GM forced to take a $39B charge

0 Comments | USA TODAY, November, 2007 | by Sharon Silke Carty

DETROIT -- General Motors announced late Tuesday that it is taking a $39 billion charge in its third-quarter earnings to stay in compliance with accounting laws that say a company can't keep booking tax credits if it doesn't have a track record of making money.

GM was already expected to post a weak third quarter this morning. The massive charge, its largest one-time charge ever, will force the quarter deeper into the red.

GM stressed in its announcement that the charge doesn't affect its cash or its ability to operate.

Chief Financial Officer Fritz Henderson said in the statement that GM's long-term outlook remains the same. "GM continues to believe that its new product introductions, combined with the new GM-UAW labor agreement, once fully...