Exhibit 99.2

Financial Statements

Sirius Canada Inc.

November 30, 2010

AUDITORS' REPORT

To the Directors of

Sirius Canada Inc.

We have audited the balance sheet of Sirius Canada Inc. as at November 30, 2010 and the statements of operations and comprehensive income, changes in shareholders' deficiency and cash flows for the period from January 1, 2010 to November 30, 2010. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.

In our opinion, these financial statements present fairly, in all material respects, the financial position of the Company as at November 30, 2010 and the results of its operations and its cash flows for the year then ended in accordance with Canadian generally accepted accounting principles.

“Ernst & Young LLP”

Chartered Accountants

Licensed Public Accountants

Toronto, Canada,

May 31, 2011.

Sirius Canada Inc.

BALANCE SHEET
[Expressed in Canadian dollars]

As at

	November 30,			December 31,
	2010			2009
		$			$

ASSETS
Current
Cash and cash equivalents		47,610,454			24,677,367
Accounts receivable, net		8,652,620			12,829,792
Prepaid expenses		1,918,196			1,520,476
Inventory [note 5]		1,409,832			598,488
Total current assets		59,591,102			39,626,123
Property and equipment, net [notes 4 and 6]		2,636,352			3,552,764
Intangible assets, net [notes 4 and 7]		4,415,866			3,037,628
Other assets		36,720			36,720
		66,680,040			46,253,235

LIABILITIES AND SHAREHOLDERS' DEFICIENCY
Current
Accounts payable		4,240,897			6,979,976
Accrued liabilities		28,082,303			22,453,432
Due to related parties [notes 1 and 4]		19,836,681			15,806,771
Future tax liability [note 12]		1,133,756			914,140
Deferred revenue		79,892,903			75,748,514
Deferred leasehold inducement		42,890			42,890
Total current liabilities		133,229,430			121,945,723
Deferred revenue		12,710,409			16,408,547
Deferred leasehold inducement		200,156			239,472
Total liabilities		146,139,995			138,593,742
Commitments [notes 4 and 11]

Shareholders' deficiency
Share capital [note 8]		36,000,100			36,000,100
Accumulated deficit		(115,460,055	)		(128,340,607	)
Total shareholders' deficiency		(79,459,955	)		(92,340,507	)
		66,680,040			46,253,235

See accompanying notes

On behalf of the Board:

Director

Sirius Canada Inc.


STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME
[Expressed in Canadian dollars]





	Period from
	January 1 to		Year ended
	November 30,		December 31,
	2010		2009
		$		$

REVENUE
Broadcasting		141,347,218		133,467,044
Equipment		932,238		813,252
		142,279,456		134,280,296
EXPENSES
Cost of service [notes 4, 5 and 11]		43,012,798		33,668,817
Sales and marketing [note 4]		67,305,927		75,357,232
Information and technology [note 4]		5,255,819		5,588,710
General and administrative [notes 4 and 11]		8,656,669		4,220,126
Foreign exchange loss		92,245		296,619
Amortization [notes 6 and 7]		2,407,024		2,353,222
		126,730,482		121,484,726
Net income before interest income		15,548,974		12,795,570
Interest income [note 9]		186,592		177,498
Net income and comprehensive income for the period		15,735,566		12,973,068

See accompanying notes

Sirius Canada Inc.


STATEMENT OF CHANGES IN SHAREHOLDERS' DEFICIENCY
[Expressed in Canadian dollars]





																	Accumulated
												Total					other		Total
	Common shares											common		Accumulated			comprehensive		shareholders’
	Class A				Class B				Class C			shares		deficit			income		deficiency
		#	$			#	$			#	$		$		$			$		$
	[note 8]

