Exelon 2015 Annual Report Download - page 251

Table of Contents
Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
Balance Sheet Classification of Deferred Taxes
In November 2015, the FASB issued authoritative guidance that requires deferred tax assets and deferred tax liabilities to be classified as
noncurrent in a classified statement of financial position. The guidance is effective for periods beginning after December 15, 2016, with early
adoption permitted. The guidance can be applied either prospectively or retrospectively. The Registrants early adopted the standard retrospectively
in the fourth quarter of 2015, resulting in the following impacts as of December 31, 2014 in the Consolidated Balance Sheets of the Registrants:
For the year ended December 31, 2014 Exelon Generation ComEd PECO BGE
Increase (Decrease)
Current assets—Deferred income taxes $ (244) $ (327) $ — $ (69) $ (6)
Deferred debits and other assets—Other 3 — — — —
Current liabilities—Deferred income taxes — — (63) — (52)
Deferred credits and other liabilities—Deferred income taxes (241) (327) 63 (69) 46
The adoption of this guidance had no impact on the Registrants’ Consolidated Statements of Operations and Comprehensive Income and
Consolidated Statements of Cash Flows.
Simplifying the Accounting for Measurement-Period Adjustments
In September 2015, the FASB issued authoritative guidance that requires an acquirer in a business combination to recognize adjustments to
provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined and
to record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if
any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. Under
current guidance, such effects would be retrospectively recorded in prior periods. The guidance is effective for periods beginning after
December 15, 2015. The guidance is required to be applied prospectively to adjustments to provisional amounts that occur after the effective date
with earlier application permitted for financial statements that have not been issued. The Registrants early adopted the standard in the fourth
quarter of 2015. The adoption of this guidance had no impact on the Registrants’ Consolidated Balance Sheets, Consolidated Statements of
Operations and Comprehensive Income, Consolidated Statements of Cash Flows and disclosures.
Application of Normal Purchases Normal Sales Exception to Power Contracts in Nodal Energy Markets
In August 2015, the FASB issued authoritative guidance addressing the ability of entities to elect the normal purchase normal sales (NPNS)
scope exception when the contract for the purchase or sale of electricity on a forward basis is delivered to a nodal energy market or transmitted
through a nodal energy market. The NPNS scope exception allows entities to treat certain contracts that qualify as derivatives as contracts that do
not require recognition at fair value. The guidance specifies that the use of locational marginal pricing by an independent system operator in such
transactions does not constitute net settlement of a contract for the purchase or sale of electricity, even in scenarios in which legal title to the
associated electricity is conveyed to the independent system operator during transmission. Consequently, the use of locational marginal pricing by
the independent system operator does not cause that contract to fail to meet the physical delivery criterion of the NPNS scope exception.
Consistent with the Registrants’ current practice, if the physical delivery criterion is met, along with all of the other criteria of the NPNS scope
exception, an entity may elect to designate that contract as
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Source: BALTIMORE GAS & ELECTRIC CO, 10-K, February 10, 2016 Powered by Morningstar® Document Research℠
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