Asset revaluations, future firm performance and firm-level corporate governance arrangements: New evidence from Brazil

Using a sample of Brazilian listed firms for the period 1998–2004 we find evidence that revaluations of fixed assets are negatively related to future firm performance, prices and returns. We also find that the decision to revalue is negatively associated with scores on a Brazilian Corporate Governance Index (BCGI) and positively associated with indebtedness and illiquidity. Our results suggest that revaluations of fixed assets in Brazil are not designed to convey information to external users of financial statements but rather to improve equity positions – opportunistic motivations. Our evidence also corroborates the idea that firms that adopt superior voluntary governance arrangements are less likely to engage in actions designed to manipulate their financial statements. These results lend support to the recent amendment to the Company law which eliminated the revaluation option for Brazilian firms despite the current process of IFRS convergence.

利用1998 - 2004年期间巴西上市公司的样本，我们发现有证据表明固定资产重估与公司未来的业绩、价格和回报率呈负相关。我们还发现，重估决策与巴西公司治理指数（BCGI）得分呈负相关，与负债和流动性不足呈正相关。我们的研究结果表明，巴西的固定资产重估并非旨在向财务报表的外部使用者传递信息，而是为了改善股权状况——出于机会主义动机。我们的证据也证实了这样一种观点，即采用更优自愿治理安排的公司不太可能采取旨在操纵其财务报表的行为。这些结果为最近对公司法的修订提供了支持，尽管目前正在进行国际财务报告准则（IFRS）趋同的进程，但该修订取消了巴西公司的重估选择权。