ACCC issues guidelines for financial reporting by telco firms

The Australian Competition and Consumer Commission has today issued for comment the report, Record Keeping Rules for the Telecommunications Industry, which sets out new financial reporting requirements to apply in the telecommunications industry.

"The new reporting and information rules will strengthen the ACCC's ability to investigate anti-competitive behaviour and determine appropriate access prices," ACCC Chairman, Professor Allan Fels, said today. "The reports will generate detailed financial information for key retail and wholesale services. This information provides a starting point for the ACCC to analyse service costs and profitability. Allocation rules will also force consistent costings of different services and help detect potential pricing practices which may raise competitive concerns."

The report, which was prepared with the assistance of Arthur Anderson, details a recommended reporting structure and key processes for capturing financial information. This includes: A comprehensive reporting architecture specifying the services which telecommunications carriers may be required to report against, including the separate reporting of wholesale (internal and external) and retail services. Details of the information to be provided for each service, particularly the revenues, costs and capital associated with each service. This includes a detailed description of the financial statements required for each service, as well as a number of supplementary reports. Principles to be applied by carriers in developing detailed allocation methodologies in compliance with the record keeping requirements.

The ACCC is seeking comment from interested parties on the appropriateness and relevance of the requirements set out in the report. In addition the ACCC also seeks comment on a number of issues relevant to these draft rules, specifically application of the rules to specific carriers and carriage service providers and the inclusion of financial information by related entities.

Copies of the reports titled "Record Keeping Rules for the Telecommunications Industry" and "Audit and Compliance Framework for Revised Record Keeping Rules" are available on the ACCC website at or by contacting Mr Chris Pattas at the ACCC on (03) 9290 1858. The closing date for comment is by 9 July 1999.