Company: TVC
Filing Date: 2025-07-29
Form Type: 10-Q
Source: 0001376986-25-000044
Chunk: 159

Company: Tennessee Valley Authority
Filing Date: 2025-07-29
Form: 10-Q
Item: Part I, Item 1
Chunk 159
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 on its financial condition, results of operations, or cash flows.

14

Table of Contents                               Draft 4.0                    07/24/2025 5:00 PM

3.  Restructuring

TVA’s demand continues to grow, driving the need for significant future capital investment.  TVA must continue to drive efficiencies and cost savings across the enterprise to provide affordable, reliable electricity, while funding the capital investment needed to meet growing demand.  This effort has evolved into an Enterprise Transformation Program ("ETP") focused on improving financial health, enhancing asset performance, automating processes, optimizing third-party spend through supply chain, and making the workforce more efficient.  As part of these efforts, certain employees are eligible for severance payments.  These amounts are recognized in Operating and maintenance expense on TVA's Consolidated Statement of Operations in the period incurred.  Severance costs that have been incurred but not paid are included in Accounts payable and accrued liabilities on TVA's Consolidated Balance Sheets.  The table below summarizes the activity related to severance costs:Severance Cost Liability Activity(in millions)Severance cost liability at September 30, 2024$— Liabilities incurred during the period40 Actual costs paid during the period(26)Severance cost liability at June 30, 2025$14 

4.  Accounts Receivable, Net 

Accounts receivable primarily consist of amounts due from customers for power sales.  The table below summarizes the types and amounts of TVA's accounts receivable:Accounts Receivable, Net(in millions) At June 30, 2025At September 30, 2024Power receivables$1,791 $1,683 Other receivables106 118 Allowance for uncollectible accounts(1)(10)— Accounts receivable, net$1,887 $1,801 Note(1)  To determine the allowance for trade receivables, TVA considers historical experience and other currently available information, including events such as customer bankruptcy and/or a customer failing to fulfill payment arrangements by the due date, among other considerations.  See Note 1 — Summary of Significant Accounting Policies —  Allowance for Uncollectible Accounts.  At June 30, 2025, the allowance for uncollectible accounts included $8 million related to one LPC customer.

5.  Inventories, Net 

The table below summarizes