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2007 General Motors Annual Report
Jim Dollinger
Monday, May 26, 2008
Once you get past the glossy photos and glowing PR, hold tight as you reach for the bi-focals or magnifying glass. Sit down for the shocker!
"A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis.
"Material weaknesses previously identified as of December 31,2006 that continue to exist as of December 31,2007:
"1. Controls over the period-end financial reporting process were not effective. This has resulted in a significant number and magnitude of out-of-period adjustments to our consolidated financial statements and in previously reported restatements. Specifically, controls were not effective to ensure that significant non-routine transactions, accounting estimates, and other adjustments were appropriately reviewed, analyzed, and monitored by competent accounting staff on a timely basis. Additionally, some of the adjustments that have been recorded relate to account reconciliations not being performed effectively..."
"2. Controls to ensure our consolidated financial statements comply with IRS No, 109, "Accounting for Income Taxes" were not effective..."
"3. Controls over the accounting for employee benefit arrangements were not effective. We lacked sufficient control procedures as well as adequate involvement of technical accounting resources to ensure that employee benefit arrangements were accounted for properly"
"Based on our assessment, and because of the material weaknesses described above, we have concluded that our internal control over financial reporting was not effective as of December 31, 2007"
G. Richard Wagoner
WHO IS RICK WAGONER?
How in the hell did he get the job in the first place? Why was he chosen to be Chief Financial Officer at such a young age, leapfrogging others with vastly more knowledge, seniority, and experience? The man didn't even have an accounting degree. Who has been pulling him up thru the ranks even while he accomplished virtually nothing along the way? There must be a reason. Step back, take an honest look, examine the facts, and you will wonder...exactly who is this guy and why is he running the show even after losing more billions in shareholder value than was lost on Enron? Time to WAKE UP!
As to accounting rules, they are made to be followed and if a multi national, multi billion corporation can't do it there is a problem within said corporation. Making excuses for Red Ink Rick doesn't change SEC mandated language disclosed in the fine print. Words like material combinations of deficiencies, misstatements, not maintained, not effective are quite serious concerns and have been going on for years under RIR. The impact of this man's disastrous tenure has communities suffering as taxes are lowered and jobs are lost, policemen laid off, fire stations shuttered, schools closed, crime rising, families splitting apart.
Once again I am calling for the ouster of Red Ink Rick. How much worse might things be than are disclosed in the financials? How many more Billions in losses must we endure as a result of this man's mismanagement and incompetence?
"In our opinion, because of the effect of the material weaknesses described above on the achievement of the objectives of the control criteria, the Corporation has not maintained effective material control over financial reporting as of December 31, 2007"
Deloitte & Touche LLP
WHO IS DELOITTE & TOUCHE?
Deloitte, the same outfit that was auditor for Parmalat. Remember them, European conglomerate that imploded with a $5 Billion Cayman Island cash account that DID NOT EXIST? We've had the same audit company for over 70 years, hardly the appearance of an arm's length relationship. How about the Jersey car dealer McNamara who burned us for $400 Million in vans which did not exist? Where was Deloitte then?
Deloitte was found guilty of dereliction of duty regarding Adelphia.
Before anyone heard of Enron, Just For Feet, a Super Bowl ad running shoe store chain went from a market cap of $700 Million to ZERO in three years with Deloitte's accountants on watch. Deloitte's consulting arm hit the company up for business to fix it's internal control problems. Can you say "conflict of interest?" Instead of blowing the whistle, they sought additional business.
WHO IS JOHN GALT?
"But it cannot be done to you without your consent. If you permit it to be done, you deserve it.
"You, who are half-rational, half-coward, have been playing a con game with reality, but the victim you have conned is yourself. When men reduce their virtues to the approximate, then evil acquires the force of an absolute, when loyalty to an unyielding purpose is dropped by the virtuous, it's picked up by scoundrelsand you get the indecent spectacle of a cringing, bargaining, traitorous good and a self-righteously uncompromising evil."
Ayn Rand "Atlas Shrugged"
Now ask yourself...
WHO IS THE BIG FISH PULLING THE STRINGS ON RED INK RICK?
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