N.Y. Comp. Codes R. & Regs. tit. 16, § 563.5 – Water plant purchased or sold.

(a) When water plant constituting an operating unit or system is acquired by purchase, merger, consolidation, liquidation or otherwise, after the effective date of this system of accounts, the costs of acquisition, including expenses incidental thereto properly includible in water plant, shall be charged to account 102, Water Plant Purchased or Sold.
(b) The accounting for the acquisition shall then be completed as follows:
1. (1) The original cost of plant, estimated if not known, shall be credited to account 102, Water Plant Purchased or Sold, and concurrently charged to the appropriate water plant in service accounts and to account 104, Water Plant Leased to Others, account 105, Water Plant Held for Future Use, and account 107, Construction Work in Progress—Water, as appropriate.
2. (2) The depreciation and amortization applicable to the original cost of the properties purchased, shall be charged to account 102, Water Plant Purchased or Sold, and concurrently credited to the appropriate account for accumulated provision for depreciation or amortization.
3. (3) The cost to the utility of any property includible in account 121, Nonutility Property, shall be transferred thereto.
4. (4) The remaining amount of contributions in aid of construction, which have not been identified with and credited to specific water plant acquired, shall be disposed of in accordance with provisions of water plant instruction, section 563.2(e) of this Part.
5. (5) The amount remaining in account 102, Water Plant Purchased or Sold, shall then be closed to account 114, Water Plant Acquisition Adjustments, unless otherwise authorized by the commission.
(c) If property acquired in the purchase of an operating unit or system is in such physical condition when acquired that it is necessary substantially to rehabilitate it in order to bring the property up to the standards of the utility, the cost of such work, except replacements, shall be accounted for as part of the purchase price of the property.
(d) When any property acquired as an operating unit or system includes duplicate or other plant which will be retired by the accounting utility in the reconstruction of the acquired property or its consolidation with previously owned property, the proposed accounting for such property shall be presented to the commission.
(e) In connection with the acquisition of water plant constituting an operating unit or system, the utility shall procure, if possible, all existing records relating to the property acquired, or certified copies thereof, and shall preserve such records in conformity with regulations or practices governing the preservation of records of its own construction.
(f) When water plant constituting an operating unit or system is sold, conveyed or transferred to another by sale, merger, consolidation or otherwise, the book cost of the property sold or transferred to another shall be credited to the appropriate utility plant accounts, including amounts carried in account 114, Water Plant Acquisition Adjustments, and the amounts (estimated if not known) carried with respect thereto in the accounts for accumulated provisions for depreciation and amortization and in account 252, Customer Advances for Construction, shall be charged to such accounts and the contra entries made to account 102, Water Plant Purchased or Sold. Unless otherwise ordered by the commission, the difference, if any, between (1) the net amount of debits and credits and (2) the consideration received for the property (less commissions and other expenses of making the sale) shall be included in account 421.1, Gain on Disposition of Property, or 421.2, Loss on Disposition of Property. (See account 102, Water Plant Purchased or Sold.)
Note:
In cases where existing utilities merge or consolidate because of financial or operating reasons or statutory requirements rather than as a means of transferring title or purchased properties to a new owner, the accounts of the constituent utilities, with the approval of the commission, may be combined. In the event original cost has not been determined, the resulting utility shall proceed to determine such cost as outlined herein.