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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Federal Communications Commission Washington, D.C. 20554 In reply refer to: RAO LETTER 17 Released: November 19, 1990 Responsible Accounting Officer Annual Report Form M--Corrections and Clarification of Certain Instructions and Schedules The purpose of this letter is to advise reporting carriers that we are making minor corrections to the Instructions and Schedules of the Annual Report Form M. The corrections to the Form M instructions are described in Attachment A, and the corrections to the Form M schedules are described in Attachment B. This letter and attachments are issued under Section 0.291 of the Commission's Rules. Applications for review under Section 1.115 of the Commission's Rules must be filed within 30 days from the date of public notice of this letter. If you have any questions, contact the Chief of the Accounting Systems Branch at (202) 418-0810. Sincerely, Kenneth P. Moran Chief, Accounting and Audits Division Common Carrier Bureau ATTACHMENT A The clarification and corrections to Form M Instructions appear below. General Instructions: Corrected paragraph (e) reads as follows: (e) Schedule B-1. Balance Sheet Accounts, and Schedule I-1, Income Statement Accounts, shall be filed in accordance with the provisions and instructions of the ARMIS USOA Order (Automated Reporting Requirements for Certain Class A and Tier 1 Telephone Companies (Parts 31, 43, 67 and 69 of the FCC's Rules) DA 88-2066, released January 6, 1989). Paper copies of Table I of the ARMIS USOA Report shall be redesignated as Schedule B-1 and Table II of the ARMIS USOA Report shall be redesignated as Schedule I-1 and filed as a part of the Form M. All footnotes filed with the ARMIS USOA Report shall also be filed as part of the Form M. Any discrepancies between data items filed in the ARMIS USOA Report and in the Form M must be noted. In addition, on Schedule I-1 carriers are required to show the total compensation for the year and the total number of employees at the end of the year in a footnote. The number of employees at the end of the year shall be broken down by full time and part time employees. Schedules redesignated as B-1, I-1 and Schedule B-6a are reported in thousands of dollars. All other schedules shall be rounded to the nearest dollar provided that amounts are appropriately adjusted to agree with the totals. Schedule B-1, Balance Sheet Accounts Corrected reference sentence in the instruction reads as follows: (See General Instruction (e).) Schedule B-6b, Analysis of Telecommunications Plant Adjustment Corrected Instruction 2 reads as follows: 2. Report on line 1 in column (c) the aggregate balance of acquisitions having debit balances and on line 1 in column (d) the aggregate balance of acquisitions having credit balances at the beginning of the calendar year. The net of aggregate debit and aggregate credit balances shall be reported on line 1 in column (e). Schedule B-7, Capital Leases Corrected Instruction 2 reads as follows: 2. In Column (a) on page 1, list in account number order each category of plant (Class B account level) for which capital leases are recorded. (See Section 32.2000(j) for Class B category of plant for Accounts 2110 through 2410.) Schedule B-10, Long-Term Debt The corrected title reads as follows: Schedule B-10--Long-Term Debt Schedule B-15, Capital Stock and Funded Debt Reacquired or Retired During the Year Corrected Instruction 5 reads as follows: 5. With respect to columns (i) to (n), inclusive, report dispositions of discounts, premiums, and expenses in the year in which the dispositions are made. Do not report normal amortization of amounts includable in Account 4220. Discount on Long-Term Debt, or Account 4230, Premium on Long-Term Debt, through charges or credits to Account 7510. Interest on Funded Debt. If any amounts are to be amortized, state that fact in a note, describe the plan of amortization (including the period thereof), and give references to (1) the public authorities (if any) having jurisdiction over each transaction, (2) their authorization (e.g., case or docket number), and (3) this Commission's approval of the proposed accounting. In columns (k) and (l) report the call or tender premiums associated with the reacquired securities, and in columns (m) and (n) report the other associated cost of reacquisition, including brokerage fees and unamortized discounts, premiums and issuance costs associated with the securities reacquired. Schedule I-1, Income Statement Accounts Corrected reference sentence in the instruction reads as follows: (See General Instruction (e).) Schedule I-6, Advertising Corrected Instruction 6 reads as follows: 6. On lines 8 through 27, individually disclose any advertising costs recorded in Account 7370, Special Charges. Definitions for Schedule-1, Outside Plant Statistics The definition for deep sea cable is separated from the definition of submarine cable and will appear as Item 11. Item 10 will remain Item 10. Items 9, 10, and 11 read as follows: 9. Submarine Cable--Cables that are submerged and cross large bodies of water. Cables in this environment are laid directly on the bottom and not enclosed within a protective cover, such as conduit. The cables in this environment can have transmission paths comprised of either metallic conductors or non-metallic fibers. 