Additional Information—Financial Statement Schedule I

Canadian Solar Inc.

Schedule I has been provided pursuant to the requirements of Rule 12-04(a) and 4-08(e)(3) of Regulation S-X, which require condensed financial information as to financial position, changes in financial position and results of operations of a parent company as of the same dates and for the same periods for which audited consolidated financial statements have been presented as the restricted net assets of Canadian Solar Inc.'s consolidated and unconsolidated subsidiaries not available for distribution to Canadian Solar Inc. as of December 31, 2015 of $396,325, exceeded the 25% threshold.

The condensed financial information has been prepared using the same accounting policies as set out in the consolidated financial statements, except that the equity method has been used to account for investments in subsidiaries.

FINANCIAL INFORMATION OF PARENT COMPANY

BALANCE SHEETS

	December 31, 2014			December 31, 2015
	(In Thousands of U.S. Dollars, except share and per share data)
ASSETS
Current assets:
Cash and cash equivalents		3,455			34,206
Restricted cash		—			6,512
Accounts receivable trade, net of allowance for doubtful accounts of $4,302 and $3,852 at December 31, 2014 and 2015, respectively		4,006			2,268
Inventories		443			146
Amounts due from related parties—current		252,570			725,063
Derivative assets—current		—			1,030
Advances to suppliers, net		1,991			226
Prepaid expenses and other current assets		5,852			13,809

Total current assets		268,317			783,260
Investment in subsidiaries		534,849			765,880
Deferred tax assets, net		3,655			2,204
Amount due from related parties—non-current		150,000			—
Other non-current assets		48,219			62,897

TOTAL ASSETS		1,005,040			1,614,241


LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings		—			10,000
Accounts payable		5			8
Amounts due to related parties		99,011			202,359
Derivative liabilities—current		—			27,029
Other current liabilities		6,825			12,661

Total current liabilities		105,841			252,057
Accrued warranty costs		18,273			15,331
Convertible notes		150,000			150,000
Long-term borrowings		—			364,680
Liability for uncertain tax positions		14,315			13,205

TOTAL LIABILITIES		288,429			795,273

Equity:
Common shares—no par value: unlimited authorized shares, 55,161,856 and 55,965,443 shares issued and outstanding at December 31, 2014 and 2015, respectively		675,236			677,103
Additional paid-in capital		(25,682	)		(17,139	)
Retained earnings		46,999			218,860
Accumulated other comprehensive income		20,058			(59,856	)

TOTAL EQUITY		716,611			818,968

TOTAL LIABILITIES AND EQUITY		1,005,040			1,614,241

FINANCIAL INFORMATION OF PARENT COMPANY

STATEMENTS OF OPERATIONS

	Years Ended December 31
	2013			2014			2015
	(In Thousands of U.S. Dollars)
Net revenues		11,802			15,900			23,302
Cost of revenues		5,282			4,401			15,850

Gross profit		6,520			11,499			7,452

Operating expenses:
Selling expenses		3,521			4,000			3,309
General and administrative expenses		5,724			8,331			29,124
Research and development expenses		715			416			450

Total operating expenses		9,960			12,747			32,883

Loss from operations		(3,440	)		(1,248	)		(25,431	)

Other income (expenses):
Interest expense		—			(6,329	)		(17,241	)
Interest income		12,022			10,369			34,471
Loss on change in fair value of derivatives		—			—			(13,571	)
Foreign exchange gain (loss)		(8,455	)		(5,335	)		1,324
Others		427			47			—

Other income (expenses), net:		3,994			(1,248	)		4,983

Profit (loss) before income taxes and equity in earnings (loss) of subsidiaries and unconsolidated investees		554			(2,496	)		(20,448	)
Income tax expense		(1,275	)		(1,005	)		(1,231	)
Equity in earnings of subsidiaries		35,132			243,283			193,813
Equity in loss of unconsolidated investees		(2,752	)		(280	)		(273	)

Net Income		31,659			239,502			171,861

FINANCIAL INFORMATION OF PARENT COMPANY

STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

	Years Ended December 31,
	2013		2014			2015
	(In Thousands of U.S. Dollars)
Net income		31,659		239,502			171,861
Other comprehensive income (net of tax of nil):
Foreign currency translation adjustment		3,116		(33,853	)		(79,913	)

Comprehensive income		34,775		205,649			91,948

FINANCIAL INFORMATION OF PARENT COMPANY

STATEMENTS OF CASH FLOWS

	Years Ended December 31,
	2013			2014			2015
	(In Thousands of U.S. Dollars)
Operating activities:
Net Income		31,659			239,502			171,861
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization		5			1			32
Loss on disposal of property, plant and equipment		—			4			—
Loss on change in fair value of derivatives		—			—			13,571
Allowance for doubtful debts		1,872			11,434			1,535
Equity in earnings of subsidiaries		(35,132	)		(243,283	)		(193,813	)
Equity in loss of unconsolidated investees		2,752			280			273
Share-based compensation		6,175			5,088			5,966
Changes in operating assets and liabilities:
Inventories		2,828			(286	)		296
Accounts receivable trade		627			(5,244	)		2,189
Amounts due from related parties		85,993			3,905			228,284
Advances to suppliers		(283	)		(11,836	)		(226	)
Prepaid expenses and other current assets		8,312			(2,260	)		(7,106	)
Other non-current assets		6,860			(19,727	)		(14,710	)
Accounts payable		9			(9	)		3
Advances from customers		(122	)		(657	)		1,352
Amounts due to related parties		(18,332	)		(42,128	)		103,348
Accrued warranty costs		(14,644	)		84			(2,941	)
Other current liabilities		(2,558	)		3,544			4,484
Liability for uncertain tax positions		142			633			(1,111	)
Deferred taxes		406			1,208			1,451
Net settlement of foreign currency derivatives		—			—			(3,950	)

Net cash provided by (used in) operating activities		76,569			(59,747	)		310,788

Investing activities:
Increase in restricted cash		—			—			(6,513	)
Investment in subsidiaries		(10,602	)		(39,668	)		(116,840	)
Purchases of property, plant and equipment		—			(5	)		—
Funding of loans to subsidiaries		—			(128,213	)		(550,776	)

Net cash used in investing activities		(10,602	)		(167,886	)		(674,129	)

Financing activities:
Proceeds from short-term borrowings		—			—			10,000
Repayment of short-term borrowings		(55,754	)		(12,246	)		—
Proceeds from long-term borrowings		—			—			364,680
Repayment of long-term borrowings		(53,670	)		(16,393	)		—
Proceeds from issuance of warrants		—			—			16,378
Investment on minority shares		—			—			(918	)
Proceeds from issuance of common shares offering		50,000			115,009			—
Issuance costs paid for common shares offering		(2,113	)		(6,090	)		—
Proceeds from issuance of convertible notes		—			150,000			—
Issuance cost paid on convertible notes		—			(5,103	)		—
Proceeds from exercise of stock options		10,793			3,342			1,867

Net cash provided by (used in) financing activities		(50,744	)		228,519			392,007

Effect of exchange rate changes		3,115			(27,016	)		2,085

Net increase (decrease) in cash and cash equivalents		18,338			(26,130	)		30,751
Cash and cash equivalents at the beginning of the year		11,247			29,585			3,455

Cash and cash equivalents at the end of the year		29,585			3,455			34,206

Supplemental disclosure of cash flow information:
Interest paid (net of amounts capitalized)		—			3,942			15,299
Income taxes paid		298			736			—