been recognized in other comprehensive income are reclassified to profit or loss); or

qualifying cash flow hedges to the extent the hedge is effective.

Foreign operations

The assets and liabilities derived from foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated to Brazilian Reais using the exchange rates

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

at the reporting date. Income and expenses of foreign operations are translated to Brazilian Reais using the exchange rates at the dates of the transactions.

Foreign currency differences are recognized in other comprehensive income, and presented in the foreign currency translation reserve (translation reserve) in equity. However, if the foreign operation is a non-wholly owned subsidiary, then the relevant proportion of the translation difference is allocated to non-controlling interests. When a foreign operation is disposed of such that control, significant influence or joint control is lost, the cumulative amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part of the gain or loss on disposal. When the Company disposes of only part of its interest in a subsidiary that includes a foreign operation while retaining control, the relevant proportion of the cumulative amount is reattributed to non-controlling interests.

Translation of subsidiaries and associates’ financial statements

These consolidated financial statements have been translated to the Brazilian Real using the following criteria:

assets and liabilities have been translated using the exchange rate at the balance sheet date;

statement of profit or loss, comprehensive income and statement of cash flows have been translated using the monthly average exchange rate; and

shareholders' equity has been translated using the historical exchange rate.

Translation effects have been recognized in shareholders' equity in "Cumulative translation adjustment".

The consolidated financial statements of each subsidiary included in these consolidated financial statements and equity method investments are prepared based on their respective functional currencies. For subsidiaries whose functional currency is a currency other than the Brazilian Real, asset and liability accounts are translated into the Company’s reporting currency using exchange rates in effect at the date of the statement of financial position, and income and expense items are translated using monthly average exchange rates and shareholders’ equity has been translated using the historical exchange rate. The resulting translation adjustments are reported in a separate component of shareholders’ equity, as cumulative translation adjustment.

The exchange rate of the Brazilian Real (R$) to the U.S. Dollar (US$) was R$ 2.6562 at December 31, 2014, R$ 2.3426 at December 31, 2013 and R$ 2.0138 at March 31, 2013.

3.3 Financial instruments

Non-derivative financial assets

The Company initially recognizes loans and receivables on the date that they are originated. All other financial assets (including assets designated as at fair value through profit or loss) are recognized initially on the trade date, which is the date that the Company becomes a party to the contractual provisions of the instrument.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

The Company derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred. Any interest in such transferred financial assets that is created or retained by the Company is recognized as a separate asset or liability.

Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Company has a legal right to offset the amounts and intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously.

The Company classifies non-derivative financial assets into the following categories: financial assets at fair value through profit or loss, held-to-maturity financial assets, loans and receivables and available-for-sale financial assets.

Financial assets at fair value through profit or loss

A financial asset is classified at fair value through profit or loss if it is classified as held-for trading or is designated as such on initial recognition. Financial assets are designated at fair value through profit or loss if the Company manages such investments and makes purchase and sale decisions based on their fair value in accordance with the Company’s documented risk management or investment strategy. Attributable transaction costs are recognized in profit or loss as incurred. Financial assets at fair value through profit or loss are measured at fair value and changes therein, which takes into account any dividend income, are recognized in profit or loss.

Financial assets classified as held-for-trading comprise short-term sovereign debt securities actively managed by the Company’s treasury department to address short-term liquidity needs.

Financial assets designated at fair value through profit or loss comprise equity securities that otherwise would have been classified as available-for-sale.

II.

Held-to-maturity financial assets

Non-derivative financial assets with fixed or determinable payments and fixed maturities are classified as held-to maturity when the Company has the intention and ability to hold them to maturity. Interest, indexation charges/credits, foreign exchange gain/losses, less impairment losses, if any, are recognized in income when incurred, as financial income/expense.

Held-to-maturity financial assets comprise debentures. Subsequent to initial recognition, held-to-maturity financial assets are measured at amortized cost.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

III.

Loans and receivables

Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are recognized initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, loans and receivables are measured at amortized cost using the effective interest method, less any impairment losses.

Loans and receivables comprise cash and cash equivalents, and trade and other receivables.

IV.

Available-for-sale financial assets

Available-for-sale financial assets are non-derivative financial assets that are designated as available for-sale or are not classified in any of the above categories of financial assets. Available-for-sale financial assets are recognized initially at fair value plus any directly attributable transaction costs.

Subsequent to initial recognition, the financial assets are measured at fair value and changes therein, other than impairment losses and foreign currency gain/losses on available-for-sale debt instruments, are recognized in other comprehensive income and presented in the fair value reserve in equity. When an investment is derecognized, the gain or loss accumulated in equity is reclassified to profit or loss.

Available-for-sale financial assets comprise equity securities and debt securities.

Cash and cash equivalents

Cash and cash equivalents comprise cash balances, call deposits and highly liquid short-term investments with maturities of three months or less from the acquisition date that are subject to an insignificant risk of changes in their fair value, and are used by the Company in the management of its short-term commitments.

Non-derivative financial liabilities

The Company initially recognizes debt securities issued and subordinated liabilities on the date that they are originated. All other financial liabilities are recognized initially on the trade date, which is the date that the Company becomes a party to the contractual provisions of the instrument.

The Company derecognizes a financial liability when its contractual obligations are discharged, cancelled or expire.

The Company classifies non-derivative financial liabilities as other financial liabilities. Such financial liabilities are initially recognized at fair value less any directly attributable transaction costs. Subsequent to initial recognition, these financial liabilities are measured at amortized cost using the effective interest method.

Other financial liabilities comprise loans and borrowings, debt securities issued (including certain preference shares), bank overdrafts, and trade and other payables.

Bank overdrafts, which are repayable on demand, form an integral part of the Company’s cash management and, when outstanding, are included as a component of cash and cash equivalents.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Interest paid is disclosed as financing activities in the statements of cash flows.

Derivative financial instruments, including hedge accounting

The Company holds derivative financial instruments to hedge its foreign currency and interest rate risk exposures. Embedded derivatives are separated from the host contract and accounted for separately if:

The economic characteristics and risks of the host contract and the embedded derivative are not closely related;

A separate instrument with the same terms as the embedded derivative would meet the definition of a derivative; and

The combined instrument is not measured at fair value through profit or loss.

On initial designation of the derivative as a hedging instrument, the Company formally documents the relationship between the hedging instrument and hedged item, including the risk management objectives and strategy in undertaking the hedge transaction and the hedged risk, together with the methods that will be used to assess the effectiveness of the hedging relationship. The Company makes an assessment, both at the inception of the hedge relationship as well as on an ongoing basis, of whether the hedging instruments are expected to be highly effective in offsetting the changes in the fair value or cash flows of the respective hedged items attributable to the hedged risk, and whether the actual results of each hedge are within a range of 80% – 125%. For a cash flow hedge of a forecast transaction, the transaction should be highly probable to occur and should present an exposure to variations in cash flows that ultimately could affect reported profit or loss.

Derivatives are initially recognized at fair value; any attributable transaction costs are recognized in profit or loss as incurred. Subsequent to initial recognition, derivatives are measured at fair value, and changes therein are accounted for as described below:

Cash flow hedges

When a derivative is designated as the hedging instrument in a hedge of the variability in cash flows attributable to a particular risk associated with a recognized asset or liability or a highly probable forecast transaction that could affect profit or loss, the effective portion of changes in the fair value of the derivative is recognized in other comprehensive income and presented in the hedging reserve in equity. Any ineffective portion of changes in the fair value of the derivative is recognized immediately in profit or loss.

When the hedged item is a non-financial asset, the amount accumulated in equity is retained in other comprehensive income and reclassified to profit or loss in the same period or periods during which the non-financial item affects profit or loss. If the hedging instrument no longer meets the criteria for hedge accounting, expires or is sold, terminated or exercised, or the designation is revoked, then hedge accounting

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

is discontinued prospectively. If the forecast transaction is no longer expected to occur, then the balance in equity is reclassified to profit or loss.

II.

Fair value hedge

Changes in fair value of derivatives, that are designated and qualify as fair value hedge, are recorded in the statement of profit or loss, with any changes in fair value of the hedged asset or liability that are attributable to the hedged risk. The Company applies hedge accounting for fair value hedges to protect itself against the risk of changes in interest rates and foreign exchange rates on loans. The gain or loss related to the effective portion of interest rate swaps to protect against fixed rate borrowings is recognized in the statement of profit and loss as "Financial expenses". The gain or loss related to the ineffective portion is recognized in the statement of profit or loss as "Other gains (losses), net". Changes in fair value of fixed rate borrowings hedged attributable to interest rate risk are recognized in the statement of profit or loss as "Financial expenses".

If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item for which the method of effective interest rate is used, is amortized to income over the period to maturity.

III.

Embedded derivatives

Changes in the fair value of separated embedded derivatives are recognized immediately in profit or loss.

IV.

Other derivative financial instruments

When a derivative financial instrument is not designated in a hedge relationship and does not qualify for hedge accounting, all changes in its fair value are recognized immediately in profit or loss.

3.4 Inventory

Inventory is recorded at the lower of average cost of acquisition or production and net realizable value.

Net realizable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses.

Provisions for slow-moving or obsolete inventory are recorded when deemed necessary by management. The cost of finished goods and work in progress comprises raw materials, direct labor, other direct costs and related production overheads (based on normal operating capacity). It excludes borrowing costs.

3.5 Non-current assets held for sale and discontinued operations

Assets are classified as held for sale when their carrying amount is to be recovered principally through a sale transaction and a sale is considered highly probable. They are measured at the lower of their carrying value or fair value less costs to sell. Any loss in the value of a group of assets

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

classified as held for sale is initially allocated to goodwill and then to remaining assets and liabilities on a pro rata basis, except that no loss is allocated to inventories, financial assets, deferred tax assets, pension plan assets and investment property. Losses recognized upon classification as held for sale and subsequent gains and losses are recognized in profit or loss. Gains are not recognized in excess of any cumulative impairment loss previously recognized.

3.6 Investment property

Agricultural land is stated at fair value, with changes in fair value recognized in profit or loss.

Sale of farms are not recognized in profit or loss until (i) the sale is concluded, (ii) the Company determines that sale receipt is probable; (iii) the revenue can be reliably measured, and (iv) the Company has transferred the ownership risks to the buyer, without any continuing involvement. The gain from sale of farms is reported in the statement of profit or loss in “Other income (expense), net” for the difference between the consideration received and the carrying amount of the farm sold.

The fair value of agricultural land was determined based on the method of direct comparison of data from the market, using transactions involving comparable properties (property type, location, and quality of the property) observed in the market (Level 2). The methodology used for determining the fair value considers direct comparisons of market information, such as market research, homogenization of values, prices, recent sales, distances, facilities, access to land, topography and soil, land use (culture), rainfall level, among others according to the norms issued by the Brazilian standards institute, ABNT - Associação Brasileira de Normas Técnicas. The portfolio is valued annually by independent experts and reviewed periodically by internal professionals technically qualified to perform such appraisals.

3.7 Property, plant and equipment

Recognition and measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation and any accumulated impairment losses.

Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of constructed assets includes:

the cost of materials and direct labor;

any other costs directly attributable to bringing the assets to a working condition for their intended use;

an estimate of the costs of dismantling and removing the items and restoring the site on which they are located, when the Company has an obligation to remove the asset or restore the site; and

capitalized borrowing costs.

Cost also includes transfers from equity of any gain or loss on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment. Purchased software that is integral to the functionality of the related equipment is capitalized as part of that equipment.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

When components of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Any gain or loss on disposal of an item of property, plant and equipment, calculated as the difference between the net proceeds from disposal and the carrying amount of the item, is recognized in profit or loss.

Reclassification to investment property

When the use of a property changes from held to use to investment property, the property is remeasured at fair value and reclassified as investment property. Any gain or loss arising on this remeasurement is recognized in equity.

Subsequent costs

Subsequent expenditure is capitalized only when it is probable that the future economic benefits associated with the expenditure will flow to the Company. Ongoing repairs and maintenance are expensed as incurred.

Depreciation

Items of property, plant and equipment are depreciated from the date they are available for use or, in respect of constructed assets, from the date that the asset is completed and ready for use.

Depreciation is calculated on the carrying value of property, plant and equipment less their estimated residual values using the straight-line basis over their estimated useful lives. Depreciation is generally recognized in profit or loss, unless it is capitalized as part of the cost of another asset. Assets recognized under finance leases are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Company will obtain ownership by the end of the lease term. Land is not depreciated.

Annual depreciation rates are shown below:

Buildings and Improvements	4%
Machinery, Equipment and Facilities	3% to 10%
Airplanes, Vessels and Vehicles	10% to 20%
Railcars	2.90%
Locomotives	3.30%
Furniture and Fixtures	10%
Computer Equipment	20%

Costs of normal periodic maintenance are recorded as expenses when incurred when the components will not improve the production capacity or introduce improvements to the equipment.

Depreciation methods, useful lives and residual values are revised at each reporting date and adjusted if appropriate.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

3.8 Intangible assets and goodwill

Goodwill

Goodwill is measured at cost less accumulated impairment losses. With respect to equity method investees, the carrying amount of goodwill is included in the carrying amount of the investment, and any impairment loss is allocated to the carrying amount of the equity method investee as a whole.

Other intangible assets

Other intangible assets that are acquired by the Company and have a finite life are measured at cost less accumulated amortization and any accumulated impairment losses.

Subsequent expenditure

Subsequent expenditures are capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditures are recognized in profit or loss as incurred.

Amortization

Except for goodwill, intangible assets are amortized on a straight-line basis over their estimated useful lives, from the date that they are available for use or acquired.

Amortization methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

Contracts with customers

Costs incurred on COMGÁS’s development of gas systems for new clients (including pipelines, valves, and general equipment) are recognized as intangible assets and amortized over the contract period.

Intangible assets related to the gas concession agreement

COMGÁS entered into a public concession agreement for the distribution of gas granted by the Conceding Authority. At the end of the concession the Conceding Authority will hold a significant portion of the infrastructure. It also controls what services must be rendered and regulates the prices charged. The concession agreement grants COMGÁS the right to charge customers for the supply of gas during the term of the concession agreement. COMGÁS recognizes this right as an intangible asset.

The intangible asset comprises: (i) the concession right recognized upon the business combination of COMGÁS, which is being amortized over the concession period on a straight line basis; and (ii) the acquired or constructed assets underlying the concession necessary for the distribution of gas, which is being depreciated to match the period over which the future economic benefits of the asset are expected to accrue to the Company, or

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

the final term of the concession, whatever occurs first. This period reflects the economic useful lives of each of the underlying assets that comprise the concession. This economic useful life is also used by the regulator, The Natural Gas Agency of the State of São Paulo, to determine the basis for measuring the tariff for rendering the services under the concession.

The concession agreement was signed on May 31, 1999 with an initial term of 30 years. Subject to review by the Conceding Authority, COMGÁS has the option to apply for a 20-year extension for gas distribution services. Contractual conditions necessary for the extension are under control of COMGÁS, as long as it is in compliance with all regulatory commitments. When the concession is terminated, the assets related to the rendering of gas distribution services will be returned to the Conceding Authority, and the Company will be entitled to receive an indemnification to be determined based on assessments and evaluations performed at that time, which may consider the book value of the concession assets.

The concession contract determines that the tariff charged by COMGÁS be reviewed annually, in May, with the aim to realign the tariff charged to consumers to the cost of the gas and adjust for inflation.

3.9 Impairment

Non-derivative financial assets

A financial asset not classified as at fair value through profit or loss, including an interest in an equity-accounted investee, is assessed at each reporting date to determine whether there is objective evidence that it is impaired. A financial asset is impaired if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset, and that loss event(s) had an impact on the estimated future cash flows of that asset that can be estimated reliably.

Objective evidence that financial assets are impaired includes default or delinquency by a debtor, restructuring of an amount due to the Company on terms that the Company would not consider otherwise, indications that a debtor or issuer will enter bankruptcy, adverse changes in the payment status of borrowers or issuers, economic conditions that correlate with defaults or the disappearance of an active market for a security. In addition, for an investment in an equity security, a significant or prolonged decline in its fair value below its cost is objective evidence of impairment.

Financial assets measured at amortized cost

The Company considers evidence of impairment for financial assets measured at amortized cost (loans and receivables and held-to-maturity financial assets) at both a specific asset and collective level. All individually significant assets are assessed for impairment. Those found not to be individually impaired are then collectively assessed for any impairment that has been incurred but not yet identified. Assets that are not individually significant are collectively assessed for impairment by grouping together assets with similar risk characteristics.

In assessing impairment collectively, the Company uses historical trends of the probability of default, the timing of recoveries and the amount of loss incurred,

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

adjusted for management’s judgment as to whether current economic and credit conditions are such that the actual losses are likely to be higher or lower than suggested by historical trends.

An impairment loss in respect of a financial asset measured at amortized cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate. Losses are recognized in profit or loss and reflected in an allowance account against loans and receivables or held-to-maturity investment securities. Interest on the impaired asset continues to be recognized. If, in a subsequent period, the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized (such as an improvement in the debtor’s credit rating), the reversal of the previously recognized impairment loss is recognized in the statement of profit or loss.

II.

Available-for-sale financial assets

Impairment losses on available-for-sale financial assets are recognized by reclassifying the accumulated losses recorded in equity to profit or loss. The cumulative loss that is reclassified from equity to profit or loss is the difference between the acquisition cost, net of any principal repayment and amortization, and the current fair value, less any impairment loss recognized previously in profit or loss. Changes in the cumulative impairment losses attributable to the application of the effective interest method are reflected as a component of interest income. If, in a subsequent periods, the fair value of an impaired available-for-sale financial asset increases and the increase can be related objectively to an event occurring after the impairment loss was recognized, then the impairment loss is reversed in profit or loss. However, any subsequent recovery in the fair value of an impaired available-for-sale financial asset is recognized in other comprehensive income.

An impairment loss with respect to an equity method investee is measured by comparing the recoverable amount of the investment with its carrying amount. An impairment loss is recognized in profit or loss. An impairment loss is reversed if there has been a favorable change in the estimates used to determine the recoverable amount.

Non-financial assets

The carrying amounts of the Company’s non-financial assets, except investment property, inventories and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. Goodwill is tested annually for impairment. An impairment loss is recognized if the carrying amount of an asset or cash-generating unit (“CGU”) exceeds its recoverable amount.

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. For impairment testing, assets are grouped together into the smallest group of assets that

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or CGUs. Subject to an operating segment ceiling test, CGUs to which goodwill has been allocated are aggregated so that the level at which impairment testing is performed reflects the lowest level at which goodwill is monitored for internal reporting purposes. Goodwill acquired in a business combination is allocated to Companies of CGUs that are expected to benefit from the synergies of the combination.

Impairment losses are recognized in profit or loss. Impairment losses recognized for CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the CGU (group of CGUs), and then to reduce the carrying amounts of the other assets in the CGU (group of CGUs) on a pro rata basis.

An impairment loss with respect to goodwill is not reversed. For other assets, an impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

3.10 Provisions

A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognized as finance cost.

As of December 31, 2014 and 2013, the Company´s liabilities included R$ 186,649 and R$227,976, respectively, in relation to a contingent consideration arrangement arising from the 2008 Esso business combination (Note 10). This contingent consideration is measured at fair value with changes in fair value recognized in profit or loss. In the year ended December 31, 2014 the Company paid R$ 60,200 under this earn-out arrangement (R$ 49,938 in the year ended March 31, 2013).

The consideration is contingent on meeting certain gross revenue and sales volume targets for ExxonMobil products for a 10-year period from 2008.

3.11 Employee benefits

Short-term employee benefits

Short-term employee benefit obligations are measured on an undiscounted basis and are expensed when the related service is provided. A liability is recognized for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Company has a present legal or constructive obligation to pay these amounts as a result of past services provided by the employee, and the obligation can be estimated reliably.

Share-based payment transactions

The grant-date fair value of share-based payment awards granted to employees is recognized as an employee compensation expense, with a corresponding increase in equity, over the period that the employees become unconditionally entitled to the awards. The amount

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

recognized as an expense is adjusted to reflect the number of awards for which the related service and non-market performance conditions are expected to be met, such that the amount ultimately recognized as an expense is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant-date fair value of the share-based payment is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.

The fair value of the amount payable to employees with respect to share appreciation rights, which are settled in cash, is recognized as an expense with a corresponding increase in liabilities, over the period that the employees become unconditionally entitled to the cash payment. The liability is remeasured at each reporting date and at settlement date based on the fair value of the share appreciation rights. Any changes in the liability are recognized as employee benefit expenses in profit or loss.

Defined contribution plans

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and has no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plans are recognized as an employee benefit expense in profit or loss in the periods during which related services are rendered by employees. Prepaid contributions are recognized as an asset to the extent that a cash refund or a reduction in future payments is available. Contributions to a defined contribution plan that are due more than 12 months after the end of the period in which the employees render the service are discounted to their present value.

