BNDES Participações S.A. BNDESPAR
(Convenience Translation into English from the
Original Previously Issued in Portuguese)
Financial Statements for the Years
Ended December 31, 2011 and 2010
and Independent Auditor’s Report
Deloitte Touche Tohmatsu Auditores Independentes
(Convenience Translation into English from the Original Previously Issued in Portuguese)
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
BALANCE SHEETS AS AT DECEMBER 31
(In thousands of Brazilian reais – R$)
Note
2011
2010
2,662,137
2,928,994
1,126,479
6
1,126,473
CURRENT ASSETS
CASH AND CASH EQUIVALENTS
Cash and cash equivalents
Banco do Brasil’s exclusive funds
5
6.4
217,630
34
217,596
SECURITIES
Designated debentures
Shares and subscription bonus
Derivatives
6
6.3
9.1
20
282,358
3,907
132,946
145,505
182,221
260
81,464
100,497
2,162,149
226,132
(15,039)
9,347
(2,147)
1,137,629
375,404
428,479
2,344
1,620,294
236,147
(541)
67,915
(1,219)
725,545
261,359
328,097
2,991
OTHER RECEIVABLES
Credit sale of securities
Allowance for losses - credit sale of securities
Receivables
Allowance for losses - receivables
Dividends and interest on capital receivable
7
7.3
7
7.3
8
12.1
Recoverable and prepaid taxes
Escrow deposits
Other
107,996,146
NONCURRENT ASSETS
6
6.3
6.3.3
6.3
6.3.4
9.1
6.5
20
SECURITIES
Loans and receivables – simple debentures
Allowance for credit risk – simple debentures
Designated debentures
Debentures available for sale
Shares and subscription bonus
Investment fund shares
Derivatives
OTHER RECEIVABLES
Credit sale of securities
Allowance for losses - credit sale of securities
Receivables
Allowance for losses - receivables
Tax credits
Tax incentives
Dividends and interest on capital receivable
86,015,375
2,844,124
(12,794)
10,063,285
340,129
70,229,043
2,124,340
427,248
104,463,409
1,058,443
(342)
12,044,076
89,167,652
2,022,829
170,751
2,648,579
1,137,683
(75,663)
37,232
(8,553)
715,394
181,781
660,705
4,789,645
1,135,545
(2,603)
1,608,348
(28,877)
651,140
242,244
1,183,848
7
7.3
7
7.3
12.2
8
9.2
INVESTMENTS
Investments in associates
TOTAL ASSETS
19,332,192
19,332,192
13,641,374
13,641,374
110,658,283
125,823,422
The accompanying notes are an integral part of these financial statements.
3
122,894,428
(Convenience Translation into English from the Original Previously Issued in Portuguese)
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
BALANCE SHEETS AS AT DECEMBER 31
(In thousands of Brazilian reais – R$)
Note
CURRENT LIABILITIES
2011
2010
2,402,600
3,201,313
PAYABLES RELATED TO ISSUED DEBENTURES
11
955,897
306,224
ONLENDINGS
BNDES
10
10
46,106
46,106
872,280
872,280
1,400,597
982,544
128,291
43,331
3
4,969
6,172
13,151
96,338
125,798
2,022,809
983,048
349,295
33,500
5,830
4,186
5,326
7,531
483,569
150,524
27,485,043
36,120,164
OTHER PAYABLES
Dividends
Taxes on income
Other taxes
Provision for labor and civil lawsuits
Actuarial liability - FAMS
Accounts payable - FAPES
Provision for employee termination program
Derivatives
Other
14
12.1
13
17
17
19
20
NONCURRENT LIABILITIES
PAYABLES RELATED TO ISSUED DEBENTURES
11
4,822,300
5,693,542
ONLENDINGS
BNDES
National Treasury
10
11,588,225
8,703,375
2,884,850
13,403,679
10,819,150
2,584,529
OTHER PAYABLES
Accounts payable - FAPES
Actuarial liability - FAMS
Provision for employee termination program
Provision for labor and civil lawsuits
Deferred taxes
17
17
19
13
12.2
11,074,518
118,366
132,287
562,234
10,261,631
17,022,943
114,030
113,705
12,226
535,027
16,247,955
SHAREHOLDERS' EQUITY
14
80,770,640
86,501,945
57,428,861
2,947,631
92,993
3,205,307
1,299,469
226,021
1,679,817
17,095,848
16,816,716
279,132
46,304,356
5,124,505
92,993
5,776,729
1,084,074
191,649
1,551,864
2,949,142
29,203,362
29,414,287
(210,925)
Capital
Capital increase in progress
Capital reserve
Earnings reserves
Legal reserve
Tax incentive
Reserve for compliance with accounting policies
Additional proposed dividends
Valuation adjustments to equity
Own assets
Associates’ assets
110,658,283
TOTAL LIABILITIES
The accompanying notes are an integral part of these financial statements.
4
125,823,422
(Convenience Translation into English from the Original Previously Issued in Portuguese)
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
INCOME STATEMENTS
FOR THE YEARS ENDED DECEMBER 31
(In thousands of Brazilian reais – R$)
Note
OPERATING REVENUES
EQUITY INTERESTS
Equity in investees
Income from sales of variable income securities
Gains (losses) on derivatives
Interest on capital
Dividends
9
FINANCIAL TRANSACTIONS
Loans
Securities
Fixed income securities
Interest on cash and cash equivalents
Gains (Losses) on disposal of fixed income securities
OPERATING EXPENSES
EQUITY INTERESTS
9
Equity interest expenses
Recognition of allowance for losses in permanent investments
Expenses on acquisition of equity interests
FINANCIAL TRANSACTIONS
Financial charges on payables:
. Issued debentures
. BNDES
. National Treasury
Reversal of allowance for losses
15
16
OTHER OPERATING INCOME/EXPENSES
Tax expenses
Officers’ compensation
Personnel expenses
Provision for civil and labor lawsuits
Inflation adjustment of assets and liabilities, net - SELIC
Administrative expenses
Other
2011
8,624,157
8,239,148
7,216,892
1,923,733
1,705,143
(23,485)
2,440,348
1,171,153
6,835,684
1,240,776
3,014,903
351,346
1,593,457
635,202
1,407,265
201,757
1,225,374
(31,885)
12,019
1,403,464
157,373
819,440
4,280
(122,084)
544,455
(2,454,739)
(2,654,275)
(762,116)
(710,498)
(50,143)
(1,475)
(975,617)
(801,427)
(174,188)
(2)
(1,692,623)
(1,678,658)
(682,370)
(1,112,799)
(300,320)
402,866
(491,093)
(992,542)
(230,010)
34,987
(610,080)
(257,439)
(442)
(277,852)
(21,519)
66,544
(111,097)
(8,275)
(380,222)
(167,046)
(409)
(281,471)
1,685
146,326
(77,863)
(1,444)
5,559,338
INCOME BEFORE TAXES ON INCOME
12
12
12
Income tax
Social contribution tax
Deferred taxes
(577,456)
(202,631)
(439,079)
4,340,172
INCOME BEFORE PROFIT SHARING
Profit sharing
(32,277)
NET INCOME
EARNINGS PER SHARE - R$
5,204,651
(958,430)
(369,581)
(161,406)
3,715,234
(46,199)
4,307,895
3,669,035
4,307,895,000
3,669,035,000
The accompanying notes are an integral part of these financial statements.
5
2010
(Convenience Translation into English from the Original Previously Issued in Portuguese)
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31
(In thousands of Brazilian reais – R$)
2011
2010
4,307,895
3,669,035
(12,037,932)
(4,078,820)
(172,743)
-
10,708
(149)
Realization of adjustment at fair value of securities - own, net of tax effetcs (3)
(386,896)
(1,159,919)
Cumulative translation adjustment of associates (4)
(196,403)
(36,499)
675,752
335,285
(7,799,619)
(1,271,067)
Net income
Adjustment at fair value of securities available for sale - own, net of tax effects (1)
Adjustment at fair value of financial instruments, net of tax effects (2)
Adjustment at fair value of securities available for sale of associates
Other comprehensive income of associates (4)
Total comprehensive income (loss)
(1) R$6,201,359 thousand as at December 31, 2011 and R$2,101,210 thousand as at December 31, 2010
(2) R$88,988 thousand as at December 31, 2011
(3) R$199,310 thousand as at December 31, 2011 and R$597,534 thousand as at December 31, 2010
(4) Includes the effects from prior-years adjustments, in the amount of R$(198,449) thousand as at December
31, 2010.
The accompanying notes are an integral part of these financial statements.
6
(Convenience Translation into English from the Original Previously Issued in Portuguese)
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
STATEMENT OF CHANGES IN EQUITY FOR THE
YEAR ENDED DECEMBER 31, 2011
(In thousands of Brazilian reais – R$)
Capital
Increase
in progress
Capital
st
Capital
Reserve
Tax
Incentive
Reserve
Tax
Incentive
Reserve
Legal
Reserve
1,084,074
191,649
Earnings
reserves
Reserve for
compliance with
accounting policies
As at January 1 , 2011
46,304,356
5,124,505
92,993
Capital increase (Note 14)
11,124,505
(5,124,505)
-
-
-
1,551,864
-
Valuation adjustments to equity
Additional
proposed
dividends
Of
Own
assets
2,949,142
-
29,414,287
(210,925)
-
86,501,945
-
-
6,000,000
-
-
-
(2,949,142)
-
(12,107,514)
-
-
-
-
-
-
Valuation adjustments to equity
-
-
-
-
-
-
-
Net income
-
-
-
-
-
-
-
-
-
4,307,895
Allocation of net income
. Legal reserve
. Reserve for compliance with accounting policies
. Tax incentive
. Dividends
. Capital Increase
-
-
-
(215,395)
(127,953)
(34,372)
(982,544)
(2,947,631)
As at December 31, 2011
57,428,861
-
2,947,631
92,993
215,395
-
34,372
-
127,953
-
-
1,299,469
226,021
1,679,817
-
The accompanying notes are an integral part of these financial statements.
7
Total
-
Dividends - 2010
2,947,631
(2,949,142)
Retained
earnings
Of
Associates
(12,597,571)
16,816,716
490,057
279,132
-
4,307,895
(982,544)
80,770,640
(Convenience Translation into English from the Original Previously Issued in Portuguese)
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
STATEMENT OF CHANGES IN EQUITY FOR THE
YEAR ENDED DECEMBER 31, 2010
(In thousands of Brazilian reais – R$)
Capital
Increase
in progress
Capital
st
As at January 1 , 2010
30,704,356
Capital increase
15,600,000
5,124,505
Capital
Reserve
Tax
Incentive
Reserve
92,993
Tax
Incentive
Reserve
Legal
Reserve
793,454
Earnings
reserves
Reserve for
compliance with
accounting policies
153,918
Valuation adjustments to equity
Additional
proposed
dividends
Of
Own
assets
-
-
-
-
-
-
-
-
Valuation adjustments to equity
-
-
-
-
-
-
-
Net income
-
-
-
-
-
-
-
Allocation of net income
. Legal reserve
. Reserve for compliance with accounting policies
. Tax incentive
. Dividends
. Additional proposed dividends
-
-
-
As at December 31, 2010
46,304,356
5,124,505
92,993
290,620
-
37,731
-
1,551,864
-
2,949,142
1,084,074
191,649
1,551,864
2,949,142
The accompanying notes are an integral part of these financial statements.
8
Retained
earnings
Of
Associates
34,677,427
(335,515)
(5,263,140)
124,590
2,143,370
15,600,000
-
(5,138,550)
-
3,669,035
-
-
(290,620)
(1,551,864)
(37,731)
(983,048)
(2,949,142)
(210,925)
73,354,508
-
-
29,414,287
Total
-
3,669,035
(983,048)
86,501,945
(Convenience Translation into English from the Original Previously Issued in Portuguese)
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
STATEMENTS OF CASH FLOWS FOR THE
YEARS ENDED DECEMBER 31
(In thousands of Brazilian reais – R$)
2011
2010
4,307,895
737,296
3,669,035
(200,486)
Reversal of the allowance for impairment losses
Recognition (reversal) of provisions for labor and civil contingencies
Equity in associates
Adjustments to fair value of securities
Adjustment at fair value on exchange of shares
Adjustment of debt from issued debentures
Depreciation
Gain or loss on investments sales
Realization of valuation adjustments to equity
Recognition of the provision for current and deferred income tax and social contribution, net
Recognition of the allowance for investment losses
Gain (loss) on derivatives
(402,866)
21,519
(1,213,235)
712,221
(357,293)
680,447
8,190
(4,481)
1,219,166
50,143
23,485
(34,987)
(1,685)
(439,349)
330,618
479,673
6,358
(1,056,349)
692,393
174,188
(351,346)
Changes in assets and liabilities
. Decrease in receivables from credit sale of securities and other receivables, net
. Increase in securities, net
. Increase in other assets, net
. Increase (decrease) in borrowings and onlendings, net
. Increase in other liabilities, net
. Dividends and interest on capital of associates received
. Interest on borrowings and onlendings
. Income tax and social contribution paid
(306,311)
2,108,589
(4,976,100)
(553,781)
3,399,660
(311,463)
553,175
(41,288)
(485,103)
(6,804,561)
367,223
(4,106,090)
(747,248)
(1,684,955)
91,222
495,108
(79,778)
(1,140,043)
Net cash provided by (used in) operating activities
4,738,880
(3,336,012)
Cash flows from investing activities
. Sale of investments
. Purchase of investments
15,882
(720,406)
1,565,129
(33,428)
Net cash provided by (used in) investing activities
(704,524)
1,531,701
Cash flows from financing activities
. Repayment of debt from debentures issued
. Issuance of debentures
. Dividends paid
Net cash provided by (used in) financing activities
(902,015)
(4,041,190)
(4,943,205)
(104,156)
2,025,000
(934,944)
985,900
(908,849)
(818,411)
Cash flows from operating activities
Net income
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Decrease in cash and cash equivalents
Changes in financial position
At the beginning of the year
Cash and cash equivalents balance (1)
1,126,479
1,126,479
1,944,890
1,944,890
At the end of the year
Cash and cash equivalents balance (1)
217,630
217,630
1,126,479
1,126,479
Decrease in cash and cash equivalents
(908,849)
(818,411)
Non-cash transactions (Note 24)
. Capital increase
. Financed acquisition of securities
6,000,000
-
15,600,000
22,408,490
(1) Includes Cash and cash equivalents and Banco do Brasil exclusive investment fund shares
The accompanying notes are an integral part of these financial statements.
9
(Convenience Translation into English from the Original Previously Issued in Portuguese)
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
STATEMENTS OF VALUE ADDED FOR THE
YEAR ENDED DECEMBER 31
(In thousands of Brazilian reais – R$)
2011
2010
REVENUES
Financial transactions
Other operating income
Reversal (recognition) of the allowance for losses
3,528,539
1,407,265
1,718,408
402,866
4,951,014
1,072,847
3,843,180
34,987
EXPENSES
Financial transactions
Other expenses
2,097,041
2,095,489
1,552
1,743,486
1,713,645
29,841
131,414
8,743
72,528
50,143
205,268
10,443
50,430
144,395
1,300,084
3,002,260
8,190
8,190
6,358
6,358
1,291,894
2,995,902
4,824,736
1,213,235
3,611,501
2,668,008
439,349
2,228,659
6,116,630
5,663,910
INPUTS PURCHASED FROM THIRD PARTIES
Materials, electric power and other
Outside services
Loss of assets
GROSS VALUE ADDED
RETENTIONS
Depreciation
WEALTH CREATED BY THE ENTITY
WEALTH RECEIVED IN TRANSFER
Equity in associates
Dividends and interests on capital
WEALTH FOR DISTRIBUTION
WEALTH DISTRIBUTED
Employees and related taxes
- Direct compensation
- Benefits
- FGTS
- Others
Taxes and contributions
- Federal
- Municipal
Rental
Dividends
Retained earnings
6,116,630
269,750
167,944
79,606
17,951
4,249
1,517,426
1,515,552
1,874
21,559
982,544
3,325,351
100.0%
4.4%
24.8%
0.4%
16.1%
54.3%
The accompanying notes are an integral part of these financial statements.
10
5,663,910
287,167
166,120
99,440
17,365
4,242
1,697,122
1,695,154
1,968
10,586
983,048
2,685,987
100.0%
5.1%
30.0%
0.2%
17.4%
47.3%
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2010 and 2011
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
1.
General Information
1.1) History
BNDES Participações S.A. (“Company”) is a publicly-held company headquartered in
Brasilia, Federal District, Setor Comercial Sul, BNDES Building, Group 1, Block “J”,
12th and 13th floor. It was organized in 1982 and is a wholly-owned subsidiary of Banco
Nacional de Desenvolvimento Econômico e Social (BNDES). Its operations are based
on the strategic guidelines established together with the BNDES and directed towards
supporting capitalization and development of local companies, which is achieved
basically by holding noncontrolling and temporary interest and strengthening and
modernizing the securities market.
On January 13, 1998, BNDESPAR obtained the publicly-held company registration
from the Brazilian Securities and Exchange Commission (CVM), enabling it to trade its
own securities in the organized over-the-counter market.
1.2) Current purposes
•
•
•
•
•
•
2.
Strengthen corporate capital structures and support new investments in the economy;
Support industrial restructuring through mergers and acquisitions;
Support the development of emerging companies;
Support the development of small and medium-sized businesses;
Develop private equity funds industry; and
Contribute to the development of capital markets.
Basis of Preparation and Presentation of Financial Statements
The financial statements of BNDESPAR have been prepared in accordance with
Brazilian Corporate Law, with the pronouncements, interpretations and guidelines
issued by the Accounting Pronouncements Committee, with the standards established by
the Brazilian Securities and Exchange Commission (CVM) and, when applicable, with
the standards followed by its controlling shareholder, the Banco Nacional de
Desenvolvimento Econômico e Social (BNDES).
These financial statements were approved by the Board of Directors on February 7,
2012.
11
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
3.
Summary of significant accounting policies
The main accounting practices used in the preparation of these financial statements are
defined below. These policies have been applied consistently over all reported periods,
except as otherwise indicated.
