Genome Canada Notes to the financial statements March 31, 2017 (in thousands of dollars) Page 5 1. Description of the business Genome Canada (the “Corporation”) was incorporated on February 8, 2000 under the Canada Corporations Act and continued on December 11, 2012. The Corporation is a not-for-profit organization and has the following objectives: a) The development and establishment of a co-ordinated strategy for genomics research to enable Canada to become a world leader in areas such as health, agriculture, environment, forestry, fisheries, mining and energy; b) The provision of leading-edge technology to researchers in all genomics-related fields through regional Genome Centres across Canada, of which there are currently six, one each in British Columbia, Alberta, the Prairies, Ontario, Quebec and the Atlantic; c) The support of large-scale projects of strategic importance to Canada by bringing together industry, government, universities, research hospitals and the public; d) The assumption of leadership in the area of ethical, environmental, economic, legal, social and other issues related to genomics research, and the communication of the relative risks, rewards and successes of genomics to the Canadian public; and e) The encouragement of investment by others in the field of genomics research. 2. Significant accounting policies The financial statements have been prepared in accordance with Canadian accounting standards for not-for-profit organizations and include the following significant accounting policies: Revenue recognition The Corporation follows the deferral method of accounting for contributions received from the Government of Canada. Externally restricted contributions and related investment income are recognized as revenue in the year in which the underlying expenses are incurred. A receivable is recognized if the amount to be received can be reasonably estimated and collection is reasonably assured. Externally restricted contributions for purchase of capital assets are deferred and amortized to revenues on a declining-balance basis at a rate corresponding to the amortization rate for the related capital assets. Cash and cash equivalents Cash and cash equivalents consist of cash as well as highly liquid short-term investments. The Corporation considers highly liquid short-term investments as those having a maturity of less than three months from the date of acquisition. Cash and cash equivalents are recorded at fair value. Investments Investments are recorded at fair value. Fair value is determined at quoted market prices. Sales and purchases of investments are recorded at the settlement date. Transaction costs related to the acquisition of investments are expensed. Financial instruments The Corporation records interest and other receivable and accounts payable and accrued liabilities at amortized cost using the effective interest method of amortization.