Qualified Opinion in the Auditor’s Report on the Consolidated Financial Statements Included in the Securities Report for the 26th Fiscal Period (Fiscal Year Ending March 2026)
エア・ウォーター株式会社, エア・ウォーター防災株式会社, and a considerable number of consolidated subsidiaries and affiliated companies
Revenue and cost of sales at エア・ウォーター防災株式会社, and revenue at the Company and a considerable number of subsidiaries, including related cost of sales and statement of financial position items
Inappropriate accounting practices, including overstatement of inventory, deferral of asset impairment losses, overstatement and premature recognition of revenue, inflation of sales by involving unnecessary counterparties in transactions, avoidance of recognizing provisions, and capitalizing expenditures that did not meet the definition of an asset. In addition, supporting documents relating to construction completion dates and the dates on which goods were delivered had been falsified, and records necessary to clarify the circumstances surrounding the reallocation of costs such as labor and subcontracting costs had not been retained.
The adjustment to the timing of revenue recognition was negative ¥5,880 million for the previous consolidated fiscal year and ¥557 million for the current consolidated fiscal year. For エア・ウォーター防災株式会社, revenue and cost of sales were ¥25,176 million and ¥16,722 million, respectively, for the current consolidated fiscal year, and ¥23,760 million and ¥16,918 million, respectively, for the previous consolidated fiscal year.
The previous consolidated fiscal year and the current consolidated fiscal year (fiscal year ending March 2026). The previously filed consolidated financial statements have been restated, and misstatements included in the consolidated financial statements for the current consolidated fiscal year have been corrected.
Related procedures
Audit (qualified opinion)
Company response
Special Investigation Committee. The chair’s name and date of establishment are Not disclosed.
The Company takes the circumstances that led to the qualified opinion very seriously and will respond appropriately.
| Item | Details |
|---|---|
| Event name | Qualified Opinion in the Auditor’s Report on the Consolidated Financial Statements Included in the Securities Report for the 26th Fiscal Period (Fiscal Year Ending March 2026) |
| Date of occurrence | 31 July 2026 (the date the auditor’s report containing the qualified opinion was received) |
| Date recognized / date notice received | 31 July 2026 (the date the auditor’s report was received from KPMG AZSA LLC) |
| Subject Entity | エア・ウォーター株式会社, エア・ウォーター防災株式会社, and a considerable number of consolidated subsidiaries and affiliated companies |
| Target Locations / Products | Revenue and cost of sales at エア・ウォーター防災株式会社, and revenue at the Company and a considerable number of subsidiaries, including related cost of sales and statement of financial position items |
| Cause | Inappropriate accounting practices, including overstatement of inventory, deferral of asset impairment losses, overstatement and premature recognition of revenue, inflation of sales by involving unnecessary counterparties in transactions, avoidance of recognizing provisions, and capitalizing expenditures that did not meet the definition of an asset. In addition, supporting documents relating to construction completion dates and the dates on which goods were delivered had been falsified, and records necessary to clarify the circumstances surrounding the reallocation of costs such as labor and subcontracting costs had not been retained. |
| Amount of Impact on Business Performance | The adjustment to the timing of revenue recognition was negative ¥5,880 million for the previous consolidated fiscal year and ¥557 million for the current consolidated fiscal year. For エア・ウォーター防災株式会社, revenue and cost of sales were ¥25,176 million and ¥16,722 million, respectively, for the current consolidated fiscal year, and ¥23,760 million and ¥16,918 million, respectively, for the previous consolidated fiscal year. |
| Accounting period in which recognized | The previous consolidated fiscal year and the current consolidated fiscal year (fiscal year ending March 2026). The previously filed consolidated financial statements have been restated, and misstatements included in the consolidated financial statements for the current consolidated fiscal year have been corrected. |
| Type of litigation or proceeding | Audit (qualified opinion) |
| Investigation structure | Special Investigation Committee. The chair’s name and date of establishment are Not disclosed. |
| Outlook | The Company takes the circumstances that led to the qualified opinion very seriously and will respond appropriately. |
Items this document does not state (14)
These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.
The reasons the company gives
The company's own explanation, not something inferred from the numbers.An investigation by the Special Investigation Committee identified inappropriate accounting practices at the Company and multiple subsidiaries and affiliated companies, including overstatement and premature recognition of revenue, overstatement of inventory, and avoidance of recognizing asset impairment losses and provisions. In addition, because supporting documents relating to construction completion dates and other matters had been falsified, and records necessary to clarify the circumstances surrounding the reallocation of costs had not been retained, the audit firm was unable to obtain sufficient appropriate audit evidence regarding figures as of and before the end of the previous consolidated fiscal year.