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Form U-13-60
Mutual and Subsidiary Service Companies
Revised February 7, 1980
ANNUAL REPORT
FOR THE PERIOD
Beginning January 1, 1996 and Ending December 31, 1996
TO THE
U.S. SECURITIES AND EXCHANGE COMMISSION
OF
GPU SERVICE, INC.
(Exact Name of Reporting Company)
A Subsidiary Service Company
("Mutual" or "Subsidiary")
Date of Incorporation April 30, 1970
If not Incorporated, Date of Organization
State or Sovereign Power under which Incorporated or Organized Pennsylvania
Location of Principal Executive Offices of Reporting Company:
100 Interpace Parkway, Parsippany, NJ 07054
Name, title, and address of officer to whom correspondence concerning this
report should be addressed:
100 Interpace Parkway
P. R. Chatman Assistant Comptroller Parsippany, NJ 07054
(Name) (Title) (Address)
Name of Principal Holding Company Whose Subsidiaries are served by Reporting
Company:
GPU, INC.
<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 Instructions for
that form.
2. Number of Copies.--Each annual report shall be filed in duplicate.
The company should prepare and retain at least one extra copy for itself in
case correspondence with reference to the report become 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. Subsequent reports should cover a calendar year.
4. Report Format.--Reports shall be submitted on the forms prepared 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 requesting 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 Subsidiary 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.
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>
2
LISTING OF SCHEDULES AND ANALYSIS OF ACCOUNTS Page
Number
Description of Schedules and Accounts Schedule 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 24-25A
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>
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 38
OF CAPITAL BILLED
VENTURE DISCLOSURES 39
FINANCIAL DATA SCHEDULE - FILED VIA EDGAR
NOTE: Dollar figures in this report are shown in thousands unless
otherwise noted.
<PAGE>
4
ANNUAL REPORT OF GPU SERVICE, INC.
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
SERVICE COMPANY PROPERTY
101 Service Company property (Schedule II) $ 85,346 $81,211
107 Construction work in progress (Schedule II) - -
Total Property 85,346 81,211
108 Less accumulated provision for depreciation
and amortization of service company
property (Schedule III) 28,455 24,434
Net Service Company Property 56,891 56,777
INVESTMENTS
123 Investments in associate companies (Schedule IV) - -
124 Other investments (Schedule IV) 17,568 10,668
Total Investments 17,568 10,668
CURRENT AND ACCRUED ASSETS
131 Cash 9 32
134 Special deposits 79 92
135 Working funds - -
136 Temporary cash investments (Schedule IV) - -
141 Notes receivable - -
143 Accounts receivable 17,795 2,235
144 Accumulated provision for uncollectible accounts - -
146 Accounts receivable from associate
companies (Schedule V) 8,219 5,366
152 Fuel stock expenses undistributed (Schedule VI) - -
154 Materials and supplies - -
163 Stores expense undistributed (Schedule VII) - -
165 Prepayments 894 335
171 Interest Receivable - -
174 Miscellaneous current and accrued
assets (Schedule VIII) - -
Total Current and Accrued Assets 26,996 8,060
DEFERRED DEBITS
181 Unamortized debt expense 42 46
184 Clearing accounts - 132
186 Miscellaneous deferred debits (Schedule IX) 1,949 2,788
188 Research, development, or demonstration
expenditures (Schedule X) - -
190 Accumulated deferred income taxes 10,504 12,796
Total Deferred Debits 12,495 15,762
TOTAL ASSETS AND OTHER DEBITS $113,950 $91,267
<PAGE>
5
ANNUAL REPORT OF GPU SERVICE, INC.
SCHEDULE I - COMPARATIVE BALANCE SHEET
ACCOUNT LIABILITIES AND PROPRIETARY CAPITAL As of December 31
CURRENT PRIOR
PROPRIETARY CAPITAL
201 Common stock issued (Schedule XI) $ 50 $ 50
211 Miscellaneous paid-in-capital (Schedule XI) - -
215 Appropriated retained earnings (Schedule XI) (1,856) (768)
216 Unappropriated retained earnings (Schedule XI) - -
Total Proprietary Capital (1,806) (718)
LONG-TERM DEBT
223 Advances from associate companies (Schedule XII) - -
224 Other long-term debt (Schedule XII) 36,181 33,685
225 Unamortized premium on long-term debt - -
226 Unamortized discount on long-term debt-debit - -
Total Long-term Debt 36,181 33,685
