Energy Transfer 2015 Annual Report Download - page 79

Table of Contents
was recorded related to the Permian Basin gathering and processing operations. The decline in estimated fair value of that reporting unit was primarily driven
by a significant decline in commodity prices in the fourth quarter of 2014, and the resulting impact to future commodity prices as well as increases in future
estimated operations and maintenance expenses.
 Our interest rate derivatives are not designated as hedges for accounting purposes; therefore, changes in fair value are
recorded in earnings each period. Losses on interest rate derivatives during the years ended December 31, 2015 and 2014 resulted from decreases in forward
interest rates, which caused our forward-starting swaps to decrease in value.
        See discussion of the unrealized gains (losses) on commodity risk management
activities included in “Segment Operating Results” below.
Inventory valuation reserve adjustments were recorded for the inventory associated with Sunoco Logistics’ crude oil, NGLs
and refined products inventories and our retail marketing operations as a result of commodity price changes between periods.
 In 2014, amounts were related to a marketing business that was sold effective April 1, 2014.
 and  See additional information in “Supplemental
Information on Unconsolidated Affiliates” and “Segment Operation Results” below.
 Other, net in 2015 and 2014 primarily includes amortization of regulatory assets and other income and expense amounts.
 For the year ended December 31, 2015, the Partnership’s effective income tax rate decreased from
the prior year primarily due to lower earnings among the Partnership’s consolidated corporate subsidiaries. The year ended December 31, 2015 also reflected
a benefit of $24 million of net state tax benefit attributable to statutory state rate changes resulting from the Regency Merger and sale of Susser to Sunoco LP,
as well as a favorable impact of $11 million due to a reduction in the statutory Texas franchise tax rate which was enacted by the Texas legislature during the
second quarter of 2015. For the year ended December 31, 2014, the Partnership’s income tax expense from continuing operations included unfavorable
income tax adjustments of $87 million related to the Lake Charles LNG Transaction, which was treated as a sale for tax purposes.
73