Uniform System of Accounts for Class C Water Utilities.pdf

UNIFORM SYSTEM OF ACCOUNTS
FOR CLASS
WATER UTILITIES
1996
NATIONAL ASSOCIATION OF
RE G ULA TOR Y UTILITY CO 1\1MI S SI 0 NERS
1201 Constitution Avenue , N., Suite 1102
Post Office Box 684
Washington , DC 20044-0684
Telephone No. [phone]
Facsimile No. [phone]
Price: $15.
Published by the
National Association of
Regulatory Utility Commissioners
1201 Constitution Avenue , N., Suite 1102
Post Office Box 684
Washington , DC 20044-0684
Telephone No. [phone]
Facsimile No. [phone]
NATIONAL ASSOCIATION
REGULATORY UTILITY
COMMISS lONERS
1996
Uniform System of AccountsFor
Class C
Water Utilities
Pursuant to action by the National Association of Regulatory
Utility Commissioners, this System of Accounts is recommended to
the Commissions represented in the membership of this Associationfor consideration and for adoption in their respective
jurisdictions with such modifications only as they may deem
necessary in the public interest..
PREFACE
The 1996 IJat:er and IJast:e....at:er Uniform syst:ems of Account:s ....ere proposed by
t:he Subcommi1:t:ee on Account:s of 1:he Commit:t:ee on Finance and Technology of t:he
Nat:ional Associar.ion of Regulat:ory Ut:ilit:y Commissioners (NARUC). The NARUC
Execut:ive Commit:1:ee unanimously approved 1:hese uniform sysr.ems of account:s ar. ir.s
Summer Commi r.t:ee Meer.ing held in Los Angeles , California , July 22 - 25, 199 b .
would like 1:0 express our. appreciar.ion r.o Marshall willis of r.he Florida Public
Service Commission for his parr.icipar.ion in t:his proj ec r. and r.he many hours
spent: -.rrit:ing r.hese uniform syst:ems of account:s.
COMMITTEE ON FINANCE AND TECHNOLOGY
Ralph Nelson
Roger Hamilt:on , Oregan , Vice-Chair
J. Terry Deason , Florida
Tam Burt:on . Minneso~a
~alt:er L. Challenger, Virgin Islands
Rober~ J. KcMahon, Dela....are
Lo....ell C. Johnson , Nebraska
Janer. Polinsky, Connecr.icut:
M. Dianne Drainer , Kissouri
Rhonda Harr.man Fergus , Ohio
Ed....ard J. Holmes , Kent:ucky
Idaho , Chairman
Karcia G. ~eeks. Arizona
Thomas K. Benedicr., Connec~icur.
E. Kason Hendrickson, Maryland
Dwigh~ D. Ornquist:, Alaska
Richard E. Kolhauser, Illinois
G. Nane r.~e Thompson . Alaska
John C. Shea , Kichigan
Donald L. Soderberg, Nevada
Daniel J. Easr.man , wisconsin
David C. Coen , Vermonr.
STAFF SUBCOMMITTEE ON ACCOUNTS
Gary L. Farman
D. Todd Carden, ~esr. Virginia
Donald R. Hoover ,Nor~h Carolina
B. B. Kno....les . Georgia
william E. Carr.er, Nor1:h Carolina
Timot:hy J. Devlin , Florida
J ames D. Pre~r.i, California
Louis Sickman . Minnesot:a
Michael E. Gallager, Indiana
Norman Reiser. Disr.ricr. of Colombia
Charles J. Kruft:, Maryland
David Hodgden , Ohio
J ames Mendenhall , Michigan
St:ephanie Miller , Idaho
~illiam P. Blume , Sout:h Carolina
Carl L. Mower , Ut:ah
william Lang, Minnesot:a
Kenner.h K. Louie . California
Bill Dennis . Arkansas
Michael J. Chapman . Nevada
Kennet:h M. Ackerman , FCC
Glenn Bar~on , Pennsylvania
J ames Edgar Norman , Alabama
IJal t:er Szymanski, Ne~ Jersey
George Ka~hai , Oklahoma
Kike Gaines . Tennessee
Merr. Lot:t:, Washingt:on
Ken~ucky, Chairman
Jim Richards . Colorado
Michael Foley, NARUC
Donald Judisch lo....a
William Meyer. Missouri
Thomas Kassaro , Rhode Is land
Ronald A. Gibson . Virginia
Mike Diller , Norr.h Dakot:a
Frank Herberr.Ne.... York
Dennis Gee , Ne~ Mexico
Eugene F. Sullivan Ne\ol Hampshire
Terry Lamber.h, Oregon
Michael A. Berson , Connec~icur.
Rich Kania , Maine
Thomas E. Ellison , Sour.h Carolina
Connie S. McDo....ell , Delaware
John Gillespie , Texas
Randall ~. Sable . Arizona
Denise Parrish , Wyoming
Lee Larson , Minnesot:a
Jose L. Rodriguez , FCC
Thomas J. Ferris . ~isconsin
Danna K. Karr.in , Illinois
David ~. ~irick. NRRI
Donna KcLain , Oklahoma
Roland Mar~in Ne.... York
Charles Dickson Ne.... York
. Summary of Proposed Revisions to the
NARUC Uniform System of Accounts for
Class A, B & C Water and Wastewater Utilities
Proposed Changes Water Wastewater
Change the term " sewer " to "wastewater
where applicable to conform with the
terminology currently used by the industry.
A Be A Be
Increased the Class A , B &. C revenue levels
to account for inflation since the levels
were last changed in 1984. This was done
based on the same index used to set thelevels in the 1984 revision. New levels are:
A Be A Be
Class A:
Class B:
Class C:
000 000 and more
$200 000 to $999 999 , and
Less than $200 000.
Included a monetary level for capitalizing AB e A Beversus expensing for all Classes as follows:
Class A:$750
Class B:$400
Class C:$150
Added definitions , accounting instructions
and sub accounts to provide for the accounting
for regulatory assets and liabilities.
Added a .new water plant account to separately ABCaccount for backflowprevention devices.
Added new wastewater plant accounts to A Bseparately account for reuse facilities
used to produce reclaimed water.
A BAdded new wastewater expense accounts to
separately account for the operation of
reuse facilities to produce reclaimed water.
oposed~ha ~es Water Wastewater
Added new wastewater revenue accounts to A B
separately account for revenue from
reclaimed water sales.
Added a new water expense account to
separately account for Water Conservation
Expenses.
10.Requires the use of subaccounts to Accounts AB C ABC271 - CIAC and 272 - Amortization of CIAC
to separately account for any CIAC gross-up
funds received by a utility.Also adds
definitions for gross-up of CIAC.
11.Added a new account to separately account AB C ABCfor revenues collected by a utility prior
to service being initiated to guarantee
or reserve plant capacity.
12.Added. a new water expense account to AB Cseparately account for water testing
expenses.
13.Removed confusing language in Account 218 -ABC ABC. Proprietary Capital - which indicated that
the system provided language concerning the
use of earned surplus accounts , which it
does not.
14.Added a new wasteWater plant account to ABCseparately account for power generation
equipment.
15.Added additional accounts for Contractual
Services to separately account for billing
and professional services.
TABLE OF CON"I'ENTS
Paqe
Index of Accounts
Definitions
Accounting Instructions
Balance Sheet Accounts
Water Utility Plant Accounts
Income Accounts
Water Operating Revenue Accounts
Water Operation and Maintenance Expense Accounts
ACCOUNTING INSTRUCTIONS
Interperiod Tax Allocation - Depreciation
The Federal Economic Recovery Tax Act of 1981 (ERTA) .
ERTA provides that a utility claiming accelerateddepreciation (Accelerated Cost Recovery System (ACRS))must use a normalized method of accounting for federalincome taxes on its regulated books of account and forratemaking purposes. A utility must use the samedepreciation method and lives in computing federalincome tax expense when establishing cost of servicefor ratemaking purposes as is used in its regulatedbooks of account , or if it uses a different method, itmust make adjuscments to a reserve to reflect thedeferral of taxes resulting from such differences.Similarly, in order to claim investment tax credi ts , autility must defer the 'entire balance of invescment taxc~edits on its books of account and amortize the balanceover the life of the related property.
Comprehensive Interperiod Income Tax Allocation - Other ThanDepreciation.
Certain regulatory bodies have required comprehensiveinterperiod income tax allocation of all materialbook-tax timing differences other than depreciationdifferences. They have reasoned that where there are
timing differences between the period in which
transactions affect taxable income and the periods in
which they enter into the determination of pretaxaccounting income, the income tax effects of such,transac~ions are to be recognized in the periods in . which the differences between book 'accounting incomeand taxable income arise and in the periods in which
the differences reverse using the deferred tax method.In general, comprehensive interperiod tax allocationshould be followed whenever transactions enter into thedetermination of pretax accounting income for theperiod even though some transactions may affect thedetermination of taxes payable in a different periodas further qualified below
Utilities are not required to utilize comprehensiveinterperiod income tax allocation until the deferred
income taxes are included as an expense in the ratelevel by the regulatory authority having rate
jurisdiction over the utility. Where comprehensiveinterperiod tax allocation accounting is not practicedthe utility shall include as a note to each financialstatement, prepared for public use , a footnbteexplanation setting forth the utility s accountingpolicies with respect to interperiod tax allocation and
ACCOUNTING INSTRUCTIONS
describing the treatment for ratemaking purposes of thetax timing difference by regulatory authorities havingjurisdiction.
Should the utility be subj ect to more than one agencyhaving rate jurisdiction , its accounts shallappropriately reflect the ratemaking treatment (deferralor flow through) of each jurisdiction.
Once comprehensive interperiod tax allocation has beeninitiated either in whole or in part it shall be
practiced on a consistent basis and shall not be changedor discontinued without prior Commis sion approval'
ACCOUNTING INSTRUCTIONS
EXAMPLE
The following example shows how the varlOUS transactions arerecorded:
a. A utility purchases depreciable plant at a cost of $10 000.The plant has a 10 year life with no salvage.b. The utility s federal taxable income from utility operationsbefore the effect of depreciation is $30 000 (46% tax rate) c. ACRS depreciation for each year is $800 , $1400 , $1200 , $1000$1000 , . $1000 , $900 , $900 , $900 , $900.d. Book depreciation for each year using half year convention inyear .placed in service is: $500 , $1000 , $1000 , $1000 , $1000$1000 , $1000 , $1000 , $1000 , $1000 , $500.e. Investment tax credit is $800 ($10 000 x 8%) in order to use100%- of the $10 000 cost for ACRS depreciation.f. Deferred taxes are calculated by subtracting tax depreciationfrom book depreciation and multiplying by the tax rate. If taxdepreciation is greater than book , debit Account 410 and creditAccount 282. If book depreciation is greater than tax , debit 282and credit 410.
