Message-ID: <12107128.1075844286385.JavaMail.evans@thyme>
Date: Thu, 7 Dec 2000 23:33:00 -0800 (PST)
From: james.saunders@enron.com
To: rod.hayslett@enron.com
Subject: Re: 2002 TW Fuel Sales Trade Confirmation
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Rod - see me comment directly to Dan below.
FYI - We will probably book the income in December since the transaction was 
consummated in a 24hour period in December.  (I may need to bring a more 
reality/pragmatic focus into our accounting theory personnel).
OK?

---------------------- Forwarded by James Saunders/FGT/Enron on 12/08/2000 
07:31 AM ---------------------------


James Saunders
12/08/2000 07:29 AM
To: Dan Fancler/ET&S/Enron@ENRON
cc:  

Subject: Re: 2002 TW Fuel Sales Trade Confirmation  

If the deal was closed out -which it was; I would think the accounting would 
follow.


   
	
	
	From:  Dan Fancler                           12/08/2000 07:27 AM
	

To: Rod Hayslett/FGT/Enron@Enron
cc: Bob Chandler/ET&S/Enron@ENRON, James Saunders/FGT/Enron@Enron 

Subject: Re: 2002 TW Fuel Sales Trade Confirmation  

TW purchased a swap, exchanged a floating 2002 position for a fixed price.  
It was purchased at current market so there is no profit until the 2002 strip 
changes in value.  Since this derivative has been designated as a hedge of 
2002 all changes in market value are deferred in OCI (effective 1/1/01).

Dan



Rod Hayslett

12/08/2000 06:42 AM
To: Bob Chandler/ET&S/Enron@ENRON
cc: James Saunders/FGT/Enron@Enron, Dan Fancler/ET&S/Enron@Enron 

Subject: Re: 2002 TW Fuel Sales Trade Confirmation  

So they sold it, at a profit, now how do we book it?



   
	
	
	From:  Bob Chandler                           12/07/2000 08:42 AM
	

To: James Saunders/FGT/Enron@Enron
cc: Rod Hayslett/FGT/Enron@ENRON, Dan Fancler/ET&S/Enron@Enron 

Subject: Re: 2002 TW Fuel Sales Trade Confirmation  

It represents a hedge of 2002 forecasted sales of TW over-retained 
fuel/unaccounted for volumes.  The swap will be initially recorded in January 
2001 at then market value as a FAS 133 implementation adjustment (any value 
at 1/1/2001 will go to income as an item of "change in accounting 
principles").   Monthly fluctuations in the value of the swap will be marked 
to market with the income effect deferred in Other Comprehensive Income until 
the hedged item (the physical sale) occurs.  The the deferred income will be 
undeferred and brought to income to offset the income/loss from the hedged 
transaction.



James Saunders
12/07/2000 08:28 AM
To: Rod Hayslett/FGT/Enron@ENRON
cc: Bob Chandler/ET&S/Enron@ENRON 

Subject: Re: 2002 TW Fuel Sales Trade Confirmation  

doesn't it need to be marked to market?



Rod Hayslett

12/07/2000 08:24 AM
To: James Saunders/FGT/Enron@ENRON
cc:  

Subject: Re: 2002 TW Fuel Sales Trade Confirmation  

This is for 2002.




James Saunders
12/07/2000 08:22 AM
To: Bob Chandler/ET&S/Enron@ENRON
cc: Rod Hayslett/FGT/Enron@Enron 

Subject: Re: 2002 TW Fuel Sales Trade Confirmation  


We sold short at $4.50?
That would mean we're already under water?