Rogers 2009 Annual Report Download - page 84

88 ROGERS COMMUNICATIONS INC. 2009 ANNUAL REPORT
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(TABULAR AMOUNTS IN MILLIONS OF CANADIAN DOLLARS, EXCEPT PER SHARE AMOUNTS)
YEARS ENDED DECEMBER 31, 2009 AND 2008
Rogers Communications Inc. (“RCI”) is a diversified Canadian
communications and media company, with substantially all of its
operations and sales in Canada. RCI is engaged in wireless voice
and data communications services through its Wireless segment
(“Wireless”); cable television, high-speed Internet access, telephony,
data networking and retailing of wireless, cable and video products
and services (“Rogers Retail”) through its Cable segment (“Cable”);
and radio and television broadcasting, televised shopping,
magazines and trade publications, and sports entertainment
through its Media segment (“Media”). RCI and its subsidiary
companies are collectively referred to herein as the “Company”.
In September 2009, RCI announced the further integration of its
Cable and Wireless business with the creation of a Communications
Services organization. Internal management and public reporting
continue to reflect the foregoing Cable and Wireless services as
separate operating segments.
(A) BASIS OF PRESENTATION:
The consolidated financial statements are prepared in accordance
with Canadian generally accepted accounting principles (“GAAP”)
and differ in certain significant respects from accounting principles
generally accepted in the United States of America (“United States
GAAP”) as described in note 25.
The consolidated financial statements include the accounts of
RCI and its subsidiary companies. Intercompany transactions and
balances are eliminated on consolidation.
Investments over which the Company is able to exercise significant
influence are accounted for by the equity method. Investments
over which the Company has joint control are accounted for by the
proportionate consolidation method. Publicly traded investments
where no control or significant influence exists are classified as
available-for-sale investments and are recorded at fair value.
Changes in fair value are recorded in other comprehensive income
until such time as the investments are disposed of or impaired. Other
investments where fair value is not readily available are recorded at
cost. Investments are written down when there is evidence that a
decline in value that is other than temporary has occurred.
Certain of the prior year comparative figures have been re-classified
to conform with the financial statement presentation adopted in
the current year.
(B) REVENUE RECOGNITION:
The Company’s principal sources of revenue and recognition of
these revenues for financial statement purposes are as follows:
(i) Monthly subscriber fees in connection with wireless and wireline
services, cable, telephony, Internet services, rental of equipment,
network services and media subscriptions are recorded as
revenue on a pro rata basis as the service is provided;
(ii) Revenue from airtime, roaming, long-distance and optional
services, pay-per-use services, video rentals and other sales of
products are recorded as revenue as the services or products
are delivered;
(iii) Revenue from the sale of wireless and cable equipment is
recorded when the equipment is delivered and accepted by
the independent dealer or subscriber in the case of direct sales.
Equipment subsidies related to new and existing subscribers
are recorded as a reduction of equipment revenues;
(iv) Installation fees and activation fees charged to subscribers
do not meet the criteria as a separate unit of accounting. As a
result, in Wireless these fees are recorded as part of equipment
revenue and, in Cable, are deferred and amortized over the
related service period. The related service period for Cable
ranges from 26 to 48 months, based on subscriber disconnects,
transfers of service and moves. Incremental direct installation
costs related to reconnects are deferred to the extent of
deferred installation fees and amortized over the same period
as these related installation fees. New connect installation
costs are capitalized to PP&E and amortized over the useful life
of the related assets;
(v) Advertising revenue is recorded in the period the advertising
airs on the Company’s radio or television stations and the
period in which advertising is featured in the Company’s
publications;
(vi) Monthly subscription revenues received by television stations
for subscriptions from cable and satellite providers are
recorded in the month in which they are earned;
(vii) The Toronto Blue Jays Baseball Club’s (“Blue Jays”) revenue from
home game admission and concessions is recognized as the
related games are played during the baseball regular season.
Revenue from radio and television agreements is recorded at
the time the related games are aired. The Blue Jays also receive
revenue from the Major League Baseball Revenue Sharing
Agreement, which distributes funds to and from member clubs,
based on each club’s revenues. This revenue is recognized in the
season in which it is earned, when the amount is estimable and
collectibility is reasonably assured; and
(viii) Discounts provided to customers related to combined purchases
of Wireless, Cable and Media products and services are charged
directly to the revenue for the products and services to which
they relate.
The Company offers certain products and services as part of
multiple deliverable arrangements. The Company divides multiple
deliverable arrangements into separate units of accounting.
Components of multiple deliverable arrangements are separately
accounted for provided the delivered elements have stand-alone
value to the customers and the fair value of any undelivered
elements can be objectively and reliably determined. Consideration
for these units is measured and allocated amongst the accounting
units based upon their fair values and the Company’s relevant
1. NATURE OF THE BUSINESS:
2. SIGNIFICANT ACCOUNTING POLICIES: