KPMG JapanOTEMACHI FINANCIAL CITY South Tower
1-9-7 Otemachi, Chiyoda-ku,
Tokyo 100-8172
TEL: +81-3-3266-7562

kpmg.com/jp

KPMG Japan Our Story 2018 / 19

Contact us

KPMG Japan
Our Story
2018/19
KPMG Japankpmg.com/jp/socialmedia

The information contained herein is of a general nature and is not intended to address the circumstances of any particular
individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that suchinformation is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act onsuch information without appropriate professional advice after a thorough examination of the particular situation.
© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law
and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative(“KPMGInternational”), a Swiss entity. All rights reserved. Printed in Japan. 19-5006© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG
network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.
All rights reserved.
The KPMG name and logo are registered trademarks or trademarks of KPMG International.

kpmg.com/jp

Index Map

KPMG Ignition Tokyo Technology Center Entrance© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

01

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Index Map

Management Message
CEO Hiroyuki SAKAI / Chairman Toshiya MORI

Sources of our Value
Demonstrating our collective strength / History of Diversity

KPMG Ignition Tokyo

03
05
09
11
15
17

Our Purpose

Value Creation Story

Our Vision and Strategy

27

Governance Structure / Management Committee Members

29

Service Lines

33

Solutions to social challenges / Citizenship35

Three-year Performance /Overview of Group Companies

Online Report(Japanese only)© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

02

Our Purpose

Our Purpose

Inspire Confidence,
Empower Change.

We work to inspire confidence in the economy while empowering clients andsociety to make positive changes. This is Our Purpose.
We work shoulder-to-shoulder with our clients, delivering real results, while weourselves change for the better as we seek to be the Clear Choice.
This is The KPMG Story – building on the past and leading into the future.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

03

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

04

Management Message

CEO Message
To be The Clear Choice – Now and in the Future
The vision of KPMG Japan is to become The Clear Choice.
To achieve this goal, we provide credibility to financial information
through our audits as a “gatekeeper” of the capital markets, andthrough our tax services offer appropriate and comprehensive
advice to address complex, cross-border tax issues. Through ouradvisory services, we are committed to supporting clients toenhance corporate value at all stages of the enterprise’s activities
including business transformation and improvement in operations
on a global scale. As CEO of KPMG Japan, it is my mission tocontinue to “Inspire Confidence” by fulfilling our social
responsibility and transmitting our knowledge and capabilities to thenext generation, thereby establishing the foundation for KPMG
Japan to be The Clear Choice now and in the future.

Digital and Diversity are critical to realizing Our Vision
Digital and Diversity are the keywords for achieving Our Vision.
Whether it is continuously improving our audit quality, supporting theestablishment of global tax strategies and tax governance structures,
or offering sophisticated advisory services that consider theopportunities and risks for future corporate value, we must use cuttingedge digital technologies combined with our specialized knowledge
and expertise that we have cultivated in each of these areas.
KPMG Ignition Tokyo, which we launched in July 2018, is a hub for
combining the knowledge of our professionals and digital experts
with the latest digital technologies and promoting KPMG Japan’s
integrated digitalization. It will play a role as a state-of-the-art hub
for providing Japanese clients support on their digital transformation
journey and creating solutions for succeeding amidst global
competition. In a rapidly changing, complex business environment,
it is necessary to encourage the diversity of our teams in order toperform an in-depth audit and to respond to various needs in the
tax and advisory areas. We are currently promoting work stylereform using three frameworks – Operational (a “back to basics”
approach to our work), Institutional (improving the working
environment) and Cultural (promoting behavioral change) – so thatour people with diverse talents are motivated, demonstrate their fullcapabilities, and succeed in the workplace. We aim to become anorganization with diverse competencies and diverse values so that
we are able to respond quickly with innovative solutions to theneeds of a society that is undergoing changes associated withdigitalization and globalization.

Realizing Our Growth Story Together
Our Vision is to inspire confidence in a rapidly changing and complex
economy while empowering clients and society to make positivechanges amidst a challenging business environment. In so doing, wemust be committed to transforming ourselves and constantly
evolving our firm to meet the expectations of society. I am
determined to work together with clients, society and all otherstakeholders in order to realize Our Vision, to be The Clear Choice.

What we want you to know

We aim to be The Clear
Choice for our clients,society, and all otherstakeholders. We believe wecan achieve this if we areconsistently trusted by ourclients and society at large.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

05

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

KPMG Ignition Tokyo Technology Center

To be The Clear Choice –Now and in the Future
Hiroyuki SAKAICEO, KPMG Japan
Managing Partner, KPMG AZSA LLC© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

06

Management Message

Chairman Message

To be a firm that leads change
in an increasingly digital society andis trusted by and growing together withour clients, our people and society.
Toshiya MORI
Chairman, KPMG JapanWork
Experience

Toshiya served as Head of Advisory of KPMG
Japan since 2015 and assumed his current role in
October 2018. He has extensive experience
providing both audit and advisory services toassist global corporations with a wide range ofmanagement issues.
KPMG Ignition Tokyo Innovation Laboratory© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

07

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Becoming The Clear Choice
KPMG Japan consists of seven main
professional firms that are supported
by nearly 8,300 people. KPMG’s global
network of independent firms offer
audit, tax and advisory services andoperate in more than 150 countries
with almost 200,000 people ofdifferent nationality, gender,
generation, background and expertise.
To achieve Our Purpose – Inspire
Confidence, Empower Change – KPMG
is committed to contributing to clientsand society through robust relationships
and a network built on the high degreeof professionalism of each individual,
mutual acceptance and respect foreach other.

Leading innovation in a digitalsociety
Development of innovativetechnologies is promoting competitionand cooperation across different
industries through open innovation,
the influence of which is spreading
beyond business to individual lifestyles
and even social structure. Many ofthese technologies are brought about

by “digitalization” including thecollection, processing and analysis ofhuge volumes of data. This has
resulted in a situation wherebusinesses that control data enjoy anoligopolistic position in the market,
with regulations to correct this being
strengthened in response. In short,data will continue being at the heart ofinnovation going forward. This macro
trend affects both what it means to bea professional as well as our services.
In order to lead the changes impacting
clients and society and to prepare forthe next generation, we are proactively
investing in digital and innovation,
beginning with the launch of KPMG
Ignition Tokyo, and strengthening thedevelopment of talent.

Our responsibility to the next
generation – Sharing challenges andgrowing together with the client
In order to respond to society’s
expectations at a time when theissues and challenges faced by clientsand society are increasingly complex
and changing rapidly, we are required
to maintain a fairness of mind. Thismeans that we are not swayed by thetrends of the day and do not simply
accommodate ourselves to thedemands of clients, but remain
steadfast in our beliefs whennecessary.
It is my mission as the Chairman of
KPMG Japan to foster our talent tohave not only a high degree ofexpertise and insights but also a highstandard of fairness, so that our firm
can grow into a team of professionals
capable of earning the trust of society
in the long term.
Through our audit, tax and advisory
services, we act variously as amarket watchdog and an advisor,
supporting our clients and society totackle the issues they face andultimately build trust. KPMG has
committed to the Sustainable
Development Goals (SDGs) on a
global basis, and KPMG Japan will
do its part to proactively promoterelevant activities. By fostering aculture and environment where wecan make the most of our strengths,
we aim to be a professional firm that
contributes through high quality
services and deep expertise, growing
together with our clients and society.

Our Purpose
Our Values
Our Vision
Our Strategy
Our Promise
Our Purpose

Our Values

Timeless (universal)
Enduring guideposts
and code of conduct

Our Vision

Our Strategy

Our Promise

Timely (5-10 years)
What we aim to be and how we will get there
in the ever-changing economy and society© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

08

Value Creation Story

Value Creation Story
Our ability to support clients in solving challenging issues and the diverse expertise of our people
contribute to society by assisting our clients to create value, enabling KPMG to create our own value in turn.
The insights gained from this contribution result in a stronger foundation for our business whichallows us to enhance our capabilities to solve ever more complex issues. Through this process
we can achieve sustainable growth and fulfill the role expected of us by our clients and society.

Value Creation
With the goal of assisting clients’ value creation, we use all the
resources at our disposal to solve issues for clients.

Input
We utilize our accumulated credibility, expertise,and global network.
Sources of our value
Accumulated trust
Professionals with integrity and expertise who meet the
expectations of society
Global network to make the most of our insight

At a Glance(As of June 30, 2018 unless otherwise stated)

Number of
employees

8,309

Number of global
professionals*2

Number of Certified
Public Accountants

3,359

Global Network

Number of
Certified Public
Tax Accountants*1

Revenues

245
1,449

hundredmillion yen

2,965
154
197,263

Countries

Percentage of female
employees

Number of female
partners

Number of
employees

Percentage of
non-Japanese

2.6%
32

Number ofnationalities

30.9%

Percentage of
employees with adisability*3

46

Number of
employees taking
maternity or childcare leave

2.37%
Female157 Male 6*1 Certified Public Tax Accountants both registered and non-registered (including those who have passed the examination and those who are exempted from examination) who are engaged in tax services.
*2 Global professionals are those who have overseas work experience, those who have completed global skills training courses, and foreign nationals.
*3 Total percentage of persons with disabilities who are employed by KPMG AZSA LLC, the parent company of a special subsidiary, AZSA Office Mate Co., Ltd., and KPMG Consulting Co., Ltd.
© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

09

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

The Clear Choice
We deliver ever-higher quality service for society andindividuals by utilizing the outputs we accomplished throughassisting clients to create value.

