Non-Consolidated Annual Report 2016

BARBADOS PUBLIC WORKERS’ CO-OPERATIVE CREDIT UNION LIMITED NON-CONSOLIDATED ANNUAL REPORT 2016 72 BARBADOS PUBLIC WORKERS' CO-OPERATIVE CREDIT UNION LIMITED Notes to the Non-consolidated Financial Statements For the year ended March 31, 2016 (Expressed in Barbados dollars) 56 25. Fair Value, continued Determination of fair value and fair value hierarchy The Credit Union uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique: Level 1 : quoted (unadjusted) prices in active markets for identical assets or liabilities. The fair value of financial instruments traded in active markets is based on quoted market prices at the statement of financial position date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. The quoted market price used for financial assets held by the Credit Union is the current bid price. These instruments are included in Level 1. Level 2 : other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly. The fair value of financial instruments that are not traded in an active market (for example, over-the- counter derivatives) is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2. Level 3 : techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data. If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3. The following table presents the Credit Union’s financial instruments that are measured at fair value. 2016 Total Level 1 Level 2 Level 3 balance Investment securities Available-for-sale - Equity securities $ 1,525,000 - 754,438 2,279,438 2015 Total Level 1 Level 2 Level 3 balance Investment securities Available-for-sale - Equity securities $ 1,205,000 - 682,522 1,887,522