Form U-13-60
Mutual and Subsidiary Service Companies*
Revised February 7, 1980
ANNUAL REPORT
FOR THE PERIOD
Beginning January 1, 1995 and Ending December 31, 1995
TO THE
U.S. SECURITIES AND EXCHANGE
COMMISSION
OF
AYP Capital, Inc.
A Nonutility Subsidiary*
Date of Incorporation: August 18, 1994.
If not incorporated, Date of Organization: not applicable.
State or Sovereign Power under which Incorporated or Organized: Delaware.
Location of Principal Executive Offices of Reporting Company:
10435 Downsville Pike, Hagerstown, MD.
Name, title, and address of officer to whom correspondence concerning this
report should be addressed:
Thomas J. Kloc, Controller
AYP Capital, Inc.
10435 Downsville Pike
Hagerstown, MD 21740-1766.
Name of Principal Holding Company Whose Subsidiaries are served* by Reporting
Company:
Allegheny Power System, Inc.
SEC 1926 (6-82)
*Note that this report is being used for a nonutility subsidiary of such
Holding Company.
<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 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. 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 Section 210.3-01(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, Section 210.3-01(c)).
7. Major amendments or corrections. Any company desiring to amend or
correct a major omission or error in a report after is 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 state-
ment 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
Description of Schedule or Page
Schedules and Accounts: Account No.: No.:
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 Expenses 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>
3
LISTING OF INSTRUCTIONAL FILING REQUIREMENTS
Description of Page
Reports or Statements: No.:
Organizational Chart 36
Methods of Allocation 37
Annual Statement of Compensation for Use of Capital Billed 38
<PAGE>
4
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE I - COMPARATIVE BALANCE SHEET
Give balance sheet of the Company as of December 31 of the current and prior
year.
<TABLE>
<CAPTION>
Account Assets and Other Debits Current Prior
Property
<C> <S> <C> <C>
101 Property (Schedule II) 17,232 0
107 Construction work in progress (Schedule II) 0 0
Total Property 17,232 0
108 Less Accumulated provision for depreciation
and amortization of property (Schedule III) 1,436 0
Net Property 15,796 0
Investments
123 Investments in associate companies
(Schedule IV) 1,075,979 0
124 Other investments (Schedule IV) 0 0
Total Investments 1,075,979 0
Current and Accrued Assets
131 Cash 16,764 0
134 Special deposits 0 0
135 Working funds 0 0
136 Temporary cash investments (Schedule IV) 0 0
141 Notes receivable 0 0
143 Accounts receivable 9,720 0
144 Accumulated provision for uncollectible
accounts 0 0
146 Accounts receivable from associate
companies (Schedule V) 52,240 0
152 Fuel stock expenses undistributed (Schedule VI) 0 0
154 Material and supplies 0 0
163 Stores expense undistributed (Schedule VII) 0 0
165 Prepayments 0 0
174 Miscellaneous current and accrued
assets (Schedule VIII) 0 0
Total Current and Accrued Assets 78,724 0
Deferred Debits
181 Unamortized debt expense 0 0
184 Clearing accounts 0 0
186 Miscellaneous deferred debits (Schedule IX) 275,573 0
188 Research, development, or demonstration
expenditures (Schedule X) 0 0
190 Accumulated deferred income taxes 0 0
Total Deferred Debits 275,573 0
Total Assets and Other Debits 1,446,072 0
</TABLE>
<PAGE>
5
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE I - COMPARATIVE BALANCE SHEET, CONTINUED
<TABLE>
<CAPTION>
Account Liabilities and Proprietary Capital Current Prior
Proprietary Capital
<C> <S> <C> <C>
201 Common stock issued (Schedule XI) 1,000 0
211 Miscellaneous paid-in capital (Schedule XI) 1,837,303 0
215 Appropriated retained earnings (Schedule XI) 0 0
216 Unappropriated retained earnings
