Annual Report 2008-2009 - Emirates.com
Annual Report 2008-2009 - Emirates.com
Annual Report 2008-2009 - Emirates.com
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<strong>Emirates</strong><br />
098<br />
23. Lease liabilities (continued)<br />
The fair value of lease liabilities amounts to AED 6,977.9 million (<strong>2008</strong>: AED 6,061.4 million). The fair value is determined by<br />
discounting projected cash flows using the interest rate yield curve for the remaining term to maturities and currencies adjusted for<br />
credit spread.<br />
<strong>2009</strong> <strong>2008</strong><br />
AED'000 AED'000<br />
Operating leases<br />
Future minimum lease payments are as follows:<br />
Aircraft fleet 28,107,555 25,880,651<br />
Other 2,748,955 2,504,453<br />
Within one year<br />
3,885,544<br />
Between 2 and 5 years<br />
14,273,279<br />
After 5 years 12,697,687<br />
<strong>Emirates</strong> is entitled to extend certain aircraft leases for a further period of one to four years at the end of the initial lease period.<br />
Further, <strong>Emirates</strong> is entitled to purchase eighteen of ninety four (<strong>2008</strong>: eighteen of eighty five) aircraft under these leases.<br />
Employee end of service benefits<br />
Frequent flyer programme<br />
Employee end of service benefits<br />
30,856,510<br />
30,856,510<br />
28,385,104<br />
3,486,778<br />
13,059,833<br />
11,838,493<br />
28,385,104<br />
In the event of the aircraft leases being terminated prior to their expiry, penalties are payable. Had these leases been cancelled at 31<br />
March <strong>2009</strong>, the penalties would have been AED 489.2 million (<strong>2008</strong>: AED 478.0 million).<br />
In addition, <strong>Emirates</strong> has eight Boeing aircraft contracted on operating leases for delivery between April <strong>2009</strong> and March 2014.<br />
24. Provisions<br />
<strong>2009</strong> <strong>2008</strong><br />
AED'000 AED'000<br />
366,943<br />
179,902<br />
546,845<br />
445,612<br />
124,731<br />
570,343<br />
In accordance with the provisions of IAS 19, management has carried out an exercise to assess the present value of its defined<br />
benefit obligations at 31 March <strong>2009</strong>, in respect of employees' end of service benefits payable under relevant local regulations and<br />
contractual arrangements. The assessment assumed expected salary increases averaging 5.0% (<strong>2008</strong>: 5.0%) and a discount rate<br />
of 6.5% (<strong>2008</strong>: 6.0%) per annum. The present values of the defined benefit obligations at 31 March <strong>2009</strong> were <strong>com</strong>puted using the<br />
actuarial assumptions set out above.<br />
The liabilities recognised in the balance sheet are:<br />
<strong>2009</strong> <strong>2008</strong><br />
AED'000 AED'000<br />
Present value of funded defined benefit obligations 635,394<br />
691,394<br />
Less: Fair value of plan assets<br />
(603,222) (672,899)<br />
32,172<br />
18,495<br />
Present value of unfunded defined benefit obligations 334,771<br />
427,117<br />
366,943<br />
445,612
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