Defined benefit plans

The Company, through its indirect subsidiaries Cosan Lubrificantes Especialidades S.A. (“CLE”) and COMGÁS is the sponsor of defined benefit pension plans for some of its employees. The cost of providing benefits under the defined benefit plan is determined annually by independent actuaries using the projected unit credit method.

A defined benefit plan is a post-employment benefit plans other than a defined contribution plan. The Company’s net obligation with respect to defined benefit plans is calculated separately for each plan by estimating the amount of future benefit that employees have earned in return for their service in the current and prior periods. That benefit is discounted to determine its present value. Any unrecognized past service costs and the fair value of any plan assets are deducted. The discount rate is the yield at the reporting date of the financial statements for the high quality government bonds, and maturity dates approximating the terms of the Company’s obligations and that are denominated in the currency in which the benefits are expected to be paid.

The Company recognizes all actuarial gains and losses arising from defined benefit plans immediately in other comprehensive income and all expenses related to defined benefit plans in employee benefit expense in profit or loss.

The Company recognizes gains and losses on the curtailment or settlement of a defined benefit plan when the curtailment or settlement occurs. A curtailment occurs when the Company: (a) is demonstrably committed to make a significant reduction in the number of

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

employees covered by a plan; or (b) amend the terms of a defined benefit plan so that a significant element of future service by current employees will no longer qualify for benefits or will qualify only for reduced benefits. The gain or loss on curtailment or settlement comprises any resulting change in the fair value of plan assets, any change in the present value of the defined benefit obligation, any related actuarial gains and losses and past service cost that had not previously been recognized.

Other long-term employee benefit

The Company’s net obligation in respect of long-term employee benefits other than pension plans is the amount of future benefit that employees have earned in return for their service in the current and prior periods. That benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is the yield at the reporting date of the financial statements for the high credit quality bonds, and maturity dates approximating the terms of the Company’s obligations and that are denominated in the currency in which the benefits are expected to be paid. The calculation is performed using the projected unit credit method. Any actuarial gains and losses are recognized in profit or loss in the period in which they arise.

3.12 Revenue

Sales of goods

Revenue from the sale of goods, in the ordinary course of business, is measured at the fair value of the consideration received or receivable, net of returns, trade discounts and volume rebates. Revenue is recognized when significant risks and rewards of ownership have been transferred to the customer, recovery of the consideration is probable, the associated costs and possible return of goods can be estimated reliably, there is no continuing management involvement with the goods, and the amount of revenue can be measured reliably. If it is probable that discounts will be granted and the amount can be measured reliably, then the discount is recognized as a reduction of revenue as the sales are recognized.

Services rendered

Revenues from services are recognized when the amount of revenue can be measured reliably, when it is probable that the economic benefits associated with the transaction will flow to the Company, when the stage of completion of the transaction at the end of the reporting period can be measured reliably, as well as when its amount and related costs can be measured reliably. Service prices are established based on service orders or contracts. Services for which payment is made in advance are recorded as deferred revenue in other liabilities and recognized in revenue when the services are rendered.

COMGÁS revenue recognizes revenue as follows:

Billed revenue

Revenue from gas distribution services is recognized when its amount can be reliably measured, and is recognized in profit or loss when the volumes are delivered to customers.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

II.

Unbilled revenue

Unbilled gas refers to the portion of gas supplied for which metering and billing to customers have not yet occurred. This amount is estimated based on the period between measurement and the last day of the month.

The actual volume billed may be different from estimates. The Company believes that, based on experience, the unbilled estimated amount will not significantly differ from actual amounts.

III.

Concession construction revenue

The construction of the infrastructure necessary for gas distribution is considered a construction service rendered to the Conceding Authority, and the related income is recognized in profit or loss at fair value.

Construction costs are recognized by reference to the stage of completion of the construction activity at the end of the reporting period, and are included in cost of sales.

3.13 Leases

Leased assets

Assets held by the Company under leases which transfer to the Company substantially all of the risks and rewards of ownership are classified as finance leases. On initial recognition, the leased asset is measured at an amount equal to the lower of its fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset.

Assets leased under operating leases are not recognized in the Company’s statement of financial position.

Leased payments

Payments made under operating leases are recognized in profit or loss on a straight-line basis over the term of the lease. Lease incentives received are recognized as an integral part of the total lease expense, over the term of the lease.

Minimum lease payments made under finance leases are apportioned between the finance expense and the reduction of the outstanding liability. The finance expense is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.

3.14 Finance income and finance expense

Finance income comprises interest income on funds invested (including available-for-sale financial assets), dividend income, gains on the disposal of available-for-sale financial assets, fair value gains on financial assets at fair value through profit or loss, gains on the remeasurement to fair value of any pre-existing interest in an acquiree in a business combination, gains on hedging instruments that

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

are recognized in profit or loss and reclassifications of net gains previously recognized in other comprehensive income. Interest income is recognized as it accrues in profit or loss, using the effective interest method. Dividend income is recognized in profit or loss on the date that the Company’s right to receive payment is established, which in the case of quoted securities is normally the ex-dividend date.

Finance expense comprise interest expense on borrowings, unwinding of the discount on provisions and deferred consideration, losses on disposal of available-for-sale financial assets, dividends on preference shares classified as liabilities, fair value losses on financial assets at fair value through profit or loss and contingent consideration, impairment losses recognized on financial assets (other than trade receivables), losses on hedging instruments that are recognized in profit or loss and reclassifications of net losses previously recognized in other comprehensive income.

Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognized in profit or loss using the effective interest method.

Foreign currency gains and losses on financial assets and financial liabilities are reported on a net basis as either finance income or finance cost depending on whether the net foreign currency fluctuations result in a gain or loss position.

3.15 Tax

Income taxes are comprised of income tax and social contribution at a combined rate of 34%. Tax expense comprises current and deferred tax. Current tax and deferred tax is recognized in profit or loss except to the extent that it relates to a business combination, or items recognized directly in equity or in other comprehensive income.

Certain subsidiaries measure income tax and social contribution due under the Brazilian presumed profits regime. The presumed profit came up from a percentage of 32% of operating revenues. Under the aforementioned regime the applicable tax rate is for income tax is 15% over the presumed profit, plus an additional 10% when operating revenues exceed of R$ 240, and 9% over the presumed profit for social contribution.

Current tax

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. Current tax payable also includes any tax liability arising from the declaration of dividends.

Deferred tax

Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes and tax loss. Deferred tax is not recognized for:

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss;

temporary differences related to investments in subsidiaries, associates and joint ventures to the extent that the Company is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and

taxable temporary differences arising on the initial recognition of goodwill.

The measurement of deferred tax reflects the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. For investment property that is measured at fair value, the presumption that the carrying amount of the investment property will be recovered through sale has not been rebutted.

Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date.

Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realized simultaneously.

A deferred tax asset is recognized for loss carryforwards, tax credits and deductible temporary differences to the extent that it is probable that future taxable income will be generated in the future. Deferred tax assets are reviewed at each reporting date and written off to the extent that it is no longer probable that the related tax benefit will be realized.

Sales taxes

Net revenue is recognized net of discounts and sales taxes.

Tax exposures

In determining the amount of current and deferred tax, the Company takes into account the impact of uncertain tax positions and whether additional taxes and interest may be due. This assessment relies on estimates and assumptions and may involve a series of judgments about future events. New information may become available that causes the Company to change its judgment regarding the adequacy of existing tax liabilities; such changes to tax liabilities will impact tax expense in the period that such a determination is made.

4	Changes in accounting policies

4 .1 New standards and interpretations not yet adopted

A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after January 1, 2015, and have not been applied in preparing these consolidated financial statements. None of these is expected to have a significant effect on the consolidated financial statements of the Company, except the following:

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

IFRS 9, ‘Financial instruments’, addresses the classification, measurement and recognition of financial assets and financial liabilities. IFRS 9 was issued in November 2009 and October 2010. IFRS 9 requires financial assets to be classified into two measurement categories: those measured as at fair value and those measured at amortized cost. The determination is made at initial recognition. For financial liabilities, the main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair value change due to an entity’s own credit risk is recorded in other comprehensive income rather than the statement of profit or loss, unless this creates an accounting mismatch. The Company has yet to assess IFRS 9’s full impact. The Company will also consider the impact of the remaining phases of IFRS 9 when completed by the Board.

IFRS 9 is effective for annual reporting periods beginning on or after January 1, 2018, with early adoption permitted.

II.

IFRS 15, ‘Revenue from contracts with customers’ deals with revenue recognition and establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. Revenue is recognized when a customer obtains control of a good or service and thus has the ability to direct the use and obtain the benefits from the good or service. The standard replaces IAS 18 ‘Revenue’ and IAS 11 ‘Construction contracts’ and related interpretations. The standard is effective for annual periods beginning on or after January 1, 2017 and earlier application is permitted. The Company is currently assessing the potential impacts of adopting IFRS 15.

III.

IAS 41 - Agriculture - This standard currently requires that biological assets related to agricultural activity are measured at fair value less costs to sell. IASB has determined that “bearer plants” should be accounted for as property, plant and equipment (IAS 16), i.e., at cost less depreciation or impairment provision. The standard is effective for annual reporting beginning on or after January 1, 2016 with early adoption permitted. The Company is assessing the potential impacts of adopting IAS 41.

IV.

IFRIC 21, ‘Levies’, sets out the accounting for an obligation to pay a levy that is not income tax. The interpretation addresses what the obligating event is that gives rise to pay a levy and when should a liability be recognized. The Company is not currently subject to significant levies therefore it does not expect that the application of the new standard will have a material impact on the Company’s consolidated financial statements.

There are no other Standards or Interpretations that are not yet effective that would be expected to have a material impact on the Company.

4.2 Correction of an error

During 2014, the Company identified an immaterial mathematical error in the calculation of diluted earnings per share impacting the nine-months period ended December 31, 2013 and the year ended March 31, 2013. The error consisted of a mathematical inaccurate calculation on the monetary effect of dilution on the profit attributable to shareholders of the parent.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

The diluted earnings per share from continuing operations for the nine-month period ended December 31, 2013 and the year ended March 31, 2013 were originally presented, in error, as R$ 0.33 and R$ 1.06, respectivelly. These amounts are being revised on the face of statement of profit or loss and other comprehensive and in the Note 24 as R$0.40 and R$ 1.21, respectively.

5	Operating segments

Segment information

The following segment information is used by Cosan's senior management (the “Chief Operating Decision Maker”) to assess the performance of the operating segments and to make decisions with regards to the allocation of resources. This information is prepared on a basis consistent with the accounting policies used in the preparation of the financial statements. Cosan evaluates the performance of its operating segments based on the measure of Earnings Before Interest Tax, Depreciation and Amortization (“EBITDA”). A reconciliation of EBITDA to profit (loss) is presented below.

Operating segments

Raízen Energia: production and marketing of a variety of products derived from sugar cane, including raw sugar (VHP), anhydrous and hydrated ethanol, and activities related to energy cogeneration from sugarcane bagasse. In addition, this segment holds interests in companies engaged in research and development on new technology;

II.

Raízen Combustíveis: distribution and marketing of fuels, mainly through a franchised network of service stations under the brand Shell and Esso throughout Brazil;

III.

COMGÁS: distribution of piped natural gas to part of the State of São Paulo (approximately 180 municipalities, including the region called Greater São Paulo) to customers in the industrial, residential, commercial, automotive, thermo generation and cogeneration sectors;

IV.

Cosan Log: logistics services for transport, storage and port loading of commodities, mainly for sugar products;

Radar: management, buying, selling and leasing of agricultural land;

VI.

Lubricants: production and distribution of lubricants under the Mobil brand in Brazil, Bolivia, Uruguay and Paraguay, as well as European and Asian market with a Comma trademark; Upon adoption of IFRS 11, whereby the Company no longer proportionally consolidates the results of Raízen Energia and Raízen Combustíveis, the Lubricants segment met the quantitative thresholds to be separately reportable, and the comparative segment information has been adjusted retroactively; and

VII.	Other business: other investments, in addition to the corporate activities of the Company.

Although Raízen Energia and Raízen Combustíveis are equity accounted joint-ventures and are no longer proportionally consolidated since adoption of IFRS 11, senior management continues to review segment information. A reconciliation of these segments is presented in the column “Deconsolidation IFRS 11”.

The following statement of financial position and profit or loss selected information by segment was prepared on the same basis as the accounting practices used in the preparation of consolidated information:

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

	Twelve months ended December 31, 2014
	Raízen Energia			Raízen Combustíveis			COMGÁS			Radar			Lubricants			Other business			Deconsolidated effects IFRS 11			Segment elimination			Cosan Energia			Cosan Log			Cosan Limited			Segment elimination			Total consolidated
	Raízen Energia			Raízen Combustíveis			COMGÁS			Radar			Lubricants			Other business			Deconsolidated effects IFRS 11			Segment elimination			Cosan Energia			Cosan Log			Cosan Limited			Segment elimination			Total consolidated
Statement of profit or loss
Net sales		9,263,930			55,733,927			6,387,103			157,562			1,602,198			-			(64,997,857	)		-			8,146,863			915,441			-			-			9,062,304
Domestic market		4,064,437			55,733,927			6,387,103			157,562			1,306,218			-			(59,798,364	)		-			7,850,883			769,583			-			-			8,620,466
External market		5,199,493			-			-			-			295,980			-			(5,199,493	)		-			295,980			145,858			-			-			441,838
Gross profit		1,528,509			2,799,705			1,892,194			96,918			354,392			-			(4,328,214	)		-			2,343,504			305,080			-			-			2,648,584
Selling expenses		(578,989	)		(1,150,516	)		(636,316	)		-			(245,227	)		-			1,729,505			-			(881,543	)		-			-			-			(881,543	)
General and administrative expenses		(498,756	)		(387,259	)		(308,413	)		(36,525	)		(70,684	)		(145,840	)		886,015			-			(561,462	)		(87,832	)		(19,319	)		-			(668,613	)
Other income (expense), net		58,609			338,143			(19,494	)		131,593			1,032			(123,626	)		(396,752	)		-			(10,495	)		7,844			-			(18,589	)		(21,240	)
Financial results		(418,317	)		(125,210	)		(193,026	)		6,269			21,555			(780,687	)		543,527			-			(945,889	)		(33,652	)		(3,307	)		-			(982,848	)
Financial expense		(588,307	)		(142,839	)		(300,573	)		(1,104	)		22,831			(707,718	)		731,146			12,711			(973,853	)		(66,114	)		(20,835	)		-			(1,060,802	)
Financial income		385,895			104,218			106,554			7,428			1,639			81,280			(490,113	)		(12,711	)		184,190			31,150			1,772			-			217,112
Foreign exchange losses, net		(357,928	)		(71,825	)		(139,931	)		(55	)		(1,183	)		(177,815	)		429,753			-			(318,984	)		1,312			17,151			-			(300,521	)
Derivatives		142,023			(14,764	)		140,924			-			(1,732	)		23,566			(127,259	)		-			162,758			-			(1,395	)		-			161,363
Equity in earnings of associates		(38,310	)		14,902			-			-			(7,341	)		429,506			23,408			(418,625	)		3,540			-			193,627			(193,627	)		3,540
Equity in earnings of joint ventures		-			-			-			-			-			588,428			-			-			588,428			-			-			-			588,428
Income tax (expense) benefit		103,810			(410,560	)		(203,810	)		(17,629	)		(18,850	)		254,803			306,750			-			14,514			(58,343	)		-			-			(43,829	)

Profit (loss) for the year		156,556			1,079,205			531,135			180,626			34,877			222,584			(1,235,761	)		(418,625	)		550,597			133,097			171,001			(212,216	)		642,479

Other selected data
Depreciation and amortization		1,966,866			538,222			506,697			970			71,268			2,923			(2,505,088	)		-			581,858			97,244			-			-			679,102
EBITDA		2,437,929			2,153,197			1,434,668			192,956			103,441			751,389			(4,591,126	)		(418,625	)		2,063,829			322,334			174,308			(212,216	)		2,348,255
Additions to PP&E, intangible
and biological assets (cash)		1,963,642			60,425			661,311			1,146			52,178			75,194			(2,024,067	)		-			789,830			273,584			-			-			1,063,413

Reconciliation of EBITDA
Profit (loss) for the year		156,556			1,079,205			531,135			180,626			34,878			222,583			(1,235,761	)		(418,625	)		550,597			133,095			171,001			(212,216	)		642,477
Income tax and social contribution		(103,810	)		410,560			203,810			17,629			18,850			(254,803	)		(306,750	)		-			(14,514	)		58,343			-			-			43,829
Financial result, net		418,317			125,210			193,026			(6,269	)		(21,555	)		780,687			(543,527	)		-			945,889			33,652			3,307			-			982,848
Depreciation and amortization		1,966,866			538,222			506,697			970			71,268			2,922			(2,505,088	)		-			581,857			97,244			-			-			679,101

EBITDA		2,437,929			2,153,197			1,434,668			192,956			103,441			751,389			(4,591,126	)		(418,625	)		2,063,829			322,334			174,308			(212,216	)		2,348,255

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

	Nine months ended December 31, 2013
	Raízen Energia			Raízen Combustíveis			COMGÁS			Radar			Lubricants			Other business			Deconsolidated effects IFRS 11			Segment elimination			Cosan Energia			Cosan Log			Cosan Limited			Segment elimination			Total consolidated
	Raízen Energia			Raízen Combustíveis			COMGÁS			Radar			Lubricants			Other business			Deconsolidated effects IFRS 11			Segment elimination			Cosan Energia			Cosan Log			Cosan Limited			Segment elimination			Total consolidated
Statement of profit or loss
Net sales		6,850,389			37,580,570			4,888,895			54,732			1,185,199			38			(44,430,959	)		-			6,128,864			749,350			-			-			6,878,214
Domestic market		2,964,443			37,580,570			4,888,895			54,732			947,274			38			(40,545,013	)		-			5,890,939			676,924			-			-			6,567,863
External market		3,885,946			-			-			-			237,925			-			(3,885,946	)		-			237,925			72,426			-			-			310,351
Gross profit		1,260,349			1,916,015			1,364,700			48,674			284,668			38			(3,176,364	)		-			1,698,080			301,905			-			-			1,999,985
Selling expenses		(474,116	)		(808,095	)		(422,416	)		-			(181,549	)		-			1,282,211			-			(603,965	)		-			-			-			(603,965	)
General and administrative expenses		(411,600	)		(285,904	)		(239,262	)		(18,369	)		(52,552	)		(96,288	)		697,504			-			(406,471	)		(57,588	)		(2,874	)		-			(466,933	)
Other income (expense), net		(35,209	)		292,211			(1,599	)		131,191			(5,488	)		(26,485	)		(257,002	)		-			97,619			(14,364	)		(6,983	)		-			76,272
Financial results		(646,268	)		(99,201	)		(140,981	)		3,096			(9,072	)		(567,039	)		745,469			-			(713,996	)		13,689			(13,405	)		-			(713,712	)
Financial expense		(346,004	)		(63,418	)		(163,090	)		(668	)		(51,689	)		(559,434	)		409,422			9,008			(765,873	)		(27,975	)		(10,758	)		-			(804,606	)
Financial income		186,230			69,070			44,659			3,812			23,409			75,477			(255,300	)		(9,008	)		138,349			41,292			263			-			179,904
Foreign exchange losses, net		(370,860	)		(181,419	)		(162,449	)		(48	)		17,351			(178,975	)		552,279			-			(324,121	)		372			(746	)		-			(324,495	)
Derivatives		(115,634	)		76,566			139,899			-			1,857			95,893			39,068			-			237,649			-			(2,164	)		-			235,485
Equity in earnings of associates		(24,075	)		4,826			-			29			(7,812	)		447,769			19,249			(434,489	)		5,497			-			145,882			(145,882	)		5,497
Equity in earnings of joint ventures		-			-			-			-			-			242,036			-			-			242,036			-			-			-			242,036
Income tax (expense) benefit		122,199			(298,084	)		(152,740	)		(10,230	)		(27,176	)		234,119			175,885			-			43,973			(83,167	)		-			-			(39,194	)

Profit (loss) for the year		(208,720	)		721,768			407,702			154,391			1,019			234,150			(513,048	)		(434,489	)		362,773			160,475			122,620			(145,882	)		499,986

Other selected data
Depreciation and amortization		1,386,600			385,728			322,170			727			55,452			1,840			(1,772,328	)		-			380,189			58,955			-			-			439,144
EBITDA		1,701,949			1,504,781			1,023,593			162,252			92,718			568,912			(3,206,730	)		(434,489	)		1,412,986			288,907			136,025			(145,882	)		1,692,036
Additions to PP&E, intangible
and biological assets (cash)		1,513,389			681,241			677,695			60			81,353			18,965			(2,194,630	)		-			778,073			198,047			-			-			976,120