CURRENT AND ACCRUED LIABILITIES
231 Notes payable - -
232 Accounts payable 23,523 11,233
233 Notes payable to associate
companies (Schedule XIII) - -
234 Accounts payable to associate
companies (Schedule XIII) 11,642 -
236 Taxes accrued 593 2,824
237 Interest accrued 418 659
238 Dividends declared - -
241 Tax collections payable 57 729
242 Miscellaneous current and accrued
liabilities (Schedule XIII) 24,537 24,801
Total Current and Accrued Liabilities 60,770 40,246
DEFERRED CREDITS
253 Other deferred credits 10,184 9,613
255 Accumulated deferred investment tax credits - -
Total Deferred Credits 10,184 9,613
282 ACCUMULATED DEFERRED INCOME TAXES 8,621 8,441
TOTAL LIABILITIES AND PROPRIETARY
CAPITAL $113,950 $91,267
<PAGE>
6
<TABLE>
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
SCHEDULE II - SERVICE COMPANY PROPERTY
<CAPTION>
BALANCE AT RETIREMENTS OTHER BALANCE AT
BEGINNING ADDITIONS OR CHANGES 1/ CLOSE OF
DESCRIPTION OF YEAR SALES YEAR
SERVICE COMPANY PROPERTY
Account
<S> <C> <C> <C> <C> <C>
301 ORGANIZATION $ 49 $ - $ - $ - $ 49
303 MISCELLANEOUS
INTANGIBLE PLANT
304 LAND AND LAND RIGHT 2,824 - - - 2,824
305 STRUCTURES AND
IMPROVEMENTS 50,497 684 - - 51,181
306 LEASEHOLD
IMPROVEMENTS - - - - -
307 EQUIPMENT 2/ 20,952 5,748 2,864 - 23,836
308 OFFICE FURNITURE
AND EQUIPMENT 4,894 76 - - 4,970
309 AUTOMOBILES, OTHER
VEHICLES AND
RELATED GARAGE
EQUIPMENT
310 AIRCRAFT AND
AIRPORT EQUIPMENT
311 OTHER SERVICE
COMPANY PROPERTY 3/ 1,995 491 - - 2,486
SUB-TOTAL 81,211 6,999 2,864 - 85,346
107 CONSTRUCTION WORK
IN PROGRESS 4/ - - - - -
TOTAL $81,211 $ 6,999 $ 2,864 $ - $85,346
1/ PROVIDE AN EXPLANATION OF THOSE CHANGES CONSIDERED MATERIAL:
N/A
<PAGE>
7
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:
<CAPTION>
BALANCE AT
SUBACCOUNT DESCRIPTION ADDITIONS CLOSE OF
YEAR
<S> <C> <C>
COMMUNICATIONS EQUIPMENT (MICROWAVE & TELEPHONE) $ 77 $ 1,915
DATA PROCESSING EQUIPMENT 4,283 17,439
DISPATCHING EQUIPMENT 688 990
LOAD RESEARCH EQUIPMENT - 119
MISCELLANEOUS EQUIPMENT 26 318
PERSONAL COMPUTER 674 3,055
TOTAL $ 5,748 $23,836
3/ DESCRIBE OTHER SERVICE COMPANY PROPERTY:
Photographic, Cafeteria Furniture & Equipment, Mailing Equipment
4/ DESCRIBE CONSTRUCTION WORK IN PROGRESS:
N/A
<PAGE>
8
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
SCHEDULE III
ACCUMULATED PROVISION FOR DEPRECIATION AND
AMORTIZATION OF SERVICE COMPANY PROPERTY
<CAPTION>
BALANCE AT ADDITIONS BALANCE AT
BEGINNING CHARGED OTHER CHANGES CLOSE OF
DESCRIPTION OF YEAR TO RETIREMENTS ADD (DEDUCT)1/ YEAR
ACCOUNT 403
Account
<S> <C> <C> <C> <C> <C>
301 ORGANIZATION
303 MISCELLANEOUS
INTANGIBLE PLANT
304 LAND AND LAND RIGHTS
305 STRUCTURES AND
IMPROVEMENTS $14,703 $1,273 $ - $ - $15,976
306 LEASEHOLD
IMPROVEMENTS - - - - -
307 EQUIPMENT 6,344 2,174 - - 8,518
308 OFFICE FURNITURE
AND FIXTURES 2,709 493 - - 3,202
309 AUTOMOBILES, OTHER
VEHICLES AND
RELATED GARAGE
EQUIPMENT
310 AIRCRAFT AND
AIRPORT EQUIPMENT
311 OTHER SERVICE
COMPANY PROPERTY 678 81 - - 759
$24,434 $4,021 $ - $ - $28,455
1/ PROVIDE AN EXPLANATION OF THOSE CHANGES CONSIDERED MATERIAL:
N/A
</TABLE>
<PAGE>
9
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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
OF YEAR YEAR
ACCOUNT 123 - INVESTMENT IN ASSOCIATE COMPANIES
NONE
ACCOUNT 124 - OTHER INVESTMENTS
COMPANY OWNED LIFE INSURANCE -
CASH SURRENDER VALUE $ 8,761 $ 9,601
RABBI TRUST 1,907 7,801
HEALTH CARE RESERVE - 166
ACCOUNT 136 - TEMPORARY CASH INVESTMENTS
NONE
TOTAL $10,668 $17,568
<PAGE>
10
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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
OF YEAR YEAR
ACCOUNT 146 - ACCOUNTS RECEIVABLE FROM ASSOCIATE
COMPANIES
GPU INTERNATIONAL, INC. $ 289 $ 232
GPU POWER, INC. - 58
GPU ELECTRIC, INC. - 48
GPU, INC. 423 436
GPU GENERATION, INC. - 5,745
GPU NUCLEAR, INC. 736 19
JERSEY CENTRAL POWER & LIGHT COMPANY 1,470 -
METROPOLITAN EDISON COMPANY 1,305 1,333
PENNSYLVANIA ELECTRIC COMPANY 1,143 348
TOTAL $ 5,366 $ 8,219
ANALYSIS OF CONVENIENCE OR ACCOMMODATION PAYMENTS: TOTAL
PAYMENTS
INTERCHANGE TRANSACTIONS
JERSEY CENTRAL POWER & LIGHT COMPANY $53,137
METROPOLITAN EDISON COMPANY 34,779
PENNSYLVANIA ELECTRIC COMPANY 2,011
TOTAL PAYMENTS $89,927
<PAGE>
11
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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.
