Last week, the Canadian Securities Administrators (CSA) issued a Staff Notice in response to questions they have received regarding disclosure about accounting policies in issuers' interim and annual MD&A. While the CSA previously issued a staff notice addressing disclosure for periods preceding the changeover to IFRS, the current notice considers issues relating to the year of changeover.
Specifically, the notice considers Item 1.13(b) of Form 51-102F1 Management's Discussion & Analysis regarding the initial adoption of new accounting policies. The notice clarifies that while Item 1.13(b) of 51-102F1 does not apply to accounting policies initially adopted as a result of a changeover to IFRS, Item 1.13(b) applies to an issuer voluntarily changing accounting policies subsequent to filing the first interim financial report (other than due to the early adoption of a new or revised IFRS standard). Further, management may want to provide information regarding significant entity-specific features of the issuer's transition to IFRS.
The notice also states issuers should consider discussing "significant differences" between MD&A disclosure made prior to changeover to IFRS and information disclosed in the current period regarding accounting policy choices. According to the notice, issuers should also consider disclosing information pertaining to IFRS transition in one section of the MD&A and separately from the discussion of financial performance and financial condition.
For more information, see CSA Staff Notice 52-328.