Macy’s reported weaker-than-expected preliminary sales for the fiscal third quarter and delayed the release of its quarterly earnings results after discovering an accounting-related issue.
The big picture: The department store chain identified an issue related to delivery expenses, and an independent investigation found that a single employee intentionally made erroneous accounting accrual entries to hide approximately $132 million to $154 million in expenses from the fourth quarter of 2021 through the fiscal quarter ended Nov. 2.
- The company recognized about $4.36 billion of delivery expenses during the same time period.
- Macy’s asserts that the conduct did not impact its cash management activities or vendor payments, and the responsible employee is no longer with the company.
Go deeper: The delay in reporting its third-quarter earnings results is to complete an independent investigation and Macy’s anticipates reporting its full third-quarter financial results by December 11.
- Preliminary results for its third quarter show a 2.4% decrease in net sales, with comparable sales down 2.4% excluding licensed businesses like cosmetics.
