http://www.ernharth.com/vi/2006/03/31/accounting-standards-to-expose-pension-debt-more-thoroughly/ Don't Be a Fall Guy Wed, 19 Nov 2008 15:02:44 +0000 http://wordpress.org/?v=2.6.2 http://www.ernharth.com/vi/2006/03/31/accounting-standards-to-expose-pension-debt-more-thoroughly/#comment-2237 Vigilant Investor | Ernharth Perspective » Blog Archive » GM Jettisons GMAC for Much Needed Cash Mon, 03 Apr 2006 18:57:12 +0000 http://www.ernharth.com/2006/03/31/accounting-standards-to-expose-pension-debt-more-thoroughly/#comment-2237 [...] In a mad scramble to stem its $105 billion reported losses in 2005, GM announced today it will unload its profitable GMAC lending unit to Cerberus Capital Management LP for about $14 billion. That’s helpful to stem the bleeding, but far from the final answer on needed restructuring for GM. For example, as we reported last week, its pension obligations alone remain $35 billion under-funded, which takes their overall balance sheet from $14 billion in the black to $16 billion in the red should GAAP accounting be updated as proposed to require pensions to be fully held as the liabilities they are on the balance sheets of corporations. GM is hoping to improve its junk bond rating for borrowing going forward. [...] [...] In a mad scramble to stem its $105 billion reported losses in 2005, GM announced today it will unload its profitable GMAC lending unit to Cerberus Capital Management LP for about $14 billion. That’s helpful to stem the bleeding, but far from the final answer on needed restructuring for GM. For example, as we reported last week, its pension obligations alone remain $35 billion under-funded, which takes their overall balance sheet from $14 billion in the black to $16 billion in the red should GAAP accounting be updated as proposed to require pensions to be fully held as the liabilities they are on the balance sheets of corporations. GM is hoping to improve its junk bond rating for borrowing going forward. [...]

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