Toshiba’s chief executive and president Hisao Tanaka is resigning from his post, following the news the company overstated its profits.
An independent panel that was appointed by Toshiba revealed the firm had overstated its operating profit by 151.8 billion yen (£784.1 million).
The investigation found that Tanaka was aware that the company had exaggerated the profits.
Massashi Muromachi, Toshiba’s current chairman, will replace Tanaka, while vice chairman Norio Sasaki is also leaving the company.
The financial scandal first begun after the company looked into the method of accounting used within its PC, semi-conductor and TV businesses.
Toshiba also reviewed its past financial reports, to see whether they were accurate or not.
According to Reuters, Tanaka said in a news conference: “I see this as the most damaging event for our brand in the company’s 140-year history. I don’t think these problems can be overcome overnight.
"It’s not my understanding that I gave orders for improper accounting, but the reality is that such an observation has been made.
"The new executives and management must take preventative measures accordingly."
Japanese finance minister Taro Aso said that the accounting scandal was ‘very regrettable’.