LIQUIDITY, CAPITAL RESOURCES AND DEFERRED REVENUE 

Cash and Marketable Securities 

• The increase was primarily due to $167.1 million in cash from operations in 2005.
  
• Cash was used to pay two dividends of $0.20 per common share, and two dividends of $0.25 per common share, or $61.2 million in aggregate in 2005. 
  
  

Total Assets 

• Total Assets increased by $395.9 million due to higher energy contracts receivables of $1,004.3 million at the end of 2005 related to the clearing operations of NGX compared with $608.4 million at the end of 2004. (As the clearing counterparty to every trade, NGX also carries offsetting liabilities in the form of energy contracts payables, which were $1,004.3 million at the end of 2005 compared with $607.5 million at the end of 2004). 
  
• Total Assets also increased as a result of increased cash and marketable securities, accounts receivable and the long-term portion of the future tax asset.
  
  

Deferred Revenue – Initial and Additional Listing Fees 

• Deferred revenue - initial and additional listing fees increased as the fees received from initial and additional listings during this period were higher than the amount of revenue recognized for these fees related to prior periods. 
  
• Before we adopted EIC-141, there was no deferred revenue related to initial listing fees and additional listing fees. This deferred revenue represents non-refundable initial and additional listing fees received from listed issuers, and is recognized on a straight line basis over an estimated service period of ten years.
  
• The estimated service period of ten years was determined by conducting an historical review of listing activity. We determined that the average period of time that an issuer remained listed on Toronto Stock Exchange was approximately ten years. In addition, turnover rates were calculated for a Toronto Stock Exchange listed issuer and for a TSX Venture Exchange listed issuer, and were determined to be in the range of ten to twelve years. Examining historical data allowed us to consider the impact of economic cycles and other trends in capital markets over time. The service period selected affects the rate at which deferred revenue is recognized, as well as the future tax asset related to these fees.