RELANTIONSHIP BEWTWEEN THE ELIGIBILITY OF ANNUAL REPORTS AND CHANGE OF LEVEL OF CORPORATE GOVERNANCE

Abstract

The Stock Exchange of Sao Paulo (BOVESPA) has different Levels and also the New Market of corporate governance in order to provide a trading environment that would stimulate investors interest and valuation of companies. This study aims to identify the degree of readability of Administrative Reports (ARs) of BOVESPA listed companies that changed their level of corporate governance between the years of 2004 to 2007. It was used the Legilibilidade test of Flesch-Kinkaid in the year of change in level of corporate governance and in the years prior to that change. BOVESPA informed a group of 174 companies which made changes in levels during the study period, after it has adopted criteria for selection, as shown in the selection of samples, 26 enterprises remaining, objects of this study. Thus, it was concluded that the change in the level of corporate governance does not represent a higher degree of readability of ARs calculated based on the Flesch index. Keywords: Readability. Corporate Governance. Administrative Report.