Account
Number AccountTi tIe Debi t Credi t
Year 1
l-a 409.
236
Income Taxes , Utility OperatingIncome
Accrued Taxes $12 632
$12 632
To record taxes estimated to
be payable for period
46($30 000 - $800)) -$800.
b 410.
282 Deferred Income Taxes
Accumulated Deferred Income TaxesLiberalized Depreciation
138
138
To record deferral of a portion
of taxes based on the difference
between straight-line depreciation
Account
Number
c 412.
255
255
412 .
1-e 255
412.
ACCOUNTING INSTRUCTIONS
AccountTitle
and ACRS depreciation (.46 ($500-$800).NOTE: - ~The deferred tax balance of $138
would either be deducted from ratebase or be included in capital
structure at zero cost.
Investment Tax Credits Deferred to
Future Periods , Utility OperationsAccumulated Deferred InvestmentTax Credi t s
To record the investment tax
credits realized and deferred to
future years in accordance withprovlslons of either the "GeneralRule!Option 1 Treatment or the
Special Rule for Ratable Flow
thrdugh" !Option 2 Treatment($10 000 x 8%) .
Accumulated Deferred InvestmentTax Credi t s
Investment Tax Credits Restored
to Nonoperating Income , UtilityOperations
To record ~atable amortization over
the book depreciable life of theinvestment tax credi ts deferred tofuture periods (.50 ($800 (1/10))).NOTE: --The net balance of deferred
investment tax credits ($800 - $40)would be either deducted from ratebas~ or included In capital structure
at zero cost. This treatment lS
followed by utilities subject to the
General Rule" !Option 1 Treatment.
Accumulated Deferred InvestmentTax Credi ts
Investment Tax Credits Restored
to Operating Income , UtilityOperations
To record ratable flow-throughover the asset's book
Debi t
800
Credi t
800
Account
Number
ACCOUNTING INSTRUCTIONS
AccountTitle Debi t Credi t
Year 2
2-a .409.
236
b 410.
282
0 Co
2-c 255
412.
depreciable life of investment
tax credits deferred tofuture periods (.50($800(1/10))). NOTE:--The netbalance of defer+ed ITC ($800-$40.) would earn the overall
rate of return. This treatment.
is followed by utili ties subj ectto "Special Rule for Ratable
Flow-through" IOption 2 Treatment.
Income Taxes, Utility Operating
Income
Accrued Taxes
To record taxes estimated to bepayable for period .46($30 000 -400) .
Deferred Income Taxes
Accumulated Deferred Income
Taxes-Liberalized Depreciation
To record deferral of a portion
of taxes based on the differencebetween straight -line depreciation
and ACRS depreciation (.46 ($1000-$1400)). NOTE: --The cumulative
balance of deferred taxes
($138 + $184) would be either
deducted from rate base
included In capital structure atzero cost.
Accumulated Deferred InvestmentTax Credits
Investment Tax Credits Restored
to Nonoperating Income , UtilityOperations
$13,156
$13 156
184
184
Account
Number
ACCOUNTING INSTRUCTIONS
AccountTitle Debi t Credi t
255
412 .
Year
a 409.
236
b 410.
282
To record ratable amortizationover the asset's book depreciable
life of the ITC deferred to futureperiods ($800 (1/10)). NOTE:--Thenet balance of deferred ITC
($800 - ($40 + $80)) would be either
deducted from rate base or included
in capital structure at zero cost.This treatment is followed by utili tiessubj ect to the General Rule" /Option Treatment.
Accumulated Deferred Investment TaxCredi t s
Investment Tax Credits Restored to
Operating Income , Utility Operations
To record ratable flow-through over
the asset's book depreciable life
of investment tax credits deferred
to future period ($800 (1/10)). NOTE:--The net balance of deferred ITC ($800-($40 + $80)) would earn the overallrate of return. This treatment is
followed by utilities subject to
- the Special Rule for Ratable Flow-Through" /Option 2 Treatment.
Income Taxes , Utility OperatingIncome
Accrued Taxes 248
To record taxes estimated to be
payable for the period (.46($30 000-$1,200)).
Deferred Income. Taxes
Accumulated Deferred Income Taxes
- Liberalized Depreciation
To record deferral of a portion
of taxes based on the differencebetween straight -line depreciation and
248
Account
Number
ACCOUNTING INSTRUCTIONS
Account
Ti tle Debit Credi t
3-c 255
412.
255
412.
Year 4
4-a 409.
236
b 410.
282
4-c 255
412.
ACRS depreciation (($1,000-$1,200) .46).The cumulative balance of deferredtaxes ($138 + $184 + $92) would beeither deducted from rate base orincl uded in capital structure atzero cost.
General Rule" /Option 1 Treatmentutilities would record the same
entry as in Year 2 for amortizationof lTC. The net balance deducted
from rate base or included in
capital structure at zero cost wouldbe ($800-($40 + 2 ($80))).
Special Rule for Ratable Flow-
Through" /Option 2 Treatment
~tilities would record the same
entries recorded in Year 2 forratable' flow- through of lTC.The net lTC balance earning the
overall rate of return would be
$600.
Income Taxes , Utility OperatingIncome
Accrued Taxes
To record taxes estimated to bepayable for the period (.46 ($30 , OOD-000)).
No entry wciuld be made related todeferred taxes because book and
tax depreciation are equal. Thecumulative balance of $414 wouldcontinue to be deducted from rate
base or included in capital
structure at zero cost.
General Rule" /Option 1 Treatmentutili ties. Same entry as Year 2
Net deferred balance either deducted
, 340
340
Account
Number.
4 ~d 255
412.
Year 5
5-a 409.
236
b 410.
282
5-c 255
412.
255
412.
Year
6-a 409.
236
b 410.
282
c 255
412.
ACCOUNTING INSTRUCTIONS
AccountTitle
from rate base or included In
capital structure at zero cost
would be ($800- ('$40+3 ($80))) .
Special Rule for Ratable Flow-Through" /Option 2 Treatmentutilities. Same entry asYear 2. Net balance earning
the overall rate of return would
be. $520.
Same entry as Year
See Year 4.
General Rule" ;Option 1 Treatmentutilities. Same entry as Year
Net ITC balance deducted from
rate base or included In capital
structure lS $44
Special Rule for Ratable Flow-
Through" /Option 2 Treatmentutilities. Same entry as Year
Net ITC balance earnlng overall
rate of return lS $440.
Same entry as Year
See Year 4.
General Rule" /Option 1 Treatmentutili ties same entry as Year
Net ITC balance deducted from
ra te base or included In capital
structure at zero cost lS $360.
Debit
340
340
Credi t
340
340
Account
Number
ACCOUNTING INSTRUCTIONS
Account
Ti tle Debi t Credi t
d 255
412.
Year 7
a 409.
236
282
410 .
,) .
7 - c 2 5 5
412.
d 255
412 .
Year 8
a-a 409.
~3 6
Special Rule for Ratable Flow-
Through~ /Option 2 Treatmentutili ties. Same entry as Year
Net ITC balance earning the
overall rate of return is $360.
Income Taxes , Utility OperatingIncome
Accrued Taxes
To record taxes estimated to
be payable for the period
46($30 000 - $900)).
Accumulated Deferred Income Taxes -Liberalized Depreciation
Deferred Incbme Taxes
To ~ecord reversal of taxesdeferred 1n pr1or years ($1000$900) .46). NOTE:--The net deferredtax balance deducted from rate
base or included 1n capital structure
at zero cost 16 $368.
General Rule /Option 1 Treatmentutilities. Same entries as Year
Net ITC balant~ deducted from rate
base or included 1n capital structure
at zero cost is $280.
Special Rule for Ratable Flow-
Through /Option 2 Treatmentutilities. Same entry as Year
NOTE: - -Net ITC balance earn1ng
the overall rate of return 1S $280.
Same entry as Year
a 0
13, 3 a 6
13 386
386
386
Account
Number
ACCOUNTING INSTRUCTIONS
AccountTitle Debi t Credi t
282
410.
255
412 .
255
412.
Year 9
9-a 409.
236
282
410.
255
412.
255
412.
Same entry as Year
NOTE: - -Net balance deducted from
rate base or included in
capital structure at zero cost
is $322.
General Rule /Option 1 Treatmentutilities. Same entry as Year
NOTE: - -Net ITC balance deducted
from rate base or included in
capi tal structure at zero cost
is $200.
Special Rule for Ratable . Flow-Through" /Option 2 Treatmentutilities. Same entry asYear 2. NOTE: - -Net ITC balance
earning the overall rate of returnis $200.
Same entry as Year 7
Same entry as Year 7. NOTE: --
Net balance of deferred taxe~
deducted from rate base
included in capital structure
at zero cost is $276.
General Rule /Option 1 Treatmentutilities. Same entry as Year
NOTE: - -Net balance ITC deducted
from rate base or included in
capital structure at zero cost
is $120.
Special Rule for Ratable Flow-
Through" /Option 2 Treatmentutilities. Same entry as Year
NOTE: - -Net balance ITC earning
overall rate of return is $120.
13 386
13 386
Account
Number
ACCOUNTING INSTRUCTIONS
AccountTitle Debi t
Year 10
Credi t
10-a 409.
236
10-b 282
410.
10-c 255
412.
10-d 255.
412.
::J
..-
Year 11
11-a 409.
236.
11-b 282
410.
Same entry as Year
Same entry as Year 7. NOTE: --
Net balance deferred taxes
deducted from rate base orincl uded in capital structure
at zero cost is $230.
General Rule /Option 1 Treatmentutili ties. Same entry as Year
NOTE: - -Net balance ITC deducted
from rate base or included in
capital structure at zero cost
is $40.
Special Rule for Ratable Flow-
Through" /Option 2 Treatmentutilities. Same entry as Year
NOTE: - -Net balance ITC earningoverall rate of ,return is $40.
Income Taxes , Utility Operating
Income
Acc+ued Taxes, Utility Operating
Income
To record taxes estimated to
be payable for period
46($30 000)).
