NEC Corporation Unable to File Form 20-F Annual Report With U.S. SEC and Concludes Restatement of Prior U.S. GAAP Results Is Not
21 Septembre 2007 - 9:30AM
PR Newswire (US)
Financial statements filed under Japan GAAP are not affected TOKYO,
Sept. 21 /PRNewswire-FirstCall/ -- NEC Corporation announced today
that it was not able to complete a U.S. GAAP-required analysis
relating to software, maintenance and service revenues. As
previously reported, the analysis is primarily governed by a U.S.
GAAP standard called SOP 97-2 requiring vendor specific objective
evidence ("VSOE") to support recognition of revenue from certain
types of software and maintenance and support services provided as
part of multiple-element contracts. This analysis had been
necessary for NEC's outside auditor to complete the audit of NEC's
consolidated financial statements for the fiscal year ended March
31, 2006 under U.S. Public Company Accounting Oversight Board
standards. As a result, NEC will not be able to file its Form 20-F
annual report for the year ended March 31, 2006 with the U.S.
Securities and Exchange Commission ("SEC"). In addition, NEC's U.S.
GAAP consolidated financial statements previously filed with or
submitted to the SEC for all financial periods for fiscal years
ended on and after March 31, 2000 should no longer be relied upon.
Because of the complexities involved in determining the adjustments
required to restate its U.S GAAP results, NEC has concluded that a
restatement is not practicable. NEC's consolidated financial
statements under Japan GAAP are current and not affected by this
announcement. NEC remains in compliance with the disclosure rules
of the Tokyo Stock Exchange and the Securities and Exchange Law of
Japan. Starting in the interim period ended September 30, 2006, for
the purpose of disclosure in accordance with Japanese law, NEC
changed the accounting principles under which it prepares its
consolidated financial statements from U.S. GAAP to Japan GAAP. In
June 2007, NEC filed its Annual Securities Report ("Yukashoken
Hokokusho") in accordance with the Securities and Exchange Law of
Japan containing Japan GAAP consolidated financial statements for
fiscal years ended March 31, 2006 and March 31, 2007 together with
audit reports issued by the outside auditor under the audit
standards generally accepted in Japan. As previously reported, NEC
had requested and received an extension of NASDAQ's required date
for filing its Form 20-F for the fiscal year ended March 31, 2006
to September 25, 2007. NEC understands that NASDAQ may suspend the
trading of NEC's American Depositary Receipts ("ADRs") and may
remove the Company's ADRs from trading on NASDAQ. Outstanding ADRs
currently account for approximately 2.9% of NEC's total issued
shares. Should NEC's ADRs be delisted, no new ADRs can be created.
However, NEC intends to maintain its ADR facility in the United
States. ADR holders may be able to sell over-the-counter in the
United States if U.S. dealers make a market, or may have to cancel
their ADRs and withdraw the underlying ordinary shares from the
depositary to trade them in the Japanese stock market. In the event
of cancellation, NEC plans to bear the ADR cancellation fee until
December 31, 2007. CAUTIONARY STATEMENTS: This material contains
forward-looking statements pertaining to strategies, financial
targets, technology, products and services, and business
performance of NEC Corporation and its consolidated subsidiaries
(collectively "NEC"). Written forward-looking statements may appear
in other documents that NEC files with stock exchanges or
regulatory authorities, such as the U.S. Securities and Exchange
Commission, and in reports to shareholders and other
communications. The U.S. Private Securities Litigation Reform Act
of 1995 contains, and other applicable laws may contain, a
safe-harbor for forward- looking statements, on which NEC relies in
making these disclosures. Some of the forward-looking statements
can be identified by the use of forward-looking words such as
"believes," "expects," "may," "will," "should," "seeks," "intends,"
"plans," "estimates," "targets," "aims," or "anticipates," or the
negative of those words, or other comparable words or phrases. You
can also identify forward-looking statements by discussions of
strategy, beliefs, plans, targets, or intentions. Forward-looking
statements necessarily depend on currently available assumptions,
data, or methods that may be incorrect or imprecise and NEC may not
be able to realize the results expected by them. You should not
place undue reliance on forward-looking statements, which reflect
NEC's analysis and expectations only. Forward-looking statements
are not guarantees of future performance and involve inherent risks
and uncertainties. A number of important factors could cause actual
results to differ materially from those in the forward-looking
statements. Among the factors that could cause actual results to
differ materially from such statements include (i) impact of NEC's
announcement that its previously issued financial statements may
not be relied upon and inability to prepare the financial
statements for inclusion in the 2006 Form 20-F and to restate
historical financial statements, (ii) global economic conditions
and general economic conditions in NEC's markets, (iii) fluctuating
demand for, and competitive pricing pressure on, NEC's products and
services, (iv) NEC's ability to continue to win acceptance of NEC's
products and services in highly competitive markets, (v) NEC's
ability to expand into foreign markets, such as China, (vi)
regulatory change and uncertainty and potential legal liability
relating to NEC's business and operations, (vii) NEC's ability to
restructure, or otherwise adjust, its operations to reflect
changing market conditions, (viii) movement of currency exchange
rates, particularly the rate between the yen and the U.S. dollar,
and (ix) uncertainty relating to the ongoing informal inquiry by
the SEC. Any forward-looking statements speak only as of the date
on which they are made. New risks and uncertainties come up from
time to time, and it is impossible for NEC to predict these events
or how they may affect NEC. NEC does not undertake any obligation
to update or revise any of the forward-looking statements, whether
as a result of new information, future events, or otherwise. The
management targets included in this material are not projections,
and do not represent management's current estimates of future
performance. Rather, they represent targets that management will
strive to achieve through the successful implementation of NEC's
business strategies. Finally, NEC cautions you that the statements
made in this material are not an offer of securities for sale. The
securities may not be offered or sold in any jurisdiction in which
registration is required absent registration or an exemption from
registration under the applicable securities laws. For example, any
public offering of securities to be made in the United States must
be registered under the U.S. Securities Act of 1933 and made by
means of an English language prospectus that contains detailed
information about NEC and management, as well as NEC's financial
statements. DATASOURCE: NEC Corporation CONTACT: In Japan: Diane
Foley of NEC Corporation, +81-3-3798-6511; or in the U.S.: Bill
McBride of Gavin Anderson & Co., +1-212-515-1970, for NEC
Corporation Web site: http://www.nec.com/
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