The Canadian securities law rule that requires certification of public company annual and interim filings has been amended to give CEOs and CFOs extra time to certify their company’s internal control over financial reporting.
CEOs and CFOs will now have until the first financial year ending on or after June 30, 2006 to certify that
they are responsible for establishing and maintaining the internal controls;
they have designed the internal controls to provide reasonable assurance that financial reporting is reliable and that the external financial statements are prepared in accordance with GAAP; and
the company has disclosed in its annual or interim MD&A all changes in the internal controls that materially affect or are reasonably likely to materially affect the internal controls.
The postponement will give CEOs and CFOs additional time to satisfy themselves that they have appropriate foundations for making these certifications. The new implementation date also dovetails with the proposed date on which the largest public companies must comply with the proposed Canadian internal control rule that would require management to report on, and the auditor to attest to, the effectiveness of internal control over financial reporting.
Companies must replace the existing "bare" form of certification with a "modified" form of annual certification for financial years ending between March 31, 2005 and June 29, 2006, inclusive. For interim periods in financial years beginning between April 1, 2005 and June 30, 2006, inclusive, interim certifications must be filed in the modified form (reproduced in Appendix B). The modified forms include certifications about disclosure controls and procedures. A cross-border public company will, in most cases, be permitted to file the form of certification filed under section 302 of the Sarbanes-Oxley Act of 2002 in lieu of the Canadian form of certification.
A copy of the amendments to Multilateral Instrument 52-109, Certification of Disclosure in Issuers’ Annual and Interim Filings, can be obtained on the Ontario Securities Commission’s website at
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