National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure will:

• Apply to all reporting issuers, except investment funds and certain foreign issuers;
• Apply to non-reporting issuers for certain offering documents and transactions;
• Require specified disclosure for certain financial measures presented outside the financial statements, such as non-GAAP financial measures and supplementary financial measures, (as defined in the final rule); and
• Apply to disclosures for a financial year ending on or after October 15, 2021 (for reporting issuers) and for certain offering documents or transactions filed after December 31, 2021 (for non-reporting issuers). 

The final rule incorporates feedback to clarify and streamline the application and disclosure requirements. Prior to adopting the final rule, issuers should continue to refer to Staff Notice 52-306 (Revised) Non-GAAP Financial Measures, which will be withdrawn when transition to the final rule is complete. The final rule will come into effect on August 25, 2021.

Review the press release on the CSA's website and National Instrument 52-112 on the OSC's website.

The questions covered included:

• Given that different cryptocurrencies carry different risks, how do financial executives decide which ones we want to be associated with and which ones to avoid?
• What are the key accounting and tax capabilities that their systems need to accommodate to account for crypto?
• What are the key accounting and tax considerations when a company invests in cryptocurrencies or chooses to use it in its business?
• How do we think about the decision to self-custody vs. Use a custodian?
• What are the considerations as we select vendors to support key functions like custody?
• Which risk factors should preparers consider disclosing in public filings?
• Which areas of regulation and compliance should companies pay particular attention to?

Review the article on the FEI's website.

The proposed amendments:

• Streamline and clarify certain disclosure requirements in the management’s discussion and analysis (MD&A) and the annual information form (AIF) for non-investment fund reporting issuers.
• Eliminate certain requirements that are redundant or no longer applicable.
• Combine the financial statements, MD&A and, where applicable, AIF into one reporting document called the annual disclosure statement for annual reporting purposes, and the interim disclosure statement for interim reporting purposes.
• Introduce a small number of new requirements to address gaps in disclosure.

The proposed amendments reflect comments received in response to CSA Consultation Paper 51-404 Considerations for Reducing Regulatory Burden for Non-Investment Fund Reporting Issuers. They also reflect research on comparable requirements in other countries and other stakeholder feedback about disclosure requirements in annual and interim filings.

The CSA is also consulting on a proposed framework for semi-annual reporting on a limited basis. The framework would allow venture issuers that are not SEC issuers the choice of reporting on a semi-annual rather than a quarterly basis. Alternative disclosure would be required for interim periods where financial statements and MD&A would not be filed. While no rule is being published for comment at the present time, the CSA is soliciting public comment on whether rules consistent with the proposed framework could further reduce regulatory burden for these issuers while still providing investors with adequate information to make informed decisions.

Review the press release and proposed amendments on the OSC's website.

This was the sixth annual review of disclosure related to women on boards and in executive officer positions conducted by the participating jurisdictions.

The data was compiled from public documents filed on SEDAR and includes the name, industry and year-end of the 610 non-venture issuers who were included in the review sample. These issuers had year-ends between December 31, 2019 and March 31, 2020, and filed information circulars or annual information forms by November 30, 2020.

Review the press release and data on the OSC's website.

The new prospectus exemption outlines that investors who certify to having certain financial and investment knowledge, and acknowledge that they understand certain investment considerations and risks, are permitted to invest alongside accredited investors. To mitigate the risks of investing, self-certified investors are limited, in a calendar year, to investments of $10,000 in any one issuer and $30,000 across multiple businesses. The investment limits won't apply to an investment in an issuer listed on a Canadian stock exchange that is complying with its ongoing reporting obligations, provided that the investor has received suitability advice with respect to the investment. The exemption is being implemented on a three-year pilot basis.

Review the press release and details of the new exemption Multilateral CSA Notice of Implementation Alberta and Saskatchewan Orders 45-538 Self-Certified Investor Prospectus Exemption on the ASC’s website.

The notice provides guidance on securities law requirements applicable to platforms whether trading crypto assets that are securities or derivatives, or contractual rights or claims to underlying crypto assets such as bitcoin or ether. The notice also outlines interim approaches that may be available to CTPs, that are intended to foster innovation and provide flexibility, while ensuring the CTPs operate in an appropriately regulated environment.

In addition, the notice provides an overview of key risks related to CTPs and areas where requirements may be tailored, provided that key risks are addressed and investor protection is not compromised. Finally, the notice outlines the process for submitting an application to the relevant CSA jurisdictions and IIROC.

Review the press release and joint CSA and IIROC Notice 21-329 Guidance for Crypto Asset Trading Platforms: Compliance with Regulatory Requirements.

In Canada, most crypto asset reporting issuers started entering the public markets in 2017 or 2018 through a restructuring transaction with, or a change of business by, an existing reporting issuer. Given this timing, most of these reporting issuers completed their first annual disclosure filings in 2019 for their annual reporting period ending in 2018. The notice describes several staff observations from their review of these initial disclosures.

The notice outlines the disclosure expectations of CSA staff in key areas such as safeguarding crypto assets, the use of crypto asset trading platforms, risk factors, material changes and promotional activities. The notice also provides guidance to crypto asset issuers on navigating certain complex accounting and disclosure issues.

The CSA will continue to evaluate the disclosure of reporting issuers engaged in crypto asset-related activities and will consider the need for further guidance or policy changes specific to these issuers.

Review the press release and guidance.

The notice summarizes results from a review of the disclosure of 610 issuers with year-ends between December 31, 2019 and March 31, 2020. The review focuses on public disclosure regarding women on boards and in executive officer positions, as set out in National Instrument 58-101 Disclosure of Corporate Governance Practices.

Key trends from this year’s review include:

• The total number of board seats occupied by women increased to 20 per cent in 2020, compared to 11 per cent in 2015.
• Seventy-nine per cent of issuers had at least one woman on their board, an increase from 49 per cent in 2015.
• Six per cent of issuers had a female chair of their board.
• Over half of issuers adopted a policy relating to the representation of women on their board, representing a significant increase since 2015.

The CSA intends to publish the underlying data from the review by summer 2021.

Review the press release on the CSA's website and the CSA Multilateral Staff Notice 58-312 Report on Sixth Staff Review of Disclosure Regarding Women on Boards and in Executive Officer Positions on the OSC's website.

CSA members commend the expeditious work completed by the Taskforce which is very useful to bolster our collective reflection on how to advance the Canadian securities regulatory regime. The response outlines the CSA’s perspective on how the Government of Ontario can best achieve the recommendations while also enhancing harmonization, efficiency, responsiveness and investor protection.

Review the press release and response on the CSA's website.

What's New in This Edition

This edition includes updates to reflect rule changes which came into effect in 2017 (principally regarding annual disclosure requirements, including burn rate), expand guidance on the treatment of full value awards and provide FAQs addressing questions commonly received by TSX listings managers.

Key Highlights

1. Disclosure requirements – annually and upon adoption or amendment of a plan
2. Examples of acceptable disclosure and reporting
3. FAQ's

Review the press release and guide on the TSX's website and a summary on Miller Thomson LLP's website.