The table below shows our net pension expense for the years ended December 31, 2013 and 2012. Net interest cost is included in finance costs and other pension expenses are included in the salaries and benefits expense in the consolidated statements of income. We also provide supplemental unfunded pension benefits to certain executives. The table below includes our accrued benefit obligations, pension expense included in employee salaries and benefits, net interest cost and other comprehensive income. Certain subsidiaries have defined contribution plans with total pension expense of $2 million in 2013 (2012 – $2 million), which is included in employee salaries and benefits expense. There are significant assumptions that are used in the calculations provided by our actuaries, and it is the responsibility of management to determine which assumptions could result in a significant impact when determining the accrued benefit obligations and pension expense. We estimate our 2014 employer contributions to be $96 million. The average duration of the defined benefit obligation at December 31, 2013 is 19 years. Actual return on plan assets was $102 million in 2013 (2012 – $75 million). We have recognized a cumulative loss in other comprehensive income and retained earnings of $201 million at December 31, 2013 (December 31, 2012 – $299 million). The table below shows the actual contributions to the plans for the years ended December 31: We make contributions to the plans to secure the benefits of plan members and invest in permitted investments using the target ranges established by our Pension Committee, which reviews actuarial assumptions on an annual basis. Plan assets consist primarily of pooled funds that invest in common stocks and bonds. The pooled Canadian equity funds has investments in our equity securities. As a result, approximately $3 million (2012 – $2 million) of the plans’ assets are indirectly invested in our own equity securities. In the sensitivity analysis shown below, we determine the defined benefit obligation using the same method used to calculate the defined benefit obligation we recognize in the consolidated statements of financial position. We calculate sensitivity by changing one assumption while holding the others constant. The actual change in defined benefit obligation will likely be different from that shown in the table, since it is likely that more than one assumption will change at a time, and that some assumptions are correlated. Sensitivity of Key Assumptions Allocation of Plan Assets Assumptions Principal Actuarial Assumptions NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 2013 2012 Plan cost: Service cost $ 71 $ 46 Net interest cost 12 5 Net pension expense 83 51 Administrative expense 2 2 Total pension cost recognized in net income $ 85 $ 53 Net interest cost, a component of the plan cost above is included in finance costs and is outlined as follows. 2013 2012 Net interest cost: Interest income on plan assets $ (40) $ (40) Interest cost on plan obligation 52 45 Net interest cost recognized in finance costs $1 2 $ 5 2013 2012 Return on plan assets (excluding interest income) $ 65 $ 37 Change in financial assumptions 140 (220) Change in demographic assumptions (43) – Effect of experience adjustments (16) (49) Change in asset ceiling (9) – Remeasurement recognized in other comprehensive income (loss) and equity $ 137 $ (232) 2013 2012 Accrued benefit obligation $4 9 $4 5 Pension expense included in employee salaries and benefits expense 2 2 Net interest cost recognized in finance costs 2 2 Remeasurement recognized in other comprehensive income 3 5 2013 2012 Weighted average of significant assumptions: Defined benefit obligation Discount rate 5.1% 4.5% Rate of compensation increase 3.0% 3.0% Mortality rate CPM-RPP2014 Priv UP94 Generational Pension expense Discount rate 4.5% 5.5% Rate of compensation increase 3.0% 3.0% Mortality rate UP94 Generational UP94 Generational Employer Employee Total 2013 $ 101 $ 26 $ 127 2012 85 23 108 Percentage of plan assets Target asset allocation percentage Asset category December 31, 2013 December 31, 2012 Equity securities: Domestic 20.1% 19.3% 10% to 29% International 40.7% 38.3% 29% to 48% Debt securities 38.9% 41.8% 38% to 47% Other – cash 0.3% 0.6% 0% to 2% 100.0% 100.0% 2013 ANNUAL REPORT ROGERS COMMUNICATIONS INC. 119 The remeasurement recognized in other comprehensive income, is determined as follows. Increase/(decrease) in accrued benefit obligation Increase/(decrease) in pension expense 2013 2012 2013 2012 Discount rate Impact of: 0.5% increase $ (105) $ (99) $ (11) $ (11) 0.5% decrease 120 110 13 9 Rate of future compensation increase Impact of: 0.25% increase $ 14 $ 15 $ 3 $ 1 0.25% decrease (14) (15) (2) (3) Mortality rate Impact of: 1 year increase $ 26 $ 28 $ 4 $ 1 1 year decrease (27) (28) (3) (4)