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An updates milwaukee brewers implementationteam is brewers sausages uncovers working closely with senior management in a number of differentbusiness areas to ensure that the impacts of the conversion throughoutthe business are managed in a timely and efficient manner. A steeringcommittee has been established to oversee the project.Process and TimingThe process of converting to IFRS has been divided into a number ofdifferent stages, many of which will run concurrently. A detailedanalysis is scheduled to be completed early in the third quarter. Variousaccounting policy choices have been identified to date and are beingconsidered by the steering committee.Any changes required to systems and controls (including informationtechnology systems) will be identified as the project progresses; theseare currently projected to be designed and tested by the end of thefourth quarter of 2009.
The Partnership intends to convertto these new standards according to the timetable set for these new rules.The Partnership has completed the planning and high level diagnosisactivities of its transition plan brew crew ball . On an ongoing basis, management reviews itsestimates, including those related to asset useful lives foramortization, impairment of long-lived assets, pension and other employeefuture benefit plans, asset retirement obligations, and provisions forinsurance claims, based upon currently available information corey hart brewers . While it isreasonably possible that circumstances may arise which cause actualresults to differ from these estimates, management does not believe it islikely that any such differences will materially affect the Partnership'sfinancial condition.CONVERSION TO INTERNATIONAL FINANCIAL REPORTING STANDARDSOn February 13, 2008, the Accounting Standards Board announced thatpublicly accountable entities will be required to prepare financialstatements in accordance with International Financial Reporting Standards(IFRS) for interim and annual financial statements for fiscal yearsbeginning on or after January 1, 2011 baseball tickets . Net income (loss) is also impactedby fluctuations in the Canadian dollar exchange rate, market price ofnatural gas, the revaluation to the period end rate of US dollardenominated working capital balances and long-term debt, and revaluationof outstanding natural gas commodity swaps and US dollar forward salescontracts.CRITICAL ACCOUNTING ESTIMATESThe preparation of financial statements in conformity with Canadiangenerally accepted accounting principles requires management to makeestimates and assumptions that affect the amounts recorded in thefinancial statements brew crew t shirt . Operatingincome (loss), net income (loss) and EBITDA are primarily impacted by thelevel of sales, freight costs and fluctuations of fibre, chemicals andenergy prices, level of spending and the timing of scheduled maintenancedowntime, and production curtailments. The Partnershipremained in compliance with all covenants at June 30, 2009, and believesit will remain in compliance with all covenants for the balance of 2009based on current forecasts.
The Partnership also reviews on an ongoing basis,the level of distributions, capital expenditures and timing of scheduledmajor maintenance outages and may adjust these periodically to managecash resources.The Partnership also utilizes discounting of letters of credit onoutstanding trade receivables to reduce borrowing costs, to reduce creditand foreign currency exposure, and to increase short-term liquidity.The agreements covering the Revolving Facility and the long term Notescontain similar financial covenants including four quarter trailingmaximum allowable debt to EBITDA leverage ratio of 3.25 and minimumrequired EBITDA to interest coverage ratio of 2.5 brewers sausage race . The Partnershipexpects to renew the Revolving Facility for a similar amount, with termsand interest rates based on prevailing market conditions at the time ofrenewal.The Partnership manages cash resources to fund current and futureoperations through management of its capital structure in conjunctionwith cash flow forecasting including anticipated investing and financingactivities, and use of the Revolving Facility to meet short-term workingcapital requirements brewers sausages . The Partnership has a $75 millionsyndicated unsecured revolving bank credit facility (the RevolvingFacility), maturing in November 2009, of which $35.2 million isavailable, with $24.7 million of the Revolving Facility reserved forstandby letters of credit issued to BC Hydro and $15.1 million drawn tofund working capital requirements as of June 30, 2009 corey hart brewers . Totalproperty damage insurance proceeds recorded as a non-operating gain inthe second quarter of 2009 were $0.2 million.Final payment received in the second quarter of 2009 was $8.2 million, ofwhich $6.8 million related to the business interruption insurance and$1.4 million to property damage, of which $0.3 million has beenclassified as an investing activity on the cash flow statement, with thebalance of $1.1 million representing demolition costs.LIQUIDITY AND FINANCIAL REQUIREMENTSAt the end of the current quarter, the Partnership had cash and cashequivalents of $18.3 million . Paperfinished goods and wood chip inventories were also reduced from thebeginning of the year. Total business interruption insuranceaccrued and received was $25.6 million, which is net of a 3-dayequivalent deductible of $1.0 million.
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