[Code of Federal Regulations]
[Title 7, Volume 11]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1767.17]

[Page 791-792]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER XVII--RURAL UTILITIES SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 1767--ACCOUNTING REQUIREMENTS FOR RUS ELECTRIC BORROWERS--Table of Contents
 
                  Subpart B--Uniform System of Accounts
 
Sec. 1767.17  Operating expense instructions.

    (a) Supervision and engineering. The supervision and engineering 
includible in the operating expense accounts shall consist of the 
salary, employee pensions and benefits, social security and other 
payroll taxes, injuries and damages, and other expenses of 
superintendents, engineers, clerks, other employees, and consultants 
engaged in supervising and directing the operation and maintenance of 
each utility function. Whenever allocations are necessary in order to 
arrive at the amount to be included in any account, the method and basis 
of allocation shall be reflected by underlying records.
    (1) Labor items:
    (i) Special tests to determine efficiency of equipment operation;
    (ii) Preparing or reviewing budgets, estimates, and drawings 
relating to operation or maintenance for departmental approval;
    (iii) Preparing instructions for operations and maintenance 
activities;
    (iv) Reviewing and analyzing operating results;
    (v) Establishing organizational setup of departments and executing 
changes therein;
    (vi) Formulating and reviewing routines of departments and executing 
changes therein;
    (vii) General training and instruction of employees by supervisors 
whose pay is chargeable hereto. Specific instructions and training in a 
particular type of work is chargeable to the appropriate functional 
account (See paragraph (c)(19) of this section); and
    (viii) Secretarial work for supervisory personnel, but not general 
clerical and stenographic work chargeable to other accounts.
    (2) Expense items:
    (i) Employee pensions and benefits;
    (ii) Social security and other payroll taxes;
    (iii) Injuries and damages;
    (iv) Consultants' fees and expenses; and
    (v) Meals, traveling, and incidental expenses.
    (b) Maintenance. (1) The cost of maintenance chargeable to the 
various operating expense and clearing accounts includes labor, employee 
pensions and benefits, social security and other payroll taxes, injuries 
and damages, materials, overheads, and other expenses incurred in 
maintenance work. A list of work operations applicable generally to 
utility plant is included in this paragraph (b). Other work operations 
applicable to specific classes of plant are listed in functional 
maintenance expense accounts.
    (2) Materials recovered in connection with the maintenance of 
property shall be credited to the same account to which the maintenance 
cost was charged.
    (3) If the book cost of any property is carried in Account 102, 
Electric Plant Purchased or Sold, the cost of maintaining such property 
shall be charged to the accounts for maintenance of property of the same 
class and use, the book cost of which is carried in other electric plant 
in service accounts. Maintenance of property leased from others shall be 
treated as provided in paragraph (c) of this section.
    (4) Items:
    (i) Direct field supervision of maintenance;
    (ii) Inspecting, testing, and reporting on condition of plant 
specifically to determine the need for repairs, replacements, 
rearrangements, and changes and inspecting and testing the adequacy of 
repairs which have been made;
    (iii) Work performed specifically for the purpose of preventing 
failure, restoring serviceability or maintaining life of plant;
    (iv) Rearranging and changing the location of plant not retired;
    (v) Repairing for reuse materials recovered from plant;
    (vi) Testing for, locating, and clearing trouble;

[[Page 792]]

    (vii) Net cost of installing, maintaining, and removing temporary 
facilities to prevent interruptions in service; and
    (viii) Replacing or adding minor items of plant which do not 
constitute a retirement unit.
    (c) Rents. (1) The rent expense accounts provided under the several 
functional groups of expense accounts shall include all rents, including 
taxes paid by the lessee on leased property, for property used in 
utility operations, except minor amounts paid for occasional or 
infrequent use of any property or equipment and all amounts paid for use 
of equipment that, if owned, would be includible in plant Accounts 391 
to 398 inclusive, which shall be treated as an expense item and included 
in the appropriate function account and rents which are chargeable to 
clearing accounts, and distributed therefrom to the appropriate account.
    (2) If rents cover property used for more than one function such as 
production and transmission, or by more than one department, the rents 
shall be apportioned to the appropriate rent expense or clearing 
accounts of each department on an actual, or if necessary, an estimated 
basis.
    (3) When a portion of property or equipment rented from others for 
use in connection with utility operations is subleased, the revenue 
derived from such subleasing shall be credited to the rent revenue 
account in operating revenues; provided, however, that in case the rent 
was charged to a clearing account, amounts received from subleasing the 
property shall be credited to such clearing account.
    (4) The cost, when incurred by the lessee, of operating and 
maintaining leased property, shall be charged to the accounts 
appropriate for the expense if the property were owned.
    (5) The cost incurred by the lessee of additions and replacements to 
electric plant leased from others shall be account for as provided in 
Sec. 1767.16 (f).
    (d) Training costs. (1) When it is necessary that employees be 
trained to specifically operate or maintain plant facilities that are 
being constructed, the related costs shall be accounted for as a current 
operating and maintenance expense.
    (2) These expenses shall be charged to the appropriate functional 
accounts currently as they are incurred.
    (3) When the training costs involved relate to facilities which are 
not conventional in nature, or are new to the company's operations, see 
Sec. 1767.16 (c)(19), for the accounting.

[58 FR 59825, Nov. 10, 1993, as amended at 62 FR 42290, Aug. 6, 1997]