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L'Association Des Francophones De Nanaimo

Notes to the Financial Statements
For the year ended March 31, 2009

Event costs
2009 2008

Marketing, promotion and advertising 186,412 155,158
Performers 40,343 26,217
Materials and incidentals 30,694 32,757
Accommodations, food and technical services 12,800 13,062
Other costs 1,147 880

271,396 228,074

Economic dependence

The Association's main source of income is derived from grants from the Federal and Provincial Governments and their
agencies. It's ability to continue-viable operations is dependent upon their continued support.

Financial instruments

The Association as part of its operations carries a number of financial instruments. It is management's opinion that the
Association is not exposed to significant interest, currency or credit risks arising from these financial instruments except as
otherwise disclosed.

Risk management policy
Due to the small size of the association, the Association has no formal risk management policy.
Credit risk

Accounts receivable from government agencies in connection with grant revenue represents 86% (2008 - 90%) of total
accounts receivable as at March 31, 2009. The balance of accounts receivable is widely distributed. The Association
believes that there is minimal risk associated with the collection of these amounts.

Cash, short term investments and investments are held by Canadian financial institutions. Credit exposure is limited due to
the quality of the financial institutions that hold cash and term deposits.

Interest rate risk

Interest rate risk is the risk that the value of a financial instrument might be adversely affected by a change in the interest
rates. Changes in market interest rates may have an effect on the cash flows associated with some financial assets and
liabilities, known as cash flow risk, and on the fair value of other financial assets or liabilities, known as price risk. In
seeking to minimize the risks from interest rate fluctuations, the Association manages exposure through investing in term
deposits with short maturities. The Association is exposed to interest rate price risk primarily relating to its short term
investment with a carrying value of $52,418 (2008 - $50,297) and its investment with a carrying value of $27,827 (2008 -
$26,253)which have interest rates of 2.05% and 5.25% respectively.

Fair value of financial instruments

The carrying amount of cash, short term investment, accounts receivable, bank indebtedness, and accounts payable and
accruals approximates their fair value due to the short-term maturities of these items. The fair value of investment
approximates its carrying value as its interest rate is adjusted to current market values annually.

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