Page 44 - SIGA Annual Report 2014

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NOTES TO
THE FINANCIAL
STATEMENTS
YEAR ENDED
MARCH 31, 2014
44
2. BASIS OF PREPARATION AND STATEMENT OF COMPLIANCE
These financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued
by the International Accounting Standards Board (“IASB”).
These financial statements for the year ended March 31, 2014, were authorized for issue by the Board of Directors (the “Board”)
on June 4, 2014.
SIGA has prepared these financial statements using the historical cost basis unless otherwise noted in the significant accounting
policies. These financial statements are presented in Canadian dollars, which is SIGA’s functional currency.
3. SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies used in the preparation of these financial statements are summarized below. These accounting
policies have been applied consistently to all years presented in these financial statements.
Use of Estimates, Key Judgments and Assumptions
The preparation of the financial statements in conformity with IFRS requires management to make judgments, estimates and
assumptions that affect the application of accounting policies and reported amounts of assets, liabilities, and disclosure of
contingent assets and contingent liabilities at the date of these financial statements as well as the reported amounts of revenue
and expenses during the reporting year.
Accordingly, actual results could differ from those estimates. Estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognized in the year in which the estimates are revised and in any future years affected.
Significant areas requiring the use of management estimates, judgments and assumptions are further described in the following
summary of significant accounting policies and related notes:
Useful lives and depreciation and amortization of property and equipment and intangible assets (Notes 7 and 8)
Customer loyalty program
Impairment of non-financial assets
Cash and Cash Equivalents
Cash and cash equivalents includes cash on hand and on deposit with an original maturity of less than or equal to three months,
and certain short-term investments. The short-term investments included in cash and cash equivalents are highly liquid investments
with an original maturity of less than or equal to three months.
Short-Term Investments
Short-term investments include any investments that have a term of less than one year from the statement of financial position date.
Accounts Receivable and Allowance for Doubtful Accounts
Management evaluates collectability of receivables depending on the customer and the nature of the balance. Collectability of
receivables is reviewed and the allowance for doubtful accounts is adjusted quarterly if required. Account balances are charged
to comprehensive income when management determines that it is probable that the receivable will not be collected.
Inventories
Inventories are valued at the lower of cost and net realizable value. The cost of inventories is determined using the most recent
cost. Net realizable value is the estimated selling price in the ordinary course of business less all estimated costs to make the sale.