Shaw 2009 Annual Report Download - page 105

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(7) Derivative instruments and hedging activities
Under US GAAP, all derivatives are recognized in the Consolidated Balance Sheet at fair
value. Derivatives that are not hedges are adjusted to fair value through income. Derivatives
that are hedges are adjusted through income or other comprehensive income until the hedged
item is recognized in income depending on the nature of the hedge.
Until September 1, 2007 under Canadian GAAP, only speculative derivative financial
instruments and those that did not qualify for hedge accounting were recognized in the
Consolidated Balance Sheet.
(8) Subscriber connection fee revenue and related costs
Subscriber connection fee revenue and related costs are deferred and amortized under
Canadian GAAP. Under US GAAP, connection revenues are recognized immediately to the
extent of related costs, with any excess deferred and amortized.
(9) Pension liability
Effective August 31, 2007, the Company adopted FASB Statement No. 158 “Employers’
Accounting for Defined Benefit Pension and Other Postretirement Benefit Plans”. Under
Statement No. 158, the Company is required to recognize the funded status of the non-
contributory defined benefit pension plan on the Consolidated Balance Sheet and to
recognize changes in the funded status in other comprehensive income (loss).
Prior to the adoption of Statement No. 158, an additional minimum liability was recorded for
the difference between the accumulated benefit obligation and the accrued pension liability.
The additional liability was offset in deferred charges up to an amount not exceeding the
unamortized past service costs and the remaining difference was recognized in other
comprehensive income, net of tax.
Under Canadian GAAP, the over or under funded status of defined benefit plans is not
recognized on the Consolidated Balance Sheet.
(10) Interest costs
Under US GAAP, interest costs are capitalized as part of the historical cost of acquiring
certain qualifying assets which require a period of time to prepare for their intended use.
Interest capitalization is not required under Canadian GAAP.
(11) Income taxes
Income taxes reflect various items including the tax effect of the differences identified above,
the impact of future income tax rate reductions on those differences and an adjustment for
the tax benefit related to capital losses that cannot be recognized for US GAAP.
(b) Advertising costs
Advertising costs are expensed when incurred for both Canadian and US GAAP and for 2009,
amounted to $52,384 (2008 – $47,656; 2007 – $43,210).
101
Shaw Communications Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
August 31, 2009, 2008 and 2007
[all amounts in thousands of Canadian dollars except share and per share amounts]