D E S C R I P T I O N LABOR EXPENSES TOTAL
ACCOUNT 152 - FUEL STOCK EXPENSES UNDISTRIBUTED
NONE
TOTAL - - -
SUMMARY:
<PAGE>
12
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
SCHEDULE VII - STORES EXPENSE UNDISTRIBUTED
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
ACCOUNT 163 - STORES EXPENSE UNDISTRIBUTED $1,770 $448 $2,218
BILLED TO:
JERSEY CENTRAL POWER & LIGHT COMPANY (524) (125) (649)
METROPOLITAN EDISON COMPANY (716) (125) (841)
PENNSYLVANIA ELECTRIC COMPANY (403) (129) (532)
GPU NUCLEAR, INC. (10) - (10)
GPU GENERATION, INC. (117) (69) (186)
NOTE: Stores expenses are billed back to the associated companies in
the month incurred.
TOTAL $ - $ - $ -
<PAGE>
13
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
SCHEDULE VIII
MISCELLANEOUS CURRENT AND ACCRUED ASSETS
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
OF YEAR YEAR
ACCOUNT 174 - MISCELLANEOUS CURRENT AND ACCRUED
ASSETS
NONE
TOTAL - -
<PAGE>
14
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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
OF YEAR YEAR
ACCOUNT 186 - MISCELLANEOUS DEFERRED DEBITS
Air Shuttle $ 152 $ 138
Stock Plan 1,904 1,855
Procurement Cards 35 17
Unclassified Charges by Associates 513 73
Fringe Benefits - (33)
Misc. Billing Adjustments 184 (101)
TOTAL $2,788 $1,949
<PAGE>
15
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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
ACCOUNT 188 - RESEARCH, DEVELOPMENT, OR DEMONSTRATION
EXPENDITURES
SYSTEM RESEARCH AND DEVELOPMENT $ 22
BILLED TO:
JERSEY CENTRAL POWER & LIGHT COMPANY (11)
PENNSYLVANIA ELECTRIC COMPANY (6)
METROPOLITAN EDISON COMPANY (5)
NOTE: Research and development expenses
are billed back to the associate
companies in the month incurred.
TOTAL $ -
<PAGE>
<TABLE>
16
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
SCHEDULE XI - PROPRIETARY CAPITAL
<CAPTION>
NUMBER OF PAR OR STATED
ACCOUNT NUMBER CLASS OF STOCK SHARES VALUE OUTSTANDING CLOSE OF PERIOD
AUTHORIZED PER SHARE NO. OF SHARES TOTAL AMOUNT
<S> <C> <C> <C> <C> <C>
201 COMMON STOCK ISSUED 5,000 $10 * 5,000 $50,000*
INSTRUCTIONS: Classify amounts in each account with brief explanation, disclosing the general nature of
transactions which gave rise to the reported amounts.
<CAPTION>
D E S C R I P T I O N AMOUNT
<S> <C>
ACCOUNT 211 - MISCELLANEOUS PAID-IN CAPITAL NONE
ACCOUNT 215 - APPROPRIATED RETAINED EARNINGS $(1,856)
GPUS Excess Pension Plan Minimum Liability Recognition
TOTAL $(1,856)
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.
<CAPTION>
BALANCE AT NET INCOME BALANCE AT
D E S C R I P T I O N BEGINNING OR DIVIDENDS CLOSE OF
OF YEAR (LOSS) PAID YEAR
<S> <C> <C> <C> <C> <C>
ACCOUNT 216 - UNAPPROPRIATED RETAINED EARNINGS
NONE
TOTAL $ - $ - $ - $ -
* In whole dollars.
<PAGE>
17
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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.
<CAPTION>
TERMS OF OBLIG DATE BALANCE AT BALANCE AT
NAME OF CREDITOR CLASS & SERIES OF INTEREST AMOUNT BEGINNING 1/ CLOSE
OF OBLIGATION MATURITY RATE AUTHORIZED OF YEAR ADDITIONS DEDUCTIONS OF YEAR
<S> <C> <C> <C> <C> <C>
ACCOUNT 223 - ADVANCES FROM ASSOCIATE
COMPANIES:
NONE
ACCOUNT 224 - OTHER LONG-TERM DEBT:
Aetna Insurance 4/1/01 10.87 $ 19,200 $19,200 $ -
First Union Bank (formerly First Fidelity) 9/30/98 Variable 11,500 11,500 -
First National Bank of Chicago 4/1/01 Variable - $ 35,000 35,000
Obligations under Capital Leases Various Various 2,985 1,804 1,181
Total $ 33,685 $ 35,000 $32,504 $36,181
1/ GIVE AN EXPLANATION OF DEDUCTIONS: Aetna Insurance and First Union Bank (formerly First Fidelity)-Refinanced with a $35
million five year term loan agreement with First National Bank of Chicago. Obligations under Capital Leases-Payments per
Agreements.
