We recently had a post on this blog about non-GAAP financial metrics, and how the Securities and Exchange Commission has kept one wary eye on companies using non-GAAP measures so gratuitously they harm the investment community. Well, we have another voice harping on those abuses again, with a bit more clarity about exactly what regulators don’t want to see.

Today’s critic is Wesley Bricker, deputy chief accountant at the SEC, who just gave a speech at the Baruch College Financial Reporting Conference on a range of financial reporting issues. The whole thing is worth reading, but he aimed particular fire at non-GAAP metrics that present revenues “adjusted” to the point that they’ve departed from the intent of the original GAAP rule.

Bricker minced no words: “As [SEC] staff monitors current practices and implementation of the new revenue standard, we will be looking to see if the reporting concepts within those standards are supplanted by any number of company-specific non-GAAP alternatives… If you present adjusted revenue, you will likely get a comment; moreover, you can expect the staff to look closely, and skeptically, at the explanation as to why the revenue adjustment is appropriate.”

Bricker’s specific complaint was that companies will present adjusted revenue numbers based on accounting principles that don’t reflect the companies’ actual business. For example, if you sell subscriptions, you bill a year’s subscription in January and then recognize revenue one month at a time throughout the year. That’s GAAP. But if the company adopts a metric reporting revenue as if it sold a product, and recognized all that revenue on Jan. 1—well, that’s a different accounting principle. It’s perfectly fine if you sell products, but Bicker’s example company sells subscriptions, so it’s a non-GAAP metric that deviates from providing useful information to investors in that subscription-sales company.

So who is providing non-GAAP, adjusted revenue numbers? We dove into our database of S&P 500 disclosures and found some examples (plus the non-GAAP revenue they reported in 2015):

• Activision Blizzard: $4,621,000,000
• Analog Devices: $3,435,092,000
• Broadcom Ltd.: $6,905,000,000
• Citizens Financial Group: $4,824,000,000
• Coca Cola: $44,257,000,000
• EMC Corp.: $24,780,000,000
• Endo International: $3,268,718,000
• EQT Corp.: $1,051,405,000
• Exelon Corp.: $29,237,000,000
• Fidelity National Information Services: $6,642,700,000
• Intuitive Surgical: $2,384,400,000
• Invesco Ltd.: $886,100,000
• Keycorp: $1,416,000,000
• Mondelez International: $28,009,000,000
• Regions Financial: $5,325,000,000
• Stericycle Inc.: $2,569,600,000
• Under Armour Inc. (expressed in % growth): 30.80%
• Vertex Pharmaceuticals: $410,355,000
• Zoetis Inc.: $4,765,000,000

In fairness, some of these companies report non-GAAP adjusted revenue that is down from revenue under plain GAAP. Which is a little strange, but variety is the spice of life. Calcbench subscribers can dig into the particulars for these companies in our Company in Detail page.

That’s not to say the SEC will bar these companies (or anyone else) from reporting non-GAAP revenue metrics outright. For more than a decade, the agency has been clear that non-GAAP metrics are permissible if you can explain why your non-GAAP number is useful—both to investors and, apparently, to SEC staff who will probably send you a comment letter asking for details. Here is another example of non-GAAP reporting that provides more detail:

Clearly Bricker is firing yet another shot across the bow of corporate financial departments that non-GAAP metrics should only be used because they’re necessary, not because you feel like it.