NTA mulls introducing new rule
KATHMANDU:
The Nepal Telecommunications Authority (NTA) is devising a new rule that will require all its licensees to submit a comprehensive financial statement each fiscal year.
The provision is basically targeted to segregate incomes of different services of telecom companies and discourage cross subsidisation.
Officials at NTA said that the audit report being submitted by telecom companies and internet service providers (ISPs) is insufficient to closely and effectively monitor the telecom sector, forecast market trend and bring policies accordingly.
They said NTA will prepare a standard format of financial statement that licensees will have to fill and submit, including financial details about income, expenditure, taxes, investments and share ownership structures for ‘illustrative purpose only’.
So far, the telecom companies who are also licence holders of ISP are submitting audit reports prepared for accounting purpose to NTA, putting the revenue generated from all services under one head.
“The new provision will make it mandatory for telecom companies to separate income of voice, data and other services,” said Purushottam Khanal, director of NTA. He added that it will basically help discourage cross subsidisation and prepare indicators of domestic telecom industry.
For example, state-owned Nepal Telecom (NT) has been making income from services, including voice, data, international long distance gateway, its investments in other sectors and bank interests. However, it shows its income only under two subjects — income from services and other incomes.
Once the new rule is implemented, it will require NT to disclose income of each service like GSM mobile, CDMA and landline and even break their income under revenue generated from local and international calls.
Similar to telecom companies, ISPs and network service providers will also have to segregate incomes based on type of the services they provide.
NTA plans to collect feedback over the proposed model of financial statement within three months and start implementation from next fiscal year. Amid changes in share ownerships from time to time and companies delaying to submit their financial details, the NTA through the new financial statement will also hold its licensees responsible in keeping updated information about their investors, with the percentage of the share the investors hold.
Source: THT
