DETROIT, June 25 (Reuters) - General Motors Co said on Thursday it will incur a $600 million charge on its second-quarter net profits because of a change in the way it values Venezuelan currency.
GM’s controller, Tom Timko, told investor analysts on a conference call that the company was switching to system that values the Venezuelan currency at 200 to a dollar rather than its previously used system using a rate of 13 to the dollar.
“We do not expect this decision to have an impact on our Venezuelan or South American operating results, nor do we believe it will affect our 2015 free cash flows,” Timko said.
Under standard U.S. accounting, operating results do not take into account extraordinary charges such as those stemming from currency changes, while net profits do.
Reporting by Bernie Woodall Editing by W Simon