Engagement Objectives

Assessment of Internal Controls:

•Evaluate the design and operating effectiveness of Bank’s internal controls over financial reporting to identify any deficiencies or weaknesses.

Compliance with SOX Requirements:

•Determine if the company complies with the relevant SOX and JSOX provisions and regulations, including Sections 302 (Certification of Financial Statements) and 404 (Assessment of Internal Control).

Recommendations:

•Provide recommendations for improving internal controls and addressing any identified weaknesses to enhance financial reporting accuracy and compliance.

Coordinate with Head Quarters:

•Work alongside with the Japanese SOX HQ team to gather SOX related policy and discuss any key findings relating to the EMEA Securities subsidiary.

Our Response and Approach

Planning and Risk Assessment:

•Conducted an initial risk assessment to identify key areas of financial risk.

•Collaborated and worked with management to understand the company's control environment and any recent changes.

Testing Internal Controls:

•Performed substantive testing and tests of controls to assess the design and operating effectiveness of key internal controls.

•Tested controls related to financial reporting, including revenue recognition, expense accruals, and inventory valuation.

Identification and Evaluation:

•Identified control deficiencies and weaknesses.

•Assessed the overall control environment, considering the adequacy of policies and procedures.

Recommendations and Reporting:

•Presented findings to the audit committee and senior management, highlighting control deficiencies and their potential impact.

•Provided actionable recommendations for strengthening internal controls and achieving SOX compliance.

Value Delivered

Enhanced Control Environment:

•Our review identified weaknesses in certain internal controls, prompting management to implement stronger controls and segregation of duties, reducing the risk of financial misstatements.

SOX Compliance:

•By addressing control deficiencies, the subsidiary achieved stronger compliance with SOX requirements, ensuring the accuracy and reliability of its financial statements.

Improved Efficiency:

•Streamlined processes and enhanced automation of certain controls resulted in improved operational efficiency, reducing the potential for errors and fraud.