Formulation of Measures to Prevent Recurrence and Disciplinary Actions Against the Parties Involved
J.E.T.Co.,LTD.
Multiple semiconductor cleaning equipment products
Inadequate establishment and operation of the start-up completion reporting criteria used as the revenue recognition criteria, insufficient checking and oversight functions by the Finance Department, deficiencies in internal auditing, governance issues, and problems with management's accounting literacy and integrity
Company response
Investigation by a special investigation committee. An Improvement Measures Promotion Committee was established, chaired by Representative Director Hirai Hiroyuki (平井洋行), and comprising outside directors, a full-time Audit & Supervisory Board member and advisors including certified public accountants.
Review of the definition of “start-up completion” under the start-up completion reporting criteria, thorough establishment and operation of revenue recognition criteria, institutionalization of Finance Department approval for revenue recognition, appointment of a director dedicated to the administrative division, internal audits based on assumed fraud risks, and enhancement of governance for addressing accounting fraud risks
The 3 directors allegedly involved in this matter will resign upon the conclusion of the adjourned session of the Ordinary General Meeting of Shareholders scheduled for 15 July 2026. The Representative Director, CEO and other executives will voluntarily return part of their monthly compensation and directors' retirement bonuses.
At an Extraordinary General Meeting of Shareholders scheduled for September 2026, the Company will appoint a director dedicated to the administrative division and other officers and establish a new management structure. It will implement the measures to prevent recurrence and work to restore trust.
The Company plans to determine the details of the new management structure at an Extraordinary General Meeting of Shareholders scheduled for September 2026 and provide an update.
| Item | Details |
|---|---|
| Event name | Formulation of Measures to Prevent Recurrence and Disciplinary Actions Against the Parties Involved |
| Subject Entity | J.E.T.Co.,LTD. |
| Target Locations / Products | Multiple semiconductor cleaning equipment products |
| Cause | Inadequate establishment and operation of the start-up completion reporting criteria used as the revenue recognition criteria, insufficient checking and oversight functions by the Finance Department, deficiencies in internal auditing, governance issues, and problems with management's accounting literacy and integrity |
| Investigation structure | Investigation by a special investigation committee. An Improvement Measures Promotion Committee was established, chaired by Representative Director Hirai Hiroyuki (平井洋行), and comprising outside directors, a full-time Audit & Supervisory Board member and advisors including certified public accountants. |
| Measures to prevent recurrence | Review of the definition of “start-up completion” under the start-up completion reporting criteria, thorough establishment and operation of revenue recognition criteria, institutionalization of Finance Department approval for revenue recognition, appointment of a director dedicated to the administrative division, internal audits based on assumed fraud risks, and enhancement of governance for addressing accounting fraud risks |
| Directors' and officers' liability | The 3 directors allegedly involved in this matter will resign upon the conclusion of the adjourned session of the Ordinary General Meeting of Shareholders scheduled for 15 July 2026. The Representative Director, CEO and other executives will voluntarily return part of their monthly compensation and directors' retirement bonuses. |
| Outlook | At an Extraordinary General Meeting of Shareholders scheduled for September 2026, the Company will appoint a director dedicated to the administrative division and other officers and establish a new management structure. It will implement the measures to prevent recurrence and work to restore trust. |
| Planned follow-up disclosure | The Company plans to determine the details of the new management structure at an Extraordinary General Meeting of Shareholders scheduled for September 2026 and provide an update. |
Items this document does not state (16)
These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.
The reasons the company gives
The company's own explanation, not something inferred from the numbers.A special investigation committee found that the timing of revenue recognition for multiple semiconductor cleaning equipment products had been improperly manipulated during the fiscal years from December 2022 through December 2024. The Company identified the main causes as inadequate establishment and operation of revenue recognition criteria, insufficient checking and oversight functions in the Finance Department, problems with internal auditing, and governance issues.