This Paper Addresses The Current State Of Firstenergy Corp.,

1524 WordsFeb 26, 20177 Pages
This paper addresses the current state of FirstEnergy Corp., including an overview of the company’s history, subsidiaries, areas of operation, stock performance, and the recent change in business strategy. The paper goes on to describe how utility companies realize profit much differently than other companies and expresses the importance of accurate financials. The paper then addresses some of the issues faced by FirstEnergy’s accrual accounting process, and analyzes the problem using an A3 – Five Why analysis template to identify the background, current conditions, goals, analysis, proposal, plan, and follow up. Introduction FirstEnergy is a utility company that is currently facing some financial difficulties and is in the…show more content…
(About Us, 2017) FirstEnergy engages in generation, transmission and distribution of electricity and “produces approximately 80 million megawatt-hours of electricity annually from a fleet of carbon-free nuclear, scrubbed coal, natural gas, and hydro plants” (see Appendix B) (About Us, 2017). FirstEnergy is currently implementing the first phase of its “Energizing the Future” transmission upgrade project. This long-term initiative will receive a $4.2 billion investment from 2014 to 2017 is designed to increase service reliability and accommodate increased future demands (Transmission Projects, 2015). This project includes “replacing existing equipment with advanced technologies designed to enhance system reliability, meeting projected load growth driven primarily by sale gas-related activity in our region, and reinforcing the system in light of power plant deactivations” (Transmission Projects, 2015). Financial Struggles. Despite all of the efforts FirstEnergy is making toward improvements and technology advancements, the company has had a difficult time recovering from the 2008 financial crisis. Appendix C is a comparison of the percent of net change of FirstEnergy stock compared to competitors for the time period of 2007 – 2016 by month (Scottrade, n.d.). FirstEnergy’s stock price saw growth in 2007 and early 2008, but dropped significantly in mid to late 2008, and has never fully recovered

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