OSAKA (Kyodo) Major frozen food maker Katokichi Co. said Tuesday its group companies inflated sales by a combined 98.5 yen billon in the six-year period to last month by booking fictitious sales among group members.
Katokichi, its subsidiaries and some business partners -- about 30 companies in total -- issued sales slips repeatedly among themselves even though no merchandise was transferred, artificially boosting sales, the firm said.
President Yoshikazu Kato, 71, and Yoshikiyo Kato, 66, a vice president and brother of the president, gave up their posts to take the blame for the accounting fraud, the company said.
Vice President Tetsuji Kanamori, 58, took over as president. He joined Katokichi's board in 2005 after serving in a range of senior posts at Japan Tobacco Inc.
The company earlier set up a committee of lawyers and certified public accountants to look into its sales during the six-year period.
Katokichi said it will correct the financial statements for the six years in accordance with the committee's findings.
The panel concluded that a board member who headed the firm's division in charge of marine products operations played a leading role in conducting the bulk of the fake deals. The executive also stepped down Tuesday.
The panel attributed the fabrications to the company's corporate culture, which put excessive emphasis on increasing sales, as well as the domineering management of founder Yoshikazu Kato.