Amend - Fitch: GMAC & ResCap Remain on Watch Evolving On Accounting Issues.NEW YORK -- This is a correction for a previous message. It corrects the first sentence of the press release, which erroneously states that GMAC GMAC General Motors Acceptance Corporation GMAC Graduate Management Admission Council GMAC Give Me A Call GMAC Genetic Manipulation Advisory Committee GMAC Genetic Modification Advisory Committee (Singapore) GMAC Give Me A Chance and ResCap remain on Rating Watch Negative. The ratings for General Motors Acceptance Corp. (GMAC) and its wholly-owned subsidiary Residential Capital Corp. (ResCap) remain on Rating Watch Evolving by Fitch Ratings following the announcement that GMAC will delay filing their SEC form 10-K(s) and will be required to either restate or reclassify Verb 1. reclassify - classify anew, change the previous classification; "The zoologists had to reclassify the mollusks after they found new species" class, classify, sort out, assort, sort, separate - arrange or order by classes or categories; "How would you certain items in prior financial statements to address a recently surfaced accounting issue. The issue pertains to the erroneous classification of cash flows from certain mortgage loan transactions as either cash flows from operations or cash flows from investing activities. This reclassification Reclassification The process of changing the class of mutual funds once certain requirements have been met. These requirements are generally placed on load mutual funds. Reclassification is not considered to be a taxable event. will not impact reported net income, balance sheet or total cash flows for the periods affected. The issue is material for ResCap, however, it still undetermined whether this will be material for GMAC. The companies have not indicated the size of the potential accounting issue at this time. While Fitch is concerned that the companies did not properly apply appropriate GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). related to the associated cash flows from loan originations, Fitch does not believe that what amounts to a reclassification of these cash flows is analytically significant and thus, by itself, will not have any effect on the current ratings or Rating Watch status. Fitch's concern would be heightened if the companies are not able to complete the filing process within the next two weeks. The following ratings remain on Rating Watch Evolving by Fitch: GMAC -- L-T Issuer Default Rating (IDR IDR In currencies, this is the abbreviation for the Indonesian Rupiah. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. ) 'BB'. ResCap -- L-T Issuer Default Rating (IDR) 'BBB-'. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. of such ratings are available on the agency's public site, 'www.fitchratings.com'. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
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