A recent review of by Canadian Securities Administrators (CSA) has found that reporting issuers have enhanced the quality and amount of disclosure related to the changeover to International Financial Reporting Standards.

Published Friday, Staff Notice 52-326 IFRS Transition Disclosure Review, shows an improvement in the quality of disclosure by reporting issuers on their upcoming transition to IFRS, as provided in their 2009 annual Management’s Discussion & Analysis.

The disclosure of a reporting issuer’s preparation for the transition to IFRS is a key focus for investors when evaluating the readiness of a reporting issuer and the impact that IFRS adoption may have on its business activities and financial reporting. IFRS comes into effect in Canada on Jan. 1, 2011.

“The CSA’s review revealed that reporting issuers have enhanced the quality and amount of disclosure related to the changeover to IFRS, but more improvements should be made,” said Jean St-Gelais, chairman of the CSA and president and CEO of Quebec’s Autorité des marchés financiers. “We expect reporting issuers to continue to provide investors with disclosure that is increasingly robust and complete, as the 2011 transition is quickly approaching.”

The review found, among other things:

– 95% of reporting issuers reviewed disclosed their IFRS changeover plan in their 2009 MD&A;

– 60% of reporting issuers reviewed described milestones and anticipated timelines associated with key elements of their changeover plan; and

– 82% of reporting issuers reviewed identified significant accounting policy differences between the current Canadian GAAP and IFRS. Even so, many reporting issuers could improve their discussion of accounting differences to help investors understand the implications of the IFRS transition that is specific to the issuer.

IE