Cover
Cover | 12 Months Ended |
Dec. 31, 2019shares | |
Cover [Abstract] | |
Entity Registrant Name | TIM PARTICIPACOES SA |
Entity Central Index Key | 0001066116 |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2019 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity a Well-known Seasoned Issuer | Yes |
Entity a Voluntary Filer | No |
Entity Reporting Status Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Document Transition Report | false |
Document Shell Company Report | false |
Document Annual Report | true |
Entity Interactive Data Current | Yes |
Entity Incorporation, State or Country Code | D5 |
Entity Common Stock, Shares Outstanding | 2,421,032,479 |
Document Fiscal Period Focus | FY |
Document Fiscal Year Focus | 2019 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | ||
Current Assets | ||||
Cash and cash equivalents | R$ 2284810 | R$ 1075530 | ||
Marketable securities | 654,479 | 784,841 | ||
Trade accounts receivable | 3,184,780 | 2,838,808 | ||
Inventory | 203,278 | 183,059 | ||
Indirect taxes, charges and contributions recoverable | 420,284 | 280,254 | ||
Direct taxes, charges and contributions recoverable | 1,395,193 | 347,505 | ||
Prepaid expenses | [1] | 175,868 | 272,060 | |
Derivative Financial Instruments | 16,602 | 50,769 | ||
Financial leases | 4,931 | 22,491 | ||
Regulatory credits recoverable | 33,090 | 41,612 | ||
Other current assets | 80,814 | 101,197 | ||
Total current assets | 8,454,129 | 5,998,126 | ||
Long-term receivables | ||||
Marketable securities | 3,849 | 5,229 | ||
Trade accounts receivable | 103,075 | 130,308 | ||
Indirect taxes, charges and contributions recoverable | 823,349 | 912,511 | ||
Direct taxes, charges and contributions recoverable | 2,367,607 | 558,016 | ||
Deferred income tax and social contribution | 801,971 | |||
Judicial Deposit | 1,006,899 | 1,345,113 | ||
Prepaid expenses | [1] | 69,656 | 74,381 | |
Derivative Financial Instruments | 29,909 | 30,639 | ||
Financial leases | 151,447 | 185,558 | ||
Other current assets | 58,514 | 30,411 | ||
Totallong-term receivables | 4,614,305 | 4,074,137 | ||
Property, plant and equipment | 17,612,164 | 11,203,622 | [2] | |
Intangible | 9,668,326 | 10,682,004 | ||
Total non-current assets | 31,894,795 | 25,959,763 | ||
Total assets | 40,348,924 | 31,957,889 | ||
Current Liabilities | ||||
Suppliers | 3,923,035 | 4,323,374 | ||
Loans and financings | 1,384,180 | 698,728 | ||
Financial leases | 873,068 | 205,048 | ||
Derivative Financial Instruments | 858 | 2,373 | ||
Payroll and related charges | 218,421 | 211,685 | ||
Indirect taxes, charges and contributions payable | 463,606 | 451,169 | ||
Direct taxes, charges and contributions payable | 296,305 | 332,333 | ||
Dividends and interest on shareholders' equity payable | 577,837 | 370,105 | ||
Authorizations payable | 88,614 | 65,464 | ||
Deferred revenues | 281,930 | 406,867 | ||
Other current liabilities | 9,625 | 8,233 | ||
Total current liabilities | 8,117,479 | 7,075,379 | ||
Non-current liabilities | ||||
Loans and financings | 644,908 | 964,289 | ||
Derivative Financial Instruments | 3,547 | 9,245 | ||
Financial leases | 6,907,802 | 1,735,026 | ||
Indirect taxes, charges and contributions payable | 2,997 | 2,772 | ||
Direct taxes, charges and contributions payable | 212,310 | 209,880 | ||
Deferred income tax and social contribution | 47,734 | |||
Provision for legal and administrative proceedings | 840,637 | 849,408 | ||
Pension plan and other post-employment benefits | 5,782 | 2,850 | ||
Authorizations payable | 237,723 | 348,336 | ||
Deferred revenues | 827,182 | 906,600 | ||
Other current liabilities | 69,005 | 59,267 | ||
Total non-current liabilities | 9,799,627 | 5,087,673 | ||
Total liabilities | 17,917,106 | 12,163,052 | ||
Shareholders' equity | ||||
Capital Stock | 9,866,298 | 9,866,298 | ||
Capital reserves | 410,650 | 412,091 | ||
Profit reserves | 12,159,162 | 9,524,124 | ||
Accumulated other comprehensive income | (1,088) | 847 | ||
Treasury shares | (3,204) | (8,523) | ||
Total shareholders' equity | 22,431,818 | 19,794,837 | ||
Total liabilities and shareholders' equity | R$ 40348924 | R$ 31957889 | ||
[1] | Reclassification of the agreement for reciprocal assignment with consideration for fiber optic infrastructure previously classified as prepaid expenses (Note 11) for property, plant and equipment - right-of-use under lease; | |||
[2] | Recognition of the asset - right-of-use under lease of the lease payments eligible for the new standard; |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Profit or loss [abstract] | |||
Revenue | R$ 17377194 | R$ 16981329 | R$ 16233959 |
Costs of services provided and goods sold | (7,433,731) | (7,701,418) | (8,002,077) |
Gross income | 9,943,463 | 9,279,911 | 8,231,882 |
Operating income (expenses) | |||
Selling expenses | (4,986,289) | (4,970,780) | (4,575,177) |
General and administrative expenses | (1,717,859) | (1,608,319) | (1,424,643) |
Other income (expenses), net | 1,275,541 | (283,289) | (298,710) |
Total income expense | (5,428,606) | (6,862,388) | (6,298,530) |
Operating income | 4,514,857 | 2,417,523 | 1,933,352 |
Financial income (expenses) | |||
Financial income | 1,430,171 | 412,733 | 512,565 |
Financial expenses | (1,408,053) | (951,439) | (1,009,653) |
Foreign exchange variations, net | (908) | 1,373 | (748) |
Total financial income (expenses) | 21,210 | (537,333) | (497,836) |
Income before income and social contribution taxes | 4,536,067 | 1,880,190 | 1,435,516 |
Income and social contribution taxes | (913,940) | 664,911 | (201,009) |
Net income for the year | R$ 3622127 | R$ 2545101 | R$ 1234507 |
Earnings per share attributed to the Company's shareholders (in R$ per share) | |||
Basic earnings per share (in R$ per share) | R$ 1.50 | R$ 1.05 | R$ 0.51 |
Diluted earnings per share (in R$ per share) | R$ 1.50 | R$ 1.05 | R$ 0.51 |
COMPREHENSIVE INCOME STATEMENT
COMPREHENSIVE INCOME STATEMENT - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Profit or loss [abstract] | |||
Net income for the year | R$ 3622127 | R$ 2545101 | R$ 1234507 |
Item not to be reclassified to income: | |||
Pension plan and other post-employment benefits | (2,932) | (215) | (1,052) |
Deferred taxes | 997 | 73 | 358 |
Item to be subsequently reclassified to income: | |||
Cash flow hedge | 3,318 | ||
Deferred taxes | (1,128) | ||
Total comprehensive income for the year | R$ 3620192 | R$ 2544959 | R$ 1236003 |
STATEMENT OF CHANGES IN SHAREHO
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY - BRL (R$) R$ in Thousands | Share capital [Member] | Capital Reserve [Member] | Legal Reserve [Member] | Reserve for Expansion [Member] | Tax Benefit Reserve [Member] | Treasury Shares [Member] | Accumulated other comprehensive income [Member] | Retained Earnings [Member] | Total |
Balance at beginning at Dec. 31, 2016 | R$ 9866298 | R$ 405239 | R$ 657034 | R$ 5103908 | R$ 1158910 | R$ 3369 | R$ 507 | R$ 17187513 | |
Total comprehensive income for the year | |||||||||
Net income for the year | R$ 1234507 | 1,234,507 | |||||||
Remeasurement of post-employment benefit obligation | (694) | (694) | |||||||
Cash flow hedge | 2,190 | 2,190 | |||||||
Total comprehensive income for the year | 1,496 | 1,234,507 | 1,236,003 | ||||||
Total contributions from shareholders and distributions to shareholders | |||||||||
Stock options | 10,923 | 10,923 | |||||||
Purchases of treasury shares, net of disposals | (13,118) | (13,118) | |||||||
Allocation of net income for the period: | |||||||||
Legal reserve (Note 24) | 61,725 | (61,725) | |||||||
Dividends declared (Note 24) | (103,325) | (103,325) | |||||||
Interest on equity (note 24) | (189,991) | (189,991) | |||||||
Constitution of tax benefit reserve (note 24) | 112,493 | (112,493) | |||||||
Constitution of reserve for expansion (note 24) | 766,973 | (766,973) | |||||||
Unclaimed dividends (note 24) | 23,179 | 23,179 | |||||||
Total contributions from shareholders and distributions to shareholders | 10,923 | 61,725 | 790,152 | 112,493 | (13,118) | (1,234,507) | (272,332) | ||
Balance at end at Dec. 31, 2017 | 9,866,298 | 416,162 | 718,759 | 5,894,060 | 1,271,403 | (16,487) | 989 | 18,151,184 | |
Changes in equity [Roll forward] | |||||||||
Impact of initial adoption of new accounting pronouncements (Note 2.f) | (62,119) | (62,119) | |||||||
Balance at beginning, adjusted | 9,866,298 | 416,162 | 718,759 | 5,831,941 | 1,271,403 | (16,487) | 989 | 18,089,065 | |
Total comprehensive income for the year | |||||||||
Net income for the year | 2,545,101 | 2,545,101 | |||||||
Remeasurement of post-employment benefit obligation | (142) | (142) | |||||||
Total comprehensive income for the year | (142) | 2,545,101 | 2,544,959 | ||||||
Total contributions from shareholders and distributions to shareholders | |||||||||
Stock options | (4,071) | (4,071) | |||||||
Purchases of treasury shares, net of disposals | 7,964 | 7,964 | |||||||
Allocation of net income for the period: | |||||||||
Legal reserve (Note 24) | 119,933 | (119,933) | |||||||
Interest on equity (note 24) | (849,994) | (849,994) | |||||||
Constitution of tax benefit reserve (note 24) | 146,455 | (146,455) | |||||||
Constitution of reserve for expansion (note 24) | 1,428,719 | (1,428,719) | |||||||
Unclaimed dividends (note 24) | 6,914 | 6,914 | |||||||
Total contributions from shareholders and distributions to shareholders | (4,071) | 119,933 | 1,435,633 | 146,455 | 7,964 | (2,545,101) | (839,187) | ||
Balance at end at Dec. 31, 2018 | 9,866,298 | 412,091 | 838,692 | 7,267,574 | 1,417,858 | (8,523) | 847 | 19,794,837 | |
Total comprehensive income for the year | |||||||||
Net income for the year | 3,622,127 | 3,622,127 | |||||||
Remeasurement of post-employment benefit obligation | (1,935) | (1,935) | |||||||
Total comprehensive income for the year | (1,935) | 3,622,127 | 3,620,192 | ||||||
Total contributions from shareholders and distributions to shareholders | |||||||||
Stock options | (1,441) | (1,441) | |||||||
Purchases of treasury shares, net of disposals | 5,319 | 5,319 | |||||||
Allocation of net income for the period: | |||||||||
Legal reserve (Note 24) | 171,398 | (171,398) | |||||||
Interest on equity (note 24) | (995,438) | (995,438) | |||||||
Constitution of tax benefit reserve (note 24) | 194,161 | (194,161) | |||||||
Constitution of reserve for expansion (note 24) | 2,261,130 | (2,261,130) | |||||||
Unclaimed dividends (note 24) | 8,349 | 8,349 | |||||||
Total contributions from shareholders and distributions to shareholders | (1,441) | 171,398 | 2,269,479 | 194,161 | 5,319 | R$ 3622127 | (983,211) | ||
Balance at end at Dec. 31, 2019 | R$ 9866298 | R$ 410650 | R$ 1010090 | R$ 9537053 | R$ 1612019 | R$ 3204 | R$ 1088 | R$ 22431818 |
STATEMENT OF CASH FLOWS
STATEMENT OF CASH FLOWS - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating activities | |||
Income before income and social contribution taxes | R$ 4536067 | R$ 1880190 | R$ 1435516 |
Adjustments to reconcile income with net cash from operations | |||
Depreciation and amortization | 5,128,981 | 3,954,321 | 4,013,671 |
(Gain) loss on the sale of property, plant and equipment (leaseback) | 1,801 | ||
Residual value of property, plant and equipment and intangible assets written off | 32,411 | 9,700 | 54,104 |
Interest from obligations arising from asset retirement obligation | 226 | 648 | 428 |
Provision for legal and administrative proceedings | 547,691 | 551,191 | 372,469 |
Monetary adjustments to deposits, administrative and legal proceedings | 200,469 | 297,529 | 97,805 |
Interest, monetary and exchange variations of borrowings and other financial adjustments | (950,675) | (35,450) | 521,570 |
Lease interest payable | 821,463 | 266,328 | 257,305 |
Lease interest receivable | (6,422) | (25,664) | (22,709) |
Provision for doubtful debts | 748,291 | 544,881 | 316,387 |
Stock options | 3,443 | (1,424) | 10,923 |
Total adjustments to reconcile income with net cash from operations | 11,061,945 | 7,442,250 | 7,059,270 |
Decrease (increase) in operating assets | |||
Trade accounts receivable | (1,027,131) | (1,028,791) | 99,674 |
Taxes and contributions recoverable | (1,601,276) | 175,116 | 162,705 |
Inventory | (20,219) | (59,274) | 20,149 |
Prepaid expenses | 100,917 | 56,792 | (40,490) |
Judicial Deposit | 296,486 | 30,478 | (53,217) |
Other current assets | 5,059 | 133,831 | (26,129) |
Increase (decrease) in operating liabilities | |||
Payroll and related charges | 6,736 | (50,765) | 50,171 |
Suppliers | (401,200) | 331,736 | 523,419 |
Taxes, charges and contributions | 40,045 | 187,170 | (177,478) |
Authorizations payable | (100,182) | (104,582) | (895,964) |
Payments for legal and administrative proceedings | (715,203) | (536,646) | (439,670) |
Deferred revenues | (204,355) | (193,599) | (415,651) |
Other current liabilities | (215,063) | (40,373) | (165,598) |
Cash generated by operations | 7,226,559 | 6,343,343 | 5,701,191 |
Income tax and social contribution paid | (161,833) | (213,956) | (297,079) |
Net Cash from Operations | 7,064,726 | 6,129,387 | 5,404,112 |
Cash from investment activities | |||
Marketable securities | 131,742 | (21,460) | (288,658) |
Additions to property, plant and equipment and intangible assets | (3,853,484) | (3,831,906) | (4,147,907) |
Cash received from property, plant and equipment sales | 13,850 | ||
Receipt of financial leases | 9,100 | 22,946 | 22,140 |
Net cash used in investment activities | (3,712,642) | (3,830,420) | (4,400,575) |
Cash from financing activities | |||
New borrowing | 1,000,000 | 166,548 | 646,853 |
Repayment of borrowing | (723,500) | (3,359,074) | (2,890,565) |
Interest paid - borrowing and financings | (96,649) | (193,333) | (380,005) |
Payment of financial lease | (800,621) | (9,898) | (14,340) |
Interest paid - Leases | (785,091) | (242,512) | (204,849) |
Derivative Financial Instruments | 32,761 | 37,044 | 17,677 |
Purchases of treasury shares, net of disposals | 435 | 5,317 | (13,118) |
Dividends and interest on shareholders' equity paid | (770,139) | (588,247) | (332,658) |
Net cash used in financing activities | (2,142,804) | (4,184,155) | (3,171,005) |
Increase (decrease) in cash and cash equivalents | 1,209,280 | (1,885,188) | (2,167,468) |
Cash and cash equivalents at the beginning of the year | 1,075,530 | 2,960,718 | 5,128,186 |
Cash and cash equivalents at the end of the year | 2,284,810 | 1,075,530 | 2,960,718 |
Additions to property, plant and equipment and intangible assets, without cash effects | (6,653,985) | (38,944) | (48,957) |
Increase in lease liabilities, without cash effects | R$ 6653985 | R$ 38944 | R$ 48957 |
1. Operations
1. Operations | 12 Months Ended |
Dec. 31, 2019 | |
Operations [Abstract] | |
Operations | 1. Operations 1. a Corporate Structure TIM Participações S.A. (“TIM Participações” and/or the “Company”) is a publicly-held corporation based in the city of Rio de Janeiro, State of Rio de Janeiro, and a subsidiary of TIM Brasil Serviços e Participações S.A. (“TIM Brasil”). TIM Brasil is a subsidiary of the Telecom Italia Group and held 66.58% of the capital of TIM Participações as at December 31, 2019 and 2018. The main purpose of the Company and its subsidiary (the “Group”) is to control companies providing telecommunications services, including personal mobile telecom services and others, in their licensed areas. The services provided by TIM Participações’ subsidiary are regulated by the Agência Nacional de Telecomunicações (“ANATEL”). The Company’s shares are traded on B3 (formerly BM&F/Bovespa). Additionally, TIM Participações trades its Level II American Depositary Receipts ("ADRs") on the New York Stock Exchange ("NYSE") – USA. Accordingly, the Company is subject to the rules of the Brazilian Securities Commission (Comissão de Valores Mobiliários or “CVM”) and the U.S. Securities and Exchange Commission (“SEC”). In accordance with market best practice, TIM Participações adopts the practice of simultaneously releasing its financial information in Reais Corporate reorganization On July 25, 2017, the meeting of the Board of Directors of the Company approved the corporate restructuring of the subsidiaries TIM Celular S.A. and Intelig Telecomunicações Ltda. (“Intelig”) through the takeover of TIM Celular by Intelig. On September 6, 2017, the corporate act transforming Intelig into a closely-held joint stock company was annotated, and its corporate name was changed to TIM S.A. On September 30, 2018, the Company’s Management had obtained from third parties all approvals and consents required to perform the said restructuring. As a result, the Company’s Management proceeded with the merger on October 31, 2018, based on the net book assets of TIM Celular, in the amount of R$17,035,254, in accordance with the valuation report issued by independent experts. Also, as a result of this corporate restructuring, the amount of R$952,368 relating to deferred income tax assets arising from tax losses and the negative base of TIM S.A. were recognized on September 30, 2018 (Note 10). The changes in TIM Celular’s equity between the date of the report and the merger were transferred, absorbed and incorporated into the operating income of TIM S.A., as set forth in the protocol of the merger. As a result of the merger, all TIM Celular operations were transferred to TIM S.A., which succeeded it in all its assets, rights and liabilities, universally and for all purposes of the law. Direct subsidiary – TIM S.A. TIM S.A. (current name of INTELIG TELECOMUNICAÇÕES LTDA. and successor by merger of TIM CELULAR S.A.) The Company holds 100% of TIM S.A.’s capital. This subsidiary provides Landline Telephone Services (“STFC”) - Domestic Long-Distance and International Long-Distance Voice Services, Personal Mobile Service (“SMP”) and Multimedia Communication Services (“SCM”) in all Brazilian states and in the Federal District. |
2. Basis for preparation and di
2. Basis for preparation and disclosure of the financial statements | 12 Months Ended |
Dec. 31, 2019 | |
Basis For Preparation And Disclosure Of The Consolidated Financial Statements [Abstract] | |
Basis for preparation and disclosure of the financial statements | 2. Basis for preparation and disclosure of the financial statements The consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”), and disclose all (and only) the applicable significant information related to the consolidated financial statements, which is consistent with the information utilized by management in the performance of its duties. The significant accounting policies applied to the preparation of this financial statements are described below and/or presented in the respective notes. These policies were consistently applied to the years presented, unless otherwise indicated. a. General preparation and disclosure criteria The financial statements were prepared taking into account the historical cost as the base value as well as financial assets and liabilities (including derivative financial instruments) measured at fair value. Assets and liabilities are reported according to their degree of liquidity and collectability. They are reported as current when they are likely to be realized or settled over the next 12 months. Otherwise, they are recorded as non-current. The exception to this procedure involves deferred income tax and social contribution balances (assets and liabilities) and contingent liabilities that are fully classified as long-term. Interests paid are classified as financing cash flow in the statement of cash flows as it represents costs of obtaining financial resources. b. Functional currency and presentation currency The presentation currency for the financial statements is the Real Transactions in foreign currency are recognized at the exchange rate on the date of the transaction. Monetary items in foreign currency are converted into Reais c. Segment information Operating segments are the components of the entity that develop business activities from which revenue can be obtained and in relation to which expenses are incurred. Their operating results are regularly reviewed by the entity’s chief operating decision maker to make decisions on the allocation of resources and to assess the performance of each segment. For a segment to exist, it must have separate financial information available. The Group’s strategy is to optimize the consolidated results of TIM Participações. This strategy includes optimizing the operations of each Group company, in addition to taking advantage of the synergies generated between them. Notwithstanding the various business activities, the decision makers see the Group as a single business segment and do not take into account specific strategies intended for a particular line of service. All decisions on strategic, financial, purchasing, investment and fund investment planning are made on a consolidated basis. The aim is to maximize the consolidated result obtained by exploring the SMP, STFC and SCM licenses. d. Consolidation procedures Subsidiaries are all entities over which the Group holds control. The Group controls an entity when it is liable or has rights to variable returns on the basis of its involvement with the subsidiaries and has the ability to affect those returns through its power over the investee. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. The consolidation is discontinued from the date that the Group loses control over that entity. The purchase accounting method is used to record the acquisition of subsidiaries by the Group. The acquisition cost is measured as the fair value of the acquired assets, equity instruments (e.g. shares) issued and liabilities incurred or assumed by the acquirer at the date when control is exchanged. Identifiable assets acquired, contingencies and liabilities assumed in a business combination are initially measured at their fair value as at the acquisition date, irrespective of the proportion of any minority interest. The excess of the acquisition cost over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of net assets of the subsidiary acquired, the difference is recognized directly in the statement of income as revenue, after a review of the concepts and calculations applied. Transactions between Group companies, as well as balances, unrealized gains and losses related to these transactions, are eliminated. The accounting policies of the subsidiary were adjusted to ensure consistency with the accounting policies adopted by TIM Participações. The dates of the financial statements used in the consolidation are the same for all Group companies. e. Approval of the financial statements These financial statements were approved by the Company’s Board of Directors on April 17, 2020. f. New standards, amendments and interpretations of standards I) Among the new standards that became effective as of January 1, 2019 issued by the IASB, the following standards had a material impact on the Company’s consolidated financial statements: IFRS 16 – “Leases” In July 2014, the IASB issued IFRS 16, which replaced IAS 17 and refers to annual periods beginning on or after January 1, 2019 and approved by the CVM on December 21, 2017. The new standard establishes the principles for the recognition, measurement, reporting and disclosure of leases, and requires the recognition by lessees of assets and liabilities arising from lease agreements, except for short-term contracts, that is, with a term of 12 months or less, or contracts in which the value of the underlying assets is low. In accordance with this standard, lessees must apply this pronouncement to lease agreements in two ways: (i) Retrospectively for each previous period presented in accordance with IAS 8 (Accounting Policies, Changes in Estimates and Correction of Errors); or (ii) Retrospectively, with the cumulative effect of the initial application of this pronouncement, recognized as an adjustment to the opening balance of retained earnings (or other component of the shareholders’ equity, as appropriate) as at the date of initial application. The Company decided to adopt IFRS16 retrospectively, while the cumulative effect of the initial application is recognized on the date of initial application, that is, January 1, 2019. Additionally, the Company decided to take practical steps in its initial adoption of the standard, such as: (i) non-revaluation of financial lease agreements previously recognized according to IAS 17 upon initial measurement of financial lease liabilities, according to the new accounting pronouncement, and IFRIC 4; (ii) exclusion of lease agreements expiring in the next 12 months and unlikely to be renewed by the Company and the exclusion of leasing contracts considered of low value; (iii) non-application of this new standard to agreements not previously identified as leases, using IAS 17 and IFRIC 4; and (iv) application of a single discount rate to the leasing portfolio with reasonably similar characteristics (such as leasing with a similar remaining leasing period for a similar class of underlying assets in a similar economic setting). The Company had a significant number of lease agreements under which it is the lessee. Currently, a portion of these contracts are recognized as operating leases, and their payments are recorded on a straight-line basis throughout the period of the contract. The Company concluded the study of impacts of this new standard on its financial statements, which included: (i) an estimation of the lease term, considering a non-cancelable period and the periods covered by options to extend the lease term, where such exercise depends only on the Company and is reasonably certain; (ii) a detailed review of the nature of the various lease agreements inherent in the telecommunications industry; (iii) use of assumptions to calculate the discount rate, which was based on the incremental interest rate for the period of the agreement, among other things. Furthermore, given the relevance of the infrastructure lease agreements, specifically for transmission towers, the Company decided to separately recognize the lease and non-lease components for this class of assets. The increase in lease liabilities due to the recognition of the right-of-use of the assets results in an increase in the Company's net debt, being the depreciation and interest charges recognized in the statement of income as a replacement of the operating lease expenses. In qualitative terms, the main transactions to be impacted by the new standard include: lease of vehicles, lease of stores and kiosks in shopping malls, lease of sites, land and sharing of infrastructure. The table below presents the principal effects of the adoption of IFRS16 in the opening balances as at January 1, 2019. Originally reported Adjustments Balances under IFRS 16 Jan 1 st Jan 1 st Assets 31,957,889 5,256,114 37,214,003 Current assets 5,998,126 (8,742) 5,989,384 Trade accounts receivable 2,838,808 - 2,838,808 Inventories 183,059 - 183,059 Prepaid expenses (a) 272,060 (8,742) 263,318 Other assets 2,704,199 2,704,199 Non-current assets 25,959,763 5,264,856 31,224,619 Long-term receivables 4,074,137 (471) 4,073,666 Trade accounts receivable 130,308 130,308 Prepaid expenses (a) 74,381 (471) 73,910 Other assets 3,869,448 3,869,448 Property, plant and equipment (b) 11,203,622 5,265,327 16,468,949 Intangible assets 10,682,004 10,682,004 Liabilities and Shareholders’ Equity 31,957,889 5,256,114 37,214,003 Total Liabilities 12,163,052 5,256,114 17,419,166 Current Liabilities 7,075,379 785,065 7,860,444 Financial leasing (c) 205,048 785,065 990,113 Other liabilities 6,870,331 6,870,331 Non-Current Liabilities 5,087,673 4,471,049 9,558,722 Financial leasing (c) 964,289 4,471,049 5,435,338 Deferred income tax and social contribution - - Other Liabilities 4,123,384 4,123,384 Shareholders’ Equity 19,794,837 - 19,794,837 Capital stock 9,866,298 9,866,298 Revenue reserves 9,928,539 9,928,539 During the fiscal year ended December 31, 2019, the new accounting standards had the following impact on the income statement: Statements of income Balances without Adjustments Balances with IFRS 16 IFRS 16 Net revenue from services 16,597,155 - 16,597,155 Net revenue from products 780,039 - 780,039 Net revenue 17,377,194 - 17,377,194 Cost of services provided and goods sold (a), (d) (4,494,914) 1,193,407 (3,301,507) 12,882,280 1,193,407 14,075,687 (4,554,127) 122,278 (4,431,849) Operating income (expenses) Selling expenses (e) (4,800,325) 70,935 (4,729,390) General and administrative expenses (f) (1,029,343) 51,343 (978,000) Other revenues (expenses), net 1,275,541 - 1,275,541 8,328,153 1,315,685 9,643,838 Depreciation and amortization (g) (4,188,837) (940,144) (5,128,981) Financial income (expenses) 613,533 (592,323) 21,210 Income before income and social contribution taxes 4,752,849 (216,782) 4,536,067 Income and social contribution taxes (h) (987,646) 73,706 (913,940) Net income for the year 3,765,203 (143,076) 3,622,127 There is no material impact on other comprehensive results or basic diluted earnings per share. Statement of Cash Flows Balances without Adjustments Balances with IFRS 16 IFRS 16 Net income for the period before income tax and social contribution 4,752,850 (216,783) 4,536,067 Adjustments to reconcile net income to net cash generated by activities Lease interest payable 229,139 592,324 821,463 Depreciation and amortization 4,188,837 940,144 5,128,981 Net cash from operations 5,749,042 1,315,684 7,064,726 Net cash invested in investment activities (3,721,742) - (3,721,742) Net cash used in financing activities (827,120) (1,315,684) (2,142,804) Increase in cash and cash equivalents 1,209,280 - 1,209,280 Cash and cash equivalents at the beginning of the year 1,075,530 - 1,075,530 Cash and cash equivalents at the end of the year 2,284,810 - 2,284,810 The principal adjustments arising from the new standard are as follows: (a) Reclassification of the agreement for reciprocal assignment with consideration for fiber optic infrastructure previously classified as prepaid expenses (Note 11) for property, plant and equipment – right-of-use under lease; (b) Recognition of the asset – right-of-use under lease of the lease payments eligible for the new standard; (c) Increase in the Company’s net debt due to the recognition of the lease liability as required by the standard; (d) Leasing – infrastructure (network, land and fiber optics); (e) Leasing – stores & kiosks and vehicles; (f) Leasing – administrative buildings and vehicles; (g) Recognition of the depreciation of the assets mentioned above; (h) Tax impact on the adjustments from the new standard. IFRIC 23 – Uncertainty about the treatment of income taxes The Interpretation deals with the accounting of taxes on profit in cases where the tax treatments involve uncertainty affecting the application of IAS 12 - Income Tax and does not apply to taxes outside the scope of IAS 12, nor specifically includes the requirements relating to interest and fines associated with uncertain tax treatments. The Interpretation specifically addresses the following: How to apply the tax legislation to specific transactions or circumstances; Or if the tax authorities would accept a specific tax treatment adopted by the entity. If the entity considers that a given tax treatment may not be accepted, the entity must use estimates (most probable or expected amount) to determine the tax treatment (taxable income, tax bases, tax liabilities not used, tax assets not used), income tax rates and others. This decision must rely on the method that provides the best estimates for resolution of the uncertainty. The Company’s Management concluded that the application of this standard did not significantly impact the financial statements, since the most important judicial proceedings involving income tax and social contribution, as disclosed in Note 23, are considered by the administration and the legal counsels as being “more likely than not” in the arguments of the judicial spheres. II) The following new standards were issued by International Standards Board (IASB) but are not in force for the period ended December 31, 2019. · IFRS 17 – Insurance contracts In May 2017, the IASB issued IFRS 17 – Insurance Contracts. The general purpose of IFRS 17 is to provide an accounting model for insurance contracts that is most useful and consistent for insurers. · IFRS 3: Definition of business In October 2018, the IASB issued changes to the business definition in IFRS 3 to help entities determine whether an acquired set of activities and assets consists of or not in a business. They clarify the minimum requirements for a company, eliminate the assessment of whether market participants are capable of replacing any missing elements, include guidance to help entities assess whether an acquired process is substantive, better delimit business and product definitions, and introduce an optional fair value concentration test. New illustrative cases have been provided along with the changes. As the changes apply prospectively to transactions or other events that occur on or after the first application, the Company will not be affected by these changes on the transition date. · IAS 8: Definition of material omission In October 2018, the IASB issued amendments to IAS 1 and IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors to align the definition of 'material misstatement' or 'material misstatement' across the standards and clarify certain aspects of the definition. The new definition states that: "the information is material if its omission, misstatement or obscureness could reasonably influence decisions that major users of general purpose financial statements make on the basis of those financial statements, which provide financial information about entity-specific reporting. These changes are not expected to have a significant impact on the Company's consolidated financial statements. |
3. Estimates and areas where ju
3. Estimates and areas where judgment is significant in the application of the Company' accounting policies | 12 Months Ended |
Dec. 31, 2019 | |
Estimates And Areas Where Judgment Is Significant In The Application Of The Company'S Accounting Policies [Abstract] | |
Estimates and areas where judgment is significant in the application of the Company's accounting policies | 3 Estimates and areas where judgment is significant in the application of the Company’s accounting policies Accounting estimates and judgments are continuously reassessed. They are based on the Company´s historical experience and other factors, such as expectations of future events, considering the circumstances as at the date of the financial statements. By definition, the accounting estimates resulting from such assumptions rarely equal the actual outcome. The estimates and assumptions that present a significant risk of causing relevant adjustments in the book values of assets and liabilities in subsequent fiscal years are shown below: (a) Impairment losses on non-financial assets Losses due to impairment take place when the book value of an asset or cash generating unit exceeds its respective recoverable value, which is considered as the fair value less costs to sell and/or the value in use, whichever is greater. The calculation of the fair value less costs to sell is based on information available from sales transactions involving similar assets or market prices, less additional costs that would be incurred to dispose of those assets. The value in use is based on the discounted cash flow model. Any reorganization activities to which the Company has not yet committed itself on the financial statements disclosure date, or any material future investments aimed at improving the asset base of the cash generating unit being tested, are excluded for the purpose of impairment testing. The main non-financial assets valued this way were goodwill based on the future profitability recorded by the Company (Note 14) and its tangible assets. (b) Income tax and social contribution (current and deferred) Income tax and social contribution (current and deferred) are calculated in accordance with interpretations of the legislation currently in force and IAS 12. This process normally includes complex estimates to define the taxable income and temporary differences. In particular, deferred tax assets on income tax and social contribution losses and temporary differences are recognized to the extent that it is probable that future taxable income will be available and can be offset. The measurement of the recoverability of deferred income tax and social contribution losses carry-forward and of temporary differences takes into account the history of taxable income, as well as estimates of future taxable income (Note 10). (c) Provision for legal and administrative proceedings Legal and administrative proceedings are analyzed by the Company’s Management and internal and external legal advisors. The Company’s review takes into account factors such as the hierarchy of laws, case law available, recent court decisions, their relevance to the legal order, as well as payment history. Such reviews involve Management’s judgment (Note 23). (d) Fair value of derivatives and other financial instruments Financial instruments presented at fair value in the balance sheet are measured using evaluation techniques that take into account observable data or observable data derived from the market (Note 36). (e) Unbilled revenue Considering that some billing cut-off dates occur on intermediate dates within the months, at the end of each month there will be revenue already earned by the Company but not effectively billed to the customers. This unbilled revenue is recorded based on estimates which take into account data on usage, the number of days since the last billing date, among other factors (Note 26). (f) Leasing The Company has a significant number of lease agreements in which it is the lessee, whereby with the adoption of accounting standard IFRS 16 – Leasing, as disclosed in Note 2.f., the Company’s Management made certain judgments when measuring the lease liability and the right-of-use assets, such as: (i) an estimation of the lease term, considering a non-cancelable period and the periods covered by options to extend the lease term, where such exercise depends only on the Company and is reasonably certain; (ii) use of certain assumptions to calculate the discount rate. The Company is not able to readily determine the interest rate implicit in the lease and therefore considers its incremental rate on loans to measure lease liabilities. The incremental rate is the interest rate that the Company would have to pay when borrowing, for a similar term and with similar collateral, the resources necessary to obtain the asset with similar value to the asset with similar right of use in a similar economic environment. Therefore, this assessment requires management to consider estimates when no observable rates are available. Or when they need to be adjusted to reflect the terms and conditions of a lease. The Company estimates the incremental rate using observable data (such as market interest rates) when available and considers in this estimate aspects that are specific to the Company (such as the cost of the subsidiary's debt). The Company´s average incremental rate is 10.55% for an average lease term as described in note 13. |
4. Cash and cash equivalents
4. Cash and cash equivalents | 12 Months Ended |
Dec. 31, 2019 | |
Cash and cash equivalents [abstract] | |
Cash and cash equivalents | 4 Cash and cash equivalents These are financial assets measured at amortized cost through the effective interest rate method. The Company’s Management determines the classification of its financial assets upon initial recognition. 2019 2018 Cash and banks 101,928 93,960 Unrestrictedly available financial investments: CDBs/Repurchases 2,182,882 981,570 2,284,810 1,075,530 Bank Deposit Certificates (“CDBs”) and Repurchases are nominative securities issued by banks and sold to the public as a means of raising funds. Such securities can be traded during the contracted period, at any time, without any significant loss of value, and are used to repay the short-term obligations of the Company. The annual average return on the Company’s investments in CBDs and Repurchases is 99.95% (100.27% at December 31, 2018) of the Interbank Deposit Certificate (“CDI”) rate. |
5. Marketable securities
5. Marketable securities | 12 Months Ended |
Dec. 31, 2019 | |
Marketable Securities [Abstract] | |
Marketable securities | 5 Marketable securities 2019 2018 FUNCINE (3) 3,849 5,229 Fundo Soberano (4) 7,329 14,472 FIC: (1) Government securities 179,390 292,708 Repo transactions (2) 216,196 289,352 Financial bills 105,857 96,868 Other (5) 145,707 91,441 658,328 790,070 Current portion (654,479) (784,841) Non-current portion 3,849 5,229 (1) (2) (3) (4) (5) |
6. Trade accounts receivable
6. Trade accounts receivable | 12 Months Ended |
Dec. 31, 2019 | |
Trade Accounts Receivable [Abstract] | |
Trade accounts receivable | 6 Trade accounts receivable These are financial assets measured at amortized cost, and refer to accounts receivable from users of telecommunications services, from network use (interconnection) and from sales of handsets and accessories. Accounts receivable are recorded at the price charged at the time of the transaction. The balances of accounts receivable also include services provided and not billed (“unbilled”) up to the balance sheet date. Accounts receivable from clients are initially recognized at fair value and subsequently measured at amortized cost using the effective interest rate method less the provision for expected credit losses ("impairment"). The provision for expected credit losses was recognized as a reduction in accounts receivable based on the profile of the subscriber portfolio, the aging of overdue accounts receivable, the economic situation, the risks involved in each case and the collection curve, at an amount deemed sufficient by Management, as adjusted to reflect current and prospective information on macroeconomic factors that affect the customers’ ability to settle the receivables. The fair value of trade accounts receivable equals the carrying value recorded as at December 31, 2019 and 2018. A portion of the accounts receivable from clients is used to secure the total amount of BNDES borrowing (Note 19). 2019 2018 Trade accounts receivable 3,287,855 2,969,116 Gross accounts receivable 4,061,932 3,656,044 Billed services 2,076,569 1,733,229 Unbilled services 858,418 774,484 Network use (interconnection) 438,168 455,228 Sale of goods 670,573 691,312 Contractual asset (note 22) 15,142 130 Other accounts receivable 3,062 1,661 Provision for expected credit losses (774,077) (686,928) Current portion (3,184,780) (2,838,808) Non-current portion 103,075 130,308 The non-current portion includes the amount of R$68.639 (R$102.960 on December 31, 2018) related to accounts receivable from other telephone carriers, recorded at present value considering the period and implicit interest rate in the transaction. Change in provision for expected credit losses, recorded as an asset reducing account, were as follows: 2019 2018 Opening balance 686,928 464,745 Setup of provision (note 27) 748,291 544,881 Impact of adopting IFRS 9 - 130,137 Write-off of provision (661,142) (452,835) Final Balance 774,077 686,928 The aging of accounts receivable is as follows: 2019 2018 Total 4,061,932 3,656,044 Falling due 2,576,307 2,459,315 Overdue up to 30 days 328,457 308,744 Overdue up to 60 days 146,200 144,309 Overdue up to 90 days 149,852 117,759 Invoices overdue more than 90 days 861,116 625,917 |
7. Inventory
7. Inventory | 12 Months Ended |
Dec. 31, 2019 | |
Inventory [Abstract] | |
Inventory | 7 Inventory Inventories are stated at average acquisition cost. A loss is recognized to adjust the cost of handsets and accessories to their net realizable value (selling price) when this amount is less than the average acquisition cost. 2019 2018 Total inventories 203,278 183,059 Inventory 214,889 189,826 Mobile handsets and tablets 146,295 145,819 Accessories and prepaid cards 61,436 33,621 TIM chips 7,158 10,386 Losses on adjustment to realizable amount (11,611) (6,767) |
8. Indirect taxes, charges and
8. Indirect taxes, charges and contributions recoverable | 12 Months Ended |
Dec. 31, 2019 | |
Indirect Taxes, Charges And Contributions Recoverable [Abstract] | |
Indirect taxes, charges and contributions recoverable | 8. Indirect taxes, charges and contributions recoverable 2019 2018 Indirect taxes, charges and contributions recoverable 1,243,633 1,192,765 ICMS 1,201,502 1,152,741 Others 42,131 40,024 Current portion (420,284) (280,254) Non-current portion 823,349 912,511 ICMS (value added tax on goods and services) amounts recoverable primarily refer to: (i) credits on the acquisition of property, plant and equipment directly related to the provision of telecommunication services (credits divided over 48 months), and (ii) ICMS amounts paid under the tax substitution regime from goods acquired for resale, mainly mobile handsets, chips, tablets and modems sold by TIM. |
9. Direct taxes, charges and co
9. Direct taxes, charges and contributions recoverable | 12 Months Ended |
Dec. 31, 2019 | |
Direct Taxes, Charges And Contributions Recoverable [Abstract] | |
Direct taxes, charges and contributions recoverable | 9. Direct taxes, charges and contributions recoverable 2019 2018 Direct taxes, charges and contributions recoverable 3,762,800 905,521 Income tax (IR) and social contribution (CS) (i) 428,443 414,408 PIS / COFINS (ii) 3,244,549 384,093 Others 89,808 107,020 Current portion (1,395,193) (347,505) Non-current portion 2,367,607 558,016 i) The amounts corresponding to income and social contribution taxes are substantially related to: (a) advances made over the period during which the use will take place at the closing of the current year and any balances in the next year; and (b) other income and social contribution tax credits from previous years whose current estimated period of use will be more than 12 months later. (ii) The PIS/COFINS amounts recoverable mainly refer to credits from a legal proceedings filed by TIM Celular S.A. (ultimately merged into TIM S.A., as well as TIM S.A. itself, with a favorable final decision in Higher Courts which discussed the exclusion of the ICMS from the PIS and COFINS tax bases. According to the Company's internal evaluation, we expect to use such credits within the statute of limitations of up to 5 years. In March 2017, the Federal Supreme Court (“STF”) recognized the unconstitutionality of including ICMS amounts in the calculation base of PIS and COFINS contributions. TIM S.A. (previously named “Intelig Telecomunicações Ltda.”), as the surviving company from the merger of TIM Celular S.A. and other entities existing in the Group in the past, which had filed proceedings of the same nature), has been challenging this issue in court since 2006, with effects retroactive to five years, as permitted by the legislation. In June 2019, by reason of a final and without appeal decision and calculation of values, the amount of R$2,875 million was recorded, being R$1,720 million of which corresponds to the principal, and R$1,155 million to monetary adjustments (amounts relating to TIM Celular S.A., which merged into TIM S.A. in October 2018). In September 2019, because a final, non-appealable judgment was entered and amounts were awarded, the amount of R$148 million was recorded, of which R$75 million corresponds to the principal, and R$73 million to monetary adjustments, and such amounts being related to TIM S.A. itself (when it still did business under the name Intelig Telecomunicações Ltda.). The amount recorded are updated monthly at the interest rate equivalent to the reference rate of the Special Settlement and Custody System (Selic), available on the website of the Brazilian Federal Revenue. |
10. Deferred income tax and soc
10. Deferred income tax and social contribution | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Income Tax And Social Contribution [Abstract] | |
Deferred income tax and social contribution | 10. Deferred income tax and social contribution Deferred income tax and social contribution are recognized on: (1) accumulated income tax carried forward losses and negative basis of social contribution, and (2) temporary differences arising from differences between the tax bases of assets and liabilities and their carrying values in the financial statements. Deferred income tax is determined using the tax rates (and tax laws) enacted, or substantially enacted, up to the balance sheet date. Subsequent changes in tax rates or tax legislation may modify the deferred tax credit and debit balances. Deferred tax assets on income tax and social contribution are recognized only in the event of a profitable track record and/or when the annual forecasts prepared by the Company, examined by the Supervisory Board and Statutory Audit Committee and approved by other Management bodies, indicate the likelihood of the future realization of those tax balances. The balances of deferred income tax and social contribution assets and liabilities are shown in the balance sheet at their net amounts, when there is both a legal right and an intention to offset them at the time when the current taxes are ascertained, usually in relation to the same legal entity and the same taxation authority. Thus, deferred tax assets and liabilities belonging to different entities are in general shown separately, not at their net amounts. As at December 31, 2019 and 2018, the prevailing tax rates were 25% for income tax and 9% for social contribution. In addition, there is no statute of limitation in regard to the income tax and social contribution carried forward losses, which it can be offset by up to 30% of the taxable profit reached at each fiscal year, according to the current tax legislation. The amounts recorded are as follows: 2019 2018 Losses carried forward – income tax and social contribution 800,711 896,100 Temporary differences: Provision for legal and administrative proceedings 295,853 293,349 Losses from doubtful accounts 271,611 244,428 Adjustments to present value – 3G license 7,182 9,124 Deferred income tax on accounting adjustments 56,208 58,268 Lease of LT Amazonas infrastructure 27,434 24,978 Profit sharing 23,704 22,181 Taxes with suspended enforceability 12,872 12,872 Amortized goodwill – TIM Fiber (370,494) (370,494) Derivative financial instruments (13,139) (22,551) Capitalized interest on 4G authorization (291,783) (301,525) Deemed costs – TIM S.A. (67,748) (82,042) Exclusion of ICMS from PIS and COFINS calculation bases (1,023,928) - IFRS16 Lease 209,234 - Other 87,214 74,821 24,931 859,509 Unrecognized deferred income tax and social contribution Taxes with suspended enforceability (72,665) (57,538) (47,734) 801,971 Deferred tax assets portion - 801,971 Deferred tax liabilities portion (47,734) - TIM S.A. As previously communicated to the market, TIM Celular S.A. merged into TIM S.A. (previously named “Intelig Telecomunicações Ltda.”) on October 31, 2018 with the main objective of reducing the operating costs of the companies involved, creating synergies and enabling the achievement of the corporate purposes of the two companies. Thus, after the merger, tax credits may also arise from tax losses and negative social contribution base on the income of TIM S.A., considering that the latter, based on the consolidated results of TIM Celular after the said merger, estimates that the taxable income will be sufficient to use the said deferred credits. On September 30, 2018 the Company recorded total deferred tax assets of R$952,368 arising from amounts that may be used as tax losses (R$702,619) and the negative base of social contribution on income (R$249,749), since all of the factors required for the merger were controlled by Management, such as: (i) the feasibility studies regarding the use of tax benefits was completed and approved by the Company’s governance bodies, as provided for in CVM 371/02; (ii) definition of the actual corporate restructuring schedule upon the merger; (iii) obtaining of approvals and/or consent of third parties (ANATEL and BNDES) by the Company, among other factors. Due to the final unappealable decision issued by the Higher Courts in favor of TIM Celular S.A. (absorbed by TIM S.A.) in the action that discussed the exclusion of the ICMS from the base of calculation of PIS and COFINS contributions, a tax credit of R$2,875.5 million (R$ 2,862.7 million in December 31, 2019), including the principal amount and monetary adjustments, was recognized in the accounts in June 2019. In September 2019, due to a final unappealable decision and calculation of amounts, the amount of R$148 million (R$ 149 million in December 31, 2019), was recorded relating to TIM S.A. For purposes of IRPJ and CSLL taxation, the Company’s management, supported by the legal opinions of external counsels, decided to defer it until the moment that the credit is financially available. Thus, a deferred tax liability was recorded regarding the full amount of R$1,039.7 million. Expectation of recovery of tax credits The estimates regarding the recovery of tax assets were calculated taking into account the financial and business assumptions available at the close of the tax year of 2019. Based on these projections, the Company expects to recover the credits as follows: Deferred income tax and social contribution 2020 229,151 2021 275,425 2022 296,135 2023 - Tax losses and negative base 800,711 Temporary differences (848,445) Total (47,734) The subsidiary has set up deferred income and social contribution tax credits on its total tax losses, negative basis of social contribution and temporary differences, based on the history of profitability and projected future taxable earnings. The subsidiary used credits related to tax losses carried forward and the negative basis of social contribution in the amount of R$91,731 for the period ended December 31, 2019 (R$85,812 on December 31, 2018). Unrecognized deferred tax assets Considering that TIM Participações S.A. does not carry out activities that could generate taxable profits, deferred tax credits arising from income tax and social contribution tax losses and temporary differences, totaling R$125,876 as at December 31, 2019 (R$107,092 on December 31, 2018) were not recognized. |
