With regard to an internal audit, the Global Audit Department (comprising 5 members as of June 2016) conducts operational audits and provides guidance and assistance to internal audit departments of the group companies. Additionally, relevant departments and committees share functions as needed, such as daily monitoring for export control conducted by the Trade Control Department. Thereby, enhancement and improvement of company-wide audit functions are attempted.
We established Management Audit Department from April 2015 as an organization for supporting the operations of the Audit Committee to maintain and improve the audit quality of the Audit Committee. The Management Audit Department will conduct its operations in cooperation with the Audit Committee, the accounting auditor and the Global Audit Department. As we have multiple domestic and international subsidiaries in our group, and prioritize internal control of global corporate groups including such subsidiaries, Directors elected as full-time Audit Committee Members and executives of the Management Audit Department will take the positions of Audit & Supervisory Board Members (or Non-Executive Directors for companies without Audit & Supervisory Board Members) in our major domestic and international subsidiaries, sharing the burdens involved. Through this, we will enhance the functions for auditing and monitoring of subsidiaries.
The Audit Committee has established the rules on the Audit Committee and its detailed regulations and deliberates on audit policies, audit plans, audit methods, sharing of responsibilities for audit operations and other matters, in addition to the appointment of the chairperson of the Audit Committee, appointment of full-time Audit Committee Members, and other matters necessary for carrying out duties of the Audit Committee Members. Currently, Takaya Seki, an Outside Director, serves as the chairperson of the Audit Committee. Tomoyuki Kikugawa has been appointed as a full-time Audit Committee Member.
We will link this to more prompt and accurate understanding of information internally and agile auditing. Yuji Inoue, an Outside Director, worked as a General Manager of Accounting Department at his former company and experienced accounting and finance operations. Therefore, he has considerable knowledge on finance and accounting. Currently, there are total of 3 Directors elected as Audit Committee Members including 2 Outside Directors and 1 Full-Time Director who does not execute operations.
For the fiscal year ended March 31, 2016, with regard to audits conducted by the Audit Committee after the Company’s transition to a Company with an Audit Committee, the Audit Committee received the outline of audits and quarterly review plans, the summary report of quarterly review, the year-end summary report of audits, the audit report and notices issued in accordance with Article 131 of the Corporate Accounting Rules. The accounting auditor then provided the Committee with brief explanations about the information in these documents, and they exchanged opinions. In addition, Audit Committee Members conducted meetings as needed with the accounting auditor to exchange information and opinions, including the hearing of audit results.
Moreover, Audit Committee Members and the internal audit department (Global Audit Department) conducted regular and irregular meetings when necessary in order to implement effective and efficient audits. They exchanged opinions on topics such as audit policies, audit plans, and the state of audit implementation. They also undertook endeavors to strengthen collaboration through reporting of each audit.
We will utilize previous audit know-how and such from before the establishment of Audit & Supervisory Board Members and the Audit & Supervisory Board, and effective efforts which we have cultivated over the long-term will be continued and deployed. Through this, we will aim to further improve the quality and efficiency of audits.