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## ALGONQUIN POWER & UTILITIES CORP. 

Notes to the Consolidated Financial Statements December 31, 2012 and 2011  (in thousands of Canadian dollars except as noted and amounts per share) 

## 11. Pension and other post-retirement benefits (continued) 

(c) Assumptions (continued) 

The effect of a one percent change in the assumed health care cost trend rate (HCCTR) for 2012 is as follows: 

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(d) Benefit costs 

The following table lists the components of net benefit costs for the pension plans and OPEB recorded as part of administrative expenses in the Consolidated Statement of Operations. 

The employee benefit costs related to business acquired are recorded in the Consolidated Statement of Operations from the date of acquisition. The portion of employee benefit capitalized as cost of construction is insignificant. 

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The net actuarial loss for the defined benefit pension plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year are $11 and $37, respectively. 

(e) Plan assets 

The Company’s investment strategy for its pension and post-retirement plan assets is to maintain a diversified portfolio of assets with the primary goal of meeting long-term cash requirements as they become due. The total amount of plan assets acquired through business acquisitions in 2012 was determined but had not been transferred to the Company as at December 31, 2012. An estimate of the assets to be transferred adjusted for estimated return, contributions and benefits was used to estimate the funded status at December 31, 2012. Detailed investment allocation decisions will be finalized following the plan asset transfer that is expected to occur in the first quarter of 2013. 

(f) Cash flows 

The Company expects to contribute $2,309 to its pension plans and $1,311 to its postretirement benefit plans in 2013. 

The expected benefit payments over the next ten years are as follows: 

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