Entergy 2014 Annual Report Download - page 75



ENTERGY CORPORATION AND SUBSIDIARIES

NOTES TO FINANCIAL STATEMENTS
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

7KH DFFRPSDQ\LQJ FRQVROLGDWHG ILQDQFLDO VWDWHPHQWV LQFOXGHWKHDFFRXQWV RI (QWHUJ\ &RUSRUDWLRQ DQG LWV
VXEVLGLDULHV $V UHTXLUHG E\ JHQHUDOO\ DFFHSWHG DFFRXQWLQJ SULQFLSOHV LQ WKH 8QLWHG 6WDWHV RI $PHULFD DOO
LQWHUFRPSDQ\ WUDQVDFWLRQV KDYH EHHQ HOLPLQDWHG LQ WKH FRQVROLGDWHG ILQDQFLDO VWDWHPHQWV  7KH 5HJLVWUDQW
6XEVLGLDULHVDQGPDQ\RWKHU (QWHUJ\VXEVLGLDULHV PDLQWDLQDFFRXQWVLQDFFRUGDQFHZLWK)(5&DQGRWKHUUHJXODWRU\
JXLGHOLQHV

Use of Estimates in the Preparation of Financial Statements

,Q FRQIRUPLW\ ZLWK JHQHUDOO\ DFFHSWHG DFFRXQWLQJ SULQFLSOHV LQ WKH 8QLWHG 6WDWHV RI $PHULFD WKH
SUHSDUDWLRQRI(QWHUJ\&RUSRUDWLRQ¶VFRQVROLGDWHGILQDQFLDOVWDWHPHQWVUHTXLUHVPDQDJHPHQWWRPDNHHVWLPDWHVDQG
DVVXPSWLRQV WKDW DIIHFW WKH UHSRUWHG DPRXQWV RI DVVHWV OLDELOLWLHV UHYHQXHV DQG H[SHQVHV DQG WKH GLVFORVXUH RI 
FRQWLQJHQWDVVHWVDQGOLDELOLWLHV$GMXVWPHQWVWRWKHUHSRUWHGDPRXQWVRIDVVHWVDQGOLDELOLWLHVPD\EHQHFHVVDU\LQ
WKHIXWXUHWRWKHH[WHQWWKDWIXWXUHHVWLPDWHVRUDFWXDOUHVXOWVDUHGLIIHUHQWIURPWKHHVWLPDWHVXVHG

Revenues and Fuel Costs

(QWHUJ\ $UNDQVDV (QWHUJ\ *XOI 6WDWHV /RXLVLDQD (QWHUJ\ /RXLVLDQD (QWHUJ\ 0LVVLVVLSSL DQG (QWHUJ\
7H[DV JHQHUDWH WUDQVPLW DQG GLVWULEXWH HOHFWULF SRZHU SULPDULO\ WR UHWDLO FXVWRPHUV LQ $UNDQVDV /RXLVLDQD
/RXLVLDQD 0LVVLVVLSSL DQG7H[DV UHVSHFWLYHO\ (QWHUJ\ *XOI 6WDWHV /RXLVLDQD DOVRGLVWULEXWHV QDWXUDO JDV WRUHWDLO
FXVWRPHUVLQDQGDURXQG%DWRQ5RXJH/RXLVLDQD(QWHUJ\1HZ2UOHDQVVHOOVERWKHOHFWULFSRZHUDQGQDWXUDOJDVWR
UHWDLO FXVWRPHUV LQ WKH &LW\ RI 1HZ 2UOHDQV H[FHSW IRU $OJLHUV ZKHUH (QWHUJ\ /RXLVLDQD LV WKH HOHFWULF SRZHU 
VXSSOLHU 7KH (QWHUJ\ :KROHVDOH &RPPRGLWLHV VHJPHQW GHULYHV DOPRVW DOO RI LWV UHYHQXH IURP VDOHV RI HOHFWULF
SRZHUJHQHUDWHGE\SODQWVRZQHGE\VXEVLGLDULHVLQWKDWVHJPHQW

(QWHUJ\UHFRJQL]HV UHYHQXH IURP HOHFWULF SRZHU DQG QDWXUDO JDV VDOHV ZKHQSRZHU RU JDV LVGHOLYHUHGWR
FXVWRPHUV 7RWKH H[WHQW WKDW GHOLYHULHVKDYH RFFXUUHGEXW D ELOO KDVQRW EHHQLVVXHG (QWHUJ\¶V 8WLOLW\RSHUDWLQJ
FRPSDQLHVDFFUXHDQHVWLPDWHRIWKHUHYHQXHVIRUHQHUJ\GHOLYHUHGVLQFHWKHODWHVWELOOLQJV7KH8WLOLW\RSHUDWLQJ
FRPSDQLHV FDOFXODWH WKHHVWLPDWHEDVHG XSRQVHYHUDO IDFWRUV LQFOXGLQJELOOLQJV WKURXJKWKH ODVW ELOOLQJ F\FOHLQ D
PRQWK DFWXDOJHQHUDWLRQLQWKHPRQWKKLVWRULFDOOLQHORVVIDFWRUVDQGSULFHVLQHIIHFWLQ(QWHUJ\¶V8WLOLW\RSHUDWLQJ
FRPSDQLHV¶YDULRXV MXULVGLFWLRQV &KDQJHV DUH PDGHWR WKHLQSXWVLQWKH HVWLPDWH DV QHHGHGWR UHIOHFWFKDQJHV LQ
ELOOLQJ SUDFWLFHV (DFK PRQWK WKH HVWLPDWHG XQELOOHG UHYHQXH DPRXQWV DUH UHFRUGHG DV UHYHQXH DQG XQELOOHG
DFFRXQWVUHFHLYDEOHDQGWKHSULRUPRQWK¶VHVWLPDWHLVUHYHUVHG7KHUHIRUHFKDQJHVLQSULFHDQGYROXPHGLIIHUHQFHV
UHVXOWLQJIURPIDFWRUVVXFKDVZHDWKHUDIIHFWWKHFDOFXODWLRQRIXQELOOHGUHYHQXHVIURPRQHSHULRGWRWKHQH[WDQG
PD\ UHVXOW LQ YDULDELOLW\ LQ UHSRUWHG UHYHQXHV IURP RQH SHULRG WR WKH QH[W DV SULRU HVWLPDWHV DUH UHYHUVHG DQG QHZ 
HVWLPDWHVUHFRUGHG

(QWHUJ\ UHFRUGV UHYHQXH IURP VDOHV XQGHU UDWHV LPSOHPHQWHG VXEMHFW WR UHIXQG OHVV HVWLPDWHG DPRXQWV
DFFUXHGIRUSUREDEOHUHIXQGVZKHQ(QWHUJ\EHOLHYHVLWLVSUREDEOHWKDWUHYHQXHVZLOOEHUHIXQGHGWRFXVWRPHUVEDVHG
XSRQWKHVWDWXVRIWKHUDWHSURFHHGLQJDVRIWKHGDWHWKHILQDQFLDOVWDWHPHQWVDUHSUHSDUHG

(QWHUJ\¶V 8WLOLW\RSHUDWLQJFRPSDQLHV¶UDWHVFKHGXOHV LQFOXGH HLWKHU IXHODGMXVWPHQW FODXVHVRU IL[HG IXHO
IDFWRUVZKLFKDOORZHLWKHUFXUUHQWUHFRYHU\LQELOOLQJVWRFXVWRPHUVRUGHIHUUDORIIXHOFRVWVXQWLOWKHFRVWVDUHELOOHG
WR FXVWRPHUV :KHUH WKH IXHO FRPSRQHQW RI UHYHQXHV LV ELOOHG EDVHG RQ D SUHGHWHUPLQHG IXHO FRVW IL[HG IXHO
IDFWRUWKHIXHOIDFWRUUHPDLQVLQHIIHFWXQWLOFKDQJHGDVSDUWRIDJHQHUDOUDWHFDVHIXHOUHFRQFLOLDWLRQRUIL[HGIXHO
IDFWRU ILOLQJ  6\VWHP (QHUJ\¶V RSHUDWLQJ UHYHQXHV DUH LQWHQGHG WR UHFRYHU IURP (QWHUJ\ $UNDQVDV (QWHUJ\
/RXLVLDQD(QWHUJ\0LVVLVVLSSLDQG(QWHUJ\1HZ2UOHDQVRSHUDWLQJH[SHQVHVDQGFDSLWDOFRVWVDWWULEXWDEOHWR*UDQG
*XOI7KHFDSLWDOFRVWVDUHFRPSXWHGE\DOORZLQJDUHWXUQRQ6\VWHP(QHUJ\¶VFRPPRQHTXLW\IXQGVDOORFDEOHWRLWV
QHWLQYHVWPHQWLQ*UDQG*XOISOXV6\VWHP(QHUJ\¶VHIIHFWLYHLQWHUHVWFRVWIRULWVGHEWDOORFDEOHWRLWVLQYHVWPHQWLQ
*UDQG*XOI