Balance, December 31, 2008		6,262		63		3,738		37		3,600,000	36,000,000		36,000,100		(138,236,716	)		-		(102,236,616	)
Dividends [note 8]		-		-		-		-		-	-		-		(2,844,000	)		-		(2,844,000	)
Net income for the year		-		-		-		-		-	-		-		12,973,068			-		12,973,068
Part VI.1 tax [note 12]		-		-		-		-		-	-		-		(232,959	)		-		(232,959	)
Balance, December 31, 2009		6,262		63		3,738		37		3,600,000	36,000,000		36,000,100		(128,340,607	)		-		(92,340,507	)
Dividends [note 8]		-		-		-		-		-	-		-		(2,635,397	)		-		(2,635,397	)
Net income for the period		-		-		-		-		-	-		-		15,735,566			-		15,735,566
Part VI.1 tax [note 12]		-		-		-		-		-	-		-		(219,617	)		-		(219,617	)
Balance, November 30, 2010		6,262		63		3,738		37		3,600,000	36,000,000		36,000,100		(115,460,055	)		-		(79,459,955	)

See accompanying notes

Sirius Canada Inc.


STATEMENT OF CASH FLOWS
[Expressed in Canadian dollars]





	Period from
	January 1 to			Year ended
	November 30,			December 31,
	2010			2009
		$			$

OPERATING ACTIVITIES
Net income for the period		15,735,566			12,973,068
Add item not involving cash
Amortization		2,407,024			2,353,222
Net change in non-cash working capital balances related to operations [note 9]		6,975,199			(25,787,697	)
Cash provided by (used in) operating activities		25,117,789			(10,461,407	)

INVESTING ACTIVITIES
Purchase of property and equipment		(84,686	)		(310,627	)
Purchase of intangible assets		(2,100,016	)		(907,034	)
Cash used in investing activities		(2,184,702	)		(1,217,661	)

Net increase (decrease) in cash during the year		22,933,087			(11,679,068	)
Cash and cash equivalents, beginning of year		24,677,367			36,356,435
Cash and cash equivalents, end of year		47,610,454			24,677,367

See accompanying notes

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

1. NATURE OF BUSINESS

Sirius Canada Inc. ["Sirius Canada" or the "Company"] was incorporated in July 2004 under the Canada Business Corporations Act and is a provider of satellite radio in Canada.

The Company's principal shareholders are the Canadian Broadcasting Corporation ["CBC"], 40% voting ownership; Slaight Communications Ltd. ["Slaight"], 40% voting ownership; and Sirius XM Radio Inc. ["Sirius XM"], 20% voting ownership. The Company broadcasts its signal through proprietary satellite network and uplink. Subscribers receive a radio signal through satellite radios which are factory installed by the Company's OEM partners and sold at consumer electronics retailers. The Company is dependent upon Sirius XM to provide ongoing proprietary satellite network and uplink.

The Company has a single operating segment and all of the Company's property and equipment and intangible assets are located in Canada.

The Company's Board of Directors approved a change in the Company's fiscal year end from December 31 to November 30, effective 2010. As a result of this change, the Company is reporting results for the period from January 1, 2010 to November 30, 2010.

On November 24, 2010, the Company and each of the shareholders [the "Vendors"] entered into a Purchase Agreement with Canadian Satellite Radio Holdings Inc. ["CSR"]. The Purchase Agreement sets out the terms and conditions relating to the acquisition of all of the issued and outstanding shares of the Company by CSR [the "transaction"]. As part of the consideration for such acquisition, CSR will issue to the Vendors a combination of Class A shares and Class B shares in CSR that is equivalent to 71,284,578 Class A shares in CSR. In the event that CSR's total cash, cash equivalents and restricted investments balance is less than $9,000,000 at the closing of the transaction, each of the Vendors shall receive non-interest bearing promissory notes for the difference between the actual cash balance and $9,000,000. In accordance with Canadian generally accepted accounting principles ["GAAP"], management has determined that the Company is the accounting acquirer and will be accounting for this transaction upon closing as a reverse takeover using the purchase method of accounting. This basis of accounting reflects the combination as a continuation of the financial statements of the Company adjusted for the legal capital of CSR.

In conjunction with the implementation of the transaction, a number of steps will be undertaken between the shareholders which will result in direct and indirect cash payments of a capital nature to the shareholders on closing.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

The closing of the transaction is conditional upon approval by CSR's shareholders, the competition bureau, the Toronto Stock Exchange and the Canadian Radio-television and Telecommunications Commission ["CRTC"], the CBC receiving an Order in Council, and a refinancing of CSR's existing senior notes for new unsecured senior notes. The merger is expected to close in the second calendar quarter of 2011.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

These financial statements have been prepared by management in accordance with Canadian GAAP. The significant accounting policies are as follows:

Use of estimates

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosure of contingent assets and liabilities. On an ongoing basis, the Company evaluates its estimates, including those related to the valuation of accounts receivable and other receivables, accounts payable and accrued liabilities and the estimated useful lives of long-lived assets. The Company relies on historical experience and on various other assumptions that are believed to be reasonable under the circumstances in making judgments about the carrying value of assets or liabilities that are not readily apparent from other sources. Actual results could differ from those estimates under different assumptions or conditions.

Revenue recognition

The Company derives revenue primarily from subscriber service, activation fees [net of customer rebates earned] and sale of equipment. Revenue from subscribers consists of subscription fees, non-refundable activation fees, and the effects of rebates. Revenue is recognized as it is realized or realizable and earned.

The Company recognizes subscription fees as service is provided to the subscriber. Prepaid subscription fees are recorded as deferred revenue and amortized to revenue ratably over the term of the applicable subscription plan.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

At the time of sale, vehicle owners purchasing or leasing a vehicle with a subscription to Sirius Canada's service typically receive between a three-month and one-year prepaid subscription. Prepaid subscription fees received from automakers are recorded as deferred revenue and amortized to revenue ratably over the service period, upon activation. The Company reimburses automakers for certain costs associated with the satellite radio installed in the applicable vehicle at the time the vehicle is manufactured. The associated payments to the automakers are included in subscriber acquisition costs, which are part of sales and marketing. Although the Company receives payments from the automakers, they do not resell the service; the automakers facilitate the sale of the service to their customers, acting similarly to an agent. In the opinion of management, this is the appropriate characterization of the Company's relationship with automakers since the Company is responsible for providing the service to the customers, including being obligated to the customers in the case of an interruption of service.

Activation fees are recognized evenly over the estimated term of a subscriber relationship which is based upon historical customer subscription terms of similar businesses. The Company currently estimates this period to be 3.5 years.

Equipment revenue from the direct sale of satellite radios and accessories is recognized upon shipment. Shipping and handling costs billed to customers are recorded as revenue. Shipping and handling costs associated with shipping goods to customers are recorded within cost of service expense.

Interest income is accrued as earned.

Foreign currency translation

Monetary assets and liabilities denominated in foreign currencies are translated into Canadian dollars at the exchange rates in effect at the balance sheet date and non-monetary assets and liabilities are translated at rates in effect when the assets were acquired or obligations incurred. Revenue and expenses are translated at average exchange rates prevailing during the year. All exchange gains or losses are included in the determination of net income for the year.

Inventory

Inventory is valued at the lower of invoiced cost and net realizable value using a standard costing system. The balance consists of finished goods.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

Property and equipment

Property and equipment are reported at cost less accumulated amortization. Amortization is calculated using the straight-line method over the estimated useful lives of the Company's property and equipment as follows:

Terrestrial repeaters	7 years
Computer hardware	3 years
Office equipment	3 - 5 years
Furniture and fixtures	7 years
Leasehold improvements	Term of lease

Intangible assets

Intangible assets with definite useful lives are amortized over their useful lives using the straight-line method as follows:

Computer software	3 - 5 years
Computer software licenses	Term of license

The Company evaluates the recoverability of intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the intangible assets may not be recoverable.

Impairment of long-lived assets

The Company evaluates the recoverability of long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, a significant change in the extent or manner in which an asset is used, or a significant adverse change that would indicate that the carrying amount of an asset or group of assets is not recoverable. This valuation is performed by comparing the carrying amounts of these assets to the related estimated undiscounted future cash flows expected to be derived from these assets. If these future cash flows are less than the carrying amount of the asset, then the carrying amount of the asset is written down to its fair value, based on the related estimated discounted future cash flows. While the Company believes that its estimates of future cash flows are reasonable, different assumptions regarding such cash flows could materially affect its evaluations of asset recoverability.

Employee savings plan

The Company sponsors the Sirius Canada Inc. Group Registered Retirement Savings Plan ["RRSP"]/Deferred Profit Sharing Plan ["DPSP"] [the "Plan"] for eligible employees. The Plan allows eligible employees to voluntarily contribute to a Group RRSP subject to certain defined limitations. Currently, the Company matches 100% of an employee's voluntary contributions via a DPSP, up to 4% of an employee's pre-tax base salary, in the form of cash contributions. The total expense resulting from the Company's matching contribution to the Plan was $238,664 for the period ended January 1, 2010 to November 30, 2010 [year ended December 31, 2009 - $241,036].

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

Income taxes

Income taxes are accounted for under the liability method of accounting for income taxes. Under this method, future tax assets and liabilities are recognized for the differences between the financial statement and income tax bases of assets and liabilities, and for operating losses. A valuation allowance is provided for the portion of future tax assets that is more likely than not to remain unrealized. Future tax assets and liabilities are measured using the substantively enacted tax rates and laws expected to apply when these assets or liabilities are expected to be realized or settled.

Advertising costs

Advertising costs are expensed as the services are received.

Subscriber acquisition costs

Subscriber acquisition costs consist of costs incurred to acquire new subscribers and include hardware subsidies paid to radio manufacturers, distributors and automakers, including subsidies paid to automakers who include a satellite radio and a prepaid subscription to the Company's service in the sale or lease price of a new vehicle; subsidies paid for chip sets and certain other components used in manufacturing radios; device royalties for certain radios; commissions paid to retailers and automakers as incentives to purchase, install and activate radios; and provisions for inventory allowance. Subscriber acquisition costs do not include advertising, loyalty payments to distributors and dealers of radios and revenue share payments to automakers and retailers of radios.

Subsidies paid to radio manufacturers and automakers are expensed upon shipment of the product. Commissions paid to retailers and automakers are expensed upon either the purchase or activation of radios.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

Financial instruments

All financial instruments are classified into the following categories: held-for-trading, held-to-maturity investments, loans and receivables, available-for-sale financial assets or other financial liabilities. All financial instruments are included in the financial statements and are initially measured at fair values. Subsequently, all financial instruments are re-measured to fair value at each reporting period except for loans and receivables, held-to-maturity investments and other financial liabilities which are measured at amortized cost using the effective interest method. Held-for-trading financial instruments are subsequently measured at fair value and all gains and losses as a result of measurement are included in the statement of operations and comprehensive income in the year in which they arise. Available-for-sale financial instruments are subsequently measured at fair value with revaluation gains and losses included in other comprehensive income until the instrument is derecognized or an impairment loss is recognized.

3. ADOPTION OF NEW ACCOUNTING POLICIES

In February 2008, Canada's Accounting Standards Board confirmed that Canadian GAAP, as used by publicly accountable enterprises, will be fully converged to International Financial Reporting Standards ["IFRS"], as issued by the International Accounting Standards Board ["IASB"].

In December 2009, the Accounting Standards Board approved the final accounting standards for private enterprises in Canada. These standards provide Canadian private enterprises the ability to choose to adopt new Canadian accounting standards for private enterprises or IFRS. Private enterprises must decide which of the sets of standards to adopt for years beginning on or after January 1, 2011. The new standards include simplification of recognition, measurement and presentation. The Company is currently assessing the impact of the adoption of IFRS on its financial statements.

Section 1582 of the Canadian Institute of Chartered Accountants' ["CICA"] Handbook, "Business Combinations", replaces the existing Section 1581, "Business Combinations". The CICA also issued Section 1601, "Consolidated Financial Statements" and Section 1602, "Non-controlling Interests", which replaces Section 1600, "Consolidated Financial Statements". These new sections are based on the IASB's IFRS 3, "Business Combinations", and will replace the existing guidance on business combinations and consolidated financial statements. The objective of the new standards is to harmonize Canadian accounting for business combinations with the international and U.S. accounting standards. The three new standards have to be adopted concurrently and will apply to the Company's financial statements for the year ended November 30, 2011.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

4. RELATED PARTY TRANSACTIONS

Amounts due to related parties consist of the following:

	November 30, 2010		December 31, 2009
		$		$

CBC [i]		5,109,915		4,500,280
Slaight [i]		4,557,984		3,672,723
Sirius XM [ii]		10,168,782		7,633,768
		19,836,681		15,806,771

Related party transactions with the parties listed above included within the statement of operations and comprehensive income are as follows:

	Period from January 1 to November 30, 2010		Year ended December 31, 2009
		$		$

Cost of service		13,366,130		10,918,722
Sales and marketing		8,369,977		7,893,902
Information and technology		2,631,091		3,119,136
General and administrative		10,853		-
		24,378,051		21,931,760

These transactions have been measured at their respective exchange amounts, being the consideration established and agreed to by the related parties.

For the period from January 1, 2010 to November 30, 2010, property and equipment totalling $108,918 [year ended December 31, 2009 - $157,760] and intangible assets totalling $383,496 [year ended December 31, 2009 - $239,312] relating to purchases made for computer hardware and computer software from Sirius XM are presented within the balance sheet.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

[i]

The Company entered into two 12-year non-exclusive, non-transferable license agreements with CBC and Slaight whereby the Company has obtained distribution rights to transmit channels currently owned by the parties within Canada. The amounts owing to CBC for the distribution rights, as at November 30, 2010 and for the period from January 1, 2010 to November 30, 2010, have been accrued and expensed subject to the terms below. Effective September 1, 2008, the obligation for Slaight to provide these production channels was terminated.

[ii]	In 2005, the Company entered into a license and service agreement with Sirius XM whereby the Company acquired the right to distribute channels owned or licensed by Sirius XM within Canada. In return, the Company is obligated to pay Sirius XM a percentage of its gross revenue, to a maximum of 15%.

Future minimum annual commitments to related parties under the license agreements and the license and service agreement noted above are included in note 11. In addition to the license agreements and the license and service agreement listed above, the Company has accumulated dividends owing to shareholders as described in note 8.

5. INVENTORY

Inventory consists of the following:

	November 30, 2010		December 31, 2009
		$		$

Finished goods		1,409,832		598,488

The amount of inventory recognized as an expense in cost of service for the period from January 1, 2010 to November 30, 2010 was $1,194,156 [year ended December 31, 2009 - $1,076,529].

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

6. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

	November 30, 2010
			Accumulated		Net book
	Cost		amortization		value
		$		$		$

Terrestrial repeaters		4,550,835		2,936,092		1,614,743
Computer hardware		1,368,523		1,015,345		353,178
Office equipment		116,447		94,086		22,361
Furniture and fixtures		436,626		235,423		201,203
Leasehold improvements		991,650		546,783		444,867
		7,464,081		4,827,729		2,636,352

	December 31, 2009
			Accumulated		Net book
	Cost		amortization		value
		$		$		$

Terrestrial repeaters		4,785,439		2,466,357		2,319,082
Computer hardware		1,168,763		857,219		311,544
Office equipment		116,447		72,774		43,673
Furniture and fixtures		433,032		178,568		254,464
Leasehold improvements		991,650		367,649		624,001
		7,495,331		3,942,567		3,552,764

Total amortization expense presented within the statement of operations and comprehensive income for the period from January 1, 2010 to November 30, 2010 which relates to property and equipment is $885,162 [year ended December 31, 2009 - $1,138,146].

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

7. INTANGIBLE ASSETS

Intangible assets consist of the following:

	November 30, 2010
			Accumulated		Net book
	Cost		amortization		value
		$		$		$

Computer software		6,976,601		3,469,511		3,507,090
Computer software licenses		2,687,131		1,778,355		908,776
		9,663,732		5,247,866		4,415,866

	December 31, 2009
			Accumulated		Net book
	Cost		amortization		value
		$		$		$

Computer software		4,400,321		2,655,077		1,745,244
Computer software licenses		2,363,311		1,070,927		1,292,384
		6,763,632		3,726,004		3,037,628

Total amortization expense presented within the statement of operations and comprehensive income for the period from January 1, 2010 to November 30, 2010 which relates to intangible assets is $1,521,862 [year ended December 31, 2009 - $1,215,076].

As at November 30, 2010, computer software totaling $383,496 [December 31, 2009 - nil] represents internally-developed intangible assets. The amount of computer software not yet subject to amortization at November 30, 2010 is $2,344,246 [December 31, 2009 - nil]. During the period from January 1, 2010 to November 30, 2010, accelerated amortization was recognized as a result of the expected termination of use of certain computer software in July 2011.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

8. SHARE CAPITAL

The Company's authorized share capital consists of the following:

•	Unlimited number of voting Class A shares with no par value and no fixed dividends;

•	Unlimited number of non-voting Class B shares with no par value and no fixed dividends; and

•	Unlimited number of non-voting Class C shares with no par value and 8% cumulative dividends.

The Class A shares and Class B shares participate in the equity of the Company on an equal per share basis. Class C shares are redeemable by the Company at any time at the redemption price. Class C shareholders are entitled to cumulative dividends, payable when declared by the Board of Directors. As at November 30, 2010, the Company had accrued $13,653,567 [December 31, 2009 - $11,018,170] of cumulative dividends in accordance with its license agreements and the license and service agreement. As at November 30, 2010, no payments have been made in regard to these dividends. The above amount has been included in the due to related parties balance as detailed within note 4.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

9. SUPPLEMENTAL CASH FLOW DISCLOSURE

The net change in non-cash working capital balances related to operations consists of the following:

	Period from January 1 to November 30, 2010			Year ended December 31, 2009
		$			$

Decrease (increase) in assets
Accounts receivable		4,177,172			(2,644,207	)
Other prepaid expenses		(397,720	)		(747,562	)
Inventory		(811,344	)		54,934

Increase (decrease) in liabilities
Accounts payable		(2,749,729	)		1,848,829
Accrued liabilities		5,213,182			(12,783,464	)
Due to related parties		1,136,703			(15,048,480	)
Deferred revenue		446,251			3,575,143
Deferred leasehold inducement		(39,316	)		(42,890	)
Net change in non-cash working capital balances related to operations		6,975,199			(25,787,697	)

Interest income received included in operating activities is as follows:

	Period from January 1 to November 30, 2010		Year ended December 31, 2009
		$		$

Interest income received		186,592		177,498

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

10. FINANCIAL INSTRUMENTS

The Company has designated the following classifications for its financial assets and financial liabilities:

Cash is classified as held-for-trading with a total carrying value of $47,610,454 at November 30, 2010 [December 31, 2009 - $24,677,367]. Interest income is earned on cash balances.

Accounts receivable are classified as loans and receivable, which are measured at amortized cost, using the effective interest rate method. No interest in relation to these instruments was recognized in the financial statements as at November 30, 2010 or December 31, 2009.

Accounts payable, accrued liabilities and due to related parties are classified as other financial liabilities, which are measured at amortized cost using the effective interest rate method. No interest in relation to these instruments was recognized in the financial statements as at November 30, 2010 or December 31, 2009.

Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates, will affect the Company's income or the value of its holdings of financial instruments.

To perform sensitivity analysis, the Company assesses the impact of hypothetical changes in interest rates and foreign currency exchange rates on foreign currency denominated and interest-bearing financial instruments. Information provided by the analysis does not represent the Company's view of future market changes, nor does it necessarily represent the actual changes in fair value that would occur under normal market conditions because, of necessity, all variables other than the specific market risk factor are held constant. In reality, changes in one factor may result in a change to another, which may magnify or counteract the sensitivities.

Foreign currency risk

The Company is exposed to fluctuations of the Canadian dollar in relation to the US dollar, resulting from US dollar-denominated cash, accounts receivable, and liabilities. The Company does not currently use foreign currency derivatives.

Most of the Company's revenue and expenses are received or paid in Canadian dollars. The Company's only exposure to material foreign currency risk is with respect to payments under OEM agreements and due to Sirius XM under a license and service agreement.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

Given that the Company's exposure is limited to payments to Sirius XM, management does not actively manage this risk.

As at November 30, 2010, the Canadian/U.S. foreign exchange rate was 1.0266. Assuming that all other variables remain constant, a decrease of 10% [with opposite impacts on an increase of similar proportion] in the Canadian dollar would have the following impact on the ending balances of certain balance sheet items:

	$

Financial assets
Cash	519,716
Accounts receivable	98,914

Financial liabilities
Accounts payable	(5,170	)
Accrued liabilities	(9,290	)
Due to related parties	(382,403	)
Net foreign exchange gain	221,767

The impact on the net income is equivalent to the net foreign exchange gain presented in the table above. There is no impact on other comprehensive income.

Interest rate risk

The Company is subject to interest rate risk from changes in interest rates on the Company's cash balances.

Credit risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. The Company is exposed to credit risk, primarily in relation to its cash and accounts receivable, both of which are uncollateralized.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

The carrying amount of these financial assets represent the maximum credit exposure which as at the following dates was as follows:

	November 30, 2010		December 31, 2009
		$		$

Cash		47,610,454		24,677,367
Accounts receivable		8,652,620		12,829,792

The Company's objective is to minimize its exposure to credit risk in order to prevent losses on financial assets by placing its cash with major chartered Canadian banks. Due to their short-term nature and placement with major chartered Canadian banks, cash is not exposed to material credit risk.

With respect to accounts receivable, exposure to credit risk varies due to the composition of individual customer balances. Subscription fees are received through either credit card payments or cheque remittances. The majority of subscriber billings are credit card transactions.

For cheque remittances, the Company regularly monitors customer balances to assess credit risk.

The Company assesses the credit risk of accounts receivable by evaluating the age of accounts receivable based on the invoice date. Accounts receivable are considered past due 31 days after the invoice date. The following table sets out details of the aging of accounts receivable that are outstanding and the related allowance for doubtful accounts:

	November 30, 2010			December 31, 2009
		$			$

Current		6,617,929			11,127,691
31-60 days		2,073,544			1,908,861
61-90 days		91,491			80,250
Over 90 days		206,484			294
Less allowance for doubtful accounts		(336,828	)		(287,304	)
		8,652,620			12,829,792

No past due accounts have been renegotiated with different terms.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

The Company believes that the concentration of credit risk of accounts receivable is limited as accounts receivable are widely distributed among many subscribers across Canada and there are no specific types of customers that have unique characteristics.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due or the risk that those financial obligations have to be met at excessive cost. The Company's management believes that cash flows from operations should be sufficient to cover committed cash requirements for capital investments, working capital and dividends in the future.

As at November 30, 2010, these obligations and their maturities are as follows:

	Total		Less than 1 year		1-3 years		3-5 years		5 years or more
		$		$		$		$		$

Accounts payable		4,240,897		4,240,897		-		-		-
Accrued liabilities		28,082,303		28,082,303		-		-		-
Due to related parties		19,836,681		19,836,681		-		-		-
Future tax liability		1,133,756		1,133,756		-		-		-
Operating leases and other commitments		32,226,374		13,831,314		8,432,004		6,357,281		3,605,775
Other liabilities		85,520,011		67,124,951		8,432,004		6,357,281		3,605,775

Fair value

The carrying values of cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities and amounts due to related parties approximate their fair values due to the short-term nature of these financial instruments.