Reconciliation of EBITDA
Profit (loss) for the period		(208,720	)		721,768			407,702			154,391			1,019			234,150			(513,048	)		(434,489	)		362,773			160,475			122,620			(145,882	)		499,986
Income tax and social contribution		(122,199	)		298,084			152,740			10,230			27,176			(234,119	)		(175,885	)		-			(43,973	)		83,167			-			-			39,194
Financial result, net		646,268			99,201			140,981			(3,096	)		9,072			567,039			(745,469	)		-			713,996			(13,689	)		13,405			-			713,712
Depreciation and amortization		1,386,600			385,728			322,170			727			55,451			1,842			(1,772,328	)		-			380,190			58,954			-			-			439,144

EBITDA		1,701,949			1,504,781			1,023,593			162,252			92,718			568,912			(3,206,730	)		(434,489	)		1,412,986			288,907			136,025			(145,882	)		1,692,036

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

	Twelve months ended March 31, 2013
	Raízen Energia			Raízen Combustíveis			COMGÁS			Radar			Lubricants			Other business			Deconsolidated effects IFRS 11			Segment elimination			Cosan Energia			Cosan Log			Cosan Limited			Segment elimination			Total consolidated			Discontinued operation
	Raízen Energia			Raízen Combustíveis			COMGÁS			Radar			Lubricants			Other business			Deconsolidated effects IFRS 11			Segment elimination			Cosan Energia			Cosan Log			Cosan Limited			Segment elimination			Total consolidated			Discontinued operation
Statement of profit or loss
Net sales		8,468,238			43,532,232			2,398,989			51,853			1,417,474			5,117			(52,000,470	)		-			3,873,433			712,776			-			-			4,586,209			410,677
Domestic market		3,454,440			43,532,232			2,398,989			51,853			1,237,348			5,117			(46,986,672	)		-			3,693,307			631,908			-			-			4,325,215			410,677
External market		5,013,798			-			-			-			180,126			-			(5,013,798	)		-			180,126			80,868			-			-			260,994			-
Gross profit		1,586,321			2,333,213			660,676			50,111			366,780			5,116			(3,919,534	)		-			1,082,683			292,217			-			-			1,374,900			56,487
Selling expenses		(638,837	)		(1,026,923	)		(259,762	)		-			(199,671	)		-			1,665,760			-			(459,433	)		-			-			-			(459,433	)		(50,285	)
General and administrative expenses		(490,246	)		(361,616	)		(127,678	)		(14,899	)		(72,514	)		(127,440	)		851,862			-			(342,531	)		(58,088	)		(18,914	)		-			(419,533	)		(8,217	)
Other income (expense), net		49,837			219,520			(2,221	)		144,344			(18,570	)		57,678			(269,357	)		-			181,231			(7,492	)		-			-			173,739			172,586
Financial results		(334,399	)		(58,632	)		(63,701	)		3,058			114,654			(465,057	)		393,031			-			(411,046	)		189			(12,256	)		-			(423,113	)		10,166
Financial expense		(198,174	)		(96,058	)		(92,178	)		(1,421	)		(39,976	)		(398,734	)		294,232			-			(532,309	)		(35,567	)		(10,129	)		-			(578,005	)		-
Financial income		185,572			133,362			16,894			4,484			43,332			63,153			(318,934	)		-			127,863			35,658			142			-			163,663			10,166
Foreign exchange losses, net		(266,135	)		(93,841	)		(297	)		(5	)		105,712			(186,493	)		359,976			-			(81,083	)		98			(2,269	)		-			(83,254	)		-
Derivatives		(55,662	)		(2,095	)		11,880			-			5,586			57,017			57,757			-			74,483			-			-			-			74,483			-
Equity in earnings of associates		(23,107	)		-			-			-			(111	)		427,732			23,107			(245,769	)		181,852			-			-			(111,438	)		70,414			-
Equity in earnings of joint ventures		-			-			-			-			-			483,355			-			-			483,355			-			120,557			-			603,912			-
Income tax (expense) benefit		176,742			(314,838	)		(47,439	)		(13,180	)		(50,735	)		61,424			138,096			-			(49,930	)		(76,423	)		-			-			(126,353	)		(41,819	)

Profit (loss) for the year		326,311			790,724			159,875			169,434			139,833			442,808			(1,117,035	)		(245,769	)		666,181			150,403			89,387			(111,438	)		794,533			138,918

Other selected data
Depreciation and amortization		1,924,301			494,301			200,451			877			61,759			1,656			(2,418,602	)		-			264,743			70,043			-			-			334,786			1,185
EBITDA		2,408,269			1,658,495			471,466			180,433			137,673			848,097			(4,066,764	)		(245,769	)		1,391,900			296,680			101,643			(111,438	)		1,678,785			171,756
Additions to PP&E, intangible
and biological assets (cash)		2,404,514			677,245			294,359			760			72,891			2,461			(3,081,759	)		-			370,471			266,661			-			-			637,132			-

Reconciliation of EBITDA
Profit (loss) for the year		326,311			790,724			159,875			169,434			139,833			442,808			(1,117,035	)		(245,769	)		666,181			150,403			89,387			(111,438	)		794,533			138,918
Income tax and social contribution		(176,742	)		314,838			47,439			13,180			50,735			(61,424	)		(138,096	)		-			49,930			76,423			-			-			126,353			41,819
Financial result, net		334,399			58,632			63,701			(3,058	)		(114,654	)		465,057			(393,031	)		-			411,046			(189	)		12,256			-			423,113			(10,166	)
Depreciation and amortization		1,924,301			494,301			200,451			877			61,759			1,656			(2,418,602	)		-			264,743			70,043			-			-			334,786			1,185

EBITDA		2,408,269			1,658,495			471,466			180,433			137,673			848,097			(4,066,764	)		(245,769	)		1,391,900			296,680			101,643			(111,438	)		1,678,785			171,756

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

	December 31, 2014
	Raízen Energia			Raízen Combustíveis			COMGÁS			Radar			Lubricants			Other business			Deconsolidated effects IFRS 11			Segment elimination			Cosan Energia			Cosan Log			Cosan Limited			Segment elimination			Total consolidated


Statement of financial position
Cash and cash equivalents		2,643,950			173,470			973,708			6,011			39,810			520,663			(2,817,420	)		-			1,540,192			86,487			22,661			-			1,649,340
Investment securities		-			-			-			149,735			-			-			-			-			149,735			-			-			-			149,735
Trade receivables		620,300			1,920,778			605,483			22,214			194,486			241			(2,541,078	)		-			822,424			42,685			-			-			865,109
Inventories		2,315,907			1,128,771			125,406			-			222,486			11			(3,444,678	)		-			347,903			5,817			-			-			353,720
Other current assets		2,680,822			521,630			137,360			31,052			31,831			367,641			(3,202,452	)		(19,750	)		548,134			24,500			19,658			(45,089	)		547,203
Other non-current assets		2,075,546			2,365,613			591,135			15,538			(190,806	)		2,331,354			(4,441,159	)		(6,610	)		2,740,611			480,989			10,220			-			3,231,820
Investment in associates		209,205			256,729			-			-			16,032			5,783,699			(465,934	)		(5,669,053	)		130,678			-			6,132,772			(6,132,773	)		130,677
Investment in joint ventures		-			-			-			-			-			8,404,503			-			-			8,404,503			-			-			-			8,404,503
Biological assets		1,828,304			-			-			-			-			-			(1,828,304	)		-			-			-			-			-			-
Investment property		-			-			-			2,641,978			-			-			-			-			2,641,978			-			-			-			2,641,978
Property, plant and equipment		9,848,969			2,464,316			-			11,288			221,466			118,681			(12,313,285	)		-			351,435			1,084,455			-			-			1,435,890
Intangible assets and goodwill		3,288,709			4,267,514			8,595,251			173			824,277			6,419			(7,556,223	)		-			9,426,120			860,253			-			-			10,286,373
Loans and borrowings		(10,377,585	)		(1,557,782	)		(3,133,347	)		-			(261,166	)		(4,003,089	)		11,935,367			-			(7,397,602	)		(784,709	)		(320,329	)		-			(8,502,640	)
Trade payables		(636,619	)		(529,990	)		(848,770	)		(790	)		(118,784	)		(2,826	)		1,166,609			-			(971,170	)		(141,289	)		-			-			(1,112,459	)
Employee benefits payable		(252,219	)		(66,799	)		(58,955	)		(5,336	)		(15,437	)		(21,387	)		319,018			-			(101,115	)		(19,302	)		-			-			(120,416	)
Other current liabilities		(1,103,934	)		(2,074,917	)		(122,981	)		(20,783	)		(100,853	)		(398,334	)		3,178,851			26,361			(616,590	)		(89,787	)		(12,712	)		37,374			(681,715	)
Other non-current liabilities		(2,719,593	)		(2,273,554	)		(992,028	)		(93,552	)		(193,082	)		(4,289,299	)		4,993,147			-			(5,567,961	)		(221,851	)		(7,721	)		7,722			(5,789,811	)
Total assets (net of
liabilities) allocated by segment		10,421,762			6,595,779			5,872,262			2,757,528			670,260			8,818,278			(17,017,541	)		(5,669,052	)		12,449,275			1,328,248			5,844,549			(6,132,766	)		13,489,307

Total assets		25,511,712			13,098,821			11,028,343			2,877,989			1,359,582			17,533,212			(38,610,533	)		(5,695,413	)		27,103,713			2,585,186			6,185,311			(6,177,862	)		29,696,348

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

	December 31, 2013
	Raízen Energia			Raízen Combustíveis			COMGÁS			Radar			Lubricants			Other business			Deconsolidated effects IFRS 11			Segment elimination			Cosan Energia			Cosan Log			Cosan Limited			Segment elimination			Total consolidated


Statement of financial position
Cash and cash equivalents		1,058,483			328,992			535,957			13,408			57,892			369,543			(1,387,475	)		-			976,800			497,753			35,012			-			1,509,565
Investment securities		-			-			-			87,978			-			-			-			-			87,978			-			-			-			87,978
Trade receivables		416,746			1,435,095			582,889			28,052			200,795			241			(1,851,841	)		-			811,977			32,506			-			-			844,483
Inventories		2,026,925			1,057,049			121,253			-			185,490			-			(3,083,974	)		-			306,743			5,237			-			-			311,980
Other current assets		1,279,553			484,475			248,803			323,474			45,227			332,012			(1,764,028	)		(144,261	)		805,255			22,389			52,091			(69,740	)		809,995
Other non-current assets		1,534,557			1,403,117			332,918			4,884			(93,658	)		2,755,375			(2,937,674	)		(415,785	)		2,583,734			234,965			-			-			2,818,699
Investment in associates		408,591			254,826			-			-			15,364			6,101,361			(663,417	)		(6,013,409	)		103,316			-			6,081,878			(6,081,878	)		103,316
Investment in joint ventures		-			-			-			-			-			8,498,259			-			-			8,498,259			-			-			-			8,498,259
Biological assets		1,867,765			-			-			-			-			-			(1,867,765	)		-			-			-			-			-			-
Investment property		-			-			-			2,281,509			-			-			-			-			2,281,509			-			-			-			2,281,509
Property, plant and equipment		9,504,874			2,494,486			-			11,195			197,137			50,430			(11,999,360	)		-			258,762			1,013,148			-			-			1,271,910
Intangible assets and goodwill		3,100,227			4,038,314			8,450,541			89			867,826			3,949			(7,138,541	)		-			9,322,405			755,635			-			-			10,078,040
Loans and borrowings		(7,732,778	)		(862,521	)		(2,841,387	)		-			(209,579	)		(5,073,219	)		8,595,299			-			(8,124,185	)		(705,974	)		(262,797	)		-			(9,092,956	)
Trade payables		(633,505	)		(551,176	)		(706,397	)		(1,216	)		(70,102	)		(1,562	)		1,184,681			(282	)		(779,559	)		(82,870	)		-			-			(862,429	)
Employee benefits payable		(249,919	)		(60,091	)		(59,417	)		(4,247	)		(13,039	)		(14,071	)		310,010			-			(90,774	)		(12,522	)		-			-			(103,296	)
Other current liabilities		(495,240	)		(525,188	)		(301,089	)		(31,020	)		(107,826	)		(260,413	)		1,020,428			143,979			(556,369	)		(127,289	)		(20,188	)		69,740			(634,106	)
Other non-current liabilities		(1,693,036	)		(2,715,727	)		(863,768	)		(85,951	)		(327,564	)		(3,543,908	)		4,408,763			416,347			(4,404,844	)		(198,620	)		-			280			(4,603,184	)
Total assets (net of
liabilities) allocated by segment		10,393,243			6,781,651			5,500,303			2,628,155			747,963			9,217,997			(17,174,894	)		(6,013,411	)		12,081,007			1,434,358			5,885,996			(6,081,598	)		13,319,763

Total assets		21,197,721			11,496,354			10,272,361			2,750,589			1,476,073			18,111,170			(32,694,075	)		(6,573,455	)		26,036,738			2,561,633			6,168,981			(6,151,618	)		28,615,734

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Net sales by segment:

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013
Raízen Energia
Ethanol		4,376,826			3,143,254			3,299,938
Sugar		4,059,580			3,127,616			4,353,994
Cogeneration		618,583			376,579			569,709
Other		208,941			202,940			244,597
		9,263,930			6,850,389			8,468,238
Raízen Combustíveis
Fuels		55,733,927			37,553,167			43,516,040
Other		-			27,403			16,192
		55,733,927			37,580,570			43,532,232
COMGÁS
Industrial		4,122,077			3,065,600			1,535,941
Residential		632,997			522,642			203,254
Thermo generation		407,736			212,103			148,652
Cogeneration		246,841			187,457			112,705
Automotive		199,820			151,195			77,486
Commercial		255,051			186,932			84,517
Construction revenue		481,314			536,482			230,038
Other		41,267			26,484			6,396
		6,387,103			4,888,895			2,398,989
Radar
Property sales		85,308			5,694			4,721
Land lease		60,944			49,038			47,132
Other		11,310			-			-
		157,562			54,732			51,853
Lubricants
Lubricants		1,325,472			1,040,150			1,245,571
Basic oil		225,701			137,309			162,021
Other		51,025			7,740			9,882
		1,602,198			1,185,199			1,417,474

Other businesses		-			38			5,117

IFRS 11 - Deconsolidated of
adjustments/eliminations joint
ventures and eliminations		(64,997,857	)		(44,430,959	)		(52,000,470	)

Cosan Energia		8,146,863			6,128,864			3,873,433

Cosan Log
Logistics		671,600			597,476			549,420
Port handling		220,543			138,236			150,028
Other		23,298			13,638			13,328
		915,441			749,350			712,776

Total		9,062,304			6,878,214			4,586,209

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Net sales by region

Net sales of Cosan Log and Lubricants by geographic area are as follow:

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013
Brazil		83.23	%		84.31	%		86.90	%
Europe		12.13	%		2.27	%		1.73	%
South America (excepting Brazil)		2.93	%		12.44	%		10.81	%
North America		0.70	%		0.09	%		-
Middle East and Asia		0.95	%		0.79	%		0.53	%
Other		0.07	%		0.10	%		0.03	%

Total		100.00	%		100.00	%		100.00	%

COMGÁS and Radar’s net sales are only to the domestic market (Brazil).

Concentration of customers

(i)

COMGÁS

No customers or specific group represented 10% or more of net sales for the periods presented.

(ii)

Cosan Log

In 2014, 27% of the segment’s net sales was generated from sales to Raízen Energia (35% for nine months ended December 31, 2013; 40% for year ended March 31, 2013).

(iii)

Radar

In 2014, 15% of the segment’s net sales was generated from sales to Raízen Energia (22% through nine months ended December 31, 2013; 26% for year ended March 31, 2013).

(iv)	Lubricants

No customers or specific group represented 10% or more of sales for the year ended December 31, 2014, for nine months ended December 31, 2013 and for year ended March 31, 2013.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

6	Cash and cash equivalents

	December 31, 2014		December 31, 2013
Brazilian Reais
Cash and bank deposits		57,703		92,064
Short-term investments		1,496,620		1,356,239

		1,554,323		1,448,302
U.S. Dollars and Pound Sterling
Cash and bank deposits		95,017		30,802
Short-term investments		-		30,460

		95,017		61,262
		1,649,340		1,509,565

Short-term investments are composed as presented below:

	December 31, 2014		December 31, 2013
	December 31, 2014		December 31, 2013
Exclusive funds
Repurchase agreements(I)		423,535		661,665
Bank certificate of deposits - CDB(II)		87,646		175,895
		511,181		837,560

Bank investments
Bank certificate of deposits - CDB(II)		222,570		147,782
Repurchase agreements(I)		762,869		370,897
Other financial investments		-		30,460
		985,439		549,139

		1,496,620		1,386,699

(I)

These refer to purchases of assets, mainly government securities, with the commitment to repurchase at a rate previously established by the parties, generally with a one-day term.

(II)

These refer mainly to Bank Deposit Certificates - CDBs, issued by Brazilian financial institutions with original maturities of 90 days or less or for which there are no penalties or other restrictions for early redemption.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

7	Trade receivables


	December 31, 2014			December 31, 2013
Domestic - Brazilian Reais		1,369,013			1,087,118
Export - Foreign currency		25,323			24,453
Allowance for doubtful accounts		(48,235	)		(28,628	)

		1,346,101			1,082,943

Current		865,109			844,483
Non-current(i)		480,992			238,460

(i)

As of December 31, 2014, Rumo had an accounts receivable due from ALL of R$446,693 (R$225,401 at December 31, 2013) reflecting contractual revenue recognized in accordance with IAS 18 - Revenue. Additional amounts totaling R$183,144, including penalties and interest, were not recognized because not all criteria for revenue recognition had been fulfilled.

The ageing of trade receivables is as follows:

	December 31, 2014		December 31, 2013
	December 31, 2014		December 31, 2013
Not overdue		780,010		776,342
Overdue:
From 1 to 30 days		119,520		78,110
From 31 to 60 days		29,863		38,546
From 61 to 90 days		33,897		58,044
More than 90 days		382,811		131,901

		1,346,101		1,082,943

Changes in the allowance for doubtful accounts is as follows:

At April 1, 2013				(21,411	)
Provision				(24,891	)
Reversal				960
Write-offs				16,714
At December 31, 2013				(28,628	)
Provision				(22,277	)
Reversal				2,670

At December 31, 2014				(48,235	)

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

8	Inventories

	December 31, 2014			December 31, 2013
Finished goods		223,706			185,620
Work in process		86,895			82,361
Spare parts and other		47,887			44,331
Provision for slow moving inventory
and obsolescence		(4,768	)		(332	)

		353,720			311,980

Changes in the provision for slow moving inventory and obsolescence:

At April 1, 2013					(255	)
Provision					(77	)
At December 31, 2013					(332	)
Provision					(4,436	)

At December 31, 2014					(4,768	)

9	Taxes recoverable

	December 31, 2014			December 31, 2013
ICMS - State VAT		91,121			97,648
COFINS - Revenue tax		12,604			25,779
PIS - Revenue tax		8,387			7,838
IPI - Excise tax		965			-
Other		(16,960	)		(27,466	)
		96,117			103,799

Current		78,818			85,433
Non-current		17,299			18,366

10	Other financial assets

	December 31, 2014		December 31, 2013
Exxon Mobil financial assets(i)		332,405		309,378
Receivable from sale of
discontinued operations(ii)		107,775		160,783
		440,180		470,161

Current		69,683		63,054
Non-current		370,497		407,107

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

(i)

On June 28, 2011, CLE, the successor entity of Esso Brasileira de Petróleo Ltda. ("Essobrás"), joined the Brazilian Government's tax amnesty and refinancing program (“REFIS”) upon request of its prior owner, ExxonMobil Brasil Holdings B.V. ("ExxonMobil"), to settle certain tax contingencies that existed prior to the acquisition of Essobrás by the Company. ExxonMobil is legally responsible for tax contingencies that existed prior to the acquisition by the Company; therefore, this financial asset represents the amounts that the Company will be reimbursed from ExxonMobil.

(ii)

On October 24, 2012, the Company signed an Amendment to the Association Agreement and Other Covenants, dated May 28, 2012, with Camil Alimentos SA (“Camil”) whereby it agreed to the sale of all of the shares issued by its subsidiary, Docelar Alimentos e Bebidas S.A., to Camil, for R$293,770. As at December 31, 2014, R$107,774 is receivable, to be paid in two remaining installments, on October 31, 2015 and October 24, 2016. The fair value of the receivable is similar to the carrying amount as the receivable is inflation indexed.