3.1) Basis of presentation
The financial statements have been prepared based on the historical cost, except for
financial assets available for sale and financial assets and liabilities (including
derivatives) measured at fair value through profit or loss, which were measured at fair
value.
The preparation of the financial statements in accordance with Brazilian Corporate Law
requires the adoption of certain accounting estimates by Management. The areas
involving the judgment or use of estimates that are relevant to the financial statements
are stated in Notes 6.3, 7.3, 9.3 and 13.
3.2) Investments in associates
Associates are all entities in which BNDESPAR has the power to take part in the
investee’s financial and operational decisions, without individually or jointly controlling
these policies. Significant influence is presumed when BNDESPAR holds 20% or more
of the investee’s voting capital. However, this presumption of influence is ignored when
BNDESPAR does not take part in the investee’s decisions, although it holds 20% or
more of the voting capital.
Management understands that certain equity interests held by BNDESPAR representing
over 20% of voting capital does not give significant influence on such entities mainly
because BNDESPAR does not participate in the preparation of the investee’s
operational and financial policies. On the other hand, Management understands that
BNDESPAR exercises significant influence in entities in which it holds less than 20%
of the voting capital since it influences the operational and financial policies of these
entities.
Investments in associates are recorded under the equity method and initially recognized
at cost and their carrying amount will be increased or decreased based on the recognition
of BNDESPAR's share in the investees’ changes in equity following the acquisition.
BNDESPAR’s share in the profits or losses of its associates is recognized in the income
statement and its share in their other comprehensive income (loss) is recognized directly
in shareholders' equity.
With respect to the adoption of the Equity Method of Accounting, BNDES uses the
associates’ financial statements ended 60 (sixty) days in advance, as prescribed by the
Brazilian Corporate Law and based on the accounting pronouncements, because of the
impossibility to use the financial statements on the same reporting date. This occurs
12
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
because the associates are not part of the BNDES System, with non-integrated
accounting, which requires time for closing purposes; therefore, information cannot be
provided on a timely basis.
For those cases in which BNDESPAR’s share in the losses of an associate is equivalent
to or greater than the carrying amount of the investment, including any long-term assets
which, in the essence, are part of the investment in the associate, BNDESPAR does not
recognize additional losses, unless it had assumed legal or constructive (not formalized)
obligations to make the payments on behalf of the associate.
The associates’ financial statements were adjusted, when applicable, to ensure the
consistency between the accounting practices adopted by the associates and those
adopted by BNDESPAR.
Gains and losses on dilution of or increase in equity interest are recognized in the
income statement when incurred.
The investment in associates includes the goodwill calculated on acquisition, less any
impairment losses. Goodwill is determined by the difference between the amount paid
(or commitment to pay) and the share in the fair value of net acquired assets.
The bargain purchase (negative goodwill) determined on the acquisition of an associate
is recognized in the income statement on acquisition date.
After applying the equity method of accounting, BNDESPAR assesses the need to
recognize any additional impairment loss on the total net investment in each associate,
including goodwill, if any, by comparing its carrying amount and its recoverable amount
(net sales value less the higher of selling costs or value in use). Investments are tested
for impairment semiannually or when there is any indication that the investment might
be impaired.
To determine the recoverable amount, the net sales value of each associate is determined
based on a) the trading price on the BM&FBovespa, less probable selling costs, for
investments in companies whose shares are listed on stock exchanges; or b) pricing
models based on multiples or discounted cash flows, for investments in companies
whose shares are not listed on stock exchanges. The value in use is determined by
calculating the present value of expected earnings (dividends and interest on capital),
plus the expected residual value for future sale of the associate.
The associates' summarized financial information recorded under the equity method is
presented in Note 9.
There is no significant restriction that could limit the ability of the associates to transfer
funds to BNDESPAR as dividends or make payments of loans and/or advances.
13
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
3.3) Operating segments
Operating segments are reported in a manner consistent with the internal reporting
provided to the chief operating decision maker, responsible for the allocation of funds
and evaluation of performance of operating segments, represented by Management.
3.4) Translation of foreign currency-denominated balances
(a)
Functional and presentation currency
The financial information was prepared based on the functional currency, which is
the currency of the main economic environment in which BNDESPAR operates.
The financial statements are presented in Brazilian reais, which is the Company’s
functional and reporting currency.
(b) Transactions and balances
Foreign currency-denominated transactions are recorded, upon initial recognition,
at the Company’s functional currency, subject to the spot foreign exchange rate
between the functional currency and foreign currency on the transaction date.
Exchange rate changes arising from the settlement of these transactions and the
translation of the monetary assets and liabilities into foreign currencies at closing
exchange rates are recognized as gain or loss in the income statement.
3.5) Financial assets
3.5.1) Classification
BNDESPAR classifies its financial assets in the following categories:
measured at fair value through profit or loss, loans and receivables, held-tomaturity and available-for-sale.
The classification depends on the purpose for which the financial assets have
been obtained. Management determines the classification of its financial assets
upon initial recognition and revaluates this classification at the six-month
period or annual balance sheet dates.
(a) Financial assets measured at fair value through profit or loss
This category includes financial assets held for trading and those classified,
upon the initial recognition, as measured at fair value through profit and
loss (fair value option).
The financial assets are classified as held for trading when they are
acquired for such purpose, mainly in the short term (this category includes
14
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
mainly government securities and derivatives); or, upon initial recognition,
when they are part of a portfolio of identified financial instruments
collectively managed by the Company and for which there is a recent
actual pattern of short-term profit taking; or when it is a derivative not
designated as accounting hedge instrument.
A financial asset other than those held for trading can be stated at fair
value through profit or loss upon initial recognition if:
•
This designation eliminates or significantly reduces a measurement or
recognition inconsistency that would otherwise arise; or
•
The financial asset is part of a group of financial assets, financial
liabilities or both and its performance is evaluated on a fair value
basis, in accordance with a documented risk management or
investment strategy of BNDESPAR, and information about the group
is provided internally on that basis; or
•
It is part of a contract containing one or more embedded derivatives,
and CPC 38 - Financial Instruments: Recognition and Measurement
permits that the combined contract as a whole (assets or liabilities) be
designated at fair value through profit or loss.
Financial assets at fair value through profit or loss are stated at fair value
and any gains or losses are recognized in the income statement. Net gains
or losses recognized in income statement include dividends or interest
earned by the financial asset, and are included under caption “Other gains
and losses” in the income statement.
BNDESPAR elected to state the following financial instrument at fair
value through profit or loss:
Debentures with option for conversion or exchange into shares
A portion of the portfolio of debentures held by BNDESPAR has
embedded derivatives (option for conversion or exchange into shares)
which significantly affect its cash flows. For some debentures with option
for conversion or exchange, BNDESPAR understands that it is not
possible to measure the embedded derivative separately.
Accordingly, the Company opted for the designation on transition date and
upon initial recognition, when applicable, at fair value through profit or
loss of these debentures as a whole, without segregating embedded
derivatives.
15
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
(b) Loans and receivables
Non-derivative financial assets with fixed or determinable payments that
are not quoted in an active market. Loans and receivables are measured at
amortized cost using the effective interest method, less the allowance for
impairment losses. Interest income is recognized by applying the effective
interest rate, except for short-term receivables, when the recognition of
interest is immaterial. They are classified as current assets, except those
with maturities exceeding 12 months after the balance sheet date, which
are classified as noncurrent assets.
BNDESPAR’s loans and receivables comprise sales in installments of
securities, receivables and simple debentures.
In BNDESPAR, sales in installments of securities, receivables and simple
debentures represent financial support and are classified in accordance
with Management’s judgment in terms of risk level, considering the
economic scenario, past experience and specific risks related to the
transaction, borrowers and guarantors.
(c) Held-to-maturity financial assets
Correspond to non-derivative financial assets with fixed or determinable
payments, with defined maturities, for which Management has the positive
intent and ability to hold to maturity.
Held-to-maturity investments are recorded at amortized cost under the
effective interest rate method, less impairment losses, when applicable, and
revenues are recognized based on effective compensation.
(d) Available-for-sale financial assets
Correspond to non-derivative financial assets held for an indefinite period
which may be sold in response to liquidity requirements or changes in
interest rates, exchange rates or stock prices. They are classified as
noncurrent assets, unless Management intends to dispose of the investment
within up to 12 months after the balance sheet date.
This category is mainly comprised of government securities, investment
fund units and shares issued by publicly traded or not publicly traded
companies.
16
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Gains and losses arising from the changes in the fair value are recognized
in other comprehensive income, under “Valuation adjustments to equity”,
net of taxes, except for impairment losses, interest calculated based on the
effective interest rate method and exchange gains and losses on monetary
assets, which are recognized directly in the income statement. When the
investment is sold or is impaired, the gain or loss previously recorded
under “Valuation adjustments to equity” is reclassified to the income
statement.
Dividends on available-for-sale equity instruments are recognized in
income statement when BNDESPAR has the right to receive them.
3.5.2) Initial recognition and measurement
The financial assets are recognized when BNDESPAR becomes a party to the
underlying contracts.
All financial assets are initially recognized on the transaction date, when
BNDESPAR agrees to purchase or sell the instrument, except for loans,
advances and regular purchase and sale transactions which require delivery on
the date established based on market practices which is recognized as the
settlement date.
The financial assets measured at fair value through profit or loss are initially
measured at fair value and the related transaction costs and origination
revenues are directly recorded in the income statement. The other financial
assets are originally measured at fair value, plus transaction costs and
origination revenues.
3.5.3) Subsequent measurement
Financial assets classified as available for sale and as measured at fair value
through profit or loss are subsequently measured at fair value. Financial assets
classified as loans and receivables and held to maturity are measured at
amortized cost based on the effective interest rate method.
The effective interest rate method is used to calculate the amortized cost of a
financial asset or liability and allocate interest income or expense in the proper
accrual period. The effective interest rate is the discount rate applied on future
payments or receipts estimated over the estimated life of the financial
instrument. When calculating the effective interest rate, BNDESPAR estimates
the cash flows considering all contractual terms of the financial instrument but
without taking into account future losses on collection of receivables. The
calculation includes possible transaction costs, origination revenues and other
premiums or discounts. When the amount of an asset or group of similar
financial assets is reduced due to impairment losses, interest income is
17
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
recognized based on the effective interest rate, which is used to discount future
cash flows for purposes of measuring impairment.
Gains or losses arising from changes in the fair value of financial assets
measured at fair value through profit or loss are recorded in the income
statement when incurred.
Gains or losses arising from changes in the fair value of financial assets
classified as available for sale are recognized directly in a specific line item in
shareholders’ equity until the financial asset is written off or an allowance for
impairment is recognized.
In this case, the gain or loss recorded in a specific line item in shareholders’
equity is transferred to income or loss for the period. However, interest
calculated based on the effective interest rate method and exchange gains and
losses on monetary assets classified as available for sale are recognized in the
income statement when they incurred. The dividends on equity instruments
classified as available for sale are recognized in income or loss when the entity
is eligible for receiving them.
3.5.4) Write off
Financial assets are written off when the rights on the receipt of cash flows
expire or when BNDESPAR substantially transfers all risks and rewards related
to the ownership of a financial asset.
3.5.5) Reclassification of financial assets:
(a) From available for sale to held to maturity
There is no condition. The reclassification occurs provided that the asset is
in accordance with the requirements for classification as held-to-maturity.
(b) From held to maturity to available for sale
It may occur under rare circumstances, based on specific, unusual,
nonrecurring and unexpected reason after the classification date.
If a reclassification take place, except for the cases described above, all
instruments classified as held to maturity will be reclassified to available
for sale. Additionally, new instruments will not be classified under this
category during the year of such reclassification and the two subsequent
years.
18
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
(c) From held for trading to held to maturity
Under rare circumstances and only in cases of assets that are no longer
held for trading and comply with the requirements for classification as held
to maturity.
(d) From held for trading to available for sale
Under rare circumstances and only in cases of assets that are no longer
held for trading.
(e) From held for trading to loans and receivables
Under rare circumstances and only in cases of assets that are no longer
held for trading and comply with the requirements for classification as
loans and receivables.
(f) From available for sale to loans and receivables
It may occur under rare circumstances and only in cases of assets that are
initially designated under this category and comply with the requirements
for classification as loans and receivables.
BNDESPAR does not reclassify the financial instruments from other
categories to held for trading or stated at fair value through profit or loss,
as well as it does not reclassify financial instruments initially stated at fair
value through profit or loss to another category.
There were no reclassifications of financial assets during the period.
3.5.6) Impairment of financial assets
(a) Assets stated at amortized cost
BNDESPAR assess, at each balance sheet date, the existence of any
objective evidence that an asset or a group of financial assets, stated at
amortized cost, could be impaired.
An asset or group of financial assets is impaired and impairment losses are
incurred when there is objective evidence of impairment as a result of one
or more events that occurred after the initial recognition of the asset
("impairment event") and if this event (or events) has a future impact on
the estimated cash flows that can be reliably estimated.
19
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
BNDESPAR considers the following items as objective evidence of
impairment:
•
•
•
default equal to or greater than 90 days;
customer’s bankruptcy or business reorganization; and
judicial recovery.
Additionally, the following qualitative items should be monitored because
they may evidence impairment:
•
•
•
•
decrease in the risk classification prepared internally;
fraud;
renegotiation affecting the original cash flow from operating activities
(reduction);
loss of contractual warranties.
The estimated period between the event of loss and its identification is set
by Management based on the materiality of the credit, which corresponds to
six months for material credits and twelve months for immaterial credits,
and any extraordinary event in the market that Management considers as
impairment loss on the asset.
Firstly, BNDESPAR assess the existence of objective evidence of
impairment for financial assets that are individually relevant. If there is no
objective evidence of impairment, the financial asset is included in a group
of financial assets with similar credit risks and assessed collectively. The
assets assessed individually and subject to impairment losses are not
included in the collective assessment.
The calculation of the present value of estimated future cash flows of
financial assets, for which there is a guarantee, reflects the cash flows that
might result from the execution of the guarantee, less the costs to obtain and
sell the guarantee, if the execution of the guarantee is probable or remote.
For purposes of collective impairment evaluation, the financial assets are
grouped based on similar credit risk characteristics.
The future cash flows of the group of financial assets that are collectively
assessed for impairment purposes are estimated based on the contractual
cash flows and past losses for those assets with similar credit risk
characteristics. The past losses are adjusted to reflect the effects of current
conditions which did not affect the period in which the past losses were
based and to exclude the effects of conditions in the past period not
currently existing.
20
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The methodology and assumptions used to estimate future cash flows are
reviewed by BNDESPAR on a regular basis to reduce any difference
between estimated losses and current losses.
If impairment losses are reduced in a subsequent period and such reduction
is objectively related to an event occurred after the recognition of the
impairment loss, the loss previously recognized is reversed with a contra
entry to the reduction. The reversal amount is recognized in the income
statement.
(b) Assets classified as available for sale
BNDESPAR determines, at each balance sheet date, the existence of
objective evidence that an asset or a group of financial assets available for
sale is impaired. With respect to the debt instruments, BNDESPAR adopts
the same criteria applicable to financial assets stated at amortized cost. In
the case of equity instruments classified as available for sale, in addition to
the criteria applicable to financial assets stated at amortized cost, the
objective evidence of impairment losses also include the significant or
continuing decrease in the fair value of an instrument below its cost. When
there is that kind of objective evidence of impairment for available-for-sale
financial assets, the accumulated loss - measured as the difference between
the acquisition cost and the fair value on the base date, less any impairment
loss previously recognized for this financial asset - is transferred from
shareholders’ equity to income or loss. The impairment losses recognized
in income or loss for an investment in an equity instrument classified as
available for sale are not subsequently reversed through profit or loss,
while, in the case of a debt instrument, if its fair value increases and such
increase relates to an event occurred after the recognition of the
impairment loss, this loss is reversed through profit or loss.
3.6) Financial liabilities
Financial liabilities are initially recognized at their fair value, plus transaction costs
directly attributable to their acquisition or issuance. After initial recognition, the balance
is measured at amortized cost using the effective interest rate method.
3.6.1) Classification
BNDESPAR classifies its financial liabilities in the following categories: at fair
value through profit and loss and at amortized cost.
Derivatives are basically measured at fair value through profit or loss.
Payable related to debentures issued, borrowings and onlendings and other
payables are measured at amortized cost.
21
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
3.6.2) Initial recognition and measurement
The financial liabilities are recognized when BNDESPAR becomes a party to the
underlying contracts.
The financial liabilities measured at fair value through profit or loss are initially
measured at fair value and the related transaction costs are directly recorded in
income or loss.
The financial liabilities measured at amortized cost are initially measured at fair
value, plus/less transaction costs, premiums and discounts.
3.6.3) Subsequent measurement
Financial liabilities measured at fair value through profit or loss are subsequently
measured at fair value.
Financial liabilities measured at amortized cost are subsequently measured at
amortized cost based on the effective interest rate method.
3.6.4) Write off
Financial liabilities are written off when the related obligations are eliminated,
cancelled or terminated.
3.7) Presentation of financial instruments based on the net position of assets and liabilities
Financial assets and financial liabilities are recorded in the balance sheet at their net
amount only when BNDESPAR has a legally enforceable right and the intent to offset
the receivables against the payables and settle them on a net basis or sell the asset and
settle the liability simultaneously.
3.8) Derivatives
BNDESPAR, when applicable, uses derivatives for hedge purposes in order to adjust its
composition of financial assets and financial liabilities, manage the profile of products
and fulfill other purposes in line with its institutional goals, seeking to obtain financial
management efficiency. BNDESPAR does not use derivatives for speculative purposes
which would intentionally generate unsecured positions.
The hedge strategy consists of covering, either fully or partially, the risks arising from
the changes in fair or market value or the cash flow of any financial asset or financial
liability.
22
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Derivatives are initially recognized at fair value on the date they are contracted and
subsequently measured at their fair value at the end of each reporting period. Possible
gains or losses are immediately recognized in income or loss.
A derivative with positive fair value is recognized as an asset while a derivative with
negative fair value is recognized as a liability. A derivative is classified as noncurrent
asset or liability if its remaining term is greater than 12 months and it is not expected
that it will be sold or settled in a shorter period. Other derivatives are stated as current
assets and liabilities.
