Cogeco 2013 Annual Report Download - page 77

Download and view the complete annual report

Please find page 77 of the 2013 Cogeco annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 98

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98

76 COGECO CABLE INC. 2013 Consolidated financial statements
The following key assumptions were used to determine the recoverable amounts in the most recent impairment tests performed:
At August 31, 2013 2012
Industry segment Group of CGUs Pre-tax
discount rate
Perpetual
growth
rates Pre-tax discount
rate
Perpetual
growth
rates
% % % %
Canadian cable services Ontario 10.9 2.0 10.6 2.0
Quebec 11.0 2.0 10.4 2.0
American cable services Miami 13.0 3.0 — —
South Carolina 13.0 3.0 — —
Pennsylvania 13.0 3.0 — —
Maryland/Delaware 13.0 3.0 — —
Enterprise services Canada 12.4 3.5 11.0 6.0
United States 12.0 5.3 — —
Europe 11.3 4.5 — —
The following table presents, for each group of CGUs, the change in the discount rate and in the perpetual growth rate used for the tests
performed that would have been required in order for the recoverable amount to equal the carrying value of the CGU at August 31, 2013:
Industry segment Group CGUs Increase in
pre-tax discount rate Decrease in
perpetual growth rates
% %
Canadian cable services Ontario 4.8 4.6
Quebec 1.9 1.7
American cable services Miami 2.1 2.0
South Carolina 1.5 1.4
Pennsylvania 1.6 1.5
Maryland/Delaware 1.2 1.1
Enterprise services Canada 1.1 1.0
United States 1.4 1.0
Europe 0.3 0.4
14. PROVISIONS
During fiscal 2013, provisions variations were as follows:
Year ended August 31, 2013
Withholding
and
stamp taxes Programming
costs Other Total
(In thousands of Canadian dollars) $$$$
Balance at September 1, 2012 6,199 3,168 950 10,317
Acquisition through a business combination — 721 — 721
Provisions made during the year 760 2,120 2,816 5,696
Provisions used during the year — (1,606) — (1,606)
Provisions reversed during the year — (1,945) (700)(2,645)
Foreign currency translation adjustment — 67 — 67
Balance at August 31, 2013 6,959 2,525 3,066 12,550
The provisions for withholding and stamp taxes relate to contingent liabilities for withholding and stamp taxes relating to fiscal years prior to
the acquisition of the Portuguese subsidiary by the Corporation. Pursuant to the completion of the sale of the Portuguese subsidiary (note
21), the Corporation remains responsible for these contingent liabilities up to a maximum amount of €5 million under the terms of the sale
agreement.
The provisions for programming costs include provisions for rate increases as well as additional royalties or content costs as a result of
periodical audits from service providers.
The other provisions include provisions for contractual obligations and other legal obligations.