Accounting for Infrastructure Regulation An Introduction Martin Rodriguez Pardina Richard Schlirf Rapti Eric Groom Accounting for Infrastructure Regulation Accounting for Infrastructure Regulation An Introduction Martin Rodriguez Pardina Richard Schlirf Rapti Eric Groom THE WORLD BANK Washington, DC © 2008 The International Bank for Reconstruction and Development / The World Bank 1818 H Street, NW Washington, DC 20433 Telephone 202-473-1000 Internet www.worldbank.org E-mail
[email protected] All rights reserved. 1 2 3 4 :: 11 10 09 08 This volume is a product of the staff of the International Bank for Reconstruction and Development / The World Bank. The findings, interpretations, and conclusions expressed in this volume do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Rights and Permissions The material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The International Bank for Reconstruction and Development / The World Bank encourages dissemination of its work and will normally grant permission to reproduce portions of the work promptly. For permission to photocopy or reprint any part of this work, please send a request with complete information to the Copyright Clearance Center Inc., 222 Rosewood Drive, Danvers, MA 01923, USA; telephone: 978-750-8400; fax: 978-750-4470; Internet: www.copyright.com. All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2422; email:
[email protected] ISBN: 978-0-8213-7179-4 eISBN: 978-0-8213-7180-0 DOI: 10.1596/ 978-0-8213-7179-4 Library of Congress Cataloging-in-Publication Data Rodríguez Pardina, Martin, 1961– Accounting for infrastructure regulation : an introduction / Martin Rodríguez Pardina, Richard Schlirf Rapti, Eric Groom. p. cm. Includes bibliographical references and index. ISBN-13: 978-0-8213-7179-4 ISBN-10: 0-8213-7179-7 ISBN-10: 0-8213-7180-0 (electronic) 1. Infrastructure (Economics)—Government policy. 2. Infrastructure (Economics)— Government policy. 3. Public utilities—Accounting—Government policy. 4. Corporations— Accounting—Government policy. 5. Disclosure in accounting—Government policy. I. Rapti, Richard Schlirf, 1960– II. Groom, Eric, 1954– III. Title. HC79.c3r63 2007 657'.838—dc22 2007017934 Contents Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi Abbreviations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xiii 1. Why Accounting Information Matters . . . . . . . . . . . . . . . . . . . . . . . . . 1 1.1. Objectives of public service regulation . . . . . . . . . . . . . . . . . . . . . 3 1.2. External and internal regulatory information . . . . . . . . . . . . . . . . . 5 1.3. Limitations of traditional accounting information for regulatory purposes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 1.4