FINANCIAL INSTRUMENTS

9 Months Ended

Dec. 31, 2019

14. FINANCIAL INSTRUMENTS

The FASB ASC topic 820 on fair value measurement and disclosures establishes three levels of inputs that may be used to measure fair value: quoted prices in active markets for identical assets or liabilities (referred to as Level 1), observable inputs other than Level 1 that are observable for the asset or liability either directly or indirectly (referred to as Level 2), and unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities (referred to as Level 3).

The carrying values and fair values of our financial instruments are as follows:


		December 31, 2019				March 31, 2019
		Carrying		Fair		Carrying		Fair
	Level	Value		Value		value		Value
Cash	1	$	101,549	$	101,549	$	66,539	$	66,539
Accounts receivable	2	$	363,557	$	363,557	$	233,908	$	233,908
Long Term investment and advance - GlamSmile Dental Technology Asia	3	$	2,278,150	$	2,278,150	$	2,306,817	$	2,306,817
Long term investments and advances Condor	1	$	1,175,176	$	1,175,176	$	1,335,680	$	1,335,680
Investment in Metrics in Balance	2	$	3,459,431	$	3,459,431		3,472,011	$	3,472,011
Deferred revenue	2	$	112,767	$	112,767	$	63,852	$	63,852
Accounts payable	2	$	2,136,553	$	2,136,553	$	1,919,095	$	1,919,095
Accrued liabilities	2	$	455,168	$	455,168	$	450,347	$	450,347

The following method was used to estimate the fair values of our financial instruments:

The carrying amount of level 1 and level 2 financial instruments approximates fair value because of the short maturity of the instruments.

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies, or similar techniques, and at least one significant model assumption or input is unobservable. Level 3 financial assets also include certain investment securities for which there is limited market activity such that the determination of fair value requires significant judgment or estimation.

The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the ability to observe valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. The Company’s policy is to recognize transfers into and out of levels within the fair value hierarchy at the end of the fiscal quarter in which the actual event or change in circumstances that caused the transfer occurs. There were no significant transfers between Level 1, Level 2, or Level 3 during the nine month period ended December 31, 2019. When a determination is made to classify an asset or liability within Level 3, the determination is based upon the significance of the unobservable inputs to the overall fair value measurement. The following table provides a reconciliation of the beginning and ending balances of the item measured at fair value on a recurring basis in the table above that used significant unobservable inputs (Level 3):


	Nine month period ended		Nine month period ended
	December 31,		December 31,
	2019		2018
Long term investments and advances:
Beginning balance	$	2,306,817	$	2,245,137
Gains (losses) included in net loss		(28,667)		58,427
Transfers in (out of level 3)		—		—
Ending balance	$	2,278,150	$	2,308,564

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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