Chapter 7 CDR-ACCOUNTING MANUAL - Bharat Sanchar Nigam...

E3- E4 CHAPTER 7 -- CDR ACCOUNTING MANUAL Rev Date 31.3.2016

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Chapter 7 CDR-ACCOUNTING MANUAL


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Contents Page No.

1. Introduction to Accounting 3

2. Accounting Scope 4

3. Process Flow 6 4. Chart of Accounts 8

5. Accounting for Invoices and Related Payments 13 a. Invoice Generation and Complete Payment in the same SSA 14 b. Excess/Double Payments when payment is made in the Billing SSA 16

c. Partial Payments made in the Billing SSA 19 d. Remittance to different SSA, Same Circle (Complete payment) 22 e. Remittance to SSA of Same Circle (Partial Payment) 24

f. Remittance to different SSA of same Circle (Excess Payment) 28 g. Remittance to SSA of different Circle (Full Payment) 29 h. Surcharge on delayed payments (Late fee) 30

6. Accounting for GSM Collections 30 a. GSM Invoice of one Circle, Payment in SSA of same Circle 30

b. GSM Invoice of one Circle, Payment in SSA of different Circle 31

7. Adjustments 32

a. Debit Voucher b. Credit Voucher 34 c. Cancellation of Invoice 36

d. Write off of Bad Debts 36 e. Collection against Write off 37

8. Payments from Various Channels 38 a. Payments on CSR counter 38 b. Payments from Post Offices 39

c. Payments from Banks 40 d. Payments through ECS 42

e. Payments through Bill-desk f. Payments involving units outside the CDR system(ERU) 44

9. Cheque Dishonour Scenario 49

10. Missing Daily Lists Scenario (Unadjusted Credits) 53 11. Reconciliation of channel payments 54 12. Accounting for sale of Pre-paid Cards/Modem through PMS counters 54 13. Accounting for Advance Payments 55

14. Period End Closing Activities 56

a. Income Received in Advance 56

b. Accrued Income 57

c. Interest on Deposits 57 d. Accrued Interest on Deposit 58

15. Refund 61 16. Accounting treatment for OYT rebate in CDR System 63 17. Implementing Bundled PC EMI solution in the CDR system 64

18. Migration Strategy 66 19. Revised Strategy for Financial data/Delta payment Migration 69 20. Journal entries for migrated financial data 89

21. Handling third party vendor payments collected through CDR invoices 96 22. Accounting for Zonal Electronic Stapling(ES) 99 23. Handling of ES discount in CDR Accounting 104

24. Account Settlement procedure 105 25. Accounting module-Oracle applications-Operation guidance 108 26. Accounting for amended Service Tax Rules -Point of Taxation 113


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List of Figures Page No.

Figure 1: Process flow for Accounting 3

Figure 2: Billing and complete payment in the same SSA 15

Figure 3: Excess or double payment in the same SSA 16

Figure 4: Excess or Double Payment Adjustment in the next invoice 18

Figure 5: Refund of Excess or Double Payment 19

Figure 6: Refund for closed/surrendered connections 19

Figure 7: Partial payment made in billing SSA 20

Figure 8: Partial Payment adjustment in next cycle 21

Figure 9: Remittance to different SSA in same circle 23

Figure 10: Remittance to different SSA in same Circle (Partial Payment) 25

Figure 11: Remittance to different SSA in same Circle

(Partial Payment Adjustment) 27

Figure 12: Remittance to different SSA in same circle (excess payment) 28

Figure 13: Remittance to an SSA in different circle (full payment) 29

Figure 14: Surcharge on delayed payments(Late fee) 30

Figure 15: Accounting for GSM Collections: Payment in SSA of same Circle 30

Figure 16: Accounting for GSM Collections: Payment in SSA of diff. Circle 31

Figure 17: Debit Voucher: Settlement of short billed invoice 33

Figure 18: Accounting for debit voucher (Settlement of short billed invoice)

on generation of next invoice 34

Figure 19: Accounting for Credit Voucher where the bill is fully settled 35

Figure 20: Accounting for Credit Voucher on Gen eration of new Invoice 36

Figure 21: Accounting for Write Off of Bad Debts 37

Figure 22: Accounting Entry on Billing 38

Figure 23: Accounting entry on receipt of daily list 38

Figure 24: Accounting entry on receipt of TRC Schedule and Cheque 38 Figure 25: Accounting entry on receipt of daily list from Head Post Office 39

Figure 26: Accounting entry on receipt of TRC Schedule, Cheque from HPO 40 Figure 27: Accounting entry on receipt of payment information from Billing 40

Figure 28: Accounting treatment for Discount on ECS 41

Figure 29: Accounting entry for Missing Daily list 53


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1. Introduction to CDR Accounting

The integrated accounting has been implemented for the first time in BSNL through the CDR based

Operation Support System/Business Support System(OSS/BSS). The whole accounting process is

automated and taken care of by the system with hardly any user intervention. Accounting is done in

the CDR system based on actual details.

The main sources of information for Accounting , at present, are:

Zonal Billing System

Zonal Payment Management System

The accuracy and timeliness of data in accounting system depends on data from the above systems:

Following figure is a representation of the various systems that interact with the Accounting system.

Figure:1 Process flow for Accounting

The basic flow within a zone is captured as:

1. Invoices are generated in CDR

2. The billing data is transferred to PMS for receiving payment

3. GL Code based information on billing data from CDR system is sent to the

Accounting system for doing credit posting to Revenue A/cs with corresponding debit

posting to the relevant Sundry Debtors and receivable accounts.

4. Invoices are settled through approved payment channels which operate in offline and

online modes.

5. Each channel operates based on a hierarchical structure of Collection Desk (CD) and

Collection Center (CC).

6. Collection Centre (or Collection Desk) sends payment data directly in the form of daily

lists to be entered into the PMS. Collection Center does the monetary settlement with

BSNL through PMS.

7. PMS sends daily feed to Accounting - “receiving_SSA” and “Collection_Center” wise .

Zonal PMS

Zonal Billing System

Zonal

Accounting

System

External Financial System


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Based on this ,the Accounting will debit to one of the following accounts:

(i) Claims Recoverable from DoP

(ii) Claims Recoverable from WSC

(iii) Claims Recoverable from Banks

(iv) Claims recoverable from AO (Cash)

(v) Claims recoverable from State Govt IT(E-seva)

(vi) Claims recoverable from EAU(Portal)

(vii) Claims Recoverable from Others etc.

with corresponding credit to “CDR TR Collections account”.

Money from the Collection Center will be received at the prescribed frequency and managed

by AO Cash simultaneously.

8. When money received is entered into the PMS (based on Schedule) and the

information transferred to the accounting system the entry will be to Credit „collection

center (Claims Recoverable from HPO/Banks/AO Cash/Others/Bill Desk etc)‟ and

Debit „TRC Settlement account’ operated within the CDR accounting system

9. PMS sends collection information to the home billing system in the form of lockbox

files in the required format.

10. When CDR billing system does the posting of these payments, it sends the GL Code

based payment information to the accounting system. Accounting system does the

posting of this by debiting „TR Collection Account „ and crediting the relevant „Sundry

Debtors and relevant Tax Recoverable heads ‟ created based on billing data.

Relevant Remittance Accounts will be used in case Receiving and Owning SSA are different

and also when collections belong to external systems like GSM.

2.Accounting Scope

The objective of CDR Accounting is to implement accrual accounting at a consolidated level.

Scope for Accounting:

o Landline and Broadband: Revenue accounting

o GSM: Payment to be collected by zonal PMS, Remittance to be passed to GSM at

circle level.

o Leased Circuits: Payment to be collected by zonal PMS and accounting to be carried

out in EFS (External Financial System) with necessary Journal entry.

o Revenue accounting is to be done based on the feeds from PMS & CDR Billing only

and no other interface is in the scope of accounting at present.


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o Accounting system can confirm the consolidated amount received at SSA level and

not at individual transaction level. Reconciliation with individual customer account

(which is maintained at Billing system) is not in accounting scope as only

consolidated entries are done based on feed received from other systems and break

up of these entries are available in the base systems (for payments in PMS and for

cleared and outstanding amount in Billing system). Reconciliation shall be carried out

manually by comparing the accounting output of GL extract and a report from Billing

system.

o Debtors are maintained at consolidated level in Accounting and individual customer

accounts are maintained in relevant billing systems.

o Debtors control account is based on service types eg. Landline and Broadband.

Reporting scope (feed for External Financial System)

o GL Extract (SSA Level; for all accounts in the system)

o Trial Balance (SSA Level)

In the existing system of accounting where SSA is the basic accounting unit, any financial

transaction done by one SSA that affects the accounts of another SSA will be settled

through the operation of “Remittance” heads. The idea of maintaining these heads is that

while no physical exchange of money will take place, the impact of the transaction will be

incorporated into the books of accounts of the SSAs involved. For this purpose, the

following Remittance heads are used

o Remittance same circle (O) and (R)

o Remittance between circles <Circle name> (O) and (R)

Further Remittance heads are used for parking payments received by PMS related to

invoices generated by GSM etc.

Fiscal Year:

o Fiscal year shall be from 1st April to 31st March.

Currency:

o Reporting currency needs to be INR.

o Billing currency for retail customers has to be INR.

It is necessary to keep the accounts of each month open for a sufficient period in the next

month to ensure that all the transactions are entered into the system. In the existing

systems the TR Accounts for the previous month are open until the 25th of the next

month ie upto generation of SLR reports . In the CDR system also it is proposed to close

the accounts by 15th of next month from now onwards.


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3. Process Flow

With reference to Figure 1:

Flow from Billing to Accounting:

o Information required Per Billing Cycle:

GL Code wise billed amount of revenue/adjustments for revenue owning

SSAs in each circle, consolidated SSA wise.

Discounts: As they will be adjusted against amount outstanding as a part of

invoice information, posting in accounting to be done GL Code wise like

normal revenue items during bill cycle run with additional line item in invoice.

Excess/Double Payments: For all SSAs in each circle when adjusted in

subsequent invoice. Accounting will capture this as an additional line item

based on the consolidated GL code wise feed received from Billing system.

Adjustment entries for deposits and interest on deposit will be passed based

on the consolidated feed from billing system. The logic for interest and

principal amount break up is to be maintained at billing system level.

Refunds: As and when refund of deposit is due, refund of double/excess

payment and refund on closed/surrendered connections

Either as an adjustment in next invoice

Or refund is given in the form of a cheque

o Information required Daily

Clearing information in order to clear amount outstanding including both

revenue receiving and revenue owning SSA, consolidated based on Owning

and Receiving SSA is received from Billing at end of day.

Adjustments

Debit Voucher information for all SSAs in each circle.

Credit Voucher information for all SSAs in each circle.

Consolidated feed for Interest on deposit for all SSAs in each circle based on

type of deposit to be posted for provisioned connections based on GL Codes.

o Write-offs:

Write offs are manually done in Billing and posted to Accounting on periodic

basis.

Reversal of write-offs not supported

Collections against write-off, if any, will go to „Other Income‟. Posting to be

done by PMS to Accounting.


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o At year end, consolidated feed for Interest accrued on interest bearing deposits for all

SSAs in each circle based on type of deposit to be posted for unprovisioned new

connections(prospects) and additional services for existing customers.

o At end of financial year or quarterly as desired, feed file on Accrued Income: Unbilled

revenue items (Earned but not billed) grouped SSA wise upto last day of every

month.

o At end of financial year or quarterly as desired, feed file on Advance Income: eg. Rent

(Billed but unearned) grouped SSA wise, revenue unearned and unbilled grouped

SSA wise

Flow from Payment Management System to Accounting:

o Daily Basis

Payment information combined SSA wise:

Revenue Receiving SSA

Revenue Owning SSA

Collection Centre: Details of payment received from Head Post

offices, Banks, AOCash, Bill Desk etc.

Information about the bounced cheques both Retail cheques and settlement

cheques

Deposit information

For all SSAs in each circle, payment received in the form of deposits.

This information need not be identified as deposits. This identification

will be done by the Billing system

o Periodic Basis (mainly by AO Cash)

Information when schedule is received for Billing System

Consolidated information on amount received.

Collection centre (HPO, Bill Desk etc)

Revenue Receiving SSA

Flow from Accounting to External Financial System

o At period closing, a report containing GL Balances will be generated containing GL

Code, GL Account name, Closing Balance, SSA, Circle.

o An SSA wise trial balance will be obtained.


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4. Chart of Accounts:

Following are some important G/L codes introduced for and operated in CDR system:

Allotment of account codes under Current Assets Schedule 113 (Basic segment)

Minor account code:

Detailed suspense account codes

1132300 – „CDR based TRC claims recoverable‟

is allotted

1132301 – „CDR based TRC Claim from DOP‟ 1132302 – „CDR based TRC Claim from Bill desk‟

1132303 – „CDR based TRC Claim from Banks‟ 1132304 – „CDR based TRC Claim from Cash counter of BSNL‟ 1132305 – „CDR based TRC Claim from State Govt. IT solution

channels‟ 1132306 - CDR based TRC claims recoverable from EAU

1132399 – „CDR based TRC Claim from others‟

The following existing account codeswill be utilized for booking of the claims, which are not

pertaining to CDR based TRC claims .

1130805 – Claims recoverable from DOP 1130813 – Claims recoverable from Bill Desk 1130816 – Claims recoverable from Bank

1130899 – Others

Minor account code: Detailed suspense account codes 1131000 – „Revenue Accrued‟

1131025 – „CDR based Debit Memo Invoicing‟

1132400 – „Settlement of CDR based transactions

with CMTS‟

1132401 – „CDR based claims for bill collection charges recoverable from CMTS‟

1132402 – „CDR based claims for share of discount on post-paid bills recoverable.

Allotment of account codes under Current Liability Schedule 119

Minor account code:


1194500 – „CDR based

TR settlement / adjustment Account‟

1194501 – „CDR based TRC Settlement Account‟

1194502 – „CDR based TR Collection Account‟ 1194503 – „CDR based Unallocated TR Collection Account‟ 1194504 – „CDR based Credit Memo Invoicing Account‟

1194505 - CDR based third party system TR collection Account 1194506 - CDR based ATC settlement Account

1194600 – „Settlement of

CDR based transactions with CMTS‟

1194601– CDR based claims payable to CMTS for post-paid account‟ 1194602 – CDR based claims payable to CMTS for pre-paid account „

Allotment of account codes under Schedule 419 in CMTS segment:

Minor account code:


4193500 – „Settlement of CDR based transactions with Basic‟

4193501 – „CDR based claims payable to Basic for bill collection charges‟ 4193502 – „CDR based claims payable to Basic for share of

discount on post-paid bills‟


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1132401-CDR Based Claims for bill collection charges recoverable from CMTS:

With the introduction of PMS, all restrictions on CMTS bill payments get lifted. CMTS bills can be paid

at all payment points accepting Land Line payments. The collection channels are not required to

separate out the CMTS payments. It will remain mixed with the LL payments. Similarly the schedules

also will be common. That is the collection channels will give a single statement along with the

settlement cheque. The commission on collection will be deducted in advance or paid later by

the Basic segment even in relation to CMTS Bills. When we have to do Segment Based accounting,

the bill collection charges that Basic segment has paid for collecting Mobile bills will have to be

reimbursed to the Basic segment by the Mobile Segment. In fact even for online acceptance of mobile

bills, the Basic segment should claim a bill collection charges from the Mobile segment.

While in the first instance, the collection charges will be paid by the Basic segment, it will compute the

portion to be borne by the CMTS segment based on a report on channel-wise CMTS bill collection

details to be taken from the PMS.

When bill collection charges are paid by Basic segment, the following entries are passed in basic

segment books. These are passed at the PMS if commission is configured there as for Post Office

or passed manually in the Cash Book when a separate claim for it is received from the channel.

A. PMS dealing with/recognizing the bill collection charges: a. Collection charges are deducted and settlement is only for the net amount (Post Office) Bill Collection Charges (substitute actual GL code) Dr.

To Claims Recoverable from <Channel>

b. When collection charges are computed by PMS although the channel makes a full settlement.

Collection Charges will be paid separately by AO (Cash)

Bill Collection Charges (Substitute actual GL code) Dr.

To TRC Settlement Account

When payment is actually made by the AO (Cash) to the channel

TRC Settlement Account Dr

To Bank/Cash

It may be noted that for all transactions passing through the CDR system, AO (Cash) will operate

only TRC Settlement Account.

2. Bill collection charges settled outside the CDR system.

Bill Collection Charges (Substitute actual GL code) Dr.

To Bank/Cash


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In both the above cases another MANUAL Journal Entry will be passed in the EFS as follows: 1132401 'CDR Based Claims for bill collection charges recoverable from CMTS' Dr. To Bill Collection Charges (Substitute actual GL code) Cr. A corresponding entry will be passed in the CMTS Segment books to settle this (Exact GL codes to be taken from the GL code list) Bill collection charges Dr

To 4193501 Caims for bill collection charges Payable to Basic Segment 1132402-CDR Based Claims for share of discount on post-paid bills recoverable from CMTS: This is to deal with discounts given in the ES bills which include bills generated in the CMTS System.

The discounts are given on the total ES bill by the Basic Segment. The above GL Code will be used

to deal with that part of the discount to be borne by the CMTS system on account of discounts

allowed to its bills.

Allotment of account codes under Schedule 413 in CMTS segment:

Minor account code:


4132000 – „Settlement of CDR based transaction

with Basic‟.

4132001 – „CDR based claims recoverable from Basic for post-paid account‟

4132002 – „CDR based claims recoverable from Basic for pre-

paid account „


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CDR based TR Remittance Heads –Different circle

Minor account code-

1990900 – „CDR based TR Remittance – Different circle (Originating)‟

1991000 - „CDR based TR Remittance – Different circle (Responding)

Detailed account code

CDR based TR Remittance – Different circle(Originating)

CDR based TR Remittance – Different circle (Responding)

Name of Circle Assam 1990902 1991002

Calcutta Phones 1990903 1991003

Chennai Phones 1990904 1991004

Andhra 1990905 1991005

Bihar 1990906 1991006

Gujrat 1990907 1991007

J & K 1990908 1991008

Karnataka 1990909 1991009

Kerala 1990910 1991010

Madhya Pradesh 1990911 1991011

Maharastra 1990912 1991012

NE I 1990913 1991013

Punjab 1990914 1991014

Orissa 1990915 1991015

Rajasthan 1990916 1991016

Tamil Nadu 1990917 1991017

UP (East) 1990918 1991018

UP (west) 1990919 1991019

West Bengal 1990920 1991020

Haryana 1990921 1991021

Himachal 1990922 1991022

Andaman & Nicobar 1990943 1991043

Chattisgarh 1990950 1991050

Jharkand 1990951 1991051

Uttaranchal 1990952 1991052

NE II 1990953 1991053

CDR based TR Remittance Heads –Same circle

Minor account code-

1991100 – „CDR based TR Remittance – Same circle (Originating)‟

1991200 - „CDR based TR Remittance – Same circle (Responding)‟

Detailed account code


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Above remittance heads must not be utilized by any Circle for book transfer of any kind of inter-circle

and intra-circle transactions other than those for TR transactions (revenue and expense) exclusively

generated by CDR based billing system.

Allotment of account codes for Post coneection deposits:

Minor account code:


1132500 – „Post connection deposits recoverable‟

1132501 – Security deposit recoverable 1132502 – Security Deposit (broadband) recoverable 1132503 – STD PT Deposit recoverable 1132504 – Other deposit recoverable

1194700 – „Post connection deposits under recovery‟

1194701 – Security deposit under recovery 1194702 – Security Deposit (broadband) under recovery 1194703 – STD PT Deposit under recovery 1194704 – Other deposit under recovery

The above detailed account codes will be utilized only by CDR Based billing system at the time of

raising invoice for post-connection deposit, collection of such post connection deposits as per invoice

and to transfer of such post connection deposits to final account codes related to different types of

post connection deposits. The above mentioned account codes will not be utilized for any purpose

other than the invoicing, recovery and accounting to final account code of post connection deposits,

through CDR based billing system.

The CDR based billing system must ensure that at the end of each accounting period and particularly

at the end of the financial year the balance under each detailed account code of minor account code

1132500 are equal to the balance of corresponding detailed account code of minor account code

1194700.

The business process rules as per CDR based billing system, must ensure that the claims raised

against the existing subscribers for additional deposits / new type deposits and accounted by CDR

based billing system under the account codes mentioned above for post connection deposits are

settled within a pre-fixed time frame and no claim raised and accounted under account codes of

1132500 and 1194700 can remain unsettled beyond the said pre-fixed time frame and CDR based

billing system must neutralize such unsettled claims immediately after the expiry of the said pre-fixed

time frame, by passing accounting entries affecting the account code of 1132500 and corresponding

account code of 1194700.

The above account codes must not be utilized for accounting the transactions meant for

collections of pre-connection deposits if any, from the prospective customers.

Since CDR based billing system is account based billing and not invoice based billing the post

connection deposits shall be account based. Therefore, various types of post connection deposits in

respect of Basic Segment may be accounted under the following account codes only:

1192701 – OYT Deposits

1192705 – Tatkal Deposits

1192710 – Deposits from STDPT Franchisees

1192712 – Security Deposits for Broadband services


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1192714 – Security Deposits

1192799 - Others

The various types of deposits which are reflected under 1192702, 1192703, 1192704, 1192706,

1192707, 1192708, 1192709, 1192711,1192713 are transferred to account codes1192714 / 1192799.

However, in such cases the CDR based billing system shall keep separate information internally

about each nature of post connection deposits, which will be clubbed and booked to account code

1192714 / 1192799.

For the purpose of transferring various type of deposits reflected under 1192702, 1192703, 1192704,

1192706, 1192707, 1192708, 1192709, 1192711 & 1192713 by CDR based billing system to

account code 1192714 / 1192799 all concerned circles must reconcile the GL balance under the

account codes 1192702, 1192703, 1192704, 1192706, 1192707, 1192708, 1192709, 1192711,

1192713 with the sub-ledger / subsidiary records details and pass on the correct information i.e.

reconciled full details of such balances to CDR based billing system.

The claims / demand notes for pre-connection deposits to be recovered from prospective customers

shall be taken care of by the CDR based billing system internally and such claims / demand notes

shall not be reflected in the external financial system till such claims / demand notes are paid by the

prospective customers and after that it should be booked in the relevant account codes .

Allotment of account codes for Refunds:

Minor account code:


1193000 – „Refund due to Telephone Subscribers‟

1193001- Refund on excess/double payments(existing) 1193002- Refund due on closed connections. (existing) 1193003 – „Refunds due on working connections‟ (new) 1193004 – „Refunds due on pre-connection deposits and advances‟ (new)

The above-mentioned account codes will be utilized by CDR based billing system for keeping the

liability towards the (a) refund due on working connections and (b) refund due on pre-connection

deposits & advances. The amount of liability towards refund booked to above-mentioned account

codes will be cleared by way of adjustment or otherwise as per sanction issued by the competent

authority.

5. Accounting for Invoices and Related Payments

All financial data originating in billing are being posted in accounting. In addition, in order to comply

with Indian Accounting Standards, manual entries are also posted in accounting especially at the

year-end. Accounting requires all the feeds from various systems at a consolidated level for each

combination of owning and receiving SSA.


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a. Invoice Generation and Complete Payment in the same SSA

Consider a scenario where invoice is generated in Hyderabad and the payment is also made in

Hyderabad.

1. On generation of invoice, relevant sundry debtors and recoverable accounts are debited, with

appropriate credit being given to the various revenue accounts.

2. Customer makes a payment at a collection centre at Hyderabad. The collection centre updates the

PMS about the same through a daily list comprising of collections made by it during the day and that

made by the various collection offices that report to it. This will be sent to Accounting, debiting the

Claims Recoverable from Others/HPO/Bill Desk account as the case may be, and passing the

appropriate credit to TR Collection Account in the books of account of Hyderabad.

3. On receipt of the schedule information and the cheque for the actual payment, TRC Settlement

account is debited, passing the credit to Claims recoverable from. Others/HPO/Bill Desk etc. The

corresponding entry of debiting the Bank Collection Account and crediting the TRC Settlement

Account is done by AO Cash in Cash book of the SSA. Thus the closing of TRC Settlement

account is manual.

4. When information is received from Billing System about the payments clearing the Sundry Debtors

outstanding, the TR Collection Account is debited, crediting the sundry debtors and other recoverable

accounts.

Consider that the following invoice is generated:

Customer Invoice

Fixed charges from subscriber 180 Local Call Charges 500 International Trunk Calls 200 Installation Charges 500 Total 1380 Add Service Tax 166 Education Cess 3 Higher Education Cess 2 Grand Total 1551

Net Payable 1551


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(Service tax figures in examples are approximate & assumed for easy representation )

The accounting treatment is depicted in the following figure.

Figure 1. Billing and complete payment in the same SSA

On Receipt of payment posting data from Billing (In the books of Hyderabad SSA)

1194502 TR Collection a/c Dr. 1551 To 1110101 Sundry Debtors 1380 To 1110901 Service Tax Recoverable 166 To 1110906 Education Cess Recoverable 3

To 1110909 Higher Education Cess Recoverable 2

On Receipt of Schedule data from PMS (In the books of Hyderabad SSA)

1194501 TRC Settlement A/c Dr. 1551

To 1130899 Claims Recoverable from Others 1551

On Receipt of Daily List data from PMS (In the Books of Hyderabad SSA)

1130899 Claims Recoverable from Others Dr. 1551

To 1194502 TR Collection 1551

Accounting entries on Invoice Generation (In the Books of Hyderabad SSA)

1110101 Sundry Debtors LL a/c Dr. 1380 1110901 Service Tax Recoverable (Telephones) Dr. 166 1110906 Education Cess Recoverable Dr. 3 1110909 Higher Education Cess Recoverable Dr. 2 To 1310101 Fixed Charges from Subscriber 180 To 1310201 Local Call Charges 500 To 1310303 International Trunk Calls 200 To 1310601 Installation Charges 500 To 1192301 Service Tax Payable 166 To 1192306 Education Cess Payable 3

To 1192309 Higher Education Cess Payable 2

Invoice in Hyderabad, Payment in Hyderabad

On Receipt of Schedule data from PMS (In the books of AO Cash) (Outside CDR system)

Bank Collection A/c Dr. 1551

To 1194501 TRC Settlement A/c 1551


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b. Excess/Double Payments when payment is made in the Billing SSA

Suppose in the above case, if payment of Rs 2551 is received against the billed

amount of Rs 1551,then there is an excess of Rs 1000. This will be treated as follow:

Figure 2. Excess or double payment in the same SSA

On Receipt of payment posting data from Billing (In the books of Hyderabad SSA)

1194502 TR Collection a/c Dr. 2551 To 1110101 Sundry Debtors (Other than WLL) 1380 To 1110901 Service Tax Recoverable 166 To 1110906 Education Cess Recoverable 3 To 1110909 Higher Education Cess Recoverable 2

To 1193001 Refund due on Double/Excess Payment 1000


Claims Recoverable DOP/Others/Bill Desk/AOCash/Banks a/c Dr. 2551



1110101 Sundry Debtors LL a/c Dr. 1380 1110901 Service Tax Recoverable (Telephones) Dr. 166 1110906 Education Cess Recoverable Dr. 3 1110909 Higher Education Cess Recoverable Dr. 2 To 1310101 Fixed Charges from Subscriber 180 To 1310201 Local Call Charges 500 To 1310303 International Trunk Calls 200 To 1310601 Installation Charges 500 To 1192301 Service Tax Payable 166 To 1192306 Education Cess Payable 3 To 1192309 Higher Education Cess Payable 2

Excess or Double Payment

On Receipt of Schedule data from PMS (In the books of Hyderabad SSA)

1194501 TRC Settlement a/c Dr. 2551

To Claims Recoverable HPO/Others/Banks/AOCash/Bill Desk 2551

On Receipt of Schedule data from PMS (In the books of AO Cash)




NATFM,HYDERABAD 17

For the invoice considered in the previous section, if an excess payment is accepted,

Billing system will have to identify excess payment. As depicted in Figure 3 above, for an

invoice of Rs.1551, a payment is received in excess of Rs.1000, that is, Rs.2551. So

when the TR Collection is cleared by debiting Rs.2551, the exact amount that is enough

to clear them, is credited to respective sundry debtors and other recoverable accounts.

The excess Rs.1000 is credited to the account of „Refund due on Double/Excess

Payments‟.

When the next invoice is generated, this excess amount is adjusted by crediting the

sundry debtors by the excess amount, as depicted in figure 4 and in the invoice depicted

below.

Customer Invoice

Fixed charges from subscriber 180 Local Call Charges 1000 International Trunk Calls 500 Total 1680

Add Service Tax 100 Education Cess 15 Higher Education Cess 5 Grand Total 1800

Less: Excess payment Adjusted 1000

Net Payable 800


NATFM,HYDERABAD 18

Figure 3. Excess or Double Payment Adjustment in the next invoice

In case the balance needs to be refunded, the accounting entries will be as depicted in

Figure 5.

On Clearing outstanding by Billing (In the Books of Hyderabad SSA)

1194502 TR Collection a/c Dr. 800 To 1110101 Sundry Debtors (LL) 730 To 1110901 Service Tax Recoverable 55 To 1110906 Education Cess Recoverable 12 To 1110909 Higher Education Cess Recoverable 3

On Receipt of Schedule (In the Books of Hyderabad SSA)


To Claims Recoverable Bill Desk/HPOBanks/AOCash/Others 800


Claims Recoverable HPO/Banks/AOCash/Others/Bill Desk a/c Dr. 800



1110101 Sundry Debtors (Other than WLL) a/c Dr. 1380 1110901 Service Tax Recoverable (Telephones) Dr. 166 1110906 Education Cess Recoverable Dr. 3 1110909 Higher Education Cess Recoverable Dr. 2 To 1310101 Fixed Charges from Subscriber 180 To 1310201 Local Call Charges 500 To 1310303 International Trunk Calls 200 To 1310601 Installation Charges 500 To 1192301 Service Tax Payable 166 To 1192306 Education Cess Payable 3 To 1192309 Higher Education Cess Payable 2 1193001 Refund due on Double/Excess payment Dr. 1000 To 1110101 Sundry Debtors (LL) a/c 950 To 1110901 Service tax recoverable 45 To 1110906 Education cess recoverable 3


Excess or Double Payment Adjustment

On Receipt of Schedule data from PMS (In the books of AO Cash)

Bank Collection A/c Dr. 800 To 1194501 TRC Settlement A/c 800


NATFM,HYDERABAD 19

Figure 4. Refund of Excess or Double Payment

In case of refund for closed/surrendered connections, the following entries are made:

Figure 5. Refund for closed/surrendered connections

c. Partial Payments made in the Billing SSA

This section deals with the accounting treatment of partial payments that is payment

made is less than the amount outstanding. If we consider a scenario where bill is

generated in Hyderabad for Rs.1130 as shown below.

A payment of Rs. 565 is received at Collection Centre1, say, a cash counter in

Hyderabad The payment received knocks off the debit in relevant sundry debtors and

other recoverable heads through a credit entry in proportion to the payment received, as

depicted in the figure below.

1193001 Refund due for closed or surrendered connections Dr. 1000


Refund for closed/surrendered connections

1193001 Refund due on Double/Excess Payment Dr. 1000 To 1194501 TRC Settlement A/c 1000

Refund of Excess or Double Payment

Customer Invoice



Net Payable 1130


NATFM,HYDERABAD 20

Figure 6 Partial payment made in billing SSA


1194502 TR Collection a/c Dr. 565 To 1110101 Sundry Debtors (LL) 500 To 1110901 Service Tax Recoverable 50 To 1110906 Education Cess Recoverable 10




To Claims Recoverable Bill Desk/HPO/ Banks/AOCash/Others 565


Claims Recoverable Bill Desk/HPO/Banks/AOCash/Others Dr. 565



1110101 Sundry Debtors (LL) a/c Dr. 1000 1110901 Service Tax Recoverable Dr. 100 1110906 Education Cess Recoverable Dr. 20 1110909 Higher Education Cess Recoverable Dr. 10 To 1310101 Fixed Charges from Subscriber 100 To 1310201 Local Call Charges 500 To 1310303 International Trunk Calls 400 To 1192301 Service Tax Payable 100 To 1192306 Education Cess Payable 20


Partial Payment

On Receipt of Schedule data from PMS (In the books of AO Cash) (outside CDR)

Bank Collection A/c Dr.565



NATFM,HYDERABAD 21

On generation of next invoice as depicted below, the partial amount outstanding is also

reflected.

When the payment is received, the outstanding amounts are credited by the proportional

amount, GL Code wise, based on feed received from Billing system. This is depicted in

the following figure.

Figure 7 Partial Payment adjustment in next cycle


1194502 TR Collection a/c Dr. 1695 To 1110101 Sundry Debtors (LL) 1500 To 1110901 Service Tax Recoverable 150 To 1110906 Education Cess Recoverable 30 To 1110909 Higher Education Cess Recoverable 15


1194501 TRC Settlement A/c Dr. 1695 To Claims Recoverable Bill Desk/HPO/Banks/AOCash/Others 1695


Claims Recoverable Bill Desk/HPO/Banks/AOCash/Others a/c Dr. 1695


Partial Payment Adjustment




Customer Invoice Fixed charges from subscriber 100 Local Call Charges 500 International Trunk Calls 400 Total 1000 Add Service Tax 100 Education Cess 20 Higher Education Cess 10 Grand Total 1130 Add: Balance from last invoice 565

Net Payable 1695


NATFM,HYDERABAD 22

d. Remittance to different SSA, Same Circle (Complete payment)

In cases where the SSA where the payment is made is different than the SSA where the

Bill has been generated, we need to pass a remittance entry from the revenue receiving

SSA to the revenue owning SSA.

Accounting System is capable of generating remittance accounting entries for payments

received in SSA other than revenue owning SSA. Revenue owning and revenue

receiving SSAs can be in different Circles in the same Zone.

In order to comply with this requirement it is essential that Billing provides SSA

information for revenue at the time of billing as well as information on revenue owning

and revenue receiving SSA at the time of payment adjustment against outstanding.

In the following figure, a scenario is considered where Invoice is generated in Hyderabad

and payment is made in Vizag, that is both SSAs belong to the same circle. On receipt of

daily list information by PMS, Claims recoverable from collection centre a/c is debited by

the amount received, in the books of accounts of the receiving SSA that is Vizag here,

crediting the TR Collection Account.

When Schedule information and cheque is received by PMS, TRC Settlement account is

debited, thus clearing the outstanding Claims recoverable a/c in the revenue receiving

SSA. On payment feed from Billing system, the correct remittance entries are determined

and posted. TR Collection Account is debited and Originating Remittance same circle

credit entry is made in the books of accounts of revenue receiving, here Vizag. The

responding remittance entry in revenue owning SSA (Hyderabad in this case) is used to

clear the debtors outstanding and other recoverable accounts in revenue owning SSA.

Customer Invoice Fixed charges from subscriber 180 Local Call Charges 500 International Trunk Calls 200 Installation Charges 500 Total 1380 Add Service Tax 166 Education Cess 3 Higher Education Cess 2 Grand Total 1551 Net Payable 1551


NATFM,HYDERABAD 23

Figure 9 Remittance to different SSA in same circle


1110101 Sundry Debtors (Other than WLL) a/c Dr. 1380 1110901 Service Tax Recoverable (Telephones) Dr. 166 1110906 Education Cess Recoverable Dr. 3 1110909 Higher Education Cess Recoverable Dr. 2 To 1310101 Fixed Charges from Subscriber 180 To 1310201 Local Call Charges 500 To 1310303 International Trunk Calls 200 To1310601 Installation Charges 500 To 1192301 Service Tax Payable 166 To 1192306 Education Cess Payable 3


On Receipt of Daily List data from PMS (In the Books of Vizag SSA)

Claims Recoverable Bill Desk/HPO/AOCash/Banks/Others Dr. 1551


On Receipt of Schedule (In the Books of Vizag SSA)


To Claims Recoverable Bill Desk/HPO/ AOCash/Banks/Others 1551

On Clearing outstanding by Billing (In the Books of Hyderabad SSA based on feed from Billing system)

1990401 Remittance same circle (R) Dr. 1551 To 1110101 Sundry Debtors (LL) 1380 To 1110901 Service Tax Recoverable 166 To 1110906 Education Cess Recoverable 3


Invoice in Hyderabad Payment in Vizag

On Clearing outstanding by Billing (Automatically generated by system)

1194502 TR Collections Dr. 1551 Vizag

To 1990201 Remittance same Circle (O) 1551 Vizag

On Receipt of Schedule (In the Books of AO (Cash) Vizag SSA)

Bank Collection a/c Dr. 1551



NATFM,HYDERABAD 24

e. Remittance to SSA of Same Circle (Partial Payment)

This section deals with the accounting treatment of a scenario of Partial payment made in

some other SSA of the same circle in which invoice has been generated. Consider a

scenario where Bill is generated in Hyderabad (AP Circle) and payment is made in Vizag

(AP Circle).

Consider the bill to be the following:

The accounting treatment of the same will be as depicted in the figure below.

Customer Invoice Fixed charges from subscriber 100 Local Call Charges 500 International Trunk Calls 400 Total 1000 Add Service Tax 100 Education Cess 20 Higher Education Cess 10 Grand Total 1130

Net Payable 1130


NATFM,HYDERABAD 25

Figure 10 Remittance to different SSA in same Circle (Partial Payment)

When Billing sends a payment feed to accounting, the correct remittance entries are used to settle

the recoverables by proportional amount as posted by the Billing System.

The next bill is depicted as follows:

Partial Payment Different SSA same Circle


Claims Recoverable Bill Desk/HPO/AOCash/Banks/Others A/c Dr. 565

To 1194502 TR Collections 565








1990401 Remittance same Circle (R) Dr. 565 To 1110101 Sundry Debtors (LL) 500 To 1110901 Service Tax Recoverable 50 To 1110906 Education Cess Recoverable 10


On Clearing outstanding by Billing 1194501 TR Collections Dr. 565 Vizag To 1990201 Remittance same Circle (O) 565 Vizag


Bank Collection a/c Dr. 565



NATFM,HYDERABAD 26

The accounting treatment of the same is depicted in the following figure.

Customer Invoice



Add: Balance from last invoice 565

Net Payable 1695


NATFM,HYDERABAD 27

Figure 81 Remittance to different SSA in same Circle (Partial Payment Adjustment)

Partial Payment Adjustment (different SSA same Circle)


1110101 Sundry Debtors (LL) a/c Dr.1000 1110901 Service Tax Recoverable Dr. 100 1110906 Education Cess Recoverable Dr. 20 1110909 Higher Education Cess Recoverable Dr. 10 To 1310101 Fixed Charges from Subscriber 100 To 1310201 Local Call Charges 500 To 1310303 International Trunk Calls 400 To 1192301 Service Tax Payable 100 To 1192306 Education Cess Payable 20



Claims Recoverable Bill Desk/HPO/ AOCash/Banks/Others Dr. 1695 To 1194502 TR Collections 1695





1990401 Remittance same Circle (R) Dr. 1695 To 1110101 Sundry Debtors (LL) 1500 To 1110901 Service Tax Recoverable 150 To 1110906 Education Cess Recoverable 30


On Clearing outstanding by Billing (Automatically generated)

1194502 TR Collections Dr. 1695 Vizag

To 1990201 Remittance same Circle (O) 1695 Vizag


Bank Collection a/c Dr 1695

To 1194501 TRC Settlement 1695


NATFM,HYDERABAD 28

f. Remittance to different SSA of same Circle (Excess Payment)

Figure 9 Remittance to different SSA in same circle (excess payment)

The accounting treatment here is similar to that where excess payment is made in the owning

SSA itself as depicted in some other Section earlier. The only difference being in remittance

entries.


1110101 Sundry Debtors (Other than WLL) a/c Dr. 1380 1110901 Service Tax Recoverable (Telephones) Dr. 166 1110906 Education Cess Recoverable Dr. 3 1110909 Higher Education Cess Recoverable Dr. 2 To 1310101 Fixed Charges from Subscriber 180 To 1310201 Local Call Charges 500 To 1310303 International Trunk Calls 200 To1310601 Installation Charges 500 To 1192301 Service Tax Payable 166 To 1192306 Education Cess Payable 3


Excess or Double Payment Different SSA same Circle


Claims Recoverable Bill Desk/HPO/ AOCash/Banks/Others Dr. 2551 To 1194502 TR Collections 2551





1990401 Remittance within Circle (R) Dr. 2551 To 1110101 Sundry Debtors (LL) 1380 To 1110901 Service Tax Recoverable 166 To 1110906 Education Cess Recoverable 3 To 1110909 Higher Education Cess Recoverable 2 To 1193001 Refund due on Double/Excess Payment 1000


1194502 TR Collections Dr. 2551 Vizag To 1990201 Remittance same Circle (O) 2551 Vizag

On Receipt of Schedule (In the Books of AO Cash Vizag SSA)




NATFM,HYDERABAD 29

g. Remittance to SSA of different Circle (Full Payment)

Figure 10 Remittance to an SSA in different circle (full payment)

On Receipt of Daily List data from PMS (In the Books of Bangalore SSA)

Claims Recoverable Bill Desk/HPO/Others Dr. 1551 To 1194502 TR Collections 1551


1990309 Remittance between circles Karnataka(R) Dr. 1551 To 1110101 Sundry Debtors (LL) 1380 To 1110901 Service Tax Recoverable 166 To 1110906 Education Cess Recoverable 3


Invoice in Hyderabad Payment in Bangalore


1110101 Sundry Debtors (Other than WLL) a/c Dr. 1380 1110901 Service Tax Recoverable (Telephones) Dr. 166 1110906 Education Cess Recoverable Dr. 3 1110909 Higher Education Cess Recoverable Dr. 2 To 1310101 Fixed Charges from Subscriber 180 To 1310201 Local Call Charges 500 To 1310303 International Trunk Calls 200 To1310601 Installation Charges 500 To 1192301 Service Tax Payable 166 To 1192306 Education Cess Payable 3 To 1192309 Higher Education Cess Payable 2


1194502 TR Collections Dr. 1551 BLR To 1990105 Remittance between circles AP (O) 1551 BLR

On Receipt of Schedule (In the Books of BLR SSA)


To Claims Recoverable Bill Desk/HPO/Others 1551

On Receipt of Schedule (In the Books of AO Cash BLR SSA)(Manual Entry Outside CDR)




NATFM,HYDERABAD 30

In the previous figure , a scenario is considered where Invoice is generated in Hyderabad and

payment is made in Bangalore, that is both SSAs belong to different circles in the same zone.

