Source: Valor Econômico, 09/11/2004

By Daniele Camba From São Paulo

The accounting law, a kind of appendix to the Brazilian Corporate Law (SA) for the accounting and disclosure of companies' financial statements, can finally get off the ground.

The bill's rapporteur, Deputy Armando Monteiro, is preparing a new substitute that should be taken for approval by the Chamber's Finance and Taxation Committee later this month. Monteiro believes that the final text should be voted on in Congress later this year.

The information was passed by the deputy to the Brazilian Institute of Corporate Governance (IBGC), which held yesterday the 5th Brazilian Congress of Corporate Governance. Monteiro was invited to participate in the event, but was unable to attend.

There are no details of the changes suggested by the deputy. There is an expectation around the article that requires limited companies with assets greater than R $ 240 million or annual gross revenue greater than R $ 300 million to publish a balance sheet, just as it already happens with corporations. The National Confederation of Industries (CNI), of which Monteiro is president, is against the proposal.

This is one of the most controversial points of the project. The first rapporteur, Deputy Émerson Kapaz, included a substitute that allowed limited companies to publish their statements only on the internet. Due to the high costs of publication, especially in the official newspapers, the president of the Securities and Exchange Commission (CVM), Marcelo Trindade, is against the extension of the mandatory publication to the limited ones.

The reform of the financial statements, an old dream of capital market professionals, has been going on since 1999. “The key is to have political strength to unravel the project,” said the director of Bradesco Templeton, Mauro Cunha. He recalls that Brazil has been falling in the ranking of the best countries to invest in, and one of the reasons is the lack of harmonization of accounting standards with international standards.