Air Canada 2014 Annual Report Download - page 108

Download and view the complete annual report

Please find page 108 of the 2014 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 140

  • 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

108 2014 Annual Report
Under the agreement with the Government of
Canada, in respect of the plan years during which
Air Canada funds its plan pursuant to the 2014
Regulations, Air Canada is subject to a series of
covenants and undertakings, including a prohibition
on dividends and share repurchases, as well as
certain limitations on executive compensation
arrangements. As requested by the Government of
Canada, Air Canada has also agreed to use reasonable
efforts, during the negotiations of the next collective
agreements with Air Canada’s Canadian-based unions,
to seek to include in those collective agreements
provisions which would have employees contribute
fifty per cent of their pension plan normal costs, and
has agreed not to implement pension plan benefit
improvements without regulatory approval.
Giving effect to the Air Canada 2014 Pension
Regulations as outlined above, total employer pension
funding contributions during 2014 amounted to $445.
In the event that Air Canada does not opt out and
continues funding its domestic registered pension
plans under the 2014 Regulations, total employer
contributions to defined benefit pension plans for
2015 are expected to be $424.
BENEFIT OBLIGATION AND PLAN ASSETS
These consolidated financial statements include all of the assets and liabilities of all Corporation-sponsored
plans. The net benefit obligation is recorded in the statement of financial position as follows:
2014 2013
ACCRUED BENEFIT LIABILITIES FOR
Pension benefits obligation $ 1,183 $ 1,578
Other employee future benefits 1,285 1,183
NET BENEFIT OBLIGATION 2,468 2,761
Current portion (65) (74)
PENSION AND OTHER BENEFIT LIABILITIES $ 2,403 $ 2,687
The current portion of the net benefit obligation represents an estimate of other employee future benefits
claims to be paid during 2015. The current portion is included in Accounts payable and accrued liabilities.
In 2012, the Corporation concluded an agreement with Aimia Canada Inc. (formerly Aeroplan) through which
the Corporation would transfer to the Aeroplan defined pension plan all the pension plan assets and obligations
related to pension benefits accrued by certain Air Canada employees who chose to transition to employment
at Aeroplan in 2009. The Corporation continued to retain plan assets and report plan liabilities for services
accrued for the transferred Aeroplan employees’ pension until such transfer was approved by OSFI. Approval
was received and the transfer completed in 2014. A settlement gain of $2 was recorded.