Accounts & Bookkeeping

An implicit warning for online accountants as camera maker Olympus is ordered to pay back £40m in taxes

Japan-based consumer electronics firm Olympus has been ordered by Tokyo’s regional taxation bureau to pay back approximately ¥5bn (£40m) that it owes in back taxes and penalties due to its purchase of British medical equipment purveyor Gyrus Group in 2008. The whole episode provides an implicit warning to online accountants all over the world to endeavour to ensure that their operations always adhere to the law of the relevant country.
Indeed, the liability which the bureau have ordered Olympus is pay is linked to a ¥15bn advisory fee which the company originally claimed to have received due to their purchase of Gyrus Group. However, it was later revealed – and reported by Japanese newspaper Nikkei – that the fee was in fact used to conceal losses at Olympus.
It was only last year that the former chief executive of Olympus, Britain-born Michael Woodford, was ousted from the company following his public questioning of suspicious merger and acquisition payments. However, it was in June that, for £10m, he settled an unfair dismissal and discrimination claim against the company. Meanwhile, it was in January that auditors KPMG and Ernst & Young were cleared of any responsibility for the accounting black hole uncovered at Olympus.
The whole episode concerning the recent accounting scandal at Olympus demonstrates to online accountants all over the world the importance of always paying close attention to the nature of the relevant law in the relevant country.

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