Eversource 2010 Annual Report Download - page 83

66
The Company does not have any variable interests in an unconsolidated VIE that are material to the accompanying consolidated
financial statements.
In accordance with accounting guidance on noncontrolling interests in consolidated financial statements effective January 1, 2009, the
Preferred Stock of CL&P, which is not owned by NU or its consolidated subsidiaries and is not subject to mandatory redemption, has
been presented as a noncontrolling interest in CL&P in the accompanying consolidated financial statements of NU. The Preferred
Stock of CL&P is considered to be temporary equity and has been classified between liabilities and permanent shareholders' equity on
the accompanying consolidated balance sheets of NU and CL&P due to a provision in CL&P's certificate of incorporation that grants
preferred stockholders the right to elect a majority of CL&P's board of directors should certain conditions exist, such as if preferred
dividends are in arrears for one year. The Net Income reported in the accompanying consolidated statements of income and cash
flows represents consolidated net income prior to apportionment to noncontrolling interests, which is represented by dividends on
preferred stock of CL&P and NSTAR's portion of the net income of NPT.
The included presentation and disclosure requirements effective January 1, 2009 have been applied retrospectively to the consolidated
statements of income, comprehensive income, common shareholders' equity, and cash flows for the year ended December 31, 2008.
For the years ended December 31, 2010, 2009 and 2008, there was no change in NU parent's 100 percent ownership of the common
equity of CL&P.
Certain other reclassifications of prior period data were made in the accompanying consolidated balance sheets and statements of cash
flows for all companies presented. These reclassifications were made to conform to the current year's presentation.
NU evaluates events and transactions that occur after the balance sheet date but before financial statements are issued and
recognizes in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed
as of the balance sheet date and discloses but does not recognize in the financial statements subsequent events that provide evidence
about the conditions that arose after the balance sheet date but before the financial statements are issued. See Note 22, "Subsequent
Event," for further information.
C. About NU, CL&P, PSNH and WMECO
Consolidated: NU is the parent company of CL&P, PSNH, WMECO, Yankee Gas and NU Enterprises, as described below. NU was
formed on July 1, 1966 when CL&P, WMECO and The Hartford Electric Light Company affiliated under the common ownership of NU.
In 1992, PSNH became a subsidiary of NU. On March 1, 2000, natural gas became an integral part of NU's Connecticut operations
when NU's merger with Yankee and its principal subsidiary, Yankee Gas, was completed. CL&P, PSNH and WMECO are reporting
companies under the Securities Exchange Act of 1934. NU is a public utility holding company under the Public Utility Holding Company
Act of 2005. Arrangements among the regulated electric companies, NU Enterprises and other NU companies, outside agencies and
other utilities covering interconnections, interchange of electric power and sales of utility property are subject to regulation by the FERC.
The Regulated companies are subject to further regulation for rates, accounting and other matters by the FERC and/or applicable state
regulatory commissions (the DPUC for CL&P and Yankee Gas, the NHPUC as well as certain regulatory oversight by the Vermont
Department of Public Service and the Maine Public Utilities Commission for PSNH, and the DPU for WMECO).
Regulated Companies: CL&P, PSNH and WMECO furnish franchised retail electric service in Connecticut, New Hampshire and
Massachusetts, respectively. Yankee Gas owns and operates Connecticut's largest natural gas distribution system. CL&P, PSNH and
WMECO's results include the operations of their respective distribution and transmission segments. PSNH's and WMECO's distribution
results include the operations of their respective generation businesses. Yankee Gas' results include the operations of its natural gas
distribution segment. NPT was formed to construct, own and operate the Northern Pass line, a new HVDC transmission line from
Québec to New Hampshire that will interconnect with a new HVDC transmission line being developed by a transmission subsidiary of
HQ.
NU Enterprises: NU Enterprises is the parent company of Select Energy, Boulos, NGS, NGS Mechanical and SECI. As of
December 31, 2010, NU Enterprises’ primary business consisted of (i) Select Energy’s remaining energy wholesale marketing
contracts, and (ii) NGS’ operation and maintenance agreements as well as its subsidiary, Boulos, an electrical contractor based in
Maine that NU Enterprises continues to own and manage.
D. Cash and Cash Equivalents
Cash and cash equivalents include cash on hand and short-term cash investments that are highly liquid in nature and have original
maturities of three months or less. At the end of each reporting period, any overdraft amounts are reclassified from Cash and Cash
Equivalents to Accounts Payable on the accompanying consolidated balance sheets.
E. Restricted Cash
As of December 31, 2009, PSNH had $10 million of restricted cash held with a trustee related to insurance proceeds received on
bondable property, which was included in Prepayments and Other Current Assets on the accompanying consolidated balance sheet.
These funds were released from the trustee during the second quarter of 2010 and there was no restricted cash held as of
December 31, 2010.