Nature of Business

QEP Resources, Inc. (QEP or the Company) is a holding company with two subsidiaries, QEP Energy Company and QEP Marketing Company, which are engaged in two primary lines of business: (i) oil and gas exploration and production (QEP Energy) and (ii) oil and gas marketing, operation of the Haynesville Gathering System and an underground gas storage reservoir (QEP Marketing and Other).

QEP's operations are focused in two geographic regions: the Northern Region (primarily in Wyoming, North Dakota and Utah) and the Southern Region (primarily in Texas and Louisiana) of the United States. QEP's corporate headquarters are located in Denver, Colorado.

In October 2014, the Company announced that its wholly owned subsidiary, QEP Field Services Company (QEP Field Services), had entered into a definitive agreement to sell substantially all of its midstream business, including the Company's ownership interest in QEP Midstream Partners, LP (QEP Midstream), to Tesoro Logistics LP (Tesoro). On December 2, 2014, QEP closed the sale of its midstream business to Tesoro (Midstream Sale) for total cash proceeds of $2.5 billion, including $230.0 million to refinance debt at QEP Midstream, subject to post-closing adjustments, and QEP recorded a pre-tax gain of $1.8 billion on its Consolidated Statements of Operations in "Net income from discontinued operations, net of income tax" for the year ended December 31, 2014. The decision to sell the midstream business was the result of the Company’s ongoing review of strategic alternatives to maximize shareholder value. QEP Marketing retained ownership of the Haynesville Gathering System. As a result of the Midstream Sale, the QEP Field Services reporting segment, excluding the retained ownership of the Haynesville Gathering System, has been classified as a discontinued operation on the Consolidated Statement of Operations and the Notes accompanying the Consolidated Financial Statements. For reporting purposes, the Haynesville Gathering System, which was retained by QEP Marketing, has been combined with QEP Marketing and Other.

Shares of QEP’s common stock trade on the New York Stock Exchange under the ticker symbol “QEP”.

Principles of Consolidation

The Consolidated Financial Statements contain the accounts of QEP and its majority-owned or controlled subsidiaries. The Consolidated Financial Statements were prepared in accordance with GAAP and with the instructions for annual reports on Form 10-K and Regulations S-X and S-K. All significant intercompany accounts and transactions have been eliminated in consolidation.

All dollar and share amounts in this Annual Report on Form 10-K are in millions, except per-share information and where otherwise noted.

Reclassifications

The 2013 and 2012 financial information has been recast so that the basis of presentation is consistent with that of the 2014 financial information. This recast reflects the financial condition and results of operations of QEP Field Services, excluding the Haynesville Gathering System, as discontinued operations for all periods presented. For reporting purposes, the retained Haynesville Gathering System has been combined with QEP Marketing and Other. For a summary of discontinued operations see Note 3 - Discontinued Operations.

Use of Estimates

The preparation of the Consolidated Financial Statements and Notes in conformity with GAAP requires that management formulate estimates and assumptions that affect revenues, expenses, assets, liabilities and the disclosure of contingent assets and liabilities. A significant item that requires management's estimates and assumptions is the estimate of proved gas, oil and NGL reserves which are used in the calculation of depreciation, depletion and amortization rates of its oil and gas properties, impairment of proved properties and asset retirement obligations. Changes in estimated quantities of its reserves could impact the Company's reported financial results as well as disclosures regarding the quantities and value of proved oil and gas reserves. Other items subject to estimates and assumptions include the carrying amount of property, plant and equipment, assigning fair value and allocating purchase price in connection with business combinations, valuation allowances for receivables, income taxes, valuation of derivatives instruments, accrued liabilities, accrued revenue and related receivables and obligations related to employee benefits, among others. Although management believes these estimates are reasonable, actual results could differ from these estimates.

Risks and Uncertainties

The Company’s revenue, profitability and future growth are substantially dependent upon the prevailing and future prices for gas, oil and NGL, each of which depend on numerous factors beyond the Company’s control such as economic conditions, regulatory developments, global supply and demand and competition from other energy sources. The energy markets historically have been volatile and oil and gas prices at the end of 2014 and during the first part of 2015 have been substantially lower than recent historical averages, and may be subject to significant fluctuations in the future. The Company’s derivative contracts serve to mitigate a portion of the effect of this price volatility on the Company’s cash flows, and the Company has derivative contracts in place for a portion of its expected 2015 and 2016 oil and gas production. See Note 7 - Derivative Contracts for the Company’s open oil and gas commodity derivative contracts. The Company is dependent on cash on hand, availability under its credit facility, along with cash flows from operating activities, to fund its capital expenditures. Based on its current cash on hand, anticipated oil and gas prices and availability under its credit facility, the Company expects to be able to fund its planned capital expenditures and operating expenses for 2015. However, a substantial or extended decline in oil and gas prices could have an adverse effect on the Company’s financial position, results of operations, cash flows and quantities of oil and gas reserves that may be economically produced, and could impact the Company’s ability to comply with the financial covenants under the credit facility and could limit further borrowings to fund capital expenditures. Additionally, as forward prices have continued to decline during 2015, there could be additional impairment charges to our oil and gas assets or other investments.

Revenue Recognition

QEP subsidiaries recognize revenues in the period that services are provided or products are delivered. Revenues associated with the sale of oil, gas and NGL are accounted for using the sales method, whereby revenue is recognized as oil, gas and NGL is sold to purchasers. A liability is recorded in the event that the Company has sold volumes in excess of its share of remaining oil and gas reserves in an underlying property. QEP's imbalance obligations at December 31, 2014 and 2013, were $7.9 million and $10.7 million, respectively.

QEP Marketing reports revenues on a gross basis because, in the judgment of management, the nature and circumstances of its marketing transactions are consistent with guidance for gross revenue reporting. QEP Marketing markets affiliate and third-party gas, oil and NGL volumes. QEP Marketing uses derivatives to secure a known price for a specific volume over a specific time period. QEP Marketing does not engage in speculative hedging transactions, nor does it buy and sell energy contracts with the objective of generating profits on short-term differences in price. QEP Marketing has not engaged in buy/sell arrangements, as described in ASC 845-10-25-4, Accounting for Purchases and Sales of Inventory with the Same Counterparty.

In most states in which QEP Energy operates, QEP pays production taxes based on a percentage of field-level revenue, except in Louisiana, where severance taxes are volume based.

Cash and Cash Equivalents and Restricted Cash

Cash equivalents consist principally of highly liquid investments in securities with maturities of three months or less made through commercial-bank accounts that result in available funds the next business day.

As of December 31, 2014, none of QEP's cash and cash equivalents were restricted. As of December 31, 2013, QEP's restricted cash balance was $50.0 million, which consisted of a deposit paid by QEP that was held in escrow for an acquisition (see Note 2 - Acquisitions and Divestitures for further discussion on the acquisition). The cash payment is shown in investing activities on the Consolidated Statements of Cash Flows.

Supplemental cash flow information is shown in the below table:



	Year Ended December 31,
	2014		2013			2012
Supplemental Disclosures:	(in millions)
Cash paid for interest, net of capitalized interest	$	163.2	$	156.7		$	105.1
Cash paid for income taxes	0.3		77.9			30.0
Non-cash investing activities
Change in capital expenditure accrual balance	$	8.4	$	(25.2	)	$	88.5

Accounts Receivable Trade

Accounts receivable trade consists mainly of receivables from oil and gas purchasers and joint interest owners on properties the Company operates. For receivables from joint interest owners, the Company has the ability to withhold future revenue disbursements to recover any non-payment of joint interest billings. Generally, the Company's oil and gas receivables are collected and bad debts are minimal. Bad debt expense associated with accounts receivable for the years ended December 31, 2014, 2013 and 2012, was $2.1 million, $0.1 million, and $1.3 million, respectively. The Company routinely assesses the recoverability of all material trade and other receivables to determine their collectability. The allowance for bad debt expenses was $4.6 million at December 31, 2014 and $2.2 million at December 31, 2013.

