Sec.  32.4999   General.

   (a) Purpose of revenue accounts. The revenue accounts are intended to
   include the actual cash inflows (or equivalents) that have or will occur as
   a result of the company's ongoing major or central operations during the
   period. They will include the revenues which arise from furnishing regulated
   telecommunications services to others, from directory advertising, rentals
   of telecommunications assets and from providing other services which are
   directly associated with the provision of regulated telecommunications
   services.

   (b) Deductions from revenue. Corrections of overcharges, authorized refunds
   of overcollections previously credited to revenue, authorized refunds and
   adjustments on account of failure in service, and other corrections shall be
   charged to the revenue account previously credited with the amounts
   involved.

   (c) Commissions. Commissions paid to others or employees in place of
   compensation or salaries for services rendered, such as public telephone
   commissions, shall be charged to Account 6623, Customer services, and not to
   the revenue accounts. Other commissions shall be charged to the appropriate
   expense accounts.

   (d) Revenue recognition. Credits shall be made to the appropriate revenue
   accounts when such revenue is actually earned. When the billing cycle
   encompasses more than one accounting period, adjustments are necessary to
   properly recognize the revenue applicable to the current accounting period
   under report. Revenues recorded under the terms of two-tier contracts or
   other variable payment plans should be deferred, if necessary, and
   recognized ratably with expenses over the terms of the related contract. Any
   amounts deferred shall be credited to Account 4300, Other long-term
   liabilities and deferred credits.

   (e) Contractual arrangements. Charges and credits resulting from activities
   associated with the provisions of regulated telecommunications services
   shall be recorded in a manner consistent with the nature of the underlying
   contractual arrangements. The charges and credits resulting from expense
   sharing or apportionment arrangements associated with the provision of
   regulated telecommunications services shall be recorded in the detailed
   regulated accounts. Charges and credits resulting from revenue settlement
   agreements or other revenue pooling arrangements associated with the
   provision of regulated telecommunications services shall be included in the
   appropriate revenue accounts. Those charges and credits resulting from
   contractual revenue pooling and/or sharing agreements shall be recorded in
   each prescribed revenue account and prescribed subsidiary record categories
   thereof to the extent that each is separately identifiable in the settlement
   process. It is not intended that settlement amounts be allocated or
   generally spread to the individual revenue accounts where they are not
   separately identifiable in the settlement process. When the settlement
   amounts are not identifiable by a revenue account they shall be recorded in
   Account 5060, Other basic area revenue, 5105, Long distance message revenue,
   or 5200, Miscellaneous revenue, as appropriate.

   (f) Subsidiary records—jurisdictional subdivisions and interconnection.
   Subsidiary record categories shall be maintained in order that the company
   may separately report revenues derived from charges imposed under
   intrastate, interstate and international tariff filings. Class A carriers
   shall also maintain subsidiary record categories in order that the companies
   may separately report interconnection revenues derived from the following
   categories: Unbundled network element revenues, Resale revenues, Reciprocal
   compensation revenues, and Other interconnection revenues. Such subsidiary
   record categories shall be reported as required by part 43 of this
   Commission's Rules and Regulations.

   (g) Structure of revenue accounts. (1) The revenue section of the system of
   accounts shall be organized by revenue group summary account, account and
   subsidiary record category (if required).

   (2) The revenue section of this system of accounts shall be comprised of six
   major groups—Local Network Services Revenues, Network Access Services
   Revenues, Long Distance Network Services Revenues, Miscellaneous Revenues,
   Nonregulated revenues, and Uncollectible Revenues, which shall be considered
   as a revenue group for the purposes of the construction of the system.

   (3) Accounts shall be maintained as prescribed in this Section subject to
   the conditions described in section 32.13 of subpart B. In certain
   instances, subsidiary record categories may be required below the account
   level by this system of accounts or by Commission order.

   (h) Local Network Services revenues. Local Network Services revenues
   (Accounts 5001 through 5060) shall include revenues derived from the
   provision of service and equipment entirely within the basic service area.
   That area is defined as the normal boundaries for local calling plus
   Extended Area Service (EAS) boundaries as they apply to that service. It
   includes revenues derived from both local private network service and local
   public network services as well as from customer premises facilities
   services. Local revenues include associated charges such as one-time service
   connection or termination charges and secondary features such as call
   waiting.

   (i) Network Access revenues. (1) Network Access revenues (Accounts
   5081–5083) shall include revenues derived from the provision of exchange
   access services to an interexchange carrier or to an end user of
   telecommunications services beyond the exchange carrier's network.

   (2) Billing and collections service provided under exchange access tariffs
   shall be included in the Miscellaneous Revenues Group.

   (j) Long Distance Network Service revenues. Long Distance Network Service
   revenues shall include revenues derived from the provision of services
   beyond the basic service area, whether message or flat-rate and including
   public network switching as well as private.

   (k) Miscellaneous revenues. Miscellaneous revenues are those revenues
   derived from the provision of regulated products and services provided under
   tariff or contract but not contained elsewhere. They shall also include
   operating revenue derived from activities performed incident to the
   company's tariffed telecommunications operations which, though non-tariffed,
   are included in the regulatory process.

   (l) Nonregulated revenues. The nonregulated revenue account shall be used
   for nonregulated operating revenues when a nonregulated activity involves
   the common or joint use of assets or resources in the provision of regulated
   and nonregulated products or services as required in  Sec. 32.23(c) of this
   subpart. Revenues from nontariffed activities offered incidental to tariffed
   services may be accounted for as regulated revenues, provided the activities
   are outgrowths of regulated operations and the revenues do not exceed, in
   the aggregate, one percent of total revenues for three consecutive years.
   Such activities must be listed in the Commission-approved Cost Allocation
   Manual for any company required to file a Cost Allocation Manual.

   (m) Uncollectible revenues. Uncollectible revenues shall include amounts
   originally credited to the revenue accounts which have proved impracticable
   of collection.

   (n) Revenue accounts to be maintained.


------------------------------------------------------------------------
                                                     Class A    Class B
                   Account title                     account    account
------------------------------------------------------------------------
Local network services revenues:
    Basic local service revenue...................  .........       5000
    Basic area revenue............................       5001  .........
    Private line revenue..........................       5040  .........
    Other basic area revenue......................       5060  .........
Network access service revenues:
    End user revenue..............................       5081       5081
    Switched access revenue.......................       5082       5082
    Special access revenue........................       5083       5083
Long distance network services revenues:
    Long distance message revenue.................       5100       5100
Miscellaneous revenues:
    Miscellaneous revenue.........................       5200       5200
    Directory revenue.............................       5230  .........
Nonregulated revenues:
    Nonregulated operating revenue................       5280       5280
Uncollectible revenues:
    Uncollectible revenue.........................       5300       5300
------------------------------------------------------------------------

   [ 51 FR 43499 , Dec. 2, 1986, as amended at  53 FR 49322 , Dec. 7, 1988;  59 FR 46930 , Sept. 13, 1994;  64 FR 50008 , Sept. 15, 1999;  67 FR 5690 , Feb. 6,
   2002;  69 FR 53649 , Sept. 2, 2004]