BCB Resolution No. 7

BCB RESOLUTION NO. 7, OF AUGUST 12, 2020

Specifies the criteria and procedures for accounting recognition and measurement of intangible asset components and prohibits the registration of deferred assets by consortium administrators and payment institutions.

Specifies the criteria and procedures for accounting recognition and measurement of intangible asset components and prohibits the registration of deferred assets by consortium administrators, payment institutions, securities brokerage firms, securities distribution firms, and foreign exchange brokerage firms authorized to operate by the Central Bank of Brazil. (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

Specifies the criteria and procedures for accounting recognition and measurement of intangible asset components and prohibits the registration of deferred assets by institutions required to use the Accounting Standard of Institutions Regulated by the Central Bank of Brazil – Cosif by virtue of BCB Resolution No. 92, of May 6, 2021. (Wording given by BCB Resolution No. 553, of 3/3/2026.)

The Collegiate Board of Directors of the Central Bank of Brazil, in a session held on August 12, 2020, based on arts. 6 and 7, item III, of Law No. 11,795, of October 8, 2008, and 9, item II, and 15 of Law No. 12,865, of October 9, 2013,

RESOLVES:

Art. 1. This Resolution establishes the criteria and procedures for accounting recognition and measurement of intangible asset components and prohibits the registration of deferred assets by consortium administrators and payment institutions.

Art. 1. This Resolution establishes the criteria and procedures for accounting recognition and measurement of intangible asset components and prohibits the registration of deferred assets by the following institutions authorized to operate by the Central Bank of Brazil: (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

Art. 1. This Resolution establishes the criteria and procedures for accounting recognition and measurement of intangible asset components and prohibits the registration of deferred assets by institutions required to use the Accounting Standard of Institutions Regulated by the Central Bank of Brazil – Cosif as per art. 1, caput, item I, of BCB Resolution No. 92, of May 6, 2021. (Wording given by BCB Resolution No. 553, of 3/3/2026.)

I - consortium administrators; (Included, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

I - (Revoked by BCB Resolution No. 553, of 3/3/2026.)

II - payment institutions; (Included, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

II - (Revoked by BCB Resolution No. 553, of 3/3/2026.)

III - securities brokerage firms; (Included, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

III - (Revoked by BCB Resolution No. 553, of 3/3/2026.)

IV - securities distribution firms; and (Included, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

IV - (Revoked by BCB Resolution No. 553, of 3/3/2026.)

V - foreign exchange brokerage firms. (Included, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

V - (Revoked by BCB Resolution No. 553, of 3/3/2026.)

Art. 2. Consortium administrators and payment institutions must register in intangible assets identifiable non-monetary assets without physical substance, acquired or developed by the institution, intended for the maintenance of the institution or exercised with that purpose.

Art. 2. The institutions mentioned in art. 1 must register in intangible assets identifiable non-monetary assets without physical substance, acquired or developed by the institution, intended for the maintenance of the institution or exercised with that purpose. (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

Sole paragraph. For the purposes of this Resolution, it is considered:

I - non-monetary asset, the asset that is not represented by currency units kept in cash and that cannot be received in a fixed or determined number of currency units;

II - identifiable asset:

a) the asset that can be separated and sold, transferred, licensed, leased, or exchanged, individually or together with a contract, related asset or liability, regardless of the intention of use by the consortium administrator or payment institution; or

a) the asset that can be separated and sold, transferred, licensed, leased, or exchanged, individually or together with a contract, related asset or liability, regardless of the intention of use by the institution mentioned in art. 1; or (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

b) the asset that results from contractual rights or other legal rights, regardless of whether such rights are transferable or separable from the consortium administrator or payment institution or other rights and obligations; and

b) the asset that results from contractual rights or other legal rights, regardless of whether such rights are transferable or separable from the institution mentioned in art. 1, or other rights and obligations; and (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

III - developed asset, the asset that results from the application of the results of research or other knowledge in a plan or project aimed at the production of new or substantially improved materials, devices, products, processes, systems, or services, before the start of its commercial production or use.

