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Accounting Change Helps Ford Post Big Profit

January 27, 2012

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January 27, 2012

Ford announced Friday that it made $13.4 billion in the fourth quarter. The large gain was attributed to an accounting change. Without the accounting gain, Ford earned $1.1 billion, which meant it fell short of Wall Street expectations.

STEVE INSKEEP, HOST:

NPR's business news starts with a sign of confidence at Ford.

The Ford Motor Company is out with its latest earnings report, and the automaker says it made almost $13.5 billion in the fourth quarter of last year. That is thanks mostly to an accounting change. Ford moved some tax assets back onto its books. It has created a reserve fund; set some money aside in effect back in 2006 when the company was falling on hard times. Getting rid of the reserve now is considered a signal that Ford believes that it expects to continue to be profitable in years to come.

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