Fair Value Measurements and Credit Concentration

9 Months Ended

Sep. 30, 2014

Fair Value Measurements and Credit Concentration [Abstract]

Fair Value Measurements and Credit Concentration

13. Fair Value Measurements and Credit Concentration

(All Registrants)

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). A market approach (generally, data from market transactions), an income approach (generally, present value techniques and option-pricing models), and/or a cost approach (generally, replacement cost) are used to measure the fair value of an asset or liability, as appropriate. These valuation approaches incorporate inputs such as observable, independent market data and/or unobservable data that management believes are predicated on the assumptions market participants would use to price an asset or liability. These inputs may incorporate, as applicable, certain risks such as nonperformance risk, which includes credit risk. The fair value of a group of financial assets and liabilities is measured on a net basis. Transfers between levels are recognized at end-of-reporting-period values. During the three and nine months ended September 30, 2014 and 2013, there were no transfers between Level 1 and Level 2. See Note 1 in each Registrant's 2013 Form 10-K for information on the levels in the fair value hierarchy.

Recurring Fair Value Measurements

The assets and liabilities measured at fair value were:

				September 30, 2014								December 31, 2013
				Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
PPL
Assets
	Cash and cash equivalents			$	1,188	$	1,188					$	1,102	$	1,102
	Restricted cash and cash equivalents (a)				324		324						134		134
	Price risk management assets:
		Energy commodities			1,041		4	$	945	$	92		1,188		3	$	1,123	$	62
		Interest rate swaps			6				6				91				91
		Foreign currency contracts			51				51
	Total price risk management assets				1,098		4		1,002		92		1,279		3		1,214		62
	NDT funds:
		Cash and cash equivalents			17		17						14		14
		Equity securities
			U.S. large-cap		582		432		150				547		409		138
			U.S. mid/small-cap		83		35		48				81		33		48
		Debt securities
			U.S. Treasury		98		98						95		95
			U.S. government sponsored agency		6				6				6				6
			Municipality		77				77				77				77
			Investment-grade corporate		40				40				38				38
			Other		6				6				5				5
		Receivables (payables), net			2				2				1		(1)		2
	Total NDT funds				911		582		329				864		550		314
	Auction rate securities (b)				13						13		19						19
Total assets				$	3,534	$	2,098	$	1,331	$	105	$	3,398	$	1,789	$	1,528	$	81

Liabilities
	Price risk management liabilities:
		Energy commodities		$	1,137	$	2	$	1,063	$	72	$	1,070	$	4	$	1,028	$	38
		Interest rate swaps			64				64				36				36
		Foreign currency contracts			26				26				106				106
		Cross-currency swaps			47				47				32				32
	Total price risk management liabilities			$	1,274	$	2	$	1,200	$	72	$	1,244	$	4	$	1,202	$	38

PPL Energy Supply
Assets
	Cash and cash equivalents			$	194	$	194					$	239	$	239
	Restricted cash and cash equivalents (a)				284		284						85		85
	Price risk management assets:
		Energy commodities			1,041		4	$	945	$	92		1,188		3	$	1,123	$	62
	Total price risk management assets				1,041		4		945		92		1,188		3		1,123		62
	NDT funds:
		Cash and cash equivalents			17		17						14		14
		Equity securities
			U.S. large-cap		582		432		150				547		409		138
			U.S. mid/small-cap		83		35		48				81		33		48
		Debt securities
			U.S. Treasury		98		98						95		95
			U.S. government sponsored agency		6				6				6				6
			Municipality		77				77				77				77
			Investment-grade corporate		40				40				38				38
			Other		6				6				5				5
		Receivables (payables), net			2				2				1		(1)		2
	Total NDT funds				911		582		329				864		550		314
	Auction rate securities (b)				10						10		16						16
Total assets				$	2,440	$	1,064	$	1,274	$	102	$	2,392	$	877	$	1,437	$	78

Liabilities
	Price risk management liabilities:
		Energy commodities		$	1,137	$	2	$	1,063	$	72	$	1,070	$	4	$	1,028	$	38
	Total price risk management liabilities			$	1,137	$	2	$	1,063	$	72	$	1,070	$	4	$	1,028	$	38

