Airbus - Financial Statements 2022
2. Notes to the IFRS Consolidated Financial Statements Capital Structure and Financial Instruments
Fair Value Hierarchy Fair value of financial instruments — The fair value of quoted investments is based on current market prices. If the market for financial assets is not active, or in the case of unlisted financial instruments, the Company determines fair values by using generally accepted valuation techniques on the basis of market information available at the end of the reporting period. Derivative instruments are generally managed on the basis of the Company’s net exposure to the credit risk of each particular counterparty and fair value information is provided to the Company’s key management personnel on that basis. For these derivative instruments, the fair value is measured based on the price that would be received to sell a net long position, or transfer a net short position, for a particular credit risk exposure as further described below. Depending on the extent the inputs used to measure fair values rely on observable market data, fair value measurements may be hierarchised according to the following levels of input: Level 1: quoted prices (unadjusted) in active markets for identical assets and liabilities; –
The fair values disclosed for financial instruments accounted for at amortised cost reflect Level 2 input. Otherwise, the Company determines mostly fair values based on Level 1 and Level 2 inputs and to a lesser extent on Level 3 input. Level 3: inputs for the asset or liability that are not based on observable market data – fair values measured based on Level 3 input rely to a significant extent on estimates derived from the Company’s own data and may require the use of assumptions that are inherently judgemental and involve various limitations. – Level 2: inputs other than quoted prices that are observable for the asset or liability – fair values measured based on Level 2 input typically rely on observable market data such as interest rates, foreign exchange rates, credit spreads or volatilities; –
The following table presents the carrying amounts of the financial instruments held for the three levels of the fair value hierarchy as of 31 December 2022 and 2021, respectively:
2022
2021
Level 1 Level 2 Level 3
Total
Level 1 Level 2 Level 3
Total
(In € million)
Financial assets measured at fair value
Equity Investments
1,896
0
744
2,640
1,808
0
703
2,511
Derivative instruments
0
1,894
0
1,894
0
1,005
0
1,005
Securities
7,775
0
0
7,775
8,111
0
0
8,111
Customer financing
0
0
86
86
0
0
118
118
Cash equivalents
11,135
1,001
0 12,136 12,075
533
0 12,608
Total
20,806 2,895
830 24,531 21,994 1,538
821 24,353
Financial liabilities measured at fair value
Derivative instruments
0 (9,529)
(84)
(9,613)
0 (4,485)
(78)
(4,563)
Other financial liabilities
0
0
(83)
(83)
0
0
(16)
(16)
Total
0 (9,529)
(167)
(9,696)
0 (4,485)
(94)
(4,579)
80
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