UTILITY FINANCE AND ACCOUNTING FOR  NON-FINANCIAL PROFESSIONALS

AND UTILITY FINANCE AND ACCOUNTING FOR ATTORNEYS

 

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CPE CREDIT for CPAs available for all States and CLE CREDIT for lawyers: available in most states

LEARNING OBJECTIVE:

To provide a working understanding of finance and accounting as applied to both the regulated utility and non-regulated companies (competitors, customers and the future utility company).

Upon completion of the seminar, participants will be able to:

• Understand accrual accounting




• “Read” an annual report of the company or its customers




• Calculate key financial ratios




• See the link between finance and accounting and the strategic plans of the company




• Understand how a utility makes money now and what needs to be done for the future




• Analyze whether shareholder value is being created as opposed to net income




• Do a capital budgeting analysis (engineering economics)

APPROACH:

Lecture and discussion with a note-taking outline provided to each participant. Extensive use of:

• A non-debit and credit approach




• Problem solving sessions




• Homework assignment




• Actual utility financial statements




• Interaction with other participants




• Group case work

OUTLINE OF THE SEMINAR 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

 

HOTEL AND CITY INFORMATION

BOSTON 

The Boston Seminar will be at the Omni  Parker House – 60 School Street,  Boston. We have reserved a block of sleeping rooms at the hotel for the nights of October 7-11.

Click link: Omni Parker House for a reservation

LAS VEGAS 

Golden Nugget
129 East Fremont Street
Las Vegas NV 89101

We have reserved a block of rooms at the hotels where the seminars will be held.  Book early. The block of rooms well be held open until a month before the seminar. This is an AAA four diamond hotel but we negotiated a low weekday rate. To get the group rate click on the link below or call (800) 634-3454 and give them the Group Code. You will probably want to make a reservation arriving the day before the seminar.

 

For our June 4-6 Seminar —  Room nights available June 3-7

Click link: Golden Nugget June  or call and give them this Group Code GSFAI01 (the I in this group code is the capital letter I and the 0 is zero)

 

For our Oct 15-17 Seminar —  Room nights Oct 14-18

Click link: Golden Nugget Oct 15-17 or call and give them this Group Code GSFAI02 (the I in this group code is the capital letter I and the 0 is zero)

 

If you are staying at the Golden Nugget hotel, the newer tower is the Rush Tower. In any case, when you check in you should ask for a room away from Fremont Street (which can be noisy at night.)

We will have a Continental Breakfast each morning and Lunch will be provided and we hope you can join us for cocktails after class the first day.

Class begins at 8 AM ends at 4 PM (except last day we end at 3).

Dress is casual but you could bring a sweater or jacket as the temperature in the meeting room may vary.

 

 

 

For a list of organizations who have sent people to our classes, look at our previous participant list.