Page 128 - Suncor AR English

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Changes in the number of outstanding SARs were as follows:

2013
2012

Weighted Weighted
Average Average
Number Exercise Price Number Exercise Price
(thousands)
($)
(thousands)
($)

Outstanding, beginning of year
7 776
29.65
8 752
29.32
.......................................................................................................................................................................................................................................................
Granted 88 32.60 101 34.51
.......................................................................................................................................................................................................................................................
Exercised (1 567) 27.57 (482) 20.53
.......................................................................................................................................................................................................................................................
Forfeited/expired (492) 35.47 (595) 32.86

Outstanding, end of year 5 805 29.75 7 776 29.65

Exercisable, end of year
5 665
29.61
6 568
30.80

Share-Based Compensation Expense

The following table summarizes the share-based compensation expense recorded for all plans within Operating, Selling
and General expense.

($ millions) 2013 2012

Equity-settled plans 51 83
.......................................................................................................................................................................................................................................................
Cash-settled plans 341 269

Total share-based compensation expense 392 352

Liability Recognized for Share-Based Compensation

The company has recorded a liability of $653 million as at December 31, 2013 (December 31, 2012 – $523 million), of
which $318 million was classified as current (December 31, 2012 – $281 million), based on the fair value of awards

accounted for as cash-settled. The intrinsic value of the vested awards at December 31, 2013 was $347 million
(December 31, 2012 – $237 million).

27. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

The company’s financial instruments consist of cash and cash equivalents, accounts receivable, derivative contracts,
substantially all accounts payable and accrued liabilities, debt, and certain portions of other assets and other long-term

liabilities.

Non-Derivative Financial Instruments
The fair values of cash and cash equivalents, accounts receivable, short-term debt, and accounts payable and accrued

liabilities approximate their carrying values due to the short-term maturities of those instruments.

The company’s long-term debt and long-term financial liabilities are recorded at amortized cost using the effective interest
method. At December 31, 2013, the carrying value of fixed-term debt accounted for under amortized cost was

$9.6 billion (December 31, 2012 – $9.4 billion) and the fair value at December 31, 2013 was $11.2 billion (December 31,
2012 – $11.8 billion). The estimated fair value of long-term debt is based on pricing sourced from market data, which is

considered Level 2 fair value inputs.

Derivative Financial Instruments

(a) Non-Designated Derivative Financial Instruments
• Energy Trading Derivatives – The company’s Energy Trading group uses physical and financial energy derivative

contracts, including swaps, forwards and options to earn trading revenues.

124 SUNCOR ENERGY INC. ANNUAL REPORT 2013