Press Conference by Kaoru Yosano, Minister of State for Economic and Fiscal Policy and Financial Services


March 31, 2006


Yesterday, a criminal complaint was filed against two accountants at Koyo, an auditing firm, in association with the Livedoor accounting fraud scandal. Also, accountants at ChuoAoyama PricewaterhouseCoopers admitted the facts charged in the Kanebo accounting fraud scandal yesterday. What are your thoughts on the series of accounting incidents which may cause distrust in the accounting profession? How will the Financial Services Agency (FSA) respond to auditing firms?


Auditors conduct audits by profession, but in addition to this aspect, they characteristically engage in their duties with a huge social responsibility. This is not limited to Certified Public Accountants and auditing firms in that, for example, lawyers are also in an occupation with huge social responsibilities. In that sense, it is extremely regrettable that a series of scandals involving auditors have arisen. It is necessary to properly examine what to do in response to the scandals and take measures somewhere, including addressing how auditing firms or auditors ought to be, rather than just reprimanding those who were involved in the scandals in various ways. While we have not formally decided where to hold proper discussions, the Financial System Council is already in place, so we will consult with them and take urgent action to properly deal with audits in general for the future.


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