International Organization of Securities Commissions updates statement on non-GAAP financial measures disclosure

The International Organization of Securities Commissions has published an updated Statement on Non-GAAP Financial Measures, aimed at helping issuers provide clearer and more useful disclosure for investors and other users, and reducing the risk that non-GAAP measures are presented in a misleading way. The statement updates IOSCO’s 2016 and 2002 guidance and reiterates that GAAP financial statements provide a defined basis for analysis and comparability, while issuers may also use alternative performance measures. It notes that non-GAAP measures can provide additional insight into performance, financial condition and cash flow, but can create problems where they are presented inconsistently, defined inadequately, or obscure GAAP results, and often lack a standardised meaning that supports comparability across issuers.