Art. 3. The recognition of intangible assets developed by consortium administrators and payment institutions depends on the simultaneous occurrence of the following conditions:

Art. 3. The recognition of intangible assets developed by the institutions mentioned in art. 1 depends on the simultaneous occurrence of the following conditions: (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

I - technical feasibility to complete the asset so that it is made available for use;

II - intention to complete the asset and to use it;

III - ability to use the asset;

IV - existence of a market for the products generated by the asset;

V - usefulness of the asset;

VI - availability of technical, financial, and other adequate resources to complete the development of the asset and use it; and

VII - ability to reliably measure the expenditures attributable to the asset during its development.

§ 1. The recognition referred to in the caput must be based on supporting documentation demonstrating compliance with the conditions set forth in items I to VII.

§ 2. The supporting documentation referred to in § 1 must be kept available to the Central Bank of Brazil for at least five years, counted from the initial registration of the corresponding asset.

§ 3. The recognition of intangible assets developed by the consortium administrator or payment institution itself relating to brands, publication titles, and customer lists is prohibited.

§ 3. The recognition of intangible assets developed by the institution itself relating to brands, publication titles, and customer lists is prohibited. (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

Art. 4. Intangible assets must be recognized at cost value, which includes:

I - the acquisition price or the cash development cost, plus any import taxes and non-recoverable taxes; and

II - other directly attributable costs necessary to prepare the asset for the proposed purpose.

Sole paragraph. In the acquisition of intangible assets on credit, the difference between the cash price and the total payments must be allocated monthly, pro rata temporis, in the appropriate expense account, according to the accrual basis.

Art. 5. Intangible assets received as donations, meeting legal and regulatory requirements, must be recorded at their market value, as a counterpart to the period's result:

I - in intangible assets, if they are intended for the maintenance of their own activities or have that purpose for a period longer than one social year; or

II - in current assets, in other cases.

Sole paragraph. The estimated value of any obligation assumed by the consortium administrator or payment institution in the donation operation of the asset must be recognized in liabilities as a counterpart to the period's result.

Sole paragraph. The estimated value of any obligation assumed by the institution mentioned in art. 1 in the donation operation of the asset must be recognized in liabilities as a counterpart to the period's result. (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

Art. 6. Subsequent expenditures after the recognition of intangible assets that effectively increase their useful economic life, efficiency, productivity, or ability to generate future economic benefits may be added to the book value of the asset.

Sole paragraph. The recognition in assets of any subsequent expenditure after the recognition of intangible assets relating to brands, publication titles, logos, customer lists, and items of a similar nature, acquired or developed by the consortium administrator or payment institution, is prohibited.

Sole paragraph. The recognition in assets of any subsequent expenditure after the recognition of intangible assets relating to brands, publication titles, logos, customer lists, and items of a similar nature, acquired or developed by the institution mentioned in art. 1, is prohibited. (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

Art. 7. The amortization of intangible assets with a defined useful life must be recognized monthly over the estimated useful life of the asset, as a counterpart to the specific operational expense account.

§ 1. For the purposes of this Resolution, it is considered:

I - amortization, the systematic allocation of the amortizable value of an intangible asset over its useful life;

II - useful life, the period of time during which the asset is expected to be used, observing the following aspects:

a) the expected use of an asset by the consortium administrator or payment institution;

a) the expected use of an asset by the institution mentioned in art. 1; (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

b) typical product life cycles of the asset and public information on useful life estimates of similar assets, used in a similar manner;

c) technical, technological, commercial, or other types of obsolescence;

d) the stability of the sector in which the asset operates and changes in market demand for products or services generated by the asset;

e) expected measures of competition or potential competitors;

f) the level of maintenance expenditures required to obtain the future economic benefits of the asset and the ability and intention to reach such a level;

g) the period of control over the asset and legal or similar limits for its use, such as expiration dates of related leases and rentals;

h) the useful life of other assets, if the useful life of the asset depends on the joint use of these assets; and

i) legal and economic factors;

III - amortizable value, the difference between the acquisition cost determined in the form of art. 4 and the residual value; and

IV - residual value, the estimated value that would be obtained from the sale of the asset, after deducting estimated sales expenses, if the asset already had the conditions expected for the end of its useful life.

§ 2. The amortization of intangible assets with a defined useful life must correspond to the amortizable value divided by the useful life of the asset, calculated linearly, from the moment the asset is available for use, in the location and conditions necessary for it to be used in the manner intended by management.

