EX-99.2

CGI GROUP INC.

Consolidated Statements of Earnings

For the three months ended December 31

(in thousands of Canadian dollars, except share data) (unaudited)


	2010			2009

		$			$

Revenue		1,120,688			913,006


Operating expenses
Costs of services, selling and administrative		911,610			750,385
Amortization (Note 7)		50,220			44,306
Acquisition-related and integration costs (Note 6b)		2,185			—
Interest on long-term debt		5,824			3,729
Interest income		(595	)		(371	)
Other income		(1,230	)		(528	)
Foreign exchange loss (gain)		309			(1,121	)

		968,323			796,400

Earnings before income taxes		152,365			116,606
Income tax expense		25,791			5,387

Net earnings		126,574			111,219

Attributable to:
Shareholders of CGI Group Inc.		126,406			110,852
Non-controlling interest		168			367


Basic earnings per share attributable to shareholders of CGI Group Inc. (Note 5e)		0.47			0.38

Diluted earnings per share attributable to shareholders of CGI Group Inc. (Note 5e)		0.45			0.37

Page 2 of 21

CGI GROUP INC.

Consolidated Statements of Comprehensive Income

For the three months ended December 31

(in thousands of Canadian dollars) (unaudited)


	2010			2009

		$			$
Net earnings		126,574			111,219

Net unrealized losses on translating financial statements of self-sustaining foreign operations (net of income taxes)		(61,338	)		(25,650	)
Net unrealized gains on translating long-term debt designated as hedges of net investments in self-sustaining foreign operations (net of income taxes)		28,271			2,944
Net unrealized (losses) gains on cash flow hedges (net of income taxes)		(225	)		5,171
Net unrealized gains on available for sale investments (net of income taxes)		337			—

Other comprehensive loss (Note 8)		(32,955	)		(17,535	)

Comprehensive income		93,619			93,684

Attributable to:
Shareholders of CGI Group Inc.		93,451			93,317
Non-controlling interest		168			367

Consolidated Statements of Retained Earnings
For the three months ended December 31
(in thousands of Canadian dollars) (unaudited)


	2010			2009

		$			$
Retained earnings, beginning of period		1,196,386			1,182,237
Net earnings attributable to shareholders of CGI Group Inc.		126,406			110,852
Excess of purchase price over carrying value of Class A subordinate shares repurchased (Note 5a)		(56,974	)		(97,008	)
Change in subsidiary investment		—			(285	)

Retained earnings, end of period		1,265,818			1,195,796

Page 3 of 21

CGI GROUP INC.

Consolidated Balance Sheets

(in thousands of Canadian dollars)(unaudited)


	As at December 31, 2010			As at September 30, 2010

		$			$
Assets
Current assets
Cash and cash equivalents (Note 2)		79,997			127,824
Short-term investments		11,965			13,196
Accounts receivable		466,550			423,926
Work in progress		359,165			358,984
Prepaid expenses and other current assets		78,354			76,844
Income taxes		8,401			7,169
Future income taxes		7,314			16,509

Total current assets before funds held for clients		1,011,746			1,024,452
Funds held for clients (Note 3)		257,982			248,695

Total current assets		1,269,728			1,273,147
Capital assets		245,352			238,024
Intangible assets (Note 4)		489,923			516,754
Other long-term assets		43,025			42,261
Future income taxes		10,995			11,592
Goodwill		2,477,469			2,525,413

		4,536,492			4,607,191


Liabilities
Current liabilities
Accounts payable and accrued liabilities		327,953			304,376
Accrued compensation		161,254			191,486
Deferred revenue		177,493			145,793
Income taxes		24,587			86,877
Future income taxes		31,761			26,423
Current portion of long-term debt		114,831			114,577

Total current liabilities before clients’ funds obligations		837,879			869,532
Clients’ funds obligations (Note 3)		257,508			248,695

Total current liabilities		1,095,387			1,118,227
Future income taxes		161,679			170,683
Long-term debt		976,150			1,039,299
Other long-term liabilities		114,335			119,899

		2,347,551			2,448,108


Shareholders’ equity
Retained earnings		1,265,818			1,196,386
Accumulated other comprehensive loss (Note 8)		(354,701	)		(321,746	)

		911,117			874,640
Capital stock (Note 5a)		1,187,463			1,195,069
Contributed surplus (Note 5d)		83,741			82,922

Equity attributable to shareholders of CGI Group Inc.		2,182,321			2,152,631
Equity attributable to non-controlling interest		6,620			6,452

		2,188,941			2,159,083

		4,536,492			4,607,191

Page 4 of 21

CGI GROUP INC.

