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The Telecom Regulatory Authority of India has suggested that operators should disclose revenues from each stream of business separately.
While telecom companies are already required to separately report revenue from broad service categories, TRAI now wants reports on income from services such as 3G, tower business, Internet Protocol TV and multimedia messaging. As of now, operators report revenues for broad categories such as mobile services, long distance telephony and fixed line telephone services.
TRAI said that the move to include more sub-head for revenue reporting has been taken to keep in line with changes in technology and user behaviour.
Regulatory focus
“Some services have virtually disappeared from the market while new services have emerged. Regulatory focus has also been drawn in recent times to sub-services within services, data and value-added services, necessitating the collection of more detailed information,” TRAI said while issuing the draft reporting system on accounting separation regulations 2012. Operators were given time till January 31 to send their comments.
Under the proposed regulations, operators will have to submit accounts every year. The new regulation will, however, be applicable only to those players which have consolidated revenue of over Rs 100 crore.
“A number of regulatory and policy changes have also influenced the sector. Dual technology, unified access licenses have been issued. Allocation of 2G spectrum to new players and auction of 3G spectrum have impacted business models and revenue streams of service providers,” TRAI said while justifying the move to change revenue reporting norms.
Online submission
The new regulations also allow operators to submit data online. “To obtain and use data in a timely fashion, a need has been felt for its online submission and processing thereby also reducing regulatory cost,” it said.
Accounting separation was first introduced in 2004 and the objective at that time was to monitor cross subsidisation of services. Operators were also found to be reporting higher revenues under licence categories which had lower revenue share in a bid to pay lower revenue share to the Government.
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