Today’s column offers a review of a clawback fraud; CFO.com explains that Kraft-Heinz (KHC) reported supplier contracts that made it appear as if expense savings were provided in exchange for past or same-year events performed by the company when, in reality, they were upfront payments in exchange for a future benefit from KHC. This was done in order to improperly recognize costs savings prematurely.
- When did the U.S. Securities and Exchange Commission allege that the accounting fraud began at Kraft Heinz?
- Approximately how many misleading accounting transactions were recorded during the fraud?
- Which division of Kraft Heinz had improperly managed expenses resulting in unrealistic cost savings and inflated profits?
Heller, M. (2021). Kraft Heinz Fined $62M for Accounting Fraud. CFO.com, Sep. 3 (Retrievable online at https://www.cfo.com/accounting-2/2021/09/kraft-heinz-fined-62m-for-accounting-fraud/)