The Ontario Securities Commission has made a statement that it will look at standardizing the rules for income trusts to report cash distributions.

David Wilson, Chairman of the OSC spoke at the Securities Superconference held in Toronto by the Canadian Institute.  And Susan Wolburgh Jenah, vice shair of the OSC also participated in a panel discussion. Both made comments about income trusts.

The OSC describes income trusts as securities that are created to provide cash flow to consumers.  As the TrustInvestor knows, the OSC is recognizing that income trust managers use different terms to report cash distributions in relation to cash available for distribution, i.e. “distributable cash”. 

At the conference, the OSC representatives talked about creating “consistency” for investors in reporting practices among trusts. The notion of distributable cash has become part of the standard language used among investors, as has “payout ratio”.  So the OSC wants to put rules in place to help define how those numbers are described.

If effective in its efforts, the OSC can help make income trusts more easily and reasonably comparable one to the next for retail investors along with analysts.