SEC Issues New Guidance for GAAP Reconciliations of Financial Projections in Merger Proxies


On April 4, 2018, the SEC staff issued guidance in Questions 101.02 and 101.03 to clarify that issuers are not required to provide GAAP reconciliations for financial projections provided to financial advisors even if the projections are also provided to the issuer’s board of directors. The SEC staff also clarified that non-GAAP reconciliations are not required for forecasts exchanged between the parties in a business combination transaction that the issuer later discloses to comply with anti-fraud and other securities laws.