Rogers 2009 Annual Report Download - page 85

ROGERS COMMUNICATIONS INC. 2009 ANNUAL REPORT 89
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
revenue recognition policies are applied to them. The Company
recognizes revenue once persuasive evidence of an arrangement
exists, delivery has occurred or services have been rendered, fees
are fixed and determinable and collectibility is reasonably assured.
Unearned revenue includes subscriber deposits, cable installation
fees and amounts received from subscribers related to services and
subscriptions to be provided in future periods.
(C) SUBSCRIBER ACQUISITION AND RETENTION COSTS:
Except as described in note 2(b)(iv), as it relates to cable installation
costs, the Company expenses the costs related to the acquisition or
retention of subscribers.
(D) STOCK-BASED COMPENSATION AND OTHER STOCK-BASED
PAYMENTS:
The Company’s employee stock option plans, which are described in
note 19(a), attach cash settled share appreciation rights (“SARs”) to
all granted stock options. The SARs feature allows the option holder
to elect to receive in cash an amount equal to the intrinsic value,
being the excess market price of the Class B Non-Voting share over
the exercise price of the option, instead of exercising the option and
acquiring Class B Non-Voting shares. All outstanding stock options
are classified as liabilities and are carried at their intrinsic value,
as adjusted for vesting, measured as the difference between the
current stock price and the option exercise price. The intrinsic value
of the liability is marked-to-market each period and is amortized to
income over the period in which the related services are rendered,
which is usually the graded vesting period, or, as applicable, over
the period to the date an employee is eligible to retire, whichever
is shorter.
The Company has a restricted share unit (“RSU”) plan, which is
described in note 19(b). RSUs that will be settled in cash are recorded
as liabilities. The measurement of the liability and compensation
costs for these awards is based on the intrinsic value of the award
and is recorded as a charge to income over the vesting period of the
award. Changes in the Company’s liability subsequent to the grant
of the award and prior to the settlement date, due to changes in
the market value of the underlying Class B Non-Voting shares, are
recorded as a charge to income in the period incurred. The payment
amount is established as of the vesting date of the award.
The Company has a deferred share units (“DSU”) plan, which is
described in note 19(c). DSUs that will be settled in cash are recorded
as liabilities. The measurement of the liability and compensation
costs for these awards is based on the intrinsic value of the award at
the date of grant. Changes in the Company’s liability subsequent to
grant of the award and prior to the settlement date, due to changes
in the market value of the underlying Class B Non-Voting shares, are
recorded as a charge to income in the period incurred. The payment
amount is established as of the vesting date of the award.
The employee share accumulation plan allows employees to
voluntarily participate in a share purchase plan. Under the terms
of the plan, employees of the Company can contribute a specified
percentage of their regular earnings through payroll deductions
and the Company makes certain defined contribution matches,
which are recorded as compensation expense in the period made.
(E) DEPRECIATION:
PP&E are depreciated over their estimated useful lives as follows:
(F) INCOME TAXES:
Future income tax assets and liabilities are recognized for the future
income tax consequences attributable to temporary differences
between the financial statement carrying amounts of existing assets
and liabilities and their respective tax bases. Future income tax
assets and liabilities are measured using enacted or substantively
enacted tax rates expected to apply to taxable income in the years
in which those temporary differences are expected to be recovered
or settled. A valuation allowance is recorded against any future
income tax asset if it is not more likely than not that the asset will
be realized.
(G) FOREIGN CURRENCY TRANSLATION:
Monetary assets and liabilities denominated in a foreign currency
are translated into Canadian dollars at the exchange rate in effect
at the balance sheet dates and non-monetary assets and liabilities
and related depreciation and amortization expenses are translated
at the historical exchange rate. Revenue and expenses, other than
depreciation and amortization, are translated at the average rate
for the month in which the transaction was recorded. Exchange
gains or losses on translating long-term debt are recognized in the
consolidated statements of income and consolidated statements of
comprehensive income, as applicable. Foreign exchange gains or
losses are primarily related to the translation of long-term debt.
Asset Basis Rate
Buildings Mainly diminishing balance 5% to 6²⁄ ³%
Towers, head-ends and transmitters Straight line 6²⁄³% to 25%
Distribution cable and subscriber drops Straight line 5% to 20%
Network equipment Straight line 6²⁄³% to 33¹⁄ ³%
Wireless network radio base station equipment Straight line 12½% to 14¹⁄ ³%
Computer equipment and software Straight line 14¹⁄ ³% to 33¹⁄ ³%
Customer equipment Straight line 20% to 33¹⁄ ³%
Leasehold improvements Straight line Over shorter of
estimated useful life
and lease term
Equipment and vehicles Mainly diminishing balance 5% to 33¹⁄ ³%