Note 1. Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2011

Significant Accounting Policies [Text Block]

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Alternate Energy Holdings, Inc., (and its subsidiaries Idaho Energy Complex, LLC, Green World Water, LLC, Energy Neutral, LLC and Reactor Development, LLC) formerly Nussentials Holdings Inc., is a development stage enterprise focused on the purchase, optimization and construction of green energy sources – primarily nuclear power plants.  During fiscal years 2010 and 2011, Energy Neutral, LLC has completed the construction of a model "energy neutral", three additional "energy neutral" homes and is in the process of constructing two other "energy neutral" homes in Boise, Idaho, which feature unique design elements as well as standard “energy neutral” elements, including the Energy Star Certification and solar power generation. The homes are designed and built with the goal of consuming less energy than they produce.

Sunbelt Energy Resources Inc. was formed on August 29, 2005 to operate in the alternate energy industry and has limited operational activity.  In September 2006, Sunbelt acquired Nussential Holdings, Inc. by exchanging 17,900,000 shares of Sunbelt which represented 100% of the outstanding shares for 21,399,998 shares of common stock of Nussential Holdings Inc.  As a result of the acquisition, the shareholders of Sunbelt owned a majority of the voting stock of Nussentials Holdings, Inc. which changed its name to Alternate Energy Holdings, Inc.  The merger has been accounted for as a reverse merger whereby Alternate Energy Holdings, Inc. is the accounting acquirer resulting in a recapitalization of Alternate Energy Holdings, Inc.’s equity.  In connection with and simultaneous to the reverse merger, Nussentials Corporation, a wholly owned subsidiary of Nussentials Holdings Inc. was transferred to Nussential Holdings, Inc. majority shareholder through issuance of 4,252,088 shares of common stock.

Use of Estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, revenues and expenses and the disclosures of contingent assets and liabilities.   Accordingly, actual results could differ from those estimates.

Cash and Cash Equivalents

Alternate Energy Holdings, Inc. considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.  Cash equivalents are stated at cost, which approximates fair value. The Federal Deposit Insurance Corporation insures balances of up to $250,000 at June 30, 2011 and December 31, 2010.   The uninsured balances at June 30, 2011 and December 31, 2010 were $154,740 and $-0-, respectively.

Basic and Diluted Net Loss per Share

Basic and diluted net loss per share calculations are presented in accordance with FASB ASC 260-10, and are calculated on the basis of the weighted average number of common shares outstanding during the year.  They include the dilutive effect of common stock equivalents in years with net income.  Basic and diluted net loss per share are the same due to the absence of common stock equivalents.

Stock Based Compensation

Alternate Energy Holdings, Inc.’s non-employees, share-based expenses are recorded in accordance with FASB ASC 505-50. Alternate Energy Holdings, Inc. has not issued any stock options or stock warrants since its inception through June 30, 2011. During the six months ended June 30, 2011 and 2010, 1,500,000 and 36,000,000 shares of restricted stock were issued for officer/board services, respectively.

Fair Value Measurements

The Company considers fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date.  The Company utilizes the following three-level fair value hierarchy to establish the priorities of the inputs used to measure fair value:

-  Level 1 – Quoted prices in active market for identical assets or liabilities.

-  Level 2 – Observable inputs other than quoted market prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

-  Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.  This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

Comprehensive Income (Loss)

Comprehensive income (loss) is comprised of net income (loss) and other comprehensive income (loss).  Other Comprehensive income (loss) is primarily the result of unrealized gains and losses on Short-Term investments.  The following table set forth the components of comprehensive income (loss):

	Six Months Ended
	June 30,
	2011			2010
Net Loss	$	(1,585,694	)	$	(4,348,646	)
Unrealized Gain on Short-Term Investments		62,605			62,651
Comprehensive Income	$	(1,523,089	)	$	(4,286,395	)

Recently Issued Accounting Pronouncements

In June 2011, the FASB issued Accounting Standards Update “ASU” 2011-05, Presentation of Comprehensive Income.  This ASU is intended to increase the prominence of other comprehensive income to financial statements by presenting components of net income and other comprehensive income in financial statements by presenting the components of net income and other comprehensive income in one continuous statement, referred to as the statement of comprehensive income, or two separate, but consecutive statements.  The new guidance eliminates the current option to report other comprehensive income and it components in the statement of changes in stockholders’ equity.  This new guidance is effective for fiscal years and interim periods beginning after December 15, 2011.  While the new guidance changes the presentation of comprehensive income, there are no changes to the components that are recognized in net income or other comprehensive income under current accounting guidance: therefore, adoption of the new guidance in the first quarter fiscal 2012 will not have any impact on the Company’s consolidated financial position, results of operations or casah flows.

In May 2011, the FASB issued ASU 2011-04, Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and International Financial Reporting Standards (IFRSs”), which amends ACS 820, Fair Value Measurement. ASU 2011-04 does not extend the use of fair value accounting, but provides guidance on how it should be applied where its use is already required or permitted by other standards within U.S. GAAP or IFRSs.  ASU 2011-14 changes the wording used to describe many requirements in U.S. GAAP for measuring fair value and for disclosing information about fair value measurements.

Alternate Energy Holdings, Inc. does not expect the adoption of any other recently issued accounting pronouncements to have a significant impact on their financial position, results of operations, or cash flow.

Revenue Recognition on Sale of Real Estate

Sales and the associated gains and losses of real estate assets are recognized in accordance with the provisions of ASC Topic 360-20, "Property, Plant and Equipment - Real Estate Sale". The specific timing of a sale is measured against various criteria in ASC Topic 360-20 related to the transaction and any continuing involvement in the form of management of financial assistance associated with the properties.

The Company utilizes the full accrual method and if the criteria are not met, the Company defers some or all of the gain recognition and accounts for the continued operations of the property by applying the finance, leasing, deposit, installment or cost recovery methods, as appropriate, until the sale criteria are met.