Access the financial statements of Air Canada for the year ended December 31, 2020, through SEDAR (www.sedar.com) or the company’s website. Review the financial statements, including the notes, and then answer the following questions.

Instructions

a. Calculate the 2020 and 2019 debt to equity ratios and the times interest earned ratio for Air Canada based on numbers provided on its statements of financial position and its income statements. Comment on the comparative results of these two ratios over the two years. If there are significant differences, comment on why you think that is and summarize what has changed from year to year.

b. Refer to the capital disclosure note. Using the “net debt” amount reported in the note, recalculate the debt to equity ratios. Comment on the results relative to those in part (a) above. How did Air Canada adjust its debt number?

c. Is there any mention of sustainability in the financial statements and notes? How is sustainability related to debt given the issues that Air Canada faced in 2020? Does Air Canada publish any other documents that communicate its sustainability goals?