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LEASES (Notes)

6 Months Ended

Jun. 30, 2019

Leases [Abstract]

Lessee, Operating Leases [Text Block]

LEASES

Adoption of ASC Topic 842: Leases - We adopted Topic 842 using the modified retrospective method and the optional transition method to record the adoption impact through a cumulative-effect adjustment to retained earnings as of January 1, 2019. Results for reporting periods beginning after January 1, 2019, are presented under Topic 842, while prior periods are not adjusted and continue to be reported under the accounting standards in effect for those periods.

Practical Expedients and Policies Elected - We applied the short-term policy election, which allows us to exclude from recognition leases with an initial term of 12 months or less. We elected the hindsight expedient, which allows us to use hindsight in assessing lease term; the package of practical expedients permitted under the guidance, which among other things, allows us to carry forward the historical lease classification; and the land easement expedient, which allows us to apply the guidance prospectively at adoption for land easements on existing agreements.

Adoption - Adoption of Topic 842 resulted in new operating lease assets and lease liabilities on our Consolidated Balance Sheet of $17.5 million and $17.4 million, respectively, as of January 1, 2019. The difference between the lease assets and lease liabilities was recorded as an adjustment to the beginning balance of retained earnings, which represents the cumulative impact of adopting the standard. Our accounting for finance leases did not change. Adoption of Topic 842 did not materially impact our Consolidated Financial Statements.

Leases - We lease certain buildings, warehouses, office space, land and equipment, including pipeline equipment, rail cars and information technology equipment. Our lease payments are generally straight-line and the exercise of lease renewal options, which vary in term, is at our sole discretion. We include renewal periods in a lease term if we are reasonably certain to exercise available renewal options. Our lease agreements do not include any residual value guarantees or material restrictive covenants.

Through ONEOK Leasing Company, L.L.C. and ONEOK Parking Company, L.L.C., we own an office building and a parking garage and lease excess space in these facilities to affiliates and others. Our consolidated lease income is not material.

The following table sets forth information about our supplemental cash flows:

		Six Months Ended
		June 30, 2019
		(Thousands of dollars)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows for operating leases		$	3,300
Financing cash flows for finance lease		$	860
Right-of-use assets obtained in exchange for operating lease liabilities (noncash)		$	3,041

The following table sets forth information about our lease assets and liabilities included in our Consolidated Balance Sheet for the period indicated:

Leases	Location in our Consolidated Balance Sheet		June 30, 2019
			(Thousands of dollars)
Assets
Operating leases	Other assets		$	17,406
Finance lease	Property, plant and equipment		28,286
Finance lease	Accumulated depreciation		(754		)
Total leased assets			$	44,938
Liabilities
Current
Operating leases	Other current liabilities		$	3,660
Finance lease	Finance lease liability		1,854
Noncurrent
Operating leases	Other deferred credits		13,964
Finance lease	Finance lease liability		25,294
Total lease liabilities			$	44,772

The following table sets forth information about our leases for the periods indicated:

		Three Months Ended June 30, 2019				Six Months Ended June 30, 2019			At June 30, 2019
	Location in our Consolidated Statement of Income	Lease Cost							Weighted-Average Remaining Lease Term		Weighted-Average Discount Rate (a)
		(Thousands of dollars)							(Years)
Operating leases	Operations and maintenance	$	1,921			$	3,651		9.8		4.58%
Finance lease									9.3		10.00%
Amortization of lease assets	Depreciation and amortization	283				566
Interest on lease liabilities	Interest expense	686				1,383
Total lease cost		$	2,890			$	5,600

(a) - Our weighted-average discount rates represent the rate implicit in the lease or our incremental borrowing rate for a term equal to the remaining term of the lease.

The following table sets forth the maturity of our lease liabilities as of June 30, 2019:

		Finance Lease				Operating Leases
		(Millions of dollars)
Remainder of 2019		$	2.2			$	4.3
2020		4.5				2.2
2021		4.5				1.9
2022		4.5				1.8
2023		4.5				1.8
2024 and beyond		21.6				10.1
Total lease payments		41.8				22.1
Less: Interest		14.7				4.5
Present value of lease liabilities		$	27.1			$	17.6

Our future lease payments presented under the previous accounting standard as of December 31, 2018, are not materially different than those presented above.

