Gareth Ackerman. Picture: FINANCIAL MAIL
Gareth Ackerman. Picture: FINANCIAL MAIL

Pick n Pay chair Gareth Ackerman says the constant changes to financial reporting standards and requirements are becoming counterproductive and a major burden on management teams.

Ackerman’s comments come as authorities investigate a handful of high-profile accounting scandals in SA, including at furniture retailer Steinhoff and sugar producer Tongaat Hulett.

“An increasing amount of management focus — which could be better deployed elsewhere — has now to be diverted to satisfying an excessively detailed approach by the regulators to the reporting of financial and performance metrics,” Ackerman said at Pick n Pay’s AGM.

Regulators prescribe “in artificial detail” how these metrics should be reported. “Constant changes in accounting standards add ever greater levels of complexity and actually detract from transparency because it becomes ever more difficult to analyse performance on a consistent basis over time,” Ackerman said. 

While reporting frameworks are necessary, “they should certainly not create an artificial level of assurance, obscured by complexity ... We believe that a more flexible, pragmatic and sensible approach would better achieve the valid aims of the regulators.”

Meanwhile, Ackerman said Pick n Pay was “concerned” about the outcome of a recent Competition Commission inquiry into the retail sector. Among other things, the commission found that Pick n Pay and its peers should stop enforcing exclusivity clauses in their lease agreements in malls, as these limit competition.

“We have engaged extensively and constructively with the inquiry team and will continue to do so. This includes areas where we believe their findings are based on errors of fact or interpretation, and where their draft recommendations would damage the interests of consumers,” Ackerman said.

He also said Pick n Pay will work closely with the industry and government as “SA has lost too many years and it’s now time to put our foot on the accelerator”.