Shaw 2014 Annual Report Download - page 25

Shaw Communications Inc.
MANAGEMENT’S DISCUSSION AND ANALYSIS
August 31, 2014
level. Neither the holding company nor the licensee may be controlled in fact by non-
Canadians, the determination of which is a question of fact within the jurisdiction of the CRTC.
The same restrictions apply to certain Canadian carriers pursuant to the Telecommunications
Act and associated regulations and the Radiocommunication Act and associated regulations,
except that there is no requirement that the CEO be a resident Canadian. In March 2012, the
government announced its intention to amend the Telecommunications Act to remove Canadian
ownership requirements for wire-line and wireless telecommunications carriers with annual
revenues from the provision of telecommunications services in Canada that represent less than
10% of the total annual revenues, as determined by the CRTC. These amendments were passed
as part of the federal budget bill in June 2012 and may lead to greater levels of competition in
the Canadian telecommunications market.
The Corporation’s Articles contain measures to ensure the Corporation is able to remain
compliant with applicable Canadian ownership requirements and its ability to obtain, amend or
renew a license to carry on any business. Shaw must file a compliance report annually with the
CRTC confirming that it is eligible to operate in Canada as a telecommunications common
carrier.
AWS spectrum transfers
On June 28, 2013 the Minister of Industry announced a new framework for the review of
spectrum license transfers. Under the new framework, all spectrum transfer reviews, including
the review of the proposed transfer of Shaw’s AWS spectrum to Rogers, will include
consideration of a number of factors, including the overall distribution of license holdings in the
licensed spectrum band and other commercial mobile spectrum bands in the licensed area, the
relative utility and substitutability of the licensed spectrum and the change in spectrum
concentration levels that would result from the transfer. The reviews by Industry Canada and the
Competition Bureau of the proposed transfer of Shaw’s AWS spectrum to Rogers are ongoing.
E. Key performance drivers
Shaw measures the success of its strategies using a number of key performance drivers which
are outlined below, including a discussion as to their relevance, definitions, calculation
methods and underlying assumptions.
FINANCIAL MEASURES:
i) Revenue
Revenue is a measurement determined in accordance with International Financial Reporting
Standards (“IFRS”). It represents the inflow of cash, receivables or other consideration arising
from the sale of products and services. Revenue is net of items such as trade or volume
discounts, agency commissions and certain excise and sales taxes. It is the base on which free
cash flow, a key performance driver, is determined; therefore, it measures the potential to
deliver free cash flow as well as indicating growth in a competitive market place.
The Company’s continuous disclosure documents may provide discussion and analysis of non-
IFRS financial measures. These financial measures do not have standard definitions prescribed
by IFRS and therefore may not be comparable to similar measures disclosed by other
companies. The Company’s continuous disclosure requirements may also provide discussion
and analysis of additional GAAP measures. Additional GAAP measures include line items,
headings and sub-totals included in financial statements. The Company utilizes these measures
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