Readers are referred to the cautionary notes regarding Forward-looking Information & non-GAAP and non-IFRS Financial Measures at the end of this release

Listed TSX, Symbol: CNJ

TORONTO AND WINNIPEG, March 16 /CNW/ - Cangene today announces that it has received approval from the Canadian securities regulatory authorities to prepare its financial statements in accordance with International Financial Reporting Standards ("IFRS") for financial reporting periods beginning on or after January 1, 2010, one year ahead of the mandatory conversion date for Canadian public companies. Accordingly, the Company intends to adopt IFRS retroactive to its interim financial reporting period beginning August 1, 2010 with an August 1, 2009 date of transition ("Transition Date") and including comparatives for the interim reporting periods starting August 1, 2009.

The conversion to IFRS reduced the assets of the Company at the Transition Date from C$345.8 million to US$261.0 million. This reduction results exclusively from the Company's retroactive restatement of its financial statements under IFRS and is due primarily to the change of the Company's functional and reporting currency to the U.S. dollar, as well as the recording of goodwill, and property, plant and equipment impairments. The following information outlines and quantifies the specific areas of the Company's historical financial reporting that were affected by this conversion.

IFRS Conversion Plan
The Company's implementation of IFRS consisted of three primary phases as follows:

[a]	Scoping and diagnostics (Q4, 2009)
	This phase involved performing a high-level impact assessment to identify key areas potentially impacted by the transition to IFRS. Based on this assessment, potentially affected areas were ranked as high, medium or low priority.
[b]	Impact analysis, evaluation and design (2010)
	This phase involved the identification of all the major components of the IFRS conversion plan and the preparation of a timeline for completion of each of those components. It included the specification of changes to existing accounting policies, information systems and business processes that were required. In addition, policy alternatives allowed under IFRS were analyzed. This analysis included an evaluation of the transitional provisions of IFRS 1 - First-time Adoption of IFRS and the development of draft IFRS financial statement content.
[c]	Implementation and review (Q1-Q2, 2011)
	This phase included execution of changes to information systems and business processes, and selecting and obtaining formal approval of recommended accounting policy changes. Further training for Cangene's finance and other staff was completed as necessary. The Company monitored exposure drafts issued by the International Accounting Standards Board ("IASB"), the International Financial Reporting Interpretation Committee and other standards setters to ensure adoption of any relevant updates to standards that may have taken place during the period of transition to IFRS. This phase culminated in the collection of the financial information necessary for compiling IFRS-compliant financial statements, approval of these statements by the Audit Committee of our Board of Directors and the absorption of IFRS within all relevant business processes.

Accounting Policy Decisions
IFRS 1 - First-time Adoption of IFRS:
IFRS 1 provides entities adopting IFRS for the first time with a number of optional exemptions and mandatory exceptions to the general requirement for full retrospective application of IFRS. The Company analyzed the various accounting policy options available and has implemented those that it determined to be the most appropriate for its specific circumstances. The IFRS 1 exemptions most relevant to Cangene are as follows:

		Business combinations An exemption is available within IFRS 1 that allows an entity to carry forward its previous GAAP accounting for business combinations prior to the transition date. The exemption is optional and can be applied to any business combination transaction prior to the transition date. However, should an entity choose to adjust a prior business combination to comply with IFRS, all business combinations subsequent to the date of the adjusted transaction must also be retrospectively adjusted. Cangene elected to retrospectively apply IFRS 3 - Business Combinations to business combinations that occurred subsequent to June 30, 2009.
		Share-based payment transactions This exemption allows first-time adopters to not apply IFRS 2 - Share-based Payments to equity instruments that were granted prior to November 7, 2002. It also allows the first-time adopter to not apply IFRS 2 to equity instruments granted after November 7, 2002 that vested before transition to IFRS. The Company has applied this exemption to all outstanding equity-settled instruments prior to its transition date of August 1, 2009 to the extent possible. As all the stock option plan awards had vested before the transition to IFRS, an equity adjustment to reclassify contributed surplus to retained earnings was recorded.
		Fair value or revaluation as deemed cost This exemption allows an entity to revalue property, plant and equipment at fair value at its transition date and use this fair value as the deemed transition cost. This election applies to individual assets. Cangene did not apply this exemption.
		Cumulative translation difference This exemption allows cumulative translation gains and losses to be deemed zero at transition. Cangene applied this exemption to the extent possible.
		Borrowing costs This exemption allows an entity to adopt International Accounting Standards ("IAS") 23 - Borrowing Costs prospectively for property, plant and equipment construction projects for which the capitalization commencement date is after its transition date. Cangene applied this exemption to the extent possible. Cangene has availed itself of the recent IASB annual improvements guidance on IFRS 1 - Borrowing Costs, and will not restate any borrowing costs that were capitalized prior to August 1, 2009.
		Estimates IFRS 1 stipulates a mandatory exemption from full retrospective application of IFRS as it relates to the use of estimates. It requires that a company's estimates in accordance with IFRS at the date of transition to IFRS must be consistent with estimates made for the same date in accordance with previous Canadian GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error. The Company did not use hindsight in its estimates upon transition to IFRS, nor did it find any evidence that any of its previously made estimates were in error.

IAS 1 - Presentation of Financial Statements:
Canadian GAAP requires certain profit or loss expense categories to be disclosed separately on the statement of income and comprehensive income. Under IFRS, a company has a choice of adopting the nature of expense method or the function of expense method in presenting its analysis of expenses, whichever provides information that is reliable and most relevant.

The Company has elected the function of expense method which classifies expenses according to their function. Accordingly, amortization, foreign-exchange gains (losses), and gains or losses on disposal of property, plant and equipment, which were previously disclosed separately under Canadian GAAP, have now been allocated to cost of sales, independent R&D, and selling, general and administrative expenses. Any foreign-exchange gains (losses) related to finance expenses, such as those used to hedge against interest rate or currency rate risk, remain as a separate line of disclosure on the statement of comprehensive income (loss) under IFRS.

IFRS 2 - Share-based Payments:
Under Canadian GAAP the Company's cash-settled phantom-stock incentive plan ("PSIP"), restricted share unit plan ("RSU plan") and deferred share unit plan ("DSU plan") were accounted for based on their intrinsic values. Under IFRS, share-based payment liabilities are required to be accounted for at fair value using an option pricing model.

IAS 12 - Income Taxes:
Canadian GAAP prohibits the recognition of deferred taxes on the intercompany transfer of assets. Deferred tax is not recognized in the consolidated financial statements for the difference between the tax basis of the buyer and the cost as it is reported in the consolidated financial statements. Any taxes paid or recovered by the transferor as a result of the transfer are recorded as an asset or liability in the consolidated financial statements until the gain or loss is recognized by the consolidated entity.

IAS 12 contains no exception to prohibit the recognition of deferred tax on the intercompany transfer of assets. Therefore, deferred tax is recognized for temporary differences arising on intercompany transactions measured at the tax rate of the buyer, and cash tax paid or recovered on intercompany transactions is recognized in the period incurred. Deferred tax assets have been recorded with respect to these temporary differences.

In addition, certain deferred tax assets and liabilities have been reclassified to conform to IAS 12 standards. Canadian GAAP allows current and deferred income tax liabilities and assets to be offset if they relate to the same taxable entity and the same taxation authority. However, if a company classifies assets and liabilities as current and non-current, the current portion of the balance cannot be offset with the non-current portion. When a group of companies is taxed by the same taxation authority, a deferred tax asset of one of the companies cannot be offset with the liability of one of the other companies, unless tax planning strategies could be implemented such that an offset would be available. IAS 12 does not permit deferred tax assets and liabilities to be classified as current assets or liabilities. In addition, IAS 12 allows for the offset of deferred tax assets and liabilities if, and only if:

the entity has a legally enforceable right to set off current tax assets against current tax liabilities; and
the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either:

the same taxable entity;
or different taxable entities that intend either to settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.