PPL Electric
Assets
	Cash and cash equivalents			$	111	$	111					$	25	$	25
	Restricted cash and cash equivalents (c)				3		3						12		12
Total assets				$	114	$	114					$	37	$	37

LKE
Assets
	Cash and cash equivalents			$	47	$	47			$	35	$	35
	Price risk management assets:
			Interest rate swaps		6			$	6
	Cash collateral posted to counterparties (d)				20		20				22		22
Total assets				$	73	$	67	$	6	$	57	$	57

Liabilities
	Price risk management liabilities:
		Interest rate swaps		$	46			$	46	$	36			$	36
Total price risk management liabilities				$	46			$	46	$	36			$	36

LG&E
Assets
	Cash and cash equivalents			$	25	$	25			$	8	$	8
	Price risk management assets:
			Interest rate swaps		3			$	3
	Cash collateral posted to counterparties (d)				20		20				22		22
Total assets				$	48	$	45	$	3	$	30	$	30

Liabilities
	Price risk management liabilities:
		Interest rate swaps		$	44			$	44	$	36			$	36
Total price risk management liabilities				$	44			$	44	$	36			$	36

KU
Assets
	Cash and cash equivalents			$	22	$	22			$	21	$	21
	Price risk management assets:
			Interest rate swaps		3			$	3
Total assets				$	25	$	22	$	3	$	21	$	21

Liabilities
	Price risk management liabilities:
		Interest rate swaps		$	2			$	2
Total price risk management liabilities				$	2			$	2

(a) Current portion is included in "Restricted cash and cash equivalents" and long-term portion is included in "Other noncurrent assets" on the Balance Sheets.

(b) Included in "Other investments" on the Balance Sheets.

(c) Current portion is included in "Other current assets" and long-term portion is included in "Other noncurrent assets" on the Balance Sheets.

(d) Included in "Other noncurrent assets" on the Balance Sheets. Represents cash collateral posted to offset the exposure with counterparties related to certain interest rate swaps under master netting arrangements that are not offset.

A reconciliation of net assets and liabilities classified as Level 3 for the periods ended September 30, 2014 is as follows:

					Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
					Three Months							Nine Months
					Energy		Auction		Cross-			Energy		Auction		Cross-
					Commodities,		Rate		Currency			Commodities,		Rate		Currency
					net		Securities		Swaps	Total		net		Securities		Swaps		Total
PPL
Balance at beginning of
	period				$	74	$	16		$	90	$	24	$	19			$	43
		Total realized/unrealized
			gains (losses)
				Included in earnings		(84)					(84)		(147)						(147)
				Included in OCI (a)												$	(1)		(1)
		Purchases											(6)						(6)
		Sales				67		(3)			64		67		(6)				61
		Settlements				(37)					(37)		82						82
		Transfers out of Level 3															1		1
Balance at end of period					$	20	$	13		$	33	$	20	$	13	$		$	33

PPL Energy Supply
Balance at beginning of
	period				$	74	$	13		$	87	$	24	$	16			$	40
		Total realized/unrealized
			gains (losses)
				Included in earnings		(84)					(84)		(147)						(147)
		Purchases											(6)						(6)
		Sales				67		(3)			64		67		(6)				61
		Settlements				(37)					(37)		82						82
Balance at end of period					$	20	$	10		$	30	$	20	$	10			$	30

(a) "Energy Commodities, net" and "Cross-Currency Swaps" are included in "Qualifying derivatives" and "Auction Rate Securities" are included in "Available-for-sale securities" on the Statements of Comprehensive Income.