Consolidated Statements of Cash Flows

For the three months ended December 31

(tabular amounts only are in thousands of Canadian dollars) (unaudited)


	2010			2009

		$			$
Operating activities
Net earnings		126,574			111,219
Adjustments for:
Amortization (Note 7)		55,635			49,881
Future income taxes		9,740			(22,879	)
Foreign exchange loss (gain)		227			(490	)
Stock-based compensation costs (Note 5d)		4,405			3,241
Net change in non-cash working capital items		(101,371	)		25,156

Cash provided by operating activities		95,210			166,128


Investing activities
Net change in short-term investments		714			(9,020	)
Purchase of capital assets		(16,821	)		(8,215	)
Additions to intangible assets		(17,642	)		(18,150	)

Cash used in investing activities		(33,749	)		(35,385	)


Financing activities
Use of credit facilities		5,968			—
Repayment of credit facilities		(40,268	)		—
Repayment of long-term debt		(7,441	)		(4,250	)
Purchase of Class A subordinate shares held in trust (Note 5a)		(2,566	)		—
Repurchase of Class A subordinate shares (including share repurchase costs) (Note 5a)		(81,006	)		(150,368	)
Issuance of shares		15,793			24,365
Change in subsidiary investment		—			(727	)

Cash used in financing activities		(109,520	)		(130,980	)

Effect of foreign exchange rate changes on cash and cash equivalents		232			(5,765	)

Net decrease in cash and cash equivalents		(47,827	)		(6,002	)
Cash and cash equivalents, beginning of period		127,824			343,427

Cash and cash equivalents, end of period (Note 2)		79,997			337,425

Interest paid		3,514			1,306
Income taxes paid		72,721			23,560

Non-cash transactions

Significant non-cash transactions consisted of capital assets and intangible assets acquired for a total amount of $15,775,000 for the three months ended December 31, 2010 ($10,267,000, for the three months ended December 31, 2009).

Page 5 of 21

CGI GROUP INC.

Notes to the Consolidated Financial Statements

For the three months ended December 31, 2010 and 2009

(tabular amounts only are in thousands of Canadian dollars, except share data) (unaudited)

Summary of significant accounting policies

		a) Basis of presentation

		The interim consolidated financial statements for the three months ended December 31, 2010 and 2009 are unaudited and include all adjustments that management of CGI Group Inc. (the “Company”) considers necessary for a fair presentation of the financial position, results of operations and cash flows.

		The disclosures provided in these interim consolidated financial statements do not conform in all respects with the requirements of Canadian generally accepted accounting principles (“GAAP”) for annual consolidated financial statements; therefore, the interim consolidated financial statements should be read in conjunction with the annual consolidated financial statements of the Company for the year ended September 30, 2010. These interim consolidated financial statements have been prepared using the same accounting policies and methods of their application as the annual consolidated financial statements for the year ended September 30, 2010, except for new accounting policies adopted effective October 1, 2010.

		Certain comparative figures have been reclassified to conform to the current period’s presentation.

Page 6 of 21

CGI GROUP INC.
Notes to the Consolidated Financial Statements
For the three months ended December 31, 2010 and 2009
(tabular amounts only are in thousands of Canadian dollars, except share data) (unaudited)

1.		Summary of significant accounting policies (continued)

		b) Change in accounting policies

		On October 1, 2010, the Company early adopted the following accounting guidance:

	i)		Emerging Issue Committee (“EIC”) Abstract No. 175 (“EIC-175”), “Revenue Arrangements with Multiple Deliverables” issued by the Canadian Institute of Chartered Accountants (“CICA”) in December 2009 which amends the EIC Abstract No. 142, “Revenue Arrangements with Multiple Deliverables”. The EIC-175 is equivalent to U.S. GAAP standard, Accounting Standards Update (“ASU”) No. 2009-13 (“ASU 2009-13”), “Multiple-Deliverable Revenue Arrangements” and applies to arrangements that include multiple-deliverables that are not accounted for pursuant to other specific guidance such as U.S. software revenue recognition guidance. The new guidance changes the requirements for establishing separate deliverables in a multiple-deliverable arrangement and requires the allocation of arrangement consideration to each separately identified deliverable based on the relative selling price. Based on this method, the selling price of each separately identified deliverable is determined using vendor-specific objective evidence (“VSOE”) of selling price if available, otherwise third-party evidence (“TPE”) of selling price, or estimated selling price (“ESP”) if neither VSOE nor TPE of selling price is available. The residual method of allocating arrangement consideration is no longer permitted. EIC-175 also expands the disclosures required for multiple-deliverable arrangements which are reflected below.