IAS 16 - Property, Plant and Equipment ("PP&E"):
Under IFRS, each component of an item of PP&E with a cost that is significant in relation to the total cost of the item shall be depreciated separately. This is known as the component approach. Compound assets, such as a building or plant, consist of significant parts, and each significant part is depreciated separately. Further, under IAS 16, the residual value and the useful life of an asset shall be reviewed on an annual basis and, if expectations differ from the previous estimate, the change is accounted for as a change in accounting estimate.

The Company has finalized its assessment of the component approach under IFRS and has determined that a building's foundation, which typically consists of a combination of concrete and steel, is a separate component from the rest of the building. Accordingly, all of the Company's buildings have been retrospectively assigned a life of 60 years for the structure component and 25 years for the rest of building component. Under Canadian GAAP, the useful lives of our buildings were between 25 and 30 years.

Under IFRS, an entity is required to reassess its PP&E useful-life estimates at the end of each fiscal year. Under Canadian GAAP, the timing of this review is less specific. In accordance with IAS 16, the Company reviewed its capital asset useful lives of its various components as at July 31, 2009 and July 31, 2010. It has determined that equipment has useful lives of five to fifteen years, depending upon equipment type. Under Canadian GAAP, the Company had assigned useful lives to manufacturing and laboratory equipment of five to ten years.

IAS 19 - Employee Benefits:
The Company has a service award program that provides each employee with prescribed cash equivalent awards at defined years of service intervals. Under Canadian GAAP, this type of program is not considered to be obligatory and thus a liability does not exist at the balance sheet date. Under IFRS, this program is considered to represent a liability at the balance sheet date based on the likelihood that this program will continue for the foreseeable future. A liability is recorded and is determined using actuarial estimating, which in this case takes into account age, years of service and projected turnover.

IAS 21 - The Effects of Changes in Foreign-exchange Rates:
In accordance with Canadian GAAP, the Company had determined that Cangene's functional and reporting currency was the Canadian dollar, and that its U.S. subsidiaries were integrated foreign operations. IFRS requires that the functional currency of each entity in a consolidated group be determined separately based on the currency of the primary economic environment in which the entity operates. A list of primary and secondary indicators is used under IFRS in this determination, and these differ in content and emphasis from those factors used under Canadian GAAP. Accordingly, for IFRS, Cangene has determined that the functional currency of the Corporation, including its U.S. subsidiaries, is the U.S. dollar and in particular, August 1, 2002 is the date at which the U.S. dollar became the functional currency of the Company's Canadian operations. The net result going forward will be a decrease in earnings volatility that is due to foreign-exchange fluctuations as the Company's exposure to Canadian-dollar revenues and expenses is significantly less than its exposure to U.S.-dollar revenue and expenses. The Company has retrospectively applied the functional currency determination to prior periods. Accordingly, non-monetary assets and liabilities, including: inventory; prepaid expenses; property, plant and equipment; intangible assets; goodwill; other assets; and deferred income, were required to be restated in U.S. dollars based on historical conversion rates and monetary assets were required to be restated in U.S. dollars at the exchange rates in effect at the period-end balance sheet dates. Revenues and expenses were converted to U.S. dollars at either the exchange rates that were in effect on the dates that they were incurred or at the average exchange rates in the months in which they were incurred.

IAS 34 - Interim Financial Reporting:
Under Canadian GAAP, the Company was allowed to assess its normal manufacturing capacity on an annual basis. At the end of each quarter, it did an assessment of projected manufacturing activity for the remainder of the year and used its latest projection of its current-year manufacturing-capacity utilization to determine how much fixed overhead to capitalize to inventory in the current quarter. Under IFRS, the Company still assesses its normal manufacturing capacity on an annual basis. However, IAS 34 does not allow companies to use projected manufacturing activity as a basis for determining over or under applied fixed overhead at the end of each quarter. Any unallocated overheads incurred in a quarter are treated as an expense in that quarter.

IAS 36 - Impairment of Assets:
Upon adoption of IFRS, the Company is required to test its goodwill for impairment in accordance with IAS 36. Furthermore, IFRS requires that the Company conduct a long-lived asset-impairment test at the date of adoption of IFRS if indicators of impairment exist. There are several differences that exist between current Canadian GAAP and IFRS for impairment of non-financial assets, which include:

the test for non-financial asset impairment requires the use of a discounted cash flow model, whereas Canadian GAAP uses a two-step impairment test that is first based on undiscounted cash flows and then discounted cash flows;
testing for impairment occurs at the level of cash generating units ("CGUs"), which is the lowest level of assets that generate largely independent cash inflows, whereas Canadian GAAP requires impairment tests at the asset group level;
testing for goodwill impairment occurs at the lowest level at which management monitors goodwill (goodwill CGU); however, it cannot be higher than an operating segment, whereas Canadian GAAP requires the impairment test to be assessed at the reporting unit level; and
IFRS allows the reversal of previous impairment losses, with the exception of goodwill, whereas Canadian GAAP prohibits the reversal of non-financial asset impairments.

Upon adoption of IAS 36 at transition, the Company identified both a goodwill impairment loss and a long-lived asset impairment loss at one of its CGUs and a long-lived asset impairment loss at another one of its CGUs.

Impact of Adopting IFRS
The impact of adopting IFRS on the Company's prior-period interim financial statements is as follows:

Reconciliation of Consolidated Balance Sheet as at August 1, 2009:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts	Canadian GAAP balances		Adjustment for transition to IFRS		IFRS balances		Endnote	IFRS accounts

ASSETS								ASSETS
Current
Cash	C$	56,131	$	(4,359)	$	51,772	1	Cash
Accounts receivable		34,547		(2,774)		31,773	1	Accounts receivable
Inventories and contracts in progress		92,430		(10,549)		81,881	1	Inventories and contracts in progress
Income and other taxes recoverable		6,281		(776)		5,505	2	Taxes recoverable
Future income taxes		8,231		(8,231)		—	3
Prepaid expenses and deposits		2,830		(337)		2,493	1	Prepaid expenses and deposits
Total current assets		200,450		(27,026)		173,424		Total current assets
Property, plant and equipment, net		96,347		(30,337)		66,010	4	Property, plant and equipment, net
Future income taxes		—		15,693		15,693	5	Deferred tax
Goodwill and intangible assets, net		43,578		(38,590)		4,988	6	Goodwill and intangible assets, net
Other assets		5,460		(4,611)		849	7	Other assets
	C$	345,835	$	(84,871)	$	260,964

LIABILITIES AND SHAREHOLDERS' EQUITY								LIABILITIES AND EQUITY
Current								Current
Accounts payable and accrued liabilities	C$	27,948	$	(2,093)	$	25,855	8	Accounts payable and accrued liabilities
Income and other taxes payable		4,126		(321)		3,805	9	Taxes payable
Current portion of deferred income		5,875		(770)		5,105	1	Current portion of deferred income
Total current liabilities		37,949		(3,184)		34,765		Total current liabilities
Deferred income		9,906		(1,202)		8,704	1	Deferred income
Incentive plan liability		122		2,344		2,466	10	Incentive plan liability
Future income taxes		5,522		(2,805)		2,717	11	Deferred tax
Total liabilities		53,499		(4,847)		48,652		Total liabilities

