"Understood. The Finance Departnt has already prepared the transaction plan. We will disperse the operations through several offshore accounts, so it won't arouse market suspicion," Frank replied.
"How are the negotiations for the DND license going with Tom?"
"Almost there. TSR Corporation's financial situation hasn't been great lately, and they are in urgent need of cash flow. As long as we offer the right price, they are willing to grant the exclusive online ga adaptation rights."
"Excellent. Get the DND project initiated. Base the technical architecture directly on the Win95 32-bit environnt. We need to beat everyone else to the punch and lock hardcore gars into our community."
Frank hung up the phone and finished the coffee in his cup.
He walked over to the office area and clapped his hands.
"Guys, stop what you're doing for ten minutes. We're having a short eting," he said, looking at the engineers who were staring at their screens. "It's about how we will transition to full-scale developnt on the Win95 platform. We are about to face a great storm."
Tokyo, Sega Headquarters.
Takuya Nakayama hung up the phone.
Spread out on his desk was a copy of "A Detailed Guide to Japanese Tax Law."
The external environnt was turbulent, and his top priority now was to straighten out Sega's internal ledgers.
Director Hoshino pushed open the door, holding a fax in his hand.
"The arrival ti for the PricewaterhouseCoopers New York team has been confird," Director Hoshino said, handing him the fax. "They are flying directly to Tokyo this coming Monday. They require us to have the detailed accounts of all major overseas clients from the past three years ready."
Takuya Nakayama took the fax and glanced at it. "How is Yoshimura reacting?"
"The Sales Departnt has been frantically collecting paynts for the past two days. Several regional managers have been calling distributors in North Arica all night," Director Hoshino reported. "No one wants to have a pile of bad debts on the books when the North Arican team arrives."
"That is the power of deterrence," Takuya Nakayama said, sliding the fax under a book. "How are the discussions with the Board of Directors regarding the dual-track audit proposal going?"
"A few of the older directors were hesitant at first, feeling that the extra consulting fee each year wasn't cost-effective. After they read the 'Preliminary Assessnt Report on Accounts Receivable Risks' you compiled, they changed their minds. Nobody wants to see Sega's profits exist only on paper."
"The regular board eting is next Monday," Takuya Nakayama instructed. "Have the PwC team make their appearance directly at the eting. I want everyone to understand that the rules at Sega have changed."
Director Hoshino nodded in acknowledgnt and turned to leave the office.
The new week arrived.
In the top-floor conference room of Sega's headquarters building in Ota Ward, Tokyo, the mbers of the board took their seats.
Cool air from the overhead vents blew, rustling the quarterly financial reports neatly arranged on the long mahogany conference table.
Takuya Nakayama sat to the left at the head of the table.
Director Hoshino sat next to him, head bowed as he flipped through a thick, bound docunt.
The first half of the eting consisted of routine reports from various departnts.
When it was Takuya Nakayama's turn to speak, he set down his fountain pen and folded his hands on the table.
"Everyone, over the past two months, thanks to the trust of the President and the support of all of you, I have been overseeing both Sales and Finance. I would like to take this opportunity to report to the board on my initial findings."
The conference room fell silent.
The directors stopped their conversations and looked toward the young Executive Managing Director.
"Let's start with the Sales Headquarters," Takuya Nakayama said in a calm tone. "The team led by Departnt Head Yoshimura is highly motivated. During this period, not only have they been pushing to et their performance targets, but they have also proactively added a review of risk factors to their routine summary work."
Director Suzuki, the veteran sitting opposite him, picked up his teacup and took a sip of hot tea. "Yoshimura has been with Sega for fifteen years; he is mature and prudent. It's a good thing he can proactively manage risks."
"Indeed. What's even more comndable is that the Sales Departnt hasn't beco conservative just because they've identified these risks," Nakayama continued, following Suzuki's lead. "They have actively adjusted their strategies and direction while maintaining their full drive. The expansion of distributors in the North Arican and European regions is proceeding right on schedule."
These words gave the Sales Departnt plenty of face and served as a disguised form of appeasent.
Just a while ago, he had bypassed the chain of command to audit their accounts and made phone calls to interrogate them, putting the Sales Departnt through hell.
Praising them so effusively at today's board eting was his way of offering a carrot after the stick.
Director Hoshino, sitting to the side, flipped a page of his docunt without even lifting his eyelids, rolling his eyes in his heart.
Among the directors present, he was the only one who truly knew what Nakayama had actually encountered.
Those so-called "proactive risk assessnts" were all forced out by the Managing Director's relentless, life-chasing phone calls.
If it weren't for Takuya Nakayama holding them by the throat with recovery rates and bad debt provisions, Yoshimura and his gang would still be frantically stuffing products into distributors' warehouses just to secure their bonuses.
The other directors, unaware of the truth, nodded in succession, expressing their approval of the Sales Departnt's performance.
A sales team that could both identify problems and maintain a sense of ambition was exactly what the board wanted to see.
Next, Takuya Nakayama steered the topic toward finance.
"Regarding finance, I have reviewed the audit reports and working papers from the past few years. To be honest, I am not from a finance or accounting background, and I've mainly been playing catch-up for these past two months."
He reached out and patted the two thick books beside him: Modern Corporate Financial Managent and Principles of Auditing.
"I am still in the learning stage, so it wouldn't be realistic to claim that soone with my half-baked level of knowledge could spot any major issues in the ledgers."
A faint chuckle rippled through the boardroom.
The expressions of several veteran directors relaxed.
They had been worried that this young, fast-acting Managing Director would stir up more trouble in the finance departnt.
Takuya Nakayama conveniently omitted his recent "leapfrog" operations, where he bypassed protocol to directly obtain materials from junior staff under the guise of seeking guidance.
After the laughter subsided, Takuya Nakayama brought up the core issue of the day.
"However, the more I read, the more questions I have. I have developed so concerns regarding the current auditing system of Japanese accounting firms."
He scanned the conference table.
"Sega's operations are now spread very wide. With tens of billions of yen flowing across North Arica, Europe, and China, is it really safe enough to rely solely on a single standardized audit report from ChuoAoyama Audit Corporation every year? I don't an to distrust my colleagues in the Finance Departnt, much less question the judgnt of those present here."
Takuya Nakayama raised a finger.
"As business scales up, those down the line might choose to 'technically adjust' the books to pad performance or cover up minor errors. This is a weakness of human nature. Without strong, external cross-supervision, these minor errors could snowball into massive holes. By the ti the problems erupt, it will be too late for the Board to redy them. We must ensure that the corporate operational information received by the directors is true, accurate, and unprocessed at the ground level."
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