Canadian Securities Administrators Request For Comment On Proposed Amendments To NI 52‑112 - Non‑GAAP And Other Financial Measures Disclosure

The Canadian Securities Administrators (CSA) have published for a 90‑day comment period proposed amendments to NI 52‑112 and related changes to the Companion Policy, plus a consequential amendment to Multilateral Instrument 11‑102 - Passport System. The primary objective is to address the implications of IFRS 18 - Presentation and Disclosure in Financial Statements so that management‑defined performance measures disclosed in financial statements do not fall outside the scope of NI 52‑112 when those same measures are used outside the financial statements.

Why this is being proposed

IFRS 18 introduces "management‑defined performance measures" (MPMs) to be disclosed in a note to the financial statements when certain criteria are met. Historically, these measures (e.g., adjusted net income, adjusted EBITDA) have been treated as non‑GAAP financial measures when disclosed outside the financial statements and therefore subject to NI 52‑112.

Without amendment, once MPMs appear in the financial statements, they could cease to meet NI 52‑112's current definition of a non‑GAAP financial measure, potentially removing them from NI 52‑112 oversight when used outside the financial statements.

The proposal seeks to maintain the regulatory status quo for these measures outside the financial statements, minimize disruption and reduce duplicative disclosures.

Key proposals

Revise definitions

• Amend the definition of "non‑GAAP financial measure" to explicitly include management‑defined performance measures.
• Add definitions for "additional subtotal" and for "management‑defined performance measure."

Incorporation by reference

• Permit, in specified circumstances, incorporation by reference from the notes to the financial statements for required information about MPMs to avoid duplication, provided the financial statements are available on SEDAR+ and the specific location is clearly identified.
• Earnings releases cannot incorporate the quantitative reconciliation by reference; those reconciliations must be presented in the release.

Additional subtotal disclosures outside the financial statements

When an additional subtotal (a subtotal presented in the primary financial statements but not defined/listed in IFRS Accounting Standards) is disclosed outside the financial statements, it must:

• Be presented with no greater prominence than the most directly comparable measure from the primary financial statements that is not an MPM; and
• Be accompanied by that most directly comparable measure.

Exemptions for certain issuers

The proposed change will codify existing relief for certain financial institutions (previously provided via blanket orders and Ontario Rule 52‑503), with British Columbia continuing to rely on its existing blanket order. Related blanket orders and Ontario Rule 52‑503 would be rescinded on adoption.

Consequential change to MI 11‑102

The proposal will also add NI 52‑112 to Appendix D of the Passport System so applications relating to NI 52‑112 can be made under the passport framework.

Companion Policy guidance updates

• Clarify use of accounting terms aligned with IFRS Accounting Standards.
• Provide guidance on anti‑avoidance (i.e., not placing measures in the notes merely to avoid NI 52‑112).
• Explain presentation expectations, including acceptable "two‑step" reconciliations and consistent labelling inside and outside the financial statements.
• Extend existing guidance to cover websites and social media disclosures for both specified financial measures and additional subtotals.

Who is affected

• Reporting issuers that disclose non‑GAAP financial measures or other specified financial measures outside the financial statements.
• Financial institutions benefitting from codified exemptions under specified conditions.
• Investors, who will retain consistent, comparable information for non‑GAAP measures used outside the financial statements.

Practical implications for issuers

There will be limited change in practice. The amendments are designed to preserve the current regulatory treatment of commonly used adjusted measures outside the financial statements after IFRS 18. Issuers should:

• Align their non‑GAAP control frameworks with the inclusion of MPMs under NI 52‑112 when used outside the financial statements.
• If using incorporation by reference, ensure clear pinpoint references to the relevant note(s) and that the financial statements are filed before or at the same time as the referencing document.
• For additional subtotals disclosed outside the financial statements, verify prominence and include the most directly comparable IFRS measure that is not an MPM.
• Maintain consistent labels for measures inside and outside the financial statements.
• For earnings releases, include the quantitative reconciliation within the release.

Cost-benefit considerations

The CSA expect no material ongoing compliance costs from the amendments themselves.

Implementation effort will mainly involve understanding the changes and performing a gap analysis. Benefits include regulatory certainty, reduced duplicative disclosure through incorporation by reference and continued investor protection and comparability.

Comment period and submissions

The deadline for submissions is February 11, 2026. Submissions should be addressed to all CSA jurisdictions. Comments cannot be kept confidential and will be posted publicly. Commenters must identify clearly on whose behalf submissions are made. The amendments will come into force on a date to be specified following the comment process and requisite approvals.