	ii)		ASU No. 2009-14 (“ASU 2009-14”), “Certain Revenue Arrangements that Include Software Elements” issued by the Financial Accounting Standards Board (“FASB”) under U.S. GAAP which amends Accounting Standards Codification Topic 985-605, “Software — Revenue Recognition”. ASU 2009-14 modifies the scope of the software recognition guidance to exclude the tangible products that contain both software and non-software components that function together to deliver a product’s essential functionality. There is no specific software revenue recognition guidance under Canadian GAAP, therefore the Company follows the U.S. guidance.

The adoption of the above accounting guidance, which was made prospectively to new revenue arrangements with multiple-deliverables entered into or materially modified on or after October 1, 2010, did not have any material impact on the Company’s consolidated financial statements. There were no significant changes to the Company’s units of accounting within its multiple-deliverable arrangements, how the Company allocates arrangement consideration and the pattern or timing of revenue recognition as a result of the adoption of this accounting guidance. However, the residual method is no longer used by the Company when allocating arrangement consideration. The effects on future periods will depend on the nature and significance of the new or materially modified arrangements in any given period.

Page 7 of 21

1.		Summary of significant accounting policies (continued)

		b) Change in accounting policies (continued)

		The Company revised its previously disclosed revenue recognition policy to reflect major changes resulting from the adoption of EIC-175 which applies to multiple-deliverable arrangements entered into or materially modified on or after October 1, 2010. The major changes to the revenue recognition policy are disclosed below. The previously disclosed revenue recognition policy remains effective for multiple-deliverable arrangements that were in place as of, and were not materially modified after, September 30, 2010.

		Multiple-deliverable arrangements — Non-software

		The Company enters into arrangements with multiple non-software deliverables that generally include systems integration and consulting services, outsourcing services and business process services (“BPS”). Under the new guidance, the total arrangement value is allocated to each element as a separate unit of accounting if: 1) the delivered item has value to the client on a stand-alone basis; and 2) in an arrangement that includes a general right of return relative to the delivered item, the delivery or performance of the undelivered item is considered probable and substantially in the control of the Company. If these criteria are met, then the total consideration of the arrangement is allocated among the separate units of accounting based on their relative selling price. Based on this method, the selling price of each separately identified deliverable is determined using VSOE of selling price if available, otherwise TPE of selling price, or ESP if neither VSOE nor TPE of selling price is available. VSOE of selling price is established using the price charged for a deliverable when sold separately by the Company. TPE of selling price is established using the vendor’s or competitors’ prices for similar deliverables. ESP is the price at which the Company would offer the service if the deliverable were sold regularly on a stand-alone basis. ESP is established by considering a number of internal and external factors including, but not limited to, geographies, Company’s pricing policies, internal costs, and gross margins.

		Multiple-deliverable arrangements — Software and non-software

		The Company also enters into multiple-deliverable arrangements that may include a combination of various software and software-related deliverables and non-software deliverables including software licenses, systems integration and consulting services, provision of maintenance, outsourcing services and BPS. In such arrangements, the Company first allocates the total arrangement consideration based on the relative selling prices of the software group of deliverables as a whole and to each of the non-software deliverables. The Company then further allocates consideration within the software group to the respective deliverables within that group following the software arrangement policies as described in Note 2 — Summary of Significant Accounting Policies of the Company’s annual consolidated financial statements for the year ended September 30, 2010.

		All deliverables that do not meet the separation criteria are combined into one unit of accounting and the most appropriate revenue recognition method is applied. Most of the deliverables within the Company’s multiple-deliverable arrangements qualify as a separate unit of accounting.

