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On November 13, 2025, the Canadian Securities Administrators (CSA) published a notice and request for comment regarding proposed amendments to National Instrument 52-112 – Non-GAAP and Other Financial Measures Disclosure ("NI 52-112") and consequential amendments to related policies and instruments (the "Proposed Amendments"). The Proposed Amendments respond to the new IFRS® Accounting Standard, IFRS 18 Presentation and Disclosure in Financial Statements ("IFRS 18"), which was issued by the International Accounting Standards Board (IASB) in April 2024 and becomes effective for financial reporting periods commencing on or after January 1, 2027.
The IFRS 18 standard is designed to improve financial reporting and increase comparability of performance measures, including measures not disclosed in an issuer's financial statements in accordance with Generally Accepted Accounting Principles ("GAAP").
The Proposed Amendments are narrow in scope and intended to preserve the current non-GAAP disclosure framework, while aligning it with the requirements of IFRS 18.
The CSA is accepting written comments until February 11, 2026.
Background
The CSA published NI 52-112 in 2021 to address stakeholder demands, including to ensure consistent, transparent and high-quality disclosure of certain financial measures presented outside of financial statements, such as non-GAAP financial measures.
Among other changes, IFRS 18 will introduce new categories and subtotals in the statement of profit or loss, require disclosure of management-defined performance measures ("MPMs") and enhance requirements for grouping information in financial statements.
In particular, IFRS 18 requires issuers to disclose information in the notes to the financial statements about their MPMs. MPMs include any measures that are a subtotal of income and expenses not listed in IFRS Accounting Standards that are used in public communications outside financial statements (such as in a management's discussion & analysis, earnings release, investor presentation, etc.) and communicate management's view of an aspect of the issuer's performance.
NI 52-112 currently defines non-GAAP financial measures as including financial measures that are not disclosed in the financial statements. Without the Proposed Amendments, many measures that have historically been considered non-GAAP financial measures, such as adjusted net income and adjusted EBITDA, would no longer meet the definition, because they would be disclosed in the financial statements as MPMs under IFRS 18. This would create an unintended regulatory gap.
Summary of the Proposed Amendments
The Proposed Amendments seek to close the regulatory gap by ensuring that measures historically subject to NI 52-112 remain subject to it, while avoiding repetitive disclosure. Specifically, the CSA proposes the following amendments:
- Reconciling non-GAAP Defined Terms
The Proposed Amendments expand the definition of "non-GAAP
financial measure" to expressly include MPMs, maintaining the
application of NI 52-112. A new definition for
"management-defined performance measure", aligning the
term with the accounting principles applied to the preparation of
the issuer's financial statements, and a new definition for
"additional subtotal", which is one not defined or listed
in the accounting principles applied to the preparation of the
issuer's financial statements, have also been expressly
included in NI 52-112.
- Incorporating Information by Reference
The Proposed Amendments permit issuers to incorporate certain
required information for MPMs by reference to the notes to the
financial statements, provided the notes already include all
information required under NI 52-112 for such measures, avoiding
repetitive disclosure.
- Additional Subtotal Disclosure
IFRS 18 permits entities to present certain additional subtotals
in the primary financial statements and requires that they be shown
no more prominently than IFRS-defined totals and subtotals. To
align with this approach, the Proposed Amendments extend existing
prominence rules when these additional subtotals are disclosed
outside the financial statements. This requires issuers to: (i)
also present the most directly comparable financial measure from
the primary financial statements that is not an MPM; and (ii)
ensure the additional subtotal is not given greater
prominence.
- Exemptions
The Proposed Amendments include an exemption for certain federal
financial institutions which are currently exempt from NI 52-112
under existing blanket orders and under Rule 52-503 in Ontario.
British Columbia's existing blanket order relating to federal
financial institutions (BCI 52-513) will continue to apply,
ensuring uniformity in the application of the exemption across
Canada.
- Related Amendments
The CSA has proposed related changes to Companion Policy 52-112 – Non-GAAP and Other Financial Measures Disclosure to provide guidance on the interpretation and application of the Proposed Amendments. In addition, the CSA has proposed consequential amendments to Multilateral Instrument 11-102 – Passport System to allow any applications pertaining to NI 52-112 to be made under the passport system.
Looking Forward
The Proposed Amendments are formulated to minimize disruption to existing disclosure practices, reduce duplicative disclosures and allow for more efficient allocation of issuer compliance resources. If adopted, the CSA anticipates that issuers will incur only minimal implementation costs as a result of the Proposed Amendments, while enhancing investor protection and avoiding misleading financial reporting.
The CSA notes that the IASB is exploring whether to require disclosure in the notes to the financial statements of other financial measures beyond MPMs, such as free cash flow. The CSA will continue to monitor developments in this area and will assess whether future amendments to NI 52-112 are required.
For questions regarding the Proposed Amendments and how they may affect your disclosures, please contact any member of our Capital Markets Group.
The authors would like to thankChloe Bechard, Articling Student-At-Law, for her assistance in writing this Update.
The content of this article does not constitute legal advice and should not be relied on in that way. Specific advice should be sought about your specific circumstances.
