Resumo:
Propsito do Trabalho:
The use of fair value in assets without an active market is a process that involves complex
financial models with a high degree of subjectivity, putting into question the reliability of such
accounting information. The forestry assets in the maturation process are examples of the use of
valuation models, that uses different sources of information and judgment involving several actors
such as accountant, auditor and valuators (experts in valuation of this specific asset). These
professionals must reach a final consensus on the value of that asset. Giddens (1990) discusses
Trust and Risk in modernity, where the concept of trust in modernity is based on symbolic tokens
and expert systems. Smith-Lacroix et al. (2012) applied this concept of trust in accounting
discussing the role of experts in the context of fair value measurement, and Jones & Dugdale
(2001), use these concepts to explain the current accounting regime, and socially constructed
economic, political and ideological dimensions. The aim of this paper is to analyze the process of
construction of forests assets fair value, discussing subjectivity and conflicts issues among the
actors involved from the perspective of trust and risk presented by Giddens (1990), considering as
reference the work of Smith-Lacroix et al. (2012) and Jones & Dugdale (2001).
Base da plataforma terica:
The conception of reliability entered in the accounting literature by the
work of Ijiri and Jaedick (1966) and subsequently was introduced as part of the qualitative
characteristics of accounting information in both the IASB Conceptual Framework and the FASB,
being one of the features of the faithful representation.
In the context of principle based accounting, with a significant use of fair value, Power
(2010) claims that the conception of reliability over the value perspective is not confined to an
objective examination of facts, but it is rather a construction shaped by different value perceptions
of the actors involved in the measurement process, where the role of various standard-setting
agencies (IASB, IVSC, etc.) sets parameters in order to reach a value consensus, yet not totally
eliminating its subjectivity. Consequently, it is expected that this social construction process
generates conflicts among the involved actors (Power, 2010) and, also, a reconfiguration of the
roles of these agents (Smith-Lacroix, Durocher, & Gendron, 2012).
To sum up, reliability and verifiability are already longstanding concepts present in
international accounting. And both are directly related with the concept of faithful representation of
the economic phenomenon. The objective here is to discuss reliability in a wider social sense,
assuming that the central question lies in the concept of economic reality that the accounting
numbers aim to represent (Hines, 1991) due to the impossibility to deal with this reality as
something objective and distant from the subject.
Giddens (1990) provides a sociological approach to the concept of trust and risk in modernity.
He describes modernity as a social momentum where the sense of time and space are split up and
this disengagement occurs by two mechanisms: symbolic tokens and experts’ systems, removing
the social relations from the surrounding context.
The money (and consequently the financial system) represents one of the symbolic tokens.
Now the experts’ systems refer to the professionals of a technical expertise (lawyers, economists,
etc.) that organize large areas of the current social system. The relationship of these mechanisms in
our society is given by trust, which the author defines as "a belief in the credibility of a person or
system, considering a given set of outcomes or events." In this direction, to propose the Giddens’
concepts to the interpretation of conceptual framework, we see that these rely on the experts’
reliability, especially on moments when the use of valuation models for assets without an active
market.
Jones and Dugdale (2001) use Giddens’ concepts to analyze accounting as an institution of
modernity, including their relationship with risk and trust. For these authors, the accounting regime
constitutes a set of social practices that generate information and the power of the current
accounting system depends on the corresponding extent of the confidence generated. And this
confidence is based on the risks involved, on how their specialists manage these risks and that this
sense of trust is continuously being redefined.
Smith-Lacroix et al., (2012) analyze the transformation of trust in experts’ systems compound
by the auditors in the current system of fair value, which broadens the requirement of competencies
pursuing other experts’ systems to be the valuators. As final responsible for the opinion on the
accounting numbers, auditors had to modify their routines, and develop a trust relation in the
appraisal of valuators.
Mtodo de investigao:
The purpose of this article is to analyze the process of construction of the fair value of
biological forest assets. Once this is merely a process of creating meanings and actions based on
them, the research is based on interpretative methodology to guide the analysis. In this sense, there
is no intention in this paper to pursue universal laws to describe and explain the behaviors, but to
seek a deeper understanding of the meanings and conceptions of the actors involved in the process
under study.
Aligned with this paradigm option, the research method chosen is phenomenography which
"main purpose is to extract the different concepts that a group of people perceives and deals within
a particular phenomenon" (Lopes 2012 p.83). The research is developed by comparing similarities
and differences of concepts among individuals about the studied phenomenon sorted into
categories. The collective variation in conceptions constitutes the findings of this type of approach
(Sin, 2010).
This method focuses on the different ways that individuals experience a given phenomenon.