Page 8 of 21

Cash and cash equivalents


	As at December 31, 2010		As at September 30, 2010

		$		$
Cash		43,187		27,162
Cash equivalents		36,810		100,662

		79,997		127,824

Funds held for clients and clients’ funds obligations

		In connection with the Company’s payroll, tax filing and claims services, the Company collects and holds funds collected for payment of payroll, taxes and claims until such time as the funds need to be remitted to the clients’ employees, appropriate tax authorities or claim holders. Funds held for clients represent assets that, based upon the Company’s intent, are used solely for the purposes of satisfying the obligations to remit funds relating to our payroll, tax filing and claims services, which are classified as clients’ funds obligations on the consolidated balance sheets.

		The funds held for clients portfolio includes bonds, which have been classified as available for sale, and cash. The bonds are measured at fair value based on market rates, and therefore have been classified in Level 1 of the fair value hierarchy. Funds held for clients are classified as current assets since these funds are held solely for the purpose of satisfying the clients’ funds obligations, which will be repaid within one year of the balance sheet date.

		Unrealized gains and losses, net of applicable income taxes, are reported on a net basis in comprehensive income in the consolidated statements of comprehensive income. Interest income earned and realized gains and losses on the sale of available for sale investments are recorded in revenue in the period that the income is earned, since the collecting, holding and remitting of these funds are critical components of providing these services.

		The Company is exposed to credit risk in connection with these investments through the possible inability of borrowers to meet the terms of their bonds. In addition, the Company is exposed to interest rate risk, as volatility will cause fluctuations in the fair value of held investments and in the earnings potential of future investments. The Company mitigates these risks by investing primarily in high credit quality provincial and corporate bonds.

		The following table presents the investment portfolio of funds held for clients:


	As at December 31, 2010		As at September 30, 2010

		$		$
Cash		108,200		248,695
Short-term bonds		5,709		—
Long-term bonds		144,073		—

Funds held for clients		257,982		248,695

No funds held for clients were invested in bonds as at September 30, 2010.

Page 9 of 21

Intangible assets


	As at December 31, 2010						As at September 30, 2010
			Accumulated		Net book				Accumulated		Net book
	Cost		amortization		value		Cost		amortization		value

		$		$		$		$		$		$
Intangible assets
Contract costs
Incentives		236,774		194,943		41,831		236,750		190,294		46,456
Transition costs		200,579		99,374		101,205		200,154		102,734		97,420

		437,353		294,317		143,036		436,904		293,028		143,876

Other intangible assets
Internal-use software		91,174		68,861		22,313		90,704		66,841		23,863
Business solutions		279,811		181,389		98,422		283,799		178,491		105,308
Software licenses		177,529		126,297		51,232		174,412		123,977		50,435
Client relationships and other		415,627		240,707		174,920		426,546		233,274		193,272

		964,141		617,254		346,887		975,461		602,583		372,878

		1,401,494		911,571		489,923		1,412,365		895,611		516,754

All intangible assets are subject to amortization. The following table presents the aggregate amount of intangible assets subject to amortization that were acquired or internally developed during the period:


	Three months ended December 31
	2010		2009

		$		$
Acquired		8,236		13,334
Internally developed		13,165		11,273

		21,401		24,607

Page 10 of 21

CGI GROUP INC.
Notes to the Consolidated Financial Statements
For the three months ended December 31, 2010 and 2009
(tabular amounts only are in thousands of Canadian dollars, except share data) (unaudited)

5. Capital stock, stock-based compensation costs, contributed surplus and earnings per share

Capital stock


	Class A subordinate shares						Class B shares				Total

				Carrying					Carrying					Carrying
	Number			value			Number		value		Number			value

				$					$					$
Balance, as at September 30, 2010		237,684,791			1,148,182			33,608,159		46,887		271,292,950			1,195,069
Repurchased and cancelled⁽¹⁾		(4,975,500	)		(24,032	)		—		—		(4,975,500	)		(24,032	)
Issued upon exercise of options⁽²⁾		1,634,072			18,992			—		—		1,634,072			18,992
Purchased and held in trust⁽³⁾		—			(2,566	)		—		—		—			(2,566	)

Balance, as at December 31, 2010		234,343,363			1,140,576			33,608,159		46,887		267,951,522			1,187,463



⁽¹⁾		On January 27, 2010, the Company’s Board of Directors authorized the renewal of a Normal Course Issuer Bid for the purchase of up to 25,151,058 Class A subordinate shares. During the three months ended December 31, 2010, the Company repurchased 4,975,500 Class A subordinate shares for $81,006,000. The excess of the purchase price over the carrying value of Class A subordinate shares repurchased, in the amount of $56,974,000, was charged to retained earnings.

