<PAGE>
Form U-13-60
Mutual and Subsidiary Service Companies
Revised February 7, 1980
ANNUAL REPORT
FOR THE PERIOD
Beginning January 1, 1998 and Ending December 31, 1998
TO THE
U. S. SECURITIES AND EXCHANGE COMMISSION
OF
American Electric Power Service Corporation
(Exact Name of Reporting Company)
A Subsidiary Service Company
Date of Incorporation December 17, 1937. If not Incorporated,
Date of Organization
State or Sovereign Power under which Incorporated or Organized
New York
Location of Principal Executive Offices of Reporting Company
1 Riverside Plaza, Columbus, Ohio 43215
Name, title, and address of officer to whom correspondence
concerning this report should be addressed:
1 Riverside Plaza
Gerald R. Knorr Assistant Controller Columbus, Ohio 43215
(Name) (Title) (Address)
Name of Principal Holding Company under which Reporting Company is
organized:
AMERICAN ELECTRIC POWER COMPANY, INC. <PAGE>
<PAGE>
1
INSTRUCTIONS FOR USE OF FORM U-13-60
1. Time of Filing.--Rule 94 provides that on or before the first
day of May in each calendar year, each mutual service company and
each subsidiary service company as to which the Commission shall
have made a favorable finding pursuant to Rule 88, and every
service company whose application for approval or declaration
pursuant to Rule 88 is pending shall file with the Commission an
annual report on Form U-13-60 and in accordance with the Instruc-
tions for that form.
2. Number of Copies.--Each annual report shall be filed in dupli-
cate. The company should prepare and retain at least one extra
copy for itself in case correspondence with reference to the
report becomes necessary.
3. Period Covered by Report.--The first report filed by any
company shall cover the period from the date the Uniform System of
Accounts was required to be made effective as to that company
under Rules 82 and 93 to the end of that calendar year. Sub-
sequent reports should cover a calendar year.
4. Report Format.--Reports shall be submitted on the forms pre-
pared by the Commission. If the space provided on any sheet of
such form is inadequate, additional sheets may be inserted of the
same size as a sheet of the form or folded to such size.
5. Money Amounts Displayed.--All money amounts required to be
shown in financial statements may be expressed in whole dollars,
in thousands of dollars or in hundred thousands of dollars, as
appropriate and subject to provisions of Regulation S-X
(S210.3-01(b)).
6. Deficits Displayed.--Deficits and other like entries shall be
indicated by the use of either brackets or a parenthesis with
corresponding reference in footnotes. (Regulation S-X,
S210.3-01(c)).
7. Major Amendments or Corrections.--Any company desiring to
amend or correct a major omission or error in a report after it
has been filed with the Commission shall submit an amended report
including only those pages, schedules, and entries that are to be
amended or corrected. A cover letter shall be submitted request-
ing the Commission to incorporate the amended report changes and
shall be signed by a duly authorized officer of the company.
8. Definitions.--Definitions contained in Instruction 01-8 to the
Uniform System of Accounts for Mutual Service Companies and Sub-
sidiary Service Companies, Public Utility Holding Company Act of
1935, as amended February 2, 1979 shall be applicable to words or
terms used specifically within this Form U-13-60.
9. Organization Chart.--The service company shall submit with
each annual report a copy of its current organization chart.
<PAGE>
<PAGE>
(Cont'd)
1A
INSTRUCTIONS FOR USE OF FORM U-13-60
10. Methods of Allocation.--The service company shall submit with
each annual report a listing of the currently effective methods of
allocation being used by the service company and on file with the
Securities and Exchange Commission pursuant to the Public Utility
Holding Company Act of 1935.
11. Annual Statement of Compensation for Use of Capital Billed.--
The service company shall submit with each annual report a copy of
the annual statement supplied to each associate company in support
of the amount of compensation for use of capital billed during the
calendar year.<PAGE>
<PAGE>
2
LISTING OF SCHEDULES AND ANALYSIS OF ACCOUNTS
Page
Number
Schedule
Description of Schedules and Accounts or Account
Number
COMPARATIVE BALANCE SHEET Schedule I 4-5
SERVICE COMPANY PROPERTY Schedule II 6-7
ACCUMULATED PROVISION FOR
DEPRECIATION AND AMORTIZATION
OF SERVICE COMPANY PROPERTY Schedule III 8
INVESTMENTS Schedule IV 9
ACCOUNTS RECEIVABLE FROM ASSOCIATE
COMPANIES Schedule V 10
FUEL STOCK EXPENSES UNDISTRIBUTED Schedule VI 11
STORES EXPENSE UNDISTRIBUTED Schedule VII 12
MISCELLANEOUS CURRENT AND ACCRUED
ASSETS Schedule VIII 13
MISCELLANEOUS DEFERRED DEBITS Schedule IX 14
RESEARCH, DEVELOPMENT, OR DEMONSTRATION
EXPENDITURES Schedule X 15
PROPRIETARY CAPITAL Schedule XI 16
LONG-TERM DEBT Schedule XII 17
CURRENT AND ACCRUED LIABILITIES Schedule XIII 18
NOTES TO FINANCIAL STATEMENTS Schedule XIV 19
COMPARATIVE INCOME STATEMENT Schedule XV 20
ANALYSIS OF BILLING - ASSOCIATE
COMPANIES Account 457 21
ANALYSIS OF BILLING - NONASSOCIATE
COMPANIES Account 458 22
ANALYSIS OF CHARGES FOR SERVICE -
ASSOCIATE AND NONASSOCIATE
COMPANIES Schedule XVI 23
SCHEDULE OF EXPENSE BY DEPARTMENT OR
SERVICE FUNCTION Schedule XVII 24-25
DEPARTMENTAL ANALYSIS OF SALARIES Account 920 26
OUTSIDE SERVICES EMPLOYED Account 923 27
EMPLOYEE PENSIONS AND BENEFITS Account 926 28
GENERAL ADVERTISING EXPENSES Account 930.1 29
MISCELLANEOUS GENERAL EXPENSES Account 930.2 30
RENTS Account 931 31
TAXES OTHER THAN INCOME TAXES Account 408 32
DONATIONS Account 426.1 33
OTHER DEDUCTIONS Account 426.5 34
NOTES TO STATEMENT OF INCOME Schedule XVIII 35
<PAGE>
<PAGE>
3
LISTING OF INSTRUCTIONAL FILING REQUIREMENTS
Page
Number
Description of Reports or Statements
ORGANIZATION CHART 36
METHODS OF ALLOCATION 37
ANNUAL STATEMENT OF COMPENSATION FOR USE OF
CAPITAL BILLED 38
SIGNATURE CLAUSE 39
<PAGE>
<PAGE>
4
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE I - COMPARATIVE BALANCE SHEET
Give balance sheet of the company as of December 31 of the current and
prior year.
ACCOUNT ASSETS AND OTHER DEBITS
AS OF DECEMBER 31
CURRENT PRIOR
(In Thousands)
SERVICE COMPANY PROPERTY
101 Service company property (Schedule II) $248,898 $229,154
107 Construction work in progress (Schedule II) -- --
Total Property 248,898 229,154
108 Less accumulated provision for depreciation and
amortization of service company property
(Schedule III) 92,199 77,370
Net Service Company Property 156,699 151,784
INVESTMENTS
123 Investments in associate companies (Schedule IV) -- --
124 Other investments (Schedule IV) 87,669 40,741
Total Investments 87,669 40,741
CURRENT AND ACCRUED ASSETS
131 Cash -- 9
134 Special deposits 99 100
135 Working funds 340 415
136 Temporary cash investments (Schedule IV) -- 200
141 Notes receivable 111 116
143 Accounts receivable 7,772 3,355
144 Accumulated provision for uncollectible
accounts -- --
146 Accounts receivable from associate
companies (Schedule V) 109,144 85,841
152 Fuel stock expenses undistributed (Schedule VI) -- --
154 Materials and supplies -- --
163 Stores expense undistributed (Schedule VII) -- --
165 Prepayments 1,030 508
174 Miscellaneous current and accrued
assets (Schedule VIII) -- 7
Total Current and Accrued Assets 118,496 90,551
DEFERRED DEBITS
181 Unamortized debt expense 4,499 5,168
184 Clearing accounts -- --
186 Miscellaneous deferred debits (Schedule IX) 5,405 6,341
188 Research, development, or demonstration
expenditures (Schedule X) -- --
190 Accumulated deferred income taxes 59,009 41,537
Total Deferred Debits 68,913 53,046
TOTAL ASSETS AND OTHER DEBITS $431,777 $336,122
Note: Unamortized Debt Expense includes unamortized loss
on reacquired debt of $4,444,619 at December 31, 1998 and
$5,105,171 at December 31, 1997.
<PAGE>
<PAGE>
5
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE I - COMPARATIVE BALANCE SHEET
ACCOUNT LIABILITIES AND PROPRIETARY CAPITAL AS OF DECEMBER 31
CURRENT PRIOR
(In Thousands)
PROPRIETARY CAPITAL
201 Common stock issued (Schedule XI) $ 1,350 $ 1,350
211 Miscellaneous paid-in-capital (Schedule XI) -- --
215 Appropriated retained earnings (Schedule XI) -- --
216 Unappropriated retained earnings (Schedule XI) -- --
Total Proprietary Capital 1,350 1,350
LONG-TERM DEBT
223 Advances from associate companies (Schedule XII) 1,100 1,100
224 Other long-term debt (Schedule XII) 65,000 70,000
225 Unamortized premium on long-term debt -- --
226 Unamortized discount on long-term debt-debit -- --
Total Long-term Debt 66,100 71,100
OTHER NONCURRENT LIABILITIES
227 Obligations under capital leases - Noncurrent 50,947 46,363
224.6 Other 81,125 67,692
Total Other Noncurrent Liabilities 132,072 114,055
CURRENT AND ACCRUED LIABILITIES
231 Notes payable 40,111 11,529
232 Accounts payable 8,268 13,030
233 Notes payable to associate companies
(Schedule XIII) -- --
234 Accounts payable to associate companies
(Schedule XIII) 37,841 28,316
236 Taxes accrued 5,347 1,801
237 Interest accrued 399 370
238 Dividends declared -- --
241 Tax collections payable 2,745 3,927
242 Miscellaneous current and accrued liabilities
(Schedule XIII) 74,492 35,943
243 Obligations under capital leases - Current 18,597 14,111
Total Current and Accrued Liabilities 187,800 109,027
DEFERRED CREDITS
253 Other deferred credits 12,196 11,024
255 Accumulated deferred investment tax credits 1,003 1,054
Total Deferred Credits 13,199 12,078
282 ACCUMULATED DEFERRED INCOME TAXES 31,256 28,512
TOTAL LIABILITIES AND PROPRIETARY CAPITAL $431,777 $336,122
Note: Long-term debt includes $5,000,000 due within one year at
December 31, 1998 and $15,000,000 at December 31, 1997 (See note 6,
Schedule XIV). Other Other noncurrent liabilities includes amounts due
within one year of $825,635 at December 31, 1998 and $759,577 at
December 31, 1997.
<PAGE>
<PAGE>
<TABLE>
6
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE II - SERVICE COMPANY PROPERTY
BALANCE AT RETIREMENTS OTHER BALANCE AT
BEGINNING ADDITIONS OR CHANGES 1/ CLOSE OF
DESCRIPTION OF YEAR SALES YEAR
(In Thousands)
SERVICE COMPANY PROPERTY
Account
<S> <C> <C> <C> <C> <C>
301 ORGANIZATION $ -- $ -- $ -- $ -- $ --
303 MISCELLANEOUS
INTANGIBLE PLANT -- -- -- -- --
304 LAND AND LAND RIGHTS 5,108 -- -- -- 5,108
305 STRUCTURES AND
IMPROVEMENTS 140,719 -- -- -- 140,719
306 LEASEHOLD IMPROVEMENTS 580 -- 580
307 EQUIPMENT 2/ -- -- -- -- --
308 OFFICE FURNITURE AND
EQUIPMENT 1,019 -- -- -- 1,019
309 AUTOMOBILES, OTHER
VEHICLES AND RELATED
GARAGE EQUIPMENT -- -- -- -- --
310 AIRCRAFT AND AIRPORT
EQUIPMENT -- -- -- -- --
311 OTHER SERVICE COMPANY
PROPERTY 3/ 81,728 27,608 (7,863) -- 101,472
SUB-TOTAL 229,154 27,608 (7,863) -- 248,898
107 CONSTRUCTION WORK IN
PROGRESS 4/ -- -- -- -- --
TOTAL $229,154 $27,608 $ (7,863) $ -0- $248,898
1/ PROVIDE AN EXPLANATION OF THOSE CHANGES CONSIDERED MATERIAL:
</TABLE>
<PAGE>
7
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE II - CONTINUED
2/ SUBACCOUNTS ARE REQUIRED FOR EACH CLASS OF EQUIPMENT OWNED. THE SERVICE
COMPANY SHALL PROVIDE A LISTING BY SUBACCOUNT OF EQUIPMENT ADDITIONS DURING
THE YEAR AND THE BALANCE AT THE CLOSE OF THE YEAR:
BALANCE AT
SUBACCOUNT DESCRIPTION ADDITIONS CLOSE OF YEAR
None
TOTAL $ -0- $ -0-
3/ DESCRIBE OTHER SERVICE COMPANY PROPERTY:
Includes leased assets at December 31, 1998 ($101,449,000) which have been
capitalized in accordance with FASB Statement Nos. 13 and 71 and other owned
assets at December 31, 1998 ($23,000).
