SEC Urges Caution on Non-GAAP Numbers in New Segment Rules

Companies planning to use new US accounting rules allowing them to put unofficial earnings metrics in their segment footnotes need to check with the Securities and Exchange Commission first, an agency top accountant said Tuesday.

“We encourage you to come talk to us about the SEC staff’s expectations,” Lindsay McCord, chief accountant in the SEC’s Division of Corporation Finance, said during an American Institute of CPA’s accounting conference in Washington.

McCord’s unusual announcement about checking with the SEC staff about a new accounting standard also included a reminder about SEC rules on non-GAAP measures. Any extra profit measure a company ...