Accounting Changes Aid Hammond : Finance: Company reports a profit of $412,000 for fiscal 1990; it lost nearly $1.1 million the year before.

Taking advantage of two significant accounting changes that enabled it to boost its income, the Hammond Co. reported a $412,000 profit for its fiscal 1990, contrasted with a net loss of nearly $1.1 million for the previous year.

But the publicly owned mortgage banking firm’s financial statement shows that without the $535,000 it gained in the third quarter from the accounting changes, it would have lost $122,517 for the year ended March 31.

Hammond officials say, however, that the company fared well in a year in which real estate sales throughout the United States fell substantially from the record levels established in prior years. The company’s sales for 1990 were down 3% to $19.8 million, from $20.4 million a year earlier.

The fiscal 1990 operating loss was only half the operating loss of the previous year, said John Bastis, Hammond’s executive vice president and chief financial officer.

Bastis said the company’s 1989 loss was the result of several unusual factors including a one-time, $450,000 loss from the company’s failed attempt to acquire a savings and loan and a $400,000 loss from unpaid mortgage insurance claims.

Without those items, Bastis said, Hammond’s 1989 result would have been a $225,000 loss, or slightly more than twice the fiscal 1990 operating loss.

For fiscal 1990, Hammond adopted new accounting procedures that allowed it to reduce its reserves for federal income taxes and to book the net savings as a one-time gain of $281,000 and to realize a one-time gain of $254,000 by changing the way it depreciates the value of income from loan servicing contracts.

Bastis said Hammond has been able to pare its losses in the midst of a sales downturn by trimming operating expenses.

For fiscal 1990, he said, Hammond realized considerable savings by closing seven money-losing offices. The company operates 16 offices, including a new one recently opened in Sacramento.

For the fourth quarter, the company lost $451,490, contrasted with a year-earlier loss of $855,684. Sales dipped slightly to $4 million from $4.1 million a year earlier.