According to a January 18th statement by the US Securities and Exchange Commission (SEC), General Motors Company (GM) is expected to pay $1 million in order to settle an accounting case related to a defective ignition switch, that caused 124 deaths and 275 injuries. Charges stated that lax accounting control at GM had caused the company not to properly determine the possible financial impact of the faulty ignition switch. The automaker has agreed to the administrative SEC order, while, at the same time, it neither denied, nor admitted the allegations.
General Motors shares closed higher for the first time in the past four trading sessions on Wednesday. The stock went up 0.43% ($0.16) to $37.47, with the daily high and the daily low being at $37.58 and $37.12 respectively. In the week ended on January 15th the shares of the vehicle manufacturer added 3.75% to their market value compared to a week ago, which marked the second consecutive period of gains and also the best performance since the week ended on December 11th. The stock has extended its advance to 7.55% so far during the current month, following a 0.90% increase in December. The latter has been a second straight month of gains. For the entire 2016, General Motors shares added 2.44%.
“Internal accounting controls at General Motors failed to consider relevant accounting guidance when it came to considering disclosure of potential vehicle recalls”, Andrew Calamari, director of the SECs New York Regional Office, said, cited by Reuters.
Vehicle manufacturers need to determine the probability of “whether the potential recall will occur, and provide an estimate of the associated loss or range of loss or otherwise provide a statement that such an estimate cannot be made”, the SEC said in its Wednesday statement.
The regulatory authority also noted that the internal investigation over the problematic ignition switch had not been disclosed to General Motors accountants until November 2013, regardless of the fact other personnel at the company had become aware of a potential safety issue in the spring of 2012.
The biggest car maker in the United States has suffered ignition switch-related costs of over $2 billion, while also reserving billions more in relation with 2014 and 2015 vehicle recalls.
Daily and Weekly Pivot Levels
With the help of the Camarilla calculation method, todays levels of importance for the General Motors stock are presented as follows:
R1 – $37.51
R2 – $37.55
R3 (Range Resistance – Sell) – $37.60
R4 (Long Breakout) – $37.72
R5 (Breakout Target 1) – $37.87
R6 (Breakout Target 2) – $37.93
S1 – $37.43
S2 – $37.39
S3 (Range Support – Buy) – $37.34
S4 (Short Breakout) – $37.22
S5 (Breakout Target 1) – $37.07
S6 (Breakout Target 2) – $37.01
By using the traditional method of calculation, the weekly levels of importance for General Motors Company (GM) are presented as follows:
Central Pivot Point – $37.12
R1 – $38.38
R2 – $39.42
R3 – $40.68
R4 – $41.94
S1 – $36.08
S2 – $34.82
S3 – $33.78
S4 – $32.74