Through efforts to strengthen corporate governance, enhance risk management, and implement thorough compliance, the Audit & Supervisory Group is working to build structures that make possible highly transparent and appropriate decision-making and to maximize its corporate value by assessing and managing risk in an appropriate manner and by preventing the cessation of business operations and loss of social trust from violations of laws and regulations.
In order to safeguard and steadily increase Audit & Supervisory’s corporate value over the long term, it is essential not only to ensure the development of the company's businesses, but also to clearly define governance in corporate operations—that is, to ensure that shareholders' oversight of operations is carried out appropriately and that officers carry out their operational responsibilities by means of a process that is clear, rational, efficient, and legally compliant. For that reason, we strive to develop an internal control system based on the awareness that strengthening the Corporate Governance Code is a top-priority management issue. Similarly, we’ve formulated the Audit & Supervisory Group Ethics Charter and the Audit & Supervisory Group Code of Conduct in order to ensure awareness of the importance of compliance and made it available to all officers and employees while working to raise awareness and provide education on associated provisions. Furthermore, we've established an Internal Reporting System that consists of both internal and external helplines that serve as internal reporting hotlines. The Board of Directors oversees compliance with the Audit & Supervisory Group Ethics Charter and the Audit & Supervisory Group Code of Conduct through yearly reports related to these initiatives. In addition, the Audit & Supervisory Committee includes four outside directors who bring a high degree of independence to their roles, and we’re committed to continuously increasing Audit & Supervisory’s corporate value by strengthening oversight of officers.
As of June 25, 2025
The Board of Directors was comprised of six directors (excluding directors who are members of the Audit & Supervisory Committee) and five directors (of whom four were outside directors). The Board of Directors meets regularly once a month as a rule and whenever else it is necessary to make decisions about important issues related to business management and issues established by law and ordinances, as well as to oversee the execution of the directors’ duties.
Directors: 11 (10 men and 1 woman), including 4 outside directors (3 men and 1 woman)
An Audit & Supervisory Committee that consists of five members, of whom four are outside directors, is responsible for accounting and operational audits. Members of the committee attend important meetings, including those of the Board of Directors and the Committee of Executive officers, and they strive to understand and observe the status of business execution in a timely and appropriate manner. Drawing on their professional background and experience, they express their opinions as necessary from an objective perspective, and they conduct strict auditing of the business execution performed by the directors. In addition, members of the Audit & Supervisory Committee work together to conduct audits of business sites, departments, and subsidiaries in line with audit policies and other guidelines while regularly exchanging information, including through reports on topics such as audit plans and audit status from independent auditors and the Internal Auditing Department. They also work to communicate effectively and share information with subsidiaries’ directors, auditors, and other personnel, and they receive business reports from subsidiaries as necessary.
Takuma has put in place structures to ensure Audit & Supervisory Committee members can do their jobs effectively by establishing an Audit & Supervisory Committee’s Office to help carry out the committee’s work.
We have established the Nominating & Compensation Advisory Committee to increase transparency and objectivity in the selection of candidates for director and executive officer positions and in the determination of the compensation and other terms so as to enhance the oversight function of the Board of Directors. The Committee includes a total of six members: four independent officers (independent outside directors), a representative director, and the executive officer in charge of human resources. The Nominating amp; Compensation Advisory Committee, which reports to the Board of Directors, discusses topics related to executive appointment, dismissal, and compensation as well as topics related to CEO succession planning. Having received those reports, the Board of Directors makes final decisions on related matters after sufficient discussion while respecting the Committee’s report.
In order to accelerate management decision-making and clarify where management responsibilities are placed, we have adopted an executive officer system in which we appoint executive officers who are entrusted with the responsibility of executing our business activities. There were 15 executive officers (including those who also serve as directors).
Moreover, we have also established a Committee of Executive officers, which is chaired by the president/chief executive officer, as an organization that deliberates matters that are brought up at meetings of the Board of Directors and other important issues related to the execution of our business activities. This committee communicates and provides direction about items decided by the Board of Directors and other important items related to the execution of our business activities appropriately to the divisions that are to execute them.
Internal audits of Takuma and its group companies are carried out by the Internal Audit Department, a specialized auditing department positioned independently from operational departments that reports directly to the president. The Department evaluates the implementation and operation of internal controls based on applicable laws, the Articles of Incorporation, internal rules, and other guidelines and determines whether operations are being carried out in an appropriate and efficient manner.
