Japan Press Weekly

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2013 March 6 - 12 [POLITICS]

Outside auditors have cozy ties with Hokkaido electric power company

Hokkaido Electric Power Co., Inc. (HEPCO) has cozy ties with its outside auditors while forcing consumers to choose between an increase in electricity bills and the restart of the Tomari nuclear power plant, pointed out a Japanese Communist Party assemblyperson at a prefectural assembly session on March 11.

Mashita Noriko, JCP member of the Hokkaido Prefectural Assembly, revealed that as soon as assuming the HEPCO’s auditing position, three outside auditors began holding stocks in the utility and received big dividends.

Among the three, a former chief judge of the Nagoya District Court increased his shares from zero to 9,800 during his 15 years as auditor, which amounts to more shares than the HEPCO president held; an executive director (now president) of North Pacific Bank, Ltd., a major shareholder of HEPCO, possessed 2,100 shares; and a former president of Hokkaido University held 4,300 shares of stock.

The Tomari plant operator paid 7-8 million yen in monetary reward to these auditors. The amount of their remuneration and dividends were included in advance in the electricity rate the people in Hokkaido paid.

Outside company auditors should be neutral and go over the books with fair and impartial eyes. The JCP assemblyperson said to Hokkaido Governor Takahashi Harumi, “If this continues, a role of “outside” auditors assessing HEPCO will be just for form.”