Accounting Malpractice Leads to Net Loss for Toshiba

Following the July release of an investigation into alleged accounting malpractices (Toshiba CEO Resigns Over Accounting Scandal), Toshiba says it is taking steps to restate past financial results and to finalise its results for fiscal 2014.

Toshiba says it will record a net loss for last year but is yet to determine the extent of the loss. However, the company anticipates ¥127 billion ($1 billion) in write-downs of the value of its nuclear, semiconductor and consumer electronics businesses and expects a further ¥48 billion ($385.9 million) in restructuring and legal costs. For last year, Toshiba expects to record an operating profit of ¥170 billion ($1.3 billion), having originally forecast a profit of ¥330 billion ($2.6 billion). Turnover is expected to rise 2.6% year on year to ¥6.7 trillion ($53.8 billion).

The company has also announced a major shake-up of its board of directors and plans to appoint seven external directors to its new 11-member board, to strengthen its governance structure. One of the appointees has a record on governance reforms, while other directors have legal and accounting expertise.