Tucows 2013 Annual Report Download - page 46

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Depreciation costs for Fiscal 2013 remained essentially flat at $0.2 million.
LOSS ON DISPOSITION OF PROPERTY AND EQUIPMENT
Year ended December 31,
2013
2012
Loss on disposition of property and equipment
$
-
$
118,944
(Decrease) increase over prior period
$
(118,944
)
Decrease - percentage
(100
)%
Percentage of net revenues
-
%
0
%
As part of our ongoing initiatives to improve the efficiency of our production environment, we retired some older
computer hardware at our co-location facilities during Fiscal 2012, which resulted in a loss on the disposition of such
equipment.
AMORTIZATION OF INTANGIBLE ASSETS
Year ended December 31,
2013
2012
Amortization of intangible assets
$
876,120
$
876,120
Decrease over prior period
$
-
Decrease - percentage
-
%
Percentage of net revenues
1
%
1
%
Amortization of intangible assets consists of amounts arising in connection with the acquisition of Innerwise, Inc. in
July 2007 and the acquisition of EPAG in August 2011.
The brand and customer relationships acquired in connection with the acquisitions of Innerwise Inc. and EPAG are
being amortized on a straight-line basis over seven years.
Technology acquired in connection with the acquisition of EPAG is amortized on a straight-line basis over two
years.
47
LOSS (GAIN) ON CURRENCY FORWARD CONTRACTS
Although our functional currency is the U.S. dollar, a major portion of our fixed expenses are incurred in Canadian
dollars. Our goal with regard to foreign currency exposure is, to the extent possible; to achieve operational cost certainty,
manage financial exposure to certain foreign exchange fluctuations and to neutralize some of the impact of foreign currency
exchange movements. Accordingly, we enter into foreign exchange contracts to mitigate the exchange rate risk on portions of
our Canadian dollar exposure.
Year ended December 31,
2013
2012
Loss (gain) on currency forward contracts
$
676,120
$
(682,851
)
Increase over prior period
$
1,358,971
Increase - percentage
(199
)%
Percentage of net revenues
1
%
(1
)%
We have entered into certain forward exchange contracts that do not comply with the requirements of hedge
accounting to meet a portion of our future Canadian dollar requirements through December 2014. The impact of the fair
value adjustment on outstanding contracts for Fiscal 2013 was a net loss of $0.5 million, compared to a net gain of $1.1
million for Fiscal 2012. The impact of the fair value adjustment on outstanding contracts was increased by a realized loss
upon settlement of currency forward contracts of $0.2 million for Fiscal 2013 and partially offset by a realized loss of $0.4
million for Fiscal 2012.