Air Canada 2011 Annual Report Download - page 101

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2011 Consolidated Financial Statements and Notes
101
(d) Other CDN dollar secured financings are fixed rate financings that are secured by certain assets that amount to $225, of
which $154 relates to certain items of property and equipment and $71 relates to cash and cash equivalents (2010 –
$160 relates to certain items of property and equipment and $3 relates to cash and cash equivalents).
(e) Finance leases, related to facilities and aircraft, total $426 ($80 and US$340) ($493 ($82 and US$413) as at December 31,
2010). During 2011, the Corporation recorded interest expense on finance lease obligations of $46 (2010 – $54). The
carrying value of aircraft and facilities under finance leases amounted to $238 and $50 respectively (2010 – $317 and
$53).
Certain aircraft and other secured finance agreements contain collateral fair value tests. Under the tests the Corporation may
be required to provide additional collateral or prepay part of the financings. The maximum amount payable in 2012, assuming
the collateral is worth nil, is $513 (US$504). The maximum payable amount declines over time in relation to the outstanding
principal. For certain aircraft if the Corporation is required under the test to prepay obligations, these amounts are recoverable
from the third party residual value support providers upon expiry to the extent that the adjusted obligation taking into
account prepayments is less than the residual value support. Total collateral provided under the test for these aircraft as at
December 31, 2011 is $55 (US$54) (2010 – $53 (US$54)), in the form of cash deposits included in Deposits and other assets.
Cash interest paid on Long-term debt and finance leases in 2011 by the Corporation was $281 (2010 – $276).
Refer to Note 17 for the Corporation’s principal and interest repayment requirements as at December 31, 2011.