Many companies are not honest with their financial data. Some people still commit fraud today, hoping not to get caught. With all the deceit that has happened in recent years, I decided to research and write about the Toshiba accounting scandal that came to light in 2015. Say no to plagiarism. Get Custom Essay on “Why Violent Video Games Should Not Be Banned”?Get Original EssayToshiba Underestimated Its Profits By More Than $1 Billion. Employees underestimated long-term project costs. In doing so, this allowed Toshiba to overstate its operating profits by at least 1.2 billion between 2008 and 2014. They also had problems with undervalued inventory. Different business divisions were involved in the fraud. Toshiba would record future profits earlier and postpone losses while delaying fees and other similar methods that resulted in exaggerated profits. It turned out that the wrongdoing actually began under former CEO Atsutoshi Nishida in 2008. At that time, there was a whole world. economic crisis which negatively affected Toshiba's profitability. The fraud did not stop under the next CEO, Norio Sasaki, but it eventually ended in scandal under the CEO, Hisao Tanaka. Toshiba's culture was a significant factor in enabling the deceptive accounting practices. Employees cannot go against the requests of their superior because this would not be accepted. The company's management set strict profit targets for different departments, implying that failure would not be accepted. Sometimes goals were set towards the end of the term, when there were only a few days left to achieve those goals. The only way to achieve the set goals was to use irregular accounting techniques. One of the ways Toshiba manipulated profits was by outsourcing computer manufacturing to a partner. They would then sell computer parts to this partner who would then assemble the computers and Toshiba would buy the computers back. Toshiba would sell partners more parts than necessary. In doing so, it increased the company's inventory, which allowed Toshiba to boost its profits. After the fraud was exposed, more than half of the board resigned. Prime Minister Shinzo Abe made a change that requires publicly traded companies in Japan to have at least two independent outside directors on their boards. In the future, Toshiba must learn from its mistakes in order to improve its business and gain people's trust. The objectives set must be achievable and realistic. They can't push employees to perform at a level they can't achieve. By setting them up for failure, Toshiba is also setting up its own company to fail. People make mistakes and may set goals that they believe they can achieve. But when goals are not being met, employees should not be asked to cover up problems and lie. The truth is always better than deception, because it will eventually be revealed. You cannot effectively run a business based on fabrications because it is dishonest and in poor taste. Keep in mind: this is just a sample. Get a personalized article from our expert writers now. Get a Custom Essay One thing other companies can learn from Toshiba's downfall is: An obsession with profit can hurt a company. Profits are essential to the sustainability and development of a business. But the..