TOKYO, Jun 25 (Pulse News Wire) – Kaihan CO.,LTD. (3133.T) received an unqualified opinion from Progress Audit Corporation on its fiscal year 2026 financial statements and consolidated financial reports.
The audit firm cited severe liquidity issues and significant uncertainty regarding the company's going concern status due to ongoing operating losses and legal enforcement actions against the company’s debts totaling approximately ¥109 million and social insurance arrears amounting to approximately ¥29 million. As a result, the company plans to convene a special shareholders’ meeting on June 25 to address the approval of the financial statements. In detail, the audit revealed that Kaihan has reported consecutive quarterly losses since the beginning of fiscal 2025, leading to a cash crunch and raising concerns about its ability to continue operations. Additionally, the company faced asset seizures related to unpaid social insurance liabilities and outstanding debt obligations.
Despite requests from the auditor for management to assess these risks adequately, sufficient evidence supporting potential corrective measures was lacking. Looking ahead, Kaihan stated it takes the situation seriously and will work diligently to resolve the issues. A special shareholders’ meeting will be held promptly to seek shareholder approval for the financial statements. The company also noted that it would disclose any further developments concerning its financial position as soon as possible.
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