Risk of Unprofitable Projects Due to Development Effort Overruns and Defects in Contracted Systems Development
First written in FY2018. 4 of 8 entries say "Materialised", first in FY2020. Latest entry: FY2026.
Acmos 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.
21 other companies' latest entry also says "Restated".
- FY2026RestatedAnnual report
「Although the company carefully assesses risks when accepting system development projects and has also strengthened project management after orders are received, if labor hours exceed the assumptions made when an order was received, or if defects in deliverables require corrective work that incurs additional costs, the project may become unprofitable and affect business performance.」
The company reconfirms the risk of contracted system development becoming unprofitable due to excess labor hours and defects, and the related responses through assessment at the time of order acceptance and project management. - FY2024MitigatedAnnual report
「Decrease of ¥20 million in the provision for after-sales costs」
The provision for after-sales costs related to software development projects and other matters decreased by ¥20 million from the previous fiscal year, indicating a numerical decline in the risk of additional costs after development. - FY2023MaterialisedAnnual report
「Increase of ¥26 million in the provision for after-sales costs」
The company recognized a ¥26 million provision for future after-sales costs related to software development projects and other matters, quantifying the risk of additional costs after development. - FY2022MaterialisedAnnual report
「As there is no prospect of resolving defects in externally procured products for the forestry IoT system developed by ASロカス株式会社 using subsidies, the company recognized an expense of ¥3 million for a provision for the refund of subsidies and an impairment loss of ¥3 million on the unamortized software and hardware balances, each as an extraordinary loss.」
As defects in externally procured products for the forestry IoT system remained unresolved, the company recognized a ¥3 million expense for a provision for the refund of subsidies and a ¥3 million impairment loss. - FY2022-Q3MaterialisedAnnual report
「For an IoT system for the forestry industry developed with government subsidies, the company determined that there was no prospect of resolving defects in externally procured components. Accordingly, it recognized as extraordinary losses in the quarter ¥3 million in subsidies expected to be repaid and ¥3 million in unamortized software and hardware balances.」
Due to defects in externally procured products, the company recognized a projected refund of ¥3 million in subsidies and an unamortized software and hardware balance of ¥3 million as extraordinary losses, with the risks of defects and unprofitability emerging as actual losses. - FY2021RestatedAnnual report
「Although the company carefully assesses risks when accepting system development projects and has also strengthened project management after orders are received, if labor hours exceed the assumptions made when an order was received, or if defects in deliverables require corrective work that incurs additional costs, the project may become unprofitable and affect business performance.」
The company reconfirms the risk of contracted system development becoming unprofitable due to excess labor hours and defects, and the related responses through assessment at the time of order acceptance and project management. - FY2020MaterialisedAnnual report
「Provision for loss on orders 1,963」
The company recognized a ¥1,963 thousand provision for loss on orders for projects expected to incur future losses, quantifying the risk of unprofitable contracted development. - FY2018First statedAnnual report
「If labor hours exceed the assumptions made when an order was received, or if defects in deliverables require corrective work that incurs additional costs, the project may become unprofitable and affect business performance.」
The company discloses excess labor hours, defects in deliverables and remediation costs in contracted development as independent business risks. Its countermeasures are risk assessment when accepting orders and stronger project management after orders are received.