Living up to our society’s expectations

The Certified Public Tax Accountant Act (Zeirishi Act) stipulates the mission of certified public tax accountants (CPTAs) in its Article 1 as follows:
“The mission of Zeirishi, as experts in matters of taxation, shall be to strive from an independent and fair standpoint, in accordance with the principles of the self-assessment system, to prove themselves worthy of the trust of taxpayers and ensure the fulfillment of the tax liabilities stipulated in laws and ordinances concerned with taxes.”

Charged with this mission, TKC National Federation (“TKCNF”) has been actively offering support to small and medium-sized enterprises (SMEs) for achieving profits in financial statements and filing appropriate corporate tax returns.

The roles of certified public tax accountants in society

Mr. John L. Carey, an executive director of the American Institute of Certified Public Accountants, made the following statement about the roles of professional accountants in society in his 1965 book, The CPA Plans for The Future.

“There is no theoretical separation between auditing, taxation, and managerial advice. Their objectives differ but they all entail diverse classifications, analyses, and commentaries based on the same data.”

From this, we can deduce that there are four types of work within the job scope of a certified public tax accountant (tax affairs, accounting, assurance, and managerial advice), that these areas of work overlap, and that accounting books exist as the common factor at their core. Certified public tax accountants are required to serve in society as experts in these four areas.

1. Experts in tax (tax lawyers)
The mission of certified public tax accountants, as tax lawyers, shall be to strive from an independent and fair standpoint to ensure the proper fulfillment of tax liabilities.

2. Experts in accounting (accounting professionals)
In recent years, Japan has led the world in formulating and publishing the Chusho Kaikei Yoryo (Guidelines for SME Accounting) and the Guidelines for SMEs as accounting standards for SMEs. Supporting the preparation of reliable financial statements in compliance with these documents is also an important duty of a certified public tax accountant.

3. Experts in assurance (tax auditors)
The system of submitting supporting documents pursuant to Article 33-2 of the Certified Public Tax Accountant Act should also be referred to as tax auditing certification. The work of ensuring the reliability of tax returns and financial statements of SMEs is becoming more and more important.

4. Experts in managerial advice (management advisors)
Certified public tax accountants use their knowledge of financial management and enterprise control accounting to offer managerial advice. The managerial advice offered by certified public tax accountants is essential for improving the soundness of the management of SMEs, which account for 99.7% of Japan’s enterprises.

How can the accuracy of accounting books be improved?

How to improve the accuracy of accounting books, which are at the core of the four areas, is an important challenge for certified public tax accountants to overcome in order to fulfill their role as experts in the said areas.

Therefore,we,TKCtaxaccountants,havetheadvantage of being able to ensure the accuracy of accounting books by (i) resolutely conducting monthly field audits at our clients’ locations to verify the timeliness and completeness of coverage of their accounting materials and records, and by (ii) using TKC systems, which completely cover all four areas of work and prohibit retrospective insertions, deletions, and corrections of data once the field audit is completed.

Leveraging this strength, we are committed to deepening our relationships with administrative agencies, organizations that support SMEs, as well as financial institutions, and to engaging in services aimed at enabling TKC tax accountants to gain the trust of corporate managers of SMEs as the closest and most sincere people with whom they can consult.