Chief executive Hisao Tanaka has resigned after it emerged the company overstated its profits for the past six years by a total of 151.8 billion yen (£780 million).
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Along with Tanaka, his predecessors Vice Chairman Norio Sasaki and adviser Atsutoshi Nishida also resigned to take responsibility for accounting irregularities that occurred under their watch.
“(Toshiba) decided to sell the shares in order to utilise the company’s group assets and improve its balance sheet”, it said.
According to a report submitted by the third-party panel earlier this week, Toshiba overstated pretax profits by ¥156.2 billion for the April 2008-December 2014 period in its infrastructure, semiconductor, personal computer and other mainstay businesses.
The findings are expected to lead to the restatement of earnings and potentially hefty fines in Japan’s worst boardroom scandal since Olympus Corp. was found to have covered up $1.7 billion in losses.
Toshiba first flagged potential accounting irregularities in May.
Aso declined to comment when asked if Toshiba would face any kind of financial penalty.
The company is dismissing accusations that its accounting practices stemmed from the company’s faltering nuclear business.
Shares in Toshiba (TOSBF) rose 6 percent Tuesday on relief the report had few nasty surprises.
But it said that the Toshiba stock disposal “has no other effect on the strategic alliance between” the two companies. The Toshiba panel, headed by a former Tokyo prosecutor, painted the picture of a corporate culture where underlings couldn’t challenge powerful bosses who were intent on boosting profits at nearly any cost.
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-Taiga Uranaka, Chang-Ran Kim and Ayai Tomisawa contributed reporting.
