UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest events reported) September 18, 2002
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September 13, 2002
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PNM RESOURCES, INC.
(Exact name of registrant as specified in its charter)
New Mexico Commission 85-0468296
---------------------------- File Number 333-32170 -----------------------
(State or Other Jurisdiction --------- (I.R.S. Employer
of Incorporation) Identification) Number)
Alvarado Square, Albuquerque, New Mexico 87158
---------------------------------------- -----
(Address of principal executive offices) (Zip Code)
(505) 241-2700
(Registrant's telephone number, including area code)
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(Former name, former address and former fiscal year, if changed since last
report)
Item 5. Other Events
The Company is filing in this Form 8-K its letter dated September 13, 2002 in
response to the Federal Energy Regulatory Commission`s ("FERC") request for
information pertaining to the negative balance in the Company's Account 146,
Accounts Receivable from Associated Companies, for reporting years 2000 and
2001.
September 13, 2002
Mr. John M. Delaware
Deputy Executive Director and
Chief Accountant
Office of the Executive Director
Federal Energy Regulatory Commission
Washington, D. C. 20426
Dear Mr. Delaware:
RE: OED-DRA Docket No. FA02-47-000
In response to your letter dated August 27, 2002 requesting information
pertaining to the Account 146 (Accounts Receivable from Associated Companies)
negative balance in PNM's FERC Form 1 for the years 2000 and 2001, we are
providing the following requested explanation and supporting documentation.
The Company's inter-company accounting procedures do not require that
inter-company transactions be distinguished as an accounts receivable (Account
146) or accounts payable (Account 234), only that inter-company accounts be
used. These balances are eliminated during consolidation.
The FERC consolidation process for purposes of preparing the FERC Form 1
requires a manual financial reporting reclassification in order to net payables
and receivables of associated companies not consolidated for FERC reporting.
This reclassification did not occur in 2000 or 2001. In addition in 2001, an
erroneous elimination was recorded against the inter-company payable account.
This elimination should not have occurred because PNM Resources is not
consolidated for FERC purposes and the actual note payable is in account 233.
Had such reclassifications taken place and the erroneous elimination not
occurred, the open accounts with associated companies would have been as
follows:
Year Ended 2000 Year Ended 2001
As reported receivable - 146 $(1,723,157) $(124,499,443)
As reported payable - 234 5,909,976 133,081,091
------------ --------------
146 balance after reclass $ 4,186,819 $ 8,581,648
------------ --------------
Reclass Note Payable - PNM Resources (8,500,000)
--------------
146 balance after N/P reclass $ 4,186,819 $ 81,648
============ ==============
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The 146 balances after reclassification relate to the following associated
companies:
Business Segment Year Ended 2000 Year Ended 2001
Avistar, Inc. $3,251,333 $(162,114)
Non Operating Subs & Other 935,486 243,762
---------- ---------
Total $4,186,819 $ 81,648
========== ==========
The gross inter-company balances increased significantly in 2001 due to the
creation of the PNM Resources, Inc. holding company and the transfer of common
costs between business segments that occurred at that time.
During 2002, we simplified our inter-company accounting procedures to ensure
proper elimination of inter-company balances for FERC reporting purposes and to
ensure the misclassification between accounts 146 and 234 do not recur. We
believe that the explanation above should eliminate the need for further
documentation, but if that belief is incorrect, please let us know and we will
provide it.
If you have any further questions or concerns, please feel free to contact me at
(505) 241-4691.
Sincerely,
/s/ John R. Loyack
--------------------------------
John R. Loyack
Vice President and
Chief Accounting Officer
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PNM RESOURCES, INC.
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(Registrant)
Date: September 18, 2002 /s/ John R. Loyack
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John R. Loyack
Vice President and Chief Accounting Officer
(Officer duly authorized to sign this report)
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