• Kyodo

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Toshiba Corp. said Tuesday it is likely to have fallen into the red in the business year that ended March due to losses and a reduction in asset values resulting from its correction of past earnings, after a widespread accounting scandal forced it to withdraw its previous estimate.

It also announced on Tuesday a new management lineup to bolster corporate governance, naming seven outside directors, up from four before the scandal surfaced.

President Masashi Muromachi, who assumed the post following the resignation in July of Hisao Tanaka, will stay at the helm of the conglomerate.

New board members will include Koichi Ikeda, former president of Asahi Breweries Ltd., Yoshimitsu Kobayashi, former president at Mitsubishi Chemical Holdings Corp., and former Shiseido Co. Chief Executive Officer Shinzo Maeda, Toshiba said.

The number board members will be reduced to around 11. Toshiba had 16 before the latest accounting problems surfaced.

The company has been reviewing its past earnings data after it said in April it had found accounting irregularities.

A third-party panel concluded in July that it systematically overstated profits for several years under pressure from top management.

Toshiba said the size of its expected net loss is not yet known, but it will book an asset devaluation loss of ¥127 billion and ¥48 billion in costs related to litigation and withdrawal from some of its operations.

The company currently expects ¥170 billion in consolidated operating profit and ¥6.66 trillion in sales.

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