The Governmental Accounting Standards Board Statement No. 83, Certain Asset Retirement Obligations requires public power companies and other governmental entities to identify and value asset retirement obligations. For periods after June 15, 2018, those entities must record a liability and corresponding deferred outflow of resources for the current value of outlays expected to be incurred for those tangible capital assets that the entity has a legal obligation to perform asset retirement activities.
Public power entities have the opportunity learn from the challenges that their investor-owned peers have faced doing their own ARO accounting. These challenges have included effectively managing the estimation process to meet the needs of operational members of the team who are key to inputs as well as accounting and control requirements for the financial reporting of the obligation.
PwC’s Complex Accounting & Regulatory Support Services (CARSS) practice is dedicated to helping regulated companies in the energy, power and utility industries manage their regulatory risk and help solve their complex accounting problems related to regulatory accounting. Our seasoned team has deep experience working with regulated entities and their regulators, and can help companies reduce risk and achieve optimal outcomes related to interactions with regulators.
US Energy Utilities and Mining Managing Director, PwC US