KPMG-

Quality

Ignition
KPMG-

Cube

KPMG-

CareerOutputWe realize outcomes by providing high quality services.

Outcome
We contribute to building public trust and to enhancing
value by fulfilling the responsibilities entrusted to us.
Our contribution to society
Achieving a transparent, fair economy
Building trust as a foundation of society
Our value creation
Professionals who can make judgments based on insightful
thinking to solve complex issues
Ability to leverage diversity to consistently bring about
desired outcomes

3,558

Number of audit clients

Share of audit market

Share of top 100 listedcompanies by market cap

No.1 (Share: 36.0%)

Share of top 100 listedcompanies by revenue

No.1 (Share: 40.0%)

Share of 194 Japanesecompanies reporting
under IFRS (orplanning to)No.1 (Share: 30.4%)

Share of 12 SEC
registrants in Japan

No.2 (Share: 25.0%)

No.1

Tax firm ranking*4

M&A advisory ranking(January 1, 2017 – December 1, 2018)
Source: Thomson Reuters

Global People Survey 2017
results*5

5
Based on In-Out deals No.3

Based on publicly announced deals No.

Quality & Risk

72(±0 from theprevious quarter)

Inclusion & Diversity

65(+2 from theprevious quarter)

Innovation60(+6 from theprevious quarter)*4 Industry magazine International Tax Review named KPMG Japan the “Japan Tax Firm of the Year” for the Asia Tax Awards for two consecutive years.
*5 Global People Survey (GPS) is an awareness survey conducted on a regular basis for all people who work for KPMG member firms worldwide, as part of the firm’s ongoing improvement initiatives.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

10

Sources of our value -Demonstrating our collective strength-

KPMG AZSA
Honda Global Audit Team (SEC audit team)
from
left

KPMG Canada, Toronto Office, Partner

Dave POWER
Partner

Masahiro MORITA
Partner

Hiroyuki YAMADAKPMG Canada, Toronto Office, Partner

Frank KLEMENCHUKKPMG Canada, Toronto Office, Senior Manager

Ilario MELIA

Our audit team consists of over 200 people at KPMG
member firms in 13 countries worldwide. While there
are sometimes debate and differences of opinion, we
trust each other and always think about what is bestfor our client and society. Teamwork in the continuous
pursuit of high value-added audit is our strength.

We offer high value-added audit services to clients
operating a global business. Team members around theworld demonstrate our collective strength by collaborating
as one team in order to meet the expectations of society.

The strengths that form the foundationfor our Value Creation Story
Professionals who have diverse expertise and knowledge collaborate to solve thechallenges and disruption faced by clients and society. Utilizing our global network,
they demonstrate the collective strength of our firm in order to meet expectations.

Input

KPMG Tax Corporation
Recruit Holdings Global Tax Governance Team
from
left

ASGT Manager
FinTech Senior Manager
FinTech Partner

Mamiko KIMURA
Jun ITO
Kazushige KOIDE

The client is undergoing rapid globalization through M&A in order to achieve its
goal of “being the Global No. 1 firm in the HR industry by 2020.” The KPMG JapanTax team clarified the client’s tax position related to complex and sophisticatedcompliance issues, by utilizing the KPMG network and technology to build a global
tax governance structure, address BEPS, establish a transfer pricing policy, andoffer corporate tax compliance services on a global basis.

We support the development of tax compliance for globalized
Japanese companies by providing tax services that make fulluse of the latest knowledge and experience related toincreasingly complex taxation systems.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

11

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

KPMG FAS
Cross-functional PMI team
from
left

KPMG Tax Corporation, M&A /Global Solutions, Partner
KPMG FAS, T&R, Partner
KPMG AZSA, AAS Division, Manager

Toshiya MIWA
Tsuneo MIYAMOTO
Reiko KOMIYAMA

We built a team of experts with deep insight in the energy sector to support ourclients as they compete in the global energy market by building a new energy
business model resulting from the integration of two leading power companies’
fuel and coal power business supply chains.

Our cross-functional team contributes to society bysupporting our clients’ integration through extensive
knowledge of the energy sector.

KPMG AZSAOsaka Office Division 3 Nankai Electric Railway Audit team
from
left

PartnerManager
Assistant Manager

Keiko KITAMURA
Shinya YAMAMOTO
Eriko HAMADA

The client’s railway and urban development businesses are important social
infrastructure in the Kansai area, where cities have seen remarkable growth
as tourist destinations. We are striving to build trusted relationships and to bea good partner for the client through our audit services by both sharing ourclient’s perspective while firmly maintaining our fair-mindedness.

We contribute to the sustainable growth of our client andsocial infrastructure through our audit services.

KPMG Consulting
Business Transformation
from
left

Manager
Consultant
Manager
Director

Yosuke KUMURA
Hikaru MATSUKA
Yohei MAEKAWA
Dai NAGASHIMA

Our strength lies in our universal capacity for problem solving and our diverse
background and expertise. By making the most of these strengths and seeking thelatest technology and solutions, we support the client to solve problems andundergo transformation in an increasingly diverse and complex digital society. Our
mission is a rewarding one – to be the best business transformation partner for ourclient by sharing the same goal, tackling the challenges together, and breathing life
into the client’s reforms.

Team members with diverse expertise support theclient’s business transformation through problem-solving
capabilities and cutting-edge technologies.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

12

Sources of our Value -History of diversity-

The diversity
supporting our
Value Creation Story
Today’s KPMG Japan is the result of a series ofmergers and reorganizations. Our firm’s history is
one of accepting different cultures and valuing
diversity, and it is this culture of mutual respect
which has been the cornerstone of KPMG Japan.

y

Input

r

ne

KPMG AZSAKPMG AZSA, FS Audit Division 3, Partner

Hatsumi FUJIWARA

Although balancing work and parenting
commitments requires constant flexibility andadjustment, I have the support and understandingof my audit and advisory colleagues around me.
I would like to show my junior colleagues that fewer
working hours does not translate to a slowdown ofcareer progression.

Our Jou

Details of Our Journey are available on KPMG Japan’s
website from the QR code above.

“Respect and support one another”- this embodies KPMG.

We chose KPMG because of the workplace openness that we
experienced during a recruiting visit. This feeling has not fadedeven after joining the firm, and opportunities to demonstrate
one’s abilities are open to everyone, including junior workers.

“Openness” - this is the reason we chose KPMG.
SAWADASUGIYAMASUGIHARASONODAA deciding factor for me was how welcoming andopen-minded the recruitment officer was - I could
easily picture KPMG having a culture which values
each and every person. Also, I would like toparticipate in cross-border engagements and havethe opportunity to work abroad in the future.
People at KPMG are committed, confident, andwork with pride - this is the reason why I wanted tojoin the firm. I find my job rewarding, even whenchipping away at tasks that at times seem minor
during large-scale projects, but I still feel that I am
always helping the team to succeed. Also, I would
like to help Japanese and overseas companies build
long-lasting relationships with each other in the areaof international tax.
Working cross-functionally with domestic andoverseas members to provide the best solutions tocomplicated and diverse client issues is challenging,but it’s both fun and fulfilling being a member of theteam while working towards a common goal.
By taking on the many opportunities available to me,
I can feel myself growing professionally together
with the firm. We are using the latest technologies
to develop targeted solutions for our clients, andworking to deploy such solutions overseas. Tacklinga question with no obvious answer – how to create
something from nothing? – this brings me
satisfaction.

Millennial Generation
from
left

Taro SAWADA
KPMG Tax Corporation, FinTech, Staff
Hayami SUGIYAMAKPMG FAS, Corporate Finance, Senior Takami SUGIHARA
KPMG Consulting, AIT, Consultant
Reo SONODA
KPMG AZSA, AAS Division, Senior(Joined in 2017)(Joined in 2018)(Joined in 2013)(Joined in 2016)© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

13

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

KPMG Alumnus
WARC Inc. Director
Akatsuki Inc. Corporate Auditor
App Land, Inc. Outside Director

Mr. Kazuhiro ISHIKURAThe experience serving both major
corporations as well as venturecompanies during my tenure at KPMG
AZSA gave me valuable insight into avariety of business models. I not only
learned about the operations of myclients, but also learned a lot about how acompany works and what motivates
workers. This exposure to organizationalmodel cases for managing a company
has greatly influenced the way I think.
Now I have many opportunities to workwith KPMG as a client. The views of anauditor or advisor can have a great
impact on their clients, so I look forward
to receiving valuable advice from andgrowing together with KPMG as animportant business partner.

