thereto may be made in lieu of resubmission in response to these requirements. Copies of material submitted by reference shall be made available to the staff and six additional copies thereof shall be furnished to the Chief, Pipeline and Producer Rate Division (Bureau of Natural Gas) to be available to interveners according to their needs, after their intervention has been permitted by the Commission.

(2) Item by reference for major rate increase. In addition to the material required to be submitted pursuant to paragraph (b)(3) of this section, the last FPC Form No. 2 of the natural gas company on file with the Commission shall be made an item by reference. In the event an FPC Form No. 2 for a later calendar year would otherwise be required to be filed with the Commission within 60 days from the end of the base period selected by the natural gas company for its rate increase filing, said FPC Form No. 2 shall be filed concurrently with the rate increase. There shall be furnished to the Chief, Pipeline and Producer Rate Division (Bureau of Natural Gas) with the rate increase filing, one copy of the FPC Form No. 2 to be available to staff and six additional copies to be available to interveners according to their needs after intervention has been approved by the Commission.

(3) Reliance on other data. If the natural gas company has relied on data other than those in Statements A through P in support of its rate increase, such other data, appropriately identified and designated as such and separately stated, shall be submitted in addition to the data required by Statements A to P, in accordance with the requirements of paragraphs (d) and (e) of this section and limited to the test period prescribed in paragraph (e)(2) of this section. Where such other data fails to comply with the requirements herein prescribed, it shall be subject to rejection and if not properly refiled at least 15 days prior to the effective date proposed for the rate filing it may not thereafter be introduced in evidence in the event the proposed rate filing is set for hearing.

(4) Rejection for noncompliance. Where the data submitted in compliance with paragraph (b) of this section do not comply with the requirements of the rules and regulations, the rate filing is subject to rejection.

(d) Form and number of copies-(1) Changes other than in rate level. Filings for changes other than in rate level shall comply with § 154.26.

(2) Change in executed service agreement. Agreements intended to effect a change or revision of an executed service agreement shall be in the form of a superseding executed service agreement only. Service agreements shall not contain any supplements, but may contain exhibits (stating contract demand, delivery points, delivery pressures, names of industrial customers of the distributor-customer, names of distributors with one named as agent where delivery to several distributors is effected at the same delivery point and well names) which may be separately superseded.

(3) Rate changes. Ten sets of the statements and of the additional information, if any, shall be submitted, each set securely bound in a cover.

(4) Format of statements and schedules. Amounts purporting to represent book data included in statements and schedules required to be prepared or submitted as part of the filing shall be reported in a separate column or columns. All adjustments to book amounts shall also be reported in a separate column or columns so that book amounts, adjustments thereto and adjusted amounts will be clearly disclosed.

(e) Scope and composition of material for major increase-(1) Preparation for hearing. A natural gas company filing for an increase in rates or charges shall be prepared to go forward at a hearing on reasonable notice on the data which have been submitted and sustain the burden of proof imposed by the Natural Gas Act of establishing that its proposed changes are just and reasonable and not unduly discriminatory or preferential. The Commission is desirous of avoiding delay in processing rate filings. To this end, the material relied on in the filing and supporting work papers

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should be of such composition, scope, and format that it could serve as the company's complete case-in-chief in the event the rate is suspended and the matter is set for hearing to commence on a date within six months from the date of filing. If the rate fixing adjustments presented are not in full accord with a prior Commission decision directly involving the filing company, the company shall include in its working papers alternate material which will reflect the effect of such prior decision. (For purpose of this provision, rate of return is not a rate fixing adjustment.)

(2) Base and test periods. (i) If the natural gas company has been in operation for 12 months at the time of the filing, the Statements A to M, inclusive, and O and P or, L through N inclusive, as appropriate, and supporting schedules, shall be based upon a test period which shall consist of a base period of 12 consecutive months of most recently available actual experience, adjusted for changes in revenues and costs which are known and are measurable with reasonable accuracy at the time of the filing, and which will become effective within nine months after the last month of available actual experience utilized in the filing, but in no event shall such test period extend more than nine months beyond the date of filing; Provided, however, That, for good cause shown, upon application of the natural gas company made to the Commission 30 days in advance of the rate filing, the Commission may allow reasonable deviation from the prescribed test period; Provided further, That the last day of the 12 months of actual experience shall not be more than four months prior to the date of filing the proposed change in rates and charges. The 12 months of experience shall be adjusted to eliminate nonrecurring items (except minor amounts), but this shall not preclude the filing company from including items which, on the basis of existing facts, it can show will be experienced or from including an appropriate normalizing adjustment, e.g., rate case expenses, in lieu of a nonrecurring item. If the natural gas company has had less than 12

months' experience, the test period may consist of 12 consecutive months ending not more than one year from filing date, provided, however, the adjustments are not included for occurrences anticipated after the one-year period.

