José Elias Feres de Almeida

Effects of income smoothing practices on the conservatism of public companies listed on the BM & FBOVESPA

The aim of this study was to investigate two aspects of accounting information that may be inherently related: income smoothing practices and conditional conservatism. Theoretically, the more a firm employs income smoothing, i.e., uses accruals to reduce the variability of profits, the less possibility there is for the timely acknowledgement of future economic losses (i.e., bad economic news) in profits. Eckels model (1981) was used in this study to classify listed companies as smoothing or non-smoothing, and Basus model (1997) was used to quantify the degree of conditional conservatism present in each firm. To make the results more robust, samples were created with annual stock return data from both March and December. The results indicated that non-smoothing firms had a higher degree of conditional conservatism, i.e., more opportunity to recognize future economic losses because the market could use the stock return data to anticipate future losses contained in the information regarding profits. This research made it possible to observe theoretical relationships between properties of accounting information: i) there is a relationship between income smoothing and conditional conservatism (i.e., accounting choices); ii) the informational environment of the Brazilian capital market contributes to the market distinction between smoothing and non-smoothing firms; and iii) the improvement of the capital market provides economic operators with greater insight into economic losses that are contained in accounting results.

Concentração de votos e acordo de acionistas: influências sobre o conservadorismo

This study investigates how two features of the ownership structure of Brazilian companies, the voting rights concentration and the shareholders agreement, are associated with the conditional conservatism proposed * Artigo apresentado no 4o Congresso ANPCONT, em Natal-RN, 2010. RCF_v21n54_miolo.indb 6 21/1/2011 08:01:46 Concentracao de votos e acordo de acionistas: influencias sobre o conservadorismo Revista Contabilidade & Financas, USP, Sao Paulo, v. 21, n. 54, p. 6-22, setembro/dezembro 2010 7 by Basu (1997). This association was founded on the effects of entrenchment and enforcement. Considering that the degree of conservatism of a firm is tied to the incentives arising from mechanisms that reduce the informational risk to stakeholders, this study was developed on the following research question: What is the influence of both the voting rights concentration and shareholders agreement on the degree of conservatism in the companies listed on Bovespa? The main goal of this work is to deal with factors not yet considered in the (national and international) literature produced in this line of research, and provides evidence about the influence of ownership structure on conservatism in the Brazilian market, which is marked by a, agency conflict between controlling shareholders (controller) and minority shareholders. The sample of the paper comprises 617 observations of non-financial companies traded on Bovespa during the period from 2000 to 2008. Alternatively, another sample was selected, disregarding the observations for 2008, as a means to remove the effects of the financial crisis registered that year. The evidences indicate that the voting rights concentration contributes to decrease the degree of conservatism, while, on the other hand, the stockholders agreement contributes to an increase. Alternatively, the results considered in the global crisis year distort the Basu model (1997). The researchers hope this study contributes for investors, regulators, researchers and analysts to understand the function of accounting information in companies’ governance process.

Efeitos do comitê de auditoria e do conselho fiscal na qualidade da informação contábil no Brasil

This study evaluates the effects of the audit committee and the fiscal council with their different characteristics on earnings quality in Brazil. The proxies of earnings quality used are: relevance of accounting information, timeliness, and conditional conservatism. The sample consists of Brazilian companies listed on the Brazilian Securities, Commodities, and Futures Exchange (BM&FBOVESPA) with annual liquidity above 0.001 within the period from 2010 to 2013. Data were collected from the database Comdinheiro and the Reference Forms of companies available on the website of the Brazilian Securities and Exchange Commission (CVM) or the BM&FBOVESPA. The samples used in the study totaled 718, 688, and 722 observations for the value relevance, timeliness, and conditional conservatism models, respectively. The results indicate that different arrangements of the fiscal council and the existence of the audit committee differently impact the accounting information properties. The presence of the fiscal council positively impacted the relevance of equity, while the presence of the audit committee, the relevance of earnings. Conditional conservatism is evidenced in the group of companies with a permanent fiscal council, demonstrating that it is significant as a governance mechanism, rather than the installation for temporary operation when asked by shareholders in an ordinary general meeting. The presence of both showed significant earnings for the market, but they were not timely, something which exposes restriction to the relevance found. Lastly, the powered fiscal council showed a positive association only concerning the relevance of equity.