⁽²⁾		The carrying value of Class A subordinate shares includes $3,586,000 ($13,332,000 for the year ended September 30, 2010) which corresponds to a reduction in contributed surplus representing the value of accumulated compensation cost associated with the options exercised during the period.

⁽³⁾		In connection with the performance share unit (“PSU”) plan, the Company provided instructions to a trustee under the terms of a Trust Agreement to purchase 164,012 Class A subordinate shares of the Company in the open market for $2,566,000 during the three months ended December 31, 2010 (refer to Note 5c).

Page 11 of 21

5. Capital stock, stock-based compensation costs, contributed surplus and earnings per share (continued)

Stock option plan

		Under the Company’s stock option plan, the Board of Directors may grant, at its discretion, options to purchase Class A subordinate shares to certain employees, officers, directors and consultants of the Company and its subsidiaries. The exercise price is established by the Board of Directors and is equal to the closing price of the Class A subordinate shares on the Toronto Stock Exchange on the day preceding the date of the grant. Options vest one to four years from the date of grant conditionally upon achievement of objectives and must be exercised within a ten-year period, except in the event of retirement, termination of employment or death.

		The following table presents information concerning all outstanding stock options granted by the Company:



Outstanding, as at September 30, 2010	26,555,483
Granted	6,576,432
Exercised	(1,634,072	)
Forfeited	(2,893,231	)
Expired	(19,994	)

Outstanding, as at December 31, 2010	28,584,618

The following table presents the weighted average assumptions used to determine the stock-based compensation costs related to stock options recorded in cost of services, selling and administrative expenses using the Black-Scholes option pricing model:


	Three months ended December 31

	2010		2009

Stock-based compensation costs ($)		4,246		3,241

Dividend yield (%)		0.00		0.00
Expected volatility (%)		27.11		27.33
Risk-free interest rate (%)		1.99		2.48
Expected life (years)		5.00		5.00
Weighted average grant date fair value ($)		4.29		3.62

Page 12 of 21

5. Capital stock, stock-based compensation costs, contributed surplus and earnings per share (continued)

PSU plan

		On September 28, 2010, the Company adopted a PSU plan for senior executives and other designated employees (“participants”). Under that plan, the Board of Directors may grant PSUs to participants which entitles them to receive one Class A subordinate share for each PSU. The vesting and performance conditions are determined by the Board of Directors at the time of each grant. PSUs expire on December 31, of the third calendar year following the end of the Company’s fiscal year during which the award is made, except in the event of retirement, termination of employment or death.

		On October 1, 2010, the Company granted 164,012 PSUs with a grant date fair value of $15.51 per unit based on the closing price of the Class A subordinate shares on the Toronto Stock Exchange on that date. There was no grant under this plan in fiscal year 2010. Granted PSUs vest annually over a period of four years from the date of grant conditionally upon achievement of objectives.

		Class A subordinate shares purchased in connection with the PSU plan are held in trust for the benefits of the participants. The trust, considered as a variable interest entity, is consolidated in the Company’s financial statements with the cost of the purchased shares recorded as a reduction of capital stock (refer to Note 5a).

		The stock-based compensation costs related to PSUs recorded in cost of services, selling and administrative expenses for the three months ended December 31, 2010 was $159,000 (nil for the three months ended December 31, 2009).

Contributed surplus


	$
Balance, as at September 30, 2010		82,922
Compensation costs associated with exercised options		(3,586	)
Stock-based compensation costs		4,405

Balance, as at December 31, 2010		83,741

Page 13 of 21

5. Capital stock, stock-based compensation costs, contributed surplus and earnings per share (continued)

Earnings per share

The following table sets forth the computation of basic and diluted earnings per share attributable to shareholders of the Company:

Three months ended December 31

2010

2009

Weighted

Weighted

average number

average number

Net

of shares

Earnings

Net

of shares

Earnings

Earnings

outstanding ⁽¹⁾

per share

Earnings

outstanding⁽¹⁾

per share

Basic

126,406

269,903,334

0.47

110,852

295,477,129

0.38

Dilutive options and PSUs⁽²⁾

8,554,265

(0.02

)

6,476,420

(0.01

)

Diluted

126,406

278,457,599

0.45

110,852

301,953,549

0.37



⁽¹⁾		The 4,975,500 Class A subordinate shares repurchased and the 164,012 Class A subordinate shares purchased and held in a trust during the three months ended December 31, 2010 (11,389,780 and nil, respectively, during the three months ended December 31, 2009), were excluded from the calculation of weighted average number of shares outstanding as of the date of transaction.

