In comments today, the American Bankers Association said it does not support a proposal by the Financial Accounting Standards Board to establish and track a standardized set of financial key performance indicators for businesses.
A financial KPI is a measure calculated or derived from the financial statements and/or underlying accounting records not presented in Generally Accepted Accounting Principles, or GAAP, financial statements, according to FASB. The board late last year invited comment on whether to establish a standardized set of financial KPIs and whether that information should be disclosed in financial statements.
ABA is opposed to the proposal. Among other things, the association noted that stakeholders already receive the information they need through the disclosure of non-GAAP measures. It also said that codification of “non-GAAP” measures may create confusion regarding the well-established framework currently employed by the Securities and Exchange Commission for non-GAAP disclosures, and that the FASB will not have the necessary resources to perform the ongoing surveillance necessary to continually monitor and maintain an up-to-date list of financial KPIs.
“While GAAP provides a firm base of consistent and robust financial information for users, investors greatly benefit from non-GAAP information tailored to specific industries or entities,” ABA said. “Attempting to develop uniform definitions across all industries would introduce unnecessary complexity and could reduce the relevance of the resulting measures for end users.”
