# Annual Report 2012/13

Integr i ty & Mutual R espect

S usta i nab i l i ty

C ont i nuous L earn i ng

A ccountab i l i ty

S afetyCSA Group Annual Report 2012 | 2013 1 

# Table of Contents

Global 2 Sustainability 3 Innovation 4 Chair & CEO Message 5 Board of Directors 8 Executive Operations Committee 9 Financials 10 Independent Auditor’s Report 11 Consolidated Statements of Financial Position 13 Consolidated Statements of Changes in Net Assets 14 Consolidated Statements of Income 15 Consolidated Statements of Comprehensive Income 16 Consolidated Statements of Cash Flows 17 Notes to Consolidated Financial Statements 18CSA Group Annual Report 2012 | 2013 2 

# Global
New European lab boosts global services for customers. European manufacturers supplying global and North American markets can now turn to CSA Group’s convenient and sophisticated environmental test facility in Strasskirchen, Germany. It provides localized testing and international compliance management services for automotive, e-vehicles, Electromagnetic Compatibility (EMC), power tools, IT, safety and environmental, home appliances and other product categories. We are working on a new lab in Frankfurt to provide additional service offerings to our customers.
Investments in China improve customer service A new wire and cable laboratory in Guangzhou, the first in the southern region of China, provides localized testing and certification to Canadian, U.S. and other international standards. In Kunshan, the centre of electronic and photovoltaic (PV) manufacturers of China, we are building a new laboratory to increase capacity for PV modules, grid-connected inverters and components that must meet North American and IEC standards.
Framework strengthens global training and development To better serve global clients with their training and development needs, CSA Group has adopted standards of practice for workplace learning and development professionals. The competencies, created by the Canadian Society for Training and Development, are a model and benchmark against which our staff can better assess their performance, identify opportunities for skills improvement and ensure quality service to clients. N ext door or around the world, CSA G roup is there to serve... to help advance safety and performanceCSA Group Annual Report 2012 | 2013 3 

# Sustainability
Standards take aim at climate change impacts Drought, hurricanes, melting permafrost... CSA Group has been exploring the effects of climate change on infrastructure. In 2012, we were selected to develop new standards for Canada’s far northern cities, towns and aboriginal communities under the Northern Infrastructure Standardization Initiative, led by the Standards Council of Canada. The standards pertain to foundations of new buildings, permafrost degradation on existing buildings, changing snow loads in the North, and community drainage systems.
Certification to sustainability standard helps mobilize change To help manufacturers support their environmental claims, CSA Group offers testing and certification to sustainability standards for the appliance industry. In 2012, LG Electronics became the first company to have its refrigerators certified to CSA SPE-7001-12 Sustainability standard for household refrigeration appliances . The associated sustainability mark is a visible indicator to retailers, regulators and consumers that a product has met the standard’s environmental performance requirements.
New program focuses on disclosure of environmental performance As a Product Category Rules (PCR) Program Operator, CSA Group now offers additional services to organizations and industries concerned about sustainability, transparency and credibility in environmental performance claims. Manufacturers use PCRs to create Type III Environmental Product Declarations that disclose the environmental performance of products over their life cycle - including measurement of carbon footprint and energy consumption.
Acquisition enhances services for energy efficient lighting Our acquisition of Orb Optronix, near Seattle, presents our growing roster of lighting clients with new state-of-the-art, LED and lighting metrology testing capabilities. This adds to our established presence in Atlanta for testing LED and lighting products to more than 75 standards as well as third-party ENERGY STAR ®

### and other requirements; in Cleveland and Toronto for energy efficiency verification (EEV) services; and in China for LED lighting testing and certification. For a greener, cleaner world... CSA G roup nurtures sustainable products and practicesCSA Group Annual Report 2012 | 2013 4 

# Innovative
Announcing the first bi-national carbon capture and storage standard In a turning point for carbon capture and storage (CCS), a practice that scientists estimate could reduce emissions from industrial plants by 85 to 95 per cent (Intergovernmental Panel on Climate Change), CSA Group has released a bi-national Canada-USA consensus standard. CSA Z741 Geological storage of carbon dioxidewas developed with a technical committee of more than 30 professionals representing industry, regulators, researchers and NGOs from both sides of the border. Its goal is to help promote environmentally safe and long-term carbon dioxide containment in a way that minimizes risks to the environment and human health.
Landmark standard addresses mental health in the workplace A study commissioned by the Mental Health Commission of Canada (MHCC) shows that the economic cost from mental health problems and illnesses is at least $50 billion per year, representing 2.8% of the country’s 2011 gross domestic product. Lauded by business, labour and government, a new voluntary national standard developed by CSA Group and the Bureau de normalisation du Québec (BNQ), CAN/CSA-Z1003-12/BNQ 9700-803/2012 , Psychological Health and Safety in the Workplace , provides a systematic approach to help develop and sustain a psychologically healthy and safe workplace.
CSA standard becomes first on nanotechnologies in Canada Nanotechnology, which uses unique material properties in near-limitless applications, presents novel challenges with respect to safety. CSA Z12885, Nanotechnologies - Exposure control program for engineered nanomaterials in occupational settingsprovides guidance for safe use in the workplace. Canada has been providing vital input to the International Organization for Standardization (ISO), and this standard marks the first to be adopted in Canada. Anticipating new issues and corners... CSA Group ushers in ground-breaking solutionsCSA Group Annual Report 2012 | 2013 5 

# Chair & CEO Message
Serving our stakeholders through expansion and growth With a vision of a better, safer, more sustainable world where standards work for people and business, CSA Group thrives by serving the needs of: customers around the world who want access to markets for their products, members who expect value from their association, regulators and consumers who need credible proof of safer and sustainable products and practices. In 2012/2013, we served the interests of these stakeholders through expanded global service offerings, solutions for sustainability, and resources that help advance innovation. We opened 6 new laboratories, hired new talent across the globe and will continue to do so. We solidified our single global brand. And, with a global outlook and scope, we invested in critical service initiatives that will strengthen our competitiveness.

Business results Revenues during this fiscal year totalled $ 256 million, an increase of 8% against the previous year. This increase includes satisfactory contributions from our acquisitions in Europe. We are proud to say again that all regions, business units and corporate functions achieved their business objectives over the past year.
Global service expansion Accelerating investment in our laboratories, service offerings and employees is at the core of our global corporate strategy and key to serving our customers’ needs and expectations. In 2012/13 we made major strides on this front. The opening of a new laboratory in Strasskirchen, Germany added to the aggressive expansion we have undertaken in recent years on behalf of our European clients. In Asia, our new wire and cable lab in Guangzhou, photovoltaic lab in Kunshan, and additional U.S. Energy Star services boosted our capacity for manufacturers there. In North America, expanded service offerings in Cleveland and the acquisition of Orb Optronix enhanced LED service to customers. During 2012/13, we continued to invest in solutions that drive sustainability. We are especially proud of our work on new standards that will help manage the effects of climate change on Northern infrastructure as well as solutions that will help bring about greater transparency and credibility in environmental claims.CSA Group Annual Report 2012 | 2013 6 

### Improving value and engagement In the past year, we undertook major initiatives to improve services and enhance stakeholder value. Our Standards group introduced an innovative new Web-based platform for engaging with members. The online Communities of Interest allow for an unprecedented level of collaboration and communication among members, stakeholders and other standards users. The first four Communities – for the Electrical, Fuel-burning Equipment, Nuclear and Occupational Health and Safety (OHS) sectors – went live in February. In the weeks and months ahead, we will add new Communities and roll out additional features and functionality. In 2012/13, we also worked to enhance our role and influence in consumer product safety. We were pleased to lend official support to the Federal Government of Canada’s introduction of the new Combating Counterfeit Products Act, which proposes changes to the Trade-marks Actand the Copyright Act to prohibit the import and export of counterfeit trademark goods. We have been pursuing a robust strategy for public outreach and government relations. Last fall, a Standards education day in Ottawa drew considerable interest in CSA’s role in public safety, occupational health and safety, nanotechnology and emerging technologies such as electric vehicles and fuel cells. We also invested in employee engagement and education and training initiatives. This year, we introduced talent management and total reward programs that consistently recognize employee contributions across regions and business lines; as well as leadership development and renewal programs that promote career progression, personal growth and organizational sustainability. New compensation systems have enhanced our overall global competitive position. Our commitment to social responsibility was reflected through our donations this past year to several worthy causes including Habitat for Humanity, the United Way, the Salvation Army, Dragon Boat teams, breast cancer research and others. And through our corporate asset redeployment, we have lessened our impact on landfills and found deserving homes for used equipment and furniture.
Realizing our vision and the path forward CSA Group has always been about seeing a need, making things better, breaking new ground and imagining workable solutions. We proudly added to that legacy in 2012/13. A notable example was the introduction of a voluntary national Standard on psychological health and safety in the workplace. This was a collaborative effort with the Bureau de normalisation du Québec (BNQ) and the Mental Health Commission of Canada (MHCC), which estimates that in any given year one in five people in Canada experiences a mental health problem or illness, with a cost to the economy of more than $50 billion annually.CSA Group Annual Report 2012 | 2013 7 

### As we move forward from this year of achievements and successes on all fronts, we plan to concentrate on key priorities while continuing to invest in our core businesses, growth strategies and customer service. We have a rich history in standards and service offerings for the resources industry and we intend to leverage our experience in oil, mining and other natural resources – while enhancing our contributions to renewable energy and related technologies, health and safety, infrastructure, carbon management and other leading concerns of government, industry and consumers. We will continue to grow our membership, develop smart standards and interactive products and increase market breadth. As a knowledge-based service business, we can never over-estimate the value of people. The past year’s exceptional achievements are due to the support and contribution of outstanding employees, valued customers, dedicated members, and the wise counsel of our senior leadership team and our Board of Directors. We are exceptionally grateful for their support and commitment, and are confident that together we will continue to make excellent progress and deliver on our vision and aspirations.

