Utility Accounting Education Update
The latest in electric co-op and utility accounting, developing electric rates, and financial management
Asset Impairments and Regulatory Accounting
July, 2021
As you prepare your electric cooperative or utility budget for 2022, thoughts of cost recovery are front and center. The changing mix of power supply also raises the need for evaluation of assets for potential impairment. How to address these issues? Here are resources on impairment evaluation, using regulatory accounting to smooth electric rates, and evaluating reports to make rate decisions.
Asset Impairments and Rate Recovery | FASB | GASB | FERC
Power Plant Impairments - How do we figure out the amount and include it in customer electric rates?
As the power supply base of the power and utilities industry moves to more renewables, you might find some of your traditional supply assets are not economical. These uneconomical assets might be impaired for accounting purposes. How do you determine the amount of an impairment, and more importantly, determine how to recover an impairment loss in electric rates? We show you how.
5 compelling reasons your electric cooperative or electric utility should use regulatory accounting (ASC 980 or GASB 62)
Electric co-op and utility regulatory accounting under ASC 980, GASB 62, and FERC is your friend when it comes to events that cannot be recovered in customer rates. Events like unexpected major storms, increases in power costs, contributed assets, long-term pension obligations, and commodity mark-to-market gains or losses can impact current cash flows but not be collected from customers until a future rate change. Regulatory accounting will help structure the matching of expense recognition to rate recovery.
The UAES article library covers introductory and advanced electric co-op and utility accounting, electric ratemaking, and financial management. We include practical examples you can use now in your electric cooperative or utility!
Are you working hard but not meeting your goals? Here are some proven methods in Getting Things Done.
What is the “Quality” of Your 10,000 Steps per Day?
These analogies fit how individuals can approach their goals. Some strive purposefully; others let life happen or re-up the same goals over and over again, wondering why their overall goals remain unfulfilled. Here are some methods to help you focus on what’s important.
UAES online courses in using regulatory accounting to manage budgets and electric rates
Regulatory Accounting Insights - Courses 1 and 2
Rate recovery of the remaining debt service on impaired assets is made through regulatory accounting using FASB ASC 980 or GASB 62. This online, on-demand, CPE eligible course shows you how to implement regulatory accounting, use it in common situations for expense deferral or revenue recognition, and discontinue regulatory accounting if it is no longer possible to include the amounts in electric rates. The course includes journal entries, financial statement disclosures, and downloadable materials that you can plug right into your process!
Try out one of our courses for free!
Try a UAES course for free to find out how our library of online, on-demand courses can help expand your power and utilities knowledge, add value to your organization, and add to your career skills!
If you are a Board Member or new electric cooperative or utility employee, the UAES course - Electric Utility Ratemaking | Introduction to the Process | Board Member, Management, and New Employee Training - will give you insights into the steps that go into developing electric rates. You’ll see how the sausage is made, but stay at a very high level for an understand of the process without rolling up your sleeves and getting down into the details. If you are responsible for approving electric rates, provide inputs into an electric rate study, or just want an understanding of each area and some good questions to ask, then this course is for you! It’s online, on-demand, and eligible for continuing professional education credits.
Use the code: uaesfreerates
at the checkout and take the course!
Thank you for your support and interest in best practices in accounting, ratemaking, and financial management. The Power and Utilities Industry is the foundation for a successful society and vibrant economy! See you next month, or check us out anytime at:
UAES Teaches Power and Utilities Accounting, Ratemaking, and Financial Management
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