Toshiba increasingly likely to lose listed status as it fails to present audited yearly results

Toshiba’s year keeps going from bad to worse. While the company is now unlikely to go bust (a slim silver lining to some very dark clouds), the Japanese conglomerate is at serious risk of losing its listed status.

Earlier today, the company told shareholders that it would be unable to present them with audited annual business results for the fiscal year ended March, at its general shareholders meeting on June 28. However, the firm is still working around the clock with the independent auditor to file its securities report by the legally specified deadline of June 30. If it fails to meet the end of June deadline without a pre-approved deadline extension then Toshiba’s bourse listing would be put into further jeopardy.

Toshiba has been on the Tokyo stock exchange’s supervision list since mid-March after its nucelear arm Westinghouse declared bankruptcy and losses of around $9 billion were declared. It has also failed to meet several financial report deadlines over the past 12 months and has done little to clear up concerns about its internal controls after a 2015 accounting scandal.

To make matters worse, Toshiba has been at loggerheads with its auditor PricewaterhouseCoopers Aarata since Westinghouse declared bankruptcy. After the auditor refused to sign off the firm’s earnings report in April, Toshiba published an unaudited set of figures in an unprecedented move. 

At the general shareholders meeting on June 28, Toshiba will talk about its earnings outlook, the status of the auditing process and third-party investment in its memory business. While many potential investors have been lined up, Toshiba’s partner Western Digital has thrown any deal into jeaopardy. Western Digital begun legal action to block its partner Toshiba from selling off its profitable chip unit, earlier this month. The US firm has sought an international arbitration to stop any deal going ahead, derailing Toshiba’s plans to recoup a much-needed financial injection. After announcing a multi-billion dollar loss and declaring its nuclear arm Westinghouse bankrupt, Toshiba has been trying to offload its valuable assets.

At its shareholder meeting, Toshiba will also seek shareholder approval of reappointment of incumbent directors, for the period until an extraordinary shareholders meeting to be held later, when the company is prepared to report audited results.

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