Shareholders' equity								Equity
Share capital		65,655		(13,279)		52,376	1	Share capital
Contributed surplus		3,239		(3,239)		—	12
Accumulated other comprehensive loss		(4,467)		4,467		—	13
Retained earnings		227,909		(67,973)		159,936	14	Retained earnings
Total shareholders' equity		292,336		(80,024)		212,312		Total equity
	C$	345,835	$	(84,871)	$	260,964

Reconciliation of Consolidated Balance Sheet as at October 31, 2009:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts	Canadian GAAP balances		Cumulative IFRS adjustments from prior periods		Q1 2010 IFRS adjustment		IFRS balances		Endnote	IFRS accounts

ASSETS										ASSETS
Current
Cash	C$	35,245	$	(4,359)	$	2,145	$	33,031	15	Cash
Accounts receivable		39,882		(2,774)		(108)		37,000	15	Accounts receivable
Inventories and contracts in progress		96,459		(10,549)		419		86,329	16	Inventories and contracts in progress
Income and other taxes recoverable		9,208		(776)		839		9,271	17	Taxes recoverable
Future income taxes		5,816		(8,231)		2,415		—	18
Prepaid expenses and deposits		3,963		(337)		(11)		3,615	15	Prepaid expenses and deposits
Total current assets		190,573		(27,026)		5,699		169,246		Total current assets
Property, plant and equipment, net		95,271		(30,337)		676		65,610	19	Property, plant and equipment, net
Future income taxes		528		15,693		(2,981)		13,240	20	Deferred tax
Goodwill and intangible assets, net		43,459		(38,590)		52		4,921	15	Goodwill and intangible assets, net
Other assets		12,430		(4,611)		(179)		7,640	21	Other assets
	C$	342,261	$	(84,871)	$	3,267	$	260,657

LIABILITIES AND SHAREHOLDERS' EQUITY										LIABILITIES AND EQUITY
Current										Current
Accounts payable and accrued liabilities	C$	23,585	$	(2,093)	$	405	$	21,897	15	Accounts payable and accrued liabilities
Income and other taxes payable		17		(321)		320		16	22	Taxes payable
Current portion of deferred income		5,408		(770)		145		4,783	15	Current portion of deferred income
Total current liabilities		29,010		(3,184)		870		26,696		Total current liabilities
Deferred income		10,538		(1,202)		29		9,365	15	Deferred income
Incentive plan liability		2,148		2,344		124		4,616	23	Incentive plan liability
Deferred share unit liability		60		—		(4)		56	15	Deferred share unit liability
Future income taxes		3,954		(2,805)		324		1,473	24	Deferred tax
Total liabilities		45,710		(4,847)		1,343		42,206		Total liabilities

Shareholders' equity										Equity
Share capital		65,557		(13,279)		20		52,298	15	Share capital
Contributed surplus		3,239		(3,239)		—		—
Accumulated other comprehensive loss		(4,467)		4,467		—		—
Retained earnings		232,222		(67,973)		1,904		166,153	25	Retained earnings
Total shareholders' equity		296,551		(80,024)		1,924		218,451		Total equity
	C$	342,261	$	(84,871)	$	3,267	$	260,657

Reconciliation of Consolidated Statement of Income and Comprehensive Income for the three-month period ended October 31, 2009:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts	Canadian GAAP balances		Effect of transition to IFRS		IFRS balances		Endnote	IFRS accounts

Revenues								Revenues
Product sales and services	C$	31,975	$	(2,246)	$	29,729	26	Product sales and services
R&D services		7,823		(679)		7,144	26	R&D services
Royalties		2,234		(118)		2,116	26	Royalties
		42,032		(3,043)		38,989

Cost of sales								Cost of sales
Product sales and services		15,712		754		16,466	27	Product sales and services
R&D services		6,269		(284)		5,985	28	R&D services
		21,981		470		22,451
Gross profit		20,051		(3,513)		16,538		Gross profit

Expenses								Expenses
Independent R&D		3,461		(271)		3,190	29	Independent R&D
Selling, general and administrative		5,053		(68)		4,985	30	Selling, general and administrative
Amortization		3,289		(3,289)		—	31
		11,803		(3,628)		8,175
Operating profit		8,248		115		8,363		Operating profit
Short-term interest income		25		(2)		23	26	Short-term interest income
Foreign-exchange gain (loss)		(943)		1,177		234	32	Foreign-exchange gain (loss)

Income before income taxes		7,330		1,290		8,620		Income before tax
Income tax expense								Tax expense
Current		736		409		1,145	33	Current
Future		1,274		(352)		922	33	Deferred
		2,010		57		2,067
Net income and comprehensive income for the period	C$	5,320	$	1,233	$	6,553		Net income and comprehensive income for the period

Reconciliation of Consolidated Balance Sheet as at January 31, 2010:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts	Canadian GAAP balances		Cumulative IFRS adjustments from prior periods		Q2 2010 IFRS adjustment		IFRS balances		Endnote	IFRS accounts

ASSETS										ASSETS
Current
Cash	C$	30,213		(2,214)		338		28,337	34	Cash
Accounts receivable		42,734		(2,882)		228		40,080	34	Accounts receivable
Inventories and contracts in progress		99,534		(10,130)		611		90,015	35	Inventories and contracts in progress
Income and other taxes recoverable		10,632		63		(10)		10,685	36	Taxes recoverable
Future income taxes		5,400		(5,816)		416		—	37
Prepaid expenses and deposits		2,979		(348)		101		2,732	34	Prepaid expenses and deposits
Total current assets		191,492		(21,327)		1,684		171,849		Total current assets
Property, plant and equipment, net		95,934		(29,661)		686		66,959	38	Property, plant and equipment, net
Future income taxes		2,403		12,712		(46)		15,069	39	Deferred tax
Goodwill and intangible assets, net		57,689		(38,538)		(926)		18,225	34	Goodwill and intangible assets, net
Other assets		4,327		(4,790)		893		430	40	Other assets
	C$	351,845		(81,604)		2,291		272,532

LIABILITIES AND SHAREHOLDERS' EQUITY										LIABILITIES AND EQUITY
Current										Current
Accounts payable and accrued liabilities	C$	20,623		(1,688)		303		19,238	34	Accounts payable and accrued liabilities
Income and other taxes payable		17		(1)		—		16		Taxes payable
Current portion of deferred income		5,525		(625)		13		4,913	34	Current portion of deferred income
Total current liabilities		26,165		(2,314)		316		24,167		Total current liabilities
Deferred income		11,294		(1,173)		(18)		10,103	34	Deferred income
Royalty liability		7,137		—		(201)		6,936	34	Royalty provision
Incentive plan liabilities		4,735		2,468		(647)		6,556	41	Incentive plan liabilities
Deferred share unit liability		141		(4)		(5)		132	34	Deferred share unit liability
Future income taxes		3,229		(2,481)		828		1,576	42	Deferred tax
Total liabilities		52,701		(3,504)		273		49,470		Total liabilities

Shareholders' equity										Equity
Share capital		65,356		(13,259)		41		52,138	34	Share capital
Contributed surplus		3,239		(3,239)		—		—
Accumulated other comprehensive loss		(4,467)		4,467		—		—
Retained earnings		235,016		(66,069)		1,977		170,924	43	Retained earnings
Total shareholders' equity		299,144		(78,100)		2,018		223,062		Total equity
	C$	351,845		(81,604)		2,291		272,532

Reconciliation of Consolidated Statement of Income and Comprehensive Income for the three-month period ended January 31, 2010:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts		Canadian GAAP balances		Effect of transition to IFRS		IFRS balances		Endnote	IFRS accounts

Revenues									Revenues
Product sales and services		C$	35,542	$	(2,148)	$	33,394	44	Product sales and services
R&D services			4,123		(262)		3,861	44	R&D services
Royalties			1,871		(79)		1,792	44	Royalties
			41,536		(2,489)		39,047

Cost of sales									Cost of sales
Product sales and services			20,421		312		20,733	45	Product sales and services
R&D services			3,051		(282)		2,769	46	R&D services
			23,472		30		23,502
Gross profit			18,064		(2,519)		15,545		Gross profit

Expenses									Expenses
Independent R&D			2,723		(254)		2,469	47	Independent R&D
Selling, general and administrative			7,413		(304)		7,109	48	Selling, general and administrative
Amortization			3,868		(3,868)		—	49
			14,004		(4,426)		9,578
Operating profit			4,060		1,907		5,967		Operating profit
Short-term interest income			8		(1)		7	44	Short-term interest income
Foreign-exchange gain (loss)			210		(122)		88	50	Foreign-exchange gain (loss)

Income before income taxes			4,278		1,784		6,062		Income before tax
Income tax expense (recovery)									Tax expense (recovery)
	Current		2,313		(235)		2,078	51		Current
	Future		(1,818)		92		(1,726)	51		Deferred
			495		(143)		352
Net income and comprehensive income for the period		C$	3,783	$	1,927	$	5,710		Net income and comprehensive income for the period

Reconciliation of Consolidated Balance Sheet as at April 30, 2010:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts	Canadian GAAP balances		Cumulative IFRS adjustments from prior periods	Q3 2010 IFRS adjustment	IFRS balances	Endnote	IFRS accounts

ASSETS							ASSETS
Current
Cash	C$	32,531	(1,876)	1,701	32,356	52	Cash
Accounts receivable		33,822	(2,654)	2,410	33,578	52	Accounts receivable
Inventories and contracts in progress		94,154	(9,519)	1,817	86,452	53	Inventories and contracts in progress
Income and other taxes recoverable		14,209	53	177	14,439	54	Taxes recoverable
Future income taxes		5,515	(5,400)	(115)	—	55
Prepaid expenses and deposits		2,668	(247)	68	2,489	52	Prepaid expenses and deposits
Total current assets		182,899	(19,643)	6,058	169,314		Total current assets
Property, plant and equipment, net		104,792	(28,975)	473	76,290	56	Property, plant and equipment, net
Future income taxes		3,513	12,666	775	16,954	57	Deferred tax
Goodwill and intangible assets, net		57,002	(39,464)	60	17,598	52	Goodwill and intangible assets, net
Other assets		3,689	(3,897)	428	220	58	Other assets
	C$	351,895	(79,313)	7,794	280,376

LIABILITIES AND SHAREHOLDERS' EQUITY							LIABILITIES AND EQUITY
Current							Current
Accounts payable and accrued liabilities	C$	23,427	(1,385)	1,336	23,378	52	Accounts payable and accrued liabilities
Income and other taxes payable		9	(1)	1	9	52	Taxes payable
Current portion of deferred income		5,032	(612)	71	4,491	52	Current portion of deferred income
Total current liabilities		28,468	(1,998)	1,408	27,878		Total current liabilities
Deferred income		11,883	(1,191)	109	10,801	52	Deferred income
Royalty liability		6,416	(201)	166	6,381	52	Royalty provision
Incentive plan liabilities		2,692	1,821	594	5,107	59	Incentive plan liabilities
Deferred share unit liability		161	(9)	8	160	52	Deferred share unit liability
Future income taxes		3,492	(1,653)	(121)	1,718	60	Deferred tax
Total liabilities		53,112	(3,231)	2,164	52,045		Total liabilities

Shareholders' equity							Equity
Share capital		65,187	(13,218)	34	52,003	52	Share capital
Contributed surplus		3,239	(3,239)	—	—
Accumulated other comprehensive loss		(4,467)	4,467	—	—
Retained earnings		234,824	(64,092)	5,596	176,328	61	Retained earnings
Total shareholders' equity		298,783	(76,082)	5,630	228,331		Total equity
	C$	351,895	(79,313)	7,794	280,376

Reconciliation of Consolidated Statement of Income (Loss) and Comprehensive Income (Loss) for the three-month period ended April 30, 2010:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts		Canadian GAAP balances		Effect of transition to IFRS		IFRS balances		Endnote	IFRS accounts

Revenues									Revenues
Product sales and services		C$	33,662	$	(1,362)	$	32,300	62	Product sales and services
R&D services			5,677		(214)		5,463	62	R&D services
Royalties			1,783		(8)		1,775	62	Royalties
			41,122		(1,584)		39,538

Cost of sales									Cost of sales
Product sales and services			21,970		549		22,519	63	Product sales and services
R&D services			3,987		(114)		3,873	64	R&D services
			25,957		435		26,392
Gross profit			15,165		(2,019)		13,146		Gross profit

Expenses									Expenses
Independent R&D			2,570		(164)		2,406	65	Independent R&D
Selling, general and administrative			5,701		415		6,116	66	Selling, general and administrative
Amortization			4,170		(4,170)		—	67
			12,441		(3,919)		8,522
Operating profit			2,724		1,900		4,624		Operating profit
Short-term interest income			8		—		8	62	Short-term interest income
Foreign-exchange gain (loss)			(4,001)		3,366		(635)	68	Foreign-exchange gain (loss)

Income (loss) before income taxes			(1,269)		5,266		3,997		Income (loss) before tax
Income tax expense (recovery)									Tax expense (recovery)
	Current		471		(889)		(418)	69		Current
	Future		(1,414)		(329)		(1,743)	69		Deferred
			(943)		(1,218)		(2,161)
Net income (loss) and comprehensive income for the period		C$	(326)	$	6,484	$	6,158		Net income (loss) and comprehensive income for the period

Reconciliation of Consolidated Balance Sheet as at July 31, 2010:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts	Canadian GAAP balances		Cumulative IFRS adjustments from prior periods		Q4 2010 IFRS adjustment	IFRS balances		Endnote	IFRS accounts

ASSETS									ASSETS
Current
Cash	C$	41,828	$	(175)	(1,287)	$	40,366	70	Cash
Accounts receivable		18,908		(244)	(416)		18,248	70	Accounts receivable
Inventories and contracts in progress		93,691		(7,702)	(121)		85,868	71	Inventories and contracts in progress
Income and other taxes recoverable		10,846		230	(609)		10,467	72	Taxes recoverable
Future income taxes		4,671		(5,515)	844		—	73
Prepaid expenses and deposits		3,196		(179)	(22)		2,995	70	Prepaid expenses and deposits
Total current assets		173,140		(13,585)	(1,611)		157,944		Total current assets
Property, plant and equipment, net		106,776		(28,502)	587		78,861	74	Property, plant and equipment, net
Income and other taxes recoverable		5,600		—	(196)		5,404	70	Taxes recoverable
Future income taxes		2,707		13,441	(308)		15,840	75	Deferred tax
Goodwill and intangible assets, net		56,458		(39,404)	52		17,106	70	Goodwill and intangible assets, net
Other assets		4,619		(3,469)	(1,110)		40	76	Other assets
	C$	349,300	$	(71,519)	(2,586)	$	275,195
LIABILITIES AND SHAREHOLDERS' EQUITY									LIABILITIES AND EQUITY
Current									Current
Accounts payable and accrued liabilities	C$	25,926	$	(49)	(615)	$	25,262	77	Accounts payable and accrued liabilities
Income and other taxes payable		76		—	(3)		73	70	Taxes payable
Current portion of deferred income		3,510		(541)	405		3,374	70	Current portion of deferred income
Total current liabilities		29,512		(590)	(213)		28,709		Total current liabilities
Deferred income		10,440		(1,082)	235		9,593	70	Deferred income
Royalty liability		6,292		(35)	(185)		6,072	70	Royalty provision
Incentive plan liabilities		2,655		2,415	(1,476)		3,594	78	Incentive plan liabilities
Deferred share unit liability		181		(1)	(6)		174	70	Deferred share unit liability
Future income taxes		3,612		(1,774)	224		2,062	79	Deferred tax
Total liabilities		52,692		(1,067)	(1,421)		50,204		Total liabilities