A reconciliation of net assets and liabilities classified as Level 3 for the periods ended September 30, 2013 is as follows:

					Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
					Three Months								Nine Months
					Energy		Auction		Cross-				Energy		Auction		Cross-
					Commodities,		Rate		Currency				Commodities,		Rate		Currency
					net		Securities		Swaps		Total		net		Securities		Swaps		Total
PPL
Balance at beginning of
	period				$	40	$	19	$	3	$	62	$	22	$	16	$	1	$	39
		Total realized/unrealized
			gains (losses)
				Included in earnings		18						18		23						23
				Included in OCI (a)						(2)		(2)						1		1
		Sales												(2)						(2)
		Settlements				(2)						(2)		1						1
		Transfers into Level 3				(7)						(7)		1		3		3		7
		Transfers out of Level 3				(2)				(1)		(3)		2				(5)		(3)
Balance at end of period					$	47	$	19	$		$	66	$	47	$	19	$		$	66

PPL Energy Supply
Balance at beginning of
	period				$	40	$	16			$	56	$	22	$	13			$	35
		Total realized/unrealized
			gains (losses)
				Included in earnings		18						18		23						23
		Sales												(2)						(2)
		Settlements				(2)						(2)		1						1
		Transfers into Level 3				(7)						(7)		1		3				4
		Transfers out of Level 3				(2)						(2)		2						2
Balance at end of period					$	47	$	16			$	63	$	47	$	16			$	63

The significant unobservable inputs used in and quantitative information about the fair value measurement of assets and liabilities classified as Level 3 are as follows:

September 30, 2014

Fair Value, net

Range

Asset

Valuation

Unobservable

(Weighted

(Liability)

Technique

Input(s)

Average) (a)

PPL

Energy commodities

Natural gas contracts (b)

Discounted cash flow

Proprietary model used to calculate forward prices

17% - 100% (36%)

Power sales contracts (c)

(31)

Discounted cash flow

Proprietary model used to calculate forward prices

17% - 100% (68%)

FTR purchase contracts (d)

Discounted cash flow

Historical settled prices used to model forward prices

100% (100%)

Heat rate options (e)

Discounted cash flow

Proprietary model used to calculate forward prices

24% - 52% (45%)

Auction rate securities (f)

Discounted cash flow

Modeled from SIFMA Index

53% - 74% (64%)

PPL Energy Supply

Energy commodities

Natural gas contracts (b)

Discounted cash flow

Proprietary model used to calculate forward prices

17% - 100% (36%)

Power sales contracts (c)

(31)

Discounted cash flow

Proprietary model used to calculate forward prices

17% - 100% (68%)

FTR purchase contracts (d)

Discounted cash flow

Historical settled prices used to model forward prices

100% (100%)

Heat rate options (e)

Discounted cash flow

Proprietary model used to calculate forward prices

24% - 52% (45%)

Auction rate securities (f)

Discounted cash flow

Modeled from SIFMA Index

57% - 74% (66%)

December 31, 2013

Fair Value, net

Range

Asset

Valuation

Unobservable

(Weighted

(Liability)

Technique

Input(s)

Average) (a)

PPL

Energy commodities

Natural gas contracts (b)

Discounted cash flow

Proprietary model used to calculate forward prices

10% - 100% (86%)

Power sales contracts (c)

(12)

Discounted cash flow

Proprietary model used to calculate forward prices

100% - 100% (100%)

Auction rate securities (f)

Discounted cash flow

Modeled from SIFMA Index

10% - 80% (63%)

PPL Energy Supply

Energy commodities

Natural gas contracts (b)

Discounted cash flow

Proprietary model used to calculate forward prices

10% - 100% (86%)

Power sales contracts (c)

(12)

Discounted cash flow

Proprietary model used to calculate forward prices

100% - 100% (100%)

Auction rate securities (f)

Discounted cash flow

Modeled from SIFMA Index

10% - 80% (63%)

(a) For energy commodities and auction rate securities, the range and weighted average represent the percentage of fair value derived from the unobservable inputs.

(b) As the forward price of natural gas increases/(decreases), the fair value of purchase contracts increases/(decreases). As the forward price of natural gas increases/(decreases), the fair value of sales contracts (decreases)/increases.

(c) As forward market prices increase/(decrease), the fair value of contracts (decreases)/increases. As volumetric assumptions for contracts in a gain position increase/(decrease), the fair value of contracts increases/(decreases). As volumetric assumptions for contracts in a loss position increase/(decrease), the fair value of the contracts (decreases)/increases.

