Analysis of the reflections of accrual accounting on accounting profit or loss: a study of open public companies in Brazil

Abstract

The article analyzes the reflections of accrual accounting on accounting profit and loss in open public companies in Brazil. Empirical evidence was gathered from a target population of open public companies listed as the 500 biggest and best Brazilian companies according to the criteria of the magazine Exame in 2004. The sample taken from this group was of an intentional, non-probabilistic type, with seven companies representing the steel and metalworking industries. The study is delineated as a descriptive one, using cluster techniques to categorize the data necessary to draw inferences. The correlation coefficients between the accounting result of the period adjusted by the accruals and the variation of net working capital did not present homogeneity in the industry observed, but denoted statistical significance. They show that the accruals cause alterations in the period’s bottom line and at the same time do not influence the financial flow of the companies’ operational activities. Key words: accruals, accounting profit and loss, variation of net working capital.