How to calculate eligible revenue reporting
Under the Eligible Revenue Determination 2015 (ER Determination), the steps involved in calculating initial sales revenue, gross telecommunications sales revenue or eligible revenue are as follows:
Initial sales revenue
Less – non-telecommunications sales revenue
Plus – other telecommunications sales revenue
Less – revenue earned while not the holder of a carrier licence
Equals – gross telecommunications sales revenue
Less – deductions:
- revenue from overseas activities
- revenue from acts in Australia for services outside Australia
- revenue from rent, sell, install, insure, repair or maintain customer equipment
- revenue from content services
- revenue from exempt base station
- revenue from install or maintain telecommunications infrastructure or revenue earned from management of these activities
- inter-person input payments
- other input amount.
Equals: net telecommunications sales revenue
Equals: eligible revenue of participating person. (If there is more than one participating person within the group and accounting has been done on a group basis, eligible revenue is allocated to all participating persons within the group.)
A carrier’s initial sales or gross telecommunications sales revenue may be equal to or more than AUD $25 million for the eligible revenue period. However, its eligible revenue for the eligible revenue period may be less than AUD $25 million.
If a carrier has completed the eligible revenue calculation and its initial sales revenue, gross telecommunications sales revenue or eligible revenue was less than AUD $25 million for the eligible revenue period (calculated on a group basis where relevant), the carrier is considered to be a non-participating person. They must provide us with an eligible statutory declaration (ESD) by 31 October. It must declare its initial sales revenue, gross telecommunications sales revenue or eligible revenue for the eligible revenue period was less than AUD $25 million.
Frequently asked questions
How can a carrier determine if its initial sales revenue, gross telecommunications sales revenue or eligible revenue is less than AUD $25 million?
Initial sales revenue
Initial sales revenue for an eligible revenue period is to be calculated in accordance with section 15 of the ER Determination. The sources mentioned in section 12 of the ER Determination should be used to work out the entity’s sales revenue for the eligible revenue period. The sources of sales revenue of a licensed telecommunications carrier should be in accordance with the annual audited consolidated financial statements of the ultimate Australian parent entity. If the sales revenue is not included in the annual consolidated financial statements of the ultimate Australian parent entity, section 12 of the ER Determination sets out the sources that should be used to calculate the carrier’s sales revenue.
Gross telecommunications sales revenue
Gross telecommunications sales revenue for an eligible revenue period is calculated in accordance with Part 3 of the ER Determination. The summary of eligible revenue calculation shows the steps involved in calculating the gross telecommunications sales revenue. Gross telecommunications sales revenue of declared and consolidated related parties is to be included.
Eligible revenue for an eligible revenue period is to be calculated in accordance with Part 5 of the ER Determination and is worked out after the participating person has worked out its net telecommunications sales revenue for the period in accordance with Part 4 of the ER Determination.
Different provisions of Part 5 apply to the calculation of eligible revenue depending on whether the net telecommunications sales revenue of 2 or more participating persons has been worked out on a group basis (section 36) or if the participating person’s net telecommunications sales revenue has been accounted for independently of any other participating person (section 37).
What does it mean to be a part of a group, and who are 'related parties' for the purposes of eligible revenue reporting?
Subsection 4(4) of the Telecommunications (Participating Persons) Determination 2015 (Participating Persons Determination) provides that if a person has the same ultimate Australian parent entity as one or more other licensed telecommunications carriers, then, for the purposes of calculating initial sales revenue, gross telecommunications sales revenue, or eligible revenue, each carrier must make the relevant calculations on a group basis, accounting for revenue and deductions as a whole.
Certain revenue of related parties of participating and non-participating persons may be relevant for the calculation of eligible revenue. It is important to identify all related parties so that the revenues of those parties can be included, where required, as part of a participating person’s eligible revenue return.
What is a related party?
There are 2 types of related parties:
- consolidated related party
- declared related party.
Consolidated related party
A consolidated related party of a participating or non-participating person is defined in section 5 of the ER Determination and is an entity that is not the participating or non-participating person, the revenue of which is included in the annual consolidated financial statements of the ultimate Australian parent entity of the participating or non-participating person.
Declared related party (DRP)
A DRP of a participating person and of a non-participating person for the whole, or any part, of an eligible revenue period is defined in sections 6 and 7 of the ER Determination respectively.
Generally, a DRP is an entity that is not a carrier, a consolidated related party of a participating person, a non-participating person or a participating carriage service provider for the period for which the return is being completed, and the entity:
- is owned by a body which has company interests of more than 49% at any time during the eligible revenue period by the participating person
has telecommunications sales revenue in Australia during the eligible revenue period.
For more detailed information regarding declared related parties, please refer to Section 6, 7 and 8 of the ER Determination and the related parties for eligible revenue reporting factsheet.
Can I change the reporting period?
For most participating persons, the financial statements are likely to be for the period ending 30 June. However, some participating persons may need to use a different 12‑month period as their eligible revenue period. Subsection 12(3) of the ER Determination allows the ACMA to consider a participating person’s other financial statement period for the purposes of assessing revenue for the relevant eligible revenue period.
For example, for the 2022–23 eligible revenue period, if a participating person’s financial year ended on 31 July 2023, the most recent financial statements ending on or before 30 June 2023 should be used (that is, 31 July 2022) and lodged to support an eligible revenue submission to be submitted on 31 October 2023.
For more detailed information regarding financial reporting, please refer to the eligible revenue submission handbook:
Please contact our revenue assurance team to discuss any variation to the reporting period.
What do I do if a merger or acquisition has occurred?
If a carrier or carrier group has been a party to a merger or acquisition during the eligible revenue period, please contact our revenue assurance team to discuss your eligible revenue reporting requirements.
Can I request an extension of the due date of 31 October?
The ER Determination provides that returns are due four months after the end of the financial year, being 31 October. The legislation makes no provision for the ACMA to grant extensions to the statutory due date.
What do I do if my carrier’s contact details have changed?
It is important that your carrier’s contact details are kept up-to-date to ensure that you receive information or updates regarding eligible revenue reporting requirements.
Where can I get more information?
For further information, please refer to the eligible revenue portal.
Revenue assurance team
Phone: (02) 6219 5355