Lessee, Finance Leases [Text Block]

LEASES

Adoption of ASC Topic 842: Leases - We adopted Topic 842 using the modified retrospective method and the optional transition method to record the adoption impact through a cumulative-effect adjustment to retained earnings as of January 1, 2019. Results for reporting periods beginning after January 1, 2019, are presented under Topic 842, while prior periods are not adjusted and continue to be reported under the accounting standards in effect for those periods.

Practical Expedients and Policies Elected - We applied the short-term policy election, which allows us to exclude from recognition leases with an initial term of 12 months or less. We elected the hindsight expedient, which allows us to use hindsight in assessing lease term; the package of practical expedients permitted under the guidance, which among other things, allows us to carry forward the historical lease classification; and the land easement expedient, which allows us to apply the guidance prospectively at adoption for land easements on existing agreements.

Adoption - Adoption of Topic 842 resulted in new operating lease assets and lease liabilities on our Consolidated Balance Sheet of $17.5 million and $17.4 million, respectively, as of January 1, 2019. The difference between the lease assets and lease liabilities was recorded as an adjustment to the beginning balance of retained earnings, which represents the cumulative impact of adopting the standard. Our accounting for finance leases did not change. Adoption of Topic 842 did not materially impact our Consolidated Financial Statements.

Leases - We lease certain buildings, warehouses, office space, land and equipment, including pipeline equipment, rail cars and information technology equipment. Our lease payments are generally straight-line and the exercise of lease renewal options, which vary in term, is at our sole discretion. We include renewal periods in a lease term if we are reasonably certain to exercise available renewal options. Our lease agreements do not include any residual value guarantees or material restrictive covenants.

Through ONEOK Leasing Company, L.L.C. and ONEOK Parking Company, L.L.C., we own an office building and a parking garage and lease excess space in these facilities to affiliates and others. Our consolidated lease income is not material.

The following table sets forth information about our supplemental cash flows:

		Six Months Ended
		June 30, 2019
		(Thousands of dollars)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows for operating leases		$	3,300
Financing cash flows for finance lease		$	860
Right-of-use assets obtained in exchange for operating lease liabilities (noncash)		$	3,041

The following table sets forth information about our lease assets and liabilities included in our Consolidated Balance Sheet for the period indicated:

Leases	Location in our Consolidated Balance Sheet		June 30, 2019
			(Thousands of dollars)
Assets
Operating leases	Other assets		$	17,406
Finance lease	Property, plant and equipment		28,286
Finance lease	Accumulated depreciation		(754		)
Total leased assets			$	44,938
Liabilities
Current
Operating leases	Other current liabilities		$	3,660
Finance lease	Finance lease liability		1,854
Noncurrent
Operating leases	Other deferred credits		13,964
Finance lease	Finance lease liability		25,294
Total lease liabilities			$	44,772

The following table sets forth information about our leases for the periods indicated:

		Three Months Ended June 30, 2019				Six Months Ended June 30, 2019			At June 30, 2019
	Location in our Consolidated Statement of Income	Lease Cost							Weighted-Average Remaining Lease Term		Weighted-Average Discount Rate (a)
		(Thousands of dollars)							(Years)
Operating leases	Operations and maintenance	$	1,921			$	3,651		9.8		4.58%
Finance lease									9.3		10.00%
Amortization of lease assets	Depreciation and amortization	283				566
Interest on lease liabilities	Interest expense	686				1,383
Total lease cost		$	2,890			$	5,600

(a) - Our weighted-average discount rates represent the rate implicit in the lease or our incremental borrowing rate for a term equal to the remaining term of the lease.

The following table sets forth the maturity of our lease liabilities as of June 30, 2019:

		Finance Lease				Operating Leases
		(Millions of dollars)
Remainder of 2019		$	2.2			$	4.3
2020		4.5				2.2
2021		4.5				1.9
2022		4.5				1.8
2023		4.5				1.8
2024 and beyond		21.6				10.1
Total lease payments		41.8				22.1
Less: Interest		14.7				4.5
Present value of lease liabilities		$	27.1			$	17.6

Our future lease payments presented under the previous accounting standard as of December 31, 2018, are not materially different than those presented above.

X

- References

No definition available.

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- Definition

The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 20
-URI http://asc.fasb.org/subtopic&trid=77888251

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X

- Definition

The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 20
-URI http://asc.fasb.org/subtopic&trid=77888251

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