Rogers 2008 Annual Report Download - page 102

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98 ROGERS COMMUNICATIONS INC. 2008 ANNUAL REPORT
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
5. INVESTMENT IN JOINT VENTURES
2008 2007
Current assets $ 7 $ 7
Long-term assets 68 73
Current liabilities 4 6
Revenue – –
Expenses 29 25
Net income (loss) for the year (29) (25)
The Company has contributed certain assets to joint ventures
involved in the provision of wireless broadband Internet service and
in certain mobile commerce initiatives (note 11(c)). As at December
31, 2008 and 2007 and for the years then ended, proportionately
consolidating these joint ventures resulted in the following increases
(decreases) in the accounts of the Company:
6. INTEGRATION AND RESTRUCTURING EXPENSES
During 2008, the Company incurred $38 million (2007 – nil) of
restructuring expenses related to severances resulting from the
targeted restructuring of its employee base across all segments to
improve its cost structure in light of the declining economic conditions.
Included in accounts payable and accrued liabilities is $35 million as at
December 31, 2008, which will be paid in 2009 and 2010.
During 2008, the Company incurred integration expenses of
$8 million (2007 - $14 million) related to acquisitions.
During 2008, the Company incurred $1 million (2007 - $24 million) of
restructuring expenses related to RBS, which is related to severances
resulting from staff reductions to reflect a reduction in customer
acquisition efforts related to enterprise and larger business
segments. Included in accounts payable and accrued liabilities as
at December 31, 2008, is $2 million (2007 - $12 million) related to the
severances, which will be paid in 2009.
During 2008, the Company incurred $4 million (2007 – nil) related
to the closure of 18 underperforming store locations, primarily
located in the province of Ontario.
In March 2007, the Company contributed its 2.3 GHz and 3.5 GHz
spectrum licences with a carrying value of $11 million to a 50%
owned joint venture for non-cash consideration of $58 million.
Accordingly, the carrying value of spectrum licences was reduced
by $5 million in 2007. A deferred gain of $24 million, being the
portion of the excess of fair value over carrying value related to
the other non-related venturer’s interest in the spectrum licences
contributed by the Company, was recorded on contribution of
these spectrum licences. This deferred gain is recorded in other
long-term liabilities and is being amortized to income over seven
years, of which $4 million was recognized in 2008 (2007 - $2 million).
In addition to a cash contribution of $8 million, the other venturer
also contributed its 2.3 GHz and 3.5 GHz spectrum licences valued
at $50 million to the joint venture. The Company recorded an
increase in spectrum licences and cash of $25 million and $4 million,
respectively, related to its proportionate share of the contribution
by the other venturer.