Accumulated Deferred Income Taxes
Liberalized Depreciation
Deferred Income Taxes
To record reversal of taxes
deferred in prior years
( ($ 500 - 0). 46). NOTE: - - Thereis no longe~ a ,deferred tax
balance to be deducted from ratebase or included in capital
structure at zero cost.
13 , 386
800
230
13 I 386
, 8 a 0
230
Account
Number
ACCOUNTING INSTRUCTIONS
AccountTi tIe Debi t Credi t
ll-c 255.
412.
I1-d 255.
412.
General Rule" /Option 1 Treatmentutilities. Same entry as Year
NOTE: --There is no longer an ITCbalance to' be deducted from ratebase or included in capital
structure at zero cost.
40
Special Rate for Ratable Flow-
Through" /Option 2 Treatmentutili ties. Same entry as Year
NOTE: - -There is no longer an ITC
balance to earn the overall rateof return.
Operatinq Income - Clearinq Accounts
A. The purpose of a clearing account is to temporarily accumulatein one account costs of a specific type which affect more than asingle account , and which subsequently will be apportioned amongutili ty plant accounts , operating expense accounts and otherappropriate accounts. -
B. The use of clearing accQunts is optional. In addition to thepayroll clearing account , a utility may use such additional
clearing accounts as it finds useful.
10l.
103.
104.
105.
108.
114.
115.
12l.
122.
124.
131.
132.14l.
143.
151.
174.,
186.
190.
" ,
BALANCE SHEET ACCOUNTS
Assets and Other Debi
Utility Plant in Service
Property Held for Future Use
Utility Plant Purchased or Sold
Construction Work in Progress
Accumulated Depreciation and Amortization of Utility Plantin Service
Utility Plant Acquisition Adjustments
Accumulated Amortization of Utility Plant Ac~isitionAdj ustments
Nonutility Property
Accumulated Depreciation and Amortization of Nonutility PropertyUt ili ty Investments
CashSpecial Deposits
Customer Accounts Receivable
Accumulated Provision for Uncollectible Accounts- -Cr.Plant Material and Supplies
Miscellaneous Current and Accrued Assets
Miscellaneous Deferred Debits
Accumulated Deferred Income Taxes
Equity Capital
201. Common Stock Issued
2D4. ,Preferred Stock Issued211. Other Paid- In Capital
215. Retained Earnings
218. Proprietary Capital
224.23l.
232.
235.
236.
237.24l.
252.
253.
255.
265.27l.
272.,
28l.
282.
283.
(for proprietorships and partnerships only)
Liabili ties and Other Credits
Long-Term Debt
Accounts Payable
Notes Payable
Customer Deposits
Accrued Taxes
Accrued Interest
Miscellaneous Current and Accrued Liabilities
Advances for ConstructionOther Deferred Credits
Accumulated Deferred Investment Tax Credits
Miscellaneous Operating Reserves
Contributions in Aid of Construction
Accumulated Amortization of Contributions in Aid of ConstructionAccumulated Deferred .Income Taxes - Accelerated AmortizationAccumulated Deferred Income Taxes - Liberalized Depreciation
Accumulated Deferred Income Taxes - Other
BALANCE SHEET ACCOUNTS
Utili ty Plant
101. Utility Plant in Service
A. This account is the control account for plant accounts 301through 3480.
B. This account shall include the original cost of utility plantowned and used by the utility in providing water service.
103. Property Held for Future Uses
A. This account shall include the cost of property owned and heldfor future use in utility service under a definite plan for suchuse.
B. The property included in this account shall be classifiedaccording to the detailed accounts (301 to 348) for utility plant.in service and the account shall be maintained in such manner andin such detail as though the property were in service.
Note : - -Materials ' and supplies and meters held in reserve shall notbe included in this account.
l04. Utility Plant Purchased or Sold
A. This account shall be temporarily charged with the cost andexpense incidental to acquisition of utility systems acquired
operating units or systems. The account shall be temporarilycredited with the selling price of utility systems transferred toothers.
B. Within six months from the date of acquisition or sale of awater system the utility shall file with the Commission for
approval proposed journal entries to clear this account.
Note:- - In clearing this account the original cost of acquired plant
shall be charged to plant accounts and accumulated depreciationshall be credited to account 108 - Accumulated Depreciation and
Amortization of Utility Plant in Service. Any balance(representing the difference between the net original cost of theassets acquired and the cost to the acquiring utility) shall. becharged or credited to account 114 - Utility Plant AcquisitionAdj ustments .
C. When an existing water system or operating unit is acquiredthe utility shall be obligated to obtain from the vendor allexisting records , including records of plant construction dates and
costs record~ of' accumulated depreciation applicable to suchpropertie, and records of Contributions in Aid of Construction.
BALANCE SHEET ACCOUNTS
105. Construction Work in Proqress
This account shall include the cost of water plarit in processof construction, but not ready for service.
108. Accumulated DeDreciation and Amortization of Utility Plant inService
A. This account shall reflect the d~preciation and amortizationaccumulated on plant used in water utility service.
This account shall be credited with:1. Amounts concurrently charged to account 403
Depreciation Expense representing currently accruing
depreciation of water plant (other than contributed plant) 2. Amounts concurrently charged to account 407
Amortization Expense - Other, representing currently accrulngamortization of utility plant.
::~.
3. Amounts concurrently charged to account 272
Accumulated Amortization of Contributions in Aid Construction, representing amortization of contributed utilityplant, if recognized by the Commission.4. Salvage value, sales price , insurance settlements andother amounts recovered from plant ret~red. 5. Amounts representing the balance of accumulated
depreciation and amortization of utility plant acquired fromothers.
Note:
- -
Also see account 104 -Utility Plant Purchased or Sold.
This account shall be charged with:
Original cost of depreciable utility plant retired.
Cost of removal of plant retired.D. The utility is restricted in the use of this account to thepurposes set forth above. It shall not transfer any portion toretained earnings or to other accounts without prior written
authorization from the Commission.
Note:- -See Accounting Instruction 4 for information on depreciationaccruals and plant retirement procedures.
BALANCE SHEET ACCOUNTS
114. Utili tv Plant AcQUisition Adl ustmentsA. This account shall include the difference between (1) thecost to the utility of plant acquired as an operating unit or
system by purchase , merger, or otherwise , and (2) the net ofamounts distributed to the plant accounts; the accumulateddepreciation account and other appropriate accounts.B. No transfers shall be made from this account unless priorwri t ten authorization has been obtained from the Commission.
Note:See also account 104 - Utility Plant Purchased or Sold.
115. Accumulated Amortization of Utility Plant AcQUisition Adlustments
This account shall be credited or debited with amounts which
are includible in account 406 - Amortization of Utility PlantAcquisition Adjustments , or account 426 - Miscellaneous NonutilityExpenses, for the purpose of providing for the extinguishment of
amounts in account 114 - Utility Plant Acquisition Adjustments.
121. Nonutilitv Pro~ertv
A. This account shall include all property and other assets owned - by the utility, but not used in providing water service
fL....;which separate balance sheet accounts have not been provided.
This account shall be appropriately subdivided.
Items
Land and buildings hot used in water operations.Utility assets transferred to "nonoperative " status.Investments in securi ties.Assets of nonutility businesses owned by the utility.Accounts receivable and notes receivable not due wi thinone year.
122. Accumulated Depreciation and Amortization of Nonutilitv PropertyA. This account shall reflect the depreciation and amortizationaccumulated on property not used in utility operations.B. This account shall be credited with a~ounts currently chargedto account 426 - Miscellaneous Nonutility Expenses, representingcurrently accruing depreciation and amortization on property notused in utility operations.
C. ,This account shall be charged with the amount of depreciat:(accumulated 6n items of nonutility property sold , abandoned , orotherwise retired.
BALANCE SHEET ACCOUNTS
124. Utility Investments
This account shall include book cost of investments in
securities issued or assumed by nonassociated companies for thepurpose of insuring adequate water service (i. e., source of watersupply)
131. Cash
This account shall include the amount of cash on hand or
deposit in banks.
132. Special Deposits
This account shall include deposits with fiscal agents orothers for the payment of interest and/or dividends.
141. Customer Accounts Receivable
This account shall include amounts due from customers forutility service.
143 . Accumulated Provision for Uncollectible Accounts-~Cr
This account shall be credited with amounts provided for
losses on . accounts receivable which may become uncollectible, andalso with collections on accounts previously charged hereto.Concurrent charges shall be made to account 670 - Bad Debt Expense,for amounts applicable to utility operations , and to correspondingaccounts for other operations. Records shall be maintained so to show the write-offs of accounts receivable for each utilitydepartment.
151. Plant Material and Supplies
A. This account shall include the cost of materials and supplieson hand , purchased for use in plant construction or repair work.B. The cost shall include , when practicable, transportationcharges, sales and use taxes and other directly assignable costs.Cash discounts realized on material purchases shall be credited tothis account.
C. Reusable materials which are retired from plant and ret~rnedto the materials and supplies inventory shall be charged to thisaccount and credi ted to account 108 - Accumulated Depreciation andAmortization of Utility Plant . in Service. Identifiable units whichhave been removed from service (i. e., pumps , motors , etc.) shall becarried in inventory at original cost. Items of small value whoseoriginal cost cannot be readily determined shall be carried ininventory at current 'prices. ' Scrap materials shall be carried ininventory at estimated scrap value.
BALANCE SHEET ACCOUNTS
D. Inventories of materials and supplies shall be taken at leasL
annually and the necessary adjustments shall be made to bring this
account into agreement with the actual quantiLies on hand.
174. Miscellaneous CurrenL and Accrued Assets
This account shall include the book cost of all other currenL
and accrued assets, appropriately designated and supported so as to
show the nature of each asset included herein.
186. Miscellaneous Deferred Debits
A. This account shall include such items as expenses of security
issues, bond discount , items in suspense, and costs which the
Commission has authorized the utility to amortize over futureperiods (i. e., deferred portion of rate case expense)
This account shall be appropriately subdivided.
190. Accumulated Deferred Income Taxes
A. This account shall be debited and account 411.10 - Provision
for Deferred Income Taxes - ~redit , Utility Operating Income , or
account 411.20 - Provision for Deferred Income Taxes Credit
, .
Other Income and Deductions, as appropriate , shall be credited
an amount equal to that by which income taxes payable for the year
are higher because of the inclusion of certain items in income for
tax purposes , which items for general accounting purposes will not
be fully reflected in the utility s determination of annual net
income until subsequent years.
