ComEd 2006 Annual Report Download - page 189

Exelon Corporation and Subsidiary Companies
Exelon Generation Company, LLC and Subsidiary Companies
Commonwealth Edison Company and Subsidiary Companies
PECO Energy Company and Subsidiary Companies
Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
restricted funds for payment of certain environmental liabilities. As of December 31, 2006 and 2005,
PECO’s restricted cash primarily represented funds from the sales of assets that were subject to
PECO’s Mortgage Indenture. PECO’s restricted cash is not available for general operations until
released from the Mortgage Indenture.
Restricted cash and investments not available for general operations or to satisfy current liabilities
are classified as noncurrent assets. As of December 31, 2006 and 2005, Exelon and Generation had
restricted cash and investments in the nuclear decommissioning trust funds classified as noncurrent
assets.
Allowance for Uncollectible Accounts (Exelon, Generation, ComEd and PECO)
The allowance for uncollectible accounts reflects the Registrants’ best estimates of probable
losses in the accounts receivable balances. The allowance is based on known troubled accounts,
historical experience and other currently available evidence. For ComEd and PECO, customer
accounts are generally considered delinquent if the amount billed is not received by the time the next
bill is issued, which normally occurs on a monthly basis. Customer accounts are written off based upon
approved regulatory requirements.
The following table summarizes the provision for uncollectible accounts for the years ended
December 31, 2006, 2005 and 2004:
For the Year Ended December 31, Exelon Generation ComEd PECO
2006 ................................................... $94 $ 2 $33 $58
2005 ................................................... 77 — 24 45
2004 ................................................... 87 2 37 47
Inventories (Exelon, Generation, ComEd and PECO)
Inventory is recorded at the lower of cost or market, and provisions are made for excess and
obsolete inventory.
Fossil Fuel. Fossil fuel inventory includes the weighted average costs of stored natural gas,
propane, coal and oil. The costs of natural gas, propane, coal and oil are generally included in
inventory when purchased and charged to fuel expense when used. PECO has several long-term
storage contracts for natural gas as well as a liquefied natural gas storage facility.
Materials and Supplies. Materials and supplies inventory generally includes the average costs of
transmission, distribution and generating plant materials. Materials are generally charged to inventory
when purchased and then expensed or capitalized to plant, as appropriate, when installed.
Emission Allowances (Exelon and Generation)
Emission allowances are included in inventory and other deferred debits and are carried at the
lower of weighted average cost or market and charged to fuel expense as they are used in operations.
Exelon’s and Generation’s emission allowance balances as of December 31, 2006 and 2005 were $94
million and $112 million, respectively.
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