Internal Control is a process within an organization designed to provide reasonable assurance:

• - That information is reliable, accurate, and timely.
• - Of compliance with policies, plans, procedures, laws, regulations, and contracts.
• - That assets (including people) are safeguarded.
• - Of the most economical and efficient use of resources.
• - That overall established objectives and goals are met.

Internal controls are intended to prevent errors or irregularities, identify problems, and ensure that corrective action is taken.

To ensure transparency and reliability of financial reporting

As is evident from the May 2006 enforcement of the Company Law of Japan and the requirement placed on businesses to submit reports of their internal controls from the fiscal year ending March 2009, society is demanding that businesses be more transparent and reliable about that financial reporting. The Brother Group has seen this situation as an opportunity to make operations more efficient, strengthen our position against risks, promote group management and, thereby, improve corporate value, and has thus built a reporting system.