ML19345A802
| ML19345A802 | |
| Person / Time | |
|---|---|
| Site: | Yankee Rowe |
| Issue date: | 04/07/1976 |
| From: | Soucy A YANKEE ATOMIC ELECTRIC CO. |
| To: | Office of Nuclear Reactor Regulation |
| References | |
| WYR-76-43, NUDOCS 8011250226 | |
| Download: ML19345A802 (11) | |
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WYR-76-43
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Telephen, 617 366-9011 TwX 710-390-0739 YANKEE ATOMIC ELECTRIC COMPANY d
20 Turnpske Road Westborough, Mossochusetts 01581
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U. S. L'uclear Aegulatory Cor: mission cp g/g Jf Washing't(o;1, D. C. 40545 04 N..
V Attention: Office o p uclear Reactor Regulation
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Gentle =en:
Enclosed is a copy of Yankee Atocic Electric Company's Certified Financial Statements for the year ended December 31, 1975.
This report is filed pursuant to the requirerents of 10 CFR 50.71.
Will you please acknowledge receipt of the above-=entioned report by signing and returning the enclosed post-card.
Very truly yours, YAhTEE ATOMIC ELECTRIC COMPANY
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A. R. Soucy Assistant Treasurer Enclosures s=m CC: KG i
8011250 ) N T
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i COOPERS & LY B R A N D CEmTirtED pueLsc ACCOUNTANTS IN palkCIPAb AREAS OF TMt. WCPLO Yankee Atomic Electric Company Westborough, Massachusetts We have examined the balance sheet of Yankee Atomic Electric Company as of December 31, 1975,. and the related state-ments of income and retained earnings and changes in financial position for the year then ended.
Our examination was made in accordance with generally accepted auditing standards and, accordingly, included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances.
We previously examined and reported upon the financial statements of the company for the year 1974
- In our opinion, the aforementioned financial statements present fairly the financial position of Yankee Atomic Electric Company at December 31, 1975 and 1974, and the.results of its-operations and the changes in its financial position for..the years then ended, in conformity with' generally accepted accounting prin-ciples applied on a consistent basis.
Boston, Massachusetts February 13, 1976 (except for Note E which is March 23, 1976) n
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h YANKEE ATOMIC BALAt December 31 ASSETS 1975 1974 Utility plant, at original cost (Note A)
$47,368,145 ' 846,038,3441 Less accumulated provision for depreciation 27,351,650
'25,146,413 Total net utility plant 20,016,495' 20,891,931-Huclear fuel (Note A):
In process of refinement, c on ve rs ion, enrichment and fabrication 3,847,945 6,085,844 '
~
Materials and assemblies in stock 65,681
. 65,681,
Assemblies in reactor 9,912,325 z9,021,013-
~,054,169 :
Spent nuclear fuel
-10,376,336 7
Gross nuclear fuel 124,202,287
- 22,226,7071 Less accumulated provision for amortization of nuclear fuel 8,594,255 =
7,I53,002 Net nuclear fuel 15,608;o32_' 14,873,705-Current assets:
.342,196 1395,664 Cash Accounts receivable:
.rrom sales o.f electric energy 11,944,098 1,809,7541 Other 912,564
.1,360,9161 General caterials-and-supplies,
-at average cost
.563,295 503,'858 Prepayments-275,710-
-293,922 Total current-assets 4,037,863 4,364,'114 Advance payment - nuclear fuel (Note c)-
1,331,250'
- 160,372
'!onutility-property, net
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Deferred charges _
21,959 18,987"
=$41,015,599 840,309,109-
-The accompanying ~notestare an ihti 2-
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9 ELECTRIC COMPANY
- CE SHEET December 31 STOOKHOLDERS' EQUITY AND LIABILITIES 1975 197?
S toc kholders ' equity (Note F):
Capital stock, par value $100 per share; 153,400 shares authorized and ou ts tanding
$ 15,340,000
$ 15,340,000 Retained earnings 5,195,800 5,206,284 20,535,800 20,546,284 Current liabilities:
Notes payable (Hote D) 16,400,000 12,000,000 Accrued federal income taxes 455,672 87,305 Accounts payable 660,447 4,731,420 Total current liabilities 17,516,119 16,818,725 Zeferred federal income taxes (Hote A) 2,676,560 2,775,300 Unamortized investment tax credits (Note A) 287,100 166,800 cc.Tr.itments and contingencies (Hotes A, E and F)
$41,015 5od SAO,_309,109 2
- gral part of these financial statetents.
