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ARCO ADOPTS FINANCIAL ACCOUNTING STANDARDS NOS. 106 AND 109 RETROACTIVE TO JAN. 1, 1992

 LOS ANGELES, Jan. 20 /PRNewswire/ -- ARCO (NYSE: ARC) announced today that it will adopt two new accounting standards retroactive to Jan. 1, 1992.
 The company is taking action to meet requirements for publicly held companies to adopt Statement of Financial Accounting Standards (SFAS) No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions," and SFAS No. 109, "Accounting for Income Taxes," no later than the first quarter of 1993.
 The cumulative effect of adopting the new standards will be recognized by restating first quarter 1992 net income to reflect a one-time charge of $392 million after tax, or $2.43 per share. A charge of $435 million after tax for the adoption of SFAS No. 106 was partially offset by a credit of $43 million related to the adoption of SFAS No. 109.
 Excluding the cumulative effect of adopting the two standards, the effect on 1992 net income will not be material. Neither adjustment will affect the company's cash flow. ARCO's 1992 financial results are scheduled to be released on Monday, Jan. 25.
 SFAS No. 106 requires companies to accrue the actuarially determined costs of postretirement benefits, other than pensions, during the years that the employee renders the necessary service. ARCO's previous practice was to recognize the expense as incurred.
 SFAS No. 109 is a modification of SFAS No. 96, which ARCO previously adopted in 1990. This allows the company greater flexibility in recognizing deferred tax assets.
 -0- 1/20/93
 /CONTACT: Albert Greenstein of ARCO, 213-486-3384/
 (ARC)


CO: ARCO ST: California IN: OIL SU:

JL-EH -- LA006 -- 6824 01/20/93 11:01 EST
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Publication:PR Newswire
Date:Jan 20, 1993
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