Exhibit 99.1


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) and the audited Consolidated Financial Statements and Notes
included in our Annual Information Form for the fiscal year ended February 28, 2002.





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 ended May
312002

2001Income (loss) before taxesU.S. GAAP

$
14,575

$
(15,749
)Income (loss) before taxesCanadian GAAP

$
14,077

$
(16,398
)Income tax provision (benefit)U.S. GAAP

$
4,664

$
(4,647
)Income tax provision (benefit)Canadian GAAP

$
5,323

$
(4,077
)Net income (loss) per share dilutedU.S. GAAP


$0.11


$(0.13
)Net income(loss) per share dilutedCanadian GAAP


$0.10


$(0.14
)




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Exhibit 99.1


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 net income before taxes by $1.8 million for the three months ended May 31, 2002 and to increase loss before taxes
by $1.9 million for the three months ended May 31, 2001, 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 to be deducted from the income tax provision. The impact of this difference was to increase net income before taxes and the income tax provision by $1.3 million for the three months ended May 31, 2002; and decrease net loss before taxes
and the income tax benefit by $1.3 million for the three months ended May 31, 2001, 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 $0.7 million for the quarter ended May 31, 2002 and increased the income tax benefit by $0.7 million for the three months ended May 31, 2001.




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