</TABLE>
<PAGE>
18
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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
OF YEAR YEAR
ACCOUNT 233 - NOTES PAYABLE TO ASSOCIATE COMPANIES
NONE
TOTAL - -
ACCOUNT 234 - ACCOUNTS PAYABLE TO ASSOCIATE
COMPANIES
JERSEY CENTRAL POWER & LIGHT COMPANY $ - $11,642
TOTAL $ - $11,642
ACCOUNT 242 - MISCELLANEOUS CURRENT AND ACCRUED
LIABILITIES
ACCRUALS
- DENTAL $ 120 $ 349
- CAFETERIA SUPPLEMENT 18 18
- INTERCHANGE POWER (71) (71)
- INCENTIVE COMPENSATION 6,166 6,004
- HOSPITALIZATION 1,761 2,317
- LEGAL 228 -
- OFFICERS' DEFERRED COMPENSATION 4,901 6,050
- PENSION COSTS 2,543 2,322
- SEVERANCE PAY - 423
- WORKMEN'S COMPENSATION - 14
- VACATION 6,250 5,289
- OBLIGATIONS UNDER CAPITAL LEASES 2,885 1,822
(Short-Term Portion)
TOTAL $24,801 $24,537
<PAGE>
19
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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.
NONE
<PAGE>
20
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
SCHEDULE XV
STATEMENT OF INCOME
ACCOUNT D E S C R I P T I O N CURRENT YEAR PRIOR YEAR
INCOME
457 Services rendered to associate companies $134,156 $128,143
458 Services rendered to nonassociate
companies 172 390
421 Miscellaneous income or loss 16 8
Total Income 134,344 128,541
EXPENSE
920 Salaries and wages 61,335 59,293
921 Office supplies and expenses 12,891 11,025
922 Administrative expense transferred -
credit - -
923 Outside services employed 6,702 8,471
924 Property insurance 171 53
925 Injuries and damages 320 142
926 Employee pensions and benefits 26,823 18,609
928 Regulatory commission expense - -
930.1 General advertising expenses 37 1
930.2 Miscellaneous general expenses 531 3,729
931 Rents 8,310 10,241
932 Maintenance of structures and equipment 4,410 3,505
403 Depreciation and amortization expense 4,021 3,415
408 Taxes other than income taxes 6,363 5,955
409 Income taxes (4,227) (1,887)
410 Provision for deferred income taxes 10,941 9,851
411 Provision for deferred income taxes -
credit (7,533) (7,246)
411.5 Investment tax credit - -
426.1 Donations 230 120
426.5 Other deductions (406) (210)
427 Interest on long-term debt 2,807 2,947
430 Interest on debt to associate
companies - -
431 Other interest expense 618 527
Total Expense 134,344 128,541
Net Income or (Loss) $ - $ -
<PAGE>
21
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
ANALYSIS OF BILLING
ASSOCIATE COMPANIES
ACCOUNT 457
DIRECT INDIRECT COMPENSATION TOTAL
COSTS COSTS FOR USE AMOUNT
NAME OF ASSOCIATE COMPANY CHARGED CHARGED OF CAPITAL BILLED
457-1 457-2 457-3
GPU, INC. $ 1,672 $ 305 $ - $ 1,977
JERSEY CENTRAL POWER
& LIGHT COMPANY 35,901 8,105 - 44,006
PENNSYLVANIA ELECTRIC
COMPANY 25,009 5,850 - 30,859
METROPOLITAN EDISON
COMPANY 23,718 5,696 - 29,414
GPU NUCLEAR, INC. 13,418 4,340 - 17,758
GPU INTERNATIONAL, INC. 568 123 - 691
GPU POWER, INC. 122 25 - 147
GPU ELECTRIC, INC. 182 36 - 218
GPU GENERATION, INC. 7,582 1,504 - 9,086
TOTAL $108,172 $25,984 $ - $134,156
<PAGE>
<TABLE>
22
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
ANALYSIS OF BILLING
NONASSOCIATE COMPANIES
ACCOUNT 458
<CAPTION>
DIRECT INDIRECT COMPENSATION EXCESS
COSTS COSTS FOR USE TOTAL OR TOTAL
NAME OF NONASSOCIATE COMPANY CHARGED CHARGED OF CAPITAL COST DEFICIENCY AMOUNT
458-1 458-2 458-3 458-4 BILLED
<S> <C> <C> <C> <C> <C> <C>
* Consumers Water Companies (A) $ 10 $ 2 $ 12 $ 27 $ 39
New York State Electric & Gas (B) 6 6 6
PJM Interconnection Office (C) 8 8 8
Utilities Employees Credit Union (D) 34 85 119 119
TOTAL $ 58 $ 87 $ - $145 $ 27 $172
INSTRUCTION: Provide a brief description of the services rendered to each nonassociated company:
(A) Billing Services
(B) Tie Line Services
(C) Computer Terminal Replacement & Communication Backup Service
(D) Computer Services
* See Descriptions of Activities on page 39.
<PAGE>
23
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
SCHEDULE XVI
ANALYSIS OF CHARGES FOR SERVICE
ASSOCIATE AND NONASSOCIATE COMPANIES
<CAPTION>
ASSOCIATE COMPANY CHARGES NONASSOCIATE COMPANY CHARGES TOTAL CHARGES FOR SERVICE
DIRECT INDIRECT DIRECT INDIRECT DIRECT INDIRECT
DESCRIPTION OF ITEMS COST COST TOTAL COST COST TOTAL COST COST TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
920 SALARIES AND WAGES $ 53,494 $ 7,840 $ 61,334 $ 1 $ $ 1 $ 53,495 $ 7,840 $ 61,335
921 OFFICE SUPPLIES AND EXPENSES 7,964 4,890 12,854 22 15 37 7,986 4,905 12,891
922 ADMINISTRATIVE EXPENSE TRANSFERRED-
CREDIT
923 OUTSIDE SERVICES EMPLOYED 6,721 (19) 6,702 6,721 (19) 6,702
924 PROPERTY INSURANCE 4 167 171 4 167 171
925 INJURIES AND DAMAGES 262 58 320 262 58 320
926 EMPLOYEE PENSIONS AND BENEFITS 24,959 1,864 26,823 24,959 1,864 26,823
928 REGULATORY COMMISSION EXPENSE
930.1 GENERAL ADVERTISING EXPENSES 13 24 37 13 24 37
930.2 MISC. GENERAL EXPENSES 437 88 525 6 6 443 88 531
931 RENTS 6,627 1,634 8,261 14 35 49 6,641 1,669 8,310
932 MAINTENANCE OF STRUCTURES AND
EQUIPMENT 2,900 1,458 4,358 15 37 52 2,915 1,495 4,410
403 DEPRECIATION AND AMORTIZATION
EXPENSE 152 3,869 4,021 152 3,869 4,021
408 TAXES OTHER THAN INCOME TAXES 4,840 1,523 6,363 4,840 1,523 6,363
409 INCOME TAXES (95) (4,132) (4,227) (95) (4,132) (4,227)
410 PROVISION FOR DEFERRED INCOME TAXES 10,941 10,941 10,941 10,941
411 PROVISION FOR DEFERRED INCOME TAXES
- CREDIT (7,533) (7,533) (7,533) (7,533)
411.5 INVESTMENT TAX CREDIT
426.1 DONATIONS 230 230 230 230
426.5 OTHER DEDUCTIONS (406) (406) (406) (406)
427 INTEREST ON LONG-TERM DEBT 80 2,727 2,807 80 2,727 2,807
431 OTHER INTEREST EXPENSE 23 595 618 23 595 618
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 = 108,205 25,994 134,199 58 87 145 108,263 26,081 134,344
COMPENSATION FOR USE OF EQUITY CAPITAL =
430 INTEREST ON DEBT TO ASSOC. COMPANIES =
TOTAL COST OF SERVICE = $108,205 $25,994 $134,199 $ 58 $87 $145 $108,263 $26,081 $134,344
<PAGE>
24
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
<CAPTION>
D E P A R T M E N T OR S E R V I C E F U N C T I O N
TOTAL BUSINESS CORPORATE HUMAN
D E S C R I P T I O N O F I T E M S AMOUNT OVERHEAD ACCOUNTING TAXES PLANNING SECRETARY LEGAL RESOURCES
<S> <C> <C> <C> <C> <C> <C> <C> <C>
920 SALARIES AND WAGES $ 61,335 $ 7,840 $6,106 $ 898 $ 834 $466 $ 837 $2,278
921 OFFICE SUPPLIES AND EXPENSES 12,891 4,905 1,330 68 66 78 63 363
922 ADMINISTRATIVE EXPENSE TRANSFERRED -
CREDIT
923 OUTSIDE SERVICES EMPLOYED 6,702 (19) 153 4 91 2 1,757 1,040
924 PROPERTY INSURANCE 171 167
925 INJURIES AND DAMAGES 320 58 30 4 3 2 5 11
926 EMPLOYEE PENSIONS AND BENEFITS 26,823 1,864 1,516 213 206 106 230 533
928 REGULATORY COMMISSION EXPENSE
930.1 GENERAL ADVERTISING EXPENSE 37 24 1
930.2 MISCELLANEOUS GENERAL EXPENSES 531 88 2 6 1 55
931 RENTS 8,310 1,669 484 344 28 11 15 26
932 MAINTENANCE OF STRUCTURES AND
EQUIPMENT 4,410 1,495 37 1 8 3 8 60
403 DEPRECIATION AND AMORTIZATION
EXPENSE 4,021 3,869
408 TAXES OTHER THAN INCOME TAXES 6,363 1,523 459 64 62 32 70 161
409 INCOME TAXES (4,227) (4,132)
410 PROVISION FOR DEFERRED INCOME TAXES 10,941 10,941
411 PROVISION FOR DEFERRED INCOME TAXES
- CREDIT (7,533) (7,533)
411.5 INVESTMENT TAX CREDIT
426.1 DONATIONS 230
426.5 OTHER DEDUCTIONS (406)
427 INTEREST ON LONG-TERM DEBT 2,807 2,727
430 INTEREST ON DEBT TO ASSOCIATE
COMPANIES
431 OTHER INTEREST EXPENSE 618 595
INSTRUCTION: Indicate each department or
service function. (See Instruc-
tion 01-3 General Structure of
Accounting System: Uniform
System Account)
TOTAL EXPENSES= $134,344 $26,081 $10,118 $1,596 $1,304 $700 $2,986 $4,527
<PAGE>
25
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
<CAPTION>
D E P A R T M E N T OR S E R V I C E F U N C T I O N
MATERIAL
ACCOUNT & INTERNAL INFORMATION POWER SYSTEM TRANSMISSION
NUMBER SERVICE EXECUTIVE AUDIT SERVICES SUPPLY GENERATION OPERATIONS PLAN & ANAL.
