Feds proposing new rules on ‘pro forma’ reporting

Wednesday, Oct. 30, 2002 | 11:16 a.m.

WASHINGTON -- The Securities and Exchange Commission today proposed making companies that release "pro forma" financial results explain how those numbers differ from earnings that comply with U.S. accounting standards.

Pro forma figures, which often exclude one-time costs such as merger expenses to show what companies call their "core performance," were used in press releases issued by 1,500 companies last year, before they filed official reports.

The rule proposal, approved today by the SEC on a unanimous vote, now goes out for public comment before a final SEC vote. In January, Trump Hotels & Casino Resorts Inc., led by developer Donald Trump, settled SEC fraud charges that the company issued misleading pro forma results.

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