⁽²⁾		The calculation of diluted earnings per share excluded 6,582,090 options for the three months ended December 31, 2010 (13,079,312 for the three months ended December 31, 2009), as they were anti-dilutive.

6. Investments in subsidiaries

Modifications to purchase price allocation

During the three months ended December 31, 2010, the Company modified the purchase price allocation and made adjustments relating to the acquisition of Stanley Inc. (“Stanley”), resulting in a decrease of intangible assets of $1,743,000, accrued compensation of $765,000 and future income taxes of $383,000, whereas goodwill increased by $595,000. The prior period figures have not been adjusted given that the effect of restatement was not significant.

Acquisition-related and integration costs

In connection with the acquisition of Stanley in fiscal year 2010, the Company expensed $2,185,000 during the three months ended December 31, 2010. The expenses included costs to integrate the operations and to realize synergies.

Page 14 of 21

7. Amortization


	Three months ended December 31

	2010		2009

	$		$
Amortization of capital assets		18,816		17,181
Amortization of intangible assets
Contract costs related to transition costs		5,970		4,903
Other intangible assets		25,434		22,222

		50,220		44,306
Amortization of contract costs related to incentives (presented as a reduction of revenue)		4,999		5,254
Amortization of deferred financing fees (presented in interest on long-term debt)		321		321
Amortization of premiums and discounts on investments related to funds held for clients (presented net as a reduction of revenue)		95		—

		55,635		49,881

8. Accumulated other comprehensive loss

Net changes

Balance, as at

incurred during

Balance, as at

September 30, 2010

the three months

December 31, 2010

Net unrealized losses on translating financial statements of self-sustaining foreign operations (net of accumulated income tax recovery of $15,300 as at December 31, 2010 and $12,686 as at September 30, 2010)

(413,021

)

(61,338

)

(474,359

)

Net unrealized gains on translating long-term debt designated as hedges of net investments in self- sustaining foreign operations (net of accumulated income tax expense of $18,802 as at December 31, 2010 and $14,347 as at September 30, 2010)

76,806

28,271

105,077

Net unrealized gains on cash flow hedges (net of accumulated income tax expense of $5,048 as at December 31, 2010 and $5,336 as at September 30, 2010)

14,469

(225

)

14,244

Net unrealized gains on available for sale investments (net of accumulated income tax expense of $137 as at December 31, 2010)

—

337

(321,746

)

(32,955

)

(354,701

)

For the three months ended December 31, 2010, $2,170,000 of the net unrealized gains previously recognized in other comprehensive income (net of income taxes of $916,000) were reclassified to net earnings for derivatives designated as cash flow hedges.

Page 15 of 21

9. Income tax expense

The Company’s effective income tax rate for the three months ended December 31, 2010 and 2009 were 16.9% and 4.6%, respectively. For the three months ended December 31, 2010, the expense contained a favorable tax adjustment of $18,727,000 mainly as a result of expiration of limitation periods. For the three months ended December 31, 2009, the expense contained a favorable tax adjustment in the amount of $30,532,000 mainly as a result of the final determinations and expiration of limitation periods. Without these favorable tax adjustments, the Company’s income tax rate for the three months ended December 31, 2010 and 2009 would have been 29.2% and 30.8%, respectively.

10. Segmented information

In prior years, management regularly reviewed the Company’s operating results based on a geographic delivery view, in addition to Corporate services. As a result of changes to the management reporting structure, the Company is now managed through four operating segments based on its delivery model incorporating domestic activities as well as impacts from utilizing its centres of excellence.

	-		The Global Infrastructure Services (“GIS”) segment incorporates all services provided to clients for their technology infrastructure management. This segment incorporates results from these services world-wide.

	-		The other segments incorporate all other services provided to clients based on a geographical delivery model: Canada, U.S. & India and Europe & Asia Pacific. In addition to system integration and consulting, services may include the outsourcing of projects and applications, application maintenance and support as well as BPS.

Due to the change in operating segments, the Company conducted a goodwill impairment test on October 1, 2010 on the revised reporting units, which are the same as the operating segments. Based on the results of this test, no impairment charge was required.

