Toshiba execs quit over scandal
TOSHIBA president Hisao Tanaka and two other executives quit to take responsibility for a $1.2 billion (R15bn) accounting scandal that caused the company to restate earnings for more than six years.
Norio Sasaki, the vice-chairman, and former president Atsutoshi Nishida, had also resigned, the company said yesterday, more than two months after the company announced it was investigating possible accounting irregularities. The maker of nuclear reactors, chips and appliances said earlier in the day it would correct earnings by at least ¥152bn (R15bn), based on the results of a third-party investigation of its books.
The resignations come after the third-party report showed the company’s top executives had set unrealistic profit targets that had systematically led to flawed accounting.
Chairman Masashi Muromachi would take over as the interim president, Toshiba said. The company will announce a new management team next month and will file its financial year 2014 earnings at the end of next month.
The accounting irregularities were “skillfully” hidden from outside observers, according to the third-party probe report.
No charges have been filed against Toshiba or its executives in the case.
Toshiba, a more than 140year-old pillar of Japan Inc with businesses spanning nuclear reactors to memory chips, is caught up in the country’s biggest accounting scandal since 2011.
Tanaka and Sasaki, who between them have led the company for the past six years, sought to delay booking losses and employees were unable to go against management orders, according to the report.
“The amount of fraudulent profits, the involvement of top management and their subsequent resignation have already been priced in,” said Naoki Fujiwara, a Tokyo-based chief fund manager at Shinkin Asset Management. “If the management structure responsible for this is renewed and dealt with accordingly, things will return to normal.”