Eversource 2015 Annual Report Download - page 76

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64
The 2015 cash paid for interest excludes interest payments made by CL&P and WMECO in connection with the full satisfaction of their respective
obligations to the DOE for the disposal of spent nuclear fuel and high-level radioactive waste. For further information, see Note 8, “Long-Term
Debt,” to the financial statements.
In 2014, as a result of damages awarded to the Yankee Companies for spent nuclear fuel lawsuits against the DOE described in Note 11C,
“Commitments and Contingencies - Contractual Obligations - Yankee Companies,” Eversource received total proceeds of $132.1 million, which
were net of $80.6 million in proceeds CYAPC and YAEC returned to non-affiliated member companies.
Q. Related Parties
Eversource Service, Eversource’s service company, provides centralized accounting, administrative, engineering, financial, information technology,
legal, operational, planning, purchasing, and other services to Eversource’s companies. The Rocky River Realty Company, Renewable Properties,
Inc. and Properties, Inc., three other Eversource subsidiaries, construct, acquire or lease some of the property and facilities used by Eversource’s
companies.
As of both December 31, 2015 and 2014, CL&P, PSNH and WMECO had long-term receivables from Eversource Service in the amounts of $25
million, $3.8 million and $5.5 million, respectively, which were included in Other Long-Term Assets on the balance sheets. These amounts related
to the funding of investments held in trust by Eversource Service in connection with certain postretirement benefits for CL&P, PSNH and WMECO
employees and have been eliminated in consolidation on the Eversource financial statements.
Included in the CL&P, NSTAR Electric, PSNH and WMECO balance sheets as of December 31, 2015 and 2014 were Accounts Receivable from
Affiliated Companies and Accounts Payable to Affiliated Companies relating to transactions between CL&P, NSTAR Electric, PSNH and WMECO
and other subsidiaries that are wholly-owned by Eversource. These amounts have been eliminated in consolidation on the Eversource financial
statements.
R. Severance Benefits
For the years ended December 31, 2015, 2014 and 2013, Eversource recorded severance benefit expense of $4.7 million, $15 million and $9.7
million, respectively, in connection with organizational and cost saving initiatives, and, in 2014, the partial outsourcing of information technology
functions. As of December 31, 2015 and 2014, the severance accrual totaled $9.3 million and $10.4 million, respectively, and was included in Other
Current Liabilities on the balance sheets.
2. REGULATORY ACCOUNTING
Eversource’s Regulated companies are subject to rate-regulation that is based on cost recovery and meets the criteria for application of accounting
guidance for rate-regulated operations, which considers the effect of regulation on the timing of the recognition of certain revenues and expenses.
The Regulated companies’ financial statements reflect the effects of the rate-making process. The rates charged to the customers of Eversource’s
Regulated companies are designed to collect each company’s costs to provide service, including a return on investment.
Management believes it is probable that each of the Regulated companies will recover their respective investments in long-lived assets, including
regulatory assets. If management were to determine that it could no longer apply the accounting guidance applicable to rate-regulated enterprises to
any of the Regulated companies’ operations, or if management could not conclude it is probable that costs would be recovered from customers in
future rates, the costs would be charged to net income in the period in which the determination is made.
Regulatory Assets: The components of regulatory assets were as follows:
Eversource
As of December 31,
(Millions of Dollars)
2015
2014
Benefit Costs
$
1,828.2
$
2,016.0
Derivative Liabilities 388.0
425.5
Income Taxes, Net 650.9
635.3
Storm Restoration Costs 436.9
502.8
Goodwill-related 484.9
505.4
Regulatory Tracker Mechanisms 526.5
350.5
Contractual Obligations - Yankee Companies 134.4
123.8
Other Regulatory Assets 134.0
167.3
Total Regulatory Assets 4,583.8
4,726.6
Less: Current Portion 845.8
672.5
Total Long-Term Regulatory Assets $
3,738.0
$
4,054.1