88 Company produced programs are recorded at cost, including direct pro- duction costs and an appropriate share of overhead. These costs are included in program rights and are fully amortized as played, over a maximum period of three years. Any revenue earned relating to the sale of these programs is recorded as pro- gram distribution revenue over the term of the related sales contracts. Amortization of program and film rights is included in operating, general and administrative expenses and has been disclosed separately in the consolidated statements of cash flows. Film investments are recorded at cost. The individual film forecast computation method is used to amortize film costs. Amortization for each film is calculated based on the ratio of current revenues to total estimated revenues. As the estimating process is affected by uncertainties as to future film revenues, cost is often used as the initial film revenue estimate. Estimates of future revenues and net realizable val- ues are reviewed on a regular basis. If it is determined that future revenues are insufficient to recover net carrying amount, a film investment is reduced to its net realizable value. Amortization of film investments is included in operating, general and administrative expenses. Financing costs and credit facility arrangements are amortized to income over the term of the debt facility. Start-up costs for the preparation of new applications to the CRTC are deferred prior to approval by the CRTC. The costs associated with unsuccessful appli- cations are expensed. Start-up costs for licenses of successful applications which are awarded by the CRTC are capitalized from the date they are awarded to the date rev- enue is generated for the service. Start-up costs are amortized over a period which reflects their expected future benefit, not exceeding the term of the licenses. Deferred Charges Film Investments