Called to Account: This company found a unique way to skirt SEC accounting rules

Videogame maker Activision Blizzard is playing a numbers game with its earnings reports that seems to directly flout Securities and Exchange Commission rules.

The Santa Monica, Calif.–based company ATVI, +0.13% received a letter from the SEC in 2016, telling it to drop revenue deferrals from its non-GAAP numbers — earnings-report figures that do not comply with Generally Accepted Accounting Principles, or GAAP. The company is instead asking journalists to make a calculation so that they will in turn provide the regulator-prohibited adjusted revenue number to investors.

The letter came after the SEC last year issued renewed guidelines for companies on the use of non-GAAP measures, which companies say help them provide extra information to investors and strip out one-time items such as litigation- or merger-related charges.

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