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(e) estimated value of asset retirement obligations that are dependent upon estimates of future costs and timing of expenditures; and estimated future recoverable value of property, plant and equipment and goodwill.

MD&A

(f)

The Trust has hired individuals and consultants who have the skills required to make such estimates and ensures individuals or departments with the most knowledge of the activity are responsible for the estimates. Further, past estimates are reviewed and compared to actual results, and actual results are compared to budgets in order to make more informed decisions on future estimates.

AR 2005

The ARC leadership team’s mandate includes ongoing development of procedures, standards and systems to allow ARC staff to make the best decisions possible and ensuring those decisions are in compliance with the Trust’s environmental, health and safety policies.

Financial Reporting and Internal Controls Update On July 31, 2002, the United States Congress enacted the Sarbanes Oxley Act (“SOX”). SOX applies to all companies registered with the Securities and Exchange Commission (“SEC”). Although ARC is not listed on a US stock exchange, the Trust is registered with the SEC as a result of having acquired Startech Energy Inc. in 2001 and therefore is required to comply with certain portions of the SOX legislation. There are various components to the SOX legislation, however the most comprehensive is Section 404 “Internal Controls Over Financial Reporting”. Section 404 requires that management undertake the following: • identify and document internal controls that impact financial reporting; • assess the effectiveness of those internal controls; • remediate any deficiencies in internal controls and/or implement any required controls that are not already in place; • test the internal controls to ensure that they are operating effectively; and • issue a report, to be signed by the CEO and CFO, on management’s assessment of the effectiveness of internal controls and communicate any material weaknesses. ARC is currently required to comply with section 404 of the SOX legislation on December 31, 2006. In conjunction with the 2006 year end audit, ARC’s external auditors will audit the Trust’s internal controls and will issue two opinions, one on the auditor’s assessment of the effectiveness of internal controls over financial reporting and one on the auditor’s opinion on management’s assessment of the internal controls over financial reporting. The Trust currently has a comprehensive plan and a dedicated team of individuals in place to execute the plan of meeting the SOX Section 404 compliance date. As of December 31, 2005, an internal evaluation was carried out of the effectiveness of the Trust’s disclosure controls and procedures as defined in Rule 13a-15 under the US Securities Exchange Act of 1934. Based on that evaluation, the President and Chief Executive Officer and Chief Financial Officer concluded that the design and operation of these disclosure controls and procedures were effective to ensure that material information relating to the Trust is made known to management on a timely basis and is included in this report. No changes were made to our internal control over financial reporting during the year ended December 31, 2005, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. In addition to SOX, ARC is required to comply with Multilateral Instrument 52-109 “Certification of Disclosure in Issuers’ Annual and Interim Filings”, otherwise referred to as Canadian SOX (“C-Sox”). ARC is currently complying with this legislation by filing bare interim and annual certificates. It is expected that ARC will be required to file a full annual certificate in conjunction with the December 31, 2006 year end. The Canadian requirements closely parallel the SEC’s certification rules, however, currently there is no requirement to have external auditor’s opinion on the Trust’s internal controls or management’s assessment thereof.

Objectives and 2006 Outlook It is the Trust’s objective to provide superior long-term returns to unitholders by focusing on the key strategic objectives of the business plan. The Trust has provided unitholders with the following one, three and five year returns (assuming the reinvestment of distributions): Total Returns One year

($ per unit except for per cent)

Three year

Five year

Distributions per unit Capital appreciation per unit

$

1.99 8.59

$

5.59 14.59

$

9.46 15.19

Total return per unit Annualized total return per unit

$

10.58 62.4%

$

20.18 46.5%

$

24.65 38.8%

43

2005  

Annual Report

2005  

Annual Report

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