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7. Compensation paid while incapacitated C. There shall be credited to this acas the result of occupational injuries. (See count the portion of pensions and Note A.)

benefits expenses which is applicable 8. Cost of safety, accident prevention and to nonutility operations or which is similar educational activities.

charged to construction unless such NOTE A: Payments to or in behalf of em. amounts are distributed directly to the ployees for accident or death benefits, hos accounts involved and are not included pital expenses, medical supplies or for sala herein in the first instance. ries while incapacitated for service or on D. Records in support of this acleave of absence beyond periods normally count shall be so kept that the total allowed, when not the result of occupational injuries, shall be charged to account 926,

pensions expense, the total benefits

expense, the administrative expenses Employee Pensions and Benefits. (See also Note B of account 926.)

included herein, and the amounts of

pensions and benefits expenses transNOTE B: The cost of injuries and damages

ferred to construction or other acor reserve accruals capitalized shall be

counts will be readily available. charged to construction directly or by transfer to construction work orders from this ac

ZTEMS count.

1. Payment of pensions under a nonac. NOTE C: Exclude herefrom the time and

crual or nonfunded basis. expenses of employees (except those en

2. Accruals for or payments to pension gaged in injuries and damages activities)

funds or to insurance companies for pension spent in attendance at safety and accident

purposes. prevention educational meetings, if occur.

3. Group and life insurance premiums ring during the regular work period.

(credit dividends received). NOTE D: The cost of labor and related sup 4. Payments for medical and hospital servplies and expenses of administrative and ices and expenses of employees when not general employees, who are only incidental. the result of occupational injuries. ly engaged in injuries and damages activi. 5. Payments for accident, sickness, hospities, may be included in accounts 920 and tal, and death benefits or insurance. 921, as appropriate.

6. Payments to employees incapacitated

for service or on leave of absence beyond pe926 Employee pensions and benefits. riods normally allowed, when not the result A. This account shall include pen

of occupational injuries, or in excess of stat

utory awards. sions paid to or on behalf of retired

7. Expenses in connection with educationemployees, or accruals to provide for al and recreational activities for the benefit pensions, or payments for the pur of employees. chase of annuities for this purpose,

NOTE A: The cost of labor and related supwhen the utility has definitely, by con

plies and expenses of administrative and tract, committed itself to a pension

general employees who are only incidentally plan under which the pension funds engaged in employee pension and benefit acare irrevocably devoted to pension tivities, may be included in accounts 920 and purposes, and payments for employee 921, as appropriate. accident, sickness, hospital, and death

NOTE B: Salaries paid to employees during benefits, or insurance therefor. In

periods of nonoccupational sickness may be clude, also, expenses incurred in medi charged to the appropriate labor account cal, educational or recreational activi. rather than to employee benefits. ties for the benefit of employees, and administrative expenses in connection 927 Franchise requirements. with employee pensions and benefits. A. This account shall include pay

B. The utility shall maintain a com- ments to municipal or other governplete record of accruals or payments mental authorities, and the cost of for pensions and be prepared to fur. materials, supplies and services furnish full information to the Commis- nished such authorities without reimsion of the plan under which it has bursement in compliance with fran. created or proposes to create a pension chise, ordinance, or similar requirefund and a copy of the declaration of ments; provided, however, that the trust or resolution under which the utility may charge to this account at pension plan is established.

regular tariff rates, instead of cost, 231

utility service furnished without charge under provisions of franchises.

B. When no direct outlay is involved, concurrent credit for such charges shall be made to account 929, Duplicate Charges-Cr.

C. The account shall be maintained so as to readily reflect the amounts of cash outlays, utility service supplied without charge, and other items furnished without charge.

NOTE A: Franchise taxes shall not be charged to this account but to account 408.1, Taxes Other Than Income Taxes, Utility Operating Income.

NOTE B: Any amount paid as initial consideration for a franchise running for more than one year shall be charged to account 302, Franchises and Consents.

3. All application fees except those involving construction certificate applications which have been approved. (See Gas Plant Instruction 16.)

