{"id":1428,"date":"2019-01-03T12:51:01","date_gmt":"2019-01-03T17:51:01","guid":{"rendered":"https:\/\/seci.wpenginepowered.com\/?p=1428"},"modified":"2019-01-03T12:51:01","modified_gmt":"2019-01-03T17:51:01","slug":"non-gaap-fines-yes-dont-forget-equal-or-greater-prominence","status":"publish","type":"post","link":"https:\/\/seciblog.pli.edu\/index.php\/non-gaap-fines-yes-dont-forget-equal-or-greater-prominence\/","title":{"rendered":"Non-GAAP Fines?  Yes! Don\u2019t Forget \u201cEqual or Greater Prominence\u201d!"},"content":{"rendered":"<p>On December 26, 2018, the SEC levied a fine on a company that failed to follow the <a href=\"https:\/\/www.ecfr.gov\/cgi-bin\/text-idx?SID=8e0ed509ccc65e983f9eca72ceb26753&amp;node=17:3.0.1.1.11&amp;rgn=div5#se17.3.229_110\">Regulation S-K Item 10 (e)<\/a>\u00a0guidance concerning the use of non-GAAP measures.\u00a0 Specifically, the company did not present the most directly comparable GAAP measure with <strong>equal or greater prominence\u00a0<\/strong>in the headline and highlights in two of its earnings releases.<\/p>\n<p>As you can <a href=\"https:\/\/www.sec.gov\/litigation\/admin\/2018\/34-84956.pdf\">read about here<\/a>, the issue was aggravated because while the company touted increases in non-GAAP measures such as adjusted EBITDA, which showed \u201cprofitability\u201d in the headline and highlights of its earnings releases, the comparable GAAP measure, net loss, had actually worsened.<strong>\u00a0 It clearly raises concerns when a non-GAAP measure shows profitability and the comparable GAAP measure shows a loss and where the measures are moving in different directions<\/strong>.<\/p>\n<p>The company agreed to pay a fine of $100,000.<\/p>\n<p>As always, your thoughts and comments are welcome!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>On December 26, 2018, the SEC levied a fine on a company that failed to follow the Regulation S-K Item 10 (e)\u00a0guidance concerning the use of non-GAAP measures.\u00a0 Specifically, the company did not present the most directly comparable GAAP measure with equal or greater prominence\u00a0in the headline and highlights in two of its earnings releases. &hellip; <a href=\"https:\/\/seciblog.pli.edu\/index.php\/non-gaap-fines-yes-dont-forget-equal-or-greater-prominence\/\" class=\"more-link\">Continue reading <span class=\"screen-reader-text\">Non-GAAP Fines?  Yes! Don\u2019t Forget \u201cEqual or Greater Prominence\u201d!<\/span> <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[242],"tags":[],"coauthors":[154],"class_list":["post-1428","post","type-post","status-publish","format-standard","hentry","category-reporting"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts\/1428","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/comments?post=1428"}],"version-history":[{"count":0,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts\/1428\/revisions"}],"wp:attachment":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/media?parent=1428"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/categories?post=1428"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/tags?post=1428"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/coauthors?post=1428"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}