| TRADING AND AVAILABLE-FOR-SALE SECURITIES AT FAIR VALUE |
TRADING AND AVAILABLE-FOR-SALE SECURITIES AT FAIR VALUE As of December 31, 2022, and March 31, 2022, trading and available-for-sale securities consisted of:
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| |
December 31, 2022 |
|
March 31, 2022 |
| |
|
|
(Recasted) |
| Corporate debt |
$ |
1,097,488 |
|
|
$ |
712,134 |
|
| Non-U.S. sovereign debt |
734,068 |
|
|
360,570 |
|
| Corporate equity |
62,351 |
|
|
72,354 |
|
| U.S. sovereign debt |
34,012 |
|
|
10,435 |
|
| Exchange traded notes |
1,921 |
|
|
2,884 |
|
| Total trading securities |
$ |
1,929,840
|
|
|
$ |
1,158,377
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2022 |
|
March 31, 2022 |
|
|
|
(Recasted) |
| Corporate debt |
$ |
157,548 |
|
|
$ |
145,837 |
|
| Non-U.S. sovereign debt |
12,905 |
|
|
12,997 |
|
| U.S. sovereign debt |
3,873 |
|
|
2,530 |
|
| Total available-for-sale securities, at fair value |
$ |
174,326
|
|
|
$ |
161,364
|
|
The following tables present maturity analysis for available-for-sale securities as of December 31, 2022, and March 31, 2022:
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December 31, 2022 |
|
Remaining contractual maturity of the agreements |
|
Up to 1 year |
|
1-5 years |
|
5-10 years |
|
More than 10 years |
|
Total |
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|
|
|
|
|
|
|
|
| Corporate debt |
46,229 |
|
|
64,260 |
|
|
47,047 |
|
|
12 |
|
|
157,548 |
|
| Non-US sovereign debt |
— |
|
|
5,280 |
|
|
861 |
|
|
6,764 |
|
|
12,905 |
|
| US sovereign debt |
— |
|
|
898 |
|
|
1,712 |
|
|
1,263 |
|
|
3,873 |
|
| Total available-for-sale securities, at fair value |
$ |
46,229
|
|
|
$ |
70,438
|
|
|
$ |
49,620
|
|
|
$ |
8,039
|
|
|
$ |
174,326
|
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|
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|
March 31, 2022 |
|
Remaining contractual maturity of the agreements |
|
Up to 1 year |
|
1-5 years |
|
5-10 years |
|
More than 10 years |
|
Total |
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|
|
|
|
|
|
| Corporate debt |
69,364 |
|
|
50,155 |
|
|
26,284 |
|
|
34 |
|
|
145,837 |
|
| Non-US sovereign debt |
1,692 |
|
|
864 |
|
|
1,086 |
|
|
9,355 |
|
|
12,997 |
|
| US sovereign debt |
— |
|
|
— |
|
|
— |
|
|
2,530 |
|
|
2,530 |
|
| Total available-for-sale securities, at fair value |
$ |
71,056
|
|
|
$ |
51,019
|
|
|
$ |
27,370
|
|
|
$ |
11,919
|
|
|
$ |
161,364
|
|
As of December 31, 2022, the Company held debt securities of two issuers each of which individually exceeded 10% of the Company’s total trading securities - Kazakhstan Sustainability Fund JSC (Fitch: BBB credit rating) in the amount of $727,340 and the Ministry of Finance of the Republic of Kazakhstan (S&P Global: BBB- credit rating) in the amount of $723,750. As of March 31, 2022, the Company held debt securities of two issuers each of which individually exceeded 10% of the Company’s total trading securities - the Ministry of Finance of the Republic of Kazakhstan and the Kazakhstan Sustainability Fund JSC in the amounts of $357,343 and $506,472, respectively.
The Company recognized no other-than-temporary impairment in accumulated other comprehensive loss.
The fair value of securities is determined using observable market data based on recent trading activity. Where observable market data is unavailable due to a lack of trading activity, the Company utilizes internally developed models to estimate fair value and independent third parties to validate assumptions, when appropriate. Estimating fair value requires significant management judgment, including benchmarking to similar instruments with observable market data and applying appropriate discounts that reflect differences between the securities that the Company is valuing and the selected benchmark. Depending on the type of securities owned by the Company, other valuation methodologies may be required.
Measurement of fair value is classified within a hierarchy based upon the transparency of inputs used in the valuation of an asset or liability. Classification within the hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
The valuation hierarchy contains three levels:
•Level 1 - Valuation inputs are unadjusted quoted market prices for identical assets or liabilities in active markets.
•Level 2 - Valuation inputs are quoted market prices for identical assets or liabilities in markets that are not active, quoted market prices for similar assets and liabilities in active markets, and other observable inputs directly or indirectly related to the asset or liability being measured.
