• SEC ADOPTS FINAL RULE REGARDING USE OF NON-GAAP FINANCIAL MEASURES
  • May 15, 2003
  • Law Firm: Akin Gump Strauss Hauer & Feld LLP - Office
  • Of recent concern to the federal government is the disclosure by public companies of financial information based on calculations not in accor-dance with - or which obscure - generally accepted accounting principles (GAAP). The concern is that financial information that is not in accordance with GAAP (and often is not in accordance with any standard at all) could be misleading. In April 2001 the National Investor Relations Institute (NIRI) and Financial Executives International (FEI) issued a joint statement providing guidance on this practice. In December 2001 the SEC endorsed the NIRI/FEI recommendations, and has since taken certain enforcement actions relating to the issuance of such information. In addition, the SEC regularly comments on the press releases of companies that issue such information.