UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

Before Commissioners: Pat Wood, III, Chairman; 

 Nora Mead Brownell, Joseph T. Kelliher,

 and Suedeen G. Kelly.

Quarterly Financial Reporting and Docket No. RM03-8-002

 Revisions to the Annual Reports

ORDER DELAYING IMPLEMENTATION OF THE CORPORATE OFFICER’S 

CERTIFICATION STATEMENT FOR FERC ANNUAL REPORT FORMS

(Issued March 23, 2005)

1. On March 3, 2005, Edison Electric Institute (EEI) filed a request for an extension 

of time for companies to adopt the revised corporate officer’s certification statement that 

Order No. 646 requires for FERC Form 1, and proposed modifications to the corporate 

officer’s certification for FERC Form 1 to conform with changes to a similar certification 

recently implemented by the Securities and Exchange Commission (SEC). The Interstate 

Natural Gas Association (INGAA) filed a similar request on March 11, 2005 with respect 

to FERC Form 2. For the reasons discussed below, the Commission is granting an 

extension of time, until further notice, for companies to implement the corporate officer’s

certification statement for FERC Annual Report Forms 1, 1-F, 2, 2-A, and 6. In the 

meantime, the Commission will further consider EEI’s and INGAA’s proposed revisions 

to the corporate officer’s certification statement. This order benefits customers by 

providing FERC-jurisdictional entities additional time to put in place the internal controls 

necessary to make the corporate officer’s certification required for the FERC Annual 

Reports.

Background

2. On February 11, 2004, the Commission issued Order No. 646 amending its 

financial reporting regulations.

1

 Among other things, Order No. 646 updated the 

 

1

 Order No. 646, 69 Fed. Reg. 9,030 (Feb. 26, 2004), FERC Stats. & Regs.

¶ 31,158 (2004), order on reh’g, 69 Fed. Reg. 32,440 (June 10, 2004), FERC Stats. & 

Regs. ¶ 31,163 (2004).
Docket No. RM03-8-002 - 2 -

corporate officer’s certification statement for the FERC Annual Reports. The 

Commission directed FERC-jurisdictional entities to file the revised FERC Annual 

Reports, including the new corporate officer’s certification statement, beginning with the 

2004 reporting year. Those FERC Annual Reports will be filed beginning in April 2005. 

EEI’s and INGAA’s Motions

3. In their filings, EEI and INGAA request an extension of time to implement the 

corporate officer’s certification statement for FERC Form 1 and Form 2. EEI and 

INGAA point out that, while the former certification statement focused only on the 

accuracy of the financial information presented in the Annual Reports, the scope of the 

new corporate officer’s certification statement is expanded to include certifications that: 

(1) the company has designed internal accounting controls to ensure that material 

information related to the company is made known to the certifying officer, (2) the

certifying officer has disclosed to the company’s auditors any significant weaknesses in 

the design or operation of the company’s internal accounting controls, and (3) the 

certifying officer has identified any significant changes in the company’s internal 

accounting controls in its FERC Annual Report Form.

4. EEI and INGAA note that the corporate officer certification statement required in 

Order No. 646 is patterned after an early version of the SEC’s Form 10-K certification 

statement. But, according to EEI and INGAA, Order No. 646’s corporate officer’s 

certification statement differs in several ways from the certification ultimately adopted by 

the SEC for Form 10-K. EEI and INGAA, therefore, propose a number of changes to the 

corporate officer’s certification statement for FERC Form 1 and Form 2 that will bring 

the certification statement in line with the new SEC Form 10-K certification.2 In addition 

to these changes, EEI and INGAA also recommend that changes in a reporting 

company’s internal accounting controls that are disclosed in FERC Form 1 and Form 2 be 

submitted as part of the “Important Changes during the Year” section of the form.

5. EEI and INGAA argue that the FERC Form 1 and Form 2 corporate officer 

certification statement requires companies to adopt changes to their accounting and 

auditing systems and to their internal controls two years before those companies are 

required to implement those changes for SEC Form 10-K reporting purposes. According 

to EEI and INGAA, companies filing FERC Form 1 and Form 2 are still in the process of 

adopting the changes needed to make the certification for SEC Form 10-K reporting. EEI 

and INGAA state that the corporate officer certification statement requires companies 

filing FERC Form 1 and Form 2 to make assertions that many can make only after their 

 

2

See EEI’s Motion, Attachment A; see also INGAA’s Motion, Attachment A.
Docket No. RM03-8-002 - 3 -

mechanisms for compliance with the SEC’s reporting requirements are in place, which 

will be at the end of 2006.

6. EEI and INGAA, therefore, request the Commission to (1) delay adoption of the 

corporate officer’s certification statement for the revised FERC Form 1 and Form 2 for 

two years, from April 25, 2005 to April 18, 2007, which would put the certification on 

the same track as the certification requirement for SEC’s Form 10-K, and (2) during the 

two-year delay, to modify the corporate officer’s certification statement for FERC Form 

1 and Form 2 to conform it to the certification statement for SEC Form 10-K. In 

addition, EEI and INGAA request the Commission to reconsider the need for companies 

that do not have registered securities and are not publicly traded to make the corporate 

officer’s certification for FERC Form 1 and Form 2. Instead, EEI and INGAA request 

the Commission to allow such companies to use the former FERC Annual Report Form 

certification, which is still used for the FERC Form 3-Q quarterly financial reports.

Discussion

7. The Commission is granting EEI’s and INGAA’s motion for an extension of time 

until further notice to implement the corporate officer’s certification statement currently 

required for FERC Form 1and Form 2. This extension of time will apply not only to 

FERC Form 1 and Form 2 but also to FERC Forms 1-F, 2-A and 6 since the same 

corporate officer’s certification statement is used for those forms as well. FERCjurisdictional entities filing the FERC Annual Report Forms noted above will use the 

former FERC Annual Report Form certification statement in the interim.

8. In the meantime, the Commission will consider revisions proposed by EEI and 

INGAA to the corporate officer’s certification statement in the FERC Annual Report 

Forms. During this time, the Commission strongly encourages all jurisdictional entities 

to work diligently so they can make the required internal accounting control certifications 

for the Commission’s Annual Report Forms.
Docket No. RM03-8-002 - 4 -

The Commission orders:

EEI’s and INGAA’s motions for an extension of time to implement the corporate 

officer’s certification statement in the FERC Annual Report Forms are granted, as 

discussed in the body of this order.

By the Commission.

( S E A L )

Magalie R. Salas,

Secretary.