Property, Plant and Equipment

Property, plant and equipment balances are stated at historical cost. Material and supplies inventories are valued at the lower of cost or market. Maintenance and repair costs are expensed as incurred. Significant accounting policies for our property, plant and equipment are as follows:

Oil and gas properties

The Company follows the successful efforts method of accounting for oil and gas property acquisitions, exploration, development and production activities. Under this method, the acquisition costs of proved and unproved properties, successful exploratory wells and development wells are capitalized. Other exploration costs, including geological and geophysical costs, delay rentals and administrative costs associated with unproved property and unsuccessful exploratory well costs are expensed. Costs to operate and maintain wells and field equipment are expensed as incurred. A gain or loss is generally recognized only when an entire field is sold or abandoned, or if the unit-of-production depreciation, depletion and amortization rate would be significantly affected.

Capitalized costs of unproved properties are reclassified to proved property when related proved reserves are determined or charged against the impairment allowance when abandoned.

Capitalized exploratory well costs

The Company capitalizes exploratory well costs until it determines whether an exploratory well is commercial or noncommercial. If the Company deems the well commercial, capitalized costs are depreciated on a field basis using the unit-of-production method and the estimated proved developed oil and gas reserves. If the Company concludes that the well is noncommercial, well costs are immediately charged to exploration expense. Exploratory well costs that have been capitalized for a period greater than one year since the completion of drilling are expensed unless the Company remains engaged in substantial activities to assess whether the well is commercial.

Depreciation, depletion and amortization

Capitalized proved leasehold costs are depleted on a field-by-field basis using the unit-of-production method and the estimated proved oil and gas reserves. Capitalized costs of exploratory wells that have found proved oil and gas reserves and capitalized development costs are depreciated using the unit-of-production method based on estimated proved developed reserves for a successful effort field. The Company capitalizes an estimate of the fair value of future abandonment costs.

Depreciation, depletion and amortization for the Company's remaining properties is generally based upon rates that will systematically charge the costs of assets against income over the estimated useful lives of those assets using the straight-line method. The estimated useful lives of those assets depreciated under the straight-line basis generally range as follows:



Buildings	10 to 30 years
Leasehold improvements	3 to 10 years
Service, transportation and field service equipment	3 to 7 years
Furniture and office equipment	3 to 7 years

Impairment of Long-Lived Assets

Proved oil and gas properties are evaluated on a field-by-field basis for potential impairment. Impairment is indicated when a triggering event occurs and/or the sum of the estimated undiscounted future net cash flows of an evaluated asset is less than the asset's carrying value. Triggering events could include, but are not limited to, an impairment of oil and gas reserves caused by mechanical problems, faster-than-expected decline of reserves, lease ownership issues, and other than temporary declines in gas, oil and NGL prices. If impairment is indicated, fair value is calculated using a discounted-cash flow approach. Cash flow estimates require forecasts and assumptions for many years into the future for a variety of factors, including commodity prices, operating costs, and estimates of proved, probable and possible reserves. Cash flow estimates relating to future cash flows from probable and possible reserves are reduced by additional risk-weighting factors.

Unproved properties are evaluated on a specific-asset basis or in groups of similar assets, as applicable. The Company performs periodic assessments of unproved oil and gas properties for impairment and recognizes a loss at the time of impairment. In determining whether an unproved property is impaired, the Company considers numerous factors including, but not limited to, current development and exploration drilling plans, favorable or unfavorable exploration activity on adjacent leaseholds, in-house geologists' evaluation of the lease, future reserve cash flows and the remaining lease term.

During the year ended December 31, 2014, QEP recorded impairment charges of $1,143.2 million, of which $1,041.4 million related to price-related impairment charges on proved properties and $101.8 million related to impairment on unproved properties due to lower future prices, lease expirations and changes in drilling plans. Of the $1,143.2 million property impairment charges incurred during the year ended December 31, 2014, $1,116.8 million related to oil and gas properties in the Southern Region and $26.4 million related to oil and gas properties in the Northern Region.