6
YANKEE ATOMIC ELECTRIC COMPANY STATEMENT OF INCOME AND RETAINED EARNINGS Year Ended December 31, 1975 1974 operating revenue:
Sales of electric energy (1,193 million KWH in 1975 and 911 million KWH in-1974) (Note E)
$15,004,435 S12,285,448 operating expenses:
operation 3,940,892 3,390,491 Fuel, after deducting $167,133 in 1975 and $242,366 in 1974 for recoverable value of nuclear by-products (Note A) 2,955,808 2,679,354 Maintenance 1,604,755 1,353,983 Depreciation (Note A) 2,280,917 2,207,670 Taxes, other than federal income taxes 549,756 515,748 Federal income taxes (Note A) 1,187,600 706,927 Deferred federal income taxes '(Note A)
(98,720)
(333,800)
Investment tax credit adjustments (Note A) 118,300 88,300 Total operating expenses 12,539,308 10,608,673-operating income 2,465,127 1,676,775 Allowance for funds used during construction (Note A_)
23,419 32,151:
other, including related taxes - net (300)
(350)
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operating and'other income 2,488,246 1,708,576-Interest charges:
Interest en notes payable 1,003,036 1,094,913-other interest ~
44 26,263 Total interest' charges 1,003,080-
__?.,121,176 Net income, $9.68 and 33.83 per share
-1,485 166 587,400 Retained earnings at be' ginning of year
'5,206,,284-5.155,784-6,691,450 5,743,184
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Cash dividends declared, 39 75 and
$3.50 per share 1,495,650 536,900 Retained-earnings at end of year 8 5,'195,800 8 5,206,284 The-accompanying-notes _are an' integral part of these financial. s tatements.
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YANKEE ATOMIC ELECTRIC ' COMPANY STATEMENT OF CHANGES-IN. FINANCIAL POSITION Year Ended December 31, 1975 1974 Source of funds:
From operations:
Net income
. $ 1,485,166 8
587,400 Depreciation 2,280,917 2,207,670.
Amortization of nuclear fuel 2,955,808 2,679,800) 354-m Deferred federal income taxes (98,720):
(333, Deferred investment tax credit 118,300.
88,300 Other 12,743 20,702 6,7f4,214 5,249,626.
Net increase in notes payable 4,400,000 2,000,000
$11,154,214
$i7,249,6E6-Application of funds:
Additicns to plant
$ 1,405,482 '
S.2~453,902 Nuclear fuel purchased 3,690,133 5,872,496 Cash dividends
.1,495,650' 536,900, Reduction in long-term debt 930,000:-
Advance payment - nuclear fuel 1,331,250 Net increase (decrease) in working capital (excluding notes payable) 3,376,355
.(2,816,125).
Other (144,656)'
272,453
$11,154,214 3'7,249,626-Increase (decrease) in components of werking capital:
Cash-S' (53,468) 10;766.
Accounts receivable
.(314,008) 1,560/376' General materials and supplies 52,437
-11,000' Prepayments
. ~( 10,212 )
48,285-Accrued federal income taxes-
'(368,367) 49,388~
Accounts payable
-4,070,973-
. (4,4 95,940)-'
$_32_376,355 S(2,816,125)-
~The-accompanying-notes are an integralJ cpart :of these financial statements.
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YANKEE ATOMIC ELECTRIC COMPANY NOTES TO FINANCIAL STATEMENTS A.
Summary of Accounting Policies:
1.
Accounting System Prescribed The accounts of the Company are maintained in accordance.with the Uniform System of Accounts prescribed by the Federal Power Commission.
2.
Plant The Company capitalizes, as a part of construction costs, lui allowance for funds used during construction which approxi-mates the cost of funds.
The Company charges costs of current repairs and minor replacements of plant and properties to maintenance expense accounts as incurred.
Plant retired or otherwise disposed of, together with costs of removal less salvage, is charged to accumulated provision for depreciation, j
3 Depreciation The Company provides depreciation on a straight-line basis by charges which equal five percent (5%) of the cost of depreciable assets.
4 Kuclear Fuel The cos t of nuclear -fuel, reduced by the estimated ~ net realizable value of reusable nuclear - fuel and-recoverable plutonium by-product, is amortized and charged to fuel expense based on the estimated life of the nuclear core.
These amounts-are subject to fina1' determination when each nuclear core cycle has been completed.
5 Federal Income Tax In years prior to 1975, the Company computed depreciation.
utilizing liberalized-depreciation (declining-balance method)-
in determining deductions for federal income tax purposes only.
Beginning-in 1975, the Company: elected to utilize the.
class life system for tax reporting: purposes,; based upon,the straight-line. method for. assets acquired prior to-1971.
In
. years prior to 1968, amounts equal to reductions in federal income taxes attributable to the excess; of tax lover book depre-ciation were charged against. income and credited to accumulated-deferred. federal -income taxes; in 1974 ' and 1975, the latter account was charged and income ~cre'ited for the increase-in-federal income tax arising from tl.
rcversal of this timing difference.
' Continued.
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YANKEE ATOMIC ELECTRIC COMPANY NOTES TO FINANCIAL STATEMENTS, Continued A.