11. Prepaid expenses
11. Prepaid expenses | 12 Months Ended |
Dec. 31, 2019 | |
Prepaid Expenses [Abstract] | |
Prepaid expenses | 11. Prepaid expenses 2019 2018 245,524 346,441 Advertising not released (1) 854 76,651 Rentals and insurance 75,809 78,005 Network Swap (2) - 11,449 Incremental costs for obtaining customer contracts (3) 158,093 173,056 Others 10,768 7,280 Current portion (175,868) (272,060) Non-current portion 69,656 74,381 (1) Represents the early payment of expenses from the advertising of TIM brand’s products and services, which were recognized in income for the period during which the advertising was broadcast. (2) On April 1, 2010, the subsidiary TIM S.A. and GVT entered into an onerous contract and a reciprocal agreement for the assignment of fiber optic infrastructure (network swap), in order to expand their respective areas of operation. Given the economic nature of the transaction, the amount was recognized in the (current and non-current) prepaid expenses and deferred revenue (current and non-current) and is amortized to income according to the contract’s term. This contract is within the scope of IFRS 16. Therefore, it was reclassified to right-of-use in leases under property, plant and equipment, as shown in Note 2.f. (3) This is mainly represented by incremental costs related to sales commissions paid to sales agents in order to obtain customer contracts arising from the adoption of IFRS 15, which are deferred to income according to the term and/or economic benefit of the contract, which is usually two years. |
12. Judicial deposits
12. Judicial deposits | 12 Months Ended |
Dec. 31, 2019 | |
Judicial Deposits [Abstract] | |
Judicial deposits | 12. Judicial deposits These are recorded at their historical costs and updated according to the legislation in force: 2019 2018 1,006,899 1,345,113 Civil 355,093 334,028 Labor 245,928 492,000 Tributary 203,110 299,310 Regulatory 111 111 Online attachment (*) 202,657 219,664 (*) Refers to blocked judicial deposits directly on the Company´s bank accounts and financial investments related to certain judicial proceedings. This amount is analyzed periodically and, when identified, is reclassified to one of the other specific accounts of judicial deposits. Civil These are court deposits to guarantee the execution of civil proceedings where the Company is challenging the amounts involved. Most of these proceedings refer to lawsuits filed by customers, involving issues of consumer rights, among others. There are some legal proceedings challenging the amounts fixed by ANATEL to leave certain transmission sub-bands to allow the implementation of 4G technology. In this case, the updated court deposit amounted to R$69,326 (R$66,700 as at December 31, 2018). Labor These are amounts deposited in court as guarantees for the execution and the filing of appropriate appeals, where the relevant matters or amounts involved are still being discussed. The total amount has been allocated between the various claims filed by registered employees and third-party service providers. The reduction is substantially due to the closure of several court cases offset by the corresponding court deposits. Tax The Company and its subsidiary have made court deposits related to various current tax court proceedings. These deposits refer mainly to the following matters: (i) Use of credit for the purchase of electricity used directly by the companies for production purposes. The court is likely to give a favorable judgment. The current value of these deposits is R$73,326 (R$74,358 as at December 31, 2018). (ii) Liability for CPMF on the Company’s capitalization of loans; recognition of the right not to pay contributions allegedly due on mere changes in the ownership of current accounts as a result of a takeover. The current value of these deposits is R$10,342 (R$10,026 as at December 31, 2018). (iii) Constitutionality of the collection of the Operations Monitoring Charge (“TFF”) by a number of municipal authorities. The current value of these deposits is R$18,401 (R$16,719 as at December 31, 2018). (iv) Failure to approve the offsetting of federal debts against credits for withholding tax (“IRRF”) because it is alleged that the credits are insufficient, as well as the deposit placed to ensure the issue of a Tax Clearance Certificate. The current value of these deposits is R$11,173 (R$10,868 as at December 31, 2018). (v) Liability for ISS (Tax on Services) on import services and outsourced services; alleged failure to pay for land clearance and Base Transceiver Station (“BTS”) maintenance services, for ISS on the Company’s services and for ISS on co-billing services and software licensing (Blackberry). The Company´s right is to take advantage of the benefit of spontaneous declaration in order to reverse confiscatory fines for late payment. The current value of these deposits is R$7,878 (R$7,519 as at December 31, 2018). (vi) Ancillary services provided for in ICMS Agreement 69/98 related to ICMS levied on amounts related to communications services charged for access, subscription, activation, habilitation availability, subscription and use of services, among others. The current value of these deposits is R$3,457 (R$4,793 as at December 31, 2018). (vii) Requirement by ANATEL of the Public Price Referring to the Administration of Numbering Resources. The current value of these deposits is R$3,471 (R$3,380 as at December 31, 2018). (viii) Deposit made by TIM S.A. related to the unconstitutionality and illegality of charging by the Telecommunications Services Universalization Fund (“FUST”). Plea for the recognition of the right not to pay FUST, and not to include in its calculation base interconnection and Industrial Exploration of Dedicated Line (“EILD”) revenue, as well as for the right not to be charged retroactively for differences arising from failure to comply with ANATEL Ruling 7/2005. The current value of these deposits is R$57,943 (R$56,088 as at December 31, 2018). |
13. Property, plant and equipme
13. Property, plant and equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, plant and equipment [abstract] | |
Property, plant and equipment | 13 Property, plant and equipment Property, plant and equipment are stated at acquisition and/or construction cost, less accumulated depreciation and impairment losses (the latter only if applicable). Depreciation is calculated based on the straight-line method over terms that take into account the expected useful lives of the assets and their residual values. At December 31, 2019 and 2018 the Company has no indication of impairment in its fixed assets. The estimated costs of dismantling towers and equipment on rented properties are capitalized and depreciated over the estimated useful lives of these assets. The Company recognizes the present value of these costs in property, plant and equipment with a counter-entry to the liability “provision for future asset retirement”. Interest incurred on updating the provision is classified within financial expenses. Gains and losses on disposal are determined by comparing the amounts of these disposals with the carrying values at the time of the transaction and are recognized in “other operating expenses (revenue), net” in the statement of income. (a) Changes in property, plant and equipment Balance for Dec/18 Adoption of IFRS 16 Additions Disposals Transfers Other changes (*) Balance for Dec/19 Total cost of property, plant and equipment, gross 33,832,803 5,256,114 4,855,684 (183,384) - (408,118) 43,353,099 Commutation/transmission equipment 20,806,249 - 17,662 (133,789) 2,121,907 - 22,812,029 Fiber optic cables 762,175 - - - 51,414 - 813,589 Leased handsets 2,313,945 - 519 (20,194) 195,725 - 2,489,995 Infrastructure (i) 6,133,810 - - (18,684) 294,851 (313,130) 6,096,847 Informatics assets 1,679,328 - - (9,366) 51,289 - 1,721,251 General use assets 796,839 - - (623) 63,289 - 859,505 Rights-of-use in leases (ii) (Note 2.f) - 5,256,114 1,772,290 - - (94,988) 6,933,416 Land 40,794 - - - - - 40,794 Construction in progress 1,299,663 - 3,065,213 (728) (2,778,475) - 1,585,673 Total of Accumulated depreciation (22,629,181) - (3,262,726) 150,972 - - (25,740,935) Commutation/transmission equipment (14,936,069) - (1,577,490) 129,998 - - (16,383,561) Fiber optic cables (345,532) - (65,035) - - - (410,567) Leased handsets (2,132,227) - (131,341) 6,705 - - (2,256,863) Infrastructure (i) (3,157,890) - (440,224) 4,281 - - (3,593,833) Informatics assets (1,512,114) - (62,561) 9,366 - - (1,565,309) General use assets (545,349) - (45,931) 622 - - (590,658) Right-of-use in leases (ii) (Note 2.f) - - (940,144) - - - (940,144) Total property, plant and equipment, net 11,203,622 5,256,114 1,592,958 (32,412) - (408,118) 17,612,164 Commutation/transmission equipment 5,870,180 - (1,559,828) (3,791) 2,121,907 - 6,428,468 Fiber optic cables 416,643 - (65,035) - 51,414 - 403,022 Leased handsets 181,718 - (130,822) (13,489) 195,725 - 233,132 Infrastructure (i) 2,975,920 - (440,224) (14,403) 294,851 (313,130) 2,503,014 Informatics assets 167,214 - (62,561) - 51,289 - 155,942 General use assets 251,490 - (45,931) (1) 63,289 - 268,847 Rights-of-use in leases (ii) (Note 2.f) - 5,256,114 832,146 - - (94,988) 5,993,272 Land 40,794 - - - - - 40,794 Construction in progress 1,299,663 - 3,065,213 (728) (2,778,475) - 1,585,673 Balance for Dec/17 Additions/ Depreciation Disposals Transfers Balance for Dec/18 Total cost of property, plant and equipment, gross 31,166,905 2,746,039 (80,141) - 33,832,803 Commutation/transmission equipment 18,766,840 8,974 (48,203) 2,078,638 20,806,249 Fiber optic cables 683,971 20 - 78,184 762,175 Leased handsets 2,181,630 - (15,675) 147,990 2,313,945 Infrastructure 5,652,840 678 (4,562) 484,854 6,133,810 Informatics assets 1,615,325 9 (9,511) 73,505 1,679,328 General use assets 739,439 286 (2,018) 59,132 796,839 Land 40,794 - - - 40,794 Construction in progress 1,486,066 2,736,072 (172) (2,922,303) 1,299,663 - Total Accumulated depreciation (20,328,417) (2,371,362) 70,598 - (22,629,181) Commutation/transmission equipment (13,373,003) (1,610,326) 47,260 - (14,936,069) Fiber optic cables (290,699) (54,833) - - (345,532) Leased handsets (2,016,018) (124,709) 8,500 - (2,132,227) Infrastructure (2,697,878) (463,856) 3,844 - (3,157,890) Informatics assets (1,448,694) (72,885) 9,465 - (1,512,114) General use assets (502,125) (44,753) 1,529 - (545,349) Total property, plant and equipment, net 10,838,488 374,677 (9,543) - 11,203,622 Commutation/transmission equipment 5,393,837 (1,601,352) (943) 2,078,638 5,870,180 Fiber optic cables 393,272 (54,813) - 78,184 416,643 Leased handsets 165,612 (124,709) (7,175) 147,990 181,718 Infrastructure 2,954,962 (463,178) (718) 484,854 2,975,920 Informatics assets 166,631 (72,876) (46) 73,505 167,214 General use assets 237,314 (44,467) (489) 59,132 251,490 Land 40,794 - - - 40,794 Construction in progress 1,486,066 2,736,072 (172) (2,922,303) 1,299,663 The construction in progress represent the cost of projects in progress related to the construction of networks and/or other tangible assets in the period of their construction and installation, until the moment they come into operation, when they will be transferred to the corresponding accounts of these assets. (*) Other changes include: (i) In 2019, the "Sale of Towers (leaseback)" lease had its value remeasured for better alignment with the methodology of the new IFRS 16, based on paragraph C11 of this new pronouncement and removed the projected inflation component on future receipts, in the amount of R$ 313,130. (ii) In the fourth quarter of 2019, the Company implemented a new tool that allowed Management to control and calculate in an automated manner the accounting effects arising from lease agreements. Through this new tool, it was possible to identify adjustments in the amount of R$94,988 of these assets (note 2). Lease operation - network Lease operation - vehicles Lease operation – Stores & kiosks Lease operation - Property Lease operation – Land (Network) Total Balances as at January 01, 2019 2,625,145 6,792 375,286 1,540,685 708,206 5,256,114 Additions in the period, net of cancellation 928,682 5,045 191,597 322,067 324,899 1,772,290 Remensuration 5,841 (500) 5,895 (138,967) 32,743 (94,988) Depreciation (387,526) (4,349) (93,306) (183,872) (271,091) (940,144) Balances as at December 31, 2019 3,172,142 6,988 479,472 1,539,913 794,757 5,993,272 Useful Life - % 10.98 44.81 21.04 11.97 31.25 In the fourth quarter of 2019, the Company implemented a new tool that allowed Management to control and calculate in an automated manner the accounting effects arising from lease agreements. Therefore, this new tool allowed Management to make individualized calculations, both in relation to the measurement of the effects of assets and liabilities of leases, and also in relation to the monthly calculation of depreciation and interest that affect the result, which prior to the implementation of this new tool were made considering an average depreciation term and discount rate for each asset class (for example: land and infrastructure sharing). Therefore, through this new tool, it was possible to re-measure the depreciation and amortization accounts, financial income (expenses) and, consequently, income tax and social contribution resulting from the individualized calculations that were made. (b) Depreciation rates Annual Rate % Commutation/transmission equipment 8 to 14.29 Fiber optic cables 4 to 10 Leased assets 14.28 to 50 Infrastructure 4 to 20 Informatic assets 10 to 20 General use assets 10 to 20 In 2019, pursuant to IAS 16, approved by a CVM Deliberation, the Company and its subsidiaries assessed the useful life estimates for their property, plant and equipment, concluding that there were no significant changes or alterations to the circumstances on which the estimates were based that would justify changes to the useful lives currently in use. |
14. Intangible assets
14. Intangible assets | 12 Months Ended |
Dec. 31, 2019 | |
Intangible assets and goodwill [abstract] | |
Intangible assets | 14. Intangible assets Intangible assets are measured at historical cost less accumulated amortization and impairment losses (if applicable) and reflect: (i) the purchase of authorizations and rights to use radio frequency bands, and (ii) software in use and/or development. Intangibles also include: (i) the purchase of the right to use the infrastructure of other companies, and (ii) goodwill on expectation of future profits in purchases of companies. Amortization charges are calculated using the straight-line method over the estimated useful life of the assets contracted and over the terms of the authorizations. The useful life estimates of intangible assets are reviewed regularly. Any financial charges on funds raised (that is, without a specific destination) and used to obtain a qualifying asset, meaning an asset that requires a significant time to be ready for use, are capitalized as a portion of the cost of the asset when it is likely to bring future economic benefits to the entity and such costs can be accurately measured. These costs are amortized throughout the estimated useful lives of the assets. As at December 31, 2019 and 2018, the Company has no indication of impairment in its intangible assets of defined and indefinite useful life. The amounts of the SMP authorizations and rights to use radio frequencies, as well as software, goodwill and other items, were recorded as follows: (a) Changes in intangibles Balance for Dec/18 Additions/ Amortization Transfers Other Changes (g) Balance for Dec/19 Total cost of intangible assets, gross 29,366,779 961,213 - (98,633) 30,229,359 Right to use software 17,142,641 - 1,041,741 - 18,184,382 Authorizations 7,638,970 26,968 2,255,625 (109,770) 9,811,793 Goodwill 1,527,219 - - - 1,527,219 Right to use infrastructure - LT Amazonas 198,202 - - (28,874) 169,328 Other assets 307,654 - 19,708 - 327,362 Intangible assets under development 2,552,093 934,245 (3,317,074) 40,011 209,275 Accumulated amortization (18,684,775) (1,876,258) - - (20,561,033) Right to use software (13,681,086) (1,412,080) - - (15,093,166) Authorizations (4,845,642) (432,771) - - (5,278,413) Right to use infrastructure - LT Amazonas (52,441) (7,763) - - (60,204) Other assets (105,606) (23,644) - - (129,250) Total intangible assets, net 10,682,004 (915,045) - (98,633) 9,668,326 Right to use software (c) 3,461,555 (1,412,080) 1,041,741 - 3,091,216 Authorizations 2,793,328 (405,803) 2,255,625 (109,770) 4,533,380 Goodwill (d) 1,527,219 - - - 1,527,219 Right to use infrastructure - LT Amazonas (e) 145,761 (7,763) - (28,874) 109,124 Other assets 202,048 (23,644) 19,708 - 198,112 Intangible assets under development (f) 2,552,093 934,245 (3,317,074) 40,011 209,275 Balance Dec/17 Additions/ Amortization Transfers Disposals Capitalized interest Balance for Dec/18 Total cost of intangible assets, gross 28,549,552 1,139,993 (479,811) (1,270) 158,315 29,366,779 Right to use software 15,957,808 - 1,186,103 (1,270) - 17,142,641 Authorizations 6,391,394 94,148 1,153,428 - - 7,638,970 Goodwill 1,527,219 - - - - 1,527,219 Costs with commissions to deferred sales representatives 384,455 - (384,455) - - - List of clients 95,200 - (95,200) - - - Right to use infrastructure - LT Amazonas 198,202 - - - - 198,202 Other assets 270,687 - 36,967 - - 307,654 Intangible assets under development 3,724,587 1,045,845 (2,376,654) - 158,315 2,552,093 Accumulated amortization (17,237,025) (1,799,914) 350,894 1,270 - (18,684,775) Right to use software (12,265,391) (1,416,965) - 1,270 - (13,681,086) Authorizations (4,497,758) (347,884) - - - (4,845,642) Costs with commissions to deferred sales representatives (255,694) - 255,694 - - - List of clients (95,200) 95,200 - - - Right to use infrastructure - LT Amazonas (42,531) (9,910) - - - (52,441) Other assets (80,451) (25,155) - - - (105,606) Total intangible assets, net 11,312,527 (659,921) (128,917) - 158,315 10,682,004 Right to use software (c) 3,692,417 (1,416,965) 1,186,103 - - 3,461,555 Authorizations 1,893,636 (253,736) 1,153,428 - - 2,793,328 Goodwill (d) 1,527,219 - - - - 1,527,219 Costs with commissions to deferred sales representatives (Note 11.3) 128,761 - (128,761) - - - Right to use infrastructure - LT Amazonas (e) 155,671 (9,910) - - - 145,761 Other assets 190,236 (25,155) 36,967 - - 202,048 Intangible assets under development (f) 3,724,587 1,045,845 (2,376,654) - 158,315 2,552,093 Intangible assets under development represents the cost of projects in progress related to the acquisition of 4G authorizations and/or other intangible assets during the period of their construction and installation, up to the moment when they enter into operation, where they will be transferred to the corresponding accounts for these assets. In addition, these intangible assets were assessed for impairment as at December 31, 2019 and 2018, with no necessary adjustment. (b) Amortization rates Annual rate % Right to use software 20 Authorizations 5 to 50 Right to use infrastructure 5 Other assets 7 to 10 (c) Right to use software The costs associated with maintaining software are recognized as expenses as they are incurred. Identifiable and unique development costs that are directly attributable to the design and testing of software products controlled by the Group are recognized as intangible assets when all capitalization criteria are met. Directly attributable costs, which are capitalized as part of the software product, include costs for employees directly allocated to its development. (d) Goodwill from previous years The Company and its subsidiary have the following goodwill based on expectations of future profitability as at December 31, 2019 and 2018: Goodwill on acquisition of TIM S.A Goodwill from TIM Fiber SP and TIM Fiber RJ acquisitions TIM Fiber SP Ltda. and TIM Fiber RJ. S.A. were merged into the subsidiary TIM S.A. on August 29, 2012. The subsidiary recorded the goodwill allocation related to the purchase of the companies TIM Fiber SP and TIM Fiber RJ, at the end of the purchase price allocation process, in the amount of R$1,159,648. Goodwill from the acquisition of minority interests in TIM Sul and TIM Nordeste Impairment test As required by the accounting standards, the Company tests goodwill on business combinations involving TIM Group companies annually for impairment, and the methods and assumptions used by Management in the impairment testing of goodwill mentioned above are summarized below: The Company’s Management understands that the smaller cash generating units, for the purposes of testing the impairment of goodwill on the purchase of the aforementioned companies, refer to the business at a consolidated level, and therefore should be assessed at the level of TIM Participações. This methodology is aligned with the strategic direction of the Company and its subsidiary. In 2019 the impairment test was performed comparing the carrying amount with the fair value less the costs of disposal of the asset, as provided in IAS 36. The fair value calculation considered the hierarchy level within which the fair value measurement of the asset (cash generating unit) is classified. For TIM Participações as there is only one CGU this was classified in its entirety as Level 1, for the disposal costs we consider that it is irrelevant considering the variation between the fair value level 1 and the carrying amount of the cash generating unit. The fair value of Level 1 instruments comprises instruments traded in active markets and based on quoted market prices at the balance sheet date. A market is viewed as active if quoted prices are readily and regularly available from an exchange, distributor, broker, industry group, pricing service or regulatory agency, and those prices represent actual and regularly occurring market transactions on a purely commercial basis. In the case of TIM Participações, its securities are traded on BOVESPA with a code (TIMP3) and have a regular trading volume that allows the measurement (Level 1) as the product between the quoted price for the individual asset or liability and the quantity held by the entity. The measurement was made based on the share value on the balance sheet date and sensitivity tests were also performed and in none of the scenarios was identified any indication of impairment, with the fair value being higher than the carrying amount. Therefore, as the fair value is higher than the carrying amount, it is not necessary to calculate the value in use. (e) Infrastructure use rights - LT Amazonas The subsidiary signed agreements for the right to use the infrastructure of companies that operate electric power transmission lines in Northern Brazil. Such agreements fell within the scope of IFRIC 4 and are classified as financial leases. Additionally, the subsidiary entered into network infrastructure sharing contracts with Telefônica Brasil S.A. also in the Northern region. In these contracts, both operators optimize resources and reduce their operational costs (Note 15). (f) Auction and payment of 4G License 700 MHz In 2018 the Intangible assets in progress are substantially represented by costs for the development of 4G technology, which included: (i) amounts paid to obtain 4G Licenses; (ii) costs for cleaning the 700 MHZ frequency band; and (iii) financial costs capitalized on qualifiable assets, as detailed below: (i) On September 30, 2014, the subsidiary purchased Lot 2 in the Auction of the 700 MHz band in the amount of R$1,739 million. In December 2014, the Company made the payment of R$ 1,678 million, recording the remaining balance payable in the amount of R$ 61 million as a liability (note 18), as provided for in the announcement. The subsidiary is challenging the remaining balance with Anatel, which is subject to interest rates of 1% p.m. and monetary adjustment at the IGP-DI. These amounts are capitalized by the Company. The impact for the tax year ended December 31, 2019 was R$1,636 (R$5,611 on December 31, 2018) of interest and R$735 (R$5,930 on December 31, 2018) of monetary adjustments. (ii) Additionally, as determined in the call notice, the Company has borne the costs for the cleaning of the frequency band purchased. The nominal amount due from the Company in relation to the cleaning of the 700 MHZ frequency of the lot purchased was R$904 million. The Company also had an additional cost of R$295 million related to the portion that has not been bought in the auction, and that was subsequently split by ANATEL among the companies that won the auction, totaling R$1,199 million. In order to perform the spectrum cleaning activities, in March 2015 TIM, together with other companies that won the auction, have constituted a Redistribution and Digitalization Management Entity for TV and RTV Channels, named “ Entidade Administradora da Digitalização" The Company made the payments as at April 9, 2015, January 26, 2017 and January 16, 2018 in the amounts of R$370,379, R$858,991 and R$142,862, respectively. The license mentioned above relates to the concept of a qualifying asset. Consequently, the finance charges on funds raised without a specific destination, used for the purpose of obtaining a qualifying asset, are capitalized at the average rate of 6.90 % per annum in connection with the borrowing and financing in force during the tax year. The amount capitalized during the tax year ended December 31, 2019 was R$38,375 (R$152,480 as at December 31, 2018). In September 2019, the assets were considered in operation by Management and from this date on, the capitalization of interest and charges on this asset was closed (g) Other changes “Other changes” include: (i) the remeasurement of amounts of authorizations in accordance with Anatel Resolution 695/18 in the amount of R$109,770; (ii) interest capitalized as a result of the acquisition of the 4G license, in accordance with IAS 23 in the amount of R$40,011, since the respective license is an asset that qualifies for interest capitalization. (iii) In 2019, the item "Right to use infrastructure - LT Amazonas", had its value remeasured for better alignment with the methodology of the new IFRS 16, removing the projected inflation component on future receipts, in the amount of R$28,874. |
15. Financiale leases
15. Financiale leases | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of financial assets [abstract] | |
Financiale leases | 15 Financiale leases Leases in which the Company, as the lessee, substantially holds all of the risks and benefits of ownership, are classified as financial leases, which are capitalized at the beginning of the lease at the lower of the fair value of the leased item and the present value of the payments provided for in the agreement. Interest related to the leases is taken to income as financial costs over the term of the contract. The subsidiary entered into tower lease agreements, as a lessee, arising from a sale and financial leaseback operation involving the sale of an asset and the concomitant lease of the same asset by the purchaser to the seller. The subsidiary recognized a liability corresponding to the present value of the compulsory minimum installments under the agreement. Leases in which the Company, as lessor, substantially transfers the risks and benefits of the ownership to the other party (the lessee) are classified as financial leases. These lease values are transferred from the intangible assets of the Company and are recognized as a lease receivable at the lower of the fair value of the leased item and/or the present value of the receipts provided for in the agreement. Interest related to the lease is taken to income as financial income over the contractual term. Asset leases are financial assets registered and/or measured at amortized cost. Assets 2019 2018 LT Amazonas 156,378 208,049 156,378 208,049 Current portion (4,931) (22,491) Non-current portion 151,447 185,558 LT Amazonas As a result of the agreement entered into with LT Amazonas, the subsidiary entered into network infrastructure sharing agreements with Telefônica Brasil S.A. Under these agreements, the subsidiary and Telefônica Brasil S.A. make joint investments in the Northern region of Brazil. The subsidiary has receivables against Telefônica Brasil S.A. that have to be paid on a monthly basis for a period of 20 years. These amounts are annually restated by IPC-A (Price Index Rate). The consolidated nominal amount of future installments receivable by the subsidiary is R$316,641 (R$499,823 on December 31, 2018). The table below includes the schedule of cash receipts for the agreement currently in force. The amounts represent the cash receipts estimated in the signed agreements and are stated at their nominal amounts. It is worthwhile noting that these balances differ from those shown in the books since, in the case of the latter, the amounts are shown at their present value: Nominal amount Present Value January 2020 to December 2020 23,206 4,931 January 2021 to December 2024 92,826 58,081 January 2025 onwards 200,609 93,366 316,641 156,378 The present value of installments receivable is R$156,378 (R$208,049 as at December 31, 2018), consisting entirely of principal and estimated as at the date of execution of agreements entered into with the transmission companies, projecting future cash receipts discounted at 12.56% per annum. In 2019, its value was reassessed to better align it with the methodology of the new standard IFRS 16, removing the component of projected inflation on future income, in the amount of R$ 48,991. Regarding the values present in the leases, this is represented by the principal amount without any projection of financial charges. Liabilities 2019 2018 LT Amazonas (i) 276,233 359,987 Sale of towers ( leaseback 1,192,596 1,501,695 Other (iv) 115,973 78,392 Subtotal 1,584,802 1,940,074 Other lease operations (Note 2.f) and (iii): - Lease– Network 3,294,261 - Lease – Vehicles 3,005 - Lease – Stores and kiosks 255,857 - Lease - Properties 243,921 - Lease - Land (network) 1,600,456 - Lease – Fiber 798,568 - Subtotal (IFRS 16) 6,196,068 - Total 7,780,870 1,940,074 Current portion (873,068) (205,048) Non-current portion 6,907,802 1,735,026 Interest paid in the period ended December 31, 2019 regarding IFRS16 amounted to R$592,323. Changes to the financial liabilities of lease operations are shown in Note 36. i) LT Amazonas The subsidiary executed agreements for the right to use the infrastructure of companies that operate electric power transmission lines in Northern Brazil (“LT Amazonas”). The terms of these agreements are for 20 years, counted from the date on which the assets are ready to operate. The contracts provide for monthly payments to the electric power transmission companies, restated annually at the IPCA. The table below presents the future payment schedule for the agreements in force. These amounts represent the estimated disbursements under the agreements executed with distributors and are shown at their nominal amounts. These balances differ from those shown in the books since, in the case of the latter, the amounts are shown at present value: Nominal amount Present value January 2020 to December 2020 44,079 8,451 January 2021 to December 2024 176,315 103,464 January 2025 onwards 381,161 164,318 601,555 276,233 The consolidated nominal value of future installments due from the Company is R$601,555. Its present value is R$276,233, composed entirely of principal and was estimated on the date on which the agreements were signed with the transmission companies by projecting the future payments and discounting these at 14.44% per annum. Additionally, the right to use balance of LT Amazonas also includes R$70,759 related to investments in property, plant and equipment made by the Company and subsequently donated to the electric power transmission companies. These donations are already included in the contract signed by the parties. In 2019, its value was reassessed according to the IFRS 16 calculation methodology, removing the component of projected inflation on future payments and maintaining the original discount rate for calculating present value. Regarding the values present in the leases, this is represented by the principal amount without any projection of financial charges. ii) Sale and leaseback of Towers The subsidiary entered into two Sales Agreements with American Tower do Brasil Cessão de Infraestruturas Ltda. (“ATC”) in November 2014 and January 2015 for up to 6,481 telecommunications towers then owned by TIM Celular, for an amount of approximately R$3 billion, and a Master Lease Agreement (“MLA”) for part of the space on these towers for a period of 20 years from the date of transfer of each tower, under a sale and leaseback transaction, with a provision for monthly rental amounts depending on the type of tower (greenfield or rooftop). The sales agreements provide for the towers to be transferred in tranches to ATC, due to the need to meet certain conditions precedent. In total, 5,873 transfers of towers occurred, being 54, 336 and 5,483 in the years 2017, 2016 and 2015, respectively. This transaction resulted in a sales amount of R$2,651,247, of which R$1,088,390 was booked as deferred revenue and will be amortized over the period of the contract (Note 22). The discount rate used in the transaction was determined on the basis of observable market transactions that the Company (the lessee) would have to pay under a similar lease or loan, as mentioned below. The table below includes the schedule of payments of the agreement in force in relation to the MLA. The amounts represent the disbursements estimated in the agreement signed with ATC, stated at their nominal amounts. It should be noted that these balances differ from those shown in the books since, in the case of the latter, the amounts are shown at their present values: Nominal amount Present value January 2020 to December 2020 187,720 32,734 January 2021 to December 2024 750,881 449,470 January 2025 onwards 1,991,762 710,392 2,930,363 1,192,596 The consolidated nominal amount of the sum of future installments payable by the subsidiary is R$2,930,363. The present value is R$1,192,596, consisting entirely of principal. The present value was estimated by projecting future payments discounted at the discount rates used on the transaction date, ranging from 11.01% to 17.08% per annum, and which were determined on the basis of observable market transactions that the Company (the lessee) would have to pay under a similar lease and/or loan. In 2019, its value was reassessed according to the IFRS 16 calculation methodology, removing the component of projected inflation on future payments and maintaining the original discount rate for calculating present value. Regarding the values present in the leases, this is represented by the principal amount without any projection of financial charges. (iii) Other lease operations In addition to the lease operations mentioned above, the Company also has lease agreements that qualify within the scope of IFRS16. The following table shows the payment schedule of those agreements in effect. The amounts represent the estimated disbursements within the agreements signed and are shown at their face value. The balances differ from those shown in the books, since in the latter case the amounts are shown at present value: Up to December 2020 January 2021 to December 2024 January 2025 onwards Nominal amount Present values Total other lease operations 1,388,262 4,284,210 3,617,001 9,289,474 6,196,068 Lease operation - network 623,670 2,291,331 2,059,339 4.974341 3,294,261 Lease operation - vehicles 5,039 2,848 - 7,886 3,005 Lease operation – Stores & kiosks 82,958 174,338 52,426 309,721 255,857 Lease operation - Property 51,317 176,575 156,560 384,452 243,921 Lease operation – Land (Network) 298,389 1,035,594 1,348,676 2,682,660 1,600,456 Lease operation – Fiber 326,889 603,524 - 930,414 798,568 The present value, principal and interest as at December 31, 2019 for the agreements above, was estimated on a monthly basis, based on the average incremental rate of the Company’s loans, namely 10.55%. Lease amounts considered low, or lower than 12 months, recognized in rental expenses amounted to R$82,110 on December 31, 2019. (iv) Substantially represented by the financial leases of transmission towers. |
16. Regulatory credits recovera
16. Regulatory credits recoverable | 12 Months Ended |
Dec. 31, 2019 | |
Regulatory Credits Recoverable [Abstract] | |
Regulatory credits recoverable | 16. Regulatory credits recoverable These refer to Fistel credit amounts arising from the reduction of the client base, which may be offset by future changes in the base, or used to reduce future obligations, and are expected to be used toward settlement of the TFF payable to Fistel annually in the month of March. On December 31, 2019 this credit are up to R$ 33,090 (R$ 41,612 on December 31, 2018). |
17. Suppliers
17. Suppliers | 12 Months Ended |
Dec. 31, 2019 | |
Suppliers [Abstract] | |
Suppliers | 17. Suppliers Supplier accounts payable are obligations to pay for goods or services that were purchased in the normal course of business. They are initially recognized at fair value and subsequently measured at amortized cost using the effective interest rate method. Given the short maturity terms of these obligations, in practice they are usually recognized at the invoice value. 2019 2018 3,923,035 4,323,374 Local currency 3,769,298 4,158,599 Suppliers of materials and services (a) 3,667,152 4,027,092 Interconnection (b) 67,396 98,060 Roaming (c) 441 162 Co-billing (d) 34,309 33,285 Foreign currency 153,737 164,775 Suppliers of materials and services (a) 116,057 137,397 Roaming (c) 37,680 27,378 Current portion 3,923,035 4,323,374 (a) Represent the amounts to be paid to suppliers for acquisitions of materials and for the provision of services relating to tangible and intangible assets or for consumption in operations, maintenance and management, as provided for in the agreement between the parties. (b) This refers to the use of the networks of other landline and mobile telephone operators, with calls being initiated from TIM’s network and ending on the networks of other operators. (c) This refers to calls made by customers outside their registration area, who are therefore considered visitors to other operator networks. (d) This refers to calls made by a customer who has used another long-distance operator. |
18. Authorizations payable
18. Authorizations payable | 12 Months Ended |
Dec. 31, 2019 | |
Authorizations Payable [Abstract] | |
Authorizations payable | 18. Authorizations payable As at December 31, 2019, the Company and its subsidiary had the following commitments to ANATEL: 2019 2018 Renewal of authorizations (i) 199,363 300,253 Updated ANATEL liability (ii) 126,974 113,547 326,337 413,800 Current portion (88,614) (65,464) Non-current portion 237,723 348,336 (i) In order to provide SMP services, the company obtained radio frequency authorizations for a fixed period, renewable for a further 15 years. The extension of the right-of-use includes the payment of 2% of the net revenue recorded in the regions covered by the authorization that ends every two years. As at December 31, 2019, the subsidiary had balance due related to the renewal of authorizations in the amount of R$199,363 (R$300,253 as at December 31, 2018). (ii) On December 05, 2014 the subsidiary signed an Authorization Instrument for the 700 MHz band and paid an amount equivalent to R$1,678 million, recording the remaining balance of R$61 million as a trade liability, according to the payment method provided for in the call notice. Due to the absence of bids for some lots in the Call Notice for the 700 MHZ band, the subsidiary, along with other bidders, had to bear a proportion of the costs of these lots. Thus, the EAD was organized, with respect to which the total commitment assumed by the subsidiary was R$1,199 million. This amount was paid in four installments adjusted by the IGP-DI (Daily General Price Index) (Note 14.f). As at June 30, 2015, the subsidiary filed a lawsuit challenging a surplus charge of R$61 million (R$127 million as at December 31, 2019), which is still pending trial. The authorizations held on a primary basis by TIM S.A. as at December 31, 2019, as well as their maturity dates, are detailed below: Maturity date Authorization instruments 450 MHz 800 MHz, 900 MHz and 1,800 MHz Additional frequencies 1,800 MHz 1,900 MHz and 2,100 MHz (3G) 2,500 MHz V1 Band (4G) 2,500 MHz (P** Band (4G) 700 MHz (4G) Amapá, Roraima, Pará, Amazonas and Maranhão - March, 2031* April, 2023 April, 2023 October, 2027 Part of AR92 (PA) – February, 2024* December, 2029 Rio de Janeiro and Espírito Santo October, 2027 March, 2031* ES - April, 2023 April, 2023 October, 2027 Part of AR21 (RJ) – February, 2024* December, 2029 Acre, Rondônia, Mato Grosso, Mato Grosso do Sul, Tocantins, Distrito Federal, Goiás, Rio Grande do Sul (except the municipality of Pelotas and region) and the municipalities of Londrina and Tamarana, in Paraná PR - October, 2027 March, 2031* April, 2023 April, 2023 October, 2027 Part of AR61 (DF) – February, 2024* December, 2029 São Paulo - March, 2031* Countryside - April, 2023 April, 2023 October, 2027 - December, 2029 Paraná (except the municipalities of Londrina and Tamarana) October, 2027 September, 2022* April, 2023 April, 2023 October, 2027 AR41, except Curitiba and Metropolitan Region - February, 2024* AR41, Curitiba and Metropolitan Region - July, 2031 December, 2029 Santa Catarina October, 2027 September, 2023* April, 2023 April, 2023 October, 2027 - December, 2029 Municipality and region of Pelotas, in the State of Rio Grande do Sul - April, 2024* - April, 2023 October, 2027 - December, 2029 Pernambuco - May, 2024* - April, 2023 October, 2027 Part of AR81-July, 2031 December, 2029 Ceará - November, 2023* - April, 2023 October, 2027 - December, 2029 Paraíba - December, 2023* - April, 2023 October, 2027 - December, 2029 Rio Grande do Norte - December, 2023* - April, 2023 October, 2027 - December, 2029 Alagoas - December, 2023* - April, 2023 October, 2027 - December, 2029 Piauí - March, 2024* - April, 2023 October, 2027 - December, 2029 Minas Gerais (except the municipalities of the PGO sector 3 for 3G the radio frequencies and others) - April, 2028* April, 2023 April, 2023 October, 2027 Part of AR31 - February, 2030* December, 2029 Bahia and Sergipe - August, 2027* - April, 2023 October, 2027 - December, 2029 *Agreements already renewed for 15 years, and therefore TIM is not entitled to a further renewal period. ** Only complementary areas in some specific States. |
19. Borrowing and financing
19. Borrowing and financing | 12 Months Ended |
Dec. 31, 2019 | |
Borrowings [abstract] | |
Borrowing and financing | 19. Borrowing and financing These are recorded as financial liabilities measured at amortized cost, being represented by non-derivative financial liabilities that are not usually traded before maturity. They are initially recognized at fair value, and subsequently measured based on the effective interest rate method. The appropriation of financial expenses based on the effective interest rate method is recorded in income, under financial expenses. Description Currency Charges Maturity Dec/2019 Dec/2018 BNDES (1) URTJLP TJLP to TJLP + 2,52 % p.a. Jul/22 240,008 578,312 BNDES (1) UM143 SELIC + 2.52% p.a. Jul/22 374,461 489,421 BNDES (PSI) (1) R$ 3.50% p.a. Jan/21 18,071 56,804 KFW (2) USD Libor 6M+ 1.35% p.a. Apr/19 - 43,420 KFW Finnvera (2) USD Libor 6M+ 0.75% p.a. Jan/24 to Dec/25 330,217 378,595 Debentures (2) R$ 104.1% of the CDI Jul/20 1,025,965 - Cisco Capital (3) USD 2.50% p.a. Dec/20 40,366 116,465 Total 2,029,088 1,663,017 Current (1,384,180) (698,728) Non-current 644,908 964,289 Guarantees: (1) Guaranteed by the holding company TIM Participações and collateral of some receivables of the subsidiary. (2) Guaranteed by the holding company TIM Participações. (3) No guarantee. The financing arranged by the subsidiary with BNDES was raised for the purpose of expanding the mobile phone network. The agreements include covenants that require certain financial and non-financial indexes calculated every six months. The Company, TIM Participações, has complied with these financial ratios. The financial indexes are: (1) Shareholders' equity over total assets; (2) EBITDA over net financial expenses; (3) Total financial debt over EBITDA and (4) Short-term net financial debt over EBITDA. In May 2018, the Company obtained a new line of credit in the amount of R$ 1,500 million from BNDES to finance investments in fixed assets (Capex) for the three-year period 2017-2019 with a term of use up to December 2019. As of March 2019, with the contracting of Finame Direto, the Company replaced the sub-credit "B" of this contract (equivalent to R$ 390 million). This new credit line in the amount of R$ 390 million with Finame, a company of the BNDES system, aimed at improving the conditions of one of the sub-credits, of equal value, contracted with BNDES in May 2018, both in terms of term and cost. The cost of this line is TLP (Long Term Interest Rate) plus interest of up to 1.44% per year and its availability extends until December 2020, without any reimbursement obligations. The table below sets forth the status of the financing and credit facilities available: Type Currency Date of opening Term Total amount Undrawn balance Amount used as at December 31, 2019 Amount expired until December 31, 2019 BNDES (1) TJLP May/18 Dec/19 1,090,000 - - 1,090,000 BNDES (2) TJLP May/18 Dec/19 20,000 - - 20,000 FINAME TLP Mar/19 Dec/20 390,000 390,000 - - Total R$ 1,500,000 390,000 - 1,110,000 Purpose: (i) Support for the TIM investment plan for the years 2017 to 2019 including, but not limited to, the acquisition of Brazilian equipment. (ii) Investment in social projects involving the community. (iii) Investment solely toward the purchase of machinery and equipment, industrial systems and/or other components manufactured in the country. The Investment Sustainment Program (“PSI”) financing lines, obtained from BNDES, refer to specific programs of this institution and have interest rates lower than those used in BNDES’ ordinary operations. The balance as at December 31, 2019, corresponding to the adjustment of the subsidy granted by the BNDES for all the PSI lines, was approximately R$42 million. This amount was recorded in “Deferred revenue” under the “Government subsidies” (Note 22) line and deferred for the useful life of the asset being financed and appropriated to income in “Subsidy income” (Note 28). In January 2019, the Company, through its subsidiary, issued the first simple non-convertible debentures, unsecured, in the amount of R$ 1,000 million. The issue aimed at reinforcing the Company's working capital and will mature in July 2020, being remunerated at 104.10% CDI. The subsidiary has swap transactions to protect itself fully against any devaluation of the Brazilian currency against the US Dollar in its borrowing and financing transactions. Nevertheless, this is not classified as hedge accounting (see note 36). The long-term portions of borrowing and financing as at December 31, 2019 mature as follows: 2021 305,171 2022 206,324 2023 33,434 2024 78,694 2025 21,285 644,908 The nominal value of loans is consistent with their respective payment schedule. Borrowing fair value In Brazil there is no consolidated long-term debt market with the characteristics of the BNDES facilities. In addition to the returns on long-term debt, the institutions take into account the social benefits of each project for which financing is granted. For the purposes of the fair value analysis, based on management's analyses any difference between nominal and fair value is immaterial in the context of the financial statements and debt of the company. The amount of PSI credit lines is recorded at fair value as at the withdrawal date, and the fair value is calculated considering the CDI rate as at the withdrawal date. Another transaction contracted with extremely specific features is the financing obtained from KFW Finnvera. This transaction is secured by Finnvera, a Finnish development agency. Given the features of this transaction, the Company believes that its fair value is equal to that shown in the balance sheet. Regarding the funds raised with Cisco Capital, current market conditions do not indicate the existence of any factor that might lead to a fair value for these transactions different to that shown in the accounting records. |
20. Indirect taxes, charges and
20. Indirect taxes, charges and contributions payable | 12 Months Ended |
Dec. 31, 2019 | |
Indirect Taxes, Charges And Contributions Payable [Abstract] | |
Indirect taxes, charges and contributions payable | 20. Indirect taxes, charges and contributions payable 2019 2018 Indirect taxes, charges and contributions payable 466,603 453,941 Value added tax on goods and services - ICMS 377,105 361,558 ANATEL taxes and charges 22,009 21,320 ISS 61,673 59,764 Others 5,816 11,299 Current portion (463,606) (451,169) Non-current portion 2,997 2,772 |
21. Direct taxes, charges and c
21. Direct taxes, charges and contributions payable | 12 Months Ended |
Dec. 31, 2019 | |
Direct Taxes, Charges And Contributions Payable [Abstract] | |
Direct taxes, charges and contributions payable | 21. Direct taxes, charges and contributions payable The current income tax and social contribution charges are calculated based on the tax laws enacted or substantially enacted up to the balance sheet date. Brazilian tax legislation allows companies to choose quarterly or monthly payments of income tax and social contribution. From 2016 onward, the Company chose to make monthly payments of income tax and social contribution. 2019 2018 Direct taxes, charges and contributions payable 508,615 542,213 Income tax and social contribution 346,097 372,467 PIS/COFINS 130,327 76,072 Other (*) 32,191 93,674 Current portion (296,305) (332,333) Non-current portion 212,310 209,880 (*) The composition of this account refers mainly to the subsidiary’s adherence to the Tax Recovery Program – REFIS, as of 2009. For installment payment of debts due on federal taxes (PIS, COFINS, IR and CSLL) whose final maturity will be on October 31, 2024. |
22. Deferred revenue
22. Deferred revenue | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Revenues [Abstract] | |
