Amtrak 2014 Annual Report Download - page 29

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National Railroad Passenger Corporation and Subsidiaries (Amtrak)
Notes to Consolidated Financial Statements (continued)
1509-1694994 21
3. Basis of Presentation and Summary of Significant Accounting Policies (continued)
The Company bases these estimates on historical experience, the current economic environment,
and various other assumptions that are believed to be reasonable under the circumstances.
However, uncertainties associated with these estimates exist and actual results may differ from
these estimates. Some of the more significant estimates include: allowance for doubtful accounts
and obsolescence of material and supplies, estimated useful lives of property and equipment,
calculation of accelerated depreciation related to Sandy, recoverability of long-lived assets,
estimates of wrecked and damaged equipment, estimates of casualty reserves, pension and other
postretirement employee benefits expense and obligations (including expected return on plan
assets, discount rates, rate of future compensation increases, and health care cost trend rates),
estimated costs for retroactive wages for union employees, estimated costs of asset retirement
obligations, valuation allowance for deferred tax assets and environmental reserves.
Comprehensive Loss
Amtrak reports a comprehensive loss in the Consolidated Statements of Comprehensive Loss.
Comprehensive loss is defined as changes in equity of a business enterprise during a period from
transactions and other events and circumstances from non-owner sources. As of September 30,
2014 and 2013, “Accumulated other comprehensive loss” consists of adjustments for pension
and other postretirement liabilities.
Recent Accounting Pronouncements
In February 2013, the FASB issued Accounting Standards Update (ASU) No. 2013-02,
Comprehensive Income (Topic 220). This guidance seeks to improve the reporting of
reclassifications out of accumulated other comprehensive income. Companies are required to
report the effect of significant reclassifications out of accumulated other comprehensive income
on the respective line items in net income if the amount being reclassified is required under U.S.
generally accepted accounting principles (GAAP). This update will become effective for the
Company beginning with FY2015. The Company does not expect the adoption of this standard
to have a material impact on its financial condition or results of operations.