6-K

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of October 2006 Commission File Number: 1-31349

THE THOMSON CORPORATION
(Translation of registrant's name into English)

Metro Center, One Station Place
Stamford, Connecticut 06902, United States
(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F o Form 40-F ý

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):           

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):           

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o No ý

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-.

The information contained in Exhibits 99.1 and 99.2 of this Form 6-K is incorporated by reference into, or as additional exhibits to, as applicable, the following Registration Statements of the registrant: Form F-9 (File No. 333-128045); Form F-3 (File No. 333-97203); Form S-8 (File No. 333-12284); Form S-8 (File No. 333-105280); Form S-8 (File No. 333-126782) and Form S-8 (File No. 333-135721).

SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

THE THOMSON CORPORATION
By:	/s/ Deirdre Stanley Name: Deirdre Stanley Title: Senior Vice President and General Counsel

Date: October 27, 2006

EXHIBIT INDEX

Exhibit Number	Description
99.1	Management's Discussion and Analysis
99.2	Unaudited Consolidated Financial Statements
99.3	Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
99.4	Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
99.5	Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.6	Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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SIGNATURES
EXHIBIT INDEX

EX-99.1

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EXHIBIT 99.1

THE THOMSON CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS

The following management's discussion and analysis is intended to assist you in understanding and evaluating changes in our financial condition and operations for the three-month and nine-month periods ended September 30, 2006, compared to the same periods in the preceding year. We recommend that you read this discussion and analysis in conjunction with our consolidated financial statements prepared in accordance with accounting principles generally accepted in Canada, or Canadian GAAP, and the related notes to those financial statements. All dollar amounts in this discussion are in U.S. dollars unless otherwise specified. Unless otherwise indicated, references in this discussion to "we," "our" and "us" are to The Thomson Corporation and its subsidiaries. In addition to historical information, this management's discussion and analysis contains forward-looking statements. Readers are cautioned that these forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from those reflected in the forward-looking statements. Some of these factors include those identified in the section entitled "Forward-Looking Statements" on page 18 of this management's discussion and analysis and in the "Risk Factors" section of our annual information form for the year ended December 31, 2005, which is also contained in our annual report on Form 40-F for the year ended December 31, 2005. This management's discussion and analysis is dated as of October 25, 2006.

OVERVIEW

Our Business and Strategy

We are one of the world's leading information services providers to business and professional customers. Our target customers are knowledge workers whose expertise in particular markets is critical to the success of economies throughout the world. As economies evolve and become more global, we believe that the needs of knowledge workers will continue to grow.

We generate revenues by supplying knowledge workers with business-critical information solutions and services. We make our information more valuable by adding expert analysis, insight and commentary, and couple it with software tools and applications that our customers can use to search, compare, synthesize and communicate the information. To further enhance our customers' workflows, we increasingly deliver information and services electronically, integrate our solutions with our customers' own data and tailor the delivery of information to meet specific customer needs. As we integrate critical information with analysis, tools and applications, we place greater focus on the way our customers use our content, rather than simply on selling the content itself, and are moving from just informing our customers to enabling their decisions. As a global company that provides services in approximately 130 countries, we are affected by economic and market dynamics, governmental regulations and business conditions for each market and country in which we operate.

We organize our operations into four market groups that are structured on the basis of the customers they serve:

•

Thomson Legal & Regulatory



•

Thomson Learning



•

Thomson Financial



•

Thomson Scientific & Healthcare

We also report financial results for a Corporate and Other reporting category, as well as discontinued operations. The Corporate and Other category principally includes corporate expenses, certain costs associated with our stock-related compensation, and, beginning in 2006, costs associated with the company's THOMSONplus business optimization program, which are discussed in the section entitled "THOMSONplus."

The following table summarizes selected financial information for the three-month and nine-month periods ended September 30, 2006 and 2005, including certain metrics that are non-GAAP financial measures. Please see the section below

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entitled "Use of Non-GAAP Financial Measures" for definitions of these terms and references to the reconciliations of these measures to the most directly comparable Canadian GAAP measures.

	Three months ended September 30,					Nine months ended September 30,
(millions of U.S. dollars, except per share amounts)	2006		2005		Change	2006			2005		Change
Consolidated Statement of Earnings Data:
Revenues		2,430		2,304	5%		6,431			6,039	6%
Operating profit		549		516	6%		996			900	11%
Earnings from continuing operations(1)		388		299	30%		741			669	11%
Discontinued operations, net of tax		31		10			(12	)		15
Net earnings(1)		419		309	36%		729			684	7%
Diluted earnings per common share from continuing operations(1)	$	0.60	$	0.46	30%	$	1.14		$	1.02	12%
Diluted earnings per common share(1)	$	0.65	$	0.47	38%	$	1.12		$	1.04	8%
Other Data(2):
Adjusted earnings from continuing operations		391		331	18%		685			535	28%
Adjusted earnings per common share from continuing operations	$	0.61	$	0.50	22%	$	1.06		$	0.82	29%
Free cash flow		461		390	18%		886			775	14%

	As at
	September 30, 2006	December 31, 2005
Consolidated Balance Sheet Data:
Cash and cash equivalents	491	407
Total assets	19,776	19,438
Total long-term liabilities	6,159	6,367
Shareholders' equity	10,193	9,963

(1)

Results are not directly comparable due to certain one-time and other items. For more information, please see the "Results of Operations" section of this management's discussion and analysis.

(2)

These are non-GAAP financial measures. See page 3 for definitions.

Seasonality

We typically derive a much greater portion of our operating profit and operating cash flow in the second half of the year as customer buying patterns are concentrated in the second half of the year, particularly in the learning and regulatory markets. Costs are incurred more evenly throughout the year. As a result, our operating margins generally increase as the year progresses. For these reasons, it may not be possible to compare the performance of our businesses quarter to consecutive quarter, and our quarterly results should be considered on the basis of results for the whole year or by comparing results in a quarter with the results in the same quarter of the previous year. While we report results quarterly, we view and manage our company from a longer-term perspective.

USE OF NON-GAAP FINANCIAL MEASURES

In addition to our results reported in accordance with Canadian GAAP, we use non-GAAP financial measures as supplemental indicators of our operating performance and financial position. We use these non-GAAP financial measures internally for comparing actual results from one period to another, as well as for future planning purposes. We have historically reported non-GAAP financial results, as we believe their use provides more insight into our performance. The following discussion defines

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the measures that we currently use and explains why we believe they are useful measures of our performance, including our ability to generate cash flow:

•	Adjusted earnings and adjusted earnings per common share from continuing operations.  We measure our earnings attributable to common shares and per share amounts to adjust for non-recurring items, discontinued operations and other items affecting comparability, which we refer to as adjusted earnings from continuing operations and adjusted earnings per common share from continuing operations. We use these measures to assist in comparisons from one period to another. Adjusted earnings per common share from continuing operations do not represent actual earnings per share attributable to shareholders.
	In interim periods, we adjust our reported earnings and earnings per common share to reflect a normalized effective tax rate. Specifically, the normalized effective rate is computed as the estimated full-year effective tax rate applied to the consolidated pre-tax income of the interim period. The reported effective tax rate is based on separate annual effective income tax rates for each taxing jurisdiction that are applied to each interim period's pre-tax income. Because the seasonality of our businesses impacts our geographical mix of profits in interim periods and therefore distorts the reported effective tax rate, we believe that using the expected full-year effective tax rate provides a more meaningful comparison among interim periods. The adjustment to normalize the effective tax rate reallocates estimated full-year income taxes between interim periods, but has no effect on full year income taxes or on cash taxes paid.
	See the reconciliation of this measure to the most directly comparable Canadian GAAP measure on page 5.
•	Net debt.  We measure our net debt, which we define as our total indebtedness, including associated fair value hedging instruments (swaps) on our debt, less cash and cash equivalents. Given that we hedge some of our debt to reduce risk, we include hedging instruments as we believe it provides a better measure of the total obligation associated with our outstanding debt. However, because we intend to hold our debt and related hedges to maturity, we do not consider the associated fair market value of cash flow hedges in our measurements. We reduce gross indebtedness by cash and cash equivalents on the basis that they could be used to pay down debt. See the reconciliation of this measure to the most directly comparable Canadian GAAP measure on page 10.
•	Free cash flow.  We evaluate our operating performance based on free cash flow, which we define as net cash provided by operating activities less capital expenditures, other investing activities and dividends paid on our preference shares. We use free cash flow as a performance measure because it represents cash available to repay debt, pay common dividends and fund new acquisitions. See the reconciliation of this measure to the most directly comparable Canadian GAAP measure on page 13.

These and related measures do not have any standardized meaning prescribed by Canadian GAAP and, therefore, are unlikely to be comparable with the calculation of similar measures used by other companies. You should not view these measures as alternatives to net earnings, total debt, cash flow from operations or other measures of financial performance calculated in accordance with GAAP. We encourage you to review the reconciliations of these non-GAAP financial measures to the most directly comparable Canadian GAAP measure within this management's discussion and analysis.

While in accordance with Canadian GAAP, our definition of segment operating profit may not be comparable to that of other companies. We define segment operating profit as operating profit before the amortization of identifiable intangible assets. We use this measure for our segments because we do not consider amortization to be a controllable operating cost for purposes of assessing the current performance of our segments. We also use segment operating profit margin, which we define as segment operating profit as a percentage of revenues.

THOMSONplus

In the second quarter of 2006, we formally announced the THOMSONplus program. THOMSONplus is a series of initiatives which will allow us to become a more integrated operating company by leveraging assets and infrastructure across all segments of our business. The program is expected to produce cost savings for our businesses by:

•

Streamlining and consolidating certain functions such as finance, accounting and business systems;



•

Leveraging infrastructure and technology for customer contact centers;



•

Establishing low-cost shared service centers;



•

Consolidating certain technology infrastructure operations such as voice and data networks, data centers, storage and desktop support; and



•

Re-engineering certain product development and production functions and realigning particular sales forces within our business segments.

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To accomplish these initiatives, we expect to incur approximately $250 million of expenses through 2009, primarily related to consulting services, technology and restructuring costs. Because THOMSONplus is a corporate program, expenses associated with it are reported within our Corporate and Other segment. At the completion of the program, we anticipate these initiatives will produce annual savings of about $150 million. These savings will largely be driven by improved efficiencies and effectiveness of procurement, supply chain management, financial reporting systems, including the implementation of a common enterprise resource planning system, and platform integration across all market groups.

Because THOMSONplus is a series of initiatives, the timing of these costs and savings may shift between different calendar years. However, based on current estimates, we expect to spend approximately $70 million in 2006, $100 million in 2007, $50 million in 2008 and $30 million in 2009. As a return on this investment, we expect to generate savings of approximately $10 million in 2006, $50 million in 2007, $90 million in 2008 and should reach savings of about $150 million per year by 2009.

In the nine-month period ended September 30, 2006, we incurred approximately $38 million in costs associated with THOMSONplus consisting primarily of consulting fees and severance. We estimate that for this nine-month period, we saved about $5 million from the elimination of certain positions and the relocation of others to lower cost locations.

RESULTS OF OPERATIONS

The following discussion compares our results for the three-month and nine-month periods ended September 30, 2006 and 2005 and provides analyses of results from continuing operations and discontinued operations.

Basis of Analysis

Our results from continuing operations include the performance of acquired businesses from the date of their purchase and exclude results from operations classified as discontinued. Results from operations that qualify as discontinued operations have been reclassified to that category for all periods presented. Please see the section below entitled "Discontinued Operations" for a discussion of these operations. In analyzing the results of our operating segments, we measure the performance of existing businesses and the impact of acquired businesses and foreign currency translation.

The following table summarizes our consolidated results for the periods indicated.

	Three months ended September 30,					Nine months ended September 30,
(millions of U.S. dollars, except per share amounts)	2006		2005		Change	2006		2005		Change
Revenues		2,430		2,304	5%		6,431		6,039	6%
Operating profit		549		516	6%		996		900	11%
Operating profit margin		22.6%		22.4%			15.5%		14.9%
Net earnings		419		309	36%		729		684	7%
Diluted earnings per common share	$	0.65	$	0.47	38%	$	1.12	$	1.04	8%

Revenues.    Revenue for the three-month and nine-month periods ended September 30, 2006 increased 5% and 6%, respectively, compared to the prior year periods comprised of the following:

	Three months	Nine months
•  growth from existing businesses	3%	5%
•  contributions of newly acquired businesses	1%	1%
•  impact from foreign currency translation	1%	0%

For our existing businesses, revenue growth was exhibited in both periods in all four market groups, reflecting customer demand for our integrated solutions, overall growth in the markets we serve and the timing of textbook shipments. Contributions from acquired businesses were primarily related to Quantitative Analytics, Inc. and AFX News in our financial group and MercuryMD in our scientific and healthcare group. See the analysis of our segment results for further discussions of our revenue growth.

Operating profit.    Operating profit for both the three-month and nine-month periods ended September 30, 2006 reflected higher revenues. The operating margins for both periods increased compared to those of the prior year as the effects of scale more than offset higher corporate costs resulting from increased pension and other defined benefit plans expense and costs associated with our THOMSONplus program. See the section entitled "THOMSONplus" for a discussion of the program's initiatives and the section entitled "Corporate and Other" for discussion of its associated costs.