Robert Cook Ash Sahi Chair of the Board President and CEO CSA Group CSA GroupCSA Group Annual Report 2012 | 2013 8 

# Board of Directors

From left to right: – 1st row – 1. Sondra E. BruniDirector | St. Catharines, ON 2. Robert J. (“RJ”) FalconiCorporate Secretary, CSA Group | Bradford, ON 3. Bob Cook Chair, CSA Group | Bedford, NS 4. Ash SahiPresident and CEO, CSA Group | Caledon, ON 5. Dr. H. Roland HoseinVice-Chair, CSA Group; Vice President, Environmental Health & Safety, GE Canada | Unionville, ON 6. Dr. Malcolm E. O’HaganDirector | Chevy Chase, MD0 7. Nathalie PilonPresident, Thomas & Betts Canada | St-Jean Richelieu, QC 8. Kim A. DunphyAssistant Deputy Minister, OH&S Branch, Government of Newfoundland & Labrador | St. John’s, NL

– 2nd row – 9. David T. FungChair, HR/Compensation Committee, CSA Group; Chairman & CEO, ACDEG Group | Vancouver, BC 10. David WarnerDirector | Mississauga, ON 11. Greg B. WeeresPresident and CEO, Pacific Northern Gas Ltd. | Vancouver, BC 12. David C. MacKinnonAudit, Finance & Risk Committee, CSA Group | Wellington, ON 13. Gregory M. Thomas Executive Director, Alliance International LLG | Fort Wayne, IN Absent from photo: France Pégeot Senior Assistant Deputy Minister, Strategic Policy Fisheries and Oceans Canada | Ottawa, ON 1 2 3 4 5 6 7 8 9 10 11 12 13CSA Group Annual Report 2012 | 2013 9 

# Executive Operations Committee

1. Ash SahiPresident and CEO | CSA Group 2. Nashir Jiwani Regional Vice President, Canada | CSA Group 3. Suzanne KiralyExecutive Vice President, Global Business Strategy | CSA Group 4. Bonnie RosePresident, Standards | CSA Group 5. Magali DeprasRegional Vice President, Europe | CSA Group 6. Robert J. “RJ” FalconiCorporate Secretary | CSA Group 7. Hans PanRegional Vice President, Asia | CSA Group 8. Paul KeaneExecutive Vice President, Human Resources | CSA Group 9. Murray JohnstonExecutive Vice President, Finance & Administration | CSA Group 10. Hélène VaillancourtExecutive Vice President, Science & Engineering | CSA Group 11. Rich WeiserRegional Vice President, U.S. & Mexico | CSA Group 1 2 3 4 5 6 7 8 9 10 11CSA Group Annual Report 2012 | 2013 10 

# Financials
Management’s Statement of Responsibility The accompanying consolidated financial statements of the Canadian Standards Association (the Association) have been prepared by management in accordance with International Financial Reporting Standards (IFRS). Financial statements are not precise, since they include certain amounts based on estimates and judgments. When alternative methods exist, management has chosen those which it deems most appropriate in the circumstances in order to ensure that the consolidated financial statements are presented fairly, in all material respects, in accordance with IFRS. Management maintains adequate systems of internal accounting and administrative controls consistent with reasonable cost. Such systems are designated to provide reasonable assurance that the financial information is relevant and reliable, and that the Association’s assets are appropriately accounted for and adequately safeguarded. The Board of Directors ensures that management fulfils its responsibilities for financial reporting and internal control through an audit, finance and risk committee. This committee meets periodically with management and the external auditors to discuss internal controls, auditing matters, and financial reporting issues, and to satisfy itself that each party is properly discharging its responsibilities. The committee reviews the consolidated financial statements, and reports to the Board of Directors. The external auditors have full and direct access to the audit committee.

Signed,

Ash Sahi Murray Johnston President and Chief Executive Officer Executive Vice-President, Finance and Admin. The Canadian Standards Association The Canadian Standards AssociationCSA Group Annual Report 2012 | 2013 11 PricewaterhouseCoopers LLP North American Centre, 5700 Yonge Street, Suite 1900, North York, Ontario, Canada M2M 4K7 T: +1 416 218 1500, F: +1 416 218 1499
“PwC” refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership. May 17, 2013



### Independent Auditor’s Report To the Members of Canadian Standards Association
We have audited the accompanying consolidated financial statements of the Canadian Standards Association and its subsidiaries, which comprise the consolidated statements of financial position as at March 31, 2013 and March 31, 2012 and the consolidated statements of income, comprehensive income, changes in net assets and cash flows for the years ended March 31, 2013 and March 31, 2012 and the related notes, which comprise a summary of significant accounting policies and other explanatory information. Management’s responsibility for the consolidated financial statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained in our audits is sufficient and appropriate to provide a basis for our audit opinion.CSA Group Annual Report 2012 | 2013 12 Opinion In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of Canadian Standards Association and its subsidiaries as at March 31, 2013 and March 31, 2012 and their financial performance and their cash flows for the years ended March 31, 2013 and March 31, 2012 in accordance with International Financial Reporting Standards. Comparative information Without modifying our opinion, we draw attention to note 2 to the consolidated financial statements, which describes that Canadian Standards Association adopted International Financial Reporting Standards on April 1, 2012, with a transition date of April 1, 2011. These standards were applied retrospectively by management to the comparative information in these financial statements, including the consolidated statements of financial position as at March 31, 2012 and April 1, 2011, and the consolidated statements of income, comprehensive income, changes in net assets and cash flows for the year ended March 31, 2012 and related disclosures. We were not engaged to report on the restated comparative information as at April 1, 2011 and as such, it is unaudited.

Chartered Accountants, Licensed Public AccountantsCSA Group Annual Report 2012 | 2013 13 

## Canadian Standards Association Consolidated Statements of Financial Position
(in thousands of Canadian dollars)



### Approved by the Board of Directors

___________________________________ Director ________________________________ Director The accompanying notes are an integral part of these consolidated consolidated financial statements. March 31, 2013 $ March 31, 2012 $ April 1, 2011 $ (Unaudited) 

### Assets Current assets Cash and cash e quivalents 14,191 15,806 14,205 Trade and other receivables (note 6) 54 , 238 51,985 45,778 Inventories (note 7) 561 573 657 Prepaid expenses 7,119 5,657 4,489 Short

-term investments (note 5) 132,495 128,556 114,006 208,604 202 ,577 179,135 Non -current assets Property, plant and equipment

- net (note 8 ) 74,479 69,179 60,154 Accrued pension benefit asset (note 1 8 ) 3,639 4,311 5,263 I nvestment in associate (note 10 ) 1,056 1,422 1,035 Intangible assets ( note 9 ) 23,937 22,781 11,468 Goodwill (note 9) 15,603 12,434 4,188 327 , 318 312,704 261,243 

### Liabilities Current liabilities Trade and other payable s (note 16) 4 3 , 348 40,104 33, 3 89 Deferred revenue 38,0 78 35,225 30,901 Customer deposits 13,293 12,627 12,009 Provisions 1,832 1,966 2,106 F inance leases 158 142

- B ank loan (note 1 2 ) 2,605 2,998

- 99,314 93,062 78, 4 05 Non -current liabilities Employee future benefits (note 1 8 ) 53,182 43,752 35,494 Finance leases 450 547

- Deferred lease inducement 121 146 172 Bank loan (note 1 2 ) 15,175 17,960

- 168,242 155,467 114, 0 71 

### Net Assets Invested in property, plant and equipment 74,479 69,179 60,154 Internally reserved for specific purposes 83,401 88,156 70,444 Unreserved 18,470 4,672 14,094 176,350 162,007 144,692 Non

- controlling interest 3,201 2,752 2,123 Accumulated other comprehensive income (loss) (20,475) (7,522) 357 159,076 157,237 147,172 327,318 312,704 261,24 3 Contingencies, commitments and guarantees (n ote 2 1 )CSA Group Annual Report 2012 | 2013 14 

### Canadian Standards Association Consolidated Statements of Changes in Net Assets For the years ended March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

The accompanying notes are an integral part of these consolidated financial statements. 2013

Unreserved $ Internally reserved $ Invested in property, plant and equipment $ Accumulated other comprehensive income $ Total attributable to the Association $ Noncontrolling interest $ Total $ Balance - Beginning of year 4,672 88,156 69,179 (7,522 ) 154,485 2,752 157,237 Net i ncome for the year 26,300 (4,755) (7,202)

- 14,343 449 14,792 Investment in property, plant and equipment

- net (12,502)

- 12,502

- - - - Other comprehensive income

- - - (12,953) (12,95 3)

- (12,953) Balance - End of year 18,470 83,401 74,479 (20,475) 155,875 3,201 159,076 2012

Unreserved $ Internally reserved $ Invested in property, plant and equipment $ Accumulated other comprehensive income $ Total attributable to the Association $ Noncontrolling interest $ Total $ Balance - Beginning of year 14,094 70,444 60,154 357 145,049 2,123 147,172 Net income for the year 45,131 (22,288) (5,528)

- 17,315 629 17,944 Investment in property, plant and equipment

- net (14,553)

- 14,553

- - - - Transfers for future expenditures

- net (40,000) 40,000

- - - - - Other comprehensive income

- - - (7,879) (7,879)

- (7,879) Balance - End of year 4,672 88,156 69,179 (7,522) 154,485 2,752 157,237CSA Group Annual Report 2012 | 2013 15 

## Canadian Standards Association Consolidated Statements of Income For the years ended March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

The accompanying notes are an integral part of these consolidated financial statements. 2013 $ 2012 $ 

### Revenue 255,613 238,533 

### Operating expenses Salaries and benefits 151,520 134,011 Professional, agency and consulting 2 6,866 27,459 Travel 16,467 15,682 Property related costs 11,997 10,667 Sales, marketing and co mmunication 7,060 6,846 Depreciation 7,202 5,528 Office, laboratory and computer 5,998 4,970 Material costs 6,205 4,187 Amortization of intangible assets 1,385 1,267 Other operating expenses 13,580 11,452 248,280 222,069 

### I ncome from operations 7,333 16,464 

### Non -operating income (expense) Finance income (note 13) 9,234 3,141 Finance costs (note 14) (463) (292) Share of loss in associate (366) (328) Foreign income taxes (946) (1,041) 

### Net income for the year 14,792 17,944 

### Net income attributable to The Association 14,343 17,315 Non

- controlling interest 449 629 14,792 17,944CSA Group Annual Report 2012 | 2013 16 

## Canadian Standards Association Consolidated Statements of Comprehensive Income For the years ended March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

The accompanying notes are an integral part of these consolidated financial statements. 2013 $ 2012 $ 

### Net income for the year 14,792 17,944 

### Other comprehensive income (loss) Exchange differences on translation of net assets of foreign operations (48) 96 Gains and losses on derivatives designated in cash flow hedges in prior ye ars - (357) Actua ria l loss on employee future benefits (12,905) (7,618) (12,953) (7,879) 

### Total comprehensive income for the year 1,839 10,065 

### Comprehensive income attributable to The Association 1,390 9,436 Non

- contro lling interest 449 629 1,839 10,065CSA Group Annual Report 2012 | 2013 17 

## Canadian Standards Association Consolidated Statements of Cash Flows For the years ended March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

The accompanying notes are an integral part of these consolidated financial statements. 2013 $ 2012 $ 

### Cash provided by (used in) Operating activities Net income for the year 14,792 17,944 Add (deduct) : I tems not involving cash Share of loss in associate 366 328 Depreciation 7,202 5,528 Amortization of intangible assets 1,385 1,267 Loss on disposal of property, plant and equipment 7 1 51 Realized and un realized gain (loss) on short

-term investments 8,438 (1,394) Pension and employee future benefit expense 11,162 9,972 Amortization of lease inducement (25) (26) 43,391 33,670 Net change in non

- cash working capital balances related to operations (note 1 7) 3 ,751 4,086 Pension plan contributions (12,738) (7,165) Employee future benefit payments (1,227) (1,215) 

### Cash provided by operating activities 33,177 29,376 

### Investing activities Purchase of property, plant and equipment (12,338) (10,806) Purchase of intangible assets (1,552) (2,287) Proceeds on disposal of property, plant and equipment

- 15 Purchase of short

-term investments (43,877) ( 54,675 ) Proceeds on sale of short

-term investments 31,500 4 1,161 Investment in ass ociate company

- (714) Acquisition of subsidiaries (note 11) (5,540) (23,729) 

### Cash used in investing activities (31,807) (51,035) 

### Financing activities Proceeds from finance leases 108 786 Proceeds (repayment) of bank loan (note 12) (3,093) 22,474 

### Cash (used in) provided by financing activities (2,985) 23,260 

### Net (decrease) increase in cash and cash equivalents during the year (1,615) 1,601 

### Cash and cash equivalents - B eginning of year 15,806 14,205 

### Cash and cash equivalents - E nd of year 14,191 15,806CSA Group Annual Report 2012 | 2013 18 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(1 ) 

### 1 General information The consolidated financial statements of the Canadian Standards Association (or, the Association) and its subsidiaries (together, CSA Group) for the year ended March 31, 2013 were approved in accordance with a resolution of the Board of Directors dated May 17, 2013. The Association is domiciled in Canada. The registered head office is located at 178 Rexdale Blvd., Toronto, Ontario, Canada, M9W 1R3. The Association was originally incorporated by Letters Patent dated January 21, 1919 under the federal laws of Canada and was continued under the Canada Not-for-profit Corporations Act (the Act) pursuant to a Certificate of Continuance issued on August 17, 2012. The Association is an independent membership-based corporation without share capital, shareholders or other owners that is governed by the Act. CSA Group is engaged in the development of consensus-based standards in the areas of safety, quality and performance as well as the testing and certification of conformance to various standards that serve business, industry, government and consumers. Testing and certification services extend worldwide to medical, electrical, mechanical, plumbing, gas and a variety of other products. Similarly, consumer product evaluation, inspection and advisory services are provided for retailers and manufacturers. CSA Group’s Vision and Purpose is “a better, safer, more sustainable world where standards work for people and business.”



