Canadian securities regulators on Friday released proposed new requirements for financial statements and other continuous disclosure by public companies. The proposal incorporates changes made in response to public and industry input on the original proposal published last year.
The proposed rule — National Instrument 51-102 Continuous Disclosure Obligations — would establish enhanced, consistent disclosure standards across Canada.
It deals with financial statements, management’s discussion and analysis, reporting of material changes and significant business acquisitions (a new requirement), annual information forms, executive compensation disclosure, shareholder meeting circulars, restricted share disclosure requirements and some other filing requirements.
“This new rule should benefit both issuers and investors,” said Stephen Sibold, chair of the Canadian Securities Administrators, in a news releases.
“A uniform set of requirements reduces the cost and complexity that public companies face today in trying to satisfy different standards in various provinces and territories,” Sibold added.
Changes from the original proposal include:
- a concept of “venture issuer” that replaces a variety of categories of junior or small issuers;
- streamlined requirements for business acquisition reporting; and
- clarification of the process for determining when, and to which investors, disclosure documents must be sent.The CSA is requesting comments by August 19.