Fujitsu 2006 Annual Report Download - page 39

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Annual Report 2006
(5) Systems for Ensuring the Propriety of Fujitsu Group
Business Activities
qIn order to continuously improve the corporate value of the
Fujitsu Group, the Company shall, in accordance with The
FUJITSU Way, provide guidance and support to Fujitsu
Group company senior managers to ensure that proper sys-
tems are in place throughout the Group to efficiently and
properly adhere to points (1)–(4).
wSpecifically, in regard to the issues mentioned in the previ-
ous item, we shall prepare a set of Fujitsu Group Manage-
ment Regulations that specify each company’s role,
responsibilities, lines of authority, decision-making proce-
dures, and other matters.
eSenior managers from Fujitsu Limited and Fujitsu Group
companies shall meet regularly for updates on the Group’s
management direction and to address issues relating to achiev-
ing business performance targets. In addition, the statutory
auditors of Fujitsu Group companies shall meet to address
issues facing the Fujitsu Group from an audit perspective.
rSenior managers from Fujitsu Limited and each Group com-
pany shall formulate policies to resolve any obstacles relating
to meeting business performance targets identified in the pre-
vious item, and implement appropriate policies after a thor-
ough discussion of the issues. If necessary, Fujitsu Limited shall
receive reports or applications for approval as shall be specified
separately in the Fujitsu Group Management Regulations.
tThe Company’s internal audit division shall coordinate with
each Group company’s internal audit division to perform
internal audits of the entire Fujitsu Group. Findings shall be
regularly reported to the boards of directors and/or statutory
auditors of Fujitsu Limited and the Group company concerned.
Important matters relating to Fujitsu Group companies
are reported to Fujitsu’s Board of Directors and Board of
Statutory Auditors.
(6) Systems for Ensuring the Propriety of Audits by
Statutory Auditors
<Provisions to Ensure Independence>
qThe Company shall staff the Statutory Auditors’ Office with
employees to help the statutory auditors perform their duties.
Employees selected for this purpose shall have the capabili-
ties and knowledge needed to meet the requirements of the
statutory auditors.
wTo ensure the independence of the employees assigned to the
Statutory Auditors’ Office, senior managers shall consult in
advance with the statutory auditors regarding personnel
issues for these employees, including appointments, transfers,
and compensation.
eAs a general principle, senior managers shall not have
employees assigned to the Statutory Auditors’ Office assume
concurrent responsibilities with other units. If, however, the
statutory auditors request the assistance of employees with
specialized expertise, necessitating concurrent responsibili-
ties for those employees, the provisions in the preceding item
ensuring independence shall apply to those employees.
<Provisions for Reporting>
qSenior managers from Fujitsu Limited and each Group com-
pany shall provide opportunities for statutory auditors to
attend important meetings.
wSenior managers and employees from Fujitsu Limited and
each Group company shall immediately notify the statutory
auditors of any incidences of risk that impact management
or financial performance, or if they become aware of evi-
dence of major compliance violations relating to the con-
duct of business activities.
eSenior managers and employees from Fujitsu Limited and
each Group company shall make periodic reports to the
statutory auditors on issues relating to the execution of
business operations.
<Provisions to Ensure Effectiveness>
qSenior managers from Fujitsu Limited and each Group
company shall regularly exchange information with the
statutory auditors.
wThe Corporate Internal Audit Division shall regularly report
its findings to the statutory auditors.
eThe statutory auditors shall, on an as-needed basis, receive
presentations or reports from the accounting auditors on their
accounting audit findings and shall, on a regular basis,
exchange information.
* In
The FUJITSU Way , the term ‘employees’ refers to employees of the Fujitsu
Group. The same usage is applied in these basic policies.
(iii) Status of Audits by Statutory Auditors, Internal Audits,
and Accounting Audits
Fujitsu has adopted a statutory auditor system. Auditors attend
important management meetings, including those held by the
Board of Directors, the Management Strategy Council, and the
Management Council, to audit the Board of Directors and
operational execution bodies. In addition, the Corporate Internal
Audit Division has been established so serve as an internal audit
group. This division audits the internal affairs of the Company and
its affiliates, proposes improvement in their business practices, and
regularly reports its audit findings to the Management Council.
Accounting audits are carried out by Ernst & Young
ShinNihon, which reports to the Board of Statutory Auditors on
the auditing plan and auditing results, and when necessary,
exchanges opinions and conducts joint audits with the statutory
auditors. Accounting audit work is carried out by four certified
public accountants at Ernst & Young ShinNihon. They are Yoji
Suzuki (22 continuous years auditing the financial statements of
Fujitsu*), Yuichi Mochinaga (9 years*), Noriyuki Tsunoda, and
Hideaki Karaki. Other Ernst & Young ShinNihon employees that
assist with the audits are 21 certified public accountants, 25 assis-
tant certified public accountants, and 5 accounting staff members.
*Ernst & Young ShinNihon has introduced a rotation system for employees
engaged in accounting audits. This move was voluntarily taken prior to the
enactment of regulations based on the Certified Public Accountant Law and the
implementation of self-imposed rules by the Japanese Institute of Certified Pub-
lic Accountants. Ernst & Young ShinNihon plans to implement this system from
the current consolidated fiscal year.