Loss-Making Projects Caused by Estimation Errors, Specification Changes, and Delivery Delays
First written in FY2016. 15 of 36 entries say "Worsened", first in FY2020-Q3. Latest entry: 2026-08-05.
Cresco moved to the "Worse" side of this theme in 2022, the same year as the typical company in this theme.
The whole theme swung hardest in 2017: 9 of 31 companies on the "Worse" side.
6 other companies' latest entry also says "Worsened".
- 2026-08-05WorsenedEarnings
「Segment income (operating income) in the digital solutions business was ¥129 million (down 19.5% year on year). This was attributable to unprofitable projects arising at certain consolidated subsidiaries from the previous fiscal year, despite the increase in revenue described above.」
Unprofitable projects continued, resulting in a decline in segment income in the digital solutions business. - FY2026WorsenedAnnual report
「For the current fiscal year, a provision for loss on orders of ¥119 million was recognized.」
The provision for loss on orders increased from ¥43.057 million at the end of the previous fiscal year to ¥119.513 million, further highlighting the risks of unprofitable projects and deteriorating project profitability in accounting terms. - FY2026-H1WorsenedAnnual report
「Segment profit (operating profit) in the Financial segment was ¥849 million, down 26.3% year on year. This was mainly due to a lack of growth in orders for large-scale projects in the Banking field and the emergence of unprofitable projects at some consolidated subsidiaries in the Other field. Provision for loss on orders 43,057 57,204」
Unprofitable projects arose at some consolidated subsidiaries in the Financial segment, and the provision for loss on orders increased from ¥43.057 million at the end of the previous fiscal year to ¥57.204 million. - FY2025MitigatedAnnual report
「For the current fiscal year, a provision for loss on orders of ¥43 million was recognized. In addition, a loss on compensation for damages of ¥85 million was recognized in connection with the IT services business.」
The provision for loss on orders decreased from ¥99.562 million at the end of the previous fiscal year to ¥43.057 million, while a loss on compensation for damages of ¥85 million was also recognized, leaving unprofitable-project and contract risks in place. - FY2025-H1WorsenedAnnual report
「Provision for loss on orders 99,562 174,713」
The provision for loss on orders increased from ¥99.562 million at the end of the previous fiscal year to ¥174.713 million, further highlighting the risk of deteriorating project profitability in accounting terms. - FY2024WorsenedAnnual report
「Multiple large-scale contracted projects became unprofitable due to factors including system specifications, functional requirements and the development structure. A provision for loss on orders of ¥99.562 million was recognized.」
Multiple large-scale contracted projects became unprofitable, and the provision for loss on orders increased from ¥51.415 million at the end of the previous fiscal year to ¥99.562 million. - FY2024-Q3WorsenedAnnual report
「In the IT services business, some of the Company's multiple large-scale contracted projects became unprofitable due to factors including system specifications, functional requirements and the development structure. Provision for loss on orders 51,415 101,417」
Multiple large-scale contracted projects became unprofitable, and the provision for loss on orders increased from ¥51.415 million at the end of the previous fiscal year to ¥101.417 million. The risk of deteriorating project profitability is also expanding in monetary terms. - FY2024-Q2WorsenedAnnual report
「Provision for loss on orders 51,415 339,275」
The provision for loss on orders increased from ¥51.415 million at the end of the previous fiscal year to ¥339.275 million at the end of the second quarter. Multiple large-scale contracted projects also became unprofitable due to factors including system specifications, functional requirements and the development structure. - FY2024-Q1WorsenedAnnual report
「In the IT services business, some of the Company's multiple large-scale contracted projects became unprofitable due to factors including system specifications, functional requirements and the development structure. Provision for loss on orders 51,415 250,210」
Multiple large-scale contracted projects became unprofitable due to factors including system specifications, functional requirements and the development structure. The provision for loss on orders also increased from ¥51.415 million at the end of the previous fiscal year to ¥250.210 million. - FY2023WorsenedAnnual report
「For the current fiscal year, a provision for loss on orders of ¥51.415 million was recognized.」
The provision for loss on orders increased from ¥6.377 million at the end of the previous fiscal year to ¥51.415 million, indicating that the risk of deteriorating profitability on orders had become more pronounced in accounting terms. - FY2023-Q3MitigatedAnnual report
「Provision for loss on orders 6,377 —」
The provision for loss on orders decreased from ¥6.377 million at the end of the previous fiscal year to nil at the end of the third quarter. Although the risk of projects becoming unprofitable continues to be noted from a project management perspective, the accounting provision has decreased. - FY2023-Q2MaterialisedAnnual report
「This was due to the loss of business opportunities resulting from the completion of large projects and the occurrence of some unprofitable projects in fields including Recruitment and Temporary Staffing and Transportation.」
It states that some unprofitable projects arose in the Enterprise segment, resulting in lost sales opportunities. The provision for loss on orders was ¥6.418 million at the end of the quarter. - FY2023-Q1MaterialisedAnnual report
「This was due to the loss of business opportunities resulting from the completion of large projects and the occurrence of some unprofitable projects in fields including Recruitment and Temporary Staffing and Transportation.」
The disclosure states that some unprofitable projects arose in the Enterprise segment, resulting in lost business opportunities. The emergence of the risk of deteriorating project profitability was confirmed. - FY2022-Q3MaterialisedAnnual report
「This was due to an increase in revenue in the Machinery and Electronics field mentioned above, in addition to the elimination of the decline in productivity caused by COVID-19 in the first half of the previous year, despite a decrease in revenue in the Automotive and Transportation Equipment field and the occurrence of unprofitable projects at consolidated subsidiaries.」
The disclosure states that unprofitable projects arose at consolidated subsidiaries in the Manufacturing segment. The emergence of the risk of deteriorating project profitability was confirmed. Meanwhile, profit in the Manufacturing segment increased 26.0% year on year. - FY2022-Q2WorsenedAnnual report
「Provision for loss on orders 7,861 12,224 Segment profit (operating profit) in the Manufacturing segment was ¥728 million, up 14.5% year on year. This reflected the fact that, although certain consolidated subsidiaries had unprofitable projects in the Automotive and Transportation Equipment field,」
The provision for loss on orders increased from ¥7.861 million at the end of the previous consolidated fiscal year to ¥12.224 million, and the disclosure states that certain consolidated subsidiaries in the Manufacturing segment had unprofitable projects. - FY2022-Q1MitigatedAnnual report
「Provision for loss on orders 7,861 6,603」
The provision for loss on orders decreased from ¥7.861 million at the end of the previous consolidated fiscal year to ¥6.603 million. The possibility of unprofitable projects continues to be disclosed, but the accounting provision has decreased. - FY2021MitigatedAnnual report
「Provision for loss on orders ¥29.157 million ¥7.861 million」
While unprofitable projects continued to arise, the provision for loss on orders decreased from ¥29.157 million at the end of the previous fiscal year to ¥7.861 million. Multistage reviews, risk analysis, process visualization and initiatives to bring projects to an early resolution also continue. - FY2021-Q3MaterialisedAnnual report
「• Unprofitable projects arose.」
The occurrence of unprofitable projects continues to be explicitly stated. The provision for loss on orders decreased from ¥29.157 million at the end of March 2020 to ¥22.744 million. - FY2021-Q2WorsenedAnnual report
「• Unprofitable projects arose. Provision for loss on orders 29,157 47,278」
The disclosure states that unprofitable projects arose against a backdrop including COVID-19, and that the provision for loss on orders increased from ¥29.157 million at the end of the previous consolidated fiscal year to ¥47.278 million. - FY2021-Q1MaterialisedAnnual report
「• Unprofitable projects arose at certain consolidated subsidiaries.」
The disclosure states that unprofitable projects arose at certain consolidated subsidiaries due in part to the impact of COVID-19, confirming the emergence of the risk of deteriorating project profitability. - FY2020WorsenedAnnual report
「Provision for loss on orders 9,387 ※2 29,157」
The provision for loss on orders increased from ¥9.387 million at the end of the previous consolidated fiscal year to ¥29.157 million, indicating that the risk of deteriorating profitability has continued to materialize in the accounts. - FY2020-Q3WorsenedAnnual report
「Provision for loss on orders 9,387 142,958」
The provision for loss on orders increased from ¥9.387 million at the end of the previous consolidated fiscal year to ¥142.958 million, indicating that the risk of deteriorating profitability in projects received has materialized in the accounts at a significantly higher amount. - FY2020-Q2MaterialisedAnnual report
「Provision for loss on orders 63,125」
The provision for loss on orders increased from ¥9.387 million at the end of the previous consolidated fiscal year to ¥63.125 million, indicating that the risk of deteriorating profitability in projects received has materialized in the accounts. - FY2020-Q1RestatedAnnual report
「With respect to contract software development, we thoroughly conduct reviews and quality control at each stage, from inquiries and estimates, including order prices, delivery schedules and quality, through order acceptance, project launch and planning, development and delivery. At the same time, we are working to strengthen project management capabilities and ensure consistent project management in order to secure project profitability and prevent unprofitable projects from arising. However, as risks tend to increase as projects progress due to such factors as revisions to plans or organizational structures and changes in requirements or specifications, it is difficult to guarantee that no problems will occur. If a problem were to occur, additional costs, delays in acceptance and liability for damages could have a material impact on business results.」
Continuing to address risks related to estimates, order prices, delivery schedules, specification changes, additional costs, acceptance delays and liability for damages through reviews and quality control. - FY2019RestatedAnnual report
