Allowance for Doubtful Accounts

3 Months Ended

Mar. 31, 2020

Allowance for Doubtful Accounts [Abstract]

Note 10 — Allowance for Doubtful Accounts

Registrant adopted ASU 2016-13 Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments effective January 1, 2020. The guidance requires estimated credit losses on financial instruments, such as Registrant's trade and other receivable, be based on expected credit losses rather than incurred losses.

Registrant's allowance for doubtful account as of March 31, 2020 was developed based on observed effects of the economic impact of the COVID-19 pandemic on GSWC's aging of utility customer accounts receivable, as well as economic data such as unemployment rates and other considerations which may impact customers' ability to pay their bills. Management also took into consideration the impact of the CPUC's order to suspend through April 2021 service disconnections for nonpayments, which is expected to have the effect of increasing delinquent customer accounts receivable during the COVID-19 pandemic. However, the CPUC has authorized GSWC to track incremental costs, including bad debt expense in excess of what is included in GSWC's revenue requirement, incurred as a result of the COVID-19 pandemic in a CEMA account to be filed with the CPUC for future recovery. As a result, the adoption of ASU 2016-13 did not have a material earnings impact to Registrant.

The table below presents Registrant’s provision for doubtful accounts charged to expense and accounts written off, net of recoveries.



	Three Months Ended March 31, 2020
(dollars in thousands)	AWR			GSWC
Balances at December 31, 2019	$	916		$	916
Increase to provision	393			393
Accounts written off, net of recoveries	(164		)	(164		)
Balances at March 31, 2020	$	1,145		$	1,145

Allowance for doubtful accounts related to accounts receivable-customer	$	1,086		$	1,086
Allowance for doubtful accounts related to receivable from U.S. government	—			—
Allowance for doubtful accounts related to other accounts receivable	59			59
Total allowance for doubtful accounts	$	1,145		$	1,145