(Schedule XI) (572,037) 0
Total Proprietary Capital 1,266,266 0
Long-term Debt
223 Advances from associate
companies (Schedule XII) 0 0
224 Other long-term debt (Schedule XII) 0 0
225 Unamortized premium on long-term debt 0 0
226 Unamortized discount on long-term
debt (debit) 0 0
Total Long-term Debt 0 0
Current and Accrued Liabilities
231 Notes payable 0 0
232 Accounts payable 204 0
233 Notes payable to associate
companies (Schedule XIII) 0 0
234 Accounts payable to associate
companies (Schedule XIII) 179,082 0
236 Taxes accrued 0 0
237 Interest accrued 0 0
238 Dividends declared 0 0
241 Tax collections payable 520 0
242 Miscellaneous current and accrued
liabilities (Schedule XIII) 0 0
Total Current and Accrued Liabilities 179,806 0
Deferred Credits
253 Other deferred credits 0 0
255 Accumulated deferred investment tax credits 0 0
282 Accumulated deferred income taxes 0 0
Total Deferred Debits 0 0
Total Liabilities and Proprietary Capital 1,446,072 0
</TABLE>
<PAGE>
6
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE II - PROPERTY
<TABLE>
<CAPTION>
Balance at Retiremts Other Balance at
Beginning or Changes Close
Account Decription of Year Additions Sales (1) of Year
301 Organization
303 Miscellaneous
intangible plant
304 Land and land
rights
305 Structures and
improvements
306 Leasehold
improvements
307 Equipment (2)
308 Office furniture
and equipment
309 Automobiles, other
vehicles and
related garage
<S> <C> <C> <C>
equipment 0 17,232 17,232
310 Aircraft and
airport equipment
311 Other property (3)
Subtotal 0 17,232 0 0 17,232
107 Construction work
in progress (4)
Total 0 17,232 0 0 17,232
(1) Provide an explanation of those changes considered material:
Not applicable.
</TABLE>
<PAGE>
7
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE II - CONTINUED
(2) Subaccounts are required for each class of equipment owned. The
company shall provide a listing by subaccount of equipment additions
during the year and the balance at the close of the year:
<TABLE>
<CAPTION>
Balance
at Close
Subaccount Description Additions of Year
Not applicable.
<S> <C> <C>
Total 0 0
</TABLE>
(3) Describe other property:
Not applicable.
(4) Describe construction work in progress:
Not applicable.
<PAGE>
8
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE III - ACCUMULATED PROVISION FOR
DEPRECIATION AND AMORTIZATION OF PROPERTY
<TABLE>
<CAPTION>
Balance at Additions Other Balance at
Beginning to Changes Close
Account Decription of Year Acct 403 Retiremts (1) of Year
301 Organization
303 Miscellaneous
intangible plant
304 Land and land
rights
305 Structures and
improvements
306 Leasehold
improvements
307 Equipment
308 Office furniture
and equipment
309 Automobiles, other
vehicles and
related garage
<S> <C> <C> <C>
equipment 0 1,436 1,436
310 Aircraft and
airport equipment
311 Other property
Total 0 1,436 0 0 1,436
(1) Provide an explanation of those changes considered material:
Not applicable.
</TABLE>
<PAGE>
9
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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.
<TABLE>
<CAPTION>
Balance at Balance at
Beginning Close
Description of Year of Year
Account 123- Investment in Associate Companies
<S> <C> <C>
EnviroTech Investment Fund I, LP, net 0 304,002
A 9.9% interest in a limited partnership to acquire
securities of companies with a primary emphasis on
investments in energy.
Latin America Energy and Electricity Fund I, LP 0 700,174
A 9.9% interest in a limited partnership to invest in
entities involved in new or existing electric power
projects in Latin America and the Caribbean.
APS Cogenex, LLC 0 71,803
A 50% joint venture with EUA Cogenex Corporation
formed to engage in demand-side management business
activities.
Account 124- Other Investments
Not applicable.
Account 136- Temporary Cash Investments
Not applicable.
