Toshiba CEO to resign over accounting scandal

Third-party panel investigating Japanese conglomerate expected to find accounting irregularities ‘intentional,’ reports say

Photo by: Reuters
Photo by: Reuters

Updated Jul 28, 2015

Toshiba CEO Hisao Tanaka and other board members including Vice Chairman Norio Sasaki will step down in September over accounting irregularities, media reports have said.

Sources declining to be named told Reuters that over the half of the board is expected to be replaced at the next shareholders’ meeting in September.

Tanaka announced his intention to step down to his close circle on Tuesday, the Nikkei business daily has reported.

Tanaka was among top executives in the company who allegedly urged subordinates to “delay timing” of booking losses in its infrastructure business, the Nikkei said. 

According to reports from AsiaOne Business, the third-party panel investigating the Japanese conglomerate is expected to note the accounting irregularities were “intentional” and the company preferred bookkeeping methods that would overstate profits.

“The panel is therefore set to conclude in its report that Toshiba's bookkeeping was an act of "fraud,” the news and lifestyle aggregator said.  

Toshiba reported accounting irregularities in early April, two months after a report requested by financial regulators was due.

While the manufacturing company hired a third-party panel to investigate these irregularities, it hasn’t close its books for the past financial year or suspended its year-end dividend.

Investigators mainly appear to believe that Toshiba’s executives resorted to understating costs and overestimating revenue to hide the impact of the 2011 Fukushima disaster on its nuclear division, the Reuters has said, citing anonymous sources. 

TRTWorld and agencies