Slide 1: IFRS Briefing
IFRS Briefing Fiscal Year Beginning April 1, 2010 May 19, 2011 CAE Inc. Confidential and/or Proprietary Information
Slide 2: Cautionary statements
Cautionary statements Accounting policies determined but impacts to the opening IFRS Balance Sheet should not be considered complete or final This document is not a substitute for reading the financial statements and management discussion & analysis Modifications are possible as ► Our estimates, ass
Slide 3: Opening Balance Sheet
Opening Balance Sheet As at April 1, 2010 Related Assets, Related Liabilities, (amounts in millions) Assets deferred tax net Impact Liabilities deferred tax net impact Equity Balances as per CDN GAAP 2,622 2,622 1,466 1,466 1,156 IFRS measurement adjustments from: Leases 141 - 141 176 (12) 164 (23)
Slide 4: Major accounting policy impacts: Leases
Major accounting policy impacts Leases 29 full-flight simulators classified and accounted for as operating leases under Canadian GAAP In line with IFRS: ► 24 simulators leases qualify for capital lease treatment ► 5 simulators leases retain operating lease classification ► 3 buildings classified as
Slide 5: Major accounting policy impacts: Employee benefits (pension)
Major accounting policy impacts Employee benefits (pension) Total after-tax adjustment to equity of $57M Actuarial gains and losses on retirement benefit plans fully recognized on balance sheet ► Consistent with IFRS implementation by other Canadian organizations ► Treatment aligned with US GAAP ► S
Slide 6: Major accounting policy impacts: Government assistance
Major accounting policy impacts Government assistance Government assistance conditionally repayable by royalties: Should be recognized as a financial liability under IFRS ► Based on future projections ► Measured at net present value of estimated payments Long-term obligation recognized on balance
Slide 7: Major accounting policy impacts: Property, Plant & Equipment
Major accounting policy impacts Property Plant & Equipment (PP&E) Total PP&E impact of $110M Borrowing costs (capitalized interest) ► Under IFRS, interest costs relating to the construction of all qualifying assets must be capitalized as part of the cost of that asset on or after the date of transit
Slide 8: Major accounting policy impacts: Deferred tax on major items
Major accounting policy impacts Deferred tax on major items Recognition of deferred tax assets ► Only to the extent that their realization is probable Considerations of what is probable include the country in which the transaction is recorded, the historical taxable profits of subsidiaries and the
Slide 9: Additional IFRS considerations
Additional IFRS considerations Business Acquisitions ► Beginning April 1, 2010 under IFRS, acquisition-related costs to be recognized as expenses in the periods in which they are incurred Aligned with US GAAP Cumulative Translation Adjustment (CTA) ► CTA reset to $0 ► $226M re-classed from OCI to
Slide 10: Additional IFRS considerations (cont.)
Additional IFRS considerations (cont.) International Accounting Standard Board (IASB) work plan ► Revenue recognition Revenue recognition for the sale of training devices using percentage-of- completion method is appropriate based on current standard Exposure draft released • Single model for al
Slide 11: IFRS reconciliation: Opening equity as at April 1, 2010
IFRS reconciliation Opening equity as at April 1, 2010 Millions CAD$ $1,156 ($35) (30.8%) ($78) ($356) ($138) $5 $800 ($85) ($25) CAE Equity Leases Employee Government Property Borrowing Income CAE Equity (CDN GAAP) Benefits Royalty Plant & Costs Taxes & (IFRS) Obligations Equipment Other 11 CAE Inc
Slide 12: IFRS reconciliation: Q3F11 YTD consolidated profit
IFRS reconciliation Q3F11 YTD consolidated profit Millions CAD$ $4.0 $0.9 (4.3%) $120.1 ($5.2) ($0.6) ($1.9) $114.9 ($4.4) $(3.2) Profit (CDN Leases Employee Government Property Borrowing Income Profit (IFRS) GAAP) Benefits Royalty Plant & Costs Taxes & Obligations Equipment Other 12 CAE Inc. Confid
Slide 13: Question period
Question period 13 CAE Inc. Confidential and/or Proprietary Information