Emerson Electric Co. filed a Current Report on Form 8-K on October 13, 2026, announcing a change in its accounting method for defined benefit pension and other postretirement benefit plans. The company will adopt a mark-to-market accounting method, effective for the fiscal year ended September 30, 2026. Under the new method, actuarial gains and losses will be recognized in earnings in the period in which they arise, rather than being amortized into net periodic benefit cost over subsequent periods.
The company stated that the new method is preferable under U.S. generally accepted accounting principles (U.S. GAAP) because it improves the transparency of results by reflecting current economic conditions and plan experience in the period in which they occur. It also better aligns the measurement of pension expense with fair value principles.
Emerson expects to record a pretax gain of less than $5 million in the fourth quarter of fiscal 2026 based on current actuarial assumptions. This adjustment will be excluded from adjusted earnings per share (EPS) because it is subject to significant variability and is not considered indicative of underlying operating performance. The company also noted that the adoption of the new method increased earnings for the nine months ended June 30, 2026, by $8 million ($6 million after-tax, or $0.01 per share), due to the reversal of amortized losses from accumulated other comprehensive income.
The filing includes supplemental unaudited recast historical financial information for the years ended September 30, 2024, and 2025, as well as results for the nine months ended June 30, 2026. The company noted that the information in the exhibit does not represent a restatement of previously issued financial statements.