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Depreciation and amortization.    Depreciation expense increased 5% in both the three-month and nine-month periods ended September 30, 2006 compared to the prior year periods. These increases reflected recent acquisitions and capital expenditures. Amortization increased 14% in the three-month period ended September 30, 2006 compared to the prior year period due to the impact of newly acquired assets. Additionally, the three-month period ended September 30, 2005 reflected adjustments associated with the completion of intangible asset valuations.

Net other income.    For the three-month period ended September 30, 2006, other expense primarily related to an accrual established for litigation associated with an equity investment. For the nine-month period ended September 30, 2006, net other income of $36 million primarily related to a gain from the sale of an equity investment. For the three-month and nine-month periods ended September 30, 2005, net other expense primarily related to a loss associated with the early redemption of certain debt.

Income taxes.    Income taxes for the three-month and nine-month periods ended September 30, 2006 and 2005 reflected the mix of taxing jurisdictions in which pre-tax profits and losses were recognized. Because the seasonality in our businesses impacts our geographic mix of pre-tax profits and losses in interim periods and, therefore, distorts our reported tax rate, our effective tax rate in interim periods is not indicative of our estimated effective tax rate for the full year. The tax charge for the three months ended September 30, 2006 included a $10 million charge to write off a deferred tax asset that was deemed no longer realizeable due to a change in interpretation of tax law in the United Kingdom. The tax charge for the nine months ended September 30, 2006 also reflected approximately $15 million of one-time tax benefits, which were recorded in the first quarter, associated with a change in a state tax law and the release of a valuation allowance against a state tax loss carryforward which had previously not been considered realizable. The tax charge in the nine-month period ended September 30, 2005 included a release of $137 million of contingent income tax liabilities based upon the outcome of certain tax audits of prior year periods.

Net earnings and earnings per common share.    For the three-month period ended September 30, 2006, net earnings and diluted earnings per common share increased 36% and 38%, respectively, compared to the prior year period. These increases were primarily a result of higher operating profit, lower income tax expense and gains from the sales of discontinued operations. For the nine-month period ended September 30, 2006, net earnings and diluted earnings per common share increased 7% and 8%, respectively, compared to the prior year period. The increases were primarily the result of higher operating profit and a gain on the sale of an investment, which more than offset the impact of the release of tax contingencies in 2005, as well as a negative impact from discontinued operations in 2006.

The results for each of these periods are not directly comparable because of certain one-time items, the seasonal impact on our interim effective tax rate, as well as the variability in the timing and composition of discontinued operations. The following table presents a summary of our earnings and our diluted earnings per common share from continuing operations for the periods indicated, after adjusting for items affecting comparability in each year.

			Three months ended September 30,						Nine months ended September 30,
(millions of U.S. dollars, except per common share amounts)			2006			2005			2006			2005
Earnings attributable to common shares				418			308			725			681
Adjustments for one-time items:
	Net other expense (income)			5			17			(36	)		14
	Tax on above items			—			1			(1	)		1
		Release of tax credits		—			—			—			(137	)
Interim period effective tax rate normalization				(1	)		15			(15	)		(9	)
Discontinued operations				(31	)		(10	)		12			(15	)
Adjusted earnings from continuing operations				391			331			685			535
Adjusted earnings per common share from continuing operations			$	0.61		$	0.50		$	1.06		$	0.82

On a comparable basis, our adjusted earnings from continuing operations for the three-month and nine-month periods ended September 30, 2006 increased 18% and 28%, respectively. The increases were a result of higher operating profit stemming from higher revenues and lower tax expense, which more than offset the impact of higher pension and other benefit plans expense and costs associated with THOMSONplus initiatives.

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Operating Results by Business Segment

Thomson Legal & Regulatory

	Three months ended September 30,			Nine months ended September 30,
(millions of U.S. dollars)	2006	2005	Change	2006	2005	Change
Revenues	903	843	7%	2,658	2,458	8%
Segment operating profit	278	249	12%	759	677	12%
Segment operating profit margin	30.8%	29.5%		28.6%	27.5%

Results for Thomson Legal & Regulatory reflected stable market conditions and strong demand for our online services. These results also exhibited a continuation of well-established trends as online revenues, as well as revenues from software and services, continued to exhibit growth. For the three-month and nine-month periods ended September 30, 2006, revenues for Thomson Legal & Regulatory increased 7% and 8%, respectively, comprised of the following:

	Three months	Nine months
•  growth from existing businesses	6%	7%
•  contributions of newly acquired businesses	1%	1%
•  impact from foreign currency translation	0%	0%

For the three-month and nine-month periods ended September 30, 2006, growth within our existing businesses reflected the strong performance of online services, consisting primarily of Westlaw, Checkpoint and our international online services, which increased 11% and 10%, respectively, over the comparable prior year periods. For the three-month and nine-month periods of 2006, revenue from sales of software and services increased 5% and 11%, respectively, as a result of higher sales of tax and accounting software products and services at Findlaw. In the three-month period of 2006, revenues from sales of software and services were tempered due to the timing of certain bar review courses. Print product revenues increased due to the timing of shipments. Contributions from acquired businesses reflected the results from several small acquisitions in 2006 that supplemented existing offerings.

Within our North American legal businesses, Westlaw revenue experienced growth in all of its major market segments: law firm, corporate, government and academic due to greater new sales. In the third quarter of 2006, revenues from our BAR/BRI bar review courses declined as a result of a shift to the second quarter in 2006 of course days that occurred in the third quarter in 2005. For the nine-month period of 2006, BAR/BRI bar review revenues increased almost 7%. Within the tax and accounting group, our Checkpoint online service revenue continued to increase significantly as a result of new sales, higher retention rates and continued migration of customers from print to online products. Software revenues increased due to higher sales of our UltraTax and InSource offerings. Outside of North America, online revenues increased, particularly in Europe and Australia, due to higher customer demand for our products and the continued migration of our international customers from CD to online products.

For both the three-month and nine-month periods ended September 30, 2006, the growth in segment operating profit and its corresponding margin was primarily a result of the revenue growth described above. The increase in the segment operating profit margin reflected the effects of scale in our existing businesses and a favorable product mix.

Thomson Learning

	Three months ended September 30,			Nine months ended September 30,
(millions of U.S. dollars)	2006	2005	Change	2006		2005	Change
Revenues	794	776	2%	1,632		1,561	5%
Segment operating profit	250	246	2%	216	*	208	4%
Segment operating profit margin	31.5%	31.7%		13.2%		13.3%

*

Reflects the reclassification of $3 million of charges incurred in the first quarter of 2006 to Corporate and Other. These charges related to the consolidation of certain production and operations functions as part of our THOMSONplus program. See the section entitled "Corporate and Other" for further discussion.

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For the three-month and nine-month periods ended September 30, 2006, revenues for Thomson Learning increased 2% and 5%, respectively, comprised of the following:

	Three months	Nine months
•  growth from existing businesses	1%	4%
•  contributions of newly acquired businesses	0%	0%
•  impact from foreign currency translation	1%	1%

In the Academic group, revenues increased in both periods primarily due to higher sales of custom products, arts and sciences and business and economics titles and trades offerings within our domestic higher education businesses. Revenues also reflected a benefit from the timing of shipments to certain customers of $14 million. Additionally, revenues from our library reference business increased slightly compared to the prior year periods due to higher sales of electronic products.

For the three-month period ended September 30, 2006, revenues for our Lifelong Learning group decreased compared to the prior year due to lower testing and corporate e-training revenues, which more than offset higher revenues from our international businesses. Testing revenues decreased as a result of lower volumes in the academic and association customer segments. Revenues in corporate e-training declined due to lower order volumes. The competitive environment in the corporate e-training market continues to affect our results as it has limited our ability to gain new customers. Revenues for our international businesses increased due to textbook adoptions and growth in our English language teaching business. International textbook adoptions were principally in Canada, Australia and Latin America. Growth in English language teaching reflected increased customer demand.

For the nine-month period ended September 30, 2006, revenues for our Lifelong Learning group increased compared to the prior year due to higher textbook sales from our international businesses and higher testing revenues. For this period, testing volumes increased compared to the prior year period.

For the three-month and nine-month periods ended September 30, 2006, segment operating profit increased primarily due to the increase in revenues. Operating margins for both periods approximated that of the prior year as the effects of scale in our academic group were offset by operating losses in our corporate e-learning business.

Thomson Financial

	Three months ended September 30,			Nine months ended September 30,
(millions of U.S. dollars)	2006	2005	Change	2006	2005	Change
Revenues	505	475	6%	1,489	1,403	6%
Segment operating profit	97	85	14%	268	225	19%
Segment operating profit margin	19.2%	17.9%		18.0%	16.0%

Results for Thomson Financial reflected healthy market conditions worldwide. For both the three-month and nine-month periods ended September 30, 2006, revenues increased 6% comprised of the following:

	Three months	Nine months
•  growth from existing businesses	3%	5%
•  contributions of newly acquired businesses	2%	1%
•  impact from foreign currency translation	1%	0%

In both periods, revenues from existing businesses increased as a result of new sales of Thomson ONE products, as well as higher usage and transaction revenues. Revenues from Thomson ONE products increased across the investment banking, corporate, investment management and institutional equities sectors. Notably, performance in the corporate sector reflected the adoption of Thomson ONE Investor Relations. Increases in revenues from existing businesses were experienced in our three primary geographic regions, the U.S., Europe and Asia. International growth benefited from demand for our webcasting solutions as European and Asian markets are adopting U.S.-style investor relations practices. TradeWeb's overall revenues increased due to higher subscription fees. However, TradeWeb's transaction fees declined as a result of lower trading volumes for its U.S. Treasurys and mortgage-backed securities marketplaces. Revenue growth from existing businesses was also tempered by the discontinuation of a low margin service in the wealth management sector. Results also reflected contributions from Quantitative Analytics, Inc., a provider of financial database integration and analysis solutions that was acquired in March 2006, and AFX News, a real-time financial news agency that was acquired in July 2006.

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Segment operating profit for the three-month and nine-month periods ended September 30, 2006 increased due to the increase in revenues. In both periods, the segment operating profit margin increased due to the effects of scale, efficiency efforts to relocate certain activities to lower cost locations and a decline in depreciation expense as a percentage of revenues as a result of more efficient capital spending.

Thomson Scientific & Healthcare

	Three months ended September 30,			Nine months ended September 30,
(millions of U.S. dollars)	2006	2005	Change	2006		2005	Change
Revenues	233	216	8%	669		633	6%
Segment operating profit	49	41	20%	127	*	110	15%
Segment operating profit margin	21.0%	19.0%		19.0%		17.4%

*

Reflects the reclassification of $2 million of charges incurred in the first quarter of 2006 to Corporate and Other. These charges related to the consolidation of certain editorial and sales functions as part of our THOMSONplus initiative. See the section entitled "Corporate and Other" for further discussion.

Results for Thomson Scientific & Healthcare reflected continuing customer demand for our solutions and services. For the three-month and nine-month periods ended September 30, 2006, revenues increased 8% and 6%, respectively, comprised of the following:

	Three months	Nine months
•  growth from existing businesses	4%	4%
•  contributions of newly acquired businesses	3%	2%
•  impact from foreign currency translation	1%	0%

Growth in revenues from existing businesses in both periods was primarily a result of higher subscription revenues for the Web of Science and Thomson Pharma solutions, as well as increased customer spending for healthcare decision support products. Revenues also benefit from the timing of the release of one of our PDR print products, which occurred in the third quarter of 2006 compared to the second quarter in 2005. These increases were partially offset by lower revenues from our legacy online and print products. Results also reflected contributions from MercuryMD, a provider of mobile information systems serving the healthcare market acquired in May 2006.

In both periods, the growth in segment operating profit compared to the prior year periods reflected higher revenues from our workflow solutions and the benefits from completed and ongoing integration initiatives. Those initiatives have increased operating efficiencies enabling us to control costs and improve the segment operating profit margin. Improvement in the segment operating profit margin also reflected the impact of the timing of the release of a PDR print product.

Corporate and Other

	Three months ended September 30,				Nine months ended September 30,
(millions of U.S. dollars)	2006	2005	Change		2006	2005	Change
Expenses excluding THOMSONplus	37	39	(5%	)	110	95	16%
THOMSONplus	13	—			38	—
Total	50	39	28%		148	95	56%

For the three-month and nine-month periods ended September 30, 2006, Corporate and Other expenses increased 28% and 56%, respectively, compared to the prior year periods. The increases were primarily due to expenses associated with our THOMSONplus program, as well as higher pension and other defined benefit plans expense. The three-month period ended September 30, 2005 also reflected severance and costs associated with a reorganization of certain functions in our human resource department.

For the three-month and nine-month periods ended September 30, 2006, we incurred $13 million and $38 million, respectively, of expenses associated with THOMSONplus. These expenses primarily related to consulting services, but also included severance and losses on vacated leased properties. Additionally, for the nine-month period of 2006, expenses included approximately

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$3 million and $2 million of charges previously reported in Thomson Learning and Thomson Scientific & Healthcare, respectively, in the first quarter of 2006. These charges primarily related to the consolidation of certain production, sales and operations functions and reflected losses on vacated leased property and severance. Our segment results for the first quarter of 2006 have been reclassified to reflect this presentation.

