XML 47 R21.htm IDEA: XBRL DOCUMENT v2.4.0.6
FAIR VALUE ACCOUNTING
 12 Months Ended
Dec. 31, 2011
FAIR VALUE ACCOUNTING  
FAIR VALUE ACCOUNTING

 

NOTE 15 FAIR VALUE ACCOUNTING

        Fair value accounting establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below:

Level 1   Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2
 
Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and

Level 3
 
Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

        The following table sets forth the Company's assets and liabilities measured at fair value on a recurring basis (at least annually) by level within the fair value hierarchy. As required by accounting guidance, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

 
   Fair Value as at December 31, 2011  
 
   Total   Level 1   Level 2   Level 3  
 
   (in thousands)
  

Assets:

                          

Cash and cash equivalents

   $ 13,416   $ 13,416   $ —   $ —  

Short-term investments

     3,933     3,933     —     —  

Marketable equity securities

     1,480     897     583     —  
                   

 

   $ 18,829   $ 18,246   $ 583   $ —  
                   

Liabilities:

                          

Accounts payable and accrued liabilities

   $ 5,612   $ 5,612   $ —   $ —  

 

 
   Fair Value as at December 31, 2010  
 
   Total   Level 1   Level 2   Level 3  
 
   (in thousands)
  

Assets:

                          

Cash and cash equivalents

   $ 6,818   $ 6,818   $ —   $ —  

Marketable equity securities

     4,576     3,159     1,417     —  
                   

 

   $ 11,394   $ 9,977   $ 1,417   $ —  
                   

Liabilities:

                          

Accounts payable and accrued liabilities

   $ 2,718   $ 2,718   $ —   $ —  

        The Company's cash and cash equivalents and short-term investments are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. The fair value of these balances approximates the carrying amounts due to the short-term nature and historically negligible credit losses. The cash equivalent instruments that are valued based on quoted market prices in active markets are primarily money market securities.

        The Company's marketable equity securities which are exchange traded are valued using quoted market prices in active markets and as such are classified within Level 1 of the fair value hierarchy. The fair value of the marketable equity securities is calculated as the quoted market price of the marketable equity security multiplied by the quantity of shares held by the Company. The other portion of the Company's marketable equity securities, which are comprised of share purchase warrants not listed on a public exchange are valued using pricing models. Valuation models require a variety of inputs, including strike price, contractual terms, market prices, measures of volatility and interest rate. Because the inputs are derived from observable market data, the other portion of the marketable equity securities is classified within Level 2 of the fair value hierarchy.

        The fair value of accounts payable and accrued liabilities approximates the carrying amounts due to the short-term nature and historically negligible credit losses.