Alternative Performance Measures and ESMA Guidelines: Improving Stakeholders’ Communication

  •  Francesca Magli    
  •  Alberto Nobolo    
  •  Matteo Ogliari    


In a world more interconnected and globalized, the Entities periodically communicate to stakeholders, and in general to market, their performances and results. The Entities use, in their financial communication, Alternative Performance Indicators (APM) that are not required by accounting principles.  APM are increasingly used by Entities to help provide insights on performance. These indicators are a financial measure of historical or future financial performance, financial position, or cash flows, other than a financial measure defined or specified in the applicable financial reporting framework. This study aims to analyse the spread of APM, investigating the financial communications of Listed Italian Industrial Entities on FTSE-MIB index 40. As APM have become more widespread, their reporting has turned out to be an hot topic around the world for prepares, stakeholders, auditors and regulators. The European Securities and Markets Authority issued new guidelines that aim to improve the usefulness and transparency of Alternative Performance Measures. In the second part, the study aims to analyse how the Entities expects to apply these new guidelines and the impacts on financial communication.

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