Offer to purchase CLEARNET.pdf - About TELUS

4. FINANCING COSTS
TELUS CORPORATION
(FORMERLY BCT.TELUS COMMUNICATIONS INC.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
December 31, 1999
1999 1998
(millions)
Interest on long-term debt ............................................ $169.2 $211.2
Other interest ..................................................... 30.5 18.3
Foreign exchange loss (gain) ........................................... (9.4) 8.5
190.3 238.0
Allowance for funds used during construction .............................. 1.6 5.9
$188.7 $232.1
5. INCOME TAXES
1999 1998
(millions)
Current .......................................................... $307.0 $438.0
Future .......................................................... (10.1) 81.5
$296.9 $519.5
A reconciliation of the statutory income tax rate to the effective income tax rate is as follows:
1999 1998
Basic federal and provincial statutory income tax rate .......................... 45.5% 45.2%
Non-deductible portion of amortization of acquired assets ....................... 0.5 .3
Non-taxable portion of gain on disposal of assets .............................. (0.6) (.9)
Other ............................................................. (1.1) .8
44.3 45.4
Large corporations tax ................................................. 1.3 .9
Effective rate per Consolidated Statement of Income ........................... 45.6% 46.3%
6. EXTRAORDINARY LOSS
In March 1998, BC TELECOM announced a change in accounting principles in response to the growing
competitiveness of the industry and the new regulatory requirements that took effect on January 1, 1998.
This change from regulated accounting practices to generally accepted accounting principles resulted in an
after-tax, extraordinary charge to earnings of $530.6 million. This charge comprised a write-down of
$489.0 million to property, plant and equipment and $41.6 million to eliminate deferred workforce
transformation costs and was consistent with similar steps taken previously by most Canadian and U.S.
telecommunications companies, including TELUS Corporation in 1997.
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