Company: TVC
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001376986-25-000029
Chunk: 126

Company: Tennessee Valley Authority
Filing Date: 2025-05-01
Form: 10-Q
Item: Part II, Item 3
Chunk 126
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 the perspective of a market participant and should reflect assumptions of other market participants.  An entity should consider all market participant assumptions that are available without unreasonable cost and effort.  These are given the lowest priority and are generally used in internally developed methodologies to generate management's best estimate of the fair value when no observable market data is available.A financial instrument's level within the fair value hierarchy (where Level 1 is the highest and Level 3 is the lowest) is based on the lowest level of input significant to the fair value measurement.The following sections describe the valuation methodologies TVA uses to measure different financial instruments at fair value.  Except for gains and losses on SERP, DCP, and RP assets, all changes in fair value of these assets and liabilities have been recorded as changes in regulatory assets, regulatory liabilities, or AOCI on TVA's Consolidated Balance Sheets and Consolidated Statements of Comprehensive Income (Loss).  Except for gains and losses on SERP and DCP assets, there has been no impact to the Consolidated Statements of Operations or the Consolidated Statements of Cash Flows related to these fair value measurements.Investment Funds At March 31, 2025, Investment funds were comprised of $4.9 billion of equity securities and debt securities classified as trading measured at fair value.  Equity and trading debt securities are held in the NDT, ART, SERP, DCP, and RP.  The NDT holds funds for the ultimate decommissioning of TVA's nuclear power plants.  The ART holds funds primarily for the costs related to the future closure and retirement of TVA's other long-lived assets.  The balances in the NDT and ART were $3.3 billion and $1.5 billion, respectively, at March 31, 2025.  

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Table of Contents                               Draft 4.0                    04/24/2025 5:00 PM

TVA established a SERP to provide benefits to selected employees of TVA which are comparable to those provided by competing organizations.  The DCP is designed to provide participants with the ability to defer compensation to future periods.  The RP is a non-qualified excess 401(k) plan designed to allow certain eligible employees whose contributions to the 401(k) plan are limited by Internal Revenue Service ("IRS") rules to save additional amounts for retirement and receive non-elective and matching employer contributions.  The NDT, ART, SERP, DCP, and RP funds