Financial reports sample-Use of NON-GAAP（非公认会计准则） measures

（Edited by freelance Chinese translator li – English to Chinese translation or Chinese to English translation services- financial report translation）

Use of NON-GAAP（非公认会计准则） measures
In the discussion of operating results, Yara refers to certain non-GAAP financial measures including EBITDA（未计利息、税项、折旧及摊销前的利润） and CROGI（总投资现金回报率）. Yara’s Management makes regular use of these measures to evaluate the performance, both in absolute terms（绝对项） and comparatively from period to period（期间比较）. These measures are viewed by management as providing a better understanding - both for management and for investors - the underlying（潜在的/根本的） operating results of the business segments for the period under evaluation. Yara manages long-term debt and taxes on a group basis. Therefore, net income is discussed only for the Group as a whole.

Yara’s management model（管理模式）, referred to as Value Based Management（价值导向管理）, reflects management’s focus on cash flow-based performance indicators（绩效指标）. EBITDA, which Yara defines as income/(loss) before tax, interest expense, foreign exchange gains/losses, depreciation, amortization and writedowns（减计/减值/划减）, is an approximation（近似值） of cash flow from operating activities before tax and net operating capital changes. EBITDA is a measure that in addition to operating income, also includes interest income, other financial income, and results from equity accounted investees（按权益法核算的被投资人/被投资公司）. It excludes depreciation, writedowns and amortization, as well as amortization of excess values（超出数） in equity accounted investees. Yara’s definition of EBITDA may differ from that of other companies.

EBITDA should not be considered as an alternative（替代指标） to operating income and income before tax（税前收入） as an indicator of the company’s operations in accordance with generally accepted accounting principles. Nor is EBITDA an alternative to cash flow from operating activities in accordance with generally accepted accounting principles.

Yara management uses CROGI (Cash Return On Gross Investment) to measure performance. CROGI（总投资现金回报率） is defined as gross cash flow, divided by average gross investment and is calculated on a 12-month rolling basis（滚动方式）. “Gross cash flow”（总现金流量） is defined as EBITDA less total tax expense, excluding tax on net foreign exchange gains/ losses. “Gross Investment”（总投资） is defined as total assets (exclusive of deferred tax assets, cash and cash equivalents, other liquid assets and fair value adjustment recognized in equity) plus accumulated depreciation（累计折旧） and amortization, less all short-term interest-free liabilities（无息负债）, except deferred tax liabilities（递延所得税负债）.

In order to track underlying（潜在的/实际的/真实的） business developments from period to period, Yara’s management also uses a variance analysis methodology, developed within the Company (“Variance Analysis”), that involves the extraction of financial information from the accounting system, as well as statistical and other data from internal management（内部管理） information systems. Management considers the estimates produced by the Variance Analysis, and the identification of trends based on such analysis, sufficiently precise（足够精确） to provide useful data to monitor our business. However, these estimates should be understood to be less than an exact quantification（精确量化） of the changes and trends indicated by such analysis.