11	Related parties

Receivables from and payables to related parties:

	December 31, 2014		December 31, 2013
Current assets
Commercial operations
Raízen Energia S.A.(ii)		23,229		27,681
Raízen Combustíveis S.A.(ii)		2,576		4,048
Aguassanta Participações S.A.		6,340		6,368
Other		556		-
		32,701		38,097
Corporate operation / Agreements
Raízen Energia S.A.(ii)		3,388		1,468
		3,388		1,468
Financial operations
Raízen Combustíveis S.A.(ii)		1,319		-
Rezende Barbosa Group(iii)		949		7,223
		2,268		7,223

		38,357		46,788

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Non-current assets
Receivables under the
framework agreement
Raízen Energia S.A.(ii)	104,984	305,183
Raízen Combustíveis S.A.(ii)	15,126	90,756
	120,110	395,939
Financial operations
Rezende Barbosa Group (iii)	84,996	107,002
Novvi Limited Liability Company	7,417	-
Other	4	-
	92,417	107,002
Corporate restructuring
CTC - Centro de Tecnologia Canavieira	-	1,540
	-	1,540

	212,527	504,481

Total	250,884	551,269

Current liabilities
Commercial operations
Shell Brazil Holding B.V.(i)	3,820	5,986
Raízen Energia S.A.(ii)	25,926	18,491
Raízen Combustíveis S.A.(ii)	1,283	1,709
Other	96	34
	31,125	26,220
Corporate operations / Agreements
Raízen Combustíveis S.A.(ii)	11,402	8,800
Raízen Energia S.A.(ii)	94,892	70,443
	106,294	79,243
Financial operations
Other	22	-
	22	-

	137,441	105,463

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Related party transactions:

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013
Sales of goods and services
Raízen Energia S.A.(ii)		303,395			279,185			299,676
Other		2,796			203			2
		306,191			279,388			299,678
Purchase of goods / Inputs
Raízen Energia S.A.(ii)		(109	)		(13	)		(63,605	)
Raízen Combustíveis S.A.(ii)		(741	)		(1,035	)		(546	)
		(850	)		(1,048	)		(64,151	)
Land lease
Raízen Energia S.A.(ii)		54,045			43,995			52,558
		54,045			43,995			52,558
Shared income (expense)
Aguassanta Participações S.A.		440			295			700
Raízen Energia S.A.(ii)		(33,555	)		(7,950	)		(14,683	)
		(33,115	)		(7,655	)		(13,983	)
Financial result
Raízen Energia S.A.(ii)		2,613			1,781			363
Rezende Barbosa Group(iii)		421			804			1,684
Impulso Participações		-			-			(976	)
Aldwich Temple Venture Capital Ltd.		(263	)		(153	)		(88	)
Other		269			113			(21	)
		3,040			2,545			962

Total		329,311			317,225			275,064

Commercial operations of Cosan with its subsidiaries, associates and joint ventures are carried out at prices and conditions similar to those practiced in the market. For the periods presented, no loss for doubtful accounts was recorded.

(i)

Shell

Relate to payables to Shell by COMGÁS in relation to a Commercial Services Agreement (CSA) – under which Shell agrees to provide commercial and business service staff for administrative support to conduct COMGÁS’s business.

(ii)

Raízen Energia and Raízen Combustíveis

Non-current assets receivable from Raízen Energia and Raízen Combustíveis are, primarily, tax credits which will be reimbursed to the Company when realized. Current liabilities represent payables in relation to expenses paid by Raízen Energia and Raízen Combustíveis to Cosan S.A.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

(iii)

Rezende Barbosa Group

The Company has receivables with Rezende Barbosa for the repayment of loans taken prior to the acquisition of the subsidiaries. These receivables are secured by Cosan S.A. shares.

Officers’ and directors’ compensation

Key management includes directors (executive and non-executive) and members of the board. The compensation paid or payable to key management for their services is shown below:

	Twelve months ended December 31, 2014		Nine months ended December 31, 2013		Twelve months ended March 31, 2013
Regular compensation		37,193		19,299		31,922
Stock option expense (Note 34)		12,924		6,595		13,295
Bonuses and other variable compensation		29,258		13,092		61,377

		79,375		38,986		106,594

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

12	Investments in associates

Information on associates of the Company and the Company´s ownership:

	Tellus Brasil Participações S.A.(i)			Novvi Limited Liability Company			Janus Brasil Participações S.A.(i)			Vertical UK LLP			Other			Total
Shares issued by the associate		65,957,282			200,002			1,364,827			-			-
Shares held by Cosan		33,638,214			100,001			689,685			-			-
Cosan ownership interest		51.00	%		50.00	%		51.00	%		50.00	%		-


At March 31, 2013		39,828			-			-			9,641			1,087			50,556
Equity in earnings (losses) of associates		14,825			(7,812	)		-			-			(1,516	)		5,497
Other comprehensive income		18			998			-			1,330			-			2,346
Dividends		(839	)		-			-			(2,845	)		-			(3,684	)
Capital increase		24,989			22,178			-			-			-			47,167
Other		-			-			-			-			1,434			1,434
At December 31, 2013		78,821			15,364			-			8,126			1,005			103,316
Equity in earnings (losses) of associates		9,657			(7,501	)		-			1,079			305			3,540
Other comprehensive income (losses)		204			2,019			-			(2,693	)		-			(470	)
Dividends		(3,118	)		-			-			-			-			(3,118	)
Capital increase		7,294			4,640			13,063			-			1,500			26,497
Other		1,559			-			-			-			(647	)		912

At December 31, 2014		94,417			14,522			13,063			6,512			2,163			130,677

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Financial information of associates:

	Twelve months ended December 31, 2014
	Assets		Liabilities		Equity		Profit (loss) for the period			Total comprehensive income


Tellus Brasil Participações Ltda.(i)		1,865,488		12,421		1,853,067		192,553			4,334
Janus Brasil Participações S.A.(i)		254,749		103		254,646		(1,483	)		-
Novvi Limited Liability Company		21,800		18,147		3,653		(14,847	)		4,038

	Nine months ended December 31, 2013
	Assets		Liabilities		Equity		Profit (loss) for the period			Total comprehensive income


Tellus Brasil Participações Ltda.(i)		1,664,607		119,130		1,545,477		290,686			2,263

	Twelve months ended March 31, 2013
	Assets		Liabilities		Equity		Profit (loss) for the period			Total comprehensive losses


Tellus Brasil Participações Ltda.(i)		800,479		22,459		778,020		124,079			(789	)

(i) The Company is entitled to 5.1% of the economic benefits of the associate as established in the shareholders agreement.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Information on the non controlling interest in subsidiaries of the Company:

	Cosan S.A. Indústria e Comércio S.A.			Companhia de Gás de São Paulo - "COMGÁS"			Cosan Logística S.A.			Rumo Logística Operadora Multimodal S.A.			Logispot Armazéns Gerais S.A.			Radar Propriedades Agrícolas S.A.			Radar II Propriedades Agrícolas S.A.			Elimination of participation Radar II in Radar			Other		Total
Shares issued by investee		407,214,353			121,870,985			405,856,814			956,917			2,040,816			21,148,989			830,690,258			-			-
Shares held by non-controlling shareholders		252,444,538			47,909,318			152,153,491			239,229			1,000,000			17,147,822			290,710,861			-			-
Non-controlling interest		37.49	%		39.31	%		37.49	%		25.00	%		49.00	%		81.08	%		35.00	%		-			-

At March 31, 2013		3,664,146			1,852,661			-			309,012			37,902			1,528,729			305,708			(489,457	)		-		7,208,701
Equity in earnings (losses)		88,270			162,793			-			40,273			(618	)		74,151			27,217			(14,718	)		-		377,368
Other comprehensive income (losses)		(2,457	)		9,817			-			-			-			7,345			516			(1,473	)		-		13,748
Dividends		(76,916	)		(64,357	)		-			-			-			(2,432	)		(5,249	)		368			-		(148,586	)
Other		(18,065	)		324			-			-			(65	)		-			-			65			-		(17,741	)
At December 31, 2013		3,654,978			1,961,238			-			349,285			37,219			1,607,793			328,192			(505,215	)		-		7,433,490
Equity in earnings (losses)		105,153			210,196			9,368			28,784			152			100,253			17,567			-			-		471,473
Other comprehensive income (losses)		(17,690	)		967			-			-			-			4,998			349			(234	)		-		(11,610	)
Dividends		(91,618	)		(65,715	)		(9,288	)		(54,379	)		-			(32,432	)		(8,365	)		6,504			-		(255,293	)
Other		2,229			4,892			(186	)		(54	)		(305	)		-			-			113			-		6,689

At December 31, 2014		3,653,052			2,111,578			(106	)		323,636			37,066			1,680,612			337,743			(498,832	)		-		7,644,749

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Summarized balance sheet

	Subsidiaries
	Companhia de Gás de São Paulo - "COMGÁS"						Rumo Logística Operadora Multimodal S.A.						Logispot Armazéns Gerais S.A.						Radar Propriedades Agrícolas S.A.						Radar II Propriedades Agrícolas S.A.
	Companhia de Gás de São Paulo - "COMGÁS"						Rumo Logística Operadora Multimodal S.A.						Logispot Armazéns Gerais S.A.						Radar Propriedades Agrícolas S.A.						Radar II Propriedades Agrícolas S.A.
	December 31, 2014			December 31, 2013			December 31, 2014			December 31, 2013			December 31, 2014			December 31, 2013			December 31, 2014			December 31, 2013			December 31, 2014			December 31, 2013
	December 31, 2014			December 31, 2013			December 31, 2014			December 31, 2013			December 31, 2014			December 31, 2013			December 31, 2014			December 31, 2013			December 31, 2014			December 31, 2013
Current
Assets		1,841,957			1,488,902			145,211			555,661			14,739			3,972			66,766			223,574			803			489
Liabilities		(1,497,373	)		(1,403,287	)		(368,401	)		(363,037	)		(6,179	)		(6,714	)		(16,744	)		(22,458	)		(202	)		-
Net current assets (liabilities)		344,584			85,615			(223,190	)		192,624			8,560			(2,742	)		50,022			201,116			601			489

Non-current
Assets		9,186,386			8,783,460			2,337,758			1,921,733			47,850			40,270			2,135,540			1,855,301			964,391			259,104
Liabilities		(3,658,708	)		(3,368,771	)		(820,026	)		(755,476	)		(32,358	)		(14,601	)		(44,899	)		(37,655	)		-			-
Net non-current assets		5,527,678			5,414,689			1,517,732			1,166,257			15,492			25,669			2,090,641			1,817,646			964,391			259,104

Equity		5,872,262			5,500,304			1,294,542			1,358,881			24,052			22,927			2,140,663			2,018,762			964,992			259,593

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Summarized statement of profit or loss and other comprehensive income

	Companhia de Gás de São Paulo - "COMGÁS"									Rumo Logística Operadora Multimodal S.A.									Logispot Armazéns Gerais S.A.
	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013			Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013			Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013



Net sales		6,387,104			4,888,897			2,398,989			905,449			742,962			706,020			21,354			12,122			22,743
Profit before taxes		734,945			560,443			207,314			172,678			243,201			223,261			2,168			2,664			6,316
Income tax expenses		(203,810	)		(152,740	)		(47,439	)		(58,151	)		(82,110	)		(74,677	)		(757	)		(894	)		(2,035	)
Profit for the period		531,135			407,703			159,875			114,527			161,091			148,584			1,411			1,770			4,281
Other comprehensive income		6,266			24,574			(84,017	)		-			-			-			-			-			-

Total comprehensive income		537,401			432,277			75,858			114,527			161,091			148,584			1,411			1,770			4,281

Comprehensive income attributable
to non-controlling interests		211,253			172,695			30,305			28,632			40,273			37,146			691			868			2,098

Dividends paid		65,715			-			79,299			-			-			-			-			-			-

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)


	Radar Propriedades Agrícolas S.A.									Radar II Propriedades Agrícolas S.A.
	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013			Twelve months ended December 31, 2014			Nine months ended December 31, 2013		Twelve months ended March 31, 2013



Net sales		43,883			14,433			19,828			-			-		-
Profit before taxes		164,365			94,783			190,256			50,217			15,240		42,371
Income tax expenses		(8,605	)		(3,320	)		(47,291	)		(20	)		-		(2	)
Profit for the period		155,760			91,463			142,965			50,197			15,240		42,369
Other comprehensive income		22,157			16,017			-			3,603			2,604		-

Total comprehensive income		177,917			107,480			142,965			53,800			17,844		42,369

Comprehensive income attributable
to non-controlling interests		144,255			87,145			115,916			18,830			6,245		14,829

Dividends paid		25,928			1,945			72,061			8,365			5,250		-

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Summarized statements of cash flows(I)

	Subsidiaries
	Companhia de Gás de São Paulo - "COMGÁS"									Rumo Logística Operadora Multimodal S.A.									Radar Propriedades Agrícolas S.A.
	Companhia de Gás de São Paulo - "COMGÁS"									Rumo Logística Operadora Multimodal S.A.									Radar Propriedades Agrícolas S.A.
	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013			Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013			Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013



Cash generated from operations		1,596,064			1,081,121			453,974			105,840			229,711			341,054			68,173			29,256			80,411
Income taxes paid		(111,970	)		(121,308	)		(174,038	)		(34,789	)		(2,064	)		(38,010	)		(10,219	)		(4.032	)		(10.049	)
Net cash generated by
operating activities		1,484,094			959,813			279,936			71,051			227,647			303,044			57,954			25,224			70,362

Net cash used in investing activities		(661,546	)		(610,418	)		(294,359	)		(262,876	)		(187,606	)		(265,591	)		(21,181	)		(24,070	)		(33,281	)

Net cash provided by
(used in) financing activities		(384,798	)		(140,942	)		(84,949	)		(230,292	)		(37,633	)		43,284			(40,000	)		(3,000	)		(88,883	)

Increase (decrease) in
cash and cash equivalents		437,750			208,453			(99,372	)		(422,117	)		2,408			80,737			(3,227	)		(1,846	)		(51,802	)

Cash and cash equivalents at
beginning of period		535,957			327,504			426,876			496,943			494,535			413,798			9,189			10,703			62,505

Cash and cash
equivalents at end of period		973,707			535,957			327,504			74,826			496,943			494,535			5,962			8,857			10,703

(I) Information presented for subsidiaries with significant non-controlling interest.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

13	Investment in joint ventures

In June 2011, the Company entered into an agreement to jointly control two companies:

(i)

Raízen Combustíveis which owns a network of, approximately, 5,356 fuel service stations throughout Brazil, 62 distribution terminals and 55 airports terminals for supplying aviation fuel;

(ii)

Raízen Energia, which produces and sell sugar, ethanol and renders electric energy cogeneration services, the latter mainly from sugar cane bagasse. Raízen Energia is responsible for the production of, approximately, 2 billion liters of ethanol per year to supply the domestic and foreign market, 4 million tons of sugar and 940 MW of installed capacity of electricity. Raízen Energia cultivates harvests and processes sugar cane - the main raw material used in the production of sugar and ethanol.

Cosan has joint control over Raízen Combustíveis and Raízen Energia by virtue of its 50% share in the equity of both companies and the requirement for unanimous consent by all shareholders over decisions related to the significant activities. The investments have been classified as joint ventures under IFRS 11 and therefore the equity method of accounting is used for all periods presented in these consolidated financial statements.

Changes to investments in joint ventures were as follows:

	Raízen Combustíveis S.A.			Raízen Energia S.A.(I)			Raízen Energia Participações S.A.(I)			Total
Shares issued by investee		3,303,168,484			5,902,595,634			5,902,595,634
Shares held by Cosan		1,651,584,242			2,951,297,817			2,951,297,817
Cosan ownership interest		50.00	%		50.00	%		50.00	%


At March 31, 2013		3,278,866			5,303,875			-			8,582,741
Equity in earnings
(losses) of joint ventures		352,515			(110,479	)		-			242,036
Other comprehensive income (losses)		(162	)		(3,156	)		-			(3,318	)
Dividends		(300,449	)		(20,000	)		-			(320,449	)
Other		(4,288	)		1,537			-			(2,751	)
At December 31, 2013		3,326,482			5,171,777			-			8,498,259
Equity in earnings of joint ventures		503,176			85,252			-			588,428
Other comprehensive income (losses)		(210	)		(44,322	)		-			(44,532	)
Dividends		(610,982	)		(26,912	)		-			(637,894	)
Other		-			242			-			242

At December 31, 2014		3,218,466			5,186,037			-			8,404,503

(I)

Raízen Energia was a direct subsidiary of Raízen Energia Participações S.A. ("REPSA") until November 30, 2012, at which time REPSA was merged into the company.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

The statement of financial position and statement of profit or loss of the joint ventures are disclosed in Note 5, Segments.

The cash flows and comprehensive income of the joint ventures are presented below:

	Raízen Energia S.A.									Raízen Combustíveis S.A.
	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013			Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013



Cash flow
Operating activities		3,200,792			490,313			2,659,558			682,720			559,917			1,456,774
Investing activities		(2,458,231	)		(1,456,505	)		(2,530,904	)		981			349,623			(478,335	)
Financing activities		842,905			265,174			430,364			(839,223	)		(719,261	)		(875,103	)

(Decrease) increase in cash
and cash equivalents		1,585,466			(701,018	)		559,018			(155,522	)		190,279			103,336

Other comprehensive
income (losses)		30,239			(214,998	)		293,170			1,078,945			721,444			790,724

Pursuant to the terms of the Raízen Joint Venture - Framework Agreement, Cosan is responsible for certain legal proceedings that existed prior to the formation of Raízen, net of judicial deposits as of April 1, 2011, as well as tax installments under the REFIS (tax amnesty and refinancing program), recorded in "Other taxes payable". Additionally, Cosan has access to a credit line (stand-by facility) granted to Raízen in the amount of US$500 million, which was unused at December 31, 2014.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

14	Assets held for sale and investment property

	Investment property			Assets held for sale			Total
At March 31, 2013		2,473,438			85,426			2,558,864
Additions		2,909			-			2,909
Change in fair value		125,322			(3,779	)		121,543
Transfers (i)		(314,104	)		314,104			-
Disposals		(6,056	)		(81,647	)		(87,703	)
At December 31, 2013		2,281,509			314,104			2,595,613
Change in fair value		112,579			19,118			131,697
Transfers(i)		247,890			(247,890	)		-
Disposals		-			(60,243	)		(60,243	)

At December 31, 2014		2,641,978			25,089			2,667,067

(i)

Land withdrawn from sale and reclassified back to investment properties as objectives not met in commercial negotiations.

Investment properties include agricultural land located in the Southeast, Midwest and Northeast regions of Brazil, which are leased to third parties and to joint ventures. The lease agreements for the cultivation of sugar cane have an average term of 18 and 10 years for grain.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

15	Property, plant and equipment

	Land, buildings and improvements			Machinery, equipment and facilities			Railcars and locomotives			Construction in progress			Other			Total
Cost
At March 31, 2013		435,832			318,480			433,158			206,534			31,872			1,425,876
Additions		97			6,155			-			246,251			28			252,531
Disposals		(52	)		(1,236	)		-			-			(376	)		(1,664	)
Transfers(i)		11,363			35,863			2,906			(168,523	)		3,576			(114,815	)
At December 31, 2013		447,240			359,262			436,064			284,262			35,100			1,561,928

Depreciation
At March 31, 2013		(71,079	)		(134,068	)		(31,361	)		-			(11,071	)		(247,579	)
Additions		(9,341	)		(20,151	)		(10,223	)		-			(2,937	)		(42,652	)
Disposals		1			156			-			-			51			208
Transfers(i)		-			67			-			-			(62	)		5
At December 31, 2013		(80,419	)		(153,996	)		(41,584	)		-			(14,019	)		(290,018	)

At March 31, 2013		364,753			184,412			401,797			206,534			20,801			1,178,297
At December 31, 2013		366,821			205,266			394,480			284,262			21,081			1,271,910

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

	Land, buildings and improvements			Machinery, equipment and facilities			Railcars and locomotives			Construction in progress			Other			Total
Cost
At December 31, 2013		447,241			359,263			436,065			283,937			35,417			1,561,923
Additions		114			5,830			-			382,737			-			388,681
Disposals		(1,726	)		(17,262	)		-			2			(2,076	)		(21,062	)
Transfers(i)		69,228			102,258			83,928			(411,359	)		4,261			(151,684	)
At December 31, 2014		514,857			450,089			519,993			255,317			37,602			1,777,858

Depreciation
At December 31, 2013		(80,418	)		(153,994	)		(41,584	)		-			(14,017	)		(290,013	)
Additions		(15,807	)		(36,810	)		(14,104	)		-			(4,710	)		(71,431	)
Disposals		1,388			16,147			-			-			1,948			19,483
Transfers(i)		(8,778	)		8,753			-			-			18			(7	)
At December 31, 2014		(103,615	)		(165,904	)		(55,688	)		-			(16,761	)		(341,968	)

At December 31, 2013		366,823			205,269			394,481			283,937			21,400			1,271,910
At December 31, 2014		411,242			284,185			464,305			255,317			20,841			1,435,890

(i) The balance of transfers relates to amounts reclassified to intangible assets.