### 2 Summary of significant accounting policies Basis of preparation The Association prepared its consolidated financial statements in accordance with Canadian generally accepted accounting principles (GAAP) as defined in the Handbook of The Canadian Institute of Chartered Accountants (CICA Handbook). In 2010, the CICA Handbook was revised to incorporate International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and to allow private sector not-for-profit organizations to apply these standards effective for years beginning on or after January 1, 2012. Accordingly, these are the Association’s first annual consolidated financial statements prepared in accordance with IFRS as issued by the IASB. In these financial statements, the term Canadian GAAP refers to Canadian GAAP before the adoption of IFRS. The consolidated financial statements have been prepared in compliance with IFRS. Subject to certain transition exemptions and exceptions disclosed in note 22, the Association has consistently applied the accounting policies used in the preparation of its opening IFRS consolidated statement of financial position at April 1, 2011 and throughout all periods presented, as if these policies had always been in effect. Note 22 discloses the impact of the transition to IFRS on the Association’s reported financial position and financial performance, including the nature and effect of significant changes in accounting policies from those used in the Association’s consolidated financial statements for the year ended March 31, 2012 prepared under Canadian GAAP. The consolidated financial statements have been prepared on a historical cost basis, except for derivative financial instruments and short-term investments, which are measured at fair value.CSA Group Annual Report 2012 | 2013 19 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(2 ) The Association’s year-end occurs on the last Friday of March. For the current year, the actual year-end date is March 29, 2013. For the prior year, the year-end date was March 30, 2012. For the purposes of these consolidated financial statements, March 31 will refer to the actual dates mentioned above. Basis of consolidation The consolidated financial statements comprise the financial statements of the Association and its subsidiaries. Subsidiaries are those entities the Association controls by having the power to govern the financial and operating policies. Subsidiaries are fully consolidated from the date on which control is obtained by the Association and de-consolidated from the date that control ceases. Intercompany transactions, balances, income and expenses, and profits and losses are eliminated. Non-controlling interests represent equity interests in subsidiaries owned by outside parties. The share of net assets of subsidiaries attributable to non-controlling interests is presented as a component of net assets. Their share of net income and comprehensive income is recognized directly in net assets. Changes in the parent company’s ownership interest in subsidiaries that do not result in a loss of control are accounted for as equity transactions. Foreign currency translation The Association’s consolidated financial statements are presented in Canadian dollars (presentation currency), which is also the Association’s functional currency. The financial statements of entities that have a functional currency different from that of the Association are translated into Canadian dollars as follows: assets and liabilities - at the closing rate at the date of the consolidated statements of financial position; and income and expenses - at the average rate of the period (as this is considered a reasonable approximation of the actual rates prevailing at the transaction dates). All resulting foreign exchange gains and losses on translation are recognized in other comprehensive income as cumulative translation adjustments. Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities are translated at the exchange rate prevailing as at the consolidated statements of financial position dates. Foreign exchange gains and losses resulting from the settlement of foreign currency transactions and from the translation of monetary assets and liabilities denominated in currencies other than the entities’ functional currency are recognized in the consolidated statements of income. Business combinations CSA Group follows the acquisition accounting method in accounting for acquisitions. The cost of an acquisition is measured as the fair value of the assets given and liabilities incurred or assumed at the date of exchange. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are initially measured at fair value at the acquisition date. The excess of the cost of acquisition over the fair value of the Association’s share of the identifiable net assets acquired, if any, is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognizedCSA Group Annual Report 2012 | 2013 20 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(3 ) directly in the consolidated statements of income. Transaction costs are expensed as they are incurred and are included in other operating expenses within the consolidated statements of income. Cash and cash equivalents Cash and cash equivalents in the consolidated statements of financial position comprise cash at banks and on hand, money market securities, and short-term deposits with an original maturity of three months or less. Inventories Inventories are stated at the lower of cost, determined on a first-in, first-out basis, and net realizable value. Net realizable value is the estimated selling price less estimated selling expenses incurred in the ordinary course of business. Financial instruments Financial assets and liabilities are recognized when CSA Group becomes a party to the contractual provisions of the financial instrument. Financial assets are derecognized when the rights to receive cash flows from the assets have expired or have been transferred and CSA Group has transferred substantially all risks and rewards of ownership. Financial liabilities are derecognized when the obligation specified in the contract is discharged, cancelled or expires. CSA Group’s financial assets include cash and cash equivalents, short-term investments, trade and other accounts receivable and derivative financial instruments. CSA Group’s financial liabilities include trade and other payables, bank loans, customer deposits, finance leases and derivative financial instruments. At initial recognition, CSA Group classifies its financial instruments in the following categories: a) Financial assets and liabilities at fair value through profit or loss: A financial asset or liability is classified in this category if acquired principally for the purpose of selling or repurchasing in the short-term. This category includes forward foreign exchange contracts entered into by CSA Group that are not designated as hedging instruments in hedge relationships and are classified as held-for-trading. CSA Group has designated its short-term investments at fair value through profit or loss with the changes charged to the consolidated statements of income. Financial instruments in this category are recognized initially and subsequently at fair value. Transaction costs are expensed in the consolidated statements of income. Gains and losses arising from changes in fairvalue are presented in the consolidated statements of income in the period in which they arise. Nonderivative financial assets and liabilities recognized at fair value through profit or loss are classified as current except for the portion expected to be realized or paid beyond 12 months of the consolidated statement of financial position date, which are classified as long-term.CSA Group Annual Report 2012 | 2013 21 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(4 ) b) Loans and receivables: Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. CSA Group’s loans and receivables comprise trade and other accounts receivable and cash and cash equivalents, and are included in current assets and liabilities due to their short-term nature. Loans and receivables are initially recognized at the amount expected to be received, less, when material, a discount to reduce the loans and receivables to fair value. Subsequently, loans and receivables are measured at amortized cost using the effective interest method less a provision for impairment. c) Financial liabilities at amortized cost: Trade and other payables, bank loans and customer deposits are initially recognized at the amount required to be paid, less, when material, a discount to reduce the financial liabilities at amortized cost to fair value. Subsequently, financial liabilities at amortized cost are measured at amortized cost using the effective interest method. Bank loans are recognized initially at fair value, net of any transaction costs incurred, and subsequently at amortized cost using the effective interest method. These are classified as current liabilities if payment is due within 12 months. Otherwise, they are presented as non-current liabilities. Impairment of financial assets at amortized cost At each reporting date, CSA Group assesses whether there is objective evidence that a financial asset is impaired. The criteria used to determine objective evidence of an impairment loss include: i) significant financial difficulty of the obligor; ii) delinquencies in interest or principal payments; and iii) the probability the borrower will enter bankruptcy or other financial reorganization. If such evidence exists, CSA Group recognizes an impairment loss as the difference between the amortized cost of the loan or receivable and the present value of the estimated future cash flows, discounted using the instrument’s original effective interest rate. The carrying amount of the asset is reduced by this amount either directly or indirectly through the use of an allowance account. Impairment losses on financial assets carried at amortized cost are reversed in subsequent periods if the amount of the loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized. Impairment of non-financial assets CSA Group assesses at each reporting date whether there is an indication that a non-financial asset may be impaired. If any indication exists, or when annual impairment testing for a non-financial asset is required, CSA Group estimates the asset’s recoverable amount. For the purpose of measuring recoverable amounts, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units or CGUs). An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use. Where the carrying amount of a non-financial asset exceeds its recoverable amount, the non-financial asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimatedCSA Group Annual Report 2012 | 2013 22 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(5 ) future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, a discounted cash flow model is used. Impairment losses are recognized in the consolidated statements of income in those expense categories consistent with the function and nature of the impaired asset. Investments in associates Associates are entities over which the Association has significant influence, but not control. The Association accounts for its investment in associates using the equity method. The Association’s share of profits or losses, and of other comprehensive income (loss) of associates is recognized in income from operations and in other comprehensive income, respectively. Unrealized gains on transactions between the Association and an associate are eliminated to the extent of the Association’s interest in the associate. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Dilution gains and losses arising from changes in interests in investments in associates are recognized in the consolidated statements of income. Property, plant, and equipment Property, plant and equipment are stated at cost, net of accumulated depreciation and/or accumulated impairment losses, if any. Cost includes expenditures that are directly attributable to the acquisition of the asset. When significant parts of property, plant and equipment are required to be replaced in intervals, CSA Group derecognizes and recognizes such parts as individual assets with specific useful lives and depreciation, respectively. All repair and maintenance costs are recognized in the consolidated statements of income as incurred. Depreciation is calculated over the estimated useful life of the asset as follows: Buildings components 5 to 50 years, straight

- line Leasehold improvements straight

- line over expected lease term Equipment 10% to 30 % declining balance, 5 to 10 years straight

- line Computer equipment 3 to 8 years straight

- line An item of property, plant and equipment is derecognized on disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the consolidated statements of income when the asset is derecognized. The assets’ residual values, useful lives, and methods of depreciation are reviewed at each financial year-end and adjusted prospectively, if appropriate.
Leases Finance leases, which transfer to CSA Group substantially all of the risks and benefits incidental to ownership of the leased item, are capitalized at the commencement of the lease at the fair value of the leased property or, ifCSA Group Annual Report 2012 | 2013 23 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(6 ) lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognized in the consolidated statements of income. Leased assets are depreciated over the shorter of the useful life of the asset and the lease term.Operating lease payments are recognized as an expense in the consolidated statements of income on a straightline basis over the lease term. Lease inducements Lease inducements represent leasehold improvements received from a landlord and the value of rent-free periods. Lease inducements are amortized on a straight-line basis over the estimated term of the lease and the amortization is recorded as a reduction of rent expense. Borrowing costs Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that take a substantial period of time to get ready for their intended use, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use. All other borrowing costs are recognized in the consolidated statements of income in the period in which they are incurred. Intangible assets Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less accumulated amortization and accumulated impairment losses. Internally generated intangible assets are capitalized if certain criteria including technical feasibility, availability for use, and probable future economic benefit, are met. Accreditation agreements are subject to regular compliance inspections and audits and requalification audits. Accreditations can be revoked in instances of unaddressed non-conformances, which have a very low probability of occurring. Hence, these assets are considered to have an indefinite life. Definite

