Innovation Update
Fannie Mae Completes Restatement
TSC Staff
12/06/06 - 06:32 PM EST
Fannie Mae (FNM Quote) filed its long-awaited Form 10-K for 2004 and completed its restatement, saying $6.3 billion in past retained earnings will be wiped out.
The Congressionally chartered mortgage company said losses through Dec. 31, 2004, associated with its accounting for derivatives totaled $7.9 billion. However, that was nearly $3 billion less than it had previously estimated.
Stockholders' equity increased by $4.1 billion through June 30, 2004, despite the decline in retained earnings.
The accounting fiasco led Fannie Mae to part ways with CEO Franklin Raines late in 2004. Earlier this year, a probe led by former Sen. Warren Rudman determined that Raines wasn't aware Fannie Mae's accounting didn't agree with generally accepted principles.
Then, in May, the company reached a deal with the Office of Federal Housing Enterprise Oversight and the Securities and Exchange Commission to pay $400 million to end an investigation into its accounting errors.
Before Wednesday, the company hadn't filed an annual report with regulators in nearly three years.