Recognition of extraordinary losses (loss on valuation of shares of subsidiaries and affiliates, litigation-related expenses, etc.)
TOKYO KOKI CO.LTD. (reporting company), 株式会社東京衡機エンジニアリング (subsidiary)
The substantive value of the shares held declined based on an assessment conducted in light of the subsidiary's business performance. In addition, litigation and litigation-preparation expenses were incurred in connection with inflated costs and kickbacks carried out through an outsourcing provider by a former director who had also served as president of the Company's subsidiary.
Related procedures
Damages claim against a former director; litigation preparation
TOKYO KOKI CO.LTD. (the Company)
The Company's former director (name: Not disclosed)
Non-consolidated: ¥139 million loss on valuation of shares of subsidiaries and affiliates (extraordinary loss). Consolidated: ¥31 million in litigation-related expenses (extraordinary loss). The loss on valuation of shares of subsidiaries and affiliates had no impact on consolidated results.
Results for the fiscal year ending February 2026
Company response
The Company filed a damages claim against the former director, decided to take legal measures to pursue accountability, and retained a law firm
| Item | Details |
|---|---|
| Event name | Recognition of extraordinary losses (loss on valuation of shares of subsidiaries and affiliates, litigation-related expenses, etc.) |
| Subject Entity | TOKYO KOKI CO.LTD. (reporting company), 株式会社東京衡機エンジニアリング (subsidiary) |
| Cause | The substantive value of the shares held declined based on an assessment conducted in light of the subsidiary's business performance. In addition, litigation and litigation-preparation expenses were incurred in connection with inflated costs and kickbacks carried out through an outsourcing provider by a former director who had also served as president of the Company's subsidiary. |
| Amount of Impact on Business Performance | Non-consolidated: ¥139 million loss on valuation of shares of subsidiaries and affiliates (extraordinary loss). Consolidated: ¥31 million in litigation-related expenses (extraordinary loss). The loss on valuation of shares of subsidiaries and affiliates had no impact on consolidated results. |
| Accounting period in which recognized | Results for the fiscal year ending February 2026 |
| Type of litigation or proceeding | Damages claim against a former director; litigation preparation |
| Plaintiff | TOKYO KOKI CO.LTD. (the Company) |
| Defendant | The Company's former director (name: Not disclosed) |
| Date of filing / date of action | The Company disclosed the filing of the damages claim in a disclosure dated 28 December 2023 |
| Directors' and officers' liability | The Company filed a damages claim against the former director, decided to take legal measures to pursue accountability, and retained a law firm |
Items this document does not state (15)
These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.
The reasons the company gives
The company's own explanation, not something inferred from the numbers.The substantive value of the shares declined based on an assessment conducted in light of the subsidiary's business performance. In addition, expenses were incurred in connection with a damages claim concerning inflated outsourcing costs and kickbacks involving a former director, as well as preparations for the litigation.