PEI Cannabis 2023 Annual Report

PRINCE EDWARD ISLAND CANNABIS MANAGEMENT CORPORATION Notes to Financial Statements Year Ended March 31, 2023

1. DESCRIPTION OF BUSINESS Prince Edward Island Cannabis Management Corporation (the "Corporation") is a wholly-owned Crown Corporation of the Province of Prince Edward Island and is responsible for the distribution and sale of adult use cannabis throughout Prince Edward Island. The head office is located at 3 Garfield Street in Charlottetown with four retail outlets located across the province. 102173 P.E.I. Inc. was incorporated as a private company under the Companies Act of Prince Edward Island on December 28, 2017. This company was dissolved when the Cannabis Management Corporation Act was proclaimed on August 20, 2018, at which time all property of 102173 P.E.I. Inc. became the property of the Corporation and the claims, rights, liabilities, obligations and privileges of 102173 P.E.I. Inc. were transferred to and became vested in the Corporation. 2. BASIS OF PRESENTATION The financial statements have been prepared in accordance with, and are in compliance with, International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). The principal accounting policies applied in the preparation of the financial statements are set out in Note 4. These financial statements were authorized for issuance by the Board of Directors on June 27, 2023. The Board of Directors have the power to amend the financial statements after issue. 3. BASIS OF MEASUREMENT The financial statements have been prepared on a historical cost basis and are presented in Canadian dollars, which is the functional currency of the Corporation. Cannabis Management Corporation Act These financial statements have been prepared in accordance with IFRS, issued and in effect as of March 31, 2023. The significant accounting policies used in the preparation of these financial statements are summarized below. An overview of the standards, amendments, and interpretations on the conversion to IFRS, those adapted in the current year, and those which are issued but not yet in effect are presented below. IAS 1 Presentation of Financial Statements On January 23, 2020, IASB issued amendments to paragraphs 69 to 76 of IAS 1 Presentation of Financial Statements to specify the requirements for classifying liabilities as current or non-current. The amendments to IAS 1 are required to be applied for annual periods beginning on or after January 1, 2023. The amendments must be applied retrospectively in accordance with IAS 8. Cash Cash is comprised of cash on hand and amounts on deposit with financial institutions. (continues) 4. SIGNIFICANT ACCOUNTING POLICIES Changes in accounting standards

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PEICMC 2022-2023 Annual Report

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