INDEPENDENT AUDITORS' REPORT
The Board of Directors
LADD Furniture, Inc.:
Under date of February 7, 1997, we reported on the consolidated balance sheets
of LADD Furniture, Inc. and subsidiaries as of December 30, 1995 and December
28, 1996, and the related consolidated statements of operations, shareholders'
equity and cash flows for each of the years in the three-year period ended
December 28, 1996, as contained in the Appendix to the Proxy Statement for the
1997 Annual Shareholders Meeting. These consolidated financial statements and
our report thereon are included in the annual report on Form 10-K for the year
ended December 28, 1996, also contained in the Appendix to the Proxy Statement
for the 1997 Annual Shareholders Meeting. In connection with our audits of the
aforementioned consolidated financial statements, we also have audited the
related financial statement schedule as listed in the accompanying index. This
financial statement schedule is the responsibility of the company's management.
Our responsibility is to express an opinion on this financial statement schedule
based on our audits.
In our opinion, such financial statement schedule, when considered in relation
to the basic consolidated financial statements taken as a whole, presents
fairly, in all material respects, the information set forth therein.
KPMG Peat Marwick LLP
Greensboro, North Carolina
February 7, 1997
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LADD FURNITURE, INC. AND SUBSIDIARIES Schedule II
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Valuation and Qualifying Accounts and Reserves
(dollar amounts in thousands)
Charged
Balance at (credited) Balance at
beginning of to costs and Charged to Deductions end of
Description year expenses other accounts (c) year
- ------------------------------ --------- ---------- ------------ ------------- ------------
Year ended December 28, 1996
Doubtful receivables $2,553 3,308 (540)(a) (3,696) 1,625
Discounts 123 (40)(d) - - 83
Returns and allowances 1,381 (84)(d) - - 1,297
--------- ---------- ------------ ------------- ------------
$4,057 3,184 (540) (3,696) 3,005
========= ========== ============ ============= ============
Year ended December 30, 1995
Doubtful receivables $2,832 2,898 (1,085)(a) (2,091) 2,553
Discounts 0 123 (d) - - 123
Returns and allowances 1,462 (36)(d) (45)(a) - 1,381
--------- ---------- ------------ ------------- ------------
$4,294 2,985 (1,130) (2,091) 4,057
========= ========== ============ ============= ============
Year ended December 31, 1994
Doubtful receivables $3,316 1,521 338 (b) (2,343) 2,832
Returns and Allowances 862 294 (d) 306 (b) - 1,462
--------- ---------- ------------ ------------- ------------
$4,178 1,815 644 (2,343) 4,294
========= ========== ============ ============= ============
Notes
(a) Represents businesses divested or reclassified to businesses held for
sale.
(b) Represents initial reserves of acquired business.
(c) Represents uncollectible receivables written-off, net of recoveries.
(d) Represents net increase (decrease) in required reserve.
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