Mobil Adopts New Accounting Standards Statement
Dam, George Van, THE JOURNAL RECORD
New York City-basedMobil Oil Corp. announced that in its reporting for the third quarter of 1988, it will adopt the Statement of Financial Accounting Standards No. 96 (FAS 96), Accounting for Income Taxes.
In adopting this standard, Mobil will restate its 1986, 1987 and first half 1988 financial statements. There will be no effect on Mobil's cash flow or actual income tax liabilities, according to company officials.
The FAS 96 accounting change reduces Mobil's retained earnings as of June 30, from the previously reported $15.9 billion to $14.34 billion.
Reduction in 1986 earnings primarily reflects the recording of a deferred tax liability for the difference between the purchase price and the tax basis of Mobil's 1984 acquisition of The Superior Oil Co.
This is offset somewhat by a $552 million benefit resulting from reductions in income tax rates in the United States and Canada; and other benefits of $205 million, principally a reduction in ongoing deferred tax expense because of a partial reversal of the Superior tax liability.
The improvements in restated 1987 and first half 1988 income relate primarily to the reduction in deferred tax expense related to Superior. . .
- Searching for diamonds in the Upper Peninsula of Michigan might add some glitter to an area internationally known for its mining of copper and iron-ore.
Dow Chemical Co. of Midland, Mich. and Crystal Exploration Inc. of Denver, have recently began their search for diamonds with the discovery of seven kimberlite pipes - volcanic rock shafts where diamonds are found.
The pipe formations are in a 40-mile area around Iron Mountain and Crystal Falls, on the western end of the Upper Peninsula.
Core drilling has unearthed a scattering of sand-grain sized diamonds, which are too few and too small for commercial production, but the search is still young.
In the few places Kimberlite pipes are found, they usually occur in clusters of up to several dozen, said James Huml, a Dow research associate.
Dow recently sold its mineral leases and geological data to Crystal Exploration Inc., a Colorado subsidiary of Sydney, Australia's Restech International Ltd.
Occasional diamond finds on Ohio farms in the late 19th century and early 20th century turned geologists' heads north for a source area.
A northern source was given additional creedence based on scientific evidence that volcanoes were active in the upper peninsula almost 200 million years ago and possibly generated the heat and compressional forces to form diamonds. …