ID NEWS: USF bonuses frozen until audit is completed

Annual bonuses won't be paid to executives or sales personnel at U.S. Foodservice (USF), Columbia, MD, until the company's 2002 books are audited as part of an ongoing investigation of accounting irregularities, Dow Jones has reported.

That process could take weeks or months, and there is a possibility that if the audit finds the bonuses reflect false transactions, they may not be paid in full --or at all-says this news organization.

"Don't count on anything," a divisional vice president is said to have been told during a recent conference call.

A subsidiary of Royal Ahold, Zaandam, The Netherlands, USF is thought to have overstated more than $500 million in income from promotional monies over a period of two or more years. Auditors have suspended work on Ahold's fiscal 2002 audit, pending completion of investigations by the U.S. Department of Justice and the Securities and Exchange Commission.

Dow Jones says that bonuses have become an "important reward" for many USF top employees. For some executives, they reportedly comprise at least 25 percent of annual income, and, for senior officers, the percentage could be "much larger."


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