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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 In the Matter of ) ) Revision of ARMIS Quarterly Report ) (FCC Report 43-01), ARMIS USOA Report ) CC Docket No. 96-193 (FCC Report 43-02), ARMIS Joint Cost Report ) (FCC Report 43-03), ARMIS Access Report ) (FCC Report 43-04), ARMIS Quarterly Service Quality ) Report (FCC Report 43-05), ARMIS Semi-Annual ) Service Quality Report (FCC Report 43-06), ) AAD 95-91 ARMIS Infrastructure Report (FCC Report 43-07), ) and ARMIS Operating Data Report (FCC Report 43-08) ) for Certain Class A and Tier 1 Telephone Companies ) ORDER Adopted: December 17, 1996 Released: December 17, 1996 By the Chief, Accounting and Audits Division: I. INTRODUCTION AND BACKGROUND 1. In this Order, we implement the Order section of the Commission's Order and Notice of Proposed Rulemaking, Reform of Filing Requirements and Carrier Classifications, (Reporting Requirements Order) released September 12, 1996. We do not, in this Order, act on the Notice of Proposed Rulemaking section of the Reporting Requirements Order but rather defer such action to a separate proceeding. 2. In addition to implementing the Reporting Requirements Order, we also clarify definitions and row descriptions in several Automated Reporting Management Information System (ARMIS) Reports. These clarifications are implemented to provide consistency among reports and improved understanding of existing requirements. In addition, this Order compiles previously adopted ARMIS Report requirements for the convenience of report filers. While many of these requirements were adopted pursuant to previous Commission Orders, others were developed through correspondence with the industry in an effort to clarify existing procedures. 3. Other minor clarifications in this Order are adopted pursuant to authority delegated to the Bureau in paragraph 58 of the ARMIS Order and Section 0.291 of the Commission's rules. Because these changes are minor and, in most cases, made pursuant to the recommendations of the carriers filing the reports, we find for good cause that compliance with the notice and comment procedures of the Administrative Procedure Act is unnecessary. See 5 U.S.C. Section 553(b)3B. 4. Pursuant to the above authority, this Order revises or clarifies the following eight ARMIS Reports: FCC Report 43-01, the Quarterly Report, FCC Report 43-02, the USOA Report, FCC Report 43-03, the Joint Cost Report, FCC Report 43-04, the Access Report, FCC Report 43-05, the Quarterly Service Quality Report, FCC Report 43-06, the Semi-Annual Service Quality Report, FCC Report 43-07, the Infrastructure Report and FCC Report 43-08, the Operating Data Report. II. DISCUSSION A. Reporting Requirements 5. Section 402(b)(2)(B) of the Telecommunications Act of 1996 (1996 Act) requires the Commission to "permit any common carrier . . . to file cost allocation manuals and ARMIS reports annually, to the extent such carrier is required to file such manuals or reports." Rules requiring the quarterly filing of the ARMIS Quarterly Report (43-01) and ARMIS Quarterly Service Quality Report (43-05) by March 31, June 30, September 30, and December 31, and semi-annual filing of the ARMIS Semi-Annual Service Quality Report (43-06) by March 31 and September 30 of each year were superseded by Section 402(b)(2)(B). The Commission, therefore, amended its rules with the issuance of the Reporting Requirements Order. Carriers are now required to file cost and demand data (43-01) and service quality data (43-05) and (43-06) once each year. As directed by the Commission, we are, hereby, revising the form and content of the ARMIS Quarterly Report, the ARMIS Quarterly Service Quality Report and the ARMIS Semi-Annual Service Quality Report to facilitate annual filings. The reports in this revised format are renamed the ARMIS Annual Summary Report (43-01), the ARMIS Service Quality Report (43-05) and the ARMIS Customer Satisfaction Report (43-06), respectively. The filing date for all ARMIS Reports, except the ARMIS Infrastructure Report (43-07), is now on or before April 1, with the first reports due April 1, 1997. In our Reporting Requirements Order we requested comment on a proposed filing date of April 1 for the ARMIS Infrastructure Report (43-07). We received several comments on this issue and the Commission will release an Order in the near future determining the outcome of that notice. Therefore, this Order does not determine the filing date of the ARMIS Infrastructure Report. 6. Section 32.11 of the Commission's rules establishes a $100 million threshold in "annual revenues from regulated telecommunications operations" for the purpose of classifying carriers for accounting purposes. Our Part 43 rules place additional reporting requirements on carriers with operating revenues of at least $100 million. Pursuant to Section 402(c) of the 1996 Act, the Commission adopted interim rules to adjust the revenue thresholds for inflation. These revenue thresholds are based on the annual average value of the Department of Commerce Gross Domestic Product Chain-Type Price Index. 