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GE TO ADOPT FAS 112, ACCOUNTING FOR EMPLOYEE BENEFITS, IN SECOND QUARTER

 FAIRFIELD, Conn., July 2 /PRNewswire/ -- General Electric Company today announced that it would adopt Statement of Financial Accounting Standards (Statement) No. 112, "Employers' Accounting for Postemployment Benefits," in the second quarter of 1993. This Statement, which must be adopted by all companies in 1994, requires that employers expense the costs of postemployment benefits (as distinct from postretirement pension, medical and life insurance benefits) over the working lives of employees. The principal effect for GE is to change the method of accounting for severance benefits. Under the company's previous accounting policy, the total cost of severance benefits was expensed when the severance event occurred.
 The initial effect of adopting FAS 112 will be reflected by means of a


one-time, after-tax charge of $862 million ($1.01 per share). There will be no cash flow impact from this charge to earnings.
 As required by accounting standards, GE's first quarter 1993 net earnings will be restated for the cumulative charge. After restatement, the previously reported first quarter net earnings of $1,160 million ($1.36 per share) will be reduced for the effect of the accounting change to $298 million ($.35 per share).
 The company expects to announce record second quarter 1993 earnings per share which will be higher than the $1.53 average of analysts' estimates.
 -0- 7/2/93
 /CONTACT: Bruce Bunch of General Electric Company, 203-373-2039, or at home, 203-263-5595/
 (GE)


CO: General Electric Company ST: Connecticut IN: SU:

SH -- NY004 -- 8056 07/02/93 09:00 EDT
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Publication:PR Newswire
Date:Jul 2, 1993
Words:248
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