By George Anderson
Six Krispy Kreme executives have lost their jobs in connection with the government's investigation into accounting fraud at the company.
Last week, a special committee of independent directors for the company recommended that the six, including four senior vice presidents working in operations, finance, business development, and manufacturing and distribution, be dismissed.
Five of the six resigned while the last retired from Krispy Kreme.
Krispy Kreme's announcement of the executives' departures follows former CEO Scott Livengood's ouster in January.
Peter James Hall, who oversees $1 billion for Hunter Hall Investment Management in Australia (the company holds 4 million shares of Krispy Kreme stock), told Bloomberg News he was encouraged by the latest news. "I'm very pleased they're taking such serious action. The most important thing is that the special committee reports and the company reports its financial statements, and then we move on to the next phase of the evolution of the company."
On Mr. Hall's last point, a column by Herb Greenberg on the MarketWatch Web site questions what is really going on at Krispy Kreme.
Mr. Greenberg writes that the company "hasn't filed its financial statements with the SEC since last September. It recently warned the delays will continue in the fiscal first quarter, which (surprise, surprise) will show a loss."
He further questions why Krispy Kreme has yet to hire a permanent CEO to lead the company and why it hasn't rolled out any new products, implemented an ad campaign or appears "to have done much of anything to help its franchisees."
At the rate it is progressing, suggests Mr. Greenberg, Krispy Kreme "might as well bring back Scott Livengood."
Moderator's Comment: Are the corporate scandals that have come to light in recent years, including that at Krispy Kreme, indicative of a lack of moral values in America's corporate suites? - George Anderson - Moderator