Capitalization of borrowing costs

Capitalized borrowing costs in the year ended December 31, 2014 amounted to R$ 5,779 (nine months ended December 31, 2013 R$ 6,019; year ended March 31, 2013 R$ 6,593). The weighted average interest rate used to capitalize borrowing costs, that are directly attributable to the acquisition or construction of assets that take a substantial period of time to get ready, was 5.16% p.a. ended December 31, 2014 (5.96% p.a. for the nine months ended December 31, 2013; 5.60% p.a. year ended March 31, 2013).

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

16	Intangible assets

	Goodwill			Gas distribution concession - COMGÁS			Improvements to public concessions and operating licenses			Trademarks			Customer relationships			Other			Total
Cost
At March 31, 2013		705,816			7,742,140			618,878			252,474			597,193			143,535			10,060,036
Additions		-			557,220			-			-			125,408			40,960			723,588
Disposals		(1,860	)		(26,940	)		-			-			(3,415	)		(50	)		(32,265	)
Transfers(i)		-			-			132,677			-			-			16,380			149,057
Business combination		-			34,862			-			-			-			-			34,862
At December 31, 2013		703,956			8,307,282			751,555			252,474			719,186			200,825			10,935,278

Depreciation
At March 31, 2013		-			(127,048	)		(42,633	)		(97,012	)		(151,121	)		(27,324	)		(445,138	)
Additions		-			(197,233	)		(25,244	)		(17,120	)		(123,275	)		(34,101	)		(396,973	)
Disposals		-			17,844			-			-			1,276			-			19,120
Transfers(i)		-			-			(34,242	)		-			-			(5	)		(34,247	)
At December 31, 2013		-			(306,437	)		(102,119	)		(114,132	)		(273,120	)		(61,430	)		(857,238	)

At March 31, 2013		705,816			7,615,092			576,245			155,462			446,072			116,211			9,614,898
At December 31, 2013		703,956			8,000,845			649,436			138,342			446,066			139,395			10,078,040

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

	Goodwill		Gas distribution concession - COMGÁS			Improvements to public concessions and operating licenses			Trademarks			Customer relationships			Other			Total
Cost
At December 31, 2013		703,956		9,528,471			751,555			252,474			1,121,425			357,103			12,714,984
Additions		-		502,941			-			-			149,236			22,554			674,731
Disposals		-		(19,774	)		-			-			(6,773	)		(1	)		(26,548	)
Transfers(i)		-		(675	)		146,965			-			675			4,719			151,684
At December 31, 2014		703,956		10,010,963			898,520			252,474			1,264,563			384,375			13,514,851

Depreciation
At December 31, 2013		-		(1,527,626	)		(102,119	)		(114,132	)		(675,359	)		(217,708	)		(2,636,944	)
Additions		-		(343,956	)		(40,714	)		(22,830	)		(155,582	)		(45,684	)		(608,766	)
Disposals		-		13,898			-			-			3,420			(97	)		17,221
Transfers(i)		-		-			-			-			-			11			11
At December 31, 2014		-		(1,857,684	)		(142,833	)		(136,962	)		(827,521	)		(263,478	)		(3,228,478	)

At December 31, 2013		703,956		8,000,845			649,436			138,342			446,066			139,395			10,078,040
At December 31, 2014		703,956		8,153,279			755,687			115,512			437,042			120,897			10,286,373

(i) The balance of transfers relates to amounts reclassified to intangible assets.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Capitalization of borrowing costs

Capitalized borrowing costs in the year ended December 31, 2014, amounted to R$ 20,891 (nine months ended December 31, 2013 R$ 25,973; year ended March 31, 2013 R$ 7,279). The weighted average interest rate used to capitalize borrowing costs, that are directly attributable to the acquisition or construction of assets that take a substantial period of time to get ready, was 10.93% p.a. ended December 31, 2014 (8.40% p.a. for the nine months ended December 31, 2013; 8.32% p.a. year ended March 31, 2013).

Intangible assets (excluding goodwill)	Annual rate of amortization - %		December 31, 2014		December 31, 2013
Gas distribution concession - COMGÁS(i)	Concession term			8,153,279		8,000,845
Improvements to public rail concessions(ii)	Concession term			505,237		387,245
Operating license for port terminal(iii)		4.00		250,450		262,190
				755,687		649,435
Trademarks
Mobil		10.00		91,308		114,138
Comma		-		24,204		24,204
				115,512		138,342
Relationship with customers
COMGÁS		20.00		375,119		375,184
Lubricants		6.00		61,923		70,883
				437,042		446,067
Other
Software licenses		20.00		83,889		91,695
Other		-		37,008		47,700
				120,897		139,395

				9,582,417		9,374,084

(i)

Refers to the intangible asset for the public gas distribution service concession, which represents the right to charge users for the supply of gas, comprised of: (i) the concession rights recognized in the business combination and (ii) concession assets (Note 3). The amortization term is 39 years (the remaining concession period, plus extension);

(ii)

Refers to improvements made to the Federal Government rail network in relation to the transportation services provided by Rumo (Note 3); and

(iii)

Port operating license and customer relationships of Rumo, from the business combinations.

Impairment testing of cash-generating units containing goodwill

The Company tests the recoverable amounts of goodwill arising from business combination transactions annually. Property, plant and equipment and definite life intangible assets, that are subject to depreciation and amortization are tested for impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

During the year ended December 31, 2014, no impairment indicator was identified that would trigger the performance of an impairment test.

The combined carrying amounts of goodwill allocated to cash generating units are as follows:


	December 31, 2014		December 31, 2013
Cash-generating unit - Lubricants		603,462		603,462
Fair value less costs to spin-off - Rumo		100,451		100,451
Cash-generating unit - Other Businesses		43		43

Total goodwill		703,956		703,956

The recoverable amount is determined by reference to the value in use, using the discounted cash flows model, based on management’s estimated budget information which takes into consideration assumptions related to each business, using market available information as well as previous performance, and the fair value less costs to sell. Discounted cash flows are estimated for a period of 5 to 10 years and in perpetuity assuming a real growth rate of zero. Management considers it is appropriate to estimate cash flows for a period longer than five years as this reflects the estimated period of use of the asset groups and businesses involved.

The main assumptions and estimates involved are the following: (i) Rumo: the recoverable amount was determined by the fair value method, using as a basis the price that would be received to sell an asset or that would be paid by transferring a liability in an orderly transaction between market participants at the measurement date, (ii) Lubricants: expected growth in operations based on expected segmented GDP and other macroeconomic factors, as well as expected sales price of commodities.

Future cash flows are discounted using discount rates between 5.6% and 11.8% (weighted average cost of capital) that reflect specific risks relating to the significant assets in each cash-generating unit.

The impairment test performed as of December 31, 2014 did not result in the need to recognize impairment losses on the carrying value of intangible assets or goodwill. The determination of the recoverability of assets depends on certain key assumptions, as described above, which are influenced by current market, technological and economic conditions. These tests are not indicative of future impairment losses and/or whether they would be material.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

17	Loans and borrowings

	Interest
Description(i)	Index(ii)	Annual interest(iii)			December 31, 2014		December 31, 2013		Matures
Senior Notes Due 2023	US$		5.00	%		1,352,796		1,086,716	Mar-2023
Perpetual Notes	US$		8.25	%		1,344,760		1,186,221		-
Senior Notes Due 2018	Fixed		9.50	%		874,494		873,589	Mar-2018
BNDES	TJ462		7.80	%		834,565		525,636	Oct-2020
EIB	US$ + LIBOR		2.07	%		691,463		633,223	Sep-2021
Resolution 4131	US$ + LIBOR		2.72	%		466,494		413,477	Feb-2018
FINAME	URTJLP		6.93	%		457,570		428,916	May-2022
Non-convertible debentures	Fixed rate + IPCA		11.98	%		447,386		417,231	Sep-2020
FINAME	Fixed		4.04	%		307,230		277,298	Nov-2022
BNDES	TJLP		7.75	%		288,209		526,716	Oct-2018
BNDES	Selic		14.17	%		274,000		159,894	Oct-2020
Resolution 4131	US$ + LIBOR		1.59	%		266,006		-	Nov-2015
Foreign loans	LIBOR Sterling		3.88	%		224,047		209,340	Dec-2019
FINEP	Fixed		5.00	%		165,032		89,104	Nov-2020
Working capital	US$ + LIBOR		4.18	%		133,185		262,796	Sep-2016
Non-convertible debentures	CDI		11.81	%		131,229		164,144	Sep-2019
Working capital	CDI + 1.20%		12.91	%		101,515		-	Oct-2017
Working capital	CDI + 1.43%		13.17	%		85,628		-	Sep-2016
Resolution 4131	US$		1.18	%		29,338		-	Aug-2015
Finem	URTJLP		6.66	%		13,231		-	Jan-2022
Finem	IPCA		14.60	%		3,483		-	Nov-2021
Finem	Fixed		3.50	%		3,420		-	Jan-2024
Credit notes	110.00% CDI		-			-		393,646		-
Leasing	100.00%		-			-		1,068		-
Non-convertible debentures	123.00% CDI		-			-		1,443,941		-
Other			-			7,559		-		-
						8,502,640		9,092,956

Current						1,056,353		1,050,862
Non-current						7,446,287		8,042,094

(i)

Loans and borrowings are guaranteed by promissory notes and endorsements of the Company and controlling shareholders, besides other guarantees, such as: (i) credit rights originated from the expansion contracts of the logistic segment and gas distribution (BNDES), (ii) underlying assets (property, plant and equipment and intangible assets) being financed (FINAME) in an amount of R$1,738,661 (R$970,974 in 2013);

(ii)

TJLP and URTJLP are long-term interest rates on BNDES (Brazilian National Economic and Social Development Bank) loans. Selic is the benchmark interest rate set by the Brazilian Central Bank. CDI is a benchmark interbank lending rate in Brazil. IPCA is a benchmark consumer price index;

(iii)

As at December 31, 2014, unless otherwise indicated.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Non-current borrowings are scheduled to fall due as follows:

	December 31, 2014		December 31, 2013
13 to 24 months		751,980		595,917
25 to 36 months		944,817		666,297
37 to 48 months		1,874,414		650,006
49 to 60 months		672,319		1,626,221
61 to 72 months		435,042		1,101,334
73 to 84 months		79,978		1,071,570
85 to 96 months		4,535		65,043
Thereafter		2,683,202		2,265,706

		7,446,287		8,042,094

Senior Notes Due in 2018

On March 19, 2013, the Company issued Senior Notes in the international capital market under “Regulation S” and “Rule 144A” in the amount of R$ 850,000, bearing annual interest of 9.5%, payable semiannually in September and March of each year.

Senior Notes Due in 2023

On March 14, 2013, the Company issued Senior Notes in the international capital market under “Regulation S” and “Rule 144A” in the amount of US$ 500,000 thousand, bearing annual interest of 5%, payable semiannually in September and March of each year. Cross-currency interest rate swaps have been entered into to mitigate the Company’s exposure to interest rate and foreign exchange risks.

BNDES

Refers to the financing of expansion of the logistics segment and gas distribution.

Perpetual Notes

On November 5, 2010 and July 13, 2011 Cosan Overseas Limited issued US$ 500,000 thousand of perpetual notes in the international capital market under “Regulation S”, bearing annual interest of 8.25%, payable quarterly. Cross-currency interest rate swaps have been entered into to mitigate the Company’s exposure to interest rate and foreign exchange risks.

Bank debt – Working capital

On October 4, 2011, the Company entered into a bank loan agreement for US$ 100,000 thousand due in 2016, bearing annual interest of LIBOR + 4.58%. Proceeds were used to purchase the Company's own shares.

On September 3, 2013, the Company entered into a loan agreement for US$35,000 thousand due in 2016, bearing annual interest of LIBOR + 2.55%, LIBOR + 2.35% and LIBOR + 2.15%, for the first, second and third years, respectively.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

On October 28, 2014, the Company entered into a loan agreement for US$ 40,000 thousand (then equivalent to R$ 99,500) due in 2017, bearing annual interest of CDI + 1.20%. Proceeds were used to refinance part of the 2011 debt.

FINAME

Refers to FINAME funding (Federal Government Machinery and Equipment Financing Program), through various financial institutions, intended to be used for investments in property, plant and equipment and intangible assets. Interest is payable monthly and the principal is secured by liens on the financed assets.

Foreign currency loans

On December 22, 2014, Cosan Lubes Investment renegotiated its loan maturing in December 2019; including the grace period for the principal amount of two and a half years. The original loan was disbursed on June 29, 2012, for a principal amount of £ 54,000 thousand and was obtained in order to acquire control of Comma Oil and Chemicals Limited in July 2012.

EIB – European Investment Bank

Refers to loans denominated in U.S. Dollars, bearing interest at LIBOR and maturing in 2021. Cross-currency interest rate swaps have been entered into to mitigate the Company’s exposure to interest rate and foreign exchange risks. The funds were used to expand and support the natural gas distribution network.

Non-convertible debentures

On August 5, 2008, COMGÁS concluded the placement of a simple non-convertible debentures, indivisible at a par value of R$ 100,000. On August 2012, 2013 and 2014 the Company repaid accumulated total of 100% of the principal.

On September 15, 2013, COMGÁS concluded the placement of a three tranche non-convertible debentures, indivisible at par value totaling R$ 540,000. The final maturity is September, 2020.

In June 2014 Cosan pre-paid 100% of the principal of the debentures issued in 2012 in the total amount of R$ 1,400,000.

FINEP

In November 2012, Cosan Biomassa S.A. obtained a bank loan of R$ 89,694, maturing in January 2021. The same agreement provides for three more draw down installments, totaling R$ 254,890, bearing interest of 5% per year. These funds will be used for the development, production and marketing plan of new industrial technologies for the processing of biomass derived from sugar cane or other sources.

Promissory Notes

On March 1, 2013, COMGÁS concluded the issuance of 400 Promissory Notes at a par value of R$ 1,000, totaling R$ 400,000 with a maturity period of 270 days.

The amortization of the principal and interest occurred upon maturity.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Covenants

The Company and its subsidiaries are subject to certain restrictive financial covenants set forth in existing loans and financing agreements in relation to certain financial and non-financial indicators. Covenants are required to be calculated on an annual basis, at the end of each fiscal year.

As at December 31, 2014, Cosan, its subsidiaries and joint ventures were in compliance with all debt covenants.

The carrying amounts and fair value of loans and borrowings are as follows:

	Carrying amount				Fair value(i)
	December 31, 2014		December 31, 2013		December 31, 2014		December 31, 2013
	December 31, 2014		December 31, 2013		December 31, 2014		December 31, 2013
Senior / Perpetual Notes		3,572,050		3,174,894		3,356,788		2,977,658
Financing		4,930,590		5,918,062		4,930,590		5,918,062

Total		8,502,640		9,092,956		8,287,378		8,895,720

(i) Senior / Perpetual Notes and Financing were measured at fair value using Level “1” and “Level 2” inputs, respectively (Note 32).

The carrying amounts of loans and borrowings are denominated in the following currencies:

	December 31, 2014		December 31, 2013
	December 31, 2014		December 31, 2013
US Dollar		4,284,042		3,605,532
Brazilian Real		3,994,551		5,278,084
Pound Sterling		224,047		209,340

Total		8,502,640		9,092,956

18	Trade payables


	December 31, 2014		December 31, 2013
Natural gas suppliers		749,021		590,168
Materials and service suppliers		363,438		272,261

		1,112,459		862,429

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

19	Other taxes payable


	December 31, 2014		December 31, 2013
Tax Amnesty and
Refinancing Program - REFIS(I)		524,703		1,075,019
ICMS – State VAT		67,777		77,466
COFINS- Revenue tax		18,702		30,470
PIS - Revenue tax		2,511		5,170
INSS - Social security		2,739		2,842
Other		25,874		18,856
		642,306		1,209,823

Current		307,741		199,056
Non-current		334,565		1,010,767

(I)

Tax amnesty and refinancing program (REFIS) for the settlement of amounts due for qualifying Brazilian federal taxes.

Provisional Measure 651 was enacted through Law 13.043 on November 14, 2014 providing an option to join a Tax Amnesty and Refinancing Program (REFIS) to settle specified tax obligations by paying at least 30% in cash, utilizing tax loss carryforwards and reducing amounts owed for penalties and late payment interest accruals. Law 11.941/09 provided for similar benefits. The REFIS permitted the Company to settle tax obligations of R$ 578,182 (including unrecorded provisions related to possible tax loss contingencies of R$ 9,330) through cash payments of R$ 145,015, reduction of R$ 28,440 recognized as gain on REFIS liability and the offset of R$ 404,728 of tax loss carryforwards (being R$ 173,559 from the Company, including R$ 3,684 of unrecognized tax loss carryforwards, and R$ 231,168 from its joint ventures). The gain on REFIS liability was recorded in the statement of profit or loss in "Other expenses, net" (Note 29). The balance of tax obligations at December 31, 2014 of R$ 524,703 is subject to interest and indexation based on the SELIC index. The tax obligation and settlement process is still subject to final ratification by the tax authorities.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

20	Income tax and social contribution

Reconciliation of income and social contribution tax expenses

	Twelve months ended December 31, 2014			Nine months ended December 31, 2014			Twelve months ended March 31, 2013
Profit before taxes		686,308			539,180			920,886
Income tax and social contribution at
nominal rate (34%)		(233,345	)		(183,321	)		(313,101	)

Adjustments to reconcile nominal to effective tax rate
Equity method investments
(non taxable income)		201,269			84,161			229,270
Differences in tax rates on entities under
Brazilian presumed profits tax regime		51,398			38,922			40,841
Judicial demand related to income tax		13,839			-			-
REFIS discounts granted		9,972			-			-
Non taxable foreign exchange
gains of foreign subsidiaries		2,956			1,371			43,516
Differences in tax rates on
earnings / losses of overseas companies		2,465			(14,788	)		(9,141	)
Stock options		(4,400	)		(2,242	)		(4,521	)
Off-book tax loss carryforwards
now recorded (write-offs), net		(8,195	)		67,367			(60,994	)
Interest on capital (net received)		(13,380	)		(15,292	)		(19,531	)
Non-deductible expenses
(donations, gifts, etc.)		(19,232	)		(3,859	)		(3,944	)
Write off of tax loss
carryforwards - Partial spin-off (i)		(35,469	)		-			-
Other		(11,707	)		(11,513	)		(28,748	)

Income tax and social contribution
expense (current and deferred)		(43,829	)		(39,194	)		(126,353	)

Effective rate - %		6.39			7.27			13.72

(i) “Partial Spin-off” of Cosan S.A. and merger of the spun-off portion into Cosan Log (Note 1).

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Deferred income tax assets and liabilities


	December 31, 2014												December 31, 2013
	Basis			Income taxes (25%)			Social contribution (9%)			Total income taxes (34%)			Total income taxes (34%)


Tax loss carryforwards
Income tax loss carryforwards		1,276,670			319,168			-			319,168			282,656
Social contribution tax loss carryforwards		1,295,308			-			116,578			116,578			102,410

Temporary differences
Foreign currency gain / losses		892,613			223,153			80,335			303,488			11,603
Tax deductible goodwill		876,771			219,193			78,909			298,102			514,893
Provision for judicial demands		540,337			135,084			48,630			183,714			173,477
Allowance for doubtful accounts		157,015			39,254			14,131			53,385			54,258
Profit sharing		33,367			8,342			3,003			11,345			67,057
Derivatives instruments unrealized (gains) losses		(371,622	)		(92,905	)		(33,446	)		(126,351	)		107,489
Unrealized gain on sale of investments		(55,211	)		(13,803	)		(4,969	)		(18,772	)		(30,894	)
Other temporary differences		(98,207	)		(24,552	)		(8,839	)		(33,391	)		(17,390	)
Property, plant and equipment		(122,557	)		(30,639	)		(11,030	)		(41,669	)		(28,017	)
Gain on formation of joint ventures		(3,338,342	)		(834,585	)		(300,451	)		(1,135,036	)		(1,135,042	)
Unrealized gains on investment properties		(2,428,595	)		(48,572	)		(26,229	)		(74,801	)		(70,309	)
Assets held for sale		(25,090	)		(502	)		(271	)		(773	)		(9,636	)
Concession contract		44,284			11,071			3,986			15,057			11,579
Regulatory asset		242,654			60,664			21,839			82,503			118,228
Gains or losses on actuarial liabilities		257,630			64,407			23,187			87,594			41,593
Business combination - Property, plant and equipment		(107,629	)		(26,907	)		(9,687	)		(36,594	)		(38,098	)
Business combination - Intangible assets		(4,090,448	)		(1,022,612	)		(368,140	)		(1,390,752	)		(1,441,910	)
Business combination - Other fair value adjustments		(72,097	)		(18,024	)		(6,489	)		(24,513	)		(17,706	)
Other		(333,507	)		(83,376	)		(30,016	)		(113,392	)		(162,675	)
Total net liability					(1,116,141	)		(408,969	)		(1,525,110	)		(1,466,434	)

Deferred income tax - Assets											214,164			232,188
Deferred income tax - Liabilities											(1,739,274	)		(1,698,622	)

Total net deferred taxes											(1,525,110	)		(1,466,434	)

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Recoverability of deferred tax assets

In assessing the recoverability of deferred tax assets, management estimates future taxable income and the timing of reversal of the temporary differences.

