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This year, the Macy’s Inc. finance team will have a parade march of its own: a yearslong paper trail of up to $154 million in hidden delivery expenses.
The retailer, whose store brands include Macy’s, Bloomingdale’s, and Bluemercury, announced it had to delay its Q3 earnings after it found a rather large accounting discrepancy. It turns out, an employee who handled small-package delivery expenses “intentionally made erroneous accounting accrual entries” and hid between $132 million and $154 million in delivery expenses reaching back to Q4 2021. Macy’s reported about $4.4 billion of delivery expenses over that period.
According to Macy’s, “there is no indication that the erroneous accounting accrual entries had any impact on the company’s cash management activities or vendor payments,” nor has the company found anyone else involved. Needless to say, the employee responsible is no longer with the company.
“At Macy’s, Inc., we promote a culture of ethical conduct,” CEO Tony Spring said in a news release. “While we work diligently to complete the investigation as soon as practicable and ensure this matter is handled appropriately, our colleagues across the company are focused on serving our customers and executing our strategy for a successful holiday season.”
Macy’s did release preliminary quarterly results, which showed net sales dropped 2.4% to approximately $4.7 billion compared to Q3 2023. The retailer said it expects to release its full Q3 results and hold its earnings call by Dec. 11.