Discontinued Operations

As part of our continuing strategy to optimize our portfolio of businesses to ensure that we are investing in parts of our business that offer the greatest opportunities to achieve growth and returns, management decided to actively pursue the sale of the following businesses. These were classified as discontinued operations within the consolidated financial statements for the three-month and nine-month periods ended September 30, 2006 and 2005. None of these businesses was considered fundamental to our integrated information offerings.

In June 2006, our board of directors approved plans to sell IOB, a Brazilian regulatory business within Thomson Legal & Regulatory, and Thomson Medical Education, a provider of sponsored medical education within Thomson Scientific & Healthcare.

In the first quarter of 2006, we approved plans within Thomson Legal & Regulatory to sell Lawpoint Pty Limited, an Australian provider of print and online regulatory information services; and Law Manager, Inc., a software and services provider. We completed the sale of Law Manager in April and Lawpoint in June.

Also in the first quarter of 2006, we approved plans within Thomson Learning to sell Peterson's, a college preparatory guide; the North American operations of Thomson Education Direct, a consumer-based distance learning career school; and K.G. Saur, a German publisher of biographical and bibliographical reference titles serving the library and academic community. We recorded impairment charges associated with certain of these businesses related to identifiable intangible assets and goodwill of $63 million before taxes in the first half of 2006. We completed the sale of Peterson's in July and K.G. Saur in August.

In December 2005, we approved a plan to sell American Health Consultants (AHC). AHC is a provider of medical education and publisher of medical newsletters, and managed within Thomson Scientific & Healthcare. We completed the sale of AHC in August.

For more information on these discontinued operations, see note 8 to our consolidated financial statements.

LIQUIDITY AND CAPITAL RESOURCES

Financial Position

At September 30, 2006, our total assets were $19,776 million, which represented a 2% increase from $19,438 million at December 31, 2005. This increase was primarily due to an increase in goodwill associated with recent acquisitions and foreign currency translation, which more than offset the effect of depreciation and amortization on long-lived assets. Additionally, accounts receivable balances increased due to the seasonal timing of billings and collections.

Effective January 1, 2006, we adopted Canadian Institute of Charted Accountants (CICA) Handbook Section 1530, Comprehensive Income, CICA Handbook Section 3855, Financial Instruments — Recognition and Measurement and CICA Handbook Section 3865, Hedges. These new Handbook Sections dictate comprehensive requirements for the recognition and measurement of financial instruments, provide standards on when and how hedge accounting may be applied and introduce a new component of equity referred to as comprehensive income. As a result of these adoptions, we recorded all derivative instruments and certain debt instruments at their fair value in our consolidated balance sheet and the unrealized gains and losses on certain derivatives within accumulated other comprehensive income in shareholders' equity in our consolidated balance sheet. Prior period results were not restated. See the section entitled "Accounting Changes" for further discussion.

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Our total assets by market group as of September 30, 2006 and December 31, 2005 were as follows:

	As at September 30, 2006		As at December 31, 2005
(millions in U.S. dollars)	Total assets	Percentage of total assets	Total assets	Percentage of total assets
Thomson Legal & Regulatory	7,368	37%	7,320	38%
Thomson Learning	5,330	27%	5,269	27%
Thomson Financial	3,524	18%	3,346	17%
Thomson Scientific & Healthcare	1,700	9%	1,700	9%
Corporate and Other	1,654	8%	1,440	7%
Discontinued operations	200	1%	363	2%
Total assets	19,776	100%	19,438	100%

The following table presents comparative information related to net debt, shareholders' equity and the ratio of net debt to shareholders' equity:

		As at
(millions of U.S. dollars)		September 30, 2006		December 31, 2005
Short-term indebtedness		519		191
Current portion of long-term debt		276		98
Long-term debt		3,785		3,983
	Total debt	4,580		4,272
Swaps		(332	)	(193	)
	Total debt after swaps	4,248		4,079
Less:
Fair value of cash flow hedges (1)		60		—
Cash and cash equivalents		(491	)	(407	)
Net debt		3,817		3,672
Shareholders' equity		10,193		9,963
Net debt/equity ratio		0.37:1		0.37:1

(1)

Effective January 1, 2006, all derivatives and certain hedged items are recorded at fair value on the balance sheet. See the section entitled "Accounting Changes" for further discussion.

We guarantee certain obligations of our subsidiaries, including borrowings by our subsidiaries under our revolving credit facilities. In August 2006, we amended our credit facility guarantees to replace the two original financial covenants with one new financial covenant. Under the new financial covenant, we must maintain a ratio of total debt as of the last day of each fiscal quarter to adjusted EBITDA (earnings before interest, income taxes, depreciation and amortization and other modifications described in the guarantee) for the last four quarters ended of not more than 4:1. Total debt is adjusted to factor in the impact of swaps and other hedge agreements related to the debt. As of September 30, 2006, we were in compliance with this covenant as the ratio was approximately 1.7:1.

In January 2006, we repaid $50 million of privately placed notes upon their maturity.

In the third quarter of 2005, we completed the early redemption of US$75 million of 7.62% privately placed notes and Cdn$400 million of 6.90% medium-term notes and settled an associated currency swap. A loss of US$23 million was recorded as a result of these redemptions in "Net other (expense) income" in the consolidated statement of earnings, primarily related to early redemption premiums and non-cash write-offs of deferred costs. These redemptions were principally financed by the August 2005 offering of US$400 million of 5.50% debentures due 2035.

In addition to the early redemptions discussed above, in September 2005, we also repaid US$75 million of privately placed notes. In March 2005, we repaid $125 million of floating rate notes upon their maturity.

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The following table displays the changes in our shareholders' equity for the nine months ended September 30, 2006:

(millions of U.S. dollars)
Balance at December 31, 2005	9,963
Earnings attributable to common shares for the nine months ended September 30, 2006	725
Additions to paid in capital related to stock compensation plans	31
Common share issuances	47
Repurchases of common shares — normal course issuer bid	(358	)
Common share dividends declared	(425	)
Net unrealized gains on derivatives that qualify as cash flow hedges(1)	62
Net realized losses on derivatives	2
Change in cumulative translation adjustment	146
Balance at September 30, 2006	10,193

(1)

Effective January 1, 2006, the unrealized gains and losses on certain derivatives that qualify as cash flow hedges are recorded as a component of accumulated other comprehensive income within shareholders' equity in our consolidated balance sheet. See the section entitled "Accounting Changes" for further discussion.

The following table sets forth the ratings that we have received from rating agencies in respect of our outstanding securities as of September 30, 2006.

	Moody's	Standard & Poor's	Dominion Bond Rating Service
Long-term debt	A3	A-	A (low)
Commercial paper	—	—	R-1 (low)
Trend/Outlook	Stable	Stable	Stable

The maturity dates for our long-term debt are well balanced with no significant concentration in any one year. You should be aware that a rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or withdrawal at any time by the assigning rating organization. We cannot assure you that our credit ratings will not be lowered in the future or that rating agencies will not issue adverse commentaries regarding our securities.

At September 30, 2006, the carrying amounts of our total current liabilities exceeded the carrying amounts of our total current assets because current liabilities include deferred revenue. Deferred revenue does not represent a cash obligation, however, but rather an obligation to perform services or deliver products in the future. The costs to fulfill these obligations are included in our operating costs.

Normal Course Issuer Bid

In May 2005, we initiated a normal course issuer bid to repurchase up to 15 million of our common shares. Under this first program, which terminated on May 4, 2006, we repurchased and subsequently cancelled approximately 13.3 million shares for approximately $482 million. The following summarizes our repurchases for this first program.

Three-month period ended	Shares Repurchased	Average Price per Share
June 30, 2005	1,350,000	$	33.58
September 30, 2005	2,250,000	$	37.01
December 31, 2005	3,649,400	$	34.97
March 31, 2006	4,570,600	$	36.83
June 30, 2006	1,470,000	$	39.22
Total	13,290,000	$	36.28

In May 2006, we renewed our normal course issuer bid. Under this second program, we may purchase up to 15 million of our common shares, which will be cancelled. Purchases commenced on May 5, 2006 and will terminate no later than May 4, 2007.

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We may repurchase shares in open market transactions on the Toronto Stock Exchange or the New York Stock Exchange. The following summarizes our repurchases for this second program.

Three-month period ended	Shares Repurchased	Average Price per Share		Number of shares available for repurchase
June 30, 2006	1,640,000	$	39.90
September 30, 2006	1,710,600	$	39.27
Total	3,350,600	$	39.58	11,649,400

Decisions regarding the timing of future repurchases will be based on market conditions, share price and other factors. We may elect to suspend or discontinue the bid at any time. From time to time, when we do not possess material non-public information about ourselves or our securities, we may enter into a pre-defined plan with our broker to allow for the repurchase of shares at times when we ordinarily would not be active in the market due to our own internal trading blackout periods, insider trading rules or otherwise. Any such plans entered into with our broker will be adopted in accordance with applicable Canadian securities laws and the requirements of Rule 10b5-1 under the U.S. Securities Exchange Act of 1934.

Cash Flow

Our principal sources of liquidity are cash provided by our operations, borrowings under our revolving bank credit facilities and our commercial paper program and the issuance of public debt. Our principal uses of cash have been to finance working capital and debt servicing costs, repay debt, and finance dividend payments, capital expenditures and acquisitions. Additionally, as discussed in the section entitled "Normal Course Issuer Bid," we also used our cash to repurchase outstanding common shares in open market transactions.

Operating activities.    Cash provided by our operating activities in the three months ended September 30, 2006 was $633 million compared to $540 million in the prior year. The improvement was primarily the result of higher operating profits. Results for third quarter of 2005 also reflected a contribution to one of our pension plans. Cash provided by our operating activities in the nine months ended September 30, 2006 was $1,329 million compared to $1,200 million in the prior year. The improvement was primarily the result of higher operating profits partially offset by the unfavorable timing of payments for normal operating expenses.

Investing activities.    Cash used in our investing activities in the three months ended September 30, 2006 was $310 million compared to $298 million in the prior year. The increased use of cash was primarily due to greater spending on acquisitions, notably LiveNote Technologies, a provider of transcript and evidence management software to litigators and court reporters, which was acquired in late September 2006. Capital expenditures increased by $20 million due to the timing of spending for technology. The spending for acquisitions and capital expenditures more than offset the receipts from the sales of our discontinued operations. Cash used in our investing activities in the nine months ended September 30, 2006 was $717 million compared to $771 million in the prior year. The decreased use of cash was primarily attributable to tax payments in 2005 of $105 million associated with our sale of Thomson Media. Spending on acquisitions increased in 2006 primarily due to the acquisitions of Quantitative Analytics, Inc., a provider of financial database integration and analysis solutions, in March and LiveNote. Results in 2006 also reflected the proceeds from sales of discontinued operations.

Financing activities.    Cash used in our financing activities was $58 million for the three months ended September 30, 2006 compared to $107 million for the prior year period. The decreased use of cash was due to fewer repurchases of our common shares (see "Normal Course Issuer Bid" above) and greater net commercial paper borrowings, partially offset by higher dividends paid. Results for the third quarter of 2005 also reflected the redemption and issuance of long-term debt discussed in the section entitled "Financial Position." Cash used in our financing activities was $530 million for the nine months ended September 30, 2006 compared to $376 million for the prior year period. The increased use of cash largely reflected our repurchase of common shares (see "Normal Course Issuer Bid" above) and higher dividend payments.

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The following table sets forth our common share dividend activity.

	Three months ended September 30,				Nine months ended September 30,
(millions of U.S. dollars)	2006		2005		2006		2005
Dividends declared	141		131		425		387
Dividends reinvested	(3	)	(3	)	(10	)	(9	)
Dividends paid	138		128		415		378

Free cash flow.    The following table sets forth a calculation of our free cash flow for the three-month and nine-month periods ended September 30, 2006 and 2005:

	Three months ended September 30,				Nine months ended September 30,
(millions of U.S. dollars)	2006		2005		2006		2005
Net cash provided by operating activities	633		540		1,329		1,200
Additions to property and equipment	(155	)	(135	)	(395	)	(389	)
Other investing activities	(14	)	(11	)	(39	)	(25	)
Dividends paid on preference shares	(1	)	(1	)	(4	)	(3	)
Additions to property and equipment of discontinued operations	(2	)	(3	)	(5	)	(8	)
Free cash flow	461		390		886		775

Our free cash flow for the three-month and nine-month periods ended September 30, 2006 increased compared to the prior year primarily due to the impacts of higher operating profit. For the three month period, our free cash flow also reflected greater capital expenditures, which primarily increased due to timing.

