SEC looking at issue of non-GAAP metric abuse
by Francine McKenna
The Securities and Exchange Commission is taking another step to crack down on corporate use of numbers that the agency fears deceives investors.
The SEC’s Division of Corporation Finance is forming an internal task force to closely review the use of “non-GAAP” numbers and whether companies respond to recently updated guidance on using these metrics.
So-called comment letters will go to companies that don’t comply with the new guidance in their second quarter earnings releases.
The SEC’s corporation finance division issues comment letters to companies to request additional supplemental information or request a revision in its filing with the agency.