SEC Reg G Non-GAAP
Authoritative Source
Adjusted EBITDA
EBITDA adjusted for non-recurring expenses, stock-based compensation, and M&A integration costs.
Detailed Definition & Corporate Finance Context
Adjusted EBITDA serves as a vital financial metric in corporate FP&A, treasury management, and institutional valuation. Governed by SEC Reg G Non-GAAP, monitoring Adjusted EBITDA allows CFOs and finance leaders to optimize capital allocation, refine financial forecasts, and communicate performance to investors.
In enterprise corporate FP&A models and ERP financial planning suites (Oracle NetSuite PBCS, SAP Analytics Cloud, Anaplan), tracking Adjusted EBITDA provides real-time visibility into operational margin efficiency and cost structure leverage.
Mathematical Standard & Equation
Adjusted EBITDA = Net Income + Taxes + Interest + D&A + Non-Recurring Add-Backs
Common Operational Pitfalls
- Conflating reported GAAP net income with cash flow generated from core operations.
- Failing to normalize non-recurring add-backs when calculating adjusted EBITDA metrics.
- Relying on static annual budgets rather than rolling 12-month FP&A forecasts.