Market News
Mar. 31, 2022 TSE Cancellation of Designations as Securities on Alert and Securities Under Supervision (Examination): DAIICHI COMMODITIES CO.,LTD.
TSE has cancelled the designation of Security on Alert and Securities Under Supervision (Examination) as follows.
*This decision is based on the results of the examination by Japan Exchange Regulation.
| １．Issue Name | DAIICHI COMMODITIES CO.,LTD. stock (Code: 8746, Market Division: JASDAQ Standard) |
| ２．Date of Cancellation of Designation of Security on Alert | Apr. 1, 2022 (Fri.) |
| Provision | Securities Listing Regulations, Rule 501, Paragraph 7 (Due to falling under cases where the Exchange does not deem there to be any problem in the internal management system, etc. on the basis of the written confirmation of the internal management system resubmitted by the listed company) |
| ３．Date of Cancellation of Designation as Securities Under Supervision (Examination) | Apr. 1, 2022 (Fri.) |
| Provision | Securities Listing Regulations, Rule 601, Paragraph 1, Item (11)-2, Sub-item e (Due to the Exchange not deeming that the internal management system, etc. did not improve on the basis of the written confirmation of the internal management system resubmitted by the listed company) |
| ４．Reason | DAIICHI COMMODITIES CO.,LTD. (hereinafter "the Company") disclosed an investigation report of a third party committee on Apr. 30, 2020 concerning inappropriate accounting processing by the Company, and corrections to past earnings reports, etc. on May 1, 2020. Based on these disclosures, TSE deemed that improvement of the internal management system, etc. of the Company was highly necessary, and designated its stock as a Security on Alert on Jul. 11, 2020. Having checked sources such as the written confirmation of internal management system which was submitted by the Company after one year had elapsed since designation as a Security on Alert, TSE deemed that the Company had, to some extent, worked on the improvement plans the Company disclosed on Dec. 15, 2020, such as by strengthening awareness of compliance and developing the internal audit. However, TSE found that the following areas of the internal management system of the Company needed further work. As such, TSE deemed that it still needed to verify how the Company would make improvements in these areas in the future and decided to extend the stock's designation as a Security on Alert on Sep. 27, 2021, given that: -Although the Company states active deliberations at board of directors meetings as a measure to strengthen monitoring and supervision by directors, in cases of transactions involving conflicts of interest with directors or statutory auditors, there are not enough deliberations where directors and statutory auditors actively question each other. -The Company developed its internal rules and is working on implementing them thoroughly, but the internal rules have not been adequately implemented, as demonstrated by, for example, transactions identified to have been executed without having gone through the approval procedures specified in the internal rules. Now, having checked sources such as the written confirmation of internal management system which was resubmitted after one (1) year and six (6) months had elapsed since designation as a Security on Alert, TSE has deemed that the Company has responded to the points for which improvement was insufficient, including: -Concerning the approval process for related party transactions including those involving conflicts of interest with directors or statutory auditors, TSE has confirmed that the Company does not conduct transactions with related parties if it cannot confirm that they are rational or that their terms and conditions are appropriate. Specifically, such transactions are prohibited in principle, and if one is conducted as an exception, the Company has reweighted and reconstructed procedures, for example in that advice from the Compliance Committee is sought after the unit in charge has checked that the transactions meet the criteria set out in the rules. -The Company has made efforts to revitalize discussions and strengthen awareness of checks and balances at the board of directors by requiring each director to speak before a decision is made and clarifying in the internal rules that sufficient deliberations are required at board of directors meetings. -The Company is making efforts to promote a change in mindset among directors/statutory auditors and employees, as well as thoroughly implementing the new operations, by planning internal communication of the reconstructed approval process for related party transactions and monitoring the implementation status as a priority for the internal audit. Besides the above, TSE also deems that the Company has established an appropriate internal management system and is operating it accordingly. As such, TSE has decided to cancel the designation of the stock of the Company as a Security on Alert since it does not deem there to be any problem in the internal management system, etc. of the Company. Together with this decision, it will cancel the stock's designation as a Security Under Supervision (Examination). |
Current Designations of Securities on Alert
Designation History of Designation of Securities on Alert
Designation History of Designation of Securities on Alert
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