<S> <C> <C> <C> <C> <C> <C> <C> <C>
920 $ 735 $2,655 $ 2,656 $19,922 $ 725 $ $3,542 $
921 273 603 246 2,994 76 1 138
922
923 338 33 74 2,000 61 2 26
924 4
925 4 7 13 110 3 14
926 183 343 682 5,452 156 681
928
930.1 2 1
930.2 9 21 52 37
931 45 4 20 4,776 14 9 224 11
932 4 14 11 2,215 2 100
403 89
408 55 104 206 2,544 47 206
409 (95)
410
411
411.5
426.1 50 3
426.5 1
427 80
430
431 23
TOTAL $1,646 $3,836 $ 3,908 $40,171 $ 1,121 $ 12 $4,931 $ 11
<PAGE>
25A
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
<CAPTION>
D E P A R T M E N T OR S E R V I C E F U N C T I O N
ACCOUNT SYSTEM PROCESS BUSINESS GOVERNMENT STRATEGIC CORPORATE
NUMBER PLANNING SERVICES DEVELOPMENT COMMUNICATIONS RELATIONS TREASURY PLANNING GENERAL
<S> <C> <C> <C> <C> <C> <C> <C> <C>
920 $3,062 $4,241 $ 455 $ 314 $ 388 $3,075 $ 189 $ 117
921 203 639 65 360 154 272 (3) (3)
922
923 265 526 33 79 77 136 24
924
925 15 19 2 2 1 16 1
926 760 933 100 117 74 736 55 11,883
928
930.1 3 2 4
930.2 3 4 230 22 1
931 93 184 1 2 128 197 24 1
932 5 366 17 1 25 38
403 63
408 230 283 30 23 23 224 17
409
410
411
411.5
421
426.1 25 152
426.5 (407)
427
430
431
TOTAL $4,633 $7,194 $ 732 $1,283 $ 894 $4,699 $ 307 $11,654
<PAGE>
26
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
DEPARTMENTAL ANALYSIS OF SALARIES
ACCOUNT 920
<CAPTION>
DEPARTMENTAL SALARY EXPENSE NUMBER
NAME OF DEPARTMENT INCLUDED IN AMOUNTS BILLED TO PERSONNEL
Indicate each department TOTAL PARENT OTHER NON END OF
or service function. AMOUNT COMPANY ASSOCIATES ASSOCIATES YEAR
<S> <C> <C> <C> <C> <C>
Accounting $ 6,541 $ 26 $ 6,515 $ - 113
Taxes 961 1 960 - 13
Business Planning 979 - 979 - 10
Corporate Secretary 1,249 82 1,167 - 22
Legal 951 1 950 - 33
Human Resources 2,769 - 2,769 - 34
Materials and Services 3,219 85 3,134 - 57
Executive 3,416 984 2,432 - 9
Internal Auditing 2,658 - 2,658 - 39
Information Services 22,142 - 22,141 1 351
Power Supply 725 - 725 - 7
System Operations 3,542 - 3,542 - 69
System Planning 3,066 - 3,066 - -
Process Services 4,366 - 4,366 - 56
Business Development 455 - 455 - -
Communications 634 54 580 - 7
Government Relations 398 - 398 - 5
Treasury 3,075 58 3,017 - 34
Strategic Planning 189 - 189 - -
TOTAL $61,335 $1,291 $60,043 $ 1 859
<PAGE>
27
ANNUAL REPORT OF GPU SERVICE,INC.
For the Year Ended December 31, 1996
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a breakdown by subaccount of outside services employed. If the
aggregate amounts paid to any one payee and included within one subaccount
is less than $100,000, only the aggregate number and amount of all such
payments included within the subaccount need be shown. Provide a subtotal
for each type of service.
<CAPTION>
RELATIONSHIP
"A"= ASSOCIATE
FROM WHOM PURCHASED TYPE OF SERVICE/LARGEST INVOICE "NA"= NON AMOUNT
ASSOCIATE
Legal
<S> <C> <C> <C>
Abdallah & Muckelroy Intellectual Property Matters NA $ 114
Ballard, Spahr, Andrews Health Plans NA 283
& Ingersoll
Berlack, Israels & Liberman Issues arising under the Public NA 763
Utility Holding Company Act of 1935
Fried, Frank, Harris, Reviewed and suggested revisions NA 189
Shriver & Jacobson of employee benefit plans
Swidler & Berlin 1996 Telecom Act NA 122
55 Others (under $100,000) 123
Sub-Total 1,594
Engineering
8 Firms (under $100,000) NA 136
Sub-Total 136
<PAGE>
27A
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a breakdown by subaccount of outside services employed. If the
aggregate amounts paid to any one payee and included within one subaccount
is less than $100,000, only the aggregate number and amount of all such
payments included within the subaccount need be shown. Provide a subtotal
for each type of service.
<CAPTION>
RELATIONSHIP
"A"= ASSOCIATE
FROM WHOM PURCHASED TYPE OF SERVICE/LARGEST INVOICE "NA"= NON AMOUNT
ASSOCIATE
Other Professional Services
<S> <C> <C> <C>
Advanced Research Mgmt. Diversity Management NA 173
Consultant
AON Consulting Consulting in conjunction with NA 211
the retirement plan & health
communication project
The Boston Consulting Consulting for GPU's Strategic NA 110
Group, Inc. Planning Working Group
DRI/McGraw Hill Economic Forecasting NA 105
Gartner Group, Inc. Research & Advisory Services NA 177
for Choice 5 Programs
Godwins, Inc. Consulting charges in conjunction NA 200
with the retirement plan & health
& welfare communication project
Nemeth/Martin Personnel Customer Accounting System Study NA 158
Peoplesoft, Inc. EDS Consulting General NA 490
The Technical Resource Update Computer Systems NA 104
Group, Inc.
