Multinational retail giant Walmart has said that the company is expected to incur financial losses in view of ongoing investigation into alleged corruption cases pertaining to its foreign subsidiaries.
New Delhi: Multinational retail giant Walmart has said that the company is expected to incur financial losses in view of ongoing investigation into alleged corruption cases pertaining to its foreign subsidiaries.
"...We expect to continue to incur costs (in addition to the USD 157 million of costs incurred in fiscal 2013) in conducting our on-going review and investigations", the company said in a filing to US Securities and Exchange Commission.
The company claimed that Audit Committee comprising its independent directors (on board) is conducting an internal investigation into, among other things, alleged violations of the Foreign Corrupt Practises Act ("FCPA") and other alleged crimes or misconduct in connection with certain of our foreign subsidiaries, including Wal-Mart de Mexico, S.A.B. De C.V., or Walmex.
On the scale of loss the company said, "We believe that it is probable that we will incur a loss from these matters...We cannot reasonably estimate any loss or range of loss that may arise from these matters."
"Although we do not presently believe that these matters will have a material adverse effect on our business, given the inherent uncertainties in such situations, we can provide no assurance that these matters will not be material to our business in the future", it stated.
It also mentioned that investigations regarding allegations of potential FCPA violations have been commenced in a number of foreign markets where the Company operates, including, but not limited to, Brazil, China and India.
In India, a government-appointed inquiry committee, looking into the US lobbying activities of Wal-Mart Stores for Indian market foray, has recently met senior executives of the global retail giant and sought details on the issue.
The committee met the representatives of Walmart Asia as well as those of Bharti Walmart Private Ltd, the company's Indian joint venture with Bharti group, along with their counsel here.
The companies were asked to provide details on queries raised by the committee, which was set up earlier this year to inquire into reports of the US-based firm's lobbying among the American lawmakers for entering the high-growth Indian market.
The committee is also looking into "whether Wal-Mart undertook any activities in India in contravention of any Indian law" and any other matter relevant to this issue.