Companion Policy to NI 52-112 Non-GAAP and Other Financial Measures Disclosure
Incorporation by reference
Re s. 5

Lexata note: This companion policy is not yet effectve. See Part 5 of NI 52-112 for transition details.

Incorporation by reference

The Instrument allows an issuer to incorporate by reference certain disclosure, if the reference is to the issuer’s MD&A. To meet the requirement that the MD&A be available on SEDAR under paragraph 5(2)(c) of the Instrument, the MD&A must be filed on SEDAR before, or simultaneously with the document, in order for this MD&A to be used to incorporate any information by reference into the document. For example, if an issuer is filing an annual information form that includes a specified financial measure and the issuer is incorporating certain information in the MD&A by reference to satisfy the disclosure requirements of the Instrument, that MD&A would have to be filed on SEDAR before or simultaneously with the filing of the annual information form.

Paragraph 5(2)(b) requires the identification of the specific location of the required information in the MD&A. To comply with this requirement, identify where the required information is specifically located within the MD&A (e.g., identify the specific MD&A including a reference to the date of the MD&A, its reporting period, and the specific section or page reference within the MD&A) or provide a hyperlink to the specific section or page within the MD&A where the information is located. Issuers would not satisfy this requirement with a general hyperlink to the relevant MD&A.

The Instrument allows an issuer to incorporate by reference certain required disclosure in a news release; however, subsection 5(1) does not apply to the quantitative reconciliation requirements under clauses 6(1)(e)(ii)(C), paragraph 7(2)(d) or 9(c), or clause 10(1)(b)(ii)(C) if the document that contains the specified financial measure is an earnings release filed by the issuer under section 11.4 of NI 51-102.



Companion Policy to NI 52-112 Non-GAAP and Other Financial Measures Disclosure
Proximity, composition and usefulness
Re ss. 6(1)(e), 7(2)(d), 8(c), 9(c), 10(1)(b), 11(b)

Lexata note: This companion policy is not yet effectve. See Part 5 of NI 52-112 for transition details.

Proximity to the first instance

To prevent duplicative disclosure, an issuer may include the information required by paragraphs 6(1)(e), 7(2)(d), 8(c), 9(c), 10(1)(b), 11(b) of the Instrument in one section of the document, unless incorporation by reference is permitted under section 5 of the Instrument. To satisfy these requirements, when the specified financial measure first appears in the document an issuer may reference, either through a footnote or in another manner, a separate section within the same document that contains the disclosure required by these paragraphs.

There may be types of documents where it is not clear when the specified financial measure first occurs or appears, for example, websites and social media. In these instances, the “first instance” disclosure requirements may be satisfied by providing a website hyperlink to where the disclosures required by paragraphs 6(1)(e), 7(2)(d), 8(c), 9(c), 10(1)(b), 11(b) of the Instrument are found (e.g., on another section of the website) with minimal to no scrolling or navigation. Hyperlinking may only be provided within a website or within a document.



Application and exceptions
Companion Policy to NI 52-112 Non-GAAP and Other Financial Measures Disclosure
Re s. 2

Lexata note: This companion policy is not yet effectve. See Part 5 of NI 52-112 for transition details.

Application to reporting issuers

Websites and Social Media

The Instrument applies to a reporting issuer in respect of its disclosure, on a website and social media, of a specified financial measure.

A reporting issuer should not disclose a specified financial measure using social media, if it is unable to include or incorporate by reference all the required disclosure.



National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure
Part 3 Specified Financial Measure Disclosure
Section 8

Lexata note: This national instrument is not yet effective. See Part 5 for transition details.

Non-GAAP ratios

An issuer must not disclose a non-GAAP ratio in a document unless all of the following apply:

(a) the non-GAAP ratio is labelled using a term that, given the non-GAAP ratio’s composition, describes the non-GAAP ratio;

(b) the non-GAAP ratio is presented with no more prominence in the document than that of similar financial measures disclosed in the primary financial statements of the entity to which the non-GAAP ratio relates;

(c) in proximity to the first instance of the non-GAAP ratio in the document, the document

(i) explains that the non-GAAP ratio is not a standardized financial measure under the financial reporting framework used to prepare the financial statements of the entity to which the non-GAAP ratio relates and might not be comparable to similar financial measures disclosedby other issuers,

(ii) discloses each non-GAAP financial measure that is used as a component of the non-GAAP ratio,

(iii) discloses, directly or by incorporating it by reference as permitted under section 5, an explanation of

(A) the composition of the non-GAAP ratio,

(B) how the non-GAAP ratio provides useful information to an investor and explains the additional purposes, if any, for which management uses the non-GAAP ratio, and

(C) if the label or the composition of the non-GAAP ratio has changed from what was previously disclosed, an explanation of the reason for the change;

(d) if the non-GAAP ratio is disclosed in MD&A or in an earnings release of the issuer, the non-GAAP ratio for a comparative period, determined using the same means of calculation, is disclosed in the document, unless

(i) the non-GAAP ratio is forward-looking information, or

(ii) it is impracticable to disclose the measure for the comparative period.



National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure
Part 3 Specified Financial Measure Disclosure
Section 6

Lexata note: This national instrument is not yet effective. See Part 5 for transition details.

Non-GAAP financial measures that are historical information

(1) An issuer must not disclose a non-GAAP financial measure that is historical information in a document unless all of the following apply:

(a) the non-GAAP financial measure is labelled using a term that,

(i) given the measure’s composition, describes the measure, and

(ii) distinguishes the measure from totals, subtotals and line items disclosed in the primary financial statements of the entity to which the measure relates;

(b) the non-GAAP financial measure is identified as a non-GAAP financial measure;

(c) the document discloses the most directly comparable financial measure that is disclosed in the primary financial statements of the entity to which the measure relates;

(d) the non-GAAP financial measure is presented with no more prominence in the document than that of the most directly comparable financial measure referred to in paragraph (c);

(e) in proximity to the first instance of the non-GAAP financial measure in the document, the document

(i) explains that the non-GAAP financial measure is not a standardized financial measure under the financial reporting framework used to prepare the financial statements of the entity to which the measure relates and might not be comparable to similar financial measures disclosed by other issuers,

(ii) discloses, directly or by incorporating it by reference as permitted under section 5,

(A) an explanation of the composition of the non-GAAP financial measure,

(B) an explanation of how the non-GAAP financial measure provides useful information to an investor and explains the additional purposes, if any, for which management uses the non-GAAP financial measure,

(C) a quantitative reconciliation of the non-GAAP financial measure for its current and comparative period, if disclosed under paragraph (f), to the most directly comparable financial measure referred to in paragraph (c), and that reconciliation is disclosed in the permitted format, and

(D) if the label or composition of the non-GAAP financial measure has changed from what was previously disclosed, an explanation of the reason for the change;

(f) if the non-GAAP financial measure is disclosed in MD&A or in an earnings release of the issuer, the non-GAAP financial measure for a comparative period, determined using the same composition, is disclosed in the document, unless it is impracticable to do so.

(2) For the purpose of clause (1)(e)(ii)(C), a quantitative reconciliation of the non-GAAP financial measure is in the “permitted format” if it

(a) is disaggregated quantitatively in a way that would enable a reasonable personapplying a reasonable effort to understand the reconciling items,

(b) explains each reconciling item, and

(c) does not describe a reconciling item as “non-recurring”, “infrequent”, “unusual”, or using a similar term, if a loss or gain of a similar nature is reasonably likely to occur within the entity’s 2 financial years that immediately follow the disclosure, or has occurred during the entity’s 2 financial years that immediately precede the disclosure.



National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure
Part 2 Incorporating information by reference
Section 5

Lexata note: This national instrument is not yet effective. See Part 5 for transition details.

Incorporating information by reference

(1) Subject to subsections (3) and (4), an issuer may incorporate by reference the information required under any of the following provisions, if the reference is to the issuer’s MD&A:

(a) subparagraph 6(1)(e)(ii);

(b) paragraph 7(2)(d);

(c) subparagraph 8(c)(iii);

(d) paragraph 9(c);

(e) subparagraph 10(1)(b)(ii);

(f) paragraph 11(b).

(2) If, as permitted under subsection (1), an issuer incorporates required information by reference into a document, the issuer must include all of the following in the document:

(a) a statement indicating that the information is incorporated by reference;

(b) a statement that specifies the location of the information in the MD&A;

(c) a statement that the MD&A is available on SEDAR at www.sedar.com.

(3) Despite subsection (1), an issuer must not incorporate by reference the information referred to in subsection (1) in its MD&A if the document that contains the specified financial measure is another MD&A filed by the issuer.

(4) Despite subsection (1), an issuer must not incorporate by reference the information referred to in clause 6(1)(e)(ii)(C), paragraph 7(2)(d) or 9(c) or clause 10(1)(b)(ii)(C) if the document that contains the specified financial measure is in an earnings release filed by the issuer.