Individual losses or expenses don't matter much to a public company, as long as it can borrow money to keep paying its workers. This is called 'cashflow' and pretty much the only way a company goes bankrupt is if it can't borrow. No matter how much of a loss it makes, even if a company is net negative over its whole lifespan it can still be successful!

So this huge loss, despite being only on paper, undermines the confidence of Sony's creditors, and they will start raising interest and giving less favourable terms.

It's all about confidence and not the amount. Confidence in Sony is actually HIGHER than a few months ago because they changed CEO and they're believing his promises that he will turn the company around.

They only obtained the asset ( or I'll say money because that's all you seem to understand), because they lost money in the first place. The government would have lessened their losses if Sony hadn't already racked up as much tax assets as they did. 

Here it is is simply.

Sony lost a lot of money. The government was gonna give them a tax break because they lost a lot of money. Sony lessened their calculated losses on this belief. But now the government will not give Sony a tax break. Sony now has to account for their whole loss.

the assest (money) was already on thier blance sheet dude. It wasn't about to be given to them and then wasn't. Don't know where you got that from

Seems pretty bad to me.

I don't know how is it in other countries, but in Spain, when a company has profits, has to pay a corporate tax of 25-30%. If you have losses, you obtain a tax asset of a 25% of the losses, so you can compensate with future profits, but you can only use it during a number of years. If you don't have profits during several years, you lose that tax asset. I believe this is what has happened here.

If you can't use that asset, it's lost money that you have to put in the balance, as it's money that you won't recover compensating against future taxes due to profits.

Sony isn't there yet, or even that close. They still have an opportunity to restructure and shed some of the dead weight. In fact they just recently announced that they're getting rid of 10,000 workers which should help.

you got it champ

no one is arguing that this isn't lost money because it is, a loss is a loss, but it's not as bad here because the loss isn't because of their business it's because of writing off the tax assets as a loss. They already recorded the 2.96 billion in losses which is directly result of diminishing return on their business, that added to the tax asset they had to write off and you got the total 6.4 billion as seen in the other thread, it's not as bad as if the 6.4 billion was directly resulted to the company like people here would want you to believe.

guessing it's a typo, this is an American issue after all

I thought the total was something like $6 billion, the tax portion was $3.7 billion. The rest was their operating losses.

Though this is bad Sony is on a horizon right now to drastically improve their positioning and therefore profitability. They claim an expected profit next year, we'll have to see, but I predict some sort of come back in the next few years.

That is what happened actually. Tax credit is not tangible. It's not a real asset. Sony included it as an asset because they thought they'd be able to use it, but now the government told them they can't. It's like a receivable that cannot be claimed. Sony never really had it.