News Release

Released: March 16, 2001

Toronto -- Canadian securities regulators want to find out if Canadian and foreign issuers should be allowed to file financial statements according to U.S. Generally Accepted Accounting Principles (GAAP) or International Accounting Standards rather than Canadian GAAP.

The Canadian Securities Administrators has posted a discussion paper on the Ontario and BC websites and is seeking public comment on the pros and cons of changing the rules governing financial statements.

“We want to determine if the current rules requiring foreign issuers to reconcile their financial statements to Canadian GAAP deter companies from public offerings in Canada,” said Doug Hyndman, CSA chair.

“A growing number of large Canadian companies listed in the U.S. now prepare a complete set of both Canadian and U.S. statements," added John Carchrae, Chief Accountant for the Ontario Securities Commission. “These companies tells us this is a costly exercise and that the Canadian GAAP statements not provide clear benefits to Canadian investors.”

However, the potential changes present some issues that must be addressed. For example, allowing the use of more than one set of accounting standards will make it more difficult for Canadian investors to compare results for different companies.

The Canadian accounting profession would face the challenge of gaining the necessary level of expertise with US GAAP and the new IAS. As well, there are some statutory requirements for Canadian companies that require the continued preparation of Canadian GAAP information.

Hyndman stressed the CSA wants to hear from the public and investment industry before any changes are made that could significantly affect the information available to investors.

To assist in fully assessing the issues, the CSA is seeking responses to 17 detailed questions set out in a discussion paper available on the Ontario Securities Commission website (www.osc.gov.on.ca) and the BC Securities Commission website (www.bcsc.bc.ca).

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