Deferred income tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. Under Brazilian tax law, tax loss carryforwards do not expire, however, their use is limited to 30% of annual taxable income.

At December 31, 2014, the Company expects to realize deferred taxes on loss carry forwards on income tax and social contribution as follows:

	December 31, 2014
No later than 1 year		6,646
Later than 1 year and no later than 5 years		64,427
Later than 5 years		364,673

Total		435,746

Changes in deferred income taxes, net:

At March 31, 2013 – Net deferred tax liability	(1,545,908	)
Recorded through income	90,782
Recorded through other comprehensive income	(15,795	)
Securities	(4,668	)
Tax benefit of goodwill amortization	11,003
Other	(1,848	)
At December 31, 2013 – Net deferred tax liability	(1,466,434	)
Recorded through income	112,673
Recorded through other comprehensive income	(19,073	)
Acquisition cost of the preferred shares in subsidiaries	18,450
Use of tax loss carryforward - REFIS	(173,559	)
Other	2,833

At December 31, 2014 - Net deferred tax liability	(1,525,110	)

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

21	Provision for legal proceedings

	Provision for legal proceedings				Judicial deposits
	December 31, 2014		December 31, 2013		December 31, 2014		December 31, 2013
	December 31, 2014		December 31, 2013		December 31, 2014		December 31, 2013
Tax		343,038		410,890		319,444		294,991
Civil		139,268		146,011		48,445		33,659
Labor		175,473		165,557		50,496		32,904

		657,779		722,458		418,385		361,554

Changes in provision for legal proceedings:

	Tax			Civil			Labor			Total

At December 31, 2013		410,890			146,011			165,557			722,458
Accruals		11,962			12,882			86,241			111,085
Write-off / Reversals		(89,581	)		(9,303	)		(49,147	)		(148,032	)
Settlement		(1,070	)		(17,164	)		(31,902	)		(50,135	)
Indexation and interest charges		10,837			6,842			4,724			22,403

At December 31, 2014		343,038			139,268			175,473			657,779

Judicial claims deemed to be probable losses, fully accrued

Tax claims

	December 31, 2014		December 31, 2013
FINSOCIAL offsetting(i)		241,739		230,775
INSS - Social security(ii)		47,449		46,291
State VAT - ICMS credits(iii)		24,231		20,114
IPC - 1989(iv)		-		74,879
Other		29,619		38,831

		343,038		410,890

(i)

During the period from October 2003 to November 2006 Cosan Combustíveis e Lubrificantes S.A. “Cosan CL” offset the FINSOCIAL tax against several other federal taxes, based on a final court decision in September 2003 following a decision that challenged the constitutionality of the FINSOCIAL. No judicial deposits were made.

(ii)

Mainly related to social security contributions, which are being challenged on the grounds of constitutionality. Judicial deposits have been made for the corresponding amounts.

(iii)

A considerable portion of the amount accrued as ICMS was paid in cash under the provisions of Decree Nº 58,811 issued on December 27, 2012, which established the State of São Paulo Special Installment Program of ICMS (a.k.a. PEP-ICMS). The amounts that have been

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

provisioned refer to tax assessments by the tax authorities related to several types of ICMS credits. Amongst them: (a) assessment notice related to ICMS payments for the purchase of raw materials which are considered for “use and consumption”, therefore, not eligible for compensation; (b) assessment, as sole obligor, for withholding of ICMS on tolling agreement from an agricultural partnership with Central Paulista Ltda. Açúcar e Álcool.

(iv)

In 1993, CLE filed a lawsuit to challenge the balance sheet inflation accounting index (“IPC”) established by the Federal Government in 1989, considering that this index did not reflect the actual rate of inflation. The use of this index led the Company to overpay income and social contribution taxes. CLE obtained a favorable preliminary court ruling that allowed it to recalculate its financial position, using indices that better reflected the actual inflation over the period. In doing so the Company adjusted the amounts of income and social contribution taxes payable and offset the overpayments in subsequent years until 1997. Despite the favorable court rulings, the tax authorities issued a notice of infringement to the Company challenging all of the taxes that were offset. As the contingency is now considered to be a remote loss, the provision of R$ 75,144 was reversed, being the amounts of R$ 13,839 recorded under income tax expense and R$ 61,305 recorded under interest expenses.

Civil and environmental

The Company and its subsidiaries are party to a number of civil and legal claims related to (i) indemnification for material and moral damages, (ii) public civil claims related to burning of sugarcane stubble, and (iii) environmental matters.

The Company and its subsidiaries are also party to a number of labor claims filed by former employees and service providers challenging, among other things, unpaid overtime, night shift premiums and risk premiums, employment guarantees, and the reimbursement of withholdings from payroll such as social contributions and trade union charges.

Judicial claims deemed as possible losses, and therefore not accrued

Tax claims


	December 31, 2014		December 31, 2013
ICMS - State VAT(i)		1,572,934		1,291,685
Federal income taxes(ii)		751,495		726,815
PIS and COFINS - Revenue taxes(iii)		680,065		506,813
IRRF - Withholding tax(iv)		656,087		637,130
INSS - Social security and other(v)		530,223		508,053
IPI - Excise tax credit - NT(vi)		441,707		430,981
IPI offsetting - IN 67/98(vii)		118,865		115,004
Other		648,850		637,619

		5,400,226		4,854,100

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

(i)

ICMS

State VAT: Refers mainly to (i) tax assessments filed against the Company for unpaid ICMS and non-compliance with accessory obligations, in connection with the tolling services partnership with Central Paulista Açúcar e Álcool Ltda. in specified periods in 2006 and in 2007; (ii) ICMS levied on the remittances for the export of crystallized sugar, which the Company understands are tax exempted. However, the tax authorities, classify crystallized sugar as a semi-finished product, therefore subject to ICMS; (iii) penalties related to the withholding of ICMS taxes on the sale of ethanol to customers residing in other states; (iv) ICMS withholding rate differences on the sale of ethanol to companies located in other states, which subsequently had their tax registrations revoked; and (v) disallowance of ICMS tax credits on the sale of diesel fuel to customers engaged in the agro industrial business. The State Tax Administration understands that because the diesel fuel sold is for agricultural use, which is not Company’s core business, ICMS cannot be offset and (vi) ICMS payments on inventory differences arising from erroneous calculations by the State Tax Administration.

(ii)

Income taxes – Assessment notice

In December 2011, the Company received an assessment notice claiming unpaid income and social contribution taxes for the period from 2006 to 2009, for an amount of R$ 446,444 (September 2013). Such claim is based on the following: (i) tax benefits that arose from the deduction of goodwill amortization, (ii) the offsetting of tax carry forwards and (iii) taxes on revaluation differences of the property, plant and equipment. The Company filed its defense in January 2012 and has classified any potential loss as possible, consistent with the opinion of its legal advisors. The Company quantified such possible loss in the amount of R$ 221,780.

In June 2013, the Company received an assessment notice claiming unpaid income and social contribution taxes for the period from 2009 to 2011 of R$ 401,904, corresponding to the deduction of goodwill amortization. The Company challenged this assessment and has classified any potential loss as possible, consistent with the position of its legal advisors. The Company has quantified the possible loss in the amount of R$ 291,724 and a remote loss in the amount of R$ 110,180 in relation to the payment of fines.

(iii)

PIS and COFINS

Refers mainly to the reversal of PIS and COFINS credits, provided by Laws 10.637/2002 and 10.833/2003, respectively. Those reversals arise from a differing interpretation of the laws by the tax authorities in relation to raw materials. These discussions are still at the administrative level. There are also questions regarding the constitutionality of broadening the base of the PIS / COFINS conveyed by Law 9.718/98. The Supreme Court has already ruled on this issue, judging it unconstitutional.

(iv)

IRRF

In June 2013, the Company received an assessment notice issued for the payment of income tax withheld at source ("IRRF") in the amount of R$ 788,177. The withholding tax relates to an alleged capital gain arising from the acquisition of assets of companies located abroad. The Company presented its defense in July 2013 and, together with its legal advisors, rated the probability of loss as possible.

(v)

INSS – Social security

The legal proceeding related to INSS payment with possible unfavorable outcome involve the following:

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

(a) the legality and constitutionality questioning Normative Instruction MPS/SRP Nº 03/2005, which restricted the constitutional immunity over social contributions on export revenues through direct sales, consistent with the manner exports made via trading companies are now taxed; (b) assessment of SENAR (Rural apprenticeship scheme) social contribution on direct and indirect exports, in which the tax authorities disregard the right to constitutional immunity; (c) assessment of social security contribution on internal market resale of merchandises or to third parties, which are not included in the calculation of the social security contributions tax basis - these should only apply to gross revenue from production and not to acquired merchandise.

(vi)

IPI

Federal exercise VAT: SRF Normative Instruction no 67/98 approved the procedures adopted by industrial establishments which performed remittances without registration and payment of IPI, in relation to transfers of sugarcane carried out between July 6, 1995 and November 16, 1997 and of refined sugar between January 14, 1992 and November 16, 1997.

(vii)

Offsetting against IPI credits – IN 67/98

SRF Normative Instruction no. 67/98 allowed for the refunding of IPI tax payments for sales of refined sugar from January 14, 1992 through November 16, 1997. Consequently the Company applied for the offsetting of amounts paid during the periods against other tax liabilities. However, the tax authorities denied its application for both the reimbursement and offsetting of these amounts. The Company has challenged this ruling in an administrative proceeding.

Civil and labor

The main civil and labor claims for which unfavorable outcomes are deemed possible are as follow:

	December 31, 2014		December 31, 2013
Civil		1,118,151		832,311
Labor		391,992		502,697

		1,510,143		1,335,008

Receivables from legal proceedings

The Company recognized a gain of R$ 69,951 in December 2013 and R$ 318,358 in 2007, corresponding to a lawsuit filed against the Federal Government, claiming indemnification for the pricing of products, at the time when the industry was subject to government price control. Final judgment was passed in favor of the Company.

A gain was recognized in profit or loss of the corresponding year, with a corresponding receivable in “Other non-current assets”.

At December 31, 2014, the asset recorded for the indemnity lawsuit and corresponding provision for legal fees totaled R$460,103 and R$56,581 (R$496,009 and R$59,921 as at December 31, 2013), recorded in "other assets" and "other liabilities" respectively. Management is confident that the receipt of these amounts is virtually certain, as the Federal Government cannot appeal against the judgment. The fair value of the asset is equivalent to the carrying amount.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

22	Preferred shareholders payable in subsidiaries

On June 27, 2014, Cosan S.A. transferred to a newly-incorporated wholly-owned subsidiary, Cosan Investimentos e Participações S.A., its shares in Raízen Energia S.A. and Raízen Combustíveis S.A. in addition to a debenture Cosan S.A. had issued and placed with Banco Bradesco S.A.. The net assets transferred at that date totaled R$ 1,979,519.

Concurrently, also on June 27, 2014, Cosan S.A. executed an Investment Agreement with Fundo de Investimentos em Participações Multisetorial Plus II (“FIP Multisetorial”) and with Razac Fundo de Investimentos em Participações (“FIP Razac”). FIP Multisetorial and FIP Razac are funds owned by Banco Bradesco BBI S.A and Citibank Distribuidora de Títulos e Valores Mobiliários S.A., respectively. Pursuant to this agreement, FIP Multisetorial and FIP Razac subscribed and paid-in R$2,000,000 of non-voting preferred shares issued by Cosan Investimentos e Participações S.A.. These preferred shares will be remunerated based on a formula designed to provide a return over 15 years equivalent to the CDI rate. In the event the accumulated remuneration falls short of the minimum amount prescribed in the formula, as at April 30, 2021, the preferred shareholders will have a put against Cosan S.A. for an amount equivalent to the value of the initial investment plus interest based on the CDI less any CDI-indexed dividends paid.

The investment in the net assets of in the joint ventures, Raízen Energia S.A. and Raízen Combustíveis S.A., continue to be accounted for on the equity method without affecting the Company’s 50% interest in the results of each venture. The transaction underlying the Investment Agreement has been classified as a noncurrent financial liability in Cosan´s and Cosan S.A.´s balance sheet and the statement of profit or loss reflects the CDI equivalent dividends classified as financial expenses.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

23	Stockholders’ Equity

Share capital

As of December 31, 2014 Cosan Limited’s share capital is composed of the following:

Shareholders - Common shares	Class A and / or BDRs		%		Class B1 shares		%
Queluz Holding Limited		5,906,611		3.39		66,321,766		68.85
Usina Costa Pinto S.A. Açúcar e Álcool		-		-		30,010,278		31.15
Gávea Funds		21,167,463		12.14		-		-
Blackrock Inc.		8,559,101		4.91		-		-
MSOR Participações S.A.		1,811,250		1.04		-		-
Usina Bom Jesus S.A.		255,000		0.15		-		-
FIA Rio das Pedras		16,000		0.01		-		-
Other		130,643,414		74.93		-		-
Total shares outstanding		168,358,839		96.56		-		-

Treasury shares		5,996,502		3.44		-		-

Total		174,355,341		100.00		96,332,044		100.00

There have been no changes to the number of shares in issue during the periods presented.

Class B1 shares entitle the holder to 10 votes per share whereas Class A and BDRs’ shares are entitled to one vote per share.

Treasury shares

The Company holds 5,996,502 Class A treasury shares as of December 31, 2014 and 2013 with a market value of US$7.75 per share at December 31, 2014 (US$13.72 per share at December 31, 2013).

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Other comprehensive income

	March 31,			Comprehensive			March 31,			Comprehensive			December 31,			Comprehensive			December 31,
	2012			income			2013			income			2013			income			2014
Foreign currency translation differences		(182,730	)		2,583			(180,147	)		(42,891	)		(223,038	)		(75,406	)		(298,444	)
Gain (loss) on cash
flow hedge in joint ventures and subsidiary		14,115			35,695			49,810			(6,426	)		43,384			(53,956	)		(10,572	)
Revaluation of investment properties reclassified
from property, plant and equipment		-			190,735			190,735			-			190,735			-			190,735
Defined benefit plan actuarial losses		22,570			(34,487	)		(11,917	)		28,009			16,092			31,012			47,104
Changes in value of available for
sale securities, net		(23,689	)		7,132			(16,557	)		9,077			(7,480	)		5,932			(1,548	)

Total		(169,734	)		201,658			31,924			(12,231	)		19,693			(92,418	)		(72,725	)

Attributable to:
Owners of the parent		(176,500	)		117,592			(58,908	)		(25,979	)		(84,887	)		(80,727	)		(165,614	)
Non-controlling interests		6,766			84,066			90,832			13,748			104,580			(11,691	)		92,889

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

24	Earnings per share

The calculation of basic earnings per share has been made by dividing the profit attributable to shareholders of the parent by the weighted-average number of ordinary shares outstanding during the year excluding ordinary shares purchased by the company and held as treasury shares (Note 23.a).

The calculation of diluted earnings per share has been made by dividing the profit attributable to shareholders of the parent, adjusted to assume conversion of all dilutive potential ordinary shares at subsidiaries by the weighted-average number of shares outstanding during the year excluding ordinary shares purchased by the company and held as treasury shares (Note 23.a). The Company’s subsidiaries have two categories of potential dilutive effects: share options and put options. For the share options, a calculation is done to determine the effect of the dilution in the profit attributable to shareholders of the parent due the exercise of the share options at subsidiaries. For the put option, is assumed to have been converted into ordinary shares, and the profit attributable to shareholders of the parent is adjusted.

The average market value of the subsidiaries' shares for the purpose of calculating the dilutive effect of shares options was based on quoted market prices for the period during which the options were outstanding.

The following table sets forth the calculation of earnings per share for the year ended December 31, 2014, nine months ended December 31, 2013 and year ended March 31, 2013 (in thousands of Brazilian Reais, except per share amounts):

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013
Numerator
Profit from continuing operations
Basic		171,006			122,618			337,521
Dilutive effect of subsidiary's
stock option plan		(1,212	)		(918	)		(1,904	)
Dilutive effect of put option		(15,601	)		(15,601	)		(15,601	)
Diluted		154,192			106,099			320,016

Profit from discontinued operations
Basic		-			-			86,549
Dilutive effect of subsidiary's
stock option plan		-			-			(421	)
Diluted		-			-			86,128

Denominator
Weighted average number
of shares outstanding		264,690,883			264,690,883			264,842,445

Basic earnings per share
Continuing operations	R$	0.65		R$	0.46		R$	1.27
Discontinued operations		-			-		R$	0.33
	R$	0.65		R$	0.46		R$	1.60
Diluted earnings per share
Continuing operations (as revised – Note 4.2)	R$	0.58		R$	0.40		R$	1.21
Discontinued operations		-			-		R$	0.33
	R$	0.58		R$	0.40		R$	1.54

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

25	Commitments

Commitments for the acquisition of assets and regulatory targets

COMGÁS has contractual commitments for the acquisition of intangible assets of R$ 13,257 at December 31, 2014 (R$ 23,687 at December 31, 2013) for the support and administration of the gas distribution network, as well as administrative and technology costs.

Lease agreements

Lessor

Radar leases agricultural land to third parties for the production of sugar cane and grains.

The minimum lease receivables of these operating leases are calculated based on data from the TRS, and other commodity prices, and harvested volume per hectare as defined in contract. Revenues related to these contracts at December 31, 2014 are as follows:

2015			66,008
2016			65,771
2017			65,480
2018			53,277
2019			53,277

			303,813

Lessee

At December 31, 2014, future minimum lease payments on non-cancellable operating leases entered by Rumo are as follows:

	2014		2013
No later than 1 year		56,608		52,173
Later than 1 year and no later than 5 years		268,077		263,642

		324,685		315,815

COMGÁS rents properties through 15 lease contracts. Rental expense amounted to R$ 4,639 for the year ended December 31, 2014 (R$ 5,741 for the nine months ended December 31, 2013 and R$ 1,510 for the year ended March 31, 2013).

The lease terms are for a period of one to six years, and the majority of lease agreements are renewable at the end of the lease period at market rates.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Future minimum lease payments under non-cancelable operating leases are as follows:

	2014		2013
No later than 1 year		4,080		4,799
Later than 1 year and no later than 5 years		6,233		9,413

		10,313		14,212

Purchase

Rumo has contractual commitments totaling R$22,000 for the improvement of the railway network to expand the logistics segment through 2015.

Gas purchase

COMGÁS has take-or-pay purchase contracts, effective through December 2019, with gas suppliers which establish minimum daily purchases of gas volumes. Were the Company to consume a volume of gas below its contractual obligation, the Company would be required to pay for the shortfall between consumption and the required minimum contractual volumes; however, it could recover this credit (through consumption) over the remaining contract period. Amounts paid but not consumed by COMGÁS were recognized as “Other assets” in the statement of financial position (2014: R$ 163,686; 2013: R$ 133,823).

Regulatory assets (liabilities)


	December 31, 2014			December 31, 2013
Cost of gas to be recovered/(transferred)		243,713			345,349
Credits of taxes to be recovered/(transferred)		(1,120	)		2,517
Adjustment to present value of taxes		61			(137	)

		242,654			347,729


Opening balance		347,729			380,894
Closing balance		242,654			347,729

Expense not recognized in the statement of
profit and loss before income tax and social contribution		(105,075	)		(33,165	)


Regulatory assets (liabilities)		(124,495	)		(59,173	)
Adjustment		26,359			34,376
Other		(6,939	)		(8,368	)
		(105,075	)		(33,165	)

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

The tariffs for the supply of gas to the different customer segments are authorized by the concession authority. In accordance with the terms of the Concession Agreement, the differences between the cost component of gas included in the tariffs charged to the customers and the actual cost of gas incurred are determined on a monthly basis and charged or credited to a regulation account (regulatory account).

Periodically, charges or credits in the tariffs are determined by the regulator with the objective of amortizing the amounts accumulated in this account.

The balance of this account is considered as an asset or as a liability, pursuant to the regulator's set of accounts and for income tax purposes. However, this account is not recognized under IFRS, because the respective balance is not considered as an asset or as a liability, as its realization or liquidation depends on further purchases by the Company's consumers. Therefore, the balances presented above are not recorded in these financial statements.

26	Gross Sales

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013
Gross revenue from sales of products		9,702,960			7,133,290			4,686,403
Gross revenue from sales of services		1,000,065			845,100			809,667
Construction revenue		481,314			536,482			230,038
Indirect taxes and deductions		(2,122,035	)		(1,636,658	)		(1,139,899	)

Net revenue		9,062,304			6,878,214			4,586,209

27	Expenses by nature

The expenses are presented in the statement of profit and loss by function. The reconciliation of income by nature/purpose for the year ended December 31, 2014, nine months ended December 31, 2013, and year ended March 31, 2013 are as follows:

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013
Raw materials and consumables used		(4,767,550	)		(3,533,382	)		(2,725,069	)
Employee benefit expense		(1,334,341	)		(1,021,922	)		(430,930	)
Transportation expenses		(887,608	)		(666,461	)		(260,376	)
Depreciation and amortization(I)		(662,196	)		(424,580	)		(317,270	)
Selling expenses		(60,906	)		(76,067	)		(169,423	)
Other		(251,275	)		(226,714	)		(187,207	)

		(7,963,876	)		(5,949,127	)		(4,090,275	)

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Classified as:

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013


Cost of sales		(6,413,720	)		(4,878,229	)		(3,211,309	)
Selling		(881,543	)		(603,965	)		(459,433	)
General and administrative(1I)		(668,613	)		(466,933	)		(419,533	)

		(7,963,876	)		(5,949,127	)		(4,090,275	)

(I)

Excludes R$16,913 presented as a deduction of net revenue (December 31, 2013 R$14,564 and March 31, 2013 R$17,516);

(II)

Research and development expenses for the year ended December 31, 2014 was R$4,969 (December 31, 2013 R$ 2,180).

28	Financial results

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013
Financial expense
Interest expense		(994,685	)		(769,852	)		(568,903	)
Indexation expenses		(66,117	)		(34,754	)		(9,102	)
		(1,060,802	)		(804,606	)		(578,005	)
Financial income
Interest income		54,316			70,094			72,491
Indexation income		23,089			10,648			7,845
Income from short term investments		139,707			99,162			83,327
		217,112			179,904			163,663
Foreign exchange effects, net(I)
Foreign exchange losses, net		(300,521	)		(324,495	)		(83,254	)
		(300,521	)		(324,495	)		(83,254	)
Derivative income (losses)
Commodities - derivatives		1,353			-			-
Foreign exchange and interest rate derivatives		160,009			235,485			9,253
Warrants in associates		-			-			65,230
		161,363			235,485			74,483

		(982,848	)		(713,712	)		(423,113	)

(I) Includes gains (and losses) on foreign exchange rates relating to assets and liabilities denominated in foreign currency.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

29	Other income (expenses), net

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013
Changes in the fair value of
investment properties		131,697			121,543			138,776
Gain on port operations		9,628			5,687			-
Rental income		399			519			347
(Loss) gain on disposal of
non-current assets		(10,836	)		(7,788	)		97,370
Provisions for legal proceedings		(51,347	)		(94,571	)		(65,426	)
Gain on settlement of REFIS liability		28,440			-			-
Cost related to internal organization and prospective acquisitions (i)		(134,614	)		-			-
Other		5,393			50,882			2,672

		(21,240	)		76,272			173,739

(i) Relates to costs incurred by the Company with lawyers, consultants, business advisors and other related services for certain reorganizations and prospective acquisitions.

30	Discontinued operations

The Company signed an agreement with Camil to sell all the shares issued by a former subsidiary (Note 10 (b)).

Pursuant to IFRS 5 - Non-current assets available for sale and discontinued operations, the results of this subsidiary are presented as "Discontinued Operations" in the statement of profit or loss.

31	Financial instruments

Financial risk management

Overview

The Company is exposed to the following risks related to the use of financial instruments:

Foreign exchange risk;

Interest rate risk;

Credit risk; and

Liquidity risk.

This note presents information about the exposure of the Company and its subsidiaries to the above risks, as well as the objectives of the Company's risk management policies, these policy and processes for the assessment and management of risks.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Risk management structure

The risks inherent to each type of business market are managed and monitored by the Company and, where applicable, risk committees are convened to discuss and determine the hedging strategy of the Company in accordance with its policies and guidelines.

COMGÁS maintains a Treasury policy, approved by the Board, which is revised periodically and determines the standardization and the purpose of the financial operations of the Company. In addition, this policy determines the methodology to evaluate the counterparty’s credit risk (foreign exchange transactions, derivatives, financial investments and guarantees) and stipulate what are the financial instruments that are allowed to be used.

The risk management associated with financial transactions is performed through the application of the Treasury policy and strategies defined by the administrators of the Company. These rules provide the guidelines for the management of risks, their measurement, how to mitigate risks, forecast cash flows and also establishes exposure limits. As such, all financial operations contracted should be the best alternatives, financially and economically, and should not be entered into with speculative purposes, therefore, a financial exposure should exist to justify all financial operations.

The usage of financial instruments in order to protect against these areas of volatility is determined through an analysis of the risk exposure that management intends to cover.

As at December 31, 2014 and 2013, the fair values relating to transactions involving derivative financial instruments to protect the Company’s risk exposure were using observable inputs such as quoted prices in active markets, or discounted cash flows based on market curves, and are presented below:

	Notional				Fair value
	December 31, 2014		December 31, 2013		December 31, 2014			December 31, 2013			P&L
	December 31, 2014		December 31, 2013		December 31, 2014			December 31, 2013			P&L
COMGÁS derivatives
Exchange rate derivatives
Swap agreements		828,443		828,443		330,098			209,532			330,099
		828,443		828,443		330,098			209,532			330,099

Other subsidiaries derivatives
Exchange rate derivatives
Forward agreements		178,127		232,218		21,250			25,713			21,250
Options		-		-		(8,842	)		-			(8,842	)
		178,127		232,218		12,408			25,713			12,408




Interest rate and exchange rate risk
Swap agreements (interest rate)		221,560		181,617		(40,329	)		(13,573	)		(40,329	)
Cross currency interest rate swaps		1,659,904		1,662,806		254,966			(39,079	)		254,966
		1,881,464		1,844,423		214,637			(52,652	)		214,637

Total financial instruments						557,144			182,593			557,144

Assets						890,578			513,934
Liabilities						(333,435	)		(331,341	)

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Foreign exchange risk

The table below presents the derivatives used to mitigate exchange rates risks:

Derivatives	Purchased / Sold		Market	Agreement	Maturity date	Notional (US$)			Notional (R$ thousand)			Fair Value (R$ thousand)
Derivatives designated as hedge accounting:
Contracted by other subsidiaries
Swap		N/A	OTC	Swap	Mar-23		175,000			347,690			2,458
Swap		N/A	OTC	Swap	Mar-23		50,000			106,595			29,220
Swap		N/A	OTC	Swap	Mar-23		50,000			106,595			29,609
Swap		N/A	OTC	Swap	Mar-23		368,500			732,136			(23,964	)
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			(8,853	)
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			16,383
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			(10,628	)
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			18,076
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			17,935
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			(10,691	)
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			17,512
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			(10,155	)
Swap		N/A	OTC	Swap	Mar-23		50,000			110,780			17,012
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			8,498
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			8,599
Swap		N/A	OTC	Swap	Mar-23		75,000			167,775			228
Swap		N/A	OTC	Swap	Mar-23		50,000			106,595			20,823
Swap		N/A	OTC	Swap	Mar-23		50,000			110,780			15,916
Swap		N/A	OTC	Swap	Mar-23		25,000			55,390			8,145
Swap		N/A	OTC	Swap	Mar-23		10,000			21,319			3,810
Swap		N/A	OTC	Swap	Mar-23		65,000			144,014			22,335
Swap		N/A	OTC	Swap	Mar-23		(368,500	)		(732,136	)		23,964
Swap		N/A	OTC	Swap	Mar-23		(175,000	)		(347,690	)		(2,459	)
Swap	Amortization Gain/Loss D1						-			-			1,832

At December 31, 2014							675,000			1,483,743			195,605
At December 31, 2013							675,000			1,483,743			(45,025	)

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Forward	Purchased		OTC	Deliverable forward	Jan-15	467	1,208	(32	)
Forward	Purchased		OTC	Deliverable forward	Jan-15	316	816	(22	)
Forward	Purchased		OTC	Deliverable forward	Jan-15	4,158	10,756	(287	)
Forward	Purchased		OTC	Deliverable forward	Jan-15	419	1,084	(29	)
Forward	Purchased		OTC	Deliverable forward	Jan-15	894	2,312	(62	)
Forward	Purchased		OTC	Deliverable forward	Jan-15	206	533	(14	)
Forward	Purchased		OTC	Deliverable forward	Jan-15	512	1,323	(35	)
Forward	Purchased		OTC	Deliverable forward	Jan-15	3,616	9,354	(250	)
Forward	Purchased		OTC	Deliverable forward	Jan-15	830	2,147	(57	)
Forward	Purchased		OTC	Deliverable forward	Jan-15	1,901	5,087	37
Forward	Purchased		OTC	Deliverable forward	Jan-15	259	693	5
Forward	Purchased		OTC	Deliverable forward	Jan-15	89	237	2
Forward	Purchased		OTC	Deliverable forward	Jan-15	864	2,312	17
Forward	Purchased		OTC	Deliverable forward	Jan-15	355	949	7

At December 31, 2014						14,886	38,811	(720	)
At December 31, 2013						-	-	-

Total at December 31, 2014						689,886	1,522,554	194,885
Total at December 31, 2013						675,000	1,483,743	(45,025	)

Derivatives not designated as hedge:
Contracted by COMGÁS
Swap		N/A	OTC/CETIP	Cross Cur Swap	Jul-17	75,000	153,900	37,650
Swap		N/A	OTC/CETIP	Cross Cur Swap	Feb-18	50,000	99,385	29,309
Swap		N/A	OTC/CETIP	Cross Cur Swap	Aug-18	50,000	115,000	13,994
Swap		N/A	OTC/CETIP	Cross Cur Swap	Jun-20	10,000	18,361	8,059
Swap		N/A	OTC/CETIP	Cross Cur Swap	Jun-20	10,000	18,361	8,454
Swap		N/A	OTC/CETIP	Cross Cur Swap	Jun-20	10,000	18,361	8,231
Swap		N/A	OTC/CETIP	Cross Cur Swap	Jun-20	14,381	26,406	11,830
Swap		N/A	OTC/CETIP	Cross Cur Swap	Jun-20	40,000	73,444	32,750
Swap		N/A	OTC/CETIP	Cross Cur Swap	Sep-20	39,922	69,580	34,067
Swap		N/A	OTC/CETIP	Cross Cur Swap	May-21	51,400	83,145	52,610
Swap		N/A	OTC/CETIP	Cross Cur Swap	May-21	20,000	32,352	20,646
Swap		N/A	OTC/CETIP	Cross Cur Swap	Sep-21	30,000	49,761	29,886
Swap		N/A	OTC/CETIP	Cross Cur Swap	Sep-21	42,435	70,387	42,612

At December 31, 2014						443,138	828,443	330,098
At December 31, 2013						443,138	828,443	209,532

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Financial instruments contracted by other subsidiaries
Forward	Purchased		OTC	NDF	Feb-15	6,188		14,497		1,996
Forward	Purchased		OTC	NDF	Feb-15	4,197		8,813		2,363
Forward	Purchased		OTC	NDF	Feb-15	1,529		3,915		186
Forward	Purchased		OTC	NDF	Feb-15	1,618		3,929		408
Forward	Purchased		OTC	NDF	Feb-15	1,817		4,338		529
Forward	Purchased		OTC	NDF	Feb-15	1,586		3,890		360
Forward	Purchased		OTC	NDF	Feb-15	1,520		3,604		468
Forward	Purchased		OTC	NDF	Feb-15	1,761		4,229		489
Forward	Purchased		OTC	NDF	Feb-15	1,654		3,863		567
Forward	Purchased		OTC	NDF	Feb-15	1,652		4,133		297
Forward	Purchased		OTC	NDF	Feb-15	1,631		4,317		60
Forward	Purchased		OTC	NDF	Feb-15	1,419		3,875		(67	)
Forward	Purchased		OTC	NDF	Feb-15	1,395		3,668		77
Forward	Purchased		OTC	NDF	May-15	6,188		14,726		2,130
Forward	Purchased		OTC	NDF	May-15	4,197		8,942		2,449
Forward	Purchased		OTC	NDF	Aug-15	6,188		15,003		2,220
Forward	Purchased		OTC	NDF	Aug-15	4,197		9,089		2,516
Forward	Purchased		OTC	NDF	Nov-15	6,188		15,254		2,334
Forward	Purchased		OTC	NDF	Nov-15	4,197		9,231		2,588

At December 31, 2014						59,122		139,316		21,970
At December 31, 2013						102,974		232,218		25,713

Swap		N/A	OTC	Swap	Aug-15	11,000		24,846		2,761
Swap		N/A	OTC	Swap	Nov-15	100,000		253,500		6,059
Swap		N/A	OTC	Swap	Sep-16	50,000		119,375		10,212
Swap		N/A	OTC	Swap	Mar-18	359,272		712,796		254,714
Swap		N/A	OTC	Swap	Mar-18	(359,272	)	(712,796	)	(254,714	)

At December 31, 2014						161,000		397,721		19,032
At December 31, 2013						156,972		360,680		(7,627	)

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Option	Purchased	OTC	CALL	Mar-15	50,000	142,500	1,397
Option	Sold	OTC	PUT	Mar-15	50,000	133,075	(2,577	)
Option	Purchased	OTC	CALL	Mar-15	50,000	142,500	1,397
Option	Sold	OTC	PUT	Mar-15	50,000	132,400	(2,281	)
Option	Purchased	OTC	CALL	Mar-15	50,000	142,500	1,397
Option	Sold	OTC	PUT	Mar-15	50,000	131,540	(1,934	)
Option	Purchased	OTC	CALL	Mar-15	50,000	142,500	1,397
Option	Sold	OTC	PUT	Mar-15	50,000	131,660	(1,975	)
Option	Purchased	OTC	CALL	Mar-15	50,000	142,500	1,397
Option	Sold	OTC	PUT	Mar-15	50,000	135,100	(3,598	)
Option	Purchased	OTC	CALL	Mar-15	50,000	142,500	1,397
Option	Sold	OTC	PUT	Mar-15	50,000	135,125	(3,610	)
Option	Purchased	OTC	CALL	Mar-15	50,000	142,500	1,397
Option	Sold	OTC	PUT	Mar-15	50,000	132,025	(2,123	)
Option	Purchased	OTC	CALL	Mar-15	50,000	142,500	1,397
Option	Sold	OTC	PUT	Mar-15	50,000	131,500	(1,920	)

At December 31, 2014					800,000	2,202,425	(8,842	)
At December 31, 2013					-	-	-

Total at December 31, 2014					1,463,260	3,567,905	362,259
Total at December 31, 2013					703,084	1,421,341	227,618

As at December 31, 2014 and 2013, the Company and its subsidiaries had the following net exposure to the exchange rate variations on assets and liabilities denominated in U.S. Dollars and Pounds Sterling:

	December 31, 2014			December 31, 2013
Cash and cash equivalents		95,017			61,262
Trade receivables		25,323			24,453
Loans and borrowings		(4,508,089	)		(3,791,773	)

Foreign exchange exposure, net		(4,387,749	)		(3,706,058	)

Interest rate risk

The Company and its subsidiaries monitor the fluctuations in variable interest rates in connection with its borrowings, especially those that accrue interest using LIBOR, and uses derivative instruments in order to minimize variable interest rate fluctuation risks.

Credit risk

COMGÁS has no concentration of credit risk due to its broad customer base.

Credit risk is managed through specific rules regarding client acceptance, including credit ratings and limits for customer exposure, including the requirement for a letter of credit from a major bank and obtaining actual warranties when given credit, when applicable. Management believes that credit risk is adequately managed through its policy of allowances for doubtful accounts.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

The Company and its subsidiaries may acquire exchange rate and interest rate derivative instruments in the BM&FBovespa, OTC, registered CETIP or the international markets, with several banks, within the limits established in the Treasury Policy for each bank.

The credit risk on cash and cash equivalents, bank deposits in national and foreign financial institutions are determined using the rating instruments accepted by the market as follows:

	Investment securities (Unaudited)
AAA		997,915
AA		501,124

At December 31, 2014		1,499,039

Liquidity risk

Liquidity risk is the risk that the Company and its subsidiaries will not be able to meet its obligations associated with its financial liabilities that are settled with cash payments or other financial assets. The Company and its subsidiaries manage liquidity risk by ensuring, as much as possible, the availability of sufficient liquidity to meet its obligations due, under normal and stress situations, without causing unacceptable losses or risking the Company’s and its subsidiaries reputation.

The Company’s non-derivative financial liabilities classified by due date (contracted undiscounted cash flows basis) are as follows.

	December 31, 2014															December 31, 2013
	Up to 1 year			1 -2 years			3 – 5 years			More than 5 years			Total			Total
	Up to 1 year			1 -2 years			3 – 5 years			More than 5 years			Total			Total
Loans and borrowings		(1,253,138	)		(1,113,343	)		(6,476,717	)		(6,145,643	)		(14,988,841	)		(10,996,388	)
Trade payables		(1,034,282	)		-			-			-			(1,034,282	)		(862,429	)
REFIS payable		(190,139	)		(1,124	)		(688	)		(332,753	)		(524,704	)		(1,010,767	)

Total		(2,477,559	)		(1,114,467	)		(6,477,405	)		(6,478,396	)		(16,547,827	)		(12,869,584	)

Hedge accounting – Fair Value

To mitigate risks to the Company from potential fluctuations in foreign exchange rates and interest rates, the Company entered into certain derivative contracts that were designated for hedge accounting (fair value hedge) as of July 1, 2013, for the "2023 Senior Notes". The hedge consists of swapping the cash flows (cross currency interest rate swaps) with a foreign currency risk (USD) for Reais and a fixed interest rate for a fixed percentage of the CDI (local market). The table below shows the fair value and gain recognized in the statement of profit or loss:

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

	December 31, 2014			December 31, 2013
Fair value of the Senior Notes 2023		1,222,589			1,067,134
Gain (loss) recognized in financial results		(265,196	)		50,648

Hedge accounting - Cash flow

On September 1, 2014, CLE made a formal designation of derivative financial instruments to hedge exposure to exchange rate payments of imports of raw materials (base oil) subjected to hedge accounting, by documenting: (i) the relationship of the hedge, (ii) the purpose and strategy of risk management in the subsidiary taking the hedge, (iii) identification of the financial instrument, (iv) the object or covered transaction, (v) the nature of the risk being covered, (vi) a description of the coverage, (vii) the demonstration of the correlation between the hedge and the hedged, and (viii) the retrospective and prospective effectiveness of the hedge.

The Company recorded gains and losses considered to be effective for the purposes of hedge accounting in a specific account in equity until the hedged item is paid, at which time this gain or loss of each instrument will be recorded in the same line that gave rise to the hedged item. At December 31, 2014 impacts recorded in equity are as follows:

	Market	Risk	December 31, 2014
Rate lock and exchange
variation of other financial instruments	Future Dollar	Exchange		972
(-) Deferred taxes				(330	)

Equity effect				642

Below are the changes in the balances of other comprehensive income during the year:

			December 31, 2014
Derivatives			December 31, 2014
Gain from the year:
Exchange rate hedging and other financial instruments				1,192
Reclassification to inventories / cost of sales				(220	)

Gain on cash flow hedge (before deferred taxes)				972

Gain on cash flow hedge, net of deferred taxes				642

Sensitivity analysis

The following is the sensitivity analysis of the effects of changes in the relevant risk factors to which the Company is exposed to as of December 31, 2014:

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Assumptions for sensitivity analysis

The following tables present the change in the fair value of derivative financial instruments and loans and financings in one probable and two stressed scenarios, which could result in significant gains or losses to the Company. The Company adopted three scenarios for the impairment of the fair value of the financial instruments.

ii.

Sensitivity analysis

(a)

Sensitivity analysis on changes in foreign exchange rates

The probable scenario was defined based on the US Dollar market rates as at December 31, 2014, which determines the fair values of the derivatives at that date. Stressed scenarios (positive and negative effects, before tax effects) were defined based on changes of a 25% and 50% to the US Dollar exchange rates used in the probable scenario.

