Toshiba considering second-tier accounting firms as it auditor, to replace PwC Arata

Within less than a year Toshiba has had a turnover of 2 auditors.

Japan’s business daily, the Nikkei has reported that Toshiba Corp will be replacing its auditor PriceWaterhouseCoopers (PwC) Arata. The development comes in the wake of Toshiba struggling to win approval of its full-year financial statement.

Earlier this month, Toshiba had twice delayed the filing of its business results without getting it endorsed from its auditor PwC Aarata, which jeopardized its listing on the Tokyo Stock Exchange.

On April 11, Toshiba’s chief executive Satoshi Tsunakawa had stated at a news conference that there were irreconcilable differences with PwC Arata over the validity of past reports.

When asked on the possibility of changing auditors, the chairman of Toshiba’s audit committee stated, he would like to consider “various options”.

The issue with its auditor revolves around the numbers Toshiba has placed at its U.S. nuclear subsidiary Westinghouse Electric Co, which has seen massive cost overruns at four of its nuclear reactors which are under construction in the United States. These cost overruns have forced the parent Japanese company to post an annual loss of $9 billion and undertake drastic measures.

The company is currently working on its financial statement for 2016-2017. The deadline for filing at the Tokyo Stock Exchange is May 15.

Trouble began in 2015 when Ernst & Young ShinNihon LLC, its auditor at that time, was fined to spot irregularities in an accounting scandal. It was then that Toshiba hired PwC Aarata.

The Nikkei reported Toshiba was scouring for a second-tier accounting firm since the other two names, Deloitte Touche Tohmatsu and KPMG Azsa, have potential conflicts of interest given their past business deals.

Advertisements


Categories: Creativity, Entrepreneurship, HR & Organization, Regulations & Legal, Strategy

Tags: , , , , , , , , , , ,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: