By Yakubu LAAH InvestAdvocate

Lagos (INVESTADVOCATE)- World securities regulators, the International Organisation of Securities Commissions (IOSCO) on Monday said its seeking input on its proposed statement on Non-GAAP Financial Measures intended to assist issuers in providing clear and useful disclosure for investors and other users of non-GAAP financial measures, and to help reduce the risk that such measures are presented in a way that could be misleading.

IOSCO in a statement made available to InvestAdvocate said the Non-GAAP Financial Measures also sets out its expectations for issuers with respect to their presentation of financial measures other than those prescribed by Generally Accepted Accounting Principles (GAAP).  

The global securities regulator affirmed that Non-GAAP Financial Measures can be useful to issuers and investors because they can provide additional insight into an issuer’s financial performance, financial condition and/or cash flow.  “The use of non-GAAP financial measures also can provide issuers with flexibility in communicating useful, entity-specific information,” IOSCO said. 

It further affirmed that problems can arise, however, when non-GAAP financial measures are presented inconsistently, defined inadequately, or obscure financial results determined in accordance with GAAP. 

IOSCO said non-GAAP financial measures typically lack a standardised meaning and thus are generally not comparable from one issuer to the next.

The sought input is expected to reach the IOSCO’s board on or before December 05, 2014.