10. Submarine cable facilities can be found in both the distribution/exchange or interoffice facilities. 11. Deep Sea Cable--Cables that are designed for use in deep sea water, such as the Atlantic or Pacific Ocean. Items 11 and 12 are renumbered as Items 12 and 13. Items 25, 26, and 27 are renumbered as Items 14, 15, and 16. Items 13, 14, and 15 are renumbered as Items 17, 18, and 19 and renumbered Item 19 reads as follows: 19. Fiber Miles Lit--The portion of fiber miles that are equipped with electronics for transmission use or are ready for use. Items 16 through 22 are renumbered as Items 20 through 26 and renumbered Items 20 through 26 read as follows: 20. Number of Poles--The sum of solely owned and portions of jointly owned poles. 21. Equipped Miles of Tube in Coaxial Cable--Coaxial sheath miles times the number of tubes equipped with electronics. 22. Conduit System--Pipe placed in the ground (which is reusable in place) through which cables are pulled. 23. Trench Miles--Length of the ditch that contains the duct. 24. Duct Miles--The number of ducts times the trench miles. 25. Radio Relay--Equipment that is used to transmit and receive radio waves through space over which communications channels are provided. 26. Miles of System--Total distance between repeater sites making up microwave radio systems above 890 mhz. Where a system meets another company's system, only include mileage to the border of the adjacent company. Do not include satellite systems in this total. Item 23 renumbered as Item 27 and reads as follows: 27. Miles of Radio Channel--Total miles of one-way radio channel used for message, special services, video, or protection. A radio channel consists of a single link using a microwave transmitter and receiver. The radio channel mileage is the sum of the mileage of each link associated with a transmitter- receiver pair. Where a radio channel interfaces with that of another company, only include mileage to the border of the adjacent company. In the case of satellite systems, calculate mileage as the terrestrial distance between the receiver and transmitter terminal locations and add a footnote to indicate the satellite mileage included in the total. Item 24 renumbered as Item 28 and reads as follows: 28. Miles of Equivalent 4khz Telephone Channel--Number of equivalent 4khz telephone circuit miles that are equipped and on radio systems. This value is the weighted sum of the number of 4khz circuits on each link times the length of the link and is larger than the radio channel mileage unless most radio systems carry no active circuits. Items 28 through 33 are renumbered as Items 29 through 34. Renumbered Items 29, 30, 31, and 32 read as follows: 29. Total Equipped Channel Miles--Total equivalent 4khz telephone grade circuit miles in carrier plant. 30. Equivalent 4khz Analog Carrier Channel Miles--Includes open wire, paired cable (K, N1, N2, N3, N4, ON, ON/K), microwave radio (TL, TM, TD2, TD3), and other analog microwave. (Reported in circuit miles for interoffice only.) 31. Weighted DS-1 Digital (or Equivalent) Carrier Channel Miles--Includes lightguide (fiber) cables, digital subscriber paired cable (T1, T1C, T1D, T2), microwave radio (DR 11-40, other digital microwave). (Reported as equivalent 64kb/sec circuit miles for interoffice only.) Weight each DS-1 channel by multiplying by 24 before entering this data item, since a DS-1 can be equipped with up to 24 voice grade circuits operating at 64kb/sec. 32. Video--Miles of derived video channel. (Interoffice only.) Definitions for Schedule S-2, Access Lines in Service by Technology The title for Schedule S-2 in this caption is corrected and the caption reads as follows: Definitions for Schedule S-2--Switched Access Lines in Service by Technology Items 34 through 39 are renumbered as Items 35 through 40. Renumbered Items 35 and 40 read as follows: 35. Central Office Switch--A piece of electromechanical or electronic hardware for establishing connections from lines to lines, lines to trunks, and trunks to trunks. (Excludes operator service centers.) * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 40. Analog PBX and Centrex Access Trunks--Equivalent 4khz analog access circuits or trunks between the Central Office and a customer location PBX or Centrex; service is provided by equipment located on customer-controlled space including Centrex-CU Trunks, PBX Trunks, Hotel/Motel LD Trunks, and Multi-Line Semi-Public Lines. Item 40 is renumbered as Item 41 and reads as follows: 41. Analog Centrex Extensions--Equivalent 4khz circuits connecting a Centrex or PBX on telephone company premises to telephones on the customer's premises; service is provided by equipment on telephone company owned or leased space including Centrex-CO Lines. The definition for "Other" is separated from the other categories and will appear as Item 42. Item 42 reads as follows: 42. Other--Includes digital extensions and any switched access lines not included in columns (c) through (h). Use a footnote to itemize separate categories which are included here. Items 41 through 44 are renumbered as Items 43 through 46. Renumbered Item 46 reads as follows: 46. Do not include circuits that provide access to an interexchange carrier in this schedule. Definitions for Schedule S-3--Access Lines in Service by Customer Item 45 is renumbered as Item 47. Item 46 is renumbered as Item 48 and reads as follows: 48. Single Line Business--A single business network access line (based upon billing records) which serves one party (i.e., 1MB) and is billed at the single line subscriber line rate. Items 47 through 52 are renumbered as Items 49 through 54. Renumbered Items 49, 52, and 54 read as follows: 49. Multi-Line Business--Multi-Line business network access lines (based upon billing records) include Multi-Line Semi-Public Lines, PBX Trunks, Centrex-CU Trunks, Hotel/Motel LD Trunks and Centrex-CO Lines. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 52. Mobile Access Lines--Access lines to a common carrier base station using mobile radio. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 54. For Schedule S-3, ISDN and other digital access lines should be reported as 4khz or 64kb/sec equivalents. A DS-1 line, for example, corresponds to 24 4khz or 64kb/sec equivalents. Definitions for Schedule S-4--Telephone Calls Item 53 is renumbered as Item 55 and is placed as the first item under section "Definitions for Schedule S-4--Telephone Calls." Item 54 is renumbered as Item 56 and reads as follows: 56. All billed access minutes (originating and terminating) and call counts should reflect completed calls. Where completed call data is unavailable, you may estimate the number of completed calls, but indicate your methodology and source data in a footnote. Specific Instructions for Statistical Schedules Schedule S-1, Outside Plant Statistics Corrected Instruction 2 reads as follows: 2. Report the mileage at the end of the year for all solely owned plant and respondent's proportionate interest in jointly owned plant. Instruction 10 is renumbered as Instruction 5; Instruction 8 is renumbered as Instruction 6; Instruction 9 is renumbered as Instruction 7; and Instructions 5 through 7 are renumbered as Instructions 8 through 10. Renumbered Instructions 5, 9, and 10 read as follows: 5. Miles of fiber and miles of coaxial tube should be included in columns (d), (f), (h), (j), (l), (n), and (p) along with wire mileage even though the heading states "wire". * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 9. For column (r), provide the total deployed fiber miles, not just the amount equipped with carrier equipment or in service. 10. In columns (w), (x), and (y), report the aggregate number of miles of system or channel, as appropriate, between the individual stations or radio-relay systems. In column (y), include 64kb/sec digital circuit miles in the total, where applicable. Schedule S-2, Access Lines in Service By Technology The corrected title to Schedule S-2 reads as follows: Schedule S-2, Switched Access Lines in Service By Technology Corrected Instruction 2 reads as follows: 2. In column (b) provide for each state or territory the total number of Central Office Switches. If more than one switch is housed in a single building or structure, be sure to count each switch separately. Do not separately count each three-digit telephone number prefix as a separate switch. Column (b) should include the number of remote switches, but a footnote should be used to show the number of remote switches included in the total, where applicable. Corrected Instruction 4 reads as follows: 4. In column (d) provide the number of 64kb/sec or equivalent access lines or ISDN B channels where applicable. Do not include access lines connecting to a customer location PBX or Centrex. Instruction 10 is renumbered as Instruction 7 and Instructions 7 through 9 are renumbered as Instructions 8 through 10. Renumbered Instructions 7 and 10 and Instructions 11 and 12 read as follows: 7. Any individual 64kb/sec circuits to a PBX or Centrex not sold as part of an entire DS-1 should be noted in a footnote and added to column (f). If you do not know that a DS-1 associated with switched services connects to a customer PBX or Centrex, still include these in column (f) but provide their quantity in a footnote. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 10. In column (i) provide, in terms of equivalent 4khz Analog Circuits or 64kb/sec data circuits, the number of other switched access lines not included in columns (c) through (h), and indicate the types in a footnote. 11. Column (i) (other) should include digital Centrex extensions. Quantities for any item included in column (i) should be separately noted in a footnote. 12. This schedule should not include any special access lines. All special access lines should be included in Schedule S-3, column (g). Schedule S-3, Access Lines in Service By Customer Corrected Instructions 3, 4, and 5 read as follows: 3. In column (h), the total access lines is the total of columns (b) through (g). Total switched access lines, the total of columns (b) through (f) on Schedule S-3, should also equal the total of columns (c) through (i) on Schedule S-2. 4. Column (g) should include equivalent 64kb/sec. 4khz, or DS-1's weighted as in Schedule S-2. For example, the number of DS-1's should be multiplied by 24 before including in the total. If the customer does not have access to the entire DS-1, include the number of 64kb/sec or equivalent circuits the customer is being provided. Report in a footnote the number of special access lines included in column (g) which are digital. 5. Columns (b) through (f) on Schedule S-3 should equal the total of columns (c) through (i) on Schedule S-2; DS-1's should be multiplied by 24 before inclusion. Schedule S-4, Telephone Calls Corrected Instructions 6, 7 and 8 read as follows: 6. Billed access minutes should be based on bills sent to customers (interexchange carriers). Include total originating and terminating access minutes of use. For calls where this data is unavailable, a statistically valid calculation may be made based on other data. In such cases, provide a footnote describing the source data and methodology. 7. In column (d), the number of interstate toll calls includes outward calls, 800 service, directory service and dial-it service. Calls should not be double counted at the originating and terminating ends. 8. In column (f), the number of intrastate toll calls includes outward calls, 800 service, directory service, dial-it service, and optional calling plans. Calls should not be double counted at the originating and terminating ends. Schedule S-5, Interstate Private Line Statistics Corrected paragraph under Instruction 2 reads as follows: 2. * * * * * "Customers" denotes persons, firms, or corporations that contract for private line service and are responsible for the payment of charges and compliance with rules and regulations of the respondent. When more than one contract has been made with the same customer, count all contracts covering the same class of service billed to the customer at the same accounting center as one customer. Corrected Instruction 3 reads as follows: 3. Exclude from this schedule data relating to leases, the revenue from which is included in Account 5240, Rent Revenue. Checklist for Schedules S-1 through S-4 Corrected checklist reads as follows: Before submitting your FCC Form M statistical schedules, make the following consistency checks: 1. (Schedule S-1): Be sure that each nonzero entry in columns (d), (f), (h), (j), (l), or (n) is paired with a nonzero entry in columns (c), (e), (g), (i), (k), or (m) respectively, or vice versa. Any nonzero value less than 1 should not be represented as zero but may be listed as 1. 2. (Schedule S-1): Please check the number of miles of wire (column (p)) and the miles of cable (column (o)) and be sure you have provided all required data. Also, be sure you have provided wire miles in column (p) and not sheath miles. 3. (Schedule S-1): Miles of cable--Be sure that column (o) equals the total of columns (c), (e), (g), (i), (k), and (m). 4. (Schedule S-1): Miles of wire in cable--Be sure that column (p) equals the total of columns (d), (f), (h), (j), (l), and (n). 5. (Schedule S-1): If you have not included or have indicated as zero a figure for the number of fiber miles of fiber which is lit or equipped with carrier equipment in column (q), note that this data is now required. 6. (Schedule S-1): If you have not included a figure for the total number of fiber miles of fiber (lit and dark) deployed (column (r)) and you have fiber in your facility base, be sure that this information is provided. 7. (Schedule S-1): Please be sure that the number of fiber miles of lit fiber (column (q)) is less than the total number of fiber miles (column (r)). 8. (Schedule S-1): The number of equivalent 4khz channel miles (column (y)) should be greater than the number of miles of radio channel (column (x)), and the number of radio channel miles (column (x)) should be greater than the number of radio system miles (column (w)). Any nonzero entry in column (w) should generally be matched with nonzero entries in columns (x) and (y), and vice versa. Be sure that all required data are provided in columns (w), (x), and (y). 9. (Schedule S-1): If columns (z) and (aa) (carrier channel miles) are zero or blank, be sure all applicable data have been provided. 10. (Schedule S-1): If column (aa) is more than 100 million or less than 1 million, recheck the number and be sure that the number of DS-1 miles is appropriately weighted by 24. 11. (Schedule S-2): The number of switches listed in column (b) should not be zero for a local exchange carrier. 12. (Schedule S-2): If there are fewer than 1,000 access lines per switch, please check the number of switches (column (b)) and access lines (columns (c) through (i)). There may be too many switches indicated, too few access lines, or missing data. 13. (Schedule S-2): If there are more than 15,000 access lines per switch, please check the number of switches (column (b)) and access lines (columns (c) through (i)). There may be too few switches indicated or too many access lines. 