Moreover, BNDESPAR uses financial instruments classified as embedded derivatives
as part of some variable income transactions. Such derivatives, such as options for
conversion/exchange of debentures into shares, are embedded in legal instruments
related to the portfolio of securities. These derivatives, when applicable, are segregated
from the main agreements and are also classified as financial assets measured at fair
value through profit and loss.
3.9) Classes of financial instruments
BNDESPAR classifies its financial instruments in classes in accordance with their
nature and characteristics. The classes are as follows:
A) Financial assets
A-1) Measured at fair value through profit or loss
A-1.1) Held for trading
government securities; and derivatives.
A-1.2) Stated at fair value through profit or loss: Debentures
A-2) Loans and receivables:
credit sale of securities;
receivables;
dividends and interest on capital receivable;
debentures.
A-3) Held-to-maturity securities:
government securities.
A-4) Available-for-sale securities:
shares and subscription bonus;
investment fund units; and
government securities.
B) Financial liabilities
B-1) Measured at fair value through profit or loss: Derivatives.
B-2) Measured at amortized cost:
23
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
B-2.1) Funding:
Debentures; and
BNDES and National Treasury onlendings
B-2.2) Other financial liabilities
3.10) Revenue recognition
(a)
Interest income and expenses
Interest income and expenses for all financial instruments subject to interest are
recognized under “financial income” and "financial expenses" in the income
statement based on the effective interest rate method, except for those held for
trading or measured at fair value through profit or loss.
(b)
Revenues from fees and commissions
Revenues from fees and commissions are generally recognized on the accrual
basis when services are provided.
However, revenues from commissions identified as revenues from origination of
financial instruments classified as loans and receivables, available-for-sale and
held-to-maturity are added to the initial fair value of the related financial
instruments and recorded in the income statement under the effective interest
rate method, recognized in the related line items of interest income and expense,
as applicable.
(c)
Dividend income
Dividend income is recognized in income statement when the right to receive the
dividend is established.
3.11) Impairment of financial assets
Non-financial assets with indefinite useful lives, such as goodwill, are not subject to
amortization and are annually tested for impairment. Assets are reviewed for indicators
of impairment whenever significant events or changes in circumstances indicate that
their carrying amounts may not be recoverable.
An impairment loss is recognized when the carrying amount of the asset exceeds its
recoverable amount. The latter is the highest value between the asset’s fair value less
costs to sell and its value in use. For purposes of impairment testing, assets are
grouped at the lowest levels for which there are separately identifiable cash flows
(Cash-generating Units - CGU). Goodwill on the acquisition of an associate is tested
for impairment value together with the investment calculated under the equity method.
24
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The allowance for impairment on non-financial assets, except for goodwill, is
reviewed to determine a potential reversal on the reporting date.
3.12) Cash and cash equivalents
For purposes of the statement of cash flows, cash and cash equivalents include
available funds, short-term repurchase agreements and any other highly liquid shortterm investments, immediately convertible into a known cash amount and which are
not subject to a material risk of change in value.
Short-term transactions comprise those maturing within three months or less as of the
acquisition date.
3.13) Provisions for labor and civil contingencies
The recognition, measurement, and disclosure of contingent assets and contingent
liabilities are made according to the criteria set forth by Resolution CMN no 3823/09
and CVM Resolution no 594/09, which approved CPC 25, issued by the Accounting
Pronouncements Committee (CPC).
Basically, this standard requires the following with respect to contingent assets,
contingent liabilities, and the provision for labor and civil contingencies:
• Contingent assets: are not recognized in the financial statements unless the
realization of income is virtually certain, and the related asset no longer is a
contingent asset and its recognition is required.
• Contingent liabilities: are not recognized in the financial statements and instead a
brief description should be disclosed for each type of contingent liability and, where
practicable: (i) an estimate of its financial effect, (ii) an indication of the
uncertainties relating to the amount or timing of any outflow; and (iii) the
possibility of any reimbursement. Contingent liabilities for which the possibility of
any outflow in settlement is remote are not disclosed.
• Provision: it is a present obligation recognized as a liability, provided that a reliable
estimate can be made and it is probable that an outflow of resources embodying
economic benefits will be required to settle the obligation.
Considering the nature of lawsuits, past experience with similar cases, complexity,
previous court decisions and procedural phase, lawsuits are classified into three
risk categories: maximum, medium and minimum, taking into account the
likelihood of loss, based on the opinion of in-house and outside legal counsel.
25
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Based on the expected loss, the policy adopted to classify ongoing lawsuits is as
follows:
Minimum risk – all lawsuits in lower courts and all appealed favorable lower
court and first appellate court decisions, depending on the appealed issue, are
classified in this category.
Medium risk – all lawsuits with unfavorable lower court and first appellate court
decisions but, depending on the appealed issue, with possibility of reversal of
outcome, are classified in this category.
Maximum risk – all lawsuits with unfavorable lower court or first appellate court
decision, and other lawsuits whose outcome, in light of the issue appealed, will be
hardly reversed, are classified in this category.
In order to align the Bank’s policy with the standards described above, the
following adjustments were made:
Legal criteria
Minimum risk
Medium risk
Maximum risk
Likelihood of loss
Remote
Possible
Probable
Accounting impact
n/a
Disclose
Accrue 100%
Contingent assets are not recognized in BNDESPAR’s financial statements and are
disclosed only when management is certain of their realization or a favorable final and
unappealable court decision is issued or the possibility of an inflow of economic
benefits is high.
3.14) Employees’ benefits
(a)
Pension plan
BNDESPAR offers a supplementary pension plan. The plan is funded by
contributions to a trust fund, calculated using periodic actuarial calculations. The
plan is a defined benefit plan.
Actuarial assets, determined by the actuarial advisors, are not recognized as
sponsor’s assets because these values cannot be offset against future
contributions, as set forth in the pension plan regulation.
The liability recognized in balance sheet is the present value of the defined
benefit obligation at the balance sheet date, less the fair value of plan assets, as
adjusted by actuarial gains or losses and unrecognized past service costs. The
defined benefit obligation is calculated annually by independent actuaries based
on the Projected Unit Credit Method. The present value of the defined benefit
obligation is determined by discounting estimated future cash outflows, using
26
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
interest rates consistent with market yields, which are denominated in the
currency the benefits will be paid and whose maturities are those of the related
pension plan obligation.
Debts contracted between BNDESPAR and the pension plan are considered in
the determination of an additional liability related to the future contributions that
are not recoverable.
Actuarial gains and losses arising from adjustments based on the experience and
changes in actuarial assumptions, that exceed 10% of the amount of the plan’s
assets or 10% of the plan’s liabilities, are deducted from or credited to income or
loss over the expected remaining service period of the employees.
(b)
Medical care plan
BNDESPAR offers a post-retirement health care benefit to their employees. The
right to these benefits is usually contingent to their remaining in employment
until the retirement age and the completion of a minimum length of service. The
expected costs of these benefits are accumulated during the employee period,
and are calculated using the same accounting method used for defined benefit
pension plans.
Actuarial gains and losses arising from adjustments based on the experience and
changes in actuarial assumptions, that exceed 10% of the amount of the plan’s
assets or 10% of the plan’s liabilities, are deducted from or credited to income or
loss over the expected remaining service period of the employees. These
obligations are annually valued by qualified independent actuaries.
(c)
Severance benefits
BNDESPAR recognizes severance benefits when it can be evidenced that it is
committed to the dismissal of current employees according to a detailed formal
plan, which cannot be suspended or canceled, or the grant of severance benefits
as a result of an offer made to encourage voluntary dismissal.
(d)
Profit sharing
BNDESPAR recognizes a profit sharing liability and expense (recorded under
“Profit sharing” in the income statement) based on a formula that takes into
account the income attributable to the single shareholder, BNDES, after certain
adjustments. BNDESPAR recognizes a reserve when it is contractually obliged
or when there is a past practice that created a constructive obligation.
27
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
3.15) Current and deferred income tax and social contribution
Current and deferred income tax and social contribution are recognized in the income
statement, except for the proportion related to items recognized directly in
shareholders’ equity. In this case, taxes are recognized directly in shareholders’ equity.
a)
Current income tax and social contribution
Current income tax and social contribution are calculated based on book income,
adjusted by additions and deductions established by tax law, at the rates effective
on the calculation period. Current income tax and social contribution are
calculated using the laws and regulations enacted at the balance sheet date,
pursuant to Brazilian tax regulations.
b)
Deferred income tax and social contribution
Deferred income tax and social contribution are recognized on the liability
method on temporary differences arising from differences between asset and
liability tax basis and the respective accounting values in the financial
statements. Deferred income tax and social contribution are calculated using the
tax rates (and the tax law) enacted or substantially enacted on the balance sheet
date and that must be applied when the corresponding deferred income tax and
social contribution assets are realized or deferred income tax and social
contribution liabilities are settled.
The main temporary differences arise from the revaluation of certain financial
assets and liabilities, including derivative agreements, provisions for pension
plans and other provisions and post-employment benefits; with respect to
acquisitions, the difference between the fair value of net assets acquired and their
tax basis. However, they are not recorded when resulting from the initial
recognition of an asset or liability related to a transaction which is not a business
combination, which, on the transaction date, does not affect equity or book
income, actual income or tax loss carryforwards.
Deferred taxes are also recognized on temporary differences arising from
investments in associates provided that it is probable that the temporary
difference will not be reversed in a foreseeable future.
With respect to the resulting assets, the recognition takes place when it is
probable that future taxable income will be available to be used for temporary
differences.
Deferred income tax and social contribution, when related to the measurement of
fair value of available-for-sale financial assets, directly debited from or credited
to shareholders' equity, are also deducted from or credited to shareholders' equity
28
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
and, subsequently recognized in income or loss together with deferred gains and
losses from other comprehensive income when realized.
In order to calculate current income tax and social contribution, the Company
adopted the Transitional Tax Regime (RTT), as prescribed by Law 11941/09,
i.e., in computing taxable income the Company adopted the accounting criteria
of Law 6404/76, prior to the amendments prescribed by Law 11638/07. Taxes
on temporary differences arising from adopting the new Brazilian corporate law
were accounted for as deferred tax assets and liabilities.
3.16) Capital
Common stock dividends
The distribution of dividends to a single shareholder is recognized as a liability in the
financial statements at the end of the reporting period, based on the mandatory
minimum amount set forth in BNDESPAR’s bylaws, which corresponds to 25% of the
adjusted net income after recognition of the legal reserve, tax incentive reserve and the
accounting practice adjustment reserve. Any amount above the minimum mandatory
dividend is only accrued on the date it is approved by the Board of Directors.
4.
Fair value of financial assets and financial liabilities
Financial instruments measured at fair value
In order to determine and disclose the fair value of financial instruments BNDESPAR adopts
the following hierarchy:
Level 1: quoted prices in active markets for identical assets and liabilities.
Level 2: quoted prices in active markets for similar instruments or valuation techniques for
which all material inputs are based on observable market data.
Level 3: valuation techniques for which any material input is not based on observable
market data.
There was no transfer between levels.
29
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Measurement at fair value at the end of the periods is as follows:
R$ thousand
Financial assets
Level 1
Cash and cash equivalents
Exclusive investment fund units
Securities
Designated debentures
Available-for-sale debentures
Shares
Investment fund units
Derivatives
Call options
Put options
Total
Financial liabilities
12/31/2011
Level 2
Level 3
Total
-
217,596
-
217,596
61,526,280
-
7,755,148
340,129
8,316,260
2,124,340
2,312,044
419,448
-
10,067,192
340,129
70,261,988
2,124,340
61,526,280
93,891
478,862
19,326,226
2,731,492
93,891
478,862
83,583,998
Level 1
Derivatives
Call options
Total
Level 2
-
Level 3
96,338
96,338
Total
-
96,338
96,338
R$ thousand
Financial assets
Level 1
Cash and cash equivalents
Exclusive investment fund units
Securities
Designated debentures
Shares
Investment fund units
Derivatives
Call options
Put options
Total
Financial liabilities
12/31/2010
Level 2
Level 3
Total
-
1,126,473
-
1,126,473
77,793,235
-
10,448,439
11,116,726
2,022,829
1,595,897
337,807
-
12,044,336
89,247,768
2,022,829
77,793,235
41,346
229,902
24,985,715
1,933,704
41,346
229,902
104,712,654
Level 1
Derivatives
Call options
Total
Level 2
-
483,569
483,569
Level 3
Total
-
483,569
483,569
Total financial assets do not include the value of shares measured at cost. The balances of
these shares totalize R$100 as of December 31, 2011 (R$1.3 as of December 31, 2010).
The fair value of the financial instruments traded in active markets (such as held-for-trading
and available-for-sale securities) is based on market prices at balance sheet date. A market
is considered active if quoted prices are readily and regularly available from an exchange,
dealer, broker, industry group, pricing service, or regulatory agency, and those prices
represent actual and regularly occurring market transactions on an arm’s length basis. These
instruments are included in Level 1, which is mainly comprised of shares issued by
publicly-traded companies.
The fair value of financial instruments not traded in active markets is determined using
valuation techniques. These valuation techniques make maximum use of market inputs,
30
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
where the instrument is available, and rely as less as possible on entity specific estimates. If
all relevant inputs required for the fair value of an instrument are adopted by the market, the
instrument will be included in Level 2.
If one or more relevant inputs are not based on data adopted by the market, the instrument
will be included in Level 3.
Specific valuation techniques used to measure financial instruments include:
-
Quoted market prices or quotations of financial institutions or brokers for similar
instruments.
-
The fair value of debentures with option for conversion/exchange into shares is
calculated based on the projected credit flow at the rates contracted, less the
projected flow at present value at a discount rate comprised of: spread equivalent
to risk-free rate + market risk spread;
-
The fair value of European options, whose underlying assets are traded in stock
exchanges, is calculated based on the following models:
(i) Black-Scholes-Merton, whose main assumptions are:
a.
b.
c.
d.
e.
f.
g.
Initial date: refers to the valuation date, i.e., the closing date of each quarter;
Closing date: maturity date;
Asset price: last average quotation of the underlying asset determined through
the end of the first 15-day period of the base month;
Strike price: projected option strike price on the closing date in accordance
with contractual conditions;
Risk-free rate: fixed nominal rate for government securities issued by the
National Treasury with term compatible with that of the asset under valuation;
Dividend yield: calculated on a case by case basis; generally, defined as the
average over the last years;
Volatility: the annualized volatility based on the daily fluctuation of the
underlying asset over the last four years was adopted as standard.
(ii) Monte Carlo Simulation:
- the fair value of the other options/derivatives whose underlying asset is not traded in
a stock exchange is measured at the fair value of the option based on the difference
between the fair value of the underlying asset - determined on pricing models based
on multiples or discounted cash flow - and the debt balance of the debenture
contract on the base date.
- the fair value of American options, whose underlying assets are not traded in a stock
exchange, is calculated based on the portfolio valuation model.
31
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
5.
Cash and cash equivalents
R$ thousand
12/31/2010
12/31/2011
Cash and cash equivalents
Securities
Banco do Brasil’s exclusive funds*
34
6
217,596
1,126,473
217,630
1,126,479
*Note 6.4
6.