Multinational background
KPMG FAS, RS Professional Junior
Associate

from
left

KPMG Consulting, StartUps,
Professional Business Analyst
KPMG AZSA, FS Advisory,
Assistant Manager

Vivian LEE
Harryhiro TAKAHASHI
Andrew BARGER

KPMG professionals of various nationalities and disciplines work shoulder-to-shoulder toprovide value-added services to our clients.

My experience at KPMG is thefoundation of my career today.

KPMG supports motivated individuals regardless of differences suchas nationality or gender.
At KPMG we are given opportunities to grow through close collaboration withprofessionals across the KPMG global network. In addition, KPMG has an open culture
where we can express ourselves freely regardless of nationality, gender or age.
TAKAHASHI KPMG offers a friendly working environment that allows people to speak up regardlessof their job title and enables junior workers to take on challenging engagements in aproactive manner. It is gratifying to be chosen by clients due to the diligent and sincere
attitude we have towards our work.
BARGER
The opportunity to work with industry leaders on cutting-edge projects is bothchallenging and extremely rewarding. A broad client base which includes not only major
Japanese financial institutions but also foreign financial institutions enables me to build
strong cross-border industry expertise as well as develop strong relationships with ourmember firms, which are critical in the current and future business environment.
LEE

Mr. Ishikura worked on the audits of global companies
while at KPMG AZSA from 2005 to 2012. He took up his
current role after various positions including as CFO of
3Minute inc. He is also an angel investor who funds
startups.

AZSA Office Mate
from
left

Staff

Masatsugu ITO
Yuki IWATA
Mirai KUNITOMO
Takashi MIYAWAKI

We are proud to support daily business operations as members of KPMG. KPMG
offers an environment where we can always take on new challenges, which we
believe is one of the firm’s main strengths.

KPMG believes in and supports our potential.
ITO

IWATA
KUNITOMOMIYAWAKI

I always perform my responsibilities with purpose and mindfulness. While
helping junior colleagues to learn and progress, I would also like to take on
new challenges myself.
I follow through on each task until completion and enjoy working as part of a
dedicated team.
I have always enjoyed working at KPMG, but I am especially satisfied when
I am recognized for my efforts on the job.
I can take advantage of my passions at KPMG and work with conviction.
Supporting others at work is the most rewarding part of my job.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

14

Our Vision and Strategy

VisionThe Clear Choice
To be the Clear Choice – Now and in the Future
We work shoulder-to-shoulder with our clients, delivering real results, while weourselves change for the better as we seek to be the Clear Choice.

KPMG-

Quality
Ensure steadfast quality
Maintain a high standard of expertiseand provide valuable insight
Utilize advanced, innovativetechnology

Ignition
KPMG-

KPMG-

Cube

CareerDemonstrate our collective strength

Promote professional growth

Promote market-oriented culture

Develop professionals who
excel in the market

Deliver seamlessly integrated
solutions

Be confident and proud of ourpeople and our work

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

15

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Mid-term Management Plan
Accelerate strategy execution via KPMG Ignition Tokyo
In 2016, we developed a mid-term management planfor the four years ending 2020 with the objective of
having KPMG become the Clear Choice for our clients,
our people and the public, and we have been steadily
implementing measures in line with this plan.
KPMG Ignition Tokyo will accelerate the execution of
our three strategic pillars – Quality, Career, Cube – andtheir respective concrete strategies. We aredeveloping and implementing various cross-functional
initiatives to achieve a unified “One KPMG” firm.
By strengthening our ability to grasp the complex,
rapidly-changing challenges faced by our clients andsociety, we can provide the appropriate support andcontribute to society.

Strategy for realizing Our Vision

Quality

CareerCube

Quality Strategy

People Strategy

Organizational strategy

Ensure steadfast quality

Promote professional growth

Demonstrate our collective strength

As an accounting firm, we constantly
endeavor to provide quality to ourclients by seeking an increase in value
for both society and for our clients.

KPMG Japan’s strength lies not just in our
specialized knowledge or use of advanced
technologies - we face the challenges ofbusiness and society with sincerity andpurpose while providing an environment where
each individual can grow as a professional.

We merge cutting-edge technology
with our professional insights andmethodologies thereby demonstrating ourcollective strength and delivering solutions
to our clients’ challenges through the
KPMG global network.

P19

P21

P23

Ignition
Creating value
We are strengthening the digital aspectof our Quality, Career and Cube strategicpillars to ensure their successful
execution here at KPMG Japan.

P17

KPMG Ignition Tokyo connects KPMG Japan’s
three strategic pillars – Quality, Career, and Cube – todrive the evolution of KPMG Japan and allow us tofurther support the transformation and innovation
agenda of our clients.
Introducing technologies to audit, tax andadvisory services, KPMG Ignition Tokyo connects
KPMG Japan seamlessly to the KPMG global
network in order to deliver solutions to thecomplex, rapidly-changing issues of our clientsand society as “One KPMG.”© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

16

KPMG Ignition Tokyo

Innovation LabsThe Innovation Lab is a creative discussion
space to spark open innovation. It provides
companies with the stimulation they needto generate new ideas and promotes
discussion of innovative business models
through workshops.

KPMG’s initiatives
in the digital space
KPMG Japan
Chief Digital Officer (CDO)

Hitoshi AKIMOTO

Discussion of business today necessarily includes a couple keywords – disruption,
innovation, agility and transformation. It is no exaggeration to say that these words
sum up the world we live in today. However, there is often a gap between people
who talk about these concepts and people who make them a reality.
KPMG Ignition Tokyo is a hub where KPMG promotes its own transformation while
supporting our clients’ transformation. When we discuss the digital journey withclients here, we can provide them with not only professional knowledge but ouractual experience. We believe that these discussions are a unique advantage thatdifferentiate us.
Though our audit, tax and advisory services are all dependent on our people, weare confident that we can achieve Our Vision by embedding technology ineverything we do.
© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

17

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Insights Center
The Insights Center brings together
knowledge from the KPMG global network
to provide demonstrations of what digitaltransformation is capable of, giving clientsan opportunity to experience first-hand adigital future.

State-of-the-art Hub for promoting client innovation
KPMG Ignition Tokyo is a hub for combining our accumulated
professional insights in audit, tax and advisory with theknowledge of our digital experts and the latest digitaltechnology. Through this hub, we promote the digitalizationof our own services as well as the digital transformation of
our clients by developing solutions necessary to succeed
in an increasingly competitive global landscape.
The KPMG network currently has “KPMG Ignition”
branded facilities in 19 major cities around theworld including Tokyo, New York, London,Frankfurt, Sydney, Singapore, Hong Kong, andBangalore, with plans to open new facilities
in four more cities in the near future.

KPMG is the only Big Four global
accounting firm to be named a leader
by IDC in the US-based market
research firm’s IDC Market Scapereport under the category, “Worldwide
Digital Transformation Consulting and
Systems Integration Services 2017
Vendor Assessment.”

The Technology Center is an internal
working space for R&D in coretechnologies that are necessary to theclient’s digital transformation journey aswell as various other applications
developed from the client’s perspective.

Technology Center© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

18

KPMG-Quality

Quality
Ensuring steadfast quality

Message from the Head of Audit
KPMG Japan is at its core an audit firm and a tax accounting
firm. The audit firm is committed to the sound developmentof the economy by ensuring the reliability of financial
information, while the tax accounting firm’s mission is tohelp clients fulfill appropriate tax obligations. As an
accounting firm that bears this social responsibility, KPMG
Japan strives for ever higher quality in all of our services
including advisory. In this way we contribute to increasing
value both for society and for our clients.
We have always made judgments based on criteria andethics that are recognized by society as fair and reasonable,
while maintaining a high degree of expertise and integrity andcomplying with a strict set of rules. We have also ensured the

independence of our audit services and have maintained andenhanced the quality of all services that we provide.
We believe that the use of advanced technology is essential
to continuously meet the expectations of society and ensure
a high level of quality in our services on an ongoing basis.
We are working on initiatives related to the use of technology
to improve quality in each of our audit, tax and advisory
functions, with KPMG Ignition Tokyo at the center. These
initiatives, some of which require advanced data analysis
techniques, leverage IT and specialized expertise. We
believe our passion for and commitment to quality willcontribute to the robust future growth of clients andsustainable development of society.

