BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION


In the Matter of the Petition  )
of GTE NORTHWEST INCORPORATED  ) DOCKET UT-941064
Relating to the Implementation )
of SFAS 112, Accounting for  ) ORDER GRANTING
       ) PETITION
Postemployment Benefits   )
___________________________________)

 
  On August 11, 1994, GTE Northwest Incorporated (GTE-NW) filed a petition 
pursuant to WAC 480-120-031 and the Commission’s rules, to adopt a change in 
its state accounting standards pertaining to Statement of Financial Accounting 
Standards No. 112 (SFAS 112), “Employers Accounting for Postemployment 
Benefits,” effective 
January 1, 1993.

  The accounting change affects expenses associated with postemployment 
benefits occurring prior to retirement: workers’ compensation, short-term and 
long-term disability plans, and programs associated with voluntary and 
involuntary separation, such as severance benefits, salary continuation, job 
training and counseling.  It requires that these expenses be recorded on an 
accrual basis rather than being expensed as they are paid.  The adoption of 
this accounting treatment requires recognition of the previously-unrecognized 
liability for postemployment benefits in the year of adoption.  The FCC has 
adopted this accounting change effective at the time it is adopted for 
financial accounting purposes, but in any case no later than December 31, 1994. 

  GTE-NW asserts that the amount of this one-time accrual has an intrastate 
revenue impact of $1,024,000 in 1993.  However, GTE-NW is not requesting WUTC 
approval for state ratemaking treatment of this amount in its petition. 

  After review and consideration, the Commission finds that GTE-NW’s accounting 
petition should be approved.  In granting approval of the change in accounting 
procedure requested by GTE, the Commission reserves the right to review and 
determine the ratemaking treatment of GTE-NW’s postemployment benefits in 
future proceedings.   

FINDINGS

  THE COMMISSION FINDS:

  1.  GTE Northwest Incorporated, a Washington corporation, is a public service 
company subject to the 

jurisdiction of this Commission under the provisions of chapter 80.36 RCW.

  2.  As to form, the application filed herein meets the requirements of WAC 
480-120-031.  

  3.  After review and for good cause shown, the petition filed by GTE-NW to 
adopt a change in its state accounting standards to implement SFAS 112 is 
granted.


O R D E R 

  THE COMMISSION ORDERS:

  1.  Subject to the conditions of this order, GTE Northwest Incorporated’s 
petition to adopt a change in its state accounting standards to implement 
Statement of Financial Accounting Standards No. 112, Employers accounting for 
Postemployment Benefits, effective on January 1, 1993, is granted.

  2.  This order shall in no way affect the authority of this Commission over 
rates, service, or accounts, evaluations, estimates, or determination of cost 
or any matters whatsoever that may come before it, nor shall anything herein be 
construed as an acquiescence in any estimate or determination of cost or any 
valuation of property claimed or asserted.

  DATED at Olympia Washington and effective this 27th day of October, 1999.

  WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION



          
                      CAROLE J. WASHBURN
      Secretary