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PROVISION FOR JUDICIAL LIABILITIES (Tables)

6 Months Ended

Jun. 30, 2023

PROVISION FOR JUDICIAL LIABILITIES

Rollforward and changes in the provisions according to the nature of the proceedings for probable losses, net of judicial deposits


		June 30,
		2023
		Tax and				Civil,		Contingent
		social				environment		liabilities
		security		Labor		and real estate		assumed ⁽¹⁾ ⁽²⁾		Total
Provision balance at the beginning of the period		419,915		255,805		118,729		2,645,705		3,440,154
Payments		(1,192)		(22,839)		(868)				(24,899)
Reversal		(4,968)		(28,652)		(7,507)		(88,612)		(129,739)
Additions		29,147		62,979		11,155				103,281
Monetary adjustment		13,158		10,700		8,889				32,747
Provision balance		456,060		277,993		130,398		2,557,093		3,421,544
Judicial deposits		(145,567)		(77,101)		(23,796)				(246,464)
Provision balance at the end of the period		310,493		200,892		106,602		2,557,093		3,175,080

1)

Amounts arising from tax-related lawsuits with a possible or remote probability of loss in the amount of R$2,410,363 and civil lawsuits in the amount of R$146,730, measured and recorded at the estimated fair value resulting from the business combination with Fibria, in accordance with paragraph 23 of IFRS 3- Business Combinations.

2)	Reversal due to a change in likelihood and/or due to settlement.


		December 31,
		2022
		Tax and				Civil,		Contingent
		social				environment		liabilities
		security		Labor		and real estate		assumed ⁽¹⁾ ⁽²⁾		Total
Provision balance at the beginning of the year		477,096		178,925		82,592		2,694,541		3,433,154
Payments		(14,948)		(44,516)		(20,497)				(79,961)
Reversal		(71,446)		(53,211)		(15,577)		(48,836)		(189,070)
Additions		14,036		157,562		56,834				228,432
Monetary adjustment		15,177		17,045		15,377				47,599
Provision balance		419,915		255,805		118,729		2,645,705		3,440,154
Judicial deposits		(149,951)		(12,270)		(21,623)				(183,844)
Provision balance at the end of the year		269,964		243,535		97,106		2,645,705		3,256,310

1)

Amounts arising from tax-related lawsuits with a possible or remote probability of loss in the amount of R$2,448,564 and civil lawsuits in the amount of R$197,141, measured and recorded at the estimated fair value resulting from the business combination with Fibria, in accordance with paragraph 23 of IFRS 3 – Business Combinations.

2)Reversal due to a change in likelihood and/or due to settlement.

Schedule of possible losses for which no provision has been recorded

The Company is involved in tax, civil and labor lawsuits, whose losses have been assessed as possible by Management, supported by legal counsel, and therefore no provision was recorded:


		June 30,		December 31,
		2023		2022
Taxes and social security ⁽¹⁾		9,211,342		8,201,246
Labor		224,181		321,428
Civil and environmental ⁽¹⁾		4,981,793		4,414,877
		14,417,316		12,937,551

1)

The amounts above do not include the fair value adjustments allocated to possible loss risk contingencies representing R$2,537,335 (R$2,614,518 as of December 31, 2022), which were recorded at fair value resulting from business combinations with Fibria, in accordance with paragraph 23 of IFRS 3 – Business Combinations, as presented in Note 20.1.1. above.