U.S. News

Sony Will Delay Annual Earnings Report

Reuters
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Sony said on Wednesday it would delay its annual earnings report by a few weeks as it grapples with the extra paperwork needed to comply with tougher U.S. accounting rules.

This is the first business year that foreign companies will have to comply with the U.S. Sarbanes-Oxley Act of 2002, which calls for a number of changes in corporate governance and the way financial results are reported.

The Tokyo-based electronics and entertainment conglomerate said it would report its results for the year ending in March on May 16, instead of around the end of April.

"We have a lot more paperwork to do in order to deal with the rules," said Sony spokeswoman Mami Imada. She said Sony might take the same amount of time again next year due to the amount of paperwork involved.

Sony's American Depositary Receipts are traded on the New York Stock Exchange. Hitachi, listed on the New York Stock Exchange, and NEC, listed on the Nasdaq, have also said they will postpone their results reports to some time in May.

NEC, dogged by accounting troubles, is also having to recalculate earnings results for the past business year, after an independent auditor asked it to document fair pricing of the company's maintenance services.

The Sarbanes-Oxley act was passed by U.S. Congress to combat corporate fraud in the wake of accounting scandals at Enron and WorldCom.

Some aspects of the law, most notably a section requiring company managers to regularly disclose how they keep their books in order, have attracted criticism from groups like the U.S. Chamber of Commerce, which say complying with it is too burdensome.