Japan's Toshiba Corp announced a $5.9 billion asset sale and a big investment in its chip business on Thursday. But the company saw its shares slide on a report that the U.S. authorities were probing accounting linked to its Westinghouse nuclear power unit.
According to Reuters, the electronics company has been very keen to put last year's $1.3 billion accounting scandal in the past and move on with streamlining its blown up businesses. Its poor performances over the years have been allegedly masked by false bookkeeping.
Toshiba Chief Executive Masashi Muromachi, who has already declared more than 10,000 jobs cuts, is to disclose a new business approach on Friday. But he stated that he is most likely to spend much of his time fielding questions about the outcome from its accounting despair.
Bloomberg reported that the Justice Department and the Securities and Exchange Commission are investigating whether the fraud was committed. The investigations follow one by Japan's securities regulator, which discovered that Toshiba forged financial statements and documents linked to its issuance of corporate bonds.
U.S. authorities are also examining accusations made in an internal review published last year by the Tokyo-based Corporation. The report, which is a 334-page version of which was published in English on Toshiba's website in December, stated that the management was complicit in padding the profits for almost seven years. The situation resulted with the resignations of chief officials, including Hisao Tanaka, Toshiba's President and Chief Executive Officer.
The Tokyo-based company's nuclear energy unit faces trouble over the company's downfall in March 2011 at a plant in Fukushima, North-eastern Japan. This was after a massive earthquake and tsunami affected the company.
"Certain Toshiba U.S. subsidiaries received information requests from the DOJ (Department of Justice) and the SEC (Securities and Exchange Commission) in respect of Toshiba's accounting practices, and they are cooperating with the investigation," Toshiba said in a statement.
Toshiba's share price took a hit when the probe made the headlines, but Japan's corporation's shares were trading up to 2.5 percent by mid afternoon in Tokyo on Friday. Toshiba is involved in a scandal over admissions that the company officials falsified its accounting books for years after setting unrealistic earning targets, as claimed by USA TODAY.
Meanwhile, the Justice Department and SEC have not unveiled details of their investigation. Japanese media reported that the questions could be over the accounting at Toshiba's subsidiary Westinghouse Electric Co, but the Westinghouse issued a heated statement on its website denying that Toshiba was under enquiry.
