Most investors in the United States are familiar with the U.S. Securities & Exchange Commission's ("SEC") EDGAR database for use in retrieving SEC filings, which is extremely useful for finding everything from annual reports (10-K filings) to insider transactions (Form 4 filings). In Canada, there is a similar filing system for Canadian companies known as SEDAR.
SEDAR is an acronym for System for Electric Document Analysis and Retrieval and functions very similarly to the U.S. SEC's EDGAR database. Canadian companies must use SEDAR to file documents, such as financial statements and prospectuses, in Adobe Acrobat PDF format. The goal is to increase transparency by making the information publicly available and easy to access.
SEDAR is run by the Canadian Securities Administrators ("CSA") and operated by CDS Inc. since 1997. While CSA has started a voluntary XBRL implementation, the regulators have not yet required public companies to make these updated filings, as in the United States. XRBL is designed to make it easier to share and analyze financial information.
In this article, we will take a look at how international investors can access SEDAR and identify important filings to assist in their due diligence for Canadian companies.
- Canada's SEDAR is similar to the U.S. SEC's EDGAR solution; it's designed to make financial markets more transparent by requiring companies to file financial statements and other information for investors to see.
- Investors can access SEDAR filings online where they can be searched, saved, shared, and printed.
- Investors should pay close attention to annual reports, financial statements, MD&A, prospectuses, and NI 43-101 reports.
How to Access SEDAR
SEDAR can be accessed in either English or French at the organization's homepage. Once the desired section is chosen, investors can search records by clicking on the "Search Database" link under the SEDAR logo and selecting the desired option to search either "company" or "investment fund" records.
The company records search page provides many different options. Investors can search for specific companies, look into industry groups, search by filing date, or look for only certain documents. It's important to note that these document names differ greatly from their counterparts in the United States (SEC filings), but many of the same categorizations exist.
Once the desired filing is found, investors must click to view the filing and agree to the terms and conditions before the Adobe Acrobat PDF file is opened. And finally, once opened, the file can be saved, searched, printed or shared using Adobe Acrobat's built-in tools, if using the Adobe Acrobat Reader or other supported PDF readers.
The process is a little less streamlined than the United States' EDGAR system, but it's still a functional way to find and read important company filings. Unfortunately, there are no third-party services that offer access to SEDAR filings given the way that they must be accessed and the lack of an API.
Important SEDAR Filings
There are several filings that investors should look for when using SEDAR, which are similar to their counterparts in the United States. Knowing the most important filings to watch, investors can sort through the clutter and identify the most important pieces of information to complete due diligence and identify potential investment opportunities.
Here are some important filings to watch:
- Annual Report - Annual reports summarize a company's progress and financial condition over the course of a year while providing new potential investors with a great overview of a company and its operations.
- Financial Statements - Financial statements provide key insights into a company's growth via their income statement and cash flow statement, as well as financial health via their balance sheet.
- Management's Discussion & Analysis - Management's Discussion & Analysis reports are often filed alongside financial statements and contain an in-depth discussion of the financial results and related information.
- Prospectus - A prospectus provides information about companies looking to raise capital or undergo an initial public offering (IPO), including both business descriptions and financial statements.
- NI 43-101 Reports - NI 43-101 reports are highly regarded reports in Canada's resource sectors, which account for a significant portion of the country's economy.
In addition to these filings, investors can find a multitude of additional filings covering any number of different circumstances. Canadian investors should familiarize themselves with all of these filing types in order to better research and understand potential investments and existing holdings.