Securities
6.1) Breakdown by category, nature and issuer
R$ thousand
12/31/2011
Without
maturity
Up to 3
months
3 to12
months
1 to 3 years 3 to 5 years 5 to 15 years
Over 15
years
Total
a) Financial instruments at fair value
Public:
Debentures
Private:
Debentures
Available-for-sale financial instruments
Public:
Shares
Private:
Debentures
Shares
Quotas of mutual investment funds
Loans and receivables
Public:
Debentures
Private:
Debentures
Derivatives
-
-
-
167,476
-
-
-
167,476
-
273
273
3,634
3,634
2,162,296
2,329,772
2,742,126
2,742,126
3,305,881
3,305,881
1,685,506
1,685,506
9,899,716
10,067,192
38,029,283
-
-
-
-
-
-
38,029,283
32,332,706
70,361,989
-
-
340,129
340,129
-
-
-
340,129
32,332,706
70,702,118
2,124,340
2,124,340
-
-
-
-
-
-
2,124,340
2,124,340
-
-
-
8,633
268,234
358,565
-
635,432
-
-
-
8,633
722,345
990,579
1,486,347
1,844,912
-
2,208,692
2,844,124
145,505
-
-
427,248
-
-
-
572,753
72,849,430
273
3,634
2,923,802
4,444,257
5,055,960
1,685,506
86,310,527
Allowance for impairment – debentures –
private sector
(12,794)
Total
86,297,733
Current
Noncurrent
Total
282,358
86,015,375
86,297,733
32
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
R$ thousand
12/31/2010
Without
maturity
Up to 3
months
3 to12
months 1 to 3 years 3 to 5 years
5 to 15
years
Over 15
years
Total
Financial instruments at fair value through profit or
loss
Public:
Debentures
Private:
Debentures
Available-for-sale financial instruments
Public:
Shares
Private:
Shares
Quotas of mutual investment funds
-
-
-
145,725
-
-
-
145,725
-
260
260
-
1,396,492
1,542,217
3,356,050
3,356,050
2,611,252
2,611,252
4,534,557
4,534,557
11,898,611
12,044,336
48,230,144
-
-
-
-
-
-
48,230,144
41,018,972
89,249,116
-
-
-
-
-
-
41,018,972
89,249,116
2,022,829
91,271,945
-
-
-
-
-
-
2,022,829
91,271,945
-
-
-
-
47,554
469,976
-
517,530
-
-
-
-
540,913
588,467
469,976
-
540,913
1,058,443
100,497
-
-
170,751
-
-
-
271,248
91,372,442
260
-
1,712,968
3,944,517
3,081,228
Loans and receivables
Public:
Debentures
Private:
Debentures
Derivatives – Private sector
Allowance for impairment – debentures – private sector
4,534,557 104,645,972
(342)
Total
104,645,630
Current
Noncurrent
Total
182,221
104,463,409
104,645,630
6.2) Cost and fair values and breakdown by issuer
R$ thousand
12/31/2010
12/31/2011
Cost
Fair value
Cost
Fair value
a) Financial instruments at fair value through profit or loss
Public:
Debentures
Private:
Debentures
137,973
167,476
137,973
145,725
10,363,958
10,501,931
9,899,716
10,067,192
12,162,856
12,300,829
11,898,611
12,044,336
28,921,039
38,029,283
29,011,438
48,230,144
601,860
16,959,941
46,482,840
340,129
32,332,706
70,702,118
-
-
15,608,630
44,620,068
41,018,972
89,249,116
2,124,340
48,607,180
2,124,340
72,826,458
2,022,829
46,642,897
2,022,829
91,271,945
635,432
635,432
517,530
517,530
2,208,692
2,844,124
2,208,692
2,844,124
540,913
1,058,443
540,913
1,058,443
-
572,753
61,953,235
86,310,527
(12,794)
(12,794)
(342)
61,940,441
86,297,733
60,001,827
Available-for-sale financial instruments
Public:
Shares (*)
Private:
Debentures
Shares (*)
Quotas of mutual investment funds (Note 6.5)
Loans and receivables
Public:
Debentures
Private:
Debentures
Derivatives
Gross Total
Allowance for impairment – debentures – private sector
Total net of allowance
(*)The composition of these shares is described in Note 9.3
33
60,002,169
271,248
10,645,972
(342)
104,645,630
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
12/31/2011
Summary per issuer
Public
Private
Total
38,832,191
47,465,542
86,297,733
R$ thousand
12/31/2010
48,893,399
55,752,231
104,645,630
6.3) Debentures
Debentures with embedded derivatives were classified as financial instrument at fair
value through profit or loss and simple debentures were classified as loans and
receivables as follows:
12/31/2011
R$ thousand
12/31/2010
Financial instruments at fair value
Available-for-sale financial instruments
Loans and receivables
Gross amount
Allowance for impairment
Total
10,067,192
340,129
2,844,124
13,251,445
(12,794)
13,238,651
12,044,336
1,058,443
13,102,779
(342)
13,102,437
Current
Noncurrent
Total
3,907
13,234,744
13,238,651
260
13,102,177
13,102,437
12/31/2011
R$ thousand
12/31/2010
¹see Note 9.2.1
6.3.1) Gross portfolio per sector
Public sector
Private sector
Industry
Other services
Total
802,908
663,255
5,041,798
7,406,739
12,448,537
6,428,836
6,010,688
12,439,524
13,251,445
13,102,779
6.3.2) Gross portfolio per maturity
R$ thousand
12/31/2011
Falling due:
2012
2013
2014
2015
2016
After 2016
Total
3,907
1,818,938
859,596
3,150,429
582,277
6,836,298
13,251,445
R$ thousand
12/31/2010
Falling due:
2011
2012
2013
2014
2015
After 2015
Total
260
7,545
1,534,673
12,004
3,932,513
7,615,784
13,102,779
34
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
6.3.3) Reconciliation of changes in impairment
12/31/2011
(342)
(12,452)
(12,794)
Balance at the beginning of period
Recognition (reversal) *
Balance at the end of period
R$ thousand
12/31/2010
(76)
(266)
(342)
*The effect on the statement of income is shown in Note 16.
6.3.4) Debentures portfolio
The main debentures are listed below by classification and fair value.
Management calculates the fair value of debentures based on assumptions and
judgments that, although being periodically reviewed, can differ from the actual
value
Classification
Loans and receivables
Debentures with loan features
Available for sale
Debentures mandatorily convertible into shares
Stated at fair value through profit or loss (Note 20)
Debentures convertible into/exchangeable for shares listed in stock exchanges
Debentures convertible into/exchangeable for shares not listed in stock exchanges
Total debentures
12/31/2011
R$ thousand
12/31/2010
2,844,124
1,058,443
340,129
-
7,755,148
2,312,044
10,067,192
10,448,439
1,595,897
12,044,336
13,251,445
13,102,779
6.4) Banco do Brasil exclusive investment fund
The Fund is classified as a financial instrument at fair value through profit or loss held
for trading.
The Fund’s portfolio consists basically of government securities issued by the National
Treasury and under the custody of Special Settlement and Custody System - SELIC.
The breakdown of the Fund’s portfolio is as follows:
12/31/2011
R$ thousand
12/31/2010
BB Extramercado Exclusive Fund
ASSETS
Cash and cash equivalents
Repurchase agreements
Treasury bills - LFT
Tradable securities
Treasury bills - LFT
Other
LIABILITIES
Payables
TOTAL
35
2
1,997
15,721
186,946
201,904
1
217,628
937,656
1
1,126,600
(32)
(32)
(127)
(127)
217,596
1,126,473
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Breakdown of the securities included in the Funds’ assets by maturity:
R$ thousand
12/31/2011
Number
BB Extramercado Exclusive Fund
Repurchase agreements
Treasury bills – LFT
Tradable securities
Treasury bills – LFT
Up to 3
months
3 to12
months
1 to 3
years
3 to 5
years
4
15,721
-
-
40,211
15,721
-
114,222
114,222
Total Market
5 to 15
years
Total Cost
-
15,721
15,721
30,127 57,555
30,127 57,555
201,904
217,625
201,892
217,613
-
R$ thousand
12/31/2010
Fundo BB Extramercado Exclusivo
Repurchase agreements
Treasury bills – LFT
Tradable securities
Treasury bills – LFT
Number
Up to 3
months
3 to12
months
1 to 3
years
41,636
186,946
-
-
208,468
1,565
188,511
62,677
62,677
289,966
289,966
3 to 5
years
541,978
541,978
5 to 15
years
Total Market
-
186,946
186,946
937,656
1,124,602
937,650
1,124,596
41,470
41,470
Total Cost
6.5) Investment fund shares
These investments are managed by private financial institutions. Shares of these funds
are valued based on the share value disclosed by the fund manager on the balance sheet
date.
Fund
- PROT – Fundo de Investimento em Participações
- Brasil Energia – Fundo de Investimentos em Participações
- Fundo de Investimento em Direitos Creditórios – Corporativo Brasil
- InfraBrasil – Fundo de Investimentos em Participações
- AG Angra Infra-Estrutura – Fundo de Investimento em Participações
- Fundo de Investimentos Cia. Paulista Trens Metropolitanos
- Logística Brasil – Fundo de Investimento em Participações
- Fundo de Invest. Em Partic. Governança e Gestão – FIPGG
- Fundo de Investimento em Participações Caixa Modal Oleo e Gas
- FIP Terra Viva - Fundo de Investimento em Participações
- Fundo Brascan de Petróleo e Gás
- Brasil Mezanino Infra-estr fdo. Inv. em Participações
- Fundo Mútuo Invest em Empresas Emergentes CRIATEC
- Fundo de Investimento em Participações Caixa Ambiental
- BR Educacional Fundo de Investimento em Participações
- CRP VI Venture Fundo Mútuo de Invest. Empr. Emergentes
- RB Cinema I – Fundo Financiamento Ind. Cinematográfica Nacional
- Fundo Brasil Agronegócio - Fundo de Investimento em Participações
- Vale Florestar Fundo de Investimento em Participações
- Fundo Brasil Sustentabilidade
- Fundo Empreendedor Brasil
- Other
Total
Manager
Mellon Serviços Financeiros Distribuidora de Títulos
Mobiliários S.A.
Banco Bradesco S.A
Credit Suisse Brasil
Banco ABN Amro Real S.A.
Banco Bradesco S.A
Banco Bradesco S.A
Banco Bradesco S.A.
Governança & Gestão Investimentos
Caixa Econômica Federal
DGF Gestão de Fundos Ltda
Banco Brascan S.A.
Darby Stratus Administração de Investimentos Ltda
BNY Mellon Serviços Financeiros Distribuidora de Títulos
e Valores Mobiliários S.A
Caixa Econômica Federal
BEM - Distribuidora de Títulos e Valores Mobiliários Ltda.
CRP Companhia de Participações S.A
Rio Bravo Investimentos S.A.
Banco Bradesco S.A
Citibank Distribuidora de Titulos e Valores Mobiliários S.A
BEM - Distribuidora de Títulos e Valores Mobiliários Ltda.
BEM - Distribuidora de Títulos e Valores Mobiliários Ltda.
36
R$ thousand
12/31/2011 12/31/2010
555,565
668,473
306,672
285,665
187,929
150,033
40,561
56,316
31,606
32,738
29,712
14,665
41,865
315,427
298,196
151,751
82,253
55,412
56,889
38,778
18,502
29,494
16,728
22,550
35,551
22,803
35,266
42,798
33,953
10,464
21,552
61,868
34,289
14,522
100,750
2,124,340
31,522
36,074
12,203
11,413
6,880
36,248
3,111
10,626
97,496
2,022,829
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The mutual investment fund in emerging companies Brasil 21 – Fundo Mútuo de
Investimento em Empresas Emergentes – was established as a closed fund, with capital
contributions from BNDESPAR only and duration term of eight years. This fund is in
divesture process.
7.
Credit sale of securities and receivables
Information on credit sale of securities and receivables is summarized as follows:
12/31/2011
R$ thousand
12/31/2010
Credit sale of securities
Allowance for impairment
1,363,815
(90,702)
1,273,113
1,371,692
(3,144)
1,368,548
Receivables
Allowance for impairment
46,579
(10,700)
35,879
1,676,263
(30,096)
1,646,167
218,293
1,090,699
1,308,992
302,302
2,712,413
3,014,715
Current
Noncurrent
Total
7.1) Distribution of the gross portfolio of credit sales of securities and receivables per sector
12/31/2011
Public sector (*)
Private sector
Industry
Other services
Total
R$ thousand
12/31/2010
217,007
91,770
957,449
235,938
1,193,387
1,264,567
1,691,618
2,956,185
1,410,394
3,047,955
(*) Includes the amount of R$86.9 (R$91.8 as of December 31, 2010) of operations with the controlling shareholder
– BNDES, see note 15.
7.2) Distribution of the gross portfolio of credit sales of securities and receivables by
maturity date
R$ thousand
12/31/2011
2,631
Past due
Falling due:
2012
2013
2014
2015
2016
After 2016
Total
232,848
252,253
334,092
117,505
140,545
330,520
1,410,394
37
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
R$ thousand
12/31/2010
Falling due:
2011
2012
2013
2014
2015
After 2015
Total
304,062
290,038
345,258
464,221
158,974
1,485,402
3,047,955
7.3) Reconciliation of the changes in impairment of credit sales of securities and
receivables:
a) Credit sale of securities
12/31/2011
(3,144)
(87,558)
(90,702)
Balance at the beginning of period
Recognition (reversal)
Balance at the end of period
R$ thousand
12/31/2010
(14,669)
11,525
(3,144)
a) Receivables
12/31/2011
(30,096)
19,396
(10,700)
Balance at the beginning of period
Recognition (reversal)
Balance at the end of period
R$ thousand
12/31/2010
(4,815)
(25,281)
(30,096)
The effect on the statement of income is shown in Note 16.
8.
Dividends and interest on capital receivable
In accordance with the Material Fact Notice disclosed on January 22, 2010, Eletrobrás
reported to the market that its Advisory Board approved the settlement of the special reserve
balance related to undistributed mandatory dividends arising from net income between 1979
and 1998, in the total amount of R$10,285, whose payments are scheduled to be made in
four annual installments from June 30, 2010 to June 30, 2013. BNDESPAR was entitled to
receive the gross amount of R$2,171. Through December 31, 2011, R$850 had been paid
and the outstanding balance amounted to R$1,321.
38
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
As at December 31, 2011, the balance adjusted based on the SELIC rate fluctuation, net of
taxes, is broken down as follows:
12/31/2011
9.
R$ thousand
12/31/2010
Dividends receivable – Eletrobrás
Other companies
Current
660,705
476,924
1,137,629
591,924
133,621
725,545
Dividends receivable – Eletrobrás
Noncurrent
660,705
660,705
1,183,848
1,183,848
Dividends receivable – Eletrobrás
Other companies
Total
1,321,410
476,924
1,798,334
1,775,772
133,621
1,909,393
Investments
The portfolio of equity investments consists of associates, on which BNDESPAR has
significant influence, and other companies on which it has no influence.
The interest in associates is presented as investments under caption “Interest in associates”,
and the interest in companies measured at fair value is presented as securities under caption
“Shares and subscription warrants”, defined as “available for sale” by CPC 38.
The components of the equity investments portfolio of BNDESPAR - associates and
available-for-sale financial instruments - arise from financial support transactions of the
BNDES System, whose general focus is a long-term perspective.
In order to present these assets as they are managed, we provide below the breakdown of
these investments as a portfolio of equity interests.
9.1) Breakdown
12/31/2011
Associates accounted for under the equity method
R$ thousand
12/31/2010
19,332,192
13,641,374
132,946
81,464
Securities – companies at fair value (available for sale) – noncurrent assets
70,229,043
89,167,652
Total investments
89,694,181
102,890,490
Securities – companies at fair value (available for sale) – current assets
9.2) Investments - Associates accounted for under the equity method
The companies where BNDESPAR has the power to take part in financial and
operational decisions, without individually or jointly controlling these policies
(significant influence) are accounted for under the equity method.
39
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2010 and 2011
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
9.2.1) Associates portfolio
R$ thousand
Equity in subsidiaries
Investimento
12/31/2011
Number of shares held
(in thousands)
Investees
Brasiliana
COPEL
Fibria
JBS
Rio Polímeros
Telemar Part.
Base date
10.31.2011
10.31.2011
10.31.2011
10.31.2011
Capital
Common
Preferred
% equity
investment
2,960,708
6,910,000
8,379,397
21,506,247
300,000
38,299
142,360
931,070
50,000
27,282
-
53,85
23,96
30,45
31,41
Subtotal
12/31/2011
Goodwill
a
Allowance for losses
b
760,816
311,033
82,688
99,219
1,253,756
320,733
207,331
109,389
22,628
(231,412)
(68,782)
359,887
2,391,431
2,840,937
4,705,596
6,554,280
16,492,244
908,847
908,847
a
(40.521)
79,462
1.763.429
167,672
256,463
(88,791)
1,076,519
a
b
Other Companies
Total
12/31/2010
Book value of
investment
12/31/2010
1,213,235
439,349
18,255,673
Total
Total
2,391,431
2,840,937
4,705,596
7,463,127
17,401,091
1,646,789
2,275,172
4,703,324
4,083,577
12,708,862
1.931.101
932.512
19,332,192
13,641,374
•
The reporting date indicates the investee’s shareholders' equity date used in the last calculation of equity in investees. The effects of material events that occurred after the reporting date, as well as the effects of Law nº
11638/07 and CPC Technical Pronouncements on the associates’ financial statements have been recognized. The information on associates described in item 9.2.2 below already includes those effects.
•
In 2010 BNDESPAR sold all shares of Rio Polímeros and a portion of its shares of Telemar Participações; therefore, it lost significant influence over the latter. The remaining investment in Telemar Participações was
classified as “Securities available for sale”.
•
As at December 31, 2010, investments were measured based on the balance sheet of associates as at October 31, 2010 and, through that date, public utility companies did not fully adopt the CPC, in particular ICPC 01 –
Concession Arrangements, and did not report the potential effects from applying OCPC 05 – Concession Arrangements, approved by CVM Resolution 657/10, of December 28, 2010. Beginning December 31, 2010, the
aforementioned companies restated their 2010 interim financial statements upon the full adoption of the CPCs, whose impacts on BNDESPAR were the increase in shareholders' equity and increase in net income (loss)
by approximately R$755 and R$23, respectively. These effects were not considered as material in respect of BNDESPAR’s shareholders’ equity.
•
Effects from changes in interest in associates were recorded under profit or loss.
•
Regardless of the fact that BNDESPAR holds 53.85% interest in Brasiliana’s capital, it holds less than 50% of its voting capital and does not govern Brasiliana’s operating and financial policies; therefore, it does not
hold the controlling stake.
•
In July 2011 BNDESPAR converted debentures issued by JBS held by it into 493,968 thousand shares of this associate, equivalent to R$3,478, thus increasing its stake from 17.60% to 31.35%. The increase in the
number of shares held in treasury by the associate in the 4th quarter of 2011 raised the percentage interest, used to calculate equity in subsidiaries, to 31.41%.
•
Investments in associates have been tested for impairment as at December 31, 2011, in accordance with CPC 01 - Impairment of Assets. In the year ended December 31, 2011, the Company recognized R$124 thousand
as revenue from reversal of the allowance for impairment losses on investments in associates, net of expenses on the recognition of allowance of R$35. In the year ended December 31, 2010, the Company recognized an
expense of R$28. The recoverable value of an asset is the higher of its fair value and value in use.
•
The carrying amount of the investment in JBS S/A includes the goodwill from expected future earnings in the amount of R$909. The recoverable amount of the investment, including goodwill, was determined based on
the value in use, calculated using the residual value that is expected from the sale of the investment, which is obtained by means of the investee’s projected cash flow models for the next five years, based on the
consolidated financial statements for the 3rd quarter of 2011, adjusted to present value at the entity’s weighted average capital cost. Cash flow was projected using own and market assumptions, the investee’s past
performance and future economic expectations. No impairment losses were identified since the value in use is higher than the carrying amount of the investment.
•
In accordance with CPC 18, in the year ended December 31, 2011, BNDESPAR no longer recognized losses on investments in associates with shareholders’ deficit, in the amount of R$21 (R$7 in the year ended
December 31, 2010). Unrecognized accumulated losses amounted to R$117 as at December 31, 2011 (R$96 as at December 31, 2010). No reserve was recognized since BNDESPAR has no legal or constructive
obligation to settle the associates’ potential liabilities.