Audit Quality
Audit quality is the source of public trust in KPMG AZSAAt KPMG AZSA, we regard maintaining audit quality as our
top priority. We relentlessly seek to enhance audit quality inorder to meet the expectations of society. Audit teams
provide high quality audit services that are responsive toadvances in information systems, globalization and otherchallenges faced by Japanese companies.
Inclusive corporate culture to encourage free, robust
discussions
We routinely reassign our people to different positions andhave reorganized our corporate structure so as to provide
consistent quality of audit services and improve global
responsiveness. As a result, we have cultivated an open
corporate culture that welcomes free discussion andencourages learning from one another. Such values areshared by each and every one of us, making for a wellintegrated organization.
Governance system to facilitate execution of effective
management
To enhance the effectiveness of our firm’s management
function, we have separated bodies responsible formanagement from bodies responsible for supervision andevaluation. In addition, we established a Public Interest
Committee with a majority of outside members as anindependent supervisory body, thereby ensuring the firm ismanaged with a view to the public interest. We are actively
promoting further initiatives to ensure transparency, suchas publishing AZSA Quality and organizing stakeholder
dialogue events.
Four Defense Lines to help disseminate management policies
In order to provide audit quality that fulfills the expectationsof society and clients, we have defined Four Defense Lines,
namely: (1) firm management (KPMG AZSA Managing
Partner and Senior Executive Board Members), (2) quality
control departments, (3) audit divisions and (4) audit teams.
This structure ensures the operational effectiveness of theentire firm by disseminating management policies down tothe audit teams and conveying
and sharing information fromeach audit team withmanagement.

KPMG AZSA periodically issues a report
AZSA Quality to explain ourmanagement’s thoughts on enhancing
audit quality and other initiatives so that
our stakeholders, including participants inthe capital markets, can better understandus, and what we can do for them.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

19

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

KPMG-

Quality

Ignition
KPMG-

Cube

KPMG-

CareerTakuji KANAIHead of Audit

Tax Quality
Tax issues are becoming more diverse in today’s increasingly
complex and international business environment. Addressing
the various aspects of corporate management, which isundergoing dramatic change in recent years, KPMG Tax
Corporation’s teams of tax specialists, each of which has afield of expertise, offer high quality services to clients.
To develop such specialists, KPMG Tax Corporation provides
training programs to further enhance tax-related technicalskills and to strengthen client focus and communication

skills, based on our determination to be The Clear Choice forclients.
In addition to tax consulting, KPMG Tax Corporation aims toprovide high quality compliance services including
preparation of tax returns. KPMG does not merely perform
clerical work in preparing tax returns. We engage in in-depth
dialogues with clients to identify potential tax-related risks,
and tax planning options, with the ultimate aim of raisingclients’ corporate value.

Advisory Quality
We have built trusted relationships with our clients based on
our client-focused attitude, technological knowledge andinsights, and continuous delivery of value through globallyconsistent services. This has allowed KPMG Japan to earn areputation for quality.
Commitment to enhancing clients’ corporate value
KPMG Japan has established an operational approach that
ensures the delivery of high value-added services
appropriate to the client’s characteristics and the size andcomplexity of the service. We maintain a database of ourpeople’s skills and experience which we use to ensure ourteams consist of professionals with the relevant expertiseand experience. For engagements of a certain scale, theappointment of a quality control review partner is required,and for complex and sophisticated services an engagement
leader is assigned based on the firm’s accreditation system,
KPMG’s internal certification.
To be a trusted partner who works shoulder-to-shoulder
with clients and listens to feedback from the front line, ourprofessionals ask themselves: “Am I contributing to value
creation for my clients? What is necessary for the client togrow continuously in the mid- and long-term?” By
constantly asking these questions, we ensure that ourpeople are committed to providing high quality services.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

20

KPMG-Career

CareerDeveloping professional talent
Message from the Head of People, Performance and Culture
To achieve KPMG Japan’s vision of being The Clear Choice,
we require diverse professionals with excellent capabilities
who our stakeholders can trust.
We believe that we can improve the competitiveness of theorganization through individual growth – hiring and developing
outstanding talent and implementing work style reform.
In addition, to raise productivity and service quality, wemust improve the satisfaction of individuals working in ourorganization. If each of us is highly motivated, we canachieve individual growth at the time as improving thequality of the services our organization provides, ultimately
providing our stakeholders with higher satisfaction. This willlead to the achievement of Our Vision.
We are continuously reviewing our operations and utilizing
the latest technology to develop tools and new services
while striving to foster talent to keep up with thesechanges. KPMG Ignition Tokyo includes numerous
professionals who have experience with advanced digitaltechnology and methodologies, thus providing a career
path for multi-disciplinary professionals.

The work style needs of our people are also evolving andadapting to changes in the environment, which ischaracterized by a shrinking labor force, demographic
changes, increasing need for workers to provide elderly andchild care, and a diversification in lifestyles and values.
KPMG Japan has established a comfortable working
environment that allows all of our professionals to perform
while maintaining good physical and mental health.
The right corporate culture is essential for a diverse group ofpeople to successfully work together toward a common
goal, including elements such as mindset, behavior, businesscustoms and acceptance of diversity. KPMG Japan further
conducts initiatives on an ongoing basis to raise awarenessamong our people including on topics such as what it means
to be a true professional, productivity and communication.
In order to foster professional talent and achieve Our Vision,
we must continuously implement a variety of initiatives androll them out across all KPMG Japan group companies.
Furthermore, we believe the long term commitment of top
management to these efforts is vital.

Audit Career

t
en

Se
lf
AZ
SA
’
OJ
T

n)
tio

Human Resource Development Principles and the “Three O’s”
KPMG AZSA has established basic principles for thesystematic creation and maintenance of an environment thatenables personnel to acquire the expertise and skills
necessary to provide high quality services, thereby fostering
the development of true professionals. At KPMG AZSA, true
professionals are developed through the “Three O’s,”
namely: OJT (on-theM
Grow th indset (job training), Off-JT
Fo
and
un
y
ource De
d
da
n Res
vel
tu
a
s
(off-the-job training;
m
op
u
m
sH
practical andpragmatic training),
True Professionals
Opportunities
Professional Base(providing a wide
Expertise
range of work
Skillsopportunities).
KPMG

iples
inc
Pr
T
f-J
Of

Opp

or t u nit y

Fostering a growth mindset and effective engagement
conduct among audit teams through OJTThe pillars of the OJT basic policy are (1) engagement conductthat enables the active and appropriate communication withclients that is necessary to identify and solve issues, and (2)audit work paper review, discussion, and feedback for training
purposes. We believe that fostering a talent development
mindset in our people is essential to achieve these goals.
Effective human resource development through the PDCA
cycle in OJT
We hold team management discussions to provide aregular opportunity to think about the optimal approach toengagement conduct. We also continuously review ourinitiatives for human resource development through thesharing of best practices and by obtaining feedback fromthe audit front line. By going through this PDCA (plan-docheck-act) cycle as a part of OJT, we are able to foster
talent more effectively.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

21

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Careers in Tax
Hiring and fostering top talent
At KPMG Tax Corporation, we are implementing initiatives toactively recruit top talent regardless of whether someone isalready a Certified Public Tax Accountant or not. Specifically,
we offer university internship programs for students to get areal sense of the advanced expertise and international natureof KPMG’s tax-related work. Prospective employees also
attend multiple trainings before and after formally joining thefirm and are well-supported to develop the expertise required
as tax professionals.

Provide opportunities to grow as a professional
We hold training on a regular basis that strengthens ourtechnical tax knowledge and language ability in order to beable to tackle any tax challenges faced by our clients. In
addition, we provide the opportunity for each professional
to attend KPMG Tax Professional Camp where they discussawareness and their understanding of tax-related mattersthrough various tangible scenarios that allows us to further
hone our technical expertise, client focus, and ability towork as a team.

Careers in Advisory
Training programs to reflect the diversity of our people and ourservices
We recognize that client needs continue to increase incomplexity so we must be prepared to face these businesschallenges head-on. By developing training targeted to eachof our services while embracing the diversity of each andevery professional, we will be able to take our work to thenext level.

Keeping up with technology and forming teams to support
transformation
Our advanced training program keeps our specialists up todate on advanced technology. Our people participate in avariety of training programs held both in Japan and abroad forthe development of next-generation leaders.
Hiring new grads and developing global talent for the long term
We have prepared various curricula to help our new graduates
grow as professionals. In order to develop global talent, we
encourage our people to seize opportunities to work abroad
and participate in overseas training programs.

KPMG-

Quality

Ignition
KPMG-

Cube

KPMG-

CareerToshihiro OTSUKA
Head of People, Performance and Culture© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

22

KPMG-Cube

Cube
Demonstrate our collective strength

Message from the Head of Advisory
While industry and societal structures have been changing at
an accelerated pace, the challenges our clients face havebecome more complex and far-reaching, ranging from thoserelated to the core business to those that involve business
transformation.
Our services also need to change in parallel with our clients’needs so that they can succeed in an increasingly competitive

global landscape and continue to grow sustainably in the future.
Making the most of our collective strength, KPMG Japan
integrates professional expertise and proprietary
methodologies from across Audit, Tax, and Advisory which
are enabled through the advanced technology at KPMG
Ignition Tokyo to deliver solutions to our clients’ challenges
through the KPMG global network.

