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## 16. United States Accounting Principles 

## Earnings and Comprehensive Income 

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The tax rate reductions that are substantially enacted in Canada, amounting to $92.8 million would not meet the requirements for enactment under U.S. GAAP. 

The deferred income taxes related to the unbundling transaction and charged to retained earnings under Canadian GAAP as part of the adoption of the new income tax standards, are charged to earnings as a write-down of the regulatory asset, under U.S. GAAP. 

Basic and fully diluted earnings per share applicable to common shareholders under U.S. GAAP for the year ended December 31, 2000 were $1.36 (1999 — $1.91; 1998 — $1.66). 

At December 31, 2000, accumulated other comprehensive income consisted solely of an accumulated foreign currency translation adjustment of $14.3 million (1999 — $(1.9) million). 

## Financial Position 

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Under U.S. GAAP, the Company’s Preferred Securities and related distributions would be recognized as debt and interest expense, respectively. The carrying amount of the equity component, when classified as long-term debt under U.S. GAAP, has a fair market value of $343.6 million at December 31, 2000 (1999 — $326.8 million). 

Under U.S. GAAP, deferred income tax liabilities are recorded for regulated operations which follow the taxes payable method. As these deferred income taxes are recoverable through future revenues, a corresponding deferred asset is also recorded. These assets and liabilities reflect changes in enacted income tax rates. The additional deferred taxes under U.S. GAAP include the difference between capital cost allowance and depreciation of property plant and equipment of $638.7 million (1999 — $743.3 million) and the incremental revenue required for the recovery of unrecorded taxes of $479.5 million (1999 — $598.4 million). 

Under U.S. GAAP, the Company’s investments in joint ventures are accounted for using the equity method. 