- lived intangible assets Customer relationships and lists straight

- line over expected useful lives ranging from 15 to 22 years Agency agreements straight

- line over expected useful life of 5 years Non

- compete contracts straight

- line over expected useful lives ranging from 2 to 5 years Computer software straight

- line over expected useful lives ranging from 3 to 10 years Indefinite

- lived intangible assets Accreditation agreements indefinite life Goodwill Goodwill represents the excess of the cost of an acquired entity over the fair value of the identifiable assets acquired and liabilities assumed less any subsequent writedowns for impairment. Goodwill is allocated to each cash-generating unit or group of cash-generating units that are expected to benefit from the related business combination. Goodwill is subject to an annual impairment test or whenever events or circumstances indicate the carrying amount may not be recoverable. Goodwill impairment is assessed based on a comparison of theCSA Group Annual Report 2012 | 2013 24 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(7) recoverable amount (the higher of the fair value less cost to sell or value in use) of a cash-generating unit to the underlying carrying value of the cash-generating unit’s net assets, including goodwill. When the carryingamount of the cash-generating unit exceeds its recoverable amount, the recoverable amount of the cashgenerating unit’s goodwill is compared with its carrying amount to measure the amount of impairment, if any. Provisions Provisions are recognized when CSA Group: (i) has a present obligation, legal or constructive, as a result of a past event; (ii) it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation; and (iii) a reliable estimate can be made of the amount of the obligation. Where CSA Group expects some or all of a provision to be reimbursed, the reimbursement is recognized as a separate asset but only when the reimbursement is virtually certain. The provision is presented in the consolidated statements of income net of any reimbursement. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost. Present obligations arising under onerous contracts are recognized and measured as provisions. An onerous contract is considered to exist where CSA Group has a contract under which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received. Foreign income taxes The Association and its US subsidiary are not subject to income taxes, while other foreign subsidiaries are subject to income tax in their respective jurisdictions. Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to foreign taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, by the reporting date, in foreign jurisdictions where CSA Group operates and generates taxable income. Current income tax relating to items recognized directly in net assets or other comprehensive income is recognized in net assets or other comprehensive income and not in the consolidated statements of income. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate. In general, deferred income tax is recognized in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred income tax is not recognized if it arises from the initial recognition of goodwill or the initial recognition of an asset or liability in a transaction other than a business combination that, at the time of the transaction, affects neither the accounting nor taxable profit nor loss. Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except, in the case of subsidiaries, where the timing of the reversal of the temporary difference is controlled by CSA Group and it is probable the temporary difference will not reverse in the foreseeable future.CSA Group Annual Report 2012 | 2013 25 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(8 ) Deferred income tax is determined on a non-discounted basis using tax rates and laws that have been enacted or substantively enacted at the consolidated statements of financial position dates and are expected to apply when the deferred tax asset is realized or liability is settled. Deferred tax assets are recognized to the extent that it is probable the future taxable profit will be available against which the deductible temporary differences can be utilized. Revenue recognition Revenue, which is principally from testing, certification, registration, and other services, is recorded when the amount of revenue can be reliably measured, if it is probable that future economic benefits will flow to the entity, or when specific criteria have been met for each of the activities as described below. Revenue from the sale of goods is recognized when they are shipped. Annual fees are recorded as revenue in the period to which they relate. Standards development and other revenues are recognized based on percentage of completion. Amounts received and receivable for services not yet rendered, or annual fees relating to a future period, are included in current liabilities as customer deposits or deferred revenue, respectively, and are recognized as revenue when earned according to the Association’s revenue recognition policy. CSA Group assesses its revenue arrangements against specific criteria in order to determine whether it is acting as principal or agent. CSA Group has concluded it is acting as a principal in all of its revenue arrangements. The following specific recognition criteria must also be met before revenue is recognized:

 CSA Group has transferred to the buyer the significant risks and rewards of ownership of the goods or services;

 CSA Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods or services sold;

 the amount of revenue can be measured reliably;

 there is probability that the economic benefits associated with the transaction will flow to CSA Group; and

 the costs incurred or to be incurred in respect of the transaction can be measured reliably. Investment income, which consists of interest, dividends, and realized and unrealized gains and losses, is recorded as finance income in the consolidated statements of income. Interest income Interest income is recognized as interest accrues using the effective interest rate method, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial instrument to the net carrying amount of the financial asset.CSA Group Annual Report 2012 | 2013 26 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(9 ) Dividend income Dividend income is recognized when declared. Pensions and employee future benefits CSA Group operates defined benefit pension plans and defined contribution pension plans that require contributions to be made to them. The cost of defined contribution pension plans is charged to the consolidated statements of income as they are earned by the beneficiary. The cost of providing benefits under the defined benefit plans is determined using the projected unit credit method. The related pension asset or liability recognized in the consolidated statements of financial position is the present value of the defined benefit obligation at the consolidated statements of financial position dates less the fair value of plan assets. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high quality corporate bonds that have terms to maturity approximating the terms of the related pension liability. Actuarial gains and losses are recognized in full in the period in which they occur, in other comprehensive income. Current service cost, past service costs, actual return on plan assets and interest expense arising on the pension liability are included in the consolidated statements of income. For funded plans, surpluses are recognized only to the extent that the surplus is considered recoverable. Recoverability is primarily based on the extent to which CSA Group can unilaterally reduce future contributions to the plan.CSA Group has also agreed to provide post-employment health-care benefits to certain employees. These postemployment health-care benefits are unfunded. Employee compensated balances, such as sick leave, that accumulate but do not vest are recognized in the period in which employees have earned the related benefits in return for their service. The accumulated benefit is discounted to determine its present value as at the consolidated statements of financial position dates. Internally reserved net assets Certain net assets are restricted by the Board of Directors for specific purposes relating to the development of standards, research projects and new standards applications. Income generated from the internally reserved net assets is included in unreserved net assets. 

### 3 Significant accounting judgments, estimates and assumptions The preparation of the Association’s consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the end of the reporting period. However, uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the applicable asset or liability in future periods.CSA Group Annual Report 2012 | 2013 27 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(10 ) The key estimates and assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below. Business combinations - allocation of purchase price In business combinations, the Association acquires assets and liabilities of an acquired entity. The allocation of the purchase price involves judgment in determining the fair value of identifiable assets acquired and liabilities and contingent liabilities assumed, if any. The determination of these fair values involves a variety of estimates and assumptions including revenue growth rates, expected operating margins, and discount rates. These estimates and assumptions determine the amount allocated to other identifiable intangible assets and goodwill, as well as the amortization period for identifiable intangible assets with finite lives. Impairment of non-financial assets CSA Group reviews goodwill and indefinite-lived intangible assets at least annually and other non-financial assets when there is any indication that the asset might be impaired. CSA Group has estimated the value in use for any non-financial asset or cash-generating unit to which goodwill is allocated or where there is an indication of impairment. The value in use calculation is based on a discounted cash flow model, which requires assumptions about future cash flows, margins and discount rates. Refer to note 9 for more details about methods and assumptions used in these models. Employee future benefits The cost of defined benefit pension plans and other post-employment medical benefits and the present value of pension obligations are determined using actuarial valuations. An actuarial valuation involves making various assumptions. These include the determination of the discount rate, future salary increases, mortality rates, medical cost trend rate, and future pension increases. Due to the complexity of the valuation, the underlying assumptions, and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. In determining the appropriate discount rate, management considers the interest rates of corporate bonds in Canada with at least an AA rating, with extrapolated maturities corresponding to the expected duration of the defined benefit obligation. The underlying bonds are further reviewed for quality, and those having excessive credit spreads are removed from the population of bonds on which the discount rate is based, on the basis that they do not represent high quality bonds. The mortality rate is based on publicly available mortality tables for Canada. Future salary increases and pension increases are based on expected future inflation rates for Canada and on management’s best estimates. Refer to note 18 for more details on these assumptions. Allowance for doubtful accounts CSA Group must make an assessment of whether trade receivables and unbilled revenues are recoverable from clients. The allowance estimate is based on management’s best assessment of the collectibility of the accountsCSA Group Annual Report 2012 | 2013 28 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(11 ) taking into consideration client creditworthiness, current economic trends and past experience. If future collections differ from estimates, future earnings would be adjusted accordingly. Revenue recognition In determining the percentage of completion, management must estimate total contract costs to complete in order to assess the progress of the project, the estimated outcome and whether a provision is necessary to reflect anticipated contract losses. The estimates influence the timing of revenue recognition. The estimated costs to complete are determined using management’s best estimates of the outcome of projects. 

### 4 Accounting standards issued Unless otherwise noted, the following revised standards and amendments are effective for annual periods beginning on or after January 1, 2013 with earlier application permitted. During the year, the Association early adopted the following amended standards: a) IFRS 7, Financial Instruments - Disclosures. During the year ended March 31, 2013, the Association adopted the amendments to IFRS 7, Financial Instruments - Disclosures. The amendment requires additional disclosure in respect of risks arising from transferred financial assets. The adoption of the amendment had no effect on the Association’s disclosures. b) IAS 19 (REV 2011) Employee Benefits. During the year ended March 31, 2013, the Association early adopted the amendments to IAS 19. Accordingly, the Association recognizes all actuarial gains and losses and past service costs immediately, replaced interest costs and expected return on plan assets with a net interest amount that is calculated by applying the discount rate to the net defined benefit liability (asset) and added some disclosures not previously required under IAS 19. The Association has not yet assessed the impact of the following standards and amendments: a) IFRS 10, Consolidated Financial Statements, requires an entity to consolidate an investee when it has power over the investee, the entity is exposed, or has rights, to variable return from its involvement with the investee and has the ability to affect those returns through its power over the investee. Under existing IFRS, consolidation is required when an entity has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. IFRS 10 replaces SIC-12, Consolidation - Special Purposes Entities and parts of IAS 27, Consolidated and Separate Financial Statements. b) IFRS 12, Disclosure of Interests in Other Entities, establishes disclosure requirements for interests in other entities, such as subsidiaries, joint arrangements, associates, and unconsolidated structured entities. The standard carries forward existing disclosures and also introduces significant additional disclosures that address the nature of, and risks associated with, an entity’s interests in other entities. c) IFRS 13, Fair Value Measurement, is a comprehensive standard for fair value measurement and disclosure for use across all IFRS standards. The new standard clarifies that fair value is the price that would be received to sell an asset, or paid to transfer a liability in an orderly transaction between marketCSA Group Annual Report 2012 | 2013 29 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(12 ) participants, at the measurement date. Under existing IFRS, guidance on measuring and disclosing fair value is dispersed among the specific standards requiring fair value measurements and does not always reflect a clear measurement basis or consistent disclosure. d) There have been amendments to existing standards, including IAS 27, Separate Financial Statements and IAS 28, Investments in Associates and Joint Ventures. IAS 27 addresses accounting for subsidiaries, jointly controlled entities and associates in non-consolidated financial statements. IAS 28 has been amended to include joint ventures in its scope and to address the changes in IFRS 10 - 13. e) IAS 1, Presentation of Financial Statements, has been amended to require entities to separate items presented in other comprehensive income into two groups, based on whether or not items may be recycled in the future. Entities that choose to present other comprehensive income items before tax will be required to show the amount of tax related to the two groups separately. The amendment is effective for annual periods beginning on or after July 1, 2012 with earlier application permitted. f) IFRS 9, Financial Instruments, was issued in November 2009 and addresses classification and measurement of financial assets. It replaces the multiple category and measurement models in IAS 39 for debt instruments with a new mixed measurement model with only two categories: amortized cost and fair value through profit or loss. IFRS 9 also replaces the models for measuring equity instruments. Such instruments are either recognized at fair value through profit or loss or at fair value through other comprehensive income. Where equity instruments are measured at fair value through other comprehensive income, dividends are recognized in profit or loss to the extent they do not clearly represent a return of investment; however, other gains and losses (including impairments) associated with such instruments remain in accumulated comprehensive income indefinitely. This standard will be effective for the Association’s year ending March 31, 2015. Requirements of financial liabilities were added to IFRS 9 in October 2010 and they largely carried forward existing requirements in IAS 39, Financial Instruments - Recognition and Measurement, except that fair value changes due to credit risk for liabilities designated at fair value through profit and loss are generally recorded in other comprehensive income.


