Online retailer Saks Incorporated announced completion of management's confirmatory and supplementary work arising from the findings of the internal investigation conducted by the Audit Committee of the Company's Board of Directors, which was initially disclosed by the Company on March 3, 2005. The Company also announced the completion of the Audit Committee's supplemental inquiry that was disclosed on June 3, 2005.
The Audit Committee's initial investigation disclosed on March 3, 2005 was commenced at management's request. On May 9, 2005, the Company disclosed the independent investigators' conclusion that, during the Company's 1999-2003 fiscal years, one of six Saks Fifth Avenue ("SFAE") merchandising divisions improperly collected markdown allowances from vendors totaling approximately $20 million. The Company also disclosed on May 9, 2005 that Company management was undertaking its own work to confirm this amount and to supplementally determine whether that SFAE division improperly collected markdown allowances before fiscal 1999.
On June 3, 2005, the Company disclosed that the Audit Committee had begun a supplemental inquiry into (1) timing of recording of inventory markdowns and vendor markdown allowances at SFAE, (2) whether there had been any overcollections of vendor markdown allowances in any of the merchandising divisions of SFAE that had not been the subject of the Audit Committee's initial investigation, and (3) whether there had been any inappropriate billing/logistics/transportation compliance chargebacks by the Company to any of its merchandise vendors.