The Federation of European
Accountants (Fédération des Experts-comptables Européens, FEE) has responded to
the International Organization of
Securities Commissions (IOSCO) consultation on non-GAAP financial
measures. FEE calls for the efforts around non-GAAP measures to be coordinated
with the IASB.
In an opening statement before
commenting directly on the IOSCO
proposals, FEE expresses support for improvements in corporate reporting and
stresses that non-GAAP measures play an important role as they can improve the
communication between the entity and its stakeholders as long as they are
reported in a transparent and unbiased manner. Nevertheless, FEE
"identifies that there is a lack of coordination between market oversight
bodies and regulators on one hand and the IASB on the other hand, which leads to
a high degree of divergence in practice. FEE expressly references the ESMA
consultation on alternative performance measures, but recently also the IFAC
has issued guidance on supplementary financial measures. FEE states:
We believe that the International
Accounting Standards Board (“IASB”) should also be involved in the reporting of
Non-GAAP Measures in the context of financial reporting. Some IFRSs currently
include guidance on how an entity can present Non-GAAP Measures within its
financial statements. Therefore, [...] FEE suggests all the market oversight
bodies and regulators (international, regional and national) to work with the
IASB in order to develop a common comprehensive framework on Alternative
Performance Measures/Non-GAAP measures.
The IASB has a disclosure
initiative on its agenda that is split into several smaller projects. The
project on principles of disclosure considers information that should be
included in a complete set of financial statements and the presentation of
non-IFRS information and comparative information. A discussion paper is
currently expected in the second quarter of 2015.
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