Cogeco 2012 Annual Report Download - page 83

82 COGECO CABLE INC. 2012 Consolidated financial statements
26. TRANSITION TO IFRS
As mentioned in note 1, these are the first consolidated financial statements prepared in accordance with IFRS.
The significant accounting policies set out in note 2 have been applied in preparing the consolidated financial statements for the year
ended August 31, 2012, the comparative information presented in the year ended August 31, 2011 and in the preparation of the opening
IFRS Statement of financial position at September 1, 2010 (the Corporation’s transition date).
IFRS 1 ELECTIVE EXEMPTIONS AND MANDATORY EXCEPTIONS
IFRS 1 permits certain elective exemptions from full retrospective application of IFRS at the transition date. The Corporation elected the
following exemptions in preparing its opening IFRS Statement of financial position:
 Business combinations
A first-time adopter may elect not to apply IFRS 3, Business combinations, retrospectively to business acquisitions completed before
the transition date. The retrospective basis would require restatement of all business combinations that occurred prior to the transition
date. The Corporation has elected not to retrospectively apply IFRS 3 to business combinations completed prior to its transition date
and such business combinations have not been restated. Any assets or liabilities arising on business combinations completed before
the transition date have not been adjusted from the carrying value previously determined under Canadian GAAP as a result of
applying this exemption.
 Employee benefits
The Corporation has elected to recognize all cumulative actuarial gains and losses that existed at its transition date in opening
retained earnings for all of its employee defined benefit pension plans. The Corporation also elected to prospectively disclose
required defined benefit pension plans amounts under IAS 19 Employee Benefits as the amounts are determined for each accounting
period from the date of transition instead of the current annual period and previous four annual periods.
 Share-based payments
The Corporation has elected to apply the requirements of IFRS 2, Share-based payments, only to equity instruments granted after
November 7, 2002 and which vested after the date of transition to IFRS.
 Borrowing costs
The Corporation has elected to apply the requirements of IAS 23 Borrowing Costs only to borrowing costs relating to assets for which
the commencement date for capitalization was on or after the date of transition. Borrowing costs incurred before the date of transition
were expensed.
 Financial assets and financial liabilities
At the date of transition, the Corporation has elected to reclassify cash and cash equivalents from held-for-trading to loans and
receivables.
 Leases
At the date of transition, the Corporation has elected to apply the transitional provisions in IFRIC 4, Determining Whether an
Arrangement Contains a Lease, thereby determining whether the Corporation has any arrangements that exist at the date of
transition to IFRS that contain a lease on the basis of facts and circumstances existing at that date. Also, the Corporation has elected
to apply an additional exemption by which an entity that has assessed arrangements which may contain leases under previous GAAP
is permitted to maintain this assessment and not re-assess these arrangements under IFRIC 4.
The Corporation applied the following mandatory exceptions in preparing its opening IFRS financial statements:
 Hedge accounting
Hedge accounting can only be applied prospectively from the transition date to transactions that satisfy the hedge accounting criteria
in IAS 39 at that date. Hedging relationships cannot be designated retrospectively and the supporting documentation cannot be
created retrospectively. As a result, only hedging relationships that satisfied the hedge accounting criteria as of its transition date are
reflected as hedges in the Corporation’s results under IFRS.
 Estimates
Hindsight is not used to create or revise estimates. The estimates previously made by the Corporation under Canadian GAAP were
not revised for application of IFRS except where necessary to reflect any difference in accounting policies.
The Corporation has adjusted amounts reported previously in financial statements prepared in accordance with previous Canadian GAAP.
An explanation of how transition from previous Canadian GAAP to IFRS has affected the Corporation’s financial position and financial
performance is set out in the following tables and the notes that accompany the tables.