Japanese firm in £1bn accounting scandal

Japan has been hit by one of its biggest accounting scandals after cosmetics company Kanebo admitted it had booked £1bn of fictitious profits in its accounts.

The company is now planning to file criminal complaints against former management and will sue for damages, The Times reports.

The details emerged when Kanebo released corrected financial reports, where it was revealed that the company had hidden a negative net worth from 1995 to 2003 by inflating sales and under-reporting expenses.

The Tokyo Stock Exchange suggested it may review the company’s listing in the wake of the scandal and Kanebo shares plummeted 13% to reach a four-month low.

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