Amtrak 2015 Annual Report Download - page 20

National Railroad Passenger Corporation and Subsidiaries (Amtrak)
Notes to Consolidated Financial Statements (continued)
3. Basis of Presentation and Summary of Significant Accounting Policies (continued)
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Recently Adopted Accounting Pronouncements
In February 2013, the FASB issued Accounting Standards Update (ASU) No. 2013-02, Comprehensive
Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.
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 amounts being reclassified are required
under U.S. generally accepted accounting principles (GAAP). This ASU became effective for the Company
on October 1, 2014. The adoption of this ASU did not have a material impact on its consolidated financial
statements.
In November, 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification
of Deferred Taxes. To simplify the presentation of deferred income taxes, this ASU requires deferred income
tax liabilities and assets to be classified as noncurrent in a classified statement of financial position (previous
guidance required separation into current and noncurrent components). For entities other than public business
entities, the amendments are effective for fiscal years beginning after December 15, 2017, and interim periods
within fiscal years beginning after December 15, 2018. Early adoption is permitted for all entities as of the
beginning of an interim or annual reporting period. The guidance may be applied either prospectively, for
all deferred tax assets and liabilities, or retrospectively. Amtrak adopted this ASU for its FY2015 financial
statements. As all of Amtrak’s deferred income taxes were previously classified as noncurrent, the adoption
of this ASU had no impact on its consolidated financial statements.
Recently Issued but Not Yet Adopted Accounting Pronouncements
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606),
which supersedes previous revenue recognition guidance. The new standard requires that a company recognize
revenue when it transfers promised goods or services to customers in an amount that reflects the consideration
the company expects to receive in exchange for those goods and services. Companies will need to use more
judgment and estimates than under the guidance currently in effect, including estimating the amount of
variable revenue to recognize over each identified performance obligation. Additional disclosures will be
required to help users of financial statements understand the nature, amount and timing of revenue and cash
flows arising from the contracts. In August 2015, the FASB issued a deferral of the effective date of this
pronouncement. The new standard will become effective for the Company beginning with the fiscal year
ending September 30, 2020, and can be adopted either retrospectively to each prior reporting period presented
or as a cumulative effect adjustment as of the date of adoption. The Company is currently evaluating the
impact of adopting this new guidance on its consolidated financial statements.
In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern
(Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.
This ASU provides guidance about management’s responsibility to evaluate whether there is substantial doubt
about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The
guidance will be effective for the Company beginning with the fiscal year ending September 30, 2017, with
early adoption permitted. As the Company expects to continue to receive funding from the Federal
Government, Amtrak does not expect the adoption of this ASU to have a significant impact on its consolidated
statements of financial condition or results of operations.