Oh, what a tangled web we weave.
Remember last December when news broke that a Macy’s employee hid $151 million in delivery expenses over the span of three years? The employee, who (duh) is no longer with the company, wasn’t pursuing personal gain, though. It actually started as a mistake, and then became a maaaaaassive cover-up in which an accounting error for small parcel delivery fees turned into a $151 million problem after the employee continued making (intentional) errors to hide the issue.
Like we said: Oh, what a tangled web…
Now, that web is getting even knottier. The company is recouping over $600,000 in executive bonuses because that the $151 million mistake also led to $609,613 of “erroneously awarded compensation,” according to a company SEC filing. Whoops!
Basically: Macy’s cash bonuses for executives were tied to adjusted 2023 EBITDA, but because of the whole massive accounting scandal scenario, EBITDA was exaggerated by just above $81 million, thus “changing the overall payout” under Macy’s annual incentive plan “from 60.47% to 51.59% of target.”
As a result, payouts in the aggregate came out to around $3.5 million instead of $4.15 million. Bummer. Macy’s giveth, Macy’s taketh away.
The correction comes as Macy’s debuts a leadership shakeup, announcing last week that its current COO and CFO, Adrian Mitchell, will leave the company near the end of June. He’ll be replaced by Thomas Edwards the next day. Hey, sometimes they’re prompt.
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