Amtrak 2015 Annual Report Download - page 13

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National Railroad Passenger Corporation and Subsidiaries (Amtrak)
Notes to Consolidated Financial Statements (continued)
2. Annual Funding (continued)
11
begin for Amtrak’s FY2016, the FY2016 Appropriations Law was drafted before the FAST Act was enacted,
which deferred the implementation until FY2017. Accordingly, for FY2016, Amtrak received a capital and
debt service grant and an operating grant, consistent with past practice.
3. Basis of Presentation and Summary of Significant Accounting Policies
Method of Accounting
The accompanying consolidated financial statements are presented using the accrual basis of accounting in
accordance with accounting principles generally accepted in the United States of America.
Principles of Consolidation
The Consolidated Financial Statements reflect the consolidated operations of Amtrak and its four subsidiaries,
Chicago Union Station Company (CUS), Passenger Railroad Insurance, Limited (PRIL), Penn Station
Leasing, LLC (PSL) and Washington Terminal Company (WTC). All significant intercompany balances and
transactions have been eliminated.
CUS was incorporated on July 3, 1913 as the Union Station Company, for the purpose of constructing,
operating and maintaining a new railroad terminal in the City of Chicago. The name was officially changed
to Chicago Union Station Company on May 7, 1915. Amtrak acquired 50% stock ownership interest in CUS
in 1976 as part of the conveyance of the NEC and off-Corridor properties. Amtrak purchased the remaining
50% stock ownership in 1984. CUS’s business is comprised of the following segments: provision of right of
way and station access and use of intercity and commuter services; and lease and licensing of station space
for retail services, display advertising, special events and other commercial uses.
PRIL was incorporated on December 18, 1996 under the laws of Bermuda to provide excess liability and
property insurance coverage to Amtrak. In addition, PRIL also provides insurance and reinsurance coverage
to third parties performing work on Amtrak property.
PSL was formed on April 17, 2001 to acquire and lease back to Amtrak the real property and improvements
located in New York, commonly known as Penn Station.
WTC was formed on December 6, 1901 and is comprised of buildings and rail yard adjacent to Washington
Union Station. WTC provides switching services for passenger trains using the station or passing through
the area.
Cash and Cash Equivalents
All short-term investments with original maturities of 90 days or less are considered cash and cash equivalents.
These consist of bank deposits, money market fund investments, and treasury bills. Cash and cash equivalents
are maintained at various financial institutions and, at times, balances may exceed federally insured limits.
Restricted Cash and Cash Equivalents
Restricted cash and cash equivalents consist primarily of funds received that are restricted for specific purposes
or cash set aside and restricted for specific payments. The balance in restricted cash and cash equivalents as