Financial Information
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2) Accounting changes:
In July 2007, “CICA” revised handbook Section 1506, Accounting Changes, which requires that voluntary changes in accounting policy be made only if they result in the financial statements providing more reliable and more relevant information and that material prior period errors are corrected retrospectively. The section applies to interim and annual financial statements effective for periods beginning on or after January 1, 2007. The adoption of this Section did not have a material impact on the Company’s consolidated financial statements.
3) Equity:
The Company adopted Handbook Section 3251, “Equity,” on November 1, 2006. Section 3251 establishes standards for the presentation of equity and changes in equity during reporting years beginning after November 1, 2006. Financial statements of prior years have not been restated for any specified adjustments, as the effect on the Company’s consolidated financial statements is not material.
4) Stock-based compensation for employees eligible to retire before the vesting date:
Emerging Issues Committee Abstract 162, Stock-based compensation for Employees Eligible to Retire Before the Vesting Date (“EIC-162”), addresses how compensation cost should be accounted for in the case of a stock-based award that contains provisions that allow for the option to continue vesting in accordance with the stated vesting terms after the employee has retired from the entity when the grantee is an employee who is eligible to retire during the vesting period. EIC 162 requires the reporting enterprise to consider the substantive vesting period rather than the stated vesting terms. EIC-162 is to be retroactively applied, with the restatement of prior periods for all stock-based compensation awards accounted for in accordance with CICA handbook Section 3870 in financial statements issued for interim and annual periods on or after December 31, 2006. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.
(O) Future Accounting Pronouncements for 2008
(i) Financial Instruments – Disclosure and Presentation: In December 2006, the CICA issued Section 3862, “Financial Instruments Disclosures,” and Section 3863,“Financial Instruments, presentation.” These standards provide additional guidance on disclosing risks related to recognized and unrecognized financial instruments and how those risks are managed. This Section applies to interim and annual financial statements relating to fiscal years beginning on or after October 1, 2007. The Company is currently evaluating the impact of adopting these standards on the consolidated financial statements.
(ii) Capital disclosures: CICA issued Handbook Section 1535, Capital Disclosures, which provides standards for disclosures regarding a company’s capital and how it is managed. Enhanced disclosure with respect to the objectives, policies and processes for managing capital and quantitative disclosures about what a company regards as capital is required. These recommendations are effective for fiscal years beginning on or after October 1, 2007 and, therefore, the Company will be required to implement these standards on November 1, 2007. The Company is currently evaluating the impact of this standard on the consolidated financial statements.
(iii) Inventory: In June 2007, the CICA issued Section 3031, “Inventories,” which requires inventory to be measured at lower of cost and net realizable value. The standard also provides guidance on the costs that can be capitalized. In addition, previous inventory write-downs must be reversed if the economic circumstances have changed to support an increased inventory value. The standard is effective for our annual and interim periods beginning on or after January 1, 2008 and, therefore, the Company will be required to implement this standard on February 1, 2008. The Company is currently evaluating the impact of this standard on the consolidated financial statements.
3. DEFERRED CHARGES
| 2007 | 2006 | |
| $ | $ | |
| Deferred stock compensation | - | 12,632 |
| Deferred development costs (net of accumulated amortization of $75,136; 2005 - $65,545) | 11,187 | 20,779 |
| 11,187 | 33,411 |
4. PROPERTY, PLANT AND EQUIPMENT
| 2006 | 2006 | |||
| Cost $ | Accumulated Amortization $ | Cost $ | Accumulated Amortization $ | |
| Land | 600,000 | - | 600,000 | - |
| Building | 2,208,069 | 164,752 | 2,191,007 | 54,775 |
| Rental equipment | 19,494,802 | 7,023,290 | 17,225,520 | 6,316,650 |
| Computer equipment | 652,714 | 514,074 | 600,204 | 465,909 |
| Computer software | 335,075 | 229,644 | 310,078 | 189,816 |
| Furniture and fixtures | 375,358 | 233,938 | 360,116 | 200,489 |
| Moulding equipment | 57,386 | 56,888 | 57,386 | 50,650 |
| 23,723,404 | 8,222,586 | 21,344,311 | 7,278,289 | |
| Net Book Value | 15,500,818 | 14,066,022 | ||
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Testimonials
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