B. This account shall be credited and account 410.10 - Deferred
Income Taxes or account 410.20 - Provision for Deferred IncomeTaxes, Other Income and Deductions , as appropriate, shall be
debi ted with an amount equal to that by which income taxes payable
for the year are lower because of prior payment of taxes as
provided by paragraph A above , because of differences in timing for
tax purposes of particular items of income or income deductions
from that recognized by the utility for general accountingpurposes. Such credit to this account and debit to account 410.
or 410.20 shall, in general , represent the effect on taxes payable
in the current year of the smaller amount of book income recognized
for tax purposes as compared to the amount recognized in theutilitys current accounts with respect to the item or class
items for which deferred tax accounting by the utility was
authorized by the Commission.
C. Vintage year records with respect to entries to this account
as described above , and the account balance, shall be so maint2
as to show the factor of calculation with respect to ~ach annua.
amount of the item or class of' items for which deferred tax
accounting by the utility is utilized.
BALANCE SHEET ACCOUNTS
D. The utility is restricted in its use of this account to thepurpose set forth above. It shall not make use of the balance inthis account or any portion thereof except as provided in the textof this account , without prior approval of the Commission. Anyremaining def erred tax account balance with respect to an amountfor any prior year s tax deferral , the amortization of which orother recognition in the utility s income accounts has beencompleted, or other disposition made shall be debited to account410.10 - Deferred Income Taxes , or account 410.20 - Provision forDeferred Income Taxes - Other Income and Deductions , asappropriate, or otherwise disposed of as the Commission may
authorize or direct (See Accounting Instruction 6) .
Equi ty Capital
201. Common Stock Issued
A. This account shall be credited with the total par value or
stated value of common stock outstanding-B. Premiums related to the issue of common stock shall becarried in ' a separate subaccount of account 211 - Other Paid- Capi tal.
204. Preferred Stock Issued
A. This account shall be credited with the total par value orstated value of preferred stock outstanding.B. A separate subaccount shall be maintained for each
class andserles of pref e~red stock.C. Premiums and discounts related to the issue of preferred
stock shall be carried in a separate subaccount of account 211 -Other Paid- In Capital.
211. Other Paid-In CapitalA. This account shall include all paid- in capital not' derivedfrom earnings. It shall include such items as premiums and
discounts related to the issuance of capi tal stock I donations tothe utility of its capital stock , credits arising from theforgiveness of debt of the utility; credits arising out of areorganization of the utility or in connection wi th itsrecapi talization.B. Each type of paid- in capital shall be carried in a separatesubaccount.
BALANCE SHEET ACCOUNTS
215. Retained Earnin (for corporations onl
A. This account shall reflect corporation earnings retained
the business.
The account shall be credited with:1. Net Income.2. Accounting adjustments associated with correction
errors attributable to a prior period.
The acc6unt shall be charged with:1. Net losses.2. Accounting adjustments associated with correction
errors attributable to a prior period.3 . Di vidends .
D. Adjustments caused by the correction of an estimate or
change in an accounting method shall not adjust the balance of thisaccbunt but shall rather affect either an income , asset , liabilityor deferred c~edi t account. For example , adj ustments toaccumulated depreciation shall not affect this account but rathershall affect an' income account , account 186 - Miscellaneous 'Deferred Debits , or account 253 - Other Deferred Credits.
218. Pro rieta ital (for proprietorships and partnerships onl v)A. This account shall be credited with the investment of a soleproprietor, or partners , in an unincorporated water utili ty.
Separate subaccount shall be maintained for each partner.C. At the end of each calendar year the net income or loss forthe year shall be entered in this account. D. Accounting adjustments associated with correction of errorsattributable to a prior period shall be charged or credited to thisaccount. See also account 215 , item D , above.
Note
: - -
This account may be restricted to the amount cons~dered bythe proprietor to be the permanent investment in the businesssubj ect to change only by addi tional investment by the proprietoror the withdrawal of portions thereof not representing net income. When this option is taken , earned surplus accounts shallbe maintained
BALANCE SHEET ACCOUNTS
Liabili ties and Other Credits
224. Other LonG-Term Debt
A. This account shall include all notes condi tional salescontracts or other evidences of indebtedness payable more than
oneyear from date of issue.B. Separate subaccounts shall be maintained for obligationsoutstanding.
231. Accounts Payable
This account shall include all amounts payable by the utilitywi thin one year , which are not provided for in other accounts.
232. Notes Payable
This account shall include the face value of all notesdrafts, acceptance , or other similar evidences of
indebtedness payable on demand or within a time not exceeding one year from dateof issue. .
235. Customer Deposits
This account shall include all amounts deposited with theutility by customers as security for the payment of bills.
236 . Accrued Taxes
A. This account shall include all taxes accrued or payable by, theutility including property taxes , payroll taxes , withholding taxes and corporate taxes.
B. This account shall be credited during the accounting periodwith the amount of taxes accrued during the period. Such creditsmay be based ~pon estimates , but from time to time during the yearthe amount of the periodic credits shall be adjusted so as toreflect the correct tax liability. Any amount representing aprepayment of taxes applicable to a period subsequent to
the dateof the balance sheet shall be shown under account 174 - Miscellaneous Current and Accrued Assets.
Note:
- -
Liabili ty for personal income or self -employment taxes ofowner or partners shall not be entered in the books of
the utility,al though payment of such taxes may be charged as withdrawals toproprietary capital.
BALANCE SHEET ACCOUNTS
237. Accrued Interest
This account shall include the amount of interest accrued butnot matured on all liabilities of the utility not including,however , interest which is added to the principal of the debt on
which incurred. Supporting records shall be maintained so as toshow the amount of interest accrued 6n each obligation.
241. Miscellaneous Current and Accrued Liabilities
This ac~ount shall include the amount of all other currentand accrued liabilities not provided for elsewhere appropriately
designated and supported so as to show the nature of eachliabili ty.
252. Advances for Construction
This account shall include advances by or in behalf ofcustomers for construction which are to be refunded ei ther whollyor in part. When a person is refunded the entire amount, to whichhe is entitled according to the agreement or rule under which theadvance was made , the balance , if any, remaining in this accountshall be transferred to account 271 - Contributions in Aid ofConstruction.
253. Other Deferred Credits
This account shall include , gains on disposition of property,net of income taxes , deferred by authorization of the Commissionadvance billings and receipts and other deferred credi t items , notprovided e~sewhere , including amounts which cannot be entirely
cleared or ~isposed of until additional information has beenreceived.
255. Accumulated Deferred Investment Tax Credits
A. This account shall be credited with all investment tax
credits deferred by companies which have elected to follow deferralaccounting, partial or full , rather than recognizing in the incomestatement the total benefits of the tax credit as realized. Aftersuch election , a company may not transfer amounts from thisaccount, except as authorized herein and in accounts 412.11 -Investment Tax Credits Restored to Operating Income, UtilityOperations 412.20 - Investment Tax Credits - Net , NonutilityOperations, and account 412.30 - Investment Tax Credits Restored Nonoperating Income , Utility Operations, or with approval of theCommission.
B. Where the company's accounting provides that investment taxcredits are to be passed on to customers , this account shall bedebited and account 412.11 credited with a proportionate amountdetermined in relation to the book depreciable life of all utility
BALANCE SHEET ACCOUNTS
property or utility property to which the tax credits relate orsuch lesser period of time as allowed by a regulatory agency havingrate jurisdiction. If , however , the deferral procedure providesthat investment tax credits are not passed on to customers , theproportionate restorations to income shall be credited to account412.30.
C. Subdi visions of this account by department shall be
maintained for deferred investment tax credits that are related tononutility or other operations. Contra entries affecting suchaccount s~bdi visions shall be appropriately recorded. Use ofdeferral or nondeferral accounting procedures adopted for nonutility or other operations are to be followed on a consistentbasis.
D. Separate records for each utility department and nonutili tyor other operations shall be maintained identifying the propertiesgiving rise to the investment tax credits for each year with theappropriate service life of such properties and any unused balancesof such credits. Such records are not necessary unless the taxcredits are deferred.
265. Miscellaneous Operatinq Reserves
A. This account shall include all operating reserves maintainedby the utility.
B. This account shall be maintained in such manner as to showthe amount of each separate reserve and the nature and amounts ofthe debits and credits thereto.
271. Contributions in Aid of Construction
This account shall include:1. Any amount or item of money, services or propertyreceived by a utility, from any person or governmentalagency, any portion of which is provided at no cost to the
utili ty - which represents an addition or transfer to thecapital of the utility, and which is utilized to offset theacquisi tion, improvement or, construction costs of the
utili ty ' s property, facilities or equipment used to provideutility services to the public. 2. Amounts transferred from account 252 - Advances for
Construction representing unrefunded balances of expiredcontracts or discounts resulting from termination of
contracts in accordance with the Commission s rules andregulations.
3 . Compensation received from governmental agencies and
others for relocation of water mains or other plants.
BALANCE SHEET ACCOUNTS
4) Any amount of money received by a utility, any portion
which is provided at no cost to the utility, which represents
an addition or transfer to the capital of the utility andwhich is utilized to offset the federal , state or local income
tax effect of taxable contributions in aid of construction,
taxable amounts transferred from Account 252 - Advances forConstruction, and taxable compensation received from
governmental agencies and others for relocation of water mainsor other plants shall be r~flected in a sub-account of thisaccount.
B. The credits to this account shall not be transferred to anyother account without the approval of the Commission.C. The records supporting the entries to this account shall be sokept that the utility can furnish information as to the purpose ofeach donation , the conditions, if any, upon which it was made , theamount of donations from (a) states (b) municipalities ' (c) customers, and (d) others, and the amount applicable to eachutility department.
Note
: - -
There shall not be included in this account advances forconstruction which are ultimately to be repaid wholly or in part(See account 252 - Advances for Construction)
272. Accumulated Amortization of Contributions in Aid of ConstructionA. This account shall reflect the amortization accumulated onaccount 271 - Contributions in Aid of Construction~' if recognizedby the Commission.
B. Specifically, balances in account 271 which represent
contributions of depreciable plant shall be a~ortized by charges tothis account over a period equal to the estimated service lifethe related contributed asset. A group or overall composite ratemay be used for contributed balances that cannot be directly
related to a plant asset.C. The concurrent credi t for the amortization recorded in thisaccount shall be made to account 403 - Depreciation Expense.
D. . If a regulatory body allows the amortization Qf any portion ofthe monies collected to pay the tax obligation caused by thereceipt of CIAC, such amortization shall also be reflected in ~sub-account of this account. Specifically, balances in account 271which represent monies collected for the gross -up of CIAC (SeeDefinition 7.shall be amortized by charges to this account overa period determined by the regulatory body.
