(left to right: David Frost, Partner; Thomas Fung, Associate; Liam Peet-Pare, Articling Student; McCarthy Tétrault, LLP)
The Canadian Securities Administrators (CSA) have proposed targeted amendments to NI 52‑112 Non-GAAP and Other Financial Measures Disclosure (NI 51-112) to preserve Canada’s non‑GAAP disclosure framework as IFRS 18 introduces audited management‑defined performance measures (MPMs) in financial statements starting in 2027. Here is what changes, what stays the same, and how issuers should prepare through 2026.
Why this matters now
On November 13, 2025, the CSA published a Notice and Request for Comment proposing amendments to NI 52‑112 and changes to related instruments and policies in light of the International Financial Reporting Standard 18 Presentation and Disclosure in Financial Statements (IFRS 18). The objective is straightforward: as IFRS 18 brings MPMs into the audited financial statements, the CSA wants to ensure those same measures remain subject to Canada’s existing expectations when they are used outside the financial statements – such as in earnings releases, investor presentations and management discussions and analyses (MD&A). Without this alignment, familiar measures like adjusted EBITDA or adjusted net income could inadvertently fall outside NI 52‑112’s scope when used in external communications. The proposal is intentionally narrow‑scope and aims to minimize disruption while preserving consistency and comparability for investors.
The IFRS 18 backdrop
IFRS 18 was issued by the International Accounting Standards Board (IASB) on April 9, 2024 to replace IAS 1. It is effective for annual periods beginning on or after January 1, 2027, with earlier application permitted. For the purposes of IFRS 18, MPMs are subtotals of income and expenses that are not specified by IFRS accounting standards and are used by an issuer in public communications outside of financial statements (including, for example, in MD&A, press releases and investor presentations) to communicate management’s view of the issuer’s financial performance. Historically, MPMs have been treated as non-GAAP financial measures subject to NI 52-112 when disclosed outside of an issuer’s financial statement. However, under IFRS 18, an issuer must disclose MPMs and certain related information in a dedicated note to the issuer’s financial statements. The presentation of MPMs in an issuer’s financial statements in compliance with IFRS 18 would result in such financial measures no longer considered as non-GAAP financial measures under NI 52-112. The transition is retrospective, so 2026 will generally serve as the comparative period that must be presented under the new structure.
What the CSA has proposed under NI 52‑112
Preserve scope and oversight: The CSA proposes amendments to ensure that measures disclosed as MPMs under IFRS 18 remain within NI 52‑112’s framework when used outside the financial statements.
Prominence safeguards for additional subtotals: When issuers disclose an additional subtotal (i.e. not one required by IFRS) outside the financial statements, NI 51-112 would require appropriate context and prohibit giving it greater prominence than IFRS‑required subtotals, in line with IFRS 18’s rules on presentation.
Incorporation by reference: To avoid duplication, the proposed amendments would allow for certain information, such as detailed reconciliations, to be incorporated by reference from the MPM note in the financial statements, subject to conditions.
Consolidated relief: The proposal would introduce an exemption for certain financial institutions with regards to disclosure of certain financial measures that are required under guidelines or advisory guidance of the Office of the Superintendent of Financial Institutions (OSFI) or the Autorité des marchés financiers. This is a codification to exemptions that currently exist in blanket orders and Ontario Rule 52‑503 Exemption from Disclosure of a Specified Financial Measure. British Columbia’s existing blanket order (BC Instrument 52‑513 Exemption from National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure) would continue to apply separately.
Continuity over change: The CSA emphasizes a narrow‑scope response that aims to minimize changes to current practices for specified financial measures used outside the financial statements while ensuring alignment with IFRS 18.
Timeline and the 2026 lookback
Although IFRS 18 first applies to reporting periods beginning in 2027, the requirements are retrospective. That means issuers will need to present 2026 comparatives under the new structure and provide MPM disclosures in the notes to the 2027 financial statements that speak to measures used throughout 2026. For issuers, this means it is imperative to start planning now. Communications in 2026 should anticipate IFRS 18’s definitions, labels and subtotals so that the 2027 annual package reads consistently across the financial statements, MD&A, earnings materials and investor decks.
What this means for Issuers: A 2026 action plan
1) Map and classify your measures.
Build a single inventory of all performance measures used in public communications. Identify which will be MPMs (captured in the financial statements), which remain non‑GAAP outside the financial statements, and which are other specified measures under NI 52‑112 (e.g. non‑GAAP ratios, capital management measures, supplementary financial measures).
2) Harmonize labels, definitions and messaging.
Tighten alignment between earnings releases, MD&A and investor presentations, and the audited MPM note. Standardize labels and definitions (retire duplicative metrics) so that descriptions of purpose and usefulness are consistent and credible across all channels.
3) Design reconciliations and cross‑references.
Decide what reconciliations to include in‑document versus by reference to the financial statement note (where permitted). Keep navigation intuitive and ensure SEDAR+ filings and your IR website make cross‑referencing seamless.
4) Ensure prominence and placement is compliant.
Review your templates and page layouts to ensure additional subtotals used outside the financial statements do not overshadow IFRS‑required subtotals. Use side‑by‑side presentation, clear labelling, and concise explanations of purpose and usefulness to maintain context.
5) Update controls and training.
Refresh disclosure controls and procedures (DC&P) and align Finance, IR, Legal and external auditors on terminology (MPMs vs. non‑GAAP vs. additional subtotals) and the retrospective nature of the transition. Document ownership for each measure and ensure calculation methodologies are updated and understood in light of the new IFRS 18 requirements.
Looking ahead
The comment period for proposed amendments to NI 52‑112 ended on February 11, 2026 and the final text and Companion Policy guidance are expected sometime this year. The amendments are designed to minimize disruption to existing disclosure practices and reduce duplicative disclosures.
The IASB is currently considering imposing requirements for certain disclosures in the notes to the financial statements regarding other financial measures beyond MPMs that have also historically been considered non-GAAP financial measures, such as free cash flow. The CSA continues to monitor these developments and will assess whether future amendments to NI 51-112 will be required beyond the current proposed amendments.
David Frost is a Partner at McCarthy Tétrault LLP. This article was written by: Thomas Fung, Associate; and Liam Peet-Pare, Articling Student; McCarthy-Tétrault LLP.