4/ DESCRIBE CONSTRUCTION WORK IN PROGRESS:
<PAGE>
<PAGE>
<TABLE>
8
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE III
ACCUMULATED PROVISION FOR DEPRECIATION
AND AMORTIZATION OF SERVICE COMPANY PROPERTY
BALANCE AT ADDITIONS OTHER CHANGES BALANCE AT
DESCRIPTION BEGINNING CHARGED RETIREMENTS ADD (DEDUCT) CLOSE OF
OF YEAR TO 1/ YEAR
ACCOUNT 403
Account (In Thousands)
<S> <C> <C> <C> <C> <C>
301 ORGANIZATION $ -- $ -- $ -- $ -- $ --
303 MISCELLANEOUS
INTANGIBLE
PLANT -- -- -- -- --
304 LAND AND LAND
RIGHTS -- -- -- -- --
305 STRUCTURES AND
IMPROVEMENTS 55,698 3,959 -- -- 59,656
306 LEASEHOLD
IMPROVEMENTS 167 155 -- -- 322
307 EQUIPMENT -- -- -- -- --
308 OFFICE
FURNITURE AND
FIXTURES 268 41 -- -- 309
309 AUTOMOBILES,
OTHER VEHICLES
AND RELATED
GARAGE EQUIPMENT -- -- -- -- --
310 AIRCRAFT AND
AIRPORT EQUIPMENT -- -- -- -- --
311 OTHER SERVICE
COMPANY PROPERTY 21,237 18,223 (7,549) -- 31,912
TOTAL $77,370 $22,378 $(7,549) $ -0- $92,199
1/ PROVIDE AN EXPLANATION OF THOSE CHANGES CONSIDERED MATERIAL:
</TABLE>
<PAGE>
<PAGE>
9
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE IV - INVESTMENTS
INSTRUCTIONS: Complete the following schedule concerning investments.
Under Account 124, "Other Investments", state each investment
separately, with description, including, the name of issuing
company, number of shares or principal amount, etc.
Under Account 136, "Temporary Cash Investments", list each
investment separately.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
(In Thousands)
ACCOUNT 123 - INVESTMENT IN ASSOCIATE COMPANIES
None
ACCOUNT 124 - OTHER INVESTMENTS
Cash Surrender Value of Life
Insurance Policies (net of policy
loans and accrued interest) $ 8,893 $11,058
Umbrella Trust 31,718 40,858
Notes Receivable Constructive
Marketing Program 130 168
Other Investments 1991-1996 COLI Tax -- 26,613
Other Investments 1991-1996 COLI Interest -- 8,972
Sub-Total Other Investments 40,741 87,669
ACCOUNT 136 - TEMPORARY CASH INVESTMENTS
Ford Motor Credit 200 --
TOTAL $40,941 $87,669
<PAGE>
<PAGE>
<TABLE>
10
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE V - ACCOUNTS RECEIVABLE FROM ASSOCIATE COMPANIES
INSTRUCTIONS: Complete the following schedule listing accounts receivable from
each associate company. Where the service company has provided
accommodation or convenience payments for associate companies, a
separate listing of total payments for each associate company by
subaccount should be provided.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
ACCOUNT 146 - ACCOUNTS RECEIVABLE FROM (In Thousands)
ASSOCIATE COMPANIES
<S> <C> <C>
Associate Companies
AEP Communications, Inc. $ 137 $ 53
AEP Communications, LLC 188 725
AEP Energy Services, Inc. 241 939
AEP Generating Company 643 353
AEP Global Investments B.V. 1 1
AEP Investments, Inc. 2 7
AEP Pushan Power, LDC 25 25
AEP Resources, Inc. 906 1,006
AEP Resources Delaware, Inc. 1 1
AEP Resources Gas Holding Company -- 41
AEP Resources International, Limited 26 4
AEP Resources Limited -- 69
AEP Resources Project Management Company, Ltd. 1 1
AEP Resources Service Company 182 227
AEP Resources Ventures, Inc. -- 1
American Electric Power Company, Inc. 572 1,577
Appalachian Power Company 22,796 21,707
Appalachian/Ohio Power Joint Account (Amos) 726 7,482
Appalachian/Ohio Power Joint Account (Sporn) 1,025 3,418
Blackhawk Coal Company/Price River Coal Company, Inc. 70 134
Cardinal Operating Company 564 318
Cedar Coal Co. 6 --
Central Appalachian Coal Company 1 3
Central Coal Company 2 3
Central Ohio Coal Company 194 261
Central Operating Company 33 14
Columbus Southern Power Company 18,231 24,650
Conesville Coal Preparation Company 50 175
Indiana Michigan Power Company 19,851 24,072
Indiana Michigan Power/AEP Generating Joint
Account (Rockport) 637 930
Indiana Michigan Power Company-Water Transportation 142 1,378
Kentucky Power Company 4,204 3,901
Kingsport Power Company 391 755
LIG Liquids Company, L.L.C. -- 7
Louisiana Interstate Gas Company, L.L.C. -- 10
SUB-TOTAL 71,848 94,248
</TABLE>
<PAGE>
<PAGE>
<TABLE>
(Cont'd)
10A
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE V - ACCOUNTS RECEIVABLE FROM ASSOCIATE COMPANIES
INSTRUCTIONS: Complete the following schedule listing accounts receivable from
each associate company. Where the service company has provided
accommodation or convenience payments for associate companies, a
separate listing of total payments for each associate company by
subaccount should be provided.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
ACCOUNT 146 - ACCOUNTS RECEIVABLE FROM (In Thousands)
ASSOCIATE COMPANIES
<S> <C> <C>
Sub-Total Brought Forward 71,848 94,248
Ohio Power Company 11,864 12,023
Ohio Power Company-Cook Coal Terminal 57 516
Ohio Power Company (Gavin) 88 131
Simco Inc. 1 1
Southern Appalachian Coal Company 2 5
Southern Ohio Coal Company - Meigs 786 1,419
West Virginia Power Company -- 1
Wheeling Power Company 471 75
Windsor Coal Company 228 388
Statutory Subsidiaries
Indiana-Kentucky Electric Corporation 261 145
Ohio Valley Electric Corporation 235 192
TOTAL $85,841 $109,144
ANALYSIS OF CONVENIENCE OR ACCOMMODATION PAYMENTS: TOTAL
PAYMENTS
BY COMPANY: (In Thousands)
Associate Companies
AEP Acquisition, L.L.C. $ (1)
AEP Communications, Inc. 14
AEP Energy Services, Inc. 81
AEP Generating Company 56
AEP Pushan Power, LDC (5)
AEP Resources, Inc. 11
AEP Resources Project Management Company, Ltd. 1
AEP Resources Service Company 212
American Electric Power Company, Inc. 6
Appalachian Power Company 111,697
Appalachian/Ohio Power Joint Account (Amos) 1,163
Appalachian/Ohio Power Joint Account (Sporn) 610
Blackhawk Coal Company/Price River Coal Company, Inc. 112
Cardinal Operating Company 1,069
Cedar Coal Co. 7
Central Appalachian Coal Company 2
Central Coal Company 2
Central Ohio Coal Company 2,245
Central Operating Company 24
SUB-TOTAL PAYMENTS 117,306
</TABLE>
<PAGE>
<PAGE>
<TABLE>
(Cont'd) 10B
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE V - ACCOUNTS RECEIVABLE FROM ASSOCIATE COMPANIES
INSTRUCTIONS: Complete the following schedule listing accounts receivable from
each associate company. Where the service company has provided
accommodation or convenience payments for associate companies, a
separate listing of total payments for each associate company by
subaccount should be provided.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
ANALYSIS OF CONVENIENCE OR ACCOMMODATION PAYMENTS: TOTAL
PAYMENTS
(In Thousands)
<S> <C>
Sub-Total Brought Forward 117,306
Colomet, Inc. 401
Columbus Southern Power Company 127,883
Conesville Coal Preparation Company 319
Franklin Real Estate Company 1
Indiana Franklin Realty, Inc. 1
Indiana Michigan Power Company 366,422
Indiana Michigan Power/AEP Generating Joint Account (Rockport) 318
Indiana Michigan Power Company-Water Transportation 2,310
Kentucky Power Company 4,249
Kingsport Power Company 933
LIG Liquids Company, L.L.C. 7
Louisiana Interstate Gas Company, L.L.C. 9
Ohio Power Company 51,385
Ohio Power Company-Cook Coal Terminal 102
Simco Inc. 1
Southern Appalachian Coal Company 2
Southern Ohio Coal Company-Martinka 1,526
Southern Ohio Coal Company-Meigs 5,048
Wheeling Power Company 493
Windsor Coal Company 635
Statutory Subsidiaries
Indiana-Kentucky Electric Corporation 1
Ohio Valley Electric Corporation 8
TOTAL PAYMENTS $679,360
FOR:
Interchange Power Pool and Transmission Agreements $550,366
Insurances 56,386
Employee Benefit Plans 68,219
State Taxes 60
Membership Dues 128
Short Term Investment 401
Trustee Fees 1,245
Educational Programs 974
ECAR Assessment 756
External Audits 68
Telephone Services 102
Miscellaneous 655
TOTAL PAYMENTS $679,360
</TABLE>
<PAGE>
<PAGE>
11
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE VI - FUEL STOCK EXPENSES UNDISTRIBUTED
INSTRUCTIONS:
Report the amount of labor and expenses incurred with respect to
fuel stock expenses during the year and indicate amount attributable
to each associate company. Under the section headed "Summary" listed
below give an overall report of the fuel functions performed by the
service company.
<TABLE>
_______________________________________________________________________________
D E S C R I P T I O N LABOR EXPENSES TOTAL
(In Thousands)
<CAPTION>
ACCOUNT 152 - FUEL STOCK EXPENSES UNDISTRIBUTED
<S> <C> <C> <C>
Associate Companies
AEP Energy Services, Inc. $ 32 $ 15 $ 47
AEP Generating Company 7 4 11
AEP Resources, Inc. 4 2 6
AEP Resources Service Company 12 7 19
American Electric Power Company, Inc. 101 63 164
Appalachian Power Company 983 563 1,546
Appalachian/Ohio Power Joint Account (Amos) 105 60 165
Appalachian/Ohio Power Joint Account (Sporn) 58 33 91
Blackhawk Coal Company 9 4 13
Cardinal Operating Company 220 131 351
Cedar Coal Co. 7 3 10
Central Appalachian Coal Company 1 1 2
Central Coal Company 4 2 6
Central Ohio Coal Company 807 492 1,299
Columbus Southern Power Company 562 323 885
Conesville Coal Preparation Company 334 196 530
Indiana Michigan Power Company 279 156 435
Indiana Michigan Power/AEP Generating Joint
Account (Rockport) 490 313 803
Indiana Michigan Power Company-Water Transportation 176 198 374
Kentucky Power Company 289 158 447
Kingsport Power Company 2 1 3
Ohio Power Company 1,234 757 1,991
Ohio Power Company-Cook Coal Terminal 295 139 434
Simco Inc. 1 1 2
Southern Appalachian Coal Company 5 2 7
Southern Ohio Coal Company 3,058 1,854 4,912
Wheeling Power Company 2 1 3
Windsor Coal Company 1,165 664 1,829
Statutory Subsidiaries
Indiana-Kentucky Electric Corporation 144 65 209
Ohio Valley Electric Corporation 121 54 175
TOTAL $10,507 $6,262 $16,769
SUMMARY: Managerial, engineering, technical and administrative services rendered to
AEP System coal mining companies, and coal procurement services rendered to
AEP System generating companies and other similar services.
</TABLE>
<PAGE>
<TABLE>
12
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE VII - STORES EXPENSE UNDISTRIBUTED
<CAPTION>
INSTRUCTIONS:
Report the amount of labor and expenses incurred with respect to
stores expense during the year and indicate amount attributable to
each associate company.