BALANCE SHEET ACCOUNTS
Accumulated Deferred Income Taxes
Before using the deferred tax accounts provided below , referto Accounting Instruction 7 (8) and (C). Interperiod Income TaxAllocation - Depreciation and Comprehensive Interperiod Income TaxAllocation - O~her Than Depreciation.
Public utilities shall use the accounts provided below for
prior acc~mulations of deferred taxei on income for additionalprovisions. Prior to any use of these accounts, the utility mustfile with the Commission , for the purpose of obtainingauthorization, its proposed plan of accounting for d~ferred taxeson income. The utility shall not use these accounts unless such
use has been authorized by the Commission. If deferred taxaccounting is initiated with respect to any property such
accounting shall not be discontinued on that property without prior- approval of the Commission.
The utility is restricted in .its use of these accounts to thepurposes set forth therein. It shall not make any transfers fromthese accounts or make any use thereof except as provided in thetext of the accounts without prior approval of the Commission. Itshall not transfer the balance in these accounts or any portionthereof to retained earnings except as provided in the text of thisaccount without prior approval of the Commission.
Upon the disposition by sale , ~xch~nge , transfer , abandonmentor premature retirement of plant on which there is a relatedbalance in these accounts , the deferred ,tax account shall bedebi ted wi th an amount equal to the related income tax expense" ifany, arising from such disposition and account 411 - Provision forDeferred Income Taxes-Credit , shall be credited. When theremaining balance , after consideration of any related income taxexpenses, is not significant , the deferred tax accQunt shall bedebi ted and account 411 credi ted with such balance. I f afterconsideration of any related incom~ tax expense , and the remainingamount is significant , then the Commission shall authorize ordirect how such amount shall be accounted for at the
time approvalfor the disposition of accourit is granted. When plant is disposedof by tr.;insfer to a wholly owned subsidiary, the related balance inthe deferred tax account shall also be transferred. When thedisposition relates to retirement of an item or items
under a groupmethod of depreciation where there is no tax effe~t in the year ofretirement, no entries are required in the deferred tax account ifit can be determined that the related balances would be necessary
to be retained to offset future group item tax def iciencies.
Note
: - -
Public utilities having more than one utili ty departmentand/ or nonutili ty property dnd which have deferred taxes on incomewith respect thereto shall classify such deferrals in
the accountsprovided elsewhere so as to allow ready identification of items
BALANCE SHEET ACCOUNTS
relating to each utility department and to Other Income andDeductions.
281. Accumulated Deferred Income Taxes - Accelerated AmortizationA. This account shall include tax deferral resulting from
adoption of the principles of Comprehens i~e Interperiod Income TaxAllocation - Other Than Depreciation described , in AccountingInstruction 6 (c) of this system of accounts that relate to
property for which the utility have availed itself of the use ofaccelerated (5 -year) amortization of (1) certified defensefacilities as permitted by Section 168 of the Internal Revenue Codeand. (2) certified pollution control facilities as permitted by
Section 169 of the Internal Revenue Code.B. This account shall be credited and accounts 410.10 - DeferredIncome Taxes , or account 410.20 - Provision for Deferred IncomeTaxes, Other Income and Deductions , as appropriate, shall bedebited with tax effects r~lated to property described in paragraphA above where taxable income is lower than pretax accounting incomedue to differences between the periods in which revenues and
expense transactions affect taxable income and the periods in whichthey enter into the determination of pretax accounting inco~e.C. This account shall be debited and accourtts 411.10 - ~rovisLfor Deferred Income Taxes
- '
Credit, Utility Operating Income , or411.20 - Provision for Deferred Income Taxes-Credit, Other Incomeand Deductions , as appropriate , shall be credited with tax effectsrelated to property described in paragraph A above where taxableincome. is higher than pretax accounting income due to differencesbetween the periods in which revenues and expenses transactionsaffect taxable income and the periods in which they enter into thedetermination of pretax accounting income.D. Records wi th respect to entries to this account, as describedabove, and the account balance, shall be so maintained as to showthe factors of calculation and the separate amounts applicable tothe plant additions of each vintage year for each class I group, orunit. The uhderlying calculations to segregate and associatedeferred tax amounts with the respective vintage years may be basedon reasonable methods of approximation, if necessary, consistentlyapplied.
282. Accumulated Deferred Income Taxes - Liberalized Depreciation
A. , This account shall include all credit tax deferrals resultingfrom adoption of the principles of comprehensive interperiodincome tax allocation described in Accounting Instruction 7 of thissystem of accounts other than those deferrals which are includib'in accounts 281 - Accumulated Deferred Income Taxes - AccelerateLAmortization, and account 283 - Accumulated Deferred Income Taxes -Other.
. 36
BALANCE SHEET ACCOUNTS
B. This account shall be credited and accounts 410 .10 D~ferredIncome Taxes , or 410.20 - Provision for Deferred Income Taxes
Other Income and Deductions , as appropriate , shall be debi ted withtax effects related to property described in paragraph A abovewhere taxable income is lower than pretax accounting income due todifferences between the periods in which revenue ,and expensetransactions affect taxable income and the periods in which theyenter into the determination of pretax accounting income.C. This account shall be debited and accounts 411.10 - Provisionfor Deferred Income Taxes - Credit, Utility Operating Income, or411.20 - Provision for Deferred Income Taxes - Credit, Other Incomeand Deductions , as, appropriate , shall be credited with tax effectsrelated to property described in paragraph A above where taxableincome is higher than pretax accounting income due to differencesbetween the periods in which revenue and expense transactionsaffect taxable income and the periods in which they enter
into thedetermination of pretax accounting income.D. Records with respect to entries to this account , as describedabove, and the account balance , shall be so maintained as to showthe factors of calculation and the separate amounts applicable tothe plant additions of each vintage year for each class
, group, orunit. The underlying calculations to segregate and associatedeferred tax accounts with the respective vintage years may . based on reasonable methods of approximation, if necessary,consistently applied.
283. Accumulated Deferred Income Taxes - OtherA. This account shall include all ~redit tax deferrals resultingfrom the adoption of the principles of comprehensive interperiodincome tax allocation described in Accounting Instruction 7 of thissystem of accounts other than those deferrals which are includiblein accounts 281 - Accumulated Deferred Income Taxes - AcceleratedAmortization, and 282 - Accumulated Deferred Income Taxes Liberalized Depreciation.
B. This account shall be credited and account 410 - Provisionfor Deferred Income Taxes , shall be debited wi th tax effectsrelated to items described in paragraph A above where taxableincome is lower than pretax accounting income due to differencesbetween the periods in which revenue and expense transactionsaffect taxable income and the periods in which they enter
into thedetermination of pretax accounting income.c. This account shall be debited and accounts 411.10 - Provisionfor Deferred Income Taxes - Credit I Utility Operating Income or411.20 - Provision for Deferred Income Taxes - Credit , Other Incomeand Deductions , as appropriate , shall be credited with tax effectsreI a ted to items described in paragraph A above where taxableincome is higher than pretax accounting income due to differences
BALANCE SHEET ACCOUNTS
between the periods in which revenues and expense transactions
affect taxable income and the periods in which they enter in~o the
determination of pretax accounting income.D. Records with respect to entries to this account, as describedabove. and the account balance , shall be so maintained as to show
the factors of calculation with respect to each annual amount ofthe item or class of items.E. For ratemaking purposes ' the balance in accounts 281 , 282
and 283 - Accumulated Deferred Income Taxes - AcceleratedAmortization, Liberalized Depreciation , and Other. net of any
balance in account 190 - Accumulated Deferred Income Taxes , shalleither be deducted from rate base by all companies having a net
credit balance of deferred taxes or shall be included in capital
structure as zero cost funds. The treatment shall be determined by
the regulatory body having jurisdiction over the regulated
operations of the utility. Where regulated operations are subj ectto the jurisdiction of more than one regulatory body, each
regulatory body shall establish the ratemaking treatment of those
deferrals related to operations under its jurisdiction.
WATER UTILITY PLANT ACCOUNTS
Amort i z abl e
301. Organization
302. Franchises
Nondepreciable
303. Land and Land Rights
Depreciable
304.
305.
306.
307.
309.
310.31l.
320.
330.33l.
333.
334.
336.
335.
339.
340.34l.
343.
345.
348.
Structures and Improvements
Collecting and Impounding Reservoirs
Lake River and Other Intakes
Wells and Springs
Supply Mains
Power Generation Equipment
Pumping Equipment
Water Treatment Equipment
Distribution Reservoirs and Standpipes
Transmission and Distribution Mains:Services
Meters and Meter Installations
Backflow Prevention DevicesHydrants .
Other Plant and Miscellaneous Equipment
Office Furniture and EquipmentTransportation Equipment
Tools Shop and Garage Equipment
Power Operated EquipmentOther Tangible Plant
WATER UTILITY PLANT ACCOUNTS
301. OrGanization
This account shall include all fees paid to federal or state
governments for the privilege of incorporation and expenditures
incident to organizing the corporation , partnership or other
enterprise and putting it into readiness to do business. A sample
of items to be included in this account are listed below.
Actual cost of obtaining certificates authorizing an
enterprise to engage in the public utility business.
Fees and expenses for incorporation.
Fees and expenses for mergers or consolidations.
Office expenses incident to organizing the utility
Stock and minute books and corporate seal.
302. Franchises
A. This account shall include amounts paid to the federalgovernment, to a state or to a political subdivision thereof in
consideration for franchises , consents or certificates, running in
perpetuity or for a specified term of more than one year , together
with necessary and reasonable expenses incident to procuring such
franchises or certificates of permission and approval. B. This account shall not include any expenses incurred
connection with the authorization or sale of securities , or
discounts on securities issued.
.. )
C. This account shall not include any sum for franchises or
certificates in excess of the amounts actually paid to the state or
political subdivision , and necessary and reasonable expenses
incident to obtaining such fran~hises or certificates.
D. When any franchise has expired , the book cost thereof shall
be credited hereto and charged to account 426 - MiscellaneousNonutility Expens~s, or to account 108 - Accumulated Depreciation
and Amortiza~ion of Utility Plant in Service, as appropriate.
303. Land and Land Riqhts
This account shall include the cost of land , rights - of -way and
easement used in water operations.
