Compliance into the Weeds-Episode 65-The Trouble with Non-GAAP Metrics
What is non-GAAP?
The Financial Accounting Standards Board (FASB) was quite active at the end of 2023 and published two notable Accounting Standards Updates (ASUs) that are expected to meaningfully affect public company disclosures regarding...more
In response to the COVID-19 epidemic, the U.S. government has provided relief to companies through various grant programs. The receipt of these grant proceeds represents a meaningful lifeline to many companies and the...more
This edition provides an overview of key regulatory developments in the past three months relevant to companies listed, or planning to list, on The Stock Exchange of Hong Kong Limited (HKEx), and their advisers. In...more
The SEC’s Division of Enforcement recently instituted cease-and-desist proceedings against a company for violating Section 13(a) of the Exchange Act and Rule 13a-11 by including non-GAAP financial measures in two of its...more
Before the SEC shutdown, the Office of the Investor Advocate published the annual report on its activities during 2018. ...more
In a cease-and-desist order dated December 26, 2018, the Securities and Exchange Commission enforced rules regarding the disclosure of non-GAAP financial measures, resulting in a $100,000 penalty to the violating issuer. With...more
The SEC brought a settled enforcement action against ADT Inc. because it did not afford equal or greater prominence to comparable GAAP financial measures in two of its earnings releases containing non-GAAP financial...more
For public companies with a December 31, 2018, fiscal year-end, new hedge accounting rules will become effective on January 1, 2019. The FASB issued the new hedge accounting guidance on August 28, 2017, through Accounting...more
In a recent speech, Commissioner Kara Stein addressed a number of disclosure related concerns, including cyber disclosures and ESG disclosures. Just as many of us had been reading about a decline in the number of SEC Staff...more
A couple of years ago, the SEC made a big push—through a series of staff oral admonitions and written guidance, as well as one enforcement action—toward requiring issuers to be more transparent and more consistent in the use...more
Public midstream oil and gas entities continue to face ever-increasing complexity related to filing financial statements that are compliant with GAAP and the U.S. Securities and Exchange Commission (SEC). The SEC has been...more
Under the current rules of the US Securities and Exchange Commission (SEC), foreign issuers are allowed to use International Financial Reporting Standards (IFRS) financial statements in their registration statements and...more
On October 16, 2017, Clermont Partners released a survey on the reliance of active investors on non-GAAP versus GAAP reporting, intangible assets and non-financial metrics. Unlike passive investors who invest in index funds,...more
This year’s American Institute of Certified Public Accountants Conference on SEC and PCAOB Developments, held on December 5-7, echoed several themes from prior AICPA conferences regarding regulatory priorities of interest to...more
Companies commonly supplement their reported earnings under U.S. generally accepted accounting principles (GAAP) with non-GAAP financial measures that they believe more accurately reflect their results or financial position...more
Judging by the frequency of recent news reports and SEC staff speeches focused on non-GAAP financial measures, audit committees may be well served to take a fresh look at the non-GAAP measures reported by their companies and...more
In the wake of the Enron scandal and the dot-com bust in 2003, the SEC adopted Reg G and related amendments to Reg S-K to prevent public disclosure of misleading non-GAAP financial measures. Among other things, these rules...more