Unprofitability and Loss of Credibility Caused by Defects in Products and Services
First written in FY2017. 5 of 8 entries say "Materialised", first in FY2019. Latest entry: 2026-08-13.
Japan System Techniques moved to the "Worse" side of this theme in 2019.
The whole theme swung hardest in 2023: 2 of 15 companies on the "Worse" side.
0 other companies' latest entry also says "Materialised".
- FY2026WorsenedAnnual report
「The information systems we develop are becoming increasingly complex as AI technology rapidly spreads and evolves, development methods diversify to include serverless and codeless approaches, new requirements increase through startup businesses and other activities, and delivery times become shorter. The risk of rework due to insufficient or inconsistent system requirements and unprofitable projects due to inaccurate estimates is increasing.」
The company explicitly stated that the risk of unprofitable projects and defects is increasing as systems become more complex due to AI, serverless and codeless development, new requirements and shorter delivery times. - FY2023-Q2RestatedAnnual report
「There have been no material changes during the cumulative second quarter of the current fiscal year.」
The company stated that there had been no material changes in business risks from the securities report for the previous fiscal year. Its previous recognition of risks relating to unprofitable projects and defects remains in place. - FY2021MaterialisedAnnual report
「Provision for loss on construction contracts included in cost of sales: ¥12.797 million」
A provision for loss on construction contracts of ¥12.797 million was recognized in preparation for future losses related to made-to-order software. The risk of unprofitable projects has also emerged in the current year as an accounting estimate of loss. - FY2020MaterialisedAnnual report
「The risk of unprofitable projects due to rework caused by insufficient consideration of system specifications and inaccurate estimates is increasing.」
The risk of unprofitable projects continued to be disclosed, and the discussion of business performance explicitly identified the occurrence of unprofitable projects as a factor behind the decline in operating income. - FY2019MaterialisedAnnual report
「The risk of unprofitable projects due to rework caused by insufficient consideration of system specifications and inaccurate estimates is increasing.」
The risk of unprofitable projects was explicitly identified, and a provision for loss on construction contracts of ¥37.264 million was recognized for the current consolidated fiscal year. The scope of the risk disclosure expanded beyond defects in products and services to unprofitable projects arising from estimates and specifications. - FY2017First statedAnnual report
「However, these measures may not completely eliminate the possibility of defects and other issues. If such defects or other issues occur, our Group's performance could be materially affected by large unprofitable projects arising from compensation to customers and product repairs, as well as reputational damage.」
Against a backdrop of increasingly complex information systems and rising customer quality requirements, compensation and repairs in the event of defects, unprofitable projects and reputational damage were identified as risks.