A method of making polycarbonate includes the steps of forming polycarbonate by a melt transesterification method using an activated diaryl carbonate, and compounding the polycarbonate with a phosphorus-containing compound that has an abstractable proton or hydrolyzable group. The phosphorus-containing compound is compounded with the polycarbonate in an amount sufficient to result in an improvement in the color properties of the polycarbonate as compared to pellets formed from the same polycarbonate without addition of the phosphorus-containing compound.