Shaw 2010 Annual Report Download - page 83

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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, spectrum licenses and goodwill using estimated future cash flows. Significant
changes in assumptions could result in impairment of intangible assets.
Adoption of recent Canadian accounting pronouncements
(i) Goodwill and intangible assets
Effective September 1, 2009, the Company adopted CICA Handbook Section 3064, “Goodwill and
Intangible Assets”, which replaces Sections 3062, “Goodwill and Other Intangible Assets”, and
3450, “Research and Development Costs”. Section 3064 establishes standards for the
recognition, measurement, presentation and disclosure of goodwill and intangible assets. As a
result, connection costs that had been previously deferred and amortized, no longer meet the
recognition criteria for intangible assets. In addition, the new standard requires computer software,
that is not an integral part of the related hardware, to be classified as an intangible asset.
The provisions of Section 3064 were adopted retrospectively with restatement of prior periods. The
impact on the Consolidated Balance Sheets as at August 31, 2010 and August 31, 2009 and on the
Consolidated Statements of Income and Retained Earnings (Deficit) for the year ended August 31,
2010, 2009 and 2008 is as follows:
August 31, 2010
$
August 31, 2009
$
Increase (decrease)
Consolidated balance sheets:
Property, plant and equipment (156,469) (105,180)
Deferred charges (4,266) (3,383)
Intangibles 156,469 105,180
Future income taxes (1,077) (863)
Retained earnings (3,189) (2,520)
Decrease in retained earnings:
Adjustment for change in accounting policy (2,520) (3,756)
Increase (decrease) in net income (669) 1,236
(3,189) (2,520)
79
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]