Company: SREA
Filing Date: 2025-02-25
Form Type: 10-K
Source: 0001032208-25-000012
Chunk: 356

Company: SEMPRA
Filing Date: 2025-02-25
Form: 10-K
Item: Item 1
Chunk 356
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CalGas has one operating and reportable segment.BASIS OF PRESENTATIONThis is a combined report of Sempra, SDG&E and SoCalGas. We provide separate information for SDG&E and SoCalGas as required. We have eliminated intercompany accounts and transactions within Sempra’s consolidated financial statements.Use of Estimates in the Preparation of the Financial StatementsWe have prepared our financial statements in conformity with U.S. GAAP. This requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes, including the disclosure of contingent assets and liabilities at the date of the financial statements. Although we believe the estimates and assumptions are reasonable, actual amounts ultimately may differ significantly from those estimates.Subsequent EventsWe evaluated events and transactions that occurred after December 31, 2024 through the date the financial statements were issued, and in the opinion of management, the accompanying financial statements reflect all adjustments and disclosures necessary for a fair presentation.

REGULATED OPERATIONSSDG&E’s and SoCalGas’ accounting policies and financial statements reflect the application of U.S. GAAP provisions governing rate-regulated operations and the policies of the CPUC and the FERC. Under these provisions, a regulated utility records regulatory assets, which are generally costs that would otherwise be charged to expense, if it is probable that, through the ratemaking process, the utility will recover those assets from customers. To the extent that recovery is no longer probable, the related regulatory assets are written off. Regulatory liabilities generally represent amounts collected from customers in advance of the actual expenditure by the utility. If the actual expenditures are less than amounts previously collected from customers, the excess would be refunded to customers, generally by reducing future rates. Regulatory assets and liabilities may also arise from other transactions such as unrealized losses and/or gains on fixed-price contracts and other derivatives or certain deferred income tax benefits that are passed through to customers in future rates. In addition, SDG&E and SoCalGas record regulatory liabilities when the CPUC or, in the case of SDG&E, the FERC, requires a refund to be made to customers or has required that a gain or other transaction of net allowable costs be given to customers over future periods.

2024 Form 10-K  |  F-27

Determining probability of recovery of regulatory assets requires judgment by management and may include, but is not limited to, consideration of:▪the nature of the event giving rise to the assessment▪existing statutes and regulatory code▪legal precedents▪reg