In an update to shareholders on Thursday, Spar said its auditors, PricewaterhouseCoopers, found the loan to be a reportable irregularity, meaning IRBA needed to be notified immediately.
This is the first time that Spar has acknowledged wrongdoing related to loans it arranged for retailers. The grocer previously said it was waiting for a legal opinion before commenting. The HMN report, leaked to News24 last year, found that two loans the grocer had entered into"lacked substance". But HMN was unable to say at the time where the loans constituted accounting irregularities. Spar's board had now decided that they did.
The combined value of all three loans is R11 million. It was not immediately clear whether these two loans had also been reported to IRBA.