「However, it is difficult to completely avoid risks, including external factors. If work cannot be completed and delivered by the date agreed in advance with the customer, delay damages will arise, and if the work ultimately cannot be completed and delivered, liability for damages will arise, potentially affecting the business results and other aspects of the management of our corporate group.」
Continuing to describe project risks related to estimation errors, specification changes, additional work, delivery delays and liability for damages. - FY2019-Q3RestatedAnnual report
「However, as risks tend to increase as projects progress due to such factors as revisions to plans or organizational structures and changes in requirements or specifications, it is difficult to guarantee that no problems will occur. If a problem were to occur, additional costs, delays in acceptance and liability for damages could have a material impact on business results.」
Continuing to describe project risks, including additional costs, acceptance delays and liability for damages arising from revisions to plans or organizational structures and specification changes. - FY2019-Q2RestatedAnnual report
「However, as risks tend to increase as projects progress due to such factors as revisions to plans or organizational structures and changes in requirements or specifications, it is difficult to guarantee that no problems will occur. If a problem were to occur, additional costs, delays in acceptance and liability for damages could have a material impact on business results.」
Continuing to describe project risks, including additional costs, acceptance delays and liability for damages arising from revisions to plans or organizational structures and specification changes. - FY2018RestatedAnnual report
「However, it is difficult to completely avoid risks, including external factors. If work cannot be completed and delivered by the date agreed in advance with the customer, delay damages will arise, and if the work ultimately cannot be completed and delivered, liability for damages will arise, potentially affecting the business results and other aspects of the management of our corporate group.」
Continuing to describe project risks related to estimation errors, specification changes, additional work, delivery delays and liability for damages. - FY2018-Q3RestatedAnnual report
「However, as risks tend to increase as projects progress due to such factors as revisions to plans or organizational structures and changes in requirements or specifications, it is difficult to guarantee that no problems will occur. If a problem were to occur, additional costs, delays in acceptance and liability for damages could have a material impact on business results.」
Continuing to describe project risks, including additional costs, acceptance delays and liability for damages arising from revisions to plans or organizational structures and changes in requirements or specifications. - FY2018-Q1RestatedAnnual report
「With respect to contract software development, we thoroughly conduct reviews and quality control at each stage, from inquiries and estimates, including order prices, delivery schedules and quality, through order acceptance, project launch and planning, development and delivery. At the same time, we are working to strengthen project management capabilities and ensure consistent project management in order to prevent unprofitable projects from arising. However, risks tend to increase as projects progress, due to such factors as revisions to plans or organizational structures and changes in requirements or specifications.」
Continuing to address the risk of deteriorating project profitability due to estimates, order prices, delivery schedules and specification changes through reviews and quality control. - FY2017-Q3RestatedAnnual report
「At the time an order is received and at an early stage after work begins, we analyze risks related to various conditions, including customer requirements and technical difficulty, and conduct multistage reviews to examine the project, including whether profits can be secured as projected.」
Continuing consistent project management from order receipt through design, development and maintenance to prevent unprofitable projects from arising. - FY2017-Q2MaterialisedAnnual report
「Provision for loss on orders 86,462」
A provision for loss on orders of ¥86.462 million was recognized at the end of the current quarter, indicating that the risk of deteriorating profitability in projects received had materialized in the accounts. The balance at the end of the previous consolidated fiscal year was zero. - FY2017-Q1RestatedAnnual report
「With respect to contract software development, we thoroughly conduct reviews and quality control at each stage, from inquiries and estimates, including order prices, delivery schedules and quality, through order acceptance, project launch and planning, development and delivery. At the same time, we are working to strengthen project management capabilities and ensure consistent project management in order to prevent unprofitable projects from arising. However, risks tend to increase as projects progress, due to such factors as revisions to plans or organizational structures and changes in requirements or specifications.」
Continuing to address project risks related to estimates, specification changes, delivery schedules, quality and additional costs through reviews and quality control. - FY2016First statedAnnual report
「If actual work hours exceed estimates due to specification changes or additional work, projects could become low-margin or unprofitable.」
The risks involved in project execution, including delivery delays, delay damages and damages for failure to deliver, are described.