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 
4360, Other 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 5069, Other Local Exchange Revenue Settlements, 5129, Other 
Long Distance Private Network Revenue Settlements, 5169, Other Long 
Distance Revenue Settlements, or 5269, Other Revenue Settlements, as 
appropriate.
    (f) Subsidiary records--jurisdictional subdivisions. (1) 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. Such subsidiary 
record categories shall be reported as required by part 43 of this 
Commission's Rules and Regulations.
    (2) This jurisdictional subsidary record requirement applies to all 
accounts except the Network Access Services Group where separate 
accounts have been established for Federal and state access revenues.
    (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 five major groups--Local Network

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Services Revenues, Network Access Services Revenues, Long Distance 
Network Services Revenues, Miscellaneous Revenues, and Uncollectible 
Revenues, which shall be considered as a revenue group for the purposes 
of the construction of the system.
    (3) Summary accounts within revenue groups shall be used to describe 
aggregations of two or more accounts having a certain commonality. 
Summary accounts are assigned numbers so that they may be used by Class 
A telephone companies to aggregate accounts for reporting purposes; and, 
as specifically directed, so that they may be used as accounts by Class 
B telephone companies.
    (4) 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 5000-5069) 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 
5080-5084) 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 and when such 
activity is accounted for, as required in Sec. 32.23(c) of this subpart, 
within the accounts prescribed in this system for telephone company 
operations. 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...................   \1\ 5000       5000
    Basic area revenue............................       5001  .........
    Optional extended area revenue................       5002  .........
    Cellular mobile revenue.......................       5003  .........
    Other mobile services revenue.................       5004  .........
    Public telephone revenue......................       5010  .........
    Local private line revenue....................       5040  .........
    Customer premises revenue.....................       5050  .........
    Other local exchange revenue..................       5060  .........
    Other local exchange revenue settlements......       5069  .........
Network Access Services Revenues:                                       
    Network access revenue........................   \1\ 5080       5080
    End user revenue..............................       5081       5081
    Switched access revenue.......................       5082       5082

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    Special access revenue........................       5083       5083
    State access revenue..........................       5084       5084
Long Distance Network Services Revenues:                                
    Long distance message revenue.................       5100       5100
    Unidirectional long distance revenue..........   \1\ 5110  .........
    Long distance inward-only revenue.............       5111  .........
    Long distance outward-only revenue............       5112  .........
    Long distance private network revenue.........   \1\ 5120  .........
    Subvoice grade long distance private network                        
     revenue......................................       5121  .........
    Voice grade long distance private network                           
     revenue......................................       5122  .........
    Audio program grade long distance private                           
     network revenue..............................       5123  .........
    Video program grade long distance private                           
     network revenue..............................       5124  .........
    Digital transmission long distance private                          
     network revenue..............................       5125  .........
    Long distance private network switching                             
     revenue......................................       5126  .........
    Other long distance private network revenue...       5128  .........
    Other long distance private network revenue                         
     settlements..................................       5129  .........
    Other long distance revenue...................       5160  .........
    Other long distance revenue settlements.......       5169  .........
Miscellaneous Revenues:                                                 
    Miscellaneous revenue.........................  .........       5200
    Directory revenue.............................       5230  .........
    Rent revenue..................................       5240  .........
    Corporate operations revenue..................       5250  .........
    Miscellaneous revenue.........................   \1\ 5260  .........
    Special billing arrangements revenue..........       5261  .........
    Customer operations revenue...................       5262  .........
    Plant operations revenue......................       5263  .........
    Other incidental regulated revenue............       5264  .........
    Other revenue settlements.....................       5269  .........
    Carrier billing and collection revenue........       5270  .........
Nonregulated Revenues:                                                  
    Nonregulated operating revenue................       5280       5280
Uncollectible Revenues:                                                 
    Uncollectible revenue.........................   \1\ 5300       5300
    Uncollectible revenue--Telecommunications.....       5301  .........
    Uncollectible revenue--Other..................       5302  .........
------------------------------------------------------------------------
\1\ To be used by Class A telephone companies to summarize accounts for 
  reporting purposes.                                                   

[ 51 FR 43499 , Dec. 2, 1986, as amended at  53 FR 49322 , Dec. 7, 1988;  59 FR 46930 , Sept. 13, 1994]