General Electric (GE) to Recast 2016/2017 Financials Under New Standard; No Impact on 2018 Guidance

General Electric (NYSE: GE) said it will be recasting 2016 and 2017 financial statements to report them under the new standard. The new standard has no impact on 2018 guidance, the company said.

From the company:

Fellow investors,

As previously disclosed, we will be reporting our first quarter 2018 earnings, scheduled for April 20th, under the new revenue recognition accounting standard (ASU No. 2014-09, Revenue from Contracts with Customers).

All public companies are required to adopt this standard. We chose to adopt it on a retrospective basis. This means we will be recasting our 2016 and 2017 financial statements to report them under the new standard. The new standard has no impact on our 2018 guidance.

The recasted financial information will also reflect the following changes:

• A new pension standard, ASU No. 2017-07, which required a change in the presentation of non-operating pension costs on the income statement.
• A new cash flows related standard, ASU No. 2016-18, which resulted in a reclassification of restricted cash balances.
• A new cash flows related standard, ASU No. 2016-15, which resulted in a reclassification of certain securitization related cash inflows to be reclassified from operating activities to investing activities.
• A new income tax related standard, ASU No. 2016-16, which eliminates the deferral of the tax effects of intra-entity asset transfers other than inventory.
• Other changes to simplify our financial reporting and better align it with others in our industry.

This is an important transition process, and it is taking more time than we originally expected to finalize. We plan to provide recasted financial information by April 13th.

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