### 5 Short-term investments March 31, 2013 $ March 31, 2012 $ April 1, 2011 $ (Unaudited) Bonds and guaranteed in vestment certificates 14,802 47,654 35,785 Pooled funds 117,693 56,646 55,462 Equities

- 22,914 20,520 Cash and cash equivalents held by brokers

- 1,342 2,239 132,495 128,556 114,006CSA Group Annual Report 2012 | 2013 30 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(13 ) 

### 6 Trade and other receivables March 31, 2013 $ March 31, 2012 $ April 1, 2011 $ (Unaudited) Trade and other receivables 4 5 , 8 8 3 44,064 39, 848 Unbilled services 8,563 8,199 5,992 Other receivables 1,35 1 1,032 637 F oreign exchange option contracts (109) 224 681 Receivable from related party 102

- - Allowance for doubtful accounts (1,552) (1,534) (1,380) 54,238 51,98 5 45, 778 The roll forward for allowance for doubtful accounts is as follows: 2013 $ 2012 $ Opening balance 1,534 1,380 Additions to provisions 912 1,420 Amount written off (894) (1,266) 1,552 1,534 The aging analysis of trade receivables past due but not impaired is as follows: 31 to 60 days $ 61 to 90 days $ Over 90 days $ Total $ March 31, 2013 13,819 2,996 4,407 21,222 March 31, 2012 10,305 3,555 4,573 18,433 The aging analysis of the allowance for doubtful accounts is as follows: 31 to 60 days $ 61 to 90 days $ Over 90 days $ Total $ March 31, 2013 100 300 1,152 1,552 March 31, 2012 80 300 1,154 1,534CSA Group Annual Report 2012 | 2013 31 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(14 ) 

### 7 Inventories March 31, 2013 $ March 31, 2012 $ April 1, 2011 $ (Unaudite d ) Fin i shed goods for resale 561 573 657 The cost of inventories recognized as an expense and included in the consolidated statements of income was $1,527 (March 31, 2012 - $1,697). 

### 8 Property, plant, and equipment Property, plant and equipment in the consolidated statements of financial position are as follows:

Land $ Buildings $ Leaseholds $ Equipment $ Co mputer equipment $ Total $
At April 1, 2011 (U naudited) Deemed cost 9,153 27,863 1,948 20,757 1,603 61,324 Accumulated depreciation

- - (52) (848) (270 ) (1,1 70 ) Net book value 9,153 27,863 1,896 19,909 1,33 3 60,154 Year ended March 31, 2012 Opening net book value 9,153 27,863 1,896 19,909 1,333 60,154 Additions

- 557 2,267 10,504 1,51 6 14,844 Disposals

- - - (54) (100) (154) Depreciation

- (1,72 9) (431) (2, 788 ) (580) (5, 528 ) Exchange differences

- - 1 (1 41 ) 3 ( 137 ) Closing net book value 9,153 26,69 1 3,733 27,430 2,17 2 69,179 At March 31, 2012 Cost or valuation 9,153 28,420 4,215 31, 072 2,965 75,82 5 Accumulated depreciation

- (1,729) (48 2 ) (3, 64 2 ) ( 79 3 ) (6, 646 ) Net book value 9,153 26,69 1 3,73 3 27,43 0 2,17 2 69,17 9 Year ended March 31, 2013 Opening net book value 9,153 26,69 1 3,733 27,430 2,17 2 69,17 9 Additions

- 1,402 343 9,880 1,006 12,631 Disposals

- - - (44 )

- (44) Depreciation

- (1, 923 ) (669) (3, 91 2) (698) (7, 202 ) Exchange differences

- - - (78) ( 7 ) (8 5 ) Closing net book value 9,153 26,17 0 3,407 33,27 6 2,473 74,479 At March 31, 201 3 Cost or valuation 9,153 29, 686 4,55 8 40,599 3,953 87,94 9 Accumulated depreciation

- (3,5 16 ) (1,15 1 ) (7 , 323 ) (1, 480 ) (13, 47 0 ) Closing net book value 9,153 26,17 0 3,40 7 33,27 6 2,473 74,479CSA Group Annual Report 2012 | 2013 32 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(15 ) Included in equipment at March 31, 2013 was an amount of $4,024 (March 31, 2012 - $1,461; April 1, 2011 - $207) relating to an expenditure for plant equipment in the course of construction. These assets under construction relate to various projects for renovations, and building of new laboratory equipment. No depreciation was provided on these assets since they were not available-for-use. 

### 9 Intangible assets and goodwill Intangible assets and goodwill in the consolidated statements of financial position were as follows:
Customer lists $ Computer software $ Other $ Accreditation agreements $ Total intangibles $ Goodwill $
At April 1, 2011 (U naudited) Openi ng net book value 1,368 2,162 1,766 7,045 12,341 4,188 Accumulated amortization (160)

- (713)

- (873)

- Net book value 1,208 2,162 1,053 7,045 11,468 4,188 Year ended March 31, 2012 Opening net book value 1,208 2,162 1,053 7,045 11,468 4,188 Additions 8,302 2,289 429 1,698 12,718 8,484 Amortization (2 74 ) (55 8 ) (435 )

- (1,267)

- Exchange differences (2 57 )

- 69 50 ( 138 ) (238) Closing net book value 8,97 9 3,89 3 1,116 8,793 22,78 1 12,434 Year ended March 31, 201 3 Opening net book value 8,97 9 3,89 3 1,116 8,793 22,781 12,434 Additions 1,290 1,621 139

- 3,050 3,481 Amortization (4 71 ) (5 00 ) (414)

- (1,3 85 )

- E xchange differences (2 13 )

- (26) (270) (5 09 ) (312) Closing net book value 9,5 85 5,0 14 815 8,523 23,937 15,603 Included in intangible assets as at March 31, 2013 was an amount of $292 (March 31, 2012 - $457; April 1, 2011 - $856) relating to expenditure for computer software in the course of construction. These intangible assets are not being amortized as they were not available-for-use. Goodwill has been allocated to the following CGUs: March 31, 2013 $ March 31, 2012 $ April 1, 2011 $ (Unaudited) Sira g roup of companies 4,112 4,249 4,188 MTP/emitel group of companies 7,647 7,812

- Other companies 3,844 373

- 15,603 12,434 4,188CSA Group Annual Report 2012 | 2013 33 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(16 ) In assessing the intangible assets and goodwill for impairment at March 31, 2013, March 31, 2012, and April 1, 2011, CSA Group compared the aggregate recoverable amount of the assets included in the above CGUs to their respective carrying amounts. Recoverable amounts for CGUs tested have been determined based on the value in the use of the CGUs using discounted cash flow projections approved by management. Key assumptions included the following: March 31, 2013 March 31, 2012 April 1, 2011 (Unaudited) Sira MTP/ emitel Sira Sira Average growth rate

- < 5 years 8.3% 7.1% 8.5% 9.0% Average growth rate

- > 5 years 2

. 0 % 2

. 0 % 2 .0% 2.0% Discount rate 7.5% 7.5% 7.5% 7.5% The above impairment tests resulted in no impairment at March 31, 2013, March 31, 2012 and April 1, 2011.



### 10 Investment in associate The following summarizes the Association’s 37.5% share of assets, liabilities, revenues and profit or loss of CFV Solar Test Laboratory Inc., a US company: March 31, 2013 $ March 31, 2012 $ April 1, 2011 $ (Unaudited) Assets 1,124 1,481 1,078 Liabilities 68 59 43 Revenues 289 301

- Loss (366) (328)

-CSA Group Annual Report 2012 | 2013 34 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(17) 

### 11 Business combinations On November 15, 2012, a subsidiary of the Association acquired 100% of the assets and liabilities of Orb Optronix, Inc. (Orb) for $5,540 cash. Orb is a light emitting diode (LED) test, measurement and engineering services company based in the State of Washington, with an LED test lab capability and a skilled work force. A summary of the fair value of assets acquired and liabilities assumed at the date of acquisition is approximately as follows: $ Current assets and liabilities 53 Property, plant and equipment 508 Intangible assets Customer relationship s 1,290 Other 208 Goodwill 3,481 Total assets acquired

- net 5,540 CSA Group incurred acquisition costs of $266, which have been expensed in the consolidated statements of income. For the period from November 15, 2012 to March 31, 2013, the operations of Orb have been integrated into the other US operations of CSA Group and therefore separate revenues and income cannot be determined. An estimate of Orb’s revenue and income for the period from April 1, 2012 to November 15, 2012 cannot be determined and is not considered significant to these consolidated financial statements. On April 5, 2011, the Association through its subsidiary, CSA Certification UK Limited, acquired 100% of the common shares of INTRATEST GmbH (subsequently renamed CSA Group Switzerland GmbH), based in Switzerland, for cash consideration of $1,385. On October 21, 2011, the Association through its subsidiary, CSA Europe GmbH, acquired 100% of the common shares of Mikes-Testing Partners GmbH (MTP) and emitel AG (emitel) based in Strasskirchen, Germany, for cash consideration of $22,344. MTP holds 90% interests in two subsidiaries: MTP Japan and International Certification Management GmbH (ICM). emitel holds a 95% interest in emitel Turkey and a 51% interest in emitel Hong Kong. CSA Group incurred acquisition costs of $874, which have been expensed in the consolidated statements of income. For the period from acquisition to March 31, 2012, revenues of $7,681 and income of $868 was recorded by CSA Group. If the Association had owned these companies for the period from April 1, 2011 to March 31, 2012, CSA Group’s revenues and net income would have been $17,147 and $2,012 higher, respectively.CSA Group Annual Report 2012 | 2013 35 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(18 ) A summary of the fair value of assets acquired and liabilities assumed at the date of the acquisitions is as follows: $ Current assets and liabilities

- net of cash acquired 2,125 Property, plant and equipment 3,182 Other assets and liabilities

- net (492) Intangible assets Accreditation agreements 1,698 Customer relationships 8,302 Other 431 Goodwill 8,483 Total assets acquired

- net 23,729


### 12 Bank loan In 2011, the Association and its subsidiaries entered into a €16,000 non-revolving reducing term loan with its principal banker to assist in the acquisition of strategic companies. Quarterly repayments of €500 are required over the eight-year term of the loan. Interest is charged at the rate of Euribor plus an agreed margin. The loan is secured by a general security agreement and a first charge on the Association’s head office building located in Toronto, Canada. The Association is in compliance with all its loan covenants as at March 31, 2013 and March 31, 2012. The main covenant with the lender is to maintain a fixed charge coverage of not less than 1.50:1. The fair value of the long-term debt equals its carrying amount, as the impact of discounting is not significant. 

