Notes to the Consolidated Financial Statements
Dollar amounts are in thousands of Canadian dollars (except share and per share amounts)
25. Financial Risk Management Objectives and Policies (continued)
Fair Value Measurement
Financial instruments are defined as a contractual right or obligation to receive or deliver cash or another financial asset. The following 
table presents the classification, subsequent measurement, carrying values and fair values of the Company’s financial assets and liabilities:
December 31, 2013 December 31, 2012
Classification
subsequent 
measurement
carrying 
Value Fair Value
carrying 
Value Fair Value
Other Financial Liabilities:
mortgages (b) Amortized Cost $699,130 $748,806 $625,081 $687,119
Convertible debentures (a) Amortized Cost $96,419 $100,461 $98,042 $102,942
subordinated debentures (b) Amortized Cost $‑ $‑ $9,998 $10,104
Cash and cash equivalents are classified as held for trading and carried at their fair values. The Company’s short‑term financial instruments, 
comprising accounts receivable, restricted cash, accounts payable and accrued liabilities, security deposits, loans and construction loans are 
carried at amortized cost which, due to their short‑term nature, approximates their fair value.
(a) The fair value of the convertible debentures are based on a quoted market price as at the reporting date (level 1).
(b) The mortgages and subordinated debentures are based upon discounted future cash flows using discount rates that reflect current 
market conditions for instruments with similar terms and risks.  Such fair value estimates are not necessarily indicative of the amounts the 
Company might pay or receive in actual market transactions (level 2).
The interest rates used to discount the estimated cash flows, when applicable, are based on the 5‑year government yield curve at the 
reporting date, plus an adequate credit spread, and were as follows:
As at
December 31, 
2013
December 31, 
2012
Mortgages ‑ Apartments 2.60% 2.27%
Mortgages ‑ MHCs 4.45% 4.02%
As at December 31, 2013, the Company did not have any financial assets or liabilities measured at fair value on the Consolidated 
Statements of Financial Position.
26. Commitments
As at December 31, 2013, Killam has committed development costs of $16.6 million.
The Company is subject to various legal proceedings and claims that arise in the ordinary course of business. These matters are generally 
covered by insurance. Management believes that the final outcome of such matters will not have a material adverse effect on the financial 
position, results of operations or liquidity of the Company. However, actual outcomes may differ from Management’s expectations.
27. Financial Guarantees
Killam Properties Inc. is the guarantor for borrowings held through its three equity investments.  As at December 31, 2013, the maximum 
potential obligation resulting from these guarantees is $70.5 million, all related to long‑term mortgage financing (December 31, 2012 – 
$72.3 million). These loans are secured by a first ranking mortgage over the associated investment property. Management has reviewed 
the contingent liability associated with its financial guarantee contracts and, at December 31, 2013, determined that a provision is not 
required to be recognized in the Statement of Financial Position. (December 31, 2012  ‑ $nil).
94 Killam ProPerties inc | 2013