Non-GAAP earnings:
A) could be considered management's view of permanent earnings.
B) are needed for the correction of errors.
C) are standardized under generally accepted accounting principles.
D) are useful to compare two different firms' performance.

Question

Quizplus · Accepted Answer

Non-GAAP earnings are a measure of a company's financial performance that does not comply with generally accepted accounting principles (GAAP). These earnings are often used by management to show what they believe to be the company's true earnings, which can be considered their view of permanent earnings. Non-GAAP earnings are not standardized under GAAP, so comparing two different firms' performance using non-GAAP earnings can be misleading.

Non-GAAP Earnings