7. The Commission did not set an inflation adjusted threshold for 1996 operating revenues because the value of the inflation index for 1996 will not be available until early April 1997. Instead, the Commission stayed Part 43 reporting requirements to the extent that they are currently imposed upon carriers that will first cross the revenue threshold in 1996. This Order, therefore, applies to all carriers not subject to the Commission's stay. We adopt revisions to all ARMIS reports due on or before April 1, 1997, as well as clarify various items in ARMIS reports discussed below and summarized in Appendix A. Detailed instructions for the completion of the reports, which incorporate the changes made in this Order, are available for public inspection in the Commission's Public Reference Room at 2000 L Street, N.W., Suite 812, Washington, D.C. 20554 and from the International Transcription Service, Inc. (ITS) at 2100 M Street, N.W., Suite 140, Washington, D.C. 20037. B. General Requirements 8. The following clarifications discussed in paragraphs 9, 10 and 11 apply to all ARMIS filings. For consistency among reports and in an effort to improve understanding of the existing reporting requirements, we clarify the following general requirements: (1) use of submission numbers; (2) error check procedures; (3) errata instructions; (4) waivers; (5) extension of filing time; and (6) certification. 9. Our current rules require each ARMIS submission to contain a submission identification number. Both the automated and paper version of each ARMIS filing must contain the same number. If a revised ARMIS report is provided, both the paper and automated versions must be assigned a new submission identification number. This will ensure that the data on both reports are consistent. 10. The Commission provides carriers with "edit check programs" for each of the ARMIS reports as a tool to identify errors in data. When an error is detected, the carrier must correct the error prior to submitting the report to the Commission. Once the carrier corrects its data so that the edit check program identifies no errors, the carrier should submit the ARMIS report along with a copy of the edit check printout to the Commission verifying that the program did not identify any errors. We make this clarification to ensure that the row and column calculations are consistent with the reporting instructions. 11. When a carrier submits a corrected ARMIS report, it must provide a brief statement in the transmittal letter specifying which items were corrected. By having this information available in the transmittal letter, users will be able to identify the corrected data easily. 12. We remind carriers that waivers are not in effect until they are granted in writing by the Commission or its delegated authority. Similarly, we emphasize that requests for extensions of filing times must be made in a timely manner. Requests received less than 72 hours prior to a filing deadline are prima facie unreasonable. In addition, we remind carriers in this Order that certification of the accuracy and correctness of each report must be completed by an officer of the corporation. C. FCC Report 43-01 - The Annual Summary Report 13. FCC Report 43-01, the Annual Summary Report, formerly the Quarterly Report, is hereby revised pursuant to the Commission's directive in the Reporting Requirements Order. These revisions in both form and content will facilitate the annual collection of the results of accounting, rate base and cost allocation requirements prescribed in Parts 32, 36, 64, 65, and 69. Table I, Cost and Revenue, is revised to present information on an annual basis that has previously been reported quarterly. The form layout is revised to reduce the number of pages required by this filing. Table II, Demand Analysis, is revised to facilitate annual filing. Its previous two sections, Monthly Data - End of Quarter View and Quarterly Data, are now combined and will consist of one column, designated (bb), with the subheading "End of Year View." 14. In addition to the above revisions precipitated by the Reporting Requirements Order, the following revisions are made to various row descriptions and definitions to add clarity and provide consistency among reports. Rows 1320 through 1390 are now identified as either revenue or expense items. Row 1045, Nonregulated revenue, will be presented as a separate line item and no longer included in Row 1040, Miscellaneous revenue. 15. In addition, we make the following revisions as required by or adopted in previous Orders and in letters from the Chief of the Accounting and Audits Division. The revisions to Rows 1370 and 1780 reflect changes adopted in the AFUDC Order. The row descriptions of Row 1370, Non-operating Adjustment, and Row 1780, FCC Investment Adjustment, are revised to specify that these rows will not include any Allowance for Funds Used During Construction (AFUDC) or Telecommunications Plant Under Construction (TPUC), respectively, as a Part 65 Adjustment. Revisions to Rows 1750 and 1880 reflect the adoption of the Statement of Financial Accounting Standards (SFAS) No. 109 (1994). The definition of Row 1750, Other Deferred Charges, is revised to include Account 1437, Deferred tax regulatory asset. Row 1880, Other Jurisdictional Liabilities and Deferred Credits-Net, is revised to include Accounts 4341, Net deferred tax liability adjustments, and 4361, Deferred tax regulatory liability. Rows 1110, 1190, 1540, 1590, 1610, 1690 and 1705 are revised to reflect prior clarifications made in a letter from the Common Carrier Bureau to a representative of the United States Telephone Association (USTA) on September 11, 1990. Similarly, Rows 1920 and 1935 are revised pursuant to a letter from the Common Carrier Bureau to a representative of USTA on May 20, 1991. Table II, Row 2140 has been revised to clarify that this row is for lines subject to a special access surcharge, pursuant to Sections 69.5(c) and 69.111. We also eliminate Table III, Restated Data, because this data is no longer effective when submitted only on an annual basis. Part I of Appendix A to this Order provides a summary of all revisions to this report. D. FCC Report 43-02 - The USOA Report 16. FCC Report 43-02, the USOA Report, provides the annual operating results of the carriers' activities for every account in the Uniform System of Accounts (USOA). In this Order, we amend row descriptions and definitions to add clarity and provide consistency among reports. In Table I-1, Income Statement Accounts, Row 5280, Nonregulated, is no longer included in Row 5200, Miscellaneous, to be consistent with Part 32. We also revised the row descriptions and definitions of Row 510, Basic Local Service Revenue, and Row 520, Local Network Service Revenue, to be clear and to be consistent with the same change made in Report 43-03. In addition, we clarify the description of Row 730. It now reads "Income Before Other Operating Items and Taxes." This Order further clarifies the definition of Row 860, Total Compensation for the Year. It now states that this amount includes payroll, including salaries, wages and payroll related benefits. Both the amounts expensed and those amounts capitalized as a component of cost of construction should be included in this row. Finally, various row descriptions in Table I-6, Special Charges, and Table I-7, Donations or Payments for Services Rendered by Persons Other Than Employees, are clarified to specify dollar amounts above which items must be reported. Part II of Appendix A of this Order provides a summary of all revisions to this report. E. FCC Report 43-03 - The Joint Cost Report 17. FCC Report 43-03, the Joint Cost Report, details the carriers' regulated and nonregulated allocations by study area pursuant to Section 64.901 of the Commission's rules. In this Order, we clarify various row descriptions and definitions to provide consistency among reports. Row 5280, Nonregulated, is no longer included in Row 5200, Miscellaneous, to be consistent with Part 32. We also revised the row descriptions and definitions of Row 510, Basic Local Service Revenue, and Row 520, Local Network Service Revenue, to clarify and to be consistent with the same change made in Report 43-02. In addition, the description of Row 530 is now "Total Operating Revenues" and is consistent with the description of Row 530 of FCC Report 43-02, Table I-1. We also added a new row entitled "Total Operating Expenses" (Row 720) to be consistent with FCC Report 43-02, Table I-1. Finally, the definitions of Rows 7200, 7300, 7600 and 750 are revised to clarify the instructions for their calculation. Part III of Appendix A of this Order provides a summary of all revisions to this report. F. FCC Report 43-04 - The Access Report 18. FCC Report 43-04, the Access Report, provides jurisdictional separations and access charge data by Part 36 category at the study area level. In this Order, we expand row titles to provide more meaningful descriptions. We also clarify various row definitions to provide consistency among reports. The General Instructions are expanded to include symbols to be used to differentiate whole dollars, dollars reported in thousands, percentages and other units (e.g., minutes, miles, conversational minutes, working loops, etc.). 19. We also make the following revisions as required by or adopted in previous Orders and letters from the Chief of the Accounting and Audits Division. Rounding conventions are included to reflect prior clarifications made in a letter from the Common Carrier Bureau to a representative of USTA on July 10, 1992. In addition, the N/As are removed from Column (r) for Rows 3070 and 3071 to reflect prior revisions made in a letter from the Common Carrier Bureau to a representative of USTA on March 26, 1992. The descriptions of Row 2250, FCC Investment Adjustment, and Row 7350, FCC Expense Adjustment, are clarified to state that these rows will not include any TPUC or AFUDC, respectively, as a Part 65 Adjustment. These clarifications reflect changes made in the AFUDC Order. Row 8042, Rate of Return, and Row 8045, Rate of Return Including FCC Refund, are revised pursuant to the LEC Price Cap Order. Row 8021, Approximate Net Taxable Income, has been revised to clarify its calculation. Row 9010, Total Billable