Sec. 665.4. Revenue recognition

(a) Credits shall be made to the appropriate revenue accounts when such revenue is actually earned. When the billing cycle encompasses more than one accounting period, adjustments are necessary to properly recognize the revenue applicable to the current accounting period under report. Revenues recorded under the terms of two-tier contracts or other variable payment plans should be deferred, if necessary, and recognized ratably with expenses over the term of the related contract. Any amounts deferred shall be credited to account 4360, Other Deferred Credits.

(b) Known amounts of revenue losses due to fire or theft shall be recognized as an operating expense (Note account 5264, Other Incidental Regulated Revenue and account 6728, Other General and Administrative).

(c) Telecommunications service supplied to municipalities without charge, in accordance with franchise requirements, shall be accounted for as provided in account 2690, Intangibles. (Note also account 6564, Amortization Expense—Intangibles and account 6728, Other General and Administrative.)