Deferred revenue | 22. Deferred revenue 2019 2018 Deferred revenues 1,109,112 1,313,467 Prepaid services to be provided (1) 186,310 301,621 Government grants (2) 42,159 63,731 Network swap (3) 2,713 11,449 Anticipated receipts 11,651 18,626 Deferred revenue for sale of towers (4) 843,017 897,112 Contractual liability (5) 23,262 20,928 Current portion (281,930) (406,867) Non-current portion 827,182 906,600 (1) This refers to the reloading of voice and data credits not yet used by customers involving prepaid system services, which are appropriated to income when customers actually avail themselves of these services. (2) Refers to the release of funds under the credit facility from the BNDES Investment Sustainment Program. The total sum of the subsidies granted by the BNDES through December 31, 2019, was R$203 million and the amount outstanding at December 31, 2019 and R$42,159 (63,731 at December 31, 2018). This amount is being amortized according to the useful life of the asset being financed and appropriated to the “Other income (expenses), net” (Note 28). (3) Refers mainly to the transfer of onerous contracts and reciprocal fiber optic infrastructure (Note 11). (4) Refers to amounts to be appropriated from sales of towers (Note 15). (5) Contracts with customers. As at December 31, 2019, the balance of contractual assets and liabilities was as follows: 2019 2018 Accounts receivable included in trade accounts receivable 2,413,865 2,189,931 Contractual asset (note 6) 15,142 130 Contractual liabilities (23,262) (20,928) Contracts with customers gave rise to the allocation of discounts under combined loyalty offers, where discounts may be given on equipment and/or services, generating a contractual asset or liability, respectively, depending on the nature of the offer in question. Summary of the main changes during the fiscal year: Contractual asset (liability) 2019 2018 Balances as at January 1, 2019 (20,798) (12,305) Additions 1,845 (23,545) Write-offs 10,833 15,052 Balances as at December 31, 2019 (8,120) (20,798) The estimated realization of the balances of contractual assets and liabilities is described below: 2020 2021 Contractual asset (liability) (5,953) (2,167) In accordance with paragraph 121 of IFRS 15, the Company is not presenting the effects of the information on contracts with customers that are effective for less than one year. |
23. Provision for legal and adm
23. Provision for legal and administrative proceedings | 12 Months Ended |
Dec. 31, 2019 | |
Provision For Legal And Administrative Proceedings [Abstract] | |
Provision for legal and administrative proceedings | 23. Provision for legal and administrative proceedings The Company and its subsidiary are parties to legal and administrative proceedings in the civil, labor, tax and regulatory spheres which arise in the normal course of their business. The provision is set up at an amount deemed sufficient and adequate to cover losses and risks considered probable, based on an analysis by the Company’s legal consultants and by Management. Situations where losses are considered probable or possible are subject to registration and disclosure, respectively, for their adjusted amounts, and those where losses are considered remote are not disclosed. The updated provision set up for legal and administrative proceedings is made up as follows: 2019 2018 Provision for legal and administrative proceedings 840,637 849,408 Civil (a) 212,702 111,301 Labor (b) 261,837 435,438 Tax (c) 333,717 271,214 Regulatory (d) 32,381 31,455 The changes in the provision for legal and administrative proceedings can be summarized as follows: Dec/2018 Additions, net of reversals Payments Monetary adjustment Dec/2019 849,408 547,691 (715,203) 158,741 840,637 Civil (a) 111,301 348,012 (335,640) 89,028 212,701 Labor (b) 435,438 96,235 (301,971) 32,136 261,838 Tax (c) 271,214 103,354 (77,341) 36,490 333,717 Regulatory (d) 31,455 90 (251) 1,087 32,381 Dec/2017 Additions, net of reversals Payments Monetary adjustment Dec/2018 528,320 551,191 (536,647) 306,544 849,408 Civil (a) 132,422 239,705 (324,803) 63,977 111,301 Labor (b) 184,311 225,864 (114,450) 139,713 435,438 Tax (c) 180,643 84,990 (96,346) 101,927 271,214 Regulatory (d) 30,944 632 (1,048) 927 31,455 The Company and its subsidiary are subject to various legal and administrative proceedings filed against them by consumers, suppliers, service providers, consumer protection agencies and public finance agencies, in connection with a number of issues that arise in the regular course of business of the entities. The main cases are summarized below: a. Civil proceedings a.1. Consumer lawsuits The Company is party to lawsuits that refer to some claims that have been filed by consumers at the legal and administrative levels. These claims, which amount to R$135,290 (R$86,039 as at December 31, 2018) basically refer to alleged incorrect collections, contract cancellation, service quality, deficiencies and failures in equipment delivery, and unjustified inclusion in credit protection services. a.2. Consumer protection agencies TIM is a party to court and administrative lawsuits filed by the Public Prosecutor’s Office, Procon and other consumer protection agencies arising from consumer complaints that include: (i) alleged failure to provide network services; (ii) challenges related to the quality of client assistance; (iii) alleged violation of SAC Decree; (iv) alleged violation of agreements; (v) alleged false advertising; and (vi) discussion of the amounts charged by the Company to its customers related to loyalty fines in the case of handset theft. The amounts involved total R$31,221 (R$5,814 as at December 31, 2018). a.3. Former trade partners TIM is a defendant in lawsuits filed by former trade partners claiming, among others, amounts on the basis of alleged non-compliance with agreements. The amounts involved total R$12,812 (R$10,378 as at December 31, 2018). a.4. Others TIM is a defendant in other non-consumer lawsuits filed by different agents to challenge, among others: (i) the renewal of lease agreements; (ii) share subscription; (iii) indemnities; (iv) alleged non-compliance with agreements; and (v) collection suits. The amounts involved total R$27,039 (R$3,060 as at December 31, 2018). a.5 Social, environmental and infrastructure The Company is party to lawsuits involving various agents challenging several licensing aspects, such as environmental licensing and structure licensing (installation/operation). The amounts involved total R$498 (R$239 as at December 31, 2018). a.6 ANATEL The subsidiaries are parties to lawsuits filed against ANATEL, challenging: (i) a debit related to the collection of 2% on revenue from value added services (“VAS”) and interconnection; (ii) pro rata b. Labor proceedings Below is a summary of the key labor proceedings claims with a likelihood of loss considered probable: Refer to various labor claims filed by former employees in relation to issues such as salary differences, parity, payment of variable compensation/commission, legal additions, overtime and other provision set forth in the period preceding the privatization process, and also claims filed by former employees of service providers who, taking advantage of the labor legislation currently in force, require the Company and/or its subsidiary to be held liable for labor obligations not complied with by the service providers contracted. Of the total number of 2,408 labor claims as at December 31, 2019 (3,948 as at December 31, 2018) filed against the Company and its subsidiary, most of them relate to claims involving former employees of service providers, followed by claims filed by the Company’s own employees. The provision for these proceedings amounts to R$252,968, monetarily restated (R$426,570 as at December 31, 2018). A significant portion of this provision refers to organizational restructuring procedures, of which the Company highlights the closing of the activities of the call centers, as well as proceedings related to TIM’s internal sites, which led to the termination of employee contracts. As at December 31, 2019, the provision for these proceedings totaled R$57,859, monetarily restated (R$27,981 as at December 31, 2018). c. Tax processes 2019 2018 Federal taxes 155,495 82,033 State taxes 93,790 103,546 Municipal taxes 8,227 1,713 TIM S.A. proceedings (purchase price allocation) 76,205 83,922 333,717 271,214 The total provision recorded is substantially composed of the following proceedings, and the amounts indicated are estimated using the indices established by the federal government for taxes in arrears, being linked to the variations in the SELIC rate: Federal taxes The provision is substantially composed of the following proceedings: a. The provision for TIM S.A. has been made for 37 cases challenging the taxes levied on CIDE, CPMF, CSLL and IRRF transactions, the voluntary reporting of the penalty regarding FUST payments and ancillary obligations. From these cases, the main amounts relate to court actions in which TIM intends to have the right not to pay the CPMF (a Federal contribution on financial movements) allegedly due to simultaneous purchase and sale transactions in foreign currency and changes to accountholders as a result of mergers, with updated provision amounts totaling R$9,560 (R$ R$9,335 as at December 31, 2018), as well as the amount corresponding to the fine and interest on FUST contribution for the year 2009, which does not include the benefits of voluntary reporting, for which the amount provided and updated is R$14,564 (R$14,060 as at December 31, 2018). b. The Company set up a provision for a lawsuit seeking to collect social security contribution withheld at a rate of 11%, to which payments made by the Company to other legal entities as compensation for sundry activities should have supposedly been subject. The amount provisioned and updated is R$37,977 (R$36,685 as at December 2018). c. Additionally, in the second quarter of 2019, the Company set up a provision for the FUST process alleging the unconstitutionality and illegality of FUST charges. Action for recognition of the right of not paying FUST and not including the revenues transferred as interconnection and EILD (Industrial Exploration of Dedicated Line) in the Company’s calculation base, as well as the right of not being charged retroactively for the differences due to non-compliance with ANATEL Precedent 7/2005, in the amount of R$58,116 (no corresponding amount on December 31, 2018). State taxes The provision is substantially composed of the following proceedings: The provision for TIM S.A. supports forty-one lawsuits, among which are (i) the amounts involved in the assessments that question the reversal of ICMS debts, as well as the documentary support for proving credits appropriated by the Company, whose amounts provisioned, updated, are equivalent to R$ 23,558 (R$ 42,628 as of December 31, 2018), (ii) amounts supposedly not offered for taxation by the rendering of telecommunications services, which, updated, amount to R$ 5,037 (R$ 4,829 as of December 31, 2018), as well as (iii) collections due to alleged differences both of goods entries and exits, in a quantitative stock survey procedure, whose updated amounts amount to R$ 15,460 (provisioned process on 03/2019, with no correspondent as of December 31, 2018). Municipal taxes These include the amounts involved in assessments questioning the withholding and payment of the ISS-source on services provided by third parties with no employment relationship, as well as the payment of own ISS regarding co-billing services. TIM S.A. PPA Tax proceedings arising from the acquisition of TIM S.A. and included in its purchase price allocation process, totaling R$76,205 (R$83,922 as at December 31, 2018). d. Regulatory processes ANATEL has brought administrative proceedings against the Group for: (i) failure to meet certain quality service indicators; (ii) defaults on certain obligations assumed under the Instruments of Authorization; and (iii) non-compliance with the regulations of SMP and STFC, among others. As at December 31, 2019, the amount classified as a probable risk related to Procedures to Verify Breaches of Obligations (“PADOs”), after monetary adjustments, amounted to R$32,381 (R$31,455 as at December 31, 2018). e. Legal and administrative processes involving possible losses Civil, labor, tax and regulatory actions have been filed against the Company and its subsidiary involving a risk of loss classified as possible by the Company’s legal advisors and the Management. No provision has been set up for these legal and administrative proceedings, and no materially adverse effects are expected on the financial statements, as shown below: 2019 2018 18,395,727 18,734,644 Civil (e.1) 1,032,637 1,046,521 Labor and social security (e.2) 459,020 523,236 Tax (e.3) 16,196,077 16,530,061 Regulatory (e.4) 707,993 634,826 The administrative and legal proceedings assessed as possible losses and monitored by Management are disclosed at their updated values. The main actions where the risk of loss is classified as possible are described below: e.1. Civil 2019 2018 Actions filed by consumers (e.1.1) 374,860 405,635 ANATEL (e.1.2) 220,526 207,657 Consumer Protection Agencies (e.1.3) 32,847 84,231 Former trade partners (e.1.4) 180,226 173,213 Social and environmental, and infrastructure (e.1.5) 125,201 71,574 Other (e1.6) 98,977 104,211 1,032,637 1,046,521 e.1.1. Actions filed by consumers These actions refer particularly to alleged incorrect billing, contract cancellation, service quality, deficiencies and failures in equipment delivery, and unjustified inclusion in bad debtors’ lists. e.1.2. ANATEL The Company is party to lawsuits filed against ANATEL, for the following reasons: (i) debit regarding the collection of 2% on revenue obtained from VAS and interconnection; (ii) pro rata e.1.3. Consumer Protection Agencies The Company is a party to court and administrative lawsuits filed by the Public Prosecutor’s Office, Procon and other consumer protection agencies arising from consumer-related complaints that include: (i) alleged failure to provide network services; (ii) alleged failure to deliver devices; (iii) alleged non-compliance with state legislation; (iv) contract model and alleged incorrect charging for VAS; (v) alleged violation of SAC Decrees; (vi) alleged violation of agreements; and (vii) blocking of data. e.1.4. Former trade partners The Company is a defendant in actions filed by several former trade partners who are claiming, among other items, amounts arising from alleged non-compliance with agreements. e.1.5. Social, environmental and infrastructure The Company is party to lawsuits involving different parties that challenge aspects related to: (1) environmental licensing and structure licensing (installation/operations), and (2) (i) electromagnetic radiation emitted by the telecom structures, (ii) renewal of leasing land agreements to install sites, (iii) eviction from land leased to install sites, and (iv) presentation of registration data, among others. e.1.6 Others The Company is a party to other lawsuits of an essentially non-consumer-related nature filed by various agents other than those described above, in which the discussions involve: (i) renewals of lease agreements, (ii) share subscription lawsuits, (iii) compensation lawsuits, (iv) alleged breach of contract, and (v) lawsuits involving charges. e.2. Labor claims e.2.1. Social security The Company’s subsidiary received a Debit Assessment Notice, related to the alleged irregularity in the payment of social security contributions related to the payment of Profit Sharing, in the amount of R$ 538, adjusted (R$ 538 on December 31, 2018) and also suffered a tax assessment related to alleged social security contributions levied on hiring bonus; unadjusted bonus; consideration for self-employed activities and sales incentives in the updated amount of R$ 9.693 at December 31, 2019. The Company’s subsidiary received Tax Underpayment Assessments regarding alleged irregularity related to the payment of social security contributions levied on profit sharing; failure to pay Management’s fees and failure properly to fill out the FGTS – GFIP tax form, and an erroneous GFIP declaration in the updated amount of R$1,559 (R$1,430 as at December 31, 2018). e.2.2. Labor There are 3,976 labor claims at December 31, 2019 (4,654 at December 31, 2018) filed against the Company and its subsidiary, related to claims involving former employees and service providers in the amount of R$459,020 updated (R$ 523,236 at December 31, 2018). A significant portion of the existing contingency relates to organizational restructuring processes, of which the closure of the activities of the Customer Relationship Centers (call center) stands out, as well as processes related to the company’s internal sites, which resulted in the dismissal of employees. In addition to these processes, there are those carried out by third party service providers with requests for employment with the company’s, whose amounts total R$ 14,349 updated (R$ 16,709 as of December 31, 2018). It should also be pointed out that there is a group of labor claims, particularly in São Paulo and Rio de Janeiro, from former employees of Gazeta Mercantil, Jornal do Brasil and JB Editora requesting in court the inclusion in the liability center of Holdco, which before the merger with TIM Participações, belonged to the Grupo Econômico Docas, of which Gazeta Mercantil and Jornal do Brasil are part. The other amounts are related to labor lawsuits filed by former employees and third companies. e.3. Tax 2019 2018 Federal taxes (e.3.1) 4,279,570 3,952,125 State taxes (e.3.2) 8,221,808 8,904,916 Municipal taxes (e.3.3) 703,132 693,616 FUST, FUNTTEL and EBC (e.3.4) 2,991,567 2,979,404 16,196,077 16,530,061 The amounts are adjusted based on an estimate of the SELIC rate. The historical amount involved is equivalent to R$11,549,274 (R$ 11,662,216 as of December 31, 2018). Of the total amount of tax litigations, R$3.474.714 relates to income taxes contingencies, which have been assessed by Management and based on its internal and external experts, it is not likely that the Company’s treatments will not be accepted by the Brazilian tax authority. e.3.1. Federal taxes Assessment against the TIM Group for federal taxes amounted to R$4,279,570 as at December 31, 2019, (R$3,952,125 as at December 31, 2018). Of this total, the following issues stand out: (i) Alleged errors in the use of tax credits due to a reverse merger, the amortization of goodwill paid on the acquisition of mobile phone companies, deduction of goodwill amortization expenses, exclusion of goodwill reversal, other effects and the disallowance of offsetting and estimated deductions paid, allegedly improper use of SUDENE benefits caused by a lack of formalization of these benefits in the Federal Revenue Department (“RFB”) and failure to pay the estimated IRPJ and CSLL amounts. The amount involved is R$2,672,754 (R$2,543,851 as at December 31, 2018). (ii) Method of offsetting tax losses and negative bases. The amount involved is R$203,302 (R$198,175 as at December 31, 2018). (iii) Collection of CSLL on monetary variations for swap transactions, recorded on a cash basis. The amount involved is R$66,164 (R$64,537 as at December 31, 2018). (iv) Payment of IRRF on revenue from overseas residents, including those remitted for international roaming and payments to unidentified beneficiaries, as well as the collection of CIDE on royalties remitted overseas, including remittances for international roaming. The amount involved for the subsidiary is R$256,833 (R$296,589 as at December 31, 2018). (v) Charging of IRPJ, PIS/COFINS and CSLL debts for the non-approval or partial approval of offsetting carried out by the Company using credits from withholding tax on financial investments and negative IRPJ balance. The amount involved is R$427,233 (R$412,715 as at December 31, 2018). e.3.2. State taxes Assessment against the Company Group for state taxes amounting as at December 31, 2019 to R$8,221,808 (R$8,904,916 as at December 31, 2018). Of the total amount, the following issues stand out: (i) Failure to include unconditional discounts offered to customers in the ICMS calculation base, and a fine for alleged failure to comply with related ancillary obligations, including failure to submit register 60i of the SINTEGRA file. The amount involved is R$1,053,411 (R$1,344,288 as at December 31, 2018). (ii) Use of tax benefits under the Program for Promoting the Integrated and Sustainable Economic Development of the Federal District granted by the tax authority itself, but subsequently declared an unconstitutional and alleged incorrect crediting of ICMS on interstate purchases of goods with tax benefits granted in the state of origin. The amount involved is R$887,67 (R$1,110,827 as at December 31, 2018). (iii) Credit reversal and late use of credits for purchases of fixed assets. The amount involved for its subsidiary. is R$731,864 (R$767,142 as at December 31, 2018). (iv) ICMS credits booked and debits reversed, as well as the identification and supporting documentation for amounts and information passed to customer bills, such as tax rates and credit granted as prepayment of future recharges (special credit), as well as credits related to transactions involving tax substitution, exempt and non-taxable transactions. As at December 31, 2019, the amount involved for the subsidiary was R$3,284,473 (R$3,340,448 as at December 31, 2018). (v) The use of credit to purchase electricity for the companies’ production processes. The amount involved is R$131,057 (R$140,368 as at December 31, 2017). (vi) Alleged conflict between ancillary obligation data and the payment of the tax, and specific questioning regarding the fine charged due to non-compliance with ancillary obligations. The amount involved is R$138,684 (R$116,880 as at December 31, 2018). (vii) Alleged failure to pay ICMS arising from debts reversed regarding prepaid services, incorrect ICMS credits regarding outgoing goods allegedly benefiting from a reduction in the calculation base, as well as an alleged failure to include VAS of the ICMS calculation base. The amount involved is R$198,505 (R$192,074 as at December 31, 2018). (viii) Credits booked for the return of cell phones on free lease. The amount involved is R$180,920 (R$177,128 as at December 31, 2018). (ix) Collection of ICMS tax on subscription services and the alleged failure to include this in the ICMS calculation base due to its nature. The amount involved is R$249,659 (R$139,758 as at December 31, 2018). e.3.3. Municipal taxes The total assessment against the TIM Group for municipal taxes was R$703,132 as at December 31, 2019, (R$693,616 as at December 31, 2018). Of this amount, the following issues stand out: a. Payment of ISS and of a punitive fine for failure to pay the alleged tax on various revenue accounts of the Company. The amount involved is R$147,572 (R$142,355 as at December 31, 2018). b. Collection of ISS on import of services. The amount involved is R$300,669 (R$283,620 as at December 31, 2018). c. Constitutionality of the collection of the TFF by municipal authorities in several locations. The amount involved is R$120,503 (R$118,114 as at December 31, 2018). e.3.4. FUST and FUNTTEL The amount assessed against the TIM Group for contributions to FUST and FUNTTEL is R$2,991,567 (R$2,979,404 as at December 31, 2018). The principal discussion involves the payment of the contributions to FUST and FUNTTEL (the Telecommunications Technical Development Fund) starting from the issue by ANATEL of Ruling No. 07/2005, relating primarily to the payment of the FUST and FUNTTEL contributions on interconnection revenue earned by mobile telecommunications service providers, from the effective date of Law N o e.4. Regulatory issues ANATEL has filed administrative proceedings against the subsidiary for: (i) not complying with certain quality indicators, (ii) defaulting on other obligations under Instruments of Authorization, and (iii) not complying with SMP and STFC regulations, among other items. As at December 31, 2019, the amount stated for Breach of Obligation procedures (locally PADOs), considering the monetary restatement that was considered possible loss was R$707,993 (R$634,826 as at December 31, 2018). The variations mainly resulted from the handling of the PADOs included in the Consent Decree - “TAC” negotiated with ANATEL and new revenue recorded in the year 2019. On August 22nd, 2019, Anatel's Board of Directors unanimously approved TIM's Conduct Adjustment Term, which was under negotiation since June 2018. The agreement covers a sanction reference value of R$ 627 million. TIM's commitment foresees improvement actions in three pillars - customer experience, quality and infrastructure - through initiatives associated with improvements in the licensing process of stations, efficient use of numbering resources, evolution of digital caring channels, reducing complaint rates, repairing users and strengthening transport and access networks. In addition, it includes an additional commitment to bring mobile broadband through the 4G network to 366 municipalities with less than 30,000 inhabitants reaching over 3.4 million people. The new infrastructure will be implemented in three years - more than 80% in the first two years –with the sharing regime with the other providers being guaranteed by the Company. On obtaining an extension of the authorization to use radio frequencies associated with SMP, the subsidiary TIM S.A. incurs contractual charges on net revenue from service plans sold under each authorization. However, ANATEL has included interconnection revenue in the calculation base for these charges since 2011, and revenue from VAS since 2012. In the Company's opinion, this revenue should not be included because it is not expressly stipulated in the original Instruments of Authorization. Therefore, the charges received are being discussed at the administrative and/or legal levels. |
24. Shareholders' equity
24. Shareholders' equity | 12 Months Ended |
Dec. 31, 2019 | |
Shareholders' equity | |
Shareholders' equity | 24. Shareholders’ equity a. Capital stock The capital is stated at the amount effectively raised from shareholders, net of the costs directly linked to the issuance process. When a company within the Group purchases the Company’s shares, intending to hold them as treasury shares, the amount paid, including any directly attributable additional costs, is deducted from the Company’s shareholders’ equity until the shares are cancelled or reissued. When these shares are reissued subsequently, any amount received, net of additional costs directly attributable to the transaction, is included in shareholders’ equity. As at December 31, 2019, the Company held 210,527 treasury shares (784,317 for 2018) with a view to fulfilling the stock option plan (Note 25). The Company is authorized to increase its capital upon a resolution by the Board of Directors, without amending the bylaws, up to the limit of 4,450,000,000 common shares. The subscribed and paid up capital is represented as follows: 2019 2018 Net value paid up 9,866,298 9,866,298 Value paid up 9,913,415 9,913,415 (-) Funding costs (47,117) (47,117) Number of common shares 2,421,032,479 2,421,032,479 b. Capital reserves The use of capital reserves is in accordance with the provisions of Article 200 of Law No. 6.404/76, which refers to corporate entities. These reserves consist of: 2019 2018 410,650 412,091 Special goodwill reserve 380,560 380,560 Stock options 30,090 31,531 b.1 Special goodwill reserve The special goodwill reserve arose from the following transactions: (i) Takeover of the former subsidiaries TIM Sul and TIM NE - acquisition of minority shares In 2005, the Company acquired all the shares held by the minority shareholders of TIM Sul S.A. and TIM Nordeste Telecomunicações S.A. This acquisition took place by issuing new shares of TIM Participações S.A., converting those companies into full subsidiaries. At that time, this transaction was recorded at the book value of the shares, no goodwill being recorded arising from the difference between the market value and the shares negotiated. When first adopting IFRS, the Company availed itself of the exemption that allows a subsidiary, when it adopts international accounting practices subsequent to its Parent Company having adopted IFRS, to consider the balances previously reported to the Parent Company for consolidation purposes. In the balance sheet of the transition to IFRS, the Company recorded the acquisition price based on the market value of the shares of TIM Participações S.A. at that time, recording goodwill amounting to R$157,556. (ii) Acquisition of the shares of Holdco - purchase of TIM S.A (Intelig) As at December 30, 2009, the Special General Meeting of TIM Participações approved the takeover of Holdco, a company that held 100% of the equity of TIM S.A, by TIM Participações. As a result of this transaction, the Company issued 127,288,023 shares. Based on the former Brazilian accounting principles (“BR GAAP”), the acquisition was recorded at the net book value of the assets acquired on the base date of November 30, 2009. When IFRS was first adopted, the acquisition was recorded on the base date of December 31, 2009, taking into account the market value of the common and preferred shares of TIM Participações as at December 30, 2009, amounting to R$739,729. The difference between this amount and the book value recorded under the former BR GAAP (R$516,725) created goodwill on capital reserves of R$223,004. b.2 Stock options The balances recorded in these items represent the expenses of the Company and its subsidiary for the share options granted to their employees (Note 25). In the year ended December 31, 2019 and the year ended 2018, the Company sold 668,367 and 1,194,576 common shares, respectively, to the beneficiaries of the Stock Option Plan (Note 25). These shares were in the Company's treasury when the options were exercised at the average book value of R$10.86 and R$10.34, respectively. Additionally, through the Share Buyback Program launched in October 2017, the Company acquired 115,949 shares in 2019 (377,052 in 2018) at the price of R$15.22 and R$11.64, respectively, equivalent to R$ 3,204 in 2019 (R$ 4,389 in 2018). As a result, the net effect on the repurchase transaction of treasury shares was R$5,319 (R$7,964 in 2018). c. Profit reserves c.1 Legal reserve This refers to 5% of the income for every year ended December 31, until the legal reserve equals 20% of the capital stock, excluding, as from 2018, the balance set aside for the tax incentive reserve. Also, the Company is authorized to cease setting up a legal reserve when, together with the capital reserves, it exceeds 30% of the capital stock. This reserve can be used only for capital increases or the offsetting of accumulated losses. c.2 Statutory reserve for expansion This reserve is set up based on paragraph 2, Article 46 of the Company’s bylaws and is intended for the expansion of the corporate business. The balance of profit that is not compulsorily allocated to other reserves and that is not allocated for the payment of dividends, is allocated to this reserve, which may not exceed 80% of the capital. Once this limit is reached, it is incumbent upon the shareholders’ meeting to decide on the balance, either distributing this to shareholders or increasing the capital. In December 2019, the Reserve for Expansion reached the limit defined in the Company's bylaws. Therefore, the next meeting will propose a capital increase via capitalization of the expansion reserve in the amount of R$ 1,644,013. This increase may be made without the issuance of new shares in proportion to the rights of shareholders. c.3 Tax benefit reserve The subsidiary was granted tax benefits that provide for restrictions on the distribution of profits by this subsidiary. According to the legislation establishing these tax benefits, the amount of taxes waived as a result of exemptions and reductions in the tax charge may not be distributed to shareholders and must be registered as a tax incentive reserve for the legal entity. This reserve should only be used for offsetting the losses or capital increases. At December 31, 2019, the accumulated amount of benefits enjoyed by the subsidiary was R$ 1,612,019 (R$1,417,858 at December 31, 2018). This tax benefit basically corresponds to a reduction in the IRPJ on income from exploration, recorded by the units entitled to this benefit. The subsidiary operates in the area of the former Superintendence for Development of the Amazon (“SUDENE/SUDAM”), and the tax benefit reports are granted by the state, for a period of ten years, subject to extension. d. Dividends Dividends are calculated in accordance with the bylaws and Brazilian Corporate Legislation. As stated in the most recent bylaws approved on April 14, 2016, the Company must distribute a mandatory dividend for each business year ended December 31, provided that funds are available for distribution, equivalent to 25% of the revised profit. As provided for in the Company’s bylaws, dividends not claimed within three years will be reversed to the Company. As at December 31, 2019, dividends and interest on equity were calculated as shown below: 2019 2018 Net income for the year 3,622,127 2,545,101 (-) Tax incentives not to be distributed (194,161) (146,455) (-) Legal reserve constitution (171,398) (119,932) Revised profit 3,256,568 2,278,714 Minimum dividends calculated considering 25% of the revised profit 814,142 569,679 Breakdown of dividends payable and interest on equity: Interest on shareholders’ equity 995,438 849,994 Total dividends and interest on shareholders’ equity distributed and proposed 995,438 849,994 IRRF on interest on shareholders’ equity (149,316) (125,757) Total dividends and interest on shareholders’ equity, net 846,122 724,237 Dividends per share (amount in reais), net of IRRF 0.35 0.30 Interest on shareholders’ equity paid and/or payable is recorded against financial expenses which, for the purposes of presentation of the financial statements, are reclassified and disclosed in the allocation of net income for the year/period, in changes in shareholders’ equity. Interest on shareholders’ equity received and/or receivable is recorded against financial revenue, with an impact on the equity accounting income. For disclosure purposes, the impacts on income are eliminated, and a reduction is recorded in the investment balance. As of December 31, 2019, the amount provisioned was R$995,438, of which R$ 313,600 was paid over the year and the remaining balance is recorded in the Company's current liabilities and paid in January 2020. Dividends not claimed – As provided for in the Brazilian Corporate Law, dividends and interest on shareholders’ equity that are declared but not claimed by shareholders for a period of three years are reversed to the shareholders’ equity according to the statute of limitations. Regarding the statement of cash flow, interest on shareholders’ equity and dividends paid to shareholders were classified as “financing activities”. |
25. Long-term incentive plan
25. Long-term incentive plan | 12 Months Ended |
Dec. 31, 2019 | |
Long-Term Incentive Plan [Abstract] | |
Long-term incentive plan | 25. Long-term incentive plan 2011-2013 Plan, 2014-2016 Plan and 2018-2020 Plan At the annual meeting on August 5, 2011, April 10, 2014 and April 19, 2018, the shareholders of TIM Participações S.A. approved the long-term incentive plans, respectively the “2011-2013 Plan”, the “2014-2016 Plan” and the "2018-2020 Plan" for the senior Management and key executives of the Company and its subsidiary. The 2011-2013 and 2014-2016 Plans involve granting options, while the 2018-2020 Plan provides for the granting of shares. The exercise of options under the 2011-2013 Plan depends on the achievement of specific performance targets, while the exercise of options of the 2014-2016 Plan is not subject to this condition. The Exercise Price is calculated with an upward or downward adjustment to the Base Share Price, according to share performance, as provided for in each Plan. The 2018-2020 Plan, in turn, proposes granting to the participants shares issued by the Company, subject to certain time and/or performance conditions (attainment of specific targets). The number of shares may vary up or down depending on performance and possible declarations of dividends, considering the criteria specified for each Grant. Share options of the 2011-2013 and the 2014-2016 Plans are effective for six years, and TIM Participações has no legal or informal obligation to repurchase or settle the options in cash. In the case of the 2018-2020 Plan, the effectiveness period is the same as the vesting period of three years. The 2018-2020 Plan, in turn, besides allowing for the transfer of shares, also provides for the possibility of making payments to the participants of the equivalent cash value. The total amount of the expense is recognized during the vesting period: that is, the period during which specific vesting conditions must be met. On the date of each balance sheet, the Group reviews its estimates for the number of options that will vest, considering vesting conditions not related to the market and time with the company. It should also be taken into account that in 2017 there were no new grants, only the calculations of the vesting period from past grants. The variations in the quantity of shares/options are presented below: Date of grant Share options granted Maturity Date Exercise price Balance at beginning of 2019 financial year Granted in the period Exercised in the period Forfeited in the period Failing due in the period Balance at beginning of 2019 financial year 2018-2020 Plan - 2ª Grant 930,662 Jul/22 R$ 11.28 - 930,662 - (33,418) - 897,244 2018-2020 Plan – 1 st 849,932 Apr/21 R$ 14.41 466,514 - (115,949) (97,228) - 253,337 2014-2016 Plan – 3 rd 3,922,204 Nov/22 R$ 8.10 895,522 - (476,182) - - 419,340 2014-2016 Plan – 2 nd 3,355,229 Oct/21 R$ 8.45 292,523 - (159,675) - - 132,848 2014-2016 Plan – 1 st 1,687,686 Sep/20 R$ 13.42 531,972 - (32,511) (121,175) - 378,286 2011-2013 Plan – 3 rd 3,072,418 Jul/19 R$ 8.13 543,583 - - - (543,583) - 2011-2013 Plan – 2 nd 2,661,752 Sep/18 R$ 8.96 - - - - - - 2011-2013 Plan – 1 st 2,833,595 Aug/17 R$ 8.84 - - - - - - Total 19,313,478 2,730,114 930,662 (784,317) (251,821) (543,583) 2,081,055 Average weighted price for the period R$ 11.23 Date of grant Share options granted Maturity Date Exercise price Balance at beginning of 2018 financial year Granted in the period Exercised in the period Forfeited in the period Failing due in the period Balance at beginning of 2018 financial year 2018-2020 Plan – 1 st 849,932 May/20 14.41 - 849,932 (383,418) - 466,514 2014-2016 Plan – 3 rd 3,922,204 Nov/22 8.10 2,684,284 (510,884) (1,277,878) - 895,522 2014-2016 Plan – 2 nd 3,355,229 Oct/21 8.45 1,240,740 (656,268) (291,949) - 292,523 2014-2016 Plan – 1 st 1,687,686 Sep/20 13.42 658,720 (27,424) (99,324) - 531,972 2011-2013 Plan – 3 rd 3,072,418 Jul/19 8.13 694,936 (151,353) - 543,583 2014-2016 Plan – 2 nd 2,661,752 Sep/18 8.96 194,756 (194,756) - 2014-2016 Plan – 1 st 2,833,595 Aug/17 8.84 - - - Total 18,382,816 5,473,436 849,932 (1,194,576) (2,203,922) (194,756) 2,730,114 Average weighted price for the period 10.26 Below are the significant data included in the model: Date of grant Weighted average base price of shares during the vesting period of the grant Volatility Expected useful life of the option Annual interest rate without risk 2011 Grant R$ 8.84 51.73% p.a 6 years 11.94% p.a 2012 Grant R$ 8.96 50.46% p.a 6 years 8.89% p.a 2013 Grant R$ 8.13 48.45% p.a 6 years 10.66% p.a 2014 Grant R$ 13.42 44.60% p.a 6 years 10.66% p.a 2015 Grant R$ 8.45 35.50% p.a 6 years 16.10% p.a 2016 Grant R$ 8.10 36.70% p.a 6 years 11.73% p.a 2018 Grant R$ 14.41 NA 3 years NA 2019 Grant R$ 11.28 NA 3 years NA The Base Share Price was calculated using the weighted prices of the shares of TIM Participações, during the following periods: 2011-2013 Plan – 1 st 2011-2013 Plan– 2 nd 2011-2013 Plan– 3 rd . 2014-2016 Plan– 1 st 2014-2016 Plan– 2 nd . 2014-2016 Plan– 3 rd . 2018-2020 Plan – 1 st 2018-2020 Plan – 2 nd The Company recognizes the impact of review of its initial estimates, if any, in the statement of income, with a contra-entry in shareholders’ equity. As at December 31, 2019 the expenses related to said long-term benefit plans totaled R$2,359 (R$ 4,291 as at December 31, 2018). |
26. Net revenue
26. Net revenue | 12 Months Ended |
Dec. 31, 2019 | |
Revenue [abstract] | |
Net revenue | 26. Net revenue Revenue from services rendered The principal service revenue derives from monthly subscription, the provision of separate voice, SMS and data services, and user packages combining these services, roaming charges and interconnection revenue. The revenue is recognized as the services are used, net of sales taxes and discounts granted on services. This revenue is recognized only when the amount of services rendered can be estimated reliably. Revenues are recognized monthly, through billing, and revenues to be billed between the billing date and the end of the month (unbilled) are identified, processed, and recognized in the month in which the service was provided. These non-billed revenues are recorded on an estimated basis, which takes into account consumption data, number of days elapsed since the last billing date. Interconnection traffic and roaming revenue are recorded separately, without offsetting the amounts owed to other telecom operators (the latter are accounted for as operating costs). The minutes not used by customers and/or reload credits in the possession of commercial partners regarding the prepaid service system are recorded as deferred revenue and allocated to income when these services are actually used by customers. Revenue from product sales Revenues from product sales (telephones, mini-modems, tablets and other equipment) are recognized when the performance obligations associated with the contract are transferred to the buyer. Revenues from sales of devices to trading partners are accounted for at the time of their physical delivery to the partner, net of discounts, and not at the time of sale to the end customer, since the Company has no control over the product sold. Contract Identification The Company reviews all current commercial contracts in order to identify the main contractual clauses and other elements present in the contracts that could be relevant in the application of the new accounting pronouncement. Identification of performance obligation Based on the review of its contracts, the Company verified the existence of two performance obligations: (i) sale of equipment; and (ii) provision of mobile, fixed and internet telephony services. Therefore, the Company began to recognize revenues when, or as, the performance obligation is met when transferring the good or service promised to the customer; the asset is considered transferred when or as the customer obtains control of this asset. Determining and Allocating the Transaction Price to the Performance Obligation The Company understands that its commercial packages that combine services and sale of cellular handsets with discounts. In accordance with IFRS 15, the Company is required to perform the discount allocation and recognize revenues related to each performance obligation based on their standalone selling prices. Prior to the adoption of the standard, the Company recognized revenue from each element identified based on its contractual price, with the discount on the sale of handsets being allocated completely to the price of the handset. As a consequence of the adoption of the new standard, an additional portion of the revenue was allocated to revenues from sale of handsets at the beginning of the contract, representing an increase in revenues from the sale of equipment in relation to previously adopted accounting practice. The difference between the amount of revenue and the amount of equipment sales revenue at the beginning of the contract was recognized at the time each as a contractual asset, allocated to service revenue along the contract period. Cost to obtain contract All incremental costs related to obtaining a contract (sales commissions and other costs of acquisition from third parties) are recorded as prepaid expenses and amortized over the same period as the revenue associated with this asset. Similarly, certain contract compliance costs are also deferred to the extent that they relate to performance obligations under the customer agreement, i.e. when the customer obtains control over the asset. 2019 2018 2017 Net operational revenue 17,377,194 16,981,329 16,233,959 Gross operating revenue 25,182,831 24,232,404 22,611,074 Service revenue 23,820,343 23,065,648 21,433,515 Service revenue – Mobile 22,145,033 21,531,779 20,147,585 Service revenue – Landline 1,675,310 1,533,869 1,285,930 Goods sold 1,362,488 1,166,756 1,177,559 Deductions from gross revenue (7,805,637) (7,251,075) (6,377,115) Taxes (4,939,980) (5,163,797) (5,027,406)) Discounts given (2,843,670) (2,073,892) (1,329,600) Returns and other (21,987) (13,386) (20,109) |
27. Operating costs and expense
27. Operating costs and expenses | 12 Months Ended |
Dec. 31, 2019 | |
Operatings Costs And Expenses [Abstract] | |
Operating costs and expenses | 27. Operating costs and expenses 2019 2018 Cost of services provided and goods sold Selling expenses General and administrative expenses Total Cost of services provided and goods sold (*) Selling expenses General and administrative expenses Total (7,433,731) (4,986,289) (1,717,859) (14,137,879) (7,701,418) (4,970,780) (1,608,319) (14,280,517) Personnel (53,392) (624,353) (392,984) (1,070,729) (36,514) (637,177) (357,878) (1,031,569) Third-party services (569,242) (2,041,646) (512,643) (3,123,531) (518,762) (2,169,624) (451,990) (3,140,376) Interconnection and means of connection (1,419,464) - - (1,419,464) (2,513,176) - - (2,513,176) Depreciation and amortization (4,132,223) (256,898) (739,860) (5,128,981) (3,119,954) (162,804) (671,562) (3,954,320) Taxes, fees and contributions (32,120) (817,369) (18,846) (868,335) (31,754) (866,197) (18,333) (916,284) Rent and insurance (291,302) (121,795) (20,590) (433,687) (591,226) (146,877) (67,387) (805,490) Cost of goods sold (931,818) - - (931,818) (883,912) - - (883,912) Publicity and advertising - (355,234) - (355,234) - (421,588) - (421,588) Losses on doubtful accounts - (748,291) - (748,291) - (544,881) - (544,881) Other (4,170) (20,703) (32,936) (57,809) (6,120) (21,632) (41,169) (68,921) 2017 Cost of services provided and goods sold Selling expenses General and administrative expenses Total (8,002,077) (4,575,177) (1,424,643) (14,001,897) Personnel (48,802) (602,578) (305,036) (956,416) Third-party services (544,036) (2,049,994) (429,597) (3,023,627) Interconnection and means of connection (2,632,593) - - (2,632,593) Depreciation and amortization (3,280,524) (162,020) (571,126) (4,013,670) Taxes, fees and contributions (36,625) (919,018) (11,963) (967,606) Rent and insurance (609,595) (92,363) (62,954) (764,912) Cost of goods sold (846,839) - - (846,839) Publicity and advertising - (410,982) - (410,982) Losses on doubtful accounts - (316,387) - (316,387) Other (3,063) (21,835) (43,967) (68,865) The Company contribute to public and private pension insurance plans in a mandatory, contractual or voluntary manner during the time when employees are working at the Company. These plans do not originate any additional obligation for the Company. When an employee leaves the Company during the period required for entitlement to receive the contributions made by the sponsors, the amounts to which the employee ceased to be entitled, and that may represent a reduction in future contributions of the Company to active employees, or a refund in cash of these amounts, are recorded in assets. |
28. Other income (expenses), ne
28. Other income (expenses), net | 12 Months Ended |
Dec. 31, 2019 | |
Other Income (Expenses), Net [Abstract] | |
Other income (expenses), net | 28. Other income (expenses), net 2019 2018 2017 Income Subsidy income, net 21,572 25,305 28,722 Fines on telecommunications services 50,499 44,411 41,699 Revenue from disposal of assets 2,214 1,708 2,865 Other income (a) 1,878,558 282,041 171,273 1,952,843 353,465 244,559 Expenses FUST/FUNTTEL (b) (137,169) (143,167) (140,878) Taxes, fees and contributions (4,024) (4,092) (4,466) Provision for legal and administrative proceedings, net of reversal (466,460) (452,463) (366,476) Expenses from disposal of assets (7,055) (4,424) (6,618) Other expenses (62,593) (32,608) (24,831) (677,301) (636,754) (543,269) Other revenues (expenses), net 1,275,542 (283,289) (298,710) (a) The variation in the period refers to: (i) credits from legal proceedings held by the Company with a final decision in favor of the Company in higher courts in 2019, which discussed the exclusion of ICMS from the calculation base of PIS and COFINS contributions. The amount of R$ 1,795 million was recorded under other revenues in June 2019 (Note 9) and (ii) amortization of deferred revenue from the sale of the towers (Note 15). (b) Expenses incurred with contributions on several telecommunications revenue amounts due to ANATEL, according to the legislation in force. |
29. Financial income
29. Financial income | 12 Months Ended |
Dec. 31, 2019 | |
Financial Income [Abstract] | |
Financial income | 29. Financial income 2019 2018 2017 Financial income 1,430,171 412,733 512,565 Interest on financial investments 88,224 119,548 369,517 Interest received from clients 37,233 36,793 38,227 Swap interest 15,536 17,001 32,300 Interest on leasing 20,528 25,664 22,709 Monetary adjustments (i) 1,263,793 207,191 39,694 Foreign exchange variation 4,857 6,536 10,118 (i) Includes the amount of R$1,228 million regarding the adjustment of credits from a legal proceeding of TIM Celular S.A. (absorbed by TIM S.A.) on the exclusion of ICMS from PIS and COFINS tax bases (Note 9). |
30. Financial expenses
30. Financial expenses | 12 Months Ended |
Dec. 31, 2019 | |
Financial Expenses [Abstract] | |
Financial expenses | 30. Financial expenses 2019 2018 2017 Financial expenses (1,408,053) (951,439) (1,009,653) Interest on borrowing and financing (116,735) (96,682) (211,108) Interest on taxes and fees (28,396) (15,409) (5,712) Swap interest (24,604) (32,424) (85,362) Interest on leasing (821,463) (266,328) (257,305) Monetary adjustment (2) (191,309) (340,175) (278,272) Discounted granted (36,047) (38,858) (52,683) Other expenses (1) (189,499) (161,563) 119,211 (1) (2) |
31. Foreign exchange variations
31. Foreign exchange variations, net | 12 Months Ended |
Dec. 31, 2019 | |
Foreign Exchange Variations, Net [Abstract] | |
Foreign exchange variations, net | 31. Foreign exchange variations, net 2019 2018 2017 Revenue Borrowing and financing 22,494 1,409 287,777 Suppliers 9,004 6,844 4,124 Swap 40,742 75,340 130,971 Others 15,952 13,937 7,146 88,192 97,530 430,018 Expenses Borrowing and financing (40,715) (75,298) (271,286) Suppliers (13,201) (11,925) (6,819) Swap (22,493) (1,409) (147,356) Others (12,691) (7,525) (5,305) (89,100) (96,157) (430,766) Exchange variations, net (908) 1,373 (748) Exchange variation in the year is related to loans and financing and suppliers in foreign currency. The effect was reduced by operations with derivatives (note 36). |
32. Income tax and social contr
32. Income tax and social contribution | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax And Social Contribution [Abstract] | |
Income tax and social contribution | 32. Income tax and social contribution 2019 2018 2017 Current income and social contribution taxes Income tax for the year (155,521) (253,120) (203,932) Social contribution for the year (58,905) (92,502) (77,148) Tax incentive – SUDENE/SUDAM (l) 156,594 146,454 112,493 (57,832) (199,168) (168,587) Deferred income tax and social contribution Deferred income tax (625,516) 651,632 (23,976) Deferred social contribution (225,186) 217,501 (8,631) (850,702) 869,133 (32,607) Provision for income tax and social contribution contingencies (5,406) (5,054) 185 (856,108) 864,079 (32,422) (913,940) 664,911 (201,009) The reconciliation of income tax and social contribution expenses calculated at the applicable tax rates plus the amounts reflected in the statement of income is set forth below: 2019 2018 2017 Income before income tax and social contribution 4,536,066 1,880,190 1,435,516 Combined tax rate 34% 34% 34% Combined tax rate on income tax and social contribution (1,542,262) (639,265) (488,075) (Additions)/exclusions: Unrecognized/recognized tax losses and temporary differences (18,783) 920,745 68,716 Permanent additions and exclusions: Non-deductible expenses for tax purposes (10,958) (12,040) (6,638) Tax benefit related to interest on shareholders’ equity 338,449 288,998 64,597 Tax incentive (i) 194,161 146,454 112,498 Use of tax losses not previously recognized - - 11,176 Other amounts 125,453 (39,981) 36,717 628,322 1,304,176 287,066 Income tax and social contribution recorded in income for the period (913,940) 664,911 (201,009) Actual rate 20.15% (35.36%) 14.00% (l) As mentioned in Note 24 c.3, for investment subsidies not to be considered within the taxable income, they must be recorded as tax incentive reserves, to be used only to offset losses or increase capital. The subsidiary TIM Celular has tax benefits (SUDENE/SUDAM) which comply with these rules. |
33. Earnings per share
