MANAGEMENT’S DISCUSSION AND ANALYSIS
ACCOUNTING POLICY CHANGES New and amended standards, issued by the International Accounting Standards Board (IASB), became effective April 1, 2017. The impact of the adoption of these standards has been discussed in Note 3 of the Corporation’s consolidated financial statements. The IASB has issued several new and amended standards that will become effective in future periods. Details on future changes in accounting policies are provided within Note 3 of the consolidated financial statements.
Estimated Unearned Customer Capital Contributions Customer capital contributions, related to the construction of new, customer-specific service connections, are recognized as deferred revenue until the related property, plant and equipment are available for use. The Corporation’s customer capital contributions, particularly those related to the transmission system, are often subject to refunds over a certain period. Consequently, when the related property, plant and equipment are available for use, an estimate of the potential refund remains in deferred revenue until the refund period has passed. At March 31, 2018, the Corporation estimated $35 million in customer capital contributions related to either facilities not yet available for use, or amounts subject to refund in future periods.
Estimated Future Costs of Decommissioning Liabilities
The Corporation determines its obligations, legal and constructive, for the future costs of decommissioning certain natural gas facilities by estimating both the associated costs and timing of the necessary cash flows. The timing of future decommissioning is conditional upon the Corporation’s anticipated ongoing use for these facilities, while future decommissioning costs are estimated based on the Corporation’s experience and presented on a discounted basis. At March 31, 2018, the Corporation’s provisions were estimated at $128 million. A one per cent increase in the discount rates used to determine the provisions would have resulted in a $31 million decrease in provisions at the end of March 31, 2018. A one per cent decrease would have resulted in a $47 million increase.
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