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PEACE ARCH COMMUNITY SERVICES FOUNDATION
NOTES TO FINANCIAL STATEMENTS - MARCH 31, 2015 (Continued
)
1. SIGNIFICANT ACCOUNTING POLICIES (Continued)
(f) Financial Instruments
(i) Measurement of Financial Instruments
Cash and cash equivalents, accounts receivable, and accounts payable and accrued liabilities are
classified as held-for-trading and are measured at fair value. Cash and cash equivalents,
accounts receivable, and accounts payable and accrued liabilities are subsequently measured at
amortized cost. Gains and losses related to periodic revaluation are recorded in income of the
Foundation during the year that they are incurred.
Investments are classified as available-for-sale and are measured at market value. Gains and
losses related to periodic revaluation are recorded in income of the Foundation during the year
that they are incurred.
(ii) Impairment
Financial assets measured at cost are tested for impairment when there are indicators of
impairment. The amount of the write-down is recognized in net revenues and expenses. The
previously recognized impairment loss may be reversed to the extent of the improvement
provided that the resulting carrying value does not exceed the amount that would have been
reported had the impairment not been recognized. The amount of the reversal is recognized in
net income.
(iii) Transaction Costs
The Foundation recognizes its transaction costs in net income in the period incurred. However,
financial instruments that will not be subsequently measured at fair value are adjusted by the
transaction costs that are directly attributable to their origination, issuance or assumption.
2. FINANCIAL INSTRUMENTS
Except as noted below, it is management's opinion that the Foundation is not exposed to significant interest,
currency or credit risks arising from the financial instruments disclosed on the balance sheet.
(a) Interest Rate Risk
Interest rate risk is the risk to the Foundation's earnings that arises from fluctuations in interest rates
and the degree of volatility of these rates. The Foundation does not use derivative instruments to
reduce its exposure to interest rate risk.
The Foundation's operating bank account bears interest at a variable rate as determined by the bank.
The Foundation manages its cash based on its cash flow needs in order to optimize its interest
income and reduce its interest expense. Management expects interest rates to remain relatively
constant for the coming year and, therefore, considers the related risk to be low.