Basic policy for our internal control system
Maruka Furusato Corporation has resolved through its Board of Directors to establish a basic policy governing the construction of an internal control system designed to ensure the appropriateness of business operations which Maruka Furusato Corporation, our subsidiaries, and our affiliated companies (hereafter, the UNISOL Group) conduct.
On the basis of this policy, and guided by an agile and unified Group management approach, we are continually working to strengthen and improve our Group governance structure, striving to build an efficient and highly transparent management system that will drive sustainable growth and enhance long-term corporate value for the UNISOL Group.
Basic policy on internal controls relating to financial reporting
To ensure appropriate financial reporting, Maruka Furusato Corporation has established a basic policy for internal controls relating to financial reporting.
This establishes guiding principles, in compliance with the Financial Instruments and Exchange Act and other laws and regulations, including maintaining and operating systems for evaluating and reporting on the efficacy and efficiency of our internal controls relating to financial reporting, as well as ensuring that employees at all of our Group companies are fully aware of the importance of our internal controls and striving to ensure appropriate financial reporting at both a company-wide and an operational process-level.
Our internal control system
We have established an Internal Control Committee, whose aim is to maintain a Group-wide internal control system. This Committee verifies the appropriateness of our financial reporting and the efficacy of audits of our internal controls with reference to the Financial Instruments and Exchange Act. An Internal Control Secretariat also operates under the Internal Control Committee, to provide support for the latter’s operations.
Overview of our Internal Control Committee
- This Committee is under the purview of and chaired by our President. Its membership consists of the General Manager and Deputy General Manager of our Administrative Headquarters, the General Manager of our Group Governance Unit, and any further members designated by the President.
- It monitors the effective and efficient maintenance and operation of the UNISOL Group’s internal controls relating to financial reporting and remedies and provides guidance on any issues encountered.
- It acts as the final decision-making body in the advancement of our internal controls, including deciding policy, formulating annual plans for the implementation of internal controls, tracking progress, and providing final approval of self-evaluations.
- Matters relating to internal control at our Group companies are discussed and then implemented by this Committee, our Internal Audit Office, Internal Control Committees (or divisions charged with this function) at Group companies, and internal audit divisions (or personnel in charge of this function) at Group companies. Any issues deemed key are reported to the Board of Directors and our Audit and Supervisory Committee and its members in an appropriate and timely manner.
Overview of our Internal Control Secretariat
- This Secretariat is positioned within the Internal Control Committee and supports the operation of that Committee.
Membership of the Secretariat comprises those judged suitable for the position by the Committee. - In line with policy, and on the basis of annual plans for the effective maintenance, operation, and evaluation of our internal controls over each fiscal year, the Secretariat tracks overall progress on these plans and provides practical assistance for internal control documentation and evaluation.
- It serves as the first point of contact for discussion of any deficiencies discovered by external audits of our internal controls. It reports the details of these discussions to the Committee, the full-time members of our Audit and Supervisory Committee, and our Internal Audit Office in an appropriate and timely manner, and tracks progress on measures to remedy these deficiencies.
- It produces an internal control report summarizing the year’s evaluations of the effectiveness of the UNISOL Group’s internal controls relating to financial reporting and delivers this to the Committee annually (at fiscal year-end).