Ahold finds $880m overstated in US Foodservice accounts
Results of accounting investigation announced
May 8 2003
Ahold’s US Foodservice division overstated its accounts by $880m over three years, the Dutch supermarket operator has announced.
In addition, the forensic accounting investigation carried out by PricewaterhouseCoopers found another $90m of adjustments needed to the accounts of the US business.
The revelation of accounting irregularities related to supplier payments at US Foodservice, discovered earlier this year, has left Ahold reeling and under investigation by the authorities in both the USA and the Netherlands.
Ahold said the work being performed by PwC as part of Ahold’s internal investigation is now substantially complete. Around $110m in overstatements relates to the 2000 financial year, $260m to 2001 and $510m to year 2002.
Adjustments to be made include $700m of write-offs of supplier payments, a $210m increase in contract revenue liabilities, an $80m increase in trade payables, and a $25m increase in inventory.
Ahold said an internal legal investigation at US Foodservice is ongoing, and its board of hold will meet shortly to determine what action should be taken.
The supermarket giant also said that internal investigations at various Ahold operating companies including Albert Heijn, Stop & Shop, Santa Isabel in Chile, Ahold’s operations in Poland and the Czech Republic, and is Scandinavian joint venture, are “substantially complete and no evidence of financial fraud has been found at any of those operations.”
