Unisys Corp – ‘10-K’ for 12/31/97 – EX-18

As of:  Friday, 3/20/98   ·   For:  12/31/97   ·   Accession #:  950109-98-1907   ·   File #:  1-08729

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Annual Report   —   Form 10-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K        Annual Report                                         20     75K 
 2: EX-12       Computation of Ratio of Earnings to Fixed Charges      1      7K 
 3: EX-13       Portions of Annual Report 12/31/97                    29    175K 
 4: EX-18       Letter Re: Change in Accounting Principles             1      8K 
 5: EX-21       Subsidiaries of Unisys Corporation                     1      7K 
 6: EX-23       Consent of Independent Auditors                        1      8K 
 7: EX-24       Power of Attorney                                      2±    10K 
 8: EX-27       Financial Data Schedule                                2      9K 

EX-18   —   Letter Re: Change in Accounting Principles

EX-18
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EXHIBIT 18                                                                      

January 15, 1998                                                                

Mr. Lawrence A. Weinbach                                                        
Chairman, President and Chief Executive Officer                                 
Unisys Corporation                                                              
P.O. Box 500                                                                    
M.S. A-1                                                                        
Blue Bell, PA 19424                                                             

Dear Mr. Weinbach:                                                              

Note 3 to the Consolidated Financial Statements of Unisys Corporation (the      
"Company") included in its 1997 Annual Report to Stockholders, to be            
incorporated by reference in its Form 10-K for the year ended December 31,      
1997, describes a change in the method of accounting for measuring goodwill     
impairment.  Prior to the change, when impairment indicators existed, goodwill  
was evaluated for impairment and any impairment would have been measured based  
on comparing the unamortized goodwill to projected undiscounted operating       
results.  Under the Company's new accounting method, any impairment of          
goodwill indicated by such comparison would be measured by discounting          
projected cash flows using a discount rate commensurate with the risks          
involved. You have advised us that you believe that the change is to a          
preferable method in your circumstances because when a goodwill impairment      
must be recognized, the discounted cash flow method is a better measurement of  
the remaining value of goodwill, particularly considering the rapid changes     
that continue to occur in the marketplace away from the proprietary technology  
and maintenance businesses, and the continuing declines in revenue and margins  
in these businesses.                                                            

There are no authoritative criteria for determining a `preferable' method of    
measuring the impairment of goodwill based on the particular circumstances;     
however, we conclude that the change in the method of measuring the impairment  
of goodwill by discounting projected cash flows is to an acceptable             
alternative method which, based on your business judgment to make this change   
for the reasons cited above, is preferable in your circumstances.               

Very truly yours,                                                               

/s/ Ernst & Young LLP                                                           
Philadelphia, Pennsylvania                                                      

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘10-K’ Filing		Date		Other Filings
Filed on:		3/20/98
		1/15/98		8-K
For Period End:		12/31/97
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