“The Company expresses honest apologies to its shareholders, investor and all other stakeholders for any concern or inconvenience caused by the investigation into the Company’s accounting practices”, it said in a statement.
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The Securities and Exchange Surveillance Commission is considering asking the government to impose penalties on Toshiba on suspicion of misstatement, the Yomiuri Shimbun newspaper said.
The probe sets the stage for a restatement of earnings, a board overhaul and potentially hefty fines at the conglomerate in Japan’s biggest corporate scandal in years.
Toshiba, which makes various products from batteries to nuclear reactors, has already admitted that some of its businesses would need to go under the microscope, although the extent of the problems – and who is responsible – remains unclear.
It will say President Hisao Tanaka and his predecessor Norio Sasaki, now serving as vice chairman, bear a heavy responsibility, as they encouraged the accounting irregularities.
“Top officials “received summary reports” from managers on how they were delaying the booking of losses, the investigation source said”.
The report did not mention Fukushima, but said such pressure was particularly strong in fiscal years 2011 and 2012. Those practices are at the heart of Japan’s worst accounting scandal in five years. Prime Minister Shinzo Abe is backing the corporate reform campaign, as he cracks down on misbehaving corporations in a bid to attract desperately needed foreign investment. but we are yet to see any ground breaking revelations.
The revelations shake one of the stalwarts of Japanese industry.
Toshiba’s share price has fallen by 26% since the scandal first surfaced in early April.
Toshiba leaders instructed company executives to delay the reporting of operating losses and costs, setting high targets for operating profits, according to the report by the third-party panel.
Reuters sources claim that the tech giant will be racking up the equivalent of between $2.4 billion and $3.2 billion in charges due to “overstated profits” over the past six years, and this could lead to a very unsafe rollercoaster for the company.
In a positive sign for Toshiba, however, its main lender Sumitomo Mitsui Banking Corp announced that it would continue supporting the company.
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The committee is to hold a news conference at 7 p.m. (11.00 a.m. BST) on Tuesday, according to the filing.
