The OSC and Non-GAAP Measures

question 89

Essay

The OSC and non-GAAP measures
In an effort to curb to potential confusion created by non-GAAP earnings discussed in Exercise 4-111, the OSC has issued a staff notice on these disclosures. Briefly explain what this notice states issuers should do. Why do you think the OSC is particularly interested in streamlining these disclosures?

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Definitions:

Foreign Exchange Risk

The risk that an entity’s financial position, financial performance, or cash flows will be affected by fluctuations in exchange rates.

Recognised Assets

Assets that have been formally acknowledged and recorded on the balance sheet due to their probable future economic benefits.

Unrecognised Firm Commitments

Obligations or agreements that a company has committed to, but are not yet recorded on the balance sheet because they do not meet the recognition criteria.

Hedge Effectiveness

A measure of the degree to which a hedge transaction reduces the risk of the underlying exposure it was intended to hedge.