(1) Every Utility shall prepare the Regulatory Accounts as per formats appended to these regulations under the historical Cost Convention in accordance with the provisions of the Act and the Regulations made by the Commission, Generally Accepted Accounting Principles in India, applicable Accounting Standards as notified under ( relevant provisions of the Companies Act, 2013 as well as Electricity (Supply) Annual Accounts Rules, 1985 if applicable). Where there is an inconsistency between the above mentioned principles, etc. and/ the Act or the regulations made by the Commission treatment of items in the Regulatory Accounts shall be given as per these Regulations made by the Commission.
(2) The Utility shall follow the Accounting Policies for Regulatory Accounts and the Standard Chart of Accounts while preparing the Regulatory Accounts as per the formats appended to these regulations. In case the Profit and Loss Account and the Balance Sheet does not comply with any of the Accounting Standards, a disclosure to the effect Compendium of HPERC Regulations, March 2021 5 shall be made in notes to accounts, including the deviation from the Accounting Standard, reasons for such deviation and the financial effect of the same.