On December 15, 2008, National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings (“NI 52-109”) came into force. The purpose of NI 52-109 is to improve the quality and reliability of reporting issuers’ annual and interim disclosure.

Recently, the Canadian Securities Administrators (“CSA”) conducted a review of compliance with the provisions of NI 52-109. Of the total reporting issuers reviewed, only 38% appeared to substantively comply with the requirements of NI 52-109 such that no action was required. Of the remaining 62% of reporting issuers reviewed, some level of non-compliance with the provisions of NI 52-109 was identified. The CSA characterized the level of noncompliance into three categories (refiling of management’s discussion and analysis (“MD&A”) and certificates, refiling of certificates and prospective changes) based upon the nature and severity of the deficiencies identified.

Refiling of MD&A and/or certificates

For 30% of reporting issuers reviewed, the filings were so deficient that the issuers were required to refile their annual MD&A and/or certificates.

The CSA recommended that issuers refile their MD&A and certificates due to the following deficiencies: (i) issuers did not fully disclose their conclusions about the effectiveness of disclosure controls and procedures (“DC&P”) and internal control over financial reporting (“ICFR”) in their MD&A; (ii) issuers qualified their conclusions about the effectiveness of DC&P and/or ICFR with non-permitted qualifications or exceptions; or (iii) issuers limited the scope of design of DC&P or ICFR to exclude controls, policies and procedures of a proportionately consolidated entity, a variable interest entity or a newly acquired business without disclosing in their MD&A the limitation and providing summary financial information about those entities.

The CSA recommended that issuers refile their certificates due to the following deficiencies: (i) issuers made significant amendments to the wording of the form; (ii) issuers incorrectly referred to the existence of a material weakness relating to ICFR when one did not exist or to a limitation in the scope of the design of DC&P and ICFR when no scope limitation was required; (iii) issuers did not refile certificates when they filed amended financial statements or MD&A and did not refile certificates when they filed an annual information form subsequent to filing their financial statements and MD&A; and (iv) nonventure issuers did not include the “Note to reader” in their Form 52-109FV1.

Prospective changes to the certificates and/or the MD&A

Prospective changes were required for 32% of reporting issuers reviewed to correct some aspect of their compliance with NI 52-109 provisions going forward. Prospective changes were required to address: (i) amendments to the wording prescribed by the required form; (ii) incorrect or omitted dates on the required form; (iii) incorrect filing dates of the required form; and (iv) the omission by venture issuers of certain cautionary language.


The CSA will continue to review compliance with NI 52-109 as part of its ongoing compliance reviews and its continuous disclosure review program and will take action when deficiencies are identified.