Verizon (NYSE: VZ) is going to have to take a $600 million hit in its 2010 full year earnings because of a change in the way it reports pension benefits, reports Reuters.
The service provider, which will report its Q4 earnings next Tuesday, is realigning its pension accounting to recognize gains and losses during the year they are incurred versus amortizing them over time. This move will simplify the view of its accounts for current investors.
However, Verizon is not alone in taking this action, nor is realigning pension accounting reporting isolated to the telecom industry either. AT&T (NYSE: T) reported last week that it would take a $2.7 billion non-cash charge in its Q4 2010 earnings.
Outside of the telecom industry, other corporations such as Honeywell (NYSE: HON), GE (NYSE: GE), and IBM (NYSE: IBM), which have also reworked their pension accounting practices.
For more:
- Reuters has this article
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AT&T takes $2.7 billion charge in Q4 from pension accounting change