On receipt of daily list information by PMS, Claims recoverable from collection centre a/c is

debited by the amount received, in the books of accounts of the receiving SSA that is

Bangalore here. TR Collection Account is credited by the same amount. When Schedule

information and cheque is received by PMS, TRC Settlement account is debited, thus clearing

the outstanding Claims recoverable from CC(HPO/Bill Desk/Others) a/c in the revenue

receiving SSA. On payment feed from Billing system, TR Collection account is debited, The

corresponding originating Remittance credit entry is made in the books of accounts of

receiving SSA. The responding remittance entry is used to clear the debtors outstanding and

other recoverable accounts in revenue owning SSA. The remittance account used here is

Remittance between circles.

h. Surcharge on delayed payments (Late fee)

Surcharge on delayed payments is created as an adjustment in Billing system. So when the

adjustment is created the following entries are passed to accounting module:

Figure 11: Surcharge on delayed payments(Late fee)

6. Accounting for GSM Collections

a. GSM Invoice of one Circle, Payment in SSA of same Circle

Consider a scenario where for a GSM Invoice belonging to Punjab Circle, a payment of Rs.

5000 is accepted in an SSA (Ludhiana) of the same Circle. On receipt of feed file from PMS

for Daily list, the amount and the receiving SSA is recognised, with a flag for Collections for

GSM. At this time itself, the accounting entries are passed to debit Claims recoverable from

Others and passing correct remittance entries because in this case there is no clearing feed

obtained from Billing System in this case. On receipt of information at the time of schedule,

TRC settlement account is debited and Claims recoverable account is credited.

Figure 15: Accounting for GSM Collections: Payment in SSA of same Circle

I. On Receipt of Daily List data from PMS with a flag for GSM Payments Particulars Dr Cr Books 1130899 Claims Recoverable from Others A/c 5000 LDH

To 1192899 Claims Payable to CMTS 5000 LDH

II. On Receipt of Schedule data from PMS (IN THE BOOKS OF Ludhiana SSA)

Particulars Dr Cr Books

1194501 TRC Settlement Account 5000 LDH To 1130899 Claims Recoverable from Others 5000 LDH

Invoice in Punjab Circle

Payment at Ludhiana (Punjab Circle) (Full Payment)

1110101 Sundry Debtor (LL) Dr. 1000

1310701To Surcharge on Delayed Payments(Late fee) 1000


NATFM,HYDERABAD 31

The credit entry to TRC Settlement A/c is made in the books of AO Cash with a debit to Bank Collection A/c on receipt of schedule.

b. GSM Invoice of one Circle, Payment in SSA of different Circle

Consider a scenario where for a GSM Invoice belonging to Punjab Circle, a payment of Rs.

5000 is accepted in an SSA (Gurgaon) of Haryana Circle. On receipt of feed file from PMS

for Daily list, the amount and the receiving SSA is recognised, with a flag for Collections for

GSM. At this time itself, the accounting entries are passed to debit Claims recoverable from

Others and passing correct remittance entries because in this case there is no clearing feed

obtained from Billing System in this case. On receipt of information at the time of schedule,

TRC settlement account is debited and Claims recoverable account is credited.

Figure 16: Accounting for GSM Collections: Payment in SSA of different Circle

I. On Receipt of Daily List data from PMS with a flag for GSM Payments Particulars Dr Cr Books 1130899 Claims Recoverable from Others a/c 5000 GGN To1990114 Remittance between Circles (Punjab)(O) 5000 GGN 1990321 Remittance between Circles (Haryana)(R) 5000 Punjab

To 1192899 Claims Payable to CMTS 5000 Punjab

II. On Receipt of Schedule data from PMS (In the books of AO Cash)

Particulars Dr Cr Books Bank Collection A/c 5000 GGN To 1194501 TRC Settlement Account 5000 GGN

Invoice in Punjab Circle Payment at Gurgaon (Haryana Circle)

(Full Payment)

III. On Receipt of Schedule data from PMS Particulars Dr Cr Books

1194501 TRC Settlement Account 5000 GGN To 1130899 Claims Recoverable from Others 5000 GGN


NATFM,HYDERABAD 32

7. Adjustments

The adjustment would update customer balance in billing system and appear on

subsequent bill. The adjustment voucher is required from the billing system to post

accounting entry. Also, when the amount is included in the next invoice, the relevant GL

Code based information will flow from Billing to accounting as depicted in the following

sections.

a. Debit Voucher A debit voucher on account of revenue would arise on account of the following reasons.

Detection of short billing on a previous invoice

Detection of non-billing for any previous period.

To create cheque dishonour charges, if any.

To create late fee to be incorporated into the next invoice.

To deal with special charges to be levied for bold entry in telephone directory etc.

When the billing is done in the above cases, the revenue being invoiced would be

belonging to a previous bill cycle falling within the same fiscal (Accounting) year or an

accounting period in respect of which final accounts have already been closed. In the

former case, no accounting issues are involved and the revenue would be billed as

current year income. In the latter case, we have to follow the accounting policy on dealing

with “prior period income”.

Based on this the amount would be booked either as income in the current year or as

prior period income. Booking of Prior Period income will be done in accounting as a

manual journal entry.

Take an example where short billing on a previous invoice is detected. For recovery of

charges subsequent to generation of bill, a debit is posted in the Billing System. The debit

voucher updates customer account balance in Billing system and appear in subsequent

bill. The debit voucher is posted in accounting simultaneously.The debit voucher is

required from the billing system to post accounting entry. The taxation part of the debit

entries will be taken care of at the time of actual billing. Only the basic amount will be

entered as a debit voucher. This is depicted in following Figure .


NATFM,HYDERABAD 33

Figure 12. Debit Voucher: Settlement of short billed invoice

Customer Invoice Fixed charges from subscriber 1000 Local Call Charges 5000 International Trunk Calls 4000 Add: Adjustment for short Billing 5000 Total 15000 Add Service Tax 1000 Education Cess 200 Higher Education Cess 100 Net Payable 16300

For all debit amounts, applicable taxes will be computed and added while it is invoiced.

On generation of next invoice by the billing system, the debit voucher entry will be passed

like other adjustments as line items, debiting the Sundry Debtors and crediting the

account pending for adjustment. This is depicted in following Figure.

Debit Voucher: Settlement of Short billed invoice

Scenario: Debit voucher against short billing Bill Generated in HYD for Amt. Rs. 10000

(5000 short billed amount) Adjustment of short billing in next invoice

Customer Invoice Fixed charges from subscriber 1000 Local Call Charges 5000 International Trunk Calls 4000 Total 10000 Add Service Tax 1000 Education Cess 200 Higher Education Cess 100 Grand Total 11300 Net Payable 11300

1194502 TR Collection a/c Dr. 11300

1110101 To Sundry Debtors (LL) 10000 1110901 To Service Tax Recoverable 1000 1110906 To Education Cess Recoverable 200 1110909 To Higher Education Cess Recoverable 100

1110101 Sundry Debtors (LL) a/c Dr. 10000 1110901 Service Tax Recoverable Dr. 1000 1110906 Education Cess Recoverable Dr. 200 1110909 Higher Ed Cess Recoverable Dr. 100 To 1310101 Fixed Charges from Subscriber 1000

To1310201 Local Call Charges 5000 To 1310303 International Trunk Calls 4000 To 1192301 Service Tax Payable 1000 To 1192306 Education Cess Payable 200 To 1192309 Higher Education Cess Payable 100

On Detection of Short Billing (Debit Voucher information from Billing) 1131025 Debit amount pending for adjustment Dr.5000

1310101 To Fixed Charges from Subscriber 2500 1310201 To Local Call Charges 2500


NATFM,HYDERABAD 34

Figure 18. Accounting for debit voucher (Settlement of short billed invoice) on

generation of next invoice

b. Credit Voucher

The credit voucher would update customer account balance in Billing system and

appear in subsequent bill. The credit voucher will be posted in accounting

simultaneously. The credit voucher is required from the billing system to post accounting

entry.

The scenario in the following figure depicts a case where the bill is generated for

Rs.11300 and payment is made for Rs.11300, clearing the bill. Post the settlement of the

invoice, it is realised that the customer was billed in excess for Rs.5000.

Debit Voucher: Generation of Next Invoice

1110101 Sundry Debtors (LL) a/c Dr. 10000 1110901 Service Tax Recoverable Dr. 1500 1110906 Ed Cess Recoverable Dr. 30 1110909 HEC Recoverable Dr. 15 1110101 Sundry Debtors (LL) Dr. 5000 To 1310101 Fixed Charges from Subscriber 1000 To 1310201 Local Call Charges 5000 To 1310303 International Trunk Calls 4000 To1 192301 Service Tax Payable 1500 To 1192306 Education Cess Payable 30 To 1192309 Higher Education Cess Payable 15

To 1131025 Debit amount pending for adjustment 5000


NATFM,HYDERABAD 35

Figure 19. Accounting for Credit Voucher where the bill is fully settled

On generation of next invoice, this account created for parking the excess credit pending

for adjustment, is debited and the appropriate Sundry Debtors and recoverable amounts

are credited with the excess amount. This is depicted in the following figure.

Scenario: Credit voucher against excess billing

Bill Generated in HYD for Amt. Rs. 10000 (5000 excess billed amount) Adjustment of excess payment in next invoice

Customer Invoice



Net Payable 11300

On detection of excess billing 1310101 Fixed Charges Dr. 3000 1310201 Local call charges Dr. 2000

1194504 To Credit amount pending for adjustment 5000

1194502 TR Collection a/c Dr. 11300 1110101 To Sundry Debtors (LL) 10000 1110901 To Service Tax Recoverable 1000 1110906 To Education Cess Recoverable 200 1110909 To Higher Education Cess Recoverable 100

1110101 Sundry Debtors (LL) a/c Dr. 10000 1110901 Service Tax Recoverable Dr. 1000 1110906 Ed Cess Recoverable Dr. 200 1110909 HEC Recoverable Dr. 100 1310101 To Fixed Charges from Subscriber 1000 1310201 To Local Call Charges 5000 1310303 To International Trunk Calls 4000 1192301 To Service Tax Payable 1000 1192306 To Education Cess Payable 200 1192309 To Higher Education Cess Payable 100

Credit Voucher: Where the bill is already fully settled


NATFM,HYDERABAD 36

Figure 20. Accounting for Credit Voucher on Generation of new Invoice

c. Cancellation of Invoice

Although the system is capable of accounting for invoice cancellation, but as a part of

best practices, this scenario is not present. The adjustment to the invoice will flow

like normal adjustments to accounting. Correspondingly, entries would be passed

in Accounting related to the reversal/cancellation.

d. Write off of Bad Debts

Write offs are manual. Reversal of write-offs not supported.

Collections against write-off, if any, will go to „Other Income‟. Service tax need not be

taken into account for that. The flow to accounting will be from PMS.

For an active customer there will be no write-off; only adjustments will be posted to

customer account in Billing. Write-off can only be for a closed account.

Credit Voucher: Generation of new invoice

Scenario: Credit voucher against excess billing

Bill Generated in HYD for Amt. Rs. 10000 (5000 excess billed amount) Adjustment of excess payment in next invoice

Customer Invoice Fixed charges from subscriber 1000 Local Call Charges 5000 International Trunk Calls 4000 Gross Total 10000 Less: Adjustment for excess Billing 5000 Net Total 5000 Add Service Tax 500 Education Cess 100 Higher Education Cess 50 Grand Total 5650 Net Payable 5650

1110101 Sundry Debtors (LL) a/c Dr. 10000 1110901 Service Tax Recoverable Dr. 500 1110906 Education Cess Recoverable Dr. 100 1110909 HEC Recoverable Dr.50 1310101 To Fixed Charges from Subscriber 1000 1310201 To Local Call Charges 5000 1310303 To International Trunk Calls 4000 1192301 To Service Tax Payable 500 1192306 To Education Cess Payable 100

1192309 To Higher Education Cess Payable 50

1194504 Credit amount pending for adjustment Dr. 5000 1110101 To Sundry Debtors Landline 5000


NATFM,HYDERABAD 37

Figure 21. Accounting for Write Off of Bad Debts

Any write-off because of erroneous usage will come as an adjustment in the subsequent

bill. Account of the same will be done based on the feed received from Billing.

e. Collection against Write off

For Collections made against written off amount, feed will flow in to accounting from

Payment Management System. The accounting entries made will be:

1194502 TR Collection Dr. 1000

To 1410199 Other Income 1000

In case of Receiving SSA being different from Owning SSA, the correct remittance

entries will be passed before crediting Other Income account.

Write Off of Bad Debts

When Bad Debts written off (Flow from Billing to Accounting) 1742006 Bad Debts Dr. 4900 ST payable etc Dr 500 To 1110101 Sundry Debtors Telephones 4900 ST recoverable etc 500

At close of Accounting Period (Manual Entry in EFS) 1200115 Provision for Bad and Doubtful Debts Dr. 4900

To 1742006 Bad Debts 4900

If Provision is insufficient (Manual Entry in EFS) P&L Account Dr. 1000 To 1200115 Provision for Bad and Doubtful Debts 1000 In case of Excessive Provision (Manual Entry in EFS) 1200115 Provision for bad and doubtful debts Dr. To To

1410314 Other Income – Excess provision written back Cr.


NATFM,HYDERABAD 38

8. Payments from Various Channels

a. Payments on CSR counter

On Billing:

Figure 22 Accounting Entry on Billing

The online collections made in a day by each CSR counter will get captured in the PMS

database with the necessary details. The collections made by each counter will be tallied and

also the total collection by each online collection center. The total collections as per the daily

collection statement for each Collection Center will be accounted for as follows based on feed

from PMS. The account to be debited would be Claims recoverable from AO(Cash).

Figure 23 Accounting entry on receipt of daily list

Periodically, the PMS will generate a schedule of collections for each online collection center.

It should be noted that the TRC Schedule is prepared by the collection centers concerned in

respect of offline collection, which is reconciled with the corresponding payments entered into

the PMS. However, since the collection in this case is directly accounted for in the SSA level

Bank (Collection) Account on a day to day basis, by the AO Cash, the schedule would be

generated by the PMS and got verified and certified with respect to actual amounts in the

collection account from the AO (Cash).

The schedule will show the total amount of TR collection made by the center. Differences if

any arising out of verification prescribed above will be examined and reconciled. PMS will

provide an interface for entering the actual collection for the month as obtaining from the SSA

bank books (which should be the amount generated in the schedule). Based on feed from

PMS, accounting will record another transaction as follows:

Figure 24 Accounting entry on receipt of TRC Schedule and Cheque

1110101 Sundry Debtors Landline Dr. 4500 1110901 Service tax recoverable Dr. 540 1110906 Education Cess recoverable Dr. 20 1110909 Higher Education Cess recoverable Dr. 5 1310101 To Rental charges 500 1310201 To Call charges 4000 1192301 To Service tax payable 540 1192306 To Education Cess Payable 20

1192309 To Higher Education Cess Payable 5

1132304 Claims Recoverable from AO(Cash) Dr. 5065 1194502 TR Collections 5065

1194501 TRC Settlement A/c Dr. 5065 1132304 To Claims Recoverable from AO(CASH) 5065


NATFM,HYDERABAD 39

The credit entry for this TRC Settlement account is created in the books of AO Cash when

Collection bank is debited.

Bank/Cash A/c Dr. 5065

1194501 To TRC Settlement 5065

b. Payments from Post Offices

Post Offices collect the payments against invoices presented to them along with cash or

Cheque drawn in the favour of the Post Master concerned. Each Post Office will prepare

a daily list of collections being a list showing the account number, phone number, bill date

and the amount collected in multiple copies. One copy of this list along with the

counterfoils of the invoices is sent to the Accounts Officer of the SSA concerned. The

Post Office sends no money along with the daily list to Accounts Officer. The Cheques

received are sent for collection by the post office and is credited to the post office

account. The concerned Head Post Office does the account settlement for collections

made by post offices. The collecting office will incorporate their daily collections in their

accounts and sent this along with a copy of the daily list of Telecom Bill collections to the

HPO concerned.

Post Office accepts cheque only in the postmaster‟s name. Settlement is done only at

Head Post Office. Daily list is received on a daily basis from Post Offices. Schedule can

be received periodically from head post office along with a cheque after deduction of tax

and commission. A summary schedule is received at the end of the month.

On receipt of Daily List:

The online collections made in a day by each Post Office will be captured in the PMS

database with the necessary details. The collections made by each Post Office will be

tallied and the total collection by each Head Post Office. The total collections as per the

daily collection statement for each Collection Center (HPO) will be accounted as follows

in the PMS

Figure 25 Accounting entry on receipt of daily list from Head Post Office

On receipt of TRC Schedule and Cheque:

The periodical TRC schedule will show the total amount of TR collection made by the

collection center, here HPO. Differences if any arising out of verification prescribed above

will be examined and reconciled. PMS provides an interface for entering the actual

collection for the month as obtaining from the SSA bank books (which should be the

1132301 Claims Recoverable from DoP Dr.5000 1194502 To TR Collection 5000


NATFM,HYDERABAD 40

amount generated in the schedule). Based on this entry, the following accounting

transactions will be entered:

Figure 13 Accounting entry on receipt of TRC Schedule, Cheque from HPO

The Post Office is entitled to commission at the prescribed rate for doing the TR

collection. They are authorized to do the settlement of accounts after deducting the

commission and service taxes due on the commission.

On outstanding settlement feed from Billing:

There will be a flow from the Billing System regarding the clearance of sundry debtors

outstanding, after receipt of relevant information from PMS. Thus the TR Collection a/c is

debited with corresponding credit to Sundry Debtors.

Figure 27 Accounting entry on receipt of payment information from Billing

c. Payments from Banks

The accounting entries remain the same as for other channels except that the GL code to

be debited on receipt of daily list is:

1132303 Claims Recoverable from Banks

Bank Charges can not be deducted directly from the cheque sent to BSNL. Banks have

to claim from BSNL and get it settled.

Accounting for commission of banks is to be done in EFS.

d. Payments through ECS

ECS will be considered as a part of Online(Cash Counters) payment channel. As and

when PMS gets updated about the amount collected from this channel it will update

1194501 TRC Settlement A/c Dr. 4850 1742701 Commission to DoP Dr. 100 1131505 Service Tax(input service) Dr. 40 1131506 Education Cess Dr. 8 1131509 Higher Education Cess Dr. 2 1132301 To Claims Recoverable from DoP 5000

1194502 TR Collections Dr. 5000 1110101 To Sundry Debtors Landline 4940

1110901 To Service Tax recoverable 50

1110906 To Education Cess recoverable 8

1110909 To Higher Education Cess Recoverable 2


NATFM,HYDERABAD 41

accounting. For the ECS customers additional discount is provided and feed for the same

will be provided by the Billing system on the next invoice as separate line item. The

accounting entries are as depicted in the following figure.

Figure 28 Accounting treatment for Discount on ECS

On Daily list entry 1132304 Claims recoverable from AO(Cash) Dr. 100000 To 1194502 TR Collection 100000 On entry of schedule by AO(Cash) 1194501 TRC Settlement Dr. 100000

To 1132304 Claims recoverable from AO(Cash) 100000 On payment settlement feed from Billing system 1194502 TR Collection Dr. 100000

To 1110101 Sundry Debtors (Telephones) 89000 To 1110901Service Tax Recoverable 10700 To 1110906 Education Cess recoverable 200 To 1110909 HEC recoverable 100

On generation of credit voucher for discount/rebate(feed from Billing system)

1742602 Discount on ECS Dr. 1000 1194504 To Credit amount pending for adjustment 1000

On generation of next invoice (feed from Billing system)

1194504 Credit amount pending for adjustment Dr. 1000 1110101To Sundry Debtors (Telephones) 890 1110901To Service Tax Recoverable 107 1110906To Education Cess recoverable 2

1110909To HEC recoverable 1


NATFM,HYDERABAD 42

e. Payments through Bill-desk: We are dealing with the collections made by "BILL DESK" payment aggregator in THREE

different ways.

1. Online Web based payments made by CDR system customers through the Web Self-Care

portal of the CDR system. This is online payment from the CDR system perspective in that

the invoice data is accessed by the portal directly from the CDR system and the payment

processing is done online without any manual intervention.

(This is under implementation stage)

2.Web based payments made by CDR customers through BSNL All India Portal. This is

NOT an online payment from the CDR system perspective since the invoice or payment data

does not flow seamlessly between the AIP and the CDR system. The payment data is

captured into the CDR system through manual intervention. It is an offline channel for the

CDR system.

3. A third option is that the customer registers with bill-desk system and the payment due is

collected through Direct Debit to the registered customers' bank account. This solution

operates more or less completely outside the BSNL systems. It is also an offline channel.

All the above three modes of operation cannot be dealt with through a single channel

configuration. We are actually dealing with three distinct channels although the aggregator

operating behind all the three channels is the same. One physical entity is actually operating

through three different logical entities. Mixing these and operating a single channel to deal

with the three situations explained above will lead to serious reconciliation issues. The basic

concept of payment channel is not based purely on the 'person' behind the collection activity,

it is based both on the person and the solution behind the collection activity. A single

channel can be operated only when the person and solution are identical. If there is a

mismatch, a new payment channel would originate.

The solution to deal with the present situation is as follows:

1. Operation through WSC of CDR system will be dealt with as 'bill desk' channel and will

use related GL code „1132302 CDR TRC Claim WSC‟.

