Difference between carrying amount and underlying equity

CSX CORPORATION  
PART IIItem 8. Financial Statements and Supplementary DataNOTE 15.  Investment in Affiliates and Related-Party Transactions  
CSX's investments in affiliates are included on the consolidated balance sheet as investments in affiliates and other companies.

|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
|   | December |  | December |
| (Dollars in Millions) | 2021 |  | 2020 |
| Equity-method investments: |  |  |  |
| Conrail | $ | 1,083  |  |  | $ | 1,025  |  |
| TTX | 849  |  |  | 796  |  |
| Other | 167  |  |  | 164  |  |
| Total | $ | 2,099  |  |  | $ | 1,985  |  |

  
ConrailThrough a limited liability company, CSX and Norfolk Southern Corporation (“NS”) jointly own Conrail. CSX has a 42% economic interest and 50% voting interest in the jointly-owned entity, and NS has the remainder of the economic and voting interests. Pursuant to the Investments-Equity Method and Joint Venture Topic in the ASC, CSX applies the equity method of accounting to its investment in Conrail.  
Conrail owns rail infrastructure and operates for the joint benefit of CSX and NS. This is known as the shared asset area. Conrail charges fees for right-of-way usage, equipment rentals and transportation, switching and terminal service charges in the shared asset area. These expenses are included in purchased services and other on the consolidated income statements. Future payments due to Conrail under the shared asset area agreements are shown in the table below.  


|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| (Dollars in Millions) | Conrail Shared |
| Years | Asset Agreement |
| 2022 | $ | 31  |  |
| 2023 | 31  |  |
| 2024 | 23  |  |
| 2025 | —  |  |
| 2026 | —  |  |
| Thereafter | —  |  |
| Total | $ | 85  |  |

  
Also, included in equity earnings of affiliates are CSX’s 42 percent share of Conrail’s income and its amortization of the fair value write-up arising from the acquisition of Conrail and certain other adjustments. The amortization primarily represents the additional after-tax depreciation expense related to the write-up of Conrail’s fixed assets when the original purchase price, from the 1997 acquisition of Conrail, was allocated based on fair value. This write-up of fixed assets resulted in a difference between CSX's investment in Conrail and its share of Conrail's underlying net equity, which is $331 million as of December 2021.  
CSX 2021 Form 10-K p.102
