Glossary
ESTMA Reporting
ESTMA reporting is the annual public disclosure of payments an oil, gas, or mineral company makes to governments, required under Canada’s Extractive Sector Transparency Measures Act (ESTMA). It exists so that citizens can see what extractive companies pay to the governments that regulate them, and it applies to many of the mining and energy issuers we serve. At Treewalk, we prepare and file these reports as part of the public-company reporting function we run for extractive-sector clients.
What it actually is
ESTMA is federal legislation administered by Natural Resources Canada. It targets a specific problem: extractive companies move large sums to governments through royalties, taxes, and fees, and those flows used to be invisible. The Act makes the material ones public.
A reporting entity must disclose, for each financial year, payments made to any single government (federal, provincial, municipal, foreign, and Indigenous governing bodies in Canada) that reach the reporting threshold in aggregate. Payments are grouped into set categories, including:
- Taxes
- Royalties
- Fees
- Production entitlements
- Bonuses
- Dividends
- Infrastructure improvement payments
The report is a structured document filed with Natural Resources Canada and then posted publicly. It is not a financial statement and it is not audited in the way an annual audit is. It is a factual schedule of who got paid, how much, and under which category.
Who has to file
Two broad tests bring a company into scope. The first is being listed on a stock exchange in Canada and engaged in the commercial development of oil, gas, or minerals. The second applies to companies that have a place of business, do business, or hold assets in Canada and meet a size test based on assets, revenue, and employee count across a reporting year.
For our clients, the listing test is usually the one that bites. A junior miner on the TSX Venture Exchange with early-stage properties can still be an ESTMA reporter even before it earns meaningful revenue, because the trigger is the listing plus the activity, not profitability. That surprises a lot of first-time public issuers.
How we approach it at Treewalk
We treat ESTMA as part of the same reporting calendar as the financial statements, the MD&A (Management Discussion and Analysis), and the continuous-disclosure filings. Bolting it on at the last minute is how deadlines get missed.
Our process starts in the general ledger. Because we run bookkeeping and controllership for many of our extractive clients, we already see the payment flows during the year. We tag government payments as they land, map them to the ESTMA categories, and reconcile against the trial balance so the report ties to the books. Then we prepare the report in the required format and coordinate the filing.
We have done this in practice. On the Hi Ho Silver Resources (TSX-V: HHS) mandate, a silver issuer, we handled the annual financial statements and regulatory filings alongside ESTMA reporting, and we coordinated the press-release response when late-filing pressure hit the disclosure timeline. That combination, the accounting and the filing traffic control, is the point.
The hard part of ESTMA is rarely the arithmetic. It is deciding what counts as one payee and which payments belong in which category. A payment to a provincial mining ministry and a payment to that province’s tax authority can both be “the province” or two separate payees depending on how the government is organized. Get the payee definition wrong and the whole schedule is wrong.
Common misconceptions
The most common one we hear: “We are pre-revenue, so ESTMA does not apply to us.” Revenue is not the trigger. A listed exploration company that pays mineral claim fees, permit fees, and property taxes to governments can cross the threshold on fees alone.
The second: “This is the same as our financial statements.” It is not. ESTMA measures cash and in-kind payments to governments, not accrual accounting results. A payment can appear on an ESTMA report in a year where it never touches the income statement.
The third: “The auditors handle it.” Treewalk does not provide audit or attest services, and ESTMA reporting is a management responsibility regardless of who audits the company. It sits with the finance function, which is where we operate.
What you get
When we run ESTMA reporting for a client, the deliverable is a filed report that reconciles to the books, a supporting workpaper showing how each payment was categorized and which payee it was assigned to, and a filing confirmation. Because we manage this inside the broader reporting cycle, the same team that prepares your IFRS statements and coordinates your SEDAR+ filing support prepares the ESTMA report. Nothing falls between two vendors.
Frequently asked questions
Is ESTMA reporting the same as filing on SEDAR+?
No. ESTMA reports are filed with Natural Resources Canada and posted publicly, separate from the continuous-disclosure documents a public issuer files on SEDAR+. Many of our clients do both, and we manage them together so the calendars line up.
Do we need to file if we are a pre-revenue explorer?
Possibly yes. ESTMA is triggered by being a listed extractive company (or meeting a size test) and making reportable payments to governments, not by earning revenue. Fees, permit costs, and property taxes paid to governments can put an exploration-stage issuer in scope. We assess this before assuming you are exempt.
What payments actually have to be disclosed?
Payments to governments that reach the aggregate reporting threshold for the year, sorted into set categories such as taxes, royalties, fees, production entitlements, bonuses, dividends, and infrastructure improvement payments. Payments to Indigenous governing bodies in Canada are also reportable. We map your ledger to these categories.
How is this different from what a large audit firm would do?
A Big-Four-style firm typically audits your statements at arm’s length. We sit inside the finance function as your outsourced reporting team, so we see the government payments as they happen and build the ESTMA report from the same ledger we already maintain. Treewalk does not provide audit services, so there is no independence conflict.
Where to next
If you are a listed miner or energy issuer trying to work out whether ESTMA applies and who will actually prepare the report, our public company reporting team is the right starting point. It pairs naturally with IFRS financial statement preparation for extractive issuers. You can reach Avnit Sekhon through our contact page. For the source rules, Natural Resources Canada publishes the ESTMA guidance directly.
