ROCHESTER, N.Y.-- Eastman Kodak Company has adjusted its previously announced third-quarter 2005 loss, on the basis of generally accepted accounting principles in the U.S. (GAAP), primarily because of accounting errors involving restructuring accruals associated with severance and special pension-related termination benefits. The errors, which represent non-cash items, total $15 million after tax. While the $15 million of restructuring-related adjustments increased the company's third-quarter loss, they also reduced the losses recorded in the first and second quarters of 2005 by an equivalent amount because the adjustments should have been recorded in the first and second quarters. There is no effect on periods prior to 2005. In addition, the company increased the previously reported gain on the third-quarter sale of real estate by approximately $6 million after tax. The $6 million gain on the real-estate sale does not affect any prior periods. As a result of all of these adjustments, the company's third-quarter loss increased by $9 million, to $1.038 billion, from the previously reported loss of $1.029 billion. On a year-to-date basis, the adjustments in total, including the increased gain on real estate, decreased the GAAP loss by $6 million after tax. Kodak reported final results for the third quarter of 2005 in its Form 10-Q, which was filed today with the Securities and Exchange Commission. The company also filed today a Form 8-K with the SEC indicating that it will restate its previously issued financial statements for the first and second quarters of 2005 through the filing of amended Form 10-Qs for the first and second quarters of 2005. "As we have previously said, the magnitude of the worldwide restructuring program the company is undertaking imposes significant challenges to ensure the appropriate accounting," said Robert H. Brust, Chief Financial Officer and Executive Vice President, Eastman Kodak Company. "While we are deeply committed to the highest standards of accounting, the act of reducing employment by more than 15,000 people thus far, in more than 40 countries, and dealing with a variety of labor laws and severance plans, creates the opportunity for errors in the numerous entries that must be made. We continue to improve our financial controls, and the detection of these errors is evidence of the effectiveness of this effort. "Nonetheless, as a result of the severance-related error, the company is disclosing that it has an internal control deficiency that constitutes a material weakness that impacted the accounting for restructurings," Brust said. "The error itself involves an incorrect calculation of a severance accrual for one employee, the only such error out of approximately 6,000 employee reductions made this year. Given that, we fully expect to remediate this material weakness by the end of the year."