L' Association Des Francophones De Nanaimo

Notes to the Financial Statements
For the year ended March 31, 2008

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 organize 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

Financial instruments.

Effective April 1, 2007, the Association adopted the Canadian Institute of Chartered Accountants’ new recommendations
for the recognition and measurement of financial instruments, and amendments to the existing presentation and disclosure
standards

CICA 1530.Comprehensive Income establishes standards for reporting and displaying certain gains and losses, such as
unrealized gains and losses related to cash flow hedges or available-for-sale financial assets, outside of excess of revenues
over expenses, in a statement of comprehensive income (loss). Comprehensive income (loss) is defined as the change in
equity of the Association arising from transactions and other events and circumstances, except those resulting from owner
investment and distribution. The association does not have any Financial Instruments that result in comprehensive income.
Accumulated comprehensive income (loss) is separately disclosed as a component of net assets. Although the requirements
of CICA 1530 Comprehensive Income are not applicable to not-for-profit organizations, amendments to CICA 4400 Not-
For-Profit Organizations require presentation of gains, losses, revenues and expenses arising from derivatives, hedges and
other financial instruments as separate components of net assets. The Association had no items requiring reclassification to
net assets. 7

The application of hedge accounting is covered in CICA 3865 Hedges. The Association does not have any transactions
which qualify for hedge accounting.

CICA 3855 Financial Instruments — Recognition and Measurement establishes standards for recognizing and measuring
financial assets, financial liabilities and derivatives. CICA 3861 Financial Instruments — Disclosure and Presentation
discusses the presentation and disclosure of these items. Financial instruments are defined as a contractual right to either
receive or deliver cash or another financial instrument to another party.

As described in Accounting Policies, Note 3, the Association recognizes its held for trading financial assets and liabilities at
their fair value. Prior to this classification, required at the time the Association adopted the Financial Instruments standards,
these items were recognized at their historical cost, adjusted for any permanent impairment of their market value. The effect
of this change in accounting policy in the current period had no impact on the financial statements.

As described in Accounting Policies, Note 3, the Association’s loans and receivables financial assets, and its other financial
liabilities, are recognized at their amortized cost, using the effective interest method. Prior to this classification, these items
were recognized at their historical cost, adjusted for any permanent impairment. The effect of this change in accounting
policy in the current period had no impact on the financial statements.

The new requirements were applied prospectively and prior periods have not been restated.

Significant accounting policies

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

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