ACCOUNTING STANDARDS ISSUED BUT

NOT

YET EFFECTIVE

IFRS

16,

Leases

(“IFRS

16”

), was issued by the IASB in

January 2016.

This guidance brings most leases onto the balance sheet for lessees under a single model, eliminating the distinction between operating and finance leases. Lessor accounting remains largely unchanged and the distinction between operating and finance leases is retained. Furthermore, per the standard, a lessee recognizes a right-of-use asset and a lease liability. The right-of-use asset is treated similarly to other non-financial assets and depreciated accordingly, and the liability accrues interest. The lease liability is initially measured at the present value of the lease payments payable over the lease term, discounted at the rate implicit in the lease. IFRS

supersedes IAS

17,

Leases

(“IAS

17”

), and its related interpretations, and is effective for periods beginning on or after

January 1, 2019.

The standard is required to be adopted either retrospectively or using a modified retrospective approach.

Just Energy will adopt IFRS

beginning

April 1, 2019,

and has elected to apply the modified retrospective approach. On initial adoption, Just Energy will use the following practical expedients permitted by the standard, where applicable:

Exemption for short-term leases with a remaining term of

months or less as at

April 1, 2019

and low value leases, which will be accounted for as operating leases;

Using a single discount rate on a portfolio of leases with reasonably similar characteristics;

Excluding initial direct costs for the measurement of the right-of-use asset at the date of initial application;

Using historical information in determining the lease term where contracts contain options to extend or terminate the lease;

Adjusting the right-of-use asset amounts for any onerous contract provisions immediately before the date of initial application; and

Measuring the right-of-use assets at an amount equal to the lease liability, adjusted for any prepaid or accrued lease payments relating to that lease immediately before the date of initial application.

As at

April 1, 2019,

the financial statement impact of IFRS

is as follows:

Right-of-use assets of

$18.5

million have been recognized in relation to former operating leases and have been included in property and equipment caption on the interim unaudited condensed consolidated statements of financial position.

Additional lease liabilities of

$18.5

million have been recognized in relation to former operating leases and have been included in other current and non-current liabilities on the unaudited interim condensed consolidated statements of financial position, depending on the maturity of the lease.

IFRS Interpretations Committee (“IFRIC”)

23,

Uncertainty over Income Tax Treatments

(“IFRIC

23”

)

, provides guidance to be applied in the determination of taxable profit or loss, tax bases, unused tax losses, unused tax credits and tax rates, when there is uncertainty over income tax treatments under IAS

12,

Income Taxes

(“IAS

12”

). IFRIC

was issued by the IASB in

June 2017

and is effective for annual periods beginning on or after

January 1, 2019.

Just Energy does

not

expect the interpretation to have a material impact on the consolidated financial statements when it implements IFRIC

beginning

April 1, 2019.

IFRIC Agenda Paper

11,

Physical Settlement of Contracts to Buy or Sell a Non-Financial Item (“Agenda Paper

the IFRS Interpretations Committee (“IFRIC”) reached a decision on Agenda Paper

during its meeting on

March 5 -

2019.

The decision was in respect to a request about how an entity applies IFRS

to particular contracts to buy or sell a non-financial item at a fixed price.

The Company has reviewed the agenda decision and determined that a change is required in its accounting policy related to contracts to buy or sell a non-financial item that can be settled net in cash or another financial instrument, or by exchanging financial instruments. These are contracts the Company enters into which are accounted for as derivatives at fair value through profit or loss but physically settled by the underlying non-financial item. The IFRIC concluded that IFRS

neither permits or requires an entity to reverse the accumulated gain or loss previously recognized on the derivative and recognize a corresponding adjustment to cost of goods sold or inventory when the contract is physically settled.

In its

December 2018

meeting, the International Accounting Standards Board (IASB) confirmed its view that it expects companies to be entitled to sufficient time to implement changes in accounting policy that result from agenda decisions of the IFRIC. The Company is currently evaluating the impact of implementing the agenda decision on its financial statements, systems and processes. Given the nature of its current systems and processes and the volume of transactions affected, the Company determined it was

not

possible to affect the accounting change in time for its

March 31, 2019

reporting. The Company expects to implement the change retrospectively in fiscal

2020

year. While the impact has

not

been quantified, the Company expects there will be material movements between cost of sales and change in fair value of derivative instruments and other in Just Energy’s consolidated statement of operations and the value of gas in storage on the statement of financial position. There is

impact on the net income of the Company.