During the year ended December 31, 2013, QEP recorded impairment charges of $93.0 million, of which $1.2 million was related to price-related impairment charges on proved properties and $32.3 million was related to impairment on unproved properties due to lease expirations and changes in drilling plans. An additional $59.5 million of impairment was recorded due to the write-off of goodwill (see Goodwill section within this note for additional information). Of the $33.5 million of property impairment charges incurred during the year ended December 31, 2013, $17.5 million related to oil and gas properties in the Southern Region and $16.0 million related to oil and gas properties in the Northern Region.

During the year ended December 31, 2012, QEP recorded impairment charges of $133.0 million on its oil and gas properties. Of the $133.0 million charges during the year ended December 31, 2012, $107.6 million related to price-related impairment charges on proved properties and $25.4 million related to impairment on unproved properties. The impairment charges reflect the reduced value of certain fields resulting from lower gas, oil and NGL prices and impairments of unproven leasehold acquisition costs. Of the $133.0 million impairment charges during the year ended December 31, 2012, $104.7 million related to oil and gas properties in the Southern Region and $28.3 million related to oil and gas properties in the Northern Region.

Asset Retirement Obligations

QEP is obligated to fund the costs of disposing of long-lived assets upon their abandonment. The majority of QEP's asset retirement obligations (ARO) relate to the plugging of wells and the related abandonment of oil and gas properties. ARO associated with the retirement of tangible long-lived assets are recognized as liabilities with an increase to the carrying amounts of the related long-lived assets in the period incurred. The cost of the tangible asset, including the asset retirement costs, is depreciated over the useful life of the asset. ARO are recorded at estimated fair value, measured by reference to the expected future cash outflows required to satisfy the retirement obligations discounted at the Company's credit-adjusted risk-free interest rate. Accretion expense is recognized over time as the discounted liabilities are accreted to their expected settlement value. If estimated future costs of ARO change, an adjustment is recorded to both the asset retirement obligation and the long-lived asset. Revisions to estimated ARO can result from changes in retirement cost estimates, revisions to estimated inflation rates and changes in the estimated timing of abandonment.

Litigation and Other Contingencies

In accordance with ASC 450, Contingencies, an accrual is recorded for a loss contingency when its occurrence is probable and damages can be reasonably estimated based on the anticipated most likely outcome or the minimum amount within a range of possible outcomes. QEP regularly reviews contingencies to determine the adequacy of its accruals and related disclosures. The amount of ultimate loss may differ from these estimates. See Note 10 - Commitments and Contingencies, for additional information.

Except for environmental contingencies acquired in a business combination, which are recorded at fair value, QEP accrues losses associated with environmental obligations when such losses are probable and can be reasonably estimated. Accruals for estimated environmental losses are recognized no later than at the time the remediation feasibility study, or the evaluation of response options, is complete. These accruals are adjusted as additional information becomes available or as circumstances change. Future environmental expenditures are not discounted to their present value. Recoveries of environmental costs from other parties are recorded separately as assets at their undiscounted value when receipt of such recoveries is probable.

Goodwill

Goodwill represents the excess of the amount paid over the fair value of net assets acquired in a business combination and is not subject to amortization. As of December 31, 2013, goodwill related to the Company's Uinta Basin reporting unit within QEP Energy was reduced to zero from $59.5 million in 2012 due to the recognition of impairment during 2013. Goodwill was tested for impairment under a two-step quantitative test on an annual basis or when a triggering event occurred. Under the first step, the estimated fair value of the reporting unit was compared with its carrying value (including goodwill). QEP determined fair value of its reporting units in which goodwill was allocated using the income approach in which the fair value was estimated based on the value of expected future cash flows. Key assumptions used in the cash flow model considered estimated quantities of oil, NGL and gas reserves, including both proved reserves and risk-adjusted unproved reserves, including probable and possible reserves; estimates of market prices considering forward commodity price curves as of the measurement date; and estimates of capital costs. If the fair value of the reporting unit exceeded its carrying value, step two did not need to be performed. If the estimated fair value of the reporting unit was less than its carrying value, an indication of goodwill impairment existed for the reporting unit and the enterprise performed step two of the impairment test (measurement). Under step two, an impairment loss was recognized for any excess of the carrying amount of the reporting unit’s goodwill over the implied fair value of that goodwill. The implied fair value of goodwill was determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation in acquisition accounting. The residual fair value after this allocation was the implied fair value of the reporting unit goodwill. Fair value of the reporting unit under the two-step assessment was determined using a discounted cash flow analysis.

During the performance of QEP's annual goodwill impairment test at December 31, 2013, QEP failed the first step of the goodwill impairment test as described above. This was due primarily to lower forecasted oil and NGL prices. QEP performed the second step test described above resulting in a full write down of the Uinta reporting unit's goodwill of $59.5 million as of December 31, 2013.

Derivative Instruments

Effective January 1, 2012, the Company elected to de-designate all of its gas, oil and NGL derivative contracts that were previously designated as cash flow hedges and the Company elected to discontinue hedge accounting prospectively. Accordingly, all realized and unrealized gains and losses are recognized in earnings immediately as derivative contracts are settled and marked-to-market. For the years ended December 31, 2014, 2013 and 2012, an unrealized gain of $374.4 million, an unrealized loss of $88.7 million and an unrealized gain of $63.2 million, respectively, were included in income that, prior to January 1, 2012, would have been deferred in Accumulated Other Comprehensive Income (AOCI) under hedge accounting (Refer to Note 7 - Derivative Contracts, for additional information). At December 31, 2011, AOCI consisted of $395.9 million ($248.6 million after tax) of unrealized gains, representing the mark-to-market value of the Company's cash flow hedges as of the balance sheet date, less any ineffectiveness recognized. QEP fully reclassified all unrealized gains in AOCI into earnings during 2012 and 2013.

All of QEP's derivative contracts are net settled in cash without delivery of product. These contracts also have a nominal quantity, exchange an index price for a fixed price, and are net settled with the brokers as the price bulletins become available. These derivative contracts are recorded in revenues or cost of sales in the month of settlement. Basis-only swaps are used to manage the risk of widening basis differentials. These contracts are marked-to-market monthly with any change in the valuation recognized in the determination of income.

Credit Risk

Exposure to credit risk may be affected by the concentration of customers in these regions due to changes in economic or other conditions. Customers include individuals and numerous commercial and industrial enterprises that may react differently to changing conditions. Management believes that its credit review procedures, loss reserves, customer deposits and collection procedures have adequately provided for usual and customary credit-related losses. Commodity-based hedging arrangements also expose the Company to credit risk. The Company monitors the creditworthiness of its counterparties, which generally are major financial institutions and energy companies. Loss reserves are periodically reviewed for adequacy and may be established on a specific case basis. QEP requests credit support and, in some cases, fungible collateral, financial guarantees, letters of credit or prepayment from companies with unacceptable credit risks. The Company has master-netting agreements with some counterparties that allow the offsetting of receivables and payables in a default situation.

The Company's five largest customers accounted for 33%, 38%, and 27% of QEP's revenues for the years ended December 31, 2014, 2013 and 2012, respectively. During the year ended December 31, 2014, Valero Marketing and Supply Company made up 10% of the Company's total revenues. During the year ended December 31, 2013, Freepoint Commodities, LLC and Arrow Midstream Holdings, LLC accounted for 13% and 11%, respectively, of the Company's total revenues. During the year ended December 31, 2012, no customer accounted for 10% or more of QEP's total revenues. All of the these customers represent QEP Energy's customers and management believes that the loss of any of these customers, or any other customer, would not have a material effect on the financial position or results of operations of QEP, since there are numerous potential purchasers of its production.

