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an instance where the Commissioner changed the taxpayer’s method
of accounting. As we have held, respondent made no change to
petitioner’s method. However, we note that the court in Mamula
stated:
Once a taxpayer makes an election of one of two or more
alternative methods of reporting income, he should not
be permitted to convert, of his own volition, when it
later becomes evident that he has not chosen the most
advantageous method. * * * [Id. at 1018.]
Petitioner filed a protective request for a change of
accounting method after our prior Opinion at FPL Group Inc. &
Subs. v. Commissioner, 115 T.C. 554 (2000), in this case was
filed. Petitioner claims that the requested “method of
accounting” is required by section 1.162-4, Income Tax Regs.
Petitioner argues that respondent’s refusal to approve the
protective request was an abuse of discretion because respondent
required petitioner to continue to use an improper method; i.e.,
the FERC/FPSC method. Respondent denies that he ever determined
that petitioner’s use of the FERC/FPSC regulatory standards was
improper and, as we have previously indicated, the actions during
the examination do not establish that respondent made such a
determination. Petitioner seems to argue that we found in our
prior Opinion that petitioner’s use of the FERC/FPSC method of
accounting was improper. We disagree. We described petitioner’s
regulatory and financial accounting method as follows:
The FERC and FPSC rules provided a regulatory
accounting system which afforded petitioner a
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