Saks ups total of improper markdowns
David Perry -- Furniture Today, August 25, 2005
BIRMINGHAM, Ala. – Saks Incorporated has finished its internal investigation of improper vendor markdown allowances first discovered by independent auditors and found that the amounts collected were larger and spanned a longer period of time than first thought.
Saks stated it had confirmed that during the company’s 1999-2003 fiscal years, one of six Saks Fifth Avenue (SFAE) merchandising divisions improperly collected markdown allowances from vendors. However, while the independent investigators found improper markdowns totaling $20 million, the recently released internal investigation has upped that number to $26 million during the same period. Additionally, the investigation found that $8.2 million in improper markdowns was collected from 1996-1998.
“These amounts are attributable to over-collections that resulted from falsification, by merchants in the one SFAE division, of information delivered to vendors,” the company stated.
The company is advising the affected vendors that it intends to reimburse them for the charges, with interest of 7.25 percent per year totaling approximately $14 million.
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