D E S C R I P T I O N LABOR EXPENSES TOTAL
(In Thousands)
ACCOUNT 163 - STORES EXPENSE UNDISTRIBUTED
<S> <C> <C> <C>
Associate Companies
AEP Communications, Inc. $ 10 $ 6 $ 16
AEP Communications, LLC 1 -- 1
AEP Energy Services, Inc. 31 19 50
AEP Generating Company 286 173 459
AEP Resources, Inc. 45 27 72
AEP Resources Service Company 18 10 28
American Electric Power Company, Inc. 12 8 20
Appalachian Power Company 2,526 1,820 4,346
Appalachian/Ohio Power Joint Account (Amos) 3 54 57
Appalachian/Ohio Power Joint Account (Sporn) 3 52 55
Cardinal Operating Company 2 44 46
Cedar Coal Co. -- -- --
Central Ohio Coal Company 3 58 61
Columbus Southern Power Company 1,369 915 2,284
Conesville Coal Preparation Company 1 13 14
Indiana Michigan Power Company 1,766 1,254 3,020
Indiana Michigan Power/AEP Generating
Joint Account (Rockport) 3 51 54
Indiana Michigan Power Company-Water Transportation 2 30 32
Kentucky Power Company 501 362 863
Kingsport Power Company 108 72 180
Ohio Power Company 2,367 1,774 4,141
Ohio Power Company-Cook Coal Terminal 1 15 16
Ohio Power Company (Gavin) -- -- --
Southern Ohio Coal Company 10 187 197
Wheeling Power Company 69 44 113
Windsor Coal Company 4 77 81
Statutory Subsidiaries
Indiana-Kentucky Electric Corporation 1 0 1
TOTAL $9,142 $7,065 $16,207
</TABLE>
<PAGE>
<PAGE>
<TABLE> 13
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE VIII
MISCELLANEOUS CURRENT AND ACCRUED ASSETS
<CAPTION>
INSTRUCTIONS: Provide detail of items in this account. Items less than $10,000
may be grouped, showing the number of items in each group.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
(In Thousands)
<S> <C> <C>
ACCOUNT 174 - MISCELLANEOUS CURRENT AND
ACCRUED ASSETS
Payroll Adjustments $7 $ --
TOTAL $7 $-0-
</TABLE>
<PAGE>
<TABLE> 14
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE IX - MISCELLANEOUS DEFERRED DEBITS
INSTRUCTIONS: Provide detail of items in this account. Items less than $10,000
may be grouped by class showing the number of items in each class.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
(In Thousands)
ACCOUNT 186 - MISCELLANEOUS DEFERRED DEBITS
<S> <C> <C>
Regulatory Asset-Postretirement Benefits $1,621 $1,297
Regulatory Asset-Postemployment Benefits 1,881 2,572
Regulatory Asset-Taxes 211 (4)
Unbilled Charges 2,628 1,540
TOTAL $6,341 $5,405
</TABLE>
<PAGE>
15
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE X
RESEARCH, DEVELOPMENT OR DEMONSTRATION EXPENDITURES
INSTRUCTIONS: Provide a description of each material research, development, or
demonstration project which incurred costs by the
service corporation during the year.
D E S C R I P T I O N AMOUNT
(In Thousands)
ACCOUNT 188 - RESEARCH, DEVELOPMENT, OR DEMONSTRATION
EXPENDITURES
Transmission, Distribution & UHV Systems $2,038
Advanced Pressurized Water Reactor Design 58
Ash Marketing 138
Coal-Fired Generation 202
General Activities 270
Hydro Generation 6
TOTAL $2,712
<PAGE>
<TABLE>
16
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE XI - PROPRIETARY CAPITAL
NUMBER OF PAR OR STATED OUTSTANDING CLOSE OF PERIOD
ACCOUNT NUMBER CLASS OF STOCK SHARES VALUE
AUTHORIZED PER SHARE NO. OF SHARES TOTAL AMOUNT
<S> <C> <C> <C> <C>
201 COMMON STOCK ISSUED 20,000 $100 13,500 $1,350,000
INSTRUCTIONS: Classify amounts in each account with brief explanation, disclosing the
general nature of transactions which gave rise to the reported amounts.
D E S C R I P T I O N AMOUNT
ACCOUNT 211 - MISCELLANEOUS PAID-IN CAPITAL
None
ACCOUNT 215 - APPROPRIATED RETAINED EARNINGS
None
TOTAL $ -0-
INSTRUCTIONS: Give particulars concerning net income or (loss) during the year,
distinguishing between compensation for the use of capital owed or net
loss remaining from servicing nonassociates per the General Instructions
of the Uniform System of Accounts. For dividends paid during the year
in cash or otherwise, provide rate percentage, amount of dividend, date
declared and date paid.
BALANCE AT NET INCOME BALANCE AT
D E S C R I P T I O N BEGINNING OR DIVIDENDS CLOSE
OF YEAR (LOSS) PAID OF YEAR
ACCOUNT 216 - UNAPPROPRIATED RETAINED EARNINGS
None
TOTAL $ -0- $ -0- $ -0- $ -0-
</TABLE>
<PAGE>
<PAGE>
<TABLE>
17
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE XII - LONG-TERM DEBT
INSTRUCTIONS: Advances from associate companies should be reported separately for
advances on notes, and advances on open account. Names of associate
companies from which advances were received shall be shown under the
class and series of obligation column. For Account 224 - Other
long-term debt provide the name of creditor company or organization,
terms of the obligation, date of maturity, interest rate, and the amount
authorized and outstanding.
TERMS OF OBLIG DATE BALANCE AT ADDITIONS DEDUCTIONS BALANCE AT
NAME OF CLASS & SERIES OF INTEREST AMOUNT BEGINNING 1/ CLOSE
CREDITOR OF OBLIGATION MATURITY RATE AUTHORIZED OF YEAR OF YEAR
<S> <C> <C> <C> <C> <C> <C> <C>
(In Thousands)
ACCOUNT 223 -
ADVANCES FROM
ASSOCIATE COMPANIES:
Advance on Open Account
American Electric Power
Company, Inc. NONE $ 1,100 $ 1,100 $ -- $ -- $ 1,100
ACCOUNT 224 - OTHER LONG-
TERM DEBT:
PNC National Association,
Pittsburgh 10/14/98 5.293 10,000 10,000 -- 10,000 -0-
Connecticut Bank & Trust Company
(as Trustee),
--Series D Mortgage Notes 12/15/99 9.000 20,000 5,000 -- 2,500 2,500
--Series E Mortgage Notes 12/15/08 9.600 70,000 55,000 -- 2,500 52,500
Suntrust Bank 10/14/03 6.355 10,000 -- 10,000 -- 10,000
Sub-Total 110,000 70,000 10,000 15,000 65,000
TOTAL $111,100 $71,100 $10,000 $15,000 $66,100
1/ GIVE AN EXPLANATION OF DEDUCTIONS: Loan payments. See Note 6, Schedule XIV, for
further explanation of dates of maturity.
</TABLE>
<PAGE> 18
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE XIII - CURRENT AND ACCRUED LIABILITIES
INSTRUCTIONS: Provide balance of notes and accounts payable to each associate
company. Give description and amount of miscellaneous current
and accrued liabilities. Items less than $10,000 may be grouped,
showing the number of items in each group.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
(In Thousands)
<S> <C> <C>
ACCOUNT 233 - NOTES PAYABLE TO ASSOCIATE COMPANIES
None
TOTAL $ -0- $ -0-
(In Thousands)
ACCOUNT 234 - ACCOUNTS PAYABLE TO ASSOCIATE
COMPANIES
Appalachian Power Company $ -- $ 418
Cedar Coal Co. 11 --
Colomet, Inc. 200 --
Columbus Southern Power Company 44 15
Indiana Michigan Power Company 5 --
Kentucky Power Company -- 4,030
Ohio Power Company 28,012 33,363
Southern Ohio Coal Company 30 7
Miscellaneous - 7 items in 1997; 7 items in 1998 14 8
TOTAL $28,316 $37,841
(In Thousands)
ACCOUNT 242 - MISCELLANEOUS CURRENT AND
ACCRUED LIABILITIES
Accrued Vacation Pay $16,870 $19,805
Accrued Incentive Pay 14,963 51,056
Accrued Workers' Compensation 533 69
AEP System Stock Purchase Plan 1 --
Payroll Withholdings 345 273
Accrued Rent on John E. Dolan Engineering Laboratory 1,143 1,099
Accrued Rent on Personal Property -- 812
Accrued Rent for Office Space at Market Square,
Washington, D.C. 73 60
Group Medical Plan 79 270
Personal Property Taxes 105 846
Real Estate Taxes 1,831 202
TOTAL $35,943 $74,492
</TABLE>
<PAGE>
<PAGE> 18A
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1994
<CAPTION>
SCHEDULE XIII - CURRENT AND ACCRUED LIABILITIES
INSTRUCTIONS: Provide balance of notes and accounts payable to each associate
company. Give description and amount of miscellaneous current
and accrued liabilities. Items less than $10,000 may be grouped,
showing the number of items in each group.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
(In Thousands)
<S> <C> <C>
ACCOUNT 242 - MISCELLANEOUS CURRENT AND
ACCRUED LIABILITIES
Sub-Total Brought Forward
TOTAL $ $
<PAGE>
19
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS:
The space below is provided for important notes regarding the financial
statements or any account thereof. Furnish particulars as to any
significant contingent assets or liabilities existing at the end of the
year. Notes relating to financial statements shown elsewhere in this
report may be indicated here by reference.
1. SIGNIFICANT ACCOUNTING POLICIES:
Organization
American Electric Power Service Corporation (the Company or AEPSC)
is a wholly-owned subsidiary of American Electric Power Company, Inc.
(AEP Co., Inc.), a public utility holding company. The Company
provides certain managerial and professional services including
administrative and engineering services to the affiliated companies
in the American Electric Power (AEP) System and periodically to
unaffiliated companies.
Regulation and Basis of Accounting
As a subsidiary of AEP Co., Inc., AEPSC is subject to
regulation by the Securities and Exchange Commission (SEC) under
the Public Utility Holding Company Act of 1935 (1935 Act).
The Company's accounting conforms to the Uniform System of
Accounts for Mutual and Subsidiary Service Companies prescribed by
the SEC pursuant to the 1935 Act. As a cost-based rate-regulated
entity, AEPSC's financial statements reflect the actions of the
regulators that result in the recognition of revenues and expenses
in different time periods than enterprises that are not rate
regulated. In accordance with Statement of Financial Accounting
Standards (SFAS) No. 71, "Accounting for the Effects of Certain
Types of Regulation" (SFAS 71), the financial statements include
assets (deferred expenses) and liabilities (deferred income)
recorded in accordance with regulatory actions to match expenses
and revenues in cost-based rates.
Regulatory assets are expected to be recovered in future
periods through billings to affiliated companies and the
regulatory liabilities are expected to reduce future
billings. The Company has reviewed all the evidence
currently available and concluded that it continues to meet
the requirements to apply SFAS 71. Among other things application
of SFAS 71 requires that the Company's billing rates be cost-based
regulated. In the event a portion of the Company's business
were to no longer meet those requirements,
(Cont'd)
<PAGE>
<PAGE> 19A
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important
notes regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the end of the
year. Notes relating to financial statements shown
elsewhere in this report may be indicated here by reference.
net regulatory assets would have to be written off for that
portion of the business and long-term assets would have to be
tested for possible impairment.
Recognized regulatory assets and liabilities are comprised
of the following:
December 31,
1998 1997
Regulatory Assets: (In Thousands)
Unamortized Loss on Reacquired Debt $4,445 $5,105
Postretirement Benefits 1,297 1,621
Postemployment Benefits 2,572 1,881
Total Regulatory Assets $8,314 $8,607
Regulatory Liabilities:
Deferred Amounts Due to Affiliates
for Income Tax Benefits $7,291 $7,241
Deferred Investment Tax Credits 1,004 1,054
Total Regulatory Liabilities $8,295 $8,295
Use of Estimates
The preparation of these financial statements in conformity
with generally accepted accounting principles requires in
certain instances the use of management's estimates. Actual
results could differ from those estimates.
Income and Expenses
Services rendered to both affiliated and unaffiliated companies
are provided at cost. The charges for services include no
compensation for the use of equity capital, all of which is
furnished by AEP Co., Inc. The costs of the services are
determined on a direct charge basis to the extent practicable
and on reasonable bases of proration for indirect costs.
(Cont'd)
<PAGE>
<PAGE>
19B
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any
significant contingent assets or liabilities
existing at the end of the year. Notes relating
to financial statements shown elsewhere in this
report may be indicated here by reference.
Income Taxes
The Company follows the liability method of accounting for
income taxes as prescribed by SFAS 109, "Accounting for Income
Taxes." Under the liability method, deferred income taxes are
provided for all temporary differences between book cost and
tax basis of assets and liabilities which will result in a
future tax consequence. Where the flow-through method of
accounting for temporary differences is reflected in billings,
regulatory assets and liabilities are recorded in accordance
with SFAS 71.
Investment Tax Credits
Investment tax credits have been accounted for under the
flow-through method unless they have been deferred in accord-
ance with regulatory treatment. Investment tax credits that
have been deferred are being amortized over the life of the
related investment.
Property
Property is stated at original cost. Land, structures and
structural improvements are generally subject to first mortgage
liens. Depreciation is provided on a straight-line basis over
the estimated useful lives of the property.
Investments
Investments include the cash surrender value of corporate
owned life insurance (COLI) policies net of policy loans and
interest accrued on the loans plus payments of disputed taxes
and interest related to COLI (see Note 2).
Debt
With SEC staff approval, gains and losses on reacquired debt
are deferred and amortized over the term of the replacement debt.
(Cont'd)<PAGE>
<PAGE>
19C
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
Debt issuance expenses are amortized over the term of the
related debt, with the amortization included in interest charges.
Reclassifications
Certain prior-period amounts were reclassified to con-
form with current-period presentation.
Comprehensive Income
There were no material differences between net income
and comprehensive income.
2. COMMITMENTS AND CONTINGENCIES:
Litigation
The Internal Revenue Service (IRS) agents auditing the
AEP System's consolidated federal income tax returns for
the years 1991 to 1993 requested a ruling from their
National Office that certain interest deductions claimed
by the Company relating to AEP's COLI program should not
be allowed. As a result of a suit filed by the Company
in US District Court (discussed below) this request for
ruling was withdrawn by the IRS agents. Adjustments have
been or will be proposed by the IRS disallowing COLI
interest deductions for taxable years 1991-96. A dis-
allowance of the COLI interest deductions through
December 31, 1998 would increase expenses by $37 million
which would be billed to affiliated companies.
In 1997 and 1998 the Company made payments of taxes and
interest attributable to COLI interest deductions for
taxable years 1991-97 to avoid the potential assessment by
the IRS of any additional above market rate interest on
the contested amount. The payments to the IRS are included
on the balance sheet in other investments pending the resolution
of this matter. The Company will seek refund, either
administratively, or through litigation, of all amounts paid
plus interest. In order to resolve this issue without
(Cont'd)
<PAGE>
<PAGE>
19D
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
further delay, on March 24, 1998, the Company filed suit
against the US in the US District Court for the Southern
District of Ohio. Management believes that it has a
meritorious position and will vigorously pursue this lawsuit.
In the event the resolution of this matter is unfavorable,
the unfavorable effect would be recovered through billings to
affiliated companies.
The Company is involved in a number of other legal pro-
ceedings and claims. While management is unable to predict
the outcome of litigation these matters, any potential liability
which may result therefrom would be recoverable from affiliated
client companies.
3. BENEFIT PLANS:
The Company and its subsidiaries participate in the AEP
System qualified pension plan, a defined benefit plan which
covers all employees. Net pension plan costs for the years
ended December 31, 1998 and 1997 were $6.3 million and $4.0
million, respectively.
Postretirement Benefits Other Than Pensions are provided
for retired employees for medical and death benefits under an AEP
System plan. The annual accrued costs were $9.7 million in 1998
and $8.7 million in 1997.
A defined contribution employee savings plan required that
the Company make contributions to this plan totaling $5.5
million in 1998 and $4.6 million in 1997.
4. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
The carrying amount of cash, accounts receivable and
accounts payable approximates fair value because of the
short-term maturities of these instruments. At December 31,
1998 and 1997 the fair value of long-term debt was $68
million and $87 million, respectively, based on quoted
market prices for similar issues and current interest rates
offered for debt of the same remaining maturities. The
(Cont'd)<PAGE>
<PAGE>
19E
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
carrying amount for long-term debt was $66 million and $71
million at December 31, 1998 and 1997, respectively.
The Company is subject to market risk as a result of
changes in interest rates primarily due to short-term and
long-term borrowings used to fund its business operations.
The debt portfolio has fixed and variable interest rates
with terms from one day to ten years at December 31, 1998.
A near term change in interest rates should not materially
affect results of operations or financial position since
the Company would not expect to liquidate its entire debt
portfolio in a one year holding period. Also since the
Company's rates are cost-based regulated, the risk of
interest rate changes on short-term and long-term debt used
to finance operations is mitigated.
5. FEDERAL INCOME TAXES:
The details of federal income taxes as reported are as
follows:
Year Ended December 31,
1998 1997
(In Thousands)
Current (net)................... $10,842 $ 6,296
Deferred (net).................. (14,620) (9,327)
Deferred Investment Tax Credits
(net)........................ (50) (51)
Total Federal Income Tax
Credit..................... $(3,828) $(3,082)
Federal income taxes as reported are different than the pre-
tax book loss multiplied by the statutory federal income tax rate
predominantly due to non-taxable income related to corporate owned
life insurance and amortization of deferred investment tax credits.
(Cont'd)<PAGE>
<PAGE>
19F
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
The following tables show the elements of the net deferred
tax asset or liability and the significant temporary differ-
ences giving rise to such deferrals:
December 31,
1998 1997
(In Thousands)
Deferred Tax Assets..................... $ 58,748 $ 41,537
Deferred Tax Liabilities................ (30,995) (28,512)
Net Deferred Tax Asset................ $ 27,753 $ 13,025
Property Related Temporary Differences.. $(26,367) $(26,197)
Accrued Pension Expense................. 16,230 14,013
Accrued Vacation Pay.................... 7,017 4,612
Deferred and Accrued Compensation....... 20,170 13,682
Amounts Due to Affiliates for
Future Income Tax..................... 2,471 2,519
All Other (net)......................... 8,232 4,396
Net Deferred Tax Asset................ $ 27,753 $ 13,025
The Company joins in the filing of a consolidated federal
income tax return with its affiliates in the AEP System. The
allocation of the AEP System's current consolidated federal
income tax to the System companies is in accordance with SEC
rules under the 1935 Act. These rules permit the allocation
of the benefit of current tax losses utilized to the System
companies giving rise to them in determining their current
tax expense. The tax loss of the System parent company, AEP
Co., Inc., is allocated to its subsidiaries with taxable
income. With the exception of the loss of the parent company,
the method of allocation approximates a separate return result
for each company in the consolidated group.
The AEP System has settled with the IRS all issues from
the audits of the consolidated federal income tax returns
for the years prior to 1991. Returns for the years 1991
through 1996 are presently being audited by the IRS. With
the exception of the deductibility of interest deductions
related to AEP's corporate owned life insurance program,
which are discussed under the heading, Litigation, in Note 2,
management is not aware of any issues for open tax years that
(Cont'd)<PAGE>
<PAGE>
19G
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
upon final resolution are expected to have a material adverse
effect on results of operations.
6. LONG-TERM DEBT:
Long-term debt was outstanding as follows:
December 31,
Interest 1998 1997
Rate (In Thousands)
Notes Payable to Banks:
Due October 1998.......... 5.29% $ -- $10,000
Due October 2003.......... 6.355% 10,000 --
Mortgage Notes:
Series D(a)............... 9.00% 2,500 5,000
Series E(b)............... 9.60% 52,500 55,000
Advances from Parent Company. (c) 1,100 1,100
66,100 71,100
Less Portion Due Within One Year 5,000 15,000
Total...................... $61,100 $56,100
(a) Due in annual installments of $2,500,000 until December 1999.
(b) Due in annual installments of $2,500,000 until December 1999,
$2,000,000 from 2000-2007 and the balance in December 2008.
(c) The advances from parent company are non-interest bearing and
have no due date.
Long-term debt outstanding at December 31, 1998 is payable
as follows:
Principal
Amount
(In Thousands)
1999...................................... $ 5,000
2000...................................... 2,000
2001...................................... 2,000
2002...................................... 2,000
2003...................................... 12,000
Later Years............................... 43,100
Total................................... $66,100
(Cont'd)<PAGE>
<PAGE>
19H
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
The weighed average interest rate for Short-term Debt - Notes
Payable is 5.62% at December 31, 1998.
7. LEASES:
Leases of structures, improvements, office furniture and
miscellaneous equipment are for periods of up to 30 years and
require payments of related property taxes, maintenance and
operating costs. The majority of the leases have purchase or
renewal options and will be renewed or replaced by other
leases.
The components of rental costs are as follows:
Year Ended December 31,
1998 1997
(In Thousands)
Operating Leases.................$11,373 $10,769
Amortization of Capital Leases... 18,183 12,807
Interest on Capital Leases....... 5,058 5,073
Total Rental Costs...........$34,614 $28,649
Property under capital leases and related obligations
recorded on the Balance Sheets are as follows:
December 31,
1998 1997
(In Thousands)
Property Under Capital Leases:
Structures and Improvements.......... $ 11,750 $11,750
Office Furniture and Miscellaneous
Equipment.......................... 89,699 69,955
Total Property Under Capital Leases 101,449 81,705
Accumulated Amortization............... 31,905 21,231
Net Property Under Capital Leases.... $ 69,544 $60,474
Capital Lease Obligations: *
Noncurrent Liability....................$ 50,947 $46,363
Liability Due Within One Year........ 18,597 14,111
Total Capital Lease Obligations.... $ 69,544 $60,474
(Cont'd)<PAGE>
<PAGE>
19I
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
* Represents the present value of future minimum lease
payments.
Properties under operating leases and related obligations
are not included in the Balance Sheets.
