The Ontario Securities Commission’s continuous disclosure team has issued a staff notice indicating that revised financial statements must be publicly announced. It has set up a website to highlight offside issuers.

In June 2000, the OSC announced the creation of a continuous disclosure review program to ensure compliance with periodic and timely disclosure requirements, as well as to improve the quality of disclosure generally. Since then, it has reviewed the continuous disclosure records of numerous issuers and some of these reviews have resulted in issuers amending and refiling financial statements or other documents.

In certain limited cases, the reviews were resolved through the issuer agreeing to restate financial information for previous periods retroactively in their next set of financial statements. This was done in order to correct an error in the statements that have already been filed with the commission.

“When an issuer amends and refiles a document previously filed with the commission, or implements an accounting change on a retroactive basis in order to correct an error, it is our view that these are significant events that should be generally disclosed to the market,” states the notice.

“We remind issuers that it is their responsibility to ensure that the details of any amended and refiled information, or retroactive accounting change that represents the correction of an error, are clearly and broadly disclosed to the market in a timely manner. This responsibility is the same whether the refiling or change is made in the context of a staff review or at any other time.”

A news release should clearly describe the revisions to the previously filed information and the reasons for making the changes. This should be released in a way that ensures it is widely and publicly disseminated and a copy should be concurrently provided to the
commission. Finally, the documents that are amended and refiled should be clearly labelled as “revised” or “restated”, should identify and describe the nature of the revisions and, in the case of refiled financial statements or MD&A, should be filed under the applicable “amended” document type on SEDAR.

On October 25, 2002, it started posting a Refilings and Errors list on the commission’s Web site. Any deficiency in an issuer’s disclosure record that is identified during a staff review and that leads to a refiling will result in that issuer being placed on the Refilings and Errors list.