40
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2010 and 2011
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
9.2.2) Information on associates
Carrying amount - R$ thousand – Reporting Date: 10/31/2011 (1)
Investees
Brasiliana (2)
COPEL
Fibria
JBS
Subtotal
Other companies
Total
(1)
(2)
Assets
5,714,647
13,237,532
27,510,856
34,196,278
80,659,313
10,132,577
90,791,890
Liabilities
1,273,416
1,382,870
12,055,031
13,329,333
28,040,650
4,918,611
32,959,261
Shareholders’
equity
4,441,231
11,854,662
15,455,825
20,866,945
52,618,663
5,213,966
57,832,629
Revenue
1,239,565
2,491,666
4,763,097
13,271,227
21,765,555
4,085,434
25,850,989
Income
or loss
1,133,635
1,322,647
269,593
(226,194)
2,499,681
71,002
2,570,683
Fair value of investments
in listed associates
12/31/2011
2,310,303
1,958,793
5,660,903
9,929,999
562,532
10,492,531
Carrying amounts adjusted for the calculation of equity in investees, as mentioned in item 9.2.1.
Not listed company.
9.3) Securities – investments in companies stated at fair value (available for sale)
CPC`s Technical Pronouncements approved by the Brazilian Securities and Exchange
Commission, following the International Financial Reporting Standards (IFRS),
establish that the equity interests in entities that are not subsidiaries, jointly controlled
entities or associates must be treated as financial instrument, through the adoption of
the fair value method for measurement purposes.
After initial recognition, BNDESPAR classifies equity interests in other companies as
“Available for sale” and measures the investment at fair value on the trading date, plus
transaction costs directly attributable to the acquisition or issuance of the instrument.
After the initial recognition, these investments are measured at their fair values,
without any deduction of the transaction costs that might be incurred on sale or
disposal. Changes in the fair value of equity interests in other companies are
recognized directly in BNDESPAR’s shareholders’ equity, in line item “Valuation
adjustments to equity”. These changes in fair value correspond to unrealized economic
gains or losses, recognized in the statement of comprehensive income.
BNDESPAR considers the following hierarchy to determine and disclose the amount
of equity investments classified as “Available for sale”:
•
Level 1: applied to companies whose shares are listed in a stock exchange, the fair
value of which is based on the average closing price in the last trading session of
the reference month;
•
Level 2: applied to holding companies whose shares are not listed in a stock
exchange, but whose main asset is represented by shares of listed companies, the
fair value of which is based on the average closing price in the last trading session
of the stock exchange on which the company’s assets were traded, adjusted for
other assets, liabilities, and low liquidity, if applicable;
•
Level 3: applied to companies whose shares are not listed in a stock exchange, the
fair value of which is determined, on the reference date, using pricing models
based on market multiples or the discounted cash flow;
41
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
•
Value at cost: applied to companies whose shares are not listed in a stock
exchange and that present a wide range of possible fair values acceptable for the
reference date in the context of the valuation effort set out in Level 3, when it is
not possible to determine the probability associated to the estimates that form such
range, to which the acquisition cost is attributed.
9.3.1) Portfolio of securities – Investment in available-for-sale shares
R$ thousand
Number of shares held
(in thousands) as of
12/31/2011
Common
Preferred
interest on
capital as of
12/31/2011 - %
12/31/2011
12/31/2010
778,961
87,456
291,398
604,560
575,684
717,792
382,390
308,031
474,696
2,113,874
3,711,994
462,835
767,796
164,655
381,117
694,436
885,259
405,851
164,409
147,074
32,641,969
338,215
115,281
276,869
187,191
189,573
11,250,504
59,119,870
2,406,410
61,526,280
1,270,009
7,352
305,196
609,657
903,633
789,571
310,601
505,190
848,988
1,686,318
4,742,631
470,390
923,975
153,164
445,071
634,267
780,192
97,083
738,919
278,230
251,633
41,865,559
408,564
161,236
281,730
169,760
354,521
15,434,023
75,427,463
2,365,772
77,793,235
8,316,260
11,116,726
LEVEL 3 – Unlisted companies (fair value)
419,448
337,807
Cost – Unlisted companies (value at cost)
100,001
1,348
TOTAL
70,361,989
89,249,116
Current
Noncurrent
132,946
70,229,043
81,464
89,167,652
INVESTEES
LEVEL 1 – Listed companies
AMÉRICA LATINA LOGÍSTICA S.A. – ALL
BANCO DO BRASIL S.A.
BRADESCO
BRASIL FOODS
BRASKEM S.A.
CEG
CEMIG
CESP
CIA SIDERÚRGICA NACIONAL
CPFL
ELETROBRÁS
EMBRAER
GERDAU
IOCHPE
ITAÚ UNIBANCO HOLDING
KLABIN
LIGHT
LLX
MARFRIG
PARANAPANEMA
PDG REALTY
PETROBRAS
REDE ENERGIA
TELE NORTE LESTE PARTICIPAÇOES
TOTVS
TRACTEBEL
USIMINAS
VALE
Subtotal Level 1
Other companies – Level 1
Total Level 1
(1)
83,940
3,696
16,761
17,944,799
485
31,774
81,053
180,758
39,762
37,917
6,419
30,632
48,201
54,986
24,718
173,400
775
8,344
6,225
218,386
9,523
44,317
11,147
9,348
18,691
21,218
11,259
87,903
1,341,349
67,643
5,627
18,549
68,276
12,21
0,13
0,25
1,92
5,53
34,56
1,70
2,85
2,18
8,42
14,75
5,37
3,44
6,77
0,25
9,58
15,02
13,89
17,23
2,20
11,61
15,86
1,34
5,23
0,95
1,83
5,34
LEVEL 2 – Unlisted holding companies
(1) Although interest percentage exceed 20% of capital, there is no significant influence on the management of these investees.
10. Onlendings
10.1) Breakdown
R$ thousand
12/31/2011
Local currency
BNDES
STN
Total
8,710,955
2,884,850
11,595,805
Foreign currency
38,526
38,526
Total
8,749,481
2,884,850
11,634,331
46,106
11,588,225
11,634,331
Current
Noncurrent
Total
42
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
R$ thousand
12/31/2010
Local currency
BNDES
STN
Total
11,642,000
2,584,529
14,226,529
Foreign currency
49,430
49,430
Total
11,691,430
2,584,529
14,275,959
872,280
13,403,679
14,275,959
Current
Noncurrent
Total
Onlendings from the BNDES are subject to monetary adjustment based on the TJLP
(long-term interest rate), exchange variation or the IGP-M (General Market Price
Index) plus annual interest of up to 10.09%. The major maturity term is in 2018.
Onlendings from the National Treasury are subject to monetary adjustment based on
SELIC and its major maturity term is in December 2017.
10.2) Onlendings from the BNDES and the National Treasury (STN) by maturity:
R$ thousand
12/31/2011
Falling due:
2012
2013
2014
2015
2016
After 2016
Total
46,106
1,309,230
2,297,645
2,293,372
2,293,372
3,394,606
11,634,331
R$ thousand
12/31/2010
Falling due:
2011
2012
2013
2014
2015
After 2015
Total
872,280
15,183
1,431,261
2,678,716
2,674,920
6,603,599
14,275,959
11. Issued debentures
In December 2006, BNDESPAR issued 600,000 simple, registered, book-entry,
nonconvertible debentures of a single series, without guarantee or preference (nonprivileged), with a unit par value of R$1,000.00 on the issue date, totaling R$600.
This public distribution took place under the First Program of Public Distribution of
Debentures of the Issuing Company, filed at the Brazilian Securities and Exchange
Commission (CVM), on December 19, 2006, under nº CVM/SRE/PRO/2006/0011.
43
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Debentures were subscribed and paid up at the price of R$898.33 each (eight hundred and
ninety-eight Brazilian reais and thirty-three centavos), corresponding to a unit par value of
R$1,000.00, adjusted considering a 10.167% discount determined during the book building
process.
The unit par value of debentures will be adjusted from the date of subscription and payment,
based on the IPCA (broad consumer price index), calculated and released by the Brazilian
Institute of Geography and Statistics (IBGE). The result of the adjustment is automatically
added to the par value, under the formulas set forth in the indenture. Debentures will pay
interest of 6% per year on their adjusted par value, at the end of each capitalization period.
The interests were paid on January 15, 2009, January 15, 2010, January 15, 2011, and the
last payment will be on January 15, 2012, as established in the indenture. The amortization
will be paid in a single installment, on the maturity date, January 15, 2012.
In the second distribution, made on July, 2007, BNDESPAR issued 1,350,000 simple,
registered, book-entry, nonconvertible debentures in two series, of which 550,000
debentures of the First Series and 800,000 debentures of the Second Series, with no
guarantee nor preference (that is, ordinary or non-privileged), with a unit par value of
R$1,000.00 on the issuance date, totaling R$1,350. These debentures were subscribed and
paid up at their unit par value.
In December 2009, under the scope of the Second Distribution Program, filed at CVM on
July 29, 2008, under CVM/SER/PRO/2008/007, the fourth public offer of simple debentures
issued by BNDESPAR was completed. BNDESPAR issued 1,250,000 simple debentures, in
the same type and class of the previous issues, in two series, of which 640,000 debentures of
the First Series and 610,000 debentures of the Second Series, with par unit of R$1,000.00,
on issuance date, totaling R$1,250. These debentures were also subscribed and paid at their
unit par value.
The unit par value of the First Series debentures of the Distributions made in 2007 and 2009
is not adjusted, bearing only fixed interest that are paid together with the amortization on the
maturity dates as shown in the table below The interest and the amortization of the
debentures of the First Series issued in 2007, as well as its amortization, were fully paid on
January 3, 2011.
The unit par value of the Second Series debentures issued in 2007 and 2009 is adjusted
based on the IPCA (broad consumer price index), calculated and released by IBGE. The
result of the adjustment is automatically added to the par value, under the formulas set forth
in the Supplemental Indenture.
Over the unit par value of the Second Series debentures of 2007 and 2009, adjusted for
inflation, is added a fixed interest, since subscription and payment date, or the previous
payment date of the Second Series Interest, as applicable, until the date they are effectively
paid. Second Series interest of both issuances are calculated according to the formula set
forth in the Indenture.
44
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The first, second and third interest payments for the Second Series of the 2007 issue were
made on August 17, 2009, August 16, 2010, and August 15,2011, respectively, and the other
payments will be made on August 15, 2012 and on the maturity date, August 15, 2013, when
it will be repaid in one single installment. The interest payments for the Second Series of the
2009 issue will be made annually beginning on January 15, 2012 until January 15, 2015,
when it will be repaid in one single installment.
In December 2010, it was conducted the fifth public offering of BNDESPAR debentures, the
first under the Third Distribution Program. Three series were issued, a fixed rate series (First
Series), a quarterly floating rate series (Second Series), and a series indexed to IPCA (Third
Series). The first, second, and third series were approved by and registered with CVM on
December 10, 2010 under the following identification CVM/SRE/DEB/2010/033,
CVM/SRE/DEB/2010/034, and CVM/SRE/DEB/2010/035, respectively.
The offering was closed on December 17, 2010, with the distribution of 2,025,000 simple,
registered, book-entry, nonconvertible, unsecured debentures, in the total nominal amount of
R$2,025. The distribution consisted of 500,000 First Series debentures, 1,000,000 Second
Series debentures, and 525,000 Third Series debentures.
The unit face value of the debentures in the First and Second Series are not adjusted and are
subject to fixed-rate interest (First Series) and quarterly floating rate interest (Second Series).
The yield of both series as well as their amortization will be paid in full at the related
maturity dates.
The Second Series will yield floating interest consisting of a fixed three-month rate reset on
a quarterly basis using the surcharge of 0.30% per year to be added to the interest rate of
Interbank deposits (DI) futures contracts (traded on the BM&FBOVESPA) applicable to
each quarterly capitalization period. The capitalization periods and the interest calculation
formula of the Third Series are set forth in the Indenture.
The unit face value of the Third Series debentures of this last issuance will be adjusted using
the IPCA fluctuation, and the adjustment will be automatically added to the face value with
the formula set forth in the Indenture. This unit face value adjusted for inflation is subject to
fixed-rate interest from the date of subscription and payment or the previous date of Third
Series Interest payment, as applicable, to the date of actual repayment. The Third Series
interest will be determined in accordance with the formula set forth in the Indenture.
Interest payments for the Third Series of the 2010 issue will be made annually from January
15, 2013 until January 15, 2017, when it will be repaid in a single installment.
The adjusted amount of liabilities arising from the issuance of debentures, the maturity
dates, and the interest corresponding to each series are as follows:
45
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Maturity
First distribution - First Program
Adjusted principal (IPCA)
Accrued interest (6% p.y.)
Discount
Accumulated amortization of discount (1)
12/31/2011
R$ thousand
12/31/2010
01.15.2012
782,234
44,828
(61,002)
60,018
826,078
734,784
42,109
(61,002)
48,211
764,102
-
550,000
240,141
1,016,421
25,795
1,042,216
954,766
23,975
1,768,882
640,000
176,562
640,000
84,288
699,321
104,024
1,619,907
656,901
47,833
1,429,022
500,000
66,246
500,000
3,384
1,000,000
125,334
1,000,000
5,571
561,320
37,096
2,289,996
527,269
1,536
2,037,760
Total
5,778,197
5,999,766
Current
Noncurrent
Total
955,897
4,822,300
5,778,197
306,224
5,693,542
5,999,766
Second distribution
1st series
Principal
Accrued interest (11.2% p.y.)
2nd series
Adjusted principal (IPCA)
Accrued interest (6.8% p.y.)
01.01.2011
08.15.2013
First distribution - Second Program
1st series
Principal
Accrued interest (12.74% p.y.)
2nd series
Adjusted principal (IPCA)
Accrued interest (7.078% p.y.)
01.01.2013
01.15.2015
First distribution – Third Program
1ª series
Principal
Accrued interest (12.51% p.y)
2ª series
Principal
Accrued interest (DI Futures 3 month + 0.30% p.y)
3ª series
Adjusted principal (IPCA)
Accrued interest (6.2991% p.y)
(1)
01.01.2014
01.01.2014
01.15.2017
Discount amortization is calculated on the straight-line basis over the period from December 2007 to January 2012.
12. Taxes on Income
12.1) Current
BNDESPAR calculates income and social contribution taxes on annual taxable income
and is subject to monthly payments on an estimated basis, whenever the tax
suspension/reduction is not applicable, as provided for in Articles 27 to 35 of Law
nº 8981/95 and other applicable legislation.
As of December 31, 2011, BNDESPAR recorded provisions for social contribution (at
a 9% rate) and income tax (at a 15% rate, plus a 10% surtax). Such provisions were
calculated on income before deduction of income tax and social contribution expenses.
46
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Income tax and social contribution were calculated as follows:
R$ thousand
Accumulated
12/31/2011
Income
tax
Income before taxes
Profit sharing
Tax basis
Total income tax and social contribution expenses (credit) at the
rates of 25% and 9%
Effect of additions (deductions) on tax calculation:
• Allowance for losses (BACEN Resolution nº 2682/99)
• Actuarial liabilities - FAMS
• Dividends from investments
• Receivables written off as losses
• Equity in investees
• Exchange of securities
• Goodwill amortization, net of realization
• Allowance for depreciation of securities
• Labor and Civil provisions
• Planned employee termination program
• Grants – tax incentives
• JSCP – Investment (-)
• Deferral of taxation on sale of permanent assets
• Negative goodwill amortization
• Effect of adjustment to CPCs (RTT)
• Other additions (deductions), net
Income tax and social contribution for the period
Adjustment of provision for income tax and social contribution –
previous years
Income tax and social contribution accumulated
Social
contribution
12/31/2010
Income
tax
Social
contribution
5,559,338
(32,277)
5,527,061
5,559,338
(32,277)
5,527,061
5,204,651
(46,199)
5,158,452
5,204,651
(46,199)
5,158,452
1,381,765
497,435
1,289,613
464,261
54,617
4,841
(292,788)
1,266
(303,309)
19,662
1,743
(105,404)
456
(109,191)
(43,561)
2,677
(158,801)
3,941
(109,837)
(15,682)
964
(57,168)
1,419
(39,541)
(27,386)
(26,597)
(93,305)
5,345
(1,652)
(8,753)
24,547
(40,586)
3,697
(9,859)
(181)
(33,590)
1,924
(594)
(3,093)
8,837
(14,611)
1,331
(11,001)
4,039
20,414
(972)
(2,906)
(9,433)
12,385
(52,164)
29,374
(3,960)
2,000
7,349
(350)
(1,046)
(3,396)
4,459
(107,513)
(6,184)
568,005
9,451
(38,705)
1,848
218,008
(15,377)
(11,212)
(8,414)
954,142
4,288
(4,036)
2,483
368,330
1,251
577,456
202,631
958,430
369,581
Effective rate is as follows:
12/31/2011
Income before income tax and social contribution
Current income tax and social contribution
Deferred income tax and social contribution
Total
Effective rate
R$ thousand
12/31/2010
5,527,061
780,087
439,079
1,219,166
5,158,452
1,328,011
161,406
1,489,417
22,06%
28,87%
Breakdown of taxes payable is as follows:
12/31/2011
Taxes on income:
Provision:
Income tax
Social contribution
Prepayments:
Income tax
Social contribution
Taxes payable
47
R$ thousand
12/31/2010
568,005
218,008
786,013
954,142
368,330
1,322,472
(473,602)
(184,120)
(657,722)
(698,543)
(274,634)
(973,177)
128,291
349,295
10,574
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Recoverable and prepaid taxes are as follows:
R$ thousand
12/31/2010
12/31/2011
Withholding income tax (IRRF) on fixed income
Withholding income tax on variable income
IRRF - interest on capital
Prepayments – audiovisual
Other
Total
Current
Noncurrent
Total
111,590
1,650
260,251
640
1,273
375,404
120,935
112
132,968
6,072
1,272
261,359
375,404
375,404
261,359
261,359
12/31/2011
R$ thousand
12/31/2010
12.2) Tax credits
. Breakdown of deferred tax assets:
Goodwill amortization
Credits written off as losses
Provision for medical expenses – FAMS
Allowance for depreciation of securities
Labor and civil provisions
Provision for employee profit sharing
Planned employee termination program
Derivatives - options
Adjustment to fair value – Debentures
Sub-total
13,921
30,480
9,198
40,823
190,688
10,974
4,471
32,755
293,096
626,406
58,044
13,313
7,631
201,823
183,490
15,708
6,718
164,413
651,140
88,988
88,988
-
715,394
651,140
Deferred taxes on mark-to-market of
available-for-sale securities:
Income tax and social contribution
Sub-total
Total deferred taxes
12/31/2011
. Breakdown of deferred tax liabilities:
Discount amortization
Capital gain on long-term sale of permanent asset
Mark-to-market - financial instruments
Bargain purchase gain
Write-off of discount - CPC
Derivatives - option
Sub-total
R$ thousand
12/31/2010
(7,621)
(126,139)
(398,745)
(349,928)
(432,317)
(194,736)
(1,509,486)
(8,054)
(52,164)
(155,427)
(349,928)
(437,344)
(92,224)
(1,095,141)
(8,752,145)
(8,752,145)
(15,152,814)
(15,152,814)
(10,261,631)
(16,247,955)
Deferred taxes payable on mark-to-market of
available-for-sale securities:
Income tax and social contribution
Sub-total
Total deferred taxes payable
48
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Under CVM Resolution no 599/09 deferred tax assets and liabilities were recognized
on temporary additions and deductions that in the future will be deductible and taxable
in the income tax and social contribution tax basis. Through the balance sheet date, the
Company has budgets and expects to generate taxable income for the foreseeable
future. The Company does not expect to offset deferred tax credits after five years,
except for those recognized prior to CMN Resolution no 3059/2002, in line with the
policy adopted by the parent company (BNDES). Deferred tax liabilities are
recognized regardless of their expected realization. As at December 31, 2011, the
contra entry to the provision for deferred income tax and social contribution was:
12/31/2011
(315,837)
(123,242)
(439,079)
Income tax
Social contribution
Total
R$ thousand
12/31/2010
(132,890)
(28,516)
(161,406)
Basically, deferred tax assets on temporary differences arise from:
a) Credits written off as loss: refer to allowance for losses recorded on credit sale of
securities and receivables which are past due for more than 360 days or that had
their maturity accelerated due to noncompliance with contract clauses. Such
receivables may be under amicable collection by the receivable recovery
department, or otherwise subject to court collection.
b) Labor and Civil provisions: refer to labor (Note 13.a) and civil (Note 13.b)
contingencies.
c) Allowance for losses on investments: equity interests accounted for at cost or
under the equity method.
d) Goodwill amortization: goodwill arising from subscription of shares in cash,
conversion of debentures or exchange of shares or receivables.
e) Planned retirement employee program: estimated costs of the plan which provides
incentives to employees who qualify for retirement for length of service (Note 20).
f) Derivatives - options: refer to the fair value of options pegged to shares in the
investment portfolio.
g) Provision for medical care expenses - FAMS: refers to provision for medical care
expenses accounted for as prescribed by CVM Resolution nº 600/09.
h) Adjustment to fair value: refers to the mark-to-market of debentures.
