Shaw 2009 Annual Report Download - page 71

12.0 years). When the restructuring of a benefit plan gives rise to both a curtailment and a
settlement of obligations, the curtailment is accounted for prior to the settlement.
August 31 is the measurement date for the Company’s employee benefit plans. Actuaries perform a
valuation annually to determine the actuarial present value of the accrued pension benefits. The
last actuarial valuation of the pension plan was performed August 31, 2009.
Stock-based compensation
The Company has a stock option plan for directors, officers, employees and consultants to the
Company. The options to purchase shares must be issued at not less than the fair value at the date of
grant. Any consideration paid on the exercise of stock options, together with any contributed surplus
recorded at the date the options vested, is credited to share capital.
The Company calculates the fair value of stock-based compensation awarded to employees using
the Black-Scholes Option Pricing Model. The fair value of options are expensed and credited to
contributed surplus over the vesting period of the options.
Earnings per share
Basic earnings per share is calculated using the weighted average number of Class A Shares and
Class B Non-Voting Shares outstanding during the year. The Company uses the treasury stock
method of calculating diluted earnings per share. This method assumes that any proceeds from the
exercise of stock options and other dilutive instruments would be used to purchase Class B Non-
Voting Shares at the average market price during the period.
Guarantees
The Company discloses information about certain types of guarantees that it has provided,
including certain types of indemnities, without regard to whether it will have to make any payments
under the guarantees (see note 16).
Use of estimates and measurement uncertainty
The preparation of consolidated financial statements in conformity with Canadian GAAP requires
management to make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial
statements and the reported amounts of revenues and expenses during the year. Actual results
could differ from those estimates.
Key areas of estimation, where management has made difficult, complex or subjective judgments,
often as a result of matters that are inherently uncertain, are the allowance for doubtful accounts,
the ability to use income tax loss carryforwards and other future income tax assets, capitalization of
labour and overhead, useful lives of depreciable assets, contingent liabilities, certain assumptions
used in determining defined benefit plan pension expense and the recoverability of deferred costs,
broadcast rights and goodwill using estimated future cash flows. Significant changes in
assumptions could result in impairment of intangible assets.
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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]