Unlike phenomenology that focuses on the explanation of a phenomenon (descriptive
phenomenology) or the explanation of meanings given to the phenomenon by the individual
(interpretative phenomenology), the focus of phenomenography is the interpretation of the
meanings present in a group of individuals related to the phenomenon (Lopes, 2012).
The data collection method is based on interviews with the actors of the biological forest
assets fair value construction process, that according Sin (2010) is one of the most used methods to
get perceptions about a particular phenomenon process. Accountants, auditors and appraiser (forest
engineers) were interviewed. The interviews were semi-structured and conducted between
September-December/2012, with two auditors, one appraiser and one controller.
In the phenomenographic process, the analysis starts with the transcription of the interviews
and reading them together, once individual conceptions does not matter, but the similarities and
differences among the conceptions of the analyzed group are important. After that, a "space for the
results" is created basically composed of two analytical frameworks: categories of description and
dimensions of variation.
Resultados, concluses e suas implicaes:
The analysis of the interviews, results in the common categories MODEL, IMPACT ON EARNINS and DISCLOSURE AND VALIDATION; with their respective dimensions of variation.
Confidence in modernity portrayed by Giddens (1990) can be elucidated by symbolic tokens,
represented here by the Information Model needed to process data into monetary values, as well as
by the experts’ systems that gathers the involved actors in this Model: accountant, valuator and
auditor.
The analogy of the current accounting system to Giddens is quite reflective when it reveals
the complexity of social inter-relationships between data and actors, and disclaims accounting that
objective and deterministic role that makes no sense in the current context of fair value.
The central point of discussion is the Model built by each company for the processing of data, plus
the clustering of different value perceptions of various specialists. Actors’ involvement in
this Model is considered critical to its operation, since there has been a change in the internal
behavioral of the companies, as well as in the roles. It is expected that a joint work of specialists
with differentiated capabilities brings power conflicts, but the interviewees’ state about a constant
search for consensus, giving legitimacy to the process. However, this search for consensus is not
always achieved without some level of conflict, especially by the auditors in relation to the
valuators.
However, there are some factors that contribute negatively to the validation of this model. The
first one is the determination of timber future prices, where active market does not always exist.
The impact on the earnings, mainly on the volatility issue and the cash realization, is another
factor that hampers the validation of this model. If on one hand, the information on the economic
value of equity is relevant, on the other one, the weakening of the information for earnings should
be rethought.
One can find companies that have forest asset as an investment, or final product or raw
material. The question is whether the fair value of these assets should take into account the business
model of the company. The disregard of the end use of biological assets generates conflicts of the
perceived value among the actors involved and can damage the understanding of that information
by the market.
This study, despite having a limited number of interviews, confirms the argument of Power
(2010) on the redesign of the concept of reliability, which becomes a construction based on the
beliefs and arguments of experts, not only in the verifiability of documents, meeting the arguments
of researchers from the critical line in accounting: the concept "true and fair view " that is actually a
vision of the reality for a particular social group (Macintosh, 2009).
We believe this study provides a differentiated approach to reliability in the context of fair
value, promoting reflections on the feasibility or not of fair value depending on the context of the
asset being evaluated, and legitimizing the whole process that involves this paper. The main
limitation of this study was the number of interviews, which characterizes it as initial research, as
well as this study has not addressed the end of the accounting information chain: the capital
providers from whom the financial statements are made based on the IASB standards. The
reliability is analyzed here through the lens of the makers of the information, which does not
necessarily share the same view of users.
Referncias bibliogrficas:
Giddens, A. (1990). As consequências da Modernidade. (E. UNESP, Ed.) (5 reeimpre., pp. 1–156).
São Paulo.
Hines, R. D. (1988). Financial accounting: In communicating reality, we construct reality.
Accounting, Organizations and Society, 13(3), 251–261.
Hines, R. D. (1991). The FASB’s conceptual framework, financial accounting and the maintenance
of the social world. Accounting, Organizations and Society, 16(4), 313–331.
ICAEW. (2010). Business Models in Accounting : The theory of the fimr and financial reporting
(p. 85). London: ICAEW - The Institute of Chartered Accountants in England and Wales.
Jones, T. C., & Dugdale, D. (2001). The concept of an accounting regime. Critical Perspectives on
Accounting, 12(1), 35–63.
Power, M. (2010). Fair value accounting, financial economics and the transformation of reliability.
Accounting and Business Research, 40(3), 197–210.
Sin, S. (2010). Considerations of Quality in Phenomenographic Research. Internacional Journal of
Qualitative Methods, 9(4), 305–319.
Smith-Lacroix, J.-H., Durocher, S., & Gendron, Y. (2012). The erosion of jurisdiction: Auditing in
a market value accounting regime. Critical Perspectives on Accounting, 23(1), 36–53.
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