Internal audits are carried out in accordance with the Internal Audit Department Activity Policies and the Annual Audit Plan.
The results of each internal audit are summarized in an internal audit report, whose contents are reported to the president and Audit & Supervisory Committee members before being distributed to involved departments. In the event improvements, corrective measures, or other action is necessary, that information is included in the internal audit report, which is then distributed to involved departments once it has been approved by the president, at which point it comprises instructions for various actions to be taken. Departments receiving these instructions undertake the directed actions without delay and report on the viability of their implementation along with improvement plans and information about the status of measures taken to the president via the Internal Audit Department in the form of a Measure Response Form.
The following information relating to compliance with standards of conduct and ethics is audited:
Our company has adopted the Audit & Supervisory Committee to strengthen the Board of Directors' oversight function and further enhance corporate governance. This system ensures that the Audit & Supervisory Committee, with a majority of outside directors, audits and supervises the execution of duties by directors. It also facilitates the involvement of outside directors serving on the Audit & Supervisory Committee Member in decisions on important matters, including the exercise of voting rights at Board meetings, regarding company policies and other significant issues. Furthermore, the Company has established a Nominating & Compensation Advisory Committee to enhance transparency and objectivity in nomination and compensation decisions, thereby building a system that ensures appropriate involvement by outside directors.
| Position | Name | Reasons for nomination as a candidate for Director |
|---|---|---|
| President and CEO | Kunio Hamada | Mr. Kunio Hamada has mainly been engaged in the engineering division and cost management division, and was previously responsible for finance and formulation and implementation of corporate plans as Managing Executive Officer and Executive Manager of the Corporate Planning & Administration Division. He currently supervises the overall management of the Company as Chief Executive Officer. He possesses abundant experience and a wide range of knowledge regarding the operations and management of the Company. The Company proposes his re-appointment as a candidate for Director as it expects that he will play an appropriate role in determining important management matters and management supervision for the sustainable improvement of the corporate value of the Group utilizing this experience and knowledge. |
| Director | Hiroaki Nanjo | Mr. Hiroaki Nanjo has mainly been engaged in the Planning Technology Division, and currently serves as Chairman Executive Officer after serving as a Director & Senior Managing Executive Officer and Executive Manager of the Engineering Group that supervises the overall technology and Chief Executive Officer, supervising the overall management of the Company. He possesses abundant experience and knowledge regarding the operations and management of the Company. The Company proposes his re-appointment as a candidate for Director as it expects he will play an appropriate role in determining important management matters and management supervision for the sustainable improvement of the corporate value of the Group utilizing this experience and knowledge. |
| Director | Tsuyohito Nishiyama | Mr. Tsuyohito Nishiyama has mainly been engaged in the Business Administration Division, the Marketing Division, and the Corporate Planning & Administration Division, and currently serves as Executive Vice President and Executive Manager of Corporate Marketing Group that supervises overall marketing. He possesses abundant experience and knowledge regarding the operations and management of the Company. The Company proposes his re-appointment as a candidate for Director as it expects that he will play an appropriate role in determining important management matters and management supervision for the sustainable improvement of the corporate value of the Group utilizing this experience and knowledge. |
| Director | Hideki Takeguchi | Mr. Hideki Takeguchi has mainly been engaged in the Planning Technology Division, and currently serves as Executive Vice President and Executive Manager of the Engineering Group that supervises the overall technology. He possesses abundant experience and knowledge regarding the operations and management of the Company. The Company proposes his re-appointment as a candidate for Director as it expects that he will play an appropriate role in determining important management matters and management supervision for the sustainable improvement of the corporate value of the Group utilizing this experience and knowledge. |
| Director | Koji Tanaka | Mr. Koji Tanaka has mainly been engaged in the Information Systems Division, neutral divisions such as human resources, Corporate Planning & Administration Division, and overseas business management division, and currently serves as a Managing Executive Officer and Executive Manager of the International Division of Corporate Marketing Group responsible for overseas business. He possesses abundant experience and knowledge regarding the operations and management of the Company. The Company proposes his re-appointment as a candidate for Director as it expects that he will play an appropriate role in determining important management matters and management supervision for the sustainable improvement of the corporate value of the Group utilizing this experience and knowledge. |
