Company: ATO
Filing Date: 2025-11-14
Form Type: 10-K
Source: 0000731802-25-000056
Chunk: 84

Company: ATMOS ENERGY CORP
Filing Date: 2025-11-14
Form: 10-K
Item: Item 8
Chunk 84
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 understanding of the regulations. Further, regulation may impact the period in which revenues or expenses are recognized.

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Table of ContentsATMOS ENERGY CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Revenue recognitionDistribution RevenuesDistribution revenues represent the delivery of natural gas to residential, commercial, industrial, and public authority customers at prices based on tariff rates established by regulatory authorities in the states in which we operate.  Revenue is recognized and our performance obligation is satisfied over time when natural gas is delivered and simultaneously consumed by our customers.  We have elected to use the invoice practical expedient and recognize revenue for volumes delivered that we have the right to invoice our customers.  We bill our customers on a monthly cycle basis.  Accordingly, we estimate volumes from the last meter read to the balance sheet date and accrue revenue for gas delivered but not yet billed.In our Texas and Mississippi jurisdictions, we pay franchise fees and gross receipt taxes to operate in these service areas.  These franchise fees and gross receipts taxes are required to be paid regardless of our ability to collect from our customers. Accordingly, we account for these amounts on a gross basis in revenue and we record the associated tax expense as a component of taxes, other than income.Pipeline and Storage RevenuesPipeline and storage revenues primarily represent the transportation and storage of natural gas on our APT system and the transmission of natural gas through our 21-mile pipeline in Louisiana.  APT provides transportation and storage services to our Mid-Tex Division, other third party local distribution companies, and certain industrial customers under tariff rates approved by the RRC.  APT also provides certain transportation and storage services to industrial and electric generation customers, as well as marketers and producers, under negotiated rates.  Our pipeline in Louisiana is primarily used to aggregate gas supply for our Louisiana Division under a long-term contract and on a more limited basis to third parties.  The demand fee charged to our Louisiana Division is subject to regulatory approval by the Louisiana Public Service Commission.  We also manage two asset management plans with distribution affiliates of the Company at terms that have been approved by the applicable state regulatory commissions.  The performance obligations for these transportation customers are satisfied by means of transporting customer-supplied gas to the designated location. Revenue is recognized and our performance obligation is satisfied over time when natural gas is delivered to the customer. Management determined that these arrangements qualify for the invoice practical expedient for recognizing revenue. For demand fee arrangements, revenue is recognized and our performance obligation is satisfied by standing ready to transport natural gas