Notes to the Consolidated Financial Statements
68
7. Financial and Derivative Instruments For recurring and non-recurring fair value measurements, the Corporation estimates the price at which an orderly transaction to sell the asset or to transfer the liability would take place between market participants at the reporting date under current market conditions. This requires the Corporation to make certain assumptions, including the principal (or most advantageous) market, the most appropriate valuation technique and the most appropriate valuation premise. The Corporation’s own credit risk and the credit risk of the counterparty are taken into account in determining the fair value of financial assets and liabilities, including derivative instruments. In measuring fair value, the Corporation classifies items according to the fair value hierarchy based on the amount of observable inputs. Level 1 valuations use quoted prices (unadjusted) that are available in active markets for identical assets or liabilities as at the reporting date. Active markets are those in which transactions occur in sufficient frequency and volume to provide ongoing pricing information. Level 2 valuations are based on inputs that are either directly or indirectly observable for the asset or liability as at the reporting date. Inputs include quoted market prices, time, volatility factors and broker quotations which can be substantially observed or corroborated in the marketplace. Level 3 inputs are unobservable for the particular assets and liabilities as at the reporting date. The Corporation did not classify any of its fair value measurements within Level 3. 2026 2025
Fair Value Hierarchy
Carrying Amount Fair Value
Carrying Amount Fair Value
(millions)
Classification
FINANCIAL AND DERIVATIVE ASSETS Cash
$
1 $
1 $
FVTPL
Level 1
2 $
2
167 173
167 173
Trade and other receivables
AC
N/A
171 197
171 197
Debt retirement funds
FVOCI FVTPL
Level 2 Level 2
3
3
Fair value of derivative instruments
5
5
FINANCIAL AND DERIVATIVE LIABILITIES Short-term debt
295 152
295 152
AC AC AC AC
N/A N/A N/A N/A
187 192
187 192
Trade and other payables
16
16
Dividends payable Long-term debt
16
16
1,936
1,707
1,862
1,726
22
22
Fair value of derivative instruments
FVTPL
Level 2
12
12
Classification details: FVTPL - fair value through profit or loss AC - amortized cost
FVOCI - fair value through other comprehensive income
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