304. Structures and ImDrovements
This account. shall include cost in place of structures and
improvements used in connection with source of supply, pumping,
water treatment , transmission and distribution and general plant.
A sample of items to be included in this account are listed belc
Items
WATER UTILITY PLANT ACCOUNTS
Yard paving and fencing.
Pump houses and storage sheds.Grading and clearing.
Meter testing shops.Landscaping, sidewalks.Roadways paved , concrete , etc.Buildings.
Plant metering.
305 . CollectinG and ImpoundinG Reservoirs
This account shall include the ~ost in place of structures andimprovements used for impounding, collecting and storing water inthe source of supply system. A sample of items to be included inthis account are listed below:
Items
- Clearing.
2 . Dams.
3 . Embankmen t s .
4 . Fences.
306. Lake, River and Other Intakes
Landscaping.Retaining .walls.
Roads.Spillways and channels.
This account shall include the cost installed of lake , riverand. other intakes used as a source of water supply. A sample ofitems to be included in this account are isted below:
I terns
Condui ts .Fences.Gate houses.
307 , Wells and SprinGs
Intake pipes.Intake wells.
This account shall include the cost installed of wells andsprings used as a source of water supply. A sample of items to beincluded in this account are listed below:
Items
Clearing.Collecting plpes.Fences.
Landscaping.
Springs and appurtenances.
Wells , casings and
and appurtenances.
WATER UTILITY PLANT ACCOUNTS
309. Suppl V Mains
This account shall include the cost installed of supply mainspipes, aqueducts and canals and their appurtenances. A sample ofitems to be ,included in thls account are listed below:
Items
Manholes.Municipal inspection orpermits.
Reconstruction of pavementdisturbed.Master Meters.
310. Power Generation 'Equipment
Mains
Main Installat ion.Valves, valve vaults
and appurtenances.
This account shall include the cost installed of any equipr ~ntused for the production of power principally used in pumpingoperations.
311. Pumpinq Equipment
This account shall include the cost of electric , gas, "'gasoline, or other types of ' pumping equipment. A sample of item~to be included in this account are listed below:
Items
Engines.Motors.Turbines.
Pumps.
320. Water Treatment Equipment
Pressure regulating and
recording instruments.
Electric power lines.
Swi tching equipment.
This account shall include the cost of equipment used in
treatment of water. A sample of items to be included in thisaccount are listed below:
Softening equipment.
Chlorination equipment.Sand traps.
Set tling basins.Disinfection equipment.
Fil tering equipment.~urification equipment.
Fluoridat ion eq~ipment.
Reverse osmosis membranes.
330. Distribution Reservoirs and Standpipes
This account shall include the cost of reservoirs
, ,
storagetanks, hydropneumatic tanks and standpipes used in storing waterfor distribution.
WATER UTILITY PLANT ACCOUNTS
B. The account shall be segregated so as to show separ~tely thecost of each major facili ty or installation.
331. Transmission and Distribution Mains
This account shall include the cost . installed of water mainsincluding valves , fittings , shut-offs , etc., between - the watersource and customer' s service. This account shall also include thecost installed of fire mains.
333. Services
This account shall include the cost installed of service plpesleading from the water main to the customers ' premises.
334. Meters and Meter Installations
A. This account shall include the cost of meters , devices andappurtenances attached thereto
, .
used for measuring the quantity water delivered to users , whether actually in service or held inreserve. It shall also include the cost of labor employedmaterials used and expenses incurred in connection with theoriginal installat ion of ~ customer s meters and devices andappurtenances attached thereto
B. Records shall be kept to show the number of meters of eachtype and size in service or held on stock , and their location.C. .A sample of. items to be included in this account are listedbelow:
I terns
Meters.Meter boxes.
Yokes.
Stops.Installation labor,
Note.
- -
The cost of "master meters" used to measure the quantity ofwater produced or delivered into the system shall be entered inaccount 3~ 9 - Supply Mains.
335. Hydrants
This account shall include the cost installed of hydrantsowned by the utilit.y.
Note:--A hydrant begins at and includes the fittings at theconnection wi th the main.
WATER UTILITY PLANT ACCOUNTS
336. Backflow Prevention Devices
A. This account shall include the cost of backflow prevention
devices, and attached appurtenances, used for preventing the
backflow of water, whether actually in service or held in reserve.
It shall also include the cost of labor employed , materials used
and expenses incurred in connection with the original installation
of a customer s backflow prevention device and appurtenances
attached thereto unless done ~n conjunction with a meterinstallation.
B. When a backflow prevention device is permanently retired from
servlce, the amount at which it is included herein shall
credited to this account.
C. The records covering backflow prevention devices shall be so
kept that the utility can furnish information as to the number of
backflow prevention devices of each type and size in service and in
reserve as well as the location of each backflow prevention device
included in this account.
339. Other Plant and Miscellaneous Equipment
This account shall include the cost installed of all other
intangible, source of supply and pumping ,water treatment and
transmission and distribution plant not provided for in thepreceding accounts.
340. Office Furniture and Equipment
This account shall include the cost of office furniture and
equipment owned and used by the utility. A sample of items to be
included in this account are listed below:
Items
4 .
Adding machines.
Addressing machines.
Calculating machines.
Drafting room equipment.
Computers., 9.
Postage meter machines.
Desks , typewriters.
Filing cabinets.
Book cases , tables, chairs.
341. Transportation Equipment
A. This account shall include the cost of trucks , automobiles andtrailers owned and used by the utility.
Records shall be maintained to show the cost of each vehicle.
WATER UTILITY PLANT ACCOUNTS
343. Tools, Shop and Garaqe Equipment
This account shall include the cost of tools, implements I anoequipment used in construction I repair work, general shops andgarages ~nd not specifically provided for or includible in otheraccounts.
345. Power Operated Equipment
This account shall include the cost of power operated
equipment used in construction of repair work exclusive ofequipment includible in other accounts. Include, also, the toolsand accessories acquired for use with such equipment and thevehicle on which such equipment is mounted. A sample of items tobe included in this account are listed below:
Items
Air compressors.
Back filling machines.Tractors.Trenchers.
Note
: - -
It is intended that this account include only such largeuni ts as are generally self -propelled or mounted on moveableequipment.
348. Other Tanqible Plant
This account shall include the cost of tangible utility plantnot provided for elsewhere.
400.
401.
403.
406.
407.
408.
409.
410.
411.
412.
419.
420.
421.
426.
427.
408.
409.
410 -
411.
412.
INCOME ACCOUNTS
Utili ty Operating Income
Operating Revenues
Operating Expenses
Depre ciation Expense
Amortization of Utility Plant Acquisition Adjustment
Amortization Expense - Other
Taxes Other Than Income
Income Taxes
409.10' Federal Income Taxes , Utility Operating Income
Provision for Deferred Income Taxes
410.10 Deferred Income Taxes
Provision for Deferred Income Taxes - Credit
411.10 provision for Deferred Income Taxes - Credit, Utility
Operating IncomeInvestment Tax Credits
412.10 Investment Tax Credits Deferred to Future Periods, UtilityOperations
412.11 Investment Tax Credits Restored to Operating Income
Utility Operations
Other Income and Deductions
Interest and Dividend Income
Allowance for Funds Used During Construction
Nonutility Income
Miscellaneous Nonutility Expenses
Interest Expense
, :'
Taxes Applicable to Other Income and Deductions
Taxes Other Than Income
Income Taxes
409.20 Income Taxes
, .
Other Income and Deductions
Provision for Deferred Income Taxes
410.20 Provision for Deferred Income Taxes , Other Income andDeductions
Provision For Deferred Income Taxes - Credit411.20 Provision for Deferred Income Taxes - Credit, Other Income
and DeductionsInvestment Tax Credits
412.20 Investment Tax Credits
412.30 Investment Tax Credits
Utility Operations
- Net, Nonutility Operation~
Restored to Nonoperating Income
. INCOME ACCOUNTS
Operating Income
400. OperatinG Revenues
Thi~ is the revenue control account ~hich totals the account.scredi ted to revenue accounts 460 through 474 for water systems.
401. OperatinG Expenses
This is the operating expense control account which totalsthe amounts charged to operating expense accounts
601 through 67Sfor water systems.
403. Depreciation Expenses
A. This account shall be charged with depreciation credited
account 108 - Accumulated Depreciation and Amortization of UtilityPlant In Service and credited with amortization debited to account272 - Accumulated Amortization of Contributions in Aid ofConstructiOn. Depreciation shall be accrued on a straight -lineremaining life basis or straight -line basis , as required by theCommission. A single composite depreciation rate may be used approval from the Commission is obtained.
Note A : - -See Accounting InstruCtion 4 , for more detailedinstructions on depreciati6n accounting.B. Depreciation for property not used in water 6perations is
charged to account 426 - Miscellaneous Nonutili ty. Expense , and iscredited to account 122 - Accumulated Depreciation and Amortizationof Nonutility Property.
406. Amortization of Utility Plant Acquisition Ad"iustments
This account shall be debited or credited , as the case may, only upon the approval of the governing regulatory authority,for the purpose of providing for the extinguishment of the amount inaccount 114 - Utility Plant Acquisition Adjustments.
407. Amortization Expense - Other
This account shall include amortization debits or credits
which relate to utility operations and are not provided forelsewhere.
408. Taxes Other Than Income
A. These a~counts shall include the amount of ad valorem
, grossrevenue or gross receipts taxes , regulatory agency generalassessments for purposes of public utility regulation
, stateunemployment insurance , franchise t.axes , federal excise taxes
INCOME ACCOUNTS
social security taxes , and all other taxes assessed by federal,
state. county, municipal. or other local governmental authorit ies,
except income taxes.
B. These accounts shall be charged in each accounting period
with the amounts of taxes which are applicable thereto, wi
concurrent credits to account 236 - Accrued Taxes. or account 174 -
Miscellaneous Current and Accrued Assets. as appropriate. When
is not possible to determine the exact amounts of taxes, the
amounts shall be estimated and adjustments made in curreni ac~ruals
as the actual tax levies become known.
C. The charges to these accounts sh~ll be made or supported
as to show the amount of each tax aDd the basis upon which each
charge is made. In the case ~f a utility rendering more than one
utility service I taxes of the kind includible in these accounts
shall be assigned directly to the utility department the operation
of which gave rise to the tax in so far as practicable. Where the
tax is not attributable to a specific utility department, it shall
be distributed among the utility departments or nonutility
operations on an equitable basis after appropriate study to
determine such basis.
