OUTLINE OF THE WEBINAR TOPICS:
Introduction
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Basic Accounting Concepts
– Balance Sheet
– Income Statement
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Financial Statement Analysis
– Return on Equity
– Total Shareholder Return
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The Utility’s Four Sets of “Books”
– GAAP, Tax, Rates, Managerial
– Cost of Service Regulation
– Rate Base, Operating Expenses, Allowed Return
– Above-the-line versus and Below-the-Line Expenses
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Mock Rate Case
– Advertising
– Take or Pay Contracts
Ethics Considerations
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Modifications to Rate of Return Regulation
– Adjustment Clauses, Trackers, Riders, Deferrals
– Rate Freezes, Decoupling
– Pre-approvals
– Formula Ratemaking
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Present Value Analysis
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Shareholder Value
– Theory
– Income versus Shareholder Value Maximization
– Risk Considerations
– How to Make Decisions
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Accounting for Utility Plant
– Straight Line Depreciation
– Accelerated Depreciation
– Capitalization Versus Expense
– Methods of Capitalizing More or Less
– Which is Better for the Utility
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Income Taxes
– Temporary Differences
– Deferred Taxes (Normalization)
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Cost of Capital
– Weighted Average Cost of Capital
– Risk Premium Approach
– Discounted Cash Flow (DCF) Method
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Capital Project Analysis Review Case
– Cash Flow as affected by Taxes & Rate Regulation
– Which Discount Rate to Use
– Creating Shareholder Value
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Conclusions