Credit facilities and commercial paper program.    As of September 30, 2006, we maintained revolving unsecured credit facilities of $1.6 billion. In September 2006, we increased the limit of our commercial paper program from Cdn$1 billion to US$1.2 billion. Though not contractually required, we view our borrowings under our commercial paper program as a reduction of the amount available to us under our credit facilities. At September 30, 2006, our credit lines and related activity were as follows:

(millions of U.S. dollars)
Credit Lines	Amount Drawn	Commercial Paper Outstanding	Lines Available
1,600	(32)	(509)	1,059

Our facilities are structured such that, if our long-term debt rating was downgraded by Moody's or Standard & Poor's, our facility fee and borrowing costs under our existing multi-year credit facilities may increase, although availability would be unaffected. Conversely, an upgrade in our ratings may reduce our facility fees and borrowing costs.

Debt shelf registration.    In September 2005, we filed a shelf prospectus to issue up to $2 billion of debt securities from time to time. As of September 30, 2006, we had not issued any debt securities under this shelf.

For the foreseeable future, we believe that cash from our operations and available credit facilities are sufficient to fund our future cash dividends, debt service, projected capital expenditures, acquisitions that we pursue in the normal course of business and share repurchases.

Contingencies.    As previously disclosed, we are a defendant in separate lawsuits involving our BAR/BRI business, which is part of Thomson Legal & Regulatory. The matters that we previously disclosed are captioned Rodriguez v. West Publishing Corp. and Kaplan Inc. and Park v. The Thomson Corporation and Thomson Legal & Regulatory Inc. Each alleges violations of U.S. federal antitrust laws. In May 2006, the U.S. District Court for the Central District of California granted class certification for the Rodriguez case and trial is scheduled to begin in February 2007. Class action status has not yet been granted in the Park matter, which was filed in the U.S. District Court for the Southern District of New York. In June 2006, an additional purported class action complaint with substantially identical allegations to the Park matter, which is now captioned Arendas v. The Thomson

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Corporation, West Publishing Corporation d/b/a BAR/BRI and Doe Corporation, was filed in the Circuit Court for the Ninth Judicial Circuit in and for Orange County, Florida, alleging violations of Florida state antitrust law. We continue to defend ourselves vigorously in all of these cases.

In addition to the matters described above, our company is engaged in various legal proceedings and claims that have arisen in the ordinary course of business. Some of these matters are described in our management's discussion and analysis for the year ended December 31, 2005. Except as updated and supplemented above, there have been no material developments to these matters. The outcome of all of the proceedings and claims against our company, including, without limitation, those described above and in our management's discussion and analysis for the year ended December 31, 2005, is subject to future resolution, including the uncertainties of litigation. Based on information currently known by us and after consultation with outside legal counsel, our management believes that the probable ultimate resolution of any such proceedings and claims, individually or in the aggregate, will not have a material adverse effect on our financial condition, taken as a whole.

2006 OUTLOOK

The information in this section is forward-looking and should be read in conjunction with the sections below entitled "Material Assumptions" and "Forward-Looking Statements."

We expect full-year 2006 revenue growth to be in line with our long-term target of 7% to 9%, excluding the effects of currency translation. Full-year 2006 revenue growth will continue to be driven primarily by growth from existing businesses and supplemented by tactical acquisitions.

Excluding investments in the THOMSONplus program, we expect continued improvement in our operating profit margin in 2006.

We also expect to continue to generate strong free cash flow in 2006.

MATERIAL ASSUMPTIONS

In preparing our 2006 Outlook, our material assumptions were that worldwide macroeconomic conditions would be unchanged in 2006 relative to 2005, a portion of our anticipated 2006 revenue growth would come from $200-$500 million of tactical acquisitions (net of dispositions) made during the year, and that our operating profit margin, excluding the impact of THOMSONplus, would improve in 2006, despite an estimated $39 million increase in pension and other defined benefit plans expense.

RELATED PARTY TRANSACTIONS

As at October 25, 2006, The Woodbridge Company Limited (Woodbridge) and its affiliates together beneficially owned approximately 70% of our common shares.

From time to time, in the normal course of business, Woodbridge and its affiliates purchase some of our products and service offerings. These transactions are negotiated at arm's length on standard terms, including price, and are not significant to our results of operations or financial condition individually or in the aggregate.

In the normal course of business, a Woodbridge-owned company rents office space from one of our subsidiaries. Additionally, a number of our subsidiaries charge a Woodbridge-owned company fees for various administrative services. In 2005, the total amounts charged to Woodbridge for these rentals and services were approximately $2 million.

The employees of Jane's Information Group (Jane's), a business we sold to Woodbridge in April 2001, continue to participate in our United States and United Kingdom defined benefit pension plans as well as the defined contribution plan in the United States. Woodbridge assumed the pension liability associated with the active employees of Jane's as of the date of sale as part of its purchase. Jane's makes proportional contributions to these pension plans as required, and makes matching contributions in accordance with the provisions of the defined contribution plan.

We purchase property and casualty insurance from third party insurers and retain the first $500,000 of each and every claim under the programs via our captive insurance subsidiary. Woodbridge is included in these programs and pays us a premium commensurate with its exposures. In 2005, these premiums were about $45,000, which would approximate the premium charged by a third party insurer for such coverage.

We have an agreement with Woodbridge under our directors' and officers' insurance policy whereby Woodbridge will indemnify up to $100 million of liabilities incurred either by our current and former directors and officers or by our company in providing indemnification to these individuals on substantially the same terms and conditions as an arm's length, commercial arrangement. A third party administrator will manage any claims under the indemnity. We pay Woodbridge an annual fee of $750,000, which is less than the premium that we would have paid for commercial insurance.

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In February 2005, we entered into a contract with Hewitt Associates Inc. to outsource certain human resources administrative functions in order to improve operating and cost efficiencies. When we initially signed the contract, we expected to pay Hewitt an aggregate of $115 million over a five year period. This contract was subsequently renegotiated and extended in September 2006. Under the new terms, we expect to pay Hewitt an aggregate of approximately $165 million over a ten year period. In 2005, we paid Hewitt $5 million for its services. Mr. Denning, one of our directors and chairman of our Human Resources Committee, is also a director of Hewitt. Mr. Denning has not participated in negotiations related to the contract and has refrained from deliberating and voting on the matter by the Human Resources Committee and the board of directors.

SUBSEQUENT EVENTS

In October 2006, we announced a realignment of our company into six new segments effective January 1, 2007. These six segments will be North American Legal, Financial, Scientific, International Legal & Regulatory, Tax & Accounting, and Healthcare. We intend to divest the entirety of our Thomson Learning businesses via three separate sales processes: the sale of NETg, a corporate education and training business; the sale of Prometric, a provider of technology-driven assessment and testing services; and the sale of Thomson's higher education, careers, and library reference businesses.

In October 2006, we announced an agreement to sell NETg to SkillSoft PLC for $285 million, subject to certain adjustments at closing. Under the terms of the acquisition agreement, SkillSoft expects to pay us at least $216 million in cash. The remaining consideration is to be paid to us either through the issuance of 11.1 million SkillSoft American Depositary Shares (ADSs) valued at $6.24 per ADS, or in cash raised by SkillSoft through equity financing. SkillSoft has agreed to use commercially reasonable efforts to pursue such equity financing. This sale is expected to be completed in the second quarter of 2007.

Also in October 2006, we completed the acquisition of Solucient, LLC, an advanced healthcare analytics and information company. Solucient will become part of the Medstat business within the Thomson Scientific & Healthcare group.

ACCOUNTING CHANGES

Financial Instruments and Comprehensive Income

Effective January 1, 2006, we adopted CICA Handbook Section 1530, Comprehensive Income, CICA Handbook Section 3855, Financial Instruments — Recognition and Measurement and CICA Handbook Section 3865, Hedges. These new Handbook Sections provide comprehensive requirements for the recognition and measurement of financial instruments, as well as standards on when and how hedge accounting may be applied. Handbook Section 1530 also introduces a new component of equity referred to as comprehensive income.

Under these new standards, all financial instruments, including derivatives, are included on our consolidated balance sheet and are measured either at fair market value or, in limited circumstances, at cost or amortized cost. Derivatives that qualify as hedging instruments must be designated either as a "cash flow hedge," when the hedged item is a future cash flow, or a "fair value hedge," when the hedged item is a recognized asset or liability. The unrealized gains and losses related to a cash flow hedge are included in other comprehensive income. For a fair value hedge, both the derivative and the hedged item are recorded at fair value in the consolidated balance sheet and the unrealized gains and losses from both items are included in earnings. For derivatives that do not qualify as hedging instruments, unrealized gains and losses are reported in earnings.

In accordance with the provisions of these new standards, we reflected the following adjustments as of January 1, 2006:

•

an increase of $53 million to "Other non-current assets" and "Accumulated other comprehensive income" in the consolidated balance sheet relative to derivative instruments that consisted primarily of interest rate contracts, which convert floating rate debt to fixed rate debt and qualify as cash flow hedges;



•

a reclassification of $5 million from "Other current assets," and $3 million from "Other current liabilities" to "Accumulated other comprehensive income" in the consolidated balance sheet related primarily to previously deferred gains and losses on settled cash flow hedges; and



•

an increase of $16 million to "Other non-current assets" and "Long-term debt" in the consolidated balance sheet related to derivative instruments and their related hedged items. These derivative instruments consist primarily of interest rate contracts to convert fixed rate debt to floating and qualify as fair value hedges.

The adoption of these new standards had no impact on our consolidated statement of earnings and retained earnings. The unrealized gains and losses included in "Accumulated other comprehensive income" were recorded net of taxes, which were nil.

During the three-month period ended September 30, 2006, a net increase of $13 million in unrealized gains for cash flow hedges was reflected in "Accumulated other comprehensive income." The net realized loss in the period previously deferred in "Accumulated other comprehensive income" was less than $1 million. The net increase in fair value in the period of fair value

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hedges and the related hedged items of $10 million was reflected in "Prepaid expenses and other current assets," "Current portion of long-term debt," "Other non-current assets" and "Long-term debt."

During the nine-month period ended September 30, 2006, a net increase of $11 million in unrealized gains for cash flow hedges was reflected in "Accumulated other comprehensive income." The net realized loss in the period previously deferred in "Accumulated other comprehensive income" was $2 million. The net decrease in fair value in the period of fair value hedges and the related hedged items of $4 million was reflected in "Prepaid expenses and other current assets," "Current portion of long-term debt," "Other non-current assets" and "Long-term debt."

As of September 30, 2006, approximately $2 million of net deferred gains in "Accumulated other comprehensive income" were expected to be recognized in earnings over the following twelve months. The remaining net deferred gains in "Accumulated other comprehensive income" were expected to be recognized over a period of up to nine years.

Discontinued Operations

In April 2006, the Emerging Issues Committee (EIC) of the CICA issued Abstract 161, Discontinued Operations (EIC-161). The abstract addresses the appropriateness of allocating interest expense to a discontinued operation and disallows allocations of general corporate overhead. EIC-161 was effective upon its issuance and did not have an impact on our consolidated financial statements.

Stock-Based Compensation

In July 2006, we adopted EIC Abstract 162, Stock-Based Compensation for Employees Eligible to Retire Before the Vesting Date (EIC-162), retroactively to January 1, 2006. The abstract clarifies the proper accounting for stock-based awards granted to employees who either are eligible for retirement at the grant date or will be eligible before the end of the vesting period and continue vesting after, or vest upon, retirement. In such cases, the compensation expense associated with the stock-based award will be recognized over the period from the grant date to the date the employee becomes eligible to retire. EIC-162 did not have an impact on our financial statements for any period in 2006.

CRITICAL ACCOUNTING POLICIES

Please refer to the "Critical Accounting Policies" section of our management's discussion and analysis for the year ended December 31, 2005, which is also contained in our annual report on Form 40-F for the year ended December 31, 2005, for information on accounting policies that we consider critical in preparing our consolidated financial statements. Since the date of our annual management's discussion and analysis and Form 40-F, there have not been any significant changes to these policies, nor have there been any new accounting policies that we would consider critical. The preparation of our financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Our estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. The result of our ongoing evaluation of these estimates forms the basis for making judgments about the carrying values of assets and liabilities and the reported amounts of revenues and expenses that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions. Our critical accounting policies are those that we believe are the most important in portraying our financial condition and results, and require the most subjective judgment and estimates on the part of management.

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ADDITIONAL INFORMATION

Depreciation by Market Group

The following table details depreciation expense by market group for the three-month and nine-month periods ended September 30, 2006 and 2005.

	Three months ended September 30,		Nine months ended September 30,
	2006	2005	2006	2005
Legal & Regulatory	55	49	160	147
Learning	64	62	147	136
Financial	44	42	134	133
Scientific & Healthcare	9	9	27	27
Corporate and Other	2	4	6	8
Total	174	166	474	451

Disclosure Controls and Procedures

Our Chief Executive Officer and Chief Financial Officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in applicable U.S. and Canadian securities laws) as of the end of the period covered by this management's discussion and analysis, have concluded that our disclosure controls and procedures are effective to ensure that all information required to be disclosed by our company in reports that it files or furnishes under the U.S. Securities Exchange Act and applicable Canadian securities laws is (i) recorded, processed, summarized and reported within the time periods specified in the rules and forms of the U.S. Securities and Exchange Commission (SEC) and Canadian securities regulatory authorities and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There was no change in our company's internal control over financial reporting that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Share Capital

As of October 25, 2006, we had outstanding 640,756,333 common shares, 6,000,000 Series II preference shares, 1,117,462 restricted share units and 15,309,556 stock options.