### 13 Finance income 2013 $ 2012 $ Interest income 561 1,063 Net foreign exchange gains 235 852 Fair value gain on financial assets and liabilities 8,438 1,226 9,234 3,141 

### 14 Finance costs 2013 $ 2012 $ Interest on borrowings 437 276 Interest on finance leases 26 16 463 292CSA Group Annual Report 2012 | 2013 36 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(19 ) 

### 15 Fair values The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, based on point-in-time estimates that may change in subsequent reporting periods due to market conditions or other factors. Because of short-term maturities and variable interest rates, the fair value of the financial assets and liabilities (except those measured at fair value) approximates carrying value. Fair value hierarchy The Association uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

 Level 1 - quoted (unadjusted) prices in active markets for identical assets or liabilities;

 Level 2 - inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices); and

 Level 3 - inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs). March 31, 2013 Level 1 $ Level 2 $ Level 3 $ Total $ Short

-term investments 14,802 117,693

- 132,495 F oreign exchange option contracts

- 107

- 107 14,802 117,800

- 132,602 March 31, 2012 Level 1 $ Level 2 $ Level 3 $ Total $ Short

-term investments 71,910 56,646

- 128,556 Foreign exchange option contracts

- 224

- 224 71,910 56,870

- 128,780CSA Group Annual Report 2012 | 2013 37 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(20 ) April 1, 2011 Level 1 $ Level 2 $ Level 3 $ Total $ (Unaudited) Short

-term investments 5 8 ,544 55,462

- 11 4 , 006 Foreign exchange option contracts

- 1,038

- 1,038 5 8 ,544 56,500

- 11 5 , 044 

### 16 Trade and other payables March 31, 2013 $ March 31, 2012 $ April 1, 2011 $ (Unaudited) Trade payables 15,427 16,244 9,786 Accrued expenses 27,921 23,860 23,603 43,348 40,104 33,389 

### 17 Net change in non-cash working capital balances 2013 $ 2012 $ Trade and other receivable s ( 1 , 717 ) (3,984 ) Inventories 83 893 Prepaid expenses (1,462) (915) Trade and other payables 3,462 3, 313 Deferred revenue 2,853 4,324 Customer deposits 666 595 Provisions (134) (140) 3,751 4, 086 Supplemental cash flow information Income taxes paid 1,046 865 (Decrease) increase in derivat ive assets included in accounts receivable 333 (814) 

### 18 Employee future benefits The Association sponsors various post-employment benefit plans as follows: defined contribution pension plans, defined benefit pension plans, and plans that provide extended health-care coverage to employees. Defined benefit pension benefits are based on length of service and final average earnings. Pension payments for all defined benefit plans, except one, are partially indexed to cost of living increases after retirement.CSA Group Annual Report 2012 | 2013 38 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(21 ) During the year, the Association elected to fund all pension plans. This required an initial contribution of $6,324 for the one plan that was not funded previously. The amounts recognized in the consolidated statements of financial position and consolidated statements of income are as follows: March 31, 2013 $ March 31, 2012 $ April 1, 2011 $ (Unaudited) Consolidated statements of financial position Accrued pension benefit asset 3,63 9 4,311 5,263 Future employee benefit liability 53,182 43,752 35,494 Consolidated statements of income and comprehensive income Defined benefit pension plans 13,410 8 ,117

- Defined contribution pension plans 1,003 843

- Future employee benefit plans 10,657 9,473

- The amounts recognized in the consolidated statements of financial position are determined as follows: March 31, 2013 March 31, 2012 April 1, 2011 (Unaudited) Defined benefit pension plans $ Other benefit

plans $ Defined benefit pension plans $ Other benefit

plans $ Defined benefit pension plans $ Other benefit

plans $ Present value of obligations (275,385) (53,182) (238,602) (43,752) (203,853) (35,494) Fair value of plan assets 286,377

- 258,9 59

- 260,076

- Effect of pension asset limit (7,35 3 )

- (16,04 6 )

- (50,960)

- 3,63 9 (53,182) 4,311 (43,752) 5,263 (35,494)CSA Group Annual Report 2012 | 2013 39 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(22 ) The movement in the accrued pension benefit asset (employee future benefits liability) over the year is as follows: 2013 2012 Defined benefit pension plans $ Other benefit

plans $ Defined benefit pension plans $ Other benefit

plans $ As at April 1 4,31 1 (43,75 2 ) 5,263 ( 35,494 ) Current service cost (6,620 ) (2,803 ) (6,23 5 ) (2,239 ) Interest cost 418 (2,157 ) 585 (2,026 ) Employee contributions 12,738

- 7,164

- Remeasurements Return on plan assets (excluding interest income) 11,225

- (16 ,416)

- Effect of changes In financial assumptions (26,999) (5,692) (23,847) (5,058) From experience adjustments (926) (5)

- (150) Benefits paid

- 1,227

- 1 , 2 15 Past

-service costs

- - (56)

- Effect of pension asset limit (excluding interest) 9,492

- 37,853

- As at March 31 3,63 9 ( 53,182 ) 4,31 1 (43,752) The movement in the fair value of the plan assets over the year is as follows: Defined benefit pension plans 2013 $ 2012 $ As at April 1 258,959 260,076 Interest income 12,762 15,056 Remeasurements Return on plan assets (excluding interest income) 11,561 (16,416) Employer contributions 12,738 7 ,164 Employee contributions 1,927 2,125 Benefits paid (10,664) (8,205) Administration expenses (906) (841) As at March 31 286,377 258,959CSA Group Annual Report 2012 | 2013 40 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(23 ) The amounts recognized in the consolidated statements of income are as follows: 2013 2012 Defined benefit pension plans $ Other benefit

plans $ Defined benefit pension plans $ Other benefit

plans $ Current service cost 6,620 2,803 6,236 2,239 Interest cost (418) 2,157 (585) 2,026 Past

-service cost

- - 56

- As at March 31 6,202 4,960 5,707 4,265 The amounts recognized in the consolidated statements of comprehensive income are as follows: 2013 2012 Defined benefit pension plans $ Other benefit

plans $ Defined benefit pension plans $ Other benefit

plans $ Actuarial loss 16,700 5,697 40,263 5,208 Li mit on pension asset (9,492)

- (37,853)

- 7,208 5,697 2,410 5,208 The principal actuarial assumptions used were as follows: 2013 2012 Defined benefit pension plans % Other benefit

plans % Defined benefit pension plans % Other benefit

plans % Discount rate 4.29 4.30 4.99 5. 0 0 Inflation rate 2.20 n/a 2.20 n/a Future salary increases 3.50 3.50 3.50 3 .50 Initial health

- care cost trend rate

- 4.50

- 4.50 Mortality table used: UP94 generationalCSA Group Annual Report 2012 | 2013 41 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(24 ) Defined benefit plan assets comprise the following: March 31, 2013 % March 31, 2012 % April 1, 2011 % (Unaudited) Equity instruments 68.0 66.0 69.0 Debt instruments 29.0 30.0 28.0 Cash and cash equivalents 3.0 4.0 3.0 10 0.0 100.0 100.0 The Association’s risk management program seeks to minimize adverse effects of risk on the defined benefit plan assets. Defined benefit plan assets are well diversified, such that the failure of any single investment would not have a material impact on the overall value of assets. Expected employer contributions for the year ending March 31, 2014 are $6,394 for the defined benefit pension plans and $1,320 for the other benefit plans. The effect of a 1% change in the health-care cost trend rate on the employee future benefit liability is as follows: Increase $ Decrease $ Effect on the aggregate of the current service cost and interest cost 1,161 (900) Effect on the defined benefit obligation 10,517 (8,363) The effect of a 0.25% change in the composite discount rate for all pension plans would increase or decrease the defined benefit obligation by $10,167 or $(9,622), respectively. The effect of a 0.20% increase in the pension growth rate for all pension plans would increase the defined benefit obligation by $1,937. Next actuarial valuation date Last actuarial valuation date Defined benefit pension plans Salaried employees December 31, 2013 December 31, 2010 Members of Local 967 of the Canadia n Union of Public Employees December 31, 2013 December 31, 2010 Members of Local 4559 of the Canadian Union of Public Employees December 31, 2013 December 31, 2010 Designated executive employees December 31, 2013 December 31, 2010CSA Group Annual Report 2012 | 2013 42 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(25 ) 

### 19 Related party disclosures There are no related party transactions except for a US$100 secured loan to an associated company. The consolidated financial statements include the financial statements of the Association, its subsidiaries and an associate company. The major operating entities are: % Ownership Incorporation country Functional currency March 31, 2013 % March 31, 2012 % April 1, 2011 % (Unaudited) Canadian Standards Association Canada CAD CSA America, Inc. United States CAD 100.0 100.0 100.0 OnSpeX, Inc. United States CAD 100.0 100.0 100.0 CFV Solar Test Laboratory, Inc. United States US D 37.5 37.5 37.5 Canadian Standards Association de Mexico S.A. de C.V. Mexico CAD 100.0 100.0 100.0 CSA Servicios, S.A. de C.V. Mexico CAD 100.0 100.0 100.0 CSA India Private Limited India CAD 100.0 100.0 100.0 Canadian Standards Association (F ar East Operations) Ltd. Hong Kong CAD 100.0 100.0 100.0 OnSpeX Shanghai Co., Ltd. China CAD 100.0 100.0 100.0 CCIC

- CSA International Certification Co., Ltd. China CAD 67.5 67.5 67.5 CSA Certification UK Ltd. United Kingdom British pound 100.0 100.0 100.0 Sira Consulting Limited United Kingdom British pound 100.0 100.0 100.0 Sira Test and Certification Limited United Kingdom British pound 100.0 100.0 100.0 Sira Environmental Limited United Kingdom Brit ish pound 100.0 100.0 100.0 Sira Certification Service United Kingdom British pound 100.0 100.0 100.0 CSA Group Capital UK Limited United Kingdom British pound 100.0 100.0 100.0 CSA Group Switzerland GmbH Switzerland Swiss franc 100.0 100.0 n/a CSA Group Europe GmbH Germany euro 100.0 100.0 n/a CSA Group Italy S.r.l. Germany euro 100.0 n/a n/a mikes

-testing partners GmbH Germany euro 100.0 100.0 n/a emitel GmbH Germany euro 100.0 100.0 n/a Executive management compensation Aggregate compensation paid to executives of CSA Group who have the authority and responsibility for planning, directing and controlling the activities of CSA Group was $4,500 (2012 -$4,700).



### 20 Financial risk management objectives and policies CSA Group’s activities are exposed to a variety of financial risks: market risk (including interest rate risk, foreign currency risk and other price risk), credit risk and liquidity risk. The Association’s overall risk management program seeks to minimize potential adverse effects of risk on CSA Group’s financial performance.CSA Group Annual Report 2012 | 2013 43 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(26 ) Market risk Market risk is the risk the fair value of future cash flows of a financial instrument will fluctuate due to changes in market conditions. The market is comprised of several types of risk: interest rate risk, foreign currency risk and other price risk.

 Interest rate risk Interest rate risk refers to the effect on the fair value or future cash flows of an investment due to fluctuations in interest rates. CSA Group’s variable interest bank loan is exposed to interest rate risk. CSA Group is not exposed to significant interest rate risk on its other monetary current assets and current liabilities due to their short-term maturities. During the year ended March 31, 2013, all short-term investments in bonds were converted into pooled funds, thereby reducing interest rate risk. CSA Group invests surplus cash in bank deposits and short-term money market securities which, due to their short-term nature, do not expose the Association to significant interest rate risks.