NOTE A: Exclude from this account and include in other appropriate operating expense accounts, expenses incurred in the improvement of service, additional inspection, or rendering reports, which are made necessary by the rules and regulations, or orders, of regulatory bodies.

NOTE B: Do not include in this account amounts includible in account 302, Franchises and Consents, account 181, Unamortized Debt Expense, or account 214, Capital Stock Expense.

929 Duplicate charges-Credit.

This account shall include concurrent credits for charges which may be made to operating expenses or to other accounts for the use of utility service from its own supply. Include, also, offsetting credits for any other charges made to operating expenses for which there is no direct money outlay.

930.1 General advertising expenses.

This account shall include the cost of labor, materials used, and expenses incurred in advertising and related activities, the cost of which by their content and purpose are not provided for elsewhere.

928 Regulatory commission expenses.

A. This account shall include all expenses (except pay of regular employees only incidentally engaged in such work) properly includible in utility operating expenses, incurred by the util. ity in connection with formal cases before regulatory commissions, or other regulatory bodies, or cases in which such a body is a party, including payments made to a regulatory commission for fees assessed against the utility for pay and expenses of such commission, its officers, agents, and employees.

B. Amounts of regulatory commission expenses which by approval or direction of the Commission are to be spread over future periods shall be charged to account 186, Miscellaneous Deferred Debits, and amortized by charges to this account.

C. The utility shall be prepared to show the cost of each formal case.

ITEMS 1. Salaries, fees, retainers, and expenses of counsel, solicitors, attorneys, accountants, engineers, clerks, attendants, witnesses, and others engaged in the prosecution of, or de fense against petitions or complaints presented to regulatory bodies, or in the valuation of property owned or used by the utility in connection with such cases.

2. Office supplies and expenses, payments to public service or other regulatory commissions, stationery and printing, traveling expenses, and other expenses incurred directly in connection with formal cases before regulatory commissions.

ITEMS Labor:

1. Supervision.

2. Preparing advertising material for newspapers, periodicals, billboards, etc., and preparing or conducting motion pictures, radio and television programs.

3. Preparing booklets, bulletins, etc., used in direct mail advertising.

4. Preparing window and other displays. 5. Clerical and stenographic work.

6. Investigating and employing advertising agencies, selecting media and conducting negotiations in connection with the placement and subject matter of advertising. Materials and expenses:

7. Advertising in newspapers, periodicals, billboards, radio, etc.

8. Advertising matter such as posters, bul. letins, booklets and related items.

9. Fees and expenses of advertising agencies and commercial artists.

10. Postage and direct mail advertising.

12. Public notices of financial, operating, 11. Printing of booklets, dodgers, bulle and other data required by regulatory stattins, etc.

utes, not including, however, notices re12. Supplies and expenses in preparing ad- quired in connection with security issues or vertising materials.

acquisitions of property. 13. Office supplies and expenses. NOTE A: Properly includible in this ac

931 Rents. count is the cost of advertising activities This account shall include rents on a local or national basis of a goodwill or

properly includible in utility operating institutional nature, which is primarily designed to improve the image of the utility or

expenses for the property of others the industry, including advertisements

used, occupied, or operated in connecwhich inform the public concerning matters tion with the customer accounts, cusaffecting the company's operations, such as, tomer service and informational, sales, the cost of providing service, the company's

and general and administrative funcefforts to improve the quality of service, the

tions of the utility. (See operating excompany's efforts to improve and protect the environment, etc. Entries relating to ad

pense instruction 3.) vertising included in this account shall contain or refer to supporting documents which

Maintenance identify the specific advertising message. If references are used, copies of the advertis- 932 Maintenance of general plant. ing message shall be readily available.

A. This account shall include the NOTE B: Exclude from this account and in- cost assignable to customer accounts, clude in account 426.4. Expenditures for sales and administrative and general Certain Civic, Political and Related Activi.

functions of labor, materials used and ties, expenses for advertising activities, which are designed to solicit public support

expenses incurred in the maintenance or the support of public officials in matters of property, the book cost of which is of a political nature.

includible in account 390, Structures

and Improvements, account 391, 930.2 Miscellaneous general expenses.

