FERC Filings

COMMENTS OF THE ELECTRIC POWER SUPPLY ASSOCIATION ON ACCOUNTING AND REPORTING OF FINANCIAL INSTRUMENTS, COMPREHENSIVE INCOME, DERIVATIVE AND HEDGING ACTIVITIES

CONCLUSION

While recent events have put the focus on accounting practices in the energy industry and elsewhere, the proposals in the NOPR that would deviate from longstanding Commission precedent are not the proper course of action. Rather than imposing additional reporting or prior approval requirements on marketers and independent generators with market-based rate authority, the Commission should encourage the development and implementation of sound risk management procedures and internal controls. Thus, the Commission should use its expertise in energy industries in working with Congress, the SEC and the CFTC on these issues. If the Commission believes that additional accounting and reporting requirements are needed to ensure just and reasonable rates, EPSA believes that the Commission should hold a technical conference in order to gain a better understanding of the accounting and financial risk management practices of entities in competitive markets and the relationship to the Commission’s mandate to ensure just and reasonable ratemaking. To date, the Commission has not adequately explained this relationship and thus the need for changing its longstanding precedent.

March 11, 2002

Respectfully submitted,

/S/___________________________
Julie Simon, Vice President of Policy
Jack Cashin, Senior Manager of Policy
ELECTRIC POWER SUPPLY ASSOCIATION
1401 New York Avenue, NW, 11th Floor
Washington, DC 20005
202-628-8200

• View Previous Section
• View Next Section
• Back to Issue Menu