Shaw 2013 Annual Report Download - page 113

S
haw
C
ommunications Inc
.
N
O
TE
S
T
OCO
N
SO
LIDATED FINAN
C
IAL
S
TATEMENT
S
August 31, 2013 and 201
2
[all amounts in millions of Canadian dollars exce
p
t share and
p
er share amounts
]
Defined benefit
p
ension
p
lan
s
The
C
om
p
an
y
has two non-re
gi
stered ret
i
rement
p
lans
f
or des
ig
nated execut
i
ves and sen
i
o
r
execut
i
ves and several reg
i
stered pens
i
on plans
f
or certa
i
n employees
i
n the med
i
a bus
i
ness.
The following is a summary of the accrued benefit liabilities recognized in the statement of
fi
nanc
i
al
p
os
i
t
i
on
.
2013
$
2012
$
Unre
gi
stered
p
lans
A
ccrued benefit obligation 40
6
378
Fair value of
p
lan asset
s
302 –
10
4
378
Re
gi
stered
p
lans
A
ccrued bene
fi
t obl
i
gat
i
o
n
152
1
4
9
Fair value of plan asset
s
133 116
19
33
Acc
r
ued be
n
efit
l
iabi
l
ities a
n
d deficit
123
411
The
p
lans ex
p
ose the
C
om
p
an
y
to a number o
f
r
i
sks, o
f
wh
i
ch the most s
ig
n
ifi
cant are as
fo
ll
o
w
s:
(
i) Volatilit
y
in market conditions: The accrued benefit obli
g
ations are calculated usin
g
di
scount rates w
i
th re
f
erence to bond
yi
elds closel
y
match
i
n
g
the term o
f
the est
i
mate
d
c
ash flows while many of the assets are invested in other types of assets. If plan asset
s
under
p
erform these
y
ields, this will result in a deficit. Chan
g
in
g
market conditions in
c
on
j
unct
i
on w
i
th d
i
scount rate volat
i
l
i
t
y
w
i
ll result
i
n volat
i
l
i
t
y
o
f
the accrued bene
fit
l
iabilities. To minimize some of the investment risk, the Company has established long-
term fundin
g
tar
g
ets where the time horizon and risk tolerance are s
p
ecified.
(ii) S
elect
i
on o
f
account
i
ng assumpt
i
ons: The calculat
i
on o
f
the accrued bene
fi
t obl
i
gat
i
on
s
i
nvolves projecting future cash flows of the plans over a long time frame. This means tha
t
assum
p
t
i
ons used can have a mater
i
al
i
m
p
act on the statements o
ffi
nanc
i
al
p
os
i
t
i
on an
d
c
omprehens
i
ve
i
ncome because
i
n pract
i
ce,
f
uture exper
i
ence o
f
the plans may not be
i
n
l
ine with the selected assumptions.
N
on-reg
i
stere
d
pens
i
on p
l
an
s
The
C
om
p
an
yp
rov
i
des a su
pp
lemental execut
i
ve ret
i
rement
p
lan
(“S
ERP”
)f
or certa
i
no
fi
ts
senior executives. Benefits under this plan are based on the employees’ length of service an
d
t
heir hi
g
hest three-
y
ear avera
g
e rate of eli
g
ible
p
ensionable earnin
g
s durin
g
their
y
ears o
f
serv
i
ce. In
2012
, the
C
om
p
an
y
closed the
p
lan to new
p
art
i
c
ip
ants and amended the
p
lan t
o
f
reeze base salary levels at August 31, 2012 for purposes of determining eligible pensionabl
e
earnin
g
s which resulted in a
g
ain of
$
25 in res
p
ect of
p
ast service ad
j
ustments. The
p
lan wa
s
also amended to
p
rov
i
de
f
und
i
n
g
o
f
u
p
to
90%
o
f
the accrued bene
fi
t obl
ig
at
i
on over a
p
er
i
od o
f
six years. Employees are not required to contribute to this plan. During 2013, the plan becam
e
p
artiall
y
funded as the Com
p
an
y
made contributions of
$
300 to a Retirement Com
p
ensatio
n
Arran
g
ement Trust
(“
R
C
A”
)
.
109