GE 2014 Annual Report Download - page 112

92 GE 2014 FORM 10-K
MD&A OTHER ITEMS
OTHER ITEMS
NEW ACCOUNTING STANDARDS
In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09,
Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to
be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue
recognition guidance in GAAP when it becomes effective. The new standard is effective on January 1, 2017. Early application
is not permitted. The standard permits the use of either the retrospective or modified retrospective (cumulative effect) transition
method. We are evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related
disclosures. We have not yet selected a transition method nor have we determined the effect of the standard on our ongoing
financial reporting.
In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis. The ASU amends the
consolidation guidance for VIEs and general partners’ investments in limited partnerships and modifies the evaluation of
whether limited partnerships and similar legal entities are VIEs or voting interest entities. The ASU is effective for interim and
annual reporting periods beginning after December 15, 2015, with early adoption permitted. We are currently evaluating the
effect of the ASU on our consolidated financial statements and related disclosures.
ENVIRONMENTAL MATTERS
Our operations, like operations of other companies engaged in similar businesses, involve the use, disposal and cleanup of
substances regulated under environmental protection laws. We are involved in a number of remediation actions to clean up
hazardous wastes as required by federal and state laws. Such statutes require that responsible parties fund remediation
actions regardless of fault, legality of original disposal or ownership of a disposal site. Expenditures for site remediation actions
amounted to approximately $0.4 billion in each of the years 2014, 2013 and 2012. We presently expect that such remediation
actions will require average annual expenditures of about $0.4 billion in 2015 and $0.3 billion in 2016.
In 2006, we entered into a consent decree with the Environmental Protection Agency (EPA) to dredge PCB-containing
sediment from the upper Hudson River. The consent decree provided that the dredging would be performed in two phases.
Phase 1 was completed in May through November of 2009. Between Phase 1 and Phase 2 there was an intervening peer
review by an independent panel of national experts. The panel evaluated the performance of Phase 1 dredging operations with
respect to Phase 1 Engineering Performance Standards and recommended proposed changes to the standards. On
December 17, 2010, EPA issued its decision setting forth the final performance standards for Phase 2 of the Hudson River
dredging project, incorporating aspects of the recommendations from the independent peer review panel and from GE. In
December 2010, we agreed to perform Phase 2 of the project in accordance with the final performance standards set by EPA
and increased our reserve by $0.8 billion in the fourth quarter of 2010 to account for the probable and estimable costs of
completing Phase 2. In 2012, we completed the first year of Phase 2 dredging and commenced work on planned upgrades to
the Hudson River wastewater processing facility. Over the past four years we have dredged 2.2 million cubic yards from the
river and, based upon that result and our best professional engineering judgment, we believe that our current reserve
continues to reflect our probable and estimable costs for the remainder of Phase 2 of the dredging project.
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