Amtrak 2013 Annual Report Download - page 59

Download and view the complete annual report

Please find page 59 of the 2013 Amtrak annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 107

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107

National Railroad Passenger Corporation and Subsidiaries (Amtrak)
Notes to Consolidated Financial Statements (continued)
1411-1359280 20
4. Basis of Presentation and Summary of Significant Accounting Policies (continued)
Accounts Receivable and Allowance for Doubtful Accounts
Billed accounts receivable represent amounts for which invoices have been sent to customers.
These accounts receivable are recorded at the invoiced amount and do not bear interest. Unbilled
accounts receivable represent amounts recognized as revenue for which invoices have not yet
been sent to customers. The Company recorded $46.4 million and $35.6 million of unbilled
accounts receivable as of September 30, 2013 and 2012, respectively.
The allowance for doubtful accounts is the Company’ s best estimate of the amount of probable
credit losses in the Company’ s billed accounts receivable. To determine its allowance for
doubtful accounts, the Company evaluates historical loss experience and the characteristics of
current accounts, as well as general economic conditions and trends.
Materials and Supplies
Materials and supplies, which are stated at weighted-average cost, net of allowance for shrinkage
and obsolescence, consist primarily of items for maintenance and improvement of property and
equipment. An allowance for shrinkage and obsolescence is recorded based on specific
identification and expected usage rates.
Derivative and Hedging Activities
Amtrak periodically enters into derivative contracts to manage a portion of the exposure to
fluctuating energy prices. These derivative financial instruments, which inherently contain
market risk, are generally effective in reducing fluctuations in cash flows. Amtrak does not enter
into energy contracts for trading or speculative purposes.
Amtrak held three and four fuel derivative contracts as of September 30, 2013 and 2012,
respectively. Amtrak does not designate its derivative contracts as hedging instruments. Mark-to-
market gains and losses on these derivatives are recorded in current earnings in the Consolidated
Statements of Operations. Changes in fair value are recorded as a component of “Fuel, power,
and utilities” in the Consolidated Statements of Operations.