Note 15 - Measurement of fair value of financial instruments

Financial instruments at fair value are classified at various levels.

Level 1: Valuation based on quoted prices in an active market
Fair value of financial instruments that are traded in the active markets is based on market price on the balance sheet date. A market is considered active if market prices are easily and regularly available from a stock exchange, dealer, broker, industry group, price-setting service or regulatory authority, and these prices represent actual and regularly occurring market transactions at an arm’s length. This category also includes quoted shares and Treasury bills.

Level 2: Valuation based on observable market data
Level 2 consists of instruments that are valued by the use of information that does not consist in quoted prices, but where the prices are directly or indirectly observable for the assets or liabilities concerned, and which also include quoted prices in non-active markets.

Level 3: Valuation based on other than observable data
If valuation data are not available for level 1 and 2, valuation methods are applied that are based on non-observable information.

The following table presents the Group's assets and liabilities measured at fair value at 30 September 2016: 
         
Assets (NOKm) Level 1 Level 2 Level 3 Total
Financial assets at fair value through profit/loss        
- Derivatives 70 5,419 - 5,489
- Bonds and money market certificates 1,936 14,962 - 16,898
- Equity instruments 622 - 505 1,127
- Fixed interest loans - 43 3,771 3,813
Financial assets avaliable for sale        
- Equity instruments 42 - 84 126
Total assets 2,670 20,423 4,359 27,453
         
Liabilities Level 1 Level 2 Level 3 Total
Financial liabilities through profit/loss        
- Derivatives 58 4,947 - 5,004
- Equity instruments 174 6 - 180
Total liabilities 231 4,953 - 5,184

 

The following table presents the Group's assets and liabilities measured at fair value at 30 September 2015: 
         
Assets (NOKm) Level 1 Level 2 Level 3 Total
Financial assets at fair value through profit/loss        
- Derivatives 64 7,448 - 7,513
- Bonds and money market certificates 1,697 12,732 - 14,430
- Equity instruments 613 - 572 1,184
- Fixed interest loans - 43 4,706 4,749
Financial assets avaliable for sale        
- Equity instruments - - 36 36
Total assets 2,374 20,223 5,314 27,912
         
Liabilities Level 1 Level 2 Level 3 Total
Financial liabilities through profit/loss        
- Derivatives 64 5,421 - 5,486
Total liabilities 64 5,421 - 5,486

 

 

The following table presents the changes in the instruments classified in level 3 as at 30 September 2016: 
         
(NOKm) Fixed interest loans Equity instruments through profit/loss Equity instruments available for sale Total
Opening balance 1 January 4,405 574 108 5,087
Investment in periode 377 24 28 429
Disposals in the periode -991 -70 -3 -1,077
Gain or loss on financial instruments -20 -22 -49 -79
Closing balance 30 September 16 3,771 505 84 4,359

 

 

The following table presents the changes in the instruments classified in level 3 as at 30 September 2015: 
         
(NOKm) Fixed interest loans Equity instruments through profit/loss Equity instruments available for sale Total
Opening balance 1 January 3,277 625 35 3,937
Investment in periode 2,044 9 3 2,056
Disposals in the periode -599 -61 -2 -662
Gain or loss on financial instruments 48 -2 - 47
Change in valuation model for fixed interest loans -64 - - -64
Closing balance 30 September 2015 4,706 572 36 5,314

 

 

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