Area Development News Desk (03/05/2009)
Auditors for General Motors (GM) say they have "substantial doubt" that
the company will be able to continue operations, according to the
company's annual report. The accounting firm Deloitte & Touche LLP
raised the concerns, citing recurring losses from operations,
stockholders' deficit, and the ongoing inability to generate sufficient
cash to meet financial obligations. "There is no assurance that the
global automobile market will recover or that it will not suffer a
significant further downturn," the company said in its report. GM says
its ongoing survival depends on its ability to execute the
reorganization plan it submitted to the Treasury Department last month,
and that if it is not successful, the company could potentially be
required to file for Chapter 11 bankruptcy protection. The Associated
Press reports that GM has previously stated that only the federal
government could provide enough financing for a Chapter 11
reorganization and that the worst-case scenario would cost the
government up to $100 billion. GM has received $13.4 billion in federal
loans and is seeking a total of $30 billion as part of the auto
industry bailout.
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