Access Lines, has been revised to be consistent with FCC Report 43-01, Table II, Row 2140. Part IV of Appendix A of this Order provides a summary of all revisions to this report. G. FCC Report 43-05 - The Service Quality Report 20. FCC Report 43-05, the Service Quality Report, provides service quality information in the areas of interexchange access service installation and repair intervals, local service installation and repair intervals, trunk blockage and total switch downtime for price cap companies. All tables have been revised pursuant to Commission directive in the Reporting Requirements Order to facilitate reporting on an annual basis. Table III is now "Common Trunk Blockage" and consists of one column, designated (ak), for annual data. Rows 180, 181, and 185 through 190 are revised to facilitate annual reporting. The rows in Table IV.A are expanded for collection of annual data. The column designators in Table I, Installation and Repair Intervals (Interexchange Access), Table II, Installation and Repair Intervals (Local Service), Table IV, Total Switch Downtime, and Table V, Service Quality Complaints, are revised to distinguish quarterly data from annual data. 21. In addition to the above revisions precipitated by the Reporting Requirements Order, the following revisions are made to clarify the filing instructions. The General Instructions for Table I, Installation and Repair Intervals (Interexchange Access), are revised to include procedures for summarizing data which contain percentages and averages. The definitions of Columns (af), (ai) and (aj) of Table II, Installation and Repair Intervals (Local Service), are also revised. Table IV, Total Switch Downtime, will maintain the current row and column definitions with the exception of Column (ao), Number of Switches Having Downtime, which is revised to include language to clarify the reporting of switches with multiple incidents of outage. Table IV.A, Occurrences of Two Minutes or More Duration Downtime, will provide additional instructions stating that no summaries are to be provided for this table because the purpose of this table is to provide information on individual incidents. Table V, Service Quality Complaints, is also revised and now includes language specifying that the data on Rows 320 and 330 should agree with data reported on Row 140, Table II. Part V of Appendix A of this Order provides a summary of all revisions to this report. H. FCC Report 43-06 - The Customer Satisfaction Report 22. FCC Report 43-06, the Customer Satisfaction Report, formerly the Semi-Annual Service Quality Report, reflects the results of customer satisfaction surveys conducted by individual carriers and is hereby revised pursuant to the Reporting Requirements Order to facilitate the collection of data on an annual basis. The column designators are revised to distinguish semi-annual data from annual data. Table II, Dial Tone Response and Transmission Quality, is now eliminated. Part VI of Appendix A of this Order provides a summary of all revisions to this report. I. FCC Report 43-07 - The Infrastructure Report 23. FCC Report 43-07, the Infrastructure Report, provides switch deployment and capabilities data. In this Order, various rows of Table I, Switching Equipment, are revised to correct minor typographical errors. In addition, for clarification purposes, Table IV, Additions and Book Costs, Row 0540 is now renamed "Total TPIS Gross Additions (000)." Part VII of Appendix A of this Order provides a summary of all revisions to this report. J. FCC Report 43-08 - The Operating Data Report 24. FCC Report 43-08, the Operating Data Report, provides network operating data in a consistent format and is essential for monitoring network growth, usage and reliability. In this Order, the only clarifications made to this report are the clarifications we made to the general requirements in the Reporting Procedures section of this report. As we noted in Section B of this Order, these clarifications are necessary to maintain consistency among all ARMIS reports. III. PAPERWORK REDUCTION ACT 25. The modifications to the information collections contained herein are contingent upon approval of the Office of Management and Budget. IV. ORDERING CLAUSE 26. Accordingly, IT IS ORDERED, pursuant to the authority contained in Sections 1, 4(i), 4(j), 201-205, 215, 218, 219, and 220 of the Communications Act of 1934, as amended, 47 U.S.C.  151, 154(i), 154(j), 201-205, 215, 218, 219, and 220, and Sections 0.91 and 0.291 of the Commission's rules, 47 C.F.R.  0.291, that, FCC Report 43-01, the Annual Summary Report, FCC Report 43-02, the USOA Report, FCC Report 43-03, the Joint Cost Report, FCC Report 43-04, the Access Report, FCC Report 43-05, the Service Quality Report, FCC Report 43-06, the Customer Satisfaction Report, FCC Report 43-07, the Infrastructure Report, and FCC 43-08, the Operating Data Report, ARE REVISED, as set forth above and in the Appendix to this Order, effective for filings due April 1, 1997 and, in the absence of modification, thereafter. FEDERAL COMMUNICATIONS COMMISSION Kenneth P. Moran Chief, Accounting and Audits Division Attachment