Good morning. Macy’s is in crisis mode after disclosing that an employee cooked the books for years, using unethical accounting practices to hide well over $100 million in expenses. On Monday, the retailer announced it would delay the full release of its third-quarter earnings, scheduled for Nov. 26, until Dec. 11 to complete an investigation into the employee's activities.
The person indicated, who was responsible for small package delivery expenses, is no longer an employee. According to Macy's, the worker “intentionally made erroneous accounting accrual entries," which served to hide between $132 to $154 million in delivery expenses from Q4 2021 through the fiscal quarter that ended Nov. 2. During this same time period, Macy’s accounting statements recognized around $4.36 billion in delivery expenses—suggesting that somewhere between 3% and 3.5% of those expenses were fictitious.