Note A
: - -
Special assessments for street and similar improvements
shall be included in the appropriate utility plant or nonutility
property' account.
Note B
: - -
Taxes specifically applicable to construction shall be
included in the cost of construction.
Note C
: - -
Gasoline and other sales taxes shall be charged as far
practicable to the same account as the materials on which the tax
levied.
Note D
: - -
Social security and other forms of payroll taxes shall
distributed to utility departments and to nonutility functions on a,basis related to payroll. Amounts applicable to construction shall
be charged to the appropriate plant account.
Note E
: - -
Interest on tax refunds or deficiencies shall not beincl uded in these accounts but. in account 419 - Interest and
Di vidend Income , or 427 - Interest Expense.
409. Income Taxes
A. These accounts shall include the amounts of local, state and
federal income taxes on income properly accruable during the period
covered by the income statement to meet the actual liabili ty for
such taxes. Concurrent credi tS for the tax accruals shall be made
to account 236 - Accrued Taxes , and as the exact amounts of taxes
become known, the current tax accruals shall be adjusted by charges
4, 8
INCOME ACCOUNTS
or credits to these accounts unless such adjustments are properlyincluded in account 215 - Retained Earnings , so that these accountsas nearly as can be ascertained shall include the actual taxespayable by the utility.
B. The accrua~s far local , state and federal income taxes shallbe apportioned to Utillty Operating Income (by department/division) Other Income and Deductions and Extraordinary Items so that , asnearly as practicable , each tax included in the expenses of theutility department , Other Income and Deductions or Extraordinary
Items, shall be related to the income which gave rise to the tax.The income tax effect of amounts recorded iri account 215 - RetainedEarnings, shall be recorded in that account. The tax effects relating to interest charges , other than interest specif icallyapplicable to indebtedness on property in account 121 shall beincluded in account 409.10 - Income Taxes , Utility Operating Income.C. This account shall be maintained according to the subaccounts409.10 and 409., as shown below.
Note A
: --
Taxes assumed by the utility on interest shall be chargedto account 427 - Interest Expense.
Note B
: - -
Interest on tax refunds or deficiencies shall not
included in this account but in account 419 - Interest and DividendIncome, or account 427 - Interest' Expense, as appropriate.
Note c
: - -
See Accounting Instruction
409.10 Income Taxes, Utility Operatinq Income
This account shall include the amount of those federalstate, and local income taxes reflected in account 409 -Income Taxes , which relate to utility operating' income afterinterest charges and other tax adjustments. This accountshall be maintained so as to al~ow ready identification oftax effects (both positive and negative) relating to UtilityOperating Income (by department/division), Utility PlantLeased to Others and Other Utility Operating Income.
409.20 Income Taxes, Other Income and Deduct ions
This account shall include those local, state , and federalincome taxes reflected in account 409 - Income Taxes , (bothpositive and negative), which relate to Other Income andDeduct ions.
410. Provision for Deferred Income Taxes
A. Accounts 410., and 410.20 shall be debited and accounts 281282, or 283 Accumulated Deferred Income Taxes - Accelerated
INCOME ACCOUNTS
Amortization, Liberalized Depreciation , or Other, shall be creditedwith amounts equal to any current deferrals of taxes on income orany allocations of deferred taxes originating in prior periods , asprovided by the texts of accounts 190 , 281 , 282 , and 283. credit amounts appropriately includible in account 411.10 or 411.shall be netted against entries require~ to be made to theseaccounts.
B. This account shall be maintained according to the subaccounts410., and 410.20 inclusive , as shown below.
Note
: - -
See Accounting Instruction
410.10 Deferred Income Taxes
This account shall. include the amounts of those deferrals
of federal , state , and local income taxes and allocations ofdeferred federal income taxes which relate to Utility
Operating Income (by department/division)
410.20 Provision for Deferred Income Taxes. Other Income andDeductions
This account shall include the amount of those deferred
federal, state and local income taxes ~eflected in account410 - Provision for Deferred Income Taxes, which relate toOther Income and Deductions.
411. Provision for Deferred Income Taxes - CreditA. Accounts 411.10 and 412.20 shall be credited , and accounts 28i,282 , or 283 , Accumulated Deferred Income Taxes - AcceleratedAmortization, Liberalized Depreciation or Other, shall be debited,with amounts equal to any allocations of deferred taxei originatingin prior periods or any current deferrals of taxes on income, asprovided by the texts of accounts 190, 281, 282 , and 283. No debitamounts appropriately includible in account 410., or 410.20 shallbe netted against entries required to be made to these accounts.
411.10 Provision For Deferred Income Taxes - Credit. Utility,Operatinq Income
This account shall include the amounts of thoseallocations, of deferred federal , state and local incometaxes and deferrals of federal, state and local incometaxes, credit which relate to Utility Operating Income '(bydepartment / di vision)
INCOME ACCOUNTS
411.20 Provision For Deferred Income Taxes - Credit, Other Incomeand Deductions
This account shall include the amounts of th-oseallocations of deferred taxes and deferrals, of taxescredi t / which relate to Other Income and Deductions.
412. Investment Tax Credits
A. This account shall be debited with the total amount of
investment tax credits used in calculating the reported currentyears income taxes payable.
Account 255 - Accumulated Deferred Investment T~x Creditsshall be credited with an equal amount of investment tax creditsdebited to this account. Investment tax credits related to propertyused in utility operations shall be debited to subaccount 412.10 -Investment Tax Credits Deferred to Future Periods
. Utili tyOperations. Those investment tax credits related to property used
in nonutility operations shall be debited to account 412.20 -Investment Tax Credits - Net . Nonutility Operations.B. A company which has deferred its investment tax credits shallamortize these deferred credit amounts by crediting this
account anddebi ting account 255 - Accumulated Deferred Investment Tax credits.Such annual amortization shall be allocated proportion~tely
over theservice lives of all assets or of the assets generating the credits.The proportional amounts shall be determined in relation to themethod of depreciation .actually used on the regulated books ofaccount.
(I) Iri amortizing the deferred investment tax creditsrelated to property used in utility operations , the annualproportional amount credited to account 412 - Investment TaxCredi ts may or may not be passed on to customers in accordancewith the Internal Revenue Code section applicable to thecompany. Where the company is subject to Section 46 (f)(2) ofthe code which provides a "Special rule for ratable flow- through" or Option 2 treatment , the annual proportionalamortization is to be credited ~o subaccount 412.11 -Investment Tax Credits Restored to Operating Income . UtilityOperations. Where the company is subj ect to Code Section 46 (f) (I), which is the "General Rule" or Option 1 treatment , theannual proportional amortization shall be credited to
subaccount 412.30 - Investment Tax Credits Restored to
Nonoperating In~ome , Utility Operations.
(2) In amortizing, the deferred investment tax creditsrelated to property used in nonutility operations , the annualamount shall be credi ted to subaccount 412., Investment TaxCredi ts - Net. Nonutili ty Operations.
INCOME ACCOUNTS
C. This account shall be maintained so that the debits and
credits relating to each allowable percentage of credit, i. e., 3 ~
4%, 6%, 7%, 8% 10%, etc. may be readily identified.
D. This account shall be maintained so that the debits and
credits relating to each utility department/division and each
nonutility operation may be readily identified.
E. This account shall be maintained according to subaccounts
412.412.11,412.20 and 412.30 as shown below.
412.10 Investment Tax Credits Deferred to Future Periods, Utility
Opera t ions
This account shall be debited and 'account 255 -
Accumulated Deferred Investment Tax Credits shall be
credited with the amounts of realized investment tax credits
deferred to future periods related to property used in
utility operations (department/division).
412.11 Investment Tax Credits Restored to Operatinq , Income. UtilityOperations
This account sh~ll be credited and account 255
Accumulated Deferred Investment Tax Credits, shall bedebited with the proportionate .amounts of deferred
investment tax credits related to property used in utility
operations being restored to operating income in accordancewith the "Special Rule for Ratable Flow-through" or Option
treatment as provided in the Revenue Act of 1971, the Tax
Reduction Act of 1975 or the Economic Recovery Tax Act of
1981.
412.20 Investment Tax Credits - Net, Nonutility Operations
A. This account shall be debited and account 255
Accumulated Deferred Investment Tax Credits , shall be
credited with the amounts of realized investment tax
credits deferred to future periods which relate to propertyused in nonutility operation~.
B. This ac~ount shall be credited and account 255
Accumulated Deferred Investment Tax Credits shall be debited
wi th the proportionate amounts of deferred investment tax
credits related to property used in nonutility operatiQns
being restored to nonoperating income.
INCOME ACCOUNTS
412.30 Investment Tax Credits Restored to NonoperatinG Income,Utility Operations
This account ,shall be credited and account 255 -Accumulated Deferred Investment Tax Credits, shall be debitedwith the proportionate amounts of deferred investment taxcredits related to property used in utility qperations beingrestored to nonoperating income in accordance with theGeneral Rule" or Option 1 as provided by the Revenue Act of1971, the Tax Reduction Act of 1975 and the Economic
Recovery Tax Act of 1981.
Other Income and Deductions
419. Interest and Dividend Income
This account shall include interest revenues on
securities loans , notes , advances special deposits; tax refunds and all otherinterest bearing assets and dividends on stocks of other
companies whether the securi ties are carried as investments or included sinking or other ~pecial funds accounts.
420. Allowance for Funds Used DurinG Construction
This account shall include concurrent credits for allowancefor funds used during construction based upon the net
cost of fundsused for construction purposes and a reasonable rate upon otherfunds when so used. Appropriate regulatory approval shall obtained for "a reasonable rate"
421. ~onutilitv Income
In this account is entered all income not includible
operating revenue accounts 460 through 474 or in account 419 Interest and Dividend Income. Items in this account shall include:
3 .
Grdss income from nonutility ~perations;Net gain on sale of nonutili ty property; andRevenues from merchandising, jobbing and contract work.
426. Miscellaneous Nonutility Expenses
This account shall contain all expenses other than expensesof utili ty operations and interest expense. Items which areincluded in this account are:
Expenses disallowed in a proceeding before the
Commission.
Amort i za t ion of an Acquisition Adj ustment not approvedby the Commission.
10.
II.
12.
13.
14 .
15.
INCOME ACCOUNTS
Depreciation associated with plant not used and useful inthe public service.
Depreciation of Nonutility Plant.. Imprudent expenses. .
Donations for charitable , social or communi~y welfarepurposes.
