Uncertainty in estimates of revenue recognized under the percentage-of-completion method
First written in FY2021. 1 of 8 entries say "Reframed", first in FY2022-Q2. Latest entry: FY2026.
The whole theme swung hardest in 2024: 9 of 63 companies on the "Worse" side.
21 other companies' latest entry also says "Other".
- FY2026Increase in amounts recognized for revenueAnnual report
「Revenue (annual amount recognized) ¥1,630.584 million ¥2,116.143 million Contract assets ¥253.755 million ¥402.131 million」
Revenue recognized over time for system development and other services increased from ¥1,630.584 million in the previous fiscal year to ¥2,116.143 million, while contract assets increased from ¥253.755 million to ¥402.131 million. The progress ratio is calculated as the ratio of costs incurred to estimated total costs. - 2026-05-29OtherGeneral Meetings of Shareholders
「Regarding revenue recognition for system development and related services, when the performance of a contract meets certain requirements and progress can be measured reliably, revenue is recognized over a certain period in accordance with the satisfaction of the performance obligation.」
Revenue recognition over time for system development and related services continues, with progress measured based on the ratio of costs incurred to estimated total costs. The canonical thread remains unchanged. - FY2025Decrease in amounts recognized for revenueAnnual report
「Revenue (annual amount recognized) ¥1,945.685 million ¥1,630.584 million Contract assets ¥300.586 million ¥253.755 million」
Revenue recognized over time for system development and other services decreased from ¥1,945.685 million in the previous fiscal year to ¥1,630.584 million, while contract assets decreased from ¥300.586 million to ¥253.755 million. - FY2024Increase in amounts recognized for revenueAnnual report
「Amounts recognized in the consolidated financial statements for the current consolidated fiscal year Revenue (amount recognized for the year) ¥1,945,685 thousand Contract assets ¥300,586 thousand」
Revenue allocated over the service period for system development and other services increased from ¥1,634,479 thousand in the previous fiscal year to ¥1,945,685 thousand, while contract assets increased from ¥292,385 thousand to ¥300,586 thousand. - FY2022Full-year disclosure of amounts recognized for revenueAnnual report
「Revenue (amount recognized for the year) ¥441,029 thousand ¥990,333 thousand Accounts receivable ¥89,759 thousand － Contract assets － ¥143,279 thousand」
For system development and other services after the application of the revenue recognition accounting standard, the Company disclosed full-year revenue of ¥990,333 thousand and contract assets of ¥143,279 thousand. Progress is calculated as the ratio of costs incurred to estimated total costs. - FY2022-Q3RestatedAnnual report
「The progress toward satisfaction of performance obligations is estimated using the ratio of costs incurred to estimated total costs, or the input method.」
Even after the application of the revenue recognition accounting standard, progress in recognizing revenue from system development and other services continues to be estimated using the ratio of costs incurred to estimated total costs. - FY2022-Q2ReframedAnnual report
「For system development and other services in the EC Solutions Business and IT Solutions Business, the Company previously applied the percentage-of-completion method when it could reasonably measure the total costs required to meet certain requirements and complete a project, and applied the completed-contract method to system development and other projects with very short construction periods. The Company has changed to a method of recognizing revenue over a period of time as performance obligations are satisfied when it can reasonably measure the progress toward completion and certain requirements are met. The progress toward satisfaction of performance obligations is estimated using the ratio of costs incurred to estimated total costs, or the input method.」
Following the application of the revenue recognition accounting standard, revenue recognition was reorganized from the former percentage-of-completion and completed-contract methods to recognition over a period of time as performance obligations are satisfied. It is explicitly stated that progress is estimated based on the ratio of costs incurred to estimated total costs to measure progress toward completion reasonably. - FY2021First statedAnnual report
「The total project costs underlying revenue recognized under the percentage-of-completion method are estimated based on budgets prepared for each project. However, because projects involve building e-commerce sites and customizing them to meet customer needs, uncertainty is inherent in estimating the work and hours required to complete each project when preparing those budgets.」
As a significant accounting estimate, the company disclosed revenue of ¥441,029 thousand and accounts receivable of ¥89,759 thousand recognized under the percentage-of-completion method. Changes in estimated total project costs due to specification changes or other factors could materially affect recognized revenue.