Ford Restates Five Years of Results

The automaker revises its third-quarter results, narrowing its loss by $550 million.
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Ford Motor

(F) - Get Report

filed restated results for 2001 to 2005 Tuesday to correct accounting for certain derivative transactions.

The No. 2 U.S. automaker also revised its results for the third quarter, narrowing its loss for the period by about $550 million. The company now has a loss of $5.2 billion for the third quarter, compared with its

Oct. 23 estimate of a loss of $5.8 billion.

The improvement primarily reflected the effect of a change in accounting for Ford's credit division's interest rate swaps.

That results for the quarter still remain far worse than those from Ford's Detroit rival

General Motors

(GM) - Get Report

. Both Ford and GM have struggled in recent years as they deal with cost burdens and loss of market share to foreign competitors. GM, however, has managed to post strong improvements this year, while Ford is still struggling to reap the benefits of its restructuring plan.

As for Ford's restatements, the cumulative effect of the move boosted net income by about $850 million.

Ford restated its results after discovering that certain interest rate swaps that Ford Credit had entered into did not satisfy the specific accounting requirements that would have exempted these transactions from periodic assessments of their effectiveness.

Ford found that it had a material weakness in its internal controls in relation to the hedging accounting, but said that weakness has been fully remediated.