business

Mitsubishi Electric overcharged on defense contracts

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Mitsubishi Electric Corp said Saturday that in its consolidated financial results for the third quarter of the current fiscal year ending March 31, 2013, it expects to record a reserve that could amount to 77.3 billion yen (65.5 billion yen of which attributable to Mitsubishi Electric Corp) as a non-operating expense, for refund of overcharged expenses, related penalties and interest on certain contracts in its electronics systems business.

The precise amount of the reserve may change depending on further investigations to be conducted in cooperation with the involved parties.

In contracts with the Ministry of Defense (MOD), the Cabinet Satellite Intelligence Center, the Japan Aerospace Exploration Agency and the National Institute of Information and Communications Technology, Mitsubishi Electric overcharged expenses by shifting work records among different orders. Similar practices have been identified in relation to separate contracts between four affiliate companies and MOD.

© BusinessWire

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