CVM Instruction No. 346 of September 29, 2000 (Revoked)

CVM INSTRUCTION NO. 346, OF SEPTEMBER 29, 2000.

Provides for the accounting and disclosure of information, by open companies, of the effects resulting from adherence to the Recovery Program.

The PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION – CVM makes public that the Collegiate Body, in a meeting held on this date, based on the provisions of items I, II, and IV of Article 22 of Law No. 6,385, of December 7, 1976, and on § 3 of Article 177 of Law No. 6,404, of December 15, 1976, HAS RESOLVED to issue the following Instruction:

Art. 1
Open companies that adhered to the Fiscal Recovery Program – REFIS, approved by Law No. 9,964, of April 10, 2000, must account for the effects resulting from this adherence as follows:

I – the following items must be recorded in a separate account of the result of the period, revealing their nature, and presented as an extraordinary item:

a) adjustments resulting from differences in rates adopted for determining the amount of tax losses and the negative base of social contribution used to settle interest or fines;

b) amounts resulting from previously unrecognized tax credits;

c) differences between the paid value and the utilization value of credits acquired from third parties and differences between the book value and the sale value of credits to third parties; and

d) adjustments resulting from the consolidation and recognition of debts, including due to the withdrawal of ongoing judicial proceedings.

II – the amount of consolidated debt, subject to settlement based on a percentage of gross revenue, may be recorded at its present value, when relevant and provided that:

a) it is demonstrated that the company has operational capacity to generate, on a continuous basis, revenues and positive cash flows, in an amount sufficient to fulfill its obligations regarding REFIS;

b) the projections, deadlines, rates, amounts, and other premises used to determine the present value are approved by the Board of Directors and submitted for review by independent auditors; and

c) a real interest rate compatible with the nature, term, and risks related to the debt is used for discounting.

CVM INSTRUCTION NO. 346, OF SEPTEMBER 29, 2000.
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III – by characterizing a gain whose realization depends on uncertain future events, the counterpart of the present value adjustment referred to in item II must be recorded as Deferred Revenue and presented, in a separate manner, in the Long-Term Payable group.

IV – the revenue referred to in item III must be recognized in the result of the period, in the operational group, in proportion and within the deadlines in which the debt is being settled.

Art. 2
The projections made to determine the present value adjustment must be reviewed, at least annually, or when there is a relevant change in the premises used.

Art. 3
Without prejudice to the provisions of CVM Instruction No. 31, of February 8, 1984, open companies must disclose, regarding the fiscal years in which they remain in the REFIS program, in explanatory notes to their financial statements and quarterly information, the following information:

a) the amount of debts included in REFIS, segregated by type of tax and nature (principal, fines, and interest);

b) the present value of debts subject to settlement based on gross revenue, as well as the values, deadlines, rates, and other premises used to determine this present value;

c) the amount of tax credits, including those resulting from tax losses and negative bases of social contribution, used to settle interest and fines;

d) the amount paid in the period to amortize debts subject to settlement based on gross revenue;

e) the detail of the items referred to in item I of Article 1;

f) the guarantees provided or assets listed and respective amounts;

g) the mention regarding the obligation to regularly pay taxes, contributions, and other obligations as an essential condition for maintaining the payment conditions provided for in REFIS;

and

h) any and all imminent risks associated with the loss of the special payment regime.

Art. 4
The projections made to determine the present value adjustment must be inserted in the Table of Other Relevant Information of Form IAN – Annual Information, and the monitoring and reviews referred to in Article 2 must be inserted in the Table Monitoring of Business Projections of Form ITR – Quarterly Information.

CVM INSTRUCTION NO. 346, OF SEPTEMBER 29, 2000.
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Art. 5
The accounting of the effects resulting from adherence to the Fiscal Recovery Program – REFIS, referred to in Article 1, must be carried out in the quarter in which adherence is formalized, and must be subject to insertion in Form ITR – Quarterly Information and disclosure of a Relevant Fact Notice, in accordance with CVM Instruction No. 31/84.

Art. 6
This Instruction enters into force on the date of its publication in the Official Gazette of the Union.

Signed original by
JOSÉ LUIZ OSORIO DE ALMEIDA FILHO
President