Orbit Garant 2012 annual rep O rt 57 18 RELATED PARTY TRANSACTIONS The company is related to 28673820 Quebec inc a company owed by a director The Company was related to 6483976 Canada Inc Usinage XSPEC until January 31 2011 due to the signifcant infuence exercised by the company During the year the Company entered into the following transactions with its related companies June 30 June 30 2012 2011 Sales 6483976 Canada Inc 47 Purchases 6483976 Canada Inc 1267 Rent 28673820 Quebec inc 20 95 All of these related party transactions are measured at fair value 19 KEY MANAGEMENT PERSONNEL COMPENSATION The remuneration recognized for key management remuneration and directors fees are analyzed as follows June 30 June 30 2012 2011 Salaries and fees 1422 1229 Sharebased compensation 708 988 2130 2217 20 FINANCIAL INSTRUMENTS The Company is exposed to various risks related to its fnancial assets and liabilities There have been no substantive changes in the Companys exposure to fnancial instrument risks its objectives policies and processes for managing those risks or the methods used to measure them from previous years unless otherwise stated in this note Currency risk The Company realizes a part of its activities in US dollars and is thus exposed to foreign exchange fuctuations The Company does not actively manage this risk As at June 30 2012 the Company has cash in US dollars for an amount of 935 June 30 2011 296 July 1 2010 228 and accounts receivable in US dollars for an amount of 2195 June 30 2011 388 July 1 2010 516 As at June 30 2012 the Company has estimated that a 10 increase or decrease of the US exchange rate would have caused a corresponding annual increase or decrease in net earnings and comprehensive earnings of approximately 193 June 30 2011 18 Credit risk The Company provides credit to its customers in the normal course of its operations The Company has adopted a policy of only dealing with creditworthy counterparties and obtaining suffcient collateral where appropri ate as a means of mitigating the risk of fnancial loss from defaults It carries out on a continuing basis credit checks on its customers and maintains provisions for contingent credit losses Demand for the Companys drilling services depends upon the level of mineral exploration and development activities conduc ted by mining companies particularly with respect to gold nickel and copper In order to reduce the credit risk the Company is using insurance coverage from Export Development Canada EDC on certai n accounts receivable from its customers The insurance program provides under certain terms and conditions an insurance c overage amount of up to 90 of unpaid accounts As at June 30 2012 the amount of the insurance coverage from EDC represents approximately 24 of the accounts receivable 33 in June 30 2011 53 in July 1 2010 The carrying amounts for accounts receivable are net of allowances for doubtful accounts which are estimated based on aging analysis of receivables past experience specifc risks associated with the customer and other rel evant information The maximum exposure to credit risk is the carrying value of the fnancial assets