ASB to consider grocery store standard
The Accounting Standards Board may consider setting a standard for like-for-like sales after concerns about the lack of regulation were raised by the chief executive of Safeway.
Link: Supermarkets block publication of detailed figures
The lack of transparency in the reporting of these sales was revealed when the Institute of Grocery Distribution admitted supermarkets supplied it with detailed sales figures, but used different numbers in reports to investors. Earlier, Safeway chief executive Carlos Criado-Perez had raised the issue, saying like-for-likes, often used by analysts to evaluate the position of a retailer, are not an accurate assessment of performance.
City analysts are concerned about the shortcomings of the current system.
They say publications of more detailed figures would enable shareholders to make accurate comparisons between retailers using like-for-likes. One analyst said: ‘The figures given to the IGD are their true sales. The figures they adjust are the ones given to the market.’
The ASB confirmed there is no specific standard for reporting like-for-like sales. Allan Cook, ASB technical director, said: ‘Like-for-likes are considered straightforward.’
But he added: ‘If there is sufficient concern about the lack of such a standard, we may consider it.’
A Safeway spokesman said regulating like-for-like sales would be difficult because there is no single way of measuring sales. He added the company is not specifically calling for a new standard.
Those opposing the like-for-like calculations say that the questions raised would result in a ‘troublesome’ standard.