Page 16 of 21

10. Segmented information (continued)

The following presents information on the Company’s operations based on its management structure. The Company has restated the corresponding items of segmented information for the comparative period to conform to the new management reporting structure.

As at and for the three months

U.S. &

Europe &

ended December 31, 2010

GIS

Canada

India

Asia Pacific

Total

Segment revenue

224,088

468,409

540,009

66,153

1,298,659

Intersegment revenue elimination

(3,470

)

(129,804

)

(32,606

)

(12,091

)

(177,971

)

Revenue

220,618

338,605

507,403

54,062

1,120,688

Net earnings before acquisition- related and integration costs, interest on long-term debt, interest income, other income and income tax expense⁽¹⁾

29,837

71,346

55,714

1,652

158,549

Total assets

514,706

1,738,550

2,122,866

160,370

4,536,492



⁽¹⁾		Amortization included in GIS, Canada, U.S. & India and Europe & Asia Pacific is $21,845,000, $11,205,000, $21,357,000 and $907,000, respectively.


As at and for the three months							U.S. &			Europe &
ended December 31, 2009	GIS			Canada			India			Asia Pacific			Total

	$			$			$			$			$
Segment revenue		227,451			461,668			331,723			65,653			1,086,495
Intersegment revenue elimination		(4,143	)		(124,151	)		(33,135	)		(12,060	)		(173,489	)

Revenue		223,308			337,517			298,588			53,593			913,006

Net earnings before acquisition- related and integration costs, interest on long-term debt, interest income, other income and income tax expense⁽¹⁾		25,060			58,864			35,023			489			119,436

Total assets		653,498			1,885,426			1,055,335			190,972			3,785,231



⁽¹⁾		Amortization included in GIS, Canada, U.S. & India and Europe & Asia Pacific is $22,736,000, $10,990,000, $14,366,000 and $1,468,000, respectively.

Intersegment revenue are priced as if revenue was from third parties.

Page 17 of 21

11. Guarantees

In the normal course of business, the Company may provide certain clients, principally governmental entities, with bid and performance bonds. In general, the Company would only be liable for the amount of the bid bonds if the Company refuses to perform the project once the bid is awarded. The Company would also be liable for the performance bonds in the event of default in the performance of its obligations. As at December 31, 2010, the Company provided for a total of $57,084,000 of these bonds. To the best of its knowledge, the Company is in compliance with its performance obligations under all service contracts for which there is a performance or bid bond, and the ultimate liability, if any, incurred in connection with these guarantees would not have a materially adverse effect on the Company’s consolidated results of operations or financial condition.

12. Financial instruments and hedges

		The Company uses various financial instruments to manage its exposure to fluctuations in foreign currency exchange rates. The Company does not hold or use any derivative instruments for trading purposes. During the three months ended December 31, 2010, the Company entered into foreign currency forward contracts to hedge the variability in the foreign currency exchange rate between the U.S. dollar and the Indian rupee on future revenue.

		The hedges were documented as cash flow hedges and no component of the derivative instruments’ fair value is excluded from the assessment and measurement of hedge effectiveness.

		The forward contracts are derivative instruments, and, therefore, are recorded at fair value on the balance sheet. Valuation models, such as discounted cash flow analysis using observable market inputs, are utilized to determine the fair values of the forward contracts.

		The effective portion of the change in fair value of the derivative instruments is recognized in other comprehensive income and the ineffective portion, if any, in the consolidated statement of earnings. The effective portion of the change in fair value of the derivatives is reclassified out of other comprehensive income into earnings as an adjustment to revenue when the hedged revenue is recognized. The assessment of effectiveness is based on forward rates utilizing the hypothetical derivative method.

		During the three months ended December 31, 2010, the Company’s hedging relationships were effective.

