UPDATE2: Toshiba's alleged improper inner control delays earnings release


Toshiba Corp. said Tuesday it found "inappropriate pressure" at its U.S. unit over the purchase of another U.S. company, prompting it to delay the release of its financial results for the nine months through December.

The 140-year-old nuclear and electronics conglomerate, already working to put an accounting scandal behind it, postponed the release scheduled for Tuesday to March 14 at the latest.

However, the company released preliminary results on an unaudited basis. It estimates a group net loss of 500 billion yen ($4.40 billion) for the April-December period, which includes a loss of 712.5 billion yen from its U.S. nuclear business.

Toshiba also expects a group net loss of 390 billion yen for the full year through March 31, rather than a 145 billion yen profit as estimated previously.

Toshiba said a whistleblower had pointed out in January an internal control deficiency at its U.S. nuclear unit Westinghouse Electric Co. over the acquisition of CB&I Stone & Webster, a U.S. nuclear plant construction company.

Its auditor then asked Toshiba to investigate the matter and, if true, to assess the impact on its earnings of the alleged improper pressure by part of Westinghouse's management, Toshiba said.

"Internal reports were made...that suggested that internal controls related to the purchase price allocation process for Westinghouse's acquisition of CB&I Stone & Webster were inadequate," Toshiba said.

Westinghouse, which bought CB&I Stone & Webster in late 2015, has already been a cause of a massive loss in the nuclear power business.

The delay in the release of its financial results briefly pushed Toshiba's stock down more than 9 percent trading Tuesday on the Tokyo stock market.

Toshiba, which had been focusing on nuclear power as a growth driver, has struggled to secure orders as demand for nuclear power plants has slowed since the 2011 Fukushima nuclear disaster.


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