Fuji Xerox NZ ‘accounting irregularities’ blow out to $NZ472m

The leader of New Zealand First, Winston Peters, has accused the Government of turning a blind eye to allegations of accounting fraud at Fuji Xerox NZ. 

His call follows the Japanese parent company, Fujifilm Holdings, telling the Tokyo Stock Exchange that a loss of 22 billion yen ($NZ284m) revealed in April as a result of improper accounting has blown out to 37.5 billion yen ($NZ472m) and that inappropriate accounting practices have also been uncovered at the Australian subsidiary. 

Fujifilm told the Tokyo Stock Exchange on 12 June that it had received a report from an independent investigation committee set up to investigate Fiji Xerox NZ saying “It has been revealed in the investigation by the independent investigation committee that, in addition to Fuji Xerox New Zealand Limited (FXNZ) … Fuji Xerox Australia Pty Limited, an Australian sales subsidiary of Fuji Xerox, also conducted inappropriate accounting similar to that conducted by FXNZ. 

“As a result, the accumulated impact of the inappropriate accounting regarding our consolidated subsidiaries on the ‘net income’ on a consolidated basis of the company for the past few years has become a loss of 37.5 billion yen from a loss of approximately 22 billion yen, which was announced in the ‘Notice of Creation of Independent Investigation Committee and Postponement of Announcement of Financial Results for Fiscal Year Ended March 31, 2017’ on April 20, 2017. Further, the accumulated impact on the "net income attributable to Fujifilm Holdings" is a loss of 28.1 billion yen.” 

The company promised to provide more detailed information later in the day, saying: “The company expresses its deepest regrets to its shareholders, investors and other related parties for any inconvenience and concerns caused.” 

When the $NZ284m loss was revealed in April Peters called for the Serious Fraud Office to take a second look at the government’s dealings with Fuji Xerox NZ following creation of the independent committee to investigate the New Zealand subsidiary after an in-house inquiry reportedly “uncovered the possibility that the unit overstated net profits by a total of roughly 22 billion yen ($NZ284m) over the past several years.” 

Commenting on the latest developments, Peters said: “There has to be something rotten in New Zealand when Fuji Xerox NZ’s ‘accounting irregularities’ of $472 million could be one of the largest corporate frauds in New Zealand history but the government, the establishment and law enforcement deliberately bury their heads in the sand.” 

He said the higher “jaw dropping” figure of  $NZ472million “will be big news internationally and drags our country’s name through the mud.” 

He continued: “NZ First asked questions about Fuji Xerox last October. We backed that up with written questions and an oral question that only got repeated National denials about Fuji Xerox’s sharp business practices.” 

Peters revealed that he had been approached by “a major Japanese business journalist,” to be told that “they were planning to run a story on Fuji Xerox New Zealand's fraud on 15 May.” (Peter’s did not identify the news outlet). 

He added: “Fuji Xerox NZ is not just a company that is mired in ‘accounting irregularities’ but does not pay a cent in taxation. Yet Fuji Xerox got a clean bill of health from ministers Steven Joyce and Simon Bridges, the Serious Fraud Office and the Auditor-General. Fuji Xerox NZ got taxpayer contracts by the buckets-load and officialdoms cover-up after cover–up.”