National Policy 51-201 Disclosure Standards
Part V Risks Associated With Certain Disclosures
Section 5.2

Analyst Reports

(1) It is not unusual for analysts to ask corporate officers to review earnings estimates that they are preparing. A company takes on a high degree of risk of violating securities legislation if it selectively confirms that an analyst’s estimate is “on target” or that an analyst’s estimate is “too high” or “too low”, whether directly or indirectly through implied “guidance”. [FN 34]

(2) Even when confirming information previously made public, a company needs to consider whether the selective confirmation itself communicates information above and beyond the initial forecast and whether the additional information is material. This will depend in large part on how much time has passed between the original statement and the company’s confirmation, as well as the timing of the two statements relative to the end of the company’s fiscal period. For example, a selective confirmation of expected earnings near the end of a quarter is likely to represent guidance (as it may well be based on how the company actually performed). Materiality of a confirmation may also depend on intervening events. [FN 35]

(3) One way companies can try to ensure that analyst’s estimates are in line with their own expectations is through the regular and timely public dissemination of qualitative and quantitative information. The better the marketplace is informed, the less likely it is that analysts’ estimates will deviate significantly from a company’s own expectations.

FN 34 This position follows the position adopted by the SEC in the adopting release to Regulation FD and the position taken by the Australian Securities & Investments Commission in its guidance note “Better Disclosure for Investors” (

FN 35 The guidance with respect to the materiality of confirming information previously made public is based on SEC Staff interpretive guidance on Regulation FD.