Income Taxes

Deferred income taxes are provided for the temporary differences arising between the book and tax carrying amounts of assets and liabilities. These differences create taxable or tax-deductible amounts for future periods. The Company records interest earned on income tax refunds in interest and other income and records penalties and interest charged on tax deficiencies in interest expense.

ASC 740, Income Taxes, specifies the accounting for uncertainty in income taxes by prescribing a minimum recognition threshold for a tax position to be reflected in the financial statements. If recognized, the tax benefit is measured as the largest amount of tax benefit that is more-likely-than-not to be realized upon ultimate settlement. Management has considered the amounts and the probabilities of the outcomes that could be realized upon ultimate settlement and believes that it is more-likely-than-not that the Company's recorded income tax benefits will be fully realized. During the year ended December 31, 2014, the Company recorded a valuation allowance of $18.4 million against the state net operation loss deferred tax asset, because the sale of properties in Oklahoma in 2014 will preclude its utilization in the future. There were no unrecognized tax benefits at the beginning or end of the twelve-month periods ended December 31, 2013 and 2012. All federal income tax returns prior to 2014 have been examined by the Internal Revenue Service and are closed. Income tax returns for 2014 have not yet been filed. Most state tax returns for 2011 and subsequent years remain subject to examination.

Treasury Stock

We record treasury stock purchases at cost, which includes incremental direct transaction costs. Amounts are recorded as a reduction in shareholders' equity in the consolidated balance sheets. QEP acquires treasury stock from stock forfeitures and withholdings and uses the acquired treasury stock for option exercises and certain stock grants to employees; refer to Note 11 - Equity-Based Compensation for additional information.

Share Repurchases and Retirements

In January 2014, QEP's Board of Directors authorized the repurchase of up to $500.0 million of the Company's outstanding shares of common stock. This program was extended through December 2015. The timing and amount of any QEP share repurchases will depend upon a number of factors, including general market conditions, the Company’s financial position and the estimated intrinsic value of the Company’s shares. The repurchase plan does not obligate QEP to acquire any specific number of shares and may be discontinued at any time. Shares repurchased under the plan represent common stock and are retired after repurchase. During December 2014, QEP repurchased 4,731,438 shares at a weighted average price of $21.08 per share, including commission of $0.02 per share, for $99.7 million under this program.

Earnings Per Share

Basic earnings per share (EPS) are computed by dividing net income attributable to QEP by the weighted-average number of common shares outstanding during the reporting period. Diluted EPS includes the potential increase in the number of outstanding shares that could result from the exercise of in-the-money stock options. QEP's unvested restricted shares are considered issued and outstanding, have a minimal historical forfeiture rate and receive dividends.

Unvested equity-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are considered participating securities and are included in the computation of earnings per share pursuant to the two-class method. The Company's unvested restricted stock awards contain non-forfeitable dividend rights and participate equally with common stock with respect to dividends issued or declared. However, the Company's unvested restricted stock does not have a contractual obligation to share in losses of the Company. The Company's unexercised stock options do not contain rights to dividends. Under the two-class method, the earnings used to determine basic earnings per common share are reduced by an amount allocated to participating securities. When the Company records a net loss, none of the loss is allocated to the participating securities since the securities are not obligated to share in Company losses. Use of the two-class method has an insignificant impact on the calculation of basic and diluted earnings per common share. For the twelve months ended December 31, 2014, 0.3 million shares were not included in diluted common shares outstanding as they were anti-dilutive due to QEP's net loss from continuing operations. A reconciliation of the components of basic and diluted shares used in the EPS calculation follows:



	December 31,
	2014	2013	2012
	(in millions)
Weighted-average basic common shares outstanding	179.8	179.2	177.8
Potential number of shares issuable under the Long-Term Stock Incentive Plan	—	0.3	0.9
Average diluted common shares outstanding	179.8	179.5	178.7

