Subordinated Debt  Deposits In determining the fair value of our deposits, we incorporate the following assumptions: The fair value of our subordinated debt is determined by referring to current market prices for similar debt instruments. Set out below is a comparison of the amounts which would be repor ted if all of our financial instrument assets and liabilities  were reported at their fair values: ALM — asset/liability management derivatives which we use to manage the interest rate and foreign exch ange exposures arising from our on-balance sheet positions. We prepare our consolidated financial statements in accordance with generally accepted accounting principles (GLYPH<210>GAAPGLYPH<211>) in Canada, including the accounting requirements of our regulator, the Superintendent of Financial Institutions Canada. Set out below are the more significant differences which would result if United States generally accepted accounting principles were applied in the preparation of our consolidated financial statements. Certain comparative figures have been reclassified to conform with the current yearGLYPH<213>s presentation. Condensed Consolidated Balance Sheet NOTE 25 Reconciliation of Canadian and United States Gener ally Accepted Accounting Principles b For fixed rate, fixed maturity deposits, we discount the remaining contractual cash flows for these deposits at market interest rates currently offered for deposits with similar terms and risks. b For floating rate, fixed maturity deposits, changes in interest rates have minimal impact on fair value as the deposits reprice  to market frequently. On that basis, fair value is assumed to equal book value. b For deposits with no defined maturities, we consider fair value to equal book value based on book value being equivalent to the amount payable on the reporting date. 2002 2001 Fair value  Fair value  Fair value Fair value  Fair value Fair value  Book of assets and of ALM over (under) Book of assets and of ALM over (under) value liabilities hedges book value value liabilities hedges book value Assets Cash resources $ 19,305 $ 19,305 $  — $  — $ 17,656 $ 17,656 $ — $ — Securities (Note 3) 43,715 44,036 (344) (23) 37,676 37,920 (368) (124) Loans 142,695 142,971 48 324 136,829 137,310 67 548 CustomersGLYPH<213> liability under acceptances 6,901 6,901 — — 7,936 7,936 — — Other assets 38,089 38,089 — — 37,142 37,142 — — 250,705 251,302 (296) 301 237,239 237,964 (301) 424 Liabilities Deposits 161,838 162,628 (546) 244 154,290 155,390 (588) 512 Acceptances 6,901 6,901 — — 7,936 7,936 — — Securities sold but not yet purchased 7,654 7,654 — — 6,609 6,609 — — Securities sold under repurchase agreements 24,796 24,796 — — 17,480 17,480 — — Other liabilities 35,987 35,987 — — 37,738 37,738 — — Subordinated debt 3,794 4,145 (4) 347 4,674 5,018 (2) 342 $ 240,970 $ 242,111 $  (550) $  591 $ 228,727 $ 230,171 $ (590) $ 854 Total $ (290) $ (430) As at October 31 (Canadian $ in millions) 2002 2001 Canadian Increase United States Canadian Increase United States GAAP (Decrease) GAAP GAAP (Decrease) GAAP Assets Cash Resources $ 19,305 $ — $ 19,305 $ 17,656  $ — $ 17,656 Securities 43,715 2,779 (6) 46,494 37,676 1,092 (6) 38,768 Loans, net of the allowance for credit losses 142,695 3 142,698 136,829 5 136,834 Other 47,149 256 47,405 47,248 287 47,535 Total Assets $ 252,864 $ 3,038 $ 255,902 $ 239,409  $ 1,384 $ 240,793  Liabilities and ShareholdersGLYPH<213> Equity Deposits $ 161,838 $  66 $ 161,904 $ 154,290  $ (20) $ 154,270  Other Liabilities 75,338 2,582 (6) 77,920 69,763 985 (6) 70,748 Subordinated Debt 3,794 87 3,881 4,674 150 4,824 ShareholdersGLYPH<213> Equity (1) 11,894 303 (8) 12,197 10,682 269 (8) 10,951 Total Liabilities and ShareholdersGLYPH<213> Equity $ 252,864 $ 3,038 $ 255,902 $ 239,409  $ 1,384  $ 240,793  BMO FINANCIAL GROUP ANNUAL REPORT 2002 91