The Financial Accounting Standards Board (FASB) has released an invitation to comment (ITC) on financial key performance indicators (KPIs), inviting feedback by 30 April 2025.

The ITC aims to gather stakeholder opinions on perceived issues related to financial KPIs, which are financial measures derived from financial statements but not presented in GAAP financial statements.

This includes measures based on amounts presented in the financial statements, adjusted amounts and calculations derived from other information in the financial statements or financial records.

Prepared at the direction of the FASB chair, the ITC is part of FASB’s research project on financial KPIs for business entities.

It seeks to determine whether to add a project on financial KPIs to FASB's technical agenda.

It does not express preliminary views but aims to gather input to inform potential project objectives and scope.

Feedback from previous outreach, including the 2021 Agenda Consultation, highlighted diverse stakeholder views on the perceived issues and the need for a project on financial KPIs.

Some stakeholders advocate for increased transparency in financial statements rather than standardisation of financial KPIs.

ITC states that: “To better understand the perceived issues related to the increase in Financial KPIs, the FASB staff researched the prevalence of entities reporting Financial KPIs. From 2013 to 2022, the proportion of SEC filers reporting a Financial KPI increased from 36% to 53%. Among the S&P 500, which reflects large public companies, the increase was from 65% to 85% over the same period.

“Those increases in Financial KPI reporting also were present across most industry sectors. From 2013 to 2022, all but one industry (drugs, soaps, perfumes and tobacco) saw double digit growth in the presentation of Financial KPIs.”

Earlier this month, FASB issued an Accounting Standards Update (ASU) to enhance financial reporting transparency.

This ASU responds to investor demands for detailed expense information in public companies' financial statements.

"FASB seeks feedback from stakeholders on financial KPIs " was originally created and published by The Accountant, a GlobalData owned brand.

 

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