Vectren 2012 Annual Report Download - page 118

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116
23. Impact of Recently Issued Accounting Guidance
Other Comprehensive Income (OCI)
In 2011, the FASB issued new accounting guidance regarding the presentation of comprehensive income within financial
statements. The new guidance requires entities to report components of comprehensive income in either (1) a continuous
statement of comprehensive income or (2) two separate but consecutive statements. Under the two-statement approach, the
first statement would include components of net income, which is consistent with the income statement format used today, and
the second statement would include components of OCI. The guidance does not change the items that must be reported in
OCI. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2011
and retrospective application is required. The Company adopted this guidance, as amended for condensed quarterly reporting,
for the quarterly reporting period ended March 31, 2012 by reporting comprehensive income as required.
Goodwill Testing
In September 2011, the FASB issued new accounting guidance regarding testing goodwill for impairment. The new guidance
allows the Company an option to first assess qualitative factors to determine whether it is necessary to perform the two-step
quantitative goodwill impairment test. Using the new guidance, the Company no longer would be required to calculate the fair
value of a reporting unit unless the Company determines, based on that qualitative assessment, that it is more likely than not
that its fair value is less than its carrying amount. The Company considered this option during its quarterly reporting period
ended March 31, 2012 and concluded the continuation of the use of a quantitative approach is appropriate.
Fair Value Measurement and Disclosure
In May 2011, the FASB issued accounting guidance to improve the comparability of fair value measurements presented and
disclosed in financial statements prepared in accordance with U.S. GAAP and International Financial Reporting Standards
(IFRS). The amendments are not intended to change the application of the current fair value requirements, but to clarify the
application of existing requirements. The guidance does change particular principles or requirements for measuring fair value or
disclosing information about fair value measurements. To improve consistency, language has been changed to ensure that U.S.
GAAP and IFRS fair value measurement and disclosure requirements are described in the same way. The Company adopted
this guidance for its quarterly reporting period ended March 31, 2012. The adoption of this guidance did not have a material
impact on our financial position, results of operations or cash flows.
24. Quarterly Financial Data (Unaudited)
Information in any one quarterly period is not indicative of annual results due to the seasonal variations common to the
Company’s utility operations. Summarized quarterly financial data for 2012 and 2011 follows:
(In millions, except per share amounts) Q1 Q2 Q3 Q4
2012
Operating revenues $ 604.6 $ 470.6 $ 513.5 $ 644.1
Operating income 109.9 70.2 81.6 90.8
Net income 51.3 25.6 39.3 42.8
Earnings per share:
Basic $ 0.63 $ 0.31 $ 0.48 $ 0.52
Diluted 0.62 0.31 0.48 0.52
2011
Operating revenues $ 682.6 $ 475.8 $ 539.4 $ 627.4
Operating income 103.3 61.6 94.1 111.0
Net income 44.6 15.1 35.3 46.6
Earnings per share:
Basic $ 0.55 $ 0.19 $ 0.43 $ 0.56
Diluted 0.55 0.18 0.43 0.56