Fraud Response and Prior Period Restatements
Fraud Investigation and Investigation Response Support

Swift and Evidence‑Based Support upon the Discovery of Accounting Fraud

01.Accounting fraud investigation

Accounting fraud in a company is a serious matter that significantly undermines social trust in the organization’s transparency and governance. Especially for listed companies or those preparing for listing, swift and precise response is required. In recent years, diverse and sophisticated fraud schemes have been observed, such as overstatement of sales due to pressure to achieve performance targets or management involvement, understatement of expenses, and manipulation of financial indicators through inappropriate accounting judgments. There are a growing number of cases that are difficult to detect through conventional internal or accounting audits alone.
Our team of certified public accountants and attorneys, each with extensive experience and a proven track record in accounting fraud matters, supports investigations into various types of accounting fraud and errors, serving as members or assistants of investigation committees.
Specifically, from a perspective well-versed in accounting standards, internal controls, and fraudulent accounting schemes, we formulate hypotheses regarding the fraud risks inherent within the company for each case and proceed with the investigation after designing the optimal investigation plan and a realistic schedule. Moreover, in the investigation, we conduct transaction-based analysis using various data such as journal entries, supporting documents, e-mails, and access logs. In addition, by verifying consistency with testimony from hearings and interviews, we clarify facts rooted in business practice and proceed with empirical and rational fraud investigations.

02.Support for responding to accounting fraud investigations(including coordination with audit firms)

When fraud or misconduct is discovered in a company, it is required to grasp accurate and objective facts and provide appropriate explanations to internal and external stakeholders within an extremely short period of time. Especially for listed companies, it is critical to file corrected reports within the deadline, secure audit firms’ opinion, and promptly restore trust with the Financial Services Agency, stock exchanges, and securities firms. If the policy for the initial response to fraud is misjudged, it can have a significant impact on the subsequent overall schedule and evaluation. In addition, since multiple internal and external parties (Board of Directors, Corporate Auditors, attorneys, audit firms, third-party committees, etc.) are involved concurrently in fraud investigations, both coordination skills and specialized expertise are required.
We possess high-level expertise in accounting and internal control, as well as an extensive track record in fraud response and investigation support. We are capable of providing consistent support—from the initial response to the case to investigation response, audit response, and submission of various disclosure documents, including retrospective prior-year corrections.
Moreover, we provide support for considering corrections to prior-year internal control reports following the discovery of accounting fraud, and support for various self-inspections that accompany the investigation results, as needed.