Mazda initiated a system of self-diagnosis of internal controls in 1998, and this is currently carried out at all consolidated Mazda Group companies in Japan and around the world.
Departments primarily responsible for internal controls cooperate with other related departments to provide training and support, working to promote internal controls to ensure that operations proceed smoothly in all departments and consolidated Mazda Group companies.
Mazda also has in place its own framework of internal controls conforming to the COSO Report*1, a global framework for internal controls, and the implementation standards of J-SOX. This framework helps to ensure the validity of financial reports, the promotion of compliance, the improvement of operational efficiency, and the maintenance of corporate assets.
- *1Report outlining a comprehensive framework for internal controls, released by the US organization, Committee of Sponsoring Organizations of the Treadway Commission (COSO)
This system confirms the control activities for avoidance and mitigation to be taken for every foreseeable risk in the operation. It is systemized while providing a mechanism where aggregation and analysis can be conducted without overburdening the workplace.
The Global Auditing Department supports not only the Mazda Group Companies but also the local suppliers in Hiroshima Prefecture and neighboring regions in implementing the self-examination system, etc., in order to enhance internal controls throughout the entire supply chain, as well as to make contributions to the local community.
Mazda introduced the signoff system in FY March 2007. The general manager of each department, and head of each company in the Mazda Group ensure internal controls by "signing-off," after addressing all business issues indicated by auditors, or discovered through self-examination. The contents of the Mazda Internal Controls Report are guaranteed by the accumulation of these signoffs.
Located at the Mazda Head Office, the Global Auditing Department conducts internal audits to ensure that the Company's management targets, policies, and plans comply with all applicable laws and regulations, in order to uphold the Company's sound and efficient management practices. In addition, in overseas Mazda Group companies in North America, Europe, Australia, and major operational centers in South America, the Mazda Group has established internal auditing departments that are fully independent from the operating departments. These departments work closely with the Global Auditing Department to conduct a full range of auditing tasks, including the evaluation of internal controls. Among Mazda Group companies in Japan, dedicated internal auditing departments are also established at major dealerships, where they are chiefly engaged in the auditing of sales outlets.
These internal auditing departments are staffed with many auditing professionals of the highest caliber, bearing qualifications such as Certified Internal Auditor (CIA) and Certified Information System Auditor (CISA). The Company is also actively engaged in training the next generation of highquality auditors. As of March 31, 2012, eight internal auditors in Mazda itself and eight in overseas consolidated Mazda Group companies hold qualifications.
I am in charge of supporting overseas group companies in establishing auditing structures and improving the quality of their auditing.
To be a reliable assistant for the Group companies' managers and staff in charge of auditing, I try to keep in close communication with them. Also through meetings of the quality of Audit Committee Meeting involving the management team, we conduct evaluations and monitoring to understand each Group company's current status, challenges, and expectations for the Global Auditing Department.
Mazda has in place dedicated and publicly certified system auditors who conduct auditing of the current condition and operational status of the various IT system controls of its Head Office and consolidated Group companies in order to reduce IT risks.
In addition to the Internal Controls Signoff System introduced in 2006, Mazda has been implementing a new system since FY March 2010 whereby all discovered or indicated inadequacies of each business area/Group company are fully reported to the Global Auditing Department. Deadlines and responsible personnel are assigned to each of these inadequacies for prompt improvement.