Future minimum lease rentals consisted of the following at
December 31, 1998:
Noncancelable
Capital Operating
Leases Leases
(In Thousands)
1999............................. $23,002 $ 398
2000............................. 19,379 157
2001............................. 14,472 167
2002............................. 9,382 167
2003............................. 4,044 167
Later Years...................... 19,857 14
Total Future Minimum Lease
Rentals........................ 90,136 $1,070
Less Estimated Interest Element.. 20,592
Estimated Present Value of Future
Minimum Lease Rentals.......... $69,544
<PAGE>
<PAGE>
</TABLE>
<TABLE>
20
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE XV
STATEMENT OF INCOME
ACCOUNT D E S C R I P T I O N CURRENT YEAR PRIOR YEAR
(In Thousands)
<S> <C> <C>
INCOME
457 Services rendered to associate companies $564,888 $455,856
458 Services rendered to nonassociate
companies 912 209
421 Miscellaneous income or loss 342 405
Total Income 566,142 456,470
EXPENSE
920 Salaries and wages 297,039 228,151
921 Office supplies and expenses 44,433 40,130
922 Administrative expense transferred - credit (1,072) (1,060)
923 Outside services employed 98,547 84,671
924 Property insurance 67 123
925 Injuries and damages 1,371 1,184
926 Employee pensions and benefits 49,225 39,288
928 Regulatory commission expense -- --
930.1 General advertising expenses -- --
930.2 Miscellaneous general expenses 3,120 1,473
931 Rents 34,199 28,010
932 Maintenance of structures and equipment 4,641 3,356
403 Depreciation and amortization expense 4,151 4,006
408 Taxes other than income taxes 21,114 18,796
409 Income taxes 13,046 7,244
410 Provision for deferred income taxes 17,955 13,896
411 Provision for deferred income taxes - credit (32,575) (23,223)
411.5 Investment tax credit (50) (51)
426.1 Donations 1,487 1,236
426.5 Other deductions 1,880 1,863
427 Interest on long-term debt 6,266 6,693
430 Interest on debt to associate companies -- --
431 Other interest expense 1,298 684
Total Expense 566,142 456,470
Net Income or (Loss) $ -0- $ -0-
</TABLE>
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
21
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
ANALYSIS OF BILLING
ASSOCIATE COMPANIES
ACCOUNT 457
DIRECT INDIRECT COMPENSATION TOTAL
NAME OF ASSOCIATE COMPANY COSTS COSTS FOR USE OF AMOUNT
CHARGED CHARGED CAPITAL BILLED
457-1 457-2 457-3
(In Thousands)
<S> <C> <C> <C> <C>
Associate Companies
AEP Communications, Inc. $ 1,014 $ 139 $ 4 $ 1,157
AEP Communications, LLC 3,004 510 -- 3,514
AEP Energy Services, Inc. 5,960 851 12 6,823
AEP Generating Company 3,500 420 11 3,931
AEP Investments, Inc. 27 5 -- 32
AEP Pushan Power, LDC 210 17 2 229
AEP Resources, Inc. 10,148 1,249 19 11,416
AEP Resources Delaware, Inc. 5 1 -- 6
AEP Resources Gas Holding Company 34 7 -- 41
AEP Resources International, Limited 34 4 -- 38
AEP Resources Limited 128 17 -- 145
AEP Resources Project Mgmt. Co., Ltd. 6 1 -- 7
AEP Resources Service Company 1,940 305 6 2,251
AEP Resources Ventures, Inc. 1 -- -- 1
American Electric Power Company, Inc. 12,854 2,090 6 14,950
Appalachian Power Company 118,827 14,157 257 133,241
Appalachian/Ohio Power Joint
Account (Amos) 9,628 986 29 10,643
Appalachian/Ohio Power Joint
Account (Sporn) 5,205 531 24 5,760
Blackhawk Coal Company 12 2 -- 14
Cardinal Operating Company 7,078 796 21 7,895
Cedar Coal Co. 29 5 -- 34
Central Appalachian Coal Company 2 -- -- 2
Central Coal Company 5 1 -- 6
Central Ohio Coal Company 1,462 268 5 1,735
Columbus Southern Power Company 70,303 7,752 153 78,208
Conesville Coal Preparation Company 519 105 1 625
Indiana Michigan Power Company 77,290 8,957 167 86,414
Indiana Michigan Power-
Water Transportation 745 104 2 851
Indiana Michigan Power/AEP Generating
Joint Account (Rockport) 6,805 962 19 7,786
Kentucky Power Company 27,532 3,619 70 31,221
Kingsport Power Company 3,389 384 8 3,781
Louisiana Interstate Gas Company, L.L.C. 1 -- -- 1
Ohio Power Company 122,434 13,511 276 136,221
Ohio Power Company-Cook Coal Terminal 466 99 1 566
Ohio Power Company (Gavin) 340 44 1 385
Simco Inc. 2 -- -- 2
Southern Appalachian Coal Company 6 1 -- 7
SUB-TOTAL 490,945 57,900 1,094 549,939
(Cont'd)<PAGE>
</TABLE>
<PAGE> 21A
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
ANALYSIS OF BILLING
ASSOCIATE COMPANIES
ACCOUNT 457
DIRECT INDIRECT COMPENSATION TOTAL
NAME OF ASSOCIATE COMPANY COSTS COSTS FOR USE OF AMOUNT
CHARGED CHARGED CAPITAL BILLED
457-1 457-2 457-3
(In Thousands)
<S> <C> <C> <C> <C>
Sub-Total Brought Forward 490,945 57,900 1,094 549,939
Southern Ohio Coal Company 5,724 1,076 16 6,816
Wheeling Power Company 3,366 355 9 3,730
Windsor Coal Company 1,966 369 6 2,341
Unbilled Revenues (243) -- -- (243)
Statutory Subsidiaries
Indiana-Kentucky Electric Corporation 851 189 2 1,042
Ohio Valley Electric Corporation 1,040 221 2 1,263
TOTAL $503,649 $60,110 $1,129 $564,888 <PAGE>
</TABLE>
<PAGE>
<TABLE> 22
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
ANALYSIS OF BILLING
NONASSOCIATE COMPANIES
ACCOUNT 458
DIRECT INDIRECT COMPENSATION EXCESS
TOTAL
NAME OF NONASSOCIATE COMPANY COST COST FOR USE TOTAL OR AMOUNT
CHARGED CHARGED CAPITAL COST DEFICIENCY BILLED
458-1 458-2 458-3 458-4
(In Thousands)
<S> <C> <C> <C> <C> <C> <C>
East Central Area Reliability
Coordination Agreement
Power System $724 $157 $-- $881 $-- $881
Cincinnati Gas & Electric (Zimmer
Service Agreement) 12 3 -- 15 -- 15
Associated Electric Cooperative, Inc. 6 1 -- 7 -- 7
Cinergy Corporation 3 1 -- 4 -- 4
Ormet Aluminum Company 3 -- -- 3 -- 3
Dayton Power and Light Company 2 -- -- 2 -- 2
Ohio Edison Company 1 -- -- 1 -- 1
West Penn Power Company 1 -- -- 1 -- 1
ABB Systems Control, Inc. (2) -- -- (2) -- (2)
TOTAL $750 $162 $-0- $912 $-0- $912
INSTRUCTION: Provide a brief description of the services rendered to each nonassociate company:
Engineering and computer services.
</TABLE>
<PAGE>
<TABLE>
23
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE XVI
ANALYSIS OF CHARGES FOR SERVICE
ASSOCIATE AND NONASSOCIATE COMPANIES
ASSOCIATE COMPANY CHARGES NONASSOCIATE COMPANY
CHARGES
DESCRIPTION OF ITEMS DIRECT INDIRECT DIRECT INDIRECT
COST COST TOTAL COST COST TOTAL
(In Thousands)
<S> <C> <C> <C> <C> <C> <C>
920 SALARIES AND WAGES $290,848 $ 5,577 $296,425 $598 $ 16 $614
921 OFFICE SUPPLIES AND EXPENSES 34,147 10,256 44,403 2 28 30
922 ADMINISTRATIVE EXPENSE
TRANSFERRED-CREDIT (1,072) -- (1,072) -- -- --
923 OUTSIDE SERVICES EMPLOYED 95,218 3,319 98,537 -- 10 10
924 PROPERTY INSURANCE (6) 73 67 -- -- --
925 INJURIES AND DAMAGES 1,368 3 1,371 -- -- --
926 EMPLOYEE PENSIONS AND BENEFITS 40,701 8,355 49,056 146 23 169
928 REGULATORY COMMISSION EXPENSE -- -- -- -- -- --
930.1 GENERAL ADVERTISING EXPENSES -- -- -- -- -- --
930.2 MISCELLANEOUS GENERAL EXPENSES 2,920 200 3,120 -- -- --
931 RENTS 17,418 16,738 34,156 -- 43 43
932 MAINTENANCE OF STRUCTURES AND EQUIPMENT 3,398 1,240 4,638 -- 3 3
403 DEPRECIATION AND AMORTIZATION EXPENSE (595) 4,733 4,138 -- 13 13
408 TAXES OTHER THAN INCOME TAXES 18,522 2,582 21,104 4 6 10
409 INCOME TAXES 13,046 -- 13,046 -- -- --
410 PROVISION FOR DEFERRED INCOME TAXES 17,955 -- 17,955 -- -- --
411 PROVISION FOR DEFERRED INCOME
TAXES-CREDIT (32,575) -- (32,575) -- -- --
411.5 INVESTMENT TAX CREDIT (50) -- (50) -- -- --
426.1 DONATIONS 1,487 -- 1,487 -- -- --
426.5 OTHER DEDUCTIONS 1,880 -- 1,880 -- -- --
427 INTEREST ON LONG-TERM DEBT (290) 6,538 6,248 -- 18 18
431 OTHER INTEREST EXPENSE 517 779 1,296 -- 2 2
INSTRUCTION: Total cost of service
will equal for associate and
nonassociate companies the total
amount billed under their separate
analysis of billing schedules.
TOTAL EXPENSES = 504,837 60,393 565,230 750 162 912
421 MISCELLANEOUS INCOME (59) (283) (342) -- -- --
TOTAL EXPENSES = $504,778 $60,110 $564,888 $750 $162 $912
COMPENSATION FOR USE OF
EQUITY CAPITAL = -- -- -- -- -- --
430 INTEREST ON DEBT TO
ASSOCIATE COMPANIES= -- -- -- -- -- --
TOTAL COST OF SERVICE = $504,778 $60,110 $564,888 $750 $162 $912
(Cont'd)<PAGE>
</TABLE>
<PAGE>
<TABLE>
23A
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE XVI
ANALYSIS OF CHARGES FOR SERVICE
ASSOCIATE AND NONASSOCIATE COMPANIES
TOTAL CHARGES FOR
SERVICE
DESCRIPTION OF ITEMS DIRECT INDIRECT
COST COST TOTAL
(In Thousands)
<S> <C> <C> <C>
920 SALARIES AND WAGES $291,446 $ 5,593 $297,039
921 OFFICE SUPPLIES AND EXPENSES 34,149 10,284 44,434
922 ADMINISTRATIVE EXPENSE TRANSFERRED-CREDIT (1,072) -- (1,072)
923 OUTSIDE SERVICES EMPLOYED 95,218 3,329 98,547
924 PROPERTY INSURANCE (6) 73 67
925 INJURIES AND DAMAGES 1,368 3 1,371
926 EMPLOYEE PENSIONS AND BENEFITS 40,847 8,378 49,225
928 REGULATORY COMMISSION EXPENSE -- -- --
930.1 GENERAL ADVERTISING EXPENSES -- -- --
930.2 MISCELLANEOUS GENERAL EXPENSES 2,920 200 3,120
931 RENTS 17,418 16,781 34,199
932 MAINTENANCE OF STRUCTURES AND EQUIPMENT 3,398 1,243 4,641
403 DEPRECIATION AND AMORTIZATION EXPENSE (595) 4,746 4,151
408 TAXES OTHER THAN INCOME TAXES 18,526 2,588 21,114
409 INCOME TAXES 13,046 -- 13,046
410 PROVISION FOR DEFERRED INCOME TAXES 17,955 -- 17,955
411 PROVISION FOR DEFERRED INCOME TAXES-CREDIT (32,575) -- (32,575)
411.5 INVESTMENT TAX CREDIT (50) -- (50)
426.1 DONATIONS 1,487 -- 1,487
426.5 OTHER DEDUCTIONS 1,880 -- 1,880
427 INTEREST ON LONG-TERM DEBT (290) 6,556 6,266
431 OTHER INTEREST EXPENSE 517 781 1,298
INSTRUCTION: Total cost of service will equal for
associate and nonassociate companies the total
amount billed under their separate analysis of
billing schedules.