278 Others (under $100,000) 3,244
Subtotal 4,972
Grand Total $6,702
</TABLE>
<PAGE>
28
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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
CAFETERIA SUPPLEMENT $ 357
SOCIAL CLUB 34
VOLUNTARY ENHANCED RETIREMENT PROGRAM (VERP) 11,502
HOSPITAL, SURGICAL, MEDICAL & DENTAL INSURANCE 4,595
PENSION PLANS 394
EMPLOYEE SAVINGS PLAN 1,972
LONG TERM DISABILITY 437
VACATION ACCRUAL 3,320
OPEB LIFE INSURANCE 501
OPEB HEALTH INSURANCE 3,580
OTHER BENEFITS (Under $25,000) 131
TOTAL $26,823
<PAGE>
29
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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
Editorial, Educational,
& Informational Various $ 5
Investor Information Standard & Poor's 5
Newspaper, Magazine,
& Pamphlet Various 27
TOTAL $ 37
<PAGE>
30
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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
Dues & Memberships $ 208
Company Sponsored Community Activities 323
TOTAL $ 531
<PAGE>
31
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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
BUILDINGS $ 626
DATA PROCESSING EQUIPMENT 6,142
DUPLICATING EQUIPMENT 174
LICENSES & PC SOFTWARE 367
MAILING EQUIPMENT 14
ON-LINE DATA SERVICES 57
OTHER OFFICE EQUIPMENT 12
PERSONAL COMPUTERS 512
TELECOMMUNICATIONS SYSTEM 400
MISCELLANEOUS 6
TOTAL $ 8,310
<PAGE>
32
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
TAXES OTHER THAN INCOME TAXES
ACCOUNT 408
INSTRUCTION: 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
(1) OTHER THAN U.S. GOVERNMENT TAXES
Local Real Estate - New Jersey $ 633
- Pennsylvania 462
New Jersey Unemployment Insurance 132
Pennsylvania Unemployment Insurance 125
Pennsylvania Sales & Use 863
Sub Total 2,215
(2) TAXES - U.S. GOVERNMENT
Federal Unemployment Insurance 230
FICA 3,918
Sub Total 4,148
TOTAL $6,363
<PAGE>
33
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
DONATIONS
ACCOUNT 426.1
INSTRUCTION: 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
United Way of Morris County Community Charities $ 8
United Way of Berks County Community Charities 11
Hershey Medical Center Health Services/Hospitals 3
Cancer Care Health Services/Hospitals 5
19 Organizations (Under $3,000) Health Services/Hospitals 13
Harvard University Education 50
United Negro College Fund Education 5
County College of Morris Education 3
Marine Corps Law Enforcement Education 3
Foundation
16 Organizations (Under $3,000) Education 8
Eva's Kitchen Community Services 5
Police Ath. League of Parsippany Community Services 5
D. O'Brien Child Advocacy Center Community Services 7
Coalition to Keep NJ Working Community Services 20
The Nature Conservancy Community Services 25
Freedom House Community Services 10
Governor's Council for a Community Services 5
Drug Free Community
47 Organizations (Under $3,000) Community Services 22
N.J. Shakespeare Festival Cultural Development 7
Waterloo Foundation for the Arts Cultural Development 5
Colonial Symphony Cultural Development 5
3 Organizations (Under $3,000) Cultural Development 5
TOTAL $230
<PAGE>
34
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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
Company Owned Life Insurance Premiums Massachusetts Mutual $(406)
Life Insurance Co.
TOTAL $(406)
<PAGE>
35
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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.
NONE
<PAGE>
36
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
ORGANIZATION CHART
-------------------------------------------------------
| BOARD OF DIRECTORS |
| Chairman, President & CEO |
-----------------------------------------------------|
| Executive Vice President & |
| General Counsel |
|--------------------------------------------|
| | Corporate Secretary |
| |---------------------------------------|
| | Director - Corporate Legal Services |
| |---------------------------------------|
| | V.P. Government Affairs |
| |---------------------------------------|
| Executive Vice President & |
| Chief Financial Officer |
|--------------------------------------------|
| | Vice President & Treasurer |
| |---------------------------------------|
| | Sr. V.P. Financial Controls |
| |---------------------------------------|
| | Asst. Compt. - Acctg. |
| |-----------------------------------|
| | Asst. Compt. - Bus. Plng. & Taxes |
| |-----------------------------------|
| Executive V.P. - Power Supply Group |
|--------------------------------------------|
| | V.P. System Operations |
| |---------------------------------------|
| | V.P. System Planning |
| |---------------------------------------|
| Sr. V.P. System Services |
|--------------------------------------------|
| | V.P. Information Technology Services |
| |---------------------------------------|
| | Director - Materials and Services |
| |---------------------------------------|
| | Director - Process Services |
|--------------------------------------------|
| V.P. Internal Auditing |
|--------------------------------------------|
| V.P. Human Resources |
|--------------------------------------------|
| V.P. Communications |
---------------------------------------------
<PAGE>
37
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
METHODS OF ALLOCATION
1. Multiple Factor:
The average of the following three factors:
A. Gross Distribution Plant at Year-End
B. Energy Sales (MWH) to Ultimate Customers
C. O & M Expense, Excluding Purchased Power
2. Size Factor:
Forecasted capacity responsibility for the
planning period, June - May.
