Master Limited Partnerships (MLPs): You re an MLP Now What?

Transcription

1 conference Master Limited Partnerships (MLPs): You re an MLP Now What? Maximizing Data, Reporting, Process Controls and Accounting August 27, 2014 Holland & Hart Office - Downtown Denver EUCI is authorized by IACET to offer 0.7 CEUs for the course. EUCI is authorized by CPE to offer 8.5 credits for this program. 1

2 Overview The oil and gas industry is undergoing major transformation with the rise of master limited partnerships (MLPs). The organizational structure of MLPs is a proven tool for building energy assets. But given their increasing complexity, there are exponential challenges in extrapolating data and developing reporting and accounting practices that work across the organization. The business relationship between the General Partner (GP) and the MLP has a significant impact on financial reporting structure. Whether your MLP is sponsored by a public GP, a private company or some other structure, each arrangement has its own unique challenges to consider from an accounting perspective. Some of the questions you may be asking include: Who are the decision makers driving the drop process and timing of transactions? How do those decisions get pushed out to your department and then how does the planning and, ultimately, the integration materialize? Will your GP own and/or operate a portion of the MLP assets? Is the business activity of the MLP dependent on related business activities of the GP? How inter-dependent is the accounting system between the GP and the MLP? In terms of system communication, what are some system generated opportunities to consider that might provide a fresh look and offer improvements to processes already in place? This program provides insight into these key areas and will aid in developing solid blueprints for scalable controls. In addition, this seminar will explore the regulatory and reporting landscape. Information will include Securities and Exchange Commission (SEC) and Public Company Accounting Oversight Board (PCAOB) developments along with discussion around on-going standard setting related to revenue recognition, leases and financial instruments within the Financial Accounting Standards Board (FASB). MLP finance, audit and accounting experts will lead this interactive 1 day program. The goal is to drive a better understanding of how to better maximize data, reporting, process controls and accounting to increase efficiency and profitability within your progressively complex organization. Who Should Attend Executive officers of companies with General Partner (GP)/Master Limited Partnership (MLP) structures Executives considering investing in an MLP Strategic planners Controllers Accountants Finance and investment banking professionals Consultants Legal professionals Learning Outcomes Discuss initial master limited partnership (MLP) growing pains and hurdles Report on regulatory updates Review the tax rules applicable to dropdowns Report how MLPs are preparing for and integrating asset drops without creating issues with the sponsor s consolidated statements Discuss how to fund your first dropdown/acquisition Discuss the K-1 preparation process Review what consolidation means in terms of assets and efficiencies Identify ways to maximize Enterprise Resource Planning (ERP) and reporting software and maximize automation Identify best practices in terms of management and segregation between parent, general partner and MLP, as well as conflict management Creating historical and pro-forma financial statements for asset drops 2

3 Agenda Wednesday, August 27, :00 8:30 a.m. registration and Continental Breakfast 8:30 9:15 a.m. You re an MLP, Now What? Overview Structure matters relationships between the General Partner (GP) and the MLP, including related businesss activities, inter-dependent accounting systems, etc. SOX reporting issues applicability of Sarbanes-Oxley (SOX) to GP Common Control Consolidation of MLP into GP financials Investment Company Act of 1940 Monitoring compliance - Bob Dennis, Audit Partner, KPMG 9:15 10:00 a.m. Regulatory and Reporting Update 10:00 10:15 a.m. Morning Break Overview of current SEC and PCAOB developments, including JOBS Act, Dodd-Frank and Regulation S-X FASB developments, including revenue recognition, leases and financial instruments 10:15 11:00 a.m. Tax Issues in Dropdown Acquisitions Disguised Sale tax rules, including capital expenditure reimbursements, debt-financed distributions Recent regulatory developments - Adam M. Cohen, Partner, Tax, Holland & Hart LLP 11:00 a.m. 12:15 p.m. Accounting Issues in Dropdown Acquisitions Accounting challenges in public GP, private company or other sponsored MLP Decision Makers Timing Planning Making integration happen Available planning tools and support structures Creating historical and pro-forma financial statements Common control transactions Cost allocations, including SAB Topic 1B1 Periods to be presented 12:15 1:15 p.m. Group Luncheon - Gary Watkins, CAO, Tallgrass Energy 3

4 Agenda Wednesday, August 27, 2014 (Continued) 1:15 2:15 p.m. Funding Dropdown Acquisitions Timing first dropdown relative to IPO Date Debt-equity ratios Follow-on Equity, including 1-day-bookbuild versus overnight marketed offering, size and frequency, cost, timing Debt offerings, including credit rating process for debt offerings, bond versus term loan versus revolver draws Accretion - Dan Campbell, American Midstream 2:15 2:45 p.m. D disclosure in Dropdown Acquisitions SEC Reporting Requirements Materiality Visibility Transparency Market Expectations - Lucy Stark, Partner, Holland & Hart - Ryan Newburn, American Midstream 2:45 3:45 p.m. MLP K-1 s Overview of MLP K-1 Process Time frames Data requirements Investor data gathering process Pitfalls MLP tax conventions Federal versus state filing requirements Investor Relations support Impact on MLP s tax department - Rob Baldwin, PwC - Tom Rainbow, QEP 3:45 4:30 p.m. Maximizing Automation System generated opportunities Implementing stand alone adjustments as separate spreadsheets versus in ERP and financial reporting software Corporate overhead allocations Printers versus in-house SEC filings, including discussion of third-party software reporting tools Kimberly Stinson, EQT 4:30 4:45 p.m. C course Assessment and Adjournment 4