33. Earnings per share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings per share attributed to the Company's shareholders (in R$ per share) | |
Earnings per share | 33. Earnings per share (a) Basic Basic earnings per share are calculated by dividing income attributable to shareholders of the Company by the weighted average number of shares issued during the tax year. 2019 2018 2017 Income attributable to shareholders of the Company 3,622,127 2,545,101 1,234,507 Weighted average number of common shares issued (thousands) 2,420,481 2,420,172 2,420,016 Basic earnings per share (expressed in R$) 1.50 1.05 0.51 (b) Diluted Diluted earnings per share are calculated by adjusting the weighted average number of shares outstanding to assume the conversion of all dilutive potential shares. 2019 2018 2017 Income attributable to shareholders of the Company 3,622,127 2,545,101 1,234,507 Weighted average number of common shares issued (thousands) 2,421,018 2,421,075 2,421,072 Diluted earnings per share (expressed in R$) 1.50 1.05 0.51 The calculation of the diluted earnings per share considered 537 thousand shares (903 thousand shares in 2018) related to the granting of Plan 2011-2013, and granting of the 2014-2016 Plan, as mentioned in Note 25. |
34. Balances and transactions w
34. Balances and transactions with related parties | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of transactions between related parties [abstract] | |
Balances and transactions with related parties | 34. Balances and transactions with related parties The consolidated balances of transactions with companies of the Telecom Italia Group are as follows: Assets 2019 2018 Telecom Italia Sparkle (1) 1,949 2,877 TI Sparkle (3) 2,007 804 TIM Brasil (4) 5,429 13,993 Gruppo Havas (6) - 75,600 Other 1,035 1,092 Total 10,420 94,366 Liabilities 2019 2018 Telecom Italia S.p.A. (2) 80,825 89,433 Telecom Italia Sparkle (1) 6,531 11,895 TI Sparkle (3) 3,731 4,174 TIM Brasil (4) 6,056 6,044 Vivendi Group (5) 1,164 4,745 Gruppo Havas (6) 11,049 62,686 Other 2,467 107 Total 111,823 179,084 Revenue 2019 2018 2017 Telecom Italia S.p.A. (2) 775 858 665 Telecom Italia Sparkle (1) 5,371 5,809 5,281 TI Sparkle (3) 2,052 904 692 Total 8,198 7,571 6,638 Costs/Expenses 2019 2018 2017 Telecom Italia S.p.A. (2) 93,188 62,976 8,440 Telecom Italia Sparkle (1) 24,914 30,123 26,775 TI Sparkle (3) 18,700 18,035 30,734 Generali (7) - - 3,254 Vivendi Group (5) 1,386 9,439 16,361 Gruppo Havas (6) 264,318 301,752 127,730 Others 18,713 - 3,102 Total 421,219 422,325 216,396 (1) Ultimate parent company. These amounts refer to roaming, VAS, assignment of means and international voice data – wholesale, according to the contractual conditions between the parties. (2) These amounts refer to international roaming, technical post-sales assistance and VAS. On May 17, 2018, TIM Participações and Telecom Itália signed a licensing agreement on the use of a registered trademark and formally granted to TIM Participações and its subsidiary the right to use the “TIM” trademark against the payment of royalties of 0.5% of the company’s net revenues. The payment is made on a quarterly basis. (3) The amounts refer to the leasing of links and EILD, lease of means (submarine cables) and signaling services according to the contractual conditions between the parties. (4) Direct controller of the Company. Amounts refer mainly to judicial deposits made due to labor claims. (5) Shareholder of TIM S.p.A. The figures refer to value added services - VAS. (6) The amounts described above, in the income, refer to advertising services, of which R$ 172,956 (R$ 232,492 in 2018) are related to media transfers (7) The amounts refer to insurance coverage taken out for operating risks, civil liability and health insurance, among others. The balance sheet account balances are recorded in the following groups: trade accounts receivable, prepaid expenses, suppliers and other current assets and liabilities. The Company engages in social investment actions that include donations, projects developed by the TIM Institute and sponsorships. In 2019, the Company invested R$4,207 (R$ 4,637 in 2018) with its own resources in social benefit. |
35. Management remuneration
35. Management remuneration | 12 Months Ended |
Dec. 31, 2019 | |
Management Remuneration [Abstract] | |
Management remuneration | 35. Management remuneration Key Management personnel includes the statutory officers and the Board of Directors. The compensation of key Management personnel for services rendered is shown below: 2019 2018 Short-term benefits 22,524 23,556 Long-term benefits 900 3,351 Share-based payments remuneration 5,379 10,230 28,803 37,137 |
36. Financial instruments and r
36. Financial instruments and risk management | 12 Months Ended |
Dec. 31, 2019 | |
Financial Instruments And Risk Management [Abstract] | |
Financial instruments and risk management | 36. Financial instruments and risk management The financial instruments registered by the Company and its subsidiary include derivatives, which are financial liabilities measured at fair value through profit or loss. At each balance sheet date they are measured at their fair value. Interest, monetary adjustments, exchange variations and variations arising from measurement at fair value, where applicable, are recognized in income as they are incurred, under financial income or expenses. Derivatives are initially recognized at fair value as at the date of the derivative agreement and subsequently revised to fair value. The method used to recognize any gain or loss depends on whether or not the derivative is assigned as a hedge instrument in cases where hedge accounting is adopted. Through its subsidiary, the Company performs non-speculative derivative transactions, to: i) reduce the exchange variation risks, and ii) manage exposure to the interest risks involved. The Company’s derivative financial transactions consist specifically of swap contracts. The Company’s financial instruments are presented, through its subsidiary, in compliance with IFRS 9. The major risk factors to which the Company and its subsidiary are exposed are as follows: (i) Exchange variation risks Exchange variation risks refer to the possibility of the subsidiary incurring: i) losses on unfavorable exchange rate fluctuations, which would increase the outstanding balances of borrowing and financing taken in the market along with the related cost expenses, or ii) an increase in the cost of commercial agreements affected by exchange variations. In order to reduce this kind of risk, the subsidiary enters into swap contracts with financial institutions for the purpose of avoiding the impact of foreign exchange fluctuations on the financial results, and trade agreements containing sections that provide for foreign exchange bands with the purpose of partially reducing exchange rate risks, or US Dollar stock options intended to reduce foreign exchange exposure risks in business contracts. As at December 31, 2019, the borrowing and financing of the subsidiary indexed to foreign currency were fully hedged by swap contracts in terms of time and amount. Any gains or losses arising from these swap contracts are recorded in the results of the subsidiary. Besides the risks mentioned above, no other significant financial assets and liabilities are indexed to foreign currencies. (ii) Interest rate risks Interest rate risks relate to: - The possibility of variations in the fair value of TJLP and/or TLP-indexed financing taken by the subsidiary, when these rates are not proportional to the CDI rate. As at December 31, 2019, the subsidiary had no swap transactions linked to the TJLP and/or TLP. - The possibility of unfavorable changes in interest rates would result in higher finance costs for the subsidiary due to the indebtedness and the obligations assumed by the subsidiary under the swap contracts indexed to floating interest rates (CDI percentage). However, as at December 31, 2019, the subsidiary’s financial funds were invested in CDIs and this considerably reduces this risk. (iii) Credit risk inherent to providing services The risk involves the possibility of the subsidiary factoring in losses arising from the inability of subscribers to pay the invoiced amounts. To keep this risk to a minimum, the subsidiary undertakes preventive credit analyses of all orders placed by the sales areas while monitoring the accounts receivable from subscribers, blocking their ability to use the services, among other actions, in the event that the customers do not pay their debts. There were no customers contributing more than 10% of the net accounts receivable as at December 31, 2019 and 2018 or revenue from services rendered. (iv) Credit risk inherent to sales of handsets and prepaid phone cards The policy of the Group regarding the sale of handsets and the distribution of prepaid phone cards is directly related to the levels of credit risk accepted during the normal course of business. The selection of partners, the diversification of the accounts receivable portfolio, monitoring loan conditions, positions and order limits established for the traders and the constitution of real guarantees are among the procedures adopted by the subsidiaries to reduce possible problems in collecting from their commercial partners. There are no customers that have accounted for more than 10% of the receivables from the sale of goods during the period ending in December 2019 and 2018. The Company had one customer that accounted for more than 10,6 % of the net trade accounts receivable from the sale of goods as at December 31, 2019. (v) Liquidity risk - Liquidity risk arises from the need for cash to meet the Company's obligations. The Company structures the maturity dates of its non-derivative financial instruments and of its respective derivative financial instruments so as not to affect liquidity. - The Company’s liquidity and cash flow management is performed on a daily basis in order to ensure that the operating cash generation and prior funding, whenever necessary, are sufficient to maintain its schedule of operational and financial commitments. - All financial investments of the Company have daily liquidity, and Management may, in specific cases: i) review the dividend payment policy, ii) issue new shares, and/or iii) sell assets in order to improve liquidity. (vi) Financial credit risk The cash flow estimate is made and aggregated by the Finance and Treasury department of the Company. This department monitors the continuous liquidity requirements estimate to ensure that the Company has sufficient cash to meet its operating needs. This estimate takes into account investment plans, debt financing, compliance with contractual clauses, compliance with internal goals and, if applicable, compliance with regulatory, external or legal requirements. This risk relates to the possibility of the Company and its subsidiary incurring losses due to difficulties in realizing their short-term investments and swap contracts due to bankruptcy of the counterparties. The subsidiary minimizes the risk associated with these financial instruments by operating only with sound financial institutions and adopting policies that establish maximum risk concentration levels per institution. Fair value of derivative financial instruments The consolidated derivative financial instruments are shown as follows: 2019 2018 Assets Liabilities Net Assets Liabilities Net Transactions involving derivatives 46,511 (4,405) 42,106 81,408 (11,618) 69,790 Current portion 16,602 (858) 15,744 50,769 (2,373) 48,396 Non-current portion 29,909 (3,547) 26,362 30,639 (9,245) 21,394 The consolidated financial derivative instruments with long-term maturities as at December 31, 2019 were as follows: Assets Liabilities 2021 8,096 (709) 2022 8,096 (709) 2023 onwards 13,717 (2,129) 29,909 (3,547) Non-derivative financial liabilities mainly represent suppliers, dividends payable and other obligations maturing in the next 12 months, except for borrowing and financing and financial leases, whose nominal payment flows are disclosed in Notes 19 and 15. Consolidated financial assets and liabilities valued at fair value: 2019 Level 1 Level 2 Total Total assets 658,328 46,511 704,839 Financial assets valued at fair value 658,328 46,511 704,839 Derivatives used for hedging purposes - 46,511 46,511 Securities 658,328 - 658,328 Total liabilities - 4,405 4,405 Financial liabilities valued at fair value through profit or loss - 4,405 4,405 Derivatives used for hedging purposes - 4,405 4,405 2018 Level 1 Level 2 Total Total assets 790,070 81,408 871,478 Financial assets valued at fair value 790,070 81,408 871,478 Derivatives used for hedging purposes - 81,408 81,408 Securities 790,070 - 790,070 Total liabilities - 11,618 11,618 Financial liabilities valued at fair value through profit or loss - 11,618 11,618 Derivatives used for hedging purposes - 11,618 11,618 The fair value of financial instruments traded on active markets is based on quoted market prices as at the balance sheet date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. These instruments are included in Level 1. The instruments included in Level 1 mainly comprise investments in CDBs and repurchases classified as trading securities. The fair value of financial instruments that are not traded on an active market (for example, over-the-counter derivatives) is determined using valuation techniques. These valuation techniques maximize the use of observable market data when available and rely to the minimum extent possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2. If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3. Specific valuation techniques used to value financial instruments include: · Quoted market prices or financial institutions quotes or dealer quotes for similar instruments. · The fair value of interest rate swaps is calculated as the present value of the estimated future cash flow based on observable yield curves. · Other techniques, such as discounted cash flow analysis, are used to determine fair value for the remaining financial instruments. The fair values of derivative financial instruments of the subsidiaries were determined based on the future cash flow (asset and liability position), taking into account the contracted conditions and bringing this flow to its present value by means of the discounted future interest rates disclosed in the market. The fair values were estimated at a specific time, based on the information available and on the Company’s own valuation methodologies. Financial instruments by category The Company’s financial instruments by category can be summarized as follows: December 31, 2019 Measured at amortized cost Fair value through profit or loss Total Assets, per balance sheet 6,769,032 704,839 7,473,872 Derivative financial instruments - 46,511 46,511 Trade accounts receivable and other accounts receivable, excluding prepayments 3,287,855 - 3,287,855 Marketable securities - 658,328 658,328 Cash and cash equivalents 2,284,810 - 2,284,810 Leasing 156,378 - 156,379 Judicial deposits 1,006,899 - 1,006,899 Other assets to offset 33,090 - 33,090 Measured at amortized cost Fair value through profit or loss Total 14,310,830 4,405 14,315,235 Liabilities per balance sheet Borrowing and financing 2,029,088 - 2,029,088 Derivative financial instruments - 4,405 4,405 Suppliers and other obligations, excluding legal obligations 3,923,035 - 3,923,035 Leasing 7,780,870 - 7,780,870 Dividends payable 577,837 577,837 December 31, 2018 Measured at amortized cost Fair value through profit or loss Total Assets per balance sheet 5,639,420 871,478 6,510,898 Derivative financial instruments - 81,408 81,408 Trade accounts receivable and other accounts receivable, excluding prepayments 2,969,116 - 2,969,116 Marketable securities - 790,070 790,070 Cash and cash equivalents 1,075,530 - 1,075,530 Leasing 208,049 - 208,049 Judicial deposits 1,345,113 - 1,345,113 Other assets to offset 41,612 - 41,612 Measured at amortized cost Fair value through profit or loss Total Liabilities per balance sheet 8,296,570 11,618 8,308,188 Borrowing and financings 1,663,017 - 1,663,017 Derivative financial instruments - 11,618 11,618 Suppliers and other obligations, excluding legal obligations 4,323,374 - 4,323,374 Leasing 1,940,074 - 1,940,074 Dividends payable 370,105 - 370,105 The regular purchases and sales of financial assets are recognized as at the trade date - the date on which the Company undertakes to buy or sell the asset. Investments are initially recognized at fair value. After initial recognition, changes in the fair value are booked in income for the year as finance income and expenses. Financial risk hedge policy adopted by the Company – Synthesis The Company’s policy states that mechanisms must be adopted to hedge against financial risks arising from borrowing in foreign currency, so as to manage the exposure to the risks associated with exchange variations. Derivative financial instruments hedging against exchange variations must be acquired simultaneously with the closing of the debt that gave rise to that exposure. The coverage level for this exchange exposure is 100% of the risk, both in terms of maturity date and amount. As at December 31, 2019, no types of margins or collateral applied to the Company’s or the subsidiary’s transactions involving derivative financial instruments. The criteria for choosing the financial institutions abide by parameters that take into account the rating provided by reliable risk analysis agencies, shareholders’ equity and concentration levels of transactions and funding. The transactions involving derivative financial instruments entered into by the subsidiaries and outstanding as at December 31, 2019 and 2018 are shown in the table below: December 31, 2019 COUNTERPARTY % Coverage AVERAGE SWAP RATE Currency SWAP Type DEBT SWAP Total Debt Total Swap Asset Side Liability Side USD LIBOR X DI KFW/ Finnvera JP Morgan e BOFA 330,217 330,217 100% LIBOR 6M + 0.75% p.a. 85,50% do CDI USD PRE X DI CISCO Santander e JP Morgan 40,366 40,366 100% 2.50% p.a. 84,50% do CDI December 31, 2018 COUNTERPARTY % Coverage AVERAGE SWAP RATE Currency Swap type Debt SWAP Total Debt Total Swap Asset Side Liability Side USD LIBOR X DI KfW JP Morgan 43,420 43,420 100% LIBOR 6M + 1.35% p.a. 102.50% of CDI USD LIBOR X DI KFW/ Finnvera JP Morgan and BOFA 378,595 393,387 100% 100% LIBOR 6M + 0.75% p.a. 85,50% of CDI USD PRE X DI CISCO Santander and JP Morgan 116,466 116,466 100% 2.18% p.a. 88,20% of CDI In August 2018, the Company purchased US Dollar call options in the amount of US$100 million, with a strike price of R$4.00, in order to reduce the effects of foreign exchange variations on business contracts. The options were divided into nine maturity brackets worth US$11.1 million each (October 2018 to June 2019), and they were purchased for the initial amount of R$11.7 million, taking into account a reference spot price of R$3.7655 upon purchase. Due to the increase in US Dollar rates and a reduction in the risk exposure of business contracts, the Company settled the installments maturing in October 2018 and November 2018 in advance, for the price of R$5.6 million, considering a reference spot price of 4.157 at the time of the sale. In November 2018, considering the close maturity dates and the reduced risk exposure in commercial agreements, the Company settled in advance those maturing in December 2018 and in January and February 2019 in the amount of R$1.0 million. The options remaining matured on June 15, 2019. The Company did not have options transactions on December 31. Position showing the sensitivity analysis – effect of variations in the fair value of the swaps In order to identify possible distortions arising from consolidated derivative financial instrument transactions currently outstanding, a sensitivity analysis was carried out taking into account three different scenarios (probable, possible and remote) and their respective impacts on the results, as follows: Description 2019 Probable Scenario Possible Scenario Remote Scenario Debt in USD (Cisco and KFW) 381,178 381,178 474,450 567,104 A) ∆ Aggregate debt variation 93,272 185,926 Fair value of the asset side of the swap 381,178 381,178 474,450 567,104 Fair value of the liability side of the swap (338,971) (338,971) (337,647) (336,387) Swap result 42,207 42,207 136,803 230,717 B) ∆ Aggregate swap variation 94,596 188,510 C) Final result (B-A) (1,324) (2,584) Given the characteristics of the derivative financial instruments of the subsidiaries, the Company's assumptions basically took into account the effects of: i) the variation in the CDI, ii) the variation of the LIBOR rate, and iii) the variation in the US Dollar rate used in the transactions, achieving, respectively, the percentages and quotations indicated below: Risk variable Probable scenario Possible scenario Remote scenario (current) CDI 4.40% 5.50% 6.60% LIBOR 1.91% 2.39% 2.87% USD 4.0307 5.0384 6.0461 As the subsidiaries hold derivative financial instruments to hedge their respective financial debt, the variations in the scenarios are monitored from the respective subject of the hedge, thereby showing that the counterpart of the effects involving the exposure created by the swaps will be reflected in the debt. In the case of these transactions, the subsidiaries disclosed the fair value of the subject matter (debt) and the derivative financial instrument of the hedge in separate lines, as shown in the sensitivity analysis position above, so as to reveal the net exposure of its subsidiaries in each of the three scenarios mentioned. Attention is drawn to the fact that the sole purpose of the transactions entered into by the subsidiaries involving derivative financial transactions is to protect their balance sheet positions. Therefore, any improvement or deterioration in their respective market values will represent an inverse movement in the corresponding installments of the financial debt contracted, which is the subject matter of the subsidiaries’ derivative financial instruments. Sensitivity analyses referring to the derivative financial instruments outstanding as at December 31, 2019 were conducted basically taking into account the assumptions surrounding the variations in market interest rates and the variation of the US Dollar used in the swap agreements. The use of those assumptions in the analyses was exclusively due to the characteristics of the derivative financial instruments, which represent exposure to interest rate and exchange variations only. Position showing gains and losses with derivatives in the period 2019 Net income from USD vs. CDI transactions 5,077 Capital management The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns to shareholders and benefits to other stakeholders, in addition to maintaining an optimal capital structure to reduce the cost of capital. In order to maintain or adjust its capital structure the Company can review its policy on paying dividends, returning capital to the shareholders or issuing new shares or selling assets to reduce its level of indebtedness, for example. The Financial Leverage Index as at December 31, 2019 and December 31, 2018 can be summarized as below: 2019 2018 Balances with Adjustments Balances without IFRS 16 IFRS 16 Total borrowings and financings and derivatives (Note 19 and 36) 1,986,982 - 1,986,982 1,593,227 Lease - Liabilities (Note 15) 7,780,870 (6,196,068) 1,584,802 1,940,074 Lease - Assets (Note 15) (156,378) - (156,379) (208,049) Less: Cash and cash equivalents (Note 4) (2,284,810) - (2,284,810) (1,075,530) FIC (Note 5) (654,479) - (654,479) (784,841) Net Debt 6,672,185 (6,196,068) 476,116 1,464,881 EBITDA (1) (last 12 months) - Standardized 9,643,838 (1,315,684) 8,328,153 6,371,844 Financial Leverage Index - Unaudited 0.69 4.71 0.06 0.23 (1) Reconciliation to Net Income for the year: Adjusted Net Income 3,622,127 143,076 3,765,203 2,545,101 Depreciation and amortization 5,128,981 (940,144) 4,188,837 3,954,321 Net financial income (21,210) (592,323) (613,533) 537,333 Income tax and social contribution 913,940 73,706 987,646 (664,911) EBITDA (1) 9,643,838 (1,315,685) 8,328,153 6,371,844 (1) EBITDA: Earnings before interest, tax, depreciation and amortization (not an accounting metric) Changes in financial liabilities Changes in liabilities due to financing activities, such as borrowing and financing, financial leasing and financial instruments are presented below: Borrowing and financing Financial leasing Derivative financial instruments (assets) liabilities December 31, 2018 1,663,017 1,940,074 (69,790) Adoption of IFRS 16 - 5,256,114 - Inflows 1,000,000 1,834,914 - Financial expenses 167,998 821,463 9,068 Foreign exchange variations, net 18,222 - (14,145) Payments (820,149) (1,585,712) 32,761 Remeasurement IAS 17 (i) / IFRS16 - (485,983) - December 31, 2019 2,029,088 7,780,870 (42,106) (i) As mentioned in Note 2.f, the Company decided to adopt the pronouncement IFRS 16 – Lease, retroactively with the effect of the application as at January 1, 2019. Therefore, the lease previously classified as a financial lease, using IAS 17, the book value of the right-of-use asset and of the lease liability on the date of initial application of the standard, comprised the book value of the lease asset and of the lease liability immediately prior to the application of this new standard, in accordance with IAS 17. However, for such leases, as determined by the new standard, the Company is required to become to measure the right-of-use asset and the lease liability as from the initial application based on the new standard. Thus, the lease previously measured in accordance with IAS 17 was remeasured as at March 31, 2019, specifically with respect to the exclusion of variable lease payments that depend on an index or a rate, given that the projected inflation took into account for the period of the agreements previously measured in accordance with IAS 17. |
37. Defined benefit pension pla
37. Defined benefit pension plans and other post-employment benefits | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of defined benefit plans [abstract] | |
Defined benefit pension plans and other post-employment benefits | 37. Defined benefit pension plans and other post-employment benefits 2019 2018 PAMEC/ asset policy and medical plan 5,782 2,850 ICATU, SISTEL and FUNCESP The Company has been sponsoring a private pension plan with defined benefits for a group of employees from the former TELEBRÁS system under the administration of the Fundação Sistel de Seguridade Social – SISTEL and of ICATU Multi-sponsored fund. In addition to the plans coming from the Telebrás System, there is also a plan managed by Fundação CESP resulting from the merger of AES Atimus. The pension plans mentioned, as well as the medical plans, are briefly explained below: PBS Assisted (PBS-A Tele Celular Sul and PBS-A Tele Nordeste Celular) PBS (PBS Tele Celular Sul and PBS Tele Nordeste Celular) Management Agreement: PAMEC/Asset Policy: AES Telecom: Medical Plan Fiber: We present below the actuarial position of liabilities and assets related to the retirement and health care plans, as of December 31, 2019, according to the rules established by IAS 19: (a) Effects as of December 31: Plans Totals PBS PBS Assisted Management agreement PAMEC/Asset Policy AES Telecom Medical Plan 2019 2018 Reconciliation of assets and liabilities as of 12/31/19 (*) (*) (*) Present value of actuarial liabilities 40,427 10,107 151 1,080 11,099 2,585 65,449 52,206 Fair value of plan assets (43,991) (13,527) (425) - (8,982) - (66,925) (68,768) Present value of obligations in excess of fair value of assets (3,564) (3,420) (274) 1,080 2,117 2,585 (1,476) (16,562) Net actuarial liabilities / (assets) (3,564) (3,420) (274) 1,080 2,117 2,585 (1,476) (16,562) (*) No assets were recognized by the sponsors, due to the impossibility of reimbursement of this surplus, and the sponsor's contributions will not be reduced in the future. (b) Movement in net actuarial liabilities (assets) Plans PBS PBS Assisted Management agreement PAMEC/Asset Policy AES Telecom Medical Plan Actuarial Liabilities (Assets) at 12/31/18 (14,964) (4,209) (239) 884 102 1.864 Expenditure (revenue) recognized in income (1,394) (391) (22) 81 100 283 Sponsor Contributions - - - (47) - (26) Recognized actuarial (gains) or losses 12,794 1,180 (13) 162 1,915 464 Unrecognized actuarial gains or losses - - - - - - Net actuarial liabilities (assets) as of 12/31/19 (3,564) (3,420) (274) 1,080 2,117 2,585 (c) Reconciliation of the present value of the obligations Plans PBS PBS Assisted Management agreement PAMEC/Asset Policy AES Telecom Medical Plan Value of liabilities at 12/31/18 32,767 8,285 156 884 8,250 1,864 Cost of current service 5 - - - 93 108 Interest on actuarial liability 2,932 738 14 81 770 175 Benefits paid in the year (2,629) (719) (9) (47) (348) (27) Contributions paid by participants - - - - 57 - (Gains)/losses on liabilities 7,352 1,803 (10) 162 2,277 465 Value of liabilities at 12/31/19 40,427 10,107 151 1,080 11,099 2,585 (d) Reconciliation of fair value of assets Plans PBS PBS Assisted Management agreement PAMEC/Asset Policy AES Telecom Medical Plan Fair value of assets at 12/31/18 47,731 12,494 395 - 8,148 - Benefits paid in the year (2,629) (719) (9) - (348) - Effective return on assets in the year 4,326 1.128 36 - 763 - Actuarial gain (loss) on plan assets (5,437) 624 3 - 361 - Contributions paid by participants - - - - 58 - Sponsor contributions poured into the plan - - - - - Fair value of assets at 12/31/19 43,991 13,527 425 - 8,982 - (e) Expenditure planned for 2020 Plans PBS PBS Assisted Management agreement PAMEC/Asset Policy AES Telecom Medical Plan Current service cost (with interest) 15 - - - 125 150 Interest on actuarial liabilities 2,650 658 10 72 774 179 Expected return on assets (2,893) (888) (29) - (627) - Interest on the effect of the (asset)/ liability limit 243 230 19 - - - Total net expense (income) to be recognized 15 - - 72 272 329 Actuarial assumptions adopted in the calculations The main actuarial assumptions adopted in the calculations were the following: Nominal discount rate of the actuarial liability: PBS South: 6.81% / 3.20%; PBS Northeast: 6.83% / 3.22%; MA: 6.85% / 3.24%; PBS-A: 6.75% / 3.14%; AES: 7.09% / 3.47%; PAMEC: 6.77% / 3.16%; FIBER: 6.96% / 3.34% Nominal wage growth rate: PBS e MA: Not Applicable MA and PBS-A: Not Applicable; AES: 5.57%/ 2.00%; PAMEC and FIBER: Not Applicable Biometric general mortality table: PBS, MA and PBS-A: AT-2000 segregated by sex, softened by 10%; Biometric disability entry table: PBS: Álvaro Vindas; MA, PBS-A and PAMEC: Not Applicable; AES and FIBER: Mercer Disability; Expected rate of turnover: PBS, MA, PBS-A and PAMEC: Nula AES and FIBER: 0.15/(time of service + 1), being null and void as from 50 years Probability of entry into retirement: PBS and FIBER: 100% in 1st eligibility; MA: Not Applicable; AES: 3% per year between the first age of eligibility for early retirement and eligibility for normal retirement; MA, PBS-A and PAMEC: Not Applicable Estimated long-term inflation rate PAMEC and FIBER: 7.64% / 3.25% Calculation method Projected Unit Credit Method |
38. Insurance
38. Insurance | 12 Months Ended |
Dec. 31, 2019 | |
Insurance [Abstract] | |
Insurance | 38. Insurance The Company and its subsidiary have a policy for monitoring the risks inherent in their operations. Accordingly, as at December 31, 2019, the Company and its subsidiary had insurance coverage against operating risks, third-party liability and health, among others. The Management of the Company and of its subsidiary consider that the insurance coverage is sufficient to cover eventual losses. The table below shows the main assets, liabilities or interests insured and their respective amounts: Types Amount Insured Operating risk R$ 32,274,029 General Liability - RCG R$ 80,000 Cybernetic risks (cyber) R$ 28,520 Vehicles (executive and operational fleets) R$1,000 for civil liability optional (property damages and personal injury) and R$100 for moral damages. |
39. Subsequent Events
39. Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of non-adjusting events after reporting period [abstract] | |
Subsequent Events | 39. Subsequent Events Financing agreement with Banco do Nordeste do Brasil On January 31, 2020, the Company's wholly-owned subsidiary signed a financing agreement with Banco do Nordeste do Brasil, in the total amount of R$752,479: (i) R$325,071 at IPCA cost + 1.4386% and subject to a 15% default bond; and, (ii) R$427,408 at IPCA cost + 1.7582% and subject to a 15% default bond. The purpose of the facility is to finance Capex in the Northeast and North of the states of Minas Gerais and Espírito Santo from 2019 to 2022 with a total payment term of 8 years, being 3 grace years and 5 years of amortization. The operation will be guaranteed by (i) a bank guarantee proportional to 100% of the amount of each disbursement; and (ii) a bond of receivables proportional to 5% of the amount of each disbursement. To date, there were no disbursements. Preliminary negotiations regarding Oi Mobile On March 10, 2020, TIM Participações S.A. and its wholly-owned subsidiary TIM S.A., pursuant to Article 157 of Law 6,404 and the provisions of CVM Instruction 358, jointly inform its shareholders, the general market and other interested parties that: TSA jointly with TELEFÔNICA BRASIL S.A. (VIVO) expressed to Bank of America Merrill Lynch (“BofA”), Oi Group’s financial advisor, their interest in initiating negotiations targeting a potential joint acquisition of Oi Group's mobile business, in whole or in part, so that, in the event of the completion of the operation, each of the interested parties will receive a portion of that business. The interest in the transaction arises from the perspective that this, if materialized, will add value to the Company, generating benefits for its customers and shareholders, by accelerating its growth, increasing operational efficiency and quality of service. Additionally, the eventual conclusion of the operation would bring benefits to the telecommunications market in general, reinforcing its competitiveness and investment capacity. CVM approves category “A” registration request of TIM S.A. On March 18, 2020, TIM PARTICIPAÇÕES SA and its wholly-owned subsidiary, TIM SA, following the Material Fact published on October 28, 2019, communicate to their shareholders, to the market in general and to the other interested parties that TSA received on March 17, 2020, Official Letter-RIC No. 4/2020/CVM/SEP informing about the granting of registration as a publicly-held company in category “A” before the CVM (without offering securities), pursuant to CVM Instruction 480/09. The Company and TSA point out that there was no application Partnership between TIM Brasil and Banco C6 On March 26, 2020, TIM S.A. and BANCO C6 S.A., jointly called “Partners”, concluded the negotiations regarding a strategic partnership with the objective of developing combined offers with special benefits for the Partners’ customer bases. For the first time, digital banking and telecommunications services are joined in a single proposition. The agreement also provides for the possibility of exploring sales and payment channels synergies, expanding the distribution of offers and optimizing costs. The Partners highlight the innovative character of the agreement they concluded, which is centered on delivering convenience through the integration of essential services to customers’ daily lives. This approach offers a great value creation potential for both companies through client base growth and higher customer loyalty. In this context, TIM wants to position itself ahead of the market, creating a competitive differentiation factor based on innovation and service offerings. This agreement does not create a joint venture, therefore, TIM maintains the independence of its operations. However, depending on the evolution of the results of this partnership, TSA will become a minority shareholder in C6 through an objective-based compensation mechanism. The Company will keep its shareholders and the market informed in accordance with the regulations in force. Credit Agreement On April 7, 2020, due to global macroeconomic uncertainty regarding COVID-19 and its possible impacts, TIM S.A. executed a new credit agreement with The Bank of Nova Scotia in the amount of R$574 million denominated in U.S. dollars, guaranteed by TIM Participações. The cost post-hedge is 155.0% and disbursement occurred on April 22, 2020, with a one year maturity. COVID 19 In December 2019, an outbreak of a contagious disease, the Coronavirus Disease 2019 (COVID-19), began in mainland China and has since beginning of 2020, the virus spread through Europe, the US and various other countries, including Brazil. The COVID-19 outbreak has developed rapidly in 2020 and measures taken to contain the virus have affected economic activity, which in turn may have implications on the Company's results of operations and cash flows. Although the COVID-19 existed at December 31, 2019, it is the severity of the virus and the responses to the outbreak which may have an impact on the entity's operations occurred post December 31, 2019. The Company analyzed IAS10 considerations for purpose of this subsequent event in order to conclude if COVID-19 outbreak could present any impact in year-end financial statements figures or if it would only be a disclosure requirement for Company’s financial statements. The Covid-19 events arose after the reporting period and not predictable by the Company or any also other market participants, as such the outbreak is a non-adjusting event for the reporting period ending December 31, 2019 and no adjustment needs to be made to amounts recognized in the consolidated financial statements ended on December 31, 2019. Based on all information available as at December 31st, 2019, it was not foreseeable the COVID-19 could result a risk over the Company’s consolidated balance sheets and the consolidated statements of income. The Company is complying with the health and safety protocols established by the authorities and agencies is monitoring the development of the situation and closely evaluating the impact of the COVID-19 on its business. The COVID-19 pandemic and its potential impact on general commercial activity and the global economy may reduce demand from our clients on the more expensive plans or certain services (e.g. roaming) or even lead to plan cancellations or increased default, while it may lead to disruptions in our logistic chain, in our suppliers’ production or deliveries or in our ability to deliver our products (such as new devices or SIM cards) or to service our network on a timely basis, which may have a material adverse effect on our business and results of operations. At this time, we have not suffered any material impact to our operations. While it is too early for us to predict the impacts on our business or our financial targets of the expanding pandemic and the governmental responses to it, we would be materially adversely affected by a protracted downturn in local, regional or global economic conditions. |
3. Estimates and areas where _2
3. Estimates and areas where judgment is significant in the application of the Company's accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Estimates And Areas Where Judgment Is Significant In The Application Of The Company'S Accounting Policies [Abstract] | |
Impairment losses on non-financial assets | (a) Impairment losses on non-financial assets Losses due to impairment take place when the book value of an asset or cash generating unit exceeds its respective recoverable value, which is considered as the fair value less costs to sell and/or the value in use, whichever is greater. The calculation of the fair value less costs to sell is based on information available from sales transactions involving similar assets or market prices, less additional costs that would be incurred to dispose of those assets. The value in use is based on the discounted cash flow model. Any reorganization activities to which the Company has not yet committed itself on the financial statements disclosure date, or any material future investments aimed at improving the asset base of the cash generating unit being tested, are excluded for the purpose of impairment testing. The main non-financial assets valued this way were goodwill based on the future profitability recorded by the Company (Note 14) and its tangible assets. |
Income tax and social contribution (current and deferred) | (b) Income tax and social contribution (current and deferred) Income tax and social contribution (current and deferred) are calculated in accordance with interpretations of the legislation currently in force and IAS 12. This process normally includes complex estimates to define the taxable income and temporary differences. In particular, deferred tax assets on income tax and social contribution losses and temporary differences are recognized to the extent that it is probable that future taxable income will be available and can be offset. The measurement of the recoverability of deferred income tax and social contribution losses carry-forward and of temporary differences takes into account the history of taxable income, as well as estimates of future taxable income (Note 10). |
Provision for legal and administrative proceedings | (c) Provision for legal and administrative proceedings Legal and administrative proceedings are analyzed by the Company’s Management and internal and external legal advisors. The Company’s review takes into account factors such as the hierarchy of laws, case law available, recent court decisions, their relevance to the legal order, as well as payment history. Such reviews involve Management’s judgment (Note 23). |
Fair value of derivatives and other financial instruments | (d) Fair value of derivatives and other financial instruments Financial instruments presented at fair value in the balance sheet are measured using evaluation techniques that take into account observable data or observable data derived from the market (Note 36). |
Unbilled revenue | (e) Unbilled revenue Considering that some billing cut-off dates occur on intermediate dates within the months, at the end of each month there will be revenue already earned by the Company but not effectively billed to the customers. This unbilled revenue is recorded based on estimates which take into account data on usage, the number of days since the last billing date, among other factors (Note 26). |
Leasing | (f) Leasing The Company has a significant number of lease agreements in which it is the lessee, whereby with the adoption of accounting standard IFRS 16 – Leasing, as disclosed in Note 2.f., the Company’s Management made certain judgments when measuring the lease liability and the right-of-use assets, such as: (i) an estimation of the lease term, considering a non-cancelable period and the periods covered by options to extend the lease term, where such exercise depends only on the Company and is reasonably certain; (ii) use of certain assumptions to calculate the discount rate. The Company is not able to readily determine the interest rate implicit in the lease and therefore considers its incremental rate on loans to measure lease liabilities. The incremental rate is the interest rate that the Company would have to pay when borrowing, for a similar term and with similar collateral, the resources necessary to obtain the asset with similar value to the asset with similar right of use in a similar economic environment. Therefore, this assessment requires management to consider estimates when no observable rates are available. Or when they need to be adjusted to reflect the terms and conditions of a lease. The Company estimates the incremental rate using observable data (such as market interest rates) when available and considers in this estimate aspects that are specific to the Company (such as the cost of the subsidiary's debt). The Company´s average incremental rate is 10.55% for an average lease term as described in note 13. |
2. Basis for preparation and _2
2. Basis for preparation and disclosure of the consolidated financial statements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Basis For Preparation And Disclosure Of The Consolidated Financial Statements [Abstract] | |
Schedule of effects of the adoption of new accounting pronouncement | The table below presents the principal effects of the adoption of IFRS16 in the opening balances as at January 1, 2019. Originally reported Adjustments Balances under IFRS 16 Jan 1 st Jan 1 st Assets 31,957,889 5,256,114 37,214,003 Current assets 5,998,126 (8,742) 5,989,384 Trade accounts receivable 2,838,808 - 2,838,808 Inventories 183,059 - 183,059 Prepaid expenses (a) 272,060 (8,742) 263,318 Other assets 2,704,199 2,704,199 Non-current assets 25,959,763 5,264,856 31,224,619 Long-term receivables 4,074,137 (471) 4,073,666 Trade accounts receivable 130,308 130,308 Prepaid expenses (a) 74,381 (471) 73,910 Other assets 3,869,448 3,869,448 Property, plant and equipment (b) 11,203,622 5,265,327 16,468,949 Intangible assets 10,682,004 10,682,004 Liabilities and Shareholders’ Equity 31,957,889 5,256,114 37,214,003 Total Liabilities 12,163,052 5,256,114 17,419,166 Current Liabilities 7,075,379 785,065 7,860,444 Financial leasing (c) 205,048 785,065 990,113 Other liabilities 6,870,331 6,870,331 Non-Current Liabilities 5,087,673 4,471,049 9,558,722 Financial leasing (c) 964,289 4,471,049 5,435,338 Deferred income tax and social contribution - - Other Liabilities 4,123,384 4,123,384 Shareholders’ Equity 19,794,837 - 19,794,837 Capital stock 9,866,298 9,866,298 Revenue reserves 9,928,539 9,928,539 During the fiscal year ended December 31, 2019, the new accounting standards had the following impact on the income statement: Statements of income Balances without Adjustments Balances with IFRS 16 IFRS 16 Net revenue from services 16,597,155 - 16,597,155 Net revenue from products 780,039 - 780,039 Net revenue 17,377,194 - 17,377,194 Cost of services provided and goods sold (a), (d) (4,494,914) 1,193,407 (3,301,507) 12,882,280 1,193,407 14,075,687 (4,554,127) 122,278 (4,431,849) Operating income (expenses) Selling expenses (e) (4,800,325) 70,935 (4,729,390) General and administrative expenses (f) (1,029,343) 51,343 (978,000) Other revenues (expenses), net 1,275,541 - 1,275,541 8,328,153 1,315,685 9,643,838 Depreciation and amortization (g) (4,188,837) (940,144) (5,128,981) Financial income (expenses) 613,533 (592,323) 21,210 Income before income and social contribution taxes 4,752,849 (216,782) 4,536,067 Income and social contribution taxes (h) (987,646) 73,706 (913,940) Net income for the year 3,765,203 (143,076) 3,622,127 There is no material impact on other comprehensive results or basic diluted earnings per share. Statement of Cash Flows Balances without Adjustments Balances with IFRS 16 IFRS 16 Net income for the period before income tax and social contribution 4,752,850 (216,783) 4,536,067 Adjustments to reconcile net income to net cash generated by activities Lease interest payable 229,139 592,324 821,463 Depreciation and amortization 4,188,837 940,144 5,128,981 Net cash from operations 5,749,042 1,315,684 7,064,726 Net cash invested in investment activities (3,721,742) - (3,721,742) Net cash used in financing activities (827,120) (1,315,684) (2,142,804) Increase in cash and cash equivalents 1,209,280 - 1,209,280 Cash and cash equivalents at the beginning of the year 1,075,530 - 1,075,530 Cash and cash equivalents at the end of the year 2,284,810 - 2,284,810 The principal adjustments arising from the new standard are as follows: (a) Reclassification of the agreement for reciprocal assignment with consideration for fiber optic infrastructure previously classified as prepaid expenses (Note 11) for property, plant and equipment – right-of-use under lease; (b) Recognition of the asset – right-of-use under lease of the lease payments eligible for the new standard; (c) Increase in the Company’s net debt due to the recognition of the lease liability as required by the standard; (d) Leasing – infrastructure (network, land and fiber optics); (e) Leasing – stores & kiosks and vehicles; (f) Leasing – administrative buildings and vehicles; (g) Recognition of the depreciation of the assets mentioned above; (h) Tax impact on the adjustments from the new standard. |
4. Cash and cash equivalents (T
4. Cash and cash equivalents (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Cash and cash equivalents [abstract] | |
Schedule of financial assets | The Company’s Management determines the classification of its financial assets upon initial recognition. 2019 2018 Cash and banks 101,928 93,960 Unrestrictedly available financial investments: CDBs/Repurchases 2,182,882 981,570 2,284,810 1,075,530 |
5. Marketable securities (Table
5. Marketable securities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Marketable Securities [Abstract] | |
Schedule of marketable securities | 2019 2018 FUNCINE (3) 3,849 5,229 Fundo Soberano (4) 7,329 14,472 FIC: (1) Government securities 179,390 292,708 Repo transactions (2) 216,196 289,352 Financial bills 105,857 96,868 Other (5) 145,707 91,441 658,328 790,070 Current portion (654,479) (784,841) Non-current portion 3,849 5,229 (1) (2) (3) (4) (5) |
6. Trade accounts receivable (T
6. Trade accounts receivable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Trade Accounts Receivable [Abstract] | |
Schedule of trade account receivables | A portion of the accounts receivable from clients is used to secure the total amount of BNDES borrowing (Note 19). 2019 2018 Trade accounts receivable 3,287,855 2,969,116 Gross accounts receivable 4,061,932 3,656,044 Billed services 2,076,569 1,733,229 Unbilled services 858,418 774,484 Network use (interconnection) 438,168 455,228 Sale of goods 670,573 691,312 Contractual asset (note 22) 15,142 130 Other accounts receivable 3,062 1,661 Provision for expected credit losses (774,077) (686,928) Current portion (3,184,780) (2,838,808) Non-current portion 103,075 130,308 |
Schedule of changes in the allowance for doubtful accounts | Change in provision for expected credit losses, recorded as an asset reducing account, were as follows: 2019 2018 Opening balance 686,928 464,745 Setup of provision (note 27) 748,291 544,881 Impact of adopting IFRS 9 - 130,137 Write-off of provision (661,142) (452,835) Final Balance 774,077 686,928 |
Schedule of aging of accounts receivable | The aging of accounts receivable is as follows: 2019 2018 Total 4,061,932 3,656,044 Falling due 2,576,307 2,459,315 Overdue up to 30 days 328,457 308,744 Overdue up to 60 days 146,200 144,309 Overdue up to 90 days 149,852 117,759 Invoices overdue more than 90 days 861,116 625,917 |
7. Inventory (Tables)
7. Inventory (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory [Abstract] | |
Schedule of inventory | Inventories are stated at average acquisition cost. A loss is recognized to adjust the cost of handsets and accessories to their net realizable value (selling price) when this amount is less than the average acquisition cost. 2019 2018 Total inventories 203,278 183,059 Inventory 214,889 189,826 Mobile handsets and tablets 146,295 145,819 Accessories and prepaid cards 61,436 33,621 TIM chips 7,158 10,386 Losses on adjustment to realizable amount (11,611) (6,767) |
8. Indirect taxes, charges an_2
8. Indirect taxes, charges and contributions recoverable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Indirect Taxes, Charges And Contributions Recoverable [Abstract] | |
Schedule of indirect taxes, charges and contributions recoverable | 2019 2018 Indirect taxes, charges and contributions recoverable 1,243,633 1,192,765 ICMS 1,201,502 1,152,741 Others 42,131 40,024 Current portion (420,284) (280,254) Non-current portion 823,349 912,511 |
9. Direct taxes, charges and _2
9. Direct taxes, charges and contributions recoverable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Direct Taxes, Charges And Contributions Recoverable [Abstract] | |
Schedule of direct taxes, charges and contributions recoverable | 2019 2018 Direct taxes, charges and contributions recoverable 3,762,800 905,521 Income tax (IR) and social contribution (CS) (i) 428,443 414,408 PIS / COFINS (ii) 3,244,549 384,093 Others 89,808 107,020 Current portion (1,395,193) (347,505) Non-current portion 2,367,607 558,016 |
10. Deferred income tax and s_2
10. Deferred income tax and social contribution (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Income Tax And Social Contribution [Abstract] | |
