Sanyo being investigated for possible accounting fraud

Japanese authorities are looking into the accounting practices of Sanyo Electric Co. The Securities and Exchange Surveillance Committee is investigating the company for allegedly misrepresenting losses in its results for the fiscal year ended March 2004. Sanyo had ?190 billion ($1.56 billion) in losses to book, but only booked ?50 billion of losses for that year. The unbooked losses would have left Sanyo with a net loss for the year.

This is having an impact on investors, particularly Goldman Sachs, which invested over $1 billion and was reportedly planning on selling soon at a big profit. The stock was down 21% in Tokyo. The company also faces possible delisting on the stock exchange.

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