Case Study : A Japanese Multinational Conglomerate Corporation

1922 Words 8 Pages
Tobisha, a Japanese multinational conglomerate corporation “that has its hand in everything from installing power lines to supplying iPhone parts (Du),” has recently found itself in a major ethics scandal, as the business was discovered overstating its profits by nearly $2 billion over the course of the past seven years. This accounting scandal came to light in February of 2015 when the Securities and Exchange Surveillance Commission, under the financial watchdog Financial Service Agency, suspected accounting irregularities within the Tobisha Corporation and launched an in-depth investigation. The Japan Times explains the report and what it found: The four-member committee looked into Toshiba’s accounting practices from fiscal 2009 to 2014 and found a series of “inappropriate” accounting entries that showed a staggering $1.2 billion net profit. The report said the firm’s top executives, including Tobisha President Hisao Tanaka and his predecessors Atsutoshi Nishida and Norio Sasaki, were involved in the manipulation and there were no internal systems in place to stop them. The report said the priority for the presidents was to secure profits for each quarter, and thus set high targets, demanding their subordinates improve the company’s results. The business culture at Toshiba did not allow lower-level managers “to go against the bosses,” it said. (Nagata)
The ways by which Toshiba manipulated its’ accounting numbers differed by division. For example, “the report said the…

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