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RD 03/03
TO REGULATORY DIRECTORS OF ALL
WATER AND SEWERAGE COMPANIES AND
WATER ONLY COMPANIES
24 January 2003
Dear Regulatory Director
REPORTERS AND AUDITORS JOINT WORKSHOP 19
We held our nineteenth joint workshop with reporters and auditors on 19 December 2003. Sheila Reiter, Chairman of WaterVoice Wessex, was our guest for this workshop.
Our agenda covered the following items:
- The first tranche of work for PR04;
- Bringing reporters and auditors up to date with Ofwat's thinking on some key topics;
- A review of reporters' contributions during 2002;
- Reporters and auditors roles, work plans and approaches to the PR04 work;
- Ofwat's new financial model, Aquarius 3.
Philip Fletcher opened the workshop with a rundown of the major regulatory work and issues of the moment. These included:
- Vivendi's proposed purchase of Southern Water and the impact of the loss of an independent water company on the information required to support comparative competition;
- Interim Determinations, particularly the concerns about the link between levels of bad debt and the ban on disconnections, and the need for companies to present reasoned cases to support their IDoK proposals;
- the forthcoming Water Bill to be introduced to Parliament in early 2003;
- the customer surveys being jointly developed by Ofwat, DEFRA, Welsh Assembly Government, EA and DWI, English Nature, Wildlife & Countryside Link and Water UK.
The workshop then:
- Briefly reviewed the PR04 preparatory work, and the contributions by reporters and auditors to the technical workshops and information submissions;
- Reviewed reporters' performance for JR02, and illustrated the unit costs of reporters' work;
- We made presentations to the Best Reporters for JR02 as follows:
- Water & sewerage company Ben Haywood Smith and his team for their work on Yorkshire Water's June 2002 Return.
- Water only company Ian Cartwright-Taylor and his team for their work on Bristol Water's June 2002 Return.
- guidance and clarified the reporters and auditors roles for the 2003 Principal Statements, and also for the draft business plans;
- guidance for ensuring a uniform approach to depreciation;
- Cost Base consultation responses and the effect of capital efficiency on unit costs;
- reporters' involvement in an April workshop on the Capital Maintenance Common Framework and attendance at company/EA and Ofwat/company working level meetings;
- scenarios packages, reference levels and Draft Business Plan feedback;
- Presented a number of issues for the reporters' work and planning for PR04, particularly concerning guidance on key pricing issues, the best use of reporters' time windows and resources and the timetable for agreeing audit plans, and discussed Ofwat's expectations of the company's draft business plans.
- A teach in on the Aquarius 3 financial model.
Yours sincerely
IRENE MILLWARD
Reporters Co-ordinator
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