Post-M&A Contingent Liabilities, Unrealized Synergies and Impairment
First written in FY2016. 1 of 3 entries say "Worsened", first in FY2020. Latest entry: FY2022.
The whole theme swung hardest in 2024: 36 of 89 companies on the "Worse" side.
- FY2022RestatedAnnual report
「If contingent liabilities, unrecognized liabilities or other items that could not be detected during the due diligence process emerge, they may adversely affect the Group's performance and financial condition.」
The company continues to face the risks of contingent liabilities and unrecognized liabilities after M&A, declining earning power, unrealized synergies and impairment. - FY2020WorsenedAnnual report
「If contingent liabilities, unrecognized liabilities or other items that could not be detected during the due diligence process emerge, they may adversely affect the Group's performance and financial condition. In addition, if the target company's earning power declines due to changes in the business environment after the M&A, or if the expected synergies are not realized, the Group may need to recognize an impairment loss, making it impossible to recover the investment and potentially adversely affecting the Group's performance and financial condition.」
In addition to the existing risks of declining earning power, unrealized synergies and impairment, the disclosure explicitly stated that contingent liabilities and unrecognized liabilities not detected during due diligence could emerge. - FY2016First statedAnnual report
「If the target company's earning power declines due to changes in the business environment after the M&A, or if the expected synergies are not realized, the Group may need to recognize an impairment loss, making it impossible to recover the investment and potentially adversely affecting the Group's performance and financial condition.」
The disclosure described a decline in earning power after M&A, unrealized synergies, impairment and the inability to recover the investment.