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FINANCIAL INSTRUMENTS
 3 Months Ended
Mar. 31, 2023
FINANCIAL INSTRUMENTS  
Financial Instruments And Risk Management

16. FINANCIAL INSTRUMENTS

 

Fair value

 

The Company’s financial instruments measured at amortized cost as at March 31, 2023 and December 31, 2022 consist of cash, trade and amounts receivable, loans receivable, trade payables, contingencies, accrued liabilities, contingent purchase consideration liabilities, lease liabilities, and debt and loans payable. The amounts reflected in the condensed interim consolidated statements of financial position approximate fair value due to the short-term maturity of these instruments.

 

Financial instruments recorded at the reporting date at fair value are classified into one of three levels based upon the fair value hierarchy. Items are categorized based on inputs used to derive fair value based on:

 

Level 1 - quoted prices that are unadjusted in active markets for identical assets or liabilities

Level 2 - inputs other than quoted prices included in level 1 that are observable for the asset/liability either directly or indirectly; and

Level 3 - inputs for the instruments are not based on any observable market data.

 

The Company’s long-term investments require significant unobservable inputs and as discussed at Note 6, are measured at FVPL and as a Level 3 fair value financial instrument within the fair value hierarchy as at March 31, 2023. As discussed in Note 7, the Company’s contingent purchase considerations consist of the estimated fair value of contingent purchase consideration from the acquisition of JustCBD in February 2022. The amount is measured at FVPL as a Level 2 fair value financial instrument within the fair value hierarchy as at March 31, 2023. As valuations of investments for which market quotations are not readily available are inherently uncertain, may fluctuate within short periods of time and are based on estimates, determination of fair value may differ materially from the values that would have resulted if a ready market existed for the investments. Such changes may have a significant impact on the Company’s financial condition or operating results.

The following tables present information about the Company’s financial instruments and their classifications as at March 31, 2023 and December 31, 2022 and indicate the fair value hierarchy of the valuation inputs utilized to determine such fair value.

 

Fair value measurements at March 31, 2023 using:

 

 

 

 

 

 

 

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Financial assets:

 

 

 

 

 

 

 

 

 

 

 

 

Investments (Note 6)

 

$-

 

 

$-

 

 

$730

 

 

$730

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contingent purchase consideration from business combinations (Note 7)

 

$-

 

 

$3,495

 

 

$-

 

 

$3,495

 

 

Fair value measurements at December 31, 2022 using:

 

 

 

 

 

 

 

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Financial assets:

 

 

 

 

 

 

 

 

 

 

 

 

Investments (Note 6)

 

$-

 

 

$-

 

 

$734

 

 

$734

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contingent purchase consideration from business combinations (Note 7)

 

$-

 

 

$2,645

 

 

$-

 

 

$2,645