49
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Deferred taxes payable arising from temporary differences are basically originated by:
a) Mark-to-market - financial instruments: refers to the mark-to-market of
debentures, securities classified as available for sale and other investments in
associates when the significant influence has been lost;
b) Bargain purchase gain: income recognized on the acquisition of associates because
the fair values proportional to net assets of such associates are higher than the
consideration paid in exchange for these associate’s equity;
c) Write-off of discount - CPC: discount recognized before 2009 written off as a
result of the first-time adoption of CPCs.
Tax credits and taxes payable on temporary additions and deductions are realized upon
payment, utilization, reversal, sale or write off of the related differences. The amounts
recognized and written off are as follows:
12/31/2010
Recognition Realization
R$ thousand
12/31/2011
Tax credits:
. Allowance for losses on securities
. Receivables written off as losses
. Goodwill amortization
. Provision for medical expenses – FAMS
. Labor and Civil provisions
. Provision for employee profit sharing
201,823
13,313
58,044
7,631
183,490
17,384
39,094
1,567
9,138
(178,384)
(21,927)
(44,123)
(1,940)
15,708
6,718
164,413
651,140
10,974
293,096
371,253
(15,708)
(2,247)
(131,658)
(395,987)
10,974
4,471
32,755
293,096
626,406
-
88,988
88,988
-
88,988
88,988
651,140
460,241
(395,987)
715,394
(8,054)
(52,164)
(155,427)
(349,928)
(437,344)
(92,224)
(1,095,141)
(73,975)
(735,567)
(102,512)
(912,054)
433
492,249
5,027
497,709
(7,621)
(126,139)
(398,745)
(349,928)
(432,317)
(194,736)
(1,509,486)
Sub-total
(15,152,814)
(15,152,814)
-
6,400,669
6,400,669
(8,752,145)
(8,752,145)
Total
(16,247,955)
(912,054)
. Planned employee termination program
. Derivatives - option
. Adjustment to fair value – Debentures
Subtotal
40,823
30,480
13,921
9,198
190,688
Deferred taxes payable on mark-to-market of
available-for-sale securities:
Income tax and social contribution
Sub-total
Total
Taxes payable::
Discount amortization
Capital gain on long-term sale of permanent asset
Adjustment of debentures to fair value - Financial instruments
Bargain purchase gain
Write-off of discount - CPC
Derivatives - option
Subtotal
Deferred taxes payable on mark to market of available-for-sale
securities:
Income tax and social contribution
6,898,378 (10,261,631)
The amount of tax credits not recorded as of December 31, 2011 totaled R$122
(R$105 as of December 31, 2010). This amount refers basically to credits written off
as losses and the provision for medical expenses – FAMS.
50
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The expected realization of tax credits and tax payable are as follows:
Tax credits:
Allowance for losses on securities
Receivables written off as losses
Goodwill amortization
Planned employee termination program
Provision for employee profit sharing
Provision for medical expenses – FAMS
Labor and Civil provisions
Derivatives - option
Adjustment to fair value – Debentures
Sub-total
. Deferred taxes on mark-to-market of
available-for-sale securities:
Income tax and social contribution
Sub-total
Total deferred taxes
2012
2013
8,503
27,018
58
4,471
10,974
1,690
1
52,715
8,601
3,075
310
1,778
919
14,683
-
88,988
88,988
52,715
2014
2015
2016
After 2016
R$ thousand
Total
5,968
4,042
387
343
1,843
1,854
1,912
882
228
32,755
- 293,096
41,802 301,508
3,812
1,533
1,964
188,658
195,967
9,897
9,834
19,731
40,823
30,480
13,921
4,471
10,974
9,198
190,688
32,755
293,096
626,406
-
-
-
88,988
88,988
103,671 41,802 301,508
195,967
19,731
715,394
-
Taxes payable:
. Discount amortization
Capital gain on long-term sale of permanent asset
. Adjustment of debentures to fair value – Financial instruments
. Bargain purchase gain
. Write-off of discount - CPC
. Derivatives - option
Sub-total
-
-
-
-
-
(7,621)
(126,139)
(398,745)
(349,928)
(432,317)
(194,736)
(1,509,486)
(7,621)
(126,139)
(398,745)
(349,928)
(432,317)
(194,736)
(1,509,486)
Income tax and social contribution
Sub-total
(45,202)
(45,202)
-
-
-
-
(8,706,943)
(8,706,943)
(8,752,145)
(8,752,145)
Total deferred taxes payable
(45,202)
-
-
-
(10,216,429)
(10,261,631)
Deferred taxes payable on mark to market of available-forsale securities:
-
13. Civil and Labor Provisions
BNDESPAR is a party to labor, social security, civil and tax lawsuits arising from the
normal course of its business.
The provision recognized is considered by Management as sufficient to cover probable
losses.
51
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The provisions, categorized by their nature, are as follows:
12/31/2011
R$ thousand
12/31/2010
Labor lawsuits
Civil lawsuits
Total
6,017
556,220
562,237
10,681
530,176
540,857
Current
Noncurrent
3
562,234
562,237
5,830
535,027
540,857
Total
The expected schedule of disbursements for lawsuits is as follows:
R$ thousand
Labor lawsuits
2012
2013
2014
2015
2016
2017
2018
2019
2020
3
2,702
1,204
669
48
1,326
65
6,017
Civil lawsuits
1,391
554,829
556,220
a) Labor lawsuits
Provisions for labor contingencies reflect the classification of probable losses on 19
lawsuits in progress, basically related to overtime previously contracted (terminated
after the enactment of Law nº 10566/2002) and the Amnesty Law (Collor
Administrative Reform).
Changes in labor provision in the period are as follows:
12/31/2011
10,681
(4,525)
(139)
6,017
Balance at beginning of period
Recognition
Reversal
Payments
Balance at end of period
R$ thousand
12/31/2010
10,040
2,845
(2,204)
10,681
As at December 31, 2011, BNDESPAR is a party to 2 ongoing lawsuits, whose
likelihood of loss is assessed as possible, in the estimated amount of R$18 thousand
(R$640 thousand as at December 31, 2010), which discuss the supplementation of
retirement, administrative reform of Collor’s administration and overtime.
52
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
b) Civil lawsuits
Provision for civil contingencies reflects the risk classification as probable loss on 2
lawsuits, the most important of which are related to privatization transactions carried out
by the Federal Government and implemented by BNDES as the manager of the National
Privatization Program (PND), and also to contractual matters.
One of the main claims refer to a lawsuit filed in 1995, arising from a privatization
auction conducted in 1989, where a lower court decision favorable to BNDESPAR was
reversed; the judgment of the appeals filed are pending.
Changes in civil provision in the period are as follows:
12/31/2011
530,176
26,044
556,220
Balance at beginning of the period
Recognition
Reversal
Payments
Balance at end of period
R$ thousand
12/31/2010
534,705
(4,529)
530,176
As at December 31, 2011, the Company is a party to 10 ongoing lawsuits, whose
likelihood of loss is assessed as possible, in the estimated amount of R$807 (R$572 as
at December 31, 2010), of which 6 lawsuits in the amount of R$197 refer to tax issues
and discuss the refund of shares (arising from debentures issued), collection of IPTU
and contractual issues.
14. Shareholders’ equity
As of December 31, 2011, subscribed and paid-up capital totals R$57,428.8 million and it is
represented by a single registered common share, without par value, held by BNDES.
The Board of Directors of BNDES, through its decisions listed below, approved capital
increases in BNDESPAR as follows:
•
•
Decision nº 521/2011, as of May 31, 2011, approved the capital increase in the amount
of R$5,125. The capital balance rose from R$46,304 as of December 31, 2010 to
R$51,429, through the capitalization of profits recorded in 2009 and 2008, in the
amounts of R$2,754 and R$2,341, respectively, and the remaining prior-years retained
earnings in the amount of R$30.
Decision nº 1278/2011, as of December 13, 2011, approved the capital increase in the
amount of R$6,000. The capital balance rose from R$51,429 to R$57,429, through the
partial conversion of receivables held by BNDES against BNDESPAR.
53
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Allocation of profit
The allocation of profits for 2011 and 2010 is as follows:
R$ thousand
As of December 31
2011
2010
Profit (loss) for the year
Prior-years adjustment (1)
Amounts allocated
4,307,895
4,307,895
3,669,035
2,143,370
5,812,405
215,395
34,372
127,953
982,544
2,947,631
290,620
37,731
1,551,864
983,048
2,949,142
-
Allocations
Legal reserve - 5% (2)
Tax incentive reserve
Reserve for adjustments to accounting practices
Mandatory minimum dividend - 25% (3)
Contribution to capital
(1) Adjustment arising from application of CPCs.
(2) Limited to 20% of capital or, at the discretion of BNDES, when this reserve balance plus capital reserves reaches 30% of capital.
(3) 25% of adjusted net income after the recognition of the legal reserve, tax incentives reserve and accounting practice adjustment
reserve.
Payment of dividends
In 2011 dividends were paid in the amount of R$4,041, embracing 2010 mandatory
dividends in the amount of R$1,009 and 2010 supplementary dividends in the amount of
R$3,032, adjusted based on SELIC rate.
2011
Amount declared Amount paid (*)
Event
- R$ thousand
R$ thousand Payment date
Payment method
Mandatory dividends – Fiscal year 2010
983,048
1,008,706
04/26/2011 In cash
Supplementary dividends – Fiscal year 2010
2,949,142
3,032,484
05/04/2011 In cash
Total payments
3,932,190
4,041,190
(*) Includes adjustment using the SELIC rate from the end of profits’ fiscal year until the date of payment.
2010
Amount declared Amount paid (*)
Event
- R$ thousand
R$ thousand Payment date
Payment method
Mandatory dividends – Fiscal year 2009
917,865
934,944
03/24/2010 In cash
(*) Includes adjustment using the SELIC rate from the end of profits’ fiscal year until the date of payment.
Tax incentive reserve
After the enactment of Law nº 11638/07, tax incentives started to pass through profit or loss
and to be allocated as earnings reserve.
54
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Reserve for adjustment to accounting practices
Corresponds to a bylaw reserve recognized to include earnings arising from accounting
practices different from those adopted by the sole shareholder (BNDES). Under the bylaw,
the amount allocated to this reserve is deducted from the mandatory minimum dividend
calculation basis. The maximum amount of this reserve is within the overall limit of
earnings reserves in relation to capital, as prescribed by article 199 of Law nº 6404/76.
Valuation adjustments to equity
The contra entries to increases or decreases in the amounts attributable to asset or liability
components, net of taxes, as a result of their measurement at fair value, are accounted for
under this line item. These adjustments are broken down as follows:
12/31/2011
R$
thousand
12/31/2010
Adjustment - accumulated translation - reflex from associate
Adjustment - other comprehensive income - reflex from associate
Measurement at fair value of securities classified as available for sale (1)
Own securities
Assets from associates and subsidiaries (1)
(277,684)
545,817
16,827,715
16,816,716
10,999
(81,281)
(129,935)
29,414,578
29,414,287
291
Total
17,095,848
29,203,362
(1)
CPC 38, incorporated to Central Bank of Brazil’s standards under Letters nº 3068/2001 and nº 3082/2002, requires the mark-tomarket of the portfolio of equity investments classified as available for sale.
15. Related Parties
BNDESPAR operates and conducts transactions with entities qualifying as related parties
under Technical Pronouncement nº 5, of the Accounting Pronouncements Committee (CPC),
approved by CVM Resolution No 560/08.
15.1) Transactions with the parent company
Transactions conducted with the parent company are summarized below, and the
related terms and conditions are described in Note 10.1:
12/31/2011
Assets
Credit sale of securities
Local currency
86,932
Liabilities
Onlendings
Local currency
Foreign currency
Dividends payable
55
R$ thousand
12/31/2010
91,770
8,749,481
8,710,955
38,526
11,691,430
11,642,000
49,430
982,544
983,048
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
12/31/2011
Income:
Credit sale of securities
Local currency
Expenses:
Onlendings
Local currency
Foreign currency
R$ thousand
12/31/2010
6,361
38,931
(1,102,895)
(9,904)
(1,112,799)
(990,696)
(1,846)
(992,542)
15.2) Transactions with the National Treasury – the BNDES’ sole shareholder
The terms and conditions for these transactions, detailed in Note 10, are summarized
below:
R$ thousand
12/31/2010
12/31/2011
Liabilities
Onlendings
2,884,850
R$ thousand
12/31/2010
12/31/2011
Expenses:
Onlendings
2,584,529
(300,320)
(230,010)
15.3) Transactions with other governmental entities:
In addition to the transactions with its sole shareholder, BNDESPAR conducts, in the
course of its operations, transactions with other governmental entities, therefore under
common control, such as Banco do Brasil, Eletrobrás and Petrobras.
The balances of the significant transactions conducted with these entities are
summarized below:
12/31/2011
Assets
Funds and debentures
438,363
56
R$ thousand
12/31/2010
1,345,022
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
15.4) Transactions with Welfare and Pension Plan Foundation of the BNDES – FAPES
Transactions with Pension Plan and with Health Care and Welfare Fund (FAMS),
administered by FAPES, summarized below, are detailed in Note 18:
12/31/2011
R$ thousand
12/31/2010
124,538
137,256
119,356
117,891
Liabilities
Payables – FAPES – Pension Fund
Actuarial liability - FAMS – Health Care Plan
12/31/2011
Expenses
Pension Plan
Health Care Plan
(19,006)
(19,365)
R$ thousand
12/31/2010
(21,260)
(10,708)
15.5) Transactions with associates
BNDESPAR holds investments in associates, as detailed in note 9.2. In addition to the
capital contributions to the investees and the receiving of dividends and interest on
capital, BNDES and its subsidiaries have other credit granting transactions with these
entities.
These transactions with the investees are conducted under the same terms and
conditions as those conducted with unrelated parties and do not generate different
effects on the BNDESPAR’s income and financial position as compared to
transactions with unrelated parties.
Balances of significant transactions with these entities are summarized below:
12/31/2011
Assets
Receivables
Provision
R$ thousand
12/31/2010
2,631
(2,631)
-
1,488
540
Dividends receivable from associates
15.6) Employees’ and management compensation
BNDESPAR does not grant loans to key management personnel, i.e., directors and
members of the Advisory Board and Fiscal Council.
BNDESPAR does not grant either share-based payments or any other long-term
benefits to its key management personnel. Post-employment benefits are granted only
to employees.
57
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Costs on compensation and other benefits granted to the key management personnel of
the BNDESPAR are as follows:
R$ thousand
12/31/2010
12/31/2011
Short-term benefits:
Payroll and related taxes
542,44
500,73
Compensation paid to management and employees is as follows:
Highest salary(*)
Lowest salary (*)
Average salary(*)
12/31/2011
Management
Employees
5,39
44,92
4,95
1,81
5,09
21,97
R$ thousand
12/31/2010
Management
Employees
4,95
41,21
4,60
1,69
4,72
20,57
(*)Contractual compensation
16. Income (expenses) on allowance for losses
Breakdown of income from reversal of allowance for losses:
R$ thousand
12/31/2010
12/31/2011
Reversal (recognition), net:
Debentures
Credit sale of securities
Receivables
Recovery of receivables written off from assets(*)
Net income (expense) recognized
(12,452)
(87,558)
19,396
483,480
402,866
(266)
11,525
(25,281)
49,009
34,987
(*) Refers basically to the recovery of receivables from two entities totaling R$430, accounting for 90% of the amount recovered.