Shareholders' equity									Equity
Share capital		64,802		(13,184)	78		51,696	70	Share capital
Contributed surplus		3,239		(3,239)	—		—
Accumulated other comprehensive loss		(4,467)		4,467	—		—
Retained earnings		233,034		(58,496)	(1,243)		173,295	80	Retained earnings
Total shareholders' equity		296,608		(70,452)	(1,165)		224,991		Total equity
	C$	349,300	$	(71,519)	(2,586)	$	275,195

Reconciliation of Consolidated Statement of Income (Loss) and Comprehensive Income (Loss) for the three-month period ended July 31, 2010:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts		Canadian GAAP balances		Effect of transition to IFRS		IFRS balances		Endnote	IFRS accounts

Revenues									Revenues
Product sales and services		C$	29,135	$	(754)	$	28,381	81	Product sales and services
R&D services			3,636		(460)		3,176	81	R&D services
Royalties			1,401		(61)		1,340	81	Royalties
			34,172		(1,275)		32,897

Cost of sales									Cost of sales
Product sales and services			18,443		2,080		20,523	82	Product sales and services
R&D services			1,809		168		1,977	83	R&D services
			20,252		2,248		22,500
Gross profit			13,920		(3,523)		10,397		Gross profit

Expenses									Expenses
Independent R&D			5,663		(246)		5,417	84	Independent R&D
Selling, general and administrative			6,546		(306)		6,240	85	Selling, general and administrative
Amortization			3,651		(3,651)		—	86
Loss on disposal of assets			260		(260)		—	87
			16,120		(4,463)		11,657
Operating profit (loss)			(2,200)		940		(1,260)		Operating profit (loss)
Short-term interest income			7		—		7	81	Short-term interest income
Foreign-exchange gain (loss)			1,670		(1,293)		377	88	Foreign-exchange gain (loss)

Income (loss) before income taxes			(523)		(353)		(876)		Income (loss) before tax
Income tax expense (recovery)									Tax expense (recovery)
	Current		(950)		570		(380)	89		Current
	Future		1,091		367		1,458	89		Deferred
			141		(1,219)		(1,078)
Net income (loss) and comprehensive income (loss) for the period		C$	(664)	$	(1,290)	$	(1,954)		Net income (loss) and comprehensive income (loss) for the period

Reconciliation of Consolidated Balance Sheet as at October 31, 2010:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts	Canadian GAAP balances		Cumulative IFRS adjustments from prior periods		Q1 2011 IFRS adjustment	IFRS balances		Endnote	IFRS accounts

ASSETS									ASSETS
Current
Cash	C$	23,498	$	(1,462)	967	$	23,003	90	Cash
Accounts receivable		19,671		(660)	243		19,254	90	Accounts receivable
Inventories and contracts in progress		95,675		(7,823)	(302)		87,550	91	Inventories and contracts in progress
Income and other taxes recoverable		9,971		(379)	169		9,761	92	Taxes recoverable
Future income taxes		4,165		(4,671)	506		—	93
Prepaid expenses and deposits		3,693		(201)	32		3,524	90	Prepaid expenses and deposits
Total current assets		156,673		(15,196)	1,615		143,092		Total current assets
Property, plant and equipment, net		107,089		(27,915)	497		79,671	94	Property, plant and equipment, net
Income and other taxes recoverable		10,500		(196)	(25)		10,279	90	Taxes recoverable
Future income taxes		2,818		13,133	(185)		15,766	95	Deferred tax
Goodwill and intangible assets, net		55,703		(39,352)	67		16,418	90	Goodwill and intangible assets, net
Other assets		4,636		(4,579)	(57)		—	96	Other assets
	C$	337,419	$	(74,105)	1,912	$	265,226

LIABILITIES AND SHAREHOLDERS' EQUITY									LIABILITIES AND EQUITY
Current									Current
Accounts payable and accrued liabilities	C$	20,555	$	(664)	471	$	20,362	90	Accounts payable and accrued liabilities
Income and other taxes payable		130		(3)	—		127		Taxes payable
Current portion of deferred income		5,298		(136)	(161)		5,001	90	Current portion of deferred income
Total current liabilities		25,983		(803)	310		25,490		Total current liabilities
Deferred income		7,979		(847)	201		7,333	90	Deferred income
Royalty liability		5,886		(220)	96		5,762	90	Royalty provision
Incentive plan liability		4,083		939	(640)		4,382	97	Incentive plan liabilities
Deferred share unit liability		226		(7)	2		221	90	Deferred share unit liability
Future income taxes		3,225		(1,550)	281		1,956	98	Deferred tax
Total liabilities		47,382		(2,488)	250		45,144		Total liabilities
Shareholders' equity									Equity
Share capital		64,464		(13,106)	88		51,446	90	Share capital
Contributed surplus		3,239		(3,239)	—		—
Accumulated other comprehensive loss		(4,467)		4,467	—		—
Retained earnings		226,801		(59,739)	1,574		168,636	99	Retained earnings
Total shareholders' equity		290,037		(71,617)	1,662		220,082		Total equity
	C$	337,419	$	(74,105)	1,912	$	265,226

Reconciliation of Consolidated Statement of Income (Loss) and Comprehensive Income (Loss) for the three months ended October 31, 2010:

in thousands; U.S. dollars except as noted
Canadian GAAP accounts		Canadian GAAP balances		Effect of transition to IFRS		IFRS balances		Endnote	IFRS accounts

Revenues									Revenues
Product sales and services		C$	19,102	$	(600)	$	18,502	*100*	Product sales and services
R&D services			3,747		(153)		3,594	*100*	R&D services
Royalties			964		(18)		946	*100*	Royalties
			23,813		(771)		23,042

Cost of sales									Cost of sales
Product sales and services			11,917		1,201		13,118	*101*	Product sales and services
R&D services			2,763		(139)		2,624	*102*	R&D services
			14,680		1,062		15,742
Gross profit			9,133		(1,833)		7,300		Gross profit

Expenses									Expenses
Independent R&D			4,310		247		4,557	*103*	Independent R&D
Selling, general and administrative			6,790		(65)		6,725	*104*	Selling, general and administrative
Amortization			4,048		(4,048)		—	*105*
			15,148		(3,866)		11,282
Operating profit (loss)			(6,015)		2,033		(3,982)		Operating profit (loss)
Short-term interest income			12		(1)		11	*100*	Short-term interest income
Foreign exchange gain (loss)			(1,082)		(340)		(1,422)	*106*	Foreign-exchange gain (loss)

Income (loss) before income taxes			(7,085)		1,692		(5,393)		Income (loss) before tax
Income tax expense (recovery)									Tax expense (recovery)
	Current		(1,445)		(106)		(1,551)	*107*		Current
	Future		(280)		248		(32)	*107*		Deferred
			(1,725)		142		(1,583)
Net income (loss) and comprehensive income (loss) for the period		C$	(5,360)	$	1,550	$	(3,810)		Net income (loss) and comprehensive income (loss) for the period

Impact on Consolidated Statements of Cash Flows
The impact of converting to IFRS on the Company's Consolidated Statements of Cash Flows compared with its previously released Canadian GAAP Consolidated Statements of Cash Flows is directly related to the impacts on the Consolidated Statements of Income and Comprehensive Income and the Consolidated Balance Sheets as described above.

