What's New (Aug, 2011)

August 29,2011

The Committee on Accounting Guidelines for Small and Medium-sized Entities (established by JICPA, the Japan Federation of Certified Public Tax Accountants' Associations, the Japan Chamber of Commerce and Industry, and the Accounting Standards Board of Japan (ASBJ)) amended, and released on June 9, 2011, "The Accounting Guidelines for Small and Medium-sized Entities." This year's amendments were minor, as in the last year's amendments.

August 29,2011

JICPA published, on July 8, 2011, the revised Auditing and Assurance Practice Committee Practical Guideline No. 83 "Practical Guideline on Quarterly Review." The guideline was revised in response to the publications such as, the revised ASBJ Statement No.12 “Accounting Standard for Quarterly Financial Statements” on March 25, 2011 by ASBJ, the “Position Paper on the Revision of the Quarterly Review Standards” on June 30, 2011, by the Business Accounting Council of the Financial Services Agency, as well as other related revisions of the relevant ordinances.

The major revisions to the guideline are as follows:

 1. Simplification of the Quarterly Reviews

 2. Accounting Changes and Error Corrections

 3. Presentation of Comprehensive Income

 4. Voluntary Application of the IFRSs

 5. Response to the Clarity Projects

August 29,2011

JICPA published, on July 8, 2011, the Auditing and Assurance Practice Committee Practical Guideline No. 85 "Illustrations of Auditors' Reports. "The guideline was published in response to the publications of the "Position Paper on the Revision of the Auditing Standards" on March 26, 2010, and the “Position Paper on the Revision of Auditing Standards for Interim Audits" on June 30, 2011, by the Business Accounting Council of the Financial Services Agency.

This publication of the practical guideline is a result of careful consideration by the JICPA of illustrations of auditors' reports used in audits pursuant to the Financial Instruments and Exchange Act and Companies Act.

The guideline will be effective for the audits of both consolidated and non-consolidated financial statements and for the interim audits of both interim consolidated and non-consolidated financial statements, starting from April 1, 2011.

With the publication of this guideline, the Auditing and Assurance Practice Committee Practical Guideline No. 75 "Practical Guideline on Preparation of Auditor's Report" will be abolished. However, this guideline will remain applicable to the audits of both consolidated and non-consolidated financial statements and for the interim audits of both interim consolidated and non-consolidated financial statements starting before April 1, 2011.

August 29,2011

On July 6, 2011, the 45th JICPA Annual General Assembly was held in the Imperial Hotel, Tokyo. More than 1,000 members and associate members attended the meeting, which was also relayed to other regional chapters of the JICPA nationwide. At the opening, Mr. Shozo Azuma, Senior Vice Minister of the Cabinet Office, and Mr. Atsushi Saito, President & CEO of the Tokyo Stock Exchange Group presented congratulatory opening remarks.

Following the report of the results of the 45th fiscal year business plan and budget statements, all assembly agendas were approved. The party held after the assembly was also a success, with total of more than 500 guests, including Diet members, and Mr. Shozo Jimi, Minister of State for Financial Services.

August 29,2011

The Auditing Standards Committee announced, on July 01, 2011, the following six Auditing Standards Committee Statements relating to an auditor's report, re-drafted as part of JICPA responses to the Clarity Project of the International Auditing and Assurance Standards Board (IAASB) of International Federation of Accountants.

■ Auditing Standards Committee Statements No.59 "Subsequent Events"

■ Auditing Standards Committee Statements No.60 "Forming an Opinion and Reporting on Financial Statements"

■ Auditing Standards Committee Statements No.61 "Modifications to the Opinion in the Independent Auditor’s Report"

■ Auditing Standards Committee Statements No.62 "phasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditor’s Report"

■ Auditing Standards Committee Statements No.63 "Comparative Information – Corresponding Figures and Comparative Financial Statements"

■ Auditing Standards Committee Statements No.64 "The Auditor’s Responsibilities Relating to Other Information in Documents Containing Audited Financial Statements" 

 This series of the recent publication of statements at JICPA corresponds to the Business Accounting Council of the Financial Services Agency's decision, in March 2010, to redraft the accounting standards, particularly such reporting standards that set out the details of an auditor's opinion in an auditor's report, in order to adjust for the main differences with the International Auditing Standards. These statements will be effective for the interim audits starting September 2011, and for audits for the financial year ending in March 2012 and subsequent periods.

August 29,2011

JICPA published, on July 1, 2011, an overview of the Quality Control Committee's review of quality control for the year ended March 31, 2010. Along with this, JICPA also published an overview of activities and "Recommendations for Activities of the Quality Control Committee for the year ended March 31, 2010" of the Quality Control Oversight Board. The board consists of five highly experienced individuals outside the profession and three CPAs, and monitors the entire process of quality control review, approves the registration of listed company audit firms, and decides measures against registered audit firms.