2003 Fiscal Year Final Research Report Summary
Impact on Corporation Law made by International Unification of Accounting Standards
| Project/Area Number |
13420013
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| Research Category |
Grant-in-Aid for Scientific Research (B)
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| Allocation Type | Single-year Grants |
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| Section | 一般 |
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| Research Field |
Civil law
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| Research Institution | The University of Tokyo |
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Principal Investigator |
EGASHIRA Kenjiro University of Tokyo, Graduate School of Law and Politics, Professor, 大学院・法学政治学研究科, 教授 (20009822)
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| Co-Investigator(Kenkyū-buntansha) |
KANDA Hideki The University of Tokyo, Graduate School of Law and Politics, Professor, 大学院・法学政治学研究科, 教授 (90114454)
YAMASHITA Tomonobu The University of Tokyo, Graduate School of Law and Politics, Professor, 大学院・法学政治学研究科, 教授 (10107485)
IWAHARA Shinsaku The University of Tokyo, School of Law and Politics, Professor, 大学院・法学政治学研究科, 教授 (20107486)
FUJITA Tomotaka The University of Tokyo, Graduate School of haw and Politics, Professor, 大学院・法学政治学研究科, 教授 (80209064)
MASUI Yoshihiro The University of Tokyo, Graduate School of Law and Politics, Professor, 大学院・法学政治学研究科, 教授 (90199688)
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| Project Period (FY) |
2001 – 2003
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| Keywords | International Accounting Standards / reform of corporation law / annual reports / financial statements / limitations on sources of dividends / stock purchase / subscription warrants / services as consideration for shares / corporation with committees |
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| Research Abstract |
International unification of accounting standards owing to establishment of International Accounting Standards by IASB has a large impact on Japanese corporation law in two aspects. One is how its provisions concerning accounting should be amended in harmony with the international movements. The other is how it should cope with the changes of business conducts of companies brought about by the new accounting standards.
Concerning the first point, we published several articles on the recent amendments of Japanese corporation law with regard to capital reserves and limitations on sources of dividends. The most important issue in the fixture is the Accounting Standard of Share-based Payment. Our conclusions on the issue are as follows. If Japanese corporation law is amended in harmony with the Exposure Draft on Share-based Payment of IASB, it must introduce the new idea which has not existed in Japan that the corporation may issue stock purchase/subscription warrants in exchange for servic
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es. There would be no serious problems in publicly-held corporations, if services are permitted as consideration for shares. However, some abuses might occur in the case of closely-held corporations which do not disclose any financial statements. Since there is a risk of overvaluation in services which have no market prices, the possibility should not be excluded that the corporation law requires the special resolution of shareholders meeting in case the corporations accept services as consideration of shares. Since services may be provided for a period of time, such amendment of corporation law is needed that payment by installment to stock purchase/subscription warrants is permitted. The principle of labor law that the wages shall always be paid in cash must be abolished.
Concerning the second point, the most serious problem to Japanese corporations was so-called "legend" of the financial statements written in English in 2001. However, the auditor system and the new type of corporation (corporation with committees) have become the most important issue after the Enron scandal in autumn of 2001. The Accounting Standard of Impairment of Assets which is to be applied in Japan from 2005 has a great influence on he conducts of business of Japanese corporations by giving rise to a great number of M&A and restructuring activities today. Less
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