Market News
Oct. 12, 2017 TSE Public Announcement Measure and Request for Improvement Report: APIC YAMADA CORPORATION
TSE has taken the Public Announcement Measure and requested an Improvement Report as follows.
| １．Company Name | APIC YAMADA CORPORATION (Code: 6300, Market Division: 2nd Section) |
| ２．Date of Public Announcement Measure | Oct. 6, 2017 (Fri.) |
| Provision | Securities Listing Regulations, Rule 508, Paragraph 1, Item 1 (Due to disclosed information containing false statements and public announcement being deemed necessary) |
| ３．Improvement Report Submission Deadline | Oct. 23, 2017 (Mon.) |
| Provision | Securities Listing Regulations, Rule 502, Paragraph 1, Item 1 (Due to disclosed information containing false statements and improvements being deemed highly necessary) |
| ４．Reason | APIC YAMADA CORPORATION (hereinafter "the Company") disclosed an investigation report of the third-party committee concerning inappropriate accounting treatment by the Company on Jul. 3, 2017 and corrections to past earnings reports, etc. on Jul. 31, 2017. These disclosures revealed that even though some deliveries had yet to be completed, the Company conducted inappropriate accounting processing that brought profits forward by having customers sign off on acceptance documents, which was a mere formality, with a promise to complete the pending deliveries later based on an incorrect understanding that it was acceptable to record sales of transactions if the Company was able to obtain customer signatures that indicated the completion of receipt, inspection, and acceptance procedures. As a result, the Company was deemed to have disclosed earnings reports, etc. that contained falsehoods from the fiscal year ended Mar. 2012 through to the third quarter of the fiscal year ended Mar. 2017. This is a case where the Company did not fully share requirements for acceptance of goods within the Company, and some directors and employees of the Company interpreted the requirements for acceptance of goods arbitrarily. A director in charge of manufacturing unilaterally requested approval from the quality assurance department for a case that the department, which judges acceptance of goods, had once rejected due to the necessary procedures having yet to be completed. The quality assurance department heeded said director’s request and issued approval to the effect that the receipt, inspection, and acceptance procedures had been completed, which showed that the Company’s checking system did not function sufficiently. Also, some directors and employees of the Company were deemed to lack sufficient awareness of compliance given that in order to prevent inappropriate accounting processing from being detected by the Company's accounting auditor, a director instructed an outsourcing company to fabricate acceptance documents, and the President tolerated such inappropriate acts. Furthermore, while the Standing Audit and Supervisory Committee Member was aware of inappropriate irregularities, he did not take necessary and sufficient actions such as by reporting said irregularities appropriately or sharing information to or with Outside Audit and Supervisory Committee Members or the accounting auditor. Based on the above, this case is in violation of the listing rules due to the disclosure containing false statements, has considerable impact on investment decisions, and is deemed to require public announcement. Thus, TSE shall implement the public announcement measure. Furthermore, this is a case of inappropriate disclosure arising from deficiencies in the Company’s organizational structure for conducting appropriate timely disclosure, and improvements to the organizational structure are deemed to remain highly necessary. As such, TSE shall require the Company to submit a report containing the background of the issue and improvement measures. |
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