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100100 2014 Annual Report
BB. EXCEPTIONAL ITEMS
Exceptional items are those items that in
management’s view are required to be separately
disclosed by virtue of their size or incidence to enable
a full understanding of the Corporation’s financial
performance.
CC. SEGMENT REPORTING
Operating segments are reported in a manner
consistent with the internal reporting provided to the
chief operating decision maker. The chief operating
decision maker, who is responsible for allocating
resources and assessing performance of operations,
has been identified as the Chief Executive Officer.
Air Canada is managed as one operating segment
based on how financial information is produced
internally for the purposes of making operating
decisions.
DD. ACCOUNTING STANDARDS
ADOPTED EFFECTIVE JANUARY 1, 2014
The Corporation has adopted the amendments
to IAS 32 – Financial Instruments: Presentation
effective January 1, 2014. The IAS 32 amendments
address inconsistencies when applying the offsetting
requirements.
EE. ACCOUNTING STANDARDS
AND AMENDMENTS ISSUED BUT
NOT YET ADOPTED
The following is an overview of accounting standard
changes that the Corporation will be required to
adopt in future years. The Corporation continues
to evaluate the impact of these standards on its
consolidated financial statements.
IFRS 15 – Revenue from Contracts
with Customers
IFRS 15 replaces IAS 18 Revenue and related
interpretations. The core principle of the new standard
is to recognize revenue to depict the transfer of goods
or services to customers in amounts that reflect the
consideration to which the company expects to be
entitled in exchange for those goods or services. The
new standard is intended to enhance disclosures about
revenue, provide more comprehensive guidance for
transactions that were not previously addressed and
improve guidance for multiple-element arrangements.
IFRS 15 is effective for annual periods beginning on
January 1, 2017, with early adoption permitted.
IFRS 9 – Financial Instruments
IFRS 9 introduces new requirements for the
classification and measurement of financial assets.
IFRS 9 requires all recognized financial assets that
are within the scope of IAS 39 Financial Instruments:
Recognition and Measurement to be measured at
amortized cost or fair value in subsequent accounting
periods following initial recognition. Specifically,
financial assets that are held within a business model
whose objective is to collect the contractual cash
flows, and that have contractual cash flows that
are solely payments of principal and interest on the
principal outstanding are generally measured at
amortized cost at the end of subsequent accounting
periods. All other financial assets including equity
investments are measured at their fair values at the
end of subsequent accounting periods.
Requirements for classification and measurement of
financial liabilities were added in October 2010 and
they largely carried forward existing requirements
in IAS 39, Financial Instruments – Recognition and
Measurement, except that fair value changes due
to credit risk for liabilities designated at fair value
through profit and loss would generally be recorded in
other comprehensive income.
IFRS 9 was amended in November 2013, to (i) include
guidance on hedge accounting, and (ii) allow entities
to early adopt the requirement to recognize changes
in fair value attributable to changes in an entity’s own
credit risk, from financial liabilities designated under
the fair value option, in OCI, without having to adopt
the remainder of IFRS 9.
The final version of IFRS 9 was issued in July 2014 and
includes (i) a third measurement category for financial
assets – fair value through other comprehensive
income; (ii) a single, forward-looking expected loss
impairment model, and (iii) a mandatory effective
date for IFRS 9 of annual periods beginning on or after
January 1, 2018, with early adoption permitted.