17. Pension Obligations
The obligations recognized in balance sheets related to the supplementary pension and
medical care plans are as follows:
12/31/2011
Payables - FAPES
Actuarial liabilities - FAMS
Total
Current
Payables - FAPES
Actuarial liabilities - FAMS
Noncurrent
Payables - FAPES
Actuarial liabilities - FAMS
58
R$ thousand
12/31/2010
124,538
137,256
261,794
119,356
117,891
237,247
6,172
4,969
11,141
5,326
4,186
9,512
118,366
132,287
250,653
114,030
113,705
227,735
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
17.1) Pension plan
Welfare and Pension Plan Foundation of the BNDES (FAPES) is a private pension
plan entity. Its main purpose is to provide benefits that supplement the social security
benefits granted by the National Institute of Social Security (INSS) to the employees
of its sponsors: BNDES, FINAME, BNDESPAR and FAPES itself.
FAPES has a defined benefit plan and uses the capitalization financial system to
measure its provisions.
The sponsors guarantee the transfer to FAPES, when necessary, of the funds intended
to cover possible deficits identified by an actuarial valuation, as set forth by the plan’s
bylaw and current legislation.
The actuarial commitment was valued by an independent actuary using the Projected
Unit Credit method (PUC). The adjustments of the amounts for specific dates were
based on interest equivalent to the interest paid by National Treasury Notes - series B
(NTN-B).
The table below shows the results of the actuarial valuation of the supplementary
pension plan:
Present value of actuarial obligation
Fair value of plan assets
Present value of obligations not covered by assets/(excess coverage)
Unrecognized actuarial gains
Actuarial liability (asset)
Assets limit
Additional liability before the Interpretation A (*)
Additional liability - Interpretation A (*)
Net liabilities
(*)
12/31/2011
R$ thousand
12/31/2010
1,288,621
(1,123,397)
165,224
(167,036)
(1,812)
1,812
1,147,360
(1,049,754)
97,606
(98,843)
(1,237)
1,237
-
-
124,538
124,538
119,356
119,356
Interpretation A (The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their
Interaction), equivalent to IFRIC 14 of IASB, is a part of CPC 33 (Decision CVM nº 600/2009).
Additional liability
The additional liability refers to debt acknowledgment contracts entered into with the
sponsors, with a settled amortization period, through monthly payments, totaling
thirteen installments per year, calculated using the Price System and subject to annual
interest equivalent to the 6% actuarial rate plus the administrative costing rate and
inflation adjustment, which occurs at the same time and proportion of the sponsors’
employees’ salary increases or general changes. Therefore, the contracted debt is
recognized as an additional liability when the net liability is determined.
59
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The balance of these debts is as follows:
R$ thousand
12/31/2010
12/31/2011
Contracts of 2002 (a)
Contracts of 2004 (b)
Total
93,431
31,107
124,538
87,484
31,872
119,356
Current
Noncurrent
Total
6,172
118,366
124,538
5,326
114,030
119,356
(a)
This refers to the agreement between the BNDES System and their employees regarding the recognition of
changes in working hours, pursuant to Law nº 10556, as of November 13, 2002, which resulted in a 16.67%
increase in the participants’ contribution salary, directly impacting the benefit plan’s mathematical
provisions. For partial coverage of the increase in such reserves in 2002, contracts establishing the debt
repayment in 390 installments were entered into. The payment began in January 2003.
(b)
This refers to conversion of the mathematical provisions to be recognized (in compliance with the Central
Bank of Brazil’s recommendation), which were being amortized on a monthly basis since November 1998
through extraordinary contributions, into debt acknowledged by the sponsors, due in November 2018. The
first installment was paid in December 2004.
Changes in present value of the defined benefit obligation:
12/31/2011
Present value at beginning of period
Cost of current service
Interest cost
Unrecognized actuarial losses (gains)
Benefits paid
Present value at end of period
1,147,360
10,035
116,965
80,790
(66,529)
1,288,621
R$ thousand
12/31/2010
969,476
8,375
95,860
135,402
(61,753)
1,147,360
Changes in fair value of plan assets:
12/31/2011
Balance at beginning of period
Expected return on plan assets
Unrecognized actuarial gains (losses)
Contributions received from employer
Contributions received from plan’s participants
Benefits paid
Balance at end of period
1,049,754
106,221
12,599
18,635
2,717
(66,529)
1,123,397
R$ thousand
12/31/2010
993,927
99,465
(624)
15,755
2,984
(61,753)
1,049,754
BNDESPAR expects to contribute approximately with R$19 to the supplementary
pension plan in the next twelve months.
60
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The amounts recognized in the income statement are follows:
R$ thousand
12/31/2010
12/31/2011
Cost of current services
Interest expense
Expected return on the plan assets
Total
10,035
116,695
(106,221)
20,509
8,375
95,860
(99,465)
4,770
The expected income of plan assets was determined based on the same assumptions
used for the adjustment of liabilities, using actuarial interest equivalent to the interest
paid by National Treasury Notes - series B (NTN-B). The main categories of plan
assets, as a percentage of total plan assets, are as follows:
Em (%)
12/31/2011
Balanced funds
Shares
Real estate investments
Other
Total
79.7
5.0
8.2
7.1
100.0
12/31/2010
80.2
5.6
5.7
8.5
100.0
MPS/CNPC Resolution nº 8 as of October 31, 2011, which addresses the accounting
procedures of closed-end supplementary pension plans, approved the appendices that
provide for the standard accounting planning, models and instructions for the
preparation of financial statements. The main categories of the plan assets were
presented in accordance with said resolution.
The actual return on the plan assets accumulated through December 31, 2011 was
R$119 (R$99 as at December 31, 2010).
The table below shows the estimated benefits payable for the next three years as at
December 31, 2011:
R$ thousand
12/31/2012
12/31/2013
12/31/2014
69,748
72,887
76,167
17.2) Medical care plan
BNDESPAR, as a wholly-owned subsidiary of BNDES, sponsors FAMS (Health Care
and Welfare Fund), created primarily to provide the plan’s participants and
dependents with benefits that supplement or are similar to those granted by the INSS.
These benefits, which include healthcare, hospital and dental care services under free
or directed-choice systems, have been provided to the employees since 1976, under
the BNDES’ Board of Directors Resolution nº 933/98, also applicable to the BNDES’
subsidiaries.
61
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
FAMS beneficiaries are active and retired employees of the BNDES and its
subsidiaries and their dependents; in the event of death of the principal beneficiary,
the dependent is assured of his/her right to the benefits over a maximum of 24 months.
FAMS receives funds from BNDESPAR to attain its purposes. These funds are
managed by FAPES - Fundação de Assistência e Previdência Social of BNDES,
which is also responsible for the preparation of the annual budget and breakdown of
operational costs necessary to FAMS.
FAMS is not covered by guarantors’ assets. Benefit prepayment is made by
BNDESPAR based on the budgets presented by FAPES, which reports the costs
incurred on a monthly basis through the Statement of Rendering of Accounts.
As of December 31, 2011, the amount of the actuarial obligation to covered
participants and active participants for the average future time of service was recorded
based on the update of the actuarial valuation made by an independent actuary.
The amounts recorded in balance sheet are as follows:
Present value of unfunded obligations
Unrecognized actuarial losses
Net actuarial liability
12/31/2011
R$ thousand
12/31/2010
173,184
(35,928)
137,256
162,079
(44,188)
117,891
The changes in the present value of the defined benefit obligation are as follows:
12/31/2011
162,079
1,927
16,729
(2,191)
(5,360)
173,184
Balance at beginning of period
Cost of current service
Interest cost
Unrecognized net actuarial gains (losses)
Benefits paid
Balance at end of period
R$ thousand
12/31/2010
130,380
1,448
13,006
23,252
(6,007)
162,079
Amounts recognized in the income statement:
12/31/2011
Cost of current service
Interest cost
Unrecognized net actuarial gains (losses)
Total
1,927
16,729
6,069
24,725
R$ thousand
12/31/2010
1,448
13,006
2,260
16,714
BNDESPAR expects to contribute approximately R$6 to the medical care plan in the
next twelve months.
62
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
A one percentage point change in medical care cost rates would have the following
impacts:
R$ thousand
One percentage
point increase
Effect on aggregate cost of current service and interest cost
Effect on defined benefit obligation
3,004
26,151
One percentage
point decrease
(2,459)
(21,542)
17.3) Actuarial and economic assumptions
All actuarial calculations involve future projections for some parameters, such as:
salaries, interest, inflation, variation of INSS benefits, mortality, disability, etc. No
actuarial outcome can be analyzed without the prior knowledge of the assumptions
scenario used in the valuation. The following economic assumptions were used in the
valuations:
Benefits considered
Actuarial valuation method
Qualified mortality table
Disability mortality table
Disability
Actual salary increase expected for active
participants
Nominal discount rate
Inflation rate
Expected return on supplementary pension plan
assets
Real trend rate of medical costs
December 31, 2011
All regular benefits
Projected Unit Credit
AT 2000
AT 49 worsened by 100%
Álvaro Vindas
Technical group (3.1100%
p.y.) and support group
(2.5397% p.y.)
10.288% p.y.
4.5% p.y.
December 31, 2010
All regular benefits
Projected Unit Credit
AT 2000
AT 49 worsened by 100%
Álvaro Vindas
Technical group (2.9546%
p.y.) and support group
(2.4426% p.y.)
10.4909% p.y.
4.5% p.y.
10.288% p.y.
5% p.y.
10.4909% p.y.
5% p.y.
18. Other benefits
The BNDESPAR grant the following benefits to their active employees:
12/31/2011
Transportation ticket
Meal ticket
Education bonus
Total
54
9,629
2,477
12,160
R$ thousand
12/31/2010
79
7,223
2,195
9,497
19. Planned employee termination program
After the decision of the STF (Federal Supreme Court) which established that the voluntary
retirement of employees does not automatically terminate the employment contract, a large
number of employees remained working at BNDESPAR while receiving the retirement
benefit, which impaired the expected renewal of its personnel.
63
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The Planned Retirement Program which is an incentive for the retirement of employees who
are eligible to full or early retirement through December 31, 2012 was approved under the
scope of the Collective Bargaining Agreement, to ensure the renewal of personnel, without
prejudice to the dissemination of the retirees’ experience to new employees.
According to FAPES estimate, 27 BNDESPAR’s employees will be eligible to the Program,
corresponding approximately to 1.0% of the current headcount of the BNDES System.
The estimated disbursement as at December 31, 2011, as a result of the program
implementation, is approximately R$13 and it is recorded in current liabilities due to its
termination by 2012.
20. Financial instruments: embedded derivatives, simple derivatives
In light of the corporate purpose of BNDESPAR, some equity investment transactions
presents a structure that generate embedded derivatives in debenture contracts. These
derivatives do not have a hedging purpose and are not speculative. These derivatives are
options for the conversion into or exchange for shares of underlying debentures. Thus, these
derivatives do not pose any risk of loss to BNDESPAR. CPC´s technical pronouncements
addressing the matter, which were issued in 2009, were adopted in accordance with CVM
Resolution nº 603/2009. Accordingly, CPC 38 (Financial instruments: Recognition and
Measurement), CPC 39 (Financial instruments: Presentation) and CPC 40 (Financial
instruments: Disclosure), which require the measurement and recognition of these
derivatives at fair value, were adopted. These debentures were stated at fair value through
profit or loss (Note 6.3.4).
Debentures convertible into/exchangeable for shares listed in stock exchanges
Debentures convertible into/exchangeable for shares not listed in stock exchanges
Total
12/31/2011
7,755,148
2,312,044
10,067,192
R$ thousand
12/31/2010
10,448,439
1,595,897
12,044,336
BNDESPAR is a party to structured option agreements linked to variable income
investments as follows:
Derivatives
Call option (liability)
Put option (asset)
Redemption of shares (asset)
12/31/2011
R$ thousand
12/31/2010
Black-Scholes / Merton
(96,338)
(483,569)
Black-Scholes / Merton
Black-Scholes / Merton
478,862
93,891
572,753
229,902
41,346
271,248
Type
Pricing methodology
American option
European option
European option
Management did not identify any market risk operation deemed relevant that could result in
material losses to the Company.
64
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
21. Risk management and sensitivity analysis
In compliance with internal and external regulations and the objectives set by the high
management, BNDES Risk Management Area is responsible for:
a) setting and proposing to the Advisory Board the general risk management and internal
control guidelines for the BNDES and its subsidiaries;
b) monitoring the risk exposure levels;
c) analyzing and monitoring the regulatory capital requirements;
d) analyzing the changes in allowances for doubtful accounts and their impacts on the
profit or loss of the BNDES and its subsidiaries;
e) assessing the quality of internal control in place at the BNDES System, the assignment
of responsibilities, the segregation of duties, involved risks, and the compliance of
processes with internal and external guidelines by proposing measures for their
improvement; and
f)
disseminating a group-wide internal control and risk management culture.
BNDES risk management is an ongoing process. The work is performed so as to allow
consistency in terms of risk management policies, processes, criteria and methodologies.
The following comprise the risk management and internal control structure of BNDES:
Advisory Board; Board of Directors; Risk Management Committee; Market, Credit and
Operational Risk Management and Internal Control Subcommittees; and units dedicated
to risk management.
•
Internal Controls
Internal controls are procedures that are present at all entity’s levels, which are
designed to mitigate risks and provide reasonable assurance that the following
objectives will be met:
− Compliance: performance of activities in accordance with internal and external
guidelines that regulate such activities;
− Performance: process efficiency and effectiveness, with no significant costs and
asset hedging;
− Information: disclosure of reliable, precise and timely information to support the
decision-making process.
BNDES promotes the continuous improvement of internal controls, based on the
foundations set out in CMN Resolution nº 2554/98 and the Corporate Internal Control
65
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
Policy. In this context, activities are performed to check the compliance with internal and
external regulations and assess internal controls and risks of work processes.
The reports containing the conclusions on these evaluations are submitted to the Internal
Control and Operational Risk Management Subcommittee, Risk Management Committee
and the high Management. Compliance with the recommendations presented to the units
involved is continuously monitored.
The continuous dissemination of the internal control culture is based on a communication
process to clarify the role of each professional in the Internal Control System and emphasize
the importance of ethics and transparency. In addition to disseminating the Corporate
Internal Control Policy and making available information related to this subject on the
intranet, the Bank holds lectures for new employees as part of the current headcount renewal
process to highlight the importance of internal control.
The highlights in 2011 were as follows:
− compliance monitoring work and assessment of process internal control, as established in
the annual plan of the Internal Control Unit;
− implementation of the continuous monitoring project for internal control evaluation;
− compliance agent project; and
− approval, by the Advisory Board, of the Internal Control Report for the second six-month
period of 2010 and first six-month period of 2011, as set forth in CMN Resolution
2554/98.
Operational Risk
Operational Risk is the possibility of incurring in losses due to failure or inappropriateness
of internal processes, people and systems, or external events. The concept includes legal risk,
associated to unsuitability or weaknesses in contracts entered into by the institution, as well
as penalties due to noncompliance with rules, and compensation paid for damages caused to
third parties as a result of the activities conducted by the Bank. Differently from the market
and credit risks, its management and mitigation involves all functions of the Bank.
The unit responsible for operational risk is in charge of assisting the other units in
identifying and assessing these risks. To this end, the principles set out in the Corporate
Operational Risk Management Policy, as well as those set out in the Business Continuity
Management Corporate Policy are followed. Both policies set out the set of principles,
actions, roles and responsibilities relating to the issues in the financial institution.
As regards the regulatory capital, BNDES currently uses the Basic Indicator Approach to
calculate the Required Regulatory Capital (PRE) related to the operational risk (POPR). This
portion is being periodically calculated and reported to the BACEN as an integral part of the
Statement of Operational Limits (DLO).
66
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
In order to disseminate the operational risk culture in the Bank, a specific module on this
theme was included in the new employee training program. Operational Risk information is
also available on the intranet to our internal audience.
In 2011, with respect to the continuous assessment and mitigation of operational risk, special
attention was directed in improving the risk assessment methodology and operational loss
database. In respect of the development and implementation of a Business Continuity
Management System (SGCN) for BNDES, a bid process was completed to hire a technical
consulting firm specialized on the matter, and the project began in September 2011.
Additionally, the Incident Management Plan (PGI) of BNDES is being reviewed.
Market and liquidity risk
The market risk is the risk of financial losses resulting from changes in the fair values of the
asset and liability positions held by the Bank, including the risks of fluctuation in foreign
exchange rates, the interest rates, equity prices, and the commodity prices.
BNDESPAR is exposed to currency fluctuations arising from foreign currency-denominated
transactions, with respect to which the currency risks are daily monitored through the
determination of currency exposure. This activity is controlled for BNDES Consolidated,
which comprises BNDESPAR’s positions, through the operation in the foreign exchange
derivatives market. The mismatch risk between indices and rates is monthly monitored and
is subject to the limits approved by the Risk Management Committee (CGR). The limits are
established for each of the companies and Consolidated.
BNDES’s Liquidity and Market Risk Management area monitors the figures related to
BNDESPAR’s equity investments in publicly-held companies with shares listed in Bovespa,
privately-held companies and investment funds, performing marked-to-market activities of
the stock portfolio of publicly-held companies. The monitoring of the stock risk progress is
supported by indicators, including the parametric VaR, which is measured by company
and/or sector through the supplementary VaR analysis for the entire portfolio.
Liquidity risk is the risk arising from mismatches between tradable assets and payable
liabilities – mismatches between payments and receipts - that might affect the payment
ability of the Company, taking into consideration the different currencies and settlement
terms of its assets and liabilities.
BNDESPAR, due to its nature directed to capital contribution, has low liquidity risk. The
Company's liquidity risk management is controlled through BNDES Consolidated, by
analyzing on a quantitative basis the financial instruments included in the tradable assets or
payable liabilities, for 30, 60 and 90 days.
The Corporate Market and Liquidity Risk Management Policy of BNDES and its
subsidiaries defines the set of methodologies, procedures, limits, instruments, and
responsibilities applicable to permanent control of the Bank’s internal processes to ensure an
appropriate risk management.
