Outline of Audits on Establishment and Implementation of JBATA's Framework

Article 23 of the JBA TIBOR Operational Rules ("Rules") requires that, on an annual basis, in principle, JBA TIBOR Administration ("JBATA") shall be subject to internal and external audits on "the execution of JBA TIBOR calculation and publication operations, establishment and implementation of processes/procedures and frameworks required under the Rules and the review of the JBA TIBOR administration framework (including reviewing the definitions and calculation methods)".

Internal audit by the Internal Audit Office and the assurance engagement[1]for the Description of the design, implementation and operation of internal controls over the JBA TIBOR calculation/publication operations ("Description of Internal Controls"), as well as the design and implementation of the internal controls, as external audit by Ernst & Young ShinNihon LLC were recently performed. We hereby report the overview of internal and external audits.

1. FY 2025 Internal Audit
(1) Auditors: JBA TIBOR Internal Audit Office
(2) Reference date: September 1, 2025
(3) Audit scope: Governance framework, Benchmark design, Establishment of benchmark calculation methodology, Accountability framework
(4) Audit result: No findings ordering improvement were identified. However, an issue relating to the documentation of the simplified system used to verify submission rates was identified as an item requiring improvement. The improvement status will be followed up in the internal audit for FY2026.

2. FY 2025 External Audit
(1) Practitioner: Ernst & Young ShinNihon LLC
(2) Reference date: March 31, 2026
(3) Audit scope: Fair presentation of the Description of Internal Controls, and the design and implementation of the internal controls
(4) Applicable criteria: "Principles for Financial Benchmarks - Final Report -" published by the International Organization of Securities Commissions in July 2013 ("IOSCO Principles")
(5) Standard used for the engagement: Practical Guideline on Assurance Engagements 3000 "Practical Guideline on Assurance Engagements Other than Audits or Reviews" issued by the Japanese Institute of Certified Public Accountants
(6) Audit result: In our opinion, the Description of Internal Controls fairly presents, in all material respects, the design and implementation of JBATA's internal controls over the calculation and publication of JBA TIBOR as of March 31, 2026, in accordance with the applicable criteria
Also, in our opinion, the internal controls over JBATA's JBA TIBOR calculation and publication operations described in the Description of Internal Controls were designed and implemented, in all material respects, as of March 31, 2026, so that those operations would be conducted in accordance with the Criteria.

For the details of "2. FY 2025 External Audit," please refer to the PDF file "Result of External Audit on JBATA's Framework in Compliance with IOSCO Principles (FY2025)" listed in "Result of External Audit on JBATA's Framework in Compliance with IOSCO Principles."

JBATA Note: The link to the "Result of External Audit on JBATA's Framework in Compliance with IOSCO Principles" provides access to the latest annual results.

JBATA will seek to maintain and enhance the transparency, robustness and reliability of JBA TIBOR, and will implement measures so that JBA TIBOR will remain internationally recognized as a benchmark compliant with the IOSCO Principles and to be widely used as one of the major JPY interest rate benchmarks.