PG&E 2009 Annual Report Download - page 67

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Accumulated other comprehensive income (loss) reports a measure for accumulated changes in equity of an enterprise
that result from transactions and other economic events, other than transactions with shareholders. The following table
sets forth the after-tax changes in each component of accumulated other comprehensive income (loss):
Employee Benefit Plans –
Accumulated Other
Comprehensive Income (Loss)
Balance at December 31, 2006 $ (19)
Period change in pension benefits and other benefits:
Unrecognized prior service cost (net of income tax expense of $18 million) 26
Unrecognized net gain (net of income tax expense of $195 million) 289
Unrecognized net transition obligation (net of income tax expense of $11 million) 16
Transfer to regulatory account (net of income tax benefit of $207 million)(1) (302)
Balance at December 31, 2007 $10
Period change in pension benefits and other benefits:
Unrecognized prior service cost (net of income tax expense of $27 million) 37
Unrecognized net loss (net of income tax benefit of $1,088 million) (1,583)
Unrecognized net transition obligation (net of income tax expense of $11 million) 15
Transfer to regulatory account (net of income tax expense of $894 million)(1) 1,300
Balance at December 31, 2008 $ (221)
Period change in pension benefits and other benefits:
Unrecognized prior service cost (net of income tax benefit of $1 million) (1)
Unrecognized net gain (net of income tax expense of $216 million) 363
Unrecognized net transition obligation (net of income tax expense of $11 million) 15
Transfer to regulatory account (net of income tax benefit of $218 million)(1) (316)
Balance at December 31, 2009 $ (160)
(1) Amounts transferred to the pension regulatory asset account since the Utility meets the requirement for recovery from customers in future rates.
There was no material difference between PG&E
Corporation’s and the Utility’s accumulated other
comprehensive income (loss) for the periods presented
above.
REVENUE RECOGNITION
The Utility recognizes revenues after persuasive evidence
of an arrangement exists; delivery has occurred or services
have been rendered; the price to the customer is fixed or
determinable; and collectability is reasonably assured.
Revenues meet these criteria as the electricity and natural
gas are delivered, and include amounts for services
rendered but not yet billed at the end of the period.
The Utility recognizes regulatory balancing account
revenues after the CPUC or the FERC has authorized rate
recovery, amounts are objectively determinable and
probable of recovery, and amounts will be collected
within 24 months. (See Note 3 of the Notes to the
Consolidated Financial Statements for further discussion.)
The CPUC authorizes most of the Utility’s revenue
requirements in its general rate case (“GRC”), which
occurs generally every three years. The Utility’s ability to
recover revenue requirements authorized by the CPUC in
the GRC does not depend on the volume of the Utility’s
sales of electricity and natural gas services. Generally, the
balancing account revenue recognition criteria are met
ratably over the year.
The CPUC also has authorized the Utility to collect
additional revenue requirements to recover certain costs
that the Utility has been authorized to pass on to
customers, including costs to purchase electricity and
natural gas; to fund public purpose, demand response,
and customer energy efficiency programs; and to recover
certain capital expenditures. Generally, the balancing
account revenue recognition criteria are met at the time
the costs are incurred.
The Utility’s revenues and earnings also are affected by
incentive ratemaking mechanisms that adjust rates
depending on the extent the Utility meets certain
performance criteria. (See Note 16 of the Notes to the
Consolidated Financial Statements for further discussion.)
The FERC authorizes the Utility’s revenue
requirements in annual transmission owner rate cases.
The Utility’s ability to recover revenue requirements
63