§ 3. The residual value of the intangible asset must be zero, except if there is:

I - commitment from third parties to purchase the asset at the end of its useful life; or

II - a liquid market for the asset that meets the following conditions:

a) it is possible to determine the residual value in relation to this market; and

b) it is likely that the market will continue to exist at the end of the asset's useful life.

§ 4. The useful life and residual value of the intangible asset must be reviewed at least at the end of each social year.

Art. 8. The useful life of intangible assets resulting from contractual rights or legal rights must not exceed the validity period of these rights, and may be shorter, depending on the period during which the consortium administrator or payment institution expects to use the asset.

Art. 8. The useful life of intangible assets resulting from contractual rights or legal rights must not exceed the validity period of these rights, and may be shorter, depending on the period during which the institution mentioned in art. 1 expects to use the asset. (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

§ 1. If the rights mentioned in the caput are granted for a limited renewable period, the useful life of the intangible asset must only include the renewal period if the probability of renewal is high, considering, at a minimum, the following factors:

I - evidence, based on experience, that contractual rights or other legal rights will be renewed and that any conditions necessary to obtain the renewal will be met;

II - evidence that, if third-party authorization is necessary to renew contractual rights, such authorization will be granted; and

III - insignificant renewal cost of contractual rights, in relation to the future economic benefits expected from the renewal.

§ 2. If the renewal cost of the rights is significant, when compared to the future economic benefits expected, the renewal cost must essentially represent the acquisition cost of a new intangible asset at the date of renewal.

Art. 9. Amortization must cease on the date the asset is written off or on the date the consortium administrator or payment institution decides to discontinue the use of the asset in its activities, whichever occurs first.

Art. 9. Amortization must cease on the date the asset is written off or on the date the institution mentioned in art. 1 decides to discontinue the use of the asset in its activities, whichever occurs first. (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

Art. 10. Intangible assets characterized as having an indefinite useful life are not amortizable.

§ 1. For the purposes of this article, an intangible asset is characterized as having an indefinite useful life when there is no predictable time limit during which the asset will generate positive net cash flows.

§ 2. The verification and characterization of the intangible asset as having an indefinite useful life must be carried out considering all relevant factors available.

§ 3. The existence of difficulties in determining the useful life of an intangible asset is not a sufficient condition to characterize that asset as having an indefinite useful life.

§ 4. The consortium administrator and payment institution must verify, at a minimum, at the end of each social year if the condition referred to in § 1 remains in effect.

§ 4. The institution mentioned in art. 1 must verify, at a minimum, at the end of each social year if the condition referred to in § 1 remains in effect. (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

§ 5. Any change in assessment regarding the characterization of the intangible asset as having an indefinite useful life must be recognized as a change in accounting estimate, in accordance with current regulations.

Art. 11. The intangible asset must be written off when:

I - it is alienated; or

II - future economic benefits from its use or alienation are not expected.

§ 1. Gains or losses resulting from the write-off of the intangible asset, determined by the difference between the net value of the alienation, if any, and the book value of the asset, must be recognized in the result when the asset is alienated.

§ 2. In the sale of intangible assets on credit, the difference between the cash price and the total expected receipts must be allocated monthly in the appropriate revenue account, according to the accrual basis.

Art. 12. If the consortium administrator or payment institution decides to discontinue the use in its activities of an intangible asset, the asset must be written off, or, if it can be sold, transferred to the appropriate current asset account at the lower of book value or market value minus the costs necessary for sale.

Art. 12. If the institution mentioned in art. 1 decides to discontinue the use in its activities of an intangible asset, the asset must be written off, or, if it can be sold, transferred to the appropriate current asset account at the lower of book value or market value minus the costs necessary for sale. (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

Art. 13. Consortium administrators and payment institutions are prohibited from registering deferred assets.

Art. 13. Institutions mentioned in art. 1 are prohibited from registering deferred assets. (Wording given, from 1/3/2024, by BCB Resolution No. 367, of 1/25/2024.)

Art. 14. Circular No. 3,818, of December 14, 2016, is revoked.

Art. 15. This Resolution enters into force on January 1, 2021.

Otávio Ribeiro Damaso
Director of Regulation