Notes to the Consolidated Financial Statements
2021
2020
Fair Value Hierarchy
Carrying Amount
Fair Value
Carrying Amount
Fair Value
(millions)
Classification
FINANCIAL AND DERIVATIVE ASSETS Cash
Level 1 $
- $
- $
FVTPL
1 $
1
165 136
165 136
Trade and other receivables
AC Level 2
155 136
155 136
Debt retirement funds
FVOCI FVTPL
Level 2 Level 2
17
17
Fair value of derivative instrument assets
15
15
FINANCIAL AND DERIVATIVE LIABILITIES Short-term debt
264 116
264 116
AC Level 2 AC Level 2 AC Level 2 AC Level 2
279 120
279 120
Trade and other payables
7
7
Dividends payable Long-term debt
2
2
1,485
1,622
1,359
1,532
Fair value of derivative instrument liabilities
8
8
FVTPL
Level 2
21
21
Classification details: FVTPL - fair value through profit or loss
AC - amortized cost FVOCI - fair value through other comprehensive income
The fair value of debt retirement funds is determined by Saskatchewan’s Ministry of Finance using a market approach with information provided by investment dealers. To the extent possible, valuations reflect indicative secondary pricing for these securities. In all other circumstances, valuations are determined with reference to similar actively traded instruments. The fair value of natural gas derivative instruments is determined using a market approach. The Corporation obtains quoted market prices from sources such as the Canadian Gas Price Reporter and the Natural Gas Exchange, independent price publications and over-the-counter broker quotes. The fair value of long-term debt is determined for disclosure purposes only using an income approach. Fair values are estimated using the present value of future cash flows discounted at the market rate of interest for the equivalent Province of Saskatchewan debt instruments. Notional values are an approximation of future undiscounted net cash flows. For physical natural gas contracts, the notional value is based on the contract price. Where contract prices are referenced to an index price that has not yet been fixed, the market price is used to estimate the contract price. As at March 31, 2021 natural gas derivative instruments had the following fair values, notional values and maturities in the next five fiscal years:
(millions)
2022
2023
2024
2025
2026
Total
$ $
$ $
11
Fair value
4 $
4 $
3 $
- $
-
6
Notional value
(7)
$
5 $
5 $
2
$
1
Fair value - increase (decrease) in net income
Notional value - estimated undiscounted net cash (outflow) inflow
Financial assets and liabilities are offset within the consolidated statement of financial position if the Corporation has the legal right to offset and intends to settle on a net basis. When natural gas contracts settle or become realized, the amount due to or from counterparties is recorded within trade payables or trade receivables, respectively.
p.66
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