We provide audit services for subsidiaries in Japan under foreign capital entity.
There are two types of audit. One is where procedures are performed according to instructions from the Group auditors of parent company. The other is where Japanese auditors conduct the audit in their discretion.
The former case audit is called “Referred works.”
Referred works would be usually performed by member firms of parent company’s auditor if the subsidiary accounted for a significant part. However, it is not so unusual to ask an individual CPA or a small-sized audit firms, where the size of the subsidiary was not so big. The auditors performing procedures for the subsidiary are entirely regarded as different component even though they belong to the same group firms. This means there would be no differences whether the component auditor was an individual CPA or the same group firm. And workloads would not be reduced if conducted by the group firm.
Rather, in the case of audit for small-sized consolidated subsidiary, inexperienced staff might be assigned if you ask Big4 firms. Because well-experienced staff members are preferentially assigned for big clients in Japan. In such a case, you might accumulate complaints in auditor’s performance although high audit fee was always charged. Given these facts, you should consider asking audit to other individual CPAs with affluent experience and expertise.
Our Advantageous Points
When performing “referred works,” we assign proficient CPAs who have experience working for Big4 firms and dealing with referred works for subsidiaries of overseas listed entities. In addition to providing standard audit services, we offer flexible advice on closing procedures in accordance with IFRS and US-GAAP. Our audit quality is comparable to that of Big4 firms because our well-experienced CPAs lead referred work. Unlike Big4 firms that rely on many professionals, we strive to implement audit procedures with a minimal number of staff members. This approach enables us to offer reasonable service fees to our clients. If you are frustrated with the high audit fees for your subsidiary, please feel free to contact us for more information about our services.