Kohl’s, Gymboree to Restate Results
San Francisco, Kohl’s Corp. and The Gymboree Corp. are the latest retailers to announce they would need to restate their earnings due to an accounting change. The accounting change relates to the way the retailers account for their leases, and a recent clarification of those accounting principles by the Securities & Exchange Commission (SEC). Gymboree noted that the SEC’s interpretation prompted many retailers to announce adjustments and restatements related to lease accounting.
Kohl’s will restate some information stretching from 1998 to the first three quarters of 2004. The retailer said that the accounting changes would negatively impact net income by $2 million in the fourth quarter of 2004. Among the extra expenses being added to Kohl’s accounting for the first three quarters of 2004 is $3 million in SG&A expenses per quarter and depreciation expenses of $1 million per quarter.
Gymboree will restate quarterly information filed in its 2004 fiscal year, and probably in prior periods, too, the retailer said.
Other retailers have had to restate earnings because of the SEC’s clarification. One of them is Toys “R” Us, which recently said it would restate some information going back to 2003 because of its lease accounting.
Read All About It: Workforce Management
New York City, Costs are rising and competitive pressure is increasing. Workforce deployment is becoming riskier and more expensive, and store operations are being complicated by increased labor-law compliance. To succeed in this challenging new environment, retailers need to implement initiatives to cut costs and increase sales, enhance the customer experience, and align store operations with equipment and technology, and the workforce with the work.
John T. Anderson, Retail Industry Manager of Kronos Inc., writes about workforce management in an article called “Driving Retail Business Performance Through Workforce Management.” To read the article in its entirety, click on the Guest Commentaries tab to the left.
Spiegel Plan: Focus on Eddie Bauer
Downers Grove, Ill., Spiegel filed its reorganization plan with the U.S. Bankruptcy Court for the Southern District of New York. The plan contemplates that the business will be reorganized around the Eddie Bauer division of Spiegel, Inc., establishing a new parent company, Eddie Bauer Holdings, Inc. Eddie Bauer will continue to operate through its stores, catalogs and Internet site, and will be headquartered in Redmond, Wash.
Spiegel filed for bankruptcy protection in March 2003.