Shaw 2010 Annual Report Download - page 121

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transaction would have been recorded at the fair value of the shares in HomeStar Services Inc.
This would have resulted in a gain on disposition of the consideration the Company exchanged
for its investment in Star Choice and an increase in the acquisition cost for Star Choice.
(6) Gain on sale of cable systems
The gain on sale of cable systems determined under Canadian GAAP has been adjusted to
reflect the lower net book value of broadcast rights under US GAAP as a result of item
(1) adjustments.
Under Canadian GAAP, no gain was recorded in 1995 on an exchange of cable systems with
Rogers Communications Inc. on the basis that this was an exchange of similar productive
assets. Under US GAAP the gain net of applicable taxes is recorded and amortization adjusted
as a result of the increase in broadcast rights upon the recognition of the gain.
(7) Fair value of derivatives
Certain derivatives that qualify for cash flow hedge accounting under Canadian GAAP do not
qualify for similar treatment for US GAAP.
(8) Subscriber connection fee revenue
Subscriber connection fee revenue is 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
Under US GAAP, 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).
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 2010,
amounted to $66,138 (2009 – $52,384; 2008 – $47,656).
117
Shaw Communications Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
August 31, 2010, 2009 and 2008
[all amounts in thousands of Canadian dollars except share and per share amounts]