67
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The risk management monitors the portion of capital requirements resulting from the trading
and non-trading portfolios to ensure that the risks inherent to these transactions are
consistent with the desirable risk appetite of the Bank.
The trading portfolio consists of all transactions conducted with financial instruments,
including derivatives, held with the intent of being actively and frequently traded or used for
hedge purposes, and not subject to trading restrictions. Transactions held for trading are
those intended for (i) resale; (ii) obtain benefits from changes in effective or expected prices;
or (iii) arbitration.
BNDESPAR’s trading portfolio is currently comprised of investment funds managed by the
security underwriter. Most of the trading portfolio is comprised of government bonds, whose
yield is pegged to the DI rate, resulting in market risk at relatively low amounts when
compared to the other portions comprising the Company's Required Regulatory Capital.
The non-trading portfolio corresponds basically to BNDESPAR’s investments in floating
income securities, private securities with or without option and funding. This portfolio
includes interest rate, price, and currency risks. Some BNDES’ shares are accounted for
under the equity method.
Market risk measurement procedures
The measurement procedures adopted to measure and control market risks are described
below:
(a) Value at Risk
VaR is a risk measure based on statistics of potential losses on portfolios of investments
due to adverse changes in market variables. VaR determines BNDESPAR’s maximum
losses considering a confidence level of 99%. Therefore, there is a probability of 1%
that the actual losses may be greater than the estimated VaR. This model assumes a tenday period for the maintenance of the positions. Moreover, such model also assumes
that the changes over this period will comply with a standard similar to the changes over
the prior ten-day period. VaR is adopted to assess the risk of financial operations in the
trading portfolio subject to fixed interest rates denominated in Brazilian reais and also
the risk of the portfolio of shares held by publicly-held companies.
(b) Net Interest Income
The Net Interest Income (NII) variation is a risk measurement which determines the
possible losses from the Bank’s net interest rate. Therefore, a GAP is adopted for the
non-trading portfolio in BNDES system’s operational records (loan portfolio,
debentures and portfolio of government bonds). The GAP analysis measures the interest
rate risk exposure specifically applicable to operations with fixed income instruments.
68
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
This methodology determines the estimated losses from net interest revenues based on
the GAP analysis and stresses on the portfolio's risk factors for one-year holding period.
(c) Stress test
The stress tests provide an indication of the potential losses which could result from
extreme market conditions. With respect to the trading portfolio, the stress tests are
carried out by the Fund Manager (BB DTVM), in which BNDES System holds interest,
and are monitored by the Market Risk Department. With respect to the non-trading
portfolio, stress tests are performed monthly to determine the interest rate risk.
Sensitivity analysis of financial instruments pursuant to CVM Normative
Instruction 475/08 and CVM Resolution 604/09
We present below the sensitivity analysis of the financial instruments comprising the
BNDESPAR’s operations, including derivatives, which describes the risks inherited to
these operations and which could result in financial/economic losses against the
Company.
In the preparation of the sensitivity analysis, the Company adopted the following
assumptions, as defined in the abovementioned rules:
i) Identify the market risks that can result in material losses to the Company.
ii) Define a probable scenario, as set forth in CVM Resolution 604/09, for the risk
behavior supported by an independent outside source for a one-year period.
iii) Define two additional scenarios, as set forth in CVM Instruction 475/08, with
stresses of at least 25% and 50% in the risk variable considered (Scenario II and
Scenario III, respectively).
iv) Determine the effects of the scenarios on the fair value of the financial instruments
managed by the Company and the effects on income or loss and shareholders’
equity; and
v) The probable and stress scenarios (I and II) were compared with the current
scenario for each type of financial instrument.
In order to determine the sensitivity analysis of fixed income transactions and exchange
rates, the probable scenario, evaluated internally, considers the expected behavior of
rates for the next 12 months, which may result in gains or losses to the Company.
Scenarios II and III are applicable to stresses of 25% and 50% (directed to losses) on
market data, as at December 31, 2011.
The probable scenario for variable income transactions (shares) was calculated based on
the portfolio beta and internal evaluations to determine the risk-free rate for one-year
period and the market risk premium, based on the Capital Asset Pricing Model (CAPM).
As at December 31, 2011, the share portfolio amount was used to support the current
scenario. The shares evaluated under the equity method were not included in such
analysis.
69
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
We present below the sensitivity analysis for the operations with financial instruments
which affected the Bank’s income statement and shareholders’ equity. The sensitivity
analysis considered the tax effects at the rate of 34% levied on income/loss of fixed or
variable income operations.
Instrument
Selic / DI
TJLP
Fixed rate
IGPM
IPCA
TR
USD
Shares and equivalents
Instrument
Debentures with option
Shareholding interest
with option
Risk
Effect
Selic increase / DI
Income (loss)
TJLP increase
Income (loss)
Decrease in fixed rate from repricing
Income (loss)
IGPM decrease
Income (loss)
IPCA decrease
Income (loss)
TR increase
Income (loss)
BRL/USD exchange decrease
Income (loss)
Stock price decrease
Shareholders’ equity
FLOATING INCOME DERIVATIVES
Risk
Income (loss)
Probable
scenario
-
Income (loss)
-
Effect
Decrease in asset price (shares)
Increase/decrease in asset price
(shares)
Probable
scenario
3,359
20,155
(272)
3
(2,450)
(1,682)
(1,902)
7,019,392
R$ thousand
Scenario II Scenario III
(22,555)
(45,110)
(33,418)
(66,837)
(377)
(628)
(1)
(2)
(7,980)
(13,301)
(369)
(737)
(5,672)
(9,454)
(12,696,876) (25,393,752)
Scenario II
Scenario III
(414,338)
(742,083)
(197,870)
(381,157)
The term “shares and equivalents” used in the table above refers to the portfolio of
investment in non-associates (“shares”) and financial instruments with equity instrument
characteristics (“equivalents”), classified as available for sale in the balance sheet.
With respect to conversable/exchangeable debentures, should the conversion/exchange
option is not exercised, BNDESPAR will remain with the fixed income of the
debentures and will receive the compensation and/or return of the principal from such
instrument.
With respect to the analyzed derivatives, the price risk of underlying asset to such
financial instruments may be considered as the most relevant, whose variation may be
equivalent to the greater portion of the adjustment to the fair value of these floating
income instruments in a specific period. Therefore, two prices were defined based on
the same models used to determine the fair value recorded in the balance sheet,
considering, as input, the effects from stresses on the spot price of the underlying asset
at the ratio of 25% and 50%, as set forth in CVM Instruction nº 475/08 CVM.
For purposes of CVM Resolution nº 604/09 and CVM Instruction nº 475/08, this
sensitivity analysis considered as probable scenario the fair value already recorded since
this value already reflects Management’s expectation for the probable situation and is
based on external sources with respect to the risk variables comprising the pricing
models adopted for calculation of fair value. This scenario was the basis for the stress
scenario of 25% and 50% of the main risk variable considered, which was the spot price
of the instrument.
Potential losses indicated in the years of risk variable impairment considered in the
sensitivity analysis in accordance with CVM Instruction nº 475/08, including those
related to derivatives arising from financial support operations through variable income
70
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
instruments, do not fairly reflect BNDESPAR’s market risks in terms of structuring and
contracting of operations, do not correspond to the Bank's probable financial and
economic burden and do not represent probable effects on BNDES System’s
performance.
With respect to the derivatives included in this analysis, it is important to consider the
economic effect difference in two time frames: (i) the full term of the derivative; and (ii)
in the interim periods during the derivative term mentioned in item (i). In case of a full
term, between the derivative acquisition date and its maturity (item i), there is no risk of
financial loss on the Bank’s profit or loss, since the fair value of this instrument is
initially equivalent to zero, without any corresponding disbursement as premium. In the
case of interim periods (item ii), there is a risk of loss on derivatives’ value due to
potential negative fluctuations in the fair value of these instruments. Such fluctuations in
these periods impact the Bank’s equity.
With respect to the put options held and call options assigned by BNDESPAR, the
effects from financial exposures do not represent potential losses against the Company,
since, on an economic point of view, the impairment of such options is compensated by
the appreciation of the market value of the respective underlying shares included in
BNDESPAR’s portfolio, representing a type of “natural hedge”.
Credit risk
The credit risk is the risk associated to the possibility of incurring losses due to borrower or
counterparty default of agreed financial obligations, the depreciation of a credit agreement
due to the downgrading of the borrowers’ risk ratings, the decrease in gains or returns, the
advantages granted in renegotiations, and the costs of recovery.
The main purpose of BNDES’s credit risk management is to properly measure the risk of
financial losses on the Bank’s portfolio. Currently, the standard methodology is adopted to
calculate the Regulatory Capital in accordance with the rules issued by the National
Monetary Council. Similarly to the method applicable to the BNDES’s portfolio of assets,
BNDESPAR’s assets, including derivatives, recognize regulatory capital, in accordance with
the rules established by BACEN Circular BACEN nº 3360/07.
The unit responsible for the credit risk management of the BNDES System already performs
estimates for the different risk components of the credit portfolio for future implementation
of the advanced model in accordance with Basel guidelines. Therefore, the risk of the
portfolio comprised of direct borrowings and onlending is determined based on estimates for
the following components: (i) the probable lack of payment by the borrower or counterparty
(PD); (ii) the exposure with the borrower or counterparty on the delinquent date (EAD); and
(iii) losses from the lack of payment (LGD).
However, in order to determine the estimates in accordance with the Basel guidelines, the
measurements must reflect the expected losses (estimated loss model) while the estimates in
accordance with CPC 38 must consider the losses incurred. In view of this, the unit
71
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
responsible for the credit risk management currently considers the database and separated
analysis for Basel and CPC purposes. Particularly with respect to the estimates set forth by
the new accounting standards, several segregations and specific treatments are adopted,
including the calculation and analysis of the risk parameters verified separately for the
BNDESPAR’s portfolio.
22. Guarantees
The Company offered in guarantee 7,744,038 registered preferred shares issued by Petróleo
Brasileiro S/A - PETROBRAS (subsequently reversed into 61,952,304 preferred shares) and
28,083.251,230 registered common shares issued by Centrais Elétricas Brasileiras S/A –
ELETROBRAS (subsequently grouped into 56,166,502 common shares), as a contra entry to
the National Treasury for sureties and loans, in the amount of US$ 600 million, raised
abroad by its sole shareholder - BNDES. Out of these shares, 61,952,304 preferred shares
issued by Petrobras and 1,510,070 common shares issued by Eletrobrás are still under
custody.
23. Segment reporting
The Business Segment Report is presented in conformity with the internal report provided to
the “main manager of operating decisions”, responsible for identification and allocation of
proceeds, in addition to the performance evaluation of the operating segments. The
definition of “main manager of operating decisions, in accordance with CPC Accounting
Pronouncement 22, includes the management activities performed by the executive officers,
comprising the Company's management.
BNDESPAR analysis its business mainly considering the financial support through fixed
income instruments (fixed income segment) and variable income instruments (variable
income segment). The financial support through fixed income instruments comprises the
acquisitions of debentures, also those conversable or exchangeable, provided that not quoted
in active market, and the sales in installments of securities. The financial support through
variable income instruments comprises the acquisitions of equity interest in associates (in
which the Company exercises significant influence) or other companies stated at fair value.
This type of support is mainly funded by its own capital, and possible insufficient funds are
supplemented by the funds provided by its sole shareholder, through loan agreements
The accounting policies adopted in the evaluation of information per operating segment are
in accordance with the accounting policies adopted in the presentation of the financial
statements. BNDESPAR evaluates the performance of these segments based on net
operating profit. Income tax is monitored on a centralized basis and, therefore, was not
allocated to any segment. Operating revenues are fully generated from foreign customers
and, therefore, there are no operations between the operating segments.
72
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The information per business segment was analyzed and is presented as follows:
R$ thousand
December 31, 2011
Fixed
income
Variable
income
Other
segments
Unallocated
Total
OPERATING INCOME
Interest income
Gain (loss) on investment funds
Income (loss) from sale of variable income securities
Dividends and interest on capital
Derivative transactions
Equity in subsidiaries
Other Revenues
OPERATING EXPENSES
Interest income
Income (loss) from sale of variable income securities
Dividends and interest on capital
Derivative transactions
OTHER OPERATING INCOME (EXPENSES)
Net inflation adjustment of assets and liabilities
Reversal (creation) of provision for contingencies
Personnel expenses
Depreciation and amortization
Other operating income (expenses)
INCOME BEFORE TAXES ON INCOME AND PROFIT
SHARING
Taxes on income
Profit sharing
NET INCOME
1,372,043
1,339,834
32,209
(1,692,623)
(2,075,767)
402,866
(19,722)
183
183
-
7,185,007
(31,885)
1,705,143
3,611,501
(23,485)
1,923,733
(762,116)
(710,498)
(50,143)
(1,475)
193,500
193,500
-
67,107
67,107
-
(803,763)
(127,139)
(21,519)
(277,852)
(8,190)
(369,063)
8,624,157
1,406,941
(31,885)
1,705,143
3,611,501
(23,485)
1,923,733
32,209
(2,454,739)
(2,075,767)
(710,498)
352,723
(21,197)
(610,080)
66,544
(21,519)
(277,852)
(8,190)
(369,063)
(320,397)
6,616,391
67,107
(803,763)
5,559,338
(320,397)
6,616,391
67,107
(1,219,166)
(32,277)
(2,055,206)
(1,219,166)
(32,277)
4,307,895
ASSETS AS OF DECEMBER 31, 2011
Investments in associates (MEP)
14,984,767
-
93,752,485
19,332,192
217,630
-
1,703,401 110,658,283
- 19,332,192
R$ thousand
December 31, 2010
Fixed
income
OPERATING REVENUES
Interest income
Income (loss) from sale of variable income securities
Dividends and interest on capital
Gains (losses) on derivatives
Equity in subsidiaries
Adjustments to market value of securities
Gain on disposal of fixed income securities
Other Revenues
OPERATING EXPENSES
Interest expenses
Equity in subsidiaries
Impairment losses
Other expenses
OTHER OPERATING INCOME (EXPENSES)
Net inflation adjustments to assets and liabilities
Reversal (creation) of provision for contingencies
Personnel expenses
Depreciation and amortization
Other operating income (expenses)
INCOME BEFORE TAXES ON INCOME AND PROFIT
SHARING
Taxes on income
Profit sharing
NET INCOME
Unallocated
Total
6,775,598
2,892,819
2,228,659
351,346
1,240,776
61,998
(1,966,313)
(990,696)
(801,427)
(144,395)
(29,795)
159,625
159,625
-
125,403
125,403
-
(539,935)
(13,299)
1,685
(281,471)
(6,358)
(240,492)
8,239,148
917,968
2,892,819
2,228,659
351,346
1,240,776
61,998
4,280
541,302
(2,654,275)
(1,692,957)
(801,427)
(109,408)
(50,483)
(380,222)
146,326
1,685
(281,471)
(6,358)
(240,404)
650,273
4,968,910
125,403
(539,935)
5,204,651
4,968,910
(1,489,417)
(46,199)
125,403 (2,075,551)
(1,489,417)
(46,199)
3,669,035
3,534,105
-
73
Other
segments
1,338,147
792,565
4,280
541,302
(687,962)
(702,261)
34,987
(20,688)
88
88
650,273
ASSETS
Investments in associates (MEP)
Variable
income
119,677,009 1,126,479
13,641,374
-
1,485,825
-
125,823,422
13,641,374
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
The presentation of information per segments above already includes the reconciliation of
the amounts of items (revenues, expenses, income, loss, among others) of the operating
segments disclosed with the respective total amounts disclosed in the financial statements,
recorded under “unallocated ".
24. Non-cash transactions
In 2011 and 2010, BNDESPAR carried out financing activities not involving cash, as
detailed below, therefore, these transactions are not reflected in the statement of cash flows:
2011
The Board of Directors approved a capital increase through the partial conversion of credits
held by BNDES in the amount of R$6,000.
2010
The Board of Directors approved a capital increase in the amount of R$15,600 through the
conversion into capital of receivables held by BNDES.
Financed acquisition of securities by means of a loan from BNDES in the amount of
R$22,409 in 2010.
25. Event after the Reporting Period
On January 16, 2012, the fourth interest coupon in the gross amount of R$ 78.090783 per
debenture and the amortization in the gross amount of R$1,306.850920 per debenture
relating to the first public offering of BNDESPAR were paid, according to the Notice to
Debentureholders disclosed on January 12, 2012. The amounts as at December 31, 2011,
described in Note 11, totaled R$826.
74
BNDES PARTICIPAÇÕES S.A. - BNDESPAR
NOTES TO THE FINANCIAL STATEMENTS
For the years ended December 31, 2011 and 2010
(Amounts in millions of Brazilian reais - R$, except otherwise indicated)
ADVISORY BOARD:
FERNANDO DAMATA PIMENTEL
LUCIANO GALVÃO COUTINHO
ALESSANDRO GOLOMBIESWSKI TEXEIRA
JOÃO PAULO DOS REIS VELLOSO
ROBERTO TEIXEIRA DA COSTA
FISCAL COUNCIL:
CLEBER UBIRATAN DE OLIVEIRA
RICARDO SCHAEFER
CLÁUDIO DE ALMEIDA NEVES
ANDRÉ PROITE – Alternate
FÁBIO ESTORTI DE CASTRO – Alternate
JORGE KALACHE FILHO – Alternate
BOARD OF DIRECTORS
LUCIANO GALVÃO COUTINHO – President
JOÃO CARLOS FERRAZ – Vice-President Director
ELVIO LIMA GASPAR – Director
JULIO CESAR MACIEL RAMUNDO – Director
LUIZ EDUARDO MELIN DE CARVALHO E SILVA – Director
LUIZ FERNANDO LINCK DORNELES – Director
MAURÍCIO BORGES LEMOS – Director
ROBERTO ZURLI MACHADO – Director
CHIEF FINANCIAL OFFICER
SELMO ARONOVICH
HEAD OF ACCOUNTING DEPARTMENT:
CARLOS FREDERICO RANGEL DE CARVALHO SILVA - CRC-RJ 087956/O-8
75