2. All India Portal is dealt with as collections by External Accounting System. It is already

made clear in the BSNL CO circular 209 that the BSNL units collecting invoices issued from

the CDR system and operating outside the CDR system will be handled as per instructions

related to the handling of EAU payments. This will use the GL code „1132306 CDR Claims

EAU‟


NATFM,HYDERABAD 43

3. Operation through bill desk web site is essentially based on a 'franchisee' concept. It is an

outsider solution. It has to be dealt with accordingly through GL code „1132399 CDR TRC

Claim others‟..

The aggregator cannot mix collections related to the above three types of solutions and

make a single settlement. It has to be separated. Some settlements are at SSA level and

some will be at the centralized level (AP Circle) and the others at the DC SSA level. All

collections will involve schedule entries. No reconciliations are possible unless the schedule

is entered and the related payment details are also captured through the PMS.

Accounting for Web Self Care(WSC):

In CDR based billing and Customer Care system (BCCS), a Payment Managemenrt System

(PMS) is available which will accept payments against bills. PMS will be operational for a CDR

Zone. The WEB SELFCARE System(WSC)which is also a part of CRM Software, is also Zone

specific A landline customer or any other customer being served by the above BCCS who wishes to

make payment of his bills through internet will access the WSC of the Zone for information

regarding bill and will then be re-directed to an online payment platform (OLPP) where payment can

be made using the available options of bank account/debit card/credit card as the case may be. The

detailed operational procedures are available in CO letter No. 1-8/BFCI/CI/CDR Procedure/09-10

dated 15/12/2009.

The accounting flow in the CDR system is similar to other online/offline channels .

Following are the accounting flow:

When daily list is posted in the PMS (online):

1132302 Claims Recoverable from WSC (BillDesk) Dr

1194502 To TR Collections.

When Money is received from the aggregator:

Collection Bank Dr

1194501 To TRC Settlement Account

(Entry done in the EFS Bank Book)

When schedule is entered in the PMS:

1194501 TRC Settlement Account Dr

To Claims Recoverable from WSC (Bill Desk)


NATFM,HYDERABAD 44

When feed from billing is received for the payments:

(In books of DC SSA-automated entries in the CDR system)

1194502 TR Collections a/c Dr

To Sundry debtors, ST recoverable etc.(For amounts in respect of DC SSA)

1191100 To Remittance Same Circle (O) (for SSAs in AP in respect of South DC)

To Remittance between Circles-<Circle name>(O)

(In the books of respective SSAs - automated entries in the CDR system)

Remittance same Circle( R ) Dr

To Sundry debtors, ST recoverable etc. (for SSAs in AP)

Remittance between Circles –AP ( R ) Dr

To Sundry Debtors etc (for SSAs in other Circles)

f. Dealing with payments involving units outside the CDR system(ERU)

Definitions: External Revenue Unit (ERU) or External Accounting Unit(EAU): A BSNL unit outside

the CDR system other than the GSM system that:

i) Receives advance payment in relation to service to be provided from the CDR system or

ii) Collects payments on invoices issued from the CDR system or

iii) Expects payment transfers from the CDR system relating to invoices issued by it and

collected by the CDR system.

Note: The term will also cover systems operated by units already operating from the CDR

system while also maintaining other systems that are not migrated to the CDR System.

External Financial System (EFS): Refers to that part of the books of accounts of a BSNL

unit that is operating through the CDR system, which is maintained outside the CDR system

ERP. In this case accounting for the TR transactions is done by the ERP module of the

CDR system which will get incorporated into the EFS to generate the complete accounting

statement for the unit concerned.

ATC Settlement Account: A new GL code 1194506 - CDR based ATC settlement Account has

been created in the BSNL Books to deal with ERU related Advices of Transfers. This will be

operated in a manner similar to that of “TRC Settlement Account” already in operation. This

head will deal with funds movement handled through book adjustments while TRC

Settlement account will operate for actual cash/bank transactions. ATC Settlement Account

will operate through a journal entry in the external financial system (EFS) while TRC

Settlement Account will operate through an entry in the Cash/Bank book in the EFS.


NATFM,HYDERABAD 45

Scenario-I:

Demand Notes paid outside CDR system for services to be provisioned from the CDR system.

a. Situation:

Bhopal SSA is operating from the CDR system. A customer makes a payment of demand

note for services like LL and/ or BB in a SSA other than Bhopal SSA. The payment receiving

SSA raises ATC for the payment so received and based on such ATC the Bhopal SSA

provides the services to the customer parented to it. This has happened in case of forest

Department.They made the payment for Broadband connections at Indore for all

connections to be provided across MP. Based on the ATC received from Indore, Bhopal

SSA provided the required connections.

Demand Note is issued from the Indore SSA. Payment is made at Indore SSA. There are 20

connections to be provided from Bhopal SSA. Case is one in which service is to be

provisioned from the CDR system based on demand notes issued and paid at an ERU.

b. End to End Flow:

i) No Accounting Entry is required in the books of Indore SSA (ERU operating outside the CDR

system) for the demand note issued by the Indore SSA.

ii) When the demand note payment is received by Indore SSA (ERU), an Advice of Transfer

Credit will be issued by it by passing the following entries in its books:

Collection Bank A/c Dr.

To Remittance Same/Between Circle(s) (Originating).

Note: The SSA will NOT operate the Remittance GL codes specifically issued for use

within the CDR system as per BSNL CO (CA Section) Circular-190. It will use the

regular Remittance Heads only.

iii) The ATC received from the Indore SSA will be accepted by Bhopal SSA (Operating within

the CDR system) in its External Financial System (EFS). The journal entry to be passed by

Bhopal SSA will be as follows:

Remittance Same Circle(s) (Responding) Dr

To ATC Settlement Account

iv) The demand note will be re-created for the Bhopal SSA in the CDR system through its CRM

module. Such demand notes will be re-created for each customer account although the

customer might have paid a single consolidated Demand Note at the ERU.


NATFM,HYDERABAD 46

v) Payment noting for this demand note will be done through a batch entry done manually

through the PMS of the CDR system. These payments will be tagged to a new Payment

Channel named as „ERU‟ which will have the new payment mode „ATC‟. The payment

channel and the payment mode are created in the PMS. The payment mode „ATC‟ will be

used only by the payment channel „ERU‟.

vi) The accounting entries for such payments will be to debit Claims Recoverable from ERU

and to Credit TR Collections. The GL Code „Claims Recoverable from ERU‟ is created

newly in the BSNL books.

vii) A schedule entry will be made by the AO (Cash) based on ATC acceptance. This is

equivalent to cheque receipt from the collection centre entered in to the cash book. The

accounting entries arising out of schedule entry will be to debit ATC Settlement Account

and credit Claims Recoverable from ERU.

viii) Further flow for provisioning of the service and its billing will proceed without any change as

is happening in the case of any demand note paid by Cash/Cheque/DD.

ix) When the trial balance from the CDR system ERP and that from External Financial System

get merged, the GL code ATC Settlement Account will have a zero balance. In case this is

not the case, it will indicate missing or wrong accounting entries in the system.

Scenario-II:

Bills generated by the CDR system gets paid in an External Revenue Unit (ERU)

a. Situation:

A customer makes a payment of a bill issued from the CDR system in a unit outside the

CDR system (ERU). For instance a consolidated bill for e-governance services is collected

by Northern Telecom Region (NTR). The payment receiving unit sends the paid invoice

details to the customer owning SSA operating from the CDR system. It also raises ATC for

the payment so received.

b. End to End Flow:

i) Accounting Entries for the revenue and taxes billed is done in the CDR system in the books

of the customer owning SSA (Operating from the CDR system) for the invoices issued by it.

When the invoice is paid, the details are sent to the SSA concerned. This constitutes the

„daily list‟ for the purpose of payment noting at the Payment Management System (PMS).

The payment receiving unit (ERU) will also issue an Advice of Transfer Credit targeted at the

customer owning SSA. The journal entry as follows will be passed by the ERU for the ATC:

Collection Bank A/c Dr.

To Remittance between Circle (Originating)


NATFM,HYDERABAD 47




ii) When the daily list is entered into the system, the following accounting entries will get

passed:

1132306 - „CDR based Claims recoverable from ERU Dr

1194502 To TR Collection




iii) PMS will send the batch to the billing system. The billing system will deal with the batch in

the usual manner. No special accounting handling is required at the billing system level for

ERU payments.

iv) The ATC received from the ERU will be accepted by Bhopal SSA (Operating within the CDR

system) in its External Financial System. The journal entry to be made by Bhopal SSA will

be as follows:

Remittance between Circles (Responding) Dr

1194506 -To ATC Settlement Account

v) A schedule entry will be done by the AO (Cash) for the ATC related payments on invoices

generated by the billing system. This schedule entry will lead to the following accounting

entries:

1194506-ATC Settlement Account Dr

1132306 To Claims Recoverable from ERU

vi) When the trial balance from the CDR system ERP and that from External Financial System

get merged, the GL code ATC Settlement Account will have a zero balance. In case this is

not the case, it will indicate missing or wrong accounting entries in the system.

Important Note: The same approach (with the required changes in GL Codes) is

applied for dealing with BSNL Web Portal Payments.


NATFM,HYDERABAD 48

Scenario-III:

Bills generated in the ERU gets paid in the CDR system

a. Situation:

A customer makes the payment of a bill issued from an ERU through the PMS of the CDR

system. For instance a bill issued for leased line from an outside system (say TWARIT or

NIB-P3) gets paid through the PMS. No invoice or customer details are present in the CDR

system. The PMS will receive this as „Third Party System payments‟. The payment receiving

unit within the CDR system raises ATC for the payment so received in favour of the ERU

concerned.

No such ATC will be issued in case the third party system is parented to the SSA operating

through the CDR system.

b. End to End Flow:

i) Accounting Entries for the revenue and taxes billed is done in the ERU system for the

invoices issued by it.

ii) When the invoice is paid, the details are sent to the SSA concerned (Through the counter

foil of the paid invoice and a daily list in the form of statement of payments).

iii) The accounting for the payment will be done in the CDR system as follows

Claims Receivable from (the collection channel) Dr

To Third Party TR Collection Account

iv) The payment gets noted in the ERU.

v) The payment receiving unit within the CDR system will also issue an Advice of Transfer

Credit targeted at the customer owning SSA (ERU) from the EFS. The journal entry as

follows will be passed by the ERU for the ATC:

Third Party TR Collection A/c Dr.

To Remittance same/between Circle (Originating)




vi) The ATC issued by the CDR unit will be accepted by the ERU by debiting the corresponding

„Remittance‟ head and crediting the relevant account head for „Sundry Debtors‟ and Taxes

etc in the ERU books.

vii) In case the system considered as ERU is parented to a unit operating through the

CDR system (as in the case of Hyderabad where leased line bills are issued through the

DOTSOFT system for which payment is received through the PMS as TPS payment), no

ATC will be involved. The unit (say Hyderabad) will directly pass a journal entry in their


NATFM,HYDERABAD 49

External Financial System (EFS) debiting „Third Part TR Collection Account‟ and crediting

Sundry Debtors and others.

viii) When the trial balance from the CDR system ERP and that from External Financial System

get merged, the GL code 1194505- Third Party TR Collection will have a zero balance. In

case this is not the case, it will indicate missing or wrong accounting entries in the system.

9. Cheque Dishonour Scenario Cheque dishonour information is captured in PMS. Cheque dishonour information is reflected as a

negative receipt in the daily list of the day when the information regarding dishonour of cheque is

received.

A. We have to segregate the cheques broadly into three categories.

1) Cheques submitted by customers and drawn in favour of the designated BSNL

authority. Such cheques from the customers are expected to come only through

channels (online/offline) directly operated by BSNL. Such cheques are entered into

the collection Bank book of the SSA before being sent for realization.

2) Cheques submitted by customers when payments are made at channels NOT

operated directly by BSNL. Such cheques are expected to be drawn in favour of the

channel authority concerned (say Post Master/Branch Manager of the Bank etc).

Settlement between channel and BSNL will happen only to the extent of cheques

realized. But cheques dishonoured after the daily lists are sent will be intimated to

BSNL by the channel authorities.

3) Cheques received in settlement of the collections made by channels that are NOT

operated directly by BSNL. Such cheques are not expected to get dishonoured. Yet

provision is created in the system to deal with such dishonours too. In such cases

the payments made by the customer will not be affected.

B. In respect of (A.1) above, the accounting entries are as follows:

a) On the creation of daily list (and posting of payment after due verification).

(Automated Entries in the CDR System)

Claims Recoverable from BSNL Cash Counters Dr To

i. TR Collection Account Cr

(If the payments relate to bills issued from the CDR system) OR

ii. Claims Payable to CMTS Account Cr

(If payments relate to bills issued from the CMTS system) OR


NATFM,HYDERABAD 50

iii. Third Party TR Collection Account Cr

(If payments relate to Bills issued from the External Financial System)

b) On Posting of the Payment by the CDR Billing System (Applicable for (i) above) (Automated Entries in the CDR System)

TR Collection Dr. To Sundry Debtors Etc Cr

c) On posting of Payment by the CMTS Billing System (Applicable for (ii) above) (Entries in the CMTS System)

Claims Receivable from Basic Segment Dr To Sundry Debtors Etc (CMTS) Cr

d) On posting of Payment by the EFS Billing System (Applicable for (iii) above)

(Entries in the EFS)

Third Party TR Collection Account Dr To Sundry Debtors Etc (TPS) Cr

e) On Posting of the Collection in the Collection Bank Book of the SSA (In All

Cases). (Entries in the EFS)

Bank Dr To TRC Settlement Account Cr

f) On Posting (Acknowledging) of the Collection in the PMS (As part of Schedule Entry)

(Automated Entries in the CDR System)

TRC Settlement Account Dr To Claims Recoverable from BSNL Cash Counters Cr

g) On Receipt of Cheque Dishonour information from the Bank (In All Cases). (Entries in the EFS)


To Bank Cr

h) On Posting of Cheque Dishonour in the PMS. (Automated Entries in the CDR System)

i. TR Collection Account Dr



NATFM,HYDERABAD 51

ii. Claims Payable to CMTS Account Dr


iii. Third Party TR Collection Account Dr

(If payments relate to Bills issued from the External Financial System)

To

Claims recoverable from Cash Counter Cr

On TR reconciliation done by AO(cash):

Claims recoverable from cash Counter Dr

To TRC settlement account Cr

i) On Posting of the Dishonour by the CDR Billing System (Applicable for (i) above) (Automated Entries in the CDR System)

Sundry Debtors Etc Dr To TR Collection Account Cr

j) On posting of Dishonour by the CMTS Billing System (Applicable for (ii) above) (Entries in the CMTS System)

Sundry Debtors Etc (CMTS) Dr To Claims Receivable from Basic Segment Cr

k) On posting of Dishonour by the EFS Billing System (Applicable for (iii) above) (Entries in the EFS)

Sundry Debtors Etc (TPS) Dr To Third Party TR Collection Account Dr

C. In respect of (A.2) above, the accounting entries are as

follows:

a) On the creation of daily list (Loading/Manual Batch entry in the PMS). (Automated Entries in the CDR System)

Claims Recoverable from <Channel Concerned> Dr To

i. TR Collection Account Cr


ii. Claims Payable to CMTS Account Cr


(Payments related to Bills issued from the External Financial System not

expected)

b) On Posting of the Payment by the CDR Billing System (Applicable for (i)

above) (Automated Entries in the CDR System)


NATFM,HYDERABAD 52

TR Collection Dr. To Sundry Debtors Etc Cr

c) On posting of Payment by the CMTS Billing System (Applicable for (ii) above) (Entries in the CMTS System)

Claims Receivable from Basic Segment Dr To Sundry Debtors Etc (CMTS) Cr

d) On Receipt and entry of Cheque Dishonour information from the Channel with

respect to Customer cheques drawn in favour of the Channel Authority. Entry is done in the PMS. (Automated Entries in the CDR system)

i. TR Collection Account Dr


ii. Claims Payable to CMTS Account Dr

(If payments relate to bills issued from the CMTS system)

To

Claims Recoverable from <Channel Concerned> Cr

e) On Posting of the Dishonour by the CDR Billing System (Applicable for (i) above) (Automated Entries in the CDR System)

Sundry Debtors Etc Dr To TR Collection Account Cr

f) On posting of Dishonour by the CMTS Billing System (Applicable for (ii) above) (Entries in the CMTS System)

Sundry Debtors Etc (CMTS) Dr To Claims Receivable from Basic Segment Cr

D. In respect of (A.3) above, the accounting entries are as

follows:

a) On Posting of the Settlement Cheque from Channel in the Collection Bank Book of the SSA (In All Cases). It is assumed that for cheque payments received by the channels, they will settle with BSNL only to the extent of cheques realized by them( ie after deducting the dishonour amount if any) (Entries in the EFS)

Bank Dr To TRC Settlement Account Cr


NATFM,HYDERABAD 53

b) On posting of the Settlement Cheque in the PMS (As part of the Schedule Entry) (Automated Entries in the CDR System)


To Claims Recoverable from <Channel Concerned> Cr

c) On posting of the Settlement Cheque Dishonour in the Collection Bank Book

(Entries in the EFS) TRC Settlement Account Dr

To

Bank Cr

d) On posting of Dishonour of SETTLEMENT CHEQUE in the PMS. (Automated Entries in the CDR System)

Claims Recoverable from <Channel Concerned> Dr To TRC Settlement Account Dr

10. Missing Daily Lists Scenario (Unadjusted Credits) This case will be treated as un-vouchered payment where the schedule amount is more than the

consolidated daily list amount and the difference is posted to the un-vouchered or unadjusted credit

account. The feed for the amount to be posted to unadjusted credits will be provided by PMS and

adjustment of the same will be handled internally by PMS and billing system. As and when the

missing information is recovered, the amount is moved from the un-vouchered account to TR

Collection account or remittance account as the case may be, based on feed from PMS.

Subsequently, the relevant Sundry Debtors and other recoverable accounts shall be cleared with a

feed from the billing system.

Figure 29 Accounting entry for Missing Daily list

When in schedule, it is determined that a daily list is missing Debit Credit SSA

1132301 Claims recoverable from DOP 1000 SSA1 To 1194503 Unallocated TR collection 1000 SSA1

1194501 TRC Settlement A/c 1000 SSA1 To 1132301 Claims recoverable from DOP 1000 SSA1

When daily list information is obtained 1194503 Unallocated TR colln a/c 1000 SSA1

To 1194502 TR Collections 1000 SSA1


NATFM,HYDERABAD 54

11. Reconciliation Bank reconciliation will not be handled in Accounting. TRC Settlement account shall only be

maintained as a control account for collection from banks as collection centre. This account shall be

settled during the period closing activities.

Bank Accounts shall be maintained at AO Cash level by AO Cash for each SSA.

Post Office: Reconciliation of schedule received from Head post office with Daily list received from

Post office will be done at time of posting schedule to be carried out by Payment Management

System.

Bank: Reconciliation of schedule received from Head office(main branch) with Daily list received

from Nodal Branch will be done at time of posting schedule to be carried out by Payment

Management System.

Reconciliation with other systems can be done by comparison of SSA wise GL Extract and trial

balance obtained from the Accounting system and a detailed report obtained from the base systems

(Billing, PMS etc) manually.

12. Accounting for sale of Pre-paid Cards/Modem through PMS counters

Direct sales in respect of the following items are taking place through PMS counter:

(1) Modem

(2) EVDO Cards

(3) NIC Cards

(4) VCC Cards

(5) GSM Prepaid cards

In addition to direct sales, there is also option to bill the modem costs through regular invoices.

Modem cost is configured inclusive of sales tax. Sales tax is not configured in the billing system.

Hence it needs to be handled in the EFS by taking the modem sales report from PMS/Billing.

The items at serial (1) ,(2) & (3) above are credited to

„1361007 Sale proceed from Modem‟ and

The items at (4) & (5) above are credited to

'1350804 Income against CDR PP card'

Necessary journal entries need to be made in the EFS to account for the actual items and the sales

tax element.

13. Accounting for Advance Payments

If a prospect customer makes an advance payment of Rs. 1000, PMS sends the feed in the form of a

normal daily list. The accounting entries would be as follows:


NATFM,HYDERABAD 55

113230? Claims recoverable from <channel> Dr. 1000


On Schedule entry, the accounting entries would be

1194501 TRC Settlement account Dr. 1000

To 113230? Claims recoverable from <Channel> 1000

Billing system will send a feed file classifying this to be an advance payment. The accounting entries for the same would be:

1194502 TR Collection Dr. 1000

To 1191100 Advance from customers 1000

When the service is provisioned and the prospect becomes a customer, the invoice is generated and the following accounting entries would be done:

1110101 Sundry Debtors (Telephone) Dr. 1680

1110901 Service tax recoverable Dr. 100

1110906 EC Recoverable Dr. 15

1110909 HEC Recoverable Dr. 5

To 1310101 Fixed charges 1680

To 1192301 Service tax payable 100

To 1192306 EC Payable 15

To 1192309 HEC Payable 5

1191100 Payment received in advance Dr. 1000

To 1110101 Sundry Debtors (Telephone) 1000

Customer Invoice Fixed charges from subscriber 1680 Total 1680 Add Service Tax 100 Education Cess 15 Higher Education Cess 5 Grand Total 1800 Less: Advance payment Adjusted 1000 Net Payable 800


NATFM,HYDERABAD 56

14. Period End Closing Activities

a. Income Received in Advance

Any billing done on income during an accounting period in respect of which service in full

or part will be rendered after the closure of the accounting period, the income part not

belonging to the accounting period will be treated as “Advance Income” to be transferred

as income in the relevant accounting period. Billing system to give the details of such

advance income (separately for each Type, SSA-wise) invoiced until the end of the

period. Accounting entry for period closure will be done by Debiting Revenue accounts

(for each Type, SSA-wise) and crediting “Advance income not earned “.

