Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

SEC Seeks Accounting Information from GM and Ford
rEUters ^ | 10/19/2004 | Michael Ellis

Posted on 10/19/2004 10:53:02 AM PDT by BurbankKarl

DETROIT (Reuters) - U.S. regulators asked automotive giants General Motors Corp. and Ford Motor Co. for information on how they account for pension and health care plans, the companies said on Tuesday.

Last week, the Securities and Exchange Commission said it was looking into possible accounting abuses involving employee pension funds. The automotive industry has been particularly hard hit by rising health care costs and underfunded pension plans.

"It's obviously not a positive," Carl de Jounge, auto credit analyst at Deutsche Bank in New York, said when asked about the request to Ford.

"Investors have been concerned about pension and health care costs," he said. "If we have a regulatory push for more conservative assumptions, that could put more pressure on future earnings."

GM and Ford stock prices slipped slightly in early trade on the New York Stock Exchange. GM shares fell 60 cents, or 1.5 percent, to $38.30, while Ford fell 27 cents, or 2 percent, to $13.12

GM and Ford bonds fell relative to U.S. Treasuries on the news.

In a conference call to analysts and reporters about Ford's earnings, Ford Chief Financial Officer Don LeClair said, "We adhere to the highest accounting standards and we will cooperate with the agency on this review."

He added that given the size of the company's pension and retiree health care obligations, it was not surprising that a general SEC inquiry would include Ford.

Earlier on Tuesday, Ford posted a stronger-than-expected quarterly profit, but only because its finance arm offset losses from its automotive business. Last week, GM also posted a loss from its automotive arm, the first since strikes nearly shut North American operations in the third quarter of 1998.

Delphi Corp., the largest U.S. automotive supplier, said on Monday in a securities filing that the SEC also requested the information.

GM spokeswoman Toni Simonetti said the automaker would comply with the request.

"We are confident that GM's financial reporting in this complex area has been accurate and complete," she said.


TOPICS: Business/Economy; News/Current Events; US: Michigan
KEYWORDS: gmf; napalminthemorning

1 posted on 10/19/2004 10:53:03 AM PDT by BurbankKarl
[ Post Reply | Private Reply | View Replies]

To: wmichgrad

ping


2 posted on 10/19/2004 11:26:27 AM PDT by CSM
[ Post Reply | Private Reply | To 1 | View Replies]

To: VoiceOfBruck

Blue Oval Ping!


3 posted on 10/20/2004 4:21:34 AM PDT by CSM
[ Post Reply | Private Reply | To 1 | View Replies]

To: CSM

Don't worry, Kerry has a plan.


4 posted on 10/20/2004 4:45:49 AM PDT by VoiceOfBruck (I was cupbearer to the king.)
[ Post Reply | Private Reply | To 3 | View Replies]

To: VoiceOfBruck

I better go check out his web site!


5 posted on 10/20/2004 5:26:29 AM PDT by CSM
[ Post Reply | Private Reply | To 4 | View Replies]

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson