Methods of Cost Accumulation

The utility must designate on Attachment “B” of the Standard Utility Agreement the procedure by which the adjustment cost will be developed.
  • Actual Cost Method of Accounting
     should be designated on Attachment “B” when:
    • The utility accumulates costs under a work order accounting procedure prescribed by a Federal or State regulatory body; and
    • The utility proposes to request reimbursement for actual direct and related indirect costs.
  • Lump Sum Method of Accounting
     should be designated on Attachment “B” when the utility proposes to request reimbursement based on an agreed lump sum amount supported by a detailed cost analysis.