Abstract
The aim of this article identifies, evaluates and describes relevant facts and acts' occurrences disclosed by Brazilian companies issuing ADRs - American Depositary Receipts. The analysis was made based on 1,125 information extracted from the Comissao de Valores Imobiliarios – CVM’s website, the regulatory commission organization empowered to regulate, standardize and supervise the activities of trade agents of public securities in Brazil. The research used information that was carried out from January 2006 to April 2012. It was evidenced that companies whose trade their depositary receipts in markets with high standards of corporate governance practices do not disclose a larger amount of information than the lower one governance practices. This research expands the knowledge about the content, frequency and timing of disclosure of relevant information by Brazilian organizations in international equity markets.
Highlights
One of the great dilemmas in the literature dealing with the accounting data management relates to how and when to disclose them. Ansoff and McDonnell (1993) show that organizations are faced with complex situations when the decision of disclosing information or not is in play
Not much has been researched on the recurrence and the type of information that these organizations disclose to stakeholders in their activities
From the perspective of governance, this study aims to analyze the guidelines of the mandatory disclosure of information related to material facts and acts of Brazilian companies that trade securities on US stock exchanges
Summary
One of the great dilemmas in the literature dealing with the accounting data management relates to how and when to disclose them. Ansoff and McDonnell (1993) show that organizations are faced with complex situations when the decision of disclosing information or not is in play. The concept of relevant act or fact refers to any decision of the controlling shareholder; it involves the resolutions of the general meeting, the board of directors of the public company, or any other political-administrative, technical, economic and financial information related to the organization's business (CVM, 2002). If disclosure of the relevant information put the organization at risk, or if the relevant act or fact is not mature enough to be disclosed, administrators can maintain confidentiality regarding such information In these cases, companies must monitor the trading of securities issued by it, so that they can identify any atypical fluctuations in price, volume or amount of their business titles. Foreign companies that have open capital in the United States should provide financial and other relevant information to organizational structure, risk factors affecting the operations of the organization and relating to shareholders and corporate governance. In the specific case of this article, it is intended to check the frequency and content of the relevant acts and facts reported by Brazilian companies that operate in this market
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