(ii) Adjustments to experience, or estimates where 12 months' experience is not available, may include the amounts for facilities for which a permanent or temporary certificate has been granted, provided such facilities will be in service within the test period, but such adjustments or estimates shall not include any amounts for facilities in respect to which a certificate of public convenience and necessity must be obtained but which has not been issued at the date of filing, nor shall adjustments or estimates include any amounts for other facilities associated therewith. The bases and procedures, including the docket number of each such outstanding certificate and other significant data, used in the derivation of adjustments or estimates shall be submitted in sufficient detail on supporting schedules as to permit ready analysis of such adjustments or estimates.

(3) Joint facilities. If the natural gas company operates other departments in addition to the natural gas operations involved in the subject rate increase and has allocated to such natural gas operations any of its investment in joint or other department facilities and the operation, maintenance, depreciation costs or taxes associated therewith, it shall be shown on the statements required to be filed by this section, or the schedules in support thereof, the amounts so allocated together with the methods used in making such allocations: Provided That if such allocations are recorded in the natural gas company's books on the basis of current accounting procedures the submittal may be confined to a brief description of the methods followed.

(4) Working papers and supporting data. (i) In the Statements described in paragraph (f) of this section, certain items are designated as being included in working papers. There is to be furnished to the Chief, Pipeline

and Producer Rate Division (Bureau of Natural Gas) upon filing the rate increase, one set of working papers for use by the staff and six additional copies of such working papers to be available to intervenors according to their needs after intervention has been approved by the Commission.

(ii) The data in support of the proposed increased rates shall include the required particulars of book data, adjustments and other computations and information on which the company relies to justify the increased rates sought.

(iii) Any data or summaries included in the filing purporting to reflect the books of account shall be supported by accounting working papers, which papers shall set forth all necessary particulars from which an auditor may readily identify the book data included in the filing in separate columns and verify that such data are in agreement with the company's books of account. All statements, schedules, and working papers shall be prepared in accordance with the classifications provided in the Uniform System of Accounts. Working papers prepared in accordance with similar standards and disclosing full particulars properly crossreferenced to the filing and within themselves and indexed shall be available for staff examination in support of all adjustments, computations and other information included in the filing.

(iv) Any company filing for a rate increase shall be responsible for preparing prior to filing and maintaining work papers sufficient to support the filing. Any failure to produce promptly such working papers on request by an authorized representative of the Commission prior to Commission action on the filing shall be cause for rejection of the tendered filing in its entirety. In addition to the working paper support the following specific material related to the base period normally prepared by the filing company shall be available for staff verification and analysis, and a copy shall be furnished on request:

1. Copies of monthly financial reports prepared for management purposes.

2. Copies of accounting analyses of balance sheet accounts.

3. Complete trial balances of all the balance sheet accounts at the beginning and end of the 12 months of actual experience, and revenue and expense accounts for the 12 months of actual experience used for the filing.

4. Analyses of the various miscellaneous revenues and related expenses included in the submitted cost of service.

5. Analyses of surplus and capital surplus accounts.

(5) Representation of chief accounting officer. The filing shall include a narrative statement executed by the chief accounting officer or other authorized accounting representative of the filing company representing tnat the cost statements and supporting data submitted as a part of the filing, as well as working papers required herein, which purport to reflect the books of the company do, in fact, set forth the results shown by such books.

(6) Opinion of independent public accountants. The filing shall include an opinion obtained from independent public accountants showing that an independent examination of the book amounts and accounting adjustments of the filing company has been made and the results thereof for the base period.

