What's New (Dec, 2011)

December 28,2011

The recently reported corporate scandals of certain listed companies in Japan are matters of much concern from the perspective of securing public trust in the Japanese capital markets.

Our members, both certified public accountants (CPAs) and audit firms, have been carrying out their work faithfully and in an independent manner, all in accordance with the missions and responsibilities delegated to our profession.

With respect to the recent corporate scandals, the Japanese Institute of Certified Public Accountants (JICPA), as a self-disciplinary professional body, has started its investigation into the past audit engagements of the CPAs and audit firms. In the event our investigation concludes that the practice of our members involved in the audits infringed on our standards and rules, we will execute appropriate measures against responsible members, in accordance with the provisions of our constitution.

Audits　conducted by CPAs are performed on the premise that appropriate corporate governance　is in effect. In the past, JICPA has made proposals to strengthen corporate governance in Japanese companies. Likewise, with the occurrence of the recent scandals,　if it becomes necessary to further improve corporate governance in Japan, we are determined to take the required steps, and　request appropriate parties to initiate further changes in this area.

December 28,2011

JICPA published, on November 10, 2011, a summary report of the Quality Control Committee, related to its review for the six months ended September 30, 2011, with the approval by the Executive Board Meeting held on November 8, 2011.

The JICPA quality control review, as prescribed by the JICPA Constitution, is performed for audits conducted by audit firms engaging in audits of listed companies and other certain large companies etc. under the CPA Act, in order to maintain and improve the quality of audit practices and to ensure the public trust in audits.

The report was submitted to the Quality Control Oversight Board (members include five highly experienced individuals outside the profession and three CPAs) on October 28, 2011, and evaluation was performed for the adequacy of the quality control reviews by the Quality Control Committee. The report is available in Japanese only.

December 28,2011

The Certified Public Accountants and Auditing Oversight Board (CPAAOB) released, on November 14, 2011, the list of applicants who passed the CPA examination in 2011. Out of 23,151 applicants, 1,511 candidates passed all subjects, with the examination pass rate of 6.5%.

December 28,2011

JICPA concluded, on October 17, 2011, “Letter of Agreement for the Provision of Support to SMEs damaged by the North Eastern Japan Earthquake” with Small & Medium Enterprises and Regional Innovation, JAPAN (SME Support, Japan), an independent administrative agency under the Ministry of Economy, Trade and Industry. 

This agreement was concluded so that both parties mutually support and contribute to the rebuilding of SMEs in the affected area. With this agreement, JICPA will mainly provide advisory services to SMEs, in cooperation with SME Support, Japan.

December 26,2011

JICPA has completed the translation of the International Financial Reporting Standard for Small and Medium-sized Entities (IFRS for SMEs) and related materials issued by the International Accounting Standards Board (IASB) in July 2009.

The Japanese translation of the IFRS for SMEs including the Basis for Conclusions, Illustrative Financial Statements, and Presentation and Disclosure Checklist can be accessed online via “Access the IFRS for SMEs” on the website of the IFRS Foundation and the IASB;

http://www.ifrs.org/IFRS+for+SMEs/IFRS+for+SMEs+and+related+material.htm