Management of Financial Risk

12 Months Ended

Jan. 31, 2022

Management of Financial Risks

24. Management of Financial Risk 

The Company’s financial instruments are exposed to certain risks as summarized below: 

(a) Credit risk 

Credit risk is the risk of loss if a customer or third party to a financial instrument fails to meet its contractual obligations. The Company’s cash is held through reputable financial institutions in Canada, U.S. and Australia. The carrying amount of cash represent the maximum exposure to credit risk. As at January 31, 2022, this amounted to $173,513. 

(b) Interest rate risk 

Interest rate risk is the risk that fair values or cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is not exposed to significant interest rate risk. 

(c) Liquidity risk 

Liquidity risk is the risk that the Company will not be able to meet is financial obligations as they come due. The Company manages liquidity risk through the management of its capital structure (Note 25). Accounts payable and accrued liabilities, due to related parties and other liabilities are due within the current operating period. 

The table below summarizes the maturity profile of the Company’s financial liabilities at January 31, 2022 based on contractual undiscounted payments:

	0 – 12 Months  $		Over 12 Months  $
Accounts payable and accrued liabilities		3,341,261		–
Due to related parties		144,867		–
Financial guarantee liability		218,780		864,515
Convertible debentures		237,880		–
Warrant liabilities		353		–
Loans payable		40,000		34,559

(d) Currency risk 

Currency risk is the risk of loss due to fluctuation of foreign exchange rates and the effects of these fluctuations on foreign currency denominated monetary assets and liabilities. A 5% change in exchange rates will increase or decrease the Company’s loss by approximately $89,800. The Company does not invest in derivatives to mitigate these risks.