The lines of the Consolidated Statements of Cash Flows most affected by the conversion to IFRS are: net income (loss) for the period, amortization of property plant and equipment, amortization of intangible assets, incentive plan liabilities, unrealized foreign-exchange loss (gain), and purchase of property plant and equipment.

Cash flows related to non-monetary assets were especially impacted by the conversion to IFRS, since non-monetary assets were converted to IFRS at historical rates when there were often pronounced differences between the values of the U.S. and Canadian dollars.

Endnotes as referenced in the above reconciled financial statements:

	Applicable IFRS Standard	Resulting Adjustment	Amount
Reconciliation of Consolidated Balance Sheet as at August 1, 2009
1	IAS 21	Change of functional and reporting currency to USD	All

2	IAS 12	Reclassification to long-term deferred asset	(287)
	IAS 21	Change of functional and reporting currency to USD	(489)
			(776)

3	IAS 12	Reclassification to long-term deferred asset	(8,463)
	IAS 21	Change of functional and reporting currency to USD	232
			(8,231)

4	IAS 36	Building and equipment Impairment of Henlow Bay CGU	(3,347)
	IAS 16	Componentization and change in useful lives	1,275
	IAS 36	Building and equipment impairment of CBI Baltimore CGU	(7,163)
	IAS 21	Change of functional and reporting currency to USD	(21,102)
			(30,337)

5	IAS 12	Reclassification to long-term deferred asset	8,750
	Various	Tax impact from adoption of other IFRS standards	2,984
	IAS 12	Recognition of deferred tax on intercompany transfer of assets	3,372
	IAS 21	Change of functional and reporting currency to USD	587
			15,693

6	IAS 36	Goodwill impairment of CBI Baltimore CGU	(27,144)
	IAS 21	Change of functional and reporting currency to USD	(11,446)
			(38,590)

7	IAS 12	Recognition of deferred tax on intercompany transfer of assets	(4,514)
	IAS 21	Change of functional and reporting currency to USD	(97)
			(4,611)

8	IAS 19	Service award liability	138
	IAS 21	Change of functional and reporting currency to USD	(2,231)
			(2,093)

9	IAS 12	Recognition of deferred taxes on intercompany transfer of assets	(386)
	IAS 21	Change of functional and reporting currency to USD	65
			(321)

10	IFRS 2	Adjustment to fair value of share-based payments	2,354
	IAS 21	Change of functional and reporting currency to USD	(10)
			2,344

11	Various	Tax impact from adoption of other IFRS standards	(2,651)
	IAS 21	Change of functional and reporting currency to USD	(154)
			(2,805)

12	IFRS 1	Reclassification of contributed surplus to retained earnings	(3,239)

13	IFRS 1	Reclassification of cumulative translation adjustment to retained earnings	4,467

14	Various


Reconciliation of Consolidated Balance Sheet as at October 31, 2009
15	IAS 21	Change of functional and reporting currency to USD	All

16	IAS 2	Adjustment for unallocated overhead incurred in the quarter	(149)
	IAS 21	Change of functional and reporting currency to USD	568
			419

17	Various	Tax impact from adoption of other IFRS standards	51
	IAS 21	Change of functional and reporting currency to USD	788
			839

18	IAS 12	Reclassification to long-term deferred asset	2,457
	IAS 21	Change of functional and reporting currency to USD	(42)
			2,415

19	IAS 36	Building and equipment amortization reduction of Henlow Bay CGU	238
	IAS 16	Componentization and change in useful lives	(10)
	IAS 36	Building and equipment amortization reduction of CBI Baltimore CGU	115
	IAS 21	Change of functional and reporting currency to USD	333
			676

20	IAS 12	Reclassification to long-term deferred asset	(1,852)
	Various	Tax impact from adoption of other IFRS standards	211
	IAS 12	Recognition of deferred tax on intercompany transfer of assets	(447)
	IAS 21	Change of functional and reporting currency to USD	(893)
			(2,981)

21	IAS 12	Recognition of deferred taxes on intercompany transfer of assets	346
	IAS 21	Change of functional and reporting currency to USD	(525)
			(179)

22	IAS 12	Recognition of deferred taxes on intercompany transfer of assets	386
	IAS 21	Change of functional and reporting currency to USD	(66)
			320

23	IFRS 2	Adjustment to fair value of share-based payments	249
	IAS 21	Change of functional and reporting currency to USD	(125)
			124

24	Various	Tax impact from adoption of other IFRS standards	507
	IAS12	Reclassification to long-term deferred asset	892
	IAS 21	Change of functional and reporting currency to USD	(1,075)
			324
25	Various


Reconciliation of Consolidated Statement of Income and Comprehensive Income for the three-month period ended October 31, 2009:
26	IAS 21	Change of functional and reporting currency to USD	All

27	IAS 2	Adjustment for unallocated overhead incurred in the quarter	156
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	1,898
	IFRS 2	Adjustment to fair value of share-based payments	64
	IAS 21	Change of functional and reporting currency to USD	(1,364)
			754

28	IAS 2	Adjustment for unallocated overhead incurred in the quarter	5
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	(40)
	IAS 21	Change of functional and reporting currency to USD	(249)
			(284)

29	IAS 2	Adjustment for unallocated overhead incurred in the quarter	(8)
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	130
	IFRS 2	Adjustment to fair value of share-based payments	50
	IAS 21	Change of functional and reporting currency to USD	(443)
			(271)

30	IFRS 2	Adjustment to fair value of share-based payments	130
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	9
	IAS 21	Change of functional and reporting currency to USD	(207)
			(68)

31	IAS 1	Reclassification of amortization	(2,521)
	IAS 21	Change of functional and reporting currency to USD	(738)
			(3,289)

32	IAS 1	Reclassification of foreign-exchange gains and losses	(752)
	IAS 21	Change of functional and reporting currency to USD	1,929
			1,177

33	Various


Reconciliation of Consolidated Balance Sheet as at January 31, 2010
34	IAS 21	Change of functional and reporting currency to USD	All

35	IAS 2	Adjustment for unallocated overhead incurred in the quarter	(222)
	IAS 21	Change of functional and reporting currency to USD	833
			611

36	Various	Tax impact from adoption of other IFRS standards	74
	IAS 12	Reclassification to long-term deferred asset	287
	IAS 21	Change of functional and reporting currency to USD	(371)
			(10)

37	IAS 12	Reclassification to long-term deferred asset	876
	IAS 21	Change of functional and reporting currency to USD	(460)
			416

38	IAS 36	Building and equipment amortization reduction of Henlow Bay CGU	235
	IAS 16	Componentization and change in useful lives	(12)
	IAS 36	Building and equipment amortization reduction of CBI Baltimore CGU	161
	IAS 21	Change of functional and reporting currency to USD	302
			686

39	IAS 12	Reclassification to long-term deferred asset	(60)
	Various	Tax impact from adoption of other IFRS standards	264
	IAS 12	Recognition of deferred tax on intercompany transfer of assets	(617)
	IAS 21	Change of functional and reporting currency to USD	367
			(46)