•Level 3 - Valuation inputs are unobservable and significant to the fair value measurement.
The following tables present securities assets in the Сondensed Сonsolidated Balance Sheets or disclosed in the Notes to the condensed consolidated financial statements at fair value on a recurring basis as of December 31, 2022, and March 31, 2022:
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|
Weighted Average
Interest Rate |
|
Total |
|
Fair Value Measurements as of December 31, 2022 using |
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|
|
Quoted Prices in
Active Markets
for Identical Assets |
|
Significant
Other Observable
Inputs |
|
Significant Unobservable
Units |
|
|
|
(Level 1) |
|
(Level 2) |
|
(Level 3) |
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|
|
|
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|
|
|
|
| Corporate debt |
13.99 |
% |
|
$ |
1,097,488 |
|
|
$ |
1,001,417 |
|
|
$ |
95,800 |
|
|
$ |
271 |
|
| Non-U.S. sovereign debt |
12.26 |
% |
|
734,068 |
|
|
577,828 |
|
|
156,213 |
|
|
27 |
|
| Corporate equity |
— |
% |
|
62,351 |
|
|
60,127 |
|
|
1,895 |
|
|
329 |
|
| U.S. sovereign debt |
4.30 |
% |
|
34,012 |
|
|
34,012 |
|
|
— |
|
|
— |
|
| Exchange traded notes |
— |
% |
|
1,921 |
|
|
1,223 |
|
|
698 |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
| Total trading securities |
|
|
$ |
1,929,840
|
|
|
$ |
1,674,607
|
|
|
$ |
254,606
|
|
|
$ |
627
|
|
|
|
|
|
|
|
|
|
|
|
| Corporate debt |
14.88 |
% |
|
$ |
157,548 |
|
|
$ |
134,427 |
|
|
$ |
23,121 |
|
|
$ |
— |
|
| Non-US sovereign debt |
8.99 |
% |
|
12,905 |
|
|
5,894 |
|
|
7,011 |
|
|
— |
|
| US sovereign debt |
4.20 |
% |
|
3,873 |
|
|
3,873 |
|
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
| Total available-for-sale securities, at fair value |
|
|
$ |
174,326
|
|
|
$ |
144,194
|
|
|
$ |
30,132
|
|
|
$ |
—
|
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|
Weighted Average
Interest Rate
|
|
Total |
|
Fair Value Measurements as of March 31, 2022 (Recasted) using |
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|
|
Quoted Prices in Active Markets for Identical Assets |
|
Significant Other Observable Inputs |
|
Significant Unobservable Inputs |
|
|
|
(Level 1) |
|
(Level 2) |
|
(Level 3) |
|
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|
|
|
|
|
|
|
| Corporate debt |
9.09 |
% |
|
$ |
712,134 |
|
|
$ |
711,539 |
|
|
$ |
— |
|
|
$ |
595 |
|
| Non-U.S. sovereign debt |
13.15 |
% |
|
360,570 |
|
|
352,274 |
|
|
— |
|
|
8,296 |
|
| Corporate equity |
— |
|
|
72,354 |
|
|
71,827 |
|
|
276 |
|
|
251 |
|
| U.S. sovereign debt |
2.35 |
% |
|
10,435 |
|
|
10,435 |
|
|
— |
|
|
— |
|
| Exchange traded notes |
— |
|
|
2,884 |
|
|
2,884 |
|
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
| Total trading securities |
|
|
$ |
1,158,377
|
|
|
$ |
1,148,959
|
|
|
$ |
276
|
|
|
$ |
9,142
|
|
|
|
|
|
|
|
|
|
|
|
| Corporate debt |
11.09 |
% |
|
$ |
145,837 |
|
|
$ |
145,837 |
|
|
$ |
— |
|
|
$ |
— |
|
| Non-U.S. sovereign debt |
5.51 |
% |
|
12,997 |
|
|
12,997 |
|
|
— |
|
|
— |
|
| U.S. sovereign debt |
2.17 |
% |
|
2,530 |
|
|
2,530 |
|
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
| Total available-for-sale securities, at fair value |
|
|
$ |
161,364
|
|
|
$ |
161,364
|
|
|
$ |
—
|
|
|
$ |
—
|
|
The tables below present the valuation techniques and significant level 3 inputs used in the valuation as of December 31, 2022, and March 31, 2022. The tables are not intended to be all inclusive, but instead capture the significant unobservable inputs relevant to determination of fair value.
