CVM Instruction No. 371 of June 27, 2002 (Revoked)

CVM INSTRUCTION NO. 371, OF JUNE 27, 2002.

Provides for the accounting registration of deferred tax assets resulting from temporary differences and tax losses and negative base for social contribution.

The PRESIDENT OF THE SECURITIES AND EXCHANGE COMMISSION - CVM makes public that the Collegiate Body, in a meeting held on May 14, 2002, in accordance with § 3 of art. 177 of Law No. 6,404, of December 15, 1976, combined with items II and IV of § 1 of art. 22 of Law No. 6,385, of December 7, 1976, RESOLVED to issue the following Instruction:

Art. 1
The accounting registration of Deferred Tax Assets, by publicly-held companies, resulting from temporary differences and tax losses and negative base for social contribution on net income, as well as the maintenance of this registration, shall observe, in addition to the provisions of CVM Deliberation No. 273, of August 20, 1998, the provisions contained in this Instruction.

Art. 2
For the purposes of initial recognition of the Deferred Tax Asset, the company must comply, cumulatively, with the following conditions:
I - present a history of profitability; and
II - present an expectation of generation of future taxable profits, brought to present value, based on a technical feasibility study, which allow the realization of the deferred tax asset within a maximum period of ten years.

Sole Paragraph. The provision of item I of this article does not apply to newly constituted companies or those in the process of operational restructuring and corporate reorganization, whose history of losses is due to their previous phase.

Art. 3
It is presumed that there is no history of profitability in the company that did not obtain taxable profit in at least 3 (three) of the last five fiscal years.

Sole Paragraph. The presumption referred to in the caput of this article may be rebutted if the company discloses, in a note to the financial statements, a justified explanation of the actions being implemented, aiming to generate taxable profit.

Art. 4
The technical study referred to in item II of art. 2 must be examined by the board of auditors and approved by the company's administration bodies, and must also be reviewed each fiscal year, adjusting the value of the deferred tax asset whenever there is a change in the expectation of its realization.

CVM INSTRUCTION NO. 371, OF JUNE 27, 2002.
2

Art. 5
The independent auditor, when issuing their opinion on the accounting statements, must evaluate the adequacy of the procedures for the constitution and maintenance of the deferred tax asset and liability, including with regard to the premises used for the preparation and updating of the technical feasibility study referred to in this Instruction.

Art. 6
Publicly-held companies must keep in good order, for a minimum period of 5 (five) years, or while the administrative process initiated by the CVM continues, all documentation and calculation memos related to the preparation of the technical feasibility study referred to in this Instruction.

Art. 7
In addition to the information required in the pronouncement of IBRACON approved by CVM Deliberation No. 273/98, and without prejudice to the sole paragraph of art. 3 of this Instruction, publicly-held companies must disclose, in a note:
I - estimate of the installments of realization of the deferred tax asset, discriminated year by year for the first 5 (five) years and, from then on, grouped in maximum periods of 3 (three) years, including for the portion of the deferred tax asset not registered that exceeds the realization period of 10 (ten) years referred to in item II of art. 2; II - effects resulting from eventual change in the expectation of realization of the deferred tax asset and respective grounds, as provided in art. 4; and III - in the case of newly constituted companies, or in the process of operational restructuring or corporate reorganization, description of the administrative actions that will contribute to the future realization of the deferred tax asset.

Art. 8
Publicly-held companies, while they do not adapt to the provisions contained in arts. 2 and 4 of this Instruction, are prohibited from recognizing, in their accounting statements, any new deferred tax asset.

Art. 9
This Instruction enters into force on the date of its publication, applying to fiscal years and quarterly statements closed after its publication.

Original signed by
LUIZ ANTONIO DE SAMPAIO CAMPOS
Acting President