Office Furniture and Equipment, ac

count 397, Communication Equipment, This account shall include the cost and account 398, Miscellaneous Equipof labor and expenses incurred in con ment. (See operating expense instrucnection with the general management of the utility not provided for else

B. Maintenance expenses on office where.

furniture and equipment used else

where than in general, commercial ITEMS

and sales offices shall be charged to Labor:

the following accounts: 1. Miscellaneous labor not elsewhere provided for:

Manufactured Gas Production, account

708, 742. Expenses: 2. Industry Association dues for company

Natural Gas Production and Gathering.

account 769. memberships. 3. Contributions for conventions and

Natural Gas Products Extraction, account meetings of the industry.

791. 4. Research, development, and demonstra

Underground Storage, account 837. tion expenses not charged to other oper Local Storage, account 846. ation and maintenance expense accounts on Transmission Expenses, account 867. a functional basis.

Distribution Expenses, account 894. 5. Communication service not chargeable Merchandise and Jobbing, account 416. to other accounts.

Garages, Shops, etc., appropriate clearing 6. Trustee, registrar, and transfer agent

account, if used. fees and expenses. 7. Stockholders meeting expenses.

NOTE: Maintenance of plant included in 8. Dividend and other financial notices. other general equipment accounts shall be 9. Printing and mailing dividend checks. included herein unless charged to clearing 10. Directors' fees and expenses.

accounts or to the particular functional 11. Publishing and distributing annual re maintenance expense account indicated by ports to stockholders.

the use of the equipment.

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Source: Order 227, 25 FR 13161, Dec. 21, 1960, as amended by Order 276, 28 FR 14267, Dec. 25, 1963; Order 318, 31 FR 3392, Mar. 4, 1966; Order 320, 31 FR 5690, Apr. 13, 1966; Order 325, 31 FR 10605, Aug. 9, 1966; 31 FR 12840, Oct. 1, 1966; Order 366, 33 FR 10137, July 16, 1968; Order 419, 36 FR 530, Jan. 14, 1971; Order 420, 36 FR 515, Jan. 14, 1971; Order 426, 36 FR 5048, Mar. 17, 1971; Order 432, 36 FR 8241, May 1, 1971; Order 434, 36 FR 11432, June 12, 1971; Order 439, 36 FR 20871, Oct. 30, 1971; Order 440, 36 FR 21966, Nov. 18, 1971; Order 440-A, 37 FR 603, Jan. 14, 1972; Order 457, 37 FR 16798, Aug. 19, 1972; Order 460, 37 FR 24661, Nov. 18, 1972; Order 466, 38 FR 1585, Jan. 16, 1973; Order 467A, 38 FR 2173, Jan. 22, 1973; Order 473, 38 FR 4952, Feb. 23, 1972; Order 477, 38 FR 7215, Mar. 19, 1973; Order 490, 38 FR 23335, Aug. 29, 1973; Order 486–1, 38 FR 30435, Nov. 5, 1973; Order 473, 39 FR 2470, Jan. 22, 1974; Order 504, 39 FR 6087, Feb. 19, 1974; Order 505, 39 FR 6103, Feb. 19, 1974; Order 505, 39 FR 22418, June 24, 1974; Order No. 530, 40 FR 26989, June 26, 1975; Order 549, 41 FR 24997, June 22, 1976; Order 561, 42 FR 9165, Feb. 15, 1977; Order 567, 42 FR 30616, June 16, 1977.



When used in this system of accounts:

1. “Accounts” means the accounts prescribed in this system of accounts.