Schedule of deferred taxes assets and liabilities | The amounts recorded are as follows: 2019 2018 Losses carried forward – income tax and social contribution 800,711 896,100 Temporary differences: Provision for legal and administrative proceedings 295,853 293,349 Losses from doubtful accounts 271,611 244,428 Adjustments to present value – 3G license 7,182 9,124 Deferred income tax on accounting adjustments 56,208 58,268 Lease of LT Amazonas infrastructure 27,434 24,978 Profit sharing 23,704 22,181 Taxes with suspended enforceability 12,872 12,872 Amortized goodwill – TIM Fiber (370,494) (370,494) Derivative financial instruments (13,139) (22,551) Capitalized interest on 4G authorization (291,783) (301,525) Deemed costs – TIM S.A. (67,748) (82,042) Exclusion of ICMS from PIS and COFINS calculation bases (1,023,928) - IFRS16 Lease 209,234 - Other 87,214 74,821 24,931 859,509 Unrecognized deferred income tax and social contribution Taxes with suspended enforceability (72,665) (57,538) (47,734) 801,971 Deferred tax assets portion - 801,971 Deferred tax liabilities portion (47,734) - |
Schedule of expectations to recover the credits | Based on these projections, the Company expects to recover the credits as follows: Deferred income tax and social contribution 2020 229,151 2021 275,425 2022 296,135 2023 - Tax losses and negative base 800,711 Temporary differences (848,445) Total (47,734) |
11. Prepaid expenses (Tables)
11. Prepaid expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Prepaid Expenses [Abstract] | |
Schedule of prepaid expenses | 2019 2018 245,524 346,441 Advertising not released (1) 854 76,651 Rentals and insurance 75,809 78,005 Network Swap (2) - 11,449 Incremental costs for obtaining customer contracts (3) 158,093 173,056 Others 10,768 7,280 Current portion (175,868) (272,060) Non-current portion 69,656 74,381 (1) Represents the early payment of expenses from the advertising of TIM brand’s products and services, which were recognized in income for the period during which the advertising was broadcast. (2) On April 1, 2010, the subsidiary TIM S.A. and GVT entered into an onerous contract and a reciprocal agreement for the assignment of fiber optic infrastructure (network swap), in order to expand their respective areas of operation. Given the economic nature of the transaction, the amount was recognized in the (current and non-current) prepaid expenses and deferred revenue (current and non-current) and is amortized to income according to the contract’s term. This contract is within the scope of IFRS 16. Therefore, it was reclassified to right-of-use in leases under property, plant and equipment, as shown in Note 2.f. (3) This is mainly represented by incremental costs related to sales commissions paid to sales agents in order to obtain customer contracts arising from the adoption of IFRS 15, which are deferred to income according to the term and/or economic benefit of the contract, which is usually two years. |
12. Judicial deposits (Tables)
12. Judicial deposits (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Judicial Deposits [Abstract] | |
Schedule of detailed information about judicial deposits | These are recorded at their historical costs and updated according to the legislation in force: 2019 2018 1,006,899 1,345,113 Civil 355,093 334,028 Labor 245,928 492,000 Tributary 203,110 299,310 Regulatory 111 111 Online attachment (*) 202,657 219,664 (*) Refers to blocked judicial deposits directly on the Company´s bank accounts and financial investments related to certain judicial proceedings. This amount is analyzed periodically and, when identified, is reclassified to one of the other specific accounts of judicial deposits. |
13. Property, plant and equip_2
13. Property, plant and equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, plant and equipment [abstract] | |
Schedule of changes in property, plant and equipment | Balance for Dec/18 Adoption of IFRS 16 Additions Disposals Transfers Other changes (*) Balance for Dec/19 Total cost of property, plant and equipment, gross 33,832,803 5,256,114 4,855,684 (183,384) - (408,118) 43,353,099 Commutation/transmission equipment 20,806,249 - 17,662 (133,789) 2,121,907 - 22,812,029 Fiber optic cables 762,175 - - - 51,414 - 813,589 Leased handsets 2,313,945 - 519 (20,194) 195,725 - 2,489,995 Infrastructure (i) 6,133,810 - - (18,684) 294,851 (313,130) 6,096,847 Informatics assets 1,679,328 - - (9,366) 51,289 - 1,721,251 General use assets 796,839 - - (623) 63,289 - 859,505 Rights-of-use in leases (ii) (Note 2.f) - 5,256,114 1,772,290 - - (94,988) 6,933,416 Land 40,794 - - - - - 40,794 Construction in progress 1,299,663 - 3,065,213 (728) (2,778,475) - 1,585,673 Total of Accumulated depreciation (22,629,181) - (3,262,726) 150,972 - - (25,740,935) Commutation/transmission equipment (14,936,069) - (1,577,490) 129,998 - - (16,383,561) Fiber optic cables (345,532) - (65,035) - - - (410,567) Leased handsets (2,132,227) - (131,341) 6,705 - - (2,256,863) Infrastructure (i) (3,157,890) - (440,224) 4,281 - - (3,593,833) Informatics assets (1,512,114) - (62,561) 9,366 - - (1,565,309) General use assets (545,349) - (45,931) 622 - - (590,658) Right-of-use in leases (ii) (Note 2.f) - - (940,144) - - - (940,144) Total property, plant and equipment, net 11,203,622 5,256,114 1,592,958 (32,412) - (408,118) 17,612,164 Commutation/transmission equipment 5,870,180 - (1,559,828) (3,791) 2,121,907 - 6,428,468 Fiber optic cables 416,643 - (65,035) - 51,414 - 403,022 Leased handsets 181,718 - (130,822) (13,489) 195,725 - 233,132 Infrastructure (i) 2,975,920 - (440,224) (14,403) 294,851 (313,130) 2,503,014 Informatics assets 167,214 - (62,561) - 51,289 - 155,942 General use assets 251,490 - (45,931) (1) 63,289 - 268,847 Rights-of-use in leases (ii) (Note 2.f) - 5,256,114 832,146 - - (94,988) 5,993,272 Land 40,794 - - - - - 40,794 Construction in progress 1,299,663 - 3,065,213 (728) (2,778,475) - 1,585,673 Balance for Dec/17 Additions/ Depreciation Disposals Transfers Balance for Dec/18 Total cost of property, plant and equipment, gross 31,166,905 2,746,039 (80,141) - 33,832,803 Commutation/transmission equipment 18,766,840 8,974 (48,203) 2,078,638 20,806,249 Fiber optic cables 683,971 20 - 78,184 762,175 Leased handsets 2,181,630 - (15,675) 147,990 2,313,945 Infrastructure 5,652,840 678 (4,562) 484,854 6,133,810 Informatics assets 1,615,325 9 (9,511) 73,505 1,679,328 General use assets 739,439 286 (2,018) 59,132 796,839 Land 40,794 - - - 40,794 Construction in progress 1,486,066 2,736,072 (172) (2,922,303) 1,299,663 - Total Accumulated depreciation (20,328,417) (2,371,362) 70,598 - (22,629,181) Commutation/transmission equipment (13,373,003) (1,610,326) 47,260 - (14,936,069) Fiber optic cables (290,699) (54,833) - - (345,532) Leased handsets (2,016,018) (124,709) 8,500 - (2,132,227) Infrastructure (2,697,878) (463,856) 3,844 - (3,157,890) Informatics assets (1,448,694) (72,885) 9,465 - (1,512,114) General use assets (502,125) (44,753) 1,529 - (545,349) Total property, plant and equipment, net 10,838,488 374,677 (9,543) - 11,203,622 Commutation/transmission equipment 5,393,837 (1,601,352) (943) 2,078,638 5,870,180 Fiber optic cables 393,272 (54,813) - 78,184 416,643 Leased handsets 165,612 (124,709) (7,175) 147,990 181,718 Infrastructure 2,954,962 (463,178) (718) 484,854 2,975,920 Informatics assets 166,631 (72,876) (46) 73,505 167,214 General use assets 237,314 (44,467) (489) 59,132 251,490 Land 40,794 - - - 40,794 Construction in progress 1,486,066 2,736,072 (172) (2,922,303) 1,299,663 The construction in progress represent the cost of projects in progress related to the construction of networks and/or other tangible assets in the period of their construction and installation, until the moment they come into operation, when they will be transferred to the corresponding accounts of these assets. (*) Other changes include: (i) In 2019, the "Sale of Towers (leaseback)" lease had its value remeasured for better alignment with the methodology of the new IFRS 16, based on paragraph C11 of this new pronouncement and removed the projected inflation component on future receipts, in the amount of R$ 313,130. (ii) In the fourth quarter of 2019, the Company implemented a new tool that allowed Management to control and calculate in an automated manner the accounting effects arising from lease agreements. Through this new tool, it was possible to identify adjustments in the amount of R$94,988 of these assets (note 2). Lease operation - network Lease operation - vehicles Lease operation – Stores & kiosks Lease operation - Property Lease operation – Land (Network) Total Balances as at January 01, 2019 2,625,145 6,792 375,286 1,540,685 708,206 5,256,114 Additions in the period, net of cancellation 928,682 5,045 191,597 322,067 324,899 1,772,290 Remensuration 5,841 (500) 5,895 (138,967) 32,743 (94,988) Depreciation (387,526) (4,349) (93,306) (183,872) (271,091) (940,144) Balances as at December 31, 2019 3,172,142 6,988 479,472 1,539,913 794,757 5,993,272 Useful Life - % 10.98 44.81 21.04 11.97 31.25 |
Schedule of depreciation rates | Annual Rate % Commutation/transmission equipment 8 to 14.29 Fiber optic cables 4 to 10 Leased assets 14.28 to 50 Infrastructure 4 to 20 Informatic assets 10 to 20 General use assets 10 to 20 |
14. Intangible assets (Tables)
14. Intangible assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of detailed information about intangible assets [abstract] | |
Schedule of movement in intangible assets | Balance for Dec/18 Additions/ Amortization Transfers Other Changes (g) Balance for Dec/19 Total cost of intangible assets, gross 29,366,779 961,213 - (98,633) 30,229,359 Right to use software 17,142,641 - 1,041,741 - 18,184,382 Authorizations 7,638,970 26,968 2,255,625 (109,770) 9,811,793 Goodwill 1,527,219 - - - 1,527,219 Right to use infrastructure - LT Amazonas 198,202 - - (28,874) 169,328 Other assets 307,654 - 19,708 - 327,362 Intangible assets under development 2,552,093 934,245 (3,317,074) 40,011 209,275 Accumulated amortization (18,684,775) (1,876,258) - - (20,561,033) Right to use software (13,681,086) (1,412,080) - - (15,093,166) Authorizations (4,845,642) (432,771) - - (5,278,413) Right to use infrastructure - LT Amazonas (52,441) (7,763) - - (60,204) Other assets (105,606) (23,644) - - (129,250) Total intangible assets, net 10,682,004 (915,045) - (98,633) 9,668,326 Right to use software (c) 3,461,555 (1,412,080) 1,041,741 - 3,091,216 Authorizations 2,793,328 (405,803) 2,255,625 (109,770) 4,533,380 Goodwill (d) 1,527,219 - - - 1,527,219 Right to use infrastructure - LT Amazonas (e) 145,761 (7,763) - (28,874) 109,124 Other assets 202,048 (23,644) 19,708 - 198,112 Intangible assets under development (f) 2,552,093 934,245 (3,317,074) 40,011 209,275 Balance Dec/17 Additions/ Amortization Transfers Disposals Capitalized interest Balance for Dec/18 Total cost of intangible assets, gross 28,549,552 1,139,993 (479,811) (1,270) 158,315 29,366,779 Right to use software 15,957,808 - 1,186,103 (1,270) - 17,142,641 Authorizations 6,391,394 94,148 1,153,428 - - 7,638,970 Goodwill 1,527,219 - - - - 1,527,219 Costs with commissions to deferred sales representatives 384,455 - (384,455) - - - List of clients 95,200 - (95,200) - - - Right to use infrastructure - LT Amazonas 198,202 - - - - 198,202 Other assets 270,687 - 36,967 - - 307,654 Intangible assets under development 3,724,587 1,045,845 (2,376,654) - 158,315 2,552,093 Accumulated amortization (17,237,025) (1,799,914) 350,894 1,270 - (18,684,775) Right to use software (12,265,391) (1,416,965) - 1,270 - (13,681,086) Authorizations (4,497,758) (347,884) - - - (4,845,642) Costs with commissions to deferred sales representatives (255,694) - 255,694 - - - List of clients (95,200) 95,200 - - - Right to use infrastructure - LT Amazonas (42,531) (9,910) - - - (52,441) Other assets (80,451) (25,155) - - - (105,606) Total intangible assets, net 11,312,527 (659,921) (128,917) - 158,315 10,682,004 Right to use software (c) 3,692,417 (1,416,965) 1,186,103 - - 3,461,555 Authorizations 1,893,636 (253,736) 1,153,428 - - 2,793,328 Goodwill (d) 1,527,219 - - - - 1,527,219 Costs with commissions to deferred sales representatives (Note 11.3) 128,761 - (128,761) - - - Right to use infrastructure - LT Amazonas (e) 155,671 (9,910) - - - 145,761 Other assets 190,236 (25,155) 36,967 - - 202,048 Intangible assets under development (f) 3,724,587 1,045,845 (2,376,654) - 158,315 2,552,093 |
Schedule of amortization rates | Annual rate % Right to use software 20 Authorizations 5 to 50 Right to use infrastructure 5 Other assets 7 to 10 |
15. Financiale leases (Tables)
15. Financiale leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LT Amazonas [Member] | |
Disclosure of financial assets [line items] | |
Schedule of finance lease receivables | 2019 2018 LT Amazonas 156,378 208,049 156,378 208,049 Current portion (4,931) (22,491) Non-current portion 151,447 185,558 |
Schedule of finance lease receivables nominal and present value | It is worthwhile noting that these balances differ from those shown in the books since, in the case of the latter, the amounts are shown at their present value: Nominal amount Present Value January 2020 to December 2020 23,206 4,931 January 2021 to December 2024 92,826 58,081 January 2025 onwards 200,609 93,366 316,641 156,378 |
Schedule of finance lease liabilities | 2019 2018 LT Amazonas (i) 276,233 359,987 Sale of towers ( leaseback 1,192,596 1,501,695 Other (iv) 115,973 78,392 Subtotal 1,584,802 1,940,074 Other lease operations (Note 2.f) and (iii): - Lease– Network 3,294,261 - Lease – Vehicles 3,005 - Lease – Stores and kiosks 255,857 - Lease - Properties 243,921 - Lease - Land (network) 1,600,456 - Lease – Fiber 798,568 - Subtotal (IFRS 16) 6,196,068 - Total 7,780,870 1,940,074 Current portion (873,068) (205,048) Non-current portion 6,907,802 1,735,026 |
Schedule of finance lease liabilities nominal and present value | These balances differ from those shown in the books since, in the case of the latter, the amounts are shown at present value: Nominal amount Present value January 2020 to December 2020 44,079 8,451 January 2021 to December 2024 176,315 103,464 January 2025 onwards 381,161 164,318 601,555 276,233 |
Schedule of other lease operations | The balances differ from those shown in the books, since in the latter case the amounts are shown at present value: Up to December 2020 January 2021 to December 2024 January 2025 onwards Nominal amount Present values Total other lease operations 1,388,262 4,284,210 3,617,001 9,289,474 6,196,068 Lease operation - network 623,670 2,291,331 2,059,339 4.974341 3,294,261 Lease operation - vehicles 5,039 2,848 - 7,886 3,005 Lease operation – Stores & kiosks 82,958 174,338 52,426 309,721 255,857 Lease operation - Property 51,317 176,575 156,560 384,452 243,921 Lease operation – Land (Network) 298,389 1,035,594 1,348,676 2,682,660 1,600,456 Lease operation – Fiber 326,889 603,524 - 930,414 798,568 |
Sale of Towers (Leaseback) [Member] | |
Disclosure of financial assets [line items] | |
Schedule of finance lease liabilities nominal and present value | These balances differ from those shown in the books since, in the case of the latter, the amounts are shown at present value: Nominal amount Present value January 2020 to December 2020 44,079 8,451 January 2021 to December 2024 176,315 103,464 January 2025 onwards 381,161 164,318 601,555 276,233 |
17. Suppliers (Tables)
17. Suppliers (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Suppliers [Abstract] | |
Schedule of supplier accounts payable | They are initially recognized at fair value and subsequently measured at amortized cost using the effective interest rate method. Given the short maturity terms of these obligations, in practice they are usually recognized at the invoice value. 2019 2018 3,923,035 4,323,374 Local currency 3,769,298 4,158,599 Suppliers of materials and services (a) 3,667,152 4,027,092 Interconnection (b) 67,396 98,060 Roaming (c) 441 162 Co-billing (d) 34,309 33,285 Foreign currency 153,737 164,775 Suppliers of materials and services (a) 116,057 137,397 Roaming (c) 37,680 27,378 Current portion 3,923,035 4,323,374 (a) Represent the amounts to be paid to suppliers for acquisitions of materials and for the provision of services relating to tangible and intangible assets or for consumption in operations, maintenance and management, as provided for in the agreement between the parties. (b) This refers to the use of the networks of other landline and mobile telephone operators, with calls being initiated from TIM’s network and ending on the networks of other operators. (c) This refers to calls made by customers outside their registration area, who are therefore considered visitors to other operator networks. (d) This refers to calls made by a customer who has used another long-distance operator. |
18. Authorizations payable (Tab
18. Authorizations payable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Authorizations Payable [Abstract] | |
Schedule of licenses payables | As at December 31, 2019, the Company and its subsidiary had the following commitments to ANATEL: 2019 2018 Renewal of authorizations (i) 199,363 300,253 Updated ANATEL liability (ii) 126,974 113,547 326,337 413,800 Current portion (88,614) (65,464) Non-current portion 237,723 348,336 (i) In order to provide SMP services, the company obtained radio frequency authorizations for a fixed period, renewable for a further 15 years. The extension of the right-of-use includes the payment of 2% of the net revenue recorded in the regions covered by the authorization that ends every two years. As at December 31, 2019, the subsidiary had balance due related to the renewal of authorizations in the amount of R$199,363 (R$300,253 as at December 31, 2018). (ii) On December 05, 2014 the subsidiary signed an Authorization Instrument for the 700 MHz band and paid an amount equivalent to R$1,678 million, recording the remaining balance of R$61 million as a trade liability, according to the payment method provided for in the call notice. Due to the absence of bids for some lots in the Call Notice for the 700 MHZ band, the subsidiary, along with other bidders, had to bear a proportion of the costs of these lots. Thus, the EAD was organized, with respect to which the total commitment assumed by the subsidiary was R$1,199 million. This amount was paid in four installments adjusted by the IGP-DI (Daily General Price Index) (Note 14.f). |
Schedule of authorizations payable | The authorizations held on a primary basis by TIM S.A. as at December 31, 2019, as well as their maturity dates, are detailed below: Maturity date Authorization instruments 450 MHz 800 MHz, 900 MHz and 1,800 MHz Additional frequencies 1,800 MHz 1,900 MHz and 2,100 MHz (3G) 2,500 MHz V1 Band (4G) 2,500 MHz (P** Band (4G) 700 MHz (4G) Amapá, Roraima, Pará, Amazonas and Maranhão - March, 2031* April, 2023 April, 2023 October, 2027 Part of AR92 (PA) – February, 2024* December, 2029 Rio de Janeiro and Espírito Santo October, 2027 March, 2031* ES - April, 2023 April, 2023 October, 2027 Part of AR21 (RJ) – February, 2024* December, 2029 Acre, Rondônia, Mato Grosso, Mato Grosso do Sul, Tocantins, Distrito Federal, Goiás, Rio Grande do Sul (except the municipality of Pelotas and region) and the municipalities of Londrina and Tamarana, in Paraná PR - October, 2027 March, 2031* April, 2023 April, 2023 October, 2027 Part of AR61 (DF) – February, 2024* December, 2029 São Paulo - March, 2031* Countryside - April, 2023 April, 2023 October, 2027 - December, 2029 Paraná (except the municipalities of Londrina and Tamarana) October, 2027 September, 2022* April, 2023 April, 2023 October, 2027 AR41, except Curitiba and Metropolitan Region - February, 2024* AR41, Curitiba and Metropolitan Region - July, 2031 December, 2029 Santa Catarina October, 2027 September, 2023* April, 2023 April, 2023 October, 2027 - December, 2029 Municipality and region of Pelotas, in the State of Rio Grande do Sul - April, 2024* - April, 2023 October, 2027 - December, 2029 Pernambuco - May, 2024* - April, 2023 October, 2027 Part of AR81-July, 2031 December, 2029 Ceará - November, 2023* - April, 2023 October, 2027 - December, 2029 Paraíba - December, 2023* - April, 2023 October, 2027 - December, 2029 Rio Grande do Norte - December, 2023* - April, 2023 October, 2027 - December, 2029 Alagoas - December, 2023* - April, 2023 October, 2027 - December, 2029 Piauí - March, 2024* - April, 2023 October, 2027 - December, 2029 Minas Gerais (except the municipalities of the PGO sector 3 for 3G the radio frequencies and others) - April, 2028* April, 2023 April, 2023 October, 2027 Part of AR31 - February, 2030* December, 2029 Bahia and Sergipe - August, 2027* - April, 2023 October, 2027 - December, 2029 *Agreements already renewed for 15 years, and therefore TIM is not entitled to a further renewal period. ** Only complementary areas in some specific States. |
19. Borrowing and financing (Ta
19. Borrowing and financing (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Borrowings [abstract] | |
Schedule of appropriation of financial expenses | They are initially recognized at fair value, and subsequently measured based on the effective interest rate method. The appropriation of financial expenses based on the effective interest rate method is recorded in income, under financial expenses. Description Currency Charges Maturity Dec/2019 Dec/2018 BNDES (1) URTJLP TJLP to TJLP + 2,52 % p.a. Jul/22 240,008 578,312 BNDES (1) UM143 SELIC + 2.52% p.a. Jul/22 374,461 489,421 BNDES (PSI) (1) R$ 3.50% p.a. Jan/21 18,071 56,804 KFW (2) USD Libor 6M+ 1.35% p.a. Apr/19 - 43,420 KFW Finnvera (2) USD Libor 6M+ 0.75% p.a. Jan/24 to Dec/25 330,217 378,595 Debentures (2) R$ 104.1% of the CDI Jul/20 1,025,965 - Cisco Capital (3) USD 2.50% p.a. Dec/20 40,366 116,465 Total 2,029,088 1,663,017 Current (1,384,180) (698,728) Non-current 644,908 964,289 Guarantees: (1) Guaranteed by the holding company TIM Participações and collateral of some receivables of the subsidiary. (2) Guaranteed by the holding company TIM Participações. (3) No guarantee. |
Schedule of credit facilities | The table below sets forth the status of the financing and credit facilities available: Type Currency Date of opening Term Total amount Undrawn balance Amount used as at December 31, 2019 Amount expired until December 31, 2019 BNDES (1) TJLP May/18 Dec/19 1,090,000 - - 1,090,000 BNDES (2) TJLP May/18 Dec/19 20,000 - - 20,000 FINAME TLP Mar/19 Dec/20 390,000 390,000 - - Total R$ 1,500,000 390,000 - 1,110,000 Purpose: (i) Support for the TIM investment plan for the years 2017 to 2019 including, but not limited to, the acquisition of Brazilian equipment. (ii) Investment in social projects involving the community. (iii) Investment solely toward the purchase of machinery and equipment, industrial systems and/or other components manufactured in the country. |
Schedule of long term portions of borrowing and financing | The long-term portions of borrowing and financing as at December 31, 2019 mature as follows: 2021 305,171 2022 206,324 2023 33,434 2024 78,694 2025 21,285 644,908 |
20. Indirect taxes, charges a_2
20. Indirect taxes, charges and contributions payable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Indirect Taxes, Charges And Contributions Payable [Abstract] | |
Schedule of indirect taxes charges and contributions payable | 2019 2018 Indirect taxes, charges and contributions payable 466,603 453,941 Value added tax on goods and services - ICMS 377,105 361,558 ANATEL taxes and charges 22,009 21,320 ISS 61,673 59,764 Others 5,816 11,299 Current portion (463,606) (451,169) Non-current portion 2,997 2,772 |
21. Direct taxes, charges and_2
21. Direct taxes, charges and contributions payable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Direct Taxes, Charges And Contributions Payable [Abstract] | |
Schedule of direct taxes charges and contributions payable | Brazilian tax legislation allows companies to choose quarterly or monthly payments of income tax and social contribution. From 2016 onward, the Company chose to make monthly payments of income tax and social contribution. 2019 2018 Direct taxes, charges and contributions payable 508,615 542,213 Income tax and social contribution 346,097 372,467 PIS/COFINS 130,327 76,072 Other (*) 32,191 93,674 Current portion (296,305) (332,333) Non-current portion 212,310 209,880 (*) The composition of this account refers mainly to the subsidiary’s adherence to the Tax Recovery Program – REFIS, as of 2009. For installment payment of debts due on federal taxes (PIS, COFINS, IR and CSLL) whose final maturity will be on October 31, 2024. |
22. Deferred revenue (Tables)
22. Deferred revenue (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Revenues [Abstract] | |
Schedule of deferred revenue | 2019 2018 Deferred revenues 1,109,112 1,313,467 Prepaid services to be provided (1) 186,310 301,621 Government grants (2) 42,159 63,731 Network swap (3) 2,713 11,449 Anticipated receipts 11,651 18,626 Deferred revenue for sale of towers (4) 843,017 897,112 Contractual liability (5) 23,262 20,928 Current portion (281,930) (406,867) Non-current portion 827,182 906,600 (1) This refers to the reloading of voice and data credits not yet used by customers involving prepaid system services, which are appropriated to income when customers actually avail themselves of these services. (2) Refers to the release of funds under the credit facility from the BNDES Investment Sustainment Program. The total sum of the subsidies granted by the BNDES through December 31, 2019, was R$203 million and the amount outstanding at December 31, 2019 and R$42,159 (63,731 at December 31, 2018). This amount is being amortized according to the useful life of the asset being financed and appropriated to the “Other income (expenses), net” (Note 28). (3) Refers mainly to the transfer of onerous contracts and reciprocal fiber optic infrastructure (Note 11). (4) Refers to amounts to be appropriated from sales of towers (Note 15). (5) Contracts with customers. |
Schedule of contractual assets and liabilities | 2019 2018 Accounts receivable included in trade accounts receivable 2,413,865 2,189,931 Contractual asset (note 6) 15,142 130 Contractual liabilities (23,262) (20,928) |
Summary of the main changes during the fiscal year: | Summary of the main changes during the fiscal year: Contractual asset (liability) 2019 2018 Balances as at January 1, 2019 (20,798) (12,305) Additions 1,845 (23,545) Write-offs 10,833 15,052 Balances as at December 31, 2019 (8,120) (20,798) The estimated realization of the balances of contractual assets and liabilities is described below: 2020 2021 Contractual asset (liability) (5,953) (2,167) |
23. Provision for legal and a_2
23. Provision for legal and administrative proceedings (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Provision For Legal And Administrative Proceedings [Abstract] | |
Schedule of provision for legal and administrative proceedings | The updated provision set up for legal and administrative proceedings is made up as follows: 2019 2018 Provision for legal and administrative proceedings 840,637 849,408 Civil (a) 212,702 111,301 Labor (b) 261,837 435,438 Tax (c) 333,717 271,214 Regulatory (d) 32,381 31,455 |
Schedule of reconciliation of provision for legal and administrative proceedings | The changes in the provision for legal and administrative proceedings can be summarized as follows: Dec/2018 Additions, net of reversals Payments Monetary adjustment Dec/2019 849,408 547,691 (715,203) 158,741 840,637 Civil (a) 111,301 348,012 (335,640) 89,028 212,701 Labor (b) 435,438 96,235 (301,971) 32,136 261,838 Tax (c) 271,214 103,354 (77,341) 36,490 333,717 Regulatory (d) 31,455 90 (251) 1,087 32,381 Dec/2017 Additions, net of reversals Payments Monetary adjustment Dec/2018 528,320 551,191 (536,647) 306,544 849,408 Civil (a) 132,422 239,705 (324,803) 63,977 111,301 Labor (b) 184,311 225,864 (114,450) 139,713 435,438 Tax (c) 180,643 84,990 (96,346) 101,927 271,214 Regulatory (d) 30,944 632 (1,048) 927 31,455 |
Schedule of tax provision | 2019 2018 Federal taxes 155,495 82,033 State taxes 93,790 103,546 Municipal taxes 8,227 1,713 TIM S.A. proceedings (purchase price allocation) 76,205 83,922 333,717 271,214 |
Schedule of legal and administrative processes involving possible losses | No provision has been set up for these legal and administrative proceedings, and no materially adverse effects are expected on the financial statements, as shown below: 2019 2018 18,395,727 18,734,644 Civil (e.1) 1,032,637 1,046,521 Labor and social security (e.2) 459,020 523,236 Tax (e.3) 16,196,077 16,530,061 Regulatory (e.4) 707,993 634,826 |
Schedule of civil contingent liabilities | 2019 2018 Actions filed by consumers (e.1.1) 374,860 405,635 ANATEL (e.1.2) 220,526 207,657 Consumer Protection Agencies (e.1.3) 32,847 84,231 Former trade partners (e.1.4) 180,226 173,213 Social and environmental, and infrastructure (e.1.5) 125,201 71,574 Other (e1.6) 98,977 104,211 1,032,637 1,046,521 |
Schedule of tax contingent liabilities | 2019 2018 Federal taxes (e.3.1) 4,279,570 3,952,125 State taxes (e.3.2) 8,221,808 8,904,916 Municipal taxes (e.3.3) 703,132 693,616 FUST, FUNTTEL and EBC (e.3.4) 2,991,567 2,979,404 16,196,077 16,530,061 |
24. Shareholders' equity (Table
24. Shareholders' equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Shareholders' equity | |
Schedule of subscribed and paid up capital | The subscribed and paid up capital is represented as follows: 2019 2018 Net value paid up 9,866,298 9,866,298 Value paid up 9,913,415 9,913,415 (-) Funding costs (47,117) (47,117) Number of common shares 2,421,032,479 2,421,032,479 |
Schedule of reserves | The use of capital reserves is in accordance with the provisions of Article 200 of Law No. 6.404/76, which refers to corporate entities. These reserves consist of: 2019 2018 410,650 412,091 Special goodwill reserve 380,560 380,560 Stock options 30,090 31,531 |
Schedule of dividends calculation | As at December 31, 2019, dividends and interest on equity were calculated as shown below: 2019 2018 Net income for the year 3,622,127 2,545,101 (-) Tax incentives not to be distributed (194,161) (146,455) (-) Legal reserve constitution (171,398) (119,932) Revised profit 3,256,568 2,278,714 Minimum dividends calculated considering 25% of the revised profit 814,142 569,679 Breakdown of dividends payable and interest on equity: Interest on shareholders’ equity 995,438 849,994 Total dividends and interest on shareholders’ equity distributed and proposed 995,438 849,994 IRRF on interest on shareholders’ equity (149,316) (125,757) Total dividends and interest on shareholders’ equity, net 846,122 724,237 Dividends per share (amount in reais), net of IRRF 0.35 0.30 |
25. Long-term incentive plan (T
25. Long-term incentive plan (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Long-Term Incentive Plan [Abstract] | |
Schedule of variations in quantity of options | The variations in the quantity of shares/options are presented below: Date of grant Share options granted Maturity Date Exercise price Balance at beginning of 2019 financial year Granted in the period Exercised in the period Forfeited in the period Failing due in the period Balance at beginning of 2019 financial year 2018-2020 Plan - 2ª Grant 930,662 Jul/22 R$ 11.28 - 930,662 - (33,418) - 897,244 2018-2020 Plan – 1 st 849,932 Apr/21 R$ 14.41 466,514 - (115,949) (97,228) - 253,337 2014-2016 Plan – 3 rd 3,922,204 Nov/22 R$ 8.10 895,522 - (476,182) - - 419,340 2014-2016 Plan – 2 nd 3,355,229 Oct/21 R$ 8.45 292,523 - (159,675) - - 132,848 2014-2016 Plan – 1 st 1,687,686 Sep/20 R$ 13.42 531,972 - (32,511) (121,175) - 378,286 2011-2013 Plan – 3 rd 3,072,418 Jul/19 R$ 8.13 543,583 - - - (543,583) - 2011-2013 Plan – 2 nd 2,661,752 Sep/18 R$ 8.96 - - - - - - 2011-2013 Plan – 1 st 2,833,595 Aug/17 R$ 8.84 - - - - - - Total 19,313,478 2,730,114 930,662 (784,317) (251,821) (543,583) 2,081,055 Average weighted price for the period R$ 11.23 Date of grant Share options granted Maturity Date Exercise price Balance at beginning of 2018 financial year Granted in the period Exercised in the period Forfeited in the period Failing due in the period Balance at beginning of 2018 financial year 2018-2020 Plan – 1 st 849,932 May/20 14.41 - 849,932 (383,418) - 466,514 2014-2016 Plan – 3 rd 3,922,204 Nov/22 8.10 2,684,284 (510,884) (1,277,878) - 895,522 2014-2016 Plan – 2 nd 3,355,229 Oct/21 8.45 1,240,740 (656,268) (291,949) - 292,523 2014-2016 Plan – 1 st 1,687,686 Sep/20 13.42 658,720 (27,424) (99,324) - 531,972 2011-2013 Plan – 3 rd 3,072,418 Jul/19 8.13 694,936 (151,353) - 543,583 2014-2016 Plan – 2 nd 2,661,752 Sep/18 8.96 194,756 (194,756) - 2014-2016 Plan – 1 st 2,833,595 Aug/17 8.84 - - - Total 18,382,816 5,473,436 849,932 (1,194,576) (2,203,922) (194,756) 2,730,114 Average weighted price for the period 10.26 |
Schedule of significant data included in model | Below are the significant data included in the model: Date of grant Weighted average base price of shares during the vesting period of the grant Volatility Expected useful life of the option Annual interest rate without risk 2011 Grant R$ 8.84 51.73% p.a 6 years 11.94% p.a 2012 Grant R$ 8.96 50.46% p.a 6 years 8.89% p.a 2013 Grant R$ 8.13 48.45% p.a 6 years 10.66% p.a 2014 Grant R$ 13.42 44.60% p.a 6 years 10.66% p.a 2015 Grant R$ 8.45 35.50% p.a 6 years 16.10% p.a 2016 Grant R$ 8.10 36.70% p.a 6 years 11.73% p.a 2018 Grant R$ 14.41 NA 3 years NA 2019 Grant R$ 11.28 NA 3 years NA |
26. Net revenue (Tables)
26. Net revenue (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue [abstract] | |
Schedule of revenue | Similarly, certain contract compliance costs are also deferred to the extent that they relate to performance obligations under the customer agreement, i.e. when the customer obtains control over the asset. 2019 2018 2017 Net operational revenue 17,377,194 16,981,329 16,233,959 Gross operating revenue 25,182,831 24,232,404 22,611,074 Service revenue 23,820,343 23,065,648 21,433,515 Service revenue – Mobile 22,145,033 21,531,779 20,147,585 Service revenue – Landline 1,675,310 1,533,869 1,285,930 Goods sold 1,362,488 1,166,756 1,177,559 Deductions from gross revenue (7,805,637) (7,251,075) (6,377,115) Taxes (4,939,980) (5,163,797) (5,027,406)) Discounts given (2,843,670) (2,073,892) (1,329,600) Returns and other (21,987) (13,386) (20,109) |
27. Operating costs and expen_2
27. Operating costs and expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Operatings Costs And Expenses [Abstract] | |
Schedule of operating cost and expences | 2019 2018 Cost of services provided and goods sold Selling expenses General and administrative expenses Total Cost of services provided and goods sold (*) Selling expenses General and administrative expenses Total (7,433,731) (4,986,289) (1,717,859) (14,137,879) (7,701,418) (4,970,780) (1,608,319) (14,280,517) Personnel (53,392) (624,353) (392,984) (1,070,729) (36,514) (637,177) (357,878) (1,031,569) Third-party services (569,242) (2,041,646) (512,643) (3,123,531) (518,762) (2,169,624) (451,990) (3,140,376) Interconnection and means of connection (1,419,464) - - (1,419,464) (2,513,176) - - (2,513,176) Depreciation and amortization (4,132,223) (256,898) (739,860) (5,128,981) (3,119,954) (162,804) (671,562) (3,954,320) Taxes, fees and contributions (32,120) (817,369) (18,846) (868,335) (31,754) (866,197) (18,333) (916,284) Rent and insurance (291,302) (121,795) (20,590) (433,687) (591,226) (146,877) (67,387) (805,490) Cost of goods sold (931,818) - - (931,818) (883,912) - - (883,912) Publicity and advertising - (355,234) - (355,234) - (421,588) - (421,588) Losses on doubtful accounts - (748,291) - (748,291) - (544,881) - (544,881) Other (4,170) (20,703) (32,936) (57,809) (6,120) (21,632) (41,169) (68,921) 2017 Cost of services provided and goods sold Selling expenses General and administrative expenses Total (8,002,077) (4,575,177) (1,424,643) (14,001,897) Personnel (48,802) (602,578) (305,036) (956,416) Third-party services (544,036) (2,049,994) (429,597) (3,023,627) Interconnection and means of connection (2,632,593) - - (2,632,593) Depreciation and amortization (3,280,524) (162,020) (571,126) (4,013,670) Taxes, fees and contributions (36,625) (919,018) (11,963) (967,606) Rent and insurance (609,595) (92,363) (62,954) (764,912) Cost of goods sold (846,839) - - (846,839) Publicity and advertising - (410,982) - (410,982) Losses on doubtful accounts - (316,387) - (316,387) Other (3,063) (21,835) (43,967) (68,865) |
28. Other income (expenses), _2
28. Other income (expenses), net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Income (Expenses), Net [Abstract] | |
Schedule of other income (expenses), net | 2019 2018 2017 Income Subsidy income, net 21,572 25,305 28,722 Fines on telecommunications services 50,499 44,411 41,699 Revenue from disposal of assets 2,214 1,708 2,865 Other income (a) 1,878,558 282,041 171,273 1,952,843 353,465 244,559 Expenses FUST/FUNTTEL (b) (137,169) (143,167) (140,878) Taxes, fees and contributions (4,024) (4,092) (4,466) Provision for legal and administrative proceedings, net of reversal (466,460) (452,463) (366,476) Expenses from disposal of assets (7,055) (4,424) (6,618) Other expenses (62,593) (32,608) (24,831) (677,301) (636,754) (543,269) Other revenues (expenses), net 1,275,542 (283,289) (298,710) (a) The variation in the period refers to: (i) credits from legal proceedings held by the Company with a final decision in favor of the Company in higher courts in 2019, which discussed the exclusion of ICMS from the calculation base of PIS and COFINS contributions. The amount of R$ 1,795 million was recorded under other revenues in June 2019 (Note 9) and (ii) amortization of deferred revenue from the sale of the towers (Note 15). (b) Expenses incurred with contributions on several telecommunications revenue amounts due to ANATEL, according to the legislation in force. |
29. Financial income (Tables)
29. Financial income (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Financial Income [Abstract] | |
Schedule of financial income | 2019 2018 2017 Financial income 1,430,171 412,733 512,565 Interest on financial investments 88,224 119,548 369,517 Interest received from clients 37,233 36,793 38,227 Swap interest 15,536 17,001 32,300 Interest on leasing 20,528 25,664 22,709 Monetary adjustments (i) 1,263,793 207,191 39,694 Foreign exchange variation 4,857 6,536 10,118 (i) Includes the amount of R$1,228 million regarding the adjustment of credits from a legal proceeding of TIM Celular S.A. (absorbed by TIM S.A.) on the exclusion of ICMS from PIS and COFINS tax bases (Note 9). |
30. Financial expenses (Tables)
30. Financial expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Financial Expenses [Abstract] | |
Schedule of financial expenses | 2019 2018 2017 Financial expenses (1,408,053) (951,439) (1,009,653) Interest on borrowing and financing (116,735) (96,682) (211,108) Interest on taxes and fees (28,396) (15,409) (5,712) Swap interest (24,604) (32,424) (85,362) Interest on leasing (821,463) (266,328) (257,305) Monetary adjustment (2) (191,309) (340,175) (278,272) Discounted granted (36,047) (38,858) (52,683) Other expenses (1) (189,499) (161,563) 119,211 (1) (2) |
31. Foreign exchange variatio_2
31. Foreign exchange variations, net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Foreign Exchange Variations, Net [Abstract] | |
Schedule of foreign exchange variations, net | 2019 2018 2017 Revenue Borrowing and financing 22,494 1,409 287,777 Suppliers 9,004 6,844 4,124 Swap 40,742 75,340 130,971 Others 15,952 13,937 7,146 88,192 97,530 430,018 Expenses Borrowing and financing (40,715) (75,298) (271,286) Suppliers (13,201) (11,925) (6,819) Swap (22,493) (1,409) (147,356) Others (12,691) (7,525) (5,305) (89,100) (96,157) (430,766) Exchange variations, net (908) 1,373 (748) |
32. Income tax and social con_2
32. Income tax and social contribution (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax And Social Contribution [Abstract] | |
Schedule of income tax and social contribution | 2019 2018 2017 Current income and social contribution taxes Income tax for the year (155,521) (253,120) (203,932) Social contribution for the year (58,905) (92,502) (77,148) Tax incentive – SUDENE/SUDAM (l) 156,594 146,454 112,493 (57,832) (199,168) (168,587) Deferred income tax and social contribution Deferred income tax (625,516) 651,632 (23,976) Deferred social contribution (225,186) 217,501 (8,631) (850,702) 869,133 (32,607) Provision for income tax and social contribution contingencies (5,406) (5,054) 185 (856,108) 864,079 (32,422) (913,940) 664,911 (201,009) |
Schedule of income tax and social contribution expenses reconciliation | The reconciliation of income tax and social contribution expenses calculated at the applicable tax rates plus the amounts reflected in the statement of income is set forth below: 2019 2018 2017 Income before income tax and social contribution 4,536,066 1,880,190 1,435,516 Combined tax rate 34% 34% 34% Combined tax rate on income tax and social contribution (1,542,262) (639,265) (488,075) (Additions)/exclusions: Unrecognized/recognized tax losses and temporary differences (18,783) 920,745 68,716 Permanent additions and exclusions: Non-deductible expenses for tax purposes (10,958) (12,040) (6,638) Tax benefit related to interest on shareholders’ equity 338,449 288,998 64,597 Tax incentive (i) 194,161 146,454 112,498 Use of tax losses not previously recognized - - 11,176 Other amounts 125,453 (39,981) 36,717 628,322 1,304,176 287,066 Income tax and social contribution recorded in income for the period (913,940) 664,911 (201,009) Actual rate 20.15% (35.36%) 14.00% (l) As mentioned in Note 24 c.3, for investment subsidies not to be considered within the taxable income, they must be recorded as tax incentive reserves, to be used only to offset losses or increase capital. The subsidiary TIM Celular has tax benefits (SUDENE/SUDAM) which comply with these rules. |
33. Earnings per share (Tables)
33. Earnings per share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings per share attributed to the Company's shareholders (in R$ per share) | |
Schedule of earning per share | Basic earnings per share are calculated by dividing income attributable to shareholders of the Company by the weighted average number of shares issued during the tax year. 2019 2018 2017 Income attributable to shareholders of the Company 3,622,127 2,545,101 1,234,507 Weighted average number of common shares issued (thousands) 2,420,481 2,420,172 2,420,016 Basic earnings per share (expressed in R$) 1.50 1.05 0.51 Diluted earnings per share are calculated by adjusting the weighted average number of shares outstanding to assume the conversion of all dilutive potential shares. 2019 2018 2017 Income attributable to shareholders of the Company 3,622,127 2,545,101 1,234,507 Weighted average number of common shares issued (thousands) 2,421,018 2,421,075 2,421,072 Diluted earnings per share (expressed in R$) 1.50 1.05 0.51 |
34. Balances and transactions_2
34. Balances and transactions with related parties (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of transactions between related parties [abstract] | |
Schedule of consolidated balances of transactions | The consolidated balances of transactions with companies of the Telecom Italia Group are as follows: Assets 2019 2018 Telecom Italia Sparkle (1) 1,949 2,877 TI Sparkle (3) 2,007 804 TIM Brasil (4) 5,429 13,993 Gruppo Havas (6) - 75,600 Other 1,035 1,092 Total 10,420 94,366 Liabilities 2019 2018 Telecom Italia S.p.A. (2) 80,825 89,433 Telecom Italia Sparkle (1) 6,531 11,895 TI Sparkle (3) 3,731 4,174 TIM Brasil (4) 6,056 6,044 Vivendi Group (5) 1,164 4,745 Gruppo Havas (6) 11,049 62,686 Other 2,467 107 Total 111,823 179,084 Revenue 2019 2018 2017 Telecom Italia S.p.A. (2) 775 858 665 Telecom Italia Sparkle (1) 5,371 5,809 5,281 TI Sparkle (3) 2,052 904 692 Total 8,198 7,571 6,638 Costs/Expenses 2019 2018 2017 Telecom Italia S.p.A. (2) 93,188 62,976 8,440 Telecom Italia Sparkle (1) 24,914 30,123 26,775 TI Sparkle (3) 18,700 18,035 30,734 Generali (7) - - 3,254 Vivendi Group (5) 1,386 9,439 16,361 Gruppo Havas (6) 264,318 301,752 127,730 Others 18,713 - 3,102 Total 421,219 422,325 216,396 (1) Ultimate parent company. These amounts refer to roaming, VAS, assignment of means and international voice data – wholesale, according to the contractual conditions between the parties. (2) These amounts refer to international roaming, technical post-sales assistance and VAS. On May 17, 2018, TIM Participações and Telecom Itália signed a licensing agreement on the use of a registered trademark and formally granted to TIM Participações and its subsidiary the right to use the “TIM” trademark against the payment of royalties of 0.5% of the company’s net revenues. The payment is made on a quarterly basis. (3) The amounts refer to the leasing of links and EILD, lease of means (submarine cables) and signaling services according to the contractual conditions between the parties. (4) Direct controller of the Company. Amounts refer mainly to judicial deposits made due to labor claims. (5) Shareholder of TIM S.p.A. The figures refer to value added services - VAS. (6) The amounts described above, in the income, refer to advertising services, of which R$ 172,956 (R$ 232,492 in 2018) are related to media transfers (7) The amounts refer to insurance coverage taken out for operating risks, civil liability and health insurance, among others. |
35. Management remuneration (Ta
35. Management remuneration (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Management Remuneration [Abstract] | |
Schedule of key management personnel | Key Management personnel includes the statutory officers and the Board of Directors. The compensation of key Management personnel for services rendered is shown below: 2019 2018 Short-term benefits 22,524 23,556 Long-term benefits 900 3,351 Share-based payments remuneration 5,379 10,230 28,803 37,137 |
36. Financial instruments and_2
36. Financial instruments and risk management (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Financial Instruments And Risk Management [Abstract] | |
Schedule of consolidated derivative financial instruments | The consolidated derivative financial instruments are shown as follows: 2019 2018 Assets Liabilities Net Assets Liabilities Net Transactions involving derivatives 46,511 (4,405) 42,106 81,408 (11,618) 69,790 Current portion 16,602 (858) 15,744 50,769 (2,373) 48,396 Non-current portion 29,909 (3,547) 26,362 30,639 (9,245) 21,394 |
Schedule of long term maturities of financial derivative instruments | The consolidated financial derivative instruments with long-term maturities as at December 31, 2019 were as follows: Assets Liabilities 2021 8,096 (709) 2022 8,096 (709) 2023 onwards 13,717 (2,129) 29,909 (3,547) |
Schedule of consolidated financial assets and liabilities valued at fair value | Consolidated financial assets and liabilities valued at fair value: 2019 Level 1 Level 2 Total Total assets 658,328 46,511 704,839 Financial assets valued at fair value 658,328 46,511 704,839 Derivatives used for hedging purposes - 46,511 46,511 Securities 658,328 - 658,328 Total liabilities - 4,405 4,405 Financial liabilities valued at fair value through profit or loss - 4,405 4,405 Derivatives used for hedging purposes - 4,405 4,405 2018 Level 1 Level 2 Total Total assets 790,070 81,408 871,478 Financial assets valued at fair value 790,070 81,408 871,478 Derivatives used for hedging purposes - 81,408 81,408 Securities 790,070 - 790,070 Total liabilities - 11,618 11,618 Financial liabilities valued at fair value through profit or loss - 11,618 11,618 Derivatives used for hedging purposes - 11,618 11,618 |
Schedule of financial instruments by category | The Company’s financial instruments by category can be summarized as follows: December 31, 2019 Measured at amortized cost Fair value through profit or loss Total Assets, per balance sheet 6,769,032 704,839 7,473,872 Derivative financial instruments - 46,511 46,511 Trade accounts receivable and other accounts receivable, excluding prepayments 3,287,855 - 3,287,855 Marketable securities - 658,328 658,328 Cash and cash equivalents 2,284,810 - 2,284,810 Leasing 156,378 - 156,379 Judicial deposits 1,006,899 - 1,006,899 Other assets to offset 33,090 - 33,090 Measured at amortized cost Fair value through profit or loss Total 14,310,830 4,405 14,315,235 Liabilities per balance sheet Borrowing and financing 2,029,088 - 2,029,088 Derivative financial instruments - 4,405 4,405 Suppliers and other obligations, excluding legal obligations 3,923,035 - 3,923,035 Leasing 7,780,870 - 7,780,870 Dividends payable 577,837 577,837 December 31, 2018 Measured at amortized cost Fair value through profit or loss Total Assets per balance sheet 5,639,420 871,478 6,510,898 Derivative financial instruments - 81,408 81,408 Trade accounts receivable and other accounts receivable, excluding prepayments 2,969,116 - 2,969,116 Marketable securities - 790,070 790,070 Cash and cash equivalents 1,075,530 - 1,075,530 Leasing 208,049 - 208,049 Judicial deposits 1,345,113 - 1,345,113 Other assets to offset 41,612 - 41,612 Measured at amortized cost Fair value through profit or loss Total Liabilities per balance sheet 8,296,570 11,618 8,308,188 Borrowing and financings 1,663,017 - 1,663,017 Derivative financial instruments - 11,618 11,618 Suppliers and other obligations, excluding legal obligations 4,323,374 - 4,323,374 Leasing 1,940,074 - 1,940,074 Dividends payable 370,105 - 370,105 |
Schedule of derivative financial instruments outstanding | The transactions involving derivative financial instruments entered into by the subsidiaries and outstanding as at December 31, 2019 and 2018 are shown in the table below: December 31, 2019 COUNTERPARTY % Coverage AVERAGE SWAP RATE Currency SWAP Type DEBT SWAP Total Debt Total Swap Asset Side Liability Side USD LIBOR X DI KFW/ Finnvera JP Morgan e BOFA 330,217 330,217 100% LIBOR 6M + 0.75% p.a. 85,50% do CDI USD PRE X DI CISCO Santander e JP Morgan 40,366 40,366 100% 2.50% p.a. 84,50% do CDI December 31, 2018 COUNTERPARTY % Coverage AVERAGE SWAP RATE Currency Swap type Debt SWAP Total Debt Total Swap Asset Side Liability Side USD LIBOR X DI KfW JP Morgan 43,420 43,420 100% LIBOR 6M + 1.35% p.a. 102.50% of CDI USD LIBOR X DI KFW/ Finnvera JP Morgan and BOFA 378,595 393,387 100% 100% LIBOR 6M + 0.75% p.a. 85,50% of CDI USD PRE X DI CISCO Santander and JP Morgan 116,466 116,466 100% 2.18% p.a. 88,20% of CDI |
Schedule of sensitivity analysis of derivative financial instrument | In order to identify possible distortions arising from consolidated derivative financial instrument transactions currently outstanding, a sensitivity analysis was carried out taking into account three different scenarios (probable, possible and remote) and their respective impacts on the results, as follows: Description 2019 Probable Scenario Possible Scenario Remote Scenario Debt in USD (Cisco and KFW) 381,178 381,178 474,450 567,104 A) ∆ Aggregate debt variation 93,272 185,926 Fair value of the asset side of the swap 381,178 381,178 474,450 567,104 Fair value of the liability side of the swap (338,971) (338,971) (337,647) (336,387) Swap result 42,207 42,207 136,803 230,717 B) ∆ Aggregate swap variation 94,596 188,510 C) Final result (B-A) (1,324) (2,584) |
Schedule of risk variable of derivative financial instruments | Given the characteristics of the derivative financial instruments of the subsidiaries, the Company's assumptions basically took into account the effects of: i) the variation in the CDI, ii) the variation of the LIBOR rate, and iii) the variation in the US Dollar rate used in the transactions, achieving, respectively, the percentages and quotations indicated below: Risk variable Probable scenario Possible scenario Remote scenario (current) CDI 4.40% 5.50% 6.60% LIBOR 1.91% 2.39% 2.87% USD 4.0307 5.0384 6.0461 |
Schedule of position showing gains and losses with derivatives | The use of those assumptions in the analyses was exclusively due to the characteristics of the derivative financial instruments, which represent exposure to interest rate and exchange variations only. Position showing gains and losses with derivatives in the period 2019 Net income from USD vs. CDI transactions 5,077 |
Schedule of capital management | The Financial Leverage Index as at December 31, 2019 and December 31, 2018 can be summarized as below: 2019 2018 Balances with Adjustments Balances without IFRS 16 IFRS 16 Total borrowings and financings and derivatives (Note 19 and 36) 1,986,982 - 1,986,982 1,593,227 Lease - Liabilities (Note 15) 7,780,870 (6,196,068) 1,584,802 1,940,074 Lease - Assets (Note 15) (156,378) - (156,379) (208,049) Less: Cash and cash equivalents (Note 4) (2,284,810) - (2,284,810) (1,075,530) FIC (Note 5) (654,479) - (654,479) (784,841) Net Debt 6,672,185 (6,196,068) 476,116 1,464,881 EBITDA (1) (last 12 months) - Standardized 9,643,838 (1,315,684) 8,328,153 6,371,844 Financial Leverage Index - Unaudited 0.69 4.71 0.06 0.23 (1) Reconciliation to Net Income for the year: Adjusted Net Income 3,622,127 143,076 3,765,203 2,545,101 Depreciation and amortization 5,128,981 (940,144) 4,188,837 3,954,321 Net financial income (21,210) (592,323) (613,533) 537,333 Income tax and social contribution 913,940 73,706 987,646 (664,911) EBITDA (1) 9,643,838 (1,315,685) 8,328,153 6,371,844 (1) EBITDA: Earnings before interest, tax, depreciation and amortization (not an accounting metric) |
