APS 2014 Annual Report Download - page 11

Investment Valuation
The Plan’s investments are stated at fair value, less costs to sell, if those costs are significant. Fair value is the price that would
be received upon the sale of an asset or the amount paid to transfer a liability in an orderly transaction between market participants at
the measurement date. See Note 6 for fair value measurements and disclosures of the Plan’s investments.
In accordance with GAAP, fully benefit-responsive investment contracts held in the Stable Value Fund are included at fair value
in the statements of net assets available for benefits, and an additional line item is presented representing the adjustments from fair value
to contract value. Contract value is the amount Plan participants would receive if they were to initiate permitted transactions under the
terms of the Plan. The statement of changes in net assets available for benefits is presented on a contract value basis. (See Note 4).
Income Recognition
Purchases and sales of securities are recorded as of the trade date. Interest income is recorded on the accrual basis. Dividend
income is recorded as of the ex-dividend date.
Administrative Expenses
Participants pay a quarterly Plan recordkeeping fee. Participants may also pay administrative fees for the origination of a loan or
for other services provided by the Trustee. Participants pay investment, sales, recordkeeping and administrative expenses charged by
the Funds, if any, which are deducted from income and reflected as a reduction of investment return for the Fund. Pinnacle West pays
the remaining Plan administrative expenses, such as legal and trustee expenses of the Plan.
Management fees and operating expenses charged to the Plan for investments in mutual funds are deducted from income earned
on a daily basis and are not separately reflected. Consequently, management fees are reflected as a reduction of investment return for
such investments.
Notes Receivable From Participants
Notes receivable from participants are measured at their unpaid principal balance plus any accrued but unpaid interest.
Delinquent participant loans are recorded as distributions based on the terms of the Plan.
Payment of Benefits
Benefit payments to participants are recorded upon distribution. As of December 31, 2014 and 2013, there were no amounts
allocated to accounts of persons who have elected to withdraw from the Plan, but have not yet been paid.
Excess Contributions Payable
The Plan is required to return contributions received during the Plan year in excess of the Internal Revenue Code limits.
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