There are many companies that are not honest with their financial data. Some still commit fraud today hoping not to get caught. Despite all the deception that has happened in recent years, I decided to research and write about the Toshiba accounting scandal discovered in 2015. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get original essayToshiba understated its profits by more than $1 billion. Employees underestimated the costs of long-term projects. By doing so, it allowed Toshiba to overstate operating profits by at least 1.2 billion between 2008 and 2014. They also had problems with inadequately valued inventory. Various company departments were involved in the fraud. Toshiba booked future profits in advance and rejected losses, while simultaneously rejecting expenses along with other similar methods that led to exaggerated profits. It turned out that the wrongdoing actually started under former CEO Atsutoshi Nishida in 2008. At the time, there was an economic crisis that was negatively affecting Toshiba's profitability. The fraud did not stop under the next CEO, Norio Sasaki, but eventually ended in scandal under the CEO, Hisao Tanaka. Toshiba's culture was a major factor in allowing deceptive accounting practices. Employees could not oppose their superior's requests because these would not have been accepted. Company leadership gave strict profit targets to different departments with the implication that failure would not be accepted. Sometimes goals were set towards the end of the quarter and there were only a few days left to achieve them. The only way to meet the set goals was through the use of irregular accounting techniques. One of the ways Toshiba manipulated profits was by outsourcing computer manufacturing to a partner. They would then sell the computer parts to that partner who would then assemble the computers and Toshiba would buy the computers back. Toshiba would sell partners additional parts than needed. By doing so, it boosted the company's inventory, allowing Toshiba to inflate its profits. After the fraud came to light, more than half of the board resigned. Prime Minister Shinzo Abe has made a change requiring publicly traded companies in Japan to have at least two independent outside directors on their board of directors. In the future, Toshiba will have to learn from its mistakes to improve its company and gain people's trust. The objectives set must be achievable and realistic. They can't push employees to reach a level they can't reach. By setting them up for failure, Toshiba is also setting up its own company for failure. People make mistakes and may set goals that they believe can be achieved. But when goals are not achieved, employees should not be asked to hide problems and lie. The truth is always better than being deceptive as it will eventually be exposed. You cannot effectively run a business based on inventions as it is dishonest and distasteful. Please note: this is just an example. Get a custom paper from our expert writers now. Get a Custom Essay One thing other companies can learn from Toshiba's fall is what an obsession with profits can do for a company. Profits are fundamental to the continuity and development of a company. But the attraction of achieving short-term profit goals provides an environment for accounting manipulation. Other companies can learn from the fact that even a giant like Toshiba does not.