MANAGEMENT’S DISCUSSION  AN D ANALYSIS 2013 Financial Report 89 Consolidated S tatements of Income 90 Consolidated S tatements of Comprehensive Income 91 Consolidated S tatements of Financial Position 92 Consolidated S tatements of Changes in S hareholders’ Equity 93 Consolidated S tatements of Cash Flows 94 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 94 Note 1: Nature of the Business 94 Note 2: Significant Accounting Policies 102 Note 3: Segmented Information 103 Note 4: Operating Costs 103 Note 5: Finance Costs 103 Note 6: Discontinued Operations 104 Note 7: Business Combinations 105 Note 8: Restructuring, Acquisition and Other Expenses 106 Note 9: Income Taxes 107 Note 10: Earnings Per Share 107 Note 11: Other Current Assets 107 Note 12: Property, Plant and Equipment 108 Note 13: Goodwill and Intangible Assets 109 Note 14: Investments 110 Note 15: Other Long-Term Assets 110 Note 16: Accounts Receivable Securitization 110 Note 17: Provisions 111 Note 18: Long-Term Debt 112 Note 19: Capital Risk Management 113 Note 20: Financial Risk Management and Financial Instruments 117 Note 21: Other Long-Term Liabilities 118 Note 22: Pensions 120 Note 23: Shareholders’ Equity 121 Note 24: Stock Options, Share Units and Share Purchase Plans 122 Note 25: Related Party Transactions 123 Note 26: Guarantees 124 Note 27: Commitments and Contingent Liabilities 125 Note 28: Subsequent Events 24 MANAGEMENT’S DISCUSSION AND ANALYSIS 88 MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL REPORTING 88 INDEPENDENT AUDITORS’ REPORT OF REGISTERED PUBLIC ACCOUNTING FIRM 89 CONSOLIDATED FINANCIAL STATEMENTS 26 Executive S ummary 26 About Rogers Communications Inc. 27 2013 Highlights 29 Understanding Our Business 30 Our Strengths 31 Industry Trends 32 Our Strategy 33 Financial and Operating Guidance 34 2013 Financial Results 34 Summary of Consolidated Results 35 Key Highlights 36 Key Changes in Financial Results This Year Compared to 2012 37 Wireless 41 Cable 45 Business Solutions 47 Media 50 Additions to Property, Plant and Equipment 51 Review of Consolidated Performance 54 Quarterly Results 57 Balance Sheet Overview 58 Managing Our Liquidity and Financial Resources 58 Sources and Uses of Cash 61 Financial Condition 62 Financial Risk Management 65 Dividends and Share Information 66 Commitments and Other Contractual Obligations 66 Off-Balance Sheet Arrangements 67 Regulation in Our Industry 71 G overnance and Risk Management 71 Governance at Rogers 72 Risk Management 74 Risks and Uncertainties Affecting Our Business 78 Controls and Procedures 79 Other Information 79 Accounting Policies 82 Key Performance Indicators 84 Additional GAAP Measures 84 Non-GAAP Measures 87 Five-Year Summary of Consolidated Financial Results 86 Summary of Financial Results of Long-Term Debt Guarantor 2013 ANNUAL REPORT ROGERS COMMUNICATIONS INC. 23