3. Conventional Steam Capacity:
Installed capacity at year-end (MW)
4. Nuclear Steam Capacity:
Installed capacity at year-end (MW)
5. Combustion Turbine Capacity:
Installed capacity at year-end (MW)
6. Three (3) Factor:
Multiple Factor billed to Jersey Central Power & Light Company,
Pennsylvania Electric Company, and Metropolitan Edison Company.
Each Division/Function is assigned one of the above factors for allocating
indirect costs to groups of associated companies. The allocation factor is
based upon each Division/Function's type of work and is reviewed annually.
<PAGE>
38
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
ANNUAL STATEMENT OF COMPENSATION FOR USE OF CAPITAL BILLED
NONE
<PAGE>
39
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
VENTURE DISCLOSURES
LICENSING OF COMPUTER PROGRAMS TO NON-ASSOCIATE COMPANIES
Pursuant to the provisions contained in the Securities and Exchange
Commission (SEC) Order dated August 29, 1990 for SEC File No. 70-7675, GPU
Service, Inc. did not enter into any transactions or recognize any revenues
during the calendar year 1996 for activities related to the licensing of
computer programs to non-associated companies.
LEASING OF RESERVE COMPUTER CAPACITY
Pursuant to the provisions contained in the Securities and Exchange
Commission (SEC) Order dated November 27, 1991 for SEC File No. 70-7841, GPU
Service, Inc. received revenues during 1996 from New York State Electric and
Gas and Consumers Water Company, non-associated companies, for reserve
computer capacity. These revenues are shown separately on page 22 of this
report.
LICENSING OF AUTOMATED MATERIALS MANAGEMENT SYSTEM (AMMS)
COMPUTER PROGRAMS TO NON-ASSOCIATE COMPANIES
Pursuant to the provisions contained in the Securities and Exchange
Commission (SEC) Order dated December 3, 1991 for SEC File No. 70-7871, GPU
Service, Inc. did not receive AMMS licensing revenues during 1996.
FIBER OPTIC LEASE AGREEMENT
Pursuant to the provisions contained in the Securities and Exchange
Commission (SEC) Order dated August 2, 1994 for SEC File No. 70-7850, GPU
Service, Inc. incurred no revenues or expenses during the year for this
agreement. All revenues and expenses incurred by Jersey Central Power & Light
Company and Metropolitan Edison Company are reported on GPU's 1996 Form U5S.
SERVICES TO NON-AFFILIATED UTILITIES AND RESERVING JURISDICTION
Pursuant to the provisions contained in the Securities and Exchange
Commission (SEC) Order dated November 5, 1996 for SEC File No. 70-8805, GPU
Service, Inc. did not enter into any transactions or recognize any revenues
during the calendar year 1996 for activities related to the services to non-
affiliated utilities and reserving jurisdiction.
ENTRY INTO NON-UTILITY BUSINESS AND RESERVATION OF JURISDICTION
Pursuant to the provisions contained in the Securities and Exchange
Commission (SEC) Order dated August 16, 1996 for SEC File No. 70-8817, GPU
Service, Inc. did not enter into any transactions or recognize any revenues
during the calendar year 1996 for activities related to the entry into non-
utility business and reservation of jurisdiction.
<PAGE>
ANNUAL REPORT OF GPU SERVICE, INC.
For the Year Ended December 31, 1996
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 undersigned officer thereunto
duly authorized.
GPU SERVICE, INC.
(Name of Reporting Company)
By: /s/ P. R. Chatman
(Signature of Signing Officer)
P. R. Chatman, Assistant Comptroller
(Printed Name and Title of Signing Officer)
Date: April 21, 1997
<PAGE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> OPUR2
<NAME> GPU SERVICE, INC.
<MULTIPLIER> 1,000
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<EXCHANGE-RATE> 1
<BOOK-VALUE> PER-BOOK
<NET-SERVICE-COMPANY-PROPERTY> 56,891
<TOTAL-INVESTMENTS> 17,568
<TOTAL-CURRENT-ASSETS> 26,996
<TOTAL-DEFERRED-DEBITS> 12,495
<OTHER-ASSETS-AND-DEBITS> 0
<TOTAL-ASSETS-AND-DEBITS> 113,950
<TOTAL-PROPRIETARY-CAPITAL> (1,806)
<TOTAL-LONG-TERM-DEBT> 36,181
<NOTES-PAYABLE> 0
<NOTES-PAYABLE-ASSOCIATE-COMP> 0
<OTHER-CURR-AND-ACCRUED-LIAB> 60,770
<TOTAL-DEFERRED-CREDITS> 10,184
<DEFERRED-INCOME-TAX> 8,621
<TOT-LIABIL-AND-PROPRIET-CAP> 113,950
<SERVICES-ASSOCIATE-COMPANIES> 134,156
<SERVICES-NON-ASSOCIATE-COMP> 172
<MISC-INCOME-OR-LOSS> 16
<TOTAL-INCOME> 134,344
<SALARIES-AND-WAGES> 61,335
<EMPLOYEE-PENSION-AND-BENEFIT> 26,823
<OTHER-EXPENSES> 46,186
<TOTAL-EXPENSES> 134,344
<NET-INCOME> 0
<TOTAL-EXPENSES-DIRECT-COST> 108,263
<TOTAL-EXPENSES-INDIRECT-COST> 26,081
<TOT-EXP-DIRECT-AND-INDIRECT> 134,344
<PERSONNEL-END-OF-YEAR> 859
<FN>
</FN>
<PAGE>
</TABLE>
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