TEXT OF STORY
Steve Chiotakis: The nation’s biggest — and arguably most financially-strapped — carmaker unveils the balance sheet for its first full quarter out of bankruptcy. GM’s earnings were delayed two weeks while the automaker polished its bookkeeping. But wait, that sounds a little odd, considering GM is starting with a clean slate. Here’s Marketplace Senior Business Correspondent Bob Moon.
Bob Moon: GM has promised for nearly a year to reinvent itself:
GM COMMERCIAL: General Motors needs to start over in order to get stronger. Reinvention is the only way we can fix this. And fix it we will.
Now, thanks to something auditors call “fresh-start accounting,” GM gets to adjust its debts and assets in a way that can help a company just out of bankruptcy put a positive spin on its balance sheet.
Analyst David Silver at Wall Street Strategies says it means GM can ignore past performance:
David Silver: The old GM really isn’t comparable to what we have today. They got rid of the majority of their debt, they got rid of their health care costs. So they’re really a much healthier company than they were, say, this time last year.
Silver says today’s report is a big step toward making GM attractive as a publicly-traded company again. The Obama administration has made no secret of its desire to sell the government’s 60 percent stake.
Silver: They gave a lot of money to General Motors, and they’re really anxious to prove that it worked. That’s why they’re so anxious to really put the best face forward, to work to get this IPO, and really get the taxpayers’ money back.
That initial public offering could come later this year, according to GM and federal officials.
I’m Bob Moon for Marketplace.
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