Big Rivers Electric Corporation
Big rivers Electric Corporation is a company that generates and transmits electricity. It is a partnership company that is a member –owned. The company is non-profit making company. It has three main cooperatives to which electric power and services are provided in wholesale. They include the Jackson Purchase Energy Corporation, Kenergy Corporation, and Meade County Rural Electric Cooperative Corporation. The three cooperatives distribute the electricity to 22 counties in western Kentucky.
According to financial statements for the year ended 31st, 2007, the Big Rivers Electric Corporation had a utility net of $ 911, 634. It had total utility net of $ 917, 668 in the previous year 2006. This indicates that the utility net had dropped by $ 6,034. At the same period, it had a restricted investment under long-term lease of $ 192,932 and $ 186,690 respectively. This records an increase. Deposits and investments were at $ 4,240 and $ 3,816 respectively indicating an increase too. The total current assets as of then for the two years, 2007 and 2006 were $ 176,496 and $ 118, 310 respectively. This was also an increase. Total capitalization stood at $ 1, 032, 099 and $ 1, 001, 059 for the year 2007 and 2006 respectively. There was thus and increase in capitalization in 2007. Total liabilities were $ 68, 187 for 2007 and $ 34, 339 for 2006 indicating a double in the year 2007. Total deferred credit slightly decreased in 2007 while contingency and commitments increased slightly in the year 2007. Operative revenue also increased considerably for the year 2007.
The same applies to operating margins that recorded an almost double in 2007. Nonoperating margin also recorded a big increase in 2007. There has been a general increase in the operating, expenses and nonoperating costs through 2005, 2006, and 2007. Therefore, the net margins of revenues from power contracts followed the same trend. The net balance at the close of the year, 31 December, 2007 was $ 174,137 that was a drop from $ 217, 371 of 2006.
The financial status of the company is stable based on its policy i.e. it is non-profit making. However, the expenditure seems to be increasing steadily, and this contributed to the lower net balance in 2007 compared to 2006.
There are too many managers earning a lot of money in the upper ranks. There is a need to reduce them so that the expenditure rates drops. There is a lot of wastage in some sections that are crowded with workers and thus, they can as well be reduced to save on the wages. An investment in machines can help in such a situation.
Big rivers Electric Corporation report 31st December, 2007. Retrieved from http://www.bigrivers.com/documents/BigRivers_2007FinancialStatements.pdf on 15-04-2014.