Unamortized Debt issuance Costs
Unamortized debt issuance costs are amortized over the original term of the related bonds
and notes. The Company's utility subsidiaries have recorded unamortized debt issuance costs
in cases where the NHPUC has permitted, or is expected to permit, recovery of these costs
over future periods. The debt issuance costs are being amortized over the original lives of the
associated debt.
Contributions in Aid of Construction
Under construction contracts with real estate developers and others, the Company’s utility
subsidiaries may receive non-refundable grants or advances for the cost of installing new
water mains or other capital assets. These grants or advances are recorded as CIAC. The
Company’s utility subsidiaries also record to plant and CIAC the fair market value of developer
installed mains and any excess of fair market value over the cost of community water systems
purchased from developers. CIAC are amortized over the life of the related properties.
Paycheck Protection Program Loan
The Company accounts for its Paycheck Protection Program (PPP) loan in accordance with
the guidelines established by the Financial Accounting Standards Board (FASB) ASC 470,
“Debt”. The guidance requires the company to account for the proceeds from the PPP loan
as debt and apply interest considering the ten-month interest payment deferral allowed for
the loan. The loan and accrued interest may be forgivable after eight or twenty-four weeks if
the loan proceeds are used for eligible purposes. The Company has elected to report the PPP
loan as long-term debt until forgiveness is received or denied. No income will be recognized
from the extinguishment of the PPP debt (whether as a result of forgiveness or otherwise)
until the Company has been legally released as the primary obligor of the loan.
Revenue Recognition — Regulated Entities
Standard charges for water utility services to customers are recorded as revenue, based upon
meter readings and contract service, as services are provided. The majority of the Company’s
water revenues are based on rates approved by the NHPUC. Estimates of unbilled service
revenues are recorded in the period the services are provided. Provision is made in the
consolidated financial statements for estimated uncollectible accounts.
Revenue Recognition — Non-Regulated Entities
The Company derives its non-regulated revenues primarily from water management services
which include contract operations and maintenance, and water testing and billing services to
municipalities and small, privately owned community water systems. Revenue is measured
based on consideration specified in contracts with customers. The Company recognizes
revenue when it satisfies performance obligations under the terms of the contract which
generally occurs with the transfer of control of the services to the customer. Revenues from
unplanned additional work are based upon time and materials incurred in connection with
activities not specifically identified in the contract, or for which work levels exceed contracted
amounts.
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