TOTAL EXPENSES = 505,587 60,555 566,142
421 MISCELLANEOUS INCOME (59) (283) (342)
TOTAL EXPENSES = $505,528 $60,272 $565,800
COMPENSATION FOR USE OF EQUITY CAPITAL = -- -- --
430 INTEREST ON DEBT TO ASSOCIATE COMPANIES= -- -- --
TOTAL COST OF SERVICE = $505,528 $60,272 $565,800 <PAGE>
</TABLE>
<PAGE>
<TABLE>
24
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
CORPORATE
CORPORATE
D E S C R I P T I O N O F I T E M S TOTAL CONSUMER CORPORATE COMMUNI- DEVELOP-
CATIONS MENT
AMOUNT OVERHEAD SERVICES
ACCOUNTING
(In Thousands)
<S> <C> <C> <C> <C> <C> <C>
920 SALARIES AND WAGES $297,039 $ 5,273 $21,678 $15,937 $4,325 $ 8,725
921 OFFICE SUPPLIES AND EXPENSES 44,433 8,696 3,358 786 1,272 1,182
922 ADMINISTRATIVE EXPENSE TRANSFERRED
- CREDIT (1,072) -- -- (14) (163) (4)
923 OUTSIDE SERVICES EMPLOYED 98,547 2,498 4,902 2,697 622 450
924 PROPERTY INSURANCE 67 73 -- -- -- --
925 INJURIES AND DAMAGES 1,371 3 100 68 17 30
926 EMPLOYEE PENSIONS AND BENEFITS 49,225 5,896 3,932 2,763 601 1,182
928 REGULATORY COMMISSION EXPENSE -- -- -- -- -- --
930.1 GENERAL ADVERTISING EXPENSES -- -- -- -- -- --
930.2 MISCELLANEOUS GENERAL EXPENSES 3,120 53 376 3 132 12
931 RENTS 34,199 2,647 881 1,715 170 103
932 MAINTENANCE OF STRUCTURES AND
EQUIPMENT 4,641 1,150 3 28 -- --
403 DEPRECIATION AND AMORTIZATION
EXPENSE 4,151 4,432 -- -- -- --
408 TAXES OTHER THAN INCOME TAXES 21,114 2,098 1,545 1,076 244 434
409 INCOME TAXES 13,046 -- -- (5) -- --
410 PROVISION FOR DEFERRED INCOME TAXES 17,955 -- -- -- -- --
411 PROVISION FOR DEFERRED INCOME TAXES -
CREDIT (32,575) -- -- -- -- --
411.5 INVESTMENT TAX CREDIT (50) -- -- -- -- --
426.1 DONATIONS 1,487 -- 4 1 11 --
426.5 OTHER DEDUCTIONS 1,880 -- 4 14 323 4
427 INTEREST ON LONG-TERM DEBT 6,266 6,168 -- -- -- --
430 INTEREST ON DEBT TO ASSOCIATE
COMPANIES -- -- -- -- -- --
431 OTHER INTEREST EXPENSE 1,298 731 -- -- -- --
INSTRUCTION: Indicate each department or
service function. (see Instruction 01-3
General Structure of Accounting System:
Uniform System of Accounts)
TOTAL EXPENSES = $566,142 $39,718 $36,783 $25,069 $7,554 $12,118
</TABLE>
<PAGE>
<PAGE>
<TABLE>
25
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
D E P A R T M E N T O R S E R V I C E F U N C T I O N
CORPORATE ENERGY ENERGY ENERGY ENERGY ENERGY ENVIRON-
ACCOUNT PLANNING & CORPORATE DELIVERY DISTRI- PRIC.& REG. SERV. & TRANS- MENTAL EXECUTIVE
NUMBER BUDGETING SERVICES SUPPORT BUTION SERVICES PWR. MKT. MISSION SERVICES GROUP FINANCE
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
920 $2,108 $ 2,600 $13,151 $4,327 $2,759 $33,934 $13,134 $4,918 $11,862 $3,172
921 125 9,425 3,577 239 177 537 591 441 1,713 536
922 -- (1) (5) -- (1) -- -- (7) (866) --
923 1,920 115 1,533 1,686 325 474 2,450 223 4,809 162
924 -- -- -- -- -- -- -- -- -- --
925 7 21 71 13 9 34 76 20 43 23
926 300 440 2,118 620 388 1,382 2,113 839 2,251 448
928 -- -- -- -- -- -- -- -- -- --
930.1 -- -- -- -- -- -- -- -- -- --
930.2 1,444 1 84 7 -- 51 29 4 663 36
931 73 371 1,995 323 45 391 681 168 1,645 27
932 -- 10 440 4 -- 57 -- 56 109 --
403 -- 13 -- -- -- -- -- -- -- --
408 110 639 818 245 142 522 821 322 750 186
409 -- -- -- -- -- -- -- -- -- 1
410 -- -- -- -- -- -- -- -- -- --
411 -- -- -- -- -- -- -- -- -- --
411.5 -- -- -- -- -- -- -- -- -- --
426.1 -- -- 5 -- -- -- -- 6 1,283 --
426.5 -- 6 -- -- -- 1 10 -- 1 1,503 --
427 -- -- -- -- -- -- -- -- -- 536
430 -- -- -- -- -- -- -- -- -- --
431 -- -- -- -- -- -- -- -- -- 612
$6,087 $13,640 $23,787 $7,464 $3,845 $37,392 $19,895 $6,991 $25,765 $5,739
(Cont'd)
</TABLE>
<PAGE>
<PAGE> 25A
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
D E P A R T M E N T O R S E R V I C E F U N C T I O N
FOSSIL INFOR- NORTHERN NORTHERN POWER
ACCOUNT & HYDRO FUEL HUMAN MATION INTERNAL RSO RSO NUCLEAR GENERATION
NUMBER PROD. SUPPLY RESOURCES TECH. AUDITS LEGAL PRODUCTION SUPPORT GENERATION ENGINEERING
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
920 $ 8,948 $6,806 $15,350 $ 31,401 $3,126 $5,230 $13,962 $2,898 $ 925 $21,962
921 712 431 1,223 2,714 291 389 939 486 42 1,521
922 -- (8) -- -- -- -- -- -- -- (3)
923 884 461 2,284 67,796 196 398 5 145 3 212
924 -- -- (6) -- -- -- -- -- -- --
925 30 23 67 138 13 17 62 12 1 84
926 1,353 1,015 2,919 5,173 547 712 1,749 462 70 3,521
928 -- -- -- -- -- -- -- -- -- --
930.1 -- -- -- -- -- -- -- -- -- --
930.2 7 43 22 7 2 3 6 -- -- 53
931 143 71 1,283 18,336 60 312 111 66 14 721
932 3 -- (71) 2,712 -- -- 17 20 -- 10
403 -- -- (315) -- -- -- -- -- -- --
408 514 358 945 2,126 202 240 1,000 173 36 1,376
409 -- -- -- -- -- -- -- -- -- --
410 -- -- -- -- -- -- -- -- -- --
411 -- -- -- -- -- -- -- -- -- --
411.5 -- -- -- -- -- -- -- -- -- --
426.1 -- 65 100 -- -- -- -- 1 -- --
426.5 -- 5 2 -- -- -- -- -- 3 3
427 -- -- (438) -- -- -- -- -- -- --
430 -- -- -- -- -- -- -- -- -- --
431 -- -- (51) -- -- -- -- -- -- --
$12,594 $9,270 $23,314 $130,403 $4,437 $7,301 $17,851 $4,263 $1,094 $29,460
(Cont'd)
RSO = Regional Service Organization
</TABLE>
<PAGE>
<PAGE>
<TABLE>
25B
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
D E P A R T M E N T O R S E R V I C E F U N C T I O N
PROCUREMENT SOUTHERN SOUTHERN
ACCOUNT & SUPPLY RSO RSO SYSTEM
NUMBER CHAIN PRODUCTION SUPPORT PLANNING TAX
(In Thousands)
<S> <C> <C> <C> <C> <C>
920 $5,344 $14,137 $10,149 $6,606 $2,292
921 205 943 1,583 119 180
922 -- -- -- -- --
923 123 39 431 159 545
924 -- -- -- -- --
925 20 192 135 34 8
926 897 2,238 1,963 1,014 319
928 -- -- -- -- --
930.1 -- -- -- -- --
930.2 1 -- 4 66 11
931 337 99 956 361 94
932 -- 22 71 -- --
403 -- -- 21 -- --
408 342 1,041 717 388 1,704
409 -- -- -- -- 13,050
410 -- -- -- -- 17,955
411 -- -- -- -- (32,575)
411.5 -- -- -- -- (50)
426.1 -- -- 11 -- --
426.5 -- -- 1 -- --
427 -- -- -- -- --
430 -- -- -- -- --
431 -- -- -- -- 6
$7,269 $18,711 $16,042 $8,747 $3,539
RSO = Regional Service Organization
</TABLE>
<PAGE>
<TABLE>
26
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
DEPARTMENTAL ANALYSIS OF SALARIES
ACCOUNT 920
DEPARTMENTAL SALARY EXPENSE NUMBER
NAME OF DEPARTMENT INCLUDED IN AMOUNTS BILLED TO PERSONNEL
Indicate each department or TOTAL PARENT OTHER NON END OF
service function. AMOUNT COMPANY ASSOCIATES ASSOCIATES YEAR
(In Thousands)
<S> <C> <C> <C> <C> <C>
Service Groups (Overheads) $ 5,273 $ 210 $ 5,047 $ 16 157
Consumer Services 21,678 304 21,374 -- 171
Corporate Accounting 15,937 476 15,461 -- 252
Corporate Communications 4,325 286 4,039 -- 53
Corporate Development 8,725 771 7,952 2 81
Corporate Planning & Budgeting 2,108 559 1,549 -- 22
Corporate Services 2,600 83 2,517 -- 17
Energy Delivery Support 13,151 294 12,857 -- 156
Energy Distribution 4,327 112 4,215 -- 49
Energy Pricing & Regulatory
Services 2,759 442 2,317 -- 31
Energy Services & Power
Marketing 33,934 113 33,821 -- 107
Energy Transmission 13,134 191 12,943 -- 181
Environmental Services 4,918 47 4,871 -- 73
Executive Group 11,862 898 10,561 403 116
Finance 3,172 360 2,812 -- 43
Fossil & Hydro Production 8,948 203 8,745 -- 85
Fuel Supply 6,806 116 6,685 5 78
Human Resources 15,350 960 14,390 -- 123
Information Technology 31,401 750 12,487 164 527
Internal Audits 3,126 86 3,040 -- 44
Legal 5,230 561 4,668 1 43
Northern RSO Production 13,962 -- 13,962 -- 244
Northern RSO Support 2,898 -- 2,898 -- 230
Nuclear Generation 925 9 916 -- 2
Power Generation Engineering 21,962 56 21,896 10 292
Procurement & Supply Chain 5,344 123 5,221 -- 73
Southern RSO Production 14,137 -- 14,137 -- 33
Southern RSO Support 10,149 2 10,146 1 77
System Planning 6,606 399 6,195 12 75
Tax 2,292 65 2,227 -- 24
TOTAL $297,039 $8,476 $269,949 $614 3,459
</TABLE>
<PAGE>
<TABLE>
27
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
<S> <C> <C>
3X Corporation NA $ 251
Professional services fees for computer programmers/systems analysts.
ABB Power T&D Company, Inc. NA 1,281
Professional services fees for creating and installing new software programs
and maintenance.
ABS Consulting, Inc. NA 129
Professional services fees for computer programmers/systems analysts.
AES International Corporation NA 423
Personal computer link to Smallworld.
Abby Lane/Dana Temporaries, Inc. NA 324
Temporary office help.
Advanced Programming Resources, Inc. NA 338
Professional services fees for computer programmers/systems analysts.
Alliance Systems, Inc. NA 211
Professional services fees for computer programmer and expenses.
America's Registry, Inc. NA 2,834
Professional services fees for computer programmers/systems analysts.
Ameritech NA 365
Software materials and supplies.
Analysts International Corporation NA 816
Professional services fees for computer programmers/systems analysts.
Apex Data Services, Inc. NA 122
Professional consulting services fees for conversion plan of a data based program.
(Cont'd)
<PAGE>
<PAGE>
27A
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Applied Performance Technologies, Inc. NA 494
Professional services fees for computer programmers/systems analysts.
Arbor Software Corporation NA (160)
Fees for decision support software (including reversal of prior year accrual).
ASAP Software Express, Inc. NA 1,655
Personal computer software and license fees.
Asplundh Tree Expert Company NA 159
Tree trimming and tree removal.
BBA Energy Services NA 226
Materials for the Transmission Line Mechanic Learning Guide.
Banctec Systems, Inc. NA 273
Maintenance and supplies for data processing.
BEA Systems, Inc. NA 103
Canned software product used to access the oracle database.
Beacon Application Services Corporation NA 511
Professional services for management consulting and report writing.
Behavioral Science Technology, Inc. NA 173
Professional consulting services fees for implementation of training
for behavior based safety programs.
Bentley Systems, Inc. NA 208
Software maintenance fees.
CDI Corporation NA 490
Professional services fees for design and drafting services.
(Cont'd)
<PAGE>
<PAGE>
27B
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
CSC Consulting, Inc. NA 460
Professional services fees for computer programmers/systems analysts.
CSC Index, Inc. NA 1,586
Professional services fees for computer programmers and expenses.
Candle Corporation NA 572
Professional license and maintenance fees for personal computers.
CAP Gemini America NA 869
Professional services fees for computer programmers/systems analysts.
Cardinal Operating Company A 385
Installation of a Selective Non-Catalytic Reduction system.
Cegelec ESCA Corporation NA 124
Professional services fees for the installation, training & customization
of personal computer software.
Cendant Mobility Services Corporation NA 2,021
Service fees for the purchase and sale of the homes of relocated employees.
Ceridian Tesseract Advanced HRMS
Solutions, Inc. NA 211
Annual maintenance fees.
Claremont Technology Group, Inc. NA 1,446
Professional services fees for computer programmers/systems analysts.
Claritas, Inc. NA 154
Renewal for Equifax license.
Clean Air Capital Markets Limited Partnership NA 160
Consulting services related to allowance tracking.
(Cont'd)
<PAGE>
<PAGE>
27C
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Complete Business Solutions, Inc. NA 658
Professional services fees for computer programmers/system analysts.
Computer Associates International, Inc. NA 732
Software license and maintenance fees plus update.
Computer Project Resources, Inc. NA 296
Professional services fees for computer programmers/systems analysts.
ComputerPeople, Inc. NA 2,987
Professional services fees for computer programmers/systems analysts.
Compuware Corporation NA 1,662
Software license fees for personal computers and database servers.
ConsulTech An Information Technology
Company, Ltd. NA 195
Professional services fees for consulting.
Coopers & Lybrand LLP NA 251
Professional services fees & reimbursable expenses for consulting.
C. W. Costello and Associates, Inc. NA 401
Professional services fees for computer programmers/systems analysts.
A. C. Coy Company NA 546
Professional services fees for computer programmers/systems analysts.
Crowe Chizek NA 265
Professional services fees for computer programmers/systems analysts.
Cyme International, Inc. NA 102
Software license agreement.
(Cont'd)<PAGE>
<PAGE>
27D
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
DDI Customer Service, Inc. NA 222
Consulting, materials and delivery charges.
