In December, the Alberta Securities Commission (ASC) published its annual Corporate Finance Disclosure Report (Report). The ASC then hosted an information seminar (Seminar) on the Report’s findings and recommendations in Calgary, Alberta on January 11, 2017. Fasken Martineau was pleased to attend the Seminar with a view to advising our reporting issuer clients as to best disclosure practices.

The ASC chose to focus on commodity price impacts on continuous disclosure by reporting issuers, as opposed to the more typical practice of a broader-scope report. As such, the Report gave topical and important reviews, in that context, on the use of non-GAAP measures (NGMs) and forward-looking information, as well as impairment of assets under accounting standards. Most prominent among the continuous disclosure issues in the Report, however, was liquidity and capital resources information in management discussion and analysis disclosure.

We expect the ASC will be paying particular attention to fulsome and timely disclosure of liquidity and capital resources information in 2017, particularly in respect of plans to remedy working capital deficiencies, conditional borrowing limits, risk of breach of financial covenants, and impacts on production capacity maintenance following capital expenditure reductions and asset dispositions.

While the Report did provide a review of NGM disclosure requirements, NGMs were featured more prominently at the Seminar, with the ASC providing additional and nuanced guidance on their use. As such, we also expect the ASC to pay close attention to the use of NGMs in public disclosure going forward.

The Report also provided, among other things, a review of proper material contract disclosure, prospectus disclosure of use of proceeds, and the emerging issue of cybersecurity disclosure following the Canadian Securities Administrators’ (CSA) publication of CSA Staff Notice 11-332 Cyber Security. The Report suggests reporting issuers that identify cybersecurity as a material risk should also develop cyberattack remediation plans that include attack materiality assessment and public disclosure guidelines.

While the Seminar largely focussed on the contents of the Report, the ASC did share additional and helpful insights applicable to reporting issuers. Attendees were reminded of recently effective amendments to National Instrument 62-104 Take-Over Bids and Issuer Bids, announced by the CSA in February 2016, as well as the CSA’s guidance on Climate Change Risk Disclosure set out in CSA Staff Notice 51-333 Environmental Reporting Guidance. The ASC also noted the potential for reporting issuers’ social media posts to result in prohibited selective disclosure.

The proposed adoption by Alberta, Manitoba and New Brunswick of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (MI 61-101) was also discussed at the Seminar. While MI 61-101 already applies to many Alberta reporting issuers by way of listings on the Toronto Stock Exchange, TSX Venture Exchange and other exchanges, its proposed adoption by the ASC would broaden the scope of applicable transactions in Alberta to include, among others, going-private transactions by de-listed reporting issuers, as well as certain issuer and insider bids in respect of non-reporting issuers.