Japanese multinational conglomerate Toshiba Corporation will reportedly admit to a huge 550 billion Yen ($4.5 billion) loss, thanks to an accounting scandal that came to light earlier this year, whereby the company allegedly declared false profits to the tune of $1.2 billion over the past six years, in a bid to meet internal targets. The fraudulent accounting practices have already resulted in the exit of a number of top-level executives including former CEO and President, Mr. Hisao Tanaka, along with at least two other high-level executives at the company. Under incumbent chief executive Mr. Masashi Muromachi, the electronics giant will now attempt to regain the trust of its investors and recover from the major accounting fraud, which reportedly started just after the financial crash seven years ago.
With repercussions of the scandal still being felt far and wide, the company has now further announced that as part of a restructuring process, it will cut as many as 6,800 jobs from its consumer electronics division by March, next year. The number represents a whopping thirty percent of the total number of workers in its 'Lifestyle division', which is how Toshiba describes its consumer electronics business unit. The company employs as many as 200,000 people globally, making it one of the largest conglomerates to be based out of Japan. According to the BBC, Toshiba is handicapped by not just the accounting fraud, but also by the Tsunami that struck Japan back in 2011, which resulted in the much-publicized leakage from the nuclear power plant at Fukushima, which was being operated by Toshiba at that stage. The company is now decommissioning the power plant with Hitachi and a few other companies. Financial losses from that disaster are apparently yet to be accounted for on Toshiba's balance sheet.
Coming to some more details about the ongoing restructuring at the beleaguered technology company, Toshiba will reportedly sell off its TV and washing machine factories to Hong Kong-based partner Skyworth. The company has already sold its image sensor business to fellow Japanese multinational tech giant Sony, and has decided to get out of the TV manufacturing business for the US market. Toshiba-branded television sets to be sold in the US will henceforth be manufactured by Taiwanese contract manufacturer Compal Electronics, under license from the Japanese company. Toshiba apparently is also looking to merge a number of its other consumer tech units with those of its rivals, according to various reports doing the rounds. The company's PC-making unit may merge with Fujitsu and Vaio, and its appliance business may come together with that of Sharp's, but nothing has been announced officially on either front just as yet.