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Nope, because shrinkage is an expense against inventory in the accounting books; fundamentally, it's a "tax" on your COGS to get to your revenue. Overreporting
by HillRat 3y ago
Nope, because shrinkage is an expense against inventory in the accounting books; fundamentally, it's a "tax" on your COGS to get to your revenue. Overreporting losses is just a bit of financial kabuki to shift underperformance over to something other than executive leadership.
- yardstick 3y agoI wouldn’t consider how the accounting system treats this as relevant to what the real opportunity cost is. The accounting approach is driven by taxation, and governments strong preference for maximising their tax take.