 Interest rate sensitivity The following table demonstrates the sensitivity to a reasonably possible change in interest rates on the bank loan. With all other variables held constant, the Association’s consolidated statements of income are affected through the impact on bank interest as follows.

Increase/ decrease % Effect on net income and net assets $ March 31, 2013 Variable interest rate +1 (178) Variable interest rate

- 1 178 March 31, 2012 Variable interest rate +1 ( 96 ) Variable interest rate

- 1 96 The assumed movement in basis points for interest rate sensitivity analysis is based on the currently observable market environment.

 Foreign currency risk Foreign currency risk is the risk the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. Exposure to the risk of changes in foreign exchange rates relates primarily to CSA Group’s operating activities, when revenue or expenses are denominated in a different currency from the Association’s functional currency. CSA Group operates globally with significant revenue and expenses denominated mainly in US dollars. This gives rise to the risk that some of its revenue and cash flows may be impacted by fluctuations in foreign exchange rates between the US dollar and the Canadian dollar. CSA Group uses derivative financial instruments as part of its overall riskCSA Group Annual Report 2012 | 2013 44 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(27) management policy to manage exposures to foreign exchange risk that result from operations. As at March 31, 2013, the consolidated statement of financial position includes amounts denominated in US currency, which represents 12% (2012 - 20%) of current assets and 14% (2012 - 14%) of current liabilities. As at March 31, 2013, the Association had outstanding forward foreign exchange contracts for a notional amount of US$31,500 (2012 - US$41,100) that effectively converts US$31,500 (2012 - US$41,100) of its anticipated US dollar revenue over the next nine months into Canadian dollars within fixed ranges of conversion rates from $0.98 to $1.06 (2012 - $0.96 to $1.08), thus reducing the impact of exchange rate fluctuations on future US dollar denominated cash inflows. The fair value of these forward foreign exchange contracts amounts to an unrealized loss of $109 as at March 31, 2013 and an unrealized gain of $224 as at March 31, 2012.

 Foreign currency sensitivity The following table demonstrates the sensitivity to a reasonably possible change in the foreign exchange rates of the US dollar, with all other variables held constant, of CSA Group’s net income (due to changes in the fair value of monetary assets and liabilities including non-designated foreign currency derivatives) and the Association’s net assets. CSA Group’s exposure to other foreign currencies is not material.

Increase/ decrease % Effect on net income and net assets $ March 31, 2013 Change in US dollar exchange rate +5 615 Change in US dollar exchange rate

- 5 (615) March 31, 2012 Change in US dollar exchange rate +5 1,401 Change in US dollar exchange rate

- 5 (1,401) The movement in the effect on income and net assets is a result of a change in the fair value of derivative financial instruments and monetary assets and liabilities denominated in foreign currencies.

 Other price risk CSA Group has exposure to price risk from short-term investments that are invested in pooled funds. Price risk is the risk the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market. During the year ended March 31, 2013, all short-term investments in equities were sold and the proceeds reinvested in pooled funds, thereby eliminating price risk related to individual investments owned by the Association.CSA Group Annual Report 2012 | 2013 45 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(28 ) Price risk exposure relates to pooled funds and equities whose unit values will fluctuate as a result of changes in market prices, principally investment securities. Increase/ decrease in market prices % Effect on net income and net assets $ March 31, 2013 Change in unit price +5 5,884 Change in unit price

- 5 (5,884) March 31, 2012 Change in unit price +5 2,832 Change in unit price

- 5 (2,832) Credit risk Credit risk on financial instruments is the risk of financial loss occurring as a result of default or insolvency of a customer or counterparty on its obligations to CSA Group. For CSA Group, credit risk arises from cash and cash equivalents on deposit with banks, short-term investments with investment management companies and credit exposure to customers. Credit risk from balances with banks and financial institutions is managed in accordance with the Association’s policy. Derivative transactions are executed only with approved banks. Credit risk for short-term investments is managed by dealing only with counterparties that have a minimum investment rating of A as determined by a recognized rating agency and by regular monitoring. CSA Group monitors and manages its concentration of counterparty risk on an ongoing basis. Counterparty credit limits are reviewed by the Association’s Board of Directors on an annual basis, and may be updated throughout the year subject to the approval of the Association’s Finance, Audit and Risk Committee. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through potential counterparty failure. The carrying values of these instruments represent the maximum credit risk exposure at the consolidated financial statements date. Trade receivable credit risk is mitigated through established credit monitoring activities. These include conducting financial and other assessments to establish and monitor a customer’s creditworthiness, setting customer limits, monitoring exposure against these limits, and in some instances moving the customer to cash-in-advance terms. The requirement for an impairment is analyzed throughout the year on an individual basis for major clients. The calculation is based on actually incurred historical data. Liquidity risk Liquidity risk is the risk of being unable to settle or meet commitments as they come due. Liquidity risk is managed firstly by keeping operational funds separate from investment funds in accordance with the Association’s Statement of Investment Policies and Procedures. Secondly, liquidity risk is further managed by ensuring CSA Group invests in high quality investments easily disposed of in an active market.CSA Group Annual Report 2012 | 2013 46 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(29 ) The following table summarizes the amount of contractual undiscounted future cash flow requirements for financial instruments as at March 31, 2013: March 31, 2013 Less than 3 months $ 3 months to 1 year $ 1 year to 5 years $ Total $ Contractual obligations Bank loan 65 1 1,954 15,175 17,780 Finance leases 52 156 400 608 Trade and other payables 46,119

- - 46,119 Provisions 3 5 105 525 665 46,857 2,215 16,100 65,172 March 31, 2012 Less than 3 months $ 3 months to 1 year $ 1 year to 5 years $ Total $ Contractual obligations Bank loan 665 1,996 18,297 20,958 Finance leases 42 129 518 689 Trade and other payables 40,104

- - 40,104 Prov isions 3 5 10 5 560 700 40,846 2,230 19,375 62,451 Capital management The Association’s objectives when managing capital are to safeguard CSA Group’s mission of providing a better, safer and more sustainable environment where standards work for people and business. The capital resources are managed to seek growth through development and expansion of existing assets and programs and to ensure the financial covenants related to its bank loan are met. The Association considers net assets and debt as its capital structure and through the Board of Directors has developed several internal requirements to review and monitor this metric. The overall objectives for managing capital are unchanged from the previous year.CSA Group Annual Report 2012 | 2013 47 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(30 ) 

### 21 Contingencies, commitments and guarantees Operating lease commitments The Association has entered into operating leases, as the lessee, requiring rental payments as follows: 2013 $ 2012 $ Within one year 6,318 5,889 After one year but not more than five years 24,264 22,138 More than five years 10,716 12,623 41,298 40,650 Capital commitments CSA Group has capital commitments requiring payments as follows: 2013 $ 2012 $ Within one year 3,000 2,000 After one year but not more than five years

- - More than five years

- - 3,000 2,000 At March 31, 2013, CSA Group had commitments of $3,000 (2012 - $2,000) relating to the purchase and installation of laboratory and test equipment and building improvements. Litigation and contingent liabilities CSA Group has been named in a number of legal actions in the normal course of operations. In the opinion of management and legal counsel, the outcome of these actions cannot be determined with a reasonable degree of assurance at this time. CSA Group carries insurance for such actions, and any loss, to the extent that it is not fully covered by these insurance policies, is charged to operations in the period in which the liability is determined.
Guarantees In accordance with the terms of a lease agreement, the Association has guaranteed the future lease commitment to a lessor with respect to a lease assigned to the purchaser of the QMI division. The lease commitment at March 31, 2013 amounts to $2,942 (March 31, 2012 - $3,312; April 1, 2011 - $3,440) and expires in 2020. The fair value of the guarantee is not determinable.CSA Group Annual Report 2012 | 2013 48 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(31 ) 

### 22 Reconciliation of Canadian GAAP to IFRS The Association’s consolidated financial statements for the year ended March 31, 2013 are the first consolidated financial statements to be prepared in accordance with IFRS. The Association applied IFRS 1, First-time Adoption of International Financial Reporting Standards, in preparation of these consolidated financial statements. The consolidated financial statements have been prepared as described in note 2. The Association’s date of transition to IFRS is April 1, 2011. The Association prepared its opening IFRS consolidated statement of financial position at that date. The date of IFRS adoption by the Association is April 1, 2012. The Association has applied the following optional exemptions to full retrospective application of IFRS 1. Business combinations The Association has elected to apply the exemption under IFRS 1 and to not apply IFRS 3 retrospectively to all business combinations that occurred prior to the date of transition to IFRS. The application of this exemption did not have any impact on the consolidated financial statements.
Leases The Association has elected to apply the exemption under IFRS 1 to assess whether an arrangement existing at the date of transition to IFRS contains a lease on the basis of facts and circumstances existing at that date of conversion, rather than retrospectively assessing each agreement as at the date of its inception. The application of this exemption did not have any impact on the consolidated financial statements. Post-employment benefit obligations (note 22(c)) CSA Group has elected to recognize all cumulative actuarial gains and losses as at April 1, 2011 within the opening net assets for CSA Group’s employee benefit plans. Property, plant and equipment (note 22(b)) The Association has elected to apply the exemption under IFRS 1 to fair value substantially all items of property, plant and equipment and use the fair value as the deemed cost of the items of property, plant and equipment as at April 1, 2011. Cumulative translation adjustment The Association has elected to reset the cumulative translation adjustment account, which includes gains and losses arising from the translation of foreign operations, to zero at the date of transition to IFRS (note 22(e)).CSA Group Annual Report 2012 | 2013 49 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(32 ) The Association has applied the following mandatory exemptions to the full retrospective application of IFRS: Estimates Estimates under IFRS are consistent with those made under Canadian GAAP. Hindsight was not used to create or revise estimates. Hedge accounting CSA has elected to apply the exemption under IFRS 1 to redesignate the foreign exchange option contracts as at fair value through the consolidated statement of income. Hedge accounting can only be applied prospectively from the transition date to transactions that satisfy the hedge accounting criteria under IAS 39, Financial Instruments - Recognition and Measurement. Hedging relationships cannot be designated retrospectively and the supporting documentation cannot be recreated retrospectively. The Association applied hedge accounting under Canadian GAAP but has elected not to apply hedge accounting under IFRS. Reconciliation between IFRS and Canadian GAAP The following reconciliations demonstrate the impact of the transition to IFRS:

 reconciliation of net assets as previously reported under Canadian GAAP to IFRS; and

 reconciliation of consolidated statements of income as previously reported under Canadian GAAP to IFRS.

