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FAIR VALUE CHANGES
 6 Months Ended
Jun. 30, 2021
Fair Value Measurement [Abstract]  
Fair value changes RISK MANAGEMENT AND FINANCIAL INSTRUMENTS
a)    Risk Management
The company’s activities expose it to a variety of financial risks, including market risk (i.e., commodity price risk, interest rate risk, and foreign currency risk), credit risk and liquidity risk. We use financial instruments primarily to manage these risks.
There have been no other material changes to the company’s financial risk exposure or risk management activities since December 31, 2020. Please refer to Note 26 of the December 31, 2020 audited consolidated financial statements for a detailed description of the company’s financial risk exposure and risk management activities.
b)    Financial Instruments
The following table lists the company’s financial instruments by their respective classification as at June 30, 2021 and December 31, 2020:
20212020
AS AT JUN. 30, 2021 AND DEC. 31, 2020 (MILLIONS)Carrying
Value		Fair
Value		Carrying
Value		Fair
Value
Financial assets
Cash and cash equivalents$10,459 $10,459 $9,933 $9,933 
Other financial assets
Government bonds2,308 2,308 2,651 2,651 
Corporate bonds3,179 3,179 3,599 3,599 
Fixed income securities and other2,527 2,527 2,270 2,270 
Common shares and warrants8,442 8,442 6,514 6,514 
Loans and notes receivable2,560 2,560 2,696 2,696 
19,016 19,016 17,730 17,730 
Accounts receivable and other13,793 13,793 13,672 13,672 
$43,268 $43,268 $41,335 $41,335 
Financial liabilities
Corporate borrowings$9,145 $10,180 $9,077 $10,540 
Non-recourse borrowings of managed entities
Property-specific borrowings134,215 136,488 128,556 131,099 
Subsidiary borrowings8,911 9,292 10,768 11,085 
143,126 145,780 139,324 142,184 
Accounts payable and other42,235 42,235 41,117 41,117 
Subsidiary equity obligations3,478 3,478 3,699 3,699 
$197,984 $201,673 $193,217 $197,540 
c)    Fair Value Hierarchy Levels
The following table categorizes financial assets and liabilities, which are carried at fair value, based upon the fair value hierarchy levels:
 20212020
AS AT JUN. 30, 2021 AND DEC. 31, 2020 (MILLIONS)
Level 1
Level 2
Level 3
Level 1Level 2Level 3
Financial assets
Other financial assets
Government bonds$175 $2,133 $— $7 $2,644 $— 
Corporate bonds516 2,042 402 192 2,764 286 
Fixed income securities and other753 1,212 562 867 912 491 
Common shares and warrants6,516 742 1,184 4,548 577 1,389 
Loans and notes receivables— — 20 — 42 68 
Accounts receivable and other49 1,803 89 50 1,581 135 
$8,009 $7,932 $2,257 $5,664 $8,520 $2,369 
Financial liabilities
Accounts payable and other$179 $5,076 $689 $75 $5,090 $724 
Subsidiary equity obligations— 86 1,383 — 77 1,380 
$179 $5,162 $2,072 $75 $5,167 $2,104 
During the three and six months ended June 30, 2021, there were no transfers between Level 1, 2 or 3.
Fair values of financial instruments are determined by reference to quoted bid or ask prices, as appropriate. If bid and ask prices are unavailable, the closing price of the most recent transaction of that instrument is used. In the absence of an active market, fair values are determined based on prevailing market rates for instruments with similar characteristics and risk profiles or internal or external valuation models, such as option pricing models and discounted cash flow analysis, using observable market inputs.
The following table summarizes the valuation techniques and key inputs used in the fair value measurement of Level 2 financial instruments:
(MILLIONS)
Type of Asset/Liability
Carrying Value Jun. 30, 2021Valuation Techniques and Key Inputs
Derivative assets/Derivative liabilities (accounts receivable/accounts payable)
$ 1,803 /
(5,076)
Foreign currency forward contracts – discounted cash flow model – forward exchange rates (from observable forward exchange rates at the end of the reporting period) and discounted at credit adjusted rate
 
