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21. LEASING TRANSACTIONS (Tables)
 12 Months Ended
Dec. 31, 2019
Leasing Transactions  
Schedule of right to use

The breakdown of the balance for each type of asset identified is as follows:

 

               
    Dec. 31, 2019        Jan 1, 2019   
Real estate property    206          238   
Vehicles    71       104  
    277       342  
               
Schedule of changes in the asset right to use

Changes in the right-of-use assets are as follows: 

                       
    Real estate
property 		       Vehicles        Total  
January 1, 2019    238       104       342  
Addition    28       4       32  
Disposals (contracts terminated)   (13 )     -       (13 )
Amortization (1)    (37 )     (39 )     (76 )
Remeasurement (2)    (10 )     2       (8 )
Balances at December 31, 2019    206       71       277  
                       

(1)      Amortization of the right-of-use assets is recognized in the Income Statement is net of use of the credits of PIS, Pasep and Cofins taxes on leasing payments ofR$5.
(2)      The Company has identified events giving rise to modifications of their principal contracts. When occurred, the lease liabilities adjustments are recognized in counterpart of the right-of-use assets.
Schedule of changes in the liabilities for leasing transactions

The changes in the lease liabilities are as follows: 

       
    2019    
January 1, 2019 (1)    342  
Addition    32  
Disposals (contracts terminated)   (13 )
Accrued interest (2)    36  
Payment of principal portion of lease liability   (96 )
Payment of interest   (5 )
Remeasurement (3)    (8 )
Balances at December 31, 2019    288  
Current liabilities    85  
Non-current liabilities    203  

 

(1)      The Company’s incremental borrowing rate applied to the lease liability recognized in the statement of financial position on the date of the initial application varied between 7.96% p.a. and 10.64% p.a., depending on the leasing contract period, and 13.17% p.a., respectively, for contracts with maturities of up to two years, two to five years and longer than five years. The rates applied to the contracts entered into during 2019 were 6.87% p.a., 7.33% p.a. and 8.08% p.a., for contracts with maturities, respectively, of up to three years, three to four years, and over four years. To determine the incremental borrowing rate, the Company used as a reference quotations obtained from financial institutions, these being a function of the Company’s credit risk, and market conditions on the date of contracting.
(2)      Financial expenses recognized in the income statement are net of PIS/Pasep and Cofins taxes credits on lease payments in the amounts of R$2.
(3)      The Company identified events that give rise to modifications of their principal contracts. When occurred, the lease liabilities adjustments are recognized in counterpart of the right-of-use assets.
Schedule of potential right to recovery

The potential right to recovery of PIS/Pasep and Cofins taxes embedded in the leasing consideration, according to the periods specified for payment, is as follows:

 

       
Cash flow  Nominal   Adjusted to present value 
Consideration for the leasing  704    288 
Potential PIS/Pasep and Cofins (9.25%)  56    18 
Schedule of maturity of its contracts

The cash flows of the contracts containing a lease are, in their majority, indexed to the IPCA inflation index on an annual basis. Below is an analysis of maturity of lease contracts:

       
2020    86    
2021    58  
2022    26  
2023    26  
2024    26  
2025 at 2045    482  
Undiscounted values    704  
Embedded interest    (416 )
Lease liabilities    288