09 September 2015

Toshiba admits losses after accounting scandal

After coming clean in its twice delayed annual results, it emerges that Toshiba overstated its profits by nearly US$2bn over seven years.

By Bernard Goyder

The company announced in April that it had been facing accounting problems, but the extent was not understood until now Anton Watman

Toshiba re-released a delayed earnings report that finds the company overstated its income by J¥230bn (US$1.9bn) over seven years. The technology and energy conglomerate says it made a net loss in the last financial year of J¥37.8bn (US$300m), having earlier declared it broke even on the year.

Interim CEO Masashi Muromachi, who took over in July following the corruption scandal, has expressed profound regret over the incident.

'The company feels deep remorse and expresses its sincere apologies to shareholders, investors and all other stakeholders for betraying shareholder trust and disrupting the market,' he wrote in the revised earnings statement issued this week. The firm has pledged to reform its corporate culture, toughen compliance procedures and change its accountancy methods in repsonse to the crisis. Sources: Toshiba; Fortune

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