14. (Schedule S-2): If your entries in columns (c), (d), and (f) are less than .5% of the entries in columns (c) through (i), verify that the amount of digital access in your facility base is this small. Please provide any missing data where applicable. 15. (Schedule S-2): If the ratio of column (d) to column (f) is less than 1 or more than 25, check the validity of data entered in columns (d) and (f). 16. (Schedule S-2): If you provide nondigital access to main telephones, please check to make sure that there is a nonzero entry in Schedule S-2, column (e). 17. (Schedule S-2): If column (f) is not a multiple of 24, please be sure that an appropriate footnote is provided as described in Instruction 7 of Schedule S-2. 18. (Schedule S-2): The total of columns (c) through (i) in Schedule S-2 should match column (h) minus column (g) in Schedule S-3. Total access lines should be the same no matter how categorized. In some cases a footnote may be required to explain discrepancies. Also, please make sure that special access lines are not included in Schedule S-2. 19. (Schedule S-3): The total switched access lines, columns (b) through (f), should equal the sum of columns (c) through (i) on Schedule S-2. 20. (Schedule S-3): Column (h) (Total Access Lines) divided by column (g) (Special Access Lines) should typically be less than 100. If you provide special access and your ratio exceeds 100, further follow-up may be necessary. 21. (Schedule S-4): If you have not included any interstate calls for column (d), note that column (d) should include all completed interlata toll interstate calls originating in your jurisdiction. Please review your submission to make sure you have provided all required data. 22. (Schedule S-4): The number of billed interstate call access minutes (column (e)) divided by the number of interstate calls (column d)) should approximate twice your average call holding time. If this is not true, or if the above ratio is less than 6 minutes, check columns (d) and (e). Zero or missing data could be causing this. Make sure you have provided all applicable data and that both originating and terminating access minutes have been included. 23. (Schedule S-4): The number of billed interstate call access minutes (column (e)) divided by the number of interstate calls (column (d)) should approximate twice your average call holding time. If this is not true, or if the above ratio is more than 16 minutes, please check columns (d) and (e). Zero or missing data could be causing this. Make sure that originating and terminating access minutes have been included. 24. (Schedule S-4): If you have not included any intrastate calls for column (f), note that column (f) should include all completed interlata toll intrastate calls originating in your jurisdiction. Please review your submission to make sure you have provided all required data. 25. (Schedule S-4): The number of billed intrastate call access minutes (column (g)) divided by the number of intrastate calls (column (f)) should approximate twice your average call holding time. If this is not true, or if the above ratio is less than 6 minutes, please check columns (g) and (f). Zero or missing data could be causing this. Make sure you have provided all applicable data and that both originating and terminating access minutes have been included. 26. (Schedule S-4): The number of billed intrastate call access minutes (column (g)) divided by the number of intrastate calls (column (f)) should approximate twice your average call holding time. If this is not true, or if the above ratio is more than 16 minutes, check columns (g) and (f). Zero or missing data could be causing this. Make sure that originating and terminating access minutes have been included. ATTACHMENT B The clarification and corrections to Form M Schedules appear below. Schedule B-5b, Analysis of Entries in Accumulated Depreciation (Account 3100) Dollar signs are placed in columns (i), (j), (k), (l), and (m) on line 32. Schedule B-6a, Analysis of Entries in Property Held for Future Telecommunications Use (Account 2002) A dollar sign is removed from column (b) on line 1. Schedule I-5b, Prepaid Taxes and Tax Accruals (Accounts 1300, 4070 and 4080) Dollar signs are placed in columns (h) and (i) on line 1. Schedule I-6, Advertising A dollar sign is placed in column (b) on line 8. Schedule I-10, Analysis of Dividend and Interest Income The letter heading in column (d) is centered. Schedule S-1, Outside Plant Statistics Corrected heading in column (q) reads as follows: Fiber Miles Equipped with Electronics (Lit) Corrected heading in column (r) reads as follows: Total Fiber Miles Deployed (Lit and Dark) Corrected caption overriding columns (z), (aa) and (bb) reads as follows: Total Equipped Channel Miles (Cable and Microwave Systems) Schedule S-2, Access Lines in Service By Technology The corrected title to Schedule S-2 reads as follows: SWITCHED ACCESS LINES IN SERVICE BY TECHNOLOGY Schedule S-4, Telephone Calls Corrected caption overriding columns (h) and (i) reads as follows: Total Interlata Toll Calls Corrected columns (e), (g) and (i) read as follows: (e): Billed Access Minutes (g): Billed Access Minutes (i): Billed Access Minutes Schedule S-6, Overseas Telephone and Related Services A dollar sign in column (c) is moved from line 2 to line 1.