FMA to consult on the use of alternative performance measures

Media Release
11 November 2011

The Financial Markets Authority (FMA) will issue draft guidance for public consultation in 2012 on the use of alternative performance measures (APMs) by financial markets issuers.

"The use of APMs such as 'underlying profit' and 'normalised profit' in public documents including annual reports, market announcements and transaction documents is becoming increasingly common in New Zealand. These measures can provide useful information to investors, but they also have the potential to be misleading if used to mask bad news," said Elaine Campbell, Head of Compliance Monitoring.

"FMA intends to release for consultation a draft regulatory guide on disclosing APMs. We have commenced initial discussions with market participants and we encourage those with an interest in financial reporting to join the debate," Ms Campbell said.

An outline of the approach FMA will take to guidance can be found here.