(expressed in Eastern Caribbean dollars)
March 31, 2015
Eastern Caribbean Central Bank
Notes to Consolidated Financial Statements
March 31, 2015
(expressed in Eastern Caribbean dollars)
50
3. Financial risk management
…
continued
f) Fair value
…
continued
(i) Financial instruments not measured at fair value
…
continued
Carrying value
Fair value
Off-balance sheet financial instruments
2015
2014
2015
2014
$
$
$
$
Eastern Caribbean Securities Exchange Limited undertaking
and guarantee
–
–
4,874,845
4,874,845
Determination of Fair Value
The following methods and assumptions have been used to estimate the fair value of each class of financial instrument for which it is
practical to estimate a value:
Short-term financial assets and liabilities: The carrying value of these financial assets and liabilities is a reasonable estimate of their
fair value because of the short maturity of these instruments. Short-term financial assets are comprised of regional and foreign
currencies, balances with other central banks, balances with foreign banks, money market instruments and money at call, treasury bills,
balances with local banks, due from participating governments, interest receivable, and accounts receivable. Short-term financial
liabilities are comprised of demand and deposit liabilities
–
domestic and foreign, interest payable and certain other liabilities.
Long-term loans and receivables: The estimated fair value of long-term loans and receivables is based on discounted cash flows using
prevailing market interest rates for debts with similar credit risk and remaining terms to maturity. Some of the financial assets included
in participating government
s’
securities and accounts receivable are long term.
ECCB
ANNUAL REPORT 2014/2015
91
EASTERN CARIBBEAN CENTRAL BANK
3.
Financial risk management
…continued
f) Fair value
…continued
(i) Financial instruments not measured at fair value…continued
Determination of Fair Value
The following methods and assumptions have been used to estimate the fair value of each class of financial instrument for which it is
practical to estimate a value:
Short-term financial assets and liabilities: The carrying value of these financial assets and liabilities is a reasonable estimate
of their fair value because of the short maturity of these instruments. Short-term financial assets are comprised of regional
and foreign currencies, balances with other central banks, balances with foreign banks, money market instruments and
money at call, treasury bills, balances with local banks, due from participating governments, interest receivable, and
accounts receivable. Short-term financial liabilities are comprised of demand and deposit liabilities – domestic and foreign,
interest payable and certain other liabilities.
Long-term loans and receivables: The estimated fair value of long-term loans and receivables is based on discounted cash
flows using prevailing market interest rates for debts with similar credit risk and remaining terms to maturity. Some of the
financial assets included in participating governments’ securities and accounts receivable are long term.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
