PROPERTY, PLANT AND EQUIPMENT

12 Months Ended

Aug. 31, 2020

Property, plant and equipment [abstract]

PROPERTY, PLANT AND EQUIPMENT [Text Block]

9. PROPERTY, PLANT AND EQUIPMENT

Most of the additions during the year ended August 31, 2020 were related to the expansion of the Company's facility located in Moncton (the "Moncton Campus").

																RIGHT- OF-
										GROWING &						USE LEASE
							CONSTRUCTION			PROCESSING			OTHER			ASSETS
		LAND		BUILDINGS			IN PROCESS			EQUIPMENT			(NOTE A)			(NOTE B)			TOTAL
Cost
Balance, August 31, 2018	$	2,205	$	47,101		$	11,993		$	40,493		$	2,922		$	—		$	104,714
Additions		6		15,753			105,512			5,554			3,366			—			130,191
Construction completed		—		8,042			(51,990	)		42,698			1,250			—			—
Disposals		—		(122	)		—			(201	)		—			—			(323	)
Impairment loss		—		—			—			(613	)		—			—			(613	)
Reclassification of     computer software     (NOTE A)		—		—			—			—			(841	)		—			(841	)
Balance, August 31, 2019	$	2,211	$	70,774		$	65,515		$	87,931		$	6,697		$	—		$	233,128
Accumulated depreciation
Balance, August 31, 2018	$	—	$	(1,997	)	$	—		$	(2,956	)	$	(1,122	)	$	—		$	(6,075	)
Depreciation		—		(2,245	)		—			(5,679	)		(946	)		—			(8,870	)
Disposals		—		5			—			17			—			—			22
Reclassification of     computer software     (NOTE A)		—		—			—			—			265			—			265
Balance, August 31, 2019	$	—	$	(4,237	)	$	—		$	(8,618	)	$	(1,803	)	$	—		$	(14,658	)
Cost
Balance, August 31, 2019	$	2,211	$	70,774		$	65,515		$	87,931		$	6,697		$	—		$	233,128
Transition to IFRS 16		—		—			—			—			—			2,244			2,244
Additions (Note C)		1,864		22,316			46,847			7,597			1,335			2,220			82,179
Construction completed		—		71,663			(110,234	)		37,851			720			—			—
Disposals		—		(517	)		—			(436	)		(75	)		—			(1,028	)
Impairment loss (Note D)		—		(37,214	)		—			48			—			—			(37,166	)
Balance, August 31, 2020	$	4,075	$	127,022		$	2,128		$	132,991		$	8,677		$	4,464		$	279,357
Accumulated depreciation
Balance, August 31, 2019	$	—	$	(4,237	)	$	—		$	(8,618	)	$	(1,803	)	$	—		$	(14,658	)
Depreciation		—		(4,074	)		—			(11,568	)		(1,362	)		(557	)		(17,561	)
Disposals		—		108			—			145			29			—			282
Balance, August 31, 2020	$	—	$	(8,203	)	$	—		$	(20,041	)	$	(3,136	)	$	(557	)	$	(31,937	)
Net book value
August 31, 2019	$	2,211	$	66,537		$	65,515		$	79,313		$	4,894		$	—		$	218,470
August 31, 2020	$	4,075	$	118,819		$	2,128		$	112,950		$	5,541		$	3,907		$	247,420

A) Other - Computer Software

During the three months ended November 30, 2019, the Company determined that due to the increasing value of its computer software, it should be reclassified from property, plant and equipment to intangible assets. Computer software has historically been included in the "other" category within property, plant and equipment due to its relatively insignificant value. The August 31, 2019 cost of $841 and accumulated amortization of $265 relating to computer software have been reclassified from property, plant and equipment to intangible assets (Note 10) as a result.

B) Right-of-Use Assets and Transition to IFRS 16

As described in Note 4, the Company adopted IFRS 16 effective September 1, 2019. As a result, certain lease obligations were capitalized as ROU assets on the transition date and depreciated for the year ended August 31, 2020. ROU assets mostly comprise of office and warehouse space.

C) Reconciliation of property, plant and equipment additions to the statements of cash flows

The following table reconciles additions of property, plant and equipment per the above table to the purchases of property, plant and equipment per the statements of cash flows:

		AUGUST 31, 2020			AUGUST 31, 2019
Additions	$	82,179		$	130,191
Additions related to IFRS 16 Leases		(2,220	)		—
Net change in accounts payable and accrued liabilities related to purchases of property, plant and equipment		(2,736	)		(21,427	)
Purchase of property, plant and equipment	$	77,223		$	108,764

D) Impairment

The Company reviews the carrying value of its property, plant and equipment at each reporting period for indicators of impairment. During the year ended August 31, 2020, management noted indicators of impairment and recorded impairments at an asset specific level.

Moncton Campus - Phase 4C (asset specific)

The construction of Phase 4C of the Moncton Campus, which was intended to house grow rooms with a previously estimated cultivation capacity of 24,000 kg per annum, was indefinitely deferred during the three months ended May 31, 2020 based on available capacity and forecast market demand. Phase 4C of the Moncton Campus has effectively been left partially completed and, due to the specialized and integrated nature of Phase 4C, without any foreseeable near-term use. Management estimated the fair value less cost to dispose ("FVLCD") of Phase 4C to approximate the purchase cost of the land and movable equipment, which is $1,328. As a result, the Company recognized an impairment loss of $37,749 in relation to this asset for the year ended August 31, 2020. The entire amount of the impairment loss was recorded against the building infrastructure of Phase 4C. In addition, subsequently incurred and contractually committed future costs totaling $1,050 with respect to Phase 4C at August 31, 2020 were included in the impairment loss for the year ended August 31, 2020.