Darker blue is operational profit and lighter blue is sales total in ¥100mil.(~$mil.)
Just like an oscillating power circuitry! Can’t make this up and they couldn’t have been more engineering oriented than this.
Edit: I believe the tweet is referring to the 2015 accounting scandal (listed on wikipedia here[0]), more information on how it happened here[1].
From what I understand, the oscillations come from the fact that corporate leadership handed down profit targets for business unit presidents to meet, with the expectation that failure to meet them = you're fired. So the business unit presidents worked with accountants to fudge the numbers at the end of every quarter to meet the unrealistic targets. Then the numbers would revert back to reality at the start of the next quarter. Corporate leadership was only looking at end-of-quarter numbers so they just kept increasing the (already unrealistic) profit targets year after year? Or maybe they understood what was going on but liked the effect it was having on their stock options/bonuses/whatever, so they kept perpetuating the fraud? But then again, why allow profits to revert back to reality, why not fudge profits all the way to hide the oscillations?
My vote is on corporate leadership incompetence. When you have a dictatorship-like culture of strict obedience, you start having an information propagation problem. Your underlings will suppress information they know you won't like (because you'll punish them) and will only feed you the truth when convenient. They will also outright lie if they have to, to save themselves from your wrath.
[0] https://en.wikipedia.org/wiki/Toshiba#2015_accounting_scanda...
[1] https://www.investopedia.com/articles/investing/081315/toshi...
Obviously Profit can't exceed Revenue, but how did they do this?
The tweet I quoted was about a newly discovered incident but the chart is from 2015. Sorry but that was the best link I could find at that time.
In that instance at P.C. sales in 2008-2015, IIRC, the employees were forced to “do challenges” to meet the predetermined goals by the end of fiscal year(31st March in Japan). But the target wasn’t realistic and “challenges” became a synonym for various manipulation inside the corporate, from relabeling future sales to forging documents. That led to yearly pulse right at the end of FY and scheduled YoY growth on paper.
The profit only exceeded the monthly revenue, not the quarter average.
So future contracts projected into the figures at present had to stay at that point in time in case they materialize later. That led to sharp decline after the numbers for one term was finalized.
It's a pity that Wells Fargo has not yet exited the banking business :)
[0] https://en.wikipedia.org/wiki/Wells_Fargo_account_fraud_scan...
So impossible targets set late. You basically tell them "be fired or cheat". Then the corporate culture, or maybe Japanese work culture, means no communication that the impossible is being asked. So, save your skin.
Stupid maneuvers all around.
The books were cooked. The profits oscillations in the tweet graph aren't natural, and the peaks were inncreasing.
At one point the profits were even greater that revenues.