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Accounting separation
Currently, Telekom Romania Communications S.A., as a provider with significant power in the market for fixed call termination on its own network and in the market for leased lines-terminating segments with a transmission capacity of up to (including) 2 Mbps, has the obligation to keep separate accounts for their activities in these markets. Moreover, since the date of implementing fixed termination tariffs based on a pure LRIC model (respectively 1 April 2014), the obligation to keep separate accounts for the costs in the termination market has been withdrawn and Telekom Romania Communications S.A. has the obligation to conduct cost accounting, within their internal accounting system, for the activities related to interconnection for the purpose of fixed call termination and access to its network or associated facilities. Moreover, by its President’s Decision no. 1145/2015, ANCOM withdrew the obligations corresponding to local loop access services, previously imposed on Telekom Romania Communications S.A., including the obligation to keep separate accounts.
These obligations are detailed in the Regulation on keeping separate accounts and conducting cost accounting, within the internal accounting system, by the company Telekom Romania Communications S.A. (Decision 274/2012, modified by Decision 366/2014).
Separate financial statements are concluded per financial year and published annually, within 6 months from the completion of the financial year for which they have been concluded.
Accounts must include the profit and loss account, an account of the average capital employed for each business unit and subunit, as well as the explanatory notes and the accounting policies used. Moreover, Telekom Romania Communications S.A. must account, within its separate accounts, for the costs of services provided through each business unit.
With a view to verifying compliance with the provisions and conditions imposed on Telekom Romania Communications S.A., ANCOM requires this company’s separate accounts to be audited by an auditing body featuring high quality audit.
The auditor will check whether the separate accounts reflect, under all material aspects, the data in the accounting documents and relevant financial statements of Telekom Romania Communications S.A., as well as the procedures for collecting and processing accounting information, and whether they observe the calculation and separate accounting methodology for the costs, revenues, and capital employed.
In compliance with the obligations set out by the Authority, Telekom Romania Communications S.A. has been conducting and publishing annual separate accounts starting from 2014. The documents published on the company’s own website are available here.
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