DMR Consulting Group, Inc. NA 226
Professional consulting fees & reimbursable expenses.
DataSystems Group, Inc. NA 195
Professional services fees for consulting and reimbursable expenses.
Decision Support Technology, Inc. NA 195
Professional services fees and reimbursable expenses for consulting.
Deloitte & Touche LLP NA 319
Professional auditing services fees and reimbursable expenses.
R. Dorsey + Company, Inc. NA 201
Professional services fees for computer programmers/systems analysts.
Drayton Drayton & Lamar, Inc. NA 850
Professional services fees for consulting services.
Dun and Bradstreet NA 229
Market spectrum renewal.
EMC Corporation NA 219
Professional services fees for computer programmers and software.
Eagle Exhibit Services, Inc. NA 134
Display cases.
Efita Oss Solutions, Inc. NA 218
Technical support for modifying software to fit our business.
_____________________________________________________________________________________
(Cont'd)
<PAGE>
<PAGE>
27E
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Electric Power Research Institute NA (721)
Funding for research and development
(including reversal of prior year accrual).
Everest Data Research, Inc. NA 635
Professional services fees related to database management.
Excel Partners, Inc. NA 191
Professional services fees for computer programmers/systems analysts.
C. A. Falcone NA 123
Professional consulting fees and expenses.
The Franklin Computer Services Group NA 179
Professional services fees for personal computers support services.
Gartner Group, Inc. NA 262
Professional services fees for research advisory services.
General Physics Corporation NA 169
Modify existing network protector text into learning guides.
General Research NA 312
Professional services fees for computer programmers/systems analysts.
Geodata Solutions, Inc. NA 144
Professional services fees for computer programmers/systems analysts.
Geolearning, Inc. NA 114
Web based training system and registration.
Thomas Glover Associates, Inc. NA 223
Professional services fees for computer programmers/systems analysts.
(Cont'd)
<PAGE>
<PAGE>
27F
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Grosh Consulting NA 765
Professional services fees for computer programmers/systems analysts.
HFS Mobility Services, Inc. NA 241
Service fees for the purchase and sale of the homes of relocated employees.
Howard Systems International NA 205
Professional services fees for consulting services & reimbursable expenses.
Hunton and Williams NA 112
Legal fees.
Hyperion Software Corporation NA 103
Maintenance service renewal.
Implementation Partners LLC NA 150
Professional services fees for computer programmers/systems analysts.
In-Plant Techniques Company NA 388
Photocopies.
Indecon, Inc. NA 2,002
Professional services fees for computer programmers/systems analysts.
Infinity Consulting Group NA 303
Professional consulting services fees & reimbursable expenses.
Informatica Corporation NA 102
Software license and maintenance fees.
Information Builders, Inc. NA 150
Computer software maintenance.
(Cont'd)<PAGE>
<PAGE>
27G
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Information Industries, Inc. NA 316
Professional services fees for computer programmers/systems analysts.
Innovative Business Solutions, Inc. NA 221
Software license agreement.
Interactive Business Systems, Inc. NA 976
Professional services fees for computer programmers/systems analysts.
International Business Machines Corporation NA 13,140
Professional services fees for consulting services and reimbursable expenses.
Intersolv, Inc. NA 146
Personal computers software and license fees.
IS Talent NA 341
Professional services fees for computer programmers/system analysts.
Linesoft Inc. NA 732
Software license fees & development of software.
Logica, Inc. NA 210
Consulting services for transformation from a regulated to competive utility.
Manifest Solutions Corporation NA 645
Professional services fees and reimbursable expenses for computer
programmers/systems analysts.
Market Strategies, Inc. NA 516
Professional services fees in support of marketing activities.
Mastech Corporation NA 308
Professional services fees for computer programmers/systems analysts.
(Cont'd)
<PAGE>
<PAGE>
27H
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Maxim Group NA 902
Professional services fees for computer programmers/systems analysts.
Maximation, Inc. NA 1,605
Professional services fees for computer programmers/systems analysts.
MC 2 Cyberspace, LTD. NA 198
Professional services fees for computer programmers/systems analysts.
McCabe & Associates, Inc. NA 187
Software maintenance and licensing.
Mercer Management Consulting, Inc. NA 2,039
Professional services fees and reimbursable expenses for management
consulting services.
Metro Information Services NA 168
Professional services support/information systems consulting.
Mobile Data Solutions, Inc. NA 288
Software & consulting fees.
NCS of Florida, Inc. NA 173
Professional services fees for computer programmers/systems analysts.
Necho Systems Corporation NA 194
Software license fees.
Newcourt Financial USA, Inc. NA 1,304
Computer software license fees.
NewMedia, Inc. NA 1,748
Professional services fees and reimbursable expenses for computer
programmers/systems analysts.
(Cont'd)<PAGE>
<PAGE>
27I
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Novadigm, Inc. NA 104
Software license fees for server and clients.
Novatec Automations Systems NA 240
Professional services fees for computer programmers/systems analysts.
Odyssey Consulting Services, Inc. NA 718
Professional services fees for computer programmers/systems analysts.
Office Team NA 160
Temporary office help.
The Ohio State University NA 480
Educational services for management development program.
Oracle Corporation NA 2,077
Technical support fee for client/server applications.
Origin Technology in Business, Inc. NA 2,198
Professional services fees for computer programmers/systems analysts.
PVS International, Inc. NA 144
Professional services fees for computer programmers/systems analysts.
Paros Business Partners, Inc. NA 405
Professional services fees for computer programmers/systems analysts.
PeopleSoft, Inc. NA 802
Software and software support services.
Preferred Technology Solutions, Inc. NA 207
Professional services fees for computer programmers/systems analysts.
(Cont'd)
<PAGE>
<PAGE>
27J
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Price Waterhouse Coopers LLP NA 1,075
Professional services fees for consulting & reimbursable expenses.
Prima Consulting NA 364
Professional services fees for computer programmers/systems analysts.
Priority Based Control Engineering NA 154
Professional services for operation of multi-area interconnections.
Project Controls, Inc. NA 122
Professional services fees for computer programmers/systems analysts.
The ProTec Group, Inc. NA 1,095
Professional services fees for computer programmers/systems analysts.
Quick Solutions, Inc. NA 1,837
Professional services fees for computer programmers/systems analysts.
RKS Research & Consulting NA 121
National business customer assessment and surveys.
Rapidigm NA 2,336
Professional services fees for computer programmers/systems analysts.
Renaissance NA 114
Professional services fees for computer programmers/systems analysts.
Robert Half International, Inc. NA 896
Professional services fees for computer software programmers/information
technology specialists.
S4 Consulting NA 276
Educational services for management development program.
(Cont'd)
<PAGE>
<PAGE>
27K
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Sales Management Systems, Inc. NA 204
Consulting/training services in support of business development program.
Sarcom, Inc. NA 1,382
Hardware and software support for personal computers.
Siebel Systems, Inc. NA 246
Software license/consulting fees.
Smallworld Systems, Inc. NA 314
Licensing fees and software purchases.
Software AG NA 238
Software maintenance fees.
Software Architects, Inc. NA 152
Professional services fees and reimbursable expenses for computer
programmers/systems analysts.
Software Support Group NA 1,418
Professional services fees for computer programmers/systems analysts.
Source Services Corporation NA 535
Professional services fees for computer programmers/systems analysts.
Spectrum Solutions, Inc. NA 139
Professional services fees for computer programmers/systems analysts.
Spencer Stuart, Inc. NA 214
Consulting services and reimbursable expenses.
Steptoe and Johnson NA 329
Legal services.
(Cont'd)<PAGE>
<PAGE>
27L
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Sterling Software, Inc. NA 190
Software license fees and maintenance.
Strategic Resources, Inc. NA 373
Professional services fees for computer programmers/systems analysts.
Swafford Consulting, Inc. NA 215
Professional services fees for computer programmers/systems analysts.
System Innovators, Inc. NA 193
Software license fees and maintenance.
Techmate, Inc. NA 772
Professional services fees for computer programmers/systems analysts.
Teksystems NA 172
Professional services fees for end user support.
R. Thomas Consulting & Training, Inc. NA 191
Professional services fees for consulting services & reimbursable expenses.
Towers Perrin NA 350
Professional services fees for executive compensation consulting services.
US Cost, Inc. NA 139
Professional services fees for consulting/programming services &
reimbursable expenses.
Usertech NA 879
Professional services fees and expenses related to employee training.
Vinkad Services, Inc. NA 299
Professional services fees for computer programmers/systems analysts.
(Cont'd)
<PAGE>
<PAGE>
27M
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
Whitman-Hart, Inc. NA 134
Professional services fees for computer programmers/systems analysts.
Xenergy, Inc. NA 109
Professional services fees for consulting and reimbursable expenses.
Zai*Net Software, Inc. NA 117
Professional services fees for computer programmers/systems analysts
and license fees.
856 Vendors under $100,000 10,492
TOTAL $98,547
</TABLE>
<PAGE>
<PAGE>
<TABLE>
<CAPTION> 28
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
EMPLOYEE PENSIONS AND BENEFITS
ACCOUNT 926
INSTRUCTIONS: Provide a listing of each pension plan and benefit program provided
by the service company. Such listing should be limited to $25,000.
D E S C R I P T I O N AMOUNT
(In Thousands)
<S> <C>
Medical Insurance $14,975
Deferred Compensation Benefits 428
Other Postretirement Benefits 6,068
Savings Plan 5,534
Supplemental Savings Plan 313
Supplemental Pension Plan 1,382
Moving Expenses 4,628
Retirement Plan 5,322
Long-Term Disability 1,890
Group Life Insurance 5,569
Dental Insurance 1,312
Employee Educational Assistance 430
Miscellaneous 1,374
(Note: Certain line items include trustee fees.)
TOTAL $49,225
</TABLE>
<PAGE>
<PAGE>
29
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
GENERAL ADVERTISING EXPENSES
ACCOUNT 930.1
INSTRUCTIONS:
Provide a listing of the amount included in Account 930.1,
"General Advertising Expenses", classifying the items according
to the nature of the advertising and as defined in the account
definition. If a particular class includes an amount in excess
of $3,000 applicable to a single payee, show separately the name
of the payee and the aggregate amount applicable thereto.
D E S C R I P T I O N NAME OF PAYEE AMOUNT
None
TOTAL $ -0-
<PAGE>
<PAGE>
30
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
MISCELLANEOUS GENERAL EXPENSES
ACCOUNT 930.2
INSTRUCTIONS:
Provide a listing of the amount included in Account 930.2,
"Miscellaneous General Expenses", classifying such expenses
according to their nature. Payments and expenses permitted by
Section 321 (b) (2) of the Federal Election Campaign Act, as
amended by Public Law 94-283 in 1976 (2 U.S.C.S 441 (b) (2))
shall be separately classified.
D E S C R I P T I O N AMOUNT
(In Thousands)
Directors' Fees and Expenses $ 25
Dues for Company Memberships 769
Photocopy License 42
Award and Promotional Material 133
Employee Operating Idea Awards 48
Bank Service Charges 22
America Best Plant Exhibition 40
Contract Termination Fee 1,444
MV 90 Users Conference 63
Other General Expenses 534
TOTAL $3,120
<PAGE>
<PAGE>
31
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
RENTS
ACCOUNT 931
INSTRUCTIONS:
Provide a listing of the amount included in Account 931, "Rents",
classifying such expenses by major groupings of property, as defined
in the account definition of the Uniform System of Accounts.
T Y P E O F P R O P E R T Y AMOUNT
(In Thousands)
Computers and Data Processing Equipment $18,789
Microwave and Telecommunication Equipment 2,117
Office Furniture and Equipment 1,349
Office and Parking 7,480
Software 4,051
Videotex and Timesharing 413
TOTAL $34,199
<PAGE> 32
[CAPTION]
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
TAXES OTHER THAN INCOME TAXES
ACCOUNT 408
INSTRUCTIONS: Provide an analysis of Account 408, "Taxes Other Than Income
Taxes". Separate the analysis into two groups: (1) other than
U.S. Government taxes, and (2) U.S. Government taxes. Specify
each of the various kinds of taxes and show the amounts thereof.
Provide a subtotal for each class of tax.
K I N D O F T A X AMOUNT
(In Thousands)
[S] [C]
1. Taxes Other Than U.S. Government Taxes
New York State Franchise $ 2
State Unemployment 306
Ohio Corporation Franchise 1,596
Ohio Real Estate Assessment 1,499
Ohio Intercounty Return of Taxable
Business Property 420
Miscellaneous Taxes 257
Sub-Total Taxes Other Than U.S. Government Taxes 4,080
2. U.S. Government Taxes
Social Security 16,804
Federal Unemployment 230
Sub-Total U.S. Government Taxes 17,034
TOTAL $21,114
<PAGE>
<TABLE>
33
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
<CAPTION>
DONATIONS
ACCOUNT 426.1
INSTRUCTIONS: Provide a listing of the amount included in Account 426.1,
"Donations", classifying such expenses by its purpose. The
aggregate number and amount of all items of less than $3,000
may be shown in lieu of details.
