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Placer Dome Inc. - MRRS Decision
Headnote
Mutual Reliance Review System for ExemptiveRelief Applications -- securities of issuer registered undersection 12 of the 1934 Act -- issuer not required to registerunder United States Investment Company Act of 1940 -- reliefgranted from requirement to file annual and interim financialstatements prepared in accordance with Canadian GAAP and auditedin accordance with Canadian GAAS -- relief granted from requirementto include in a short form prospectus annual and interim financialstatements prepared in accordance with Canadian GAAP and auditedin accordance with Canadian GAAS -- relief conditional uponissuer preparing annual and interim financial statements inaccordance with US GAAP and audited in accordance with US GAAS-- issuer to provide Canadian GAAP reconciliation for two yearsfollowing date of decision.
Statutes Cited
Securities Act, R.S.O. 1990, c. S.5, as am.,ss. 77, 78, 80(b)(iii).
Regulations Cited
R.R.O. 1990, Reg. 1015, as am., s. 2.
Instruments Cited
National Instrument 44-101 Short Form Distributions(2000) 23 O.S.C.B. (supp.) 867.
IN THE MATTER OF
THE SECURITIES LEGISLATIONOF
ALBERTA, BRITISH COLUMBIA,MANITOBA,
NEWFOUNDLAND AND LABRADOR,NORTHWEST TERRITORIES,
NOVA SCOTIA, NUNAVUT, PRINCEEDWARD ISLAND,
ONTARIO, QUÉBEC, SASKATCHEWANAND YUKON
AND
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEWSYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
AND
IN THE MATTER OF
PLACER DOME INC.
MRRS DECISION DOCUMENT
1. WHEREAS the local securities regulatoryauthority or regulator (the "Decision Maker") ineach of Alberta, British Columbia, Manitoba, Newfoundlandand Labrador, Northwest Territories, Nova Scotia, Nunavut,Prince Edward Island, Ontario, Québec, Saskatchewanand Yukon (the "Jurisdictions") has received anapplication from Placer Dome Inc. (the "Applicant")for a decision under the securities legislation of the Jurisdictions(the "Legislation") that the requirements (the "CanadianGAAP and GAAS Requirements") contained in the Legislationto file annual and interim financial statements, includingany financial statements of the Applicant included in anyshort form prospectus filed by the Applicant under NationalInstrument 44-101 Short Form Prospectus Distributions("NI 44-101"), prepared in accordance with CanadianGAAP and, in the case of the annual financial statements,audited in accordance with Canadian GAAS, will not apply tothe Applicant;
2. AND WHEREAS under the Mutual RelianceReview System for Exemptive Relief Applications (the "System"),the British Columbia Securities Commission is the principalregulator for this application;
3. AND WHEREAS, unless otherwise defined,the terms herein have the meaning set out in National Instrument14-101 Definitions or in Québec Commission Notice 14-101;
4. AND WHEREAS the Applicant has representedto the Decision Makers that:
1. the head office of the Applicant is inVancouver, British Columbia;
2. directly and through its subsidiaries,the Applicant is principally engaged in the explorationfor, and the acquisition, development and operation of,gold mineral properties;
3. the Applicant is a reporting issuer,or holds similar status, under the laws of each provinceand territory of Canada, and has held such status for over12 months;
4. the Applicant's authorized capital consistsof an unlimited number of common shares (the "CommonShares") and an unlimited number of preferred shares,issuable in series (the "Preferred Shares");
5. as of April 30, 2003, the Applicant had408,838,021 outstanding Common Shares and no outstandingPreferred Shares;
6. the Common Shares are listed for tradingon the Toronto Stock Exchange, the New York Stock Exchange,the Australian Stock Exchange, Euronext-Paris and the SwissExchange;
7. the Applicant is currently qualifiedto file a short form prospectus under NI 44-101;
8. the Common Shares are registered undersection 12(b) of the 1934 Act and the Applicant is not registeredor required to register as an investment company under theUnited States Investment Company Act of 1940;
9. the Applicant has, since at least 1999,produced and filed with each of the Jurisdictions on theSystem for Electronic Document Analysis and Retrieval ("SEDAR"):
(a) annual financial statements preparedin accordance with Canadian GAAP and audited in accordancewith Canadian GAAS,
(b) interim financial statements preparedin accordance with Canadian GAAP,
(c) annual financial statements preparedin accordance with generally accepted accounting principlesin the United States of America that the SEC has identifiedas having substantial authoritative support, as supplementedby Regulation S-X under the 1934 Act ("US GAAP")and audited in accordance with Canadian GAAS includinga reconciliation note to Canadian GAAP, and
(d) interim financial statements preparedin accordance with US GAAP, including a reconciliationnote to Canadian GAAP;
