Theft is a huge problem for Wal-Mart. The world's largest retailer likely loses about 1% of its
Question:
Theft is a huge problem for Wal-Mart. The world's largest retailer likely loses about 1% of its US revenue — or roughly $3 billion dollars every year — to stealing by customers and employees, Reuters reports. “One percent of $300 billion is quite a lot of money. If you can save 10 basis points [or 0.1%] of it - boy I’ll take it every day of the week and put it into lower prices for customers,” Greg Foran [head of the company’s US operations) told Reuters. (Wal-Mart Loses an Insane Amount of Money to Theft Every Year by Hayley Petersen, Business Insider, June 5, 2015) Living only 20 miles south of Walmart headquarters in Bentonville, Arkansas, [Steve Clark, J.D., CFE, an ACFE faculty member and visiting professor of law at St. Thomas University School of Law in Miami] is well-versed in the retail giant’s business culture. “Purchasers for Walmart are like investigative journalists,” he said. “They won’t let you give them anything, not even a cup of coffee. So, when a vendor says, ‘Hey, I’ve done $3 million worth of business with you. Here’s an opportunity that could give us a little something on the side,’ they throw him out. Why is that outcome so certain? Because Walmart leadership has communicated it, reiterated it and enforced it. There’s no doubt in employees’ minds about what’s wrong, what the penalties are and whether management will back them up if they report a breach. It’s the right way the smart way to run a business.”?
Can the claims of these two articles be reconciled? If so, how? If not, why not?
Financial Reporting Financial Statement Analysis and Valuation a strategic perspective
ISBN: 978-1337614689
9th edition
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw