September 29, 2006
TSX-Venture Issuers and MI 52-109 Omissions
In our everyday work with Canadian and US filers, we encounter a variety of reactions when companies finally realize the amount of work that is required to accomplish a good quality and accurate Internal Controls over Financial Reporting (ICFR) project. It ranges from acceptance to total denial/anger.
What has become especially disturbing of late is the lack of knowledge and awareness of TSX-V filers surrounding the ICFR requirements for fiscal years ending, in many cases, December 31, 2006. The reactions of many TSX-V filers to the requirements of MI 52-109: "causing internal controls over financial reporting to be designed and implemented" seems to be disbelief and or denial. As if ignoring the requirements and the consequences will make them go away.
As was mentioned earlier this week on our blog, CSA (Canadian Securities Administrators) 52-315 Certification Compliance Review, TSX-V filers are falling way short, on average, of the current disclosure control requirements.
Per the Review:
62% of TSX-V filers did not discuss the effectiveness of their Disclosure Controls and Procedures in their MD&A. The CSA's conclusion is that many "issuers are not paying adequate attention to their disclosure obligations".
This is a "shot off the bow" to issuers to get this right. There may not be too many other warnings.
One can only speculate how many omissions there will be on 52-109 certifications when the majority of issuers with December 31 fiscal year ends begin submitting their 52-109 certifications ,concerning Internal Controls over Financial Reporting.
It is disturbing to see this lack of awareness from companies who have raised funds on the public markets. Public trust is important.
If your small to emerging company is in need of assistance to meet its MI 52-109 or SOX 404 obligations, see www.issuescentral.com to learn more about Compliance Playbook(tm) or if your company is based in Canada, see www.compliancepartner.ca to learn more about Compliance Partner. Now featuring special editions for mining and manufacturing as well as standard editions.
What has become especially disturbing of late is the lack of knowledge and awareness of TSX-V filers surrounding the ICFR requirements for fiscal years ending, in many cases, December 31, 2006. The reactions of many TSX-V filers to the requirements of MI 52-109: "causing internal controls over financial reporting to be designed and implemented" seems to be disbelief and or denial. As if ignoring the requirements and the consequences will make them go away.
As was mentioned earlier this week on our blog, CSA (Canadian Securities Administrators) 52-315 Certification Compliance Review, TSX-V filers are falling way short, on average, of the current disclosure control requirements.
Per the Review:
62% of TSX-V filers did not discuss the effectiveness of their Disclosure Controls and Procedures in their MD&A. The CSA's conclusion is that many "issuers are not paying adequate attention to their disclosure obligations".
This is a "shot off the bow" to issuers to get this right. There may not be too many other warnings.
One can only speculate how many omissions there will be on 52-109 certifications when the majority of issuers with December 31 fiscal year ends begin submitting their 52-109 certifications ,concerning Internal Controls over Financial Reporting.
It is disturbing to see this lack of awareness from companies who have raised funds on the public markets. Public trust is important.
If your small to emerging company is in need of assistance to meet its MI 52-109 or SOX 404 obligations, see www.issuescentral.com to learn more about Compliance Playbook(tm) or if your company is based in Canada, see www.compliancepartner.ca to learn more about Compliance Partner. Now featuring special editions for mining and manufacturing as well as standard editions.