Schedule of changes in liabilities arising from financing activities | Changes in liabilities due to financing activities, such as borrowing and financing, financial leasing and financial instruments are presented below: Borrowing and financing Financial leasing Derivative financial instruments (assets) liabilities December 31, 2018 1,663,017 1,940,074 (69,790) Adoption of IFRS 16 - 5,256,114 - Inflows 1,000,000 1,834,914 - Financial expenses 167,998 821,463 9,068 Foreign exchange variations, net 18,222 - (14,145) Payments (820,149) (1,585,712) 32,761 Remeasurement IAS 17 (i) / IFRS16 - (485,983) - December 31, 2019 2,029,088 7,780,870 (42,106) (i) As mentioned in Note 2.f, the Company decided to adopt the pronouncement IFRS 16 – Lease, retroactively with the effect of the application as at January 1, 2019. Therefore, the lease previously classified as a financial lease, using IAS 17, the book value of the right-of-use asset and of the lease liability on the date of initial application of the standard, comprised the book value of the lease asset and of the lease liability immediately prior to the application of this new standard, in accordance with IAS 17. However, for such leases, as determined by the new standard, the Company is required to become to measure the right-of-use asset and the lease liability as from the initial application based on the new standard. Thus, the lease previously measured in accordance with IAS 17 was remeasured as at March 31, 2019, specifically with respect to the exclusion of variable lease payments that depend on an index or a rate, given that the projected inflation took into account for the period of the agreements previously measured in accordance with IAS 17. |
37. Defined benefit pension p_2
37. Defined benefit pension plans and other post-employment benefits (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of defined benefit plans [abstract] | |
Schedule of asset policy and medical plan | 2019 2018 PAMEC/ asset policy and medical plan 5,782 2,850 |
Schedule of actuarial position of liabilities and assets related to the retirement and health care plans | (a) Effects as of December 31: Plans Totals PBS PBS Assisted Management agreement PAMEC/Asset Policy AES Telecom Medical Plan 2019 2018 Reconciliation of assets and liabilities as of 12/31/19 (*) (*) (*) Present value of actuarial liabilities 40,427 10,107 151 1,080 11,099 2,585 65,449 52,206 Fair value of plan assets (43,991) (13,527) (425) - (8,982) - (66,925) (68,768) Present value of obligations in excess of fair value of assets (3,564) (3,420) (274) 1,080 2,117 2,585 (1,476) (16,562) Net actuarial liabilities / (assets) (3,564) (3,420) (274) 1,080 2,117 2,585 (1,476) (16,562) (*) No assets were recognized by the sponsors, due to the impossibility of reimbursement of this surplus, and the sponsor's contributions will not be reduced in the future. |
Schedule of ovement in net actuarial liabilities (assets) | (b) Movement in net actuarial liabilities (assets) Plans PBS PBS Assisted Management agreement PAMEC/Asset Policy AES Telecom Medical Plan Actuarial Liabilities (Assets) at 12/31/18 (14,964) (4,209) (239) 884 102 1.864 Expenditure (revenue) recognized in income (1,394) (391) (22) 81 100 283 Sponsor Contributions - - - (47) - (26) Recognized actuarial (gains) or losses 12,794 1,180 (13) 162 1,915 464 Unrecognized actuarial gains or losses - - - - - - Net actuarial liabilities (assets) as of 12/31/19 (3,564) (3,420) (274) 1,080 2,117 2,585 |
Schedule of reconciliation of the present value of the obligations | (c) Reconciliation of the present value of the obligations Plans PBS PBS Assisted Management agreement PAMEC/Asset Policy AES Telecom Medical Plan Value of liabilities at 12/31/18 32,767 8,285 156 884 8,250 1,864 Cost of current service 5 - - - 93 108 Interest on actuarial liability 2,932 738 14 81 770 175 Benefits paid in the year (2,629) (719) (9) (47) (348) (27) Contributions paid by participants - - - - 57 - (Gains)/losses on liabilities 7,352 1,803 (10) 162 2,277 465 Value of liabilities at 12/31/19 40,427 10,107 151 1,080 11,099 2,585 |
Schedule of reconciliation of fair value of assets | (d) Reconciliation of fair value of assets Plans PBS PBS Assisted Management agreement PAMEC/Asset Policy AES Telecom Medical Plan Fair value of assets at 12/31/18 47,731 12,494 395 - 8,148 - Benefits paid in the year (2,629) (719) (9) - (348) - Effective return on assets in the year 4,326 1.128 36 - 763 - Actuarial gain (loss) on plan assets (5,437) 624 3 - 361 - Contributions paid by participants - - - - 58 - Sponsor contributions poured into the plan - - - - - Fair value of assets at 12/31/19 43,991 13,527 425 - 8,982 - |
Schedule of expenditure planned for 2020 | (e) Expenditure planned for 2020 Plans PBS PBS Assisted Management agreement PAMEC/Asset Policy AES Telecom Medical Plan Current service cost (with interest) 15 - - - 125 150 Interest on actuarial liabilities 2,650 658 10 72 774 179 Expected return on assets (2,893) (888) (29) - (627) - Interest on the effect of the (asset)/ liability limit 243 230 19 - - - Total net expense (income) to be recognized 15 - - 72 272 329 |
Schedule of actuarial assumptions adopted in the calculations | The main actuarial assumptions adopted in the calculations were the following: Nominal discount rate of the actuarial liability: PBS South: 6.81% / 3.20%; PBS Northeast: 6.83% / 3.22%; MA: 6.85% / 3.24%; PBS-A: 6.75% / 3.14%; AES: 7.09% / 3.47%; PAMEC: 6.77% / 3.16%; FIBER: 6.96% / 3.34% Nominal wage growth rate: PBS e MA: Not Applicable MA and PBS-A: Not Applicable; AES: 5.57%/ 2.00%; PAMEC and FIBER: Not Applicable Biometric general mortality table: PBS, MA and PBS-A: AT-2000 segregated by sex, softened by 10%; Biometric disability entry table: PBS: Álvaro Vindas; MA, PBS-A and PAMEC: Not Applicable; AES and FIBER: Mercer Disability; Expected rate of turnover: PBS, MA, PBS-A and PAMEC: Nula AES and FIBER: 0.15/(time of service + 1), being null and void as from 50 years Probability of entry into retirement: PBS and FIBER: 100% in 1st eligibility; MA: Not Applicable; AES: 3% per year between the first age of eligibility for early retirement and eligibility for normal retirement; MA, PBS-A and PAMEC: Not Applicable Estimated long-term inflation rate PAMEC and FIBER: 7.64% / 3.25% Calculation method Projected Unit Credit Method |
38. Insurance (Tables)
38. Insurance (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Insurance [Abstract] | |
Schedule of main assets, liabilities or interests insured amounts | The table below shows the main assets, liabilities or interests insured and their respective amounts: Types Amount Insured Operating risk R$ 32,274,029 General Liability - RCG R$ 80,000 Cybernetic risks (cyber) R$ 28,520 Vehicles (executive and operational fleets) R$1,000 for civil liability optional (property damages and personal injury) and R$100 for moral damages. |
1. Operations (Details Narrativ
1. Operations (Details Narrative) - BRL (R$) R$ in Thousands | Sep. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Oct. 31, 2018 |
TIM Celular S.A. ("TIM Celular") [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Proportion of ownership interest in subsidiary | 100.00% | |||
Net book assets value on business combination | R$ 17035254 | |||
Deferred income tax assets arising from tax losses | R$ 952368 | |||
TIM Brasil Servicos e Participacoes S.A. ("TIM Brasil") [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Proportion of ownership interest in subsidiary | 66.58% | 66.58% |
2. Basis for preparation and _3
2. Basis for preparation and disclosure of the financial statements (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Current assets | ||||||
Trade accounts receivable | R$ 3184780 | R$ 2838808 | ||||
Inventories | 203,278 | 183,059 | ||||
Prepaid expenses | [1] | 175,868 | 272,060 | |||
Other assets | 80,814 | 101,197 | ||||
Total current assets | 8,454,129 | 5,998,126 | ||||
Long-term receivables | ||||||
Trade accounts receivable | 103,075 | 130,308 | ||||
Prepaid expenses | [1] | 69,656 | 74,381 | |||
Other assets | 58,514 | 30,411 | ||||
Total long-term receivables | 4,614,305 | 4,074,137 | ||||
Property, plant and equipment | 17,612,164 | 11,203,622 | [2] | R$ 10838488 | ||
Intangible assets | 9,668,326 | 10,682,004 | 11,312,527 | |||
Total non-current assets | 31,894,795 | 25,959,763 | ||||
Total assets | 40,348,924 | 31,957,889 | ||||
Current liabilities | ||||||
Financial leasing | [3] | 205,048 | ||||
Other liabilities | 9,625 | 8,233 | ||||
Total current liabilities | 8,117,479 | 7,075,379 | ||||
Non-current liabilities | ||||||
Financial leasing | [3] | 964,289 | ||||
Deferred income and social contribution taxes | 47,734 | |||||
Other liabilities | 69,005 | 59,267 | ||||
Non-current liabilities | 9,799,627 | 5,087,673 | ||||
Total liabilities | 17,917,106 | 12,163,052 | ||||
Shareholders' equity | ||||||
Capital shares | 9,866,298 | 9,866,298 | ||||
Revenue reserves | 12,159,162 | 9,524,124 | ||||
Total shareholders' equity | 22,431,818 | 19,794,837 | R$ 18151184 | R$ 17187513 | ||
Total liabilities and shareholders' equity | R$ 40348924 | 31,957,889 | ||||
Adjustment [Member] | ||||||
Current assets | ||||||
Prepaid expenses | [1] | (8,742) | ||||
Total current assets | (8,742) | |||||
Long-term receivables | ||||||
Prepaid expenses | [1] | (471) | ||||
Total long-term receivables | (471) | |||||
Property, plant and equipment | [2] | 5,265,327 | ||||
Total non-current assets | 5,264,856 | |||||
Total assets | 5,256,114 | |||||
Current liabilities | ||||||
Financial leasing | [3] | 785,065 | ||||
Total current liabilities | 785,065 | |||||
Non-current liabilities | ||||||
Financial leasing | [3] | 4,471,049 | ||||
Non-current liabilities | 4,471,049 | |||||
Total liabilities | 5,256,114 | |||||
Shareholders' equity | ||||||
Total liabilities and shareholders' equity | 5,256,114 | |||||
Balances under IFRS 16 [Member] | ||||||
Current assets | ||||||
Trade accounts receivable | 2,838,808 | |||||
Inventories | 183,059 | |||||
Prepaid expenses | [1] | 263,318 | ||||
Other assets | 2,704,199 | |||||
Total current assets | 5,989,384 | |||||
Long-term receivables | ||||||
Trade accounts receivable | 130,308 | |||||
Prepaid expenses | [1] | 73,910 | ||||
Other assets | 3,869,448 | |||||
Total long-term receivables | 4,073,666 | |||||
Property, plant and equipment | [2] | 16,468,949 | ||||
Intangible assets | 10,682,004 | |||||
Total non-current assets | 31,224,619 | |||||
Total assets | 37,214,003 | |||||
Current liabilities | ||||||
Financial leasing | [3] | 990,113 | ||||
Other liabilities | 6,870,331 | |||||
Total current liabilities | 7,860,444 | |||||
Non-current liabilities | ||||||
Financial leasing | [3] | 5,435,338 | ||||
Deferred income and social contribution taxes | ||||||
Other liabilities | 4,123,384 | |||||
Non-current liabilities | 9,558,722 | |||||
Total liabilities | 17,419,166 | |||||
Shareholders' equity | ||||||
Capital shares | 9,866,298 | |||||
Revenue reserves | 9,928,539 | |||||
Total shareholders' equity | 19,794,837 | |||||
Total liabilities and shareholders' equity | R$ 37214003 | |||||
[1] | Reclassification of the agreement for reciprocal assignment with consideration for fiber optic infrastructure previously classified as prepaid expenses (Note 11) for property, plant and equipment - right-of-use under lease; | |||||
[2] | Recognition of the asset - right-of-use under lease of the lease payments eligible for the new standard; | |||||
[3] | Increase in the Company's net debt due to the recognition of the lease liability as required by the standard; |
2. Basis for preparation and _4
2. Basis for preparation and disclosure of the financial statements (Details 1) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Disclosure of effect of overlay approach reclassification on profit or loss [line items] | ||||
Net revenue | R$ 17377194 | R$ 16981329 | R$ 16233959 | |
Cost of services provided and goods sold | (7,433,731) | (7,701,418) | (8,002,077) | |
Gross income | 9,943,463 | 9,279,911 | 8,231,882 | |
Operating revenue (expenses) | ||||
Other income (expenses), net | 1,275,541 | (283,289) | (298,710) | |
Depreciation and amortization | (3,954,321) | 3,954,321 | ||
Financial income (expenses) | 21,210 | (537,333) | (497,836) | |
Income before income and social contribution taxes | 4,536,067 | 1,880,190 | 1,435,516 | |
Income and social contribution taxes | (913,940) | 664,911 | (201,009) | |
Net income for the year | 3,622,127 | R$ 2545101 | R$ 1234507 | |
Balance without IFRS 16 [Member] | ||||
Disclosure of effect of overlay approach reclassification on profit or loss [line items] | ||||
Net revenue | 17,377,194 | |||
Cost of services provided and goods sold | [1],[2] | (4,494,914) | ||
Gross income | 12,882,280 | |||
Operating revenue (expenses) | ||||
Selling expenses | [3] | (4,800,325) | ||
General and administrative expenses | (1,029,343) | |||
Other income (expenses), net | 1,275,541 | |||
Total income expense | 8,328,153 | |||
Depreciation and amortization | [4] | (4,188,837) | ||
Financial income (expenses) | 613,533 | |||
Income before income and social contribution taxes | 4,752,849 | |||
Income and social contribution taxes | [5] | (987,646) | ||
Net income for the year | 3,765,203 | |||
Adjustment [Member] | ||||
Disclosure of effect of overlay approach reclassification on profit or loss [line items] | ||||
Cost of services provided and goods sold | [1],[2] | 1,193,407 | ||
Gross income | 1,193,407 | |||
Operating revenue (expenses) | ||||
Selling expenses | [3] | 70,935 | ||
General and administrative expenses | [6] | 51,343 | ||
Total income expense | 1,315,685 | |||
Depreciation and amortization | [4] | (940,144) | ||
Financial income (expenses) | (592,323) | |||
Income before income and social contribution taxes | (216,782) | |||
Income and social contribution taxes | [5] | 73,706 | ||
Net income for the year | (143,076) | |||
Balances under IFRS 16 [Member] | ||||
Disclosure of effect of overlay approach reclassification on profit or loss [line items] | ||||
Net revenue | 17,377,194 | |||
Cost of services provided and goods sold | [1],[2] | (3,301,507) | ||
Gross income | 14,075,687 | |||
Operating revenue (expenses) | ||||
Selling expenses | [3] | (4,729,390) | ||
General and administrative expenses | [6] | (978,000) | ||
Other income (expenses), net | 1,275,541 | |||
Total income expense | 9,643,838 | |||
Depreciation and amortization | [4] | (5,128,981) | ||
Financial income (expenses) | 21,210 | |||
Income before income and social contribution taxes | 4,536,067 | |||
Income and social contribution taxes | [5] | (913,940) | ||
Net income for the year | R$ 3622127 | |||
[1] | Leasing - infrastructure (network, land and fiber optics); | |||
[2] | Reclassification of the agreement for reciprocal assignment with consideration for fiber optic infrastructure previously classified as prepaid expenses (Note 11) for property, plant and equipment - right-of-use under lease; | |||
[3] | Leasing - stores & kiosks and vehicles; | |||
[4] | Recognition of the depreciation of the assets mentioned above; | |||
[5] | Tax impact on the adjustments from the new standard. | |||
[6] | Leasing - administrative buildings and vehicles; |
2. Basis for preparation and _5
2. Basis for preparation and disclosure of the financial statements (Details 2) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Adjustments to reconcile income with net cash from operations | |||
Income before income and social contribution taxes | R$ 4536067 | R$ 1880190 | R$ 1435516 |
Lease interest payable | 821,463 | 266,328 | 257,305 |
Depreciation and amortization | 5,128,981 | 3,954,321 | 4,013,671 |
Net cash from operations | 7,064,726 | 6,129,387 | 5,404,112 |
Net cash used in from investment activities | (3,712,642) | (3,830,420) | (4,400,575) |
Net cash used in financing activities | (2,142,804) | (4,184,155) | (3,171,005) |
Increase (decrease) in cash and cash equivalents | 1,209,280 | (1,885,188) | (2,167,468) |
Cash and cash equivalents at the beginning of the year | 1,075,530 | 2,960,718 | 5,128,186 |
Cash and cash equivalents at the end of the year | 2,284,810 | 1,075,530 | R$ 2960718 |
Balance without IFRS 16 [Member] | |||
Adjustments to reconcile income with net cash from operations | |||
Income before income and social contribution taxes | 4,752,850 | ||
Lease interest payable | 229,139 | ||
Depreciation and amortization | 4,188,837 | ||
Net cash from operations | 5,749,042 | ||
Net cash used in from investment activities | (3,721,742) | ||
Net cash used in financing activities | (827,120) | ||
Increase (decrease) in cash and cash equivalents | 1,209,280 | ||
Cash and cash equivalents at the beginning of the year | 1,075,530 | ||
Cash and cash equivalents at the end of the year | 2,284,810 | 1,075,530 | |
Adjustment [Member] | |||
Adjustments to reconcile income with net cash from operations | |||
Income before income and social contribution taxes | (216,783) | ||
Lease interest payable | 592,324 | ||
Depreciation and amortization | 940,144 | ||
Net cash from operations | 1,315,684 | ||
Net cash used in from investment activities | |||
Net cash used in financing activities | (1,315,684) | ||
Increase (decrease) in cash and cash equivalents | |||
Cash and cash equivalents at the beginning of the year | |||
Cash and cash equivalents at the end of the year | |||
Balances under IFRS 16 [Member] | |||
Adjustments to reconcile income with net cash from operations | |||
Income before income and social contribution taxes | 4,536,067 | ||
Lease interest payable | 821,463 | ||
Depreciation and amortization | 5,128,981 | ||
Net cash from operations | 7,064,726 | ||
Net cash used in from investment activities | (3,721,742) | ||
Net cash used in financing activities | (2,142,804) | ||
Increase (decrease) in cash and cash equivalents | R$ 1209280 |
3. Estimates and areas where _3
3. Estimates and areas where judgment is significant in the application of the Company's accounting policies (Details ) | 12 Months Ended |
Dec. 31, 2019 | |
Estimates And Areas Where Judgment Is Significant In The Application Of The Company'S Accounting Policies [Abstract] | |
Percentage of average incremental rate | 10.55% |
4. Cash and cash equivalents (D
4. Cash and cash equivalents (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Cash and cash equivalents [abstract] | ||||
Cash and banks | R$ 101928 | R$ 93960 | ||
Unrestrictedly available financial investments: | ||||
CDBs/Repurchases | 2,182,882 | 981,570 | ||
Total cash and cash equivalents | R$ 2284810 | R$ 1075530 | R$ 2960718 | R$ 5128186 |
4. Cash and cash equivalents _2
4. Cash and cash equivalents (Details Narrative) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash and cash equivalents [abstract] | ||
Return rate on cash and cash equivalent | 99.95% | 100.27% |
5. Marketable securities (Detai
5. Marketable securities (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of financial assets [line items] | |||
Marketable securities | R$ 658328 | R$ 790070 | |
Current portion | (654,479) | (784,841) | |
Non-current portion | 3,849 | 5,229 | |
FUNCINE [Member] | |||
Disclosure of financial assets [line items] | |||
Marketable securities | [1] | 3,849 | 5,229 |
Fundo Soberano [Member] | |||
Disclosure of financial assets [line items] | |||
Marketable securities | [2] | 7,329 | 14,472 |
FIC - Government Securities [Member] | |||
Disclosure of financial assets [line items] | |||
Marketable securities | [3] | 179,390 | 292,708 |
FIC - Repo Transactions [Member] | |||
Disclosure of financial assets [line items] | |||
Marketable securities | [3],[4] | 216,196 | 289,352 |
Financial Bills [Member] | |||
Disclosure of financial assets [line items] | |||
Marketable securities | [3] | 105,857 | 96,868 |
Other [Member] | |||
Disclosure of financial assets [line items] | |||
Marketable securities | [3],[5] | R$ 145707 | R$ 91441 |
[1] | In December 2017, in order to use the tax benefit of deductibility for income and social contribution tax purposes the Company invested the amount of R$3 million in the National Film Industry Financing Fund ("FUNCINE"). In 2018, the Company opted to make new investments in FUNCINE in the months of October and December in the total amount of R$2.4 million. In June 2019, the Company made new investments in the amount of R$2.2 million. The average remuneration in 2019 of FUNCINE was 9.18%. | ||
[2] | "Fundo Soberano" includes federal securities only. The average remuneration in 2019 was 97.62% of the variation of the CDI rate. | ||
[3] | In August 2017, the Company invested in open-ended Investment Funds in Units ("FICs"). The Funds are mostly made up of government securities and instruments of first-tier financial institutions. In 2018, the average yield of FICs was 100.81% of the variation of the CDI rate. | ||
[4] | "Repo Transactions" are securities issued by banks with a commitment to repurchase within one day at pre-established rates. These repo transactions are backed by federal government bonds and are used by the fund with the purpose of remunerating the capital available in cash. | ||
[5] | Represented by: Debentures, FIDC, Trade Bills, Promissory Notes, Bank Credit Notes. |
5. Marketable securities (Det_2
5. Marketable securities (Details Narrative) - BRL (R$) R$ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2019 | Oct. 31, 2018 | Dec. 31, 2017 | |
FICs [Member] | |||||
Disclosure of financial assets [line items] | |||||
Average yield rate | 99.67% | 100.81% | |||
FUNCINE [Member] | |||||
Disclosure of financial assets [line items] | |||||
Average yield rate | 9.18% | ||||
Investment | R$ 2400 | R$ 2200 | R$ 2400 | R$ 3000 | |
Fundo Soberano [Member] | |||||
Disclosure of financial assets [line items] | |||||
Average yield rate | 97.62% |
6. Trade accounts receivable (D
6. Trade accounts receivable (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
TradeAccountsReceivableLineItemLineItems [Line Items] | |||
Gross accounts receivable | R$ 4061932 | R$ 3656044 | |
Provision for expected credit losses | (774,077) | (686,928) | R$ 464745 |
Current portion | (3,184,780) | (2,838,808) | |
Non-current portion | 103,075 | 130,308 | |
Trade accounts receivable | 3,287,855 | 2,969,116 | |
Billed Services [Member] | |||
TradeAccountsReceivableLineItemLineItems [Line Items] | |||
Gross accounts receivable | 2,076,569 | 1,733,229 | |
Unbilled Services [Member] | |||
TradeAccountsReceivableLineItemLineItems [Line Items] | |||
Gross accounts receivable | 858,418 | 774,484 | |
Network Use (Interconnection) [Member] | |||
TradeAccountsReceivableLineItemLineItems [Line Items] | |||
Gross accounts receivable | 438,168 | 455,228 | |
Sale Of Goods [Member] | |||
TradeAccountsReceivableLineItemLineItems [Line Items] | |||
Gross accounts receivable | 670,573 | 691,312 | |
Contractual Asset [Member] | |||
TradeAccountsReceivableLineItemLineItems [Line Items] | |||
Gross accounts receivable | 15,142 | 130 | |
Other Accounts Receivable [Member] | |||
TradeAccountsReceivableLineItemLineItems [Line Items] | |||
Gross accounts receivable | R$ 3062 | R$ 1661 |
6. Trade accounts receivable _2
6. Trade accounts receivable (Details 1) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Trade Accounts Receivable [Abstract] | ||
Opening balance | R$ 686928 | R$ 464745 |
Set-up of provision | 748,291 | 544,881 |
Impact of adopting IFRS 9 | 130,137 | |
Write-off of provision | (661,142) | (452,835) |
Closing balance | R$ 774077 | R$ 686928 |
6. Trade accounts receivable _3
6. Trade accounts receivable (Details 2) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
TradeAccountsReceivableLineItemLineItems [Line Items] | ||
Trade account receivables gross | R$ 4061932 | R$ 3656044 |
Falling Due [Member] | ||
TradeAccountsReceivableLineItemLineItems [Line Items] | ||
Trade account receivables gross | 2,576,307 | 2,459,315 |
Overdue Up To 30 days [Member] | ||
TradeAccountsReceivableLineItemLineItems [Line Items] | ||
Trade account receivables gross | 328,457 | 308,744 |
Overdue Up To 60 days [Member] | ||
TradeAccountsReceivableLineItemLineItems [Line Items] | ||
Trade account receivables gross | 146,200 | 144,309 |
Overdue Up To 90 days [Member] | ||
TradeAccountsReceivableLineItemLineItems [Line Items] | ||
Trade account receivables gross | 149,852 | 117,759 |
Invoices Overdue More Than 90 days [Member] | ||
TradeAccountsReceivableLineItemLineItems [Line Items] | ||
Trade account receivables gross | R$ 861116 | R$ 625917 |
6. Trade accounts receivable _4
6. Trade accounts receivable (Details Narrative) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
TradeAccountsReceivableLineItemLineItems [Line Items] | ||
Non-current portion | R$ 103075 | R$ 130308 |
Other Telephone Carriers [Member] | ||
TradeAccountsReceivableLineItemLineItems [Line Items] | ||
Non-current portion | R$ 68639 | R$ 102960 |
7. Inventory (Details)
7. Inventory (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure of fair value measurement of assets [line items] | ||
Inventories gross | R$ 214889 | R$ 189826 |
Losses on adjustment to realizable amount | (11,611) | (6,767) |
Total inventories | 203,278 | 183,059 |
Mobile Handsets and Tablets [Member] | ||
Disclosure of fair value measurement of assets [line items] | ||
Inventories gross | 146,295 | 145,819 |
Accessories and Prepaid Cards [Member] | ||
Disclosure of fair value measurement of assets [line items] | ||
Inventories gross | 61,436 | 33,621 |
TIM Chips [Member] | ||
Disclosure of fair value measurement of assets [line items] | ||
Inventories gross | R$ 7158 | R$ 10386 |
8. Indirect taxes, charges an_3
8. Indirect taxes, charges and contributions recoverable (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
IndirectTaxesChargesAndContributionsRecoverableLineItems [Line Items] | ||
Indirect taxes, charges and contributions recoverable | R$ 1243633 | R$ 1192765 |
Current portion | (420,284) | (280,254) |
Non-current portion | 823,349 | 912,511 |
Imposto sobre Circulacao de Mercadorias Servicos [Member] | Indirect [Member] | ||
IndirectTaxesChargesAndContributionsRecoverableLineItems [Line Items] | ||
Indirect taxes, charges and contributions recoverable | 1,201,502 | 1,152,741 |
Other [Member] | Indirect [Member] | ||
IndirectTaxesChargesAndContributionsRecoverableLineItems [Line Items] | ||
Indirect taxes, charges and contributions recoverable | R$ 42131 | R$ 40024 |
9. Direct taxes, charges and _3
9. Direct taxes, charges and contributions recoverable (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of fair value measurement of assets [line items] | |||
Direct taxes and contributions recoverable | R$ 3762800 | R$ 905521 | |
Current portion | (1,395,193) | (347,505) | |
Non-current portion | 2,367,607 | 558,016 | |
Income Tax (IR) And Social Contribution (CS) [Member] | Direct [Member] | |||
Disclosure of fair value measurement of assets [line items] | |||
Direct taxes and contributions recoverable | [1] | 428,443 | 414,408 |
PIS/COFINS [Member] | Direct [Member] | |||
Disclosure of fair value measurement of assets [line items] | |||
Direct taxes and contributions recoverable | [2] | 3,244,549 | 384,093 |
Others [Member] | Direct [Member] | |||
Disclosure of fair value measurement of assets [line items] | |||
Direct taxes and contributions recoverable | R$ 89808 | R$ 107020 | |
[1] | The amounts corresponding to income and social contribution taxes are substantially related to: (a) advances made over the period during which the use will take place at the closing of the current year and any balances in the next year; and (b) other income and social contribution tax credits from previous years whose current estimated period of use will be more than 12 months later. | ||
[2] | The PIS/COFINS amounts recoverable mainly refer to credits from a legal proceedings filed by TIM Celular S.A. (ultimately merged into TIM S.A., as well as TIM S.A. itself, with a favorable final decision in Higher Courts which discussed the exclusion of the ICMS from the PIS and COFINS tax bases. According to the Company's internal evaluation, we expect to use such credits within the statute of limitations of up to 5 years. |
9. Direct taxes, charges and _4
9. Direct taxes, charges and contributions recoverable (Details Narrative) - BRL (R$) R$ in Thousands | 1 Months Ended | |
Sep. 30, 2019 | Jun. 30, 2019 | |
Direct Taxes, Charges And Contributions Recoverable [Abstract] | ||
Total amount recorded | R$ 148000 | R$ 2875000 |
Principal amount | 75,000 | 1,720,000 |
Monetary adjustments | R$ 73000 | R$ 1155000 |
10. Deferred income tax and s_3
10. Deferred income tax and social contribution (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred taxes - Assets | ||
Losses carried forward - income tax and social contribution | R$ 800711 | R$ 896100 |
Temporary differences: | ||
Provision for legal and administrative proceedings | 295,853 | 293,349 |
Losses from doubtful accounts | 271,611 | 244,428 |
Adjustments to present value - 3G license | 7,182 | 9,124 |
Deferred tax on IFRS adjustments: | ||
Deferred income tax on accounting adjustments | 56,208 | 58,268 |
Lease of LT Amazonas infrastructure | 27,434 | 24,978 |
Profit sharing | 23,704 | 22,181 |
Taxes with suspended enforceability | 12,872 | 12,872 |
Amortized goodwill - TIM Fiber | (370,494) | (370,494) |
Derivative financial instruments | (13,139) | (22,551) |
Capitalized interest on 4G authorization | (291,783) | (301,525) |
Deemed costs - TIM S.A. | (67,748) | (82,042) |
Exclusion of ICMS from PIS and COFINS calculation bases | (1,023,928) | |
IFRS16 Lease | 209,234 | |
Other | 87,214 | 74,821 |
Total deferred taxes - Assets | 24,931 | 859,509 |
Unrecognized deferred income tax and social contribution Taxes with suspended enforceability | (72,665) | (57,538) |
Subtotal | (47,734) | 801,971 |
Deferred tax assets portion | 801,971 | |
Deferred tax liabilities portion | R$ 47734 |
10. Deferred income tax and s_4
10. Deferred income tax and social contribution (Details 1) - TIM Celular S.A. ("TIM Celular") [Member] R$ in Thousands | Dec. 31, 2019BRL (R$) |
DeferredTaxesLineLineItems [Line Items] | |
2020 | R$ 229151 |
2021 | 275,425 |
2022 | 296,135 |
2023 | |
Tax losses and negative base | 800,711 |
Temporary differences | (848,445) |
Total | R$ 47734 |
10. Deferred income tax and s_5
10. Deferred income tax and social contribution (Details Narrative) - BRL (R$) R$ in Thousands | 1 Months Ended | 12 Months Ended | |||
Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2019 | Sep. 30, 2018 | |
DeferredIncomeTaxAndSocialContributionAbstractLineItems [Line Items] | |||||
Applicable tax rate for income tax | 25.00% | 25.00% | |||
Applicable tax rate for social contribution | 9.00% | 9.00% | |||
Deferred tax assets | R$ 801971 | ||||
Deferred tax liabilities | 47,734 | ||||
TIM Celular S.A. ("TIM Celular") [Member] | |||||
DeferredIncomeTaxAndSocialContributionAbstractLineItems [Line Items] | |||||
Deferred tax assets | R$ 952368 | ||||
Tax losses | 702,619 | ||||
Social contribution on income | R$ 249749 | ||||
Tax credit amount | 2,862,700 | R$ 2875500 | |||
Final unappealable decision amount | R$ 148000 | 149,000 | |||
Deferred tax liabilities | 1,039,700 | ||||
Credits related to tax carry forward losses | R$ 91731 | R$ 85812 |
11. Prepaid expenses (Details)
11. Prepaid expenses (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Prepaid Expenses [Abstract] | |||
Prepaid expenses | R$ 245524 | R$ 346441 | |
Advertising not released | [1] | 854 | 76,651 |
Rentals and insurance | 75,809 | 78,005 | |
Network swap | [2] | 11,449 | |
Incremental costs for obtaining customer contracts | [3] | 158,093 | 173,056 |
Other | 10,768 | 7,280 | |
Current portion | [4] | (175,868) | (272,060) |
Non-current portion | [4] | R$ 69656 | R$ 74381 |
[1] | Represents the early payment of expenses from the advertising of TIM brand's products and services, which were recognized in income for the period during which the advertising was broadcast. | ||
[2] | On April 1, 2010, the subsidiary TIM S.A. and GVT entered into an onerous contract and a reciprocal agreement for the assignment of fiber optic infrastructure (network swap), in order to expand their respective areas of operation. Given the economic nature of the transaction, the amount was recognized in the (current and non-current) prepaid expenses and deferred revenue (current and non-current) and is amortized to income according to the contract's term. This contract is within the scope of IFRS 16. Therefore, it was reclassified to right-of-use in leases under property, plant and equipment, as shown in Note 2.f. | ||
[3] | This is mainly represented by incremental costs related to sales commissions paid to sales agents in order to obtain customer contracts arising from the adoption of IFRS 15, which are deferred to income according to the term and/or economic benefit of the contract, which is usually two years. | ||
[4] | Reclassification of the agreement for reciprocal assignment with consideration for fiber optic infrastructure previously classified as prepaid expenses (Note 11) for property, plant and equipment - right-of-use under lease; |
11. Prepaid expenses (Details N
11. Prepaid expenses (Details Narrative) | 12 Months Ended |
Dec. 31, 2019 | |
Adoption Of IFRS 15 [Member] | |
PrepaidExpensesLineItems [Line Items] | |
Period of intangible assets | 2 years |
12. Judicial deposits (Details)
12. Judicial deposits (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Judicial deposits [line items] | |||
Non-current portion | R$ 1006899 | R$ 1345113 | |
Civil [Member] | |||
Judicial deposits [line items] | |||
Non-current portion | 355,093 | 334,028 | |
Labor [Member] | |||
Judicial deposits [line items] | |||
Non-current portion | 245,928 | 492,000 | |
Tributary [Member] | |||
Judicial deposits [line items] | |||
Non-current portion | 203,110 | 299,310 | |
Regulatory [Member] | |||
Judicial deposits [line items] | |||
Non-current portion | 111 | 111 | |
Online Attachment [Member] | |||
Judicial deposits [line items] | |||
Non-current portion | [1] | R$ 202657 | R$ 219664 |
[1] | Refers to blocked judicial deposits directly on the Company's bank accounts and financial investments related to certain judicial proceedings. This amount is analyzed periodically and, when identified, is reclassified to one of the other specific accounts of judicial deposits. |
12. Judicial deposits (Details
12. Judicial deposits (Details Narrative) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Civil [Member] | ||
Judicial deposits [line items] | ||
Court deposit | R$ 69326 | R$ 66700 |
Tax [Member] | Tax Court Proceedings Related to Production [Member] | ||
Judicial deposits [line items] | ||
Court deposit | 73,326 | 74,358 |
Tax [Member] | Tax Court Proceedings Related to CPMF [Member] | ||
Judicial deposits [line items] | ||
Court deposit | 10,342 | 10,026 |
Tax [Member] | Tax Court Proceedings Related to TFF [Member] | ||
Judicial deposits [line items] | ||
Court deposit | 18,401 | 16,719 |
Tax [Member] | Tax Court Proceedings Related to IRRF [Member] | ||
Judicial deposits [line items] | ||
Court deposit | 11,173 | 10,868 |
Tax [Member] | Tax Court Proceedings Related to ISS [Member] | ||
Judicial deposits [line items] | ||
Court deposit | 7,878 | 7,519 |
Tax [Member] | Tax Court Proceedings Related to Ancillary Services [Member] | ||
Judicial deposits [line items] | ||
Court deposit | 3,457 | 4,793 |
Tax [Member] | Tax Court Proceedings Related to ANATEL [Member] | ||
Judicial deposits [line items] | ||
Court deposit | 3,471 | 3,380 |
Tax [Member] | Tax Court Proceedings Related To Telecommunications Services Universalization Fund (''FUST") [Member] | ||
Judicial deposits [line items] | ||
Court deposit | R$ 57943 | R$ 56088 |
13. Property, plant and equip_3
13. Property, plant and equipment (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | |||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | R$ 11203622 | [1] | R$ 10838488 | |
Adoption of IFRS 16 | 5,256,114 | |||
Additions/(Depreciation) | 1,592,958 | 374,677 | ||
Disposals | (32,412) | (9,543) | ||
Transfers | ||||
Other changes | (408,118) | |||
Balance end | 17,612,164 | 11,203,622 | [1] | |
Commutation and Transmission Equipment [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 5,870,180 | 5,393,837 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (1,559,828) | (1,601,352) | ||
Disposals | (3,791) | (943) | ||
Transfers | 2,121,907 | 2,078,638 | ||
Other changes | ||||
Balance end | 6,428,468 | 5,870,180 | ||
Fiber Optic Cables [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 416,643 | 393,272 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (65,035) | (54,813) | ||
Disposals | ||||
Transfers | 51,414 | 78,184 | ||
Other changes | ||||
Balance end | 403,022 | 416,643 | ||
Leased Handsets [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 181,718 | 165,612 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (130,822) | (124,709) | ||
Disposals | (13,489) | (7,175) | ||
Transfers | 195,725 | 14,799 | ||
Other changes | ||||
Balance end | 233,132 | 181,718 | ||
Infrastructure [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 297,592 | 2,954,962 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (440,224) | (463,178) | ||
Disposals | (14,403) | (718) | ||
Transfers | 294,851 | 484,854 | ||
Other changes | (94,988) | |||
Balance end | 2,503,014 | 297,592 | ||
Informatics Assets [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 167,214 | 166,631 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (62,561) | (72,876) | ||
Disposals | (46) | |||
Transfers | 51,289 | 73,505 | ||
Other changes | ||||
Balance end | 155,942 | 167,214 | ||
General Use Assets [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 25,149 | 237,314 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (45,931) | (44,467) | ||
Disposals | (1) | (489) | ||
Transfers | 63,289 | 59,132 | ||
Other changes | ||||
Balance end | 268,847 | 25,149 | ||
Land [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 40,794 | 40,794 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | ||||
Disposals | ||||
Transfers | ||||
Other changes | ||||
Balance end | 40,794 | 40,794 | ||
Construction In Progress [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 1,299,663 | 1,486,066 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | 3,065,213 | 2,736,072 | ||
Disposals | (728) | (172) | ||
Transfers | (2,778,475) | (2,922,303) | ||
Other changes | ||||
Balance end | 1,585,673 | 1,299,663 | ||
Right-of-Use In Leases [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | ||||
Adoption of IFRS 16 | 5,256,114 | |||
Additions/(Depreciation) | 832,146 | |||
Disposals | ||||
Transfers | ||||
Other changes | (94,988) | |||
Balance end | 5,993,272 | |||
Gross Carrying Amount [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 33,832,803 | 31,166,905 | ||
Adoption of IFRS 16 | 5,256,114 | |||
Additions/(Depreciation) | 4,855,684 | 2,746,039 | ||
Disposals | (183,384) | (80,141) | ||
Transfers | ||||
Other changes | (408,118) | |||
Balance end | 43,353,099 | 33,832,803 | ||
Gross Carrying Amount [Member] | Commutation and Transmission Equipment [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 5,870,180 | 18,766,840 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | 17,662 | 8,974 | ||
Disposals | (133,789) | (48,203) | ||
Transfers | 2,121,907 | 2,078,638 | ||
Other changes | ||||
Balance end | 22,812,029 | 5,870,180 | ||
Gross Carrying Amount [Member] | Fiber Optic Cables [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 762,175 | 683,971 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | 20 | |||
Disposals | ||||
Transfers | 51,414 | 78,184 | ||
Other changes | ||||
Balance end | 813,589 | 762,175 | ||
Gross Carrying Amount [Member] | Leased Handsets [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 2,313,945 | 2,181,630 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | 519 | |||
Disposals | (20,194) | (15,675) | ||
Transfers | 195,725 | 147,990 | ||
Other changes | ||||
Balance end | 2,489,995 | 2,313,945 | ||
Gross Carrying Amount [Member] | Infrastructure [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 6,133,810 | 5,652,840 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | 678 | |||
Disposals | (18,684) | (4,562) | ||
Transfers | 294,851 | 484,854 | ||
Other changes | (31,313) | |||
Balance end | 6,096,847 | 6,133,810 | ||
Gross Carrying Amount [Member] | Informatics Assets [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 1,679,328 | 1,615,325 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | 9 | |||
Disposals | (9,366) | (9,511) | ||
Transfers | 51,289 | 73,505 | ||
Other changes | ||||
Balance end | 1,721,251 | 1,679,328 | ||
Gross Carrying Amount [Member] | General Use Assets [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 251,490 | 739,439 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | 286 | |||
Disposals | (623) | (2,018) | ||
Transfers | 63,289 | 59,132 | ||
Other changes | ||||
Balance end | 859,505 | 251,490 | ||
Gross Carrying Amount [Member] | Land [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 40,794 | 40,794 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | ||||
Disposals | ||||
Transfers | ||||
Other changes | ||||
Balance end | 40,794 | 40,794 | ||
Gross Carrying Amount [Member] | Construction In Progress [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | 1,299,663 | 1,486,066 | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | 3,065,213 | 2,736,072 | ||
Disposals | (728) | (172) | ||
Transfers | (2,778,475) | (2,922,303) | ||
Other changes | ||||
Balance end | 1,585,673 | 1,299,663 | ||
Gross Carrying Amount [Member] | Right-of-Use Assets [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | ||||
Adoption of IFRS 16 | 5,256,114 | |||
Additions/(Depreciation) | 177,229 | |||
Disposals | ||||
Transfers | ||||
Other changes | (94,988) | |||
Balance end | 6,933,416 | |||
Accumulated Amortization [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | (22,629,181) | (20,328,417) | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (3,262,726) | (2,371,362) | ||
Disposals | 150,972 | 70,598 | ||
Transfers | ||||
Other changes | ||||
Balance end | (25,740,935) | (22,629,181) | ||
Accumulated Amortization [Member] | Commutation and Transmission Equipment [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | (14,936,069) | (13,373,003) | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (1,577,490) | (1,610,326) | ||
Disposals | 129,998 | 4,726 | ||
Transfers | ||||
Other changes | ||||
Balance end | (16,383,561) | (14,936,069) | ||
Accumulated Amortization [Member] | Fiber Optic Cables [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | (345,532) | (290,699) | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (65,035) | (54,833) | ||
Disposals | ||||
Transfers | ||||
Other changes | ||||
Balance end | (410,567) | (345,532) | ||
Accumulated Amortization [Member] | Leased Handsets [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | (2,132,227) | (2,016,018) | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (131,341) | (124,709) | ||
Disposals | 6,705 | 85 | ||
Transfers | ||||
Other changes | ||||
Balance end | (2,256,863) | (2,132,227) | ||
Accumulated Amortization [Member] | Infrastructure [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | (3,157,890) | (2,697,878) | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (440,224) | (463,856) | ||
Disposals | 4,281 | 3,844 | ||
Transfers | ||||
Other changes | ||||
Balance end | (3,593,833) | (3,157,890) | ||
Accumulated Amortization [Member] | Informatics Assets [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | (1,512,114) | (1,448,694) | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (62,561) | (72,885) | ||
Disposals | 9,366 | 9,465 | ||
Transfers | ||||
Other changes | ||||
Balance end | (1,565,309) | (1,512,114) | ||
Accumulated Amortization [Member] | General Use Assets [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | (545,349) | (502,125) | ||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (45,931) | (44,753) | ||
Disposals | 622 | 1,529 | ||
Transfers | ||||
Other changes | ||||
Balance end | (590,658) | (545,349) | ||
Accumulated Amortization [Member] | Right-of-Use In Leases [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Balance beginning | ||||
Adoption of IFRS 16 | ||||
Additions/(Depreciation) | (940,144) | |||
Disposals | ||||
Transfers | ||||
Other changes | ||||
Balance end | R$ 940144 | |||
[1] | Recognition of the asset - right-of-use under lease of the lease payments eligible for the new standard; |
13. Property, plant and equip_4
13. Property, plant and equipment (Details 1) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019BRL (R$) | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Balance beginning | R$ 11203622 | [1] |
Additions in the period, net of cancellation | 1,772,290 | |
Remensuration | (94,988) | |
Depreciation | (940,144) | |
Balance end | 17,612,164 | |
Lease Operation - Network [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Balance beginning | 2,625,145 | |
Additions in the period, net of cancellation | 928,682 | |
Remensuration | 5,841 | |
Depreciation | (387,526) | |
Balance end | R$ 3172142 | |
Useful Life | 10.98% | |
Lease Operation - Vehicles [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Balance beginning | R$ 6792 | |
Additions in the period, net of cancellation | 5,045 | |
Remensuration | (500) | |
Depreciation | (4,349) | |
Balance end | R$ 6988 | |
Useful Life | 44.81% | |
Lease Operation - Stores & Kiosks [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Balance beginning | R$ 375286 | |
Additions in the period, net of cancellation | 191,597 | |
Remensuration | 5,895 | |
Depreciation | (93,306) | |
Balance end | R$ 479472 | |
Useful Life | 21.04% | |
Lease Operation - Property [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Balance beginning | R$ 1540685 | |
Additions in the period, net of cancellation | 322,067 | |
Remensuration | (138,967) | |
Depreciation | (183,872) | |
Balance end | R$ 1539913 | |
Useful Life | 11.97% | |
Lease Operation - Land (Network) [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Balance beginning | R$ 708206 | |
Additions in the period, net of cancellation | 324,899 | |
Remensuration | 32,743 | |
Depreciation | (271,091) | |
Balance end | R$ 794757 | |
Useful Life | 31.25% | |
[1] | Recognition of the asset - right-of-use under lease of the lease payments eligible for the new standard; |
13. Property, plant and equip_5
13. Property, plant and equipment (Details 2) | 12 Months Ended |
Dec. 31, 2019 | |
Commutation and Transmission Equipment [Member] | Bottom Of Range [member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 8.00% |
Commutation and Transmission Equipment [Member] | Top Of Range [Member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 14.29% |
Fiber Optic Cables [Member] | Bottom Of Range [member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 4.00% |
Fiber Optic Cables [Member] | Top Of Range [Member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 10.00% |
Leased Handsets [Member] | Bottom Of Range [member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 14.28% |
Leased Handsets [Member] | Top Of Range [Member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 50.00% |
Infrastructure [Member] | Bottom Of Range [member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 4.00% |
Infrastructure [Member] | Top Of Range [Member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 20.00% |
Informatics Assets [Member] | Bottom Of Range [member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 10.00% |
Informatics Assets [Member] | Top Of Range [Member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 20.00% |
General Use Assets [Member] | Bottom Of Range [member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 10.00% |
General Use Assets [Member] | Top Of Range [Member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Depreciation rates | 20.00% |
13. Property, plant and equip_6
13. Property, plant and equipment (Details Narrative) R$ in Thousands | 12 Months Ended |
Dec. 31, 2019BRL (R$) | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Other changes | R$ 408118 |
Sale of Towers (Leaseback) [Member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Other changes | 313,130 |
Infrastructure [Member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Other changes | R$ 94988 |
14. Intangible assets (Details)
14. Intangible assets (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | R$ 10682004 | R$ 11312527 |
Additions/(Amortization) | (915,045) | (659,921) |
Transfers | (128,917) | |
Other Changes | (98,633) | |
Disposals | ||
Capitalized Interests | 158,315 | |
Intangible assets, ending balance | 9,668,326 | 10,682,004 |
Accumulated Amortization [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | (18,684,775) | (17,237,025) |
Additions/(Amortization) | (1,876,258) | (1,799,914) |
Transfers | 350,894 | |
Disposals | 1,270 | |
Intangible assets, ending balance | (20,561,033) | (18,684,775) |
Gross Carrying Amount [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 29,366,779 | 28,549,552 |
Additions/(Amortization) | 961,213 | 1,139,993 |
Transfers | (479,811) | |
Other Changes | (98,633) | |
Disposals | (1,270) | |
Capitalized Interests | 158,315 | |
Intangible assets, ending balance | 30,229,359 | 29,366,779 |
List of Clients [Member] | Accumulated Amortization [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | (95,200) | |
Transfers | (95,200) | |
Disposals | ||
List of Clients [Member] | Gross Carrying Amount [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 952 | |
Transfers | (952) | |
Disposals | ||
Intangible Assets Under Development [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 2,552,093 | 3,724,587 |
Additions/(Amortization) | 934,245 | 1,045,845 |
Transfers | (3,317,074) | (2,376,654) |
Other Changes | 40,011 | |
Disposals | ||
Capitalized Interests | 158,315 | |
Intangible assets, ending balance | 209,275 | 2,552,093 |
Intangible Assets Under Development [Member] | Gross Carrying Amount [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 2,552,093 | 3,724,587 |
Additions/(Amortization) | 934,245 | 1,045,845 |
Transfers | (3,317,074) | (2,376,654) |
Other Changes | 40,011 | |
Disposals | ||
Capitalized Interests | 158,315 | |
Intangible assets, ending balance | 209,275 | 2,552,093 |
Other Assets [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 202,048 | 190,236 |
Additions/(Amortization) | (23,644) | (25,155) |
Transfers | 19,708 | 36,967 |
Disposals | ||
Intangible assets, ending balance | 198,112 | 202,048 |
Other Assets [Member] | Accumulated Amortization [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | (105,606) | (80,451) |
Additions/(Amortization) | (23,644) | (25,155) |
Disposals | ||
Intangible assets, ending balance | (129,250) | (105,606) |
Other Assets [Member] | Gross Carrying Amount [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 307,654 | 270,687 |
Transfers | 19,708 | 36,967 |
Disposals | ||
Intangible assets, ending balance | 327,362 | 307,654 |
Right To Use Infrastructure Of LT Amazonas [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 145,761 | 155,671 |
Additions/(Amortization) | (7,763) | (9,910) |
Other Changes | (28,874) | |
Disposals | ||
Intangible assets, ending balance | 109,124 | 145,761 |
Right To Use Infrastructure Of LT Amazonas [Member] | Accumulated Amortization [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | (52,441) | (42,531) |
Additions/(Amortization) | (7,763) | (9,910) |
Disposals | ||
Intangible assets, ending balance | (60,204) | (52,441) |
Right To Use Infrastructure Of LT Amazonas [Member] | Gross Carrying Amount [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 198,202 | 198,202 |
Other Changes | (28,874) | |
Disposals | ||
Intangible assets, ending balance | 169,328 | 198,202 |
Costs With Commissions To Deferred Sales Representatives [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 128,761 | |
Transfers | (128,761) | |
Disposals | ||
Costs With Commissions To Deferred Sales Representatives [Member] | Accumulated Amortization [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | (255,694) | |
Transfers | 255,694 | |
Disposals | ||
