Fuji Xerox halts government contract bids
Japanese office technology company Fuji Xerox has agreed to temporarily stop bidding for government business while officials wait to absorb a report on an accounting scandal that cost the company more than $350 million.
The Ministry of Business, Innovation and Employment (MBIE), which oversees a large portion of government procurement, said Fuji Xerox New Zealand (FXNZ) had agreed to voluntary suspend the signing of any new government contracts.
The company will compete for non-government contracts and will still support its existing government customers.
Top executives from Fuji Xerox in Japan were in New Zealand earlier this month to stress the company’s commitment to the local market.
Last month, an independent report commissioned by Fujifilm Holdings, which owns 75 per cent of Fuji Xerox, found an accounting firm had reason to suspect fraud had occurred at FXNZ and said a former managing director was paid more than $1m to leave.
The essence of the concerns is that incentives paid by Fuji Xerox to its management and staff in New Zealand and Australia encouraged them to book sales earlier than was standard practice, artificially bumping up the subsidiaries’ income.
MBIE spokeswoman Casey Hamilton Harrison confirmed the ministry currently had no information to suggest that any government agencies had suffered any financial loss as a result of the apparent irregularities.
But Hamilton Harrison would not comment on whether the min- istry was concerned the practices might have disadvantaged Fuji Xerox’ rivals in bidding for government work.
A statement from MBIE said the suspension would give the ministry ‘‘time to understand the full implications of the report from Fujifilm Holdings’’ which has yet to be translated into English.
The suspension would be reviewed six weeks after a translation was received, it said.
Fuji Xerox is one of several companies that won the right to supply printers, photocopiers and office supplies to agencies under what are known as ‘‘all of government’’ contracts. Companies with similar contracts in the print technology space are Canon, Ricoh and Konica Minolta.
MBIE said the ministry wanted to ensure companies that supplied the Government were held to ‘‘the high standards the public would expect and that New Zealand continues to be recognised as a great country to do business’’.
Fuji Xerox said there were no issues about it meeting its contractual obligations to customers.
FXNZ was confident it would be able to satisfy MBIE that the issues were historical and resume business as usual ‘‘in the near future’’, Fuji Xerox president Hiroshi Kurihara said.