The preparation of these unaudited interim consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the accompanying notes. In the opinion of management, these unaudited interim consolidated financial statements reflect all adjustments necessary to state fairly the results for the periods presented. Actual results could differ materially from these estimates and the operating results for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the full fiscal year ending April 30, 2011.
2. Recently Issued Accounting Standards
International Financial Reporting Standards
The Accounting Standards Board of Canada (AcSB) plans to converge Canadian GAAP for publicly accountable enterprises with International Financial Reporting Standards (IFRS) over a transition period that will end effective January 1, 2011 with the adoption of IFRS. The AcSB announced on February 13, 2008 that IFRS will be required in 2011 for publicly accountable profit-oriented enterprises. The changeover date is for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. Starting with the first quarter of fiscal 2012, the Company will provide unaudited consolidated financial information in accordance with IFRS, including comparative figures for fiscal 2011.
The Company has completed a preliminary assessment of the accounting and reporting differences under IFRS as compared to Canadian GAAP. However, management has not yet finalized its determination of the impact of these differences on the consolidated financial statements. As this assessment is finalized, the Company intends to disclose such impacts in its future consolidated financial statements.
In the period leading up to the changeover, the AcSB will continue to issue accounting standards that are converged with IFRS, thus mitigating the impact of adopting IFRS at the changeover date. The International Accounting Standards Board will also continue to issue new accounting standards during the conversion period and, as a result, the final impact of IFRS on the Company's consolidated financial statements will only be measured once all the IFRS applicable standards at the conversion date are known.
Business Combinations
In January 2009, the CICA issued Section 1582, Business Combinations, replacing Section 1581, Business Combinations. This new Section will be applicable to financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier application is permitted. The Section establishes standards for the accounting for a business combination. The Company does not anticipate that the adoption of the new standard will have a significant impact on the consolidated financial statements of the Company.
Consolidated Financial Statements
In January 2009, the CICA issued Section 1601, Consolidated Financial Statements, and Section 1602, Non- Controlling Interests, which together replace Section 1600, Consolidated Financial Statements. These new Sections will be applicable to financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption is permitted. Section 1601 establishes standards for the preparation of consolidated financial statements. Section 1602 establishes standards for accounting for a non-controlling interest in a subsidiary in consolidated financial statements subsequent to a business combination. The Company is currently evaluating the impact of the adoption of these new Sections on the consolidated financial statements.
3. Shareholders' equity and other comprehensive income
The following are the changes in shareholders' equity for the nine months ended January 31, 2011 and for the year ended April 30, 2010:
Accumu-
lated
Other
Contri- Compre-
Common Common buted Retained hensive
Shares Shares Surplus Earnings Income Total
(Number) ($) ($) ($) ($) ($)
---------------------------------------------------------------------------
Balance at April
30, 2010 11,763,626 $126,573 $3,452 $22,702 $1,614 $154,341
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Net income - - - 19,147 - 19,147
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Dividends - - - (8,855) - (8,855)
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Employee and
Director Stock
Option Plan 102,303 2,912 (889) - - 2,023
---------------------------------------------------------------------------
Employee and
Director Stock
Purchase
Program 13,474 155 (23) - - 132
---------------------------------------------------------------------------
Restricted share
unit plan - (1,261) (824) - - (2,085)
---------------------------------------------------------------------------
Stock-based
compensation - - 1,415 - - 1,415
---------------------------------------------------------------------------
Other
comprehensive
income - - - - (1,099) (1,099)
---------------------------------------------------------------------------
Balance at
January 31, 2011 11,879,403 $128,379 $3,131 $32,994 $515 $165,019
---------------------------------------------------------------------------
Accumu-
lated
Other
Contri- Compre-
Common Common buted Retained hensive
Shares Shares Surplus Earnings Income Total
(Number) ($) ($) ($) ($) ($)
---------------------------------------------------------------------------
Balance at April
30, 2009 10,184,323 $94,741 $3,753 $11,607 $446 $110,547
---------------------------------------------------------------------------
Net income - - - 21,750 - 21,750
---------------------------------------------------------------------------
Dividends - - - (10,655) - (10,655)
---------------------------------------------------------------------------
Employee and
Director Stock
Option Plan 119,475 2,144 (882) - - 1,262
---------------------------------------------------------------------------
Employee and
Director Stock
Purchase
Program 22,328 496 (337) - - 159
---------------------------------------------------------------------------
Restricted share
unit plan - (601) (271) - - (872)
---------------------------------------------------------------------------
Stock-based
compensation - - 1,189 - - 1,189
---------------------------------------------------------------------------
Equity financing 1,437,500 29,793 - - - 29,793
---------------------------------------------------------------------------
Other
comprehensive
income - - - - 1,168 1,168
---------------------------------------------------------------------------
Balance at April
30, 2010 11,763,626 $126,573 $3,452 $22,702 $1,614 $154,341
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4. Earnings per Share