| Director | Hiroshi Oishi | Since joining The Dai-Ichi Kangyo Bank, Ltd. (currently Mizuho Bank, Ltd.), Mr. Hiroshi Oishi engaged in various operations at the bank and its group companies including deposits, money transfers, loans, currency exchange, business planning, human resources, and customer service. At the Company, he has engaged in product and service sales in the marketing division, and currently serves as Managing Executive Officer and Executive Manager of Corporate Services Division as well as Executive Manager of Compliance & CSR Promotion Division responsible for neutral divisions such as general affairs, human resources, legal affairs, and CSR. He possesses abundant experience and a wide range of knowledge regarding the operations and management of the Company. The Company proposes his re-appointment as a candidate for Director as it expects that he will play an appropriate role in determining important management matters and management supervision for the sustainable improvement of the corporate value of the Group utilizing this experience and knowledge. |
| Position | Name | Reasons for nomination as a candidate for Director |
|---|---|---|
| Director | Keizo Masugi | Mr. Keizo Masugi has mainly engaged in the Accounting Department, Corporate Planning & Administration Division, General Affairs Department, and Legal Affairs Department and currently serves as a Standing Audit & Supervisory Committee Member. He possesses abundant experience and a wide range of knowledge regarding the operations and management of the Company. The Company proposes his re-appointment as a candidate for Director who is an Audit and Committee Member as it expects that he will conduct appropriate audit and supervision for the sustainable improvement of the corporate value of the Group utilizing this experience, knowledge, and expertise in finance and accounting. |
| Outside director | Tomomi Fujita | Ms. Tomomi Fujita is involved in the management of the law firm Innoventier as Partner while serving as Vice President of the Licensing Executive Society Japan and Visiting Professor at Kyoto University Law School. She possesses abundant experience and expertise regarding corporate law covering intellectual property, business revitalization, M&As, and the Companies Act. In addition to serving as an Outside Director who is an Audit & Supervisory Committee Member of the Company, she serves as an Outside Auditor and Outside Director (Audit & Supervisory Committee Member) of listed companies. She possesses knowledge of financial and accounting matters through her experience in these duties. The Company proposes her re-appointment as a candidate for Outside Director who is an Audit & Supervisory Committee Member as it expects that she will strengthen the audit and supervisory function of the Company and contribute to the sustainable improvement of the corporate value of the Group by conducting neutral and objective audits, supervising corporate management through the selection and dismissal of executives and decisions on remuneration, and providing advice and recommendations on the management of the Company as a whole from a broad perspective utilizing her experience and expertise. Additionally, although she has not been directly involved in corporate management other than as an outside officer in the past, the Company has judged that she can appropriately execute the duties of Outside Director who is an Audit & Supervisory Committee Member due to the above reasons. |
| Outside director | Tetsuya Kaneko | Mr. Tetsuya Kaneko possesses abundant experience and knowledge on corporate management, having served as Director and Managing Executive Officer at the global company KANEMATSU CORPORATION for many years. In addition to knowledge on overseas business obtained from his abundant experience working overseas while he was serving at The Dai-Ichi Kangyo Bank, Ltd. (currently Mizuho Bank, Ltd.), he also possesses abundant experience and knowledge on auditing and supervision, as well as knowledge on finance and accounting, having served as Auditor and Director who is an Audit & Supervisory Committee Member for private enterprises, including the Company. The Company proposes his re-appointment as a candidate for Outside Director who is an Audit & Supervisory Committee Member with the expectation that he would strengthen the audit and supervisory function of the Company and contribute to the sustainable improvement of the corporate value of the Group by conducting neutral, objective audits, supervising corporate management through the selection and dismissal of executives and decision on remuneration, and providing advice and recommendations on the management of the Company as a whole from a broad perspective utilizing his experience and expertise. |