(d) As the forward implied spread increases/(decreases), the fair value of the contracts increases/(decreases).

(e) The proprietary model used to calculate fair value incorporates market heat rates, correlations and volatilities. As the market implied heat rate increases/(decreases), the fair value of the contracts increases/(decreases).

(f) The model used to calculate fair value incorporates an assumption that the auctions will continue to fail. As the modeled forward rates of the SIFMA Index increase/(decrease), the fair value of the securities increases/(decreases).

Net gains and losses on assets and liabilities classified as Level 3 and included in earnings for the periods ended September 30 are reported in the Statements of Income as follows:

		Three Months
		Energy Commodities, net
		Unregulated				Unregulated							Energy
		Wholesale Energy				Retail Energy				Fuel			Purchases
		2014		2013		2014		2013		2014	2013		2014		2013
PPL and PPL Energy Supply
Total gains (losses) included in earnings		$	(102)	$	3	$	16	$	3		$	3	$	2	$	9
Change in unrealized gains (losses) relating
	to positions still held at the reporting date		6		17		13		3					1

		Nine Months
		Energy Commodities, net
		Unregulated				Unregulated							Energy
		Wholesale Energy				Retail Energy				Fuel			Purchases
		2014		2013		2014		2013		2014	2013		2014		2013
PPL and PPL Energy Supply
Total gains (losses) included in earnings		$	(133)	$	(7)	$	(35)	$	18		$	3	$	21	$	9
Change in unrealized gains (losses) relating
	to positions still held at the reporting date		5		7		(12)		18					(3)		5

Price Risk Management Assets/Liabilities - Energy Commodities (PPL and PPL Energy Supply)

Energy commodity contracts are generally valued using the income approach, except for exchange-traded derivative contracts, which are valued using the market approach and are classified as Level 1. Level 2 contracts are valued using inputs which may include quotes obtained from an exchange (where there is insufficient market liquidity to warrant inclusion in Level 1), binding and non-binding broker quotes, prices posted by ISOs or published tariff rates. Furthermore, independent quotes are obtained from the market to validate the forward price curves. Energy commodity contracts include forwards, futures, swaps, options and structured transactions and may be offset with similar positions in exchange-traded markets. To the extent possible, fair value measurements utilize various inputs that include quoted prices for similar contracts or market-corroborated inputs. In certain instances, these contracts may be valued using models, including standard option valuation models and other standard industry models. When the lowest level inputs that are significant to the fair value measurement of a contract are observable, the contract is classified as Level 2.

When unobservable inputs are significant to the fair value measurement, a contract is classified as Level 3. Level 3 contracts are valued using PPL proprietary models which may include significant unobservable inputs such as delivery at a location where pricing is unobservable, delivery dates that are beyond the dates for which independent quotes are available, volumetric assumptions, implied volatilities, implied correlations, and market implied heat rates. Forward transactions, including forward transactions classified as Level 3, are analyzed by PPL's Risk Management department, which reports to the Chief Financial Officer (CFO). Accounting personnel, who also report to the CFO, interpret the analysis quarterly to appropriately classify the forward transactions in the fair value hierarchy. Valuation techniques are evaluated periodically. Additionally, Level 2 and Level 3 fair value measurements include adjustments for credit risk based on PPL's own creditworthiness (for net liabilities) and its counterparties' creditworthiness (for net assets). PPL's credit department assesses all reasonably available market information which is used by accounting personnel to calculate the credit valuation adjustment.

In certain instances, energy commodity contracts are transferred between Level 2 and Level 3. The primary reasons for the transfers during 2013 were changes in the availability of market information and changes in the significance of the unobservable inputs utilized in the valuation of the contract. As the delivery period of a contract becomes closer, market information may become available. When this occurs, the model's unobservable inputs are replaced with observable market information.

Price Risk Management Assets/Liabilities - Interest Rate Swaps/Foreign Currency Contracts/Cross-Currency Swaps (PPL, LKE, LG&E and KU)

To manage interest rate risk, PPL, LKE, LG&E and KU use interest rate contracts such as forward-starting swaps, floating-to-fixed swaps and fixed-to-floating swaps. To manage foreign currency exchange risk, PPL uses foreign currency contracts such as forwards, options and cross-currency swaps that contain characteristics of both interest rate and foreign currency contracts. An income approach is used to measure the fair value of these contracts, utilizing readily observable inputs, such as forward interest rates (e.g., LIBOR and government security rates) and forward foreign currency exchange rates (e.g., GBP), as well as inputs that may not be observable, such as credit valuation adjustments. In certain cases, market information cannot practicably be obtained to value credit risk and therefore internal models are relied upon. These models use projected probabilities of default and estimated recovery rates based on historical observances. When the credit valuation adjustment is significant to the overall valuation, the contracts are classified as Level 3. For PPL, the primary reason for the transfers between Level 2 and Level 3 during 2014 and 2013 was the change in the significance of the credit valuation adjustment. Cross-currency swaps are valued by PPL's Treasury department, which reports to the CFO. Accounting personnel, who also report to the CFO, interpret analysis quarterly to classify the contracts in the fair value hierarchy. Valuation techniques are evaluated periodically.

(PPL and PPL Energy Supply)

NDT Funds

The market approach is used to measure the fair value of equity securities held in the NDT funds.

 The fair value measurements of equity securities classified as Level 1 are based on quoted prices in active markets.

 The fair value measurements of investments in commingled equity funds are classified as Level 2. These fair value measurements are based on firm quotes of net asset values per share, which are not obtained from a quoted price in an active market.

The fair value of debt securities is generally measured using a market approach, including the use of pricing models which incorporate observable inputs. Common inputs include benchmark yields, reported trades, broker/dealer bid/ask prices, benchmark securities and credit valuation adjustments. When necessary, the fair value of debt securities is measured using the income approach, which incorporates similar observable inputs as well as monthly payment data, future predicted cash flows, collateral performance and new issue data.

Auction Rate Securities

Auction rate securities include Federal Family Education Loan Program guaranteed student loan revenue bonds, as well as various municipal bond issues. The probability of realizing losses on these securities is not significant.

The fair value of auction rate securities is estimated using an income approach that includes readily observable inputs, such as principal payments and discount curves for bonds with credit ratings and maturities similar to the securities, and unobservable inputs, such as future interest rates that are estimated based on the SIFMA Index, creditworthiness, and liquidity assumptions driven by the impact of auction failures. When the present value of future interest payments is significant to the overall valuation, the auction rate securities are classified as Level 3. The primary reason for the transfers during 2013 was the change in discount rates and SIFMA Index.

Auction rate securities are valued by PPL’s Treasury department, which reports to the CFO. Accounting personnel, who also report to the CFO, interpret the analysis quarterly to classify the contracts in the fair value hierarchy. Valuation techniques are evaluated periodically.

Nonrecurring Fair Value Measurements (PPL and PPL Energy Supply)

The following nonrecurring fair value measurement occurred during the nine months ended September 30, 2014, resulting in an asset impairment:

	Carrying		Fair Value Measurements Using
	Amount (a)		Level 3		Loss (b)
PPL and PPL Energy Supply
Kerr Dam Project	$	47	$	29	$	18

(a) Represents carrying value before fair value measurement.

(b) The loss on the Kerr Dam Project was recorded in the Supply segment and included in "Income (Loss) from Discontinued Operations (net of income taxes)" on PPL's and PPL Energy Supply's Statement of Income.

The significant unobservable inputs used in and the quantitative information about the nonrecurring fair value measurement of assets and liabilities classified as Level 3 are as follows:

Fair Value, net

Significant

Range

Asset

Valuation

Unobservable

(Weighted

(Liability)

Technique

Input(s)

Average)(a)

PPL and PPL Energy Supply

Kerr Dam Project

March 31, 2014

Discounted cash flow

Proprietary model used to calculate plant value

38% (38%)

(a) The range and weighted average represent the percentage of fair value derived from the unobservable inputs.

