In "Having More Meaningful and Effective Communications with Stakeholders During COVID-19" (FEI), Deloitte senior consultation partner Eric Knachel offers sound financial reporting and investor communications guidance for near-term reporting periods, as COVID-19 continues to impact nearly every organization differently and - in many cases - significantly.
Among other takeaways, Knachel advises companies to carefully consider/reconsider non-GAAP measures, some of which may have previously been based on seemingly unusual and non-recurring costs (e.g., PPE, cleaning and disinfecting costs) - costs that may now be characterized as consistent with the "new normal" and thus not suitable for non-GAAP treatment. Other pandemic-related costs, however, such as impairments, facility shutdowns, contract terminations, employee termination costs, government grants, and insurance recoveries, are likely to become more prevalent as the pandemic continues and - subject to company-specific circumstances and judgment - may appropriately be characterized as "one-time" transactions and factored into the company's non-GAAP results.
Access additional resources on our Financial Reporting page » Coronavirus (COVID-19). This post first appeared in the weekly Society Alert!