KPMG-

Quality

Ignition
KPMG-

Cube

KPMG-

CareerMasahiko CHINO
Head of Advisory© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

23

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Increasing corporate value throughoverseas PMI (post-merger integration)

Achievement of work style reform
through HR Technology

It is said that the total amount of Japanese companies’
investment in overseas M&A in 2017 was about seven trillion yen(according to a survey by RECOF Corp.). However, when
acquiring foreign companies, it is not easy to achieve a return on
investment that justifies the purchase price due to differences inlanguages, culture, and organizational structures.
KPMG conducted a survey of American companies regarding
important factors in M&A and noted that the most common
response was “a robust integration plan.” KPMG believes that an
important success factor for M&A is to appropriately reflectissues discovered during due diligence in the integration plan.
We contribute to maximizing corporate value by providing ourclients consistent support from pre-deal through PMI.

While efforts around work style reform and diversification ofhuman resources are urgent management issues, measures are
required to properly grasp the current status of employees andincrease job satisfaction and engagement. Achievement of such
employee management requires the utilization of technology.
KPMG is utilizing cutting-edge technology such as AI for
engagement management and through various measures
including data analysis, planning, and execution, we arecontributing to the future of people management by maximizing
the use of these HR technologies.

Understanding and addressing
issues related to HR and work style

Important factors for American companies

11%

1.5 %

39 %

18 %

5.3 %

33.2%
42.4 %

31%
Robust integration plan
In-depth due diligence and analysis

Appropriate acquisition value
Favorable investment environment

Source: “U.S. Executives on M&A: Full Speed Ahead in 2016” published by KPMG U.S.

Global tax governance
The introduction and strengthening of taxation schemes that apply
across corporate groups, including overseas subsidiaries, meansthat the operations of Japanese multinational companies will
become more transparent. Japanese companies must address BEPS
on a global basis including transfer pricing documentation
requirements and taxation systems designed to counter tax havens.
These companies are therefore required to transform themselves onan unprecedented scale to achieve global tax management and copewith taxation risk. Significant tax reform is expected to happen
globally, like in the US where the corporate income tax rate waslowered from 35% to 21%. In this context, a global approach to thetax function has become increasingly important.
KPMG supports global Japanese companies through close
collaboration between our Japanese and local tax experts, who areexperienced in diverse tax management and international taxation
services and knowledgeable about best practices. In addition toaddressing taxation risk on a global scale, they also assist clients torealize globally competitive effective tax rates for their corporategroups.
Effective tax rates of major countries

25

26.50
19.00 20.00 24.00 25.00

33.33
29.79 30.86

25.84
Globalaverage24.25%

RussiaItaly

China Canada Germany Japan France

Source: Management issues for Japanese companies 2017, Japan Management Association
https://www.jma.or.jp/keikakusin/pdf/keieikadai2017.pdf

Group governance for management thattakes into account the cost of capital –progress around group governanceFollowing the revision of the Corporate Governance Code in June
2018, listed companies are expected to implement management
measures taking into account the cost of capital. To take calculatedrisks pursuing profitability beyond the cost of capital, companies
must achieve robust corporate governance across the entire group
including overseas subsidiaries. In addition, the board of directors of
the parent company must understand and adequately manage
mid-term business risks.
KPMG has established a system to support governance, risk
management, and compliance across a client’s entire global
operations as a one-stop service.

Agenda items for which the board of directors
deliberated longer than the previous year

8%
7%
10%

US

Source: Evidence of effective tax rates after American corporate tax reform

41%

23%

40.00

0
UK

Intentionally addressing through HR and work style measures
Addressing but not sufficiently reflected in related measures
Not intentionally addressing
Other
No response

11%

Effective tax rates for 2017
Effective tax rate after American corporate tax reform(%)
50

17.5 %

Sharing and discussion of responses to management issues and business risks
Discussion of the mid-term management plan
Discussion of management principles, business models and management policies
Discussion of corporate governance philosophy and policy
Discussion of group company management
Other / None in particular
Source: “Corporate Governance Survey 2017” published by KPMG Japan© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

24

KPMG-Cube

Cube

KPMG-

Quality

KPMG’s collective strength combined withdiverse expertise and global capability
Ignition
helps empower change.
Cube
Career
KPMG-

Demonstrate our collective strength

Strength in diversity
Professionals in specialized areas across KPMG Japan’s groupcompanies work together as each client engagement demands
a unique set of abilities spanning various fields of expertise and

KPMG-

requires us to reach across organizational boundaries. Only bycollaborating can we support our clients in creating value andtackling the issues they face. At the same time, this diversity ofexperience enriches our people and contributes to the growth of
our organization as a whole.

Functions / Service lines

Industries

Advisory
Strategy & operations

People and change

Financial andaccounting strategy

IT strategy andimplementation

Transactions

Corporate financeRestructuring

Internal control

Risk management

IPO

Financial

Automotive

Tax
Domestic taxation

International taxation

Transfer pricing

M&A
Electronics

Audit
Statutory audit

Technology, Media &Telecommunications

EnergyRetailInfrastructure

Pharmaceutical

Healthcare

Public Sector

Non-statutory audit

New Ecosystem

KPMG Japan’s initiative for social value creation

The first research group at a Japanese consulting firm
dedicated to mobility

The innovative development of technology will bring about fundamental
changes in the transportation of people and goods in the future.

KPMG Mobility InstituteAt a time of the greatest transformation in the automobile industry ina century, KPMG has been conducting a study, Mobility Ecosystem
2030, to examine the future of mobility with a focus on Europe.
Mobility, or the transport of people and goods, is an important
theme having a big influence on the world industrial structure. Thisis the result of developments in three innovative technologies: thedevelopment of electric vehicles, connected and autonomousvehicles, and Mobility-as-a-Service (MaaS) as represented by car
sharing. In order to understand what the future of mobility may hold,we must consider the collective insights of not only the automobile
industry, which plays the leading role in the mobility era, but a rangeof other industries including energy, industrial equipment, finance,
information and communication, and public sector. A survey
conducted by KPMG US expects that the future mobility service
market will generate a new value chain with a market size equivalent tothat of the current value chain (approximately one trillion US dollars).

At KPMG Japan, KPMG Mobility Institute will play a leading role incollaborating with its counterparts at other KPMG member firms
and with KPMG’s global team to conduct cross-sector research on
trends in mobility. Based on our belief that mobility is one of the key
areas of disruption for society, KPMG Japan aims to act as a hub forcollaboration between industry, academia and government, thereby
contributing to the development of mobility in Japan.

Thought leadership
KPMG publishes timely reports on emerging
and current business issues, incorporating
the results of surveys and research andadding our analysis and insights.

2018 Global CEO
Outlook2018 – A turning point for
UK retail energy?

Leveraging technologicalinnovation to establish a more
effective regulatory ecosystem

Beyond the hype© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

25

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Global Japanese Practice as the core of our global capabilities
KPMG does not work in silos; audit, tax and advisory
achieve borderless and seamless collaboration acrossfunctions and services. By organizing the best teams we
can send on the field, we mobilize for each client our
The Global Japanese Practice(GJP) is our global network thatassists Japanese companies toexpand and succeed overseas.
Expats from KPMG Japan aswell as Japanese-speaking
professionals based in 81 citiesin 36 countries provide a wide
range of services in cooperation
with other KPMG member firms.

Europe, Middle
East and Africa

collective strength based on various areas of expertise andglobal capabilities. We support and catalyze our clients'
value creation and deliver solutions to their challenges.

Americaspeoplepeople(incl 32 secondees)(incl 54 secondees)

People with secondment
experience 358
On secondment to Japan 17

Asia PacificpeopleThe numbers for each region are thenumber of Japanese-speaking
professionals. (as of June 2018)(incl 70 secondees)

Europe, Middle East and Africa
The Americas
The Americas region includes the UnitedStates, Canada, Mexico, Chile, and Brazil.
The Head of the Americas GJP is based in
New York. KPMG has worked for over 40
years as a pioneer supporting Japanesecompanies in the United States, wheremore than 280 Japanese professionals
are currently located. The head of GJP
for Latin America is based in Brazil
and provides assistance to businessdevelopment of subsidiaries of Japanesecompanies within the sub-region.

KPMG’s global network

KPMG International
As of September 30, 2017

Global Japanese Practice (GJP)
As of September 30, 2018

GJP in this region has its Head in London
and manages services to subsidiaries ofJapanese companies in the UK, Germany
and other major countries in Europe, as
well as in Eastern Europe, the Middle
East and Africa. Concerning the ongoingchallenges of Brexit, the KPMG Brexit and
EU response team, with members basedin Japan, the UK and Belgium, are in close
touch with the people and organizations
behind this change, which has significancefor all our clients. Sub-region Heads are
assigned to cover the Middle East andAfrica, Central and Eastern Europe, and
CIS for delivering assistance specific tothe sub-region.

