Toshiba Drops Most in a Year as Accounting Probe StartedTakashi Amano and Pavel Alpeyev
Toshiba Corp. fell the most in more than a year after the company said it would appoint a committee to investigate possible problems with its accounting.
The maker of nuclear reactors, chips, appliances and electronics dropped 4.9 percent, the most since Jan. 31, to close at 487 yen in Tokyo.
Toshiba will form a panel to examine the “reasonableness of estimates” when using the percentage-of-completion accounting method for some projects, it said Friday after the market closed. The effect on earnings hasn’t been determined, according to the Tokyo-based company’s statement.
“The announcement doesn’t give us a good impression of Toshiba,” said Yukihiko Shimada, an analyst at SMBC Nikko Securities Inc. “A sense of uncertainty will spread about the credibility of the company’s accounting.”
Toshiba got about 11 percent of operating income from its power and social infrastructure business in the year started April 1, 2013. The investigation will take about a month, the company said.
“Some items in the accounting method for work completed needed to be re-examined,” Naomi Furuya, a spokeswoman for Toshiba, said on Friday. “This was discovered in March in a routine accounting survey.” She declined to give further details.