Risk of revenue fluctuations due to changes in estimates under the percentage-of-completion method
First written in FY2021. 4 of 5 entries say "Materialised", first in FY2022-Q1. Latest entry: FY2023-Q2.
Techno Smart Corp. moved to the "Worse" side of this theme in 2021, 4 years before the typical company in this theme (2025).
The whole theme swung hardest in 2024: 9 of 64 companies on the "Worse" side.
3 other companies' latest entry also says "Materialised".
- FY2023-Q2MaterialisedAnnual report
「Following a review of the estimate of total costs, the stage of completion declined, resulting in lower sales. Accordingly, the amount is presented with a minus sign.」
During the current quarter as well, the stage of completion and sales actually declined due to a change in the estimate of total costs related to percentage-of-completion accounting and revenue recognition over time. - FY2022MaterialisedAnnual report
「Following a review of the estimate of total costs, the stage of completion declined, resulting in lower sales. Accordingly, the amount is presented with a minus sign.」
The stage of completion and sales actually declined due to a change in the estimate of total costs related to percentage-of-completion accounting and revenue recognition over time. - FY2022-Q2MaterialisedAnnual report
「Following a review of the estimate of total costs, the stage of completion declined, resulting in lower sales. Accordingly, the amount is presented with a minus sign.」
During the current quarter as well, an actual decline in the stage of completion and a resulting decrease in sales occurred due to a change in the estimate of total costs related to the percentage-of-completion method. - FY2022-Q1MaterialisedAnnual report
「Following a review of the estimate of total costs, the stage of completion declined, resulting in lower sales. Accordingly, the amount is presented with a minus sign.」
An actual decline in the stage of completion and a resulting decrease in sales occurred due to a change in the estimate of total costs related to the percentage-of-completion method. - FY2021First statedAnnual report
「Revenue recognized under the percentage-of-completion method is calculated using the cost-to-cost method, based on reasonable estimates at the end of the fiscal year of total revenue, total costs and the stage of completion at the end of the fiscal year. However, sales may be affected, and the Company's operating results may fluctuate, if the specifications requested by the customer change substantially as a result of negotiations with the customer, causing total revenue to change, or if total costs change because unforeseen costs are incurred, among other factors.」
For sales of ¥6,674.319 million recognized under the percentage-of-completion method, changes in estimates due to specification changes, fluctuations in total revenue, unforeseen costs and other factors were identified for the first time as a standalone risk that could cause sales and operating results to fluctuate.