Note GAAP 2011 $ April 1, 2011 adjustments $ IFRS 2011 $ (Unaudited) 

### Assets Current assets Cash and cash equivalents 14,205

- 14,205 Trade and other receivables a 40,660 5,118 45,778 Inventories a 2,902 (2,245) 657 Prepaid expenses 4,489

- 4,489 Short

-term investments 114,006

- 114 ,006 176,262 2,873 179,135

Non -current assets Property, plant and equipment

- net b 50,492 9,662 60,154 Accrued pension benefit asset c 67,629 (62,366) 5,263 Other investment 1,035

- 1 ,035 Intangible assets d, e 11,176 292 11,468 Goodwill e 5,080 (892) 4,188 311,674 (50,431) 261,243CSA Group Annual Report 2012 | 2013 50 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(33 ) Note GAAP 2011 $ April 1, 2011 adjustments $ IFRS 2011 $ (Unaudited) 

### Liabilities Current liabilities Trade and other payables 32,671 71 8 33,389 Deferred revenue 30,901

- 30,901 Customer deposits 12,009

- 12,009 Provisions f

- 2,106 2,106 75,581 2,824 78,405 Non -current liabilities Accrued other retirement and post

-employment benefits c 34,076 1,418 35,494 Deferred gain on disposal of building g 5,261 (5,261)

- Lease inducement obligation 172

- 172 115,090 (1,019) 114,071 

### Net Assets Invested in property, plant and equipment b 50,492 9,662 60,154 Internally reserved for specific purpose s c, d, e, g, h 129,567 (59,123) 70,444 Unreserved a, f 14,402 (308) 14,094 194,461 (49,769) 144,692 Non

- controlling interest 2,123

- 2,123 Other comprehensive income h

- 357 357 196,584 (49,412) 147,172 311,674 (50,431) 261,243

Note GAAP 2012 $ March 31, 2012 adjustments $ IFRS 2012 $ 

### Assets Current assets Cash and cash equivalents 15,806

- 15,806 Trade and other receivables a 44,689 7,296 51,985 Inventories a 4,062 (3,489) 573 Prepaid expenses 5,657

- 5,657 Short

-term investments 128,556

- 128,556 198,770 3,807 202,577 Non -current assets Property, plant and equipment

- net b 57,176 12,003 69,179 Accrued pension benefit asset c 78,127 (73,816) 4,311 Other investment 1,422

- 1,422 Intangible assets d, e 23,703 (922) 22,781 Goodwill e 13,564 (1,130) 12,434 372,762 (60,058) 312,704CSA Group Annual Report 2012 | 2013 51 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(34 ) Note GAAP 2012 $ March 31, 2012 adjustments $ IFRS 2012 $


### Liabilities Current liabilities Trade and other payables 40,104

- 40,104 Deferred revenue 35,225

- 35,225 Customer deposits 12,627

- 12,627 Provisions f

- 1,966 1,966 Finance leases - 142 142 Bank loan 2,998

- 2,998 90,954 2,108 93,062 Non -current liabilities Accrued other retirement and post

-employment benefits c 38,212 5,540 43,752 Deferred gain on disposal of building g 4,552 (4,552)

- Finance leases - 547 547 Lease inducement obligation 146

- 146 Bank loan 17,960

- 17,960 151,824 3,643 155,467 

### Net Assets Invested in property, plant and equipment b 57,176 12,003 69,179 Internally reserved for specific purpose s c, d, e, g, h 147,279 (59,123) 88,156 Unreserved a, f 13,731 (9,059) 4,672 218,186 (56,179) 162,007 Non

- controlling interest 2,752

- 2,752 Oth er comprehensive income c, h

- (7,522) (7,522) 220,938 (63,701) 157,237 372,762 (60,058) 312,704CSA Group Annual Report 2012 | 2013 52 Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(35 ) Reconciliation of consolidated statements of income as previously reported under Canadian GAAP to IFRS

GAAP accounts Notes GAAP 2012

$ IFRS reclassifications $ IFRS adjustments $ IFRS 2012

$ IFRS accounts Revenue a, h 237,771

- 762 238,5 3 3 Revenue Expenses Operating expenses Direct 102,449 (102,449)

- - Selling, general and administrative 104,153 (104,153)

- - Depreciation b 7,243

- (1,715) 5,528 Depreciation Amortization of intangible assets d, e 1,001

- 2 6 6 1,267 Amortization of intangible assets a, c - 12 5 , 178 8,833 134,011 Salaries and b enefits

- 27,459

- 27,459 Professional, agency and consulting fees

- 15,682

- 15,682 Travel f

- 10,807 (140) 10,6 6 7 Property related costs

- 6,846

- 6,846 Sales, marketing and communication

- 4,970

- 4,970 Office, laboratory and computer

- 4,187

- 4,187 Material costs

- 11,473 (21) 11,4 52 Other operating expenses 214,846

- 7,223 222,069 Income from operations 22,925

- (6,461) 16,4 64 Income from operations Non -operating income (expense) Non -operating income (expense) Investment income h 1,910 941 290 3,141 Finance income Foreign exchange gain (loss) 941 (941)

- - Equity income (loss)

- - (328) (328) Share of loss in associates Foreign income taxes (1,041)

- - (1,041) Foreign income taxes Bank interest (276)

- (16) (292) Finance costs Amortization of gain on sale of building 709

- (709)

- Excess of revenue over expenses for the year 25,168

- (7,224) 17,944 Net income for the year Attributable to Net income attributable to The Association 24,539 17,315 The Association Non

- controlling interest 629 629 Non

- controlling interest 25,168 17,944CSA Group Annual Report 2012 | 2013 53 Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(36 ) GAAP accounts Notes GAAP 2012

$ IFRS reclassifications $ IFRS adjustments $ IFRS 2012

$ IFRS accounts C omprehensive income
e 96 96 Exchange differences on trans lation of net assets of foreign operations h (357) (357) Gains and losses on derivatives designated as cash flow hedges in prior years c (7,618) (7,618) Actuarial loss on employee future benefits (7,879) (7,879) 10,065 Total comprehensive income for the year a) Revenue recognition Canadian GAAP allowed revenue to be recorded on a percentage of completion or a completed contract basis. IFRS does not allow the completedcontract method utilized under Canadian GAAP. Under IFRS, revenue is now recognized using the percentage of completion method. As a result, workin-progress was eliminated and trade and other receivables were increased for unbilled revenue as at April 1, 2011 and as at March 31, 2012 by $2,245 and $5,118 and by $3,489 and $7,296, respectively, with an offsetting adjustment to net assets as at April 1, 2011 and to revenue and salaries and benefits in the consolidated statement of income for the year ended March 31, 2012. b) Property, plant and equipment As a result of the fair value option exemption mentioned earlier, the net book value under IFRS increased as compared to Canadian GAAP. Accordingly, the Association incurred a one-time adjustment of $9,662, primarily to property, with an offsetting adjustment to net assets as at April 1, 2011. To reflect the difference in the depreciation of these assets, an adjustment to reduce depreciation by $1,715 was required for the year ended March 31, 2012.CSA Group Annual Report 2012 | 2013 54 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(37) c) Employee benefits The Association elected to recognize all cumulative unamortized actuarial gains and losses on transition in its opening net assets on April 1, 2011, resulting in an opening adjustment of ($11,403). Previously under Canadian GAAP, the corridor method was used and these items were amortized into the consolidated statements of income over time. IFRS also contains specific guidance over when an asset relating to a pension plan can be recognized, including the entity’s legal ability to access the surplus. As a result, the previously established surplus under Canadian GAAP was revised to amounts calculated in accordance with applicable IFRS standards. This resulted in an adjustment of ($49,927) to opening net assets. As a result of timing differences in measuring the funded status of benefits, the Association recorded an additional adjustment of ($2,454) to opening net assets. These adjustments reduced the accrued pension benefit asset and increased the accrued other retirement and post-employment benefit liability by $62,366 and $1,418, respectively. Due to different discount rates caused by changing the measurement date from December 31 to March 31 and the different treatment of plan asset returns and pension asset limits, the Association recorded an additional expense of $15,572 in the consolidated statements of comprehensive income as previously calculated and recorded under Canadian GAAP for the year ended March 31, 2012. d) Intangible assets Under Canadian GAAP and not-for profit accounting, the Association was not required to capitalize certain internally developed intangible assets. Under IFRS, the Association can capitalize internally developed intangible assets if they meet the requirements under IAS 38. As a result, the Association has capitalized an additional $2,162 of computer software costs as at April 1, 2011 with a corresponding adjustment to net assets. For the year ended March 31, 2012, additional amortization of intangible assets of $266 was recorded. e) Change in functional currency of subsidiaries IFRS requires that assets and liabilities of entities that have a different functional currency to the Association be translated at the closing rate of the consolidated statement of financial position. Under Canadian GAAP, all foreign operations were considered integrated and translated using the temporal method. Under IFRS this method is not permitted and the Association has determined that the functional currency of certain foreign subsidiaries is not the Canadian dollar. For those subsidiaries, foreign exchange gains and losses on consolidation are now recognized in accumulated other comprehensive income. As such, the Association has adjusted the translated amount of its intangibles, accumulated amortization and goodwill by ($2,272), $402 and ($892), respectively, with a corresponding offset to net assets.CSA Group Annual Report 2012 | 2013 55 

## Canadian Standards Association Notes to Consolidated Financial Statements March 31, 2013 and March 31, 2012 (in thousands of Canadian dollars)

(38) f) Provisions IFRS requires provisions to be disclosed separately on the face of the consolidated financial statements. The Association identified an onerous rental contract as at April 1, 2011 and accordingly recorded a provision of $968. Under IFRS, the Association is required to record a provision for its accumulating sick leave programs, which was not specifically required under Canadian GAAP. The Association has recalculated the provision and accordingly recorded a liability of $1,138 as at April 1, 2011. For the year ended March 31, 2012, the liability for the onerous contract was reduced by $140 with a corresponding decrease in property related costs in the consolidated statements of income. There was no change necessary in the provision for sick leave for the year ended March 31, 2012. g) Sale and lease-back In 2008, the Association disposed of land and buildings in Richmond, British Columbia and leased back 63% of the premises through a ten-year operating lease. In accordance with accounting for sale and leaseback transactions under Canadian GAAP, $5,166 of the total gain was recognized in the consolidated statements of income and $7,329 was deferred and was being amortized over the remaining term of the lease. Unlike Canadian GAAP, which defers the gain, under IFRS, since the transaction was conducted at fair value, the gain on the sale and lease-back is not deferred but is recognized in the consolidated statements of income on the date of the transaction. This resulted in the elimination of the deferred gain of $5,261 as at April 1, 2011 with an offsetting adjustment to net assets. h) Hedge accounting The Association applied hedge accounting under Canadian GAAP and the balance of unrealized forward foreign exchange contract gains from previous years of $357 was reclassified from unrestricted net assets to accumulate other comprehensive income in the opening net assets as at April 1, 2011. All of these contracts were settled in the following year. The balance of unrealized gains was recognized in the consolidated statements of income and eliminated from accumulated other comprehensive income in the consolidated statements of changes in net assets. As the Association has elected not to use hedge accounting under IFRS, the unrealized net fair value loss of $814 was recognized directly in the consolidated statement of income for the year ended March 31, 2012. In addition, the foreign exchange option contract gains, relating to contracts settled in fiscal 2012, of $1,050 under Canadian GAAP were reclassified from revenue to finance income in the consolidated statement of income for the year ended March 31, 2012. i) Net assets There is currently no guidance for the treatment of net assets of non-profit oriented entities under IFRS. As a result, net assets are presented with segregating balances into externally and internally reserved funds as previously disclosed under Canadian GAAP.CSA Group Annual Report 2012 | 2013 56 

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### CSA Group is an independent, not-for-profit membership association dedicated to safety, social good and sustainability. Its knowledge and expertise encompass standards development; training and advisory solutions; global testing and certification services across key business areas including hazardous locations and industrial, plumbing and construction, medical, safety and technology, appliances and gas, alternative energy, lighting and sustainability; as well as consumer product evaluation services. The CSA certification mark appears on billions of products worldwide. We are dedicated to making standards work for people and business.