Thinking About a New or Updated Non-GAAP Financial Measure for COVID-19? Look Before You Leap.

17 April 2020
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Key takeaways:

  • As a result of the ongoing COVID-19 pandemic, companies may be considering whether and how to adjust GAAP and/or existing non-GAAP financial measures to reflect the impact of COVID-19. Although relevant considerations will vary by company, there are a number of key U.S. federal securities law, contractual and governance considerations:
    • Confirm how to reflect an adjustment in compliance with applicable U.S. federal securities laws, including general antifraud provisions.
    • Evaluate contractual provisions to determine whether an adjustment is permitted under material agreements and evaluate the possible consequences of the adjustment.
    • Assess governance requirements to determine whether an adjustment complies with internal policies and procedures and confirm that the adjustment is subject to robust internal controls.