40	IAS 12	Recognition of deferred taxes on intercompany transfer of assets	321
	IAS 21	Change of functional and reporting currency to USD	572
			893

41	IFRS 2	Adjustment to fair value of share-based payments	(528)
	IAS 21	Change of functional and reporting currency to USD	(119)
			(647)

42	Various	Tax impact from adoption of other IFRS standards	82
	IAS 12	Reclassification to long-term deferred asset	815
	IAS 21	Change of functional and reporting currency to USD	(69)
			828
43	Various


Reconciliation of Consolidated Statement of Income and Comprehensive Income for the three-month period ended January 31, 2010:

44	IAS 21	Change of functional and reporting currency to USD	All

45	IAS 2	Adjustment for unallocated overhead incurred in the quarter	248
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	1,849
	IFRS 2	Adjustment to fair value of share-based payments	(136)
	IAS 21	Change of functional and reporting currency to USD	(1,650)
			312

46	IAS 2	Adjustment for unallocated overhead incurred in the quarter	20
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	(12)
	IAS 21	Change of functional and reporting currency to USD	(290)
			(282)

47	IAS 2	Adjustment for unallocated overhead incurred in the quarter	(47)
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	(6)
	IFRS 2	Adjustment to fair value of share-based payments	(113)
	IAS 21	Change of functional and reporting currency to USD	(87)
			(254)

48	IFRS 2	Adjustment to fair value of share-based payments	(287)
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	534
	IAS 21	Change of functional and reporting currency to USD	(551)
			(304)

49	IAS 1	Reclassification of amortization	(2,880)
	IAS 21	Change of functional and reporting currency to USD	(988)
			(3,868)

50	IAS 1	Reclassification of foreign-exchange gains and losses	(515)
	IAS 21	Change of functional and reporting currency to USD	393
			(122)

51	Various


Reconciliation of Consolidated Balance Sheet as at April 30, 2010
52	IAS 21	Change of functional and reporting currency to USD	All

53	IAS 2	Adjustment for unallocated overhead incurred in the quarter	(551)
	IAS 21	Change of functional and reporting currency to USD	2,368
			1,817

54	Various	Tax impact from adoption of other IFRS standards	182
	IAS 21	Change of functional and reporting currency to USD	(5)
			177

55	IAS 12	Reclassification to long-term deferred asset	(364)
	IAS 21	Change of functional and reporting currency to USD	249
			(115)

56	IAS 36	Building and equipment amortization reduction of Henlow Bay CGU	239
	IAS 16	Componentization and change in useful lives	(1)
	IAS 36	Building and equipment amortization reduction of CBI Baltimore CGU	178
	IAS 21	Change of functional and reporting currency to USD	57
			473

57	IAS 12	Reclassification to long-term deferred asset	135
	Various	Tax impact from adoption of other IFRS standards	45
	IAS 12	Recognition of deferred tax on intercompany transfer of assets	(253)
	IAS 21	Change of functional and reporting currency to USD	848
			775

58	IAS 12	Recognition of deferred taxes on intercompany transfer of assets	404
	IAS 21	Change of functional and reporting currency to USD	24
			428

59	IFRS 2	Adjustment to fair value of share-based payments	187
	IAS 21	Change of functional and reporting currency to USD	407
			594

60	Various	Tax impact from adoption of other IFRS standards	75
	IAS 12	Reclassification to long-term deferred asset	(228)
	IAS 21	Change of functional and reporting currency to USD	32
			(121)
61	Various


Reconciliation of Consolidated Statement of Income and Comprehensive Income for the three-month period ended April 30, 2010
62	IAS 21	Change of functional and reporting currency to USD	All


63	IAS 2	Adjustment for unallocated overhead incurred in the quarter	587
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	1,926
	IFRS 2	Adjustment to fair value of share-based payments	45
	IAS 21	Change of functional and reporting currency to USD	(2,009)
			549

64	IAS 2	Adjustment for unallocated overhead incurred in the quarter	20
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	(17)
	IAS 21	Change of functional and reporting currency to USD	(117)
			(114)

65	IAS 2	Adjustment for unallocated overhead incurred in the quarter	(47)
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	(23)
	IFRS 2	Adjustment to fair value of share-based payments	37
	IAS 21	Change of functional and reporting currency to USD	(131)
			(164)

66	IFRS 2	Adjustment to fair value of share-based payments	95
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	515
	IAS 21	Change of functional and reporting currency to USD	(195)
			415

67	IAS 1	Reclassification of amortization	(3,016)
	IAS 21	Change of functional and reporting currency to USD	(1,154)
			(4,170)

68	IAS 1	Reclassification of foreign-exchange gains and losses	(613)
	IAS 21	Change of functional and reporting currency to USD	3,979
			3,366

69	Various


Reconciliation of Consolidated Balance Sheet as at July 31, 2010
70	IAS 21	Change of functional and reporting currency to USD	All


71	IAS 2	Adjustment for unallocated overhead incurred in the quarter	918
	IAS 21	Change of functional and reporting currency to USD	(1,039)
			(121)

72	Various	Tax impact from adoption of other IFRS standards	(306)
	IAS 21	Change of functional and reporting currency to USD	(303)
			(609)

73	IAS 12	Reclassification to long-term deferred asset	522
	IAS 21	Change of functional and reporting currency to USD	322
			844

74	IAS 36	Building and equipment amortization reduction of Henlow Bay CGU	176
	IAS 16	Componentization and change in useful lives	(1)
	IAS 36	Building and equipment amortization reduction of CBI Baltimore CGU	132
	IAS 21	Change of functional and reporting currency to USD	280
			587

75	IAS 12	Reclassification to long-term deferred asset	(157)
	Various	Tax impact from adoption of other IFRS standards	(357)
	IAS 12	Recognition of deferred tax on intercompany transfer of assets	1,181
	IAS 21	Change of functional and reporting currency to USD	(975)
			(308)

76	IAS 12	Recognition of deferred taxes on intercompany transfer of assets	(1,130)
	IAS 21	Change of functional and reporting currency to USD	20
			(1,110)

77	IAS 19	Service award liability	97
	IAS 21	Change of functional and reporting currency to USD	(712)
			(615)

78	IFRS 2	Adjustment to fair value of share-based payments	(1,325)
	IAS 21	Change of functional and reporting currency to USD	(151)
			(1,476)

79	Various	Tax impact from adoption of other IFRS standards	55
	IAS 12	Reclassification to long-term deferred asset	365
	IAS 21	Change of functional and reporting currency to USD	(196)
			224

80	Various


Reconciliation of Consolidated Statement of Income and Comprehensive Income for the three-month period ended July 31, 2010:

81	IAS 21	Change of functional and reporting currency to USD	All

82	IAS 2	Adjustment for unallocated overhead incurred in the quarter	(575)
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	3,009
	IFRS 2	Adjustment to fair value of share-based payments	(338)
	IAS 21	Change of functional and reporting currency to USD	(16)
			2,080

83	IAS 2	Adjustment for unallocated overhead incurred in the quarter	(14)
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	246
	IAS 21	Change of functional and reporting currency to USD	(64)
			168

84	IAS 2	Adjustment for unallocated overhead incurred in the quarter	(370)
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	595
	IFRS 2	Adjustment to fair value of share-based payments	(276)
	IAS 21	Change of functional and reporting currency to USD	(195)
			(246)

85	IFRS 2	Adjustment to fair value of share-based payments	(691)
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	306
	IAS 19	Service award liability	96
	IAS 21	Change of functional and reporting currency to USD	(16)
			(306)

