crime

Toshiba medical unit boss fired over accounting fraud

9 Comments

Toshiba said Wednesday it had fired a renegade manager for falsely inflating profits at a medical subsidiary, and that the unit's chief executive would quit.

The Japanese engineering conglomerate said the unnamed employee had "overstated numbers and made misstatements" in what it described as "inappropriate" accounting at Toshiba Medical Information Systems.

The false accounting happened over a six-year period starting in 2006, the conglomerate said, adding that it inflated the division's profits by about 9.86 billion yen in total.

In response, a manager who ordered his underling to fake the financial statements was fired while the unit's chief executive and directors have agreed to step down, Toshiba said.

"Toshiba Corporation deeply regrets that such a situation has occurred...and is taking the matter very seriously," it added, saying it would take "preventative measures" to prevent a re-occurence.

However, the vast company said it did not expect the scheme to "materially affect its consolidated financial results for the past fiscal years".

The revelation came as Toshiba said its net profit for the six months to September fell 14.4% to 21.5 billion yen due to a tax change.

Operating profit soared 53.7% to 105.6 billion yen on sales of 3.04 trillion yen, up 13.2%, it added, crediting strong sales of electronic devices and memory chips.

The firm boosted its annual sales forecast by 200 billion yen to 6.3 trillion yen, with a net profit of 100 billion yen.

© (c) 2013 AFP

©2021 GPlusMedia Inc.

9 Comments
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Should have stuck to the two-year tenkin cycle?

1 ( +1 / -0 )

renegade manager

Yeah right, not in Japan.

1 ( +1 / -0 )

However, the vast company said it did not expect the scheme to “materially affect its consolidated financial results for the past fiscal years”.

That's unfortunate, since it might have provided a good "buy" opportunity.

0 ( +0 / -0 )

i Got it say this since the poster have not yet say anything.

hahahaha

One answer fits all situations for Japan.

This is most " regretable" but I'm sure they will " sincerely reflect on the situation", "collect all relevant information swiftly " and "take appropriate action speedily ", "to avoid public confusion" - like form an expert panel.

3 ( +3 / -0 )

Ah yes, let's go down the Japan Inc. corporate fraud checklist, shall we?

Tactile wording: "made missatements" and "inappropriate accounting", (both easily replaceable with "illegal") - CHECK

Express "regret" - CHECK

Ensure the public that it's "a serious matter" - CHECK

Mention future "preventitive" action - CHECK

Voluntary step-downs by executives to dodge jail time - CHECK

Round and round we go! Which conglomerate will be next!

0 ( +0 / -0 )

This is internal events in Toshiba, with falsified profit statement by its employees. The punishment seemed fired, etc. Jail time enforcing law agency can not arrest any of them. Regret is a proper attitude by Toshiba. It can not say what Toshiba feel such as " We admire these employees" or "We are glad inflated report became public", etc. when Toshiba wanted to stop such false revenue report when Toshiba is doing something Olympus pioneered in Medical camera industry years ago after we only had X-rays to look inside of our body. . The culpit did not steal money as their positions are not in accounting dept. All Toshiba could do was firing culpit and this guy's superior to lose their position even superior did not create false report. If you work for any company with suoervisory position, be careful of the activities of your subordinates. .

-1 ( +0 / -1 )

Well, is sure sounds like typical Japanese accounting practice enjoyed by major companies in Japan. I don't think one can find an accurate financial report on a Japanese companies. If you ask three accounting firms to perform a separate review of the same company, you will and I will guarantee, three different outcome.

-1 ( +0 / -1 )

It was not in accounting dept. Accounting dept must have reported his report as fake. Acct. Dept complained, I;d bet, Addtg dept usually prepare data and other dept relase how good it did or not based on data received from Acctg Dept. That is why culpit was fired and his hanchos were punished. Acctg dept did not prepare this report. Big company like Toshiba has so many depts in acctg division. It is not like a small mama-papa shops. Divisions and depts under each divisions. It does not use acctg firms. 3 different acctg firms? Try to hire by payin more than million dollars each. It is not mama-papa shop. Toshiba is only one of companies under Mitsui umbrella. Again it is not papa mama store.

0 ( +0 / -0 )

Cooking the books is never a good thing, especially when the name is Toshiba.

0 ( +0 / -0 )

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