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8120 Definition of a Non-GAAP Financial Measure
us SEC - Financial Reporting Manual
8120.1 A non-GAAP financial measure is a numerical measure of a registrant's historical or future financial performance, financial position, or cash flow that:
a. excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of comprehensive income, balance sheet or statement of cash flows of the issuer; or
b. includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable GAAP measure so calculated and presented.
8120.2 Some common examples of measures that meet the definition of non-GAAP measures include the following: (Last updated: 3/31/2013)
a. Funds from operations (FFO) (Non-GAAP C&DI Questions 102.01 and 102.02)
b. EBIT / EBITDA / adjusted EBITDA (Non-GAAP C&DI Questions 102.09, 103.01 and 103.02)
c. Adjusted revenues
d. Broadcast cash flow (BCF)
e. Free cash flow (FCF) (Non-GAAP C&DI Question 102.07)
f. Core earnings
g. Measures presented on a constant-currency basis (e.g., revenues, operating expenses, etc.) (Non-GAAP C&DI Question 104.06)
8120.3 Measures of operating performance or statistical measures that fall outside the scope of the definition set forth above are not "non-GAAP financial measures". Additionally, "non-GAAP financial measure" excludes financial information that does not have the effect of providing numerical measures that are different from the comparable GAAP measure. Examples of measures that are not non-GAAP financial measures include:
a. Operating and statistical measures (such as unit sales, number of employees, number of subscribers).
b. Measures of profit or loss and total assets for each segment that are consistent with disclosures made in accordance with ASC Topic 280. (Non-GAAP C&DI Questions 104.01 through 104.06)
c. Disclosure of expected or contracted indebtedness.
d. Disclosure of amounts of repayments that have been planned but not yet made.
e. Disclosure of estimated revenues or expenses of a new product line (so long as the amounts were estimated in the same manner as would be computed under GAAP). (Non-GAAP C&DI Question 104.05)
f. Financial measures that are required to be disclosed by a system of regulation of a governmental authority or self-regulatory organization that is applicable to the registrant (such as different levels of capital required by banks). (Non-GAAP C&DI Question 102.12) (Last updated: 10/30/2020)
g. Ratios or statistical measures that are calculated using exclusively one or both of:
1. financial measures calculated in accordance with GAAP (such as earnings per share); and
2. operating measures or other measures that are not non-GAAP measures (such as dollar revenues per square foot for hotels, same store sales, and revenues per slot machine for casinos, assuming that sales/revenues for each measure is based on GAAP numbers).
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