On 31st March before period closure Manual Entry will be passed based on report from billing : Revenue account head (e.g Fixed call charges) Dr. To Advance income (relevant application head e.g telephone) On 1st April in next year above entry will be reversed manually as income booked in advance is revenue for this current year

Advance income (relevant application head e.g telephone) Dr. TO Revenue account head (e.g Fixed call charges)

Let us consider a scenario where advance rental is charged for a year. The invoice would

look like:

Customer Invoice

Advance Rental from subscriber for the full year i.e. Dec‟09 to Nov‟10. 1200 Add Service Tax 144 Education Cess 3 Higher Education Cess 1 Grand Total 1348

The accounting entries would be as depicted below:

1110101 Sundry Debtors A/c Dr. 1200 1110901 Service Tax Recoverable Dr. 144 1110906 Education Cess Recoverable Dr. 3 1110909 Higher Ed Cess Recoverable Dr. 1 To 1310101 Fixed Charges from Customer 1200 To 1192301 Service Tax Payable 144 To 1192306 Education Cess Payable 3 To 1192309 Higher Ed Cess Payable 1

On receipt of collection from PMS, the Billing would give the payment settlement feed

based on which the following accounting entries would be generated:

TR Collection/Remittance accounts as the case may be Dr. 1348 To 1110101Sundry Debtors 1200 To 1110901 Service Tax Recoverable 144 To 1110906 Ed Cess Recoverable 3

To 1110909 Higher Ed Cess Recoverable 1


NATFM,HYDERABAD 57

At year end On 31st March before period closure following Manual Entry will be passed

based on report from billing :

1310101 Fixed Charges from customer Dr. 800 To 1191701 Income Received in advance 800

b. Accrued Income

Revenue billed during an accounting period for which actual service was rendered in a previous

period, will be assessed and accounted for in the accounts of the relevant previous period as

“Revenue Accrued”. Billing system shall provide the details of such accrued income (separately for

each SSA-wise) un-invoiced till the end of the period.

On 31st March before period closure below Entry will be posted through feed file from billing :

Revenue Accrued (relevant type e.g Telephone) Dr.

To Revenue account head (e.g Fixed call charges)

On 1st April in next year above entry will be reversed manually.

Revenue account head (e.g Fixed call charges) Dr.

To Revenue Accrued (relevant type e.g Telephone)

Following are typical entries that would be done manually for accrued income booking:

1131001 Revenue Accrued-Telephones Dr. 1000

To 1310201 Local call charges 500

To 1300202 STD Charges 500

These entries would have to be manually reversed on the first day of the next year.

c. Interest on Deposit (Fiscal year end)

Security Deposit:

Interest is only posted to Security deposits with account category PT (PCO related deposits).

The interest on deposit amount would be computed and applied as adjustment in the bill of the

customer, depending upon the bill cycle.

As far as interest accounting approach in BSNL is concerned.

a. Interest computations and its incorporation in to books would always be done by debiting the

Interest (Expenditure) head and Crediting the „Interest Accrued on..‟ (Liability head).

b. The setting off of interest against recoverable dues will always operate the „Interest Accrued

on..” head only.


NATFM,HYDERABAD 58

c. The above approach is applicable for computation of interest irrespective of the point at which

it is computed like bill-cycle, calendar month, annual etc.

When Interest is calculated and posted in system, following are the entries:

1950805 Interests on PCO Deposits Dr

To 1191306 Interest Accrued on PCO Deposits

When outstanding balance is settled

1191306 Interest Accrued on PCO Deposits Dr

To Sundry Debtors

To Service tax payable

To EC Payable

To HEC Payable

d. Accrued Interest on Deposit

The interest for the PCO deposits (security deposit type) for which billing cycle date falls later than

31st March & whose interest is to be calculated at their respective billing cycle date after the close of

the financial year , then in that case the interest accrued is calculated for the period up to 31st March

& the report is given to the accounting on the basis of which the following accounting entry is passed

On 31st March before period closure Manual Entry will be passed

1950805 Interests on PCO Deposits Dr

1191306 To Interest Accrued on PCO Deposits

On 1st April in next year the above entry would be reversed 1191306 Interest Accrued on PCO Deposits Dr. 1950805 To Interests on PCO Deposits Voluntary Deposit: As the interest on deposit amount would be computed and applied as adjustment in the bill of the

customer depending upon the bill cycle, the treatment of the same is as follows:

When Interest is calculated and posted in system

1950804 Interests on Voluntary Deposits a/c Dr

To 1191307 Interests Accrued on Voluntary Deposits

When outstanding balance is settled

1191307 Interests Accrued on Voluntary Deposits

To Sundry Debtors etc.

The interest for those Voluntary deposits who‟s billing cycle date falls later than 31st March & whose

interest is to be calculated at their respective billing cycle date after the close of the financial year i.e.

31st March is to be calculated for the period up to 31

st March & the report to be given to the

accounting on the base of which the following accounting entry would be required to pass manually;

1950804 Interests on Voluntary Deposits Dr

1191307To Interest Accrued on Voluntary Deposits

The above entry would be reversed on the next day i.e. on the 1st April of the next year.


NATFM,HYDERABAD 59

1191307 Interests Accrued on Voluntary Deposits Dr

1950804 To Interests on Voluntary Deposits

Interest on Deposit not provisioned :

The interest on application deposit is to be dealt with as follows .

a. The interest due on the pre-connection deposits migrated as per the Waiting List will be

computed by each SSA for the period up to last day of the previous financial year (31 Mar)

b. This amount will be brought into the CDR system as opening balance on interest accrued on

pre-connection deposits. This is one of the OB GL codes (1191399)

c. When connections from the waiting list are given through the CDR system, it will compute the

total interest due on the deposit from the date of payment of deposit to the date of service

provisioning. It will deduct the interest accrued as already available to the credit of the waiting

list account from this total interest amount. For the balance amount, the following journal entry

will get passed.

1950806 Interests on Pre Connection Deposits Others a/c Dr

To 1191399 Interest accrued on Pre-connection Deposits Others

Note: The GL code for others is used since in the CDR system a common GL code (1191100

advance from customers) is used for application deposits.

d. The interest to the extent feasible will get set off against the first bill issued to the customer by

debit to the “Interest Accrued on pre-connection deposits Others”.

e. At the close of each post-migration financial year, the CDR system will compute the total

interest due on the deposits pending as on 31 March of the year on account of non-

provisioning of the service. The amount already credited as accrued interest will be deducted

from this total interest due as computed and the net amount will be accounted for in the

system by passing the following journal entry.

1950806 Interests on Pre Connection Deposits Others a/c Dr

To 1191399 Interest accrued on Pre-connection Deposits Others

The treatment of interest accounting for post-connection deposits and pre-connection

deposits are different. In relation to post-connection deposits, interest is available only

for special cases like PCO deposits and Voluntary deposits. There can be two

approaches to computation of interest in such cases.

a. Compute the interest on calendar month basis.

In this case there will be no year-end special entries. The interest will be computed

on the last day of each month and entries will be passed debiting „Interest on ...‟ and

crediting „Accrued interest...‟. In this case there will be no reversals also.

b. Interest is computed on a bill-cycle basis.


NATFM,HYDERABAD 60

In this case interest is computed based on the bill-cycle, at the point of generation of

the invoices. Taking an example, if bill-cycle is 16 Mar 2010 to 15 Apr 2010 and bills

are generated on 20 Apr, the interest for the period 16 Mar 2010 to 31 Mar 2010 will

get computed on 20 Apr 2010. On this date, a journal entry will be passed debiting

Interest expenditure and crediting „Accrued interest..‟. This happens in the FY 2010-

2011. But the interest burden for the period 16 Mar 2010 to 31 Mar 2010 should

have been borne by FY 2009-2010. To take care of this, a journal entry is passed

(year end entry) on 31 Mar 2010 for the interest liability for the period from 16 Mar

2010 to 31 Mar 2010 by debiting expenditure and crediting liability in the FY 2009-

2010.

Now let us assume the interest amount is Rs.125/- for the period from 16 Mar 2010

to 31 Mar 2010 and that the interest that would get computed as per bill-cycle interest

computation configured in the system for the period 16 Mar 2010 to 15 Apr 2010 is

Rs.200/-.

As per the proposal above, on 31 Mar 2010 entries as follows will get passed.

Interest Dr 125

To Accrued interest Cr 125

The expenditure is borne by FY 2009-2010.

Since the interest computation configuration is not fiddled with, irrespective of the fact

that interest for a part of the bill-cycle was taken care of in the previous FY, the billing

system will compute interest again for the full bill-cycle. This is the reason why we

have to reverse the entries on 01 Apr 2010.

On 20 Apr 2010 entries will be created as follows:

Interest Dr 200

To Accrued interest Cr 200

The net expenditure is borne by FY 2010-2011.

Now the accounts will have balances as follows:

INTERES ACCOUNT (P&L Item)

Date Description Amount

(Dr) Date Description

Amount

(Cr)

31 Mar 10 To Accrued Interest

125.00 31 Mar 10

By P & L Account 125.00

ACCOUNT CLOSED BY TRANSFER TO PROFIT AND LOSS ACCOUNT

20 Apr 10 To Accrued Interest

200.00 By Accrued Interest

125.00

By Balance 75.00

200.00 200.00


NATFM,HYDERABAD 61

ACCRUED INTEREST ACCOUNT (Balance Sheet Item)

Date Description Amount

(Dr) Date Description

Amount (Cr)

01 Apr 10 To Interest 125.00 31 Mar 10

By Interest 125.00

To Balance 200.00 20 Apr

10 By Interest 200.00

325.00 325.00

It may be seen from the above that by carrying out the reversal we have been able to achieve the following. a. The interest expenditure of Rs.125 is borne by FY 2009-1010.

b. The net interest expenditure of only Rs.75.00 is borne by FY 2010-2011.

c. The system configuration for bill-cycle based interest computation is undisturbed.

d. The customer gets a total interest of Rs. 200/- which is his right due.

For application deposits, interest is calculated only annually.

NO reversal is applicable for application deposits. The calculations are done each year until

the service is provided.

In relation to working connection deposits for which accrued interest is computed on 31 Mar,

the reversal is done on 1 Apr. The entries and reversals are manual operations. The person

making the entry has to ensure that reversal is done only for accrued interest applicable for

post-connection deposits for which interest computation is done on the basis of bill cycle and

also that amount reversed is right.

15.Refunds: Following heads are operated with regard to refunds and adjustments:

1193001- Refund on excess/double payments 1193002- Refund due on closed connections. 1193003 – „Refunds due on working connections‟ 1193004 – „Refunds due on pre-connection deposits and advances‟

Refund on excess/double payments: The excess payments are posted to this GL code and will, in the normal course, only get set

off against future bills to be issued to the customer. No cash (which includes cash

equivalents like cheque etc) refunds will operate on this GL code.

All refunds done otherwise than through adjustment in future bills will need a sanction to be

issued by the competent authority. The sanction/ or the approval for refund conveyed

through the system (CRM module) will pass an accounting entry debiting the 'Refunds due

on Excess..etc. and crediting 'Refunds due on working connections'. As the basic concept is

that the AO (Cash) will operate TRC settlement Account head only for all transactions

passing through the Cash/Bank book related to TR operations, when the cheque is issued,


NATFM,HYDERABAD 62

the cash book entry will be 'TRC settlement account' Dr to Bank. The fact of the issuance of

the cheque will be required to be entered by the cheque issuing authority in the CDR

system. The CDR system will convert this into a journal entry debiting' Refunds due on

working connections' by credit to 'TRC settlement account'. When the trial balances from the

CDR system and the EFS are merged, TRC settlement account will get a zero balance.

Refund due on working Connections :

Sometimes the customer is active and he disconnects some add-on services .In such cases the

customer seeks to have some refundable amount to be paid to him rather than being adjusted against

future invoices. Following will be the accounting entry for this:

Relevant deposit/income head Dr

To Refund due on working connections

On issue of sanction & feeding of Cheque details in PMS:

Refund due on working Connections Dr. 1193003

To TR Settlement 1194501

Refund due on closed connections:

In relation to closed connections, the account finalization will look into all un-billed charges,

adjustments, deposits (dealt with as advance payments in the CDR system) including Credit

Vouchers Pending for invoicing, Debit Vouchers Pending for invoicing, Refunds on Excess

Double payments etc and finalize the accounts. If any amounts become refundable, this will

be moved to 'Refunds due on closed/surrendered services' by debiting the heads of original

booking as mentioned above. This is effectively the 'refund approval' for closed accounts.

Beyond this, the refunds/entries will happen as mentioned for Excess payments with

necessary changes in the GL codes being operated.

Refunds due on pre-connection deposits and advances:

There is a third GL code for 'Refunds due on pre-connections deposits' meant for

applications payment refunds involving cancellation of demand notes.

The amount from Excess Payment head does not get moved directly to the 'TRC

settlement account'. The sanction moves it to one of the below mentioned three

heads. The actual issuance of cheque and its entry in the system will only move it

from these heads to the credit of TRC Settlement Account. This is done so to enable

us track the cases of sanctions issued and refund cheques not issued.


NATFM,HYDERABAD 63

The amount moved to the following three refund heads will not be available for adjustment

against future bills.

1. Refunds due on working connections

2. Refunds due on closed/surrendered connections

3. Refunds due on pre-connection deposits (on account of cancellation of demand

and dealt with as advance payments in the CDR system).

In all other cases the amount will be available for adjustment against future bills unless and

until it gets moved into one of the above three heads depending upon the type of refunds

done. The booking under application deposit (advance payment) will be available for

adjustment beyond the provisioning of the service sought.

16. Accounting treatment for OYT rebate in CDR System

The calculation of rebates, refund amount and other related adjustments will be done by the Billing

system and accounting system will post the entries based on the feed from the billing system.

Following are some of the features of OYT deposit :

This deposit would be a non-interest bearing deposit applicable to existing customers only.

Rebate and administrative (accounting) charges are applied on monthly basis and the

available OYT deposit would be reduced based on feed from Billing system.

At the time of closure , the OYT deposit available would be completely refunded to the

customer.

No new OYT deposits will be collected .

„1310102 - Share of Fixed Charge Transferred from OYT Deposits‟ is an existing head under

„INCOME FROM SERVICES - TELEPHONES (OTHER THAN RURAL)‟. This is an Income

(Final) head and not a suspense head. Ideally we are not expecting any debit under this GL Code.

As per the original concept of the OYT deposit operation, billing to the customer is expected to be

done only for the net amount. At the close of the year, we were expected to compute the amount of

OYT deposit that was actually due for adjustment against bills and transfer the sum from OYT

Deposit to the GL code „Share of Fixed Charge Transferred‟.

But after the introduction of Service Tax, we are expected to do the fixed charge billing for the full

amount (and compute ST on it) and set off the OYT rebate against it. As such the GL code „1310102

„ becomes impossible to be operated as originally conceived.


NATFM,HYDERABAD 64

In the CDR system, the process is that irrespective of the bill cycle, it computes the OYT rebate

applicable for each calendar month (and parks that amount under GL code „1310102‟). When actual

billing is done income is booked for the full fixed charges and to the extent of OYT rebate, amount is

transferred from „1310102‟ to the credit of „Sundry Debtors‟ etc.

Posting Adjustments from billing feeds

Let us assume the following example:

Monthly Rental Rs.180

OYT Deposits Rs.15000

Rebate @ Rs.4 per thousand rupees per month for Rs.15000 = Rs.60

Rental payable by the subscriber (180-60) Rs.120

For accounting of the OYT rebate, the following entries would be passed;

On 1st

of every month

1192701 OYT Deposit (After Connection) Dr 60

To 1310102 Share of Fixed Charge transferred from OYT Deposit Cr 60

o When Rebate is adjusted against outstanding balance

1310102 Share of Fixed Charge transferred from OYT Deposit Dr 60

To 1110101 Sundry debtors 54.40

To 1110901 Service tax recoverable 5.45

To 1110906 EC Recoverable 0.10

To 1110909 HEC Recoverable 0.05

For adjusting the Accounting Charges – billing will calculate accounting charges based on

agreed rate and post the same on 1st

of every month.

Accounting charges are to be adjusted and appropriate entry need to be posted

1192701 OYT Deposit (After Connection) Dr 2.50

To 1410199 Other Receipts Cr 2.50

17. Implementing Bundled PC EMI solution in the CDR system

The salient features of this scheme is available in C.O. circular No: 64-35/2009-Broadband

Dated 09-11-2009.

The accounting procedure is as follow:

“Let us assume that the total cost of the HCL bundled PC is 24,000. Upfront amount is 6000 and 12

instalments of 1500 each.”


NATFM,HYDERABAD 65

The upfront payment is not raised, received or accounted for in the CDR system. The

CDR system will deal with the case as if the total price of the equipment is Rs. 18000/- to be

recovered in 12 monthly instalments of Rs.1500/- each.

When the bill for the EMI is raised each month the following entries will be passed on to the

accounting system.

1132701 – „EMI for PC/Laptop as PC bundling scheme for Broadband‟ Dr. Rs. 1500.00 To

1193401 – „Payable to PC/Laptop Mfg. for EMI of PC under bundled scheme‟ Rs.1500.00

No sundry debtors are raised here. This is very similar to the way we deal with Deposits

billed through invoices.

When payment is done, it would come through the PMS which only understands the total

invoice amount and not its classification.

The Accounting Entry for daily list entered in the PMS will be as usual. Assuming online

counter payment, it would be as follows:

Claims Recoverable on online payments Dr. Rs. 1500.00 To TR Collections Rs.1500/-

There will be no change on further activities regarding the collection and its accounting in the

cash book.

When the payment gets posted in the Billing system, to the extent of EMI included in the bill,

the accounting will be as follows:

TR Collections Dr. Rs.1500

To

1132701 – „EMI for PC/Laptop as PC bundling scheme for Broadband‟ Dr. Rs. 1500.00

The difference between the bookings under 1193401 and 1132701 (1193401 is expected to

have a balance equal or greater than the balance under 1132701) represents the EMI

collected and not sent to the hardware supplier.

When the EMI amount is transferred to the hardware supplier, a cheque is issued by the AO

(Cash). As a rule, the AO cash will operate only one GL code for all TR related payments

and receipts. So cheque issuance will be captured in the EFS (Cash/Bank book) as

TRC Settlement Account Dr Rs.1500/- To

Bank Rs.1500/- (In fact there is Re.1/- commission BSNL can claim on each EMI which is ignored since the

complications it would create is not worth the efforts involved. Some solution to deal with it

outside the CDR system will have to be thought of if BSNL is really interested in that Re.1/-)


NATFM,HYDERABAD 66

The information on cheque issued will be input in to the CDR system. The result would be as

follows.

1193401 – „Payable to PC/Laptop Mfg. for EMI of PC under bundled scheme‟

Rs.1500.00 To TRC Settlement Account Rs.1500/-

At the end of the accounting month/year the balance under GL Codes 1193401 and

1132701 should be equal in theory. Any difference should be a higher amount under

1193401 indicating collections received and not transferred to the hardware supplier. Since

actual cheque for March will get issued in the month of April, there will be a higher amount

under 1193401 as on 31 March. For instance if the net balance 1132701 is Rs.30000/- and

that under 1193401 is Rs. 40000/-, the difference of Rs.10000/- will go into the Balance

Sheet under „Current Liabilities‟.

The amount collected and not settled will be the balance. The collection is already in the

Current Asset and Cash/Bank balance. What is required is a corresponding figure on the

Liability side of the Balance Sheet indicating that the collection does not really belong to

BSNL.

GL Cod 1132701 cannot have a balance in excess of the balance under GL Code 1193401.

The term „after adjusting‟ used in the above para would not mean that a journal entry be

passed for adjustment. It should only imply that the effective balance only would be brought

into the balance sheet. The balances under GL Codes 1193401 and 113270 will get carried

over without any change into the books of the next financial year.

“If the customer disconnects his BB before the 12 instalments are over, whether the pending instalments will be cancelled ?”

The balance will be cleared from the debit of the customer accounts. A journal feed will be

given debiting 1193401 and crediting 1132701 to clear it from the suspense heads.

“Whether during account settlement total outstanding against that account is

to be considered for write off ?” There will be no „write off‟ in this case. Write off will apply only in relation to BSNL

income. This is not BSNL income and is not considered or accounted as part of Sundry Debtors.

18. Migration Strategy:

Accounting is done in the CDR system based on actual details. These details are

sitting in the collaborating modules forming part of the CDR system. These are primarily the

Billing and PMS modules. As far as opening balance is concerned, the details are expected


NATFM,HYDERABAD 67

to be available in the billing system alone since PMS starts its operation from the „go live‟

date only. This would mean that unless billing system is populated with the required data,

the accounting system cannot create the opening balance. In short there can be no opening

balance creation without completing data migration.

The strategy we are following for financial data migration is that all transactions that

occur prior to the „go live‟ date must get incorporated in the source billing system to arrive at

the closing balance in the source system and all transactions taking place from the „go live‟

date will be dealt with in the CDR system. The „go live‟ date is the date on which the

Payment Management System (PMS) deals with its first transaction. The closing balance in

the source billing system is to be taken as the OB in the CDR based system. In the event of

migration happening between the first and last day of a month, the sub-ledger and therefore

accounting for the first month will take place for parts of the month in each of these systems.

