2008 McGRAW-HILL RYERSON AnnuAl RepoRt

The following table sets forth the age of trade receivables that are not overdue as well as an analysis of overdue amounts:As at December 31, 2008 2007Not overdue 84% 88%Past due for more than one day but not more than three months 14% 11%Past due for more than three months 2% 1%The Company's five largest customers make up approximately29% [2007 - 33%] of the accounts receivable balance andapproximately 14% [2007 - 14%] of net sales.Liquidity risk arises through the excess of financial obligationsover available financial assets due at any point in time.The Company’s objective in managing liquidity risk is to maintainsufficient readily available reserves in order to meet its liquidityrequirements at any point in time. The Company achieves thisby maintaining sufficient cash and cash equivalents and throughthe availability of funding from committed credit facilities. As atDecember 31, 2008, the Company was holding cash and cashequivalents of $43,856 and had undrawn lines of credit availableto it of $6,500. As the majority of the Company’s cash and cashequivalents are held by one bank in Canada there is a concentrationof credit risk. This risk is managed by performing a periodicreview of the credit status of our financial institution.Interest rate risk primarily arises from certain cash equivalentsheld at the bank. These financial assets held to maturity asat the end of the year are $35,000 [2007 - $26,000] and interestincome earned on these investments in the year ended is $698[2007 - $607]. The income earned on these cash equivalents is11 SEGMENTED DISCLOSUREThe Company is structured on a market-focus basis and operatesin three primary market areas: post-secondary education,including universities and community colleges, and proprietarycolleges ["Higher Education"]; secondary and elementary schools["School"] and trade, professional and medical, including retailers,distributors, libraries, non-traditional booksellers, directsubject to the movements in interest rates. The terms of theinvestments are between 30 and 60 days. A +/-1% change ininterest rates would, everything else being equal, have an effecton the income before income taxes for the year ended December31, 2008 of approximately +/- $220.Capital risk managementThe Company manages its capital to safeguard the entity's abilityto continue as a going concern, so that it can continue to providereturns for shareholders and benefits for other stakeholders. TheCompany’s strategy remains unchanged from 2007.The capital structure of the Company consists of shareholders’equity comprising issued capital and retained earnings. TheCompany manages the capital structure and makes adjustmentsto it in the light of changes in economic conditions and the riskcharacteristics of the underlying assets. In order to maintain oradjust the capital structure, the Company may adjust the amountof dividends paid to shareholders or return capital to shareholders.Such decisions are currently influenced by the amount ofcash and cash equivalents held by the Company as well as forecastedfuture cash requirements.marketing and the medical sector ["Professional"]. Included inWarehouse, Support & Other’s Sales, less returns are freightcharged to customers and sales to French institutions mostly inQuebec. The accounting policies of these operating segmentsare the same as those described in the summary of significantaccounting policies.McGraw-Hill Ryerson Annual Report 2008272008HigherEducation School ProfessionalWarehouse,Support & OtherSales, less returns 53,347 27,973 8,727 1,438 91,485Amortization –pre-publication costsAmortization –capital assetsIncome (loss) beforeincome taxesTotal2,874 3,332 — — 6,20669 37 11 1,232 1,34916,950 9,697 1,421 (12,160) 15,908Provision for income taxes — — — 5,406 5,406Total expenditures foradditions to capital asset— 22 11 117 150Segment assets 19,397 15,183 3,411 15,891 53,882