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Exhibit 99.2

COGNOS INCORPORATED

MANAGEMENTS
DISCUSSION AND ANALYSIS OF 
FINANCIAL CONDITION AND RESULTS OF OPERATIONS-CANADIAN
SUPPLEMENT(in United States
dollars, unless otherwise indicated, and in accordance with CDN GAAP)

The following Managements
Discussion and Analysis of Financial Condition and Results of Operations-Canadian
Supplement (Canadian Supplement) should be read in conjunction with our
Managements Discussion and Analysis of Financial Condition and Results of Operations
(MD&A) included in Item 2 of this quarterly report. The Canadian
Supplement should also be read in conjunction with the unaudited Consolidated Financial
Statements and Notes prepared in accordance with U.S. GAAP (included in Item 1), the
unaudited Consolidated Financial Statements and Notes prepared in accordance with Canadian
generally accepted accounting principles (Canadian GAAP) (included as exhibit
99.1) and the audited Consolidated Financial Statements and Notes included in our Annual
Information Form for the fiscal year ended February 28, 2003.

The following contains
forward-looking statements and should be read in conjunction with the factors set forth in
the Certain Factors That May Affect Future Results section of the MD&A in
Item 2 of this quarterly report. All dollar amounts in this Canadian Supplement are in
thousands of United States dollars unless otherwise stated. The Canadian Supplement has
been prepared by management to provide an analysis of the material differences between
Canadian GAAP and U.S. GAAP on our financial condition and results of operations.

# RESULTS OF OPERATIONS

|                                             |  | Three months endedNovember 30, |  | Nine months endedNovember 30, | 
|-------------------------------------------- |  | ------------------------------ |  | ----------------------------- | 
|                                            
|                                             |  | 2003                           |  | 2002                          | 
|                                            
|Income before taxes - U.S. GAAP              |  | $31,214                        |  | $29,308                       | 
|Income before taxes - Canadian GAAP          |  | $35,338                        |  | $30,277                       | 
|Income tax provision - U.S. GAAP             |  | $  6,966                       |  | $  9,379                      | 
|Income tax provision - Canadian GAAP         |  | $11,412                        |  | $11,100                       | 
|Net income per share diluted - U.S. GAAP     |  | $0.26                          |  | $0.22                         | 
|Net income per share diluted - Canadian GAAP |  | $0.26                          |  | $0.21                         | 

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COGNOS INCORPORATED

MANAGEMENTS
DISCUSSION AND ANALYSIS OF 
FINANCIAL CONDITION AND RESULTS OF OPERATIONS-CANADIAN
SUPPLEMENT(in United States
dollars, unless otherwise indicated, and in accordance with CDN GAAP)

Acquired in-process
technology

Canadian GAAP requires capitalization
of the value assigned to acquired in-process technology and amortization of this value
over its estimated useful life. Under U.S. GAAP, this value is written off immediately.
The impact of this difference was to decrease income before taxes by $0.5 million and $1.2
million for the three months ended November 30, 2003 and November 30, 2002,
respectively, compared to U.S. GAAP. For the nine-month periods ended November 30, 2003
and November 30, 2002, the impact of this difference was to decrease income before taxes
by $1.5 million and $4.6 million, respectively, as compared to U.S. GAAP.

Investment tax credits

Canadian GAAP requires that
investment tax credits be deducted from operating expense. Under U.S. GAAP, these amounts
are deducted from the income tax provision. The impact of this difference was to increase
income before taxes and the income tax provision by $4.6 million and $2.2 million for the
three months ended November 30, 2003 and November 30, 2002, respectively compared to
U.S. GAAP. For the nine-month periods ended November 30, 2003 and November 30, 2002, the
impact of this difference was to increase income before taxes and the income tax provision
by $11.9 million and $4.8 million, respectively as compared to U.S. GAAP.

Deferred income taxes
related to acquired in-process technology

The above noted difference related to
the capitalization of in-process technology created an additional deferred income tax
liability on the Canadian GAAP balance sheet as the capitalization of the in-process
technology created a temporary difference. The amortization of this balance decreased the
Canadian GAAP income tax provision by $0.2 million and $0.5 million for the quarters ended
November 30, 2003 and November 30, 2002, respectively as compared to U.S. GAAP.
For the nine-month periods ended November 30, 2003 and November 30, 2002, the amortization
of this balance decreased the Canadian GAAP income tax provision by $0.5 million and $1.7
million, respectively as compared to U.S. GAAP.

70