Description: Air Canada has been offering disgruntled customers cash or vouchers to settle their claims for travel interruptions. Thousands of Canadians have taken their disputes with Air Canada to the Canadian Transportation Agency (CTA), piling up a backlog of over 60,000 claims for compensation for disrupted travel and other matters. Air Canada maintains it pays customers who have legitimate claims and that is making these current offers to address the huge queue in the system. An Edmonton, Alberta university student, Samantha Smith, described Air Canada’s offer to her as “insulting,” noting she “felt very angry and just really dismayed” at what she saw as a low-ball offer from the airline.
Date: October 27, 2023
1) Have you or your classmates ever filed a claim with the CTA about a disappointing airline experience?
2) What do you think about Air Canada’s strategy on this issue? Will it help them in the marketplace?
3) Pages 10-9 through 10-11 of Wiley’s Financial Accounting: Tools for Business Decision-Making discusses the subject of provisions and contingencies. What type of financial statement treatment do you think Air Canada should use regarding these claims at the CTA?