Total 0 1,075,979
</TABLE>
<PAGE>
10
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE V - ACCOUNTS RECEIVABLE FROM ASSOCIATE COMPANIES
Instructions: Complete the following schedule listing accounts receivable
from each associate company. Where the 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.
<TABLE>
<CAPTION>
Balance at Balance at
Beginning Close
Description of Year of Year
Account 146- Accounts Receivable from Associate Companies
<S> <C> <C>
APS Cogenex, LLC 0 45,984
Latin America Energy and Electricity Fund I, LP 0 6,256
Total 0 52,240
</TABLE>
Analysis of Convenience or Accommodation Payments
Not applicable.
<PAGE>
11
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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 company.
<TABLE>
<CAPTION>
Description Labor Expenses Total
Account 152- Fuel Stock Expenses Undistributed
Not applicable.
<S> <C> <C> <C>
Total 0 0 0
</TABLE>
Summary:
Not applicable.
<PAGE>
12
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE VII - STORES EXPENSE UNDISTRIBUTED
Instructions: Report the amount of labor and expenses associated with
respect to stores expense during the year and indicate amount attributable to
each associate company.
<TABLE>
<CAPTION>
Description Labor Expenses Total
Account 163- Stores Expense Undistributed
Not applicable.
<S> <C> <C> <C>
Total 0 0 0
</TABLE>
<PAGE>
13
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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.
<TABLE>
<CAPTION>
Balance at Balance at
Beginning Close
Description of Year of Year
Account 174- Miscellaneous Current and Accrued Assets
Not applicable.
<S> <C> <C>
Total 0 0
</TABLE>
<PAGE>
14
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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.
<TABLE>
<CAPTION>
Balance at Balance at
Beginning Close
Description of Year of Year
Account 186- Miscellaneous Deferred Debits
Expenses associated with the purchase
<S> <C> <C>
of Fort Martin Unit #1 0 275,573
Total 0 275,573
</TABLE>
<PAGE>
15
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE X - RESEARCH, DEVELOPMENT, OR DEMONSTRATION EXPENDITURES
Instructions: Provide a description of each material research, development,
or demonstration project which incurred costs by the company
during the year.
<TABLE>
<CAPTION>
Description Amount
Account 188- Research, Development, or Demonstration
Expenditures
Not applicable.
<S> <C>
Total 0
</TABLE>
<PAGE>
16
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE XI - PROPRIETARY CAPITAL
Number of Par / Stated Outstanding Shares
Shares Value At Close of Period
Account Class of Stock Authorized Per Share Number Amount
201 Common Stock Issued 1,000 $10 100 $1,000
Instructions: Classify amounts in each account with brief explanation,
disclosing the general nature of transactions which give rise to the
reported amounts.
Account Description Amount
211 Miscellaneous Paid-in Capital* 1,837,303
215 Appropriated Retained Earnings 0
Total 1,837,303
* AYP Capital is funded in the form of capital contributions from the holding
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 nonassociates per the General Instructions of
the Uniform System of Accounts. For dividends paid during the year in cash
otherwise, provide rate percentage, amount of dividend, date declared and date
paid.
Balance at Net Balance at
Beginning Income Dividends Close
Account Description of Year (Loss) Paid of Year
216 Unappropriated Retained
Earnings 0 (572,037) 0 (572,037)
Total 0 (572,037) 0 (572,037)
<PAGE>
17
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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 the creditor company or organization,
terms of the obligation, date of maturity, interest rate, and the amount
authorized and outstanding.
<TABLE>
<CAPTION>
Terms, Date Balance at Balance
Class, & of Interest Amount Beginning (1) Close
Name of Creditor Series Maturity Rate Authorized of Year Additions Deductions of Year
223 Advances from associate
companies:
Not applicable.
224 Other long-term debt:
Not applicable.
<S> <C> <C> <C> <C> <C>
Total 0 0 0 0 0
</TABLE>
(1) Give an explanation of deductions.:
Not applicable.
<PAGE>
18
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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 then $10,000 may be grouped, showing the number of
items in each group.
<TABLE>
<CAPTION>
Balance at Balance at
Beginning Close
Description of Year of Year
Account 233- Notes Payable to Associate Companies
Not applicable.
<S> <C> <C>
Total 0 0
Account 234- Accounts Payable to Associate Companies
Allegheny Power Service Corporation 0 179,082
Total 0 179,082
Account 242- Miscellaneous Current and Accrued Liabilities
Not applicable.
Total 0 0
</TABLE>
<PAGE>
19
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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.
A. Property is stated at original cost.
B. Investments in the two limited partnerships and the joint venture are
accounted for under the equity method. That is, the initial investment is
recorded at cost, then the carrying amount is adjusted to recognize AYP
Capital's (the Company's) share of post-acquisition earnings or losses
of the investee.
C. The Company has entered into an agreement with Duquesne Light
Company, subject to regulatory approvals, to purchase its 50% interest in
Unit No. 1 of the Fort Martin Power Station for approximately $170
million. Necessary regulatory approvals will likely take several months,
and the Company expects a closing by late 1996.
D. The Company has committed to invest up to $10 million in two limited
partnerships formed to invest in emerging electrotechnologies that
promote the efficient use of electricity and improve the environment, and
to invest in and develop electric energy opportunities in Latin America.
<PAGE>
20
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE XV - COMPARATIVE STATEMENT OF INCOME
Give income statement of the Company for the current and prior years ending
December
<TABLE>
<CAPTION>
Account Description Current Prior
Income
<C> <S> <C> <C>
457 Services rendered to associate companies 0 0
458 Services rendered to nonassociate
companies 25,006 0
421 Miscellaneous income or loss (10,235) 0
Total Income 14,771 0
Expense
920 Salaries and wages 0 0
921 Office supplies and expenses 0 0
922 Administrative expense transferred - credit 0 0
923 Outside services employed 561,903 0
924 Property insurance 0 0
925 Injuries and damages 4,675 0
926 Employee pensions and benefits 0 0
928 Regulatory commission expense 0 0
930 .1 General advertising expense 0 0
930 .2 Miscellaneous general expenses 18,133 0
931 Rents 22 0
935 Maintenance of structures and equipment 0 0
403 Depreciation and amortization expense 1,436 0
408 Taxes other than income taxes 554 0
409 Income taxes 0 0
410 Provision for deferred income taxes 0 0
411 Provision for deferred income taxes - credit 0 0
411 .5 Investment tax credit 0 0
426 .1 Donations 0 0
426 Other deductions 82 0
427 Interest on long-term debt 0 0
430 Interest on debt to associate companies 0 0
431 Other interest expense 3 0
Total Expense 586,808 0
Net Income or (Loss) (572,037) 0
</TABLE>
<PAGE>
21
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
ANALYSIS OF BILLING
ASSOCIATE COMPANIES - ACCOUNT 457
Direct Indirect Comp. Total
Costs Costs for Use Amount
Name of Associate Company Charged Charged of Capital Billed
Not applicable.
Total 0 0 0 0
<PAGE>
22
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
ANALYSIS OF BILLING NONASSOCIATE COMPANIES
ACCOUNT 458
<TABLE>
<CAPTION>
Direct Indirect Comp. Excess Total
Cost Cost for Use Total or Amount
Name of Nonassociate Company Charged Charged of Capital Cost Deficiency Billed
<C> <C> <C> <C> <C>
(458.1) (458.2) (458.3) <C> (458.4)
EastAlco Aluminum Company 15,806
Schott Scientific Glass, Inc. 1,200
Broughton Foods, Inc. 8,000
Total 0 0 0 0 0 25,006
</TABLE>
Instructions: Provide a brief description of the services rendered to
each nonassociate company:
All listed companies are customers of AYP Capital's Transmission &
Distribution Services business line.
