EFTA01366598.pdf

Amendment #4 Page 169 of 868 Plat d C91 1, I d trends in the power nckstry, fl amenco prowled by our power purchasers and informant(' available to management from other otter* sources as appropriate. These estmees are subject to an rtierert degree of uncertainty We use estimate', aSSumpt,OnS and judgments for certain items inCluang Ire *reboot)* Inn of property and equipment, income tax, revenue recognition and certain componeMs of cost of revenue These erdenales, assunptions and judgments are derived and calinually evaluated based on availade information, experience and various assumptions we believe to be reasonable wider the orcurnstances To tie extent these estimates are Maternity noorrect and reed to be revised our operating results may be metenally adversely affected Cur senile-ant accounting policies are sums/reel in Note 2. Summary of Sgnifcant As:coming Policies. to our predecessor audited combined fuvircial statements included elsewhere in this prospectus We identify cur most coinsI accotnting polices as tlx)Se the are the most pervasive aria important to the portrayal of Ott Inancel position and resulted operations, and that requre the most decult subjective and/or complex julginents by managemert regarding estimates about matters that are nherently uncertain Use of estimates In preparing our predecessor audited combned Ara rcul statements. we use estimates and assunphors that may affect reported amounts and dsclosures Estimates are used when accourting for depreciation, leases, denvatwes asset retirement obligators, accrued batiltes, and income taxes, among others These estimates and asiSurriptiOnS ere bared on current facts, ratorical experience and various other factors that we believe 10 be reasonable under the circumstances. the results of whch kern the Ws* for matey judgments abate the carryng values of assets and liabildies and the recording of revenue costs and expenses that are not readily apparent from other sources To Me extent there are !tetanal dfferenceS between the estimates and actual results ctf future results of operations woAd De affected Asset retirement obligations We operate under solar power services agreements with aorta customers Pet include a requirement for the removal of the soar energy SyStems afire end of the term of the agreement Asset retirement ololgal Ora are recognized at fat value in the period in which they are nutted and the carrying amount of the related long-lived asset is corresponding'y ncreased Over Me, the led ty is accreted to its expected fume value The corresponding asset captehred at notation is depreciated over the useful lie of tie solar energy, system Revenue recognition A significant majonty of our revenues are obtained through the sale of energy (based on megawatts) pursuant to terms of PPAs or other cortractual arrangements, which have a weighted average remaining life of 19 years ae ot March 31. 2015 NI PPM are acCotrited for as operating leases, have no nrnmurn lease payments and all of the rental income under these leases is recorded as noon* when the elecincity is cblivered Impairment oflong-Wed assets LOnglwed assets that are held and used are reviewed for wroairment whenever events or changes in circumstances indicate carrying values may rot be recoverable An impairment loss a recognized if tie total ?Mae estimated undiscounted cash flays expected from an 83101 are less than its carrying vatue M ignominy/It charge is measured as We difference between an asset's taming amount and far value with the difference recorceo in operating costs and expenses in tne statement of operations Fair values are determined by a variety ct valuaton methods. inducing appeartials sales paces of similar assets and present value techniques 161 http://cfdocs.btogo.com:27638/cf/drv7/pub/edgar/2015/07/20/0001193125-15-256461/d78... 7/20/2015 CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0058126 CONFIDENTIAL SDNY GM_00204310 EFTA01366598