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2003 Annual Report Rogers Communications Inc.
84
Notes to Consolidated Financial Statements
The Company has committed to the Canadian Radio-television and Telecommunications Commission (“CRTC”) to
spend an aggregate of $77.4 million (2002 – $77.4 million) in operating funds to provide certain benefits to the Canadian
broadcasting system. The Company has agreed to pay $50.0 million in public benefits over the next seven years relating
to the CRTC granting of a new television licence in Toronto, $6.0 million relating to the purchase of 13 radio stations
(note 3(a)) and the remainder relating to a CRTC decision permitting the purchase of Sportsnet, Rogers (Toronto) Ltd. and
Rogers (Alberta) Ltd. The amount of these liabilities, included in accounts payable and accrued liabilities, is $63.5 million
at December 31, 2003 (2002 – $74.0 million) and will be paid over the next six years. Commitments are being amortized
over seven years, beginning in 2002.
In connection with the repayment of certain long-term debt during the year, the Company wrote off deferred
financing costs of $5.5 million (2002 – $3.0 million) (note 10(e)). In 2002, the Company wrote off the carrying value of cer-
tain cross-currency interest rate exchange agreements relating to the repayment of long-term debt of $2.3 million.
8. OTHER ASSETS:
2003 2002
Mortgages and loans receivable, including $894 from officers (2002 – $1,848) $ 6,077 $ 11,133
Inventories 69,318 66,433
Video rental inventory 31,685 33,557
Prepaid expenses 57,812 52,372
Deferred pension asset 17,456 17,098
Acquired program rights 17,729 16,883
Other 11,728 11,507
$ 211,805 $ 208,983
Depreciation expense for video rental inventory is charged to operating expenses and amounted to $60.4 million in 2003
(2002 – $56.5 million). The costs of acquired program rights are amortized to operating expense over the expected perfor-
mances of the related programs and amounted to $20.9 million in 2003 (2002 – $16.9 million).
9. CONSOLIDATED STATEMENTS OF CASH FLOWS:
(a) Change in non-cash operating items:
2003 2002
Increase in accounts receivable $ (38,694) $ (14,447)
Increase (decrease) in accounts payable and accrued liabilities (91,230) 128,336
Increase (decrease) in unearned revenue (12,743) 16,872
Decrease (increase) in deferred charges and other assets 11,846 (4,645)
$ (130,821) $ 126,116
(b) Supplemental cash flow information:
2003 2002
Income taxes paid $ 11,606 $ 15,397
Interest paid 474,044 450,126
(c) Supplemental disclosure of non-cash transactions:
2003 2002
Class B Non-Voting shares issued in consideration for acquisition of shares of Cogeco $ 35,181 $ –
Accretion on Preferred Securities – (37,246)
Accretion on Collateralized Equity Securities – (19,745)
Class B Non-Voting shares issued on conversion of Series B and
Series E Convertible Preferred shares 203 1,800
Class B Non-Voting shares issued in consideration for Class B Restricted Voting shares of Wireless – 104,766
In 2003, the Company issued a total of 2,065,402 Class B Non-Voting shares in connection with the acquisition of Cable
Atlantic Inc. (“Cable Atlantic”) (note 11(a)(iii)(b)).