Section 10. Adoption of revised uniform system of accounts for gas utilities

At the National Association of Regulatory and Utilities Commissioners' (NARUC) convention held in Phoenix, Arizona, on November 17-20, 1958, resolutions were adopted recommending to the commissions represented by membership in the Association the adoption of revised Uniform Systems of Accounts for Gas Utilities. This system of accounts was published and adopted by a number of state commissions, including this Commission.

Although there have been numerous changes in accounting principles and practices and although the Federal Power Commission has adopted numerous amendments to the systems of accounts that it prescribes for gas utilities, there have been no amendments to the NARUC system since it was issued in 1958.

Realizing the need to bring the NARUC system up-to-date, the NARUC Accounting Committee undertook a complete review of the presently recommended system of accounts. The review of the system of accounts has been completed by the Association's Committee on Accounts and Statistics, and the Committee's recommended revisions have resulted in adoption and recommendation of a new, revised system of accounts by the NARUC.

Also, this Commission is aware that the Federal Power Commission, by order No. 490 issued on August 22, 1973, has eliminated Account No. 271 - Contributions In Aid of Construction - and prescribed disposition of the balance in such account and the treatment of future contributions in aid of construction. This change was not included in the NARUC recommended revised system of accounts.

NOW, UPON CONSIDERATION, the Commission is of the opinion and finds:

1. That the system of accounts for gas utilities prescribed by this Commission should be revised to conform with the recommended revisions of the NARUC except in regard to Account No. 271. The Commission's prescribed treatment of contributions in aid of construction should be substantially the same as that of the Federal Power Commission;

2. That, however, the gas utilities under the jurisdiction of the Commission should continue to maintain the amounts of contributions in aid of construction on a memorandum basis for tax and other related purposes where such detail is needed;

3. That implementation of the revised system of accounts for gas utilities should become effective January 1, 1974, and the gas utilities should implement a memorandum record of contributions in aid of construction at that time; accordingly

IT IS ORDERED:

1. That the uniform system of accounts for gas utilities prescribed by the Commission, effective January 1, 1961, be discontinued and cancelled as of January 1, 1974;

2. That every gas utility company operating in this Commonwealth shall institute and place into effect a system of accounts in accordance with the rules and regulations set forth in the Uniform System of Accounts for Gas Utilities, Classes A and B, C or D as applicable to it, prepared by the Committee on Accounts and Statistics of the National Association of Regulatory and Utilities Commissioners and filed with this order marked respectively as "Uniform System of Accounts For Class A and B Gas Utilities," "Uniform System of Accounts For Class C Gas Utilities," and Uniform System of Accounts For Class D Gas Utilities," such system of accounts to become effective, except for Account No. 271 - Contributions in Aid of Construction;

3. That the Acting Chief Accountant to the Commission shall cause to be prepared a written directive setting forth treatment for contributions in aid of construction in substantial compliance with the ordering provisions of Federal Power Commission Order No. 490 and upon approval of such directive by the Commission, the same shall be forwarded to each gas utility and shall replace and supersede all prescribed treatment in the NARUC recommended system of accounts in conflict therewith; and, that the Acting Chief Accountant shall cause to be prepared as an addendum to the written directive, an instruction for the approval of the Commission, prescribing the memorandum record which shall be maintained for contributions in aid of construction for tax and other administrative purposes;

4. That effective January 1, 1974, every gas utility operating in this Commonwealth shall commence to keep its books and records in accordance with the system of accounts and the written directive for contributions in aid of construction filed herein;

5. That an attested copy of this order, together with, or as soon hereafter as available, the revised system of accounts and written directive and addendum of the Acting Chief Accountant, shall be sent to each gas utility operating in this Commonwealth.

Historical Notes

Derived from Administrative order, eff. December 27, 1973.

Statutory Authority

§§ 56-36, 56-249 and 56-249.2 of the Code of Virginia.