			Impacts on P&L(i)
	Risk factor	Probable scenario	Variation scenario (25%) - Increase	Variation scenario (50%) - Increase	Variation scenario (25%) - Decrease	Variation scenario (50%) - Decrease



COMGÁS Derivatives
Exchange rate and interest risks
Exchange rate derivatives
Swap contracts	Decrease in exchange
	rate R$/US$ and
	increase in CDI curve	330,098	82,524	165,049	(82,524)	(165,049)

Other subsidiaries derivatives
Exchange rate risks
Exchange rate derivatives
Term agreements
Purchasing agreements	Decrease in exchange
Purchasing agreements	rate R$/US$	21,970	60,733	99,496	(16,794)	(55,557)
Option agreements
Purchasing agreements	Decrease in exchange
Purchasing agreements	rate R$/US$	11,176	76,206	141,236	(53,854)	(118,884)
Selling agreements	Decrease in exchange
Selling agreements	rate R$/US$	(20,018)	82,200	184,418	(122,237)	(224,455)

Exchange rate and interest risks
Swap contracts	Decrease in exchange
	rate R$/US$ and
	increase in CDI curve	212,807	346,970	579,783	(109,870)	(349,813)

Total impact		556,033	648,633	1,169,982	(385,279)	(913,758)

(i) COMGÁS - Exposure to fluctuations absorbed by the asset (liability), which are passed on to customers through periodic tariff revisions.

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Based on the financial instruments denominated in US Dollars at December 31, 2014 the Company performed a sensitivity analysis by increasing and decreasing the exchange rate for R$/US$ by 25% and 50%. The probable scenario considers the estimated exchange rates at the due date of the transactions for the companies with functional currency Real (positive and negative, before tax effects), as follows:

	Exchange rate sensitivity analysis (R$/US$)
	December 31, 2014		Scenario
	December 31, 2014		Probable		25	%	50	%	-25	%	-50	%
At December 31, 2014		2.6562		2.6562	3.3203		3.9843		1.9922		1.3281

Consider the above scenarios profit or loss would be impacted as follows:

	December 31, 2014
Exchange rate exposure	Balance			25	%	50	%	-25	%	-50	%
Loans and borrowings		(4,508,084	)	(1,127,021	)	(2,254,042	)	1,014,999		2,029,998
Cash and cash equivalents		95,017		23,754		47,509		(23,754	)	(47,509	)
Trade receivables		25,323		6,331		12,662		(6,331	)	(12,662	)

Effect on profit or loss				(1,096,936	)	(2,193,872	)	984,914		1,969,828

(b)

Sensitivity analysis on changes in interest rates

A sensitivity analysis on the interest rates on loans and borrowings and in compensation for the CDI investments with pre-tax increases and decreases of 25% and 50% is presented below:

	December 31, 2014
Exposure interest rate	Balance			Scenario(I)			25	%	50	%	-25	%	-50	%
Short term investments		1,499,039			177,104		221,439		265,796		132,792		88,504
Investment securities		149,735			17,690		22,119		26,550		13,264		8,840
Loans and borrowings		(4,935,384	)		(439,830	)	(549,788	)	(659,745	)	(329,873	)	(219,915	)

Effect on profit or loss							(306,230	)	(367,399	)	(183,816	)	(122,571	)

(I) The CDI and TJLP indexes considered of 11.57% and 5.50%, respectively, were obtained from information available in the market.

The categories of financial instruments are presented below:

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

	Financial assets at
	fair value trough			Loans and
Assets	profit or loss			receivables			Total
Cash and cash equivalents		-			1,649,340			1,649,340
Trade receivables		-			1,346,101			1,346,101
Derivative financial instruments		890,578			-			890,578
Securities		-			149,735			149,735
Dividends receivable		-			36,130			36,130
Judicial deposits		-			418,385			418,385
Other financial assets		-			440,180			440,180

		890,578			4,039,871			4,930,449


	Financial liabilities			Other
	at fair value trough			financial
Liabilities	profit or loss			liabilities			Total
Loans and borrowings		-			(8,502,640	)		(8,502,640	)
Derivative financial instruments		(333,434	)		-			(333,434	)
Trade payables		-			(1,112,459	)		(1,112,459	)
Preferred shareholders
payable in subsidiaries		(1,926,888	)		-			(1,926,888	)
Dividends payable		-			(59,217	)		(59,217	)

		(2,260,322	)		(9,674,316	)		(11,934,638	)

Capital management

The Company's policy is to maintain a robust capital base to promote the confidence of investors, creditors and the market, and to ensure the future development of the business. Management monitors that the return on capital is adequate for each of its businesses, which the Company defines as the result of operating activities divided by total net equity.

32	Fair value hierarchy

The fair value of financial assets and liabilities is determined by reference to price at which they could be exchanged in a current transaction between parties willing to negotiate, and not in a forced sale or liquidation. The following methods and assumptions were used to estimate the fair value.

The fair value of cash and cash equivalents, accounts receivable, accounts payable and other short-term obligations approximate their respective carrying values due largely to the short-term maturities of these instruments.

The fair value of marketable securities and bonds is based on price quotations at the balance sheet date. The fair value of non-negotiable instruments, bank loans and other debt, obligations under finance leases, as well as other non-current financial liabilities, are estimated using discounted future cash flow at the rates currently available for similar instruments.

100

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

The fair value of the Senior Notes due in 2018 and 2023 listed on the Luxembourg stock exchange (Note 17) is based on their quoted market price at December 31, 2014 of 88.74% (86.99% at December, 31 2013) and 99.38% (87.75% at December, 31 2013), respectively, of the face value of the Notes as at December 31, 2014.

The fair value of the perpetual bonds listed on the Luxembourg stock exchange (Note 17) is based on its quoted market price as December 31, 2014 of 101.00% (99.75% at December, 31 2013) of the face value of the bonds as at December 31, 2014.

The fair value market of other loans and financing approximate the amounts recorded in the financial statements, as they are subject to variable interest rates (Note 17).

The fair value of available for sale financial assets, is obtained through quoted market prices in active markets, when available.

The Company and its subsidiaries enter into derivative financial instruments with various counterparties, primarily financial institutions with investment grade credit ratings. Derivatives financial instruments mainly relate to interest rate swaps, foreign exchange contracts and term contracts for commodities futures. Fair value of such derivative financial instruments is determined using valuation techniques and observable market data. The valuation techniques usually applied include the pricing models for fixed-term contracts and swaps, with a present value calculation. The models consider various inputs, including the credit risk the of counterparties, the spots and forward currency exchange rate, interest rate curves and forward rate curves of the underlying commodities.

Fair value hierarchy

The Company uses the following hierarchy to determine and disclose the fair values of financial instruments based on the valuation methodology used. Note 14 provides disclosures on investment property that is measured ate fair value and Note 30 for disclosure of assets held for sale that are measured at fair value:

Level 1: quoted prices in an active market for identical assets and liabilities;

The fair value of the assets and liabilities traded in active markets is based on quoted market prices at the balance sheet date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm's length basis

Level 2: other techniques for which all of the data having a significant effect on the fair value recorded are observable, directly or indirectly;

The fair value of assets and liabilities that are not quoted in an active market (for example, over-the-counter derivatives) is determined by using valuation techniques. These valuation techniques maximize the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2. If one or more of the significant inputs is not based on observable market data, the asset or liability is included in Level 3.

Specific valuation techniques used to value financial instruments include:

101

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Quoted market prices or dealer quotes for similar instruments;

II.

The fair value of interest rate swaps is calculated as the present value of the estimated future cash flows based on observable yield curves;

III.

Other techniques, such as discounted cash flow analysis, are used to determine fair value for the remaining financial instruments.

Level 3: inputs for the instrument that are not based on observable market data (that is, unobservable inputs). As of December 31, 2014 and 2013 there are no financial instruments classified as Level 3.

Below if the fair value of the Company’s financial instruments classified as level 1 and 2:

Assets and liabilities
measured at fair value	Level 1		Level 2		Total
At December 31, 2014
Derivative financial assets		-		890,578		890,578
Derivative financial liabilities		-		333,434		333,434
Contingent consideration - Earn out		-		186,649		186,649
Pension plan assets		313,955		49,061		363,016
Securities		-		149,735		149,735
Assets held for sale		-		25,089		25,089
Preferred shareholders
payable in subsidiaries		-		1,926,888		1,926,888
Investment properties		-		2,641,978		2,641,978

Total		313,955		6,203,412		6,517,367

At December 31, 2013
Derivative financial assets		-		513,934		513,934
Derivative financial liabilities		-		331,341		331,341
Contingent consideration - Earn out		-		227,976		227,976
Securities		-		87,978		87,978
Pension plan assets		270,804		31,948		302,752
Assets held for sale		-		314,104		314,104
Investment properties		-		2,281,509		2,281,509

Total		270,804		3,788,790		4,059,594

102

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

33	Pension and post-employment benefit plans

	December 31, 2014		December 31, 2013
Futura		23,048		71,065
Futura II		240		828
COMGÁS		278,562		267,242

Total		301,850		339,135

Pension plans

Defined benefit

Cosan Lubrificantes e Especialidades S.A. has a non-contributory defined benefit pension plan (Futura, formerly Previd Exxon) for certain employees upon retirement. This plan was amended to close it to new entrants and approved by the relevant authorities on May 5, 2011. No new employees are eligible to participate on the plan, contributions ceased, and participants are guaranteed a benefit proportionate to their accumulated entitlement as at March 31, 2011. During the year ended December 31, 2014, the amount of contributions totaled R$8,757. During the year ended December 31, 2014, an actuarial loss was of R$31,285was recognized in other comprehensive income.

Defined contribution

Since June 1, 2011, the Company and its subsidiaries have sponsored a defined contribution plan for all employees (Futura II). The Company does not have a legal or constructive obligation to pay further contributions if the fund does not have sufficient assets to pay all of the benefits owed. During the year ended December 31, 2014 the amount of contributions totaled R$ 467 (R$ 745 on December 31, 2013). During the year ended December 31, 2014, an actuarial loss of R$ 7 (R$ 144 on December 31, 2013), was recognized in other comprehensive income.

COMGÁS offers a supplementary retirement plan, through a defined contribution Free Benefit Generating Plan (“PGBL”). During the year ended December 31, 2014, employers’ contributions to the plan totaled R$14,672 (R$ 14,969 for December 31, 2013). For the year ended December 31, 2014, an actuarial gain of R$ 4,450 was recognized in other comprehensive income.

Actuarial pension obligation

Futura

The pension obligation related to Futura is recorded in non-current liabilities as at December 31, 2014 for an amount of R$ 23,048 (R$ 71,065 on December 31, 2013).

Details of the present value of the defined benefit obligation and the fair value of plan assets are as follows:

103

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

	December 31, 2014			December 31, 2013
Present value of actuarial obligation
at beginning of period		(352,207	)		(402,850	)
Interest expense		(41,459	)		(29,684	)
Benefits payment		25,064			18,784
Actuarial gain on obligation
at beginning of the period		11,223			61,543

Present value of actuarial obligation
at the end of the period		(357,379	)		(352,207	)

Fair value of plan assets at
beginning of the period		281,142			324,445
Return on plan assets		33,317			23,997
Contributions received by the fund		8,757			6,501
Benefit payments		(25,064	)		(18,784	)
Gain (loss) in fair value of plan assets		36,179			(55,017	)

Fair value of plan assets end of the period		334,331			281,142


Present value of pension obligation
in excess of fair value of plan assets		(23,048	)		(71,065	)

Total expense recognized in profit or loss is as follow:

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013


Interest expense		(41,459	)		(29,684	)		(34,208	)
Expected return on plan assets		33,317			23,997			36,281
Early plan settlement		-			-			778

		(8,142	)		(5,687	)		2,851

Total amount recognized as accumulated other comprehensive income:

	Twelve months ended December 31, 2014			Nine months ended December 31, 2013			Twelve months ended March 31, 2013


Accumulated at the
beginning of the period		5,061			(35,557	)		(1,389	)
Unrecognized gains (losses)		11,223			61,543			(51,770	)
Deferred income tax		(3,816	)		(20,925	)		17,602

Accumulated at the
end of the period		12,468			5,061			(35,557	)

104

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Plan assets are comprised of the following:

	December 31, 2014				December 31, 2013
	Amount		%		Amount		%
Fixed income bonds		269,170		80.51		201,129		71.54
Variable-income securities		65,161		19.49		80,013		28.46
Total
		334,331		100.00		281,142		100.00

Plan assets are comprised of financial assets with quoted prices in active markets and therefore are classified as Level 1 in the valuation hierarchy of fair value. The overall expected rate of return on plan assets is determined based on prevailing market expectations on that date, applicable to the period over which the obligation is to be settled. These expectations are reflected in the following main assumptions.

The fair value of the financial instrument issued by the Company’s subsidiaries and held as plan’s assets are follows:

	December 31, 2014				December 31, 2013
	Number of shares		Fair value		Number of shares		Fair value
Cosan S.A. ON NM (CSAN3)		708,660		20,443		708,660		28,046
Cosan Log ON NM (RLOG3)		708,660		2,027		-		-
Total				22,470				28,046

The main assumptions used to determine the benefit obligations of the Company are as follows:

Defined benefit plan	December 31, 2014	December 31, 2013
Actuarial valuation method	Projected unit credit	Projected unit credit
Mortality table	AT-2000 segregated by sex,	AT- 2000 segregated by sex,
	decreased by 10%	decreased by 10%
Discount rate for
actuarial liability	Interest: 11.92% per year	Interest: 12.16% per year
Expected rate of
return on plan assets	Interest: 11.92% per year	Interest: 12.16% per year
Salary growth rate	Not applicable	Not applicable
Increase rate of
estimated benefits	Inflation: 5.2% per year	Inflation: 5.4% per year

The Company expects to make contributions for an amount of R$7,882 in relation to its defined benefit plan and variable contribution plan in 2015.

105

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

COMGÁS

The obligations for post-employment benefits plans, which include medical and early retirement incentives, disability and sickness allowance.

COMGÁS maintains with Bradesco Vida e Previdência S.A., a variable-contribution complementary open pension plan denominated Free Benefit Generating Plan (PGBL), approved by the Superintendence of Private Insurances (SUSEP). This is a fixed-income plan, the objective of which is to provide pension benefits in the form of lifetime monthly pensions.

The actuarial assumptions are as follow:

Actuarial assumptions	December 31, 2014	December 31, 2013
Discount rate	12.78%	12.36%
Inflation rate	6.00%	5.50%
Expected rate of return on plan assets	12.78%	12.36%
Future salary increases	9.18%	8.66%
Increase in pension plans	6.00%	5.50%
Mortality (ageing factor)	3.00%	3.00%
Mortality (by gender)	AT 2000 M&F	AT 2000 M&F
Disabled Associates Mortality	IAPB 1957	IAPB 1957
Disability entry (modified)	UP-84	UP-84
Turnover	30% / (Length of service +1)	30% / (Length of service +1)

The Benefit plan was assessed by management in conjunction with its actuarial experts at December 31, 2014, to determine whether the contribution rates are sufficient maintain reserves necessary to meet current and future payments.

The compositions of the balance of the actuarial liabilities are as follows:

	December 31, 2014			December 31, 2013
Present value of actuarial obligations		284,770			274,433
Fair value of the plan assets		(6,208	)		(7,191	)

Net actuarial pension obligation		278,562			267,242

Change in actuarial obligations are shown below:

106

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)


	December 31, 2014			December 31, 2013
Actuarial liabilities at
beginning of the period		267,242			291,041
Expenses		32,735			27,700
Employer contributions		(14,672	)		(14,969	)
Actuarial losses recognized in
the other comprehensive income		(6,743	)		(36,530	)

Actuarial liabilities at
end of the period		278,562			267,242

Sensitivity analysis

Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown below.

Present value of actuarial obligations effect:

	Discount rate
	Increase					Decrease
		1	%	0,5	%		-1	%	-0.5	%
Futura		(32,781	)	-			39,413		-
Futura II		(18	)	-			20		-
COMGÁS		-		(15,307	)		-		16,836

34	Share-based payment

At the annual and extraordinary general shareholders’ meeting held on July 29, 2011, the guidelines for the outlining and structuring of the stock option compensation plan for Cosan S.A.’s executives and employees were approved, authorizing the issue of up to 5% of shares of Cosan S.A.’s total capital. This stock option plan was created to attract and retain executives and key employees, offering them the opportunity to become Cosan S.A.’s shareholders.

On August 18, 2011, Cosan S.A.’s board of directors approved the total number of stock option awards of 12,000,000 shares to be issued or treasury shares held by Cosan S.A., corresponding to 2.41% of the share capital at that time. On the same date the eligible executives were informed about the terms and conditions of the stock-option plan.

As of August 18, 2011, 10,525,000 awards were granted in the three tranches described below:

Tranche A - The options can be exercised after a vesting period of one year, considering a maximum percentage of 20% per annum of the total stock options granted by Cosan S.A. for an exercise period of 5 years. Exercise period ends on August 19, 2016.

107

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

Tranche B - The options can be exercised after a vesting period of one year, considering a maximum percentage of 10% per annum of the total stock options granted by Cosan S.A. within an exercise period of 10 years. Exercise period ends in August 19, 2021.

Tranche C - The options can be exercised after a vesting period of one year, considering a maximum percentage of 20% per annum of the total stock options granted by Cosan S.A. for an exercise period of 5 years. Exercise period ends on December 11, 2017

According to the average market value of the shares over a 30 day period ending at issuance, the exercise price was defined to be R$22.80 per share, without any discount.

At April 24, 2013 and April 25, 2014, 970,000 and 960,000 options, respectively, secured from the fifth year, were granted to eligible executives based on the below:

The fair value of options granted was estimated at the date of exercise using the binomial model simulation, considering the terms and conditions upon which the options were granted;

The options may be exercised with the issuance of new shares or treasury shares that the company may have.

The fair value of share based payments was estimated adopting the binomial model with the following assumptions:

	Options granted
	August 18, 2011			August 18, 2011			December 12, 2012			April 24, 2013			April 25, 2014
	August 18, 2011			August 18, 2011			December 12, 2012
	Tranche A			Tranche B			Tranche C
Exercise price - R$		22.80			22.80			39.60			45.22			37.01
Expected life (in years)	1 to 5			1 to 10			1 to 5				5			5
Interest rate		11.49	%		11.49	%		8.78	%		9.10	%		12.43	%
Expected volatility		31.44	%		30.32	%		31.44	%		27.33	%		29.85	%
Fair value at grant date
(weighted-average) - R$		6.80			8.15			11.10			17.95			15.67

Expected exercise - The expected timeframe for the exercise of the options was determined by considering the premise that executives exercise their options after the grace period.

Expected volatility – The Company opted to use the historic volatility of their shares adjusted by volatility of competitors’ shares that operate in similar lines of business.

Expected dividends – The dividends expected were calculated on the basis of the current market value on the grant’s date, adjusted by the average rate of return of capital to shareholders during the forecast period, and compared with to the book value shares.

Risk free interest rate – the company considered the prime rate as the risk free interest rate traded at BM&FBovespa on the grant date and for the equivalent term of the option maturity.

On October 1, 2014 at the Extraordinary General Meeting (“EGM”), the Cosan S.A. shareholder’s approved the partial spin-off of Cosan S.A. and merger of the spun-off portion into Cosan Log, composed of Cosan’s

108

Cosan Limited

Notes to the consolidated financial statements

(Amounts in thousands of Brazilian Reais – R$, unless otherwise stated)

logistics operations. The EGM also approved the Cosan Log’ Stock Option Plan in similar terms to the existing Cosan S.A. Plan, allowing their beneficiaries upon exercise to receive one Cosan S.A. share and one Cosan Log share. The exercise prices of the plans of Cosan S.A. and Cosan Log were adjusted so that the beneficiaries of the stock option plan of the two companies had their options set at the same exchange ratio for all shareholders’ (one share of Cosan S.A. and one share Cosan Log).

At December 31, 2014, R$ 12,924 (R$ 6,595 on December 31, 2013) had been recognized as an expense related to the stock option plan. The weighted average remaining contractual term for the options at December 31, 2013 was two years. The expenses to be recognized in future years total R$ 27,455 at December 31, 2014.

The changes in the plan during the period was:

				Weighted-
	Number of			average
	options			exercise price - R$
At March 31, 2013		9,102,000			23.99
Granted		925,000			45.54
Share options exercised		(682,000	)		(23.95	)
At December 31, 2013		9,345,000			26.09
Granted		1,705,000			40.62
Share options exercised		(1,818,000	)		(25.21	)
Cancellation or settlements		(320,000	)		-

At December 31, 2014		8,912,000			30.09

35	Subsequent events

Antitrust approval of the merger with ALL:

On February 11, 2015, the merger of ALL by the Company’s subsidiary Rumo was approved by CADE (antitrust authority) pursuant to Article 61 of Law No. 12,529/2011, upon the conclusion of an Merger Control Agreement (“ACC”) subject to conditions precedent to restrict certain competition conflicts as determined by the General Superintendent of the CADE.

These restrictions will remain in force for a period of seven years and are aimed at ensuring fair treatment for all rail freight users, mainly through governance rules and increased pricing transparency, provide control services and limiting the use of rail transport by related parties.

The Company and its subsidiaries intend to proceed with the necessary steps to effect the merger, pursuant to the Merger Protocol.

* * *

109

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.