Toshiba's chief executive and president Hisao Tanaka Resigns over accounting fraud

 

Toshiba's chief executive and president Hisao Tanaka has resigned after the company said it had overstated its profits for the past six years.

He will be succeeded by chairman Masashi Muromachi, with vice-chairman Norio Sasaki also stepping down.

On Monday July 20,2015, an independent panel appointed by Toshiba said the firm had overstated its operating profit by a total of 151.8bn yen ($1.22bn, £780m).

The overstatement was roughly triple an initial estimate by Toshiba.

The company's business empire stretches from home electronics to nuclear power stations.

Toshiba's accounting scandal began when securities regulators uncovered problems as they probed the company's balance sheet earlier this year.

One line that the investigators looked into was that executives set unrealistic targets for new operations after worries that the 2011 Fukushima disaster may hit Toshiba's nuclear division.

While the report did not specifically refer to Fukushima, it did say that pressure within Toshiba was strong in the accounting years of 2011 and 2012.

The findings mean Toshiba will have to restate its profits for the period between April 2008 and March 2014. It is unclear whether it will affect the company's results for the year ending March 2015.

The finance minister, Taro Aso, said the case could undermine confidence in corporate governance in Japan.