Harvey Norman Shares Slump, Call For ASIC Investigation Of Questionable Accounts
Harvey Norman shares slumped 3.5% in late afternoon trading, following an Annual General Meeting that has been described as one of the “Worst meetings” by the head of the Australian Shareholders Association.
Chairman Gerry Harvey who at one stage told attendees to “piss off” is upset that the Association along with the media are questioning his accounts and the way that the business is run.
Australian Shareholders Association representatives David Jackson and Allan Goldin are not only less than satisfied they have urged the Australian Securities and Investments Commission to investigate whether franchisees should be consolidated.
“It was one of the worst meetings I’ve attended,” said Mr Jackson. “He doesn’t encourage conversation or discussion and runs the business as if it’s his own private fiefdom.
“Because [the accounts] are so confusing we think it’s something ASIC should be looking at,” said Mr Goldin.
“God you’re a pain in the arse,” Mr Harvey told Goldin.
“Why don’t you shut up and get out of here,” he told David Jackson, another ASA executive at the meeting.
The call for an investigation into Harvey Norman accounts were triggered by the retailer’s latest annual report, which contained information that the Company was warehousing loans totalling $943 million to its franchisees and had written off $566 million of those loans in what Harvey Norman management refer to as “tactical support”.
The big retailer it appears has been doing this for several years as franchisee after franchisee falls over resulting in Harvey Norman management calling in a fixer to clean up the financial mess with the franchisee walking away free of any liability.
Proxy advisor, Ownership Matters, recommended a vote against Harvey Norman’s accounts. It also said the retailer should consolidate its franchisee accounts with its group accounts, and provide greater clarity regarding this $943 million it “advanced” to franchisees in recent years.