XML 66 R37.htm IDEA: XBRL DOCUMENT v3.5.0.2

Fair Value Measurements (Tables)

9 Months Ended

Jun. 30, 2016

Fair Value Disclosures [Abstract]

Valuation Techniques

The measurement of fair value results in classification into a hierarchy by the inputs used to determine the fair value as follows:

Level 1	—		Unadjusted quoted prices in active markets accessible by the reporting entity for identical assets or liabilities.  Active markets are those in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing.
Level 2	—		Pricing inputs other than quoted market prices included in Level 1 that are based on observable market data and that are directly or indirectly observable for substantially the full term of the asset or liability.  These include quoted market prices for similar assets or liabilities, quoted market prices for identical or similar assets in markets that are not active, adjusted quoted market prices, inputs from observable data such as interest rate and yield curves, volatilities and default rates observable at commonly quoted intervals, and inputs derived from observable market data by correlation or other means.
Level 3	—		Pricing inputs that are unobservable, or less observable, from objective sources.  Unobservable inputs are only to be used to the extent observable inputs are not available.  These inputs maintain the concept of an exit price from the perspective of a market participant and should reflect assumptions of other market participants.  An entity should consider all market participant assumptions that are available without unreasonable cost and effort.  These are given the lowest priority and are generally used in internally developed methodologies to generate management's best estimate of the fair value when no observable market data is available.

Unrealized Investments Gains (Losses)

TVA recorded unrealized gains and losses related to its trading securities held as of the end of each period as follows:

Unrealized Investment Gains (Losses)
				Three Months Ended June 30								Nine Months Ended June 30
Fund		Financial Statement Presentation		2016				2015				2016				2015
SERP		Other income (expense)		$	1			$	—			$	1			$	—
LTDCP		Other income (expense)		—				—				—				(1		)
NDT		Regulatory asset		12				(19		)		60				15
ART		Regulatory asset		2				(3		)		11				12

Fair Value Measurements

The following tables set forth by level, within the fair value hierarchy, TVA's financial assets and liabilities that were measured at fair value on a recurring basis as of June 30, 2016, and September 30, 2015. Financial assets and liabilities have been classified in their entirety based on the lowest level of input that is significant to the fair value measurement. TVA's assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the determination of the fair value of the assets and liabilities and their classification in the fair value hierarchy levels.

Fair Value Measurements At June 30, 2016
Assets	Quoted Prices in Active  Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
Investments
Equity securities	$	189			$	—			$	—			$	189
Debt securities
U.S. government corporations and agencies	83				33				—				116
Corporate debt securities	—				341				—				341
Residential mortgage-backed securities	—				13				—				13
Commercial mortgage-backed securities	—				7				—				7
Collateralized debt obligations	—				32				—				32
Institutional mutual funds	83				—				—				83
Forward debt securities contracts	—				14				—				14
Private partnerships measured at net asset value(1)	—				—				—				246
Commingled funds measured at net asset value(1)	—				—				—				1,084
Total investments	355				440				—				2,125
Currency swap(s) (2)	—				—				—				—
Commodity contract derivatives	—				12				—				12
Commodity derivatives under FTP(2)
Swap contracts	—				—				—				—
Total	$	355			$	452			$	—			$	2,137
Liabilities	Quoted Prices in Active Markets for Identical Liabilities (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
Currency swap(s) (2)	$	—			$	167			$	—			$	167
Interest rate swaps	—				1,912				—				1,912
Commodity contract derivatives	—				6				183				189
Commodity derivatives under FTP(2)
Swap contracts	—				11				—				11
Total	$	—			$	2,096			$	183			$	2,279

Notes

(1) Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets.

(2)  Due to the right of setoff and method of settlement, TVA elects to record commodity derivatives under the FTP based on its net commodity position with the counterparty or FCM. Deposits are made to TVA's margin cash accounts held with each FCM to offset any net liability positions in full for derivatives that are transacted with FCMs. TVA records currency swaps net of cash collateral received from or paid to the counterparty, to the extent such amount is not recorded in Accounts payable and accrued liabilities. See Note 12 — Offsetting of Derivative Assets and Liabilities.

Fair Value Measurements At September 30, 2015
Assets	Quoted Prices in Active  Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
Investments
Equity securities	$	166			$	—			$	—			$	166
Debt securities
U.S. government corporations and agencies	203				31				—				234
Corporate debt securities	—				225				—				225
Residential mortgage-backed securities	—				17				—				17
Commercial mortgage-backed securities	—				7				—				7
Collateralized debt obligations	—				29				—				29
Institutional mutual funds	91				—				—				91
Forward debt securities contracts	—				(59		)		—				(59		)
Private partnerships measured at net asset value(1)	—				—				—				240
Commingled funds measured at net asset value(1)	—				—				—				1,061
Total investments	460				250				—				2,011
Currency swap(s) (2)	—				25				—				25
Commodity contract derivatives	—				1				—				1
Commodity derivatives under FTP(2)
Swap contracts	—				—				—				—
Total	$	460			$	276			$	—			$	2,037
Liabilities	Quoted Prices in Active Markets for Identical Liabilities (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
Currency swap(s) (2)	$	—			$	47			$	—			$	47
Interest rate swaps	—				1,627				—				1,627
Commodity contract derivatives	—				—				98				98
Commodity derivatives under FTP(2)
Swap contracts	—				27				—				27
Total	$	—			$	1,701			$	98			$	1,799

Notes

(1) Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets.

(2)  Due to the right of setoff and method of settlement, TVA elects to record commodity derivatives under the FTP based on its net commodity position with the counterparty or FCM. Deposits are made to TVA's margin cash accounts held with each FCM to offset any net liability positions in full for derivatives that are transacted with FCMs. TVA records currency swaps net of cash collateral received from or paid to the counterparty, to the extent such amount is not recorded in Accounts payable and accrued liabilities. See Note 12 — Offsetting of Derivative Assets and Liabilities.

Fair Value Measurements Using Significant Unobservable Inputs

The following table presents a reconciliation of all commodity contract derivatives measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

Fair Value Measurements Using Significant Unobservable Inputs
	Commodity Contract Derivatives
	Three Months Ended June 30				Nine Months Ended June 30
Balance at beginning of period	$	(154	)		$	(85	)
Purchases	—				—
Issuances	—				—
Sales	—				—
Settlements	—				—
Net unrealized gains (losses) deferred as regulatory assets and liabilities	26				(43		)
Balance at June 30, 2015	$	(128	)		$	(128	)
Balance at beginning of period	$	(187	)		$	(98	)
Purchases	—				—
Issuances	—				—
Sales	—				—
Settlements	—				—
Net unrealized gains (losses) deferred as regulatory assets and liabilities	4				(85		)
Balance at June 30, 2016	$	(183	)		$	(183	)

Quantitative Information about Level 3 Fair Value Measurements

The following table presents quantitative information related to the significant unobservable inputs used in the measurement of fair value of TVA's assets and liabilities classified as Level 3 in the fair value hierarchy:

Quantitative Information about Level 3 Fair Value Measurements
	Fair Value at June 30  2016				Valuation Technique(s)		Unobservable Inputs		Range
Assets
Commodity contract derivatives	$	—			Pricing model		Coal supply and demand		0.4 - 0.7 billion tons/year
							Long-term market prices		$9.45 - $76.25/ton
Liabilities
Commodity contract derivatives	$	183			Pricing model		Coal supply and demand		0.4 - 0.7 billion tons/year
							Long-term market prices		$9.45 - $76.25/ton

Quantitative Information about Level 3 Fair Value Measurements
	Fair Value at September 30 2015				Valuation Technique(s)		Unobservable Inputs		Range
Assets
Commodity contract derivatives	$	—			Pricing model		Coal supply and demand		0.8 - 1.0 billion tons/year
							Long-term market prices		$10.64 - $103.41/ton
Liabilities
Commodity contract derivatives	$	98			Pricing model		Coal supply and demand		0.8 - 1.0 billion tons/year
							Long-term market prices		$10.64 - $103.41/ton

Estimated Values of Financial Instruments Not Recorded at Fair Value

The estimated fair values of TVA's financial instruments not recorded at fair value at June 30, 2016, and September 30, 2015, were as follows:

Estimated Values of Financial Instruments Not Recorded at Fair Value
			At June 30, 2016								At September 30, 2015
	Valuation Classification		Carrying Amount				Fair Value				Carrying Amount				Fair Value
EnergyRight® receivables (including current portion)	Level 2		$	143			$	147			$	156			$	162
Loans and other long-term receivables, net (including current portion)	Level 2		$	171			$	160			$	129			$	117
EnergyRight® financing obligation (including current portion)	Level 2		$	167			$	188			$	185			$	208
Unfunded loan commitments	Level 2		$	—			$	9			$	—			$	9
Membership interest of variable interest entity subject to mandatory redemption (including current portion)	Level 2		$	36			$	47			$	37			$	47
Long-term outstanding power bonds (including current maturities), net	Level 2		$	22,515			$	28,549			$	22,649			$	25,468
Long-term debt of variable interest entities (including current maturities), net	Level 2		$	1,251			$	1,484			$	1,266			$	1,407

X

- Definition

The tabular disclosure of the estimated values of financial instruments not recorded at fair value. This disclosure includes the class of financial instrument, valuation classification, carrying amount, and fair value.

+ References

No definition available.

+ Details

Name:	tve_EstimatedValuesOfFinancialInstrumentsNotRecordedAtFairValueTableTextBlock
Namespace Prefix:	tve_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the inputs and valuation techniques used to measure fair value, and a discussion of changes in valuation techniques and related inputs, if any, applied during the period to each separate class of assets, liabilities, and financial instruments classified in shareholders' equity that are measured on a recurring and/or nonrecurring basis.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (bbb)
-URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19207-110258

+ Details

Name:	us-gaap_FairValueAssetsAndLiabilitiesMeasuredOnRecurringAndNonrecurringBasisValuationTechniquesTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the inputs and valuation techniques used to measure fair value, and a discussion of changes in valuation techniques and related inputs, if any, used to measure similar assets in prior periods (non-recurring basis) by class of asset or liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (bbb)
-URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19207-110258

+ Details

Name:	us-gaap_FairValueAssetsMeasuredOnNonrecurringBasisValuationTechniquesTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19207-110258

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19279-110258

+ Details

Name:	us-gaap_FairValueAssetsMeasuredOnRecurringBasisUnobservableInputReconciliationTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- References

No definition available.

+ Details

Name:	us-gaap_FairValueDisclosuresAbstract
Namespace Prefix:	us-gaap_
Data Type:	xbrli:stringItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19190-110258

+ Details

Name:	us-gaap_ScheduleOfFairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of unrealized gains and losses on investments.

+ References

No definition available.

+ Details

Name:	us-gaap_UnrealizedGainLossOnInvestmentsTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration