Financial Accounting Blog

Tuesday, October 14, 2003

New Balance Sheet Accounting Rule Pushed Back

"The Financial Accounting Standards Board is giving corporations until the end of the year to bring their balance sheets into compliance with the Enron-inspired accounting rule called Fin 46. The nation's top bean counters granted the delay because of confusion about the rule, which is meant to deter the illegitimate use of off-balance-sheet accounting strategies."

Note that GE has already implemented Fin 46 and see its impact:

General Electric (GE:NYSE - commentary - research), which reported third-quarter earnings on Oct. 10, already is following the mandates of Fin 46. In its quarterly earnings, GE said it had consolidated $51 billion in assets onto its balance sheet and took a noncash charge of $372 million. The Fin 46-related charge reduced GE's net earnings by 4 cents a share to $3.64 billion, or 36 cents a share.