Xcel Energy 2015 Annual Report Download - page 108
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Benefit Plans and Other Postretirement Benefits — Xcel Energy maintains pension and postretirement benefit plans for eligible
employees. Recognizing the cost of providing benefits and measuring the projected benefit obligation of these plans under applicable
accounting guidance requires management to make various assumptions and estimates.
Based on the regulatory recovery mechanisms of Xcel Energy Inc.’s utility subsidiaries, certain unrecognized actuarial gains and
losses and unrecognized prior service costs or credits are recorded as regulatory assets and liabilities, rather than OCI.
See Note 9 for further discussion of benefit plans and other postretirement benefits.
Guarantees — Xcel Energy recognizes, upon issuance or modification of a guarantee, a liability for the fair market value of the
obligation that has been assumed in issuing the guarantee. This liability includes consideration of specific triggering events and other
conditions which may modify the ongoing obligation to perform under the guarantee.
The obligation recognized is reduced over the term of the guarantee as Xcel Energy is released from risk under the guarantee. See
Note 13 for specific details of issued guarantees.
Subsequent Events — Management has evaluated the impact of events occurring after Dec. 31, 2015 up to the date of issuance of
these consolidated financial statements. These statements contain all necessary adjustments and disclosures resulting from that
evaluation.
2. Accounting Pronouncements
Recently Issued
Revenue Recognition — In May 2014, the FASB issued Revenue from Contracts with Customers, Topic 606 (ASU No. 2014-09),
which provides a framework for the recognition of revenue, with the objective that recognized revenues properly reflect amounts an
entity is entitled to receive in exchange for goods and services. The new guidance also includes additional disclosure requirements
regarding revenue, cash flows and obligations related to contracts with customers. As a result of the FASB’s July 2015 deferral of the
standard’s required implementation date, the guidance is effective for interim and annual reporting periods beginning after Dec. 15,
2017. Xcel Energy is currently evaluating the impact of adopting ASU 2014-09 on its consolidated financial statements.
Consolidation — In February 2015, the FASB issued Amendments to the Consolidation Analysis, Topic 810 (ASU No. 2015-02),
which reduces the number of consolidation models and amends certain consolidation principles related to variable interest entities.
This guidance will be effective for interim and annual reporting periods beginning after Dec. 15, 2015, and early adoption is
permitted. Xcel Energy does not expect the implementation of ASU 2015-02 to have a material impact on its consolidated financial
statements.
Presentation of Debt Issuance Costs — In April 2015, the FASB issued Simplifying the Presentation of Debt Issuance Costs, Subtopic
835-30 (ASU No. 2015-03), which amends existing guidance to require the presentation of debt issuance costs on the balance sheet as
a deduction from the carrying amount of the related debt, instead of an asset. This guidance will be effective for interim and annual
reporting periods beginning after Dec. 15, 2015, and early adoption is permitted. Other than the prescribed reclassification of assets to
an offset of debt on the consolidated balance sheets, Xcel Energy does not expect the implementation of ASU 2015-03 to have a
material impact on its consolidated financial statements.
Fair Value Measurement — In May 2015, the FASB issued Disclosures for Investments in Certain Entities that Calculate Net Asset
Value per Share (or Its Equivalent), Topic 820 (ASU No. 2015-07), which removes the requirement to categorize fair value
measurements using a net asset value methodology in the fair value hierarchy. This guidance will be effective on a retrospective basis,
effective for interim and annual reporting periods beginning after Dec. 15, 2015, and early adoption is permitted. Other than the
reduced disclosure requirements, Xcel Energy does not expect the implementation of ASU 2015-07 to have a material impact on its
consolidated financial statements.
Presentation of Deferred Taxes — In November 2015, the FASB issued Balance Sheet Classification of Deferred Taxes, Topic 740
(ASU No 2015-17), which removes the requirement to present deferred tax assets and liabilities as current and noncurrent on the
balance sheet based on the classification of the related asset or liability, and instead requires classification of all deferred tax assets and
liabilities as noncurrent. This guidance will be effective for interim and annual reporting periods beginning after Dec. 15, 2016, and
early adoption is permitted. Other than the prescribed classification of all deferred tax assets and liabilities as noncurrent, Xcel Energy
does not expect the implementation of ASU 2015-17 to have a material impact on its consolidated financial statements.