In July 2006, the FASB issued FASB Interpretation
No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN No. 48"), which
clarifies the accounting for uncertainty in income taxes recognized in a company's financial
statements in accordance with FASB Statement No. 109, "Accounting for Income Taxes."
The interpretation prescribes a recognition threshold and measurement criteria for the financial
statement recognition and measurement of a tax position taken or expected to be taken in a tax
return. It also provides guidance on derecognition, classification, interest and penalties,
accounting in interim periods, disclosure and transition.
IPALCO adopted the provisions of FIN No. 48 on January 1, 2007. Under FIN No. 48, IPALCO
must recognize the tax benefit from an uncertain tax position only if it is more likely than not
that the tax position will be sustained on examination by the taxing authorities, based on the
technical merits of the position. The tax benefits recognized in the financial statements from such
a position are measured based on the largest benefit that has a greater than fifty percent
likelihood of being realized upon ultimate resolution. The impact of IPALCO's reassessment of its
tax positions in accordance with FIN No. 48 did not have a material effect on the results of
operations, financial condition or liquidity. See Note 6 "Income Taxes".
Statement of Financial Accounting Standards ("SFAS") No. 157 "Fair Value
Measurements"
In September 2006, the FASB released SFAS No. 157, "Fair Value Measurements," to
define fair value, establish a framework for measuring fair value in accordance with accounting
principles generally accepted in the United States of America, and expand disclosures about fair
value measurements. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007.
Management has determined that SFAS No. 157 will not change the way we currently estimate fair value
on any of our assets or liabilities.
SFAS No. 159 "The Fair Value Option for Financial Assets and Financial
Liabilities"
In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for Financial
Assets and Financial Liabilities." SFAS No. 159 permits entities to choose to measure many
financial instruments and certain other items at fair value and establishes presentation and
disclosure requirements designed to facilitate comparisons between entities that choose different
measurement attributes for similar types of assets and liabilities. SFAS No. 159 is effective for
IPALCO beginning in 2008, but early adoption is permitted. IPALCO has chosen not to early adopt and
management does not believe SFAS No. 159 will have a material impact on our results of operations or
financial position.
4. EQUIPMENT PURCHASE
On March 5, 2007, IPL filed a petition with the IURC for approval of, or a declination of
jurisdiction over, IPL's plans to acquire a combustion turbine owned by DTE Georgetown, LP, which is
a wholly owned subsidiary of DTE Georgetown Holdings, Inc. ("Holdings") and DTE Energy
Services Inc. ("Services"), pursuant to a purchase and sale agreement entered into with
Holdings and Services on February 22, 2007. The turbine has a nominal nameplate capacity of 80
megawatts and is located at IPL's Georgetown substation. The acquisition is contingent upon
receiving regulatory approvals.
5. SEGMENT INFORMATION
Operating segments are components of an enterprise for which separate financial information
is available and is evaluated regularly by the chief operating decision maker in assessing
performance and deciding how to allocate resources. Substantially all of our business consists of
the generation, transmission, distribution and sale of electric energy conducted through IPL.
IPALCO's reportable business segments are electric and "all other." The "all
other" category primarily includes the IPALCO$750 million Senior Secured Notes as of
March 31, 2007 and December 31, 2006, approximately $0.9 million and $0.9 million of nonutility cash
and cash equivalents, as of March 31, 2007 and December 31, 2006, respectively; long-term nonutility
investments of $9.0 million and $9.0 million at March 31, 2007 and December 31, 2006, respectively;
and income taxes and interest related to those items. There was no utility operating income other
than the activities of IPL during the periods covered by this report. Nonutility assets represented
less than 1% of IPALCO's total assets as of March 31, 2007 and December 31, 2006 and there were no
nonutility capital expenditures during the three month periods ended March 31, 2007 and March 31,
2006.
6. INCOME TAXES
IPALCO's effective combined state and federal income tax rates for the three month periods
ended March 31, 2007 and 2006 were 41.6% and 32.0%, respectively. The rate increase was primarily
the result of interest income related to income taxes recorded during the first quarter of 2006 as a
result of the completion of an IRS examination of our filings for the period 1996 through March of
2001.