Public Securities Filings

You may access other information about our company, including our annual information form and our other disclosure documents, reports, statements or other information that we file with the Canadian securities regulatory authorities through SEDAR at www.sedar.com and in the United States with the SEC through EDGAR at www.sec.gov.

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QUARTERLY INFORMATION (UNAUDITED)

The following table presents a summary of our consolidated operating results for our eight most recent quarters.

	Quarter ended March 31,						Quarter ended June 30,						Quarter ended September 30,						Quarter ended December 31,
(millions of U.S. dollars, except per common share amounts)
	2006			2005			2006			2005			2006			2005			2005			2004
Revenues		1,900			1,769			2,101			1,966			2,430			2,304			2,344			2,228
Operating profit		142			119			305			265			549			516			547			476
Earnings from continuing operations		174			74			179			296			388			299			250			300
Discontinued operations, net of tax		(37	)		(1	)		(6	)		6			31			10			—			138
Net earnings		137			73			173			302			419			309			250			438
Dividends declared on preference shares		(1	)		(1	)		(2	)		(1	)		(1	)		(1	)		(1	)		(1	)
Earnings attributable to common shares		136			72			171			301			418			308			249			437
Basic earnings (loss) per common share
From continuing operations	$	0.27		$	0.11		$	0.27		$	0.45		$	0.60		$	0.46		$	0.38		$	0.46
From discontinued operations		(0.06	)		—			—			0.01			0.05			0.01			—			0.21
	$	0.21		$	0.11		$	0.27		$	0.46		$	0.65		$	0.47		$	0.38		$	0.67
Diluted earnings (loss) per common share
From continuing operations	$	0.27		$	0.11		$	0.27		$	0.45		$	0.60		$	0.46		$	0.38		$	0.46
From discontinued operations		(0.06	)		—			(0.01	)		0.01			0.05			0.01			—			0.21
	$	0.21		$	0.11		$	0.26		$	0.46		$	0.65		$	0.47		$	0.38		$	0.67

We typically derive a much greater portion of our operating profit in the second half of the year as customer buying patterns are concentrated in the second half of the year, particularly in the learning and regulatory markets. Costs are incurred more evenly throughout the year. As a result, our operating margins generally increase as the year progresses. In general, our year-over-year performance reflected increased operating profit driven by higher revenues from existing businesses and contributions from acquired businesses.

In the quarters ended December 31, 2004, June 30, 2005 and March 31, 2006, earnings from continuing operations and net earnings reflected the recognition of certain tax credits. In the quarter ended December 31, 2005, earnings from continuing operations and net earnings reflected a $125 million tax charge associated with repatriated profits.

FORWARD-LOOKING STATEMENTS

Certain information in this management's discussion and analysis, particularly under the heading "2006 Outlook," are forward-looking statements that are not historical facts but reflect our current expectations regarding future results. Forward-looking statements also include statements about our company's beliefs and expectations related to our THOMSONplus business optimization program, such as management's expectations related to projected costs and anticipated savings. All of these forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. Some of the factors that could cause actual results or events to differ materially from current expectations are: actions of our competitors; failure to fully derive anticipated benefits from our acquisitions; failures or disruptions of our electronic delivery systems or the Internet; failure to meet the special challenges involved in expansion of our operations outside North America; failure of our significant investments in technology to increase our revenues or decrease our operating costs; failure to develop additional products and services to meet our customers' needs, attract new customers or expand into new geographic markets; increased accessibility to free or relatively inexpensive information sources; failure to maintain the availability of information obtained through licensing arrangements and changes in the terms of our licensing arrangements; changes in the general economy; failure to recruit and retain high quality management and key employees; increased self-sufficiency of our customers; inadequate protection of our intellectual property rights; actions or potential actions that could be taken by our principal shareholder; an increase in our effective income tax rate; and impairment of goodwill and identifiable intangible assets. Additional factors are discussed in our materials filed with the securities regulatory authorities in Canada and the United States from time to time, including our annual information form for the year ended December 31, 2005, which is contained in our current annual report on Form 40-F for the year ended December 31, 2005. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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EXHIBIT 99.1

THE THOMSON CORPORATION MANAGEMENT'S DISCUSSION AND ANALYSIS

EX-99.2

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Exhibit 99.2

The Thomson Corporation
Consolidated Statement of Earnings
(unaudited)

		Three months ended September 30,						Nine months ended September 30,
(millions of U.S. dollars, except per common share amounts)		2006			2005 (note 8)			2006			2005 (note 8)
Revenues			2,430			2,304			6,431			6,039
Cost of sales, selling, marketing, general and administrative expenses			(1,632	)		(1,556	)		(4,735	)		(4,463	)
Depreciation			(174	)		(166	)		(474	)		(451	)
Amortization			(75	)		(66	)		(226	)		(225	)
Operating profit			549			516			996			900
Net other (expense) income (note 6)			(5	)		(17	)		36			(14	)
Net interest expense and other financing costs			(60	)		(59	)		(169	)		(169	)
Income taxes (note 7)			(96	)		(141	)		(122	)		(48	)
Earnings from continuing operations			388			299			741			669
Earnings (loss) from discontinued operations, net of tax (note 8)			31			10			(12	)		15
Net earnings			419			309			729			684
Dividends declared on preference shares			(1	)		(1	)		(4	)		(3	)
Earnings attributable to common shares			418			308			725			681
Earnings per common share (note 10):
Basic and diluted earnings per common share:
	From continuing operations	$	0.60		$	0.46		$	1.14		$	1.02
	From discontinued operations	$	0.05		$	0.01		($	0.02	)	$	0.02
Basic and diluted earnings per common share		$	0.65		$	0.47		$	1.12		$	1.04

The related notes form an integral part of these consolidated financial statements.

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The Thomson Corporation
Consolidated Balance Sheet
(unaudited)

(millions of U.S. dollars)		September 30, 2006	December 31, 2005 (note 8)
Assets
Cash and cash equivalents		491	407
Accounts receivable, net of allowances		1,654	1,639
Inventories		323	314
Prepaid expenses and other current assets		363	316
Deferred income taxes		248	248
Current assets of discontinued operations (note 8)		72	86
	Current assets	3,151	3,010
Computer hardware and other property, net		711	757
Computer software, net		733	743
Identifiable intangible assets, net		4,348	4,386
Goodwill		9,299	8,891
Other non-current assets		1,406	1,374
Non-current assets of discontinued operations (note 8)		128	277
Total assets		19,776	19,438
Liabilities and shareholders' equity
Liabilities
Short-term indebtedness		519	191
Accounts payable and accruals		1,501	1,686
Deferred revenue		1,019	994
Current portion of long-term debt		276	98
Current liabilities of discontinued operations (note 8)		109	139
	Current liabilities	3,424	3,108
Long-term debt		3,785	3,983
Other non-current liabilities		824	812
Deferred income taxes		1,530	1,536
Non-current liabilities of discontinued operations (note 8)		20	36
Total liabilities		9,583	9,475
Shareholders' equity
Capital		2,768	2,726
Retained earnings		6,970	6,992
Accumulated other comprehensive income		455	245
Total shareholders' equity		10,193	9,963
Total liabilities and shareholders' equity		19,776	19,438
Contingencies (note 12)

The related notes form an integral part of these consolidated financial statements.

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The Thomson Corporation
Consolidated Statement of Cash Flow
(unaudited)

		Three months ended September 30,				Nine months ended September 30,
(millions of U.S. dollars)		2006		2005 (note 8)		2006		2005 (note 8)
Cash provided by (used in):
Operating activities
Net earnings		419		309		729		684
Remove loss (earnings) from discontinued operations		(31	)	(10	)	12		(15	)
Add back (deduct) items not involving cash:
	Depreciation (note 15)	174		166		474		451
	Amortization	75		66		226		225
	Net gains on disposals of businesses and investments (note 6)	—		(4	)	(44	)	(5	)
	Loss from redemption of debt securities (notes 6 & 14)	—		23		—		23
	Deferred income taxes	(8	)	23		(3	)	26
	Other, net	61		43		208		11
Voluntary pension contribution		—		(11	)	(5	)	(11	)
Changes in working capital and other items (note 15)		(67	)	(71	)	(270	)	(214	)
Cash provided by operating activities — discontinued operations (note 8)		10		6		2		25
Net cash provided by operating activities		633		540		1,329		1,200
Investing activities
Acquisitions, less cash therein (note 13)		(225	)	(149	)	(443	)	(245	)
Proceeds from disposals		—		3		60		4
Capital expenditures, less proceeds from disposals		(155	)	(135	)	(395	)	(389	)
Other investing activities		(14	)	(11	)	(39	)	(25	)
Capital expenditures of discontinued operations (note 8)		(2	)	(3	)	(5	)	(8	)
Proceeds from (income taxes paid on) disposal of discontinued operations (note 8)		86		—		105		(105	)
Cash used in investing activities — discontinued operations (note 8)		—		(3	)	—		(3	)
Net cash used in investing activities		(310	)	(298	)	(717	)	(771	)
Financing activities
Proceeds from debt offerings (note 14)		—		400		—		400
Repayments of debt (note 14)		—		(411	)	(73	)	(556	)
Net borrowings of short-term loan facilities		143		129		299		289
Repurchase of common shares (note 9)		(67	)	(84	)	(358	)	(129	)
Dividends paid on preference shares		(1	)	(1	)	(4	)	(3	)
Dividends paid on common shares		(138	)	(128	)	(415	)	(378	)
Premium on bond redemption		—		(22	)	—		(22	)
Other financing activities		5		10		21		23
Net cash used in financing activities		(58	)	(107	)	(530	)	(376	)
Translation adjustments		2		(2	)	2		(7	)
Increase in cash and cash equivalents		267		133		84		46
Cash and cash equivalents at beginning of period		224		318		407		405
Cash and cash equivalents at end of period		491		451		491		451

The related notes form an integral part of these consolidated financial statements.

21

The Thomson Corporation
Consolidated Statement of Changes in Shareholders' Equity
(unaudited)

(millions of U.S. dollars)		Stated Share Capital*		Contributed Surplus	Total Capital		Retained Earnings		Accumulated Other Comprehensive Income ("AOCI")		Total Retained Earnings and AOCI		Total
Balance, December 31, 2005		2,599		127	2,726		6,992		245		7,237		9,963
Opening balance adjustment for net deferred gain on cash flow hedges (note 4)		—		—	—		—		51		51		51
Balance, January 1, 2006		2,599		127	2,726		6,992		296		7,288		10,014
Comprehensive income:
	Net earnings						729		—		729		729
	Unrecognized net gain on cash flow hedges						—		11		11		11
	Foreign currency translation adjustments						—		167		167		167
	Net gain reclassified to income						—		(19	)	(19	)	(19	)
Comprehensive income							729		159		888		888
Dividends declared on preference shares		—		—	—		(4	)	—		(4	)	(4	)
Dividends declared on common shares		—		—	—		(425	)	—		(425	)	(425	)
Common shares issued under Dividend Reinvestment Plan ("DRIP")		10		—	10		—		—		—		10
Repurchase of common shares (note 9)		(36	)	—	(36	)	(322	)	—		(322	)	(358	)
Effect of stock compensation plans		37		31	68		—		—		—		68
Balance, September 30, 2006		2,610		158	2,768		6,970		455		7,425		10,193

		Stated Share Capital*		Contributed Surplus	Total Capital		Retained Earnings		AOCI		Total Retained Earnings and AOCI		Total
Balance, December 31, 2004		2,588		108	2,696		6,808		458		7,266		9,962
Comprehensive income:
	Net earnings						684		—		684		684
	Foreign currency translation adjustments						—		(185	)	(185	)	(185	)
Comprehensive income							684		(185	)	499		499
Dividends declared on preference shares		—		—	—		(3	)	—		(3	)	(3	)
Dividends declared on common shares		—		—	—		(387	)	—		(387	)	(387	)
Common shares issued under DRIP		9		—	9		—		—		—		9
Repurchase of common shares		(14	)	—	(14	)	(115	)	—		(115	)	(129	)
Effect of stock compensation plans		20		17	37		—		—		—		37
Balance, September 30, 2005		2,603		125	2,728		6,987		273		7,260		9,988

*

Includes both common and preference share capital

The related notes form an integral part of these consolidated financial statements.

22

The Thomson Corporation
Notes to Consolidated Financial Statements (unaudited)
(unless otherwise stated, all amounts are in millions of U.S. dollars)

Note 1: Consolidated Financial Statements

Principles of Consolidation

The unaudited interim consolidated financial statements of The Thomson Corporation ("Thomson" or the "Company") include all controlled companies and are prepared in accordance with accounting principles generally accepted in Canada ("Canadian GAAP"). All intercompany transactions and balances are eliminated on consolidation.