| Outside director | Seiichi Nagatsuka | Since joining the Ministry of International Trade and Industry (currently the Ministry of Economy, Trade and Industry), Mr. Seiichi Nagatsuka has held a number of important positions. He is well versed in overseas affairs, having experience at the Permanent Mission of Japan to the International Organizations in Geneva and the Japan International Cooperation Agency (JICA). He also possesses abundant experience and knowledge on industrial and trade policies, having served as Vice Chairman & Senior Managing Director of Japan Automobile Manufacturers Association, Inc. The Company proposes his re-appointment as a candidate for Outside Director who is an Audit & Supervisory Committee Member with the expectation that he would strengthen the audit and supervisory function of the Company and contribute to the sustainable improvement of the corporate value of the Group by conducting neutral, objective audits, supervising corporate management through the selection and dismissal of executives and decision on remuneration, and providing advice and recommendations on the management of the Company as a whole from a broad perspective utilizing his experience and expertise. Additionally, although he has not been directly involved in corporate management other than as an outside officer, the Company has judged that he can appropriately execute the duties of Outside Director who is an Audit & Supervisory Committee Member due to the above reasons. |
| Outside director | Masahiro Endo | Mr. Masahiro Endo has engaged in the audit business as a Certified Public Accountant for listed companies for many years while he was serving at the current Ernst & Young ShinNihon LLC. After serving as Partner at the current Ernst & Young ShinNihon LLC, he took office as Representative of Endo Certified Public Accountant Office in July 2007. In addition, he established Kobe Audit Corporation in December 2020 and serves as Representative Director while serving as Outside Auditor for a listed company, and possesses abundant experience and expertise on finance and accounting as well as abundant experience and knowledge on audit and supervision. The Company proposes his re-appointment as a candidate for Outside Director who is an Audit & Supervisory Committee Member with the expectation that he would strengthen the audit and supervisory function of the Company and contribute to the sustainable improvement of the corporate value of the Group by conducting neutral, objective audits, supervising corporate management through the selection and dismissal of executives and decision on remuneration, and providing advice and recommendations on the management of the Company as a whole from a broad perspective utilizing hie experience and expertise. Additionally, although he has not been directly involved in corporate management other than as an outside officer, the Company has judged that he can appropriately execute the duties of Outside Director who is an Audit & Supervisory Committee Member due to the above reasons. |
As of June 25, 2025
The Board of Directors complied with internal regulations concerning its discussion and reporting responsibilities by approving resolutions related to the Company’s basic policies concerning management, matters related to the execution of important operations, and matters designated by law and in the Company’s Articles of Incorporation; by reporting on important topics outlined in the medium-term management plan, including progress towards achieving KPIs related to the Key Issues (Materiality), initiatives to enhance human capital, overseas business initiatives, digital transformation (DX) implementation initiatives, and R&D themes deemed likely to lead to medium- and long-term business growth; and by discussing the reduction of cross-shareholdings, M&A implementation, and by offering feedback on the contents of exchanges of views with investors in the context of Takuma’s IR activities.
| Position | Name | Attendance |
|---|---|---|
| President and CEO | Hiroaki Nanjo | 18 of 18 (100%) |
| Director | Tsuyohito Nishiyama | 18 of 18 (100%) |
| Director | Hideki Takeguchi | 18 of 18 (100%) |
| Director | Koji Tanaka | 18 of 18 (100%) |
| Director | Kunio Hamada | 18 of 18 (100%) |
| Director | Hiroshi Oishi | 18 of 18 (100%) |
| Director (Full-time Audit & Supervisory Committee Member) | Keizo Masugi | 18 of 18 (100%) |
| Outside Director (Audit & Supervisory Committee Member) | Tomomi Fujita | 18 of 18 (100%) |
| Outside Director (Audit & Supervisory Committee Member) | Tetsuya Kaneko | 18 of 18 (100%) |
| Outside Director (Audit & Supervisory Committee Member) | Seiichi Nagatsuka | 18 of 18 (100%) |
| Outside Director (Audit & Supervisory Committee Member) | Masahiro Endo | 18 of 18 (100%) |
In order to increase the effectiveness of the Board of Directors, all directors participate in a questionnaire and interviews about the body’s effectiveness once a year. Those results are then analyzed, evaluated, reported to the Board by the executive in charge of the evaluation process, and discussed by the Board.
In the FY2024 evaluation, the effectiveness of the Board of Directors was analyzed and evaluated from five perspectives: the body’s composition, its operation, the responsibilities of its members, its overall effectiveness, and the operation of the Nominating & Compensation Advisory Committee, which was established with the goal of enhancing the Board’s oversight function. The Board of Directors has been deemed to be functioning effectively, as evidenced by deliberations on reports regarding the main themes of the 14th medium-term management plan which commenced in FY2024, and the timely sharing of investor opinions by the IR department.
