NEW YORK – Financial Services Minister Heizo Takenaka plans to create a panel to supervise auditing offices in an attempt to promote trustworthy corporate accounting, sources said Wednesday.
Takenaka will mention the plan during a meeting Thursday with William Donaldson, the chairman of the U.S. Securities and Exchange Commission, the sources said.
Under Takenaka’s plan, a nine-member panel will regularly assess the supervision by the Japanese Institute of Certified Public Accountants of its own member auditors. When necessary, the board will probe individual auditors and recommend that the Financial Services Agency take administrative action against them.
The supervisory panel will have a secretariat of around 100 members within the FSA. Takenaka hopes to launch it next April, the sources said.
The role of auditors has come under the spotlight recently. An accounting scandal at Enron Corp. of the United States last year helped convince Japanese auditors not to approve Resona Bank’s book-keeping this past spring, which forced the bank to ask for a government bailout.