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CAROLINA FREIGHT CORPORATION CHANGES ACCOUNTING METHOD FOR RECOGNIZING REVENUE

 CAROLINA FREIGHT CORPORATION CHANGES ACCOUNTING
 METHOD FOR RECOGNIZING REVENUE
 CHERRYVILLE, N.C., Feb. 26 /PRNewswire/ -- Carolina Freight Corporation (NYSE: CAO) announced today it has changed its accounting method for recognizing revenue. Effective Jan. 1, 1992, Carolina began recognizing revenue on a percentage-of-completion basis while continuing to recognize expenses when incurred. The effect of this accounting change will be a one-time nonoperating charge of $1.8 million to after-tax earnings in the first quarter. Since the first quarter will absorb the cumulative effect of this accounting change, subsequent quarters in 1992 will reflect only the incremental quarter-to-quarter change in deferred revenue. It is important to note that the accounting change will have no impact on the Company's cash flow.
 The Emerging Issues Task Force (EITF) of the Financial Accounting Standards Board recently reviewed the various methods used by the transportation industry to recognize revenue and expenses. The EITF concluded that the accounting policy of recognizing revenue when the shipment is picked up from the customer and expenses when incurred is no longer acceptable. Carolina had been recording revenue and expenses on this basis since before it became a public company. the EITF decision, which applies to all transportation companies, will affect a number of motor carriers besides Carolina.
 Carolina Freight Corporation is a holding company whose operating subsidiaries, Carolina Freight Carriers Corporation, Red Arrow Freight Lines, Inc., G.I. Trucking Company, Cardinal Freight Carriers, Inc. and Complete Leasing Concepts, Inc. provide freight transportation services coast to coast and to select foreign markets. Corporate revenue for the 52 weeks ending Dec. 31, 1991, was $769,150,000.
 -0- 2/26/92
 /CONTACT: Shawn W. Poole, Treasurer, Carolina Freight Corporation, 704-435-6811/
 (CAO) CO: Carolina Freight Corporation ST: North Carolina IN: TRN SU:


DF -- CH005 -- 3008 02/26/92 17:21 EST
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Publication:PR Newswire
Date:Feb 26, 1992
Words:298
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