Note 2: Accounting Principles and Methods

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with the requirements of the Canadian Institute of Chartered Accountants ("CICA") Handbook Section 1751, Interim Financial Statements. Accordingly, certain information and footnote disclosure normally included in annual financial statements prepared in accordance with Canadian GAAP have been omitted or condensed. These unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements as at and for the year ended December 31, 2005, as set out in the Company's 2005 Annual Report.

In the opinion of management, the unaudited interim consolidated financial statements include all adjustments (consisting of normal recurring accruals) considered necessary by management to present a fair statement of the results of operations, financial position and cash flows. The consolidated financial statements were prepared using the same accounting policies and methods as those used in the Company's financial statements for the year ended December 31, 2005, except as explained in note 4.

Prior periods have been restated for discontinued operations. Where necessary, certain amounts for 2005 have been reclassified to conform to the current period's presentation. Specifically, the consolidated statement of earnings for the prior period reflects the reclassification of "Equity in net earnings (losses) of associates" to "Net other income." Additionally, certain costs incurred by Thomson Learning and Thomson Scientific & Healthcare in the first quarter of 2006 in connection with the Company's THOMSONplus program were reclassified to Corporate and Other in the Company's segment results. See notes 5 and 17.

Note 3: Seasonality

Typically, a much greater portion of the Company's operating profit and operating cash flow is derived in the second half of the year. Customer buying patterns are concentrated in the second half of the year, particularly in the learning and regulatory markets, while costs are incurred more evenly throughout the year. As a result, operating margins generally increase as the year progresses. For these reasons, the performance of the Company's businesses may not be comparable quarter to consecutive quarter and should be considered on the basis of results for the whole year or by comparing results in a quarter with the results in the same quarter for the previous year.

Note 4: Changes in Accounting Policies

Financial Instruments and Comprehensive Income

Effective January 1, 2006, Thomson adopted CICA Handbook Section 1530, Comprehensive Income, CICA Handbook Section 3855, Financial Instruments — Recognition and Measurement and CICA Handbook Section 3865, Hedges. These new Handbook Sections provide comprehensive requirements for the recognition and measurement of financial instruments, as well as standards on when and how hedge accounting may be applied. Handbook Section 1530 also introduces a new component of equity referred to as comprehensive income.

Under these new standards, all financial instruments, including derivatives, are included on the consolidated balance sheet and are measured either at fair market value or, in limited circumstances, at cost or amortized cost. Derivatives that qualify as hedging instruments must be designated as either a "cash flow hedge," when the hedged item is a future cash flow, or a "fair value hedge," when the hedged item is a recognized asset or liability. The unrealized gains and losses related to a cash flow hedge are included in other comprehensive income. For a fair value hedge, both the derivative and the hedged item are recorded at fair value in the consolidated balance sheet and the unrealized gains and losses from both items are included in earnings. For derivatives that do not qualify as hedging instruments, unrealized gains and losses are reported in earnings.

In accordance with the provisions of these new standards, the Company reflected the following adjustments as of January 1, 2006:

•

an increase of $53 million to "Other non-current assets" and "Accumulated other comprehensive income" in the consolidated balance sheet relative to derivative instruments that consisted primarily of interest rate contracts, which convert floating rate debt to fixed rate debt and qualify as cash flow hedges;

23

•

a reclassification of $5 million from "Other current assets" and $3 million from "Other current liabilities" to "Accumulated other comprehensive income" in the consolidated balance sheet related primarily to previously deferred gains and losses on settled cash flow hedges;



•

an increase of $16 million to "Other non-current assets" and "Long-term debt" in the consolidated balance sheet related to derivative instruments and their related hedged items. These derivative instruments consist primarily of interest rate contracts to convert fixed rate debt to floating and qualify as fair value hedges; and,



•

a presentational reclassification of amounts previously recorded in "Cumulative translation adjustment" to "Accumulated other comprehensive income."

The adoption of these new standards had no impact on the Company's consolidated statement of earnings. The unrealized gains and losses included in "Accumulated other comprehensive income" were recorded net of taxes, which were nil.

During the three-month period ended September 30, 2006, a net increase of $13 million in unrealized gains for cash flow hedges was reflected in "Accumulated other comprehensive income." The net realized loss in the period previously deferred in "Accumulated other comprehensive income" was less than $1 million. The net increase in fair value in the period of fair value hedges and the related hedged items of $10 million was reflected in "Prepaid expenses and other current assets," "Current portion of long-term debt," "Other non-current assets" and "Long-term debt."

During the nine-month period ended September 30, 2006, a net increase of $11 million in unrealized gains for cash flow hedges was reflected in "Accumulated other comprehensive income." The net realized loss in the period previously deferred in "Accumulated other comprehensive income" was $2 million. The net decrease in fair value in the period of fair value hedges and the related hedged items of $4 million was reflected in "Prepaid expenses and other current assets," "Current portion of long-term debt," "Other non-current assets" and "Long-term debt."

As of September 30, 2006, approximately $2 million of net deferred gains in "Accumulated other comprehensive income" were expected to be recognized in earnings over the following twelve months. The remaining net deferred gains in "Accumulated other comprehensive income" were expected to be recognized over a period of up to nine years.

Discontinued Operations

In April 2006, the Emerging Issues Committee of the CICA issued Abstract 161, Discontinued Operations (EIC-161). The abstract addresses the appropriateness of allocating interest expense to a discontinued operation and disallows allocations of general corporate overhead. EIC-161 was effective upon its issuance and did not have an impact on the Company's consolidated financial statements.

Stock-Based Compensation

In July 2006, the Company adopted EIC Abstract 162, Stock-Based Compensation for Employees Eligible to Retire Before the Vesting Date (EIC-162), retroactively to January 1, 2006. The abstract clarifies the proper accounting for stock-based awards granted to employees who either are eligible for retirement at the grant date or will be eligible before the end of the vesting period and continue vesting after, or vest upon, retirement. In such cases, the compensation expense associated with the stock-based award will be recognized over the period from the grant date to the date the employee becomes eligible to retire. EIC-162 did not have an impact on the Company's financial statements for any period in 2006.

Note 5: THOMSONplus Program

In the second quarter of 2006, the Company formally announced the THOMSONplus program. THOMSONplus is a series of initiatives which will allow the Company to become a more integrated operating company by leveraging assets and infrastructure across all segments of its business. The program is expected to produce cost savings for the Company's businesses by:

•

Streamlining and consolidating certain functions such as finance, accounting and business systems;



•

Leveraging infrastructure and technology for customer contact centers;



•

Establishing low-cost shared service centers;



•

Consolidating certain technology infrastructure operations such as voice and data networks, data centers, storage and desktop support; and



•

Re-engineering certain product development and production functions and realigning particular sales forces within the Company's business segments.

To accomplish these initiatives, the Company expects to incur approximately $250 million of expenses through 2009, primarily related to consulting services, technology and restructuring costs. The Company anticipates that approximately 20% to 30% of these expenses will be for severance, lease terminations and other restructuring costs. Because THOMSONplus is a corporate program, expenses associated with it will be reported within the Corporate and Other segment.

24

For the three-month and nine-month periods ended September 30, 2006, the Company incurred $13 million and $38 million, respectively, of expenses associated with THOMSONplus, which were reported within "Cost of sales, selling, marketing, general and administrative expenses" in the consolidated statement of earnings. These expenses primarily related to consulting services, but also included severance and losses on vacated leased properties. Additionally, for the nine-month period of 2006, expenses included approximately $3 million and $2 million of charges previously reported in the Thomson Learning and Thomson Scientific & Healthcare segments, respectively, in the first quarter of 2006. These charges primarily related to the consolidation of certain production, sales and operations functions and reflected vacated leased properties and severance. The Company's segment results for the first quarter of 2006 have been reclassified to reflect this presentation.

For the nine months ended September 30, 2006, the Company recorded $13 million of expenses associated with the restructuring activities of the THOMSONplus program. The liabilities associated with these restructuring activities were not material as of September 30, 2006.

Note 6: Net Other (Expense) Income

During the period, Net Other (Expense) Income includes:

	Three months ended September 30,				Nine months ended September 30,
	2006		2005		2006		2005
Net gains on disposals of businesses and investments	—		4		44		5
Equity in net earnings of associates	—		2		1		4
Loss from redemption of debt securities	—		(23	)	—		(23	)
Other expense	(5	)	—		(9	)	—
Net other (expense) income	(5	)	(17	)	36		(14	)

Net gains on disposals of businesses and investments

For the nine months ended September 30, 2006, net gains on disposals of businesses and investments were comprised primarily of a gain on sale of an equity investment.

Loss from redemption of debt securities

In August and September 2005, the Company recognized a loss associated with the redemption of two outstanding issuances of debt securities with an aggregate carrying value of approximately US$400 million. These losses primarily represent required premiums paid for early extinguishment and non-cash write-offs of deferred costs. See Note 14.

Other expense

For the three and nine months ended September 30, 2006, other expense primarily related to an accrual established for litigation associated with an equity investment.

Note 7: Income Taxes

In the nine months ended September 2005, the Company recognized a tax benefit of $137 million from the release of contingent income tax liabilities. The liabilities were released upon completion of tax audits relating to prior year periods.

Note 8: Discontinued Operations

The following businesses are classified as discontinued operations within the consolidated financial statements for all periods presented. None of the businesses are considered fundamental to the integrated offerings of Thomson.

In the first nine months of 2006, the Company approved plans to dispose of the following businesses:

•

Within the Legal & Regulatory segment, the Company approved plans to dispose of IOB, a Brazilian regulatory business, Lawpoint Pty Limited, an Australian provider of print and online legal information services, and Law Manager, Inc., a software and services provider. The sales of Law Manager and Lawpoint were completed in April and June 2006, respectively.



•

Within the Learning segment, the Company approved plans to dispose of Peterson's, a college preparatory guide, the North American operations of Thomson Education Direct, a consumer-based distance learning career school and K.G. Saur, a German publisher of biographical and bibliographical reference titles serving the library and academic community. The Company recorded impairment charges associated with certain of these businesses related to identifiable intangible assets and goodwill of $63 million before taxes in the first half of 2006. The sales of Peterson's and K.G. Saur were completed in July and August 2006, respectively.

25

•

Within the Scientific & Healthcare segment, the Company approved plans to dispose of businesses that comprise Thomson Medical Education, a provider of sponsored medical education.

In December 2005, the Company approved the plan to dispose of American Health Consultants ("AHC"). AHC is a provider of medical education and publisher of medical newsletters, and was managed within Thomson Scientific & Healthcare. The sale of AHC was completed in August 2006.

For the nine-month period ended September 2006, discontinued operations includes a gain of $21 million associated with currency translation adjustments on disposals which were released from "Accumulated other comprehensive income" in the consolidated balance sheet.

In the nine-month periods ended September 2006 and 2005, discontinued operations also included adjustments to tax liabilities for businesses previously sold. The reserves were reversed in conjunction with the expiration of certain tax audit periods, and are included in "Other" below.

Balance Sheet

	September 30, 2006
	Legal & Regulatory	Learning	Scientific & Healthcare	Total
Current assets:
Accounts receivable, net of allowances	11	1	45	57
Other current assets	5	7	3	15
Total current assets	16	8	48	72
Non-current assets:
Computer hardware and other property	7	8	7	22
Computer software	2	2	—	4
Identifiable intangible assets	14	6	13	33
Goodwill	4	47	17	68
Other non-current assets	1	—	—	1
Total non-current assets	28	63	37	128
Current liabilities:
Accounts payable and accruals	6	8	22	36
Deferred revenue	27	14	17	58
Other current liabilities	15	—	—	15
Total current liabilities	48	22	39	109
Non-current liabilities:
Other non-current liabilities	4	2	2	8
Deferred income taxes	5	—	7	12
Total non-current liabilities	9	2	9	20

26

	December 31, 2005
	Legal & Regulatory	Learning	Scientific & Healthcare	Total
Current assets:
Accounts receivable, net of allowances	18	15	32	65
Other current assets	4	14	3	21
Total current assets	22	29	35	86
Non-current assets:
Computer hardware and other property	8	7	8	23
Computer software	2	4	—	6
Identifiable intangible assets	25	57	16	98
Goodwill	10	99	25	134
Other non-current assets	2	12	2	16
Total non-current assets	47	179	51	277
Current liabilities:
Accounts payable and accruals	9	17	22	48
Deferred revenue	24	27	28	79
Other current liabilities	12	—	—	12
Total current liabilities	45	44	50	139
Non-current liabilities:
Other non-current liabilities	5	3	3	11
Deferred income taxes	5	15	5	25
Total non-current liabilities	10	18	8	36

	Three months ended September 30, 2006
	Legal & Regulatory		Learning		Scientific & Healthcare		Other	Total
Revenues from discontinued operations	10		24		27		—	61
Earnings (loss) from discontinued operations before income taxes	(1	)	5		6		—	10
Gain (loss) on sale of discontinued operations	—		4		40		—	44
Income taxes	—		(5	)	(19	)	1	(23	)
Earnings (loss) from discontinued operations	(1	)	4		27		1	31

	Three months ended September 30, 2005
	Legal & Regulatory		Learning		Scientific & Healthcare		Other	Total
Revenues from discontinued operations	21		34		32		—	87
Earnings (loss) from discontinued operations before income taxes	(1	)	1		6		—	6
Income taxes	—		(1	)	(2	)	7	4
Earnings (loss) from discontinued operations	(1	)	—		4		7	10

27

	Nine months ended September 30, 2006
	Legal & Regulatory		Learning		Scientific & Healthcare		Other		Total
Revenues from discontinued operations	51		89		85		—		225
Earnings (loss) from discontinued operations before income taxes	(6	)	(60	)	16		—		(50	)
Gain (loss) on sale of discontinued operations	5		4		40		(1	)	48
Income taxes	4		2		(22	)	6		(10	)
Earnings (loss) from discontinued operations	3		(54	)	34		5		(12	)

	Nine months ended September 30, 2005
	Legal & Regulatory		Learning		Scientific & Healthcare		Other	Total
Revenues from discontinued operations	59		104		97		—	260
Earnings (loss) from discontinued operations before income taxes	(5	)	(1	)	18		—	12
Income taxes	—		(2	)	(6	)	11	3
Earnings (loss) from discontinued operations	(5	)	(3	)	12		11	15

Proceeds from (income taxes paid on) disposals of discontinued operations within the consolidated statement of cash flow in the nine months ended September 30, 2006 represent cash received from the sale of Lawpoint, Law Manager, Peterson's, K.G. Saur and AHC. The cash outflow from discontinued operations within the consolidated statement of cash flow in the nine months ended September 30, 2005 represent taxes paid related to the 2004 sale of Thomson Media.

