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I find it wonderful that the IASB lets these non-GAAP shenanigans continue to be. They could easily create a much larger distinction between GAAP and non-GAAP a
by wjnc 3y ago
I find it wonderful that the IASB lets these non-GAAP shenanigans continue to be. They could easily create a much larger distinction between GAAP and non-GAAP accounting, for instance by requiring a stronger separation in the presentation of different measures. Accountants can’t be very happy with yearly changing non-GAAP definitions that are “ment to” increase comparability but actually serve mostly to give boards a feeling that they have influence over presentation of how they think it is, instead of presentation of how it is.
- ethbr1 3y ago>> When Equinix transitioned to become a REIT in 2015, it began using AFFO as a key metric in determining executive bonuses. That same year, Equinix reported a sudden 47% drop in maintenance CapEx, leading to an estimated 19% boost to reported AFFO. Also, is it common to use non-GAAP, accounting-dependant measures to compensate executives? At best, this seems like a strategic conflict of interest (bonuses vs good for the business) without an impenetrable firewall around the CFO's org. And even then, sets up an adversarial dynamic where everyone is against the CFO. I get any bonus metric will be juiced, but that's why metrics that are less game-able are used.