Costs With Commissions To Deferred Sales Representatives [Member] | Gross Carrying Amount [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 384,455 | |
Transfers | (384,455) | |
Disposals | ||
Goodwill [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 1,527,219 | 1,527,219 |
Disposals | ||
Intangible assets, ending balance | 1,527,219 | 1,527,219 |
Goodwill [Member] | Gross Carrying Amount [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 1,527,219 | 1,527,219 |
Disposals | ||
Intangible assets, ending balance | 1,527,219 | 1,527,219 |
Authorizations [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 2,793,328 | 1,893,636 |
Additions/(Amortization) | (405,803) | (253,736) |
Transfers | 2,255,625 | 1,153,428 |
Other Changes | (109,770) | |
Disposals | ||
Intangible assets, ending balance | 4,533,380 | 2,793,328 |
Authorizations [Member] | Accumulated Amortization [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | (4,845,642) | (4,497,758) |
Additions/(Amortization) | (432,771) | (347,884) |
Disposals | ||
Intangible assets, ending balance | (5,278,413) | (4,845,642) |
Authorizations [Member] | Gross Carrying Amount [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 7,638,970 | 6,391,394 |
Additions/(Amortization) | 26,968 | 94,148 |
Transfers | 2,255,625 | 1,153,428 |
Other Changes | (109,770) | |
Disposals | ||
Intangible assets, ending balance | 9,811,793 | 7,638,970 |
Right To Use Software [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 3,461,555 | 3,692,417 |
Additions/(Amortization) | (1,412,080) | (1,416,965) |
Transfers | 1,041,741 | 1,186,103 |
Disposals | ||
Intangible assets, ending balance | 3,091,216 | 3,461,555 |
Right To Use Software [Member] | Accumulated Amortization [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | (13,681,086) | (12,265,391) |
Additions/(Amortization) | (141,208) | (1,416,965) |
Disposals | (1,270) | |
Intangible assets, ending balance | (15,093,166) | (13,681,086) |
Right To Use Software [Member] | Gross Carrying Amount [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets, beginning balance | 17,142,641 | 15,957,808 |
Transfers | 1,041,741 | 1,186,103 |
Disposals | (1,270) | |
Intangible assets, ending balance | R$ 18184382 | R$ 17142641 |
14. Intangible assets (Details
14. Intangible assets (Details 1) | 12 Months Ended |
Dec. 31, 2019 | |
Authorizations [Member] | Bottom Of Range [member] | |
Disclosure of detailed information about intangible assets [line items] | |
Amortization rates | 5.00% |
Authorizations [Member] | Top Of Range [Member] | |
Disclosure of detailed information about intangible assets [line items] | |
Amortization rates | 50.00% |
Other Assets [Member] | Bottom Of Range [member] | |
Disclosure of detailed information about intangible assets [line items] | |
Amortization rates | 7.00% |
Other Assets [Member] | Top Of Range [Member] | |
Disclosure of detailed information about intangible assets [line items] | |
Amortization rates | 10.00% |
Right To Use Software [Member] | |
Disclosure of detailed information about intangible assets [line items] | |
Amortization rates | 20.00% |
Right To Use Infrastructure Of LT Amazonas [Member] | |
Disclosure of detailed information about intangible assets [line items] | |
Amortization rates | 5.00% |
14. Intangible assets (Detail_2
14. Intangible assets (Details Narrative) - BRL (R$) R$ in Thousands | Jan. 16, 2018 | Jan. 26, 2017 | Apr. 09, 2015 | Sep. 30, 2014 | Aug. 29, 2012 | Dec. 31, 2014 | Dec. 31, 2009 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2005 |
Disclosure of detailed information about intangible assets [line items] | ||||||||||
Nominal amount | R$ 1500000 | |||||||||
4G License 700 MHz [Member] | ||||||||||
Disclosure of detailed information about intangible assets [line items] | ||||||||||
Subsidiary purchased Lot 2 | R$ 1739 | R$ 1678 | ||||||||
Remaining amount recorded as debt | R$ 61 | |||||||||
Interest rate | 1.00% | |||||||||
Interest cost | R$ 1636 | R$ 5611 | ||||||||
Interest cost on monetary adjustments | 735 | 5,930 | ||||||||
Nominal amount | 904 | |||||||||
Additional cost on long-term obligations | 295 | |||||||||
Amount payable for long-term obligations | 1,199,000 | |||||||||
Amount payable to reduced the adjustment present value | R$ 47 | |||||||||
Payments made for long-term obligations | R$ 142862 | R$ 858991 | R$ 370379 | |||||||
Capitalized average rate | 6.90% | |||||||||
Borrowing capitalized cost | R$ 38375 | R$ 152480 | ||||||||
Interest capitalized | 40,011 | |||||||||
Total auction amount | 1,199,000,000 | |||||||||
TIM S.A [Member] | ||||||||||
Disclosure of detailed information about intangible assets [line items] | ||||||||||
Acquisition of goodwill | R$ 210015 | |||||||||
TIM Fiber SP Ltda. and TIM Fiber RJ. S.A. [Member] | ||||||||||
Disclosure of detailed information about intangible assets [line items] | ||||||||||
Acquisition of goodwill | R$ 1159648 | |||||||||
TIM Sul and TIM Nordeste [Member] | ||||||||||
Disclosure of detailed information about intangible assets [line items] | ||||||||||
Acquisition of goodwill | R$ 157556 | |||||||||
Right To Use Infrastructure Of LT Amazonas [Member] | ||||||||||
Disclosure of detailed information about intangible assets [line items] | ||||||||||
Borrowing capitalized cost | 28,874 | |||||||||
Authorizations [Member] | ||||||||||
Disclosure of detailed information about intangible assets [line items] | ||||||||||
Nominal amount | R$ 109770 |
15. Financiale leases (Details)
15. Financiale leases (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure of financial assets [line items] | ||
Finance lease receivables | R$ 156378 | R$ 208049 |
Current portion | (4,931) | (22,491) |
Non-current portion | 151,447 | 185,558 |
LT Amazonas [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease receivables | R$ 156378 | R$ 208049 |
15. Financiale leases (Details
15. Financiale leases (Details 1) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure of financial assets [line items] | ||
Nominal amount | R$ 1500000 | |
Present value | 156,378 | R$ 208049 |
LT Amazonas [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 316,641 | |
Present value | 156,378 | R$ 208049 |
LT Amazonas [Member] | January 2020 to December 2020 [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 23,206 | |
Present value | 4,931 | |
LT Amazonas [Member] | January 2021 To December 2024 [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 92,826 | |
Present value | 58,081 | |
LT Amazonas [Member] | January 2025 Onwards [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 200,609 | |
Present value | R$ 93366 |
15. Financiale leases (Detail_2
15. Financiale leases (Details 2) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure of financial assets [line items] | ||
Finance lease liabilities | R$ 1584802 | R$ 1940074 |
Total | 7,780,870 | 1,940,074 |
Current portion | (873,068) | (205,048) |
Non-current portion | 6,907,802 | 1,735,026 |
LT Amazonas [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease liabilities | 276,233 | 359,987 |
Sale of Towers (Leaseback) [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease liabilities | 1,192,596 | 1,501,695 |
Other [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease liabilities | 115,973 | 78,392 |
Lease Operation - Network [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease liabilities | 3,294,261 | |
Lease Operation - Vehicles [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease liabilities | 3,005 | |
Lease Operation - Stores And Kiosks [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease liabilities | 255,857 | |
Lease - Properties [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease liabilities | 243,921 | |
Lease - Land (Network) [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease liabilities | 1,600,456 | |
Lease Operation - Fiber [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease liabilities | 798,568 | |
Subtotal (IFRS 16) [Member] | ||
Disclosure of financial assets [line items] | ||
Finance lease liabilities | R$ 6196068 |
15. Financiale leases (Detail_3
15. Financiale leases (Details 3) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure of financial assets [line items] | ||
Present value | R$ 1584802 | R$ 1940074 |
LT Amazonas [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 601,555 | |
Present value | 276,233 | R$ 359987 |
LT Amazonas [Member] | January 2020 to December 2020 [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 44,079 | |
Present value | 8,451 | |
LT Amazonas [Member] | January 2021 To December 2024 [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 176,315 | |
Present value | 103,464 | |
LT Amazonas [Member] | January 2025 Onwards [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 381,161 | |
Present value | R$ 164318 |
15. Financiale leases (Detail_4
15. Financiale leases (Details 4) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure of financial assets [line items] | ||
Present value | R$ 1584802 | R$ 1940074 |
Sale of Towers (Leaseback) [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 2,930,363 | |
Present value | 1,192,596 | R$ 1501695 |
Sale of Towers (Leaseback) [Member] | January 2020 to December 2020 [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 187,720 | |
Present value | 32,734 | |
Sale of Towers (Leaseback) [Member] | January 2021 To December 2024 [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 750,881 | |
Present value | 449,470 | |
Sale of Towers (Leaseback) [Member] | January 2025 Onwards [Member] | ||
Disclosure of financial assets [line items] | ||
Nominal amount | 1,991,762 | |
Present value | R$ 710392 |
15. Financiale leases (Detail_5
15. Financiale leases (Details 5) R$ in Thousands | Dec. 31, 2019BRL (R$) |
Disclosure of financial assets [line items] | |
Nominal amount | R$ 9289474 |
Present values | 6,196,068 |
Up to December 2020 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 1,388,262 |
January 2021 To December 2024 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 4,284,210 |
January 2025 Onwards [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 3,617,001 |
Lease Operation - Network [Member] | |
Disclosure of financial assets [line items] | |
Nominal amount | 4,974,341 |
Present values | 3,294,261 |
Lease Operation - Network [Member] | Up to December 2020 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 623,670 |
Lease Operation - Network [Member] | January 2021 To December 2024 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 2,291,331 |
Lease Operation - Network [Member] | January 2025 Onwards [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 2,059,339 |
Lease Operation - Vehicles [Member] | |
Disclosure of financial assets [line items] | |
Nominal amount | 7,886 |
Present values | 3,005 |
Lease Operation - Vehicles [Member] | Up to December 2020 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 5,039 |
Lease Operation - Vehicles [Member] | January 2021 To December 2024 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 2,848 |
Lease Operation - Vehicles [Member] | January 2025 Onwards [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | |
Lease Operation - Stores And Kiosks [Member] | |
Disclosure of financial assets [line items] | |
Nominal amount | 309,721 |
Present values | 255,857 |
Lease Operation - Stores And Kiosks [Member] | Up to December 2020 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 82,958 |
Lease Operation - Stores And Kiosks [Member] | January 2021 To December 2024 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 174,338 |
Lease Operation - Stores And Kiosks [Member] | January 2025 Onwards [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 52,426 |
Lease - Properties [Member] | |
Disclosure of financial assets [line items] | |
Nominal amount | 384,452 |
Present values | 243,921 |
Lease - Properties [Member] | Up to December 2020 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 51,317 |
Lease - Properties [Member] | January 2021 To December 2024 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 176,575 |
Lease - Properties [Member] | January 2025 Onwards [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 156,560 |
Lease - Land (Network) [Member] | |
Disclosure of financial assets [line items] | |
Nominal amount | 2,682,660 |
Present values | 1,600,456 |
Lease - Land (Network) [Member] | Up to December 2020 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 298,389 |
Lease - Land (Network) [Member] | January 2021 To December 2024 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 1,035,594 |
Lease - Land (Network) [Member] | January 2025 Onwards [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 1,348,676 |
Lease Operation - Fiber [Member] | |
Disclosure of financial assets [line items] | |
Nominal amount | 930,414 |
Present values | 798,568 |
Lease Operation - Fiber [Member] | Up to December 2020 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 326,889 |
Lease Operation - Fiber [Member] | January 2021 To December 2024 [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations | 603,524 |
Lease Operation - Fiber [Member] | January 2025 Onwards [Member] | |
Disclosure of financial assets [line items] | |
Total other lease operations |
15. Financiale leases (Detail_6
15. Financiale leases (Details Narrative) R$ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019BRL (R$)Number | Dec. 31, 2017BRL (R$)Number | Dec. 31, 2016Number | Dec. 31, 2015Number | Dec. 31, 2018BRL (R$) | |
Disclosure of financial assets [line items] | |||||
Finance lease receivables | R$ 156378 | R$ 208049 | |||
Leasing - liabilities | 1,584,802 | 1,940,074 | |||
Interest paid | R$ 21210 | R$ 497836 | |||
Finance lease liabilities interest rate | 10.55% | ||||
Deferred revenue | R$ 1109112 | 1,313,467 | |||
Number of transfer of towers | Number | 54 | 336 | 5,483 | ||
Rental expense | 82,110 | ||||
Balances under IFRS 16 [Member] | |||||
Disclosure of financial assets [line items] | |||||
Interest paid | 21,210 | ||||
Two Sales Agreements [Member] | TIM Celular S.A. ("TIM Celular") [Member] | |||||
Disclosure of financial assets [line items] | |||||
Owned amount of telecommunications towers | R$ 3000000 | ||||
Maximum number of towers owned | Number | 6,481 | ||||
LT Amazonas [Member] | |||||
Disclosure of financial assets [line items] | |||||
Finance lease receivables | R$ 156378 | 208,049 | |||
Finance lease interest accrued | R$ 48991 | ||||
Finance lease receivables interest rate | 12.56% | ||||
LT Amazonas [Member] | |||||
Disclosure of financial assets [line items] | |||||
Leasing - liabilities | R$ 276233 | 359,987 | |||
Finance lease principal | R$ 601555 | ||||
Finance lease liabilities interest rate | 14.44% | ||||
Right to use | R$ 70759 | ||||
Nominal amount | 601,555 | ||||
Sale of Towers (Leaseback) [Member] | |||||
Disclosure of financial assets [line items] | |||||
Leasing - liabilities | 1,192,596 | 1,501,695 | |||
Nominal amount | 2,930,363 | ||||
Sales | R$ 2651247 | ||||
Deferred revenue | R$ 1088390 | ||||
Sale of Towers (Leaseback) [Member] | Bottom Of Range [member] | |||||
Disclosure of financial assets [line items] | |||||
Finance lease liabilities interest rate | 11.01% | ||||
Sale of Towers (Leaseback) [Member] | Top Of Range [Member] | |||||
Disclosure of financial assets [line items] | |||||
Finance lease liabilities interest rate | 17.08% |
16. Regulatory credits recove_2
16. Regulatory credits recoverable (Details Narrative) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Regulatory Credits Recoverable [Abstract] | ||
Regulatory credits recoverable | R$ 33090 | R$ 41612 |
17. Suppliers (Details)
17. Suppliers (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Suppliers [Line Items] | |||
Current portion | R$ 3923035 | R$ 4323374 | |
Local Currency [Member] | |||
Suppliers [Line Items] | |||
Current portion | 3,769,298 | 4,158,599 | |
Local Currency [Member] | Suppliers Of Materials And Services [Member] | |||
Suppliers [Line Items] | |||
Current portion | [1] | 3,667,152 | 4,027,092 |
Local Currency [Member] | Inter Connection [Member] | |||
Suppliers [Line Items] | |||
Current portion | [2] | 67,396 | 98,060 |
Local Currency [Member] | Roaming [Member] | |||
Suppliers [Line Items] | |||
Current portion | [3] | 441 | 162 |
Local Currency [Member] | Co-Billing [Member] | |||
Suppliers [Line Items] | |||
Current portion | [4] | 34,309 | 33,285 |
Foreign Currency [Member] | |||
Suppliers [Line Items] | |||
Current portion | 153,737 | 164,775 | |
Foreign Currency [Member] | Roaming [Member] | |||
Suppliers [Line Items] | |||
Current portion | [3] | 37,680 | 27,378 |
Foreign Currency [Member] | Suppliers Of Materials And Services [Member] | |||
Suppliers [Line Items] | |||
Current portion | [1] | R$ 153737 | R$ 137397 |
[1] | Represent the amounts to be paid to suppliers for acquisitions of materials and for the provision of services relating to tangible and intangible assets or for consumption in operations, maintenance and management, as provided for in the agreement between the parties. | ||
[2] | This refers to the use of the networks of other landline and mobile telephone operators, with calls being initiated from TIM's network and ending on the networks of other operators. | ||
[3] | This refers to calls made by customers outside their registration area, who are therefore considered visitors to other operator networks. | ||
[4] | This refers to calls made by a customer who has used another long-distance operator. |
18. Authorizations payable (Det
18. Authorizations payable (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Authorizations Payable [Abstract] | |||
Renewal of authorizations | [1] | R$ 199363 | R$ 300253 |
Updated ANATEL liability | [2] | 126,974 | 113,547 |
Authorizations payable | 326,337 | 413,800 | |
Current portion | (88,614) | (65,464) | |
Non-current portion | R$ 237723 | R$ 348336 | |
[1] | In order to provide SMP services, the subsidiary obtained radio frequency authorizations for a fixed period, renewable for a further 15 years. The extension of the right-of-use includes the payment of 2% of the net revenue recorded in the regions covered by the authorization that ends every two years. As at December 31, 2019, the subsidiary had balance due related to the renewal of authorizations in the amount of R$199,363 (R$300,253 as at December 31, 2018). | ||
[2] | On December 05, 2014 the subsidiary signed an Authorization Instrument for the 700 MHz band and paid an amount equivalent to R$1,678 million, recording the remaining balance of R$61 million as a trade liability, according to the payment method provided for in the call notice. Due to the absence of bids for some lots in the Call Notice for the 700 MHZ band, the subsidiary, along with other bidders, had to bear a proportion of the costs of these lots. Thus, the EAD was organized, with respect to which the total commitment assumed by the subsidiary was R$1,199 million. This amount was paid in four installments adjusted by the IGP-DI (Daily General Price Index) (Note 14.f). |
18. Authorizations payable (D_2
18. Authorizations payable (Details 1) - TIM Celular S.A. ("TIM Celular") [Member] | 12 Months Ended | |
Dec. 31, 2019 | ||
Amapa Roraima Para Amazonas And Maranhao [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | March, 2031* | [1] |
Additional frequencies 1,800 MHz | April, 2023 | |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
2,500 MHz (P Band (4G) | Part of AR92 (PA) - February, 2024* | [1],[2] |
700 MHz (4G) | December, 2029 | |
Rio De Janeiro And Espirito Santo [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
450 MHz | October, 2027 | |
800 MHz, 900 MHz and 1,800 MHz | March, 2031* | [1] |
Additional frequencies 1,800 MHz | ES - April, 2023 | |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
2,500 MHz (P Band (4G) | Part of AR21 (RJ) - February, 2024* | [1],[2] |
700 MHz (4G) | December, 2029 | |
Acre Rondonia Mato Grosso Mato Grosso Do Sul Tocantins Distrito Federal Goias Rio Grande Do Sul (Except The Municipality Of Pelotas And Region) And The Municipalities Of Londrina And Tamarana In Parana [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
450 MHz | PR - October, 2027 | |
800 MHz, 900 MHz and 1,800 MHz | March, 2031* | [1] |
Additional frequencies 1,800 MHz | April, 2023 | |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
2,500 MHz (P Band (4G) | Part of AR61 (DF) - February, 2024* | [1],[2] |
700 MHz (4G) | December, 2029 | |
Sao Paulo [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | March, 2031* | [1] |
Additional frequencies 1,800 MHz | Countryside - April, 2023 | |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
700 MHz (4G) | December, 2029 | |
Parana (Except The Municipalities Of Londrina And Tamarana) [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
450 MHz | October, 2027 | |
800 MHz, 900 MHz and 1,800 MHz | September, 2022* | [1] |
Additional frequencies 1,800 MHz | April, 2023 | |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
2,500 MHz (P Band (4G) | AR41, except Curitiba and Metropolitan Region - February, 2024* | [1],[2] |
700 MHz (4G) | December, 2029 | |
Santa Catarina [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
450 MHz | October, 2027 | |
800 MHz, 900 MHz and 1,800 MHz | September, 2023* | [1] |
Additional frequencies 1,800 MHz | April, 2023 | |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
700 MHz (4G) | December, 2029 | |
Municipality And Region Of Pelotas In The State Of Rio Grande Do Sul [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | April, 2024* | [1] |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
700 MHz (4G) | December, 2029 | |
Pernambuco [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | May, 2024* | [1] |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
2,500 MHz (P Band (4G) | Part of AR81-July, 2031 | [2] |
700 MHz (4G) | December, 2029 | |
Ceara [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | November, 2023* | [1] |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
700 MHz (4G) | December, 2029 | |
Paraiba [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | December, 2023* | [1] |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
700 MHz (4G) | December, 2029 | |
Rio Grande Do Norte [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | December, 2023* | [1] |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
700 MHz (4G) | December, 2029 | |
Alagoas [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | December, 2023* | [1] |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
700 MHz (4G) | December, 2029 | |
Piaui [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | March, 2024* | [1] |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
700 MHz (4G) | December, 2029 | |
Minas Gerais (Except The Municipalities Of The PGO Sector 3 For 3G The Radio Frequencies And Others) [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | April, 2028* | [1] |
Additional frequencies 1,800 MHz | April, 2023 | |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
2,500 MHz (P Band (4G) | Part of AR31 - February, 2030* | [1],[2] |
700 MHz (4G) | December, 2029 | |
Bahia And Sergipe [Member] | ||
AuthorizationsPayableLineItems [Line Items] | ||
800 MHz, 900 MHz and 1,800 MHz | August, 2027* | [1] |
1,900 MHz and 2,100 MHz (3G) | April, 2023 | |
2,500 MHz V1 Band (4G) | October, 2027 | |
700 MHz (4G) | December, 2029 | |
[1] | Agreements already renewed for 15 years, and therefore TIM is not entitled to a further renewal period. | |
[2] | Only complementary areas in some specific States. |
18. Authorizations payable (D_3
18. Authorizations payable (Details Narrative) R$ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019BRL (R$) | Dec. 31, 2018BRL (R$) | Jun. 30, 2015BRL (R$) | Dec. 05, 2014BRL (R$)Number | ||
AuthorizationsPayableLineItems [Line Items] | |||||
Renewal of authorizations | [1] | R$ 199363 | R$ 300253 | ||
Authorizations payable | R$ 326337 | 413,800 | |||
Civil Proceedings - ANATEL [Member] | |||||
AuthorizationsPayableLineItems [Line Items] | |||||
Renewal term | 15 years | ||||
Percentage of revenue | 2.00% | ||||
Maturity term of authorization | 2 years | ||||
Authorizations payable | R$ 199363 | R$ 300253 | |||
Civil Proceedings - ANATEL [Member] | Authorization Instrument [Member] | |||||
AuthorizationsPayableLineItems [Line Items] | |||||
Authorizations payable | R$ 1678000 | ||||
Number of band | Number | 700 | ||||
Remaining authorizations payable | R$ 61000 | ||||
Total commitment | R$ 1199000 | ||||
Surplus charges | R$ 127000 | R$ 61000 | |||
[1] | In order to provide SMP services, the subsidiary obtained radio frequency authorizations for a fixed period, renewable for a further 15 years. The extension of the right-of-use includes the payment of 2% of the net revenue recorded in the regions covered by the authorization that ends every two years. As at December 31, 2019, the subsidiary had balance due related to the renewal of authorizations in the amount of R$199,363 (R$300,253 as at December 31, 2018). |
19. Borrowing and financing (De
19. Borrowing and financing (Details) - BRL (R$) R$ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jan. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Disclosure of detailed information about borrowings [line items] | ||||
Maturity | The issue aimed at reinforcing the Company's working capital and will mature in July 2020, being remunerated at 104.10% CDI. | |||
Total | R$ 2029088 | R$ 1663017 | ||
Current | (1,384,180) | (698,728) | ||
Non-current | R$ 644908 | 964,289 | ||
Banco Nacional de Desenvolvimento Economico e Social [Member] | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Currency | URTJLP | |||
Charges | TJLP to TJLP + 2,52 % p.a. | |||
Maturity | Jul/22 | |||
Total | [1] | R$ 240008 | 578,312 | |
Banco Nacional de Desenvolvimento Economico e Social [Member] | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Currency | UM143 | |||
Charges | SELIC + 2.52% p.a. | |||
Maturity | Jul/22 | |||
Total | [1] | R$ 374461 | 489,421 | |
BNDES Investment Sustainment Program (BNDES PSI) [Member] | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Currency | R$ | |||
Charges | 3.50% p.a. | |||
Maturity | Jan/21 | |||
Total | [1] | R$ 18071 | 56,804 | |
KfW IPEX [Member] | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Currency | USD | |||
Charges | Libor 6M+ 1.35% p.a. | |||
Maturity | Apr/19 | |||
Total | [2] | 43,420 | ||
KFW Finnvera [Member] | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Currency | USD | |||
Charges | Libor 6M+ 0.75% p.a. | |||
Maturity | Jan/24 to Dec/25 | |||
Total | [2] | R$ 330217 | 378,595 | |
Debentures [Member] | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Currency | R$ | |||
Charges | 104.1% of the CDI | |||
Maturity | Jul/20 | |||
Total | R$ 1025965 | |||
Cisco Capital [Member] | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Currency | USD | |||
Charges | 2.50% p.a. | |||
Maturity | Dec/20 | |||
Total | [3] | R$ 40366 | R$ 116465 | |
[1] | Guaranteed by the holding company TIM Participacoes and collateral of some receivables of the subsidiary. | |||
[2] | Guaranteed by the holding company TIM Participacoes. | |||
[3] | No guarantee. |
19. Borrowing and financing (_2
19. Borrowing and financing (Details 1) - BRL (R$) R$ in Thousands | 1 Months Ended | 12 Months Ended | |
Jan. 31, 2019 | Dec. 31, 2019 | ||
Disclosure of detailed information about borrowings [line items] | |||
Term | The issue aimed at reinforcing the Company's working capital and will mature in July 2020, being remunerated at 104.10% CDI. | ||
Total amount | R$ 1500000 | ||
Undrawn balance | 390,000 | ||
Amount used as at end | R$ 1110000 | ||
Banco Nacional de Desenvolvimento Economico e Social [Member] | |||
Disclosure of detailed information about borrowings [line items] | |||
Currency | URTJLP | ||
Term | Jul/22 | ||
Banco Nacional de Desenvolvimento Economico e Social [Member] | Financing and Credit Facilities One [Member] | |||
Disclosure of detailed information about borrowings [line items] | |||
Currency | [1] | TJLP | |
Date of opening | [1] | May/18 | |
Term | [1] | Dec/19 | |
Total amount | [2] | R$ 1090000 | |
Amount used as at end | [2] | R$ 1090000 | |
Banco Nacional de Desenvolvimento Economico e Social [Member] | Financing and Credit Facilities Two [Member] | |||
Disclosure of detailed information about borrowings [line items] | |||
Currency | [3] | TJLP | |
Date of opening | [3] | May/18 | |
Term | [3] | Dec/19 | |
Total amount | R$ 20000 | ||
Amount used as at end | R$ 20000 | ||
Banco Nacional de Desenvolvimento Economico e Social [Member] | Financing and Credit Facilities Three [Member] | |||
Disclosure of detailed information about borrowings [line items] | |||
Currency | TJLP | ||
Date of opening | Mar/19 | ||
Term | Dec/20 | ||
Total amount | R$ 390000 | ||
Undrawn balance | 390,000 | ||
Amount used as at end | |||
[1] | Support for the TIM investment plan for the years 2017 to 2019 including, but not limited to, the acquisition of Brazilian equipment. | ||
[2] | Investment in social projects involving the community | ||
[3] | Investment in social projects involving the community. |
19. Borrowing and financing (_3
19. Borrowing and financing (Details 2) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure of detailed information about borrowings [line items] | ||
Long-term portions of borrowing and financing | R$ 644908 | R$ 964289 |
2022 [Member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Long-term portions of borrowing and financing | 305,171 | |
2022 [Member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Long-term portions of borrowing and financing | 206,324 | |
2023 [Member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Long-term portions of borrowing and financing | 33,434 | |
2024 [Member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Long-term portions of borrowing and financing | 78,694 | |
2025 [Member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Long-term portions of borrowing and financing | R$ 21285 |
19. Borrowing and financing (_4
19. Borrowing and financing (Details Narrative) - BRL (R$) R$ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jan. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | May 31, 2018 | ||
Disclosure of detailed information about borrowings [line items] | |||||
Maturity | The issue aimed at reinforcing the Company's working capital and will mature in July 2020, being remunerated at 104.10% CDI. | ||||
Third tranche amount | R$ 2029088 | R$ 1663017 | |||
Non-convertible debentures | 1,000,000 | ||||
Banco Nacional de Desenvolvimento Economico e Social [Member] | |||||
Disclosure of detailed information about borrowings [line items] | |||||
Prepaid of debt | R$ 4200000 | ||||
Maturity | Jul/22 | ||||
Amount of credit facility | R$ 1500000 | ||||
Third tranche amount | [1] | R$ 240008 | 578,312 | ||
Finame [Member] | |||||
Disclosure of detailed information about borrowings [line items] | |||||
Amount of credit facility | R$ 3900000 | ||||
Banco Nacional de Desenvolvimento Economico e Social [Member] | |||||
Disclosure of detailed information about borrowings [line items] | |||||
Maturity | Jul/22 | ||||
Description of credit facility | The cost of this line is TLP (Long Term Interest Rate) plus interest of up to 1.44% per year | ||||
Third tranche amount | [1] | R$ 374461 | R$ 489421 | ||
[1] | Guaranteed by the holding company TIM Participacoes and collateral of some receivables of the subsidiary. |
20. Indirect taxes, charges a_3
20. Indirect taxes, charges and contributions payable (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Indirect taxes charges and contributions payable [line items] | ||
Indirect taxes, charges and contributions payable | R$ 466603 | R$ 453941 |
Current portion | (463,606) | (451,169) |
Non-current portion | 2,997 | 2,772 |
Income Tax (IR) And Social Contribution (CS) [Member] | ||
Indirect taxes charges and contributions payable [line items] | ||
Indirect taxes, charges and contributions payable | 377,105 | 361,558 |
Agencia Nacional de Telecomunicacoes ("ANATEL") taxes and fees [Member] | ||
Indirect taxes charges and contributions payable [line items] | ||
Indirect taxes, charges and contributions payable | 22,009 | 21,320 |
Imposto sobre Servicos("ISS") [Member] | ||
Indirect taxes charges and contributions payable [line items] | ||
Indirect taxes, charges and contributions payable | 61,673 | 59,764 |
Others [Member] | ||
Indirect taxes charges and contributions payable [line items] | ||
Indirect taxes, charges and contributions payable | R$ 5816 | R$ 11299 |
21. Direct taxes, charges and_3
21. Direct taxes, charges and contributions payable (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Direct taxes charges and contributions payable [line items] | |||
Direct taxes, charges and contributions payable | R$ 508615 | R$ 542213 | |
Current portion | (296,305) | (332,333) | |
Non-current portion | 212,310 | 209,880 | |
PIS/COFINS [Member] | |||
Direct taxes charges and contributions payable [line items] | |||
Direct taxes, charges and contributions payable | 130,327 | 76,072 | |
Income Tax (IR) And Social Contribution (CS) [Member] | |||
Direct taxes charges and contributions payable [line items] | |||
Direct taxes, charges and contributions payable | 346,097 | 372,467 | |
Others [Member] | |||
Direct taxes charges and contributions payable [line items] | |||
Direct taxes, charges and contributions payable | [1] | R$ 32191 | R$ 93674 |
[1] | The composition of this account refers mainly to the subsidiary's adherence to the Tax Recovery Program - REFIS, as of 2009. For installment payment of debts due on federal taxes (PIS, COFINS, IR and CSLL) whose final maturity will be on October 31, 2024. |
22. Deferred revenue (Details)
22. Deferred revenue (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred revenue [line items] | |||
Deferred revenue, net | R$ 1109112 | R$ 1313467 | |
Current portion | (281,930) | (406,867) | |
Non-current portion | 827,182 | 906,600 | |
Prepaid Services [Member] | |||
Deferred revenue [line items] | |||
Deferred revenue, net | [1] | 186,310 | 301,621 |
Government Grants [Member] | |||
Deferred revenue [line items] | |||
Deferred revenue, net | [2] | 42,159 | 63,731 |
Network Swap [Member] | |||
Deferred revenue [line items] | |||
Deferred revenue, net | [3] | 2,713 | 11,449 |
Anticipated Receipts [Member] | |||
Deferred revenue [line items] | |||
Deferred revenue, net | 11,651 | 18,626 | |
Towers Revenue [Member] | |||
Deferred revenue [line items] | |||
Deferred revenue, net | [4] | 843,017 | 897,112 |
Contractual Liability [Member] | |||
Deferred revenue [line items] | |||
Deferred revenue, net | [5] | R$ 23262 | R$ 20928 |
[1] | This refers to the reloading of voice and data credits not yet used by customers involving prepaid system services, which are appropriated to income when customers actually avail themselves of these services. | ||
[2] | Refers to the release of funds under the credit facility from the BNDES Investment Sustainment Program. The total sum of the subsidies granted by the BNDES through December 31, 2019, was R$203 million and the amount outstanding at December 31, 2019 and R$42,159 (63,731 at December 31, 2018). This amount is being amortized according to the useful life of the asset being financed and appropriated to the ""Other income (expenses), net"" (Note 28). | ||
[3] | Refers mainly to the transfer of onerous contracts and reciprocal fiber optic infrastructure (Note 11). | ||
[4] | Refers to amounts to be appropriated from sales of towers (Note 15). | ||
[5] | Contracts with customers. |
22. Deferred revenue (Details 1
22. Deferred revenue (Details 1) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred Revenues [Abstract] | ||
Accounts receivable included in trade accounts receivable | R$ 3287855 | R$ 2969116 |
Contractual asset (note 6) | 15,142 | 130 |
Contractual liabilities | R$ 23262 | R$ 20928 |
22. Deferred revenue (Details 2
22. Deferred revenue (Details 2) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred Revenues [Abstract] | ||
Balances as at January 1, 2019 | R$ 20798 | R$ 12305 |
Additions | 1,845 | (23,545) |
Write-offs | 10,833 | 15,052 |
Balances as at December 31, 2019 | R$ 8120 | R$ 20798 |
22. Deferred revenue (Details 3
22. Deferred revenue (Details 3) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Disclosure of changes in accounting estimates [line items] | |||
Contractual asset (liability) | R$ 8120 | R$ 20798 | R$ 12305 |
2020 [Member] | |||
Disclosure of changes in accounting estimates [line items] | |||
Contractual asset (liability) | (5,953) | ||
2021 [Member] | |||
Disclosure of changes in accounting estimates [line items] | |||
Contractual asset (liability) | R$ 2167 |
22. Deferred revenue (Details N
22. Deferred revenue (Details Narrative) - Banco Nacional de Desenvolvimento Economico e Social [Member] - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred revenue [line items] | ||
Subsidies granted | R$ 203000 | |
Subsidies granted outstanding | R$ 42159 | R$ 63731 |
23. Provision for legal and a_3
23. Provision for legal and administrative proceedings (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Provision for legal and administrative proceedings [line items] | |||
Provision for legal and administrative proceedings | R$ 840637 | R$ 849408 | R$ 528320 |
Provision For Civil [Member] | |||
Provision for legal and administrative proceedings [line items] | |||
Provision for legal and administrative proceedings | 212,702 | 111,301 | 132,422 |
Provision For Labor [Member] | |||
Provision for legal and administrative proceedings [line items] | |||
Provision for legal and administrative proceedings | 261,837 | 435,438 | 184,311 |
Tax [Member] | |||
Provision for legal and administrative proceedings [line items] | |||
Provision for legal and administrative proceedings | 333,717 | 271,214 | 180,643 |
Provision For Regulatory [Member] | |||
Provision for legal and administrative proceedings [line items] | |||
Provision for legal and administrative proceedings | R$ 32381 | R$ 31455 | R$ 30944 |
23. Provision for legal and a_4
23. Provision for legal and administrative proceedings (Details 1) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Provision for legal and administrative proceedings [line items] | ||
Beginning balance | R$ 849408 | R$ 528320 |
Additions, net of reversals | 547,691 | 551,191 |
Payments | (715,203) | (536,647) |
Monetary adjustment | 158,741 | 306,544 |
Ending balance | 840,637 | 849,408 |
Provision For Civil [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Beginning balance | 111,301 | 132,422 |
Additions, net of reversals | 348,012 | 239,705 |
Payments | (335,640) | (324,803) |
Monetary adjustment | 89,028 | 63,977 |
Ending balance | 212,702 | 111,301 |
Provision For Labor [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Beginning balance | 435,438 | 184,311 |
Additions, net of reversals | 96,235 | 225,864 |
Payments | (301,971) | (114,450) |
Monetary adjustment | 32,136 | 139,713 |
Ending balance | 261,837 | 435,438 |
Tax [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Beginning balance | 271,214 | 180,643 |
Additions, net of reversals | 103,354 | 84,990 |
Payments | (77,341) | (96,346) |
Monetary adjustment | 36,490 | 101,927 |
Ending balance | 333,717 | 271,214 |
Provision For Regulatory [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Beginning balance | 31,455 | 30,944 |
Additions, net of reversals | 90 | 632 |
Payments | (251) | (1,048) |
Monetary adjustment | 1,087 | 927 |
Ending balance | R$ 32381 | R$ 31455 |
23. Provision for legal and a_5
23. Provision for legal and administrative proceedings (Details 2) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Provision for legal and administrative proceedings [line items] | |||
Tax process | R$ 840637 | R$ 849408 | R$ 528320 |
Tax [Member] | |||
Provision for legal and administrative proceedings [line items] | |||
Tax process | 333,717 | 271,214 | R$ 180643 |
Tax [Member] | Federal Taxes [Member] | |||
Provision for legal and administrative proceedings [line items] | |||
Tax process | 155,495 | 82,033 | |
Tax [Member] | State Taxes [Member] | |||
Provision for legal and administrative proceedings [line items] | |||
Tax process | 93,790 | 103,546 | |
Tax [Member] | Municipal Taxes [Member] | |||
Provision for legal and administrative proceedings [line items] | |||
Tax process | 8,227 | 1,713 | |
Tax [Member] | Tim S.A. Proceedings (Purchase Price Allocation) [Member] | |||
Provision for legal and administrative proceedings [line items] | |||
Tax process | R$ 76205 | R$ 83922 |
23. Provision for legal and a_6
23. Provision for legal and administrative proceedings (Details 3) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Provision for legal and administrative proceedings [line items] | ||
Estimated financial effect of contingent liabilities | R$ 18395727 | R$ 18734644 |
Provision For Civil [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Estimated financial effect of contingent liabilities | 1,032,637 | 1,046,521 |
Provision For Labor [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Estimated financial effect of contingent liabilities | 459,020 | 523,236 |
Tax [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Estimated financial effect of contingent liabilities | 16,196,077 | 16,530,061 |
Provision For Regulatory [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Estimated financial effect of contingent liabilities | R$ 707993 | R$ 634826 |
23. Provision for legal and a_7
23. Provision for legal and administrative proceedings (Details 4) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Provision for legal and administrative proceedings [line items] | ||
Total | R$ 18395727 | R$ 18734644 |
Civil [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | 1,032,637 | 1,046,521 |
Civil [Member] | Actions Filed By Consumers [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | 374,860 | 405,635 |
Civil [Member] | ANATEL [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | 220,526 | 207,657 |
Civil [Member] | Consumer Protection Agencies [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | 32,847 | 84,231 |
Civil [Member] | Former Trade Partners [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | 180,226 | 173,213 |
Civil [Member] | Social And Environmental, And Infrastructure [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | 125,201 | 71,574 |
Civil [Member] | Other [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | R$ 98977 | R$ 104211 |
23. Provision for legal and a_8
23. Provision for legal and administrative proceedings (Details 5) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Provision for legal and administrative proceedings [line items] | ||
Total | R$ 18395727 | R$ 18734644 |
Tax [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | 16,196,077 | 16,530,061 |
Tax [Member] | FUST, FUNTTEL and EBC [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | 2,991,567 | 2,979,404 |
Tax [Member] | Federal Taxes [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | 4,279,570 | 3,952,125 |
Tax [Member] | State Taxes [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | 8,221,808 | 8,904,916 |
Tax [Member] | Municipal Taxes [Member] | ||
Provision for legal and administrative proceedings [line items] | ||
Total | R$ 703132 | R$ 693616 |
23. Provision for legal and a_9
23. Provision for legal and administrative proceedings (Details Narrative) R$ in Thousands | 1 Months Ended | 12 Months Ended | ||
Aug. 22, 2019BRL (R$) | Dec. 31, 2019BRL (R$)Number | Dec. 31, 2018BRL (R$)Number | Dec. 31, 2017BRL (R$) | |
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | R$ 18395727 | R$ 18734644 | ||
Provision amounts | 840,637 | 849,408 | R$ 528320 | |
Nominal amount | R$ 1500000 | |||
ANATEL [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Percentage of revenue | 2.00% | |||
Civil Proceedings - ANATEL [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | R$ 1340 | 1,270 | ||
Percentage of revenue | 2.00% | |||
Civil Proceedings - Social, Environmental And Infrastructure [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | R$ 498 | 239 | ||
Civil Proceedings - Others [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 27,039 | 3,060 | ||
Civil Proceedings - Former Trade Partners [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 12,812 | 10,378 | ||
Civil Proceedings - PROCON [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 31,221 | 5,814 | ||
Consumer Lawsuits Claim [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | R$ 135290 | R$ 86039 | ||
Labor Proceedings - Former Employees [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Number of labour claims | Number | 2,408 | 3,948 | ||
Estimated financial effect of contingent liabilities | R$ 252968 | R$ 426570 | ||
Labor Claims - Former Employees [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Number of labour claims | Number | 3,976 | 4,654 | ||
Estimated financial effect of contingent liabilities | R$ 459020 | R$ 523236 | ||
Tax Claim Municipal Taxes - Constitutionality of the Collection of the TFF By Municipal Authorities in Several Locations [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 120,503 | 118,114 | ||
Tax Claim State Taxes - Collection of ICMS Tax on Subscription Services [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 249,659 | 139,758 | ||
Tax Claim Municipal Taxes - Collection Of ISS On Imports Of Services [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 300,669 | 283,620 | ||
Tax Claim Municipal Taxes - Payment of ISS & Punitive Fine For Failure To Pay Alleged Tax [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 147,572 | 142,355 | ||
Regulatory Contingent Liability [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 707,993 | 634,826 | ||
Tax Claim State Taxes - Credits booked For The Return Of Cell Phones On Free Leases [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 180,920 | 177,128 | ||
Tax Claim State Taxes - Undue ICMS Credit [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 198,505 | 192,074 | ||
Tax Claim State Taxes - Penalty Claimed on Errors or Inconsistencies on Ancillary Obligations [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 138,684 | 116,880 | ||
Tax Claim State Taxes - Use of Credit to Purchase Electricity [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 140,368 | R$ 140368 | ||
Tax Claim State Taxes - ICMS Credits Booked & Debits Reversed [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 3,284,473 | 3,340,448 | ||
Tax Claim State Taxes - Credit Reversal & Late Use of Credit for Purchase of Fixed Assets [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 731,864 | 767,142 | ||
Federal Taxes [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 4,279,570 | 3,952,125 | ||
Provision amounts | 9,560 | 9,335 | ||
Tax Claim State Taxes - Alleged Undue Crediting Of ICMS [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 88,767 | 1,110,827 | ||
State Taxes [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 8,221,808 | 8,904,916 | ||
Provision amounts | 15,460 | |||
Provision of telecommunication services | 23,558 | 42,628 | ||
Discount offered | 1,053,411 | 1,344,288 | ||
Tax Contingent Liability [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 427,233 | 412,715 | ||
Municipal Taxes [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 703,132 | 693,616 | ||
FUST, FUNTTEL & EBC [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Provision amounts | 14,564 | 14,060 | ||
Tax Claim Federal Taxes - Overseas Remittances [Member] | TIM Celular S.A. ("TIM Celular") [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 256,833 | 296,589 | ||
Tax Claim Federal Taxes - Collection of CSLL [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 66,164 | 64,537 | ||
Labor Claims - Closure of the Client Relationship Centers [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 14,349 | 16,709 | ||
Tax Claim Federal Taxes - Method of Offsetting Tax Losses & Negative Bases [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 203,302 | 198,175 | ||
Tax Claim Federal Taxes - Improper Use of SUDENE Benefits [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 2,672,754 | 2,543,851 | ||
Labor Claims - Social Security [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 9,693 | |||
Tax Claim FUST and FUNTTEL [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 2,991,567 | 2,979,404 | ||
Labor Claims - Intelig [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 1,559 | 1,430 | ||
Labor Proceedings - Former Employees [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Estimated financial effect of contingent liabilities | 57,859 | 27,981 | ||
Municipal Taxes [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Provision amounts | 76,205 | 83,922 | ||
Cancellation of telecommunications | 32,381 | 31,455 | ||
Social Security [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Payment of social security contributions | 538 | 538 | ||
Tax adjustment amount | 11,549,274 | 11,662,216 | ||
Social Security Contribution [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Provision amounts | R$ 37977 | 36,685 | ||
Percentage of provision | 11.00% | |||
The National Telecommunications Agency [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Provision amounts | R$ 58116 | 0 | ||
Provision of telecommunication services | 5,037 | R$ 4829 | ||
Income Taxes Contingencies [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Tax litigations | R$ 3474714 | |||
Board Of Directors [Member] | ANATEL [Member] | ||||
Provision for legal and administrative proceedings [line items] | ||||
Nominal amount | R$ 627000 | |||
Description of additional commitment | Additional commitment to bring mobile broadband through the 4G network to 366 municipalities with less than 30,000 inhabitants reaching over 3.4 million people. | |||
Description of infrastruce implemented | The new infrastructure will be implemented in three years - more than 80% in the first two years -with the sharing regime with the other providers being guaranteed by the Company. |
24. Shareholders' equity (Detai
24. Shareholders' equity (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Shareholders' equity | ||
Net value paid up | R$ 9866298 | R$ 9866298 |
Value paid up | 9,913,415 | 9,913,415 |
Funding costs | R$ 47117 | R$ 47117 |
Number of common shares | 2,421,032,479 | 2,421,032,479 |
24. Shareholders' equity (Det_2
24. Shareholders' equity (Details 1) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 30, 2009 |
Shareholders' equity | |||
Capital reserves | R$ 410650 | R$ 412091 | R$ 223004 |
Special goodwill reserve | 380,560 | 380,560 | |
Stock options | R$ 30090 | R$ 31531 |
24. Shareholders' equity (Det_3
24. Shareholders' equity (Details 2) - BRL (R$) R$ / shares in Units, R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Shareholders' equity | |||
Net income for the year | R$ 3622127 | R$ 2545101 | R$ 1234507 |
Tax incentives not to be distributed | (194,161) | (146,455) | |
Legal reserve constitution | (171,398) | (119,932) | |
Revised profit | 3,256,568 | 2,278,714 | |
Dividends to be distributed: | |||
Minimum dividends calculated considering 25% of the revised profit | 814,142 | 569,679 | |
Breakdown of dividends payable and interest on equity: | |||
Interest on shareholders' equity | 995,438 | 849,994 | R$ 189991 |
Total dividends and interest on shareholders' equity distributed and proposed | 995,438 | 849,994 | |
IRRF on interest on shareholders' equity | (149,316) | (125,757) | |
Total dividends and interest on shareholders' equity, net | R$ 846122 | R$ 724237 | |
Dividends per share (Reais per share), net of IRRF | R$ 0.35 | R$ 0.3 |
24. Shareholders' equity (Det_4
24. Shareholders' equity (Details Narrative) - BRL (R$) R$ / shares in Units, R$ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 02, 2020 | Dec. 30, 2009 | |
Number of shares authorised | 4,450,000,000 | ||||
Number of share issued | 2,421,032,479 | 2,421,032,479 | |||
Goodwill | R$ 157556 | R$ 516725 | |||
Number of shares sold | 668,367 | 1,194,576 | |||
Capital reserves | R$ 410650 | R$ 412091 | 223,004 | ||
Book value | R$ 739729 | ||||
Mandatory dividend percentage | 25.00% | ||||
Exercise options (in R$ per share) | R$ 10.86 | R$ 10.34 | |||
Purchase of shares | 115,949 | 377,052 | |||
Value of shares purchased | R$ 3204 | R$ 4389 | |||
Number of treasury share purchased | 5,319 | 7,964 | |||
Share price (in R$ per share) | R$ 15.22 | R$ 11.64 | |||
Accumulated amount of benefits | R$ 1612019 | R$ 1417858 | |||
Provision of interest | 995,438 | 313,600 | |||
Interest paid | R$ 96649 | R$ 193333 | R$ 380005 | ||
Subsequent Event [Member] | |||||
Capital reserves | R$ 1644013 | ||||
Stock Option Plan [Member] | |||||
Number of treasury share purchased | 210,527 | 784,317 | |||
Holdco Participacoes LTDA [Member] | |||||