Kerr Dam Project

As disclosed in Note 11 in PPL's and PPL Energy Supply's 2013 Form 10-K, PPL Montana holds a joint operating license issued for the Kerr Dam Project. The license extends until 2035 and, between 2015 and 2025, the Confederated Salish and Kootenai Tribes of the Flathead Nation (the Tribes) have the option to purchase, hold and operate the Kerr Dam Project. The parties submitted the issue of the appropriate amount of the conveyance price to arbitration in February 2013. In March 2014, the arbitration panel issued its final decision holding that the conveyance price payable by the Tribes to PPL Montana is $18 million. As a result of the decision, PPL Energy Supply performed a recoverability test on the Kerr Dam Project and recorded an impairment charge. PPL Energy Supply performed an internal analysis using an income approach based on discounted cash flows (a proprietary PPL model) to assess the fair value of the Kerr Dam Project. Assumptions used in the PPL proprietary model were the conveyance price, forward energy price curves, forecasted generation, and forecasted operation and maintenance expenditures that were consistent with assumptions used in the business planning process and a market participant discount rate. Through this analysis, PPL Energy Supply determined the fair value of the Kerr Dam Project to be $29 million at March 31, 2014.

The assets were valued by the PPL Energy Supply Financial Department, which reports to the President of PPL Energy Supply. Accounting personnel, who report to the CFO, interpreted the analysis to appropriately classify the assets in the fair value hierarchy.

Financial Instruments Not Recorded at Fair Value (All Registrants)

The carrying amounts of contract adjustment payments related to the 2011 Purchase Contract component of the 2011 Equity Units and long-term debt on the Balance Sheets and their estimated fair values are set forth below. The fair values of these instruments were estimated using an income approach by discounting future cash flows at estimated current cost of funding rates, which incorporate the credit risk of the Registrants. These instruments are classified as Level 2. The effect of third-party credit enhancements is not included in the fair value measurement.

		September 30, 2014				December 31, 2013
		Carrying				Carrying
		Amount		Fair Value		Amount		Fair Value
Contract adjustment payments (a)
	PPL					$	21	$	22
Long-term debt
	PPL	$	20,757	$	22,854		20,907		22,177
	PPL Energy Supply		2,218		2,267		2,525		2,658
	PPL Electric		2,602		2,919		2,315		2,483

LKE	4,566	4,920	4,565	4,672
LG&E	1,353	1,443	1,353	1,372
KU	2,091	2,287	2,091	2,155

(a) Included in "Other current liabilities" on the Balance Sheets.

The carrying value of short-term debt (including notes between affiliates), when outstanding, approximates fair value due to the variable interest rates associated with the short-term debt and is classified as Level 2.

Credit Concentration Associated with Financial Instruments

(All Registrants)

Contracts are entered into with many entities for the purchase and sale of energy. When NPNS is elected, the fair value of these contracts is not reflected in the financial statements. However, the fair value of these contracts is considered when committing to new business from a credit perspective. See Note 14 for information on credit policies used to manage credit risk, including master netting arrangements and collateral requirements.

(PPL and PPL Energy Supply)

At September 30, 2014, PPL and PPL Energy Supply had credit exposure of $649 million from energy trading partners, excluding exposure from related parties (PPL Energy Supply only) and the effects of netting arrangements, reserves and collateral. As a result of netting arrangements, reserves and collateral, PPL and PPL Energy Supply's credit exposure was reduced to $319 million. The top ten counterparties including their affiliates accounted for $190 million, or 59%, of these exposures. Eight of these counterparties had an investment grade credit rating from S&P or Moody's and accounted for 87% of the top ten exposures. The remaining counterparties have not been rated by S&P or Moody's, but are current on their obligations. See Note 11 for information regarding PPL Energy Supply's related party credit exposure.

(PPL Electric)

PPL Electric is exposed to credit risk under energy supply contracts (including its supply contracts with PPL EnergyPlus); however, its PUC-approved recovery mechanism is anticipated to substantially mitigate this exposure.

(LKE, LG&E and KU)

At September 30, 2014, LKE's, LG&E's and KU's credit exposure was not significant.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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