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More accounting errors as Toshiba delays results
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TOSHIBA Corp again delayed announcing its annual financial results yesterday, as new accounting errors prevented the company from drawing a line under Japan’s worst corporate scandal in four years.
Toshiba, which was scheduled to post its earnings for the business year ended in March, said the newly discovered problems included incorrect impairment charges on fixed assets at several subsidiaries and improperly timed booking of loss provisions at a US subsidiary.
“We deeply apologize for the situation we are in yet again, and for the inconvenience and concern we have caused to our stakeholders including shareholders and investors,” Chief Executive Masashi Muromachi said before making a deep bow of contrition to a packed, late-night news conference.
The laptops-to-nuclear conglomerate had already delayed announcing its results by around three months due to an independent investigation over its past accounting practices.
That probe found Toshiba had overstated past results by around US$1.2 billion over several years, prompting its then-CEO and several other executives to step down last month. It is Japan’s biggest accounting scandal since 2011 when Olympus Corp was found to be involved in a US$1.7 billion scheme to conceal two decades of investment losses.
Toshiba said government regulators accepted its request for extension and that it plans to submit the results by September 7.
Muromachi declined to say how much the newfound errors were worth but said they were “not huge.”
Toshiba found some 10 new cases of accounting errors stretching back to around 2010, although these will not drastically affect Toshiba’s forecast for an operating profit of 170 billion yen (US$1.4 billion) for last fiscal year, Muromachi said. He said the US unit named in the new disclosure was not Toshiba’s Westinghouse nuclear business. Investors have speculated the company might need to reassess the value of that business due to a downturn in nuclear energy demand.
The CEO said Toshiba should be able to meet the new deadline for closing its books but that if not, “I would have to consider taking responsibility, including resignation, if needed.”
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