Opening balance will be created only for the 15 or so GL codes that are part of the Balance

Sheet items of the company. P & L related GL codes will be dealt with separately in each of

these systems for the related periods. Balances on these are not brought over to the CDR

system.

Let us now take the case of Sundry Debtors (LL) as an example and understand the

situation.

We are dealing with multiple balances in the various systems. These are:

a. A balance shown in the books of the SSA (We have named it as the External Financial System

or EFS with reference to the CDR system).

b. The sum of customer-wise balance sitting in the existing billing systems.

c. The sum of customer-wise balance extracted for migration from the source billing system.

d. The sum of customer-wise balance loaded into the CDR system.

Now, the situation obtaining could be something as follows:

i) There are substantial differences between (a) and (b). This is the result of the

accumulated errors and inconsistencies in the operation of the legacy systems.

ii) There can be a difference between (b) and (c) too since some sort of purifications are

carried out in the process of migration. For instance, we may not migrate the invoices in which

surcharge alone is outstanding. Also we may ignore invoices with less than Rs.10/- outstanding. In

other words the differences can arise on account of the policy we have adopted in doing financial data

migration.

There can also be differences between (b) and (c) on account of data extraction errors. Some

invoices fail to get extracted on account of errors in the extraction application or on account of data


NATFM,HYDERABAD 68

errors etc. Such errors are expected to be cleared before the final data extraction for migration is

carried out. If there is a failure on this, it will lead to extra difference between (b) and (c).

iii) Ideally, there should be no difference between (c) and (d). But in reality there may be

mistakes that occur during data transformation or data loading. Thus there may be a difference. This

difference too is unacceptable and should be cleared before final data transformation and loading

takes place in order to ensure that all the data extracted get loaded rightly into the CDR system.

So the correct after-migration situation would be that we have invoices in the CDR system that are

expected to be there as per the migration policy we are following. We have to reconcile the balances

between the data extracted and data in the source billing system. The difference will be explained by

the migration policy. The next reconciliation is between balances extracted and balances finally found

in the CDR system. There should be no difference between the two at the aggregate level. But there

may be differences at lower level classifications. For instance the balances under Sundry Debtors LL

and Sundry Debtors BB as arrived at from the extracted data and loaded data may differ on account

of difference in allocation policy followed in relation to partially paid invoices by existing and target

systems.

Now what we have at the point of the completion of (first stage) migration is only provisional

balances. This is on account of the payments that remained in the pipeline as on the „go live‟

date. These payments have to get incorporated into the provisional balance for arriving at the final

closing/opening balances. The process is what we have been calling the „delta‟ migration. Ideally all

payments relating to the period prior to the go live date and reaching us subsequent to the date of

„data cut‟ (the date on which database export is taken) will have to be processed through the source

billing system also. This is because we have to process the sub-ledger for the period up to the „go

live‟ date in the source billing system.

Once delta migration is completed, the final balances based on actual data migrated and sitting in the

CDR system with all transactions for the period up to the date of „go live‟ incorporated into it will

provide the figures required to create the OB in the CDR system. It is expected that a journal feed on

this will go from the billing system to the accounting system. The OB will now be frozen.

The OB arrived at in the CDR and the balances in the source as per data migrated may have some

minor differences as already explained above. There may be differences at lower level classifications.

For instance the balances under Sundry Debtors LL and Sundry Debtors BB as arrived at from the

extracted data and loaded data may differ on account of difference in allocation policy followed in

relation to partially paid invoices by existing and target systems. The difference arises as a result of

surcharge considered in target due to expiry of pay by date at the time of migration whereas in source

it might not have been considered. In such case it needs to be accounted for in source to agree with

target. Conversely the Source system might have considered surcharge even though not due at the

time of SLR run for the period upto date of data-cut but the same might not have been migrated to

the target CDR system.


NATFM,HYDERABAD 69

There may be differences in service tax also . These differences need to be handled with one time Journal entry in source as follow:

Details LL SC BB Tax Total

A Source invoice 10000 300 5000 1500 16800

B

Paid &

allocated in source

8000 300 800 9100

A-

B

Balance in

source 2000 0 5000 700 7700

C

Payment

allocated as per target

5579 2708 813 9100

D Balance as per Target

4721 2292 687 7700

(A-B)-D

Difference

between source & target

-2721 2708 13 0

Journal entry required in source: Dr Cr

Sundry Debtor (LL) 2721

To Sundry Debtor BB 2708

To Service tax recoverable 13

The difference arising out of non-migration of certain data as per migration policy needs to

be reconciled separately. The above treatment is only for the source data actually migrated

and there are differences due to partial payment at source and different payment allocation

policy across systems.

19. Revised Strategy for Financial data/Delta payment Migration(with effect from 01/10/2010): Introduction:

A standard approach to deal with migration of financial data from the existing SSA

level systems to the CDR based billing and customer care system was devised earlier,

keeping in mind a strategy that will enable „any day‟ migration. This strategy has evolved

taking into account the views of teams involved from both BSNL and TCS. Under this

strategy, normally delta payment data is expected to be provided to migration team within

10-15 days of a SSA going live on CDR. Adherence to this policy is critical due to its impacts

on future SLR, bill runs and accounting data updates.

Assuming a tax rate of 10% & total outstanding of Rs 16,800


NATFM,HYDERABAD 70

However, post go-live, some major issues are observed as noted below since majority

of the SSAs are not adhering to the guidelines; They are:

Wrong disconnections due to non-updation of delta payments in time.

Delay in generation of SLR.

Delay in sending opening balance feed to accounting system

Delay in Bill generation in target system pending updation of delta payments.

In case of abnormal delay in updating the delta payment, bill generation

happens in target system without posting of delta payments .As a result, some

times it so happens that the delta payment gets allocated to target generated

invoices. It makes the task of arriving at the correct opening balance very

difficult.

In some cases SLRs in target system are generated and after that delta is

provided by SSA. In such a case there will be a mismatch in this month closing

balance and next month opening balance due to the delayed delta posting.

In order to avoid delay and simplify the process, it has been decided to implement a revised approach in dealing with delta payments in the Financial data migration.

Definitions: Delta payment is that payment received in source system after data-cut either in online or offline relating to the period prior to Go-live Date.

Source System is the SSA level systems currently managing the operations and data that

are being migrated to the CDR based customer care and billing system.

Data Cut is the activity of extracting the data required in the target system for enabling its

operations, from the source system.

Cutover Date is the date on which the „data cut‟ is taken for the last time from the source

system for being loaded into the target system.

Cutover Data is the data that is extracted from the source system on the cutover date and

loaded into the target system.

Go Live Date is the date on which CDR system is opened for operation either fully or

partially to the SSA level users. Payment Management System (PMS) is the first module

going live from the target system.

Target System is the CDR based Customer Care and Billing System (Operation Support

System/Business Support System ) being implemented to replace the „Source System‟.


NATFM,HYDERABAD 71

Revised Migration Strategy: 1. All bi-Monthly Customers, whose billing cycle ends on the last day of the „go

live‟ month, will be issued a single month‟s Bill from the source system for the

period up to the end of the month immediately preceding the „go live‟ month.

Data Cut will be taken only after these bills are issued. For instance,

assuming that „go live‟ date is „any day‟ in September 2010, bi-monthly

customers whose bill cycle covers the period from 01 Aug 2010 to 30 Sep

2010, will be issued a bill for the period from 01 Aug 2010 to 31 Aug 2010.

These customers will be issued another monthly bill for the month of Sep

2010 from the target system. Beyond this, the customer will receive bi-

monthly bills as usual from the target system. In order to avoid hardships to

the customers on account of this change, the pay by date related to the

monthly bills issued to bi-monthly customers may be suitably extended.

When the second monthly bills are issued to the customers from the CDR

system, following the „balance carry forward‟ approach, all previous

outstanding will also get included in it. Any notice to be issued to the

customer to communicate this interim change in billing schedule will be taken

care of by the SSA concerned

2. All online counters in the source system will be temporarily stopped from

accepting payments before data-cut is taken. This activity can take place

during night/closed hours or on a holiday.

3. All online counters will be finally processed and payments updated in the

source billing system.

4. Data-cut will be taken immediately on updation of online payments in the

source billing system. The data-cut should take care of the complete data in

source including deposits (at refundable value), unbilled deposits, unbilled

debits, unbilled credits, accrued interests ,accrued income, advance income,

etc.

5. A Sub-ledger (source-SLR-I) for the period upto the end of the previous

month of Go-live will be generated in source system after data-cut.

6. Another Sub-ledger (Source-SLR-II) for the partial month from first of the go-

live month to the date of data-cut will be processed in source in succession.

7. Once the above two sub-Ledgers are processed , the online counters of the

source system will be allowed to accept normal invoice payments till such

time PMS (Payment management System ) starts operation in the CDR

system within a day or two. No transactions other than payment acceptance

on invoices issued from the source system will be permitted in the source


NATFM,HYDERABAD 72

system beyond the point of „data cut‟. However sales transactions that have

no impact on „cut over data‟ can continue.

8. After cut-over, the online counters of source system will merely function as

offline collection channel for acceptance of payments from the customers

across the counters (online) till PMS goes LIVE .

9. Demand Note Payments are not expected in the source system beyond the

„cutover date‟. However, any demand note in the pipeline as at the point of

„data cut‟ and coming into the source system after the „data cut‟ will need to

be re-issued from the target system.

10. Payments, during the delta period, which involves the restoration of service

under suspension for non-payment of dues, shall be managed by the source

system.

11. All online counters in the source system will be stopped and PMS system in

the target will start operations.

12. All normal payments (excluding delta payments) will be accepted through

PMS.

13. A summary report from source billing system will be generated by the SSA

(Annexure-IA). A similar statement from cut-over data(before transformation)

will be generated by the migration team(Annexure-IB). Normally there should

not be any difference between these two. However SSA needs to be

convinced for the difference, if any, between these two reports by the

migration team by making a reconciliation.

14. Cutover data will be transformed and uploaded into the target billing system.

15. Migration/billing team will generate an account head-wise (GL Codewise)

provisional statement both from cutover data and data uploaded into the

target billing system(Annexure-II) . A reconciliation of these two statements

will be carried out immediately. Mostly there may be differences only in

sundry debtors, service tax & surcharge and that too due to the migration

policy and change in payment allocation logic in the target system. This

difference needs to be explained to the SSA by migration team. (Invoices

prior to 1.4.97, invoices of MSC WLL, invoices having only surcharge as

outstanding etc. are not migrated as per the migration policy. For partially

paid invoices, due to different allocation logic of payments in the target, there

may be internal difference between debtors and service tax as compared to

source and target but the total of Debtors(LL including surcharge+BB) and

service tax as per uploaded data in the target should match with the

corresponding invoices in cutover data). The complete details of invoices


NATFM,HYDERABAD 73

migrated has to be provided by the migration team showing the details as per

source and target in a text dump (preferably pipe separated text file, since

SSAs find it difficult to handle the dump presently being provided). This has to

be in the format given in Annexure-III.

16. Once the above provisional reconciliation is done, the delta payments

including the online payments in the source accepted after data cut, will be

dealt with through a separate sub-channel in the target system.

17. A separate franchisee (collection sub channel) namely „Delta„ will be

configured in PMS under the dummy channel „Others „ which is specific to

delta data.

18. All delta payments will be posted by SSA in PMS under this franchisee „delta‟

sub-channel only. SSAs will take extra care not to post the normal payments

relating to the period on or after go-live date in this delta sub-channel.

Migration/PMS team need to extend the support to SSA in preparation of the

structured files for uploading in delta channel. SSAs should take care not to

make any duplicate entries in delta channel and system will not take care of

this aspect. SSAs should also take care not to enter payments to wrong

accounts or incorrect payments. SSAs will not make any schedule entry in

delta channel and migration team may emphasize this point to SSAs.

19. These delta payments will be processed in target system as normal payment.

20. These delta payments should not be updated in source system since it

technically stands closed from the time “data cut” is initiated .

21. All delta payments will be entered into the PMS with ACTUAL DATE OF

TRANSACTION . Books will be opened for the migration month AND ONE

previous month in the CDR system to take care of any delayed payment .(In

other words the go-live date will be temporarily shifted to first of the

previous month called „temporary go-live date‟). It would be the

responsibility of the SSA to ensure that all payments related to earlier periods

are accounted for before data cut is taken. For instance, if migration is done

in July with „go live‟ on 12 July 2010, the books of June 2010 too will be

opened. PMS will accept payment belonging to June 2010. But it WILL NOT

accept payment related to a period prior to 01 June 2010 UNDER ANY

CIRCUMSTANCES.

22. The SSA will have 15 days from the date of „go live‟ to identify and bring all

payments related to the period up to „go live‟ date into the PMS. The SSA

has to furnish a confirmation to the effect that all such payments have been

accounted for. The SSA will also furnish the details of cheques dishonoured


NATFM,HYDERABAD 74

prior to data-cut but not reversed in source prior to data cut within 15 days

from the date of „Go-live‟.

23. The balances of the migrated invoices in the target billing system will be

manually corrected by the migration team for such cheque dishonour cases.

The source SLR-I/II closing outstanding balances will be manually increased

to the extent of cheque dishonour. No manual correction of migrated invoices

in target will happen if the cheque dishonour relates to delta payments.

Instead such cheque dishonour cases will be posted in PMS through delta

sub-channel.

24. The first bill run to happen in Target system only after receiving confirmation

from the SSAs to the effect that all delta payments have been posted.

Migration team should also confirm that the balances of migrated invoices

have been manually corrected in respect of cheque dishonour cases..

25. Once confirmed, a sub-ledger (Target-SLR-I) will be generated from the

target CDR system by the billing/migration team for the previous month to

cover the delta payments of previous month. This SLR will have only the delta

payments relating to the previous month and no billed invoice details (already

available in Source-SLR-I) will appear in this target-SLR-I.

26. Source-SLR-I and target-SLR-I when clubbed gives the full sub-ledger for the

previous month .In other words the delta payments figuring in Target-SLR-I

for the previous month will be reduced from the outstanding balance in

Source-SLR-I. This way the complete payments of the previous month is

taken into the relevant SLR of that month.

27. The opening balance of Source-SLR-II (from first to Go-live date) will be

corrected to the extent of closing balance arrived at in the full Sub-ledger for

the previous month as above.

28. The SSA has also to furnish the left over details ,if any, to the migration team

well in time so that they can update all these details in target billing system

before SLR for the go-live month is generated from target system. This should

be completed not later than 20th of the next month from Go-live month.

29. The Sub Ledger (Target SLR-II) for the „go live‟ month for the period from the

„go live‟ date to the end of the month will be processed in the CDR system by

23rd of the next month.

30. The full Sub Ledger for the „go live‟ month will be compiled by combining the

Source-SLR-II and target-SLR-II.

31. No schedule entries will be required for daily lists belonging to the period prior

to „go live‟ date.


NATFM,HYDERABAD 75

32. In case of a schedule which overlaps the Go Live date (schedule has

collection details for the period before Go Live date and after Go Live date),

SSA will bifurcate it into two different schedules, first having the pre-go-live

collection details, which need not be posted in the „delta‟ sub channel of the

target system and second having the post-go-live collection details, which will

be posted in the normal channel of the target system.

33. On receipt of the confirmation from SSA on completion of all delta payments

in to the CDR system, the daily lists for the period concerned will be marked

as „schedule entry completed‟ in the CDR system by the PMS team.

34. In order avoid feeding any further payments with pre-go-live date, the

„temporary go-live date‟ will be changed to the actual „go-live date‟ in the

system.

35. A summary report of payments fed through delta sub-channel (including

cheque reversals) will be generated from PMS by the TCS /O &M team. A

GLcode-wise report for the delta payments(including cheque reversals) fed in

delta sub-channel of PMS will also be generated by migration/billing team

from the billing system. Taking these and the reconciled cut data figures into

consideration, the migrated opening balance will be arrived at as in

annexure-IV.

36. It is not necessary that journal feeds based on the initial data (cut over data)

be sent to the Accounting Module of the CDR system. The data and payment

transactions may remain in the billing system. Reconciliation will be done

based on reports to be generated and provided by TCS from both source and

target billing systems as mentioned above. This will ensure that the data is

reconciled as on the date of go-live.

37. A stage-I reconciliation report (annexure-V) to signoff the Opening Balances

by TCS and BSNL (SSA) will be generated after the „delta migration‟. This

report will present the Opening Balances under the designated GL codes as

on the „go live‟ date. The IFA of the SSA will furnish a certificate duly

signed on the reconciliation of source and target data in the format

given in Annexure-VI.

38. Once the reconciliation reports for the opening balances are created and

signed off by the stake holders, the required journal feed will be given by the

Billing system covering all transactions for the pre-go-live period including the

migrated data. This should take care of the entire migrated data as at the

point of data cut and all the transactions impacting it related to the period up

to the „go live‟ date.


NATFM,HYDERABAD 76

39. The required manual journal entries will be passed at the DC level to take

care of the accounting impact of the non-entry of schedules through the PMS

for the delta payments. The details will be furnished by PMS/migration team

and the accounting team will provide the necessary Journal template. There

will be an accumulated debit against the head „Claims recoverable from

others-Delta Channel‟ for the total amount of delta payments posted through

this Channel and this will be cleared by a manual journal entry in CDR

Accounting system as follow at DC level:

1194501 TR settlement account Dr

To 1132399 Claims recoverable from others-Delta Cr

The settlement cheques for these delta payments will be classified as „TR

settlement account‟ in bank books. All bank/cash receipts accepted through PMS

and CDR related payments made need to be class ified as „TR settlement

account‟ in the cash/bank book in EFS(External financial system) from the day

following data cut. Commission if any , deducted , in the settlement cheque in

respect of delta payments may have to be accounted for in the EFS by the SSA

as follow:

1742701 PO /Other Commissions Dr

1131505 Service Tax(input service) Dr. 1131506 Education Cess Dr. 1131509 Higher Education Cess Dr.

To 1194501 TR settlement account Cr.

40. The balances assembled based on this data by the Accounting module of the

CDR system will furnish the Trial Balance as at the end of the „go live‟ month.

Since the books are opened for one month prior to go-live month, we can also

generate a Trial balance for the previous month which will give an account for

the complete delta transactions accounted for the previous month in the

target-SLR-I. A report on GLcode-wise transactions for the period from Go-

live date to month-end (excluding cutover data) in respect of the OB related

GL codes will be generated from billing by the billing team. The correctness

of opening balance arrived in annexure-IV will be cross-checked as in

annexure-VII.

41. Beyond the „go live‟ month, all linkages with the source system will stand

severed and the entire TR related operations will be performed only through

the CDR system.


NATFM,HYDERABAD 77

42. The SSAs will take care to make necessary journal entries in the

EFS(external Financial System) for all the unbilled(debit/credit vouchers

etc)/unaccounted transactions remained in the source system prior to

migration.

43. The book related to any previous month, opened for delta payment posting ,

will now be closed in accounting system.

44. So far, we have only reconciled the data as per billing system both as per

source and target. If there are differences between EFS trial balance and

source billing system itself , the same needs to be reconciled by the SSAs in

stage-II separately. Differences if any, in deposit heads will be dealt with by

the SSAs as per Corporate office circular No.236 dated 18/08/2010. The

SSAs will operate these heads in circular-236 only in EFS. Accounting

procedure within CDR for handling the difference in deposits will be evolved

separately. The deposit difference heads communicated in circular CA-236 is

detailed in Annexure-VIII.

The SSAs may also please note that the various deposits in source system

are moved and merged in only few heads in the target system. However

individual flagging is kept for STD PT deposit, Voluntary deposit, Broadband

Plan/Modem deposit etc. A deposit mapping in CDR is given in Annexure-IX.

45. Action point-wise listing is provided in annexure-X.


NATFM,HYDERABAD 78

Annexure-IA/IB

Sl.

No. Item Type Count

Amount Billed Bal

Amount Basic

Charges

Service

Tax

Sur

charge Total

1 Invoices

Fully Closed

Partially

closed

Fully Open

Total

2 Credit Vouchers Pending

Instalment

Others

Total

3 Debit Vouchers Pending

Instalment

Others

Total

4

Working

Connection Deposits

Paid deposits

OYT

Security/Tatkal

PT

Voluntary

Total

Billed &

Unpaid deposits

OYT

Security

PT

Voluntary

Total

Unbilled deposits

OYT

Security

PT

Voluntary

Total

5 Application Deposits

6 Accrued interest

PT

Voluntary

Preconn. deposits

7 Refund due on Double/ Excess payments

8 Refund due on closed connections

Note: OYT & Tatkal deposits will be migrated at net refundable value to the subscribers.


NATFM,HYDERABAD 79

Annexure-II Cutover data Target data

Sl.No

.

GL

Code Description

Amt(Dr

)

Amt(Cr

) Amt (Dr) Amt(Cr)

1 111010

1 Sundry Debtors LL

2 111050

9 Sundry Debtors BB

3 111090

1 Tax Recoverable

4 119230

1 Tax Payable

5 119450

4

CDR based Credit Memo

Invoicing account

6 113102

5

CDR based Debit Memo

Invoicing account

7 119300

1

Refund due on double or

excess payment

8 119300

3

Refund due on working

connections

9 119300

2

Refund due on

Closed/Surrendered

connections

10 119110

0

Advance payment recd

from cust.

