SEC Comment Letter for NSTAR — Jun 30, 2005
NSTAR/MA (CIK 0001035675)
Date: June 30, 2005 · CIK: 0001035675 · Accession: 0000000000-05-033404
AI Filing Summary & Sentiment
Referenced dates: June 3, 2005, June 16, 2005, June 3, 2005
Letter
By Facsimile and U.S. Mail Thomas May Chairman, President, Chief Executive Officer NSTAR 800 Boylston Street Boston, Massachusetts 02199 Boston Edison Company File No. 1-2301 Form 10-K for the year ended December 31, 2004
Re: NSTAR File No. 1-14768 Form 10-K for the year ended December 31, 2004
Dear Mr. May:
We reviewed your responses to our prior comments on the above referenced filings as set forth in your letter dated June 16, 2005. Our review resulted in the following accounting comment.
Form 10-K for the Year Ended December 31, 2004
1. We note your response to comment one of our letter dated June 3, 2005. Please explain in detail why you have not classified your goodwill as a regulatory asset. In this regard, paragraph 30 of SFAS no. 71 indicates that if the regulator permits all or a portion of goodwill to be amortized over a specific time period as an allowable cost for rate-making purposes, the regulator`s action provides reasonable assurance of the existence of a regulatory asset. We may have further comment.
2. We note your response to comment 3 of our letter dated June 3, 2005. The guidance to the implementation of SFAS no. 87, in particular questions 86 and 87, indicates that each subsidiary should account for its participation in the overall single-employer pension plan as a participation in a multiemployer pension plan. The parent company should, of course, account for the pension plan as a single- employer pension plan in its consolidated financial statements. In this regard, explain to us why the reimbursement from Boston Edison`s affiliates would not net against the prepaid pension asset, instead of creating an inter-company payable. In this regard, we assume you are only reflecting the amount of pension expense related to Boston Edison on its stand alone consolidated income statement. Quantify the amount of the reimbursement that Boston Edison received in from affiliates, and indicate to us the period for which such reimbursement relates. It is unclear to us why Boston Edison is reflecting the entire prepaid pension asset on its consolidated balance sheets.
```````````````````````````````````````````````As appropriate, please respond to this comment within 10 business days or tell us when you will provide us with a response. Please provide us with a response letter that keys your response to our comment and provides any requested supplemental information. Please file your response letter on EDGAR as a correspondence file. ` If you have any questions regarding this comment, please direct them to Robert Babula, Staff Accountant, at (202) 551-3339 or, in his absence, to the undersigned at (202) 551-3841. Any other questions regarding disclosures issues may be directed to H. Christopher Owings, Assistant Director at (202) 551-3725.
Sincerely,
Michael Moran, Esq.
Branch Chief
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<DOCUMENT> <TYPE>LETTER <SEQUENCE>1 <FILENAME>filename1.txt <TEXT> Mail Stop 3561 June 29, 2005 By Facsimile and U.S. Mail Thomas May Chairman, President, Chief Executive Officer NSTAR 800 Boylston Street Boston, Massachusetts 02199 Re: NSTAR File No. 1-14768 Form 10-K for the year ended December 31, 2004 Boston Edison Company File No. 1-2301 Form 10-K for the year ended December 31, 2004 Dear Mr. May: We reviewed your responses to our prior comments on the above referenced filings as set forth in your letter dated June 16, 2005. Our review resulted in the following accounting comment. Form 10-K for the Year Ended December 31, 2004 1. We note your response to comment one of our letter dated June 3, 2005. Please explain in detail why you have not classified your goodwill as a regulatory asset. In this regard, paragraph 30 of SFAS no. 71 indicates that if the regulator permits all or a portion of goodwill to be amortized over a specific time period as an allowable cost for rate-making purposes, the regulator`s action provides reasonable assurance of the existence of a regulatory asset. We may have further comment. 2. We note your response to comment 3 of our letter dated June 3, 2005. The guidance to the implementation of SFAS no. 87, in particular questions 86 and 87, indicates that each subsidiary should account for its participation in the overall single-employer pension plan as a participation in a multiemployer pension plan. The parent company should, of course, account for the pension plan as a single- employer pension plan in its consolidated financial statements. In this regard, explain to us why the reimbursement from Boston Edison`s affiliates would not net against the prepaid pension asset, instead of creating an inter-company payable. In this regard, we assume you are only reflecting the amount of pension expense related to Boston Edison on its stand alone consolidated income statement. Quantify the amount of the reimbursement that Boston Edison received in 2004 from affiliates, and indicate to us the period for which such reimbursement relates. It is unclear to us why Boston Edison is reflecting the entire prepaid pension asset on its consolidated balance sheets. ```````````````````````````````````````````````As appropriate, please respond to this comment within 10 business days or tell us when you will provide us with a response. Please provide us with a response letter that keys your response to our comment and provides any requested supplemental information. Please file your response letter on EDGAR as a correspondence file. ` If you have any questions regarding this comment, please direct them to Robert Babula, Staff Accountant, at (202) 551-3339 or, in his absence, to the undersigned at (202) 551-3841. Any other questions regarding disclosures issues may be directed to H. Christopher Owings, Assistant Director at (202) 551-3725. Sincerely, Michael Moran, Esq. Branch Chief ?? ?? ?? ?? Thomas May NSTAR June 29, 2005 Page 2 </TEXT> </DOCUMENT>