Interest rate contracts – discounted cash flow model – forward interest rates (from observable yield curves) and applicable credit spreads discounted at a credit adjusted rate
 
Energy derivatives – quoted market prices, or in their absence internal valuation models, corroborated with observable market data
Other financial assets6,129 Valuation models based on observable market data
Redeemable fund units (subsidiary equity obligations)(86)Aggregated market prices of underlying investments
Fair values determined using valuation models requiring the use of unobservable inputs (Level 3 financial assets and liabilities) include assumptions concerning the amount and timing of estimated future cash flows and discount rates. In determining those unobservable inputs, the company uses observable external market inputs such as interest rate yield curves, currency rates and price and rate volatilities, as applicable, to develop assumptions regarding those unobservable inputs.
The following table summarizes the valuation techniques and significant unobservable inputs used in the fair value measurement of Level 3 financial instruments:
(MILLIONS)
Type of Asset/Liability
Carrying Value Jun. 30, 2021Valuation
Techniques		Significant
Unobservable Inputs		Relationship of Unobservable
Inputs to Fair Value
Fixed income securities and other$562 Discounted cash flows•  Future cash flows
•  Increases (decreases) in future cash flows increase (decrease) fair value
•  Discount rate
•  Increases (decreases) in discount rate decrease (increase) fair value
Corporate bonds402 Discounted cash flows•  Future cash flows
•  Increases (decreases) in future cash flows increase (decrease) fair value
•  Discount rate
•  Increases (decreases) in discount rate decrease (increase) fair value
Common shares and warrants1,184 Discounted cash flows•  Future cash flows
•  Increases (decreases) in future cash flows increase (decrease) fair value
•  Discount rate
•  Increases (decreases) in discount rate decrease (increase) fair value
Black-Scholes model•  Volatility






•  Increases (decreases) in volatility increase (decreases) fair value
•  Term to maturity
•  Increases (decreases) in term to maturity increase (decrease) fair value
Limited-life funds (subsidiary equity obligations)(1,383)Discounted cash flows•  Future cash flows•  Increases (decreases) in future cash flows increase (decrease) fair value
•  Discount rate•  Increases (decreases) in discount rate decrease (increase) fair value
•  Terminal capitalization rate•  Increases (decreases) in terminal capitalization rate decrease (increase) fair value
•  Investment horizon•  Increases (decreases) in the investment horizon decrease (increase) fair value
Derivative assets/Derivative liabilities (accounts receivable/payable)
89 /
(689)
  Discounted cash flows  •  Future cash flows
  •  Increases (decreases) in future cash flows increase (decrease) fair value
•  Discount rate•  Increases (decreases) in discount rate decrease (increase) fair value
The following table presents the changes in the balance of financial assets and liabilities classified as Level 3 for the periods ended June 30, 2021:
 Three Months EndedSix Months Ended
AS AT AND FOR THE PERIODS ENDED JUN. 30, 2021 (MILLIONS) Financial
Assets		Financial
Liabilities		Financial
Assets		Financial
Liabilities
Balance, beginning of period$2,390 $1,994 $2,369 $2,104 
Fair value changes in net income77 32 114 2 
Fair value changes in other comprehensive income1
76 46 (13)19 
Additions, net of disposals(286)— (213)(53)
Balance, end of period$2,257 $2,072 $2,257 $2,072 
1.Includes foreign currency translation.
FAIR VALUE CHANGES
Fair value changes recorded in net income represent gains or losses arising from changes in the fair value of assets and liabilities, including derivative financial instruments, accounted for using the fair value method and are comprised of the following:
FOR THE PERIODS ENDED JUN. 30 (MILLIONS) Three Months EndedSix Months Ended
2021202020212020
Investment properties$880 $(797)$1,707 $(679)
Transaction related expenses, net of gains(282)224 999 — 
Financial contracts138 (64)653 94 
Impairment and provisions(149)(325)(384)(550)
Other fair value changes(210)(191)(504)(432)
$377 $(1,153)$2,471 $(1,567)