By José Junior and Sócrates Felix

As the period for assessing and approving the accounts of company officers draws to a close, there are still doubts about several aspects related to this topic. Is it mandatory? Are there any penalties? What needs to be registered? What are the consequences for those who do not do it?

It is essential to start by saying that the approval of accounts is a legal obligation laid down in articles 1.078 of Law 10.406/2002 (Civil Code) and 132 of Law 6.404/1976 (Corporations Law), applicable to all companies, regardless of size or type. However, no fine applies to companies that fail to comply with the formality except for the penalties arising from possible Brazilian Securities and Exchange Commission’s (CVM) inspection actions (when applicable).

This scenario of lack of immediate punishment means that many business owners fail to pay due attention to the issue. But it must be said that, in addition to corporate transparency, which requires, among other things, correct bookkeeping, there are many situations in which the approval of accounts and subsequent filing with the Commercial Registry will be significant measures for the company.

Who is required to file with the Commercial Registry?

Limited liability companies of any size and cooperatives are exempt from presenting their financial statements as an exhibit to the minutes of the meeting approving the directors’ accounts. Micro-enterprises and small businesses are also exempt from filing their financial statements and holding a meeting of shareholders for this purpose.

On the other hand, corporations are required to file their financial statements with the Commercial Registry, observing some important points set out in article 176 of Law 6.404/76:

  • The financial statements may be published in a summarized form in a mass-circulation newspaper. However, they must indicate, in comparison with data from the previous fiscal year, (i) the information or global values relating to each group; (ii) the respective classification of accounts or records; (iii) a statement of the relevant information included in the notes and the opinions of the independent auditors and the supervisory board, if any.
  • Closely held companies with equity on the balance sheet date of less than two million reais (BRL 2,000,000.00) will not be obliged to prepare and publish a cash flow statement.
  • Closely held companies whose annual gross revenue does not exceed seventy-eight million reais (BRL 78,000,000.00) may choose to make all the publications required by Law 6.404/1976 , in full, through the Balance Sheet Center of the Public Digital Bookkeeping System — SPED.

It should be emphasized that the financial statements must be signed by an accountant (duly identified, including the registration number with the professional agency) and by the board of directors to be submitted for registration with the Commercial Registry.

In turn, the Minutes of the General Meeting by which the shareholders approve the directors’ accounts must comply with one of the procedures below:

  • If by public notice: mention the mass-circulation newspaper in which it was published. The mention of the dates and sheet numbers of the publications will also exempt them from being submitted to the Commercial Registry, either as an accompaniment to the minutes or for annotation.

  • If electronic: the closely held company with annual gross revenue of up to seventy-eight million reais (BRL 78,000,000.00) must mention the website/system (SPED Balance Sheet Center) on which it was published.

Consequences of irregularities in financial bookkeeping

Failure to comply with the rules relating to financial statements can lead to serious problems for companies, ranging from a lack of transparency to considerable financial losses.

Participation in acquisition, merger, sale, judicial reorganization, bankruptcy, or bidding processes, among others, requires the company to maintain strict document regularization. And finance is a fundamental part of this.

In addition, raising funds in the financial system and obtaining tax benefits also require that financial obligations are up to date and duly formalized with the registration bodies.

Changes to the registration of the balance sheet with the Commercial Registries

Seeking to modernize and simplify the process, the National Department of Business Registration and Integration (DREI) recently issued Normative Instruction No. 1/2024, aimed, among other measures, at improving the registration of companies’ balance sheets with the Commercial Registry. Among the main changes related to accounting books (found in articles 10-B and 10-C), one can list:

  • It is not up to the Commercial Registry to verify the entries or form regarding the composition of bookkeeping;

  • The filing of the balance sheet does not have to include all the financial statements, but the document presented must be filed;
  • The Commercial Registry will only analyze the legal and extrinsic formalities, restricting itself to verifying the registration information, such as: corporate name, National Corporate Taxpayer’s Register (CNPJ) number, etc.;
  • Once the balance sheet has been filed, it is possible to apply for re-ratification, provided that there are only remediable issues, arising from material and/or procedural errors that can be rectified or remedied — provided that they do not harm the essence of the document, do not cause damage to the public interest, harm to third parties or uncertainty as to the information provided by the Commercial Registry.

These remediable issues might be:

  • Registration information entered in the document, such as: error in the corporate name and/or CNPJ number — provided that such corrections do not alter the accounting entries; or

  • Some pages of the balance sheet are missing.

The Commercial Registry will not accept any change that involves altering the accounting entries.

Conclusion

Financial regularization goes far beyond corporate transparency and escaping punishment. Keeping the accounts duly approved, booked, and registered can mean a difference in times of crisis or growth opportunities.

PLBrasil Group offers its customers, through its Digital Platform, a HUB where all corporate documents and history are concentrated and permanently available free of charge. In addition, it has qualified professionals and trained teams to provide all the support you need for any type of registration necessary for the incorporation and operation of your company, including the preparation of the required minutes and documents for the regularization of bookkeeping.

The PLBrasil Group is available to assist you with this and other obligations through the channels below:

+55 (11) 3292-5050

nn.sp@plbrasil.com.br

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