J-SOX Compliance Support Services

The internal control reporting system under the Financial Instruments and Exchange Act (commonly referred to as J-SOX) is a critical regulatory requirement for listed companies in Japan. Listed companies are responsible for appropriately evaluating the design and operation of their internal controls, documenting the results, and disclosing their assessments.

At our firm, Certified Public Accountants with backgrounds at major audit firms provide practical and effective J-SOX support, focusing not only on formal compliance but also on building internal controls that function in real-world operations.

1.Initial Assessment & Gap Analysis

We begin with a rigorous, multi-faceted assessment of your company’s existing internal control environment. Our goal is to establish a clear roadmap by identifying the gap between current practices and regulatory expectations.

Gap Analysis: Conducting a comprehensive comparison between current management practices and J-SOX requirements.
Process & IT Control Review: Evaluating the design of core business processes and the robustness of IT General Controls (ITGC).
Documentation & Operating Effectiveness Review: Assessing the status of existing documentation and the actual performance of control activities.

In this phase, we look beyond mere procedural compliance to uncover operational inefficiencies and latent risks embedded within the organization. For companies pursuing J-SOX compliance for the first time, this diagnostic phase is essential for establishing a clear, enterprise-wide baseline.

2.Internal Control Design ＆ Documentation Support

Based on the current state assessment, we support the design and documentation of internal controls in accordance with J-SOX requirements.

Preparation of Process Narratives and Risk Control Matrices (RCMs): Developing precise documentation that accurately reflects your business flow and risk landscape.
Design and Implementation of Control Activities: Providing hands-on support for essential controls, including approval workflows, segregation of duties, and access management.
IT and Entity-Level Controls: Establishing the necessary documentation and operational frameworks for both IT general controls and organization-wide governance.

We emphasize practical control design that aligns with actual business processes, ensuring compliance without imposing unnecessary burdens on day-to-day operations. Internal controls should not be merely a formal requirement; they should serve as a valuable mechanism for enhancing operational quality and corporate governance.

3.Operational Support & Monitoring Framework

Internal controls must be more than well designed; they must be executed consistently and effectively in day-to-day operations.. We focus on embedding these controls into your corporate culture.

Design of Monitoring Procedures: Establishing robust self-assessments, internal audits, and management review processes.
Support for Evidence Preparation and Retention: Assisting in the systematic preparation and retention of operational evidence to ensure audit readiness.
Evaluation of Key Controls: Developing periodic assessment methodologies for key controls to maintain long-term effectiveness.
Remediation Strategy: Building efficient workflows to address and remediate any control deficiencies identified during testing.

Our ultimate goal is to empower your organization to operate and maintain internal controls independently. We support the creation of a sustainable framework that minimizes excessive reliance on external advisors and fosters internal expertise.

4.Management Assessment & Internal Control Report Support

Under the J-SOX framework, management is required to evaluate the effectiveness of internal controls and issue an official Internal Control Report. We provide the strategic and technical support necessary to fulfill these reporting obligations with confidence.

Scoping Support: Assisting in the precise definition of evaluation boundaries, including the identification of key business locations and significant processes.
Execution of Evaluation Procedures: Conducting or reviewing internal control testing to ensure rigorous and objective assessments.
Documentation for Management’s Assessment: Synthesizing evaluation results into professional working papers and supporting documentation to substantiate management’s final conclusions.
Drafting the Internal Control Report: Providing expert guidance on drafting the report to ensure accurate and transparent disclosure.

Our Certified Public Accountants, drawing on deep expertise from Big 4 audit firms, provide practical, audit-ready support. We bridge the gap between management’s responsibilities and the expectations of external auditors, ensuring a seamless and defensible reporting process.

5.IPO Preparation & Group-Wide Implementation Support

J-SOX compliance is not limited to currently listed companies; it is a vital prerequisite for organizations preparing for an IPO and for those that have joined a listed group as a result of M&A. We provide specialized support tailored to these specific scenarios:

IPO Readiness & Roadmap Development: Designing internal control implementation schedules aligned with your IPO timeline to ensure compliance by the target listing date.
Standardization of Group-Wide Controls: Supporting the rollout of standardized formats and methodologies to ensure consistency across the entire corporate group.
Alignment with Parent Company Governance: Standardizing entity-level and IT controls to align with the parent company’s reporting standards and governance requirements.

We offer flexible support frameworks that adapt to each company’s unique growth stage and organizational structure, facilitating a smooth transition into the public markets or a larger corporate group.

Contact Us

We offer free initial consultations and preliminary assessments.
A Certified Public Accountant will personally conduct the consultation and
propose the most suitable valuation approach for your company.

For inquiries or consultations, please contact us via the Inquiry Form.

03-3484-0878

The preparation of the formal “three key documents” — process narratives, flowcharts, and Risk Control Matrices (RCMs) — often becomes an end in itself, resulting in additional layers of checks that provide little practical value to operational teams.

When deficiencies are identified, the proposed remediation measures sometimes fail to align with actual business operations, making it difficult to sustain effective implementation.

In some cases, companies rely heavily on external consultants, leaving little internal know-how accumulated within the organization while the annual evaluation costs remain persistently high.

Preparing the three key documents takes an enormous amount of time. We would like to improve this process.

Rather than documenting everything in detail, we propose a streamlined approach based on risk materiality. We can also coordinate with your external auditors to simplify documentation where appropriate. If internal resources are limited, outsourcing options through our external partners can also be arranged.

It is difficult for us to conduct internal control evaluations in-house.

We can support you by acting as an outsourced internal audit function or by performing only the evaluation procedures. Our team conducts objective and rigorous assessments, and where appropriate, we can also introduce solutions through trusted external partners.

What should we do if deficiencies are identified during the internal control assessment?

We analyze the root causes of the deficiencies and propose practical remediation measures that can be effectively implemented in your operations. We work closely with you to ensure that the issues are remediated by the reporting date.

We find it difficult to address IT General Controls (ITGC).

We provide clear guidance on IT-specific control areas—such as user access management and change management—without relying on overly technical terminology, helping you establish an effective control framework.

Is there a way to reduce the ongoing annual maintenance costs after listing?

By increasing process automation, it is often possible to reduce manual checks and sample testing, which can significantly lower long-term compliance costs.

Our current J-SOX implementation has become overly burdensome. Can you propose a risk-based approach to narrow the scope of evaluation?

Yes. By carefully assessing materiality and developing a defensible risk-based framework that can be discussed with external auditors, we help minimize the operational burden while still meeting regulatory requirements.

As SaaS adoption increases, can you advise on appropriate control design for IT General Controls (ITGC)?

Yes. We support the design of efficient and effective IT control frameworks that take into account the unique risks associated with cloud environments.

1.Initial Consultation / Inquiry

Please feel free to contact us via our inquiry form or by phone. A Certified Public Accountant will personally review your inquiry and respond promptly.
At this early stage, it is not necessary for the scope of work to be fully defined. We will first listen to the issues you are currently facing and the outline of your project, and help clarify how our firm may be able to support you.
All inquiries are handled in strict confidence in accordance with professional ethics, so you may proceed with complete peace of mind.

2.Meeting / Interview

To gain a deeper understanding of your company’s current situation and challenges, we will conduct a detailed discussion either in person or online.
In projects requiring a high level of expertise, it is essential not only to address visible issues but also to identify potential risks. While carefully confirming the scope of work, expected schedule, and your internal structure and policies, we will work with you to design the most appropriate support framework to strengthen your financial strategy.
Supporting documents may be requested where necessary.

3.Proposal / Fee Estimate

Based on the scope confirmed during the discussion, we will provide a detailed proposal clearly stating the professional fees and the basis for their calculation.
As an independent firm, we maintain a flexible and responsive fee structure while ensuring high-quality service. To avoid ambiguity or unexpected additional costs that may affect project budget management, we clearly explain the relationship between the services provided and the associated fees.
If necessary, the scope of work can be adjusted or implemented in phases to better align with your budget and needs.

4.Confirmation of Terms

Once the proposal is agreed upon, we will finalize the specific conditions for the engagement. This includes confirming details such as the frequency of reporting, timing of regular meetings, communication methods, and procedures for exchanging necessary documents.
Our goal is to ensure that you can entrust the engagement to us with confidence from commencement through completion. By establishing a structure that minimizes the burden on your team while allowing you to track progress accurately and in a timely manner, we build a cooperative framework based on clearly defined roles and responsibilities.

5.Contract Execution

After all terms have been finalized, we will formally execute the engagement agreement. The contract is prepared to appropriately manage legal risks while remaining fair and clear for our clients.
Upon execution, our support will formally begin under the legal and professional responsibilities of a Certified Public Accountant. We ensure a prompt and appropriate contracting process that can also withstand explanations required by audit firms or other stakeholders.

6.Commencement of Services

Following the execution of the agreement, we will promptly begin our work. In accordance with the agreed schedule, we will proceed carefully with research, analysis, and preparation of necessary documentation.
Throughout the engagement, we do more than simply perform assigned tasks. As professionals, we provide advice when appropriate and work alongside you as a partner to enhance the quality of management decisions.
Our commitment extends beyond delivering formal outputs. While maintaining professional independence, we aim to provide value that directly contributes to your company’s growth and the sustainable enhancement of corporate value.

Contact Us

For inquiries or consultations, please contact us via the Inquiry Form.

03-3484-0878

J-SOX Compliance Support Services