Energy Transfer 2015 Annual Report Download - page 179

Table of Contents
Other Current Assets
Other current assets consisted of the following:
December 31,
2015
2014
Deposits paid to vendors $ 74
$ 65
Income taxes receivable 291
17
Prepaid expenses and other 137
200
Total other current assets $ 502
$ 282
Property, Plant and Equipment
Property, plant and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the
estimated useful or FERC mandated lives of the assets, if applicable. Expenditures for maintenance and repairs that do not add capacity or extend the
useful life are expensed as incurred. Expenditures to refurbish assets that either extend the useful lives of the asset or prevent environmental
contamination are capitalized and depreciated over the remaining useful life of the asset. Additionally, we capitalize certain costs directly related to the
construction of assets including internal labor costs, interest and engineering costs. Upon disposition or retirement of pipeline components or natural gas
plant components, any gain or loss is recorded to accumulated depreciation. When entire pipeline systems, gas plants or other property and equipment
are retired or sold, any gain or loss is included in our consolidated statements of operations.
Property, plant and equipment is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets
may not be recoverable. If such a review should indicate that the carrying amount of long-lived assets is not recoverable, we reduce the carrying amount
of such assets to fair value. In 2015, the Partnership recorded a $110 million fixed asset impairment related to the liquids transportation and services
segment primarily due to an expected decrease in future cash flows. No other fixed asset impairments were identified or recorded for our reporting units.
Capitalized interest is included for pipeline construction projects, except for certain interstate projects for which an allowance for funds used during
construction (“AFUDC”) is accrued. Interest is capitalized based on the current borrowing rate of our revolving credit facility when the related costs are
incurred. AFUDC is calculated under guidelines prescribed by the FERC and capitalized as part of the cost of utility plant for interstate projects. It
represents the cost of servicing the capital invested in construction work-in-process. AFUDC is segregated into two component parts – borrowed funds
and equity funds.
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