CICA publishes guidance for reporting non-GAAP measures, EBITDA and Free Cash Flow

    TORONTO, Feb. 19 /CNW/ - The Canadian Institute of Chartered Accountants
(CICA), through its Canadian Performance Reporting Board (CPRB), has published
guidance for reporting financial measures outside of Generally Accepted
Accounting Principles (GAAP), specifically Earnings Before Interest, Taxes,
Depreciation and Amortization (EBITDA) and Free Cash Flow.
    These measures are widely used by preparers, but few rules govern their
construction and disclosure. The lack of standards makes it difficult for
investors and analysts to compare performance between entities.
    "Financial reporting has become very complex," says Dave Pollard, Vice
President of Knowledge Development at CICA. "The CICA is responding to
investors who have requested more standardization and disclosure in reporting
non-GAAP financial measures. "
    The CICA believes the standardization and enhanced disclosure provided in
this guidance will improve financial reporting and make it easier to compare
entities. This would be especially helpful in today's financial reporting
environment where analysts' reports are demanded immediately after publication
of an entity's results.
    "Free Cash Flow and EBITDA are widely used non GAAP financial measures
which do not have accepted definitions", says CPRB member Fred Pynn, CA,
President and Chief investment Officer of Bissett Investment Management. "The
CPRB guidance defines the calculation of Free Cash Flow and EBITDA which will
lead to increased comparability of these measures between firms. Additionally
the guidance allows flexibility in reporting these measures, providing
management with the opportunity to highlight company specific issues. Further,
additional contextual information is also required that will that will aid
users in assessing Free Cash Flow and EBITDA."
    Improved Communication With Non-GAAP Financial Measures - General
Principles and Guidance For Reporting EBITDA and Free Cash Flow is published
for comment until April 30, 2008. The document can be obtained from CICA's
Performance Reporting Resource Centre at

    The Canadian Institute of Chartered Accountants (CICA), together with the
provincial, territorial and Bermuda Institutes/Ordre of Chartered Accountants,
represents a membership of approximately 72,000 CAs and 10,000 students in
Canada and Bermuda. The CICA conducts research into current business issues
and supports the setting of accounting, auditing and assurance standards for
business, not-for-profit organizations and government. It issues guidance on
control and governance, publishes professional literature, develops continuing
education programs and represents the CA profession nationally and
internationally. CICA is a founding member of the International Federation of
Accountants (IFAC) and the Global Accounting Alliance (GAA).

For further information:

For further information: or to arrange an interview, contact: Tobin
Lambie, Media Manager, CICA, (416) 204-3228,

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