| PARTNERS' EQUITY |
PARTNERS’ EQUITY
The following table summarizes changes to our partners’ equity (in thousands of dollars): | | | | | Balance as of January 1, 2016 | $ | 1,609,844 |
| Net income | 109,918 |
| Unit-based compensation expense | 4,352 |
| Other comprehensive loss | (38,117 | ) | Cash distributions to partners | (196,102 | ) | Balance as of June 30, 2016 | $ | 1,489,895 |
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Accumulated Other Comprehensive Income (Loss) The balance of and changes in the components included in AOCI were as follows: | | | | | | | | | | | | | | | | | | Foreign Currency Translation | | Cash Flow Hedges | | Pension and Other Postretirement Benefits | | Total | | (Thousands of Dollars) | Balance as of January 1, 2016 | $ | (60,826 | ) | | $ | (27,968 | ) | | $ | — |
| | $ | (88,794 | ) | Other comprehensive income (loss): | | | | | | | | Employee Transfer | — |
| | — |
| | 4,201 |
| | 4,201 |
| Deferred income tax adjustments | — |
| | — |
| | 2,414 |
| | 2,414 |
| Other comprehensive income (loss) before reclassification adjustments | 1,711 |
| | (50,178 | ) | | — |
| | (48,467 | ) | Net gain on pension costs reclassified into operating expense | — |
| | — |
| | (479 | ) | | (479 | ) | Net gain on pension costs reclassified into general and administrative expense | — |
| | — |
| | (166 | ) | | (166 | ) | Net loss on cash flow hedges reclassified into interest expense, net | — |
| | 4,380 |
| | — |
| | 4,380 |
| Other comprehensive income (loss) | 1,711 |
| | (45,798 | ) | | 5,970 |
| | (38,117 | ) | Balance as of June 30, 2016 | $ | (59,115 | ) | | $ | (73,766 | ) | | $ | 5,970 |
| | $ | (126,911 | ) |
Allocations of Net Income General Partner. Our partnership agreement, as amended, sets forth the calculation to be used to determine the amount and priority of cash distributions that the limited partner unitholders and the general partner will receive. The partnership agreement also contains provisions for the allocation of net income and loss to the unitholders and the general partner. For purposes of maintaining partner capital accounts, the partnership agreement specifies that items of income and loss shall be allocated among the partners in accordance with their respective percentage interests. Normal allocations according to percentage interests are made after giving effect to priority income allocations, if any, in an amount equal to incentive cash distributions allocated 100% to the general partner.
The following table details the calculation of net income applicable to the general partner: | | | | | | | | | | | | | | | | | | Three Months Ended June 30, | | Six Months Ended June 30, | | 2016 | | 2015 | | 2016 | | 2015 | | (Thousands of Dollars) | Net income applicable to general partner and limited partners’ interest | $ | 52,517 |
| | $ | 54,325 |
| | $ | 109,918 |
| | $ | 182,224 |
| Less general partner incentive distribution | 10,805 |
| | 10,805 |
| | 21,610 |
| | 21,610 |
| Net income after general partner incentive distribution | 41,712 |
| | 43,520 |
| | 88,308 |
| | 160,614 |
| General partner interest | 2 | % | | 2 | % | | 2 | % | | 2 | % | General partner allocation of net income after general partner incentive distribution | 834 |
| | 871 |
| | 1,766 |
| | 3,213 |
| General partner incentive distribution | 10,805 |
| | 10,805 |
| | 21,610 |
| | 21,610 |
| Net income applicable to general partner | $ | 11,639 |
| | $ | 11,676 |
| | $ | 23,376 |
| | $ | 24,823 |
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Cash Distributions The following table reflects the allocation of total cash distributions to the general and limited partners applicable to the period in which the distributions were earned: | | | | | | | | | | | | | | | | | | Three Months Ended June 30, | | Six Months Ended June 30, | | 2016 | | 2015 | | 2016 | | 2015 | | (Thousands of Dollars, Except Per Unit Data) | General partner interest | $ | 1,961 |
| | $ | 1,961 |
| | $ | 3,922 |
| | $ | 3,922 |
| General partner incentive distribution | 10,805 |
| | 10,805 |
| | 21,610 |
| | 21,610 |
| Total general partner distribution | 12,766 |
| | 12,766 |
| | 25,532 |
| | 25,532 |
| Limited partners’ distribution | 85,285 |
| | 85,285 |
| | 170,570 |
| | 170,570 |
| Total cash distributions | $ | 98,051 |
| | $ | 98,051 |
| | $ | 196,102 |
| | $ | 196,102 |
| | | | | | | | | Cash distributions per unit applicable to limited partners | $ | 1.095 |
| | $ | 1.095 |
| | $ | 2.190 |
| | $ | 2.190 |
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The following table summarizes information related to our quarterly cash distributions: | | | | | | | | | | | | | | Quarter Ended | | Cash Distributions Per Unit | | Total Cash Distributions | | Record Date | | Payment Date | | | | | (Thousands of Dollars) | | | | | June 30, 2016 (a) | | $ | 1.095 |
| | $ | 98,051 |
| | August 9, 2016 | | August 12, 2016 | March 31, 2016 | | $ | 1.095 |
| | $ | 98,051 |
| | May 9, 2016 | | May 13, 2016 | December 31, 2015 | | $ | 1.095 |
| | $ | 98,051 |
| | February 8, 2016 | | February 12, 2016 |
| | (a) | The distribution was announced on July 29, 2016. |
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