Structural changes in covenants through the adoption of IFRS in Brazil

Abstract This study examines changes in the structure of covenants in debt agreements of companies issuing debentures during the adoption of International Financial Reporting Standards (IFRS) in Brazil. We investigate debt contracts of public and private companies that issued debentures before and after IFRS adoption in Brazil, between the years 2006–2008 and 2011–2014. We develop a database with all covenants from 126 contracts via hand-collected data, with 78 contracts from before IFRS adoption and 48 contracts afterward. We find high increases in covenants after adoption. However, this growth is observed only for restrictive security and non-accounting covenants, excluding clauses with accounting multiples. Our results show that IFRS adoption in Brazil shifted incentives and, as a result, shaped a new structure of debt contracts. Our findings complement and expand previous studies and can be useful to academics, regulators and practitioners by showing that the incentives to use accounting figures and ratios shifted in the credit market after IFRS adoption.

Lucro Abrangente e Medidas de Risco Total e Sistemático de Companhias Brasileiras de Capital Aberto

OBJETIVO O presente artigo busca verificar se o lucro abrangente e seus componentes sao relevantes para a explicacao do risco das empresas. METODOLOGIA E analisada uma amostra composta por 105 companhias brasileiras de capital aberto com acoes negociadas na BM&FBovespa, nao financeiras e com dados disponiveis no periodo compreendido entre o primeiro trimestre de 2011 e o primeiro de trimestre de 2015, por meio de modelos que levam em consideracao a estrutura do painel de dados. RESULTADOS E CONCLUSOES Verifica-se que a relacao entre a volatilidade do lucro abrangente e o risco da empresa e superior aquela observada entre a volatilidade do lucro liquido e o risco. Verifica-se tambem que a volatilidade do valor referente a outros resultados abrangentes possui relacao negativa com seu risco sistematico. Ganhos e perdas com hedges de fluxo de caixa e com ativos financeiros classificados como disponiveis para venda tambem apresentam relacao negativa com o risco da empresa. IMPLICACOES PRATICAS As evidencias apresentadas pelo presente estudo corroboram a importância do assunto, fornecendo insumos para discussoes sobre politicas contabeis relacionadas ao lucro e para o desenvolvimento de metricas contabeis para a avaliacao do risco das empresas. PALAVRAS-CHAVE Lucro Abrangente, Volatilidade do Lucro, Risco, Dados em Painel.   COMPREHENSIVE INCOME AND THE TOTAL AND SISTEMATIC RISK OF BRAZILIAN PUBLIC COMPANIES OBJECTIVE This research aimed to verify if the comprehensive income and its components are relevant in explanation of the firm risk. METHODOLOGY A sample of 105 Brazilian non-financial public companies with shares traded on the BM&FBovespa and with data available from the first quarter of 2011 to the first quarter of 2015 is analyzed, through models that take into account the panel structure of the data. RESULTS AND CONCLUSIONS The results show that the relationship between the volatility of comprehensive income and the companys risk is higher than that observed between the volatility of net income and risk. It is also found that the volatility of the value related to other comprehensive income has negative relationship with its systematic risk. Gains and losses from cash flow hedges and financial assets classified as available for sale shows a negative relationship with the risk of the firm. PRACTICAL IMPLICATIONS Evidence presented in this study confirm the importance of the subject, providing inputs to discussions on accounting policies related to income and to the development of accounting metrics for risk assessment of firms. KEYWORDS Comprehensive Income, Income Volatility, Risk, Panel Data.

Convergencia brasileña con los estándares internacionales de contabilidad pública vis-à-vis las estrategias top-down y bottom-up

Brasil pasa por un proceso de convergencia de su contabilidad publica con relacion a los estandares internacionales desarrollados por la Federacion Internacional de Contadores (Ifac). La implementacion de sistemas de informacion contable es realizada generalmente por medio de los abordajes top-down o bottom-up. Asi, este estudio tiene como objetivos: 1) identificar el abordaje adoptado por el gobierno federal brasileno; 2) describir el modelo de implementacion del sistema de informacion contable publica en Brasil; y 3) mapear el flujo de informaciones y los actores involucrados en el proceso de convergencia. El abordaje cualitativo fue adoptado utilizando la investigacion documental y el analisis de contenido de documentos disponibles para poner en operacion la investigacion. Se identifico que Brasil utiliza el abordaje middle-up-down, que favorece la interaccion entre multiples actores en el proceso, diferentemente del abordaje top-down, que sigue el modelo internacional divulgado.

Brazilian convergence with the international standards of public accounting vis-à-vis the top-down and bottom-up strategies

Brasil pasa por un proceso de convergencia de su contabilidad publica con relacion a los estandares internacionales desarrollados por la Federacion Internacional de Contadores (Ifac). La implementacion de sistemas de informacion contable es realizada generalmente por medio de los abordajes top-down o bottom-up. Asi, este estudio tiene como objetivos: 1) identificar el abordaje adoptado por el gobierno federal brasileno; 2) describir el modelo de implementacion del sistema de informacion contable publica en Brasil; y 3) mapear el flujo de informaciones y los actores involucrados en el proceso de convergencia. El abordaje cualitativo fue adoptado utilizando la investigacion documental y el analisis de contenido de documentos disponibles para poner en operacion la investigacion. Se identifico que Brasil utiliza el abordaje middle-up-down, que favorece la interaccion entre multiples actores en el proceso, diferentemente del abordaje top-down, que sigue el modelo internacional divulgado.

Convergência brasileira aos padrões internacionais de contabilidade pública vis-à-vis as estratégias top-dow e bottom-up

Brasil pasa por un proceso de convergencia de su contabilidad publica con relacion a los estandares internacionales desarrollados por la Federacion Internacional de Contadores (Ifac). La implementacion de sistemas de informacion contable es realizada generalmente por medio de los abordajes top-down o bottom-up. Asi, este estudio tiene como objetivos: 1) identificar el abordaje adoptado por el gobierno federal brasileno; 2) describir el modelo de implementacion del sistema de informacion contable publica en Brasil; y 3) mapear el flujo de informaciones y los actores involucrados en el proceso de convergencia. El abordaje cualitativo fue adoptado utilizando la investigacion documental y el analisis de contenido de documentos disponibles para poner en operacion la investigacion. Se identifico que Brasil utiliza el abordaje middle-up-down, que favorece la interaccion entre multiples actores en el proceso, diferentemente del abordaje top-down, que sigue el modelo internacional divulgado.

COMPARAÇÃO DA ACURÁCIA DE ANALISTAS COM O MODELO DE OHLSON-JUETTNER (OJ) NO MERCADO BRASILEIRO

A presente pesquisa foi desenvolvida com o objetivo de avaliar o grau de acuracia dos modelos de avaliacao baseado em informacoes contabeis e do preco-alvo indicado pelos analistas de mercado, quando comparados ao valor real da acao. Para chegar as conclusoes do trabalho, foi utilizada uma abordagem quantitativa que, por meio de testes estatisticos, buscou verificar qual dos resultados, dentre o indicado pelo modelo de avaliacao baseado em informacoes contabeis Ohlson-Juettner (OJ) e o fornecido pelos analistas de mercado, ficou mais proximo ao valor real da acao. A amostra utilizada para a realizacao do estudo continha as empresas listadas no Indice Brasil (IBrX), com informacoes financeiras no periodo de 2004 a 2011, que geraram precos alvo de 2005 a 2012. O teste dos sinais, que foi o teste estatistico utilizado, mostrou uma maior similaridade entre o valor da acao e o modelo de precificacao baseado em informacoes contabeis OJ quando comparado ao preco-alvo indicado pelos analistas de mercado, o que foi corroborado pelo teste dos sinais com postos de Wilcoxon, utilizado como contraprova. Uma das possiveis explicacoes para o resultado se deve ao fato das previsoes dos analistas de mercado serem demasiadamente otimistas frente ao valor da acao nas datas de analise.

Earnings Quality in Brazilian Public Companies Supervised by Regulatory Agencies

The study investigates regulation impact on earnings quality in Brazilian firms. The Brazilian context provides an ideal set of conditions to explore this issue, such as code law, weak institutional environment and weak enforcement. In view of the scenario, we expected the presence of regulatory agencies to improve earnings quality and to reduce information asymmetry in Brazilian firms. The hypothesis was not confirmed by the findings as regulation was found not to improve earnings quality of Brazilian firms. The study draws attention to the need for regulatory agencies to encourage good accounting practices and strengthen economic regulations in Brazil.