[in thousands of Canadian dollars, except per share amounts] 

December 31, 2012 and 2011 

CI Financial Corp. [“CI”] is incorporated under the laws of the Province of Ontario. CI’s primary business is the management and distribution of a broad range of financial products and services, including mutual funds, segregated funds, fi nancial planning, insurance, investment advice, wealth management and estate and succession planning. 

## 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 

These consolidated financial statements of CI have been prepared in accordance with International Financial Reporting Standards [“IFRS”] as issued by the International Accounting Standards Board [“IASB”]. 

These consolidated financial statements were authorized for issuance by the Board of Directors of CI on February 14, 2013. 

## Basis of presentation 

The consolidated financial statements of CI have been prepared on a historical cost basis, except for certain fi nancial instruments that have been measured at fair value. The consolidated fi nancial statements have been prepared on a going concern basis. CI’s presentation currency is the Canadian dollar. The functional currency of CI and its subsidiaries is also the Canadian dollar. 

## Basis of consolidation 

The consolidated financial statements include the accounts of CI, CI Investments Inc. [“CI Investments”] and Assante Wealth Management (Canada) Ltd. [“AWM”] and their subsidiaries, which are entities over which CI has control. Control exists when CI has the power, directly or indirectly, to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Hereinafter, CI and its subsidiaries are referred to as CI. 

## Revenue recognition 

Revenue is recognized to the extent that it is probable that economic benefits will flow to CI and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received or receivable. In addition to these general principles, CI applies the following specific revenue recognition policies: 

Management fees are based upon the net asset value of the funds managed by CI and are recognized on an accrual basis. 

Administration fees and other income are recognized as services are provided under contractual arrangements. Administration fees include commission revenue, which is recorded on a trade date basis and advisory fees, which are recorded when the services related to the underlying engagements are completed. 

Redemption fees payable by securityholders of deferred sales charge mutual funds, the sales commission of which was financed by CI, are recognized as revenue on the trade date of the redemption of the applicable mutual fund securities. 

