Cost of responding to J-SOX’s internal control requirements averages ¥160 million*1
- Burden heaviest on smallest companies -
*1: Total of costs incurred in last and current fiscal years
May 11, 2009
|♦15% of companies with sales of less than ¥10 billion may have Material Weakness in internal control, while the rate is 2% among larger companies.|
♦Half of small companies are not satisfied with their own audit and struggle to respond to external auditors' requirements.
♦Widespread calls for easing standards for smaller companies.
In February 2009, The Japan Research Institute, Limited (JRI) conducted the "Survey of J-SOX Internal Control Development and Assessment" in its second year.
(see the last year result http://www.jri.co.jp/english/release/2008/080724/).
This year's survey reveals the problems in responding to J-SOX’s internal control reporting system for the initial year, in terms of
1. Organization and schedule
2. Internal control audit by the company
3. Internal control audit by accounting auditors
4. The companies’ views on the internal control reporting system
On the basis of the results of the survey, JRI has made proposals on enhancement of existing internal control systems as practical management infrastructures to improve their performance.
For more information on the content of this report, please contact Masayuki Ohbayashi, the Japan Research Institute, Limited.