Change in the Method of Recognizing the Product Warranty Provision
First written in FY2020-Q3. 1 of 2 entries say "Achieved", first in FY2020. Latest entry: FY2020.
The whole theme swung hardest in 2019: 6 of 30 companies on the "Worse" side.
0 other companies' latest entry also says "Achieved".
- FY2020AchievedAnnual report
「Previously, costs for free repairs of products and other items were recognized as expenses when incurred. From the current consolidated fiscal year, we have changed to a method of recognizing an estimated amount calculated based on past results and other factors as a product warranty provision.」
The accounting treatment was changed from expensing when incurred to recognizing a provision for product warranties, reducing operating income, ordinary income and profit before income taxes for the fiscal year by ¥85 million, respectively. - FY2020-Q3First statedAnnual report
「Previously, costs for free repairs of products and other items were recognized as expenses when incurred. From the third-quarter consolidated accounting period under review, we changed to a method of recognizing an estimated amount calculated based on past results and other factors as a product warranty provision. This change was made because it became possible to reasonably estimate future free-repair costs, with the aim of improving the appropriateness of period income measurement and strengthening the financial position. As a result, operating income, ordinary income and quarterly net income before income taxes and other adjustments for the third-quarter year-to-date consolidated period each decreased by ¥58 million.」
For free-repair costs, the company changed from recognizing expenses when incurred to recognizing a product warranty provision based on past results. As a result, operating income, ordinary income and quarterly net income before income taxes for the third-quarter year-to-date period each decreased by ¥58 million.