An issuer is not required to engage its auditor to review its interim financial report for the purposes of fulfilling its continuous disclosure obligations under NI 51-102. As depicted in the chart below however, subsection 4.3(3) of NI 51-102 requires a reporting issuer to disclose if an auditor has not performed a review of the interim financial report, to disclose if an auditor was unable to complete a review and why, and to file a written report from the auditor if the auditor has performed a review and expressed a reservation in the auditor’s interim review report.
As the white box in the chart shows, the only time that disclosure is not required is when an auditor has performed a review and has not expressed a reservation in the auditor’s interim review report. The term “review” refers to a review engagement where the auditor reports to the issuer’s audit committee on the results of a review of the issuer’s interim financial report for all of the periods presented in the report and in accordance with Section 7050 of the Handbook. (If a reporting issuer’s financial statements are audited in accordance with auditing standards other than Canadian generally accepted auditing standards, the corresponding review standards should be applied.) Where an auditor has been retained to perform limited review procedures or to review only certain components of an issuer’s interim financial report, this would not constitute a “review” and we would require disclosure of a notice indicating that the interim financial report has not been reviewed by the auditor. While NI 51-102 does not prescribe the format of this notice, issuers typically provide this disclosure on a separate page appearing immediately before the interim financial report.