Asia Pacific
For the rapidly growing ASEAN, China andIndia economies, a sub-region Head has
been appointed for each. In Oceania, East
Asia (other than Japan) and South India(including Bangladesh and Sri Lanka),
we are expanding our range of services
to subsidiaries of Japanese companies.
These services include entry into newmarkets and expansion of existing
business lines.

KPMG’s global network has a presence in 154 countries and includes nearly 200,000 people. We haveestablished an organization to provide high-quality, integrated services anywhere in the world and our
professionals coordinate with each other across countries and regions, service lines and industry sectors.
Europe, the Middle East, andAfricaAsia Pacific

The Americas

Total

People100,762

40,64555,856

197,263

Countries

114

20

20

154

Japanese speakers

75

340

280

695

22 cities, 16 countries

36 cities, 15 countries

23 cities, 5 countries

81 cities, 36 countries

Locations© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

26

Governance Structure / Management Committee Members

Governance Structure
KPMG Japan stands on the foundation formed by an audit firm and a tax
accounting firm. Our audit firm is committed to contributing to the sounddevelopment of the economy by ensuring the credibility of financial
information from an independent point of view, thus ensuring faircorporate activities and the protection of stakeholders.
Our tax accounting firm’s mission is to live up to the trust placed in us by
taxpayers and ensure, from an independent and fair-minded position, thattax obligations are fulfilled appropriately.
As a professional firm that bears this social responsibility, group companies
of KPMG Japan provide advisory services to satisfy the needs of clientsand society and achieve our vision of being “The Clear Choice.”

Audit

KPMG Japan
Management
Committee(KJMC)

Advisory

Tax

Management policies of KPMG Japan Management Committee

The KPMG Japan Management Committee comprises
representatives from the major member firms of KPMG Japan
including KPMG AZSA LLC, KPMG Tax Corporation, KPMG
Consulting, and KPMG FAS. The Committee discusses anddecides on the collaborative structure used by KPMG Japan aswell as material matters pertaining to the management of thefirms, including talent development, service improvement, andquality control. In this way we are able to pool all of the available
resources of KPMG to deliver the best possible services thatmeet our clients’ management requirements.

Management

KPMG Japan’s governance

As an accounting firm with a public interest mission, it is ourpolicy not to simply seek profit but to provide services that
contribute to the sound growth of clients and live up to the trust
placed in us by society. This policy is not limited to audit and tax
compliance, but applies to all of our services.
In order to live up to the high expectations for our firm in thisconstantly changing environment, we are continually seeking theideal group governance model.
Provision of non-audit services may cause a breach of
independence where we also provide audit services or a conflictof interest between non-audit services. To avoid these situations,
we continue to strengthen firm governance and use Sentinel,
KPMG International’s proprietary global conflicts andindependence checking system.

KPMG Japan provides services in thethree areas of audit, tax, and advisory,
with group companies working inharmony as one, under an efficient anddisciplined management structure.

16
14

13

10

3

9

6

12

15

11
7
4

2

1

8

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

27

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

5

Committee Members
1 Toshiya MORI

9 Hideaki KOYAMA

2 Hiroyuki SAKAI

10 Masahiro MIYAHARA

3 Masahiro MEKADA

11 Tsutomu TAKAHASHI

4 Takuji KANAI

12 Hiroyuki TAKANAMI

Chairman, KPMG Japan / Chairman, Global Japanese PracticeCEO, KPMG Japan / Managing Partner, KPMG AZSA LLC

COO, CFO

Head of Audit

Head of Quality and Risk Management

President, KPMG Consulting

Head of Marketing / Deputy Managing Partner, KPMG AZSA LLC

Chief Operating Officer and Tokyo Office Managing Partner, KPMG AZSA LLC

5 Yuichi KOMAKINE

13 Hiroshi MIURA

6 Tatsuya ENDOH

14 Eiji MIZUTANI

7 Masahiko CHINO

15 Yasushi YOKOI

8 Toshihiro OTSUKA

16 Kenryo GOTO

Head of Tax / Senior Partner, KPMG Tax Corporation

Deputy Head of Tax, KPMG Tax Corporation

Head of Advisory / Representative Partner, KPMG FASHead of People, Performance and Culture

KPMG Global Special Missions & Foreign Affairs

KPMG Ignition Tokyo SUKI Café

Agenda of the KPMG Japan
Management Committee
July 1, 2017 – June 30, 2018

Governance andrisk management

Strategy

20%
Performance andbusiness planning26%
By topic

12%

Marketing

Developing
talent23%

19%
Asia Pacific

Chairman of the Senior Review Board, KPMG AZSA LLC

Head of Tokai Area and Head of Diversity, KPMG AZSA LLC

8%
Global30%

By geographic
area

Japan

62%

Head of Kansai Area and Osaka Office Managing Partner, KPMG AZSA LLC© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

28

Service Lines

Service Lines

Promotion of information technologies within the business has eliminated restrictionsof time and space on economic activities and taken corporate activities to a new level.
Connecting all information in a network has sharply reduced the cost of informationnecessary for decision-making, thus making accurate information and credible
insights more valuable than ever.
KPMG Japan provides audit services to ensure the credibility of financial information,
tax services to promote fair tax practices and contribute to trust in society, andadvisory services based on credible insights to clear a way forward in an increasingly
complex society.

Audit

KPMG AZSA LLC

Otemachi Financial City

Tax

KPMG Tax Corporation
KPMG Social Insurance andLabor Advisors Corporation

Izumi Garden Tower

KPMG AZSA LLC

Advisory

KPMG Consulting Co., Ltd.
KPMG FAS Co., Ltd.
KPMG AZSA Sustainability Co., Ltd.
KPMG Healthcare Japan Co., Ltd.

Otemachi Financial City
© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

29

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

AuditIn recent years, society has come to expect not only financial information, but also
credibility and transparency from corporations regarding their activities. The scope ofassurance engagements has therefore been expanding.
With KPMG AZSA’s financial audit services at our core, KPMG Japan also provides
assurance services for areas including internal control, IT systems and sustainability
related information.
By providing credible services related to financial and nonfinancial information, we
contribute to the growth of clients and the economy.

Reasons to choose us

Our Story - Audit 2018

1 A quality control system that clarifies roles and responsibilities and

1 Delivered audit services and demonstrated expertise and professional

helps management policies to be disseminated throughout theorganization (Four Defense Lines)

2 Initiatives centered around KPMG Ignition Tokyo with the objective ofusing cutting-edge technology for advanced data analysis

3 Use of KPMG’s global network and diversity of professionals who canService portfolio

cope with globalization issues faced by companies

skepticism to respond to various risks that companies face

2 Improved the effectiveness and efficiency of audit operations byadopting audit methods driven by Data & Analytics

3 Established necessary audit infrastructure to allow judgments to bemade within Japan, which includes expertise on IFRS, US GAAP andJapan GAAP.

Statutory Audit under the Financial Instruments and Exchange Act
audit
Audit under the Companies Act
Audit of Financial Statements prepared in accordance with theInternational Financial Reporting Standards (IFRS)
Audit of financial statements under SEC standards
Incorporated administrative agency audit
Incorporated educational institution audit
Credit union, workers’ credit union, credit cooperative audit
Labor union audit
Investment Limited Partnerships (ILPs) audit
Special Purpose Company (SPC) audit

KPMG Japan’s initiative for social value creation

Next-generation audit initiatives
Aiming to continually enhance the high quality of ouraudit services, KPMG AZSA moved our Statisticaland Technological Audit Research Team to sit in
KPMG Ignition Tokyo in order to promote the use of
cutting-edge technology and the involvement ofprofessionals with non-accounting backgrounds,
such as data scientists and AI experts.

Financial statement audit of companies to which statutory audit is not
Nonstatutory applicable
audit
Audit in accordance with the Financial Instruments and Exchange Act forthe purpose of public offering
Audit of financial statements prepared in accordance with special
purpose framework
Audit of single financial statements and specific elements, accounts oritems of a financial statement
Systems audit/project audit
Assurance Assurance engagement other than auditor review of historical financial
information
Assurance engagement for internal control concerning fiduciary obligation
Information security verification services
Assurance engagement for sustainability reporting

Partner, KPMG AZSA

Tsutomu OGAWA
Head, Statistical and Technological Audit Research Team
Tsutomu leads the Statistical and Technological Audit Research
Team that studies and implements audit methods that utilize
data analysis and AI in response to the increased sophisticationof IT systems and information processing technology.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

30

Service Lines

Tax

KPMG Tax Corporation provides tax services in Japan.
The global business landscape is continuing to undergo tremendous change andcompanies are ever more exposed to new challenges such as measures taken by tax
authorities to address aggressive tax avoidance by multinational corporations.
By drawing on not only our Japan network but also our tax professionals from KPMG's
global network, we are dedicated to helping our clients succeed and are passionate
about providing comprehensive advice. Using our understanding of governance and our
deep industry knowledge, we help clients stay competitive and compliant.

Reasons to choose us

Our Story - Tax 2018

1 Our capabilities in providing cross-border services by utilizing KPMG’s

1 Expanded M&A related services in line with an increase in overseas

global network

expansions and cross-border transactions by Japanese companies

2 A wealth of top-class tax professionals with expertise in eachspecialized area

the growing importance for multinationals to address BEPS

3 Provision of practical tax advice with cutting-edge IT technology inaccordance with the particular needs of clients

Service portfolio

2 Increased international tax and transfer pricing services to respond to
3 Provided tax cost optimization services in relation to development/
reorganization of a supply chain which takes account of customs
duties and other indirect taxes

KPMG Japan’s initiative for social value creation
International tax

Transfer pricing

Domestic tax

M&A

Real estatetransactions

Global mobility

Finance &technology

Outsourcing

Addressing BEPS* issues through KPMG’sinternational tax and transfer pricing services
Following the OECD’s fundamental review of global tax rules,
multinational companies are required to submit country-by-country
reports, which could increase the risk of double taxation. While theappropriate control of tax-related risks is a key issue, many companies
in Japan do not have a clear understanding of their overseas
subsidiaries’ tax status resulting in a lag in the implementation of a
global tax governance policy. Going forward, it is only a matter of time
before tax authorities set up an information network globally andcompanies’ profit and loss and tax burden in each jurisdiction
becomes transparent. In such an environment, the proper handling of
BEPS issues will present a critical challenge for companies tobecome truly global. At KPMG Japan, we help Japanese companies
build a global tax governance system which is spearheaded by their
headquarters in Japan. We support clients to enhance their
management process and help them succeed amidst intenseinternational competition.

Ten Key Points for Global Tax Management
Guidelines for Japanese companies to solve challenges in the
global tax environment
For Japanese companies accelerating the expansion of theirbusiness overseas, the establishment of a global tax management
system is an important and ongoing management issue.
KPMG Tax Corporation regularly publishes an online newsletter titled“Ten Things to Do to Achieve Global Tax Management” which
provides guidelines for headquarters regarding tax planning, tax risk
management, and other tax issues to help support the tax
departments of Japanese multinationals understand what they needto address in the current environment.
Furthermore, KPMG International publishes the Global Tax
Benchmarking Survey report assessing the current status and future
outlook of tax departments worldwide, which offers useful
information regarding the challenges and opportunities, such as thescope of duties, structure and budget of the tax department.

*BEPS: BEPS or Base Erosion and Profit Shifting refers to multinational companies’
tax avoidance strategies on the basis of national taxation. As BEPS is regarded as afactor that could threaten the credibility of tax schemes, international measures arebeing carried out to prevent it.
© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

31

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Advisory

KPMG Japan’s advisory services comprise three service groups: risk consulting, deal
advisory, and management consulting.
Leveraging KPMG’s global network, we provide clients a wide range of solutions tochallenging management issues and support them to grow.

Reasons to choose us

Our Story - Advisory 2018

1 Provision of one-stop advice, through collaboration with specialists

1 Undertook cross-border, cross-functional comprehensive initiatives towith various expertise and the KPMG global network

2 Use of advanced technologies to support the transformation of clients’business models and operations

3 Provision of quality-focused services by professionals with expertise

fulfill needs of increasingly globalizing corporations

2 Expanded an attempt to use cutting-edge technology, such as AI, thecloud, robotics and blockchain

3 Carried out advisory services that address expanding risks andAdvisory Service Framework

opportunities presented by advanced digital technology

Risk consulting
We provide practical knowhow regarding potential risks to thesmooth operation of the clients’ business, from matters of risk
management, compliance and internal control, to internal audit andcyber security, among other areas. We also support clients to build
and implement optimal global group management structures.
Deal advisory
We provide comprehensive one-stop support needed frompre-deal to post-deal for M&A advisory and business portfolio
restructuring to assist clients to revitalize their businesses. Other
advisory services provided relate to the improvement of financial
position, avoidance of performance deterioration and formulationand implementation of growth strategies.
Management consulting
We support the transformation of business models and operations
by using advanced technologies. Consulting services cover a wide
range from planning of operations and digital strategies, business
transformation, including supply chain optimization andmanagement structure reorganization, to designing oforganizational and personnel systems, and proposals on how to
use IT to achieve the optimal effect for each of these services.

Advisory by industry sector
Our professionals with knowledge and insight in theirrespective industries satisfy a wide range of client needs,
by utilizing global tools containing the latest information
accumulated across a wide array of industries.

KPMG Japan’s initiative for social value creation

The NEXT Unicorn Advisory Office was formed
to support startups that will be drivers of the next
generation in Japan.
Most companies seek to break free from their existing principles,
promoting open innovation to generate new services and value by
combining the technologies and ideas of ventures and universities.
Compared to the US, there are a smaller number of entrepreneurs
launching businesses in Japan due to complex regulations and rules
for new products and services, talent pools preferring to work for
major companies and a lack of investors. However, thanks to open
innovation, a number of start-ups have emerged recently.
It is a key challenge for government and the private sector toencourage start-ups with innovative ideas and services so that they
can grow to be the “unicorns” (companies valued at more than one
billion dollars) that will lead the Japanese economy and bringtransformative changes to society.
For such promising ventures, however, rapid business expansion
could ultimately put a damper on their growth because theircorporate departments, such as finance and accounting, are notsufficiently equipped to respond to such changes.
KPMG Japan established The NEXT Unicorn Advisory Officecomprised of members who have deep experience in IPO audit andadvisory to help start-ups solve various challenges that arise on theroad to becoming unicorns.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

32

Solutions to social challenges / Citizenship

KPMG Japan’s solutions to social challenges
In order to solve the problems of a complex society it is necessary to utilize insights gained from various fields.
In areas of significant public interest in particular, expectations are on the rise for the private sector to contribute its
accumulated insights, experience and methodologies. KPMG Japan plays a role in making this a reality.

Support for the introduction of concession methods for Fukuoka Airport(Japan Civil Aviation Bureau)

The Ministry of Land, Infrastructure, Transport and Tourism
decided to privatize Fukuoka Airport with an aim to promote
revitalization and development of the airport and its surrounding
areas by welcoming many more visitors. The private sector
company that won the bid to operate the airport did so withthe concept of “a top international airport in East Asia with an
unparalleled network in East and Southeast Asia.”
With professional knowledge and experience in the public sector,
accounting, tax, M&A, and financing, KPMG Japan supported thewinner of the bid throughout the entire concession process fromthe initial review stage through bidding.
With deep experience regarding public-private collaborations
including the concession process, KPMG Japan provides
advisory services to various public facilities including airports,
ports, MICE*, waterworks and sports facilities.
* MICE: Meeting, Incentive Travel, Convention, Exhibition/Event

Support for the privatization of the Osaka Subway
As a municipally-owned entity, the Osaka Municipal Transportation
Bureau has been able to establish and operate a transportation
network indispensable for daily life in the Osaka metropolitan
region that might have otherwise been difficult to implement as a
private company. However, due to pressure in recent years tofurther develop the business and improve user satisfaction
through more flexible management as well as expectations for agreater contribution to revitalization of the region, there is a needto move away from the city-operated model.
KPMG AZSA and KPMG Tax Corporation formed a consortiumwith legal professionals and think tanks to provide support for theprivatization project by leveraging expert knowledge and knowhow within the private railway sector.
After privatization, Osaka Metro strives to win the hearts of its
users by developing its services under the slogan “continuously
running, continuously changing.” As Japan faces the challenges
of a population increasingly concentrated in Tokyo and a rapidly
aging society, this major privatization project of a municipallyowned entity is expected to be a role model for considering how
Japanese publicly owned entities should work in the future.

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

33

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Career University

Support for parasports
The Nippon Foundation Paralympic Support Center was establishedwith the objective of promoting parasports. In Japan, there are manysmall parasport associations, but additional effort is required tostrengthen their organizational operations.
Young staff of KPMG Japan voluntarily support the associations byproviding auditing services of the grants received from the Nippon
Foundation Paralympic Support Center.

Initiatives towards reconstruction of disaster-stricken areas
Beginning in 2016, a project called the “Fukushima Business
Development School” was established with support from theReconstruction Agency in order to develop local business leaders.
Partners and staff from KPMG Japan provide advice to future businessleaders in the disaster-stricken areas regarding their early-phasebusiness plans, act as mentors, and support the development of talent
to lead industries in these areas.

Initiatives in education
In order to solve social issues and contribute to the realization of asustainable society, KPMG Japan takes advantage of our experienceand insight gained through our core business to focus on ourcontribution to education based on our core mission of providing
insights to society.
Managerial talent development
KPMG AZSA holds pro bono seminars at research institutions including
graduate schools as well as a seminar for the development of female
leaders in finance and accounting. Through these activities we hope tocontribute to the improvement of business management literacy bymaking the most of our accumulated professional skills and insights.

Citizenship
Being aware of our standing as a member ofsociety and a corporate citizen, we fulfill our
responsibility as a group of professionals, whileat the same time, we stand firmly committed totaking action to make our society and theenvironment a better place.

Career development support
for high school and university students
In order to promote understanding of accounting and auditing, KPMG
AZSA holds the “AZSA Accounting and Auditing Class” for high school
students and participates in the “Dorikamu School,” a career education
project for communicating how society operates through an accounting
lens. KPMG Japan further sponsors the “GTE Innovation Challenge
Summer Camp & Business Plan Contest” with an aim to develop andsupport potential innovators, and also provides lessons andopportunities for university students to learn about accounting andadvisory services through business games.

Sports-related initiatives

Blind Soccer

Career University

Sponsoring the FIT For Charity Run
KPMG Japan also supports sports-related initiatives. One example is ourparticipation in the FIT For Charity Run (Financial Industry in Tokyo for
Charity Run), a charity event held by companies in the financial sector
and related organizations since 2007. We continually support NPOs
engaged in community-rooted meaningful activities. Many KPMG
members participate in the run every year to raise money for charity.
Support for blind soccer
We entered into a partnership contract with the NPO Japan Blind Soccer
Association, helping to increase awareness of blind soccer by holding
the Club Championship event each year since 2016. Staff from across
KPMG AZSA and KPMG group companies participate in the KPMG
Japan Futsal Games held concurrently with the Club Championship topromote internal networking.

Global issues, environmental initiatives
Based on KPMG’s Global Green Initiatives, we take various measures toreduce CO2 emissions.
©Nippon Foundation Paralympic Support Center

Support for parasports

Details of our Citizenship Initiatives are available on KPMG Japan’s website: kpmg.com/jp/csr© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

34

Our Performance / Group Companies

Our Performance
Revenues (hundred million yen)
1,281

1,387

497

Number of Employees

1,449

7,248 2,352

429

153
699

8,309
7,883 2,532

518
2,085

166

169
721

Advisory
Tax
Audit

5,083

4,867

4,619

765

694

664

544

Advisory
Tax
Audit
June 2016

June 2017

June 2018

June 2016

June 2017

June 2018* Tax service revenues included are for fiscal years from October 1 to September 30.

Number of Global Professionals*
3,002

Investment in Human Resource
Development (hundred million yen)

679

2,965

17.1
16.0

632

2,762

June 2016

Number of Employees Seconded
Overseas

14.9

591

June 2017

June 2018

June 2016

June 2017

June 2018

June 2016

June 2017

June 2018* Global professionals are those who have overseas
work experience, have been in global skill training
courses, or are foreign nationals.

Aggregate Training Hours

M&A Advisory Ranking(including banks, securities companies, and other financial institutions)

390,830

398,153

416,888

2016

2017

2018

Based on publicly
announced deals

4

5

5

Based on In-Out deals

1

3

3

(Acquisition of foreign companies
by companies based in Japan)

Source: Thomson Reuters
June 2016

June 2017

June 2018© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

35

KPMG Japan© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Overview of Group Companies
About KPMG

KPMG is a global network of professional firms providing Audit,
Tax and Advisory services.
The KPMG network was formed in 1987 when Peat Marwick
International (PMI) and Klynveld Main Goerdeler (KMG) merged
along with their respective member firms. Member firms of the
KPMG network are affiliated with KPMG International
Cooperative (“KPMG International”), a Swiss entity.

KPMG International
Revenues

US$26.4 billion

Number of
personnel

197,263

Number ofcountries

154

Registration

Zug, Switzerland(As of September 2017)

KPMG Japan
Group Companies

KPMG Japan

KPMG AZSA LLC

ChairmanToshiya MORI

KPMG AZSA LLC offers professional services, including audit, assurance, IFRS advisory, accounting
advisory, financial advisory, IT advisory, and middle market development. In addition, we deliver
expert services tailored to the sector-specific needs of the financial, information/telecommunication/
media, retail, energy, manufacturing, and public sectors.

CEO
Hiroyuki SAKAIManaging Partner, Hiroyuki SAKAIKPMG Tax Corporation

Representative Partner, Yuichi KOMAKINEKPMG Tax Corporation’s teams of specialists offer bespoke tax advice to Japanese companies,
Japanese subsidiaries of foreign companies, and more. Our tax-related services include preparationof tax returns, tax investigation support, advice related to M&A, corporate restructuring andrevitalization, consolidated tax return filing, international taxation, transfer pricing, customs andtariffs, and business inheritance.
KPMG Consulting Co., Ltd.

President Masahiro MIYAHARAKPMG Consulting assists clients to transform business models or improve operations through theutilization of advanced technology. Our advisory services are diverse, some of which include
business strategy planning, improvement in operational efficiency, profit management capability,
governance, risk management, IT strategy planning, IT system/tool implementation support,organization and human resource management reform, and cyber security.
KPMG FAS Co., Ltd.

Representative Directors, Masahiko CHINO, Hiroyuki OSHIDA, Hikaru OKADAKPMG FAS offers comprehensive support across all phases of corporate activities to add the mostvalue, ranging from strategy planning and transactions (such as M&A, business restructuring, andcorporate revitalization) to post-deal. Primary services are related to M&A advisory work (feasibility
analysis, valuation, due diligence, structuring advice), corporate revitalization advisory work,
management strategy consulting, and fraud investigation.
KPMG Healthcare Japan Co., Ltd.

KPMG AZSA Sustainability Co., Ltd.

Representative Directors, Keiichi OHWARI, Jun MATSUDA
KPMG Healthcare Japan provides business and financial advisory services
in the healthcare industry, including medical and nursing care. Advisory
services are related to strategy, risk evaluation, M&A, finance, and business
revitalization.

Managing Partners, Kazuhiko SAITO, Yoshitake FUNAKOSHIKPMG AZSA Sustainability provides third-party assurance services forcompanies to raise the credibility of their non-financial information. We
assist companies’ pursuit of sustainability by supporting corporate
performance and risk control in the sustainability field as well as
enhancement of non-financial disclosures.

KPMG Social Insurance and Labor Advisors Corporation

AZSA Office Mate Co., Ltd.

Representative, Mayumi OGAWA

President, Toshihiro OTSUKA

KPMG Social Insurance and Labor Advisors provides outsourcing services
to back-office administrative operations primarily for foreign corporations
entering Japan and subsidiaries of Japanese companies. Specific services
range from support of the establishment of a legal entity in Japan toongoing human resource services (payroll and social/labor insurance
administration).

In order to assist individuals with disabilities achieve independence, AZSA
Office Mate employs individuals with primarily intellectual disabilities as“office mates.” These employees are responsible for work including
preparation for external seminars, printing and binding materials, sorting andfiling accounting documents, sorting and shipping of stationary for reuse,business card printing and restocking of stationary.

Editorial Policy Since 2015, we have been issuing KPMG Japan Our Story, which reports
on KPMG Japan’s shared principles and philosophy, as well as initiatives whereby we canconsistently respond to social and client expectations to provide more value as a group of
professional firms dedicated to delivering outstanding service. This report is prepared andedited with the principles of integrated reporting in mind.

Reporting Period Performance data is provided for primarily the period of Fiscal Year 2018
(July 2017 – June 2018). In addition to reviewing the current state of the firm, the report alsopresents our outlook for the years to come.

Scope of the Report In principle, the Report focuses on KPMG Japan group companies.
Information and performance data of specific organizations are individually described.
KPMG Japan’s group companies are listed above.

Contact Information KPMG JapanOTEMACHI FINANCIAL CITY South Tower 1-9-7 Otemachi, Chiyoda-ku, Tokyo 100-8172+81-3-3266-7562

Publication date October 2018

© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the
KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Our Story 2018/19

36

KPMG JapanOTEMACHI FINANCIAL CITY South Tower
1-9-7 Otemachi, Chiyoda-ku,
Tokyo 100-8172
TEL: +81-3-3266-7562

kpmg.com/jp

KPMG Japan Our Story 2018 / 19

Contact us

KPMG Japan
Our Story
2018/19
KPMG Japankpmg.com/jp/socialmedia

The information contained herein is of a general nature and is not intended to address the circumstances of any particular
individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that suchinformation is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act onsuch information without appropriate professional advice after a thorough examination of the particular situation.
© 2019 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law
and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative(“KPMGInternational”), a Swiss entity. All rights reserved. Printed in Japan. 19-5006© 2019 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG
network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.
All rights reserved.
The KPMG name and logo are registered trademarks or trademarks of KPMG International.

kpmg.com/jp