SASKENERGY 2017-18 ANNUAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
b. Basis of consolidation The Corporation’s direct and indirect subsidiaries, which are wholly owned by SaskEnergy, are as follows:
Subsidiary
Principal Activity
Bayhurst Energy Services Corporation
Energy services company Natural gas storage company Natural gas storage company Natural gas transmission company
Bayhurst Gas Limited
BG Storage Inc.
Many Islands Pipe Lines (Canada) Limited Saskatchewan First Call Corporation
Underground infrastructure database company Natural gas transmission and storage company
TransGas Limited
c. Joint arrangements When assessing whether a joint arrangement is in the form of a joint operation or a joint venture, the Corporation considers the arrangement’s structure, legal form and contractual terms as well as any other relevant factors. The existing joint arrangements, which are identified below, are in the form of joint operations as the Corporation has the rights to the assets, and obligations for the liabilities, relating to the arrangements. The consolidated financial statements include the Corporation’s share of jointly controlled assets, incurred liabilities, revenue and expenses as well as any liabilities and expenses incurred directly in respect of its joint arrangements.
Joint Arrangement
Operating Jurisdiction
Interest
Principal Activity
Kisbey Gas Gathering and Processing Facility Saskatchewan, Canada
50.0% 50.0%
Natural gas processing Natural gas storage
Totnes Natural Gas Storage Facility
Saskatchewan, Canada
d. Cash and cash equivalents Bank indebtedness forms part of the Corporation’s cash management and is included as a component of cash and cash equivalents for the purpose of the consolidated statement of cash flows. e. Natural gas in storage held for resale Natural gas in storage is stated at the lower of weighted average cost and net realizable value. Net realizable value is determined using natural gas market prices based on anticipated delivery dates. f. Inventory of supplies Inventory of supplies consist primarily of pipe and general stock for construction and maintenance and are stated at the lower of weighted average cost and net realizable value. Replacement value is used as management’s best estimate of net realizable value. When estimating the net realizable value, the Corporation also considers any obsolescence that may exist due to changes in technology. g. Debt retirement funds Under conditions attached to certain advances from the Province of Saskatchewan’s General Revenue Fund (the Province), the Corporation is required, on an annual basis, to invest an amount equal to one per cent of the related outstanding debt. These investments are referred to as debt retirement funds and are administered by Saskatchewan’s Ministry of Finance. Debt retirement funds are classified as financial instruments and are designated as at fair value through other comprehensive income, which are recorded at fair value in the consolidated statement of financial position. The investment and income earned on the investment is returned to the Corporation upon maturity of the related debt.
53
Made with FlippingBook Ebook Creator