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ZAANDAM, Netherlands -- Global food retailer Ahold said yesterday its U.S. retail arm has stopped the practice of delaying payments to creditors, a method that it said boosted its cash position, but never led to fraud.
Spokesman Walter Samuels told the Reuters news service the practice by the U.S. operations boosted its cash position just before it drew up its quarterly accounts, but didn't impact the bottom line. He also said it was not illegal.
Ahold also said its accountants, PriceWaterhouseCoopers, had routinely informed the Securities and Exchange Commission of the delayed payments.
The delays boosted Ahold's cash position by $200 million on average each quarter, according to Reuters.
Ahold started delaying payments in 2001 and continued the practice for 13 quarters, according to other international press reports.
Ahold admitted in 2003 to accounting irregularities at its U.S. Foodservice unit that inflated its earnings by 1 billion over three years. Its top management resigned and the company was investigated. Last October, Ahold reached a settlement with the SEC over fraud charges.