10. the Applicant proposes to file interimand annual financial statements prepared in accordance withUS GAAP and, in the case of annual statements, audited inaccordance with generally accepted auditing standards inthe United States of America, as supplemented by the SEC'srules on auditor independence ("US GAAS"), tosatisfy its continuous disclosure requirements with respectto financial statements in each of the Jurisdictions;
11. the Applicant is satisfied that it hasobtained and applied the necessary level of expertise inUS GAAP to support the preparation of US GAAP financialstatements and has in fact been preparing such statementssince the first quarter of 1999, prior to which its CanadianGAAP financial statements included a note providing a reconciliationto US GAAP;
12. the Applicant's audit committee hastaken steps to ensure it has, or has access to, the necessaryexpertise in relation to US GAAP and that management hasput in place systems to ensure that the appropriate levelsand numbers of staff have and will maintain the level ofexpertise in US GAAP necessary to prepare reliable, highquality financial statements;
13. the Applicant's audit committee hassatisfied itself as to the adequacy of the expertise ofthe audit engagement team and the audit firm in relationto the application of US GAAP and US GAAS; and
14. to the best of its knowledge, the Applicantis not in default of any requirements of the Legislation;
5. AND WHEREAS under the System, thisMRRS Decision Document evidences the decision of each DecisionMaker (collectively, the "Decision");
6. AND WHEREAS each of the DecisionMakers is satisfied that the test contained in the Legislationthat provides the Decision Maker with the jurisdiction tomake the Decision has been met;
7. THE DECISION of the Decision Makersunder the Legislation is that the Canadian GAAP and GAAS Requirementswill not apply to the Applicant provided that:
(a) the Applicant's Common Shares are registeredunder section 12(b) of the 1934 Act and the Applicant isnot registered or required to register as an investmentcompany under the United States Investment Company Actof 1940;
(b) the Applicant's annual and interim financialstatements required to be filed under the Legislation areprepared in accordance with US GAAP and, in the case ofannual financial statements, audited in accordance withUS GAAS;
(c) the notes to the first two sets of annualcomparative financial statements filed after the date ofthis Decision and the notes to the interim financial statementsfor interim periods during those two years:
(i) explain the material differences betweenCanadian GAAP and US GAAP that relate to recognition,measurement and presentation,
(ii) quantify the effect of material differencesbetween Canadian GAAP and US GAAP that relate to recognition,measurement and presentation, including a tabular reconciliationbetween net income reported in the financial statementsand net income computed in accordance with Canadian GAAP,and
(iii) provide disclosure consistent withCanadian GAAP requirements to the extent not already reflectedin the financial statements;
(d) the notes to the financial statementsidentify the accounting principles used to prepare the financialstatements;
(e) the Applicant files a supplement tothe Management Discussion and Analysis ("MD&A")relating to each of the financial statements referred toin paragraph (c) above that will restate, based on financialinformation of the Applicant prepared in accordance withor reconciled to Canadian GAAP, those parts of the MD&Athat:
(i) are based on financial statementsof the Applicant prepared in accordance with US GAAP,and
(ii) would contain material differencesif they were based on financial statements of the Applicantprepared in accordance with Canadian GAAP;
(f) the Applicant uses US GAAP generallyon a going-forward basis for all of its financial statementsfiled under its continuous disclosure requirements in theJurisdictions;
(g) the Applicant files an auditor's reporton the financial statements filed under paragraph (c) abovethat is prepared in accordance with US GAAS and that:
(i) contains an unqualified opinion,
(ii) identifies all financial periodspresented for which the auditor has issued an auditor'sreport; if the Applicant has changed its auditor and oneor more of the comparative periods presented in the financialstatements were audited by a different auditor, the auditor'sreport must refer to any former auditor's report(s) onthe comparative periods, and
(iii) identifies the auditing standardsused to conduct the audit and the accounting principlesused to prepare the financial statements; and
(h) this Decision, as it relates to thejurisdiction of a Decision Maker, will terminate upon publicationin final form of any legislation or rule of that DecisionMaker dealing with acceptable accounting principles andauditing standards, except proposed National Instrument52-107 Acceptable Accounting Principles, Auditing Standardsand Reporting Currency in substantially the same formas published on May 16, 2003, that conflicts with any provisionof this Decision.
July 24, 2003.
"Brenda Leong"