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New Accounting Standards and Interpretations
9 Months Ended
Sep. 30, 2011
Accounting Changes and Error Corrections [Abstract] 
NEW ACCOUNTING STANDARDS AND INTERPRETATIONS
NEW ACCOUNTING STANDARDS AND INTERPRETATIONS
In May 2011, the FASB amended authoritative accounting guidance regarding fair value measurement. The amendment prohibits the application of block discounts for all fair value measurements, permits the fair value of certain financial instruments to be measured on the basis of the net risk exposure and allows the application of premiums or discounts to the extent consistent with the applicable unit of account. The amendment clarifies that the highest-and-best use and valuation-premise concepts are not relevant to financial instruments. Expanded disclosures are required under the amendment, including quantitative information about significant unobservable inputs used for Level 3 measurements, a qualitative discussion about the sensitivity of recurring Level 3 measurements to changes in unobservable inputs disclosed, a discussion of the Level 3 valuation processes, any transfers between Levels 1 and 2 and the classification of items whose fair value is not recorded but is disclosed in the notes. The amendment is effective for FirstEnergy in the first quarter of 2012. FirstEnergy does not expect this amendment to have a material effect on its financial statements.
In June 2011, the FASB issued new accounting guidance that revises the manner in which entities present comprehensive income in their financial statements. The new guidance requires entities to report components of comprehensive income in either a continuous statement of comprehensive income or two separate but consecutive statements. The new guidance does not change the items that must be reported in other comprehensive income and does not affect the calculation or reporting of earnings per share. The amendment is effective for FirstEnergy in the first quarter of 2012. This amendment will not have a material effect on FirstEnergy’s financial statements.
In September 2011, the FASB amended guidance regarding how entities test goodwill for impairment. Under the revised guidance, an entity is not required to calculate the fair value of a reporting unit unless the entity determines that it is more likely than not that its fair value is less than its carrying amount, including goodwill. The revised guidance is intended to reduce the cost and complexity of performing goodwill impairment tests and is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011, with early adoption permitted. FirstEnergy will adopt the new guidance for goodwill impairment tests performed after calendar year 2011 and does not expect that the adoption will have a significant impact on its financial statements.