On December 13, 2022, the Securities and Exchange Commission’s Division of Corporation Finance issued new and revised Compliance and Disclosure Interpretations regarding the use of non-GAAP financial measures by reporting companies in public disclosures and SEC filings. The new C&DIs note several examples of non-GAAP financial measures that the SEC staff views as potentially misleading, recognition and measurement principles inconsistent with GAAP, inadequate labels and descriptions and improper prominence of non-GAAP financial measures. In addition, in the revised guidance, the SEC clarifies that a non-GAAP measure could be misleading to such a degree that even extensive, detailed disclosure would not prevent the non-GAAP measure from being materially misleading. The updated guidance reflects the continued focus by the SEC and the Staff on public companies’ use of potentially misleading non-GAAP financial measures.