Toshiba president falls on his sword

Hisao Tanaka has announced his resignation as president at Toshiba following his admission earlier today that the tech-giant overstated more than ¥150 billion in profits.
Written by Asha Barbaschow, Contributor

Toshiba president Hisao Tanaka and his predecessor Norio Sasaki have quit in the wake of a ¥150 billion accounting scandal blamed on management's overzealous pursuit of profit.

The two men were among eight high-level executives at the sprawling Japanese conglomerate to take the fall on Tuesday afternoon, resigning after an independent report found senior management complicit in a years-long scheme to pad profits.

"It has been revealed there has been inappropriate accounting going on for a long time, and we deeply apologise for causing this serious trouble for shareholders and other stakeholders," Toshiba said in a statement.

"Because of this Hisao Tanaka, our company president, and Norio Sasaki, our company's vice chairman ... will resign today."

Chairman Masashi Muromachi will take over as president in the interim.

The report presented Toshiba with a rebalanced seven-year earnings sheet, showing that cooked FY2008 and FY2009, as well as FY2011 through FY2014 results have all contributed to the ¥150 billion overstatement of profits. In FY2012, the company allegedly added ¥85 billion to its year end earnings.

On Tuesday morning, Tanaka issued a statement apologising to shareholders, investors, and stakeholders for the overstatement.

Toshiba has said that it will take procedures to correct past financial results "as necessary", saying it will verify yearly results, run its findings through the company's auditors Ernst & Young ShinNihon, and report as required.

Tanaka, 64, and Sasaki, 66, both joined Toshiba in the early seventies.

Sasaki served as Toshiba president between June 2009 and June 2013, covering most of the period during which the company inflated the profits.

With AAP

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