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Arhaus Misstates Operating Cash Flows Two Consecutive Years

Retailer cumulatively overstated operating cash flows by nearly $8 million.

March 28, 2024

While preparing its 2023 financial statements Arhaus (ARHS), a premium home furnishings retailer, says it realized its balance sheet and cash flow statements were inaccurate the prior two years.

Arhaus says certain leasehold and landlord improvements prior to showroom completion were incorrectly included in prepaid and other current assets rather than property, furniture and equipment.

The error resulted in Aarhus overstating operating cash flows by:

—$1.2 million, or 1.7% in 2022
—$6.4 million, or 4.3% in 2021

Arhaus says the errors are immaterial and will not correct inaccurate prior filings.

Though it corrected three of the four inaccurate financial statements in its latest annual report, the company did not include a revised 2021 balance sheet.

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