(f) Description of statements. Description of Statements A through P and supporting schedules required to be filed pursuant to the directions set out in paragraph (b) (3) and (4) of this section.

Statement A-Overall cost of service. This statement shall summarize the overall gas utility cost of service (operation and maintenance expenses; depreciation, taxes, credits to cost of service and return) developed from the supporting statements described below.

Statement B-Overall cost of service. This statement shall summarize the overall gas utility rate base from the figures contained in Statement C, D, and E. The statement shall also include the claimed rate of return and shall show the application of the claimed rate of return to the overall rate base.

Statement C-Cost of plant. This statement shall show in summary form the amounts of gas utility plant classified by Accounts 101, 102, 103, 104, 105, 106, 107, and 117 as of the beginning of the 12 months of actual experience, the book additions and

reductions (in separate columns) during the 12 months, together with the book balances at the end of the 12-month period. In adjoining columns there shall be shown the claimed adjustments, if any, to the book balances and the total cost of plant. All adjustments shall be fully and clearly explained in the supporting material submitted.

The following schedules and additional material shall be submitted as part of Statement C:

Schedule C-1, in columnar form similar to Statement C showing for each of the above accounts the amounts by detailed plants prescribed by the Commission's Uniform System of Accounts for Natural Gas Companies (Part 201 of this chapter) with subtotals thereof by functional classifications, i.e. Intangible Plant, Manufactured Gas Production Plant, Natural Gas Production and Gathering Plant, Products Extraction Plant, Underground Storage Plant, Local Storage Plant, Transmission Plant, Distribution Plant and General Plant: Provided, however, That to the extent plant costs are not available by detailed plant accounts they may be shown by functional classifications.

Accounts 101, 105, and 106 shall be adjusted to exclude the cost of major items of plant, the retirement of which is expected by the end of the test period.

Account 107 shall be adjusted to exclude plant in process of construction which is not expected to be in service by the end of the test period.

Schedule C-2, showing major plant addition and retirement projects during the nine months after the last month of the base period, brief descriptions, approximate dates of operation or retirement from service and costs classified by functions.

Schedule C-3, which is to be part of the working papers showing monthly book balances, for each of the 12 months in the base period by functional classification and detailed by plant account. Provided, however, that to the extent plant costs are not available by detailed plant accounts they may be shown by functional classifications. In adjoining columns there shall be shown the effect of the test period adjustments shown in Schedule C-2 on the balance at the end of the base period to arrive at an adjusted balance as of the end of the nine-month adjustment period.

Schedule C-4, which is to be part of the working papers, summarizing the following with respect to the book changes in gas plant in service (Accounts 101 and 103) for the last calendar year of the operations of the Company or its predecessors and proposed adjustments to such account:

(a) Starting Balance.

(b) Major additions and retirements by work orders (small items grouped) including the following:

(i) Major completed work orders including number, description, and amount.

(ii) Month placed in service or retired from service.

(iii) Period of construction.

(iv) Cross reference to FPC certification showing docket number and the dates the certificate was issued and accepted.

(c) Other major transactions recorded such as corrections, transfers, etc. Show sufficient detail so that the nature of the major changes will be clearly disclosed. (d) Closing Balance.

Schedule C-5, showing in respect of Accounts 106 and 107, at the end of the 12 months of actual experience a list of uncompleted work orders (small items grouped) claimed in the rate base, giving the work order number, docket number, description and amount of each and the amounts of each type of undistributed construction overheads. As part of the working papers include: a main-line map showing all major projects completed during the base period, with a key system indicating major work orders included in each project and reference to FPC certificate numbers; a list of principal projects certificated by FPC (including temporary certificates for the last five calendar years, ending during the 12 months of actual experience), setting forth the actual or estimated cost of the facility and indicating the total increase in contract demand and annual volumes associated with each major certificate.

Schedule C-6, which material may be contained in Company's FPC Form No. 2, and cross-referenced if such report is up to date, giving details of each storage project owned, showing cost by major functions, and base top gas storage volumes for the test period and for the 12 months of actual experience also making reference to any special rate schedules relating thereto, with monthly volumes and associated dollars for the inputs and outputs for the 12 months of actual experience.

Schedule C-7, which is to be part of the working papers, if company produces gas, a map, showing counties in the United States for such producing acreage.

