4.8 Non-GAAP Measures on the Face of Financial Statements and Notes
Item 10(e)(1)(ii)(C) expressly prohibits a registrant from
presenting non-GAAP measures in financial statements prepared in accordance with
GAAP. Accordingly, a registrant may not present non-GAAP measures in either of the
following places:
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The face of the financial statements.
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The footnotes accompanying the financial statements.
However, the SEC staff has clarified that it would not object to the
inclusion of an additional non-GAAP measure of segment profit or loss in the segment
footnote, as long as the measure is disclosed in accordance with ASC 280-10-50-28B
and 50-28C (added by ASU 2023-07) and meet the presentation and disclosure
requirements of Regulation G and Item 10(e) (see Section 3.1 for a discussion of those
requirements). For additional information, including a discussion of segment
disclosures that may be prohibited, see Section 2.5.
Item 10(e)(1)(ii)(D) also prohibits a registrant from presenting
non-GAAP measures on the face of any pro forma financial statements required to be
disclosed by Regulation S-X, Article 11.