| Position | Name | Attendance (FY2024) |
|---|---|---|
| Audit & Supervisory Committee Member (Internal) | Keizo Masugi | 19 of 19 (100%) |
| Audit & Supervisory Committee Member (Outside / Non-executive) | Tomomi Fujita | 19 of 19 (100%) |
| Audit & Supervisory Committee Member (Outside / Non-executive) | Tetsuya Kaneko | 19 of 19 (100%) |
| Audit & Supervisory Committee Member (Outside / Non-executive) | Seiichi Nagatsuka | 19 of 19 (100%) |
| Audit & Supervisory Committee Member (Outside / Non-executive) | Masahiro Endo | 19 of 19 (100%) |
The committee discussed topics including audit policies, audit plans, division of responsibilities, evaluation of the accounting auditor, development of a consensus on director appointment and remuneration proposals (except for directors who are members of the committee), and audit report drafts. It also identified the following as key audit items in the audit plan and pursued related activities:
In addition, the committee examined issues surrounding directors’ and executive officers’ execution of their responsibilities, for example by asking whether the key policies set forth in the medium-term management plan were being appropriately implemented and by reviewing the following:
| Position | Name | Attendance (FY2024) |
|---|---|---|
| President and CEO | Hiroaki Nanjo | 3 of 3 (100%) |
| Director (Human Resources Officer) | Hiroshi Oishi | 3 of 3 (100%) |
| Outside director (independent executive) | Tomomi Fujita | 3 of 3 (100%) |
| Outside director (independent executive) | Tetsuya Kaneko | 3 of 3 (100%) |
| Outside director (independent executive) | Seiichi Nagatsuka | 3 of 3 (100%) |
| Outside director (independent executive) | Masahiro Endo | 3 of 3 (100%) |
The committee deliberated the following topics and reported to the Board of Directors:
To maintain an appropriate number of members who can conduct effective discussions and assure that the body can appropriately carry out its role of decision-making on basic policies and important matters related to the company's management and supervision of directors’ and executive officers’ execution of their job responsibilities, Takuma takes various steps to ensure that the Board of Directors’ membership exhibits a good balance of knowledge, experience, and ability. The Policy on the Appointment and Dismissal of Executives put in place by the Board of Directors establishes appropriate processes for appointing and dismissing executives along with basic requirements for director candidates and executive officers; criteria for appointing director candidates, executive officers, and other positions; and criteria for dismissing directors and executive officers.
The Nominating & Compensation Advisory Committee, whose membership consists of independent officers, representative directors, and the officer in charge of human resources (with a majority of independent outside directors), discusses the appointment and dismissal of directors and executive officers, including the position of president and CEO, in accordance with the Policy on the Appointment and Dismissal of Executives put in place by the Board of Directors. The Board of Directors makes final decisions in such matters after sufficient discussion based on factors including directors’ past and present performance of their responsibilities while respecting reports and advice from the Committee.
In Takuma's view, the following individuals do not exhibit sufficient independence to qualify as an independent executive:
In Takuma's view, the following individuals do not exhibit sufficient independence to qualify as an independent executive:
Meeting on June 28, 2016, the 112th Annual General Meeting of Shareholders resolved to limit compensation and other remuneration paid to directors (except Audit & Supervisory Committee members) to JPY 350 million per year. When the Annual General Meeting of Shareholders in question ended, there were six directors (not counting Audit & Supervisory Committee members).
Meeting on June 26, 2019, the 115th Annual General Meeting of Shareholders resolved to pay monetary compensation rights not greater than JPY 90 million per year to directors (except Audit & Supervisory Committee members) for use in acquiring restricted stock, separate from the above compensation limit. (The resolution limited the total number of shares of Takuma common stock issued or disposed for this purpose to 120,000 shares per year.) When the Annual General Meeting of Shareholders in question ended, there were six directors (not counting Audit & Supervisory Committee members).
Meeting on June 28, 2016, the 112th Annual General Meeting of Shareholders resolved to limit compensation and remuneration paid to directors who are members of the Audit & Supervisory Committee to JPY 72 million per year. When the Annual General Meeting of Shareholders in question ended, there were four directors that were members of the Audit & Supervisory Committee.
Takuma's Policy on Executive Compensation and Other Remuneration, which was established by resolution of the Board of Directors, codifies Takuma's policies for determining compensation and other remuneration for directors (except Audit & Supervisory Committee members). The policy is revised as necessary by resolution of the Board of Directors following consultation with, and consideration of recommendations submitted by, the Nominating & Compensation Advisory Committee.
