METROPOLITAN EDISON COMPANY - Pennsylvania Public Utility ...
METROPOLITAN EDISON COMPANY - Pennsylvania Public Utility ...
METROPOLITAN EDISON COMPANY - Pennsylvania Public Utility ...
- No tags were found...
Create successful ePaper yourself
Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.
FIRSTENERGY PENNSYLVANIA COMPANIESMANAGEMENT EFFICIENCY INVESTIGATIONSUMMARY OF JANUARY 2007 MANAGEMENT AUDIT RECOMMENDATIONS ANDSTAFF’S FOLLOW-UP FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS<strong>Public</strong> <strong>Utility</strong> CommissionBureau of Audit’sPrior RecommendationsOriginallyTargetedCompletionDateMEIFindingNumberStaff’s Follow-upFindingsand ConclusionsAs of January 31, 2011Staff’sFollow-upRecommendationIII. AFFILIATE INTERESTS- 6 -Submit affiliate transactioncontracts for Commissionapproval for all FE-PACompanies’ transactions withaffiliates in accordance withSection 2102.September 2007 III-1 The Amended & Restated MutualAssistance Agreement submittedto the Commission in January2009 does not cover all affiliateswith whom Met-Ed, Penelec andPenn Power conduct business.Revise the Amended & RestatedMutual Assistance Agreement toinclude all affiliates with whom theFE-PA Companies transactbusiness and submit it to theCommission for review andapproval.Provide to the Commission Staffa detailed, written justification fordividend payouts above 85percent against other potentialuses for cash within the utilities.None.RecommendationRejected.III-2In certain years, Met-Ed,Penelec, and Penn Power havemade dividend payouts thatexceeded 85% of their netincome, but have never providedthe Commission with a detailed,written justification why suchpayouts were appropriate.Submit a detailed, writtenexplanation for each dividendpayout that has exceeded 85% ofnet income to the Commissionwithin 60 days after public releaseof this audit report, and ensure thatadvance notice and explanationsare submitted to the Commissionwhen such dividend payouts occurin the future.IV. CORPORATE GOVERNANCEHave the Director of Internal Auditreport administratively to a seniorofficer of FirstEnergy other thanthe Chief Financial Officer (CFO).None.RecommendationRejected.IV-1FirstEnergy has not modified thereporting structure for theInternal Audit Department.Modify the Internal AuditDepartment reporting structure sothat it no longer administrativelyreports to the FirstEnergy CFO.Exhibit II-1Page 1 of 12