Number of share issued | 127,288,023 | ||||
Proportion of ownership interests | 100.00% |
25. Long-term incentive plan (D
25. Long-term incentive plan (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
LongtermIncentivePlanLineItems [Line Items] | ||
Share options granted | R$ 19313478 | R$ 18382816 |
Balance at the beginning of the period | 2,730,114 | 5,473,436 |
Granted in the period | 930,662 | 849,932 |
Exercised in the period | (784,317) | (1,194,576) |
Forfeited in the period | (251,821) | (2,203,922) |
Falling due in the period | (543,583) | (194,756) |
Balance at the end of the period | R$ 2081055 | 2,730,114 |
Excercise Price R$11.28 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2018-2020 Plan - 2ª Grant | |
Share options granted | R$ 930662 | |
Maturity date | Jul-22 | |
Balance at the beginning of the period | ||
Granted in the period | 930,662 | |
Exercised in the period | ||
Forfeited in the period | (33,418) | |
Falling due in the period | ||
Balance at the end of the period | R$ 897244 | |
Excercise Price R$14.41 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2018-2020 Plan – 1st Grant | 2018-2020 Plan – 1st Grant |
Share options granted | R$ 849932 | R$ 849932 |
Maturity date | Apr-21 | May-20 |
Balance at the beginning of the period | R$ 466514 | |
Granted in the period | 849,932 | |
Exercised in the period | (115,949) | |
Forfeited in the period | (97,228) | (383,418) |
Falling due in the period | ||
Balance at the end of the period | R$ 253337 | R$ 466514 |
Excercise Price R$8.10 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2014-2016 Plan – 3rd Grant | 2014-2016 Plan – 3rd Grant |
Share options granted | R$ 3922204 | R$ 3922204 |
Maturity date | Nov-22 | Nov-22 |
Balance at the beginning of the period | R$ 895522 | R$ 2684284 |
Granted in the period | ||
Exercised in the period | (476,182) | (510,884) |
Forfeited in the period | (1,277,878) | |
Falling due in the period | ||
Balance at the end of the period | R$ 419340 | R$ 895522 |
Excercise Price R$8.45 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2014-2016 Plan – 2nd Grant | 2014-2016 Plan – 2nd Grant |
Share options granted | R$ 3355229 | R$ 3355229 |
Maturity date | Oct-21 | Oct-21 |
Balance at the beginning of the period | R$ 292523 | R$ 1240740 |
Granted in the period | ||
Exercised in the period | (159,675) | (656,268) |
Forfeited in the period | (291,949) | |
Falling due in the period | ||
Balance at the end of the period | R$ 132848 | R$ 292523 |
Excercise Price R$13.42 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2014-2016 Plan – 1st Grant | 2014-2016 Plan – 1st Grant |
Share options granted | R$ 1687686 | R$ 1687686 |
Maturity date | Sep-20 | Sep-20 |
Balance at the beginning of the period | R$ 531972 | R$ 658720 |
Granted in the period | ||
Exercised in the period | (32,511) | (27,424) |
Forfeited in the period | (121,175) | (99,324) |
Falling due in the period | ||
Balance at the end of the period | R$ 378286 | R$ 531972 |
Excercise Price R$8.13 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2011-2013 Plan – 3rd Grant | 2011-2013 Plan – 3rd Grant |
Share options granted | R$ 3072418 | R$ 3072418 |
Maturity date | Jul-19 | Jul-19 |
Balance at the beginning of the period | R$ 543583 | R$ 694936 |
Granted in the period | ||
Exercised in the period | ||
Forfeited in the period | (151,353) | |
Falling due in the period | (543,583) | |
Balance at the end of the period | R$ 543583 | |
Excercise Price R$8.96 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2011-2013 Plan – 2nd Grant | 2014-2016 Plan – 2nd Grant |
Share options granted | R$ 2661752 | R$ 2661752 |
Maturity date | Sep-18 | Spe-18 |
Balance at the beginning of the period | R$ 194756 | |
Granted in the period | ||
Exercised in the period | ||
Forfeited in the period | ||
Falling due in the period | (194,756) | |
Balance at the end of the period | ||
Excercise Price R$8.84 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2011-2013 Plan – 1st Grant | 2014-2016 Plan – 1st Grant |
Share options granted | R$ 2833595 | R$ 2833595 |
Maturity date | Aug-17 | Aug-17 |
Balance at the beginning of the period | ||
Granted in the period | ||
Exercised in the period | ||
Forfeited in the period | ||
Falling due in the period | ||
Balance at the end of the period |
25. Long-term incentive plan _2
25. Long-term incentive plan (Details 1) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Excercise Price R$8.84 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2011-2013 Plan – 1st Grant | 2014-2016 Plan – 1st Grant |
Volatility | 51.73% | |
Expected useful life of the option | 6 years | |
Annual interest rate without risk | 11.94% | |
Excercise Price R$8.96 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2011-2013 Plan – 2nd Grant | 2014-2016 Plan – 2nd Grant |
Volatility | 50.46% | |
Expected useful life of the option | 6 years | |
Annual interest rate without risk | 8.89% | |
Excercise Price R$8.13 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2011-2013 Plan – 3rd Grant | 2011-2013 Plan – 3rd Grant |
Volatility | 48.45% | |
Expected useful life of the option | 6 years | |
Annual interest rate without risk | 10.66% | |
Excercise Price R$13.42 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2014-2016 Plan – 1st Grant | 2014-2016 Plan – 1st Grant |
Volatility | 44.60% | |
Expected useful life of the option | 6 years | |
Annual interest rate without risk | 10.66% | |
Excercise Price R$8.45 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2014-2016 Plan – 2nd Grant | 2014-2016 Plan – 2nd Grant |
Volatility | 35.50% | |
Expected useful life of the option | 6 years | |
Annual interest rate without risk | 16.10% | |
Excercise Price R$8.10 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2014-2016 Plan – 3rd Grant | 2014-2016 Plan – 3rd Grant |
Volatility | 36.70% | |
Expected useful life of the option | 6 years | |
Annual interest rate without risk | 11.73% | |
Excercise Price R$14.41[Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2018-2020 Plan – 1st Grant | |
Expected useful life of the option | 3 years | |
Excercise Price R$11.28 [Member] | ||
LongtermIncentivePlanLineItems [Line Items] | ||
Date of grant | 2018-2020 Plan - 2ª Grant | |
Expected useful life of the option | 3 years |
25. Long-term incentive plan _3
25. Long-term incentive plan (Details Narrative) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Long-Term Incentive Plan [Abstract] | ||
Expenses related to long term benefit plan | R$ 2359 | R$ 4291 |
26. Net revenue (Details)
26. Net revenue (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue [abstract] | |||
Net operational revenue | R$ 17377194 | R$ 16981329 | R$ 16233959 |
Gross operating revenue | 25,182,831 | 24,232,404 | 22,611,074 |
Service revenue | 23,820,343 | 23,065,648 | 21,433,515 |
Service revenue - Mobile | 22,145,033 | 21,531,779 | 20,147,585 |
Service revenue - Landline | 1,675,310 | 1,533,869 | 1,285,930 |
Goods sold | 1,362,488 | 1,166,756 | 1,177,559 |
Deductions from gross revenue | (7,805,637) | (7,251,075) | (6,377,115) |
Taxes | (4,939,980) | (5,163,797) | (5,027,406) |
Discounts given | (2,843,670) | (2,073,892) | (1,329,600) |
Returns and other | R$ 21987 | R$ 13386 | R$ 20109 |
27. Operating costs and expen_3
27. Operating costs and expenses (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | R$ 7433731 | R$ 7701418 | R$ 8002077 |
Selling expenses | (4,986,289) | (4,970,780) | (4,575,177) |
General and administrative expenses | (1,717,859) | (1,608,319) | (1,424,643) |
Total | (5,428,606) | (6,862,388) | (6,298,530) |
Personnel [Member] | |||
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | (53,392) | (36,514) | (48,802) |
Selling expenses | (624,353) | (637,177) | (602,578) |
General and administrative expenses | (392,984) | (357,878) | (305,036) |
Total | (1,070,729) | (1,031,569) | (956,416) |
Third-Party Services [Member] | |||
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | (569,242) | (518,762) | (544,036) |
Selling expenses | (2,041,646) | (2,169,624) | (2,049,994) |
General and administrative expenses | (512,643) | (451,990) | (429,597) |
Total | (3,123,531) | (3,140,376) | (3,023,627) |
Interconnection And Means Of Connection [Member] | |||
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | (1,419,464) | (2,513,176) | (2,632,593) |
Selling expenses | |||
General and administrative expenses | |||
Total | (1,419,464) | (2,513,176) | (2,632,593) |
Depreciation And Amortization [Member] | |||
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | (4,132,223) | (3,119,954) | (3,280,524) |
Selling expenses | (256,898) | (162,804) | (162,020) |
General and administrative expenses | (739,860) | (671,562) | (571,126) |
Total | (5,128,981) | (3,954,320) | (4,013,670) |
Taxes, Fees And Contributions [Member] | |||
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | (32,120) | (31,754) | (36,625) |
Selling expenses | (817,369) | (866,197) | (919,018) |
General and administrative expenses | (18,846) | (18,333) | (11,963) |
Total | (868,335) | (916,284) | (967,606) |
Rent And Insurance [Member] | |||
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | (291,302) | (591,226) | (609,595) |
Selling expenses | (121,795) | (146,877) | (92,363) |
General and administrative expenses | (20,590) | (67,387) | (62,954) |
Total | (433,687) | (805,490) | (764,912) |
Cost Of Goods Sold [Member] | |||
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | (931,818) | (883,912) | (846,839) |
Selling expenses | |||
General and administrative expenses | |||
Total | (931,818) | (883,912) | (846,839) |
Publicity And Advertising [Member] | |||
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | |||
Selling expenses | (355,234) | (421,588) | (410,982) |
General and administrative expenses | |||
Total | (355,234) | (421,588) | (410,982) |
Losses On Doubtful Accounts [Member] | |||
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | |||
Selling expenses | (748,291) | (544,881) | (316,387) |
General and administrative expenses | |||
Total | (748,291) | (544,881) | (316,387) |
Others [Member] | |||
Operating costs and expenses [line items] | |||
Cost of services provided and goods sold | (4,170) | (6,120) | (3,063) |
Selling expenses | (20,703) | (21,632) | (21,835) |
General and administrative expenses | (32,936) | (41,169) | (43,967) |
Total | R$ 57809 | R$ 68921 | R$ 68865 |
28. Other income (expenses), _3
28. Other income (expenses), net (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Income | ||||
Subsidy income, net | R$ 21572 | R$ 25305 | R$ 28722 | |
Fines on telecommunications services | 50,499 | 44,411 | 41,699 | |
Revenue from disposal of assets | 2,214 | 1,708 | 2,865 | |
Other income | [1] | 1,878,558 | 282,041 | 171,273 |
Operating income | 1,952,843 | 353,465 | 244,559 | |
Expenses | ||||
FUST/FUNTTEL | [2] | (137,169) | (143,167) | (140,878) |
Taxes, fees and contributions | (4,024) | (4,092) | (4,466) | |
Provision for legal and administrative proceedings, net of reversal | (466,460) | (452,463) | (366,476) | |
Expenses from disposal of assets | (7,055) | (4,424) | (6,618) | |
Other expenses | (62,593) | (32,608) | (24,831) | |
Operating expense | (677,301) | (636,754) | (543,269) | |
Other revenues (expenses), net | R$ 1275541 | R$ 283289 | R$ 298710 | |
[1] | The variation in the period refers to: (i) credits from legal proceedings held by TIM Celular S.A. (incorporated by TIM S.A.) with a final decision in favor of the Company in higher courts in 2019, which discussed the exclusion of ICMS from the calculation base of PIS and COFINS contributions. The amount of R$ 1,795 million was recorded under other revenues in June 2019 (Note 9) and (ii) amortization of deferred revenue from the sale of the towers (Note 15). | |||
[2] | Expenses incurred with contributions on several telecommunications revenue amounts due to ANATEL, according to the legislation in force. |
28. Other income (expenses), _4
28. Other income (expenses), net (Details Narrative) R$ in Thousands | 1 Months Ended |
Jun. 30, 2019BRL (R$) | |
Other Income (Expenses), Net [Abstract] | |
Other revenue | R$ 1795 |
29. Financial income (Details)
29. Financial income (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Financial income | ||||
Interest on financial investments | R$ 88224 | R$ 119548 | R$ 369517 | |
Interest received from clients | 37,233 | 36,793 | 38,227 | |
Swap interest | 15,536 | 17,001 | 32,300 | |
Interest on leasing | 20,528 | 25,664 | 22,709 | |
Monetary adjustments | [1] | 1,263,793 | 207,191 | 39,694 |
Foreign exchange variation | 4,857 | 6,536 | 10,118 | |
Financial income, net | R$ 1430171 | R$ 412733 | R$ 512565 | |
[1] | Includes the amount of R$1,228 million regarding the adjustment of credits from a legal proceeding of TIM Celular S.A. (absorbed by TIM S.A.) on the exclusion of ICMS from PIS and COFINS tax bases (Note 9). |
29. Financial income (Details N
29. Financial income (Details Narrative) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Financial Income [Abstract] | |||
Provision amounts | R$ 840637 | R$ 849408 | R$ 528320 |
30. Financial expenses (Details
30. Financial expenses (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Financial expenses | ||||
Interest on borrowing and financing | R$ 116735 | R$ 96682 | R$ 211108 | |
Interest on taxes and fees | (28,396) | (15,409) | (5,712) | |
Swap interest | (24,604) | (32,424) | (85,362) | |
Interest on leasing | (821,463) | (266,328) | (257,305) | |
Monetary adjustment | [1] | (191,309) | (340,175) | (278,272) |
Discounted granted | (36,047) | (38,858) | (52,683) | |
Other expenses | [2] | (189,499) | (161,563) | (119,211) |
Financial expenses, net | R$ 1408053 | R$ 951439 | R$ 1009653 | |
[1] | Monetary adjustment relates mainly to provision for legal and administrative proceedings. | |||
[2] | Includes PIS/COFINS amounts on financial events, mainly related to Interest on Shareholders Equity (JSCP). |
31. Foreign exchange variatio_3
31. Foreign exchange variations, net (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Foreign exchange variations net [line items] | |||
Revenues | R$ 88192 | R$ 97530 | R$ 430018 |
Expenses | (89,100) | (96,157) | (430,766) |
Exchange variations, net | (908) | 1,373 | (748) |
Borrowing And Financing [Member] | |||
Foreign exchange variations net [line items] | |||
Revenues | 22,494 | 1,409 | 287,777 |
Expenses | (40,715) | (75,298) | (271,286) |
Suppliers [Member] | |||
Foreign exchange variations net [line items] | |||
Revenues | 9,004 | 6,844 | 4,124 |
Expenses | (13,201) | (11,925) | (6,819) |
Swaps [Member] | |||
Foreign exchange variations net [line items] | |||
Revenues | 40,742 | 75,340 | 130,971 |
Expenses | (22,493) | (1,409) | (147,356) |
Others [Member] | |||
Foreign exchange variations net [line items] | |||
Revenues | 15,952 | 13,937 | 7,146 |
Expenses | R$ 12691 | R$ 7525 | R$ 5305 |
32. Income tax and social con_3
32. Income tax and social contribution (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Current income tax and social contribution | ||||
Income tax for the year | R$ 155521 | R$ 253120 | R$ 203932 | |
Social contribution for the year | (58,905) | (92,502) | (77,148) | |
Tax incentive - SUDENE/SUDAM | [1] | 156,594 | 146,454 | 112,493 |
Current income tax | (57,832) | (199,168) | (168,587) | |
Deferred income tax and social contribution | ||||
Deferred income tax | (625,516) | 651,632 | (23,976) | |
Deferred social contribution | (225,186) | 217,501 | (8,631) | |
Deferred income tax | (850,702) | 869,133 | (32,607) | |
Provision for income tax and social contribution contingencies | (5,406) | (5,054) | 185 | |
Deferred income tax, net of tax | (856,108) | 864,079 | (32,422) | |
Income and social contribution taxes | R$ 913940 | R$ 664911 | R$ 201009 | |
[1] | As mentioned in Note 24 c.3, for investment subsidies not to be considered within the taxable income, they must be recorded as tax incentive reserves, to be used only to offset losses or increase capital. The Company has tax benefits (SUDENE/SUDAM) which comply with these rules. |
32. Income tax and social con_4
32. Income tax and social contribution (Details 1) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Income Tax And Social Contribution [Abstract] | ||||
Income before income tax and social contribution | R$ 4536067 | R$ 1880190 | R$ 1435516 | |
Combined tax rate | 34.00% | 34.00% | 34.00% | |
Combined tax rate on income tax and social contribution | R$ 1542262 | R$ 639265 | R$ 488075 | |
(Additions)/exclusions: | ||||
Unrecognized tax losses and temporary differences | (18,783) | 920,745 | 68,716 | |
Permanent additions and exclusions | ||||
Non-deductible expenses for tax purposes | (10,958) | (12,040) | (6,638) | |
Tax benefit related to interest on shareholders' equity | 338,449 | 288,998 | 64,597 | |
Tax incentive | [1] | 194,161 | 146,454 | 112,498 |
Use of previously unrecognized tax losses | 11,176 | |||
Other amounts | 125,453 | (39,981) | 36,717 | |
Income before income tax | 628,322 | 1,304,176 | 287,066 | |
Income tax and social contribution recorded in income for the period | R$ 913940 | R$ 664911 | R$ 201009 | |
Actual rate | 20.15% | (35.36%) | 14.00% | |
[1] | As mentioned in Note 24 c.3, for investment subsidies not to be considered within the taxable income, they must be recorded as tax incentive reserves, to be used only to offset losses or increase capital. The Company has tax benefits (SUDENE/SUDAM) which comply with these rules. |
33. Earnings per share (Details
33. Earnings per share (Details) - BRL (R$) R$ / shares in Units, R$ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Basic | |||
Income attributable to shareholders of the Company | R$ 3622127 | R$ 2545101 | R$ 1234507 |
Weighted average number of common shares issued (thousands) | 2,420,481 | 2,420,172 | 2,420,016 |
Basic earnings per share (expressed in R$) (in R$ per share) | R$ 1.50 | R$ 1.05 | R$ 0.51 |
Diluted | |||
Income attributable to shareholders of the Company | R$ 3622127 | R$ 2545101 | R$ 1234507 |
Weighted average number of common shares issued (thousands) | 2,421,018 | 2,421,075 | 2,241,072 |
Diluted earnings per share (expressed in R$) (in R$ per share) | R$ 1.50 | R$ 1.05 | R$ 0.51 |
33. Earnings per share (Detai_2
33. Earnings per share (Details Narrative) - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Earnings per share [line items] | |||
Diluted weighted average number of shares | 2,421,018 | 2,421,075 | 2,241,072 |
Plan 2011-2013 and Plan 2014-2016 [Member] | |||
Earnings per share [line items] | |||
Diluted weighted average number of shares | 537 | 903 |
34. Balances and transactions_3
34. Balances and transactions with related parties (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Disclosure of transactions between related parties [line items] | ||||
Total assets | R$ 10420 | R$ 94366 | ||
Total liabilities | 111,823 | 179,084 | ||
Total revenue | 8,198 | 7,571 | R$ 6638 | |
Total costs/expenses | 421,219 | 422,325 | 216,396 | |
Telecom Italia S.p.A. [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Total liabilities | [1] | 80,825 | 89,433 | |
Total revenue | [1] | 775 | 858 | 665 |
Total costs/expenses | [1] | 93,188 | 62,976 | 8,440 |
Telecom Italia Sparkle [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Total assets | [2] | 1,949 | 2,877 | |
Total liabilities | [2] | 6,531 | 11,895 | |
Total revenue | [2] | 5,371 | 5,809 | 5,281 |
Total costs/expenses | [2] | 24,914 | 30,123 | 26,775 |
TI Sparkle [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Total assets | [3] | 2,007 | 804 | |
Total liabilities | [3] | 3,731 | 4,174 | |
Total revenue | [3] | 2,052 | 904 | 692 |
Total costs/expenses | [3] | 18,700 | 18,035 | 30,734 |
TIM Brasil [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Total assets | [4] | 5,429 | 13,993 | |
Total liabilities | [4] | 6,056 | 6,044 | |
Vivendi Group [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Total liabilities | [5] | 1,164 | 4,745 | |
Total costs/expenses | [5] | 1,386 | 9,439 | 16,361 |
Gruppo Havas [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Total assets | [6] | 75,600 | ||
Total liabilities | [6] | 11,049 | 62,686 | |
Total costs/expenses | [6] | 264,318 | 301,752 | 127,730 |
Other [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Total assets | 1,035 | 1,092 | ||
Total liabilities | 2,467 | 107 | ||
Total costs/expenses | 18,713 | 3,102 | ||
Generali [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Total costs/expenses | [7] | R$ 3254 | ||
[1] | These amounts refer to international roaming, technical post-sales assistance and VAS. | |||
[2] | Ultimate parent company. These amounts refer to roaming, VAS, assignment of means and international voice data - wholesale, according to the contractual conditions between the parties. | |||
[3] | The amounts refer to the leasing of links and EILD, lease of means (submarine cables) and signaling services according to the contractual conditions between the parties. | |||
[4] | Direct controller of the Company. Amounts refer mainly to judicial deposits made due to labor claims. | |||
[5] | Shareholder of TIM S.p.A. The figures refer to value added services - VAS. | |||
[6] | The amounts described above, in the income, refer to advertising services, of which R$ 172,956 (R$ 232,492 in 2018) are related to media transfers | |||
[7] | The amounts refer to insurance coverage taken out for operating risks, civil liability and health insurance, among others. |
34. Balances and transactions_4
34. Balances and transactions with related parties (Details Narrative) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of transactions between related parties [abstract] | ||
Social benefits | R$ 4207 | R$ 4637 |
Advertising services | R$ 172956 | R$ 232492 |
35. Management remuneration (De
35. Management remuneration (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Management Remuneration [Abstract] | ||
Short-term benefits | R$ 22524 | R$ 23556 |
Long-term benefits | 900 | 3,351 |
Share-based payments remuneration | 5,379 | 10,230 |
Total compensation | R$ 28803 | R$ 37137 |
36. Financial instruments and_3
36. Financial instruments and risk management (Details) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Financial Instruments And Risk Management [Abstract] | ||
Transactions involving derivatives, assets | R$ 46511 | R$ 81408 |
Current portion, assets | 16,602 | 50,769 |
Non-current portion, assets | 29,909 | 30,639 |
Transactions involving derivatives, liabilities | (4,405) | (11,618) |
Current portion, liabilities | (858) | (2,373) |
Non-current portion, liabilities | (3,547) | (9,245) |
Transactions involving derivatives, net | 42,106 | 69,790 |
Current portion, net | 15,744 | 48,396 |
Non-current portion, net | R$ 26362 | R$ 21394 |
36. Financial instruments and_4
36. Financial instruments and risk management (Details 1) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Financial instruments and risk management [line items] | ||
Assets | R$ 29909 | R$ 30639 |
Liabilities | (3,547) | R$ 9245 |
2021 [Member] | ||
Financial instruments and risk management [line items] | ||
Assets | 8,096 | |
Liabilities | (709) | |
2022 [Member] | ||
Financial instruments and risk management [line items] | ||
Assets | 8,096 | |
Liabilities | (709) | |
2023 Onwards [Member] | ||
Financial instruments and risk management [line items] | ||
Assets | 13,717 | |
Liabilities | R$ 2129 |
36. Financial instruments and_5
36. Financial instruments and risk management (Details 2) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure of fair value measurement of assets [line items] | ||
Total assets | R$ 704839 | R$ 871478 |
Financial assets valued at fair value | 704,839 | 871,478 |
Derivatives used for hedging purposes, assets | 46,511 | 81,408 |
Securities | 654,479 | 784,841 |
Total liabilities | 4,405 | 11,618 |
Financial liabilities valued at fair value through profit or loss | 4,405 | 11,618 |
Derivatives used for hedging purposes, liabilities | 4,405 | 11,618 |
Level 1 [Member] | ||
Disclosure of fair value measurement of assets [line items] | ||
Total assets | 658,328 | 790,070 |
Financial assets valued at fair value | 658,328 | 790,070 |
Securities | 658,328 | 790,070 |
Level 2 [Member] | ||
Disclosure of fair value measurement of assets [line items] | ||
Total assets | 46,511 | 81,408 |
Financial assets valued at fair value | 46,511 | 81,408 |
Derivatives used for hedging purposes, assets | 46,511 | 81,408 |
Total liabilities | 4,405 | 11,618 |
Financial liabilities valued at fair value through profit or loss | 4,405 | 11,618 |
Derivatives used for hedging purposes, liabilities | R$ 4405 | R$ 11618 |
36. Financial instruments and_6
36. Financial instruments and risk management (Details 3) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Financial instruments and risk management [line items] | ||||
Assets, per balance sheet | R$ 7473872 | R$ 6510898 | ||
Derivative financial instruments | 46,511 | 81,408 | ||
Trade accounts receivable and other accounts receivable, excluding prepayments | 3,287,855 | 2,969,116 | ||
Marketable securities | 658,328 | 790,070 | ||
Cash and cash equivalents | 2,284,810 | 1,075,530 | R$ 2960718 | R$ 5128186 |
Leasing - assets | 156,378 | 208,049 | ||
Judicial deposits | 1,006,899 | 1,345,113 | ||
Other assets to offset | 33,090 | 41,612 | ||
Liabilities per balance sheet | 14,315,235 | 8,308,188 | ||
Borrowing and financing | 2,029,088 | 1,663,017 | ||
Derivative financial instruments | 4,405 | 11,618 | ||
Suppliers and other obligations, excluding legal obligations | 3,923,035 | 4,323,374 | ||
Leasing - liabilities | 1,584,802 | 1,940,074 | ||
Dividends payable | 577,837 | 370,105 | ||
Financial Liabilities Measured At Amortized Cost [Member] | ||||
Financial instruments and risk management [line items] | ||||
Liabilities per balance sheet | 14,310,830 | 8,296,570 | ||
Borrowing and financing | 2,029,088 | 1,663,017 | ||
Suppliers and other obligations, excluding legal obligations | 3,923,035 | 4,323,374 | ||
Leasing - liabilities | 7,780,870 | 1,940,074 | ||
Dividends payable | 577,837 | 370,105 | ||
Financial Liabilities At Fair Value Through Profit Or Loss [Member] | ||||
Financial instruments and risk management [line items] | ||||
Liabilities per balance sheet | 4,405 | 11,618 | ||
Derivative financial instruments | 4,405 | 11,618 | ||
Financial Assets Measured At Amortized Cost [Member] | ||||
Financial instruments and risk management [line items] | ||||
Assets, per balance sheet | 6,769,032 | 5,639,420 | ||
Trade accounts receivable and other accounts receivable, excluding prepayments | 3,287,855 | 2,969,116 | ||
Cash and cash equivalents | 2,284,810 | 1,075,530 | ||
Leasing - assets | 156,378 | 208,049 | ||
Judicial deposits | 1,006,899 | 1,345,113 | ||
Other assets to offset | 33,090 | 41,612 | ||
Financial Assets At Fair Value Through Profit Or Loss [Member] | ||||
Financial instruments and risk management [line items] | ||||
Assets, per balance sheet | 704,839 | 871,478 | ||
Derivative financial instruments | 46,511 | 81,408 | ||
Marketable securities | R$ 658328 | R$ 790070 |
36. Financial instruments and_7
36. Financial instruments and risk management (Details 4) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Derivative Financial Instruments One [Member] | ||
Financial instruments and risk management [line items] | ||
Currency | USD | USD |
SWAP Type | LIBOR X DI | LIBOR X DI |
COUNTERPARTY DEBT | KFW/Finnvera | KFW/ Finnvera |
COUNTERPARTY SWAP | JP Morgan e BOFA | JP Morgan and BOFA |
Total debt | R$ 330217 | R$ 378595 |
Total Swap (Asset Side) | R$ 330217 | R$ 393387 |
% Coverage | 100.00% | 100.00% |
AVERAGE SWAP RATE (Asset Side) | LIBOR 6M + 0.75% p.a. | 100% LIBOR 6M + 0.75% p.a. |
AVERAGE SWAP RATE (Liability Side) | 85.50% do CDI | 85.50% of CDI |
Derivative Financial Instruments Two [Member] | ||
Financial instruments and risk management [line items] | ||
Currency | USD | |
SWAP Type | PRE X DI | |
COUNTERPARTY DEBT | CISCO | |
COUNTERPARTY SWAP | Santander and JP Morgan | |
Total debt | R$ 116466 | |
Total Swap (Asset Side) | R$ 116466 | |
% Coverage | 100.00% | |
AVERAGE SWAP RATE (Asset Side) | 2.18% p.a. | |
AVERAGE SWAP RATE (Liability Side) | 88.20% of CDI | |
Derivative Financial Instruments [Member] | ||
Financial instruments and risk management [line items] | ||
Currency | USD | USD |
SWAP Type | PRE X DI | LIBOR X DI |
COUNTERPARTY DEBT | CISCO | KfW |
COUNTERPARTY SWAP | Santander e JP Morgan | JP Morgan |
Total debt | R$ 40366 | R$ 43420 |
Total Swap (Asset Side) | R$ 40366 | R$ 43420 |
% Coverage | 100.00% | 100.00% |
AVERAGE SWAP RATE (Asset Side) | 2.50% p.a. | LIBOR 6M + 1.35% p.a. |
AVERAGE SWAP RATE (Liability Side) | 84.50% do CDI | 102.50% of CDI |
36. Financial instruments and_8
36. Financial instruments and risk management (Details 5) R$ in Thousands | Dec. 31, 2019BRL (R$) |
Financial instruments and risk management [line items] | |
Debt in USD (Cisco and KFW) | R$ 1110000 |
Fair value of the asset side of the swap | 381,178 |
Fair value of the liability side of the swap | (338,971) |
Swap result | 42,207 |
Probable Scenario [Member] | |
Financial instruments and risk management [line items] | |
Debt in USD (Cisco and KFW) | 381,178 |
Fair value of the asset side of the swap | 381,178 |
Fair value of the liability side of the swap | (338,971) |
Swap result | 42,207 |
Possible Scenario [Member] | |
Financial instruments and risk management [line items] | |
Debt in USD (Cisco and KFW) | 474,450 |
Aggregate debt variation | 93,272 |
Fair value of the asset side of the swap | 474,450 |
Fair value of the liability side of the swap | (337,647) |
Swap result | 136,803 |
Aggregate swap variation | 94,596 |
Final result | (1,324) |
Remote Scenario [Member] | |
Financial instruments and risk management [line items] | |
Debt in USD (Cisco and KFW) | 567,104 |
Aggregate debt variation | 185,926 |
Fair value of the asset side of the swap | 567,104 |
Fair value of the liability side of the swap | (336,387) |
Swap result | 230,717 |
Aggregate swap variation | 188,510 |
Final result | R$ 2584 |
36. Financial instruments and_9
36. Financial instruments and risk management (Details 6) - Risk Variable [Member] | 12 Months Ended |
Dec. 31, 2019 | |
Probable Scenario [Member] | CDI [Member] | |
Financial instruments and risk management [line items] | |
Interest rate variable risk | 4.40% |
Probable Scenario [Member] | LIBOR [Member] | |
Financial instruments and risk management [line items] | |
Interest rate variable risk | 1.91% |
Probable Scenario [Member] | USD [Member] | |
Financial instruments and risk management [line items] | |
Interest rate variable risk | 4.0307% |
Possible Scenario [Member] | CDI [Member] | |
Financial instruments and risk management [line items] | |
Interest rate variable risk | 5.50% |
Possible Scenario [Member] | LIBOR [Member] | |
Financial instruments and risk management [line items] | |
Interest rate variable risk | 2.39% |
Possible Scenario [Member] | USD [Member] | |
Financial instruments and risk management [line items] | |
Interest rate variable risk | 5.0384% |
Remote Scenario [Member] | CDI [Member] | |
Financial instruments and risk management [line items] | |
Interest rate variable risk | 6.60% |
Remote Scenario [Member] | LIBOR [Member] | |
Financial instruments and risk management [line items] | |
Interest rate variable risk | 2.87% |
Remote Scenario [Member] | USD [Member] | |
Financial instruments and risk management [line items] | |
Interest rate variable risk | 6.0461% |
36. Financial instruments an_10
36. Financial instruments and risk management (Details 7) R$ in Thousands | 12 Months Ended |
Dec. 31, 2019BRL (R$) | |
Financial Instruments And Risk Management [Abstract] | |
Net result from USD vs. CDI transactions | R$ 5077 |
36. Financial instruments an_11
36. Financial instruments and risk management (Details 8) - BRL (R$) R$ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Disclosure of risk management strategy related to hedge accounting [line items] | |||||
Total borrowing and derivatives (Notes 19 and 36) | R$ 1593227 | R$ 1593227 | |||
Finance lease liabilities | 1,584,802 | 1,940,074 | |||
Lease - Assets (Note 15) | 208,049 | (208,049) | |||
Less: Cash and cash equivalents (Note 4) | (2,284,810) | (1,075,530) | R$ 2960718 | R$ 5128186 | |
FIC (Note 5) | (784,841) | (784,841) | |||
Net Debt | 1,464,881 | 1,464,881 | |||
EBITDA (1) (last 12 months) - Standardized | [1] | R$ 6371844 | R$ 6371844 | ||
Financial Leverage Index - Unaudited | 23.00% | 23.00% | |||
Reconciliation to Net Income for the year: | |||||
Adjusted Net Income | R$ 3622127 | R$ 2545101 | 1,234,507 | ||
Depreciation and amortization | (3,954,321) | 3,954,321 | |||
Net financial income | 21,210 | (537,333) | (497,836) | ||
Income and social contribution taxes | (913,940) | 664,911 | R$ 201009 | ||
EBITDA | [1] | 6,371,844 | 6,371,844 | ||
Balance With IFRS 16 [Member] | |||||
Disclosure of risk management strategy related to hedge accounting [line items] | |||||
Total borrowing and derivatives (Notes 19 and 36) | 1,986,982 | ||||
Finance lease liabilities | 7,780,870 | ||||
Lease - Assets (Note 15) | 156,379 | ||||
Less: Cash and cash equivalents (Note 4) | 2,284,810 | ||||
FIC (Note 5) | (654,479) | ||||
Net Debt | 6,672,184 | ||||
EBITDA (1) (last 12 months) - Standardized | [1] | R$ 9643838 | |||
Financial Leverage Index - Unaudited | 0.69% | ||||
Reconciliation to Net Income for the year: | |||||
Adjusted Net Income | R$ 3622127 | ||||
Depreciation and amortization | 5,128,981 | ||||
Net financial income | (21,210) | ||||
Income and social contribution taxes | 913,940 | ||||
EBITDA | [1] | 9,643,838 | |||
Balance without IFRS 16 [Member] | |||||
Disclosure of risk management strategy related to hedge accounting [line items] | |||||
Finance lease liabilities | (6,196,068) | ||||
Less: Cash and cash equivalents (Note 4) | (2,284,810) | R$ 1075530 | |||
Net Debt | (6,196,068) | ||||
EBITDA (1) (last 12 months) - Standardized | [1] | R$ 1315685 | |||
Financial Leverage Index - Unaudited | 4.71% | ||||
Reconciliation to Net Income for the year: | |||||
Adjusted Net Income | R$ 3765203 | ||||
Depreciation and amortization | [2] | (4,188,837) | |||
Net financial income | 613,533 | ||||
Income and social contribution taxes | [3] | (987,646) | |||
EBITDA | [1] | (1,315,685) | |||
Adjustments [Member] | |||||
Disclosure of risk management strategy related to hedge accounting [line items] | |||||
Total borrowing and derivatives (Notes 19 and 36) | 1,986,982 | ||||
Finance lease liabilities | 1,584,802 | ||||
Lease - Assets (Note 15) | (156,379) | ||||
Less: Cash and cash equivalents (Note 4) | (2,284,810) | ||||
FIC (Note 5) | (654,479) | ||||
Net Debt | 476,116 | ||||
EBITDA (1) (last 12 months) - Standardized | [1] | R$ 8328153 | |||
Financial Leverage Index - Unaudited | 0.06% | ||||
Reconciliation to Net Income for the year: | |||||
Adjusted Net Income | R$ 3765203 | ||||
Depreciation and amortization | 4,188,837 | ||||
Net financial income | (613,533) | ||||
Income and social contribution taxes | 987,646 | ||||
EBITDA | [1] | R$ 8328153 | |||
[1] | EBITDA: Earnings before interest, tax, depreciation and amortization (not an accounting metric) | ||||
[2] | Recognition of the depreciation of the assets mentioned above; | ||||
[3] | Tax impact on the adjustments from the new standard. |
36. Financial instruments an_12
36. Financial instruments and risk management (Details 9) R$ in Thousands | 12 Months Ended |
Dec. 31, 2019BRL (R$) | |
Financial instruments and risk management [line items] | |
Beginning balance | R$ 11618 |
Ending Balance | 4,405 |
Borrowings And Financing [Member] | |
Financial instruments and risk management [line items] | |
Beginning balance | 1,663,017 |
Inflows | 1,000,000 |
Financial interests | 167,998 |
Foreign exchange variations, net | 18,222 |
Payments | (820,149) |
Ending Balance | 2,029,088 |
Financial Leasing [Member] | |
Financial instruments and risk management [line items] | |
Beginning balance | 1,940,074 |
Adoption of IFRS 16 | 5,256,114 |
Inflows | 1,834,914 |
Financial interests | 821,463 |
Payments | (1,585,712) |
Remeasurement IAS 17 (i) / IFRS16 | (485,983) |
Ending Balance | 7,780,870 |
Derivative Financial Instruments (Assets) Liabilities [Member] | |
Financial instruments and risk management [line items] | |
Beginning balance | (69,790) |
Financial interests | 9,068 |
Foreign exchange variations, net | (14,145) |
Payments | 32,761 |
Ending Balance | R$ 42106 |
36. Financial instruments an_13
36. Financial instruments and risk management (Details Narrative) R$ in Thousands | Aug. 31, 2018BRL (R$)Number | Feb. 28, 2019BRL (R$) | Nov. 30, 2018BRL (R$)Number | Jun. 30, 2019BRL (R$)Number | Dec. 31, 2019BRL (R$) | Dec. 31, 2018 |
Financial instruments and risk management [line items] | ||||||
Nominal amount | R$ 1500000 | |||||
Strike price (in R$ per share) | Number | 4 | |||||
Derivate amount purchased on spot price | R$ 1000000 | R$ 1000000 | R$ 5600000 | R$ 11700000 | ||
Spot price (in R$ per share) | Number | 4.157 | 3.7655 | ||||
USD | ||||||
Financial instruments and risk management [line items] | ||||||
Derivate purchase amount | R$ 11100000 | |||||
Accounts Receivable [Member] | One Customer Concentration Risk [Member] | ||||||
Financial instruments and risk management [line items] | ||||||
Concentration risk, percentage | 10.50% | |||||
Top Of Range [Member] | Accounts Receivable [Member] | ||||||
Financial instruments and risk management [line items] | ||||||
Concentration risk, percentage | 10.00% | 10.00% |
37. Defined benefit pension p_3
37. Defined benefit pension plans and other post-employment benefits (Details) - BRL (R$) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of defined benefit plans [line items] | ||
Defined benefit pension plans and other post-employment benefits | R$ 2359 | R$ 4291 |
PAMEC/ Asset Policy and Medical Plan [Member] | ||
Disclosure of defined benefit plans [line items] | ||
Defined benefit pension plans and other post-employment benefits | R$ 5782 | R$ 2850 |
37. Defined benefit pension p_4
37. Defined benefit pension plans and other post-employment benefits (Details 1) - BRL (R$) R$ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of assets and liabilities | |||
Present value of acturial liabilities | R$ 65449 | R$ 52206 | |
Fair value of plan assets | (66,925) | (68,768) | |
Present value of obligation in excess of fair value of assets | (1,476) | (16,562) | |
Net acturial liabilities / (assets) | (1,476) | R$ 16562 | |
PBS [Member] | |||
Reconciliation of assets and liabilities | |||
Present value of acturial liabilities | [1] | 40,427 | |
Fair value of plan assets | [1] | (43,991) | |
Present value of obligation in excess of fair value of assets | [1] | (3,564) | |
Net acturial liabilities / (assets) | [1] | (3,564) | |
PBS Assisted [Member] | |||
Reconciliation of assets and liabilities | |||
Present value of acturial liabilities | [1] | 10,107 | |
Fair value of plan assets | [1] | (13,527) | |
Present value of obligation in excess of fair value of assets | [1] | (3,420) | |
Net acturial liabilities / (assets) | [1] | (3,420) | |
Management Agreement [Member] | |||
Reconciliation of assets and liabilities | |||
Present value of acturial liabilities | [1] | 151 | |
Fair value of plan assets | [1] | (425) | |
Present value of obligation in excess of fair value of assets | [1] | (274) | |
Net acturial liabilities / (assets) | [1] | (274) | |
PAMEC/Asset Policy [Member] | |||
Reconciliation of assets and liabilities | |||
Present value of acturial liabilities | 1,080 | ||
Present value of obligation in excess of fair value of assets | 1,080 | ||
Net acturial liabilities / (assets) | 1,080 | ||
AES Telecom [Member] | |||
Reconciliation of assets and liabilities | |||
Present value of acturial liabilities | 11,099 | ||
Fair value of plan assets | (8,982) | ||
Present value of obligation in excess of fair value of assets | 2,117 | ||
Net acturial liabilities / (assets) | 2,117 | ||
Medical Plan [Member] | |||
Reconciliation of assets and liabilities | |||
Present value of acturial liabilities | 2,585 | ||
Present value of obligation in excess of fair value of assets | 2,585 | ||
Net acturial liabilities / (assets) | R$ 2585 | ||
[1] | No assets were recognized by the sponsors, due to the impossibility of reimbursement of this surplus, and the sponsor's contributions will not be reduced in the future. |
37. Defined benefit pension p_5
37. Defined benefit pension plans and other post-employment benefits (Details 2) R$ in Thousands | 12 Months Ended | |
Dec. 31, 2019BRL (R$) | ||
Disclosure of defined benefit plans [line items] | ||
Net actuarial liabilities (assets) as of end | R$ 1476 | |
PBS [Member] | ||
Disclosure of defined benefit plans [line items] | ||
Actuarial Liabilities (Assets) at beginning | (14,964) | |
Expenditure (revenue) recognized in income | (1,394) | |
Recognized acturial (gains) or losses | 12,794 | |
Net actuarial liabilities (assets) as of end | (3,564) | [1] |
PBS Assisted [Member] | ||
Disclosure of defined benefit plans [line items] | ||
Actuarial Liabilities (Assets) at beginning | (4,209) | |
Expenditure (revenue) recognized in income | (391) | |
Recognized acturial (gains) or losses | 1,180 | |
Net actuarial liabilities (assets) as of end | (3,420) | [1] |
Management Agreement [Member] | ||
Disclosure of defined benefit plans [line items] | ||
Actuarial Liabilities (Assets) at beginning | (239) | |
Expenditure (revenue) recognized in income | (22) | |
Recognized acturial (gains) or losses | (13) | |
Net actuarial liabilities (assets) as of end | (274) | [1] |
PAMEC/Asset Policy [Member] | ||
Disclosure of defined benefit plans [line items] | ||
Actuarial Liabilities (Assets) at beginning | 884 | |
Expenditure (revenue) recognized in income | 81 | |
Sponsor contributions | (47) | |
Recognized acturial (gains) or losses | 162 | |
Net actuarial liabilities (assets) as of end | 1,080 | |
AES Telecom [Member] | ||
Disclosure of defined benefit plans [line items] | ||
Actuarial Liabilities (Assets) at beginning | 102 | |
Expenditure (revenue) recognized in income | 100 | |
Recognized acturial (gains) or losses | 1,915 | |
Net actuarial liabilities (assets) as of end | 2,117 | |
Medical Plan [Member] | ||
Disclosure of defined benefit plans [line items] | ||
Actuarial Liabilities (Assets) at beginning | 1,864 | |
Expenditure (revenue) recognized in income | 283 | |
Sponsor contributions | (26) | |
Recognized acturial (gains) or losses | 464 | |
Net actuarial liabilities (assets) as of end | R$ 2585 | |
[1] | No assets were recognized by the sponsors, due to the impossibility of reimbursement of this surplus, and the sponsor's contributions will not be reduced in the future. |
37. Defined benefit pension p_6
37. Defined benefit pension plans and other post-employment benefits (Details 3) R$ in Thousands | 12 Months Ended |
Dec. 31, 2019BRL (R$) | |
PBS [Member] | |
Disclosure of defined benefit plans [line items] | |
Value of liabilities at beginning | R$ 32767 |
Cost of current service | 5 |
Interest on actuarial liability | 2,932 |
Benefits paid in the year | (2,629) |
Contributions paid by participants | |
(Gains)/losses on liabilities | 7,352 |
Value of liabilities at end | 40,427 |
PBS Assisted [Member] | |
Disclosure of defined benefit plans [line items] | |
Value of liabilities at beginning | 8,285 |
Interest on actuarial liability | 738 |
Benefits paid in the year | (719) |
Contributions paid by participants | |
(Gains)/losses on liabilities | 1,803 |
Value of liabilities at end | 10,107 |
Management Agreement [Member] | |
Disclosure of defined benefit plans [line items] | |
Value of liabilities at beginning | 156 |
Interest on actuarial liability | 14 |
Benefits paid in the year | (9) |
Contributions paid by participants | |
(Gains)/losses on liabilities | (10) |
Value of liabilities at end | 151 |
PAMEC/Asset Policy [Member] | |
Disclosure of defined benefit plans [line items] | |
Value of liabilities at beginning | 884 |
Interest on actuarial liability | 81 |
Benefits paid in the year | (47) |
Contributions paid by participants | |
(Gains)/losses on liabilities | 162 |
Value of liabilities at end | 1,080 |
AES Telecom [Member] | |
Disclosure of defined benefit plans [line items] | |
Value of liabilities at beginning | 8,250 |
Cost of current service | 93 |
Interest on actuarial liability | 770 |
Benefits paid in the year | (348) |
Contributions paid by participants | 57 |
(Gains)/losses on liabilities | 2,277 |
Value of liabilities at end | 11,099 |
Medical Plan [Member] | |
Disclosure of defined benefit plans [line items] | |
Value of liabilities at beginning | 1,864 |
Cost of current service | 108 |
Interest on actuarial liability | 175 |
Benefits paid in the year | (27) |
Contributions paid by participants | |
(Gains)/losses on liabilities | 465 |
Value of liabilities at end | R$ 2585 |
37. Defined benefit pension p_7
37. Defined benefit pension plans and other post-employment benefits (Details 4) R$ in Thousands | 12 Months Ended |
Dec. 31, 2019BRL (R$) | |
PBS [Member] | |
Disclosure of defined benefit plans [line items] | |
Fair value of assets at beginning | R$ 47731 |
Benefits paid in the year | (2,629) |
Effective return on assets in the year | 4,326 |
Actuarial gain (loss) on plan assets | (5,437) |
Fair value of assets at end | 43,991 |
PBS Assisted [Member] | |
Disclosure of defined benefit plans [line items] | |
Fair value of assets at beginning | 12,494 |
Benefits paid in the year | (719) |
Effective return on assets in the year | 1,128 |
Actuarial gain (loss) on plan assets | 624 |
Fair value of assets at end | 13,527 |
Management Agreement [Member] | |
Disclosure of defined benefit plans [line items] | |
Fair value of assets at beginning | 395 |
Benefits paid in the year | (9) |
Effective return on assets in the year | 36 |
Actuarial gain (loss) on plan assets | 3 |
Fair value of assets at end | 425 |
PAMEC/Asset Policy [Member] | |
Disclosure of defined benefit plans [line items] | |
Fair value of assets at beginning | |
Contributions paid by participants | |
Fair value of assets at end | |
AES Telecom [Member] | |
Disclosure of defined benefit plans [line items] | |
Fair value of assets at beginning | 8,148 |
Benefits paid in the year | (348) |
Effective return on assets in the year | 763 |
Actuarial gain (loss) on plan assets | 361 |
Contributions paid by participants | 58 |
Fair value of assets at end | 8,982 |
Medical Plan [Member] | |
Disclosure of defined benefit plans [line items] | |
Fair value of assets at beginning | |
Sponsor contributions poured into the plan | |
Fair value of assets at end |
37. Defined benefit pension p_8
37. Defined benefit pension plans and other post-employment benefits (Details 5) R$ in Thousands | 12 Months Ended |
Dec. 31, 2019BRL (R$) | |
PBS [Member] | |
Disclosure of defined benefit plans [line items] | |
Current service cost (with interest) | R$ 5 |
Interest on actuarial liabilities | (1,394) |
Expected return on assets | 4,326 |
PBS Assisted [Member] | |
Disclosure of defined benefit plans [line items] | |
Interest on actuarial liabilities | (391) |
Expected return on assets | 1,128 |
Management Agreement [Member] | |
Disclosure of defined benefit plans [line items] | |
Interest on actuarial liabilities | (22) |
Expected return on assets | 36 |
PAMEC/Asset Policy [Member] | |
Disclosure of defined benefit plans [line items] | |
Interest on actuarial liabilities | 81 |
AES Telecom [Member] | |
Disclosure of defined benefit plans [line items] | |
Current service cost (with interest) | 93 |
Interest on actuarial liabilities | 100 |
Expected return on assets | 763 |
Medical Plan [Member] | |
Disclosure of defined benefit plans [line items] | |
Current service cost (with interest) | 108 |
Interest on actuarial liabilities | 283 |
Expenditure Planned For 2020 [Member] | PBS [Member] | |
Disclosure of defined benefit plans [line items] | |
Current service cost (with interest) | 15 |
Interest on actuarial liabilities | 2,650 |
Expected return on assets | (2,893) |
Interest on the effect of the (asset)/ liability limit | 243 |
Total net expense (income) to be recognized | 15 |
Expenditure Planned For 2020 [Member] | PBS Assisted [Member] | |
Disclosure of defined benefit plans [line items] | |
Current service cost (with interest) | |
Interest on actuarial liabilities | 658 |
Expected return on assets | (888) |
Interest on the effect of the (asset)/ liability limit | 230 |
Total net expense (income) to be recognized | |
Expenditure Planned For 2020 [Member] | Management Agreement [Member] | |
Disclosure of defined benefit plans [line items] | |
Current service cost (with interest) | |
Interest on actuarial liabilities | 10 |
Expected return on assets | (29) |
Interest on the effect of the (asset)/ liability limit | 19 |
Total net expense (income) to be recognized | |
Expenditure Planned For 2020 [Member] | PAMEC/Asset Policy [Member] | |
Disclosure of defined benefit plans [line items] | |
Current service cost (with interest) | |
Interest on actuarial liabilities | 72 |
Expected return on assets | |
Interest on the effect of the (asset)/ liability limit | |
Total net expense (income) to be recognized | 72 |
Expenditure Planned For 2020 [Member] | AES Telecom [Member] | |
Disclosure of defined benefit plans [line items] | |
Current service cost (with interest) | 125 |
Interest on actuarial liabilities | 774 |
Expected return on assets | (627) |
Interest on the effect of the (asset)/ liability limit | |
Total net expense (income) to be recognized | 272 |
Expenditure Planned For 2020 [Member] | Medical Plan [Member] | |
Disclosure of defined benefit plans [line items] | |
Current service cost (with interest) | 150 |
Interest on actuarial liabilities | 179 |
Expected return on assets | |
Total net expense (income) to be recognized | R$ 329 |
37. Defined benefit pension p_9
37. Defined benefit pension plans and other post-employment benefits (Details 6) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of defined benefit plans [abstract] | |
Nominal discount rate of the actuarial liability: | PBS South: 6.81% / 3.20%; PBS Northeast: 6.83% / 3.22%; MA: 6.85% / 3.24%; PBS-A: 6.75% / 3.14%; AES: 7.09% / 3.47%; PAMEC: 6.77% / 3.16%; FIBER: 6.96% / 3.34% |
Nominal wage growth rate: | PBS e MA: Not Applicable MA and PBS-A: Not Applicable; AES: 5.57%/ 2.00%; PAMEC and FIBER: Not Applicable |
Biometric general mortality table: | PBS, MA and PBS-A: AT-2000 segregated by sex, softened by 10%; |
Biometric disability entry table: | PBS: Álvaro Vindas; MA, PBS-A and PAMEC: Not Applicable; AES and FIBER: Mercer Disability; |
Expected rate of turnover: | PBS, MA, PBS-A and PAMEC: Nula AES and FIBER: 0.15/(time of service + 1), being null and void as from 50 years |
Probability of entry into retirement: | PBS and FIBER: 100% in 1st eligibility; MA: Not Applicable; AES: 3% per year between the first age of eligibility for early retirement and eligibility for normal retirement; MA, PBS-A and PAMEC: Not Applicable |
Estimated long-term inflation rate | PAMEC and FIBER: 7.64% / 3.25% |
Calculation method | Projected Unit Credit Method |
38. Insurance (Details)
38. Insurance (Details) R$ in Thousands | 12 Months Ended |
Dec. 31, 2019BRL (R$) | |
Vehicles (Executive and Operational Fleets) [Member] | |
Insurance [line items] | |
Description of insured assets | R$1,000 for civil liability optional (property damages and personal injury) and R$100 for moral damages |
General Liability - RCG [Member] | |
Insurance [line items] | |
Amount of insured assets | R$ 80000 |
Operating Risks [Member] | |
Insurance [line items] | |
Amount of insured assets | 32,274,029 |
Cybernetic Risks (Cyber) [Member] | |
Insurance [line items] | |
Amount of insured assets | R$ 28520 |
39. Subsequent events (Details
39. Subsequent events (Details Narrative) - Events After Reporting Period [Member] R$ in Thousands, $ in Thousands | Apr. 07, 2020USD ($) | Jan. 31, 2020BRL (R$) |
Financing [Member] | ||
Disclosure of non-adjusting events after reporting period [line items] | ||
Net agreement amount | R$ | R$ 752479 | |
Description of agreement | (i) R$325,071 at IPCA cost + 1.4386% and subject to a 15% default bond; and, (ii) R$427,408 at IPCA cost + 1.7582% and subject to a 15% default bond. | |
Description of payment terms | Total payment term of 8 years, being 3 grace years and 5 years of amortization. | |
Description of guarantee | A bank guarantee proportional to 100% of the amount of each disbursement; and (ii) a bond of receivables proportional to 5% of the amount of each disbursement. | |
Credit Agreement [Member] | ||
Disclosure of non-adjusting events after reporting period [line items] | ||
Percentage of interest payable | 15500.00% | |
Net agreement amount | $ | $ 574 | |
Description of payment terms | Term of 1 year |