Toshiba Corporation – How Could So Much Be So Wrong?

• In Event: Case Studies in Fraud and Forensic Accounting 2

Abstract

This case introduces students to the fraudulent acts committed by Toshiba Corporation over a seven year period from 2008 to 2014. The case objectives involve a review of the accounting frauds that occurred at Toshiba and the environment that encouraged employees to take the unlawful actions. Areas reviewed include percentage of completion accounting for long term contracts, inventory channel stuffing, and early booking of sales. The case’s three main objectives are to: understand definitions of fraud and corporate governance, their differences and interrelationship: to have students develop critical thinking skills to determine how the frauds were committed; and to develop business writing and public speaking skills. This case can be used in a fraud, forensic, auditing or international accounting class to introduce the students to the study of how companies committed fraud in violation of the law but in accordance with cultural norms. It can also be used to cover ethics, governance and accountability.

Authors

• Priscilla A Burnaby, Bentley University

• Susan Hass, Simmons College