The Financial Accounting Standards Board (FASB) is taking aim at the confusing array of non-GAAP financial measures that companies use to report their performance, seeking to bring order to a system that has long frustrated investors and analysts.
In a move to improve transparency and comparability across companies, the board on November 14, 2024, issued an Invitation-to-Comment (ITC) No. 2024-ITC100, Financial Key Performance Indicators for Business Entities, as part of research efforts to standardize certain non-GAAP financial metrics commonly reported in earnings releases. The board is seeking input on how to define and report financial key performance indicators, or KPIs, which are based on financial results but aren’t reflected in official Generally Accepted Accounting Principles (GAAP) financial statements.
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