Toshiba Wins Auditor Sign-Off, Likely Avoiding Delisting for Now

Share

Since taking over as Toshiba's auditor in June previous year, PricewaterhouseCoopers Aarata (PwC) has yet to endorse the firm's financial results which have suffered numerous delays.

However, auditor PricewaterhouseCoopers Aarata issued a qualified opinion on Toshiba's statements yesterday.

There had been growing worries that cash-strapped Toshiba may not make yesterday's deadline to supply financial statements for the fiscal year ended in March, as it was at odds with its auditor over multi-billion dollar losses at Westinghouse.

"It's still hard to say that Toshiba has taken a huge step forward", said Masahiko Ishino, an analyst at Tokai Tokyo Research Center.

Toshiba had been debating with PwC Arata over when the Japanese company realized massive losses on a USA nuclear power unit. It had released preliminary earnings earlier, without the approval, to stave off delisting, although the company was later moved to the Tokyo Stock Exchange's second section from its first section.

While agreeing generally with the financial results of Toshiba, the sign off from PwC did come with a caveat.

The bourse is now reviewing Toshiba's governance to decide whether the firm can stay listed. The auditors have already provided their opinion about the dark future of the organization and said that the delisting got delayed due to PwC signed-off. The U.S. company filed for bankruptcy protection in March.

Toshiba has met a deadline to report its long-awaited earnings results, reducing the risk that the firm will be delisted from the Tokyo Stock Exchange. A legal spat with the joint venture partner Western Digital Corp., which claims that any sale without its consent breaches their joint venture contract, also continues to loom over the sale process. Toshiba has a history of being in existence for more than 140 years and this delisting would have worsened the condition for the company to raise cash for their memory chip business which is now suffering a huge cash crunch. "I can't imagine that anybody is going to pay real money for these assets until the legal situation has been made clear", Givens said, warning that the sale process would likely be paralyzed indefinitely as a result.

Share