11 119139

9

Accrued Interest for

application deposit

12 119270

1 OYT Deposits

13 119271

4 Security Deposits

14 119470

1

Security Deposit under

recovery (Billed)

15 113250

1

Security Deposit

recoverable (Billed)

16 119470

1

Security Deposit under

recovery (Un-Billed)


NATFM,HYDERABAD 80

The internal difference between the source & target system will be handled by one time Journal entry in the EFS by the SSA.

Annexure-III

From SOURCE SYSTEM From TARGET

SYSTEM

BILLED

SETTLEMENT (including Payment, Adjustments)

OS Balance OS Balance

UID BILL NO ABF

SERVICE TAX

SUR CHARGE ABF

SERVICE TAX

SUR CHARGE

Last Settle

ment date ABF

SERVICE TAX

SUR CHARGE ABF

SERVICE TAX

SUR CHARGE

G.Total


NATFM,HYDERABAD 81

Annexure-IV Cutover

data

Adjustment

for Chq

reversals

Adjustment

for delta

payments

OB as on

go-live date

Sl.No. GL

Code Description Amt(Dr/Cr) Amt(Dr/Cr)

Amt

(Dr/Cr) Amt(Dr/Cr)

1 1110101 Sundry Debtors LL 2 1110509 Sundry Debtors BB 3 1110901 Tax Recoverable 4 1192301 Tax Payable

5 1194504 CDR based Credit Memo

Invoicing account

6 1131025 CDR based Debit Memo

Invoicing account

7 1193001 Refund due on double or

excess payment

8 1193003 Refund due on working

connections

9 1193002

Refund due on

Closed/Surrendered

connections

10 1191100 Advance payment recd

from cust.

11 1191399 Accrued Interest for

application deposit

12 1192701 OYT Deposits

13 1192714 Security Deposits

14 1194701 Security Deposit under

recovery (Billed)

15 1132501 Security Deposit





NATFM,HYDERABAD 82

Annexure-V

Statement to be attached duly signed with annexure VI:

Sl.No. GL Code Description Amount (Dr) Amount(Cr)

1 1110101 Sundry Debtors LL XX

2 1110509 Sundry Debtors BB XX

3 1110901 Service Tax Recoverable XX

4 1192301 Service Tax Payable XX

5 1194504 CDR based Credit Memo Invoicing account XX

6 1131025 CDR based Debit Memo Invoicing account XX

7 1193001 Refund due on double or excess payment XX

8 1193003 Refund due on working connections XX

9 1193002 Refund due on Closed/Surrendered conns XX

10 1191100 Advance payment received from customer XX

11 1191399 Accrued Interest for application deposit XX

12 1192701 OYT Deposits XX

13 1192714 Security Deposits XX

14 1194701 Security Deposit under recovery (Billed) XX

15 1132501 Security Deposit recoverable (Billed) XX

16 1194701 Security Deposit under recovery (Un-Billed) XX 17 0099999 Migration control account XX (Cr/Dr)

AO / CAO AO/SDE/CAO/DE

(TR – Sub ledger) (Computer)

<SSA> <SSA>


NATFM,HYDERABAD 83

Annexure-VI

Certificate on Stage-1 reconciliation (To be issued by the IFA <SSA> within ONE

month with reference to the „go live‟ date).

Place:

Date:

“Certified that the Stage-1 reconciliation of the financial data between the source

system and the CDR system has been completed by this SSA in accordance with

instructions contained in BSNL Corporate Office Lr.No: 1-16/2009/RA/BSNL

Dated 09.03.2010. Related statements (annexure-V), duly signed by the

competent authorities are attached herewith. These balances have been taken as

provisional Opening Balance as on the „go live‟ date for the Account Codes

concerned. Stage-2 of reconciliation of the financial data between the bookings in

the EFS(External Financial System) Trial Balance and that obtained from the CDR

system will be completed by <date1>. All differences relating to deposits remaining

after Stage-2 reconciliation will be moved to the deposit difference Suspense account

heads on <date2> as per C.O. Circular 236-dated 18/08/2010 and the details of the

same will be furnished to Corporate office. The differences moved to deposit

difference heads will be reconciled and cleared within 6 months as stipulated in

Circular-236.”

IFA <SSA>


NATFM,HYDERABAD 84

Annexure-VII

Balance as

per Trial

balance as

at the end

of go-live-

month

Transactions

between go-

live-date &

month-

end(excluding

cutover data)

OB as on

go-live date

Sl.No. GL

Code Description Amt(Dr/Cr) Amt(Dr/Cr) Amt(Dr/Cr)

1 1110101 Sundry Debtors LL 2 1110509 Sundry Debtors BB 3 1110901 Tax Recoverable 4 1192301 Tax Payable

5 1194504 CDR based Credit Memo

Invoicing account

6 1131025 CDR based Debit Memo

Invoicing account

7 1193001 Refund due on double or

excess payment

8 1193003 Refund due on working

connections

9 1193002

Refund due on

Closed/Surrendered

connections

10 1191100 Advance payment recd

from cust.

11 1191399 Accrued Interest for

application deposit

12 1192701 OYT Deposits



recovery (Billed)






NATFM,HYDERABAD 85

Annexure-VIII (Circular CA-236 dated 18/08/2010) GL--.General Ledger SL--->Subledger EFS-->External Financial System (Non-CDR)

Existing

Account

heads in EFS

New Account heads for the Difference in EFS

If GL>SL If GL<SL

A 1191200 Application Deposits (Before providing service) 1194900 1132800

1191201 OYT Deposits 1194901 1132801

1191202 Non-OYT Deposits 1194902 1132802

1191203 WILL Deposits (NON-MSC) 1194903 1132803

1191205 Tatkal Deposits 1194905 1132805

1191206 Indo Net Deposits 1194906 1132806

1191207 Voice Mail Deposits 1194907 1132807

1191208 Internet Deposits 1194908 1132808

1191209 Radio Paging Deposits 1194909 1132809

1191210 Deposits from STDPT franchisees 1194910 1132810

1191211 Registration charges for free telephones 1194911 1132811

1191212 Deposits from franchisees of Broad Band Services 1194912 1132812

1191213 Voluntary Deposit 1194913 1132813

1191214 Security Deposit 1194914 1132814

1191299 Others 1194999 1132899

B 1192700 After Connection Deposits 1195100 1133000

1192701 OYT Deposits 1195101 1133001

1192702 Non-OYT Deposits 1195102 1133002

1192703 WILL Deposits (NON-MSC) 1195103 1133003

1192705 Tatkal Deposits 1195105 1133005

1192706 Indo Net Deposits 1195106 1133006

1192707 Voice Mail Deposits 1195107 1133007

1192708 Internet Deposits 1195108 1133008

1192709 Radio Paging Deposits 1195109 1133009

1192710 Deposits from STDPT franchisees 1195110 1133010

1192711 Registration charges for free telephones 1195111 1133011

1192712 Security Deposits (refundable) on Broad Band Services 1195112 1133012


1192714 Security Deposits 1195114 1133014

1192799 Others 1195199 1133099

C 1191300 Interest accrued on Application Deposits 1195000 1132900

1191301 OYT Deposits 1195001 1132901

1191302 Non-OYT Deposits 1195002 1132902

1191303 WILL Deposits(NON-MSC) 1195003 1132903

1191305 Tatkal Deposits 1195005 1132905

1191306 STDPT Deposits 1195006 1132906


1191308 Security Deposit 1195008 1132908

1191399 Others 1195099 1132999


NATFM,HYDERABAD 86

Annexure-IX

Deposit Heads in CDR

New

Account Heads

in CDR

Existing

Account heads in

EFS

New

Account Heads

in CDR

Existing

Account heads in

EFS

1191200

Application Deposits

(Before providing service) 1191300

Interest accrued on

Application Deposits

1191100 1191201 OYT Deposits 1191399 1191301 OYT Deposits

1191100 1191202 Non-OYT Deposits 1191399 1191302 Non-OYT Deposits

1191100 1191203 WILL Deposits (NON-MSC)

1191399 1191303 WILL Deposits(NON-MSC)

1191204 Telex Deposits 1191304 Telex Deposits

1191100 1191205 Tatkal Deposits 1191399 1191305 Tatkal Deposits

1191100 1191206 Indo Net Deposits 1191399 1191306 STDPT Deposits

1191100 1191207 Voice Mail Deposits 1191399 1191307 Voluntary Deposit

1191100 1191208 Internet Deposits 1191399 1191308 Security Deposit

1191100 1191209 Radio Paging Deposits 1191399 1191399 Others

1191100 1191210 Deposits from STDPT franchisees

Existing in EFS

New GL in GSM

MSC WLL Deposit codes

(Circular CA-235 dt

16/08/2010)

1191100 1191211 Registration charges for free telephones

4191200

4191200 Deposit received

for CMTS & MSC based CDMA

1191100 1191212 Deposits from franchisees of Broad Band Services

1192703 4191210 4191210 Deposit for MSC based CDMA

1191100 1191213 Voluntary Deposit

4191211 4191211 STD Deposit for

MSC based CDMA


4191212 4191212 ISD Deposit for MSC based CDMA

1191100 1191215 Advance from other operators for POI/Port Charges

4191213 4191213 Roaming Deposit for MSC based CDMA

1191100 1191299 Others

1191100

Advances from Customers-pre-

connection (includes wait list, Voluntary deposit etc from pre-migration period)

Deposit

head in CDR

Interest

head in CDR

Accrued interest head in CDR

1191100 1950806 1191399


NATFM,HYDERABAD 87

Annexure-IX (contd)

New Account

Heads in CDR

Existing Account

heads in EFS

Deposit head in

CDR

Interest head in

CDR

Accrued interest head in CDR

1192700 After Connection Deposits

1192701 1192701 OYT Deposits

1192714 1192702 Non-OYT Deposits

1192714 1192703 WILL Deposits (NON-MSC)

1192704 Telex Deposits

1192705 1192705 Tatkal Deposits

1192714 1192706 Indo Net Deposits

1192714 1192707 Voice Mail Deposits

1192714 1192708 Internet Deposits

1192714 1192709 Radio Paging Deposits

1192710 1192710 Deposits from STDPT

franchisees 1192710 1950805 1191306

1192714 1192711 Registration charges for free telephones

1192714 1192712 Security Deposits (refundable) on Broad Band Services

1191100 1192713 Voluntary Deposit 1191100 1950804 1191307


1192714 1192799 others

1191100 Advance from customers (Existing customers)


NATFM,HYDERABAD 88

Annexure-X

Action points on proposed modified approach on financial data migration/delta payments:

Sl Scope of work Action by

Revised

migration strategy

document para No.

1 Issue of monthly bills to bi-monthly subscribers for the previous month of go-live SSA 1

2 Temporary stoppage of online counters before data-cut& updation of payments SSA 2 &3

3 Taking data-cut TCS 4

4 SLR processing for previous month & current month in source SSA 5 & 6

5 Restoration of services for delta payment cases SSA 10

6 Uploading the data in target & starting PMS operations TCS 11

7 Summary report from source billing system- Annexure-IA SSA 13

8 Summary report from cut-over data - Annexure-IB & reconciliation with annex-IA TCS 13

9 GL Codewise provisional statement both from cutover data and data

uploaded into the target billing system(Annexure-II) TCS 15

10 Configuration of 'delta' sub-channel to accept delta payments in PMS TCS 17

11 Preparation of structured files and uploading of delta payments in delta channel SSA/TCS 18

12 Furnishing details of cheques dishonoured prior to data-cut date but not

reversed in source prior to data cut & manual correction of invoices in target billing system

SSA/TCS 22 & 23

13 Confirmation of delta payments posting & cheque reversal updation before first bill

run SSA/TCS 24

14 Generation of Target-SLR-I from CDR billing system for the month prior to

go-live month. TCS 25

15 Compilation of full SLR for the previous month combining Source-SLR-I & Target-

SLR-I SSA 26

16 Correction of OB of Source-SLR-II w.r.t. combined full SLR for previous month. SSA 27

17 Submission of left over details, if any, by 20th of next month of go-live to migration

team. SSA 28

18 Generation of Target-SLR-II for the go-live month by 23rd of next month of Go-live TCS 29

19 Compilation of full Sub Ledger for the „go live‟ month combining the Source-

SLR-II and target-SLR-II. SSA 30

20 In cases of overlapping, bifurcation of schedules into pre-go-live & post-live and entering schedule only for post-live period.

SSA 31 & 32

21 Confirmation on completion of all delta payments in to the CDR system & marking of batches as „schedule entry completed‟ in the CDR system

SSA/TCS 33

22 Changing temporary go-live date to actual go-live date. TCS 34


NATFM,HYDERABAD 89

23 Delta-channel payment summary report generation SSA/TCS 35

24 Glcode-wise report generation from billing for the delta payments & arriving at Opening balance as in annexure-IV

TCS 36

25 Stage-1 reconciliation and furnishing signoff report in annexure-V & VI SSA 37

26 Sending journal feed from billing to accounting for opening balances TCS 38

27 Clearing „Claims recoverable from others-Delta Channel‟ debits by manual journal entry in accounting system

TCS/DC 39

28 Making journal entry in EFS for the commissions deducted from delta payments, if any.

SSA 39

29 Generation of Trial balance for the go-live month and previous month TCS 40

30 Making necessary journal entries in the EFS(external Financial System) for all the unbilled(debit/credit vouchers etc)/unaccounted transactions remained

in the source system prior to migration to CDR.

SSA 42

31 Closing of books opened for the month prior to Go-live month in CDR TCS 43

32 Stage-2 reconciliation between EFS Trial balance and CDR system balances SSA 44

20. Journal entries for migrated financial data .

On migration , TR related balances are moved to CDR system from the existing

source system(External Financial system). Non-CDR balances will continue in the

source system(EFS). Hence there is going to be two different Trial balances one

from CDR and the other from EFS. Both these trial balances will be merged to get a

consolidated Trial balance for the unit as a whole.

For moving the TR related balances from EFS to CDR we need to make two

sets of Journal entries- one for transferring the balances from EFS to CDR (on behalf

of EFS) and another for taking over the balances in CDR (on behalf of CDR system)

Following journal entries are required to be done ( on behalf of CDR system for

taking over the balances in CDR) after migration of financial data as per strategy :

(Similarly a reversal of following entries will happen for transfer from EFS to CDR

on behalf of EFS)

(i) Sundry Debtors: This includes surcharge (and WLL if migrated with landline)

Sundry Debtor account LL Dr XXX

To migration control account XXX


NATFM,HYDERABAD 90

Sundry Debtor account BB Dr XXX


(ii) Service Tax Recoverable:

Service tax recoverable Dr XXX


Migration control account Dr XXX

To Service tax payable XXX

Note: Service tax payable and recoverable are taken at equal figures since it is assumed

that both will be equal in the normal circumstances. Difference if any may have to be dealt

with in the EFS.

(iii) CDR based Credit Memo Invoicing account:

All credit vouchers pending relating to revenue items are to be migrated through this

head. But it has to be borne in mind that these credit vouchers are lying unaccounted in

the source till such time they are billed. Hence we need to account these in source first

and then we have to move the balance sheet item to CDR system.

For example if there is a credit voucher for rental rebate granted for fault period, following JS

needs to be made in source system first:

Fixed charges-Telephones Dr XXX

To Credit memo invoicing account XXX

The above debit in income head will be accounted for in the source, and the credit entry

will be migrated to CDR for subsequent adjustment through future bills, as follow:


To Credit memo invoicing account Cr XXX

If it is an ECS discount credit voucher, for example, then the following entry will be made in

source system:

ECS Discount account Dr XXX

To Credit memo invoicing account XXX

The above debit head will be accounted for in the source , and the credit entry will be

migrated to CDR for subsequent adjustment through future bills , as follow:


To Credit memo invoicing account Cr XXX

Similarly all the credit vouchers pending in source needs to be accounted for in source

before migration.


NATFM,HYDERABAD 91

CDR based Debit Memo Invoicing account: Similar to Credit vouchers, the debit

vouchers(except deposits) also need to be accounted for in the source first and then

moved to CDR system.

For example if there is a debit voucher for short billing of local call charges, following will be

the journal entry in source system:

Debit memo invoicing account Dr XXX

To Local call charges XXX

The credit entry will be accounted for in source and the debit entry will be moved to

CDR for subsequent adjustment through future bills, as follow:


To Migration control account XXX

Refund due on double or excess payment:


To Refund due on double or excess payment XXX

Refund due on working connections:


To Refund due on working connections XXX

Refund due on closed connections:


To Refund due on closed connections XXX

Advance payment received from customer:

Voluntary deposits, pre-connection deposits etc are considered advance payments in CDR.


To advance from customers XXX

Accrued Interest for application deposit:

Accrued interest on application deposits etc. need to be calculated upto 31st March of the

year prior to migration date and interest accounted for in the source system. The accrued

interest will be moved to CDR.

Interest on pre-connection deposits etc Dr XXX

To accrued interest on pre-connection deposits XXX


To accrued interest on deposits XXX

OYT Deposits: Upto date adjustment for rebate etc. needs to be accounted for in the source

first and only the net balance eligible for refund as on migration date will be transferred to

CDR system.


NATFM,HYDERABAD 92

If any adjustment is required in source, then following JS is required.

OYT deposits Dr XXX

To fixed charges XXX

For the balance OYT deposit, following will be the entry:


To OYT Deposit account XXX

Security Deposits:

Migration Control account Dr XXX

To Security Deposit account XXX

Security Deposit raised as debit voucher but not billed:

This has to be first brought into the source book as follow:


To Security deposit under recovery XXX

Then it has to be moved as follow:


To Security Deposit under recovery XXX


To Migration Control account XXX

When subsequently billed in target CDR:

Security deposit recoverable Dr XXX

To debit memo invoicing account XXX

Security Deposit billed but not realised:

This has to be first brought into the source book as follow:


To Security deposit under recovery XXX

Then it has to be moved as follow:


To Security Deposit under recovery XXX


To Migration Control account XXX


NATFM,HYDERABAD 93

Account Codes (GL codes) normally involved in the data migration:

Sl.No.

GL Code

Description Amount

(Dr) Amount(Cr)

1 1110101

Sundry Debtors LL XX

2 111050

9 Sundry Debtors BB XX

3 1110901

Service Tax Recoverable XX

4 1192301

Service Tax Payable XX

5 119450

4 CDR based Credit Memo Invoicing account XX

6 1131025

CDR based Debit Memo Invoicing account XX

7 1193001

Refund due on double or excess payment XX

8 1193003

Refund due on working connections XX

9 119300

2

Refund due on Closed/Surrendered

connections XX

10 1191100

Advance payment received from customer XX

11 1191399

Accrued Interest for application deposit XX

12 119270

1 OYT Deposits XX

13 1192714

Security Deposits XX

14 1194701

Security Deposit under recovery (Billed) XX

15 1132501

Security Deposit recoverable (Billed) XX

16 119470

1 Security Deposit under recovery (Un-Billed) XX

17 0099999

Migration control account

XX (Cr/Dr) There will be difference between the debits and credits and this is due to the fact that we

are migrating only the balance sheet items related to TR and not the P & L account items &

other balances. The revenue booked in the source are left there only and needs to be dealt

with in the EFS. The difference between the total of debits and credits is shown against

„0099999 Migration control account to make it balance. This will be a constant figure which

will be frozen after OB is reconciled .


NATFM,HYDERABAD 94

Sample JS For Transfer to CDR (on behalf of EFS)

Dr Cr

0099999 Migration Control account 62668969.50

1110101 Sundry Debtor account LL 62668969.50


1110509 Sundry Debtor account BB 7265563.27


1110901 Service Tax Recoverable 7068447.09

1192301 Service Tax Payable 7068447.00


1194504 CDR based Credit Memo Invoicing account 1980129.80



1131025 CDR based Debit Memo Invoicing account 240841.60


1131025 CDR based Debit Memo Invoicing account -Unbilled SD 67500.00

1193001 Refund due on double or excess payment

0099999 Migration Control account

1193003 Refund due on working connections


1193002 Refund due on Closed/Surrendered connections


1191100 Advance payment received from customer 321347.00


1191399 Accrued Interest for application deposit


1192701 OYT Deposits 9413489.00


1192714 Security Deposits 117243711.45


1194701 Security Deposit under recovery (Billed) 189208.99


1194701 Security Deposit under recovery (Un-Billed) 67500.00



1132501 Security Deposit recoverable (Billed) 189208.99

Total for migration control account 77500530.45 136283833.24


NATFM,HYDERABAD 95

Net of migration control a/c 58783302.79 CR

Sample JS For Taking over in CDR(On behalf of CDR)

Dr Cr

1110101 Sundry Debtor account LL 62668969.50


1110509 Sundry Debtor account BB 7265563.27


1110901 Service Tax Recoverable 7068447.09



1192301 Service Tax Payable 7068447.00


1194504 CDR based Credit Memo Invoicing account 1980129.80

1131025 CDR based Debit Memo Invoicing

account 240841.60


1131025 CDR based Debit Memo Invoicing account-Unbilled SD 67500.00



1193001 Refund due on double or excess payment


1193003 Refund due on working connections


1193002 Refund due on Closed/Surrendered

connections


1191100 Advance payment received from customer 321347.00


1191399 Accrued Interest for application deposit


1192701 OYT Deposits 9413489.00


1192714 Security Deposits 117243711.45


1194701 Security Deposit under recovery (Billed) 189208.99


1194701 Security Deposit under recovery (Un-

Billed) 67500.00

1132501 Security Deposit recoverable (Billed) 189208.99


Migration control a/c total 136283833.24 77500530.45

Net of migration control a/c 58783302.79 DR


NATFM,HYDERABAD 96

It may be seen from the above two sample JS, there is a credit under migration control account in EFS and a corresponding Debit in CDR. When both are merged ,this gets nullified.

