Reasons Found For Falsified Accounts

Following several months battling falsification issues in the company’s accounting, Ricoh has identified “one-off” or “exceptional items” worth Rs683 crore (US$10.02 million), in its Indian operations.
Previously, the company reported a loss of Rs1,118 crore (US$16.40 million), including some “exceptional items.” The company could not explain what they were, until now.
Following intensive investigations, Ricoh has found the main causes in the falsified accounts (which are now referred to as the “one-off/exceptional items”).
According to Ricoh, these causes include:
• fictitious sales that inflated revenues；
• potential bad debts that relate to fictitious sales;
• unsupported adjustments that have inflated profits；
• inappropriate revenue and profit recognition；
• inventory provisions;
• adjustments to balance sheet items for which inadequate accounting or controls or falsification resulted in irrecoverable balances.

The falsification was disclosed when the company failed to submit its financial results for June and September quarters to the stock exchange. As a result, Ricoh India was shifted to the so-called “Z-group” on March 28. As reported by livemint.com, Bombay Exchange Stock (BSE) stopped trading in Ricoh India shares on 26 May.
To cover the losses and create a new balance sheet for all future financial reporting, Ricoh Co., the parent company, infused Rs1,123 crore (US$16.47 million ) into the scam-hit Ricoh India operations.

More information at: www.livemint.com/

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