AT&T Inc. plans to take a pre-tax charge of $2.7 billion in the fourth quarter because of a change in how it accounts for gains and losses for pensions and other retirement benefits.
The huge telecommunications company said Thursday the charge amounts to 28 cents per share, and added that the charge is driven by a reduction of the benefit plan discount rate to 5.8 percent from 6.5 percent.
AT&T said it will now recognize gains and losses for pension and other retirement benefits in the year they are incurred. Previously it recognized them over many years.
The company added it expects the accounting change to result in "simpler, more transparent financial results by linking results directly to current market returns, interest rates and healthcare costs."
AT&T said the changes will not affect its cash flow or pension funding requirements.
© Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.