# ASC 340-980-50: Other Assets and Deferred Costs — Regulated Operations — 50 Disclosure

Source: FASB Accounting Standards Codification, Basic View

[Read online](https://asc.understandingaccounting.org/asc/340/980/#50-disclosure)

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## ASC 340-980-50: 50 Disclosure

[Read section](https://asc.understandingaccounting.org/asc/340/980/#50-disclosure)

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#### Recovery of Cost Without Return on Investment

##### [340-980-50-1](https://asc.understandingaccounting.org/asc/340/980/#340-980-50-1)

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In some cases, a regulator may permit an entity to include a cost that would be charged to expense by an unregulated entity as an allowable cost over a period of time by amortizing that cost for rate-making purposes, but the regulator does not include the unrecovered amount in the rate base. That procedure does not provide a return on investment during the recovery period. If recovery of such major costs is provided without a return on investment during the recovery period, the entity shall disclose the remaining amounts of such assets and the remaining recovery period applicable to them.

#### Phase-In Plans

##### [340-980-50-2](https://asc.understandingaccounting.org/asc/340/980/#340-980-50-2)

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The terms of any phase-in plans in effect during the year or ordered for future years shall be disclosed. This Subtopic does not permit capitalization for financial reporting of [allowable costs](https://asc.understandingaccounting.org/glossary/a/#allowable-costs "All costs for which revenue is intended to provide recovery. Those costs can be actual or estimated. In that context, allowable costs include interest cost and amounts provided for earnings on shareholders' investments.") deferred for future recovery by the regulator pursuant to a [phase-in plan](https://asc.understandingaccounting.org/glossary/p/#phase-in-plan "Any method of recognition of allowable costs in rates that meets all of the following criteria: The method was adopted by the regulator in connection with a major, newly completed plant of the regulated entity or of one of its suppliers or a major plant scheduled for completion in the near future. The method defers the rates intended to recover allowable costs beyond the period in which those allowable costs would be charged to expense under generally accepted accounting principles (GAAP) applicable to entities in general. The method defers the rates intended to recover allowable costs beyond the period in which those rates would have been ordered under the rate-making methods routinely used prior to 1982 by that regulator for similar allowable costs of that regulated entity.") that does not meet the criteria of paragraph [980-340-25-3](https://asc.understandingaccounting.org/asc/340/980/#340-980-25-3) or a phase-in plan related to a plant on which substantial physical construction was not completed before January 1, 1988. Nevertheless, the financial statements shall include disclosure of the net amount deferred at the balance sheet date for rate-making purposes and the net change in deferrals for rate-making purposes during the year for those plans.

#### Allowance for Earnings on Shareholders' Investment Capitalized for Rate-Making Purposes

##### [340-980-50-3](https://asc.understandingaccounting.org/asc/340/980/#340-980-50-3)

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The nature and amounts of any allowance for earnings on shareholders' investment capitalized for rate-making purposes but not capitalized for financial reporting shall be disclosed.