On July 15, 2011, the Canadian Securities Administrators released the results of their continuous disclosure review program activities for the fiscal year ended March 31, 2011. The CSA summarized the results of their targeted reviews and provided guidance regarding common deficiencies.


The CSA is monitoring compliance with the material contract filing requirements set out in National Instrument 51-102 Continuous Disclosure Obligations. In 2008, these requirements were updated to, among other things, limit the exemption from filing a material contract that was entered into in the ordinary course of business to exclude contracts that are important to the understanding of the issuer’s business and to limit an issuer’s ability to redact sensitive information. 16% of issuers reviewed were required to file missing material contracts, while 3% of issuers were required to revise redacted provisions.


The CSA regularly conducts reviews of mining technical disclosure and reiterated a number of concerns identified in prior years, including issuers failing to:  

  • include the name of the qualified person in documents containing scientific and technical disclosure;  
  • include the required disclosure for historical estimates;  
  • include required certificates or consents for qualified persons; and  
  • comply with the requirements of National Instrument 43-101 Standards of Disclosure for Mineral Properties in corporate presentations and website content.  


The CSA assessed issuers’ compliance with corporate governance disclosure requirements and interim and annual filing certification requirements. 55% of issuers selected for review were required to enhance their corporate governance disclosure for the following year. 22% of issuers were required to re-file their MD&A and/or certificates.


The CSA highlighted a number of common deficiencies identified in their review and provided detailed examples of deficient and appropriate disclosure.  

MD&A Deficiencies – Common MD&A deficiencies included:  

  • the use of non-GAAP financial measures;  
  • forward-looking information requirements;  
  • the requirement to include a meaningful discussion of operations;  
  • fluctuations and trends in liquidity;  
  • discussion of fourth quarter items or events; and  
  • venture issuers’ discussion of exploration costs.  

Financial Statement Deficiencies – Common financial statement deficiencies included the note disclosure provided for inventory and related party transactions.

Executive Compensation Disclosure Deficiencies – The CSA found that many issuers continue to provide insufficient disclosure regarding the performance goals used in evaluating executive compensation, as well as the benchmark group used for specific levels of compensation.  


The CSA indicated that the main focus of the 2012 continuous disclosure review program will be on IFRS transition.

For a full discussion of the issues discussed above see CSA Staff Notice 51-334 Continuous Disclosure Review Program Activities for the fiscal year ended March 31, 2011, available here.