L'Association Des Francophones De Nanaimo

Notes to the Financial Statements
For the year ended March 31, 2010
(Unaudited)

Purpose of the Association

The Association was incorporated under the Society Act of British Columbia on March 21, 1978 as a not-for-profit
organization. It is an autonomous body whose purpose is to unite Francophones in the Nanaimo area and to promote the
French language and organized and promote various cultural activities.

The Association is exempt from income tax provided certain requirements of the Income Tax Act are met.

Change in accounting policies

Capital Disclosures

Effective April 1, 2009, the Association adopted the Canadian Institute of Chartered Accountants’ new recommendations for
disclosures about capital. Section 1535 Capital Disclosures establishes standards for disclosing what an entity regards as
capital and an entity’s objectives, policies and processes for managing its capital. The Section also prescribes disclosure
regarding whether an entity has complied with any externally imposed capital requirements, and if not, the consequences of
such non-compliance.

The adoption of this new standard did not have a material impact on the Association's financial statements.

Significant accounting policies

The financial statements have been prepared in accordance with Canadian generally accepted accounting principles using
the following significant accounting policies:

Revenue recognition

The Association follows the deferral method of accounting for contributions. Restricted contributions are recognized as
revenue in the year in which the related expenses are incurred. Unrestricted contributions are recognized as revenue when
received or receivable if the amount to be received can be reasonably estimated and collection is reasonably assured.

Grant revenue is recognized as revenue in the funding period or when the expenditure is made, as applicable. Donation
revenue is recognized when the contribution is received. Gifts in kind are recognized in the year the related materials or
services are used. Goods sold, fees and miscellaneous revenue are recognized when cash is received and the service or
product is delivered.

Inventory

Inventory is valued at the lower of cost and net realizable value. Cost for purchased inventory is determined by the
weighted average method. Cost for contributed inventory is determined by the fair value of the contributed items. Net
realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and
selling costs.