2. “Actually issued,” as applied to securities issued or assumed by the utility, means those which have been sold to bona fide purchasers for a valuable consideration, those issued as dividends On Stock and those which have been issued in accordance with con

tractual requirements direct to trustees of sinking funds. 3. “Actually outstanding,” as applied to Securities issued or assumed by the utility, means those which have been actually issued and are neither retired nor held by or for the utility; provided, however, that securities held by trustees shall be considered as actually outstanding. 4. “Amortization” means the gradual extinguishment of an amount in an account by distributing such amount over a fixed period, over the life of the asset or liability to which it applies, or over the period during which it is anticipated the benefit will be realized. 5. A. “Associated companies” means companies or persons that, directly or indirectly, through one or more intermediaries, control, or are controlled by, or are under common control with, the accounting company. B. “Control” (including the terms “controlling,” “controlled by,” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a company, whether such power is exercised through one or more intermediary companies, or alone, or in conjunction with, or purSuant to an agreement, and whether such power is established through a majority or minority ownership or voting of securities, common directors, officers, or stockholders, voting trusts, holding trust, associated companies, COntract Or any other direct or indirect In eans. 6. “Book cost” means the amount at which property is recorded in these accounts without deduction of related provisions for accrued depreciation, depletion, amortization, or for other purpoSeS. 7. “Commission” means the Federal POWer Commission. 8. “Cost” means the amount of money actually paid for property or services. When the consideration given is other than cash in a purchase and sale transaction, as distinguished from a transaction involving the issuance of common stock in a merger or a pooling of interest, the value of such consideration shall be determined on a cash basis. 9. “Cost of removal” means the cost of demolishing, dismantling, tearing down or otherwise removing gas plant, including the cost of transportation and handling incidental thereto. 10. “Debt expense” means all expenses in connection with the issuance and initial sale of evidences of debt, such as fees for drafting mortgages and trust deeds; fees and taxes for issuing or recording evidences of debt; cost of engraving and printing bonds and certificates of indebtedness; fees paid trustees; specific costs of obtaining governmental authority; fees for legal services; fees and commissions paid underwriters, brokers, and salesmen for marketing such evidences of debt; fees and expenses of listing on exchanges; and other like costs. 11a. “Depletion,” as applied to natural gas producing land and land rights, means the loss in Service Value incurred in connection with the exhaustion of the natural resource in the course of service. 11b. “Depreciation,” as applied to depreciable gas plant, means the loss in service value not restored by current maintenance, incurred in connection with the consumption or prospective retirement of gas plant in the course of service from causes which are known to be in current operation and against which the utility is not protected by insurance. Among the causes to be given consideration are wear and tear, decay, action of the elements, inadequacy, obsolescence, changes in the art, changes in demand and requirements of public authorities, and, in the case of natural gas companies, the exhaustion of natural resources. 12. “Discount” as applied to the securities issued or assumed by the utility, means the excess of the par (stated value of no-par stocks) or face value of the securities plus interest or dividends accrued at the date of the sale over the cash value of the consideration received from their sale. 13. “Investment advances” means advances, represented by notes or by book accounts only, with respect to which it is mutually agreed or intend

ed between the creditor and debtor that they shall be settled by the issuance of Securities or shall not be subject to current Settlement. 14. “Minor items of property” means the associated parts or items of which retirement units are composed. 15. “Natural gas” means either natural gas unmixed, or any mixture of natural and artificial gas. 16. “Natural gas company” means a person engaged in the transportation of natural gas in interstate commerce, or the sale in interstate commerce of such gas for resale. 17. “Net Salvage value” means the salvage value of property retired less the cost of removal. 18. “Nominally issued,” as applied to Securities issued or assumed by the utility, means those which have been signed, certified, or otherwise executed, and placed with the proper officer for sale and delivery, or pledged, or Otherwise placed in some special fund of the utility, but which have not been sold, or issued direct to trustees of sinking funds in accordance with contractual requirements. 19. “Nominally outstanding,” as applied to securities issued or assumed by the utility, means those which, after being actually issued, have been reacquired by or for the utility under circumstances which require them to be considered as held alive and not retired: Provided, however, That securities held by trustees shall be considered as actually outstanding. 20. “Original cost,” as applied to gas plant, means the cost of such property to the person first devoting it to public Service. 21. “Person” means an individual, a corporation, a partnership, an association, a joint stock company, a business trust, or any organized group of persons, whether incorporated or not, or any receiver or trustee. 22. “Premium,” as applied to securities issued or assumed by the utility, means the excess of the cash value of the consideration received from their Sale over the sum of their par (stated Value of no-par stocks) or face value and interest or dividends accrued at the date of sale.

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