21. Handling third party vendor payments collected through CDR

invoices

Right now there is a provision for entering the details of refund cheques issued to

subscribers in the CRM module. As per the approach document shared with TCS on

'Implementing Bundled PC EMI solution in the CDR system' there has to be a similar

provision in CDR system to enter the details of cheque payment made to the PC vendor.

When the EMI amount is transferred to the hardware supplier, a cheque is issued by

the AO (Cash). As a rule, the AO cash will operate only one GL code for all TR related

payments and receipts. So cheque issuance will be captured in the EFS (Cash/Bank book)

as

1194501 TRC Settlement Account Dr XXX

To Bank Cr XXX

The information on cheque issued will be input in to the CDR system. The result would be as

follows.

1193401 – „Payable to PC/Laptop Mfg. for EMI of PC under bundled scheme‟ Dr XXX

To 1194501 TRC Settlement Account Cr XXX

Similarly provision is expected for all the third party vendor payments collected through

CDR invoices. However this feature is not available in CDR at present.

At present the following type of payments are there which are raised and collected

through CDR invoices and paid to vendors from EFS(External Financial System):

1. EMI collected from rural subscribers on Bundled PC offers from HCL/NOVA etc.

2. Service tax collected and payable to excise authorities.

Following constraints were expressed in providing the above feature:

a) It could not provided in accounting directly:

Currently manual entries passed by the user are only for rectification and adjustment.

Any other entries in accounting has to come from Billing/PMS.

b) It could not be provided from billing: The cheque payment to customer is for

an account which is in CDR and there is a related transaction. Hence the

transactions relating to third party vendor who does not hold any account in CDR

billing system cannot be captured through billing system. It can be a direct

transaction from PMS to Accounting.


NATFM,HYDERABAD 97

c) It could not be provided from PMS: We cannot have payment disbursements

getting in to the PMS. All receipts will come through PMS and disbursements will

be dealt with through CRM/Billing. This is the fundamental rule that we have tried

to implement in the CDR system.

A proposal to have some dummy account created and deal this through billing

was put forth and again having the dummy account created at SSA level for all

such transactions was felt another practical constraint.

Strategy decided:

In view of the above constraints, it has been decided to have these transactions

entered as a Journal Slip in the accounting system on monthly basis. The SSAs

already provided with user id and password will make the Journal entry on

monthly basis before generation of SLR reports and Trial balance. Other SSAs,

till such time user id/password is provided, will pass on the Journal entry details

in the prescribed template to the respective ITPC-DC and the Journal entries

will be made by DC.

AO(cash) of the respective SSAs dealing with this payment will prepare the

Journal Slip in the prescribed format on monthly basis and handover the same to

the Accounting section in the SSA which is empowered to access the CDR

accounting system and pass Journal entries. Along with the Journal slip, the

details of cheque payments also need to be enclosed. These payments are to

be classified under „1194501 TR settlement account‟ in the EFS(External

Financial system) bank book.

The Accounting section will keep a complete record of these Journal Slips

serially numbered. They need to note the system generated sequence number

also on the Journal slip. They have to take care that there is no duplication in

entering these Journals. The SSAs have to review these balances from the Trial

balance and reconcile periodically.


NATFM,HYDERABAD 98

Template of Journal slip to be prepared :

Journal Slip No: CDR System Journal Seq.No:

Journal Entries for the payments made to third party vendors

Description

Entries for the payments made to third party vendors for amount collected through CDR invoices.

Ledger BSNS (Replace S with N,W,E etc for the respective Zones)

Category MA MA means manual entry.

Period Jul-10 If it is for July-10

Effective Date 31-Jul-10 If it is for July-10

Lines

Line Account * Debit(INR) Credit(INR) Description

1 S.AP.HYD.1192301 XX Service tax payment to excise authorities

2 S.AP.HYD.1192306 XX ST CESS payment to excise authorities

3 S.AP.HYD.1192309 XX ST HEC payment to excise authorities

4 S.AP.HYD.1194501 XX Service tax payment to excise authorities

5 S.AP.HYD.1193401 XXX EMI payment on PC bundling scheme

6 S.AP.HYD.1194501 XXX EMI payment on PC bundling scheme

7

Total XXX XXX

* Replace S.AP.HYD with zone,Circle,SSA code. Here it is for Hyderabad in AP Circle in South Zone.

Description of GL codes used above:

1192301 Ser Tax Payable 1192306 Ser Tax Payable-Education Cess 1192309 Ser Tax Payable –Hiher Education Cess

1194501 CDR TRC Settlement account 1193401 Payable to PC/Laptop Mfg. for EMI of PC under bundled scheme

22. Accounting for Zonal Electronic Stapling

Electronic Stapling(ES) is used to combine various bills (if required, from different billing

systems also) of the same customer and then provide the information to PMS for collection.

In Zonal ES System, access remains in one particular zone (SSA of the Data Center). Zonal Bill is

generated in one zone only, the home zone of the customer. It is not replicated across various zonal

PMS Systems.

An account for excess payments will be maintained in the CDR billing system for every ES account. Any excess payment, made against the ES invoice, will be posted in this account. This will be a master account in DC SSA.

Under the Zonal ES system, there will be various scenarios for which respective accounting treatments is captured below.


NATFM,HYDERABAD 99

Scenario 1: No Excess Payment

Consider a scenario, where a customer is having four connections from BSNL 1 landline, 1

Broadband and 2 GSM connections at different SSA‟s mentioned below. Now the monthly bill is

raised as follows;

LL1 BB1 GSM1 GSM2 Total

Owning SSA/Circle Bhopal Pune MH MP

June Bill Due 553 663 1103 2206 4525

*- Master Account is at DC (i.e. Pune)

In step 1, the Billing System will give feed to the Accounting System for posting the entry related to

the invoice generation belonging to the landline of the customer in Bhopal & Pune SSA.

There will not be any Global System for Mobile Communication (GSM) related invoice feeds from the

external invoicing systems. Hence, no Accounting related to them is carried out here.

So the following two entries are made at the time of invoice raised by the home billing system for

different SSA‟s of Bhopal & Pune respectively. Entries for invoice raised in Bhopal & Pune are as

under;

Invoice generation feed from Billing system for LL1 at Bhopal SSA 1110101 Sundry Debtors Landline Dr. 500 BPL

1110901 Service tax recoverable Dr. 50 BPL

1110906 Education cess recoverable Dr. 2 BPL

1110909 HEC Recoverable Dr. 1 BPL

To 1310101 Fixed charges 150 BPL

To 1310201 Local Calls 350 BPL

To 1192301 Service tax Payable 50 BPL

To 1192306 Education cess Payable 2 BPL

To 1192309 HEC Payable 1 BPL

Invoice generation feed from Billing system for BB1 at Pune SSA 1110509 Sundry Debtors Broadband Dr. 600 PUN

1110901 Service tax recoverable Dr. 60 PUN

1110906 Education cess recoverable Dr. 2 PUN

1110909 HEC Recoverable Dr. 1 PUN

To 1310101 Fixed charges 250 PUN

To 1310201 Local Calls 350 PUN

To 1192301 Service tax Payable 60 PUN

To 1192306 Education cess Payable 2 PUN

To 1192309 HEC Payable 1 PUN

In step 2, ES will club all the invoices of the same customer, where the accounting is not impacted

and send a single bill to the customer.

No accounting entries at this point of time

In step 3, PMS collects the consolidated payments and provides the same information to the

Accounting System based on which the Claims Recoverable and CDR based TR Collection Accounts

will be updated at the receiving SSA only. Let‟s say the customer pays the full bill of Rs. 4525 at Bank


NATFM,HYDERABAD 100

and payment is made at Pune SSA. The respective entries from PMS to accounting will be as

under:

Daily list (PMS feed):

1132303 CDR based TRC Claims from Bank Dr. 4525 PUN

To 1194502 CDR based TR Collection 4525 PUN

Schedule (PMS feed):

1194501 CDR based TRC Settlement A/c Dr. 4525 PUN

To 1132303 CDR based TRC Claims from Bank 4525 PUN

In Step 3, ES will distribute the consolidated amount to various invoices of the same customer; it will

provide a feed to the Accounting System for all the invoices so that Accounting can pass the

Remittance appropriately to Revenue Owning SSA and other Invoicing Systems. So here only the

payments related to GSM would be closed. The ES will send the owning and receiving SSA

information in the feed.

On ES Feed

For GSM 1, the owning circle is MH and payment is received in Pune which is in MH circle. So there

is no remittance involved. The following entries would be passed

1194502 CDR based TR Collection Dr. 1103 PUN

To 1194601 CDR claims payable to CMTS 1103 PUN

For GSM 2, the owning circle is MP and payment is received in Pune which is in MH circle. So the

remittance entries would be as follows from the ES feed;


To 1990915 CDR bsd TR Remittance btwn circles Madhya Pradesh (O) 2206 PUN

1991016 CDR bsd TR Remittance btwn circles Maharashtra (R) Dr. 2206 MP

To 1194601 CDR claims payable to CMTS 2206 MP

Billing Feed at the time of settlement of invoice

When the CDR billing gives the feed to the Accounting System, that is when outstanding from a

customer is cleared, the Accounting System will book the entry accordingly by crediting the Sundry

Debtors.

For LL1



1991016 CDR bsd TR Remittance btwn circles Maharashtra(R) Dr. 553 BPL

To 1110101 Sundry Debtors Landline 500 BPL

To 1110901 Service tax recoverable 50 BPL

To 1110906 Education cess recoverable 2 BPL

To 1110909 HEC Recoverable 1 BPL

For BB1 1194502 CDR based TR Collection Dr. 653 PUN

To 1110509 Sundry Debtors Broadband 600 PUN

To 1110901 Service tax recoverable 50 PUN


NATFM,HYDERABAD 101

To 1110906 Education cess recoverable 2 PUN

To 1110909 HEC Recoverable 1 PUN

Scenario 2: Excess Payment

Considering the above scenario, let‟s say customer makes the excess payment of Rs.975 by paying

the total amount of Rs.5500. In this scenario the ES will park the excess amount to the CDR master

account created to park the excess payment. This payment will always be parked at the DC SSA,

here it is Pune SSA.

LL1 BB1 GSM1 GSM2 Total Payment Excess

Owning SSA/Circle Bhopal Pune MH MP Pune

June Bill Due 553 663 1103 2206 4525 5500 -975


In step 1, the Billing System will give feed to the Accounting System for posting the entry related to

the invoice generation belonging to the landline of the customer in Bhopal & Pune SSA.

There will not be any Global System for Mobile Communication (GSM) related invoice feeds from the

external invoicing systems. Hence, no Accounting related to them is carried out here.

Invoice generation feed from Billing system for LL1 at Bhopal SSA

1110101 Sundry Debtors Landline Dr. 500 BPL











1110906 Education cess recoverable Dr. 2 PUN

1110909 HEC Recoverable Dr. 1 PUN




To 1192306 Education cess Payable 2 PUN

To 1192309 HEC Payable 1 PUN

In step 2, ES will club all the invoices of the same customer, where the accounting is not impacted

and send a single bill to the customer.

No accounting entries at this point of time

In step 3, PMS will collect the consolidated payments. Let‟s say the customer pays the Rs.5000 at post office and payment is made at Pune SSA. Daily list (PMS feed):

1132303CDR based TRC Claims from Bank Dr. 5500 PUN


NATFM,HYDERABAD 102




To 1132303CDR based TRC Claims from bank 5500 PUN

In Step 3, ES will distribute the consolidated amount to various invoices of the same customer; it will

provide a feed to the Accounting System for all the invoices so that Accounting can pass the

Remittance appropriately to Revenue Owning SSA and other Invoicing Systems. So here only the

payments related to GSM would be closed.

On ES Feed For GSM 1, the following entries would be passed based on the ES feed; 1194502 CDR based TR Collection Dr. 1103 PUN


For GSM 2, the following entries would be passed based on the ES feed;





For Excess Payment, the following entries would be parked based on the ES feed at the Pune SSA,

as the master account is at Pune SSA. Here the payment is received at Pune so no remittance entries

would be involved.


To 1193001 Refund due on Double/Excess Payment of bills 975 PUN

On Billing Feed; the entries at the time of the settlement of the invoice

When the CDR billing gives the feed to the Accounting System, that is when outstanding from a

customer is cleared, the Accounting System will book the entry accordingly by crediting the Sundry

Debtors.

For LL1 1194502 CDR based TR Collection Dr. 553 PUN







For BB1 1194502 CDR based TR Collection Dr. 653 PUN



To 1110906 Education cess recoverable 2 PUN


NATFM,HYDERABAD 103

To 1110909 HEC Recoverable 1 PUN

On next invoice generation LL1 BB1 GSM1 GSM2 Total Excess Due

Owning SSA/Circle Bhopal Pune MH MP Pune

July Bill Due 333 221 883 1655 3092 -975 2117


Invoice generation feed from Billing system for LL1 at Bhopal SSA 1110101 Sundry Debtors Landline Dr. 300 BPL











1110906 Education cess recoverable Dr. 0.80 PUN

1110909 HEC Recoverable Dr. 0.20 PUN




To 1192306 Education cess Payable 0.80 PUN

To 1192309 HEC Payable 0.20 PUN

Now, the customer pays the net outstanding of Rs. 2117 after settling his excess payment of Rs.975. LL1 BB1 GSM1 GSM2 Total Excess Payment Due

Owning SSA/Circle Bhopal Pune MH MP Total Pune

July Bill Due 333 221 883 1655 3092 -975 2117

Settlement from

Excess -333 -221 -421 0 -975 +975

Settlement from

Payment 0 0 -462 -1655 -2117 0 -2117

Balance 0 0 0 0 0 0 0

The entries from PMS would be as follows;

Daily list (PMS feed):

1132303 CDR based TRC Claims from bank Dr. 2117 PUN




To 1132303CDR based TRC Claims from Bank 2117 PUN

On ES Feed; The entries based on the ES feed would be as follows;


NATFM,HYDERABAD 104


Excess payment settlement of Rs.421 1193001 Refund due on Double/Excess Payment of bills Dr. 421 PUN









On Billing feed at the time of invoice settlement, the following entries would be made;

For LL1

1193001 Refund due on Double/Excess Payment of bills Dr. 333 PUN







For BB1

1193001 Refund due on Double/Excess Payment of bills Dr. 221 PUN



To 1110906 Education cess recoverable 0.80 PUN

To 1110909 HEC Recoverable 0.20 PUN

23. Handling of ES discount in CDR Accounting

As per clarification from Corporate office vide letter No.2-22/2007-BSNL/TR dated 13/05/2010 , the

group discount needs to be treated „trade discount‟ (reducing the income(usage)). Also as per existing

orders on this, the discount needs to be allowed in the same bill . If the bill amount is not paid within the

specified period, the discount allowed has to be raised as a debit and income recognized in the next bill.

In view of the integrated accounting in CDR, there are practical difficulties in allowing the discount in the

same bill. Since discount is based on total volume of all child accounts, to arrive at the discount, the

invoices of all child accounts need to be generated first. Once discount is arrived at, all the child accounts

have to be regenerated considering this as usage discount. Subsequently, if payment is not taking place

within specified time, the discount allowed needs to be raised as debit in the next bill and income

recognized. All these activities involve in processing delay and further manual monitoring. Hence the


NATFM,HYDERABAD 105

practice of allowing discount based on actual eligibility in the next bill run seems to be the better alternative

and the same has been proposed to be continued.. Corporate Office order No.11-2/2009-CDR/IT/Vol-IV

dated 27th Apr-2010 also permits allowing of discount in the next bill as adjustment.

Moreover, if discount is straight away debited to the income head as „Trade discount‟ we may not be in

a position to tell the Group bill discount amount, if required for some policy decision , at a later date.

Hence we have proposed to continue the following procedure to achieve the desired result:

At the time of allowing discount:

1310201 Local Calls Dr

To 1742601 Discount on ES Billing Cr

(We have to debit a standard head like „Local calls „ , since identifying each revenue head and

passing debit to the extent of discount allowed will be a cumbersome process).

At the time of billing:

1742601 Discount on ES Billing Dr

To 1110101 Sundry debtors etc Cr

This way , we will be treating the discount as „trade discount‟ and we can know the amount of

discount allowed based on „period credit‟ in Trial balance from the GL code „ 1742601

Discount on ES Billing „ even though the net figure under this head will be „0‟.

24. Account Settlement Procedure Initiated either in case of Disconnection due to Non Payment or due to Voluntary

Closure.

Initiated from CRM through a batch process after ensuring that

(a) all the services attached to the account are disconnected and

(b) there are no open order or waitlist order for the account.

The accounts are marked as „account settlement‟ status in CRM to avoid raising of

any modify order or ISR.

In case of Disconnection due to non payment, account settlement process will be

initiated immediately after the date of closure.

In case of Voluntary closure, it is proposed to be initiated 20 days after the

disconnection of the last service or 10th of the next month whichever is earlier.

Billing will receive the feed from CRM and run a script to process the accounts for

settlement.

Accounts with active services and CDR errors are excluded from this process.

The script ensures adjustment of all outstanding deposits and unbilled deposits as

follow:

1. Adjustments will be posted on all the invoices which have deposit

outstanding. The following entries will be sent to the accounting system in the

billing feed

Security Deposit under Recovery Dr To CDR based Credit Memo invoicing account


NATFM,HYDERABAD 106

The billed entries will be sent to the accounting system once these

adjustments are billed as part of the account settlement process

2. Any unbilled deposit charges if exist will be waived off. The following entries

would be sent to the accounting system

Security Deposit under Recovery Dr

To Debit Memo Pending for Invoice

3. The deposit amount available will be adjusted against the invoice outstanding

and if there are no open invoices, then the deposit amount will lie in excess.

The following entries would be sent to the accounting system

Security Deposit Dr

To Sundry Debtors

To Refund due on Closed Connections

The deposit amount will be posted as a payment.

4. For PCO deposit customers, the interest on LL Security Deposit will be

calculated. The interest will be calculated on the deposit amount from the

interest start date to till date.The following entries would be created in the

accounting system

When there is an outstanding

Interest on STD PCO Deposit Dr

To Sundry Debtors

When there is no outstanding

Interest on STD PCO Deposit Dr

To Interest accrued on STD/PT deposits

The process generates bills for all the pending bill cycles, if any.

It generates an interim bill upto the date of closure. It will bill all the adjustments

carried out.

All the invoices which were billed as a part of account settlement process are sent to

CRM and PMS system.

After generation of interim bill, a script will be run to generate the account settlement

response feed for the accounts where the interim bill is successful.

The account status in billing will be marked as „Disconnection request’.

Once the account settlement process is completed, a response feed would be sent to

CRM . If the outstanding amount is less than zero, a feed will go to CRM with the

refund flag and a refund request will be created in CRM and sent to AOTR for

approval.


NATFM,HYDERABAD 107

1. AOTR has an option of approving the complete amount or partial amount.

2. The AOTR is also given an option to enter the amount to be transferred to GSM

system and approve the refundable amount.

3. Once the AOTR approves the amount, an activity will be created for AO-

Cash.

4. The AO-Cash will input the approved amount, cheque number, bank name

and the comments. A confirmation of refund will get triggered to billing.

The cheque amount should not be in decimals. So if the refundable amount

is in decimals, the rounded off payment will be posted

The following entries would be created in the accounting system due

to the rounding off payment:

Gain or Loss on Rounding Dr

To Refund due on closed connections

Or

Refund due on closed connections Dr

To Gain or Loss on Rounding

5. The cheque details will be captured into the billing for the approved amount

and the remaining amount , if any, will be booked under „Other Receipts‟ in

accounting.

6. Separate refund transactions will be created for GSM and Customer refund.

7. Based on the success response from billing, the account will get inactivated in

CRM.

If the outstanding amount is greater than zero, then a feed would be sent to CRM

with the write-off flag. Write-off request will be created in the CRM and the request

will be sent to AO-Pursuit.

1. The outstanding amount needs to be pursued by following all the procedures

applicable for defaulters.

2. When the outstanding amount becomes irrecoverable and declared as a

„Bad Debt‟, AO Pursuit can enter the comments and write off the amount.

3. A confirmation of write-off will be triggered to billing and necessary journal will

flow to accounting debiting „bad debt‟/ „ST payable‟ and crediting „Sundry

Debtors‟/ „ST recoverable‟.

4. Based on success response from billing, the account will be made inactive in

CRM .


NATFM,HYDERABAD 108

5. Once the write-off payment is posted a feed will be sent to PMS system. PMS

will mark those accounts as „write-off „ accounts. Any subsequent recovery

from written-off amounts will not be posted to billing but will be sent direct to

accounting and will get classified as „other receipts‟.

If the outstanding amount is equal to zero, then a feed would be sent to CRM with the

„Closure‟ flag and the account would be made inactive in CRM.

In either of the cases either through refund or Write off payments, the outstanding against the

account is made Rs.0. The immediate bill that is generated after the balance is made Rs.0 will

move the account status from “Disconnection request” to “Disconnection done”.

When the account status in billing is changed to “Disconnection done” then the system will not

allow any transactions on the account.

CRM system will allow to raise adjustments on the account with status as “Account

Settlement”. When any such transaction is made the status of the account in CRM will

become “Active”.

The account settlement