Distribution of surplus in excess of the distributable amount
CONSEC CORPORATION
Year-end dividend for the fiscal year ended March 2025
The directors and employees in the Administration Department lacked knowledge of and awareness regarding the Companies Act restrictions on dividend payments; the checking system and procedures for verifying the distributable amount were inadequate; and the internal controls were ineffective.
Company response
An external investigation committee established on 15 October 2026. The committee is chaired by attorney Mizutani Kohei (水谷 耕平), with attorney Fujioka Tatsuma (藤岡 達麻) and certified public accountant Abe Takayuki (安部 貴之) as members. The company received the investigation report dated 5 November 2026.
⑴ Conduct internal training and other measures; ⑵ clarify the division of duties and establish work procedures; ⑶ improve the methods used by the officers' meeting to deliberate matters; ⑷ strengthen internal audits; ⑸ make use of internal and external personnel
All 6 directors who agreed to the proposal for the dividend will voluntarily return 10% to 30% of the portion of their compensation corresponding to 3 months. All 3 audit & supervisory board members will voluntarily return 10% of the portion of their compensation corresponding to 3 months. The company does not plan to pursue legal liability against the parties concerned.
¥47,497,239 (total year-end dividend, representing a distribution in excess of the distributable amount)
Fiscal year ended March 2025
Related procedures
Investigation by an external investigation committee
The company will implement the measures to prevent recurrence steadily and work to establish a robust internal control framework.
| Item | Details |
|---|---|
| Event name | Distribution of surplus in excess of the distributable amount |
| Date of occurrence | 26 June 2025 (dividend payment date) |
| Date recognized / date notice received | 23 June 2025 (the date on which the responsible accountant explained the shortfall in the distributable amount to the representative and the head of the Administration Headquarters) |
| Subject Entity | CONSEC CORPORATION |
| Target Locations / Products | Year-end dividend for the fiscal year ended March 2025 |
| Cause | The directors and employees in the Administration Department lacked knowledge of and awareness regarding the Companies Act restrictions on dividend payments; the checking system and procedures for verifying the distributable amount were inadequate; and the internal controls were ineffective. |
| Amount of Impact on Business Performance | ¥47,497,239 (total year-end dividend, representing a distribution in excess of the distributable amount) |
| Accounting period in which recognized | Fiscal year ended March 2025 |
| Type of litigation or proceeding | Investigation by an external investigation committee |
| Investigation structure | An external investigation committee established on 15 October 2026. The committee is chaired by attorney Mizutani Kohei (水谷 耕平), with attorney Fujioka Tatsuma (藤岡 達麻) and certified public accountant Abe Takayuki (安部 貴之) as members. The company received the investigation report dated 5 November 2026. |
| Measures to prevent recurrence | ⑴ Conduct internal training and other measures; ⑵ clarify the division of duties and establish work procedures; ⑶ improve the methods used by the officers' meeting to deliberate matters; ⑷ strengthen internal audits; ⑸ make use of internal and external personnel |
| Directors' and officers' liability | All 6 directors who agreed to the proposal for the dividend will voluntarily return 10% to 30% of the portion of their compensation corresponding to 3 months. All 3 audit & supervisory board members will voluntarily return 10% of the portion of their compensation corresponding to 3 months. The company does not plan to pursue legal liability against the parties concerned. |
| Outlook | The company will implement the measures to prevent recurrence steadily and work to establish a robust internal control framework. |
Items this document does not state (12)
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.The directors and employees in the Administration Department lacked sufficient knowledge of and awareness regarding the Companies Act restrictions on dividend payments; no checking system or procedures had been established to verify the distributable amount; and internal controls to deter unlawful dividends had not been adequately developed.