Life insurance on officers and employees where utility beneficiary (net premiums less increase in cash surrendervalue of policies)
Penalties or fines for violations of statutes pertainingto regulation.
Expenditures for the purpose of:a. Influencing public opinion with respect to theelection or appbintment of public officials , or theadoption, repeal , revocation or modific~tion ofreferenda, legislation or ordinances.
Influencing public opinion with respect to obtainingapproval, modification or revocation of franchises.Influencing the decisions of public officials not
including such expenditures which are directly
related to appearances before regulatory or othergovernmental bodies in connection with the utility
. existing. or propbsed operatioris.
Loss relating to investments in securities writteri-off- orwritten:-down.
. .
Loss on sale of investments.
Loss on reacquisition , resale or, retirement of utilitydebt securities.
Preliminary survey and investigation expenses related toabandoned projects , when not written-off to theappropriate operating expense account.Golf club dues , social club dues and service club dues(Kiwanis , Rotary, etc.) house charges and items of asimilar nature whether such expenditures are made directlyby the utility or indirectly by payment or reimbursementto associated companies , officers , or other employees , orby any other direct or indirect means. Costs and expenses of merchandising, jobbing, and contractwork.
427. Interest Expense
This account shall be charged all interest expense of theutili ty. The contra credit to entries in this account shall becharged to account 237
- .
Accrued Interest o.
460.
461.
462.
, 465.
466.
WATER OPERATING REVENUE ACCOUNTS
Water Sales
Unmetered Water Revenue
460.Unmetered Sales to Residential Customers460.Unmetered Sales to Commercial Customers460.Unmetered Sales to Industrial Customers460.Unmetered Sales to Public Authorities460.5. Unmetered Sales to Multiple Family Dwellings
460.Unmetered Sales - Other
Metered Water Revenue
461.Metered Sales to461.Metered Sales to461.Metered Sales to461.Metered Sales to461.Metered Sales to
Fire Protection Revenue
Sales to Irrigation Customers
Sales for Resale
Residential C~stomers
Commercial Customers
Industrial Customers
Public Authorities
Mul tiple Family Dwellings
Other Water Revenues
469. Guaranteed Revenues
474 . 'Other Water Revenues
WATER OPERATING RE~ ACCOUNTS
460. Unmetered Water Revenue
Water Sales
A. This account shall include the net billing for water supplied
for residential, commercial and industrial (except irrigation)purposes where the charge is not dependant in any way on the
quanti ty of water delivered but is based on diameter of servicepipe., room , foot of frontage or other similar unit.B. Records shall be maintained so that the estimated quantity
water sold and the amouht of revenue under each rate schedule shallbe readily available-
This account shall be subdivided as follows:
460.
460.
460 -
460.
460.
460.
Unmetered
Unmetered
Unmetered
Unmetered
Unmetered
Unmetered
SalesSalesSalesSalesSalesSales
to Residential Customers
to Commercial Customers
to Industrial Customers
to Public Authorities
to Multiple Family Dwellings- Other
46~. Metered Water Revenue
A. This account .shall include the net billing for measured water
supplied for residential," commercial or industrial (exceptirrigation) purposes where the. total charge is ,or may be , in anyway dependent on the quantity of water delivered.B. Records shall be maintained so that the quantity of water soldand the amount of revenue under each rate sche~ule shall be readil~available.
This account shall be subdivided at least as follows:
461.
461.
461.
461.
461.
Metered
MeteredMetered
Metered
Metered
Sales
Sal esSalesSalesSales
to Residential Customers
to Commercial Customers
to Industrial Customers
to Public Authorities
to Multiple Family Dwellings
Note
: - -
This account includes all revenues under serviceclassificat.ions which consist of a rate for a specified diameter
service pipe, or per meter , fixture, room , foot of frontage , orother similar unit, plus an additional charge or an adjustmentdependent upon the quanti ty of water delivered.
WATER OPERATING REVENUE ACCOUNTS
462. Fire Protection Revenue
Include herein all revenue from public agencies and others
tor hydrant charges , private fire protection service, streetsprinkling, sewer flushing and similar sources.
465. Sales to IrriGation Customers
A. This account shall include the net billing for water suppliedfor commercial irrigation purposes , under distinct irrigation ratesbilled under either metered or flat rate tariff schedules.B. Records shall be maintained so that the quantity (estimated ifnot metered) of water sold and the amount of revenue under each rateschedule shall be readily available.
, 466. Sales for Resale
A. This account shall include the net billing for water supplied(incl uding stand-by service) to other water utilities or to publicauthori ties for resale purposes.B. Records shall be maintained so that .the quantity (estimated ifnot metered) of water sold and the amount of revenue under each rateschedule shall be readily available.
Note
: - -
Where the contract is reciprocal, i. e., where either partythereto may take water from the other , the total amount receivablefor water supplied to ~he other party shall be included herein andthe total amount payable for water received from the other partyshall be ch~rged to account 610 - Purchased Water.
Other Water Revenues
469. Guaranteed Revenues
This account shall be credited with revenue received fromdevelopers or other persons for a period of time prior to waterservice being established. Normally, this type of revenue usually received to reserve or guarantee the availability of plantcapaci ty when needed.
474. Other Water Revenues
This account shall include revenues derived from water
operations not includible in any of the preceding accounts.
60l.
603.
604.
610.
615.
616.
618.
620.
630.
63l.
635.
636.
640.
650.
655.
665.
670.
675.
WATER OPERATION AND MAINTENANCE EXPENSE ACCOUNTS
Wages - Employees
Wages - Officers Directors and Maj ori tySalaries and
Salaries and
Stockholders
Employee Pensions and Benefits
Purchased Water
Purchased Power
Fuel for Power Production
Chemicals
Materials and Supplies
Contractual Services - Billing
Contractual Services - Professional
Contractual Services - Testing
Contractual Services - Other
Rents
Transportation Expenses
Insurance Expense
Regulatory Commission Expenses
Bad Debt Expense
Miscellaneous Expenses
WATER OPERATION AND MAINTENANCE EXPENSE ACCOUNTS
601. Salaries and WaGes - Employees
This account shall include the compensation (salaries
bonuses and other consideration of services) paid or accrued toemployees of the utility company for work .related to operation andmaintenance of that utility company.- This account shall not includethe salaries and wages of officers , directors or maj ori~ystockholders of the utility company"
603. Salaries and WaGes - Off icers. Directors and Mal ori tv Stockholders
This account shall include the compensation (salaries , bonusesand other consideration for services) paid or accrued to officers. directors or maj ority stockholders of the utili ty company"
604. Emplovee Pensions and Benefits
This account shall include all accruals under employee pensionplans 'to which the utility has irrevocably committed such funds
, andpayments for employee accident , sic~ness , hospital and deathbenefits .or insurance therefor. Include also expenses for medical,educational or recreational activities of employees"
610. .Purchased Water
A" This account shall include the cost at the point of delivery ofwater purchased for res~le.
B. . The records supporting ~his account shall be so kept
as to ~howfor each supplier from which water is purchased, point of delivery,quantity purchased , basis of charges , and the cost of waterpurchased
615. Purchased Power
This account shall include the cost of all electric powerexpense incurred by the utility.
616. Fuel For Power Production
A. This account shall include the cost of fuel used in theproduction of power to operate the pumps. Records shall bemaintained to show the quantity and cost of each type of fuel used.B. The cost of fuel shall be charged initially to appropriate fuelaccounts under account 151 - Plant Materials and Supplies, andcleared to this account on the basis of the fuel used.
WATER OPERATION AND MAINTENANCE EXPENSE ACCOUNTS
618. Chemicals
This account shall include the cost of all chemicals used in
the treat~ent of water. , Include also the cost except salaries andwages includible in accounts 600 - 603) of any chemicals
manufactured by t he utility and used to provide water services.
620. Materials and Supplies
This ac60unt shall include all materials and supplies used in
the operation and maintenance of the water system, other thanmaterials and supplies charged to account 636 - Contractual Services
- Other.
630. Contractual Services - Billinq
This accOunt shall include the costs associated with billing
customers for water service if such work is not performed byemployees of the utility.
631. Contractual Services - Professional
This account shall include the cost of accounting legal andengineering if such work is not performed by employees of theutility.
635: Contractual Services - Testinq
This account shall include costs paid to outside laboratoriesfor testing.
636. Contractual Service - Other
This account shall include the cost of operation andmaintenance work not performed by utility employees. This accountshall also include the cost of management and data processing
such work is not performed by employees of the utility.
640. Rents
This account shall include those costs associated with the
rental of buildings, real property and equipment , except for therental of automobiles and trucks which shall be included in account650 - Transportation Expense.
650. Transportat ion Exp~nses
This account shall include all truck automobileconstruction equipment, and other vehicle expense chargeable to
utility operations except depreciation and insurance.
WATER OPERATION AND MAINTENANCE EXPENSE ACCOUNTS
655. Insurance ExPense
This account shall include all insurance costs applicable tothe accounting period , including workman s compensation , liabili cy,vehicle, 'fire and theft or robbery insurance.
Note A:- - Insurance dividends and refunds shall be credi ted to thisaccount.
Note B:- -The cost of policies extending over a period of more thanone year shall be prorated over the period of coverage. Prep~idinsurance shall be charged to account 174 - Miscellaneous Currentand Accrued Assets.
665. Requlatorv Commission Expenses
This ac~ount shall include all ex~enses (except salaries regular utility employees) incurred by the utility in connectionwith formal cases before regulatory commissions. This account shallnot include payment of taxes which shall be reported in the taxesother than income account.
670. Bad Debt ExPense
This account shall be charged with amounts sufficient to
provide for losses from uncollectible utility revenues. Concurrentcredits shall be made to account 143.
675. Miscellaneous Expenses
This account shall include all expenses not includible in otheroperating expenses accounts.
10.
Items
Industry association dues for company memberships.Contributions for conventions and meetings of theindustry.
Communication service no~ chargeable to other accounts.Trustee , registrar, and transfer agent fees and expenses.Stockholders meeting expenses.Dividend and other financial not ices.Printing and -mailing dividend checks.Director's fees and expenses.
Publishing and distributing annual reports tostockholders.
Public notices of financial , operating and other datarequired by regulatory statutes , not including, however,notices required in connection wi th security issues oracquisi tion of property.
11.
WATER OPERATION AND MAINTENANCE EXPENSE ACCOUNTS
Write off of expenditures for preliminary surveys
I plans investigations I etc., included in account 183Preliminary Survey and Investigation Charges I relative toproj ects which have been abandoned.