The U.S. Securities and Exchange Commission (SEC) charged KBR with inflating a key, non-financial statement performance metric known as work in backlog, which informs investors of the amount of revenue a company expects to receive in the future on contracts. According to the SEC, in the second quarter of 2012, KBR improperly included $459 million in its publicly disclosed backlog for a pipe fabrication and modular assembly contract with a Canadian energy company, even though KBR had not actually received—and the counterparty was not obligated to provide—any orders under the contract. The SEC found KBR continued to overstate its backlog for almost two years. KBR agreed to pay a $2.5 million penalty to settle the SEC’s charges.