Page 18 of 21

12. Financial instruments and hedges (continued)

The following table summarizes the fair value of outstanding hedging instruments:

As at December

As at September

31, 2010

30, 2010

Hedge on net investments in self-sustaining foreign subsidiaries

Recorded in

US$886,000 debt designated as the hedging instrument to the Company’s net investment in U.S. subsidiaries (US$920,000 as at September 30, 2010)

Long-term debt

881,216

947,416

€12,000 debt designated as the hedging instrument to the Company’s net investment in European subsidiaries (€12,000 as at September 30, 2010)

Long-term debt

15,983

16,807

Cash flow hedges on future revenue

US$116,970 foreign currency forward contracts to hedge the variability in the expected foreign currency exchange rate between the U.S. dollar and the Canadian dollar (US$130,380 as at September 30, 2010)

Other current assets

8,170

8,918

Other long-term assets

14,258

11,433

US$68,340 foreign currency forward contracts to hedge the variability in the expected foreign currency exchange rate between the U.S. dollar and the Indian rupee (US$44,820 as at September 30, 2010)

Other current assets

1,801

2,378

Other long-term assets

999

1,121

$82,335 foreign currency forward contracts to hedge the variability in the expected foreign currency exchange rate between the Canadian dollar and the Indian rupee ($89,040 as at September 30, 2010)

Accrued liabilities

2,290

1,570

Other long-term liabilities

4,308

3,396

Cash flow hedges on the Senior U.S. unsecured notes

US$107,000 foreign currency forward contracts (US$107,000 as at September 30, 2010)

Other current assets

—

1,277

Other long-term assets

763

Accrued liabilities

1,994

—

The Company expects that approximately $7,768,000 of the accumulated net unrealized gains on all derivative financial instruments designated as cash flow hedges at December 31, 2010 will be reclassified in net income in the next 12 months.

Page 19 of 21

13. Reconciliation of results reported in accordance with Canadian GAAP to U.S. GAAP

The material differences between Canadian and U.S. GAAP affecting the Company’s consolidated financial statements are detailed in the table below. The Company’s most recent annual financial statements describe the circumstances which gave rise to the material differences between Canadian and U.S. GAAP applicable as at September 30, 2010.


	Three months ended December 31

	2010			2009

	$			$
Reconciliation of net earnings:
Net earnings — Canadian GAAP		126,574			111,219
Adjustments for:
Stock-based compensation		(1,007	)		629
Warrants		—			351
Other		(294	)		(23	)

Net earnings — U.S. GAAP		125,273			112,176

Attributable to:
Shareholders of CGI Group Inc.		125,105			111,809
Non-controlling interest		168			367


Basic earnings per share attributable to shareholders of CGI Group Inc. — U.S. GAAP		0.46			0.38
Diluted earnings per share attributable to shareholders of CGI Group Inc. — U.S. GAAP		0.45			0.37


Net earnings — U.S. GAAP		125,273			112,176
Other comprehensive loss		(32,955	)		(17,535	)

Comprehensive income — U.S. GAAP		92,318			94,641

Attributable to:
Shareholders of CGI Group Inc.		92,150			94,274
Non-controlling interest		168			367


	As at December 31,			As at September 30,
	2010			2010

	$			$
Reconciliation of shareholders’ equity:
Equity attributable to shareholders of CGI Group Inc. — Canadian GAAP		2,182,321			2,152,631
Adjustments for:
Stock-based compensation		58,411			58,411
Warrants		(7,125	)		(7,125	)
Reversal of income tax provision		(7,969	)		(7,969	)
Unearned compensation		(3,694	)		(3,694	)
Integration costs		(6,606	)		(6,606	)
Goodwill		28,078			28,078
Income taxes and adjustment for change in accounting policy		9,715			9,715
Other		(3,699	)		(3,405	)

Equity attributable to shareholders of CGI Group Inc. — U.S. GAAP		2,249,432			2,220,036

Equity attributable to non-controlling interest — Canadian and U.S. GAAP		6,620			6,452

Page 20 of 21

13. Reconciliation of results reported in accordance with Canadian GAAP to U.S. GAAP (continued)

		Recent accounting changes

		In October 2009, the FASB issued ASU 2009-13, “Multiple-Deliverable Revenue Arrangements”, which became effective for the Company via prospective application to new arrangements entered into or materially modified on or after October 1, 2010. This standard is equivalent to the corresponding provisions of CICA EIC-175, “Revenue Arrangements with Multiple Deliverables”, (refer to Note 1b).

		Concurrently to issuing ASU 2009-13, the FASB also issued ASU 2009-14, “Certain Revenue Arrangements that Include Software Elements” which became effective for the Company via prospective application at the same date. There is no equivalent under Canadian GAAP, therefore, the Company follows the U.S. guidance (refer to Note 1b).

		The adoption of these above updates did not have any material impact on the Company’s consolidated financial statements. The effects on future periods will depend on the nature and significance of the new or materially modified arrangements in any given period.

Page 21 of 21