Don’t believe the headlines: Harveys has not lost $40 million

Exclusive by Patrick Avenell

SYDNEY, NSW: Harvey Norman has not lost over $41 million in cash, and its profit for FY2009 has not been affected, according to CFO Chris Mentis. News of missing millions is specious, and is an incorrect interpretation of the amendment the listed retail group made to its financial report on Wednesday.

Two weeks after delivering its annual report to shareholders, Harvey Norman Limited posted an amendment to the Australian Securities Exchange (ASX), outlining a calculation error. According to the report, this error “reduced the parent entity’s profit from continuing operations after tax by $41.74 million”.

Chris Mentis told Current.com.au that this error has in no way affected the company’s bottom line.

“If we had lost $41 million hard cash, I wouldn’t be here, because I’m the finance director and all that comes under my control,” said Mentis.

“As the note clearly sets out, on page 61 of the annual report, Roman numeral XXX (30), you’ll see exactly what happened. It affected the parent entity accounts, not the consolidated accounts. Because on consolidation, those transactions get eliminated, and as a result, the consolidated balance sheet, profit and loss, and cashflow [are] not affected one cent.

“There’s no effect on the profit one cent.”

When asked about newspaper headlines claiming Harvey Norman has lost money, or that there are missing millions, Mentis was absolute in his response.

“There is no missing money, there is no lost money. The ASX understands this; there’s no issue with the ASX, there was no problem with the shareprice, as we saw over the last couple of days as a result of this disclosure…there is no effect on consolidated profit as reported to the stock exchange.”

Due to the remarkable news surrounding rival Clive Peeters’ recent tribulations with missing millions, Mentis was asked if the market could expect any extraordinary announcements from Harvey Norman. He said this was a, “Completely different thing – chalk and cheese.”

Leave a Reply

Your email address will not be published. Required fields are marked *

*