<PAGE>
23
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE XVI - ANALYSIS OF CHARGES FOR SERVICE
ASSOCIATE AND NONASSOCIATE COMPANIES
<TABLE>
<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
920 Salaries and wages
921 Office supplies and expense
922 Admin expense transferred - cr
923 Outside services employed This type of breakdown is
924 Property insurance not available for
925 Injuries and damages competitive job billings.
926 Employee pensions and benefits
928 Regulatory commission expense
930 .1 General advertising expenses
930 .2 Miscellaneous general expenses
931 Rents
935 Maint of structures and equip
403 Depreciation and amortiz exp
408 Taxes other than income taxes
409 Income taxes
410 Prov for def income taxes
411 Prov for def income taxes - cr
411 .5 Investment tax credit
426 .1 Donations
426 Other deductions
427 Interest on long-term debt
431 Other interest expense
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Total expenses 0 0 0 0 0 0 0 0 0
Comp for use of equity capital
430 Int on debt to assoc companies
Total cost of service 0 0 0 0 0 0 0 0 0
</TABLE>
Instructions: Total cost of service will equal for assocate and
nonassociate companies the total amount billed under their separate analysis
of billing schedules.
<PAGE>
24
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE XVII - EXPENSE DISTRIBUTION BY
DEPARTMENT OR SERVICE FUNCTION
<TABLE>
<CAPTION>
Department or Service Function
Total Over-
Description of Items Amnt head
920 Salaries and wages
921 Office supplies and expense
922 Admin expense transferred - credit
923 Outside services employed This type of breakdown is
924 Property insurance not applicable.
925 Injuries and damages
926 Employee pensions and benefits
928 Regulatory commission expense
930 .1 General advertising expenses
930 .2 Miscellaneous general expenses
931 Rents
935 Maint of structures and equipment
403 Depreciation and amortization expense
408 Taxes other than income taxes
409 Income taxes
410 Prov for def income taxes
411 Prov for def income taxes - credit
411 .5 Investment tax credit
426 .1 Donations
426 Other deductions
427 Interest on long-term debt
430 Interest on debt to associate companies
431 Other interest expense
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Total expenses 0 0 0 0 0 0 0 0 0
</TABLE>
Instructions: Indicate each department or service function.
(See Instruction 01-3, General Structure of Accounting System:
Uniform System of Accounts.)
<PAGE>
25
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
SCHEDULE XVII - EXPENSE DISTRIBUTION BY
DEPARTMENT OR SERVICE FUNCTION, CONTINUED
<TABLE>
<CAPTION>
Department or Service Function
Account
Number
920
921
922
923 This type of breakdown is
924 not applicable.
925
926
928
930 .1
930 .2
931
932
403
408
409
410
411
411 .5
426 .1
426 .5
427
430
431
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
0 0 0 0 0 0 0 0 0 0 0 0
</TABLE>
<PAGE>
26
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
DEPARTMENTAL ANALYSIS OF SALARIES
ACCOUNT 920
Departmental Salary Expense
Name of Department Included in Amounts Billed to Personnel
Indicate each department Total Parent Other Non- at Close
service function. Amount Company Associates Associates of Year
Not applicable.
Total 0 0 0 0 0
<PAGE>
27
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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 $25,000, 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.
From Whom Purchased Address Ralationship* Amount
Administrative and Engineering:
Allegheny Power Service CorporationGreensburg, PA A 451,932
Legal:
Sullivan & Cromwell New York, NY NA 66,065
Financial:
New Harbor, Inc. New York, NY NA 42,540
Other
Various (4 payees) NA 1,366
* "A" - Associate
"NA" - Nonassociate
Total 561,903
<PAGE>
28
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
EMPLOYEE PENSIONS AND BENEFITS
ACCOUNT 926
Instructions: Provide a listing of each pension plan and benefit program
provided by the company. Such listing should be limited to $25,000.
Description Amount
Not applicable.
Total 0
<PAGE>
29
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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.
Description Name of Payee Amount
Not applicable.
