Spar CEO to step down after auditors flag ‘fraudulent loans’
Spar CEO Brett Botten will be retiring from his role at the end of January, the company has confirmed.
The announcement, which was issued to the company shareholders on Thursday, comes amid allegations of financial impropriety, racism against black franchisors and allegations of dodgy accounting.
In response to the allegations last year, the company said it was seeking legal guidance on what it called an isolated incident, while denying allegations of dodgy accounting.
The retailer said its auditors have reported the fictitious and fraudulent loan to the Independent Regulatory Board of Auditors.
"Over the past month, Spar and the external auditors have conducted investigations into the matter. At the end of the process, the board agreed with Spar’s auditors that a reportable irregularity had occurred. Spar’s auditors are satisfied that this was an isolated matter and is no longer taking place, and adequate steps have been taken for the prevention of any loss as a result thereof.
“However, the board concluded that the loan did not seem to have served any real commercial or economic purpose and should not have taken place. The board confirms that the extensive review of all loans arranged by SPAR for retailers identified two other transactions of a similar nature," the statement said.
The company said the combined value of the three loans totalled R11 million and was made some five years ago.
"This arrangement is not Spar practice and there is no evidence to support any allegations of accounting irregularities with any other loan transactions.”
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