Equity-Based Compensation

QEP issues stock options and restricted shares to certain officers, employees and non-employee directors under its Long-Term Stock Incentive Plan (LTSIP). QEP uses the Black-Scholes-Merton mathematical model to estimate the fair value of stock options for accounting purposes. The granting of restricted shares results in recognition of compensation cost measured at the grant-date market price. QEP uses an accelerated method in recognizing equity-based compensation costs with graded-vesting periods. Stock options held by employees generally vest in three equal, annual installments and primarily have a term of seven years. Restricted shares vest in equal installments over a specified number of years after the grant date with the majority vesting in three years. Non-vested restricted shares have voting and dividend rights; however, sale or transfer is restricted. The Company also awards performance share units under its Cash Incentive Plan (CIP), which are paid out in cash depending upon the Company's total shareholder return compared to a group of its peers over a three-year period. The performance share unit's compensation cost is equal to its fair value as of the period end and is classified as a liability. For a summary of LTSIP and CIP transactions see Note 11 - Equity-Based Compensation.

Pension Plans, Other Postretirement Benefits and Defined-Contribution Plans

QEP measures pension plan assets at fair value. Defined-benefit plan obligations and costs are actuarially determined, incorporating the use of various assumptions. Critical assumptions for pension and other postretirement plans include the discount rate, the expected rate of return on plan assets (for funded pension plans) and the rate of future compensation increases. Other assumptions involve demographic factors such as retirement, mortality and turnover. QEP evaluates and updates its actuarial assumptions at least annually.

Comprehensive Income

Comprehensive income is the sum of net income as reported in the Consolidated Statements of Operations and changes in the components of other comprehensive income. Other comprehensive income includes certain items that are recorded directly to equity and classified as AOCI. One component of other comprehensive income is changes in the market value of commodity-based derivative instruments for which the Company previously applied hedge accounting. Income or loss associated with such commodity-based derivative instruments was realized when the gas, oil or NGL underlying the derivative instrument was sold. Comprehensive income includes changes in the under-funded portion of the Company's defined benefit pension plans and other postretirement benefits plans and changes in deferred income taxes on such amounts. These transactions do not represent the culmination of the earnings process but result from periodically adjusting historical balances to fair value.

Business Segments

Line of business information is presented according to senior management's basis for evaluating performance considering differences in the nature of products, services and regulation. QEP's lines of business are QEP Energy and QEP Marketing and Other. QEP's former reporting segment, QEP Field Services, excluding the retained ownership of the Haynesville Gathering System, was sold in 2014 and has been classified as a discontinued operation on the Consolidated Statement of Operations and the Notes accompanying the Consolidated Financial Statements. The Haynesville Gathering System, which was retained by QEP Marketing, is included the reporting segment QEP Marketing and Other.

Recent Accounting Developments

In August 2014, the Financial Accounting Standards Board (FASB) issued ASU No. 2014-15, Presentation of Financial Statements-Going Concern (Topic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This guidance provides additional information to guide management's evaluation of whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. The update is effective for annual periods beginning on or after December 15, 2016. The Company is currently evaluating the impact of this standard on the Company's Consolidated Financial Statements.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), which seeks to provide a single, comprehensive revenue recognition model for all contracts with customers to improve comparability within industries, across industries, and across capital markets. The revenue standard contains principles that an entity will apply to determine the measurement of revenue and timing of when it is recognized. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The amendments are effective prospectively for reporting periods beginning after December 15, 2016 and early adoption is not permitted. The Company is currently assessing the impact on the Company's Consolidated Financial Statements.

In April 2014, the FASB issued Accounting Standards Update (ASU) 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, which broadened the reporting of discontinued operations to a component of an entity that has operations and cash flows that can be clearly distinguished from the rest of the entity. Under this guidance, to be a discontinued operation, a component or group of components must represent a strategic shift that has (or will have) a major effect on an entity's operations and financial results. The amendments are effective prospectively for reporting periods beginning on or after December 15, 2014 and early adoption is permitted. The Company chose to early adopt ASU 2014-08 and implemented the amendments during the quarter ended September 30, 2014.