Dominion Power 2007 Annual Report Download - page 79

at fair value in the financial statements on a recurring basis (at
least annually).
In January 2008, the FASB proposed FSP FAS No. 157-c,
Measuring Liabilities Under FASB Statement No. 157, which if
issued would clarify the principles in SFAS No. 157 for the fair
value measurements of liabilities. Specifically, this FSP would
require an entity to measure liabilities first based on a quoted
price in an active market for an identical liability, however in the
absence of such information, an entity would be allowed to
measure the fair value of the liability at the amount it would
receive as proceeds if it were to issue that liability at the measure-
ment date.
SFAS N O . 159
In February 2007, the FASB issued SFAS No. 159, The Fair
Value Option for Financial Assets and Financial Liabilities (SFAS
No. 159).SFAS No. 159 provides an entity with the option, at
specified election dates, to measure certain financial assets and
liabilities and other items at fair value, with changes in fair value
recognized in earnings as those changes occur. SFAS No. 159 also
establishes presentation and disclosure requirements that include
displaying the fair value of those assets and liabilities for which
the entity elected the fair value option on the face of the balance
sheet and providing management’s reasons for electing the fair
value option for each eligible item. The provisions of SFAS
No. 159 became effective for us beginning January 1, 2008. We
are currently evaluating whether fair value accounting is appro-
priate for any of our eligible items and cannot estimate the impact
that SFAS No. 159 may have on our results of operations and
financial condition.
SFAS N
O . 141R
In December 2007, the FASB issued SFAS No. 141 (revised
2007), Business Combinations (SFAS No. 141R). SFAS No. 141R
requires an acquirer to recognize the assets acquired, the liabilities
assumed and any noncontrolling interest in the acquiree at their
acquisition-date fair values. SFAS No. 141R also requires dis-
closure of the information necessary for investors and other users
to evaluate and understand the nature and financial effect of the
business combination. Additionally, SFAS No. 141R requires that
acquisition-related costs be expensed as incurred. SFAS No. 141R
amends SFAS No. 109 to require the acquirer to recognize
changes in the amount of its deferred tax benefits recognizable
due to a business combination either in income from continuing
operations in the period of the combination or directly in con-
tributed capital, depending on the circumstances. The provisions
of SFAS No. 141R will become effective for acquisitions on or
after January 1, 2009, except for the tax provisions which apply to
business combinations regardless of the acquisition date.
SFAS N
O . 160
In December 2007, the FASB issued SFAS No. 160, Non-
controlling Interests in Consolidated Financial Statements (SFAS
No. 160). SFAS No. 160 requires that noncontrolling (minority)
interests be reported as a component of equity, net income attrib-
utable to the parent and to the non-controlling interest be sepa-
rately identified in the income statement, changes in a parent’s
ownership interest while the parent retains its controlling interest
be accounted for as equity transactions, and any retained non-
controlling equity investment upon the deconsolidation of a sub-
sidiary be initially measured at fair value. The provisions of SFAS
No. 160 will become effective for us beginning January 1,
2009. We are currently evaluating the impact that SFAS No. 160
will have on our results of operations and financial condition.
EITF 06-4
In September 2006, the FASB ratified the consensus reached by
the EITF on Issue No. 06-4, Accounting for Deferred Compensa-
tion and Postretirement Benefit Aspects of Endorsement Split-Dollar
Life Insurance Arrangements (EITF 06-4). EITF 06-4 specifies
that if an employer provides a benefit to an employee under an
endorsement split-dollar life insurance arrangement that extends
to postretirement periods, it should recognize a liability for future
benefits in accordance with SFAS No. 106 (if, in substance, a
postretirement benefit plan exists) or APB Opinion No. 12,
Deferred Compensation Contracts (if the arrangement is, in sub-
stance, an individual deferred compensation contract) based on
the substantive agreement with the employee. The provisions of
EITF 06-4 became effective for us beginning January 1, 2008 and
will not have a material impact on our results of operations or
financial condition.
EITF 06-11
In June 2007, the FASB ratified the consensus reached by the
EITF on Issue No. 06-11, Accounting for Income Tax Benefits of
Dividends on Share-Based Payment Awards (EITF 06-11). EITF
06-11 addresses the recognition of income tax benefits realized
from dividends or dividend equivalents that are charged to
retained earnings and are paid to employees for nonvested equity-
classified share-based payment awards. Effective January 1, 2008,
we began recognizing such income tax benefits as an increase to
additional paid-in capital rather than as a reduction to income tax
expense. We do not expect EITF 06-11 to have a material impact
on our results of operations or financial condition.
FSP FIN 39-1
In April 2007, the FASB issued FSP No. FIN 39-1, Amendment
of FASB Interpretation No. 39, Offsetting of Amounts Related to
Certain Contracts (FSP FIN 39-1). FSP FIN 39-1 amends FIN 39
to permit the offsetting of amounts recognized for the right to
reclaim cash collateral or the obligation to return cash collateral
against amounts recognized for derivative instruments executed
with the same counterparty under the same master netting
arrangement that have been offset. FSP FIN 39-1 became effec-
tive for us beginning January 1, 2008 and must be applied retro-
actively to all financial statements presented, unless it is
impracticable to do so. We are currently evaluating the impact
that FSP FIN 39-1 may have on our financial condition. We do
not expect FSP FIN 39-1 to have an impact on our results of
operations or cash flows.
Dominion 2007 Annual Report 77