Total 0
<PAGE>
30
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
MISCELLANEOUS GENERAL EXPENSE
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 Sections 321(b)(2) of the
Federal Election Campaign Act, as amended by Public Law 94-283 in 1976
(2 U.S.C. Section 441(b)(2)) shall be separately classified.
<TABLE>
<CAPTION>
Description Amount
<S> <C>
Outside directors' fees and expenses 522
SEC filing fees 8,250
Miscellaneous, primarily an allocation of
shareholder expenses 9,361
Total 18,133
</TABLE>
<PAGE>
31
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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.
Type of Property Amount
Miscellaneous 22
Total 22
<PAGE>
32
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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.
<TABLE>
<CAPTION>
Kind of Tax Amount
Other than U.S. Government taxes:
<S> <C>
Capital stock or franchise tax expense 511
State gross premium tax expense 15
Other state tax expense 28
Subtotal 554
U.S. Government taxes:
Not applicable.
Subtotal 0
Total 554
</TABLE>
<PAGE>
33
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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
Not applicable.
Total 0
<PAGE>
34
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
OTHER DEDUCTIONS
ACCOUNT 426.5
Instructions: Provide a listing of the amount included in Accou
"Other Deductions", classifying such expenses according to their
Description Name of Payee Amount
Civic and political activities
Miscellaneous 82
Total 82
<PAGE>
35
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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.
Refer to Schedule XIV on page 19.
<PAGE>
36
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
ORGANIZATIONAL CHART
AYP Capital, Inc. has no employees - Allegheny Power Service Corporation
provides administrative and engineering services.
<PAGE>
37
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
METHODS OF ALLOCATION
AYP Capital, Inc. expenses are not allocated to associate companies.
<PAGE>
38
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
ANNUAL STATEMENT OF COMPENSATION FOR USE OF CAPITAL BILLED
AYP Capital, Inc. does not bill associate companies for use of holding company
capital
<PAGE>
39
Annual Report of AYP Capital, Inc.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1995
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.
AYP Capital, Inc.
(Name of Reporting Company)
By: THOMAS J. KLOC
(Signature of Signing Officer)
Thomas J. Kloc, Controller
(Printed Name and Title of Signing Officer)
April 25, 1996
(Date)
<TABLE> <S> <C>
<ARTICLE> OPUR2
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<EXCHANGE-RATE> 1
<BOOK-VALUE> PER-BOOK
<NET-SERVICE-COMPANY-PROPERTY> 15,796
<TOTAL-INVESTMENTS> 1,075,979
<TOTAL-CURRENT-ASSETS> 78,724
<TOTAL-DEFERRED-DEBITS> 275,573
<OTHER-ASSETS-AND-DEBITS> 0
<TOTAL-ASSETS-AND-DEBITS> 1,446,072
<TOTAL-PROPRIETARY-CAPITAL> 1,266,266
<TOTAL-LONG-TERM-DEBT> 0
<NOTES-PAYABLE> 0
<NOTES-PAYABLE-ASSOCIATE-COMP> 0
<OTHER-CURR-AND-ACCRUED-LIAB> 179,806
<TOTAL-DEFERRED-CREDITS> 0
<DEFERRED-INCOME-TAX> 0
<TOT-LIABIL-AND-PROPRIET-CAP> 1,446,072
<SERVICES-ASSOCIATE-COMPANIES> 0
<SERVICES-NON-ASSOCIATE-COMP> 25,006
<MISC-INCOME-OR-LOSS> (10,235)
<TOTAL-INCOME> 14,771
<SALARIES-AND-WAGES> 0
<EMPLOYEE-PENSION-AND-BENEFIT> 0
<OTHER-EXPENSES> 586,808
<TOTAL-EXPENSES> 586,808
<NET-INCOME> (572,037)
<TOTAL-EXPENSES-DIRECT-COST> 0
<TOTAL-EXPENSES-INDIRECT-COST> 0
<TOT-EXP-DIRECT-AND-INDIRECT> 0
<PERSONNEL-END-OF-YEAR> 0
</TABLE>
