Sara Lee Execs Implicated in Ahold Investigation

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The accounting scandals of Dutch food giant Ahold have touched the shores of the United States as three sales executives of US-based Sara Lee have been implicated in their dealings with the company.

Spokespeople for Sara Lee indicated that three sales executives have been relieved of their duties after improperly confirming to Deloitte & Touche incorrect details of rebate balances owed to Ahold subsidiary US Foodservice.

Sara Lee is not the focus of the SEC investigation, and company financial results will not be affected in any way by the Ahold inquiry. The SEC investigation is focused on how US Foodservice accounted for vendor allowances - the volume-related rebates received from suppliers.

It is unclear at this point whether the Sara Lee sales executives knew that the rebate figures they were being asked to confirm were greater than the "official" figure that the company was to report. Those sales executives, however, did not have the authority to confirm the rebate amounts, and that is the reason for them being "relieved of their sales responsibilities."

"While this is a serious matter, we want to emphasize that Sara Lee is not the focus of this investigation [by the Securities and Exchange Commission], and this discovery in no way affects our financial results. Sara Lee's accounting for our business with US Foodservice is both accurate and appropriate," said C. Steven McMillan, chairman, president and chief executive officer of Sara Lee Corporation.

"We will continue to co-operate fully with the SEC's investigation into accounting practices at the US Foodservice unit of Royal Ahold."


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