Sec.  32.23   Nonregulated activities.

   

   (a)  This  section  describes  the  accounting treatment of activities
   classified  for  accounting  purposes  as "nonregulated." Preemptively
   deregulated   activities   and   activities   (other  than  incidental
   activities)  never  subject  to  regulation  will  be  classified  for
   accounting  purposes  as  "nonregulated."  Activities that qualify for
   incidental  treatment  under  the  policies of this Commission will be
   classified for accounting purposes as regulated activities. Activities
   that  have  been  deregulated  by  a  state  will  be  classified  for
   accounting purposes as regulated activities. Activities that have been
   deregulated at the interstate level, but not preemptively deregulated,
   will  be  classified  for  accounting purposes as regulated activities
   until such time as this Commission decides otherwise. The treatment of
   nonregulated  activities  shall  differ depending on the extent of the
   common  or  joint use of assets and resources in the provision of both
   regulated and nonregulated products and services.

   (b)  When a nonregulated activity does not involve the joint or common
   use  of  assets  and  resources in the provision of both regulated and
   nonregulated  products  and services, carriers shall account for these
   activities on a separate set of books consistent with instructions set
   forth  in  Sec. Sec. 32.1406  and  32.7990.  Transfers of assets, and sales of
   products   and   services   between   the  regulated  activity  and  a
   nonregulated activity for which a separate set of books is maintained,
   shall  be  accounted  for  in  accordance  with the rules presented in
   Sec. 32.27,  Transactions  with  Affiliates. In the separate set of books,
   carriers  may  establish  whatever detail they deem appropriate beyond
   what  is  necessary  to  provide  this Commission with the information
   required in Sec. Sec. 32.1406 and 32.7990.

   (c)  When a nonregulated activity does involve the joint or common use
   of assets and resources in the provision of regulated and nonregulated
   products  and  services,  carriers  shall account for these activities
   within  accounts  prescribed  in  this  system  for  telephone company
   operations.  Assets  and  expenses  shall  be subdivided in subsidiary
   records  among  amounts  solely assignable to nonregulated activities,
   amounts solely assignable to regulated activities, and amounts related
   to  assets  and  expenses incurred jointly or in common, which will be
   allocated  between  regulated  and  nonregulated  activities. Carriers
   shall submit reports identifying regulated and nonregulated amounts in
   the   manner   and   at  the  times  prescribed  by  this  Commission.
   Nonregulated  revenue items not qualifying for incidental treatment as
   provided  in  Sec. 32.4999(l)  of this part, shall be recorded in separate
   subsidiary  record  categories of Account 5280, Nonregulated operating
   revenue.  Amounts  assigned  or  allocated  to  regulated  products or
   services shall be subject to part 36 of this chapter.

   [ 52 FR 6560 , Mar. 4, 1987, as amended at  53 FR 49322 , Dec. 7, 1988;  59 FR 46930 , Sept. 13, 1994;  64 FR 50007 , Sept. 15, 1999]