NAME OF RECIPIENT PURPOSE OF DONATION AMOUNT
(In Thousands)
<S> <C> <C>
Action for Children Community $ 5
American Society of Mechanical Technology Educational 25
Arthritis Foundation Community 4
Averett College Educational 4
Ballet Metropolitan Community 7
Blackstone Group Community 5
Brookings Institution Community 10
Center for Study of American Business Cummunity 15
Center in the Square Endowment Fund Community 20
Center of Science & Industry Community 200
Children's Hospital Foundation Community 28
Columbus Association for the
Performing Arts Community 15
Columbus Museum of Art Community 7
Columbus Opera Community 9
Columbus Speech & Hearing Center Community 4
Columbus Symphony Orchestra Community 15
Columbus Zoo Community 10
Decorative Arts Center Community 5
Dinamo Community 15
Franklin University Educational 4
Grandview Heights High School Educational 10
M. L. King Arts Complex Community 4
I Know I Can Educational 5
Lancaster Festival Inc. Community 4
Lancaster, Fairfield Community 5
Leukemia Society of America Community 6
National Academy of Engineering Educational 5
National Chamber Litigation Community 5
National Coal Council Community 11
National First Ladies Library Community 10
National Governors Association Community 12
Nature Conservancy Community 25
Notre Dame Educational 4
Ohio Academy of Science Educational 4
Ohio Chamber of Commerce Community 40
Ohio Dominican College Educational 21
Ohio Foundation of Independent
Colleges, Inc. Educational 27
Ohio River Valley Water
Sanitation Commission Community 15
The Ohio State University Educational 84
Olivedale Senior Citizens of Fairfield
County, Inc. Community 5
Resources for the Future Community 20
SUB-TOTAL 729
(Cont'd)
<PAGE>
<PAGE>
33A
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
DONATIONS
ACCOUNT 426.1
INSTRUCTIONS: Provide a listing of the amount included in Account 426.1,
"Donations", classifying such expenses by its purpose. The
aggregate number and amount of all items of less than $3,000
may be shown in lieu of details.
NAME OF RECIPIENT PURPOSE OF DONATION AMOUNT
(In Thousands)
Sub-Total Brought Forward 729
Science & Mathematics Network Educational 5
Seal of Ohio Girl Scout Council Community 13
Simon Kenton Council Community 57
Star Foundation, Inc. Community 5
United Negro College Fund Educational 8
United Way Community 318
Utility Business Education Coalition Educational 5
Virginia Polytechnic Institute Educational 12
Virginia Tech Foundation, Inc. Matching Contribution 13
YWCA Capital Campaign Community 16
YMCA Community 12
Employees and Others (Salaries, salary related
expenses, overheads and other expenses) Community 103
Miscellaneous - 309 items of less
than $3,000 Various 191
TOTAL $1,487 <PAGE>
<PAGE>
34
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
OTHER DEDUCTIONS
ACCOUNT 426.5
INSTRUCTIONS: Provide a listing of the amount included in Account 426.5,
"Other Deductions", classifying such expenses according to
their nature.
D E S C R I P T I O N NAME OF PAYEE AMOUNT
(In Thousands)
Cash Contributions: Center for Energy and Economical
Development $ 2
Every Child Counts - State Issue 2 100
Lancaster Chamber of Commerce 1
March of Dimes 1
Michael Bowers 1
National Energy Resources 1
Ohio Chamber of Commerce 6
Ohio State University 164
Repeal PUHCA Now Coalition 75
Roanoke Regional Chamber of Commerce 1
Service Fees and Other: Accord Group 24
The Capitol Connection 1
Columbus Museum of Art 3
Eagle Exhibit Services Inc. 2
Gary C. Barbour 59
Lester F. Wright 30
The Success Group, Inc. 61
Appalachian Power Company 1
Salaries, salary related
expenses, overheads, and
other expenses Employees and Others 1,347
TOTAL $1,880
<PAGE>
<PAGE> 34A
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1993
OTHER DEDUCTIONS
ACCOUNT 426.5
INSTRUCTIONS: Provide a listing of the amount included in Account 426.5,
"Other Deductions", classifying such expenses according to
their nature.
D E S C R I P T I O N NAME OF PAYEE AMOUNT
(In Thousands)
Sub-Total Brought Forward
TOTAL $ <PAGE>
</TABLE>
<PAGE> 35
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XVIII
NOTES TO STATEMENT OF INCOME
INSTRUCTIONS: The space below is provided for important notes
regarding the statement of income or any account
thereof. Furnish particulars as to any significant
increase in services rendered or expenses incurred
during the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
See Notes to Financial Statements on Page 19.<PAGE>
<PAGE>
36
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
ORGANIZATION CHART
Chairman, Chief Executive Officer & President
Corporate Development
Energy Services & Power Marketing
Legal
Nuclear Generation
EVP - Corporate Services
Corporate Services
Human Resources
Information Technology
Procurement and Supply Chain Services
EVP - Financial Services
Corporate Accounting
Corporate Planning & Budgeting
Finance
Internal Audits (NOTE)
Tax
EVP - Energy Delivery and Customer Relations
Consumer Services
Corporate Communications
Energy Pricing & Regulatory Services
System Planning
EVP - Energy Delivery
Energy Delivery Support
Energy Distribution
Energy Transmission
EVP - Power Generation
Environmental Services
Fossil and Hydro Production
Northern RSO Production
Northern RSO Support
Southern RSO Production
Southern RSO Support
Fuel Supply
Power Generation Engineering
NOTE: Internal Audits reports to the Audit Committee
of the Board of Directors of American Electric
Power Company, Inc. and administratively to the
Executive Vice President - Financial Services <PAGE>
<PAGE>
37
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
METHODS OF ALLOCATION
Service Billings
Kilowatt Hours Sales (KWH) Ratio
Client Load Ratio
Number of Electric Customers Ratio
Number of Client Employees Ratio
Plant Investment Ratio
Level of Construction Ratio
Level of Construction - Production Ratio
Level of Construction - Transmission Ratio
Level of Construction - Distribution Ratio
Tons of Coal Acquired Ratio
Coal Company Combination Ratio
Coal-Fired Kilowatt Hours Generation Ratio
Transmission and Sub-Transmission Pole Miles Ratio
Plant Megawatt Capability Ratio
Number of Stores Transactions Ratio
Data Processing Staff Job Hours Ratio
Fossil Plant Combination Ratio
Number of Invoices Processed Ratio
Total Annual Cost Ratio
Specific Identification Ratio
(based on known and pertinent factors)
Equal Share Ratio
Hydro Kilowatt Hours Generation Ratio
Number of Purchase Orders Written Ratio
Convenience Billings
Specific Identification Ratio
(based on known and pertinent factors)
Asset Ratio
Expense Budget Ratio
Contribution Ratio
Equal Share Ratio
Gross Annual Payroll Dollars Ratio
Coal Production Ratio
Kilowatt Hours Sales (KWH) Ratio
Number of Employees Ratio
Number of Customers Ratio
Number of Vehicles Ratio<PAGE>
<PAGE>
38
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
ANNUAL STATEMENT OF COMPENSATION FOR USE OF CAPITAL BILLED
April 27, 1999
Statement of the Amount of Interest on Borrowed
Capital and Compensation for the Use of Capital
Billed by American Electric Power Service Corporation
(AEPSC) for the Year Ended December 31, 1998
G. R. Knorr - Columbus
AEP System Accounting Managers and Corporate Planning and Budgeting
In accordance with Instruction 01-12 of the Uniform System of Accounts
prescribed by the Securities and Exchange Commission for Mutual Service
Companies and Subsidiary Service Companies under the Public Utility
Holding Company Act of 1935, as amended, this is an annual statement of
the amount of interest on borrowed capital and compensation for the use
of capital billed by AEPSC for the year ended December 31, 1998.
Exhibit A, attached hereto, shows your portion of the interest cost on
capital borrowed for working capital requirements. The method used to
allocate the cost to each System company was the Total Annual Cost Ratio
based on the total direct and indirect charges billed during the prior
year of 1997. The amount shown for each company equals the total charges
billed under Work Order No. 1200 during 1998.
In addition to the interest charges incurred for working capital, AEPSC
billed to all clients, as an indirect cost applicable to administrative
services, a total amount of $6,398,790.00 of interest cost and debt
expenses related to the mortgage notes on its headquarters building
located in Columbus, Ohio.
All interest charges incurred by AEPSC during 1998 were for borrowings
with unaffiliated companies. No amount was billed by AEPSC during 1998
as compensation for the use of equity capital, all of which is furnished
to AEPSC by its parent, American Electric Power Company, Inc.
G. R. Knorr
GRK rp
Attachment
cc: H. W. Fayne
A. A. Pena
L. V. Assante
I:\RP\U1360\LETTER.WP
Note: The above annual statement was provided to each associate
company within the AEP system. Please refer to the
"Analysis of Billing - Associate Companies" appearing on
page 21 of this report for a listing of the associated
companies billed and the respective amounts (Account
457-3).
<PAGE>
<PAGE>
39
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SIGNATURE CLAUSE
Pursuant to the requirements of the Public Utility Holding Company
Act of 1935 and the rules and regulations of the Securities and
Exchange Commission issued thereunder, the undersigned company has
duly caused this report to be signed on its behalf by the under-
signed officer thereunto duly authorized.
American Electric Power Service Corporation
(Name of Reporting Company)
By: /s/ Gerald R. Knorr
(Signature of Signing Officer)
Gerald R. Knorr - Assistant Controller
(Printed Name and Title of Signing Officer)
Date: 4/30/99
<PAGE>
<PAGE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1998
SCHEDULE XIX - FINANCIAL DATA SCHEDULE
If, at the time an annual report on this form is filed, the registrant is
required to submit this report and any amendments thereto electronically via
EDGAR, the registrant shall furnish a Financial Data Schedule. The Schedule
shall set forth the financial and other data specified below that are
applicable to the registrant on a consolidated basis.
ITEM NO. CAPTION HEADING AMOUNT
(In Thousands)
1 Net Service Company Property $156,699
2 Total Investments 87,669
3 Total Current and Accrued Assets 118,496
4 Total Deferred Debits 68,913
5 Balancing Amount For Total Assets and Other Debits -0-
6 Total Assets and Other Debits 431,777
7 Total Proprietary Capital 1,350
8 Total Long-Term Debt 66,100
9 Notes Payable 40,111
10 Notes Payable to Associate Companies -0-
11 Balancing Amount For Other Noncurrent Liabilities
and Total Current and Accrued Liabilities 279,761
12 Total Deferred Credits 13,199
13 Accumulated Deferred Income Taxes 31,256
14 Total Liabilities and Proprietary Capital 431,777
15 Services Rendered to Associate Companies 564,888
16 Services Rendered to Nonassociate Companies 912
17 Miscellaneous Income or Loss 342
18 Total Income 566,142
19 Salaries and Wages 297,039
20 Employee Pensions and Benefits 49,225
21 Balancing Amount For Total Expenses 219,878
22 Total Expenses 566,142
23 Net Income (Loss) -0-
24 Total Expenses (Direct Costs) 505,587
25 Total Expenses (Indirect Costs) 60,555
26 Total Expenses (Total) 566,142
27 Number of Personnel End of Year 3,459
<TABLE> <S> <C>
<ARTICLE> OPUR2
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<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> DEC-31-1998
<BOOK-VALUE> PER-BOOK
<NET-SERVICE-COMPANY-PROPERTY> 156,699
<TOTAL-INVESTMENTS> 87,669
<TOTAL-CURRENT-ASSETS> 118,496
<TOTAL-DEFERRED-DEBITS> 37,662
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<TOTAL-ASSETS-AND-DEBITS> 400,526
<TOTAL-PROPRIETARY-CAPITAL> 1,350
<TOTAL-LONG-TERM-DEBT> 66,100
<NOTES-PAYABLE> 28,825
<NOTES-PAYABLE-ASSOCIATE-COMP> 0
<OTHER-CURR-AND-ACCRUED-LIAB> 159,801
<TOTAL-DEFERRED-CREDITS> 5,913
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<TOT-EXP-DIRECT-AND-INDIRECT> 566,142
<PERSONNEL-END-OF-YEAR> 4,400
