“FAQ on Companies’ Integral Disclosure of Business Reports, etc. and Securities Reports” Compiled

1. Background

Under the related systems, companies are presently eligible to compile one report that meets the requirements under both the Companies Act and the Financial Instruments and Exchange Act and to disclose the report to their shareholders before holding shareholder meetings.

In 2018, the related ministries and agencies prepared and published descriptive examples* involving companies’ integral disclosure of business reports, etc. and securities reports (hereinafter referred to as “integral disclosure”) as a measure for supporting companies engaging in trial efforts for integral disclosure of business reports and financial statements under the Companies Act (hereinafter referred to as the “business reports, etc.”) and securities reports under the Financial Instruments and Exchange Act.

*Note: Measures for Supporting Efforts for Encouraging Companies to Integrally Disclose Business Reports, etc. and Securities Reports (report jointly formulated by the Cabinet Office, the Financial Services Agency, the Ministry of Justice and METI on December 28, 2018)

Aiming to disseminate integral disclosure across practical operations of companies, METI continued to hold repeated discussions with corporate practitioners and stakeholders of disclosure (audit firms, related organizations, etc.) who prepare documents subject to disclosure, even after the publishing of descriptive examples in December 2018. METI organized many inquiries about the examples that it received from companies and compiled the results into a “FAQ on Companies’ Integral Disclosure of Business Reports, etc. and Securities Reports (Institutional Edition).” It hereby releases it.

Dissemination of integral disclosure across practical operations of companies is expected to help companies to effectively and efficiently disclose their reports and to facilitate constructive dialogues with investors.

Moreover, on January 18, 2021, the Japanese Institute of Certified Public Accountants (JICPA) published a draft sample wording of audit reports for integral disclosure. METI hereby announces it as well.

METI will strive to advance efforts for helping companies to smoothly carry out integral disclosure.

2. Materials published by METI

• Material: FAQ on Companies’ Integral Disclosure of Business Reports, etc. and Securities Reports (Institutional Edition) (in Japanese) (PDF:757KB)
• Reference: Summary of the FAQ on Companies’ Integral Disclosure of Business Reports, etc. and Securities Reports (Institutional Edition) (in Japanese) (PDF:1,080KB)

3. Material released by JICPA

• Release of Research Report by the Auditing and Assurance Practice Committe e titled “Research Report on Audit Reports Concerning Financial Statements Contained in Integral Disclosure of Business Reports, etc. and Securities Reports” (Release of Draft Report) (in Japanese)

Division in Charge

Corporate Accounting, Disclosure and CSR Policy Office, Economic and Industrial Policy Bureau