AES files federal and state income tax returns which consolidate IPALCO and its
subsidiaries. Under a tax sharing agreement with AES, IPALCO is responsible for the income
taxes associated with its own taxable income. As a subsidiary of AES, IPALCO files income tax
returns in the U.S. federal jurisdiction and the state of Indiana. IPALCO is no longer subject
to U.S. or state income tax examinations for tax years prior to December 31, 2001.
As described in Note 3. "New Accounting Pronouncements", IPALCO adopted
the provisions of FIN No. 48, Accounting for Uncertainty in Income Taxes, on January
1, 2007. The implementation of FIN No. 48 resulted in primarily a reclassification of
Accumulated deferred tax liabilities to Non-current income taxes payable and no significant
cumulative impact to Accumulated Deficit. The gross unrecognized tax benefit balance as of the date
of adoption was $22.8 million. The balance of unrecognized tax benefits represents tax positions
for which the ultimate deductibility is highly certain but for which there is uncertainty about the
timing of such deductibility. Because of the impact of deferred tax accounting, other than interest
and penalties, the disallowance of the shorter deductibility period would not affect the annual
effective tax rate but would accelerate the payment of cash to the taxing authority to an earlier
period. It is expected that the amount of unrecognized tax benefits may change in the next twelve
months; however, management does not expect the change to have a significant impact on IPALCO's
financial statements.
Tax-related interest expense is reported as a part of the provision for federal and state income
taxes. Penalties, if incurred, would also be recognized as a component of tax expense.
As of January 1, 2007, IPALCO has recorded a liability of $3.3 million for the payments of interest
and a receivable of $0.7 million for a refund of interest. Included in the recorded interest
is a $1.9 million liability and a $0.7 million receivable anticipated to
be paid/received within 12 months of the reporting date. The liability/receivable for the
payment/receipt of interest did not materially change as of March 31, 2007.
7. PENSION AND OTHER POSTRETIREMENT BENEFITS
Employees' Retirement Plan: Approximately 90% of IPL's active employees are covered by
the Employees' Retirement Plan of Indianapolis Power & Light Company ("Defined Benefit
Pension Plan"); as well as, the Employees' Thrift Plan of Indianapolis Power & Light
Company ("Thrift Plan"). The Defined Benefit Pension Plan is a qualified defined
benefit plan, while the Thrift Plan is a qualified defined contribution plan. The remaining
10% of active employees are covered by the AES Retirement Savings Plan ("RSP Plan").
The RSP Plan is a qualified defined contribution plan containing a profit sharing component.
All non-union new hires are covered under the RSP Plan, while International Brotherhood of
Electrical Workers ("IBEW") physical bargaining unit union new hires are covered under the
Defined Benefit Pension Plan and Thrift Plan. As a result of ratifying a new four-year labor
agreement between the IBEW clerical-technical unit and IPL in March 2007, new hires in this
bargaining unit are no longer covered under the Defined Benefit Pension Plan but will receive an
annual lump sum company contribution into the Thrift Plan. The Defined Benefit Pension Plan is
noncontributory and is funded through a trust. Benefits are based on each individual employee's
pension band and years of service as opposed to their compensation. Pension bands are based
primarily on job duties and responsibilities.
Management does not currently expect any of the pension assets to revert back to IPL during
2007.
In addition, IPL will change its measurement date from November 30 to December 31 coinciding with
the plan year ending December 31, 2008.
Supplemental Retirement Plan: Additionally, a small group of former officers and their
surviving spouses are covered under a funded non-qualified supplemental pension plan.
Pension Funding: IPL's funding policy for the Defined Benefit Pension Plan and the
Supplemental Retirement Plan is to contribute annually no less than the minimum required by applicable
law, nor more than the maximum amount that can be deducted for federal income tax purposes, with
the plan to avoid the "at risk" status and to meet targeted funding levels necessary to qualify
under standards of the Pension Benefit Guaranty Corporation for exemption from certain
administrative requirements.
For funding purposes, the Defined Benefit Pension Plan will be exempt from any required funding
during 2007. At this time, IPL does not intend to make any contributions to the Defined Benefit
Pension Plan during 2007; however, management will continue to review possible funding scenarios
throughout 2007. The Supplemental Retirement Plan is not projected to have any contributions;
however, depending on the return on assets, contributions may be required in 2007. If funding is
required, the amount is not expected to be material.
The following table presents information relating to the Pension Plans combined:
被折叠的 条评论
为什么被折叠?
到【灌水乐园】发言
