Tucows 2012 Annual Report Download - page 89

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F-13
(s) Segment reporting
The Company operates in one business segment.
The Company’s revenues are attributed to the country in which the contract originates, primarily Canada.
Revenues from domain names issued from the Toronto, Canada location are attributed to Canada because it is
impracticable to determine the country of the customer.
The Company’s assets are located in Canada, the United States, Germany and the Netherlands.
(t) Reclassifications
Beginning in the first quarter of 2012, Tucows reclassified its revenue streams into three distinct service
offerings: Wholesale, Retail and Portfolio. The realignment is intended to better reflect the manner in which these
revenue streams are generated and assessed by management. The comparatives for Fiscals 2011 and 2010 have been
updated to reflect this reclassification.
Recent Accounting Pronouncements Adopted
Comprehensive Income
The Company adopted Accounting Standards Update No. 2011-05, Comprehensive Income (Topic 220)—
Presentation of Comprehensive Income (“ASU 2011-05”), effective January 1, 2012, ASU 2011-5 was applied
retrospectively and requires the Company to present the total of comprehensive income, the components of net income,
and the components of other comprehensive income either in a single continuous statement of comprehensive income or
in two separate but consecutive statements. ASU 2011-05 eliminates the option to present the components of other
comprehensive income as part of the statement of equity.
Fair Value Measurement and Disclosures
The Company adopted Accounting Standards Update No. 2011-04, Amendments to Achieve Common Fair
Value Measurement and Disclosure Requirements in U.S. GAAP and International Financial Reporting Standards
(Topic 820)—Fair Value Measurement (“ASU 2011-04”), effective January 1, 2012 and applied retrospectively, which
provides a consistent definition of fair value and ensures that the fair value measurement and disclosure requirements are
similar between U.S. GAAP and International Financial Reporting Standards. ASU 2011-04 changes certain fair value
measurement principles and enhances the disclosure requirements particularly for level 3 fair value measurements (as
defined in note 14 below). The adoption of ASU 2011-08 did not impact the fair value measurements of our assets
and/or liabilities.
Testing Goodwill for Impairment
The Company adopted Accounting Standards Update No. 2011-08, Intangibles—Goodwill and Other (Topic
350)—Testing Goodwill for Impairment (“ASU 2011-08”), effective January 1, 2012, which allows entities to use a
qualitative approach to test goodwill for impairment. ASU 2011-08 permits an entity to first perform a qualitative
assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying
value. If it is concluded that this is the case, it is necessary to perform the currently prescribed two-step goodwill
impairment test. Otherwise, the two-step goodwill impairment test is not required. The adoption of ASU 2011-08 did not
materially impact the carrying value of our recorded goodwill. The Company will perform its next annual goodwill
impairment testing on December 31, 2013.
Recent Accounting Pronouncements Not Yet Adopted
In July 2012, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No.
2012-02, Intangibles — Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment
(“ASU 2012-02”) to allow entities to use a qualitative approach to test indefinite-lived intangible assets for
impairment. ASU 2012-02 allows an entity to first perform a qualitative assessment to determine whether it is more
likely than not that the indefinite-lived intangible asset is impaired. If an entity concludes that this is the case, it is