13ummary of Accounting Policies, continued:
6.
Investment Tax Credits Investment tax credits are deferred and amortized over the estimated lives of the property giving rise to the credits.
The investment tax credit adjustments account reflects reductions in federal income taxes attributable to such investment tax credits which have been deferred, less amortization of $12,300 in 1975 and $6,700 in 1974 7
Retirement Plan The olans in effect f or substantially all employees'are fund'ed plans and provide retirement benef1+.s,. principally fixed and variable annuities.
Unfunded prior. service costs-are estimated to be S947,000 at December 31, 1975 Prior service costs are being amortized over a 20-year period.
Total pension costs in 1975 and 1974, charged principally to operating expenses and billable services, were S363,900 and $222,37d, respectively, and-included the amortization of prior. service costs.
The increase in pension expens,e in 1975 resulted from a substantial increase in-the number of employees covered by the plan.
The market value of pension fund assets exceeded-the actuarially computed value of-ves ;ed benefits as of April 1, 1975, the latest valuation date.
3.
Nuclear Services Division:
The Company, an electric utility subs'idiary of two registered-holding companies, operates a Nuclear Services Division under.
the applicable rules and regulations of the1Public Utility Holding Company Act for the purpose of furnishing nuclear-engineering services, at the cost of such services,. to its sponsoring utilities and the organizations in which they may have a substantial financial or contractual interest. 1The cost of such services and the related billings therefor, -which amounted ~ to $7,123,982 in 1975 and $5,731,309 in.1974,1 are not
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a included in the accompanying ~ statement of -income _.and retained-earnings.
Continued 6-
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YANKEE ATOMIC ELECTRIC COMPANY NOTES TO FINANCL\\L STATEMENTS, Continued C.
Advance Payment - Nuclear Fuel:
On September 2, 1975 the Company made an advance-payment in the amount of $1,331,250 under an agreement to purchase uranium as yellowcake.
The agreement provides for delivery during the.
period June 10, 1977 to December 10, 1978 at a total-cost of S5,500,000.
D.
Short-Term Borrowing Arrangements:
Short-term debt outstanding at Decem'ber 31,-1975 is unsecured and has maturities ranging from 13 -to 62 days.
The Company has a bank line of credit totaling $17,500,000 the terms of
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which provide for borrowing at. the prime rate at the time of borrowing.
Information as to short-term borrowings for 1975 and 1974 is summarized as follows:
1975
- 1974, Amount outstanding at end of year:
$ - 2,000,000-Notes payable to banks
-Commercial paper
$16,400,000 10,000,000 Total
$16,400,000 ~$_12,000,000--
Weighted average interest rate at end of year 5 7/8%'
L 10.1/4%
. Maximum amount of borrcwings at any month.end _
$16,400,000 _$12,200,000 Weighted average -borrowings -
during year
~ $14,075,000 ' $10,325,000 -
Weighted average interest rate during year
- 7 13%
10.6%
E.
Pending Rate-Proceedings:
Effective-June 2, 1975 the Company--was permitted to. increase _.its-rates, subject to possiblel refund,1upon final ~ determination ~
. by. the Federal Powerf Commission.
Sales of electric energy: in 1975 include approximately 31,365,000 of-additional revenues-relatedito such.-rate _ increase which, after deduction of income:
taxes',- increased' net inccme by approximately. $710,000 in;1975 4
Continued 7;
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YANKEE ATOMIC ELECTRIC COMPANY NOTES TO FINANCIAL STATEMENTS, Continued i
E.
Pending Rate Proceedings, continued:
While witnesses for the Federal Power Commission (FPC) Staff 1-and certain intervenors have opposed the formula approach to billing revenue used by the Company, they have both. recommended overall returns which are comparable to the. Company's1 formula-apprr Currently, hearings have been completed on this I
issue and the parties are in the process of briefing the matter to the presiding Administrative Law Judge.
No other proposals on rate of return have been presented.
While the Company and its outside legal counsel are unable'to predict what the ultimate outcome of this matter will be, they 'coth regard it as very unlikely that the FPC will provide for an overall return that would fall substantially below the proposals made j
by the FPC Staff and the intervenors.
F.
Commitments:
Contractual obligations for the fabrication of nuclear-fuel
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assemblies amounted to approximately $1,700,000'at December 31, 1975 The' Company has contracted to. purchase quantities of uran'ium with delivery between June 1977 and December 1978 for $5,500,000 less $1,320,000 previously paid (see' Note C).
The Company's capital stock is owned by'11 investor-owned'
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l New England utilities.. The: entire' output of.its nuclear.generat-l ing plant is_ sold to said utilities in proportion to?their respective stock ownership and is: paid for on the. basis'of1their respective shares of total. fixed and operating expenses ofuthe-plant plus a return on-investment,-whetherLor not-the plant is operating.
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