Carnival Cruises 2007 Annual Report Download - page 29

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
26 | CARNIVAL CORPORATION & PLC
During the year ended November 30, 2007, RSA and RSU activity was as follows:
Restricted Stock Awards Restricted Stock Units
Weighted- Weighted-
Average Average
Grant Date Grant Date
Shares Fair Value Shares Fair Value
Outstanding at November 30, 2006 ............................................ 890,711 $40.20 378,848 $51.88
Granted .................................................................. 232,846 $49.98 443,747 $49.89
Vested ................................................................... (205,250) $28.09 (65,344) $47.24
Forfeited ................................................................. (19,812) $51.63
Outstanding at November 30, 2007 ............................................ 918,307 $45.39 737,439 $51.10
The total grant date fair value of RSAs and RSUs vested
during fiscal 2007, 2006 and 2005 was $9 million, $9 million
and $8 million, respectively. As of November 30, 2007, there
was $26 million of total unrecognized compensation cost
related to RSAs and RSUs. This cost is expected to be recog-
nized over a weighted-average period of 1.6 years.
Defined Benefit Pension Plans
We have several defined benefit pension plans, which
cover some of our shipboard and shoreside employees. The
U.S. and UK shoreside employee plans are closed to new
membership and are funded at or above the level required by
U.S. or UK regulations. The remaining defined benefit plans
are primarily unfunded. In determining all of our plans’ benefit
obligations at November 30, 2007, we assumed a weighted-
average discount rate of 5.84%. The net assets or liabilities
related to the obligations under these single employer defined
benefit pension plans are not material.
In addition, P&O Cruises, Princess and Cunard participate
in an industry-wide British Merchant Navy Officers Pension
Fund (“MNOPF”), a defined benefit multiemployer pension
plan available to certain of their British shipboard officers. The
MNOPF is divided into two sections, the “New Section” and
the “Old Section,” each of which covers a different group of
participants, with the Old Section closed to further benefit
accrual and the New Section only closed to new membership.
At November 30, 2007, the New Section was estimated to
have a funding deficit before taking into account future install-
ments of deficit contributions due from participating employers
and the Old Section was estimated to have a funding surplus.
Substantially all of any MNOPF New Section deficit liability
which we may have relates to the obligations of P&O Cruises
and Princess, which existed prior to the combination in 2003
of Carnival Corporation’s and Carnival plc’s businesses into a
DLC. However, since the MNOPF is a multiemployer plan and
it was not probable that we would withdraw from the plan
nor was our share of the liability certain, we could not record
our estimated share of the ultimate deficit as a Carnival plc
acquisition liability that existed at the DLC transaction date.
The amount of our share of the fund’s ultimate deficit could
vary considerably if different pension assumptions and/or
estimates were used. Therefore, we expense our portion of
any deficit as amounts are invoiced by, and become due and
payable to, the fund’s trustee. In 2007 and 2005, we received
special assessment invoices from the fund for what the trustee
calculated to be our additional share of the entire MNOPF
liability, based on their most recent actuarial valuations.
Accordingly, we recorded the full invoiced liability of $20 million
and $23 million in payroll and related expense in 2007 and
2005, respectively. It is still possible that the fund’s trustee
may invoice us for additional amounts in the future for various
reasons, including if they believe the fund requires further
contributions.
Total expense for all defined benefit pension plans, includ-
ing multiemployer plans, was $55 million, $28 million and
$45 million in fiscal 2007, 2006 and 2005, respectively.
On November 30, 2007, we adopted SFAS No. 158,
“Employers’ Accounting for Defined Benefit Pension and
Other Postretirement Plans—an amendment to FASB State-
ments No. 87, 88, 106 and 132(R)” (“SFAS No. 158”). SFAS