Bank of Montreal 2012 Annual Report Download - page 166

Notes
(a) A continuity of our actuarial (gains) losses is as follows:
(Canadian $ in millions) Pension benefit plans Other employee future benefit plans
2012 2011 2012 2011
Unrecognized actuarial (gain) loss at beginning of year 160 –(68) –
(Gain) loss on the benefit liability arising from changes in assumptions 693 73 154 (66)
Shortfall (excess) of actual returns over expected returns on plan assets (177) 87 (4) (1)
Recognition in expense of a portion of the unrecognized actuarial loss (1) –(1) –
Impact of foreign exchange and other ––2(1)
Unrecognized actuarial (gain) loss at end of year 675 160 83 (68)
(b) A continuity of the unrecognized cost (benefit) of plan amendments is as follows:
(Canadian $ in millions) Pension benefit plans Other employee future benefit plans
2012 2011 2012 2011
Unrecognized (benefit) of plan amendments at beginning of year ––(7) (10)
Cost of plan amendments initiated during the year –25 ––
Recognition in expense of a portion of the unrecognized cost (benefit) of plan
amendments –(25) 33
Impact of foreign exchange and other ––––
Unrecognized (benefit) of plan amendments at end of year ––(4) (7)
Sensitivity of Assumptions
Key weighted-average economic assumptions used in measuring the
pension benefit liability, the other employee future benefit liability and
related expenses are outlined in the adjacent table. The sensitivity analysis
provided in the table should be used with caution as it is hypothetical and
the impact of changes in each key assumption may not be linear. The
sensitivities to changes in each key variable have been calculated
independently of the impact of changes in other key variables. Actual
experience may result in simultaneous changes in a number of key
assumptions. Changes in one factor may result in changes in another,
which would amplify or reduce certain sensitivities.
Pension
Other employee
future benefits
(Canadian $ in millions, except as noted)
Benefit
liability
Benefit
expense
Benefit
liability
Benefit
expense
Discount rate (%) 4.2 5.1 4.4 5.6
Impact of: 1% increase ($) (795) (23) (163) (3)
1% decrease ($) 997 28 209 4
Rate of compensation increase (%) 2.9 3.3 3.2 3.2
Impact of: 0.25% increase ($) 44 6 2 –
0.25% decrease ($) (42) (6) (1) –
Expected rate of return on assets (%) na 5.9 na 7.0
Impact of: 1% increase ($) na (53) na (1)
1% decrease ($) na 53 na 1
Assumed overall health care cost
trend rate (%) na na 5.4 (1) 5.4 (1)
Impact of: 1% increase ($) na na 172 12
1% decrease ($) na na (137) (9)
(1) Trending to 4.5% in 2030 and remaining at that level thereafter
na – not applicable
Cash Flows
Cash payments we made during the year in connection with our employee future benefit plans are as follows:
(Canadian $ in millions) Pension benefit plans
Other employee
future benefit plans
2012 2011 2012 2011
Contributions to defined benefit plans 198 150 ––
Contributions to defined contribution plans 77––
Benefits paid directly to pensioners 25 21 29 30
Total 230 178 29 30
Our best estimate of the amounts we expect to contribute for the year ended October 31, 2013 is approximately $158 million to our pension benefit plans and $41 million to our other employee future
benefit plans.
BMO Financial Group 195th Annual Report 2012 163