Impairment assessment of goodwill related to 山木工業 and uncertainty in the port business plan
First written in FY2023. 1 of 4 entries say "Materialised", first in FY2024. Latest entry: FY2026.
The whole theme swung hardest in 2024: 39 of 92 companies on the "Worse" side.
59 other companies' latest entry also says "Restated".
- FY2026RestatedAnnual report
「We determined that there were no indications of impairment for the goodwill related to 山木工業株式会社, based on an examination of the operating profit recorded by the company after goodwill amortisation during the current consolidated fiscal year and its projected operating profit for the following consolidated fiscal year based on its business plan.」
Regarding the impairment indicators identified in FY2024, the company again determined in FY2026, following FY2025, that there were no impairment indicators based on operating profit and projected profit for the following fiscal year. The goodwill balance was ¥707 million. - FY2025MitigatedAnnual report
「We determined that there were no indications of impairment for the goodwill related to 山木工業株式会社, based on an examination of the operating profit recorded by the company after goodwill amortisation during the current consolidated fiscal year and its projected operating profit for the following consolidated fiscal year based on its business plan.」
Regarding the impairment indicators identified in FY2024, the company determined in FY2025 that there were no impairment indicators based on operating profit after goodwill amortisation and projected profit for the following fiscal year. The goodwill balance was ¥849 million. - FY2024MaterialisedAnnual report
「During the current consolidated fiscal year, the port business was in a lull between large port construction projects that had also been anticipated in the business plan at the time of the acquisition of 山木工業株式会社. As a result, operating profit or loss in the port business, after deducting goodwill amortisation, was negative in both the previous and current consolidated fiscal years. Accordingly, we determined that there were indications of impairment and assessed whether an impairment loss needed to be recognised during the current consolidated fiscal year.」
Although no impairment indicators had been identified in the previous fiscal year, in FY2024 the port business recorded operating losses for 2 consecutive periods because it was between large port construction projects, and impairment indicators were in fact identified. However, no impairment loss was recognised because undiscounted future cash flows exceeded the carrying amount. - FY2023First statedAnnual report
「Goodwill: ¥1,132 million. As no significant deterioration was identified in the business environment or other assumptions underlying the business plan at the time of the acquisition of 山木工業株式会社 during the current consolidated fiscal year, we determined that there were no indications of impairment for the goodwill related to the company. The key assumptions in the business plan, including the timing and scale of orders in the port business, involve a high degree of uncertainty, and management's judgements on these matters could have a significant impact on determining whether indications of impairment exist.」
While stating that there were no indications of impairment for the ¥1,132 million of goodwill related to 山木工業, the company disclosed the uncertainty surrounding assumptions about the timing and scale of orders in the port business as a risk.