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Accounts Payable and Accrued Liabilities
3 Months Ended
Mar. 31, 2019
Payables And Accruals [Abstract]  
Accounts Payable and Accrued Liabilities

Note 8 — Accounts Payable and Accrued Liabilities

 

 

 

March 31, 2019

 

 

December 31, 2018

 

Commodities

 

$

779.3

 

 

$

721.9

 

Other goods and services

 

 

388.0

 

 

 

478.6

 

Interest

 

 

91.6

 

 

 

79.9

 

Income and other taxes

 

 

40.5

 

 

 

47.7

 

Permian Acquisition contingent consideration

 

 

317.9

 

 

 

308.2

 

Compensation and benefits

 

 

26.5

 

 

 

57.3

 

Preferred Series A dividends payable

 

 

22.9

 

 

 

22.9

 

Other

 

 

13.5

 

 

 

20.8

 

 

 

$

1,680.2

 

 

$

1,737.3

 

 

Accounts payable and accrued liabilities includes $29.3 million and $52.6 million of liabilities to creditors to whom we have issued checks that remained outstanding as of March 31, 2019 and December 31, 2018.

 

Permian Acquisition Contingent Consideration

 

As a result of a 2017 acquisition of certain gas gathering and processing and crude gathering assets in the Permian Basin (the “Permian Acquisition”), we have included the related contingent consideration in accounts payable and accrued liabilities as of March 31, 2019, and December 31, 2018. The Permian Acquisition contingent consideration represents the second earn-out payment, which will be paid in May 2019, and is derived on a multiple of realized gross margin during the earn-out period from contracts that existed on March 1, 2017, in accordance with the terms of the purchase and sale agreements. The first potential earn-out payment would have occurred in May 2018 and expired with no required payment.

 

Changes in the value of the contingent consideration liability have been included in Other income (expense). For the period from December 31, 2018 to March 31, 2019, the value of the contingent consideration increased by $9.7 million, primarily attributable to the elimination of discounting and an increase in actual gross margin through the end of the earn-out period. During the three months ended March 31, 2018, we recognized $56.0 million of expense in Other income (expense) related to the change in fair value of the contingent consideration.

 

See Note 17 – Fair Value Measurements for additional discussion of the fair value methodology.