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| Type |
|
Valuation Technique |
|
FV as of December 31, 2022 |
|
Significant Unobservable Inputs |
|
% |
|
|
|
|
|
|
|
|
|
| Non-US sovereign debt |
|
DCF |
|
$ |
27 |
|
|
Discount rate |
|
48.8% |
|
|
|
|
|
|
Estimated number of years |
|
11 years |
| Corporate debt |
|
DCF |
|
271 |
|
|
Discount rate |
|
74.0% |
|
|
|
|
|
|
Estimated number of years |
|
3 months |
| Corporate equity |
|
DCF |
|
329 |
|
|
Discount rate |
|
58.8% |
|
|
|
|
|
|
Estimated number of years |
|
9 years |
| Total |
|
|
|
$ |
627
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
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| Type |
|
Valuation Technique |
|
FV as of March 31, 2022 |
|
Significant Unobservable Inputs |
|
% |
|
|
|
|
|
|
|
|
|
| Non-US sovereign debt |
|
DCF |
|
$ |
7,524 |
|
|
Discount rate |
|
69.0% |
|
|
|
|
|
|
Estimated number of years |
|
11 years |
| Non-US sovereign debt |
|
DCF |
|
772 |
|
|
Discount rate |
|
13.9% |
|
|
|
|
|
|
Estimated number of years |
|
1 year |
| Corporate debt |
|
DCF |
|
595 |
|
|
Discount rate |
|
45.0% |
|
|
|
|
|
|
Estimated number of years |
|
3 months |
| Corporate equity |
|
DCF |
|
251 |
|
|
Discount rate |
|
20.0% |
|
|
|
|
|
|
Estimated number of years |
|
9 years |
| Total |
|
|
|
$ |
9,142
|
|
|
|
|
|
The following table provides a reconciliation of the beginning and ending balances for investments that use Level 3 inputs for the nine months ended December 31, 2022, and the year ended March 31, 2022:
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|
|
|
|
|
|
|
|
Trading securities |
Balance as of March 31, 2022 (Recasted) |
|
$ |
9,142
|
|
| Purchase of investments that use Level 3 inputs |
|
1,980 |
|
| Reclassification to level 2 |
|
(1,842) |
|
| Reclassification of securities from Freedom UA to restricted accounts |
|
(2,384) |
|
| Sale |
|
(5,089) |
|
| Revaluation of investments that use Level 3 inputs |
|
(622) |
|
| Translation difference |
|
(558) |
|
Balance as of December 31, 2022 |
|
$ |
627
|
|
|
|
|
Balance as of March 31, 2021 (Recasted) |
|
$ |
19,032
|
|
| Reclassification to level 3 |
|
682 |
|
| Reclassification to level 1 |
|
(18,370) |
|
| Purchase of investments that use Level 3 inputs |
|
10,812 |
|
| Revaluation of investments that use Level 3 inputs |
|
(3,014) |
|
Balance as of March 31, 2022 (Recasted) |
|
$ |
9,142
|
|
The table below presents the amortized cost, unrealized gains and losses accumulated in other comprehensive income, and fair value of available-for-sale securities as of December 31, 2022, and March 31, 2022:
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|
December 31, 2022 |
|
|
|
|
Assets measured at amortized cost |
|
Recognized impairment loss in Income Statement |
|
Unrealized gain/(loss) accumulated in other comprehensive
income/(loss) |
|
Assets
measured at
fair value |
|
Maturity Date |
|
|
|
|
|
|
|
|
|
|
|
| Corporate debt |
|
$ |
154,689 |
|
|
$ |
(402) |
|
|
$ |
2,883 |
|
|
$ |
157,548 |
|
|
2023 - 2042 |
| Non-US sovereign debt |
|
14,482 |
|
|
— |
|
|
(1,577) |
|
|
12,905 |
|
|
2024 - indefinite |
| U.S. sovereign debt |
|
4,574 |
|
|
— |
|
|
(701) |
|
|
3,873 |
|
|
2024 - 2044 |
| Total available-for-sale securities, at fair value |
|
$ |
173,745
|
|
|
$ |
(402) |
|
|
$ |
605
|
|
|
$ |
174,326
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2022 (Recasted) |
|
|
|
|
Assets measured at amortized cost |
|
Unrealized loss accumulated in other comprehensive
income/(loss) |
|
Assets
measured at
fair value |
|
Maturity Date |
|
|
|
|
|
|
|
| Corporate debt |
|
$ |
146,112 |
|
|
$ |
(275) |
|
|
$ |
145,837 |
|
|
2022 - 2035 |
| Non-U.S. sovereign debt |
|
13,784 |
|
|
(787) |
|
|
12,997 |
|
|
2022 - indefinite |
| U.S. sovereign debt |
|
2,912 |
|
|
(382) |
|
|
2,530 |
|
|
2044 |
| Total available-for-sale securities, at fair value |
|
$ |
162,808
|
|
|
$ |
(1,444) |
|
|
$ |
161,364
|
|
|
|
|