Accounting for Infrastructure Regulation: An Introduction
World Bank Publications, 2008 - Business & Economics - 222 pages
This title provides a practical guide for regulators, policy-makers, and utility managers for establishing regulatory accounts that can be the cornerstone for better, more complete, and more reliable information. It sets out the essential accounting features of regulatory accounts and provides practical guidance on controversial areas such as cost allocation, asset valuation, and depreciation. It emphasizes the essential requirements for consistency with Generally Accepted Accounting Principles (GAAP).
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accepted accounting principles accounting information activity-based costing allocative efﬁciency analysis approach audit balance sheet basis beneﬁts capital expenditure cash ﬂow chapter chart of accounts classiﬁcation common costs company’s competitive concession concession contract cost accounting cost allocation cost objectives cost of capital cost pools decisions deﬁned deﬁnition depreciation proﬁles distribution Distribution Business economic electricity entity equity example expenses ﬁgure ﬁnancial statements ﬁrm ﬁrm’s ﬁrst historical cost I I C I I C incentives income income statement indirect costs inefﬁcient inﬂuence investment liabilities market value methodology net present value Ofwat operator’s privatization productive efﬁciency proﬁt RAGs rate of return ratio reﬂect regu regulated company regulated operator regulator needs regulatory accounting guidelines Regulatory Accounting Statement regulatory asset base regulatory objectives regulatory regime related parties related-party transactions requirements revenue sector shareholders speciﬁc statutory accounts tariff tion Total unregulated activities users utility valuation xxxxx xxxxx Rural xxxxx xxxxx xxxxx
Page 93 - And in order to ascertain that value, the original cost of construction, the amount expended in permanent improvements, the amount and market value of its bonds and stock, the present as compared with the original cost of construction, the probable earning capacity of the property under particular rates prescribed by statute, and the sum required to meet operating expenses, are all matters for consideration and are to be given such weight as may be just and right in each case.
Page 93 - Its bonds and stock, the present as compared with the original cost of construction, the probable earning capacity of the property under particular rates prescribed by statute, and the sum required to meet operating expenses, are all matters for consideration, and are to be given such weight as may be just and right In each case. We do not say that there may not be other matters to be regarded in estimating the value of the property. What the company is entitled to ask is a fair return upon the value...
Page 6 - Financial reporting should provide information that is useful to present and potential investors and creditors and other users in making rational investment, credit, and similar decisions. The information should be comprehensible to those who have a reasonable understanding of business and economic activities and are willing to study the information with reasonable diligence.
Page 6 - Financial reporting should provide information about the economic resources of an enterprise, the claims to those resources (obligations of the enterprise to transfer resources to other entities and owners' equity), and the effects of transactions, events, and circumstances that change its resources and claims to those resources.
Page 6 - Financial reporting should provide information to help present and potential investors and creditors and other users in assessing the amounts, timing and uncertainty of prospective cash receipts from dividends or interest and the proceeds from the sale, redemption, or maturity of securities or loans. Since investors...
Page 6 - Since investors' and creditors' cash flows are related to enterprise cash flows, financial reporting should provide information to help investors, creditors, and others assess the amounts, timing, and uncertainty of prospective net cash inflows to the related enterprise. . Financial reporting should provide information about the economic resources of an enterprise, the claims to those resources (obligations of the enterprise to transfer resources to other entities and owners...
Page 28 - Management accounting is the process of identification, measurement, accumulation, analysis, preparation, interpretation, and communication of financial information used by management to plan, evaluate, and control within an organization and to assure appropriate use of and accountability for its resources.
Page 50 - In basic accounting terms, a sunk cost is a cost that has already been incurred and that cannot be changed by any decision made now or in the future.
Page 109 - ... one party has influence over the financial and operating policies of the other party to an extent that that other party might be inhibited from pursuing at all times its own separate interests...