Schedule C-8, which material may be cross-referenced from Company's FPC Form No. 2, summary by producing areas of gas reserves owned and a complete explanation of methods and procedures used in amortizing capitalized well costs.

Schedule C-9, which is to be part of the working papers, summarizing at end of period the cost of gathering facilities by major producing areas and by major type of plant.

Schedule C-10, which is to be part of the working papers, giving full details including docket number of any acquisitions of gas in place, other than acquisition of leasehold interests for the calendar years since the last rate filing, but not to exceed 5 years.

Schedule C-11, which is to be part of the working papers, summary cost of plant in service for each gasoline extraction and major purification (CO2) plant owned or operated by the company.

Schedule C-12, which is to be part of the working papers, a complete statement of methods and procedures followed in capitalizing interest during construction and other construction overheads, only if a change in such methods and procedures has been made since the end of the year reported in the company's last FPC Form No. 2.

Schedule C-13, which is to be part of the working papers showing any significant changes in intangible plant since the end of the year reported in the company's last FPC Form No. 2.

Schedule C-14, which is to be part of the working papers, setting forth the cost of plant in service and description thereof carried on the company's books as gas utility plant which was not being used in rendering gas service, only if there is a significant change in such amounts since the end of the year reported in the company's last FPC Form No. 2.

Schedule C-15, which is to be part of the working papers, setting forth any operating units or systems acquired for which Commission approval of the final accounting has not been obtained, the proposed journal entries to record the acquisition, and the proposed disposition of any difference between cost of acquisition and net original cost, only if there is a significant change in such amounts since the end of the year reported in the company's last FPC Form No. 2.

Statement D-Accumulated provisions for depreciation, depletion, amortization, and abandonment. This statement shall show the accumulated provisions for depreciation, depletion, amortization, and abandonment (Accounts 108 [detailed by functional plant classification], 111), as of the beginning of the 12 months of actual experience, the book additions and reductions during the 12 months, together with the balances at the end of the 12-month period. In adjoining columns there shall be shown adjustments to these ending book balances and the total adjusted balances.

The following schedules and additional material shall be submitted as part of Statement D:

Schedule D-1, which is to be part of the working papers showing monthly book balances, for each of the 12 months in the base period by functional plant classification. In adjoining columns there shall be shown the

effect of the adjustments shown in Schedule D on the balances at the end of the base period to arrive at adjusted balances as of the end of the nine-month adjustment period.

Schedule D-2, which is to be part of the working papers and may be cross-referenced from Company's FPC Form No. 2 summarizing the following by years with respect to the book changes in each account set forth in Statement D since the date of the last prior staff review, and proposed adjustments to such accounts.

(a) Starting balance. (b) Annual provision.

(c) Retirements (with cross-reference to plant schedule).

(d) Salvage.

(e) Removal costs.

(f) Adjustments (including particulars of any significant items).

(g) Ending balance.

Schedule D-3, which is to be part of the working papers, a description of the methods and procedures followed in depreciating. depleting, or amortizing plant and recording abandonments by the company if any policy change has been made effective since the period covered by the last annual report on FPC Form No. 2 was filed with the Commission.

Schedule D-4, with respect to each allocation of an overall account to obtain the amounts applicable to various functional groups of plant, a complete explanation of the method, procedures and significant data used in making the allocation.

Statement E-Working Capital. This statement shall show the computation of the working capital claimed as a part of the gas utility rate base. The statement shall show the respective components of the claimed working capital and be in such detail as to show how the amount of each component was computed.

The components of working capital may include (a) an amount equivalent to oneeighth of annual operating expenses, as adjusted, exclusive of the cost of gas purchased for resale; fuel gas charged to operating expenses; royalty payments on gas produced; transmission and compression of gas by others; royalty payments on products extracted; products purchased for resale; net of exchanged gas; and noncash operating expenses such as depreciation transferred through clearing accounts to operating expenses; and (b) an allowance for the average of 13 monthly balances of materials and supplies, prepayments, the unrecovered portion of advances to suppliers in Account 166 made under contracts executed prior to 10:49 A.M. E.S.T. on December 31, 1975, and gas for current delivery from underground storage. Any working capital item claimed which is different from or in addition to