During a week that all eyes are on Macy’s the iconic department store chain is making headlines for a reason outside of its annual Thanksgiving Day parade.
Company officials said its quarterly report for the third part of the year was delayed after it was discovered a single employee hid up to $154 million in expenses over several years, The Associated Press reported.
The company did not say why the employee allegedly hid the expenses, CNN reported.
Macy’s, which also owns Bloomingdale’s and Bluemercury, said they found an issue with its accrual accounts this month and conducted an independent investigation.
A forensic analysis found an employee, who doesn’t appear to be with the company anymore and who dealt with small package delivery expense accounting made fake entries to hide expenses of between $132 million and $154 million of expenses. The company said fraudulent accounting started in 2021′s fourth quarter through the quarter which ended Nov. 2.
Macy’s had about $4.36 billion in delivery expenses during that time period.
The company said it doesn’t appear that the issue had any impact on cash management or vendor payments. No other employees were implicated either.
But the problem will cast a shadow on the company’s financial operations, retail analyst Neil Saunders told CNN.
It “raises the question as to the competence of the company’s auditors,” Saunders said. “Such things create more nervousness for investors who are already concerned about the company’s performance.”
Macy’s already announced plans earlier this year to shut more than 100 stores as it tries to course correct.
The company will release its full quarterly report on Dec. 11, CNN reported. But The New York Times reported sales fell in the third quarter 2.4% to $4.74 billion.
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