Akron (Ohio), Oct 23: Goodyear Tire & Rubber Co. plans to restate earnings for the past five years, decreasing income by as much as $100 million because of accounting system errors. The nation's largest tire maker also said yesterday it was delaying the release of its third-quarter earnings until mid-November. Results were supposed to have been released today morning.
Shares closed up 2 cents to $6.83 on the New York Stock Exchange before the announcement, but in after-hours trading, shares plummeted 27 per cent, or $1.83. In a statement released after the market closed, Goodyear said an accounting system implemented in 1999 caused errors with its billing system, resulting in mistakes it is now identifying and correcting.
The accounting system was used to track the purchase of equipment for factories, Goodyear spokesman Keith Price said. The company had no further details other than what was in the statement, he said, declining to reveal when the errors were discovered. Goodyear moved quickly to disclose and correct the problems, he said. "We have a proud history of doing the right thing," Price said.
The accounting errors do not affect the company's cash flow or access to credit, Goodyear said. Bureau Report