4. ORA & TURN's Joint Petition to Modify D.02-10-020

A. Summary of the Joint Petition

Decision 02-10-020 ordered ORA to conduct a comprehensive audit of Verizon covering the years 1999 - 2002. In their petition to modify D.02-10-020, ORA and TURN ask the Commission to revise the audit period to 1999 - 2004 or, alternatively, 2000 - 2004. ORA and TURN state that it is advisable to revise the audit period so that the audit provides the Commission with current information.

B. SBC's and Verizon's Responses

SBC and Verizon oppose ORA and TURN's petition. SBC and Verizon argue that expanding the audit period will impose unnecessary costs on Verizon and its ratepayers. SBC also asserts that the audit period should not be expanded because there may be significant changes to Verizon's regulatory framework in R.05-04-005 that obviate the need for the audit.

Verizon states that expanding the audit period will not provide current information as ORA and TURN claim. This is because the audit report will be submitted in the next triennial review of NRF, which will not begin until 2009. Consequently, the data will be 5-10 years old when the audit report is submitted.

Verizon also asserts that ORA and TURN's proposal exceeds the requirements of Pub. Util. Code § 314.5,⁶ which requires the Commission to audit Verizon "at least once in every three years." Thus, an audit limited to three years or less would more than comply with § 314.5.

If the Commission is inclined to grant ORA and TURN's petition, SBC and Verizon recommend that the audit period be revised so that it covers only the three most recent years. Verizon opines that this alternate is preferable because it will provide current information while avoiding unnecessary audit costs.

⁶ All statutory references are to the Public Utilities Code unless otherwise indicated.