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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
96 ROGERS COMMUNICATIONS INC. 2010 ANNUAL REPORT
During 2010, the Company released $5 million of its valuation allowance
that primarily relates to a decrease of foreign future income tax assets
due to foreign exchange fluctuations.
In March 2010, the federal budget introduced proposed changes that
impact the tax deductibility of cash-settled stock options. The proposed
legislative changes were enacted in December 2010. As a result, the
Company recorded an income tax charge of $35 million to reduce future
tax assets previously recognized with respect to its stock option-related
liabilities.
During 2009, the Company released $64 million of its valuation
allowance as an income tax recovery in the consolidated statements of
income. Of this amount, $14 million relates to a decrease of future tax
assets in foreign jurisdictions arising from foreign exchange fluctuations
and the remaining $50 million relates to unrealized gains on investments
and financial instruments.
As at December 31, 2010, the Company had approximately $188 million
of Canadian income tax losses available to reduce future years’ income.
Substantially all Canadian losses expire after 2025. In addition, the
Company had approximately $62 million of income tax losses in foreign
subsidiaries expiring between 2023 and 2029.
At December 31, 2010, the Company had approximately $238 million of
available capital losses to offset future capital gains.
The following table sets forth the calculation of basic and diluted net
income per share:
8. NET INCOME PER SHARE:
9. OTHER CURRENT ASSETS:
2010 2009
Numerator:
Net income for the year, basic and diluted $ 1,528 $ 1,478
Denominator (in millions):
Weighted average number of shares outstanding – basic and diluted 576 621
Basic and diluted net income per share $ 2.65 $ 2.38
2010 2009
Inventories $ 185 $ 129
Prepaid expenses 114 110
Acquired program rights 49 61
Rogers Retail rental inventory 14 27
Other 311
$ 365 $ 338
Amortization expense for Rogers Retail rental inventory is charged to
cost of sales and amounted to $54 million in 2010 (2009 – $43 million).
The costs of acquired program rights are amortized to operating,
general and administrative expenses over the expected performances
of the related programs and amounted to $167 million in 2010 (2009 –
$131 million). Cost of sales includes $1,466 million (2009 – $1,337 million)
of inventory costs.