Management’s Discussion and Analysis
Estimated Unearned Customer Capital Contributions and Contract Liabilities Financial statement reference – Note 16
• At March 31, 2024, the Corporation’s provisions were estimated at $158 million. • A one per cent increase in the discount rate used to determine the provisions would have resulted in a $34 million decrease in provisions at the end of March 31, 2024. • A one per cent decrease would have resulted in a $49 million increase. A provision for remediation is accrued when the occurrence of an environmental expenditure, related to present or past activities of the Corporation, is considered probable and the costs of remedial activities can be reasonably estimated. The fair value of the estimated costs for investigations and remediation at identified sites is recorded as a provision in profit or loss. These provisions are based on management’s best estimate considering current environmental laws and regulations and recorded at fair value. The Corporation reviews its estimates of future environmental expenditures on an ongoing basis. Accounting Policy Changes In 2023-24, the Corporation assessed a number of amendments to IFRS Standards and Interpretations issued by the International Accounting Standards Board (IASB) that are effective for an annual period that begins on or after January 1, 2024. The adoption of applicable amendments had no material impact on the disclosures or on the amounts reported in the financial statements. The IASB also issued new and amended standards that will become effective in future periods. Details on current and future changes in accounting policies are provided within Note 3 of the consolidated financial statements.
Customer capital contributions, related to the construction of new, customer-specific service connections, are recognized as contract liabilities. The Corporation’s customer capital contributions, particularly those related to the transmission system, are often subject to refunds over a certain period. Consequently, when the related property, plant and equipment are available for use, an estimate of the potential refund remains in contract liability until the refund period has passed. At March 31, 2024, the Corporation estimated $22 million of contract liabilities, where the customer has paid a customer capital contribution related to either facilities not yet available for use or amounts subject to refunds in future periods. Estimated Future Costs of Decommissioning Liabilities Financial statement reference – Note 18 The Corporation determines its obligations, legal and constructive, for the future costs of decommissioning certain natural gas facilities by estimating both the associated costs and timing of the necessary cash flows. The timing of future decommissioning is conditional upon the Corporation’s anticipated ongoing use for these facilities, while future decommissioning costs are estimated based on the Corporation’s experience and presented on a discounted basis.
50
Made with FlippingBook Ebook Creator