Note 9: Normal Course Issuer Bid

In May 2005, the Company initiated a normal course issuer bid to repurchase up to 15 million of its common shares. Under this first program, which terminated on May 4, 2006, the Company repurchased and subsequently cancelled approximately 13.3 million shares at an average price per share of $36.28.

In May 2006, Thomson renewed its normal course issuer bid. Under this second program, the Company may purchase up to an additional 15 million of its common shares, which will be cancelled. Purchases commenced on May 5, 2006 and will terminate no later than May 4, 2007. The Company may repurchase shares in open market transactions on the Toronto Stock Exchange or the New York Stock Exchange. Through September 30, 2006, the Company repurchased approximately 3.4 million shares, at an average price per share of $39.58, under this second program.

For the nine-month period ended September 30, 2006, the Company repurchased a combined total of approximately 9.4 million common shares for approximately $358 million, representing an average cost per share of $38.18. Of the $358 million, $36 million was recorded as a reduction in capital based upon the historical average issuance price of the shares and $322 million was charged to retained earnings.

Decisions regarding the timing of future repurchases will be based on market conditions, share price and other factors. Thomson may elect to suspend or discontinue the bid at any time. From time to time when the Company does not possess material non-public information about its activities or its securities, the Company may enter into a pre-defined plan with its broker to allow for the repurchase of shares at times when the Company ordinarily would not be active in the market due to its own internal trading blackout periods, insider trading rules or otherwise. Any such plans entered into with the Company's broker will be adopted in accordance with applicable Canadian securities laws and the requirements of Rule 10b5-1 under the U.S. Securities Exchange Act of 1934.

Note 10: Earnings per Common Share

Basic earnings per common share are calculated by dividing earnings attributable to common shares by the sum of the weighted-average number of common shares outstanding during the period plus vested deferred share units. Deferred share units represent the amount of common shares certain employees have elected to receive in the future in lieu of cash compensation.

Diluted earnings per common share are calculated using the denominator of the basic calculation described above adjusted to include the potentially dilutive effect of outstanding stock options and other securities. The Company uses the treasury stock method to calculate diluted earnings per common share.

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Earnings used in determining earnings per common share from continuing operations are presented below. Earnings used in determining earnings per common share from discontinued operations are the earnings from discontinued operations as reported within the consolidated statement of earnings.

	Three months ended September 30,				Nine months ended September 30,
	2006		2005		2006		2005
Earnings from continuing operations	388		299		741		669
Dividends declared on preference shares	(1	)	(1	)	(4	)	(3	)
Earnings from continuing operations attributable to common shares	387		298		737		666

The weighted-average number of common shares outstanding, as well as a reconciliation of the weighted-average number of common shares outstanding used in the basic earnings per common share computation to the weighted-average number of common shares outstanding used in the diluted earnings per common share computation, is presented below.

	Three months ended September 30,		Nine months ended September 30,
	2006	2005	2006	2005
Weighted average number of common shares outstanding	641,691,386	653,818,898	644,349,186	654,724,898
Vested deferred share units	692,703	585,180	651,383	566,226
Basic	642,384,089	654,404,078	645,000,569	655,291,124
Effect of stock and other incentive plans	2,035,097	1,297,151	1,734,142	861,460
Diluted	644,419,186	655,701,229	646,734,711	656,152,584

Note 11: Employee Benefit Plans

The Company's net defined benefit plan expense is comprised of the following elements:

	Pensions				Other post-retirement plans
	Three months ended September 30,
	2006		2005		2006	2005
Current service cost	16		13		1	—
Interest cost	36		32		2	3
Expected return on plan assets	(40	)	(38	)	—	—
Amortization of net transition asset	—		(1	)	—	—
Amortization of net actuarial losses	13		8		1	1
Amortization of prior service cost	—		1		—	—
Net defined benefit plan expense	25		15		4	4

	Pensions				Other post-retirement plans
	Nine months ended September 30,
	2006		2005		2006	2005
Current service cost	47		40		2	1
Interest cost	104		97		7	7
Expected return on plan assets	(116	)	(115	)	—	—
Amortization of net transition asset	—		(1	)	—	—
Amortization of net actuarial losses	40		25		3	2
Amortization of prior service cost	1		2		—	—
Net defined benefit plan expense	76		48		12	10

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Note 12: Contingencies

As previously disclosed, the Company is a defendant in separate lawsuits involving its BAR/BRI business, which is part of Thomson Legal & Regulatory. The matters that it previously disclosed are captioned Rodriguez v. West Publishing Corp. and Kaplan Inc. and Park v. The Thomson Corporation and Thomson Legal & Regulatory Inc. Each alleges violations of U.S. federal antitrust laws. In May 2006, the U.S. District Court for the Central District of California granted class certification for the Rodriguez case and trial is scheduled to begin in February 2007. Class action status has not yet been granted in the Park matter, which was filed in the U.S. District Court for the Southern District of New York. In June 2006, an additional purported class action complaint with substantially identical allegations to the Park matter, which is now captioned Arendas v. The Thomson Corporation, West Publishing Corporation d/b/a BAR/BRI and Doe Corporation, was filed in the Circuit Court for the Ninth Judicial Circuit in and for Orange County, Florida, alleging violations of Florida state antitrust law. The Company continues to defend itself vigorously in all of these cases.

In addition to the matters described above, the Company is engaged in various legal proceedings and claims that have arisen in the ordinary course of business. Some of these matters are described in the notes to the Company's financial statements for the year ended December 31, 2005. Except as updated and supplemented above, there have been no material developments to these matters. The outcome of all of the proceedings and claims against the Company, including, without limitation, those described above and in the notes to its financial statements for the year ended December 31, 2005, is subject to future resolution, including the uncertainties of litigation. Based on information currently known by Thomson and after consultation with its legal counsel, management believes that the probable ultimate resolution of any such proceedings and claims, individually or in the aggregate, will not have a material adverse effect on the Company's financial condition, taken as a whole.

Note 13: Acquisitions

The number of transactions completed during the three-month and nine-month periods ended September 30, 2006 and 2005 and the related cash consideration were as follows:

Number of transactions	Three months ended September 30,		Nine months ended September 30,
	2006	2005	2006	2005
Businesses and identifiable intangible assets acquired	12	8	29	25
Contingent consideration payment — TradeWeb LLC	1	1	1	1
Investments in businesses	—	1	1	1

Cash consideration	Three months ended September 30,		Nine months ended September 30,
	2006	2005	2006	2005
Businesses and identifiable intangible assets acquired	175	96	391	192
Contingent consideration payment — TradeWeb LLC	50	50	50	50
Investments in businesses	—	3	2	3
Total acquisitions	225	149	443	245

Included in these acquisitions was the purchase of Quantitative Analytics, Inc., a provider of financial database integration and analysis solutions in March 2006, MercuryMD, Inc., a provider of mobile information systems serving the healthcare market in May 2006 and LiveNote Technologies, a provider of transcript and evidence management software in September 2006.

The value of goodwill and identifiable intangible assets acquired in connection with the businesses and identifiable intangible assets acquired is detailed below.

	Three months ended September 30,		Nine months ended September 30,
	2006	2005	2006	2005
Goodwill	61	51	225	79
Identifiable intangible assets with finite lives	118	55	170	120

All acquisitions have been accounted for using the purchase method and the results of acquired businesses are included in the consolidated financial statements from the dates of acquisition. For acquisitions made during the nine-month period ended

30

September 30, 2006, the majority of the acquired goodwill is not deductible for tax purposes (2005 — deductible). Purchase price allocations related to certain acquisitions may be subject to adjustment pending completion of final valuations.

Additionally, during the three-month and nine-month periods ended September 30, 2006, the Company paid approximately $50 million for the second contingent earnout payment related to the 2004 TradeWeb LLC acquisition as the associated contingency was satisfied. The offset to this earnout payment was an increase to goodwill.

Note 14: Long Term Debt

In January 2006, the Company repaid $50 million of privately placed notes upon their maturity.

In the third quarter of 2005, the Company completed the early redemption of US$75 million of 7.62% privately placed notes and Cdn$400 million of 6.90% medium-term notes and settled an associated currency swap. A loss of US$23 million was recorded as a result of these redemptions in "Net other (expense) income" in the consolidated statement of earnings, primarily related to early redemption premiums and non-cash write-offs of deferred costs. These redemptions were principally financed by the August 2005 offering of US$400 million of 5.50% debentures due 2035.

In addition to the early redemption of debt, in September 2005, the Company also repaid US$75 million of privately placed notes and in March 2005, Thomson repaid US$125 million of floating rate notes.

Note 15: Supplemental Cash Flow Information

The following sets forth the components of depreciation expense:

	Three months ended September 30,		Nine months ended September 30,
	2006	2005	2006	2005
Computer hardware and other property	60	56	179	174
Capitalized software for internal use	74	69	218	205
Pre-publication costs	40	41	77	72
	174	166	474	451

Details of "Changes in working capital and other items" are:

	Three months ended September 30,				Nine months ended September 30,
	2006		2005		2006		2005
Accounts receivable	(202	)	(172	)	24		96
Inventories	26		13		(4	)	(17	)
Prepaid expenses and other current assets	24		19		16		4
Accounts payable and accruals	97		96		(255	)	(168	)
Deferred revenue	(71	)	(95	)	(28	)	(79	)
Income taxes	72		87		(6	)	16
Other	(13	)	(19	)	(17	)	(66	)
	(67	)	(71	)	(270	)	(214	)

Non-cash transactions

In the nine months ended September 30, 2006, the Company issued 552,987 shares to employees in connection with the employee stock purchase plan ("ESPP") initiated in October 2005. This issuance settled the liability for accumulated payroll deductions.

Note 16: Related Party Transactions

As at September 30, 2006, The Woodbridge Company Limited ("Woodbridge") and its affiliates together beneficially owned approximately 70% of the Company's common shares.

From time to time, in the normal course of business, Woodbridge and its affiliates purchase products and service offerings from the Company. These transactions are negotiated at arm's length on standard terms, including price, and are not significant to the Company's results of operations or financial condition either individually or in the aggregate.

In the normal course of business, a Woodbridge-owned company rents office space from one of the Company's subsidiaries. Additionally, a number of the Company's subsidiaries charge a Woodbridge-owned company fees for various administrative

31

services. In the full year of 2005, the total amount charged to Woodbridge for these rentals and services was approximately $2 million.

The employees of Jane's Information Group ("Jane's"), a business sold by the Company to Woodbridge in April 2001, continue to participate in the Company's defined benefit pension plans in the United States and United Kingdom, as well as the defined contribution plan in the United States. Woodbridge assumed the pension liability associated with the active employees of Jane's as of the date of sale as part of its purchase. Jane's makes proportional contributions to these pension plans as required, and makes matching contributions in accordance with the provisions of the defined contribution plan.

Thomson purchases property and casualty insurance from third party insurers and retains the first $500,000 of each and every claim under the programs via the Company's captive insurance subsidiary. Woodbridge is included in these programs and pays Thomson a premium commensurate with its exposures. In 2005, these premiums were approximately $45,000, which would approximate the premium charged by a third party insurer for such coverage.

The Company has an agreement with Woodbridge under its directors' and officers' insurance policy whereby Woodbridge will indemnify up to $100 million of liabilities incurred either by the Company's current and former directors and officers or by the Company in providing indemnification to these individuals on substantially the same terms and conditions as an arm's length, commercial arrangement. A third party administrator will manage any claims under the indemnity. Thomson pays Woodbridge an annual fee of $750,000, which is less than the premium that the Company would have paid for commercial insurance.

