Contingent asset based on Brazilian tax litigation
First written in FY2022-Q1. 1 of 3 entries say "Achieved", first in FY2022-Q3. Latest entry: FY2022-Q3.
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- FY2022-Q3AchievedAnnual report
「Ajinomoto's Brazilian subsidiary, a member of the Group, had filed lawsuits concerning the method used to calculate taxes known as PIS/COFINS. Certain receivables relating to these lawsuits had been classified as contingent assets as of the end of the second quarter of the current consolidated fiscal year, but victories in all related lawsuits had become final by the end of the third quarter of the current consolidated fiscal year. As a result, during the nine months ended the third quarter of the current consolidated fiscal year, the full amount of the receivables relating to these lawsuits was recognized as assets. Profit of ¥3,263 million was recognized under “Other operating income” and ¥1,049 million under “Other financial income.”」
Victories in all related Brazilian PIS/COFINS tax litigation became final, and the full amount of the receivables was recognized as assets. Operating income of ¥3,263 million and financial income of ¥1,049 million were recorded. - FY2022-Q2Partial victories became final and receivables were recognizedAnnual report
「As a result, as of the end of the second quarter of the current consolidated fiscal year, the amount of receivables relating to litigation in which the company had secured final victories was estimated at 120 million Brazilian reais (¥2,497 million). This amount was recognized under “Other non-current assets,” with an equal amount recognized as profit under “Other operating income” and other items. Receivables expected to arise from the remaining cases still in litigation continue to be classified as contingent assets. As of the end of the second quarter of the current consolidated fiscal year, this amount was estimated at 86 million Brazilian reais (equivalent to ¥1,792 million).」
Victories in some of the Brazilian PIS/COFINS tax cases became final, and receivables equivalent to ¥2,497 million were recognized as assets and profit. Receivables equivalent to ¥1,792 million relating to the remaining litigation continue to be disclosed as contingent assets. - FY2022-Q1First statedAnnual report
「In light of these circumstances and the opinions of external experts, we have classified the receivable expected in connection with this matter as a contingent asset. As of the end of the current first quarter of the fiscal year, we estimate the amount of the receivable at BRL 244 million (equivalent to ¥5,450 million).」
Following rulings and litigation concerning Brazil's PIS/COFINS taxes, the likelihood increased that Ajinomoto's Brazilian subsidiary could claim receivables for part of the taxes it had paid in the past. It disclosed an amount equivalent to ¥5,450 million as a contingent asset. The litigation rulings, however, were stated not to be final.