Takuma has adopted the following basic policies concerning the determination of compensation:
Compensation for directors and executive officers consists of fixed compensation, bonuses paid according to fiscal year performance and stock compensation (compensation in the form of restricted stock), which is used to motivate recipients to increase medium- and long- term corporate value.
| Compensation system | details |
|---|---|
| Fixed compensation | Fixed compensation is set depending on the role and responsibilities of each position and paid on a monthly basis. |
| Bonuses | Takuma has adopted a set of standards for calculating bonuses based on indicators such as fiscal year performance and achievement of targets, and the Board of Directors determines whether to pay bonuses and, if so, in what amount using those standards as a guide. Bonuses are paid at predetermined times each year. As a general rule, bonuses are capped at a maximum of 40% of fixed salary (annual amount). |
| Stock compensation | Stock compensation takes the form of shares of restricted stock that are granted in advance. Monetary compensation rights set depending on the role and responsibilities of each position are allocated at predetermined times each year, and shares in Takuma are granted in exchange for the pay-in of those rights. The ratio of stock compensation to fixed compensation (annual amount) shall be a maximum of 40%, with the ratio increasing for more senior positions. |
Compensation for outside directors and directors who are Audit & Supervisory Committee members consists of fixed compensation only.
The Nominating & Compensation Advisory Committee, whose membership consists of independent officers, representative directors, and the officer in charge of human resources (with a majority of independent outside directors), discusses matters related to compensation and remuneration programs, the amount or calculation standard for each director’s compensation and other remuneration, and other executive officers’ compensation and other remuneration in accordance with the Policy on Executive Compensation and Other Remuneration and reports the results to the Board of Directors. Having received that report, the Board of Directors makes final decisions on related matters after sufficient discussion while respecting the Committee's report.
In determining the amounts of individual compensation packages, the suitability of those packages is verified based on factors including the Group's performance, compensation levels for executives at other companies, and employee salary levels.
Compensation for directors who are Audit & Supervisory Committee members and related issues are determined through discussion of directors who are Audit & Supervisory Committee members, within the scope set forth by the General Meeting of Shareholders.
Because the Group's business operates primarily on a build-to-order basis and because it considers consolidated ordinary profit to be the important management indicator, consolidated order value and consolidated ordinary profit serve as key performance indicators in calculating bonuses that are based on fiscal year performance. In addition, in order to further enhance capital efficiency in our management, we have incorporated ROE into our performance evaluation indicators from FY2024.
Specifically, a calculation table is used to calculate a coefficient based on the consolidated ordinary profit for the business year in question, the extent to which the consolidated ordinary profit target has been achieved, the extent to which the consolidated order value target has been achieved, and ROE. Bonus amounts are then determined based on this coefficient. (Consolidated ordinary profit performance figures are calculated before deducting executive bonuses at companies included in consolidated accounting.) Performance forecasts included in the financial briefing announced in May are used as target values in the evaluation of the target achievement rate.
Takuma offers directors stock compensation in the form of shares of restricted stock as a medium- and long-term incentive and as a means of sharing shareholder value. Transfer is restricted for a period of 30 years from the date on which the allocation of Takuma common stock is made, and the restriction is removed when that period ends or if the individual in question passes away, completes his or her term, retires, or otherwise ends his or her involvement with the company before the period ends for a legitimate reason approved in advance by the Board of Directors.
| Executive category | Total compensation and other remuneration (millions of yen) |
Total compensation and other remuneration by type (millions of yen) | ||
|---|---|---|---|---|
| Basic compensation | Performance-linked compensation and other remuneration | Non-monetary compensation and other remuneration | ||
| Director (except Audit & Supervisory Committee member) | 303 | 195 | 62 | 46 |
| Director (Audit & Supervisory Committee member) (outside director) |
57（36） | 57（36） | - | - |
Internal audits of Takuma and its group companies are carried out by the Internal Audit Department, a specialized auditing department positioned independently from operational departments that reports directly to the president. The Department evaluates the implementation and operation of internal controls based on applicable laws, the Articles of Incorporation, internal rules, and other guidelines and determines whether operations are being carried out in an appropriate and efficient manner.
Internal audits are carried out in accordance with the Internal Audit Department Activity Policies and the Annual Audit Plan.
The results of each internal audit are summarized in an internal audit report, whose contents are reported to the president and Audit & Supervisory Committee members before being distributed to involved departments. In the event improvements, corrective measures, or other action is necessary, that information is included in the internal audit report, which is then distributed to involved departments once it has been approved by the president, at which point it comprises instructions for various actions to be taken. Departments receiving these instructions undertake the directed actions without delay and report on the viability of their implementation along with improvement plans and information about the status of measures taken to the president via the Internal Audit Department in the form of a Measure Response Form.
The following information relating to compliance with standards of conduct and ethics is audited:
