Japanese electronics company Toshiba has avoided being delisted from the Tokyo Stock Exchange after auditors from PwC Arata signed off its accounts, allowing it to publish its 2016 annual report
Arata gave its qualified opinion as it had limited information on certain accounting issues, while it also said comparing figures with corresponding periods in previous years could lead to errors.
‘Toshiba understands this to mean that no issues exist in respect of accepting the financial statements for the second quarter of FY2017 and beyond and it has returned to normality,’ the auditor report said.
The company has taken a $6.3bn (£4.88bn) writedown on its US nuclear subsidiary, Westinghouse Electric Company, which filed for Chapter 11 bankruptcy protection in late March.
The auditor’s report added over the course of the seven months since December 2016, Toshiba has conducted numerous investigations with independent third party experts into the timing of the recognition of the loss in relation to CB&I Stone & Webster by Westinghouse. As a result, no evidence was found that Toshiba or Westinghouse could have recognised the loss at any time prior to the third quarter of 2016.
Toshiba has already been through a $1.3bn accounting scandal in 2015, as a result it replaced EY ShinNihon as its auditors with PwC Arata. Media reports suggest the company is now looking for a mid-tier auditor to take over, as it cannot reconcile its differences with PwC, and Deloitte Touche Tohmatsu and KPMG Azsa, the other two of the Big Four, faced potential conflicts of interest due to past business deals.
Toshiba’s annual report for 2016 is here.
PwC Arata’s auditor report is here.