5 speakers Rob Baldwin / National MLP Tax Partner / PwC Rob Baldwin joined PwC as a tax partner in the MLP practice in Since joining PwC, Rob has assisted MLPs with modeling and structuring the impacts of mergers, acquisitions, and dispositions, as well as tax shield calculations, partnership agreement interpretations, technical termination analysis, basis adjustment calculations, Section 704(c) remedial income allocations, and compliance reporting to various federal and state governmental agencies. Prior to joining PwC, Rob served as the Vice President of Tax at Kinder Morgan Inc, the general partner of Kinder Morgan Energy Partners, one of the largest MLPs. Rob was responsible for tax due diligence functions including strategy and structure identification, and implementation for domestic and international acquisitions/dispositions. His responsibilities also included the management of corporate and partnership federal, state, and international planning, compliance, and examinations. Dan Campbell / Senior Vice President and Chief Financial Officer / American Midstream Mr. Campbell was appointed Senior Vice President and Chief Financial Officer in April Prior to his appointment with American Midstream, Mr. Campbell served in various leadership roles with MarkWest Energy Partners, LP from 2006 to 2012, most recently as Vice President of Finance and Treasurer. Mr. Campbell joined MarkWest from TeleTech Holdings, Inc. where he held various senior finance roles from 1997 to 2006 in finance, treasury, strategic planning, and investor relations, including Chief Financial Officer of TeleTech Latin America. Mr. Campbell began his career at Arthur Andersen LLP and he received B.S. and Master s degrees in Accounting from Brigham Young University. Mr. Campbell is a CPA licensed in Colorado. Adam M. Cohen / Partner, Tax / Holland & Hart LLP Adam Cohen is a Tax Partner at Holland & Hart LLP. Mr. Cohen addresses the tax aspects of structuring the formation, acquisition, disposition, operation, and liquidation of businesses of all sizes, from startup ventures to sophisticated public companies. His experience extends to E&P and midstream oil and gas, real estate, and finance industries. He has been integrally involved in structuring billion-dollar transactions. The vast majority of his practice involves handling tax issues for partnerships and LLCs. Bob Dennis / Audit Partner / KPMG Bob Dennis served as office managing partner for KPMG LLP in Tulsa until 2010 and recently transferred to KPMG s Denver office to head up the office s oil and gas practice. As a partner at KPMG, Bob has extensive audit experience serving both privately-held and Fortune 1000 public clients in the transportation, energy, manufacturing, and food processing market segments. Over the years, Bob has served clients including Resolute Energy, Antero Resources, Cimarex Energy, J.B. Hunt Transport Services, ONEOK, Inc., JBS, and Pilgrim s Pride. Bob has extensive audit experience serving clients in the utility and energy industries. In addition to providing audit services to his clients, Bob has provided other professional services such as assisting clients in the acquisition and disposition of business entities, performance of due diligence activities, and registration of securities. He has also assisted the Special Committee of the Board of Directors in an investigation of accusations of wrongdoing resulting from an internal whisle blower letter. KPMG is a global network of professional firms providing Audit, Tax and Advisory services with over 140,000 professionals working together to deliver value in 146 countries worldwide. 5

6 speakers Ryan Newburn / American Midstream Tom Rainbow / Tax Director / QEP Tom Rainbow joined QEP Resources, Inc. in March 2013 to assist in the tax structuring and modeling for the initial public offering of QEP Midstream Partners, LP (QEPM). QEPM began trading in August 2013 and operates gathering and pipeline assets in four states and is in the process of acquiring gas processing facilities in three states. In addition to QEPM, he led the tax function for QEP Resources, Inc. and oil & gas company with operations in the Rocky Mountains, North Dakota, Permian Basin and Haynesville Shale. Jimmi Sue Smith / Vice President and Controller of Midstream and Commercial / EQT Midstream Jimmi Sue Smith is Vice President and Controller, Midstream and Commercial for EQT Midstream, a reporting segment of EQT Corporation. She joined EQT in 2007 as Director of Corporate Accounting,and served as Vice President and Controller, Commercial from Prior to joining EQT, Ms. Smith was Senior Controller for North American Carbon Materials and Chemicals at Koppers, Inc. Additional career experience includes the steel industry, where she served as Manager of Accounting for the Straightline division of United States Steel Corporation; as well as Controller for Wheeling Corrugating Company. Prior to joining the private sector, she was amanager in the audit practice of PricewaterhouseCoopers in Pittsburgh, Pennsylvania. Lucy Stark / Partner, Securities / Holland & Hart LLP Lucy Stark is a Securities Partner at Holland & Hart LLP. Ms. Stark focuses on corporate finance transactions including public and private debt and equity offerings; corporate governance and disclosure issues; mergers, acquisitions and divestitures; and venture capital financing. She has represented multiple MLPs in connection with IPOs, drop-down transactions, and debt and equity securities offerings. Kimberly Stinson / EQT Kim Stinson serves as a Manager in the corporate accounting function for EQT Midstream Partners, LP a growth-oriented limited partnershipformed by EQT Corporation to own, operate, acquire, and develop midstream assets in the Appalachian basin. Kim focuses primarily on transactional accounting and reporting matters for EQT Midstream Partners, including mergers and acquisitions, drop-down transactions and public equity offerings. Prior to joining EQT in 2012, Kim served as Manager in the Assurance Practice for PricewaterhouseCoopers LLP, where she gathered more than seven years of experience serving clients within the metals, mining, and energy industries. Kim earned a Master of Accountancy and Bachelor s Degree in Business Administration from the University of Arizona; and she is also a Certified Public Accountant in Pennsylvania and Arizona. Gary Watkins / CAO / Tallgrass Energy Mr. Watkinds is Chief Accounting Officer of Tallgrass Energy. Prior to this, he served as Vice President, Controller and Chief Accounting Officer for DCP Midstream, LLC and DCP Midstream Partners in Denver, Colorado. Prior to joining DCP, Gary held a variety of positions in the high technology industry including SEC reporting and Internal Audit. He began his career in public accounting at Arthur Andersen serving energy and high technology clients. Gary received his B.S. degree in accounting from Colorado State University. 6

7 Instructional Methods PowerPoint presentations will be used in this program. Requirements for Successful Completion of Program Participants must sign in/out each day and be in attendance for the entirety of the program to be eligible for IACET continuing education credit. iacet Credits CPE Credits PROCEEDINGS EUCI has been accredited as an Authorized Provider by the International Association for Continuing Education and Training (IACET). In obtaining this accreditation, EUCI has demonstrated that it complies with the ANSI/IACET Standard which is recognized internationally as a standard of good practice. As a result of their Authorized Provider status, EUCI is authorized to offer IACET CEUs for its programs that qualify under the ANSI/IACET Standard. EUCI is authorized by IACET to offer 0.7 CEUs for the course. The proceedings of the course will be published, and one copy will be distributed to each registrant at the course. EVENT LOCATION EUCI is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: Upon successful completion of this event, program participants interested in receiving CPE credits will receive a certificate of completion. EUCI is authorized by CPE to offer 7.5 credits for this program. There is no prerequisite for this course. Program Level: Beginner Delivery Method: Group-Live Advanced Preparation: None Holland & Hart Conference Area Holland & Hart LLP th St. Suite nearby hotels Grand Hyatt Denver 1750 Welton St (300 feet north of conference location) Comfort Inn Downtown th St (400 feet southeast) The Brown Palace Hotel th St (0.1 miles southeast) The Denver Marriott City Center 1701 California St (0.1 miles northwest) 7

8 EVENT LOCATION please register the following discount for attending both Master Limited Partnerships (MLPs) Governance, Tax Issues, Financial Considerations and IPO Process, August 26, 2014 And Master Limited Partnerships (MLPs): You re an MLP Now What? Maximizing Data, Reporting, Process Controls and Accounting, August 27, 2014: US $1895 Early bird on or before August 18, 2014: US $1695 Master Limited Partnerships (MLPs): You re an MLP Now What? Maximizing Data, Reporting, Process Controls and Accounting, conference only August 27, 2014: US $995 Early bird on or before August 18, 2014: US $895 Holland & Hart Conference Area Holland & Hart LLP th St. Suite Nearby hotels listed on page 6 EUCI s Energize Weekly newsletter compiles and reports on the latest news and trends in the energy industry. N EUCI has gathered during its 26 years organizing conferences. Sign me up for Energize Weekly. How did you hear about this event? (direct , colleague, speaker(s), etc.) Print Name Job Title Company What name do you prefer on your name badge? Address City State/Province Zip/Postal Code Country Telephone List any dietary or accessibility needs here CREDIT CARD Name on Card Account Number Billing Address Billing City Billing State Billing Zip Code/Postal Code exp. Date Security Code (last 3 digits on the back of Visa and MC or 4 digits on front of AmEx) OR Enclosed is a check for $ to cover registrations. cancellation policy All cancellations received on or before July 25, 2014, will be subject to a US $195 processing fee. Written cancellations received after this date will create a credit of the tuition (less processing fee) good toward any other EUCI event or publication. This credit will be good for six months. In case of event cancellation, EUCI s liability is limited to refund of the event registration fee only. For more information regarding administrative policies, such as complaints and refunds, please contact our our offices at EUCI at (201) reserves the right to alter this program without prior notice. 8