In making price determinations, the Independent Pricing and Regulatory Tribunal of NSW (IPART) has usually examined the indicative credit rating of the utility using various cash flow measures. Other regulators, such as the UK regulators, undertake similar analyses and refer to these as and#039financeability tests and#039. These measures are a factor in our consideration of the impact of the pricing decisions on factors such as the "borrowing, capital and dividend requirements" (section 15(1)(g), Independent Pricing and Regulatory Tribunal Act).

We have reviewed the derivation and use of financeability tests by IPART and other regulators and the way in which regulators have responded when the forecast results of these tests fall below benchmark levels.