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The SEC’s most recent non-GAAP enforcement action has triggered new calls for companies to adopt non-GAAP policies if they haven’t already. That’s partly because, as John blogged, the SEC raised the company’s alleged failure to adopt disclosure controls & procedures specific to non-GAAP measures. If you’re looking to adopt a non-GAAP policy, or revamp your existing policy, consider these tips from Gibson Dunn’s Securities Regulation and Corporate Governance Monitor:

Companies Should Have Disclosure Controls and Procedures in Place to Identify and Disclose Non-GAAP Adjustments. It is crucial for accounting, legal and other personnel responsible for public reporting to be familiar with SEC reporting requirements as they pertain to non-GAAP measures, and the company’s disclosure controls and procedure documentation should specifically address steps and controls in place to identify amounts relevant for non-GAAP adjustments and make non-GAAP disclosures. Employee determinations of non-GAAP adjustments should be guided by, and evaluated in light of, such disclosure controls and procedures and any other non-GAAP policies that a company determines may be appropriate to adopt. In addition, policies and procedures should be designed to help ensure the accounting and legal departments are able to engage in a thorough review and approval process of proposed non-GAAP adjustments, with a view to accuracy, consistency and overall compliance.

Descriptions of Non-GAAP Measures Should Be Kept Consistent with Actual Accounting Practices. To be effective, companies’ disclosure controls and procedures should include processes designed to help ensure that non-GAAP financial measures and adjustments are described accurately in periodic filings, earnings releases and other public statements. Companies should routinely assess whether the descriptions of non-GAAP measures used historically continue to be consistent with their actual accounting practices for identifying, reviewing and approving non-GAAP adjustments.

An Active and Engaged Disclosure Committee Should Be Part of the Control Environment. An important lesson of the SEC’s order is the need for coordinated oversight of non-GAAP and other disclosures across a company’s various departments to promote a consistent and accurate disclosure control environment. An active and engaged disclosure committee should play a prominent role in reviewing and commenting on non-GAAP disclosures. The disclosure committee should also periodically review the disclosure controls and procedures with respect to non-GAAP disclosure to ensure they remain up-to-date, consistent with the company’s actual business practices, and accurate overall.

As John noted, the first article in the March-April issue of “The Corporate Counsel” newsletter is “Non-GAAP Financial Measures: The Pendulum Swings.” In my book, this is also required reading to prevent, to quote the article, non-GAAP “backsliding”!

– Meredith Ervine