The Accounting Scandal in Toshiba Research Assignment

The Accounting Scandal in Toshiba
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Introduction
Japan is often famed for its embracement of technology and industrialization. It has companies that are leading in telecommunications, automobiles as well as energy. Toshiba is one of Japan’s leading corporations well known for their electrical products. For many years the company has been conducting its business in best ways, and it was even ranked ninth among the companies in Japan with good governance. In the year 2015 however, the company was involved in one of the most unethical business conducts. The company’s accounting department went ahead to make some accounting adjustments that were four times more than the actual figures.
As a result of the scandal, some of the senior employees in the company lost their jobs. Like many other leading companies whose focus is on making large profits Toshiba’s aim was to make profits and in return look very good to their customers and potential investors. In one of the largest accounting scandals in Japan, the company tried its best to paint the picture that all was rosy, and yet deep down, everything was absolutely opposite. This façade would soon come tumbling down as the reality of the rot came to the public limelight.
Ethical Responsibilities
Ethics are a set of expectations which set certain standards of operation for everyone. Adhering strictly to the set moral code of conducts significantly contributes to the success of many businesses. In the case of Toshiba, however, there was a significant failure of business ethics. When doing business, some actions should never be performed however beneficial they may be to the company. Due process needs to be followed when carrying out any set of duties under an organization. Such due processes in most cases entail having policies, goals and objectives to follow. These three are laid down by the organization itself. The senior employees in the company were left with the responsibilities of ensuring that the right accounting procedures were used in the processes and also that the results given to all the stake holders are accurate (Rowley & Oh 2016). It was not the case however as the results given out to the public in the company were inaccurate.
It is the responsibility of all employees to act in a manner that is ethically right to avoid having very many problems that may damage the reputation of the company. The senior employees of Toshiba imposed a lot of pressure to the other employees, and this was what triggered them to fake numbers that would prove that the company was doing well although it was not. It is a clear indication that the organization was not lead by example and there is also fear among the employees.
The top management would have ensured that all the businesses of the company were conducted in a morally right manner and also corrected the mistakes early enough. The employee’s at Toshiba are forced to do things that are not right by their superiors, and the consequences are costly. The workers are also denied the freedom to express themselves on various issues as all the decisions are made by their superiors. A big company like Toshiba should have put in place a committee of experts responsible for monitoring the ethical conducts of every individual to avoid the mistakes that happened.
While much of the blame can be directed towards the management and staff, it is also worth noting that the auditors might have played a part in orchestrating the malpractice. The scandal involved overstatement of profits in some cases, and compression of losses in some. In a nutshell, it entailed manipulation of the books of account to display false information of a robust company. This should have been easily detected by auditors. Well, unless they detected it but also swept it under the carpet. In the end, there was collusion between the staff and the auditors to the act.
Legal Responsibilities
All organizations need to ensure that they are aware of all the existing laws in the places where they operate their businesses. It is such laws that usually try to provide a level playing ground for all the organizations, thereby helping to curtail unethical practices. Failure by organizations to comply with the set laws can negatively affect the business. In the case of Toshiba there various activities that were carried out by the superiors and the other employees and are against the set laws and regulations.
The adjusting of the accounting figures meant that some of the company’s laws were violated. Companies need to be transparent in all their operations to ensure that all the parties involved have no doubts. All the legal paperwork should be done by an expert and at the right time. Illegal activities made the company experienced massive losses which...