Baby Calendar Discloses Material Weakness in Financial Reporting Internal Controls

TOKYO, Jun 30 (Pulse News Wire) – Baby Calendar Inc. (7363.T) disclosed a material weakness in its financial reporting internal controls based on findings in its fiscal 2024 internal control report submitted to the Kanto Finance Bureau Chief.

The issue was identified through an investigation into unrecorded advertising revenue payments, leading to the recognition of improper actions by a former CFO. As a result, the company established a special investigative committee comprising external lawyers and certified public accountants on Feb 13, 2026, which confirmed the misappropriation of sales and cash by the former CFO on Mar 31, 2026. In response, the company corrected previously filed financial statements, interim reports, and quarterly reports.

It also implemented several corrective measures, including strengthening approval processes for advertising revenue payments, enhancing segregation of duties, improving audit functions, and reinforcing IT controls. Despite completing the initial steps, the comprehensive rectification process remains ongoing. The revised financial statements reflect all necessary adjustments resulting from the identified weaknesses.

The latest audit opinion on the corrected financial statements is unqualified.