In February 2005, the Company entered into a contract with Hewitt Associates Inc. to outsource certain human resources administrative functions in order to improve operating and cost efficiencies. When the Company initially signed the contract, it expected to pay Hewitt an aggregate of $115 million over a five year period. This contract was subsequently renegotiated and extended in September 2006. Under the new terms, the Company expects to pay Hewitt an aggregate of approximately $165 million over a ten year period. In 2005, Thomson paid Hewitt $5 million for its services. Mr. Denning, one of the Company's directors and chairman of the Company's Human Resources Committee, is also a director of Hewitt. Mr. Denning has not participated in negotiations related to the contract and has refrained from deliberating and voting on the matter by the Human Resources Committee and the board of directors.

Note 17: Segment Information

Thomson is a global provider of integrated information solutions for business and professional customers. Thomson operates in four reportable market segments worldwide. The reportable segments of Thomson are strategic business groups that offer products and services to target markets. The accounting policies applied by the segments are the same as those applied by the Company. The Company's four reportable segments are:

Legal & Regulatory

Providing information solutions to legal, tax, accounting, intellectual property, compliance and other business professionals, as well as government agencies.

Learning

Providing learning solutions to colleges, universities, professors, students, libraries, reference centers, government agencies, corporations and professionals.

Financial

Providing products and integration services to financial and technology professionals in the corporate, investment banking, institutional, retail wealth management and fixed income sectors of the global financial community.

Scientific & Healthcare

Providing information and services to researchers, physicians and other professionals in the healthcare, academic, scientific, corporate and government marketplaces.

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Reportable Segments

	Three months ended September 30, 2006				Three months ended September 30, 2005
	Revenues		Segment operating profit		Revenues		Segment operating profit
Legal & Regulatory	903		278		843		249
Learning	794		250		776		246
Financial	505		97		475		85
Scientific & Healthcare	233		49		216		41
Segment totals	2,435		674		2,310		621
Corporate and other1	—		(50	)	—		(39	)
Eliminations	(5	)	—		(6	)	—
Total	2,430		624		2,304		582

	Nine months ended September 30, 2006				Nine months ended September 30, 2005
	Revenues		Segment operating profit		Revenues		Segment operating profit
Legal & Regulatory	2,658		759		2,458		677
Learning	1,632		216		1,561		208
Financial	1,489		268		1,403		225
Scientific & Healthcare	669		127		633		110
Segment totals	6,448		1,370		6,055		1,220
Corporate and other1	—		(148	)	—		(95	)
Eliminations	(17	)	—		(16	)	—
Total	6,431		1,222		6,039		1,125

(1)

Corporate and other includes corporate costs and certain costs associated with the Company's stock compensation plans. Beginning in 2006, costs associated with the Company's THOMSONplus program are included within Corporate and other. For the nine-month period of 2006, included within Corporate and other were approximately $3 million and $2 million of THOMSONplus charges previously reported in Thomson Learning and Thomson Scientific & Healthcare, respectively, in the first quarter of 2006. These charges primarily related to the consolidation of certain production, sales and operations functions and reflected losses on vacated leased property and severance. See Note 5 for further information on THOMSONplus.

In accordance with CICA Handbook Section 1701, Segment Disclosures, the Company discloses information about its reportable segments based upon the measures used by management in assessing the performance of those reportable segments. The Company uses segment operating profit, which is operating profit before amortization of identifiable intangible assets, to measure the operating performance of its segments. Management uses this measure because amortization of identifiable intangible assets is not considered to be a controllable operating cost for purposes of assessing the current performance of the segments. While in accordance with Canadian GAAP, the Company's definition of segment operating profit may not be comparable to that of other companies.

33

The following table reconciles segment operating profit per the reportable segment information to operating profit per the consolidated statement of earnings.

	Three months ended September 30,				Nine months ended September 30,
	2006		2005		2006		2005
Segment operating profit	624		582		1,222		1,125
Less: Amortization	(75	)	(66	)	(226	)	(225	)
Operating profit	549		516		996		900

Note 18: Reconciliation of Canadian to U.S. Generally Accepted Accounting Principles

The consolidated financial statements have been prepared in accordance with Canadian GAAP, which differ in some respects from U.S. GAAP. The following schedules present the material differences within the statement of earnings between Canadian and U.S. GAAP.

			Three months ended September 30,		Nine months ended September 30,
			2006	2005	2006		2005
Net earnings under Canadian GAAP			419	309	729		684
Differences in GAAP increasing (decreasing) reported earnings:
	Business combinations		6	4	14		12
	Derivative instruments and hedging activities		1	1	3		3
	Income taxes		3	20	(23	)	(23	)
Net income under U.S. GAAP			429	334	723		676
Earnings under U.S. GAAP from continuing operations			396	324	733		661
Earnings (loss) under U.S. GAAP from discontinued operations			33	10	(10	)	15
Net income under U.S. GAAP			429	334	723		676
Basic earnings (loss) per common share, under U.S. GAAP, from:
		Continuing operations	$0.61	$0.50	$ 1.13		$1.01
		Discontinued operations, net of tax	$0.06	$0.01	$(0.02	)	$0.02
Basic earnings per common share1			$0.67	$0.51	$ 1.11		$1.03
Diluted earnings (loss) per common share, under U.S. GAAP, from:
Continuing operations			$0.61	$0.50	$ 1.13		$1.01
Discontinued operations, net of tax			$0.05	$0.01	$(0.02	)	$0.02
Diluted earnings per common share1			$0.66	$0.51	$ 1.11		$1.03

(1)

Earnings per common share is calculated after taking into account dividends declared on preference shares.

Descriptions of the nature of the reconciling differences are provided below:

Business Combinations

Prior to January 1, 2001, various differences existed between Canadian and U.S. GAAP for the accounting for business combinations, including the establishment of acquisition-related liabilities. The net increase to income primarily relates to (i) costs that are required to be recorded as operating expenses under U.S. GAAP which, prior to January 1, 2001, were capitalized under Canadian GAAP; (ii) overall decreased amortization charges due to basis differences; and (iii) differences in gain or loss calculations on business disposals resulting from the above factors.

34

Derivative Instruments and Hedging Activities

Under U.S. Statement of Financial Accounting Standards ("FAS") No. 133, Accounting for Derivative Instruments and Hedging Activities as amended by FAS 138, Accounting for Certain Derivative Instruments and Certain Hedging Activities, all derivative instruments are recognized in the balance sheet at their fair values, and changes in fair value are recognized either immediately in earnings or, if the transaction qualifies for hedge accounting, when the transaction being hedged affects earnings. Effective January 1, 2006, the Company adopted the same recognition and measurement principles as allowed under new Canadian GAAP accounting standards as discussed in note 4.

Prior to January 1, 2006, in accordance with Canadian GAAP, the Company disclosed the fair values of derivative instruments in the notes to the annual consolidated financial statements, but did not record such fair values in the consolidated balance sheet, except for derivative instruments that did not qualify as hedges. From January 1, 2004, derivative instruments that did not qualify as hedges were recorded in the balance sheet at fair value, and the change in fair value subsequent to January 1, 2004 was recorded in the income statement. The fair value as of January 1, 2004 was deferred and amortized into earnings in conjunction with the item it previously hedged.

The reconciling items subsequent to that date relate to historical balances due to the fact that the adoption of the standards occurred at a later date for Canadian GAAP.

Income Taxes

Under Canadian GAAP, the Company estimates separate annual effective income tax rates for each taxing jurisdiction and individually applies such rates to the interim period's pre-tax income of each jurisdiction. Under U.S. GAAP, the Company estimates the average annual effective income tax rate, excluding jurisdictions that generate net losses where the Company does not expect to receive a tax benefit, and applies that rate to the Company's interim period pre-tax income excluding the interim period pre-tax loss of those loss jurisdictions.

In June 2006, the Financial Accounting Standards Board (FASB) in the United States issued FASB Interpretation No. 48 (FIN 48), Accounting for Uncertainty in Income Taxes. This interpretation, which is effective January 1, 2007, prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. At this time, the CICA has indicated that Canadian GAAP will not seek to conform to the exact guidance mandated in FIN 48. Therefore, future differences may exist between Canadian and U.S. GAAP for the accounting for uncertain tax positions. The Company is currently assessing the impact of FIN 48 on its results under U.S. GAAP.

The income tax adjustment consists of the following:

	Three months ended September 30,				Nine months ended September 30,
	2006		2005		2006		2005
Additional provision due to different accounting principles described above	5		23		(18	)	(18	)
Tax effect of U.S. GAAP pre-tax reconciling items	(2	)	(3	)	(5	)	(5	)
Total income taxes per reconciliation	3		20		(23	)	(23	)

Employee Future Benefits

In September 2006, the FASB issued Statement No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106 and 32(R) ("FAS 158"). FAS 158 requires an employer to recognize a net liability or asset and an offsetting adjustment to accumulated other comprehensive income to report the funded status of defined benefit pension and other postretirement benefit plans. FAS 158 requires prospective application, and the recognition and disclosure requirements are effective for the Company's year ending December 31, 2006. Additionally, FAS 158 requires employers to measure plan obligations at their year-end balance sheet date, effective for the Company's year ending December 31, 2007. The Company is currently evaluating the impact of FAS 158 on its financial statement disclosures under U.S. GAAP for the year ending December 31, 2006.

Under the provisions of FAS 158 treatment, the Company's reported financial position as of December 31, 2005 under U.S. GAAP would have reflected an increase in net pension related liabilities of $574 million, a decrease in net deferred tax liabilities of $207 million and a decrease in shareholders' equity, reflected in accumulated other comprehensive income, of $367 million. There would have been no impact to reported earnings.

Note 19: Subsequent Events

In October 2006, Thomson announced a realignment of the Company into six new segments effective January 1, 2007. These six segments will be North American Legal, Financial, Scientific, International Legal & Regulatory, Tax & Accounting, and

35

Healthcare. The Company intends to divest the entirety of its Thomson Learning businesses via three separate sales processes: the sale of NETg, a corporate education and training business; the sale of Prometric, a provider of technology-driven assessment and testing services; and the sale of Thomson's higher education, careers, and library reference businesses.

In October 2006, Thomson announced an agreement to sell NETg to SkillSoft PLC for $285 million, subject to certain adjustments at closing. Under the terms of the acquisition agreement, SkillSoft expects to pay the Company at least $216 million in cash. The remaining consideration is to be paid to the Company either through the issuance of 11.1 million SkillSoft American Depositary Shares ("ADSs") valued at $6.24 per ADS, or in cash raised by SkillSoft through equity financing. SkillSoft has agreed to use commercially reasonable efforts to pursue such equity financing. This sale is expected to be completed in the second quarter of 2007.

Also, in October 2006, the Company announced that it completed the acquisition of Solucient, LLC, an advanced healthcare analytics and information company. Solucient will become part of the Medstat business within the Thomson Scientific & Healthcare group.

36

THE THOMSON CORPORATION
Metro Center
One Station Place
Stamford, Connecticut 06902
United States
tel 203.539.8000

Suite 2706, Toronto Dominion Bank Tower
P.O. Box 24, Toronto-Dominion Centre
Toronto, Ontario M5K 1A1
Canada
tel 416.360.8700

www.thomson.com

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Exhibit 99.2

UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

EX-99.3

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EXHIBIT 99.3

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER

I, Richard J. Harrington, President and Chief Executive Officer of The Thomson Corporation, certify that:

1.

I have reviewed this report on Form 6-K of The Thomson Corporation;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c)

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: October 27, 2006

/s/ Richard J. Harrington Richard J. Harrington
President and Chief Executive Officer

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CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER

EX-99.4

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EXHIBIT 99.4

CERTIFICATION OF THE CHIEF FINANCIAL OFFICER

I, Robert D. Daleo, Executive Vice President and Chief Financial Officer of The Thomson Corporation, certify that:

1.

I have reviewed this report on Form 6-K of The Thomson Corporation;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c)

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: October 27, 2006

/s/ Robert D. Daleo Robert D. Daleo
Executive Vice President and Chief Financial Officer

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CERTIFICATION OF THE CHIEF FINANCIAL OFFICER

EX-99.5

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EXHIBIT 99.5

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

        In connection with the report of The Thomson Corporation (the "Corporation") on Form 6-K for the period ended September 30, 2006, as furnished to the Securities and Exchange Commission on the date hereof (the "Report"), I, Richard J. Harrington, President and Chief Executive Officer of the Corporation, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

        1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

        2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

Date: October 27, 2006

/s/ Richard J. Harrington Richard J. Harrington
President and Chief Executive Officer

A signed original of this written statement has been provided to The Thomson Corporation and will be retained by The Thomson Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

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CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

EX-99.6

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EXHIBIT 99.6

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

        In connection with the report of The Thomson Corporation (the "Corporation") on Form 6-K for the period ended September 30, 2006, as furnished to the Securities and Exchange Commission on the date hereof (the "Report"), I, Robert D. Daleo, Executive Vice President and Chief Financial Officer of the Corporation, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

        1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

        2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

Date: October 27, 2006

/s/ Robert D. Daleo Robert D. Daleo
Executive Vice President and Chief Financial Officer

A signed original of this written statement has been provided to The Thomson Corporation and will be retained by The Thomson Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

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CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002