What's up with GM's accounting?
Were the accounting errors at General Motors - publicly announced shortly after the Delphi unraveling - accidental in nature, or was something more evil behind the manufacturer's need to restate several years of financial results? The Detroit Free Press notes that in its investigation of filings and court records that the vast majority of the mistakes tended to go in a favorably direction for the company, which some might believe indicates something more insidious than random mistakes. The problems with GM's books mostly relate to supplier rebates and credits, which may have been improperly applied to GM's stated profit from 2000 through 2005. Some of the credits will be re-applied in upcoming years and GM officials explain the rest away as "mistakes", but others feel that the errors are the result of an overly aggressive campaign to improve the automaker's standing on Wall Street.
Most believe that the errors themselves aren't GM's biggest problem at this point, however, and that the company's survival plan for the next few years should be of much more concern to investors.
[Source: Detroit Free Press]
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