Capital disclosures

The Company's objectives when managing capital are to:

[a]	maintain financial flexibility to meet financial obligations and growth objectives; and

[b]	maintain a capital structure that allows multiple financing options to the Company should a financing need arise.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

The Company defines the capital that it manages as its shareholders' deficiency. In managing capital, the Company focuses on liquid resources available for operations. The need for sufficient liquid resources is considered in the preparation of an annual budget and in the monitoring of cash flows and actual operating results compared to the budget.

The basis for the Company's capital structure is dependent on the Company's expected growth, financial obligations and changes in the business. To maintain or adjust its capital structure, the Company may issue additional shares or raise debt.

The Company's objectives and strategies are reviewed periodically.

11. COMMITMENTS

Future minimum annual lease payments under operating leases for premises and equipment, license and service agreements and contractual obligations are approximately as follows:

			$

2011			13,831,314
2012			4,962,142
2013			3,469,862
2014			3,212,066
2015			3,145,215
Thereafter			3,605,775
			32,226,374

In addition to the above operating commitments, the Company has related party commitments which are detailed within note 4.

In previous years, the Company had accrued its best estimates of amounts due related to regulatory tariffs. On April 8, 2009, the Copyright Board of Canada issued a decision dealing with royalties to be paid by satellite radio services for their use of music for the years 2005 to 2010. As at November 30, 2010, all amounts due and payable to the three copyright collectives have been paid. The amount paid relating to periods up to December 31, 2008 was $4,962,511 less than had previously been provided and this adjustment has been recorded as a reduction to cost of service for the year ended December 31, 2009.

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

On October 7, 2009, the Canadian Association of Broadcasters announced that its Board of Directors, along with other fee-paying stakeholders, approved the terms of a settlement agreement with the Government of Canada pertaining to the Part II license fee issue. The agreement provides that fees due to the Government of Canada, but not collected by the CRTC for fiscal 2007, 2008 and 2009, will be waived. A fee will be payable in the future as a new Part II fee regime will be implemented. At the time of the agreement, an amount of $3,632,360 had been accrued for Part II fees and this amount has been recorded as a reduction to general and administrative expenses for the year ended December 31, 2009.

12. INCOME TAXES

Future income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

The reconciliation of the provision for income taxes computed at the statutory tax rates is as follows:

	Period from January 1 to November 30, 2010			Year ended December 31, 2009
		$			$

Net income before taxes		15,273,325			12,973,068
Statutory tax rate		31.0	%		33.0	%

Income tax expense at statutory tax rate		4,734,731			4,281,112
Change in valuation allowance and rate changes		(4,734,731	)		(4,281,112	)
Net income tax expense		-			-

Sirius Canada Inc.

NOTES TO FINANCIAL STATEMENTS

[Expressed in Canadian dollars]

November 30, 2010

Significant components of the Company's estimated future tax assets and liabilities are as follows:

	November 30, 2010			December 31, 2009
		$			$

Tax basis in excess of book value		2,393,000			1,789,000
Future tax asset - reserve		665,000			609,000
Non-capital loss carryforward		22,032,000			26,339,000
Total future tax assets		25,090,000			28,737,000
Valuation allowance for future tax assets		(25,090,000	)		(28,737,000	)
Net future tax assets		-			-

A valuation allowance has been provided to fully offset the future tax assets as the Company is not certain that such benefits can be utilized in the near future.

The Company has included a Part VI.1 future tax liability of $1,133,756 as at November 30, 2010 [December 31, 2009 - $914,140] for accumulated dividends to shareholders on their taxable preferred shares.

As at November 30, 2010, the Company has approximately $88,128,000 in Canadian non-capital tax losses available to be applied against future years' taxable income, which expire as follows:

			$

2026			46,245,000
2027			37,787,000
2028			4,096,000
			88,128,000

Canadian Satellite Radio Holdings Inc. 6-K