86	IAS 1	Reclassification of amortization	(3,055)
	IAS 21	Change of functional and reporting currency to USD	(596)
			(3,651)

87	IAS 1	Reclassification of loss on disposal of assets	(260)

88	IAS 1	Reclassification of foreign-exchange gains and losses	1,874
	IAS 21	Change of functional and reporting currency to USD	(3,167)
			(1,293)
89	Various


Reconciliation of Consolidated Balance Sheet as at October 31, 2010
90	IAS 21	Change of functional and reporting currency to USD	All

91	IAS 2	Adjustment for unallocated overhead incurred in the quarter	(612)
	IAS 21	Change of functional and reporting currency to USD	310
			(302)

92	IAS 12	Tax impact from adoption of other IFRS standards	192
	IAS 21	Change of functional and reporting currency to USD	(23)
			169

93	IAS 12	Reclassification to long-term deferred asset	878
	IAS 21	Change of functional and reporting currency to USD	(372)
			506

94	IAS 36	Building and equipment amortization reduction of Henlow Bay CGU	235
	IAS 16	Componentization and change in useful lives	(1)
	IAS 36	Building and equipment amortization reduction of CBI Baltimore CGU	91
	IAS 21	Change of functional and reporting currency to USD	172
			497

95	IAS 12	Reclassification to long-term deferred asset	(739)
	Various	Tax impact from adoption of other IFRS standards	(205)
	IAS 12	Recognition of deferred tax on intercompany transfer of assets	39
	IAS 21	Change of functional and reporting currency to USD	720
			(185)

96	IAS 12	Recognition of deferred taxes on intercompany transfer of assets	(62)
	IAS 21	Change of functional and reporting currency to USD	5
			(57)

97	IFRS 2	Adjustment to fair value of share-based payments	(662)
	IAS 21	Change of functional and reporting currency to USD	22
			(640)

98	Various	Tax impact from adoption of other IFRS standards	73
	IAS 12	Reclassification to long-term deferred asset	175
	IAS 21	Change of functional and reporting currency to USD	33
			281

99	Various


Reconciliation of Consolidated Statement of Income and Comprehensive Income for the three-month period ended October 31, 2010:
*100*	IAS 21	Change of functional and reporting currency to USD	All


*101*	IAS 2	Expense unallocated overhead incurred in the quarter	34
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	2,044
	IFRS 2	Adjustment to fair value of share-based payments	(164)
	IAS 21	Change of functional and reporting currency to USD	(713)
			1,201

*102*	IAS 2	Expense unallocated overhead incurred in the quarter	44
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	(28)
	IAS 21	Change of functional and reporting currency to USD	(155)
			(139)

*103*	IAS 2	Expense unallocated overhead incurred in the quarter	609
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	(44)
	IFRS 2	Adjustment to fair value of share-based payments	(135)
	IAS 21	Change of functional and reporting currency to USD	(183)
			247

*104*	IFRS 2	Adjustment to fair value of share-based payments	(344)
	IAS 1	Reclassification of amortization and foreign-exchange gains and losses	489
	IAS 21	Change of functional and reporting currency to USD	(210)
			(65)

*105*	IAS 1	Reclassification of amortization	(3,255)
	IAS 21	Change of functional and reporting currency to USD	(793)
			(4,048)

*106*	IAS 1	Reclassification of foreign-exchange gains and losses	(796)
	IAS 21	Change of functional and reporting currency to USD	456
			(340)

*107*	Various

About Cangene Corporation
Cangene is one of Canada's largest and earliest biopharmaceutical companies. It was founded in 1984 and is headquartered in Winnipeg, Manitoba. Cangene has approximately 800 employees in six locations across North America and its products are sold worldwide. It operates manufacturing facilities in Winnipeg, Manitoba and Baltimore, Maryland where it produces its own products and undertakes contract manufacturing for a number of companies. Cangene operates three U.S. and one Canadian plasma-collection facilities branded as Cangene Plasma Resources (www.cangeneplasma.com). In addition, it has a regulatory affairs, sales and corporate communications office in Toronto, Ontario.

Cangene is focused on developing therapeutics for infectious diseases, and the Company uses patented manufacturing processes to produce plasma-derived and recombinant therapeutic proteins. Cangene has four FDA and/or Health Canada-approved hyperimmune products. In addition, the Company has several more products in development at various stages. Three of Cangene's products have been accepted into the U.S. Strategic National Stockpile—botulism antitoxin (investigational product), anthrax immune globulin (investigational product) and a vaccinia immune globulin, a product that may be used to counteract certain complications that may arise from smallpox vaccination. Capitalizing on its drug manufacturing expertise, Cangene also operates a significant contract research and manufacturing business using the resources of Baltimore, Maryland-based Cangene bioPharma, Inc. (a wholly owned subsidiary; formerly Chesapeake Biological Laboratories, Inc.; www.cangenebiopharma.com). Cangene's website, www.cangene.com, includes product and investor information, including past news releases.

Cautionary Note Regarding Non-GAAP and non-IFRS Financial Measures
This news release may contain non-GAAP and non-IFRS financial measures. Terms by which non-GAAP and non-IFRS financial measures are identified include but are not limited to "net cash", "total assets", "sales" and other similar expressions. Non-GAAP and non-IFRS financial measures are used to provide management and investors with additional measures of performance. However, non-GAAP and non-IFRS financial measures do not have standard meanings prescribed by GAAP and/or IFRS and are not directly comparable to similar measures used by other companies. Please refer to the appropriate reconciliations of these non-GAAP and non-IFRS financial measures to measures prescribed by GAAP and/or IFRS.

Forward-looking and risk information
The reader should be aware that Cangene's businesses are subject to risks and uncertainties that cannot be predicted or quantified; consequently, actual results may differ materially from past results and those expressed or implied by any forward-looking statements. Factors that could cause or contribute to such risks or uncertainties include, but are not limited to: the regulatory environment including the difficulty of predicting regulatory outcomes; changes in the value of the Canadian dollar; the Company's reliance on a small number of customers including government organizations; the demand for new products and the impact of competitive products, service and pricing; availability and cost of raw materials, especially the cost, availability and antibody concentration in plasma; fluctuations in operating results; government policies or actions; progress and cost of clinical trials; reliance on key strategic relationships; costs and possible development delays resulting from use of legal, regulatory or legislative strategies by the Company's competitors; uncertainty related to intellectual property protection and potential costs associated with its defence; the Company's exposure to lawsuits; and other matters beyond control of management. Risks and uncertainties are discussed more extensively in the MD&A section of the Company's most recent annual report and annual information form, which are available on the Company's website or on SEDAR at www.sedar.com.

The preceding cautionary statements should be considered in connection with all written or oral statements, especially forward-looking statements, that are made by the Company or by persons acting on its behalf and in conjunction with its periodic filings with Securities Commissions, including those contained in the Company's news releases and most recently filed annual information form. Forward-looking statements can be identified by the use of words such as "expects", "plans", "will", "believes", "estimates", "anticipates", "intends", "may", "bodes" and other words of similar meaning (including negative and grammatical variations). Should known or unknown risks or uncertainties materialize, or should management's assumptions prove inaccurate, actual results could vary materially from those anticipated. The Company undertakes no obligation to publicly make or update any forward-looking statements, except as required by applicable law.

"Cangene" is a trademark belonging to Cangene Corporation.

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Manager, Corporate Communications

Investor Relations

CANGENE RECEIVES APPROVAL TO EARLY-ADOPT INTERNATIONAL FINANCIAL REPORTING STANDARDS

March 16, 2011