• Jean Paul Gaultier for Target Australia.
    Jean Paul Gaultier for Target Australia.
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As Target fields allegations it artificially inflated its earnings, the timing has added extra sting.

Parent company Wesfarmers is investigating claims Target used supplier rebates to prop up earnings for the first half of fiscal 2016.

Target allegedly brokered deals with overseas suppliers to receive rebates on stock for the six month period.

The arrangement would see it pay more for stock in the second half, where it would take a hit due to higher inventory costs.

Target's earnings before interest and tax were up 5.7% to $74 million for the first half of fiscal 2016.

The move comes at a critical time in Target's bid to create an ethical and transparent supply chain.

Last year, it started publishing details of supplier factories in Bangladesh, Vietnam, Cambodia, India and Sri Lanka.

This month, it had intended to publish details of remaining factories including those located in OECD countries.

While no details are available on Target's ethical footprint specifically, there were 2,139 approved factories in Wesfarmers' broader audit program in 2015.

During the year, it identified 39 critical breaches across the factories in its audit program.

These mainly concerned issues (or allegations) of bribery, unauthorised subcontracting and forced labour.

Twenty-one of these issues were immediately resolved and no further orders were placed at the factories where the remaining 18 breaches occurred.

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