Air Canada 2009 Annual Report Download - page 114

Download and view the complete annual report

Please find page 114 of the 2009 Air Canada annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 146

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146

2009 Air Canada Annual Report
114
Benefi t Obligation and Plan Assets
The following table presents fi nancial information related to the changes in the pension and other post-employment benefi ts plans:
Pension Benefi ts Other Employee Future Benefi ts
2009 2008 2009 2008
Change in benefi t obligation
Benefi t obligation at beginning of year $ 10,729 $ 12,150 $ 790 $ 899
Current service cost 123 203 50 62
Interest cost 760 706 54 52
Employees’ contributions 78 83 - -
Benefi ts paid (724) (677) (58) (57)
Plan amendments - 2 - -
Actuarial loss (gain) 1,015 (1,738) 33 (189)
Foreign exchange gain (loss) (44) - (18) 23
11,937 10,729 851 790
Change in plan assets
Fair value of plan assets at beginning of year 9,717 11,747 - -
Actual return (loss) on plan assets 1,296 (1,879) - -
Employer contributions 389 456 58 57
Employees’ contributions 78 83 - -
Pension MOUs share contribution 28 - - -
Benefi ts paid (724) (677) (58) (57)
Foreign exchange gain (loss) (33) (13) - -
10,751 9,717 - -
Defi cit at end of year 1,186 1,012 851 790
Unrecognized past service costs (2) (2) - -
Unrecognized net actuarial gain (loss) (1,079) (479) 258 321
Valuation allowance against accrued benefi t 15 9 - -
Net benefi t obligation $ 120 $ 540 $ 1,109 $ 1,111
Weighted average assumptions used to determine
the accrued benefi t liability
Discount rate 6.40 % 7.35 % 4.75 - 6.40 % 6.25 - 7.35 %
Rate of compensation increase (a) 2.50 % 2.50 %
(a) As a result of pay awards, a rate of compensation increase of 0% plus merit was used for years 2009 and 2010 in
determining the net benefi t obligation for the pension plan and 2.50% plus merit for the remaining years.
Under the terms of the domestic registered and supplementary plans, there is no indexation provided after January 1, 2007.
The pension benefi t defi cit of only those plans that are not fully funded at the end of the year is as follows:
2009 2008
Domestic registered plans $ 496 $ 383
US, UK, and Japan 78 83
Supplementary plans 653 606
$ 1,227 $ 1,072
The net defi cit, on an accounting basis, at December 31, 2009 for pension benefi ts was $1,186 (2008 - $1,012). The increase
in the accounting defi cit is mainly the result of the increase to the accrued benefi t obligation resulting from the decrease
in the discount rate largely offset by the higher than expected returns on plan assets.