BRITISH COLUMBIA HYDRO AND POWER AUTHORITY

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED MARCH 31, 2016 <strong>AND</strong> 2015 British Columbia Hydro and Power Authority The following table reconciles the changes in the balance of financial instruments carried at fair value on the statement of financial position, classified as Level 3, for the years ended March 31, 2016 and 2015: (in millions) Balance at March 31, 2014 $ 43 Cumulative impact of net gain recognized 38 New transactions (3) Existing transactions settled (39) Balance at March 31, 2015 39 Cumulative impact of net gain recognized 21 New transactions (4) Balance at March 31, 2016 $ 56 Level 3 fair values for energy derivatives are determined using inputs that are based on unobservable inputs. Level 3 includes instruments valued using observable prices adjusted for unobservable basis differentials such as delivery location and product quality, instruments which are valued by extrapolation of observable market information into periods for which observable market information is not yet available, and instruments valued using internally developed or non-standard valuation models. During the year, unrealized gains of $22 million (2015 - $42 million gain) were recognized on Level 3 derivative commodity assets still on hand at year end. During the year, unrealized gains of $3 million (2015 - $8 million loss) were recognized on Level 3 derivative commodity liabilities still on hand at year end. These gains and losses are recognized in trade revenues. Methodologies and procedures regarding Powerex’s energy trading Level 3 fair value measurements are determined by Powerex’s Risk Management group. Level 3 fair values are calculated within Powerex’s Risk Management policies for trading activities based on underlying contractual data as well as observable and non-observable inputs. Development of non-observable inputs requires the use of judgment. To ensure reasonability, Level 3 fair value measurements are reviewed and validated by Powerex’s Risk Management and Finance departments on a regular basis.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED MARCH 31, 2016 <strong>AND</strong> 2015 British Columbia Hydro and Power Authority NOTE 20: OTHER NON-CURRENT LIABILITIES (in millions) 2016 2015 Provisions Environmental liabilities $ 390 $ 368 Decommissioning obligations 56 53 Other 10 27 456 448 First Nations liabilities 409 414 Finance lease obligations 240 259 Other liabilities 147 81 Deferred revenue - Skagit River Agreement 463 441 1,715 1,643 Less: Current portion, included in accounts payable and accrued liabilities (122) (129) $ 1,593 $ 1,514 Changes in each class of provision during the financial year are set out below: Environmental Decommissioning Other Total Balance at March 31, 2015 $ 368 $ 53 $ 27 $ 448 Made during the period - - 4 4 Used during the period (27) (4) (21) (52) Changes in estimate 45 6 - 51 Accretion 4 1 - 5 Balance at March 31, 2016 $ 390 $ 56 $ 10 $ 456 Environmental Liabilities The Company has recorded a liability for the estimated future environmental expenditures related to present or past activities of the Company. The Company’s recorded liability is based on management’s best estimate of the present value of the future expenditures expected to be required to comply with existing regulations. There are uncertainties in estimating future environmental costs due to potential external events such as changes in legislation or regulations and advances in remediation technologies. All factors used in estimating the Company’s environmental liabilities represent management’s best estimates of the present value of costs required to meet existing legislation or regulations. Estimated environmental liabilities are reviewed annually or more frequently if significant changes in regulation or other relevant factors occur. Estimate changes are accounted for prospectively. The undiscounted cash flow related to the Company’s environmental liabilities, which will be incurred between fiscal 2017 and 2045, is approximately $453 million and was determined based on current cost estimates. A range of discount rates between 0.5 to 2.1 per cent were used to calculate the net present value of the obligations.
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Report ID: FI307 Workers' Compensat
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NOTE A reconciliation of amounts re
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BRITISH COLUMBIA HYDRO AND POWER AUTHORITY

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