Investor Presentaiton
(c) Effect of deferred income tax and social contribution on the
result for the semester and on the result
Opening balance for the year
Effects on the results for the year - continuing operations
Effect on other components of comprehensive income
Deferred income tax from subsidiary included in
consolidation (i)
Closing balance for the year
2021
2020
358
(1,631)
(329)
1,254
(686)
(210)
474
(1,128)
358
(i) It refers to the tax included in the consolidation for the business combination with
McInnis, as described in Notes 1.1(o) and 1.1 (v).
(d) Realization of deferred income tax and social contribution on
tax losses
In 2022
In 2023
In 2024
In 2025
In 2026
After 2027
2021 Percentage
18
12
1%
0%
77
3%
167
586
7%
24%
1,577
2,437
65%
100%
24. Provision
Accounting policy
The Company and its subsidiaries are party to tax, civil, labor and other le-
gal claims in progress at different Court levels. Provision against potentially
unfavorable outcomes of litigation in progress is established and updated
based on management evaluation, as supported by external legal counsel,
and requires a high level of judgment regarding the matters involved.
The judicial deposits are monetarily restated and when they have a corres-
ponding provision they are presented net in Provision. Judicial deposits that
do not have a corresponding provision are presented in non-current assets.
(i) Provision for tax, civil, labor, environmental and other legal
claims
The provision for tax, civil, labor, environmental and other legal claims is re-
cognized when: (i) the Company has a present legal or constructive obliga-
tion as a result of past events, (ii) it is probable that an outflow of resources
will be required to settle the obligation, and (iii) the amount can be reliably
estimated. Losses classified as possible are not recognized for accounting
purposes, and are disclosed in the notes. Contingencies with probability
of loss classified as remote are not provisioned or disclosed, except when
the Company and its subsidiaries consider their disclosure justified. The
classification of losses between possible, probable and remote is based on
Management's assessment, based on the opinion of its legal advisors.
Provision is measured at the present value of the expenditure expected to
be required to settle the obligation using a pre-tax rate that reflects current
market assessments of the time value of money and the risks specific to
the obligation. The increase in the provision due to time elapsing is recogni-
zed as interest expense. Provision does not include future operating losses.
169
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