Internal Audits and Compliance System

Internal Audits
Principles of Internal Audits
We define an internal audit as a series of processes forGroup company’s internal audits.
The YMFG Audit and Inspection Dept. devises the rules andobjective verification of the appropriateness and effectivenessmedium- to long-term plans for the Group’s internal audits,of internal controls (including risk management) and as

implements audits of the Group companies’ compliance/riskmaking suggestions for necessary improvements.

management departments and checks the accuracy of theYMFG has devised standard internal audit rules for thefinancial statements of the Group companies. The department

whole Group. On the basis of these rules, the internalmonitors and gives guidance and advice to the Groupaudit departments of each Group company verify thecompanies’ audit and inspection departments. On the basis

appropriateness and effectiveness of internal controls andof their audit reports, the department reports on the internal

make suggestions for necessary improvements.

audits of the Group to the Board of Directors and audit andFurther, YMFG creates the Group’s medium- to long-term
internal audit plan on the basis of its management policy andsupervisory committee.
The banks’ audit and inspection departments implementconditions. Internal audits by the auditing bodies of eachinternal audits of branches in Japan and overseas, andGroup company are conducted on the basis of this plan toreports to YMFG and to the Board of Directors and audit

ensure their effectiveness and efficiency.

and supervisory committee. In particular, internal audits offront-line sales outlets are performed to verify the status ofImplementation of Internal Audits

compliance and risk management functions and ensure their

YMFG’s Audit and Inspection Dept. plans audit processes

mutual effectiveness.

for the whole Group, implements audits and supervises eachCompliance System
YMFG’s Attitude toward Compliancecommittee discusses ways to create and reinforce compliance

YMFG and its Group companies share a common understanding

systems, reports the results of these deliberations to the Boardof their responsibilities to fulfill their public mission andof Directors and reflects these results in Group operations.

corporate social responsibilities. Accordingly, we accord

YMFG’s Compliance Administration Department

topmost management priority to thorough compliance, takecommunicates with compliance personnel at each Groupthe seriousness of compliance seriously and consider earningcompany and, in accordance with the deliberations of thethe trust of a broad-based society our fundamental policy.

Group Compliance Committee, ensures the appropriateness ofcompliance systems for the entire Group.

Compliance System
We have established a compliance administration department

Efforts to Prevent Money Laundering

to take overall charge of ensuring appropriate compliance

The Act on Punishment of Organized Crimes and Control offor YMFG and its Group companies. Individual companies’

Crime Proceeds and the Law for Prevention of Transfer ofcompliance departments handle the centralized management

Criminal Proceeds prescribes heightened measures to preventof compliance-related activities, including the creation ofmoney laundering. The Group’s efforts are appropriate and incompliance structures and the training of executives andconformance with these regulations, in keeping with our aim

general employees. Compliance supervisors and officers at allof maintaining society’s trust in us as a financial institution.

departments and branches foster an enhanced awareness ofSpecifically, we have formulated a policy of controls andappropriate compliance in daily operations.

procedures reasonably designed to prevent and detect money

The Group Compliance Committee, chaired by thelaundering/terrorist financing activities. We have appointed

president, acts as a deliberative body. This committee

a senior officer to take charge of this policy and establishedformulates Group compliance programs for each fiscal year

training programs on this topic for all management and staff.

and monitors the status of program implementation. The

15YMFG Annual Report 2016