The impact from adapting of the IFRS 9 (CPC 48) on expected credit losses (ECL) in Brazilian energy companies

Abstract

Purpose: To identify the IFRS 9 (CPC 48) adoption impact on Expected Credit Losses, based on historical losses under CPC 38. Methodology: a documentary, exploratory research was carried out in all the companies of the electric energy sector listed on the Brazilian Stock Exchange, denominated, Brazil, Bolsa, Balcão (B3) of the Novo Mercado (NM), Level 1 (N1) and Level 2 (N2) of corporate governance. Analyzing all the expected losses disclosed in the financial statements, mainly the explanatory notes of 2017 and the first quarter of 2018. For the companies that disclosed these adjustments the Wilcoxon average comparison tests and the Boxplot diagram were performed. Results: The survey results showed that not all the companies analyzed disclosed the adjustments and the accounting criteria of the SCPPs in the Explanatory Notes, according to CPC 48, and those that disclosed haven´t had a significant impact on the adoption of the new CPC. Contributions of the Study: This paper contributed to the reflection, understanding and analysis of the adoption, impact and empirical evaluation of the effects of the expected loss models on companies in the electricity sector, corroborating the effects of the Standard CPC 48 (IRFS 9) on the financial statements of companies classified as New Market, starting in January 2018, and may be useful in the process of regulating the segment, in decision-making and possible understanding of its potential effects, particularly in the adequacy of multinational standards. It was verified whether changes in expected losses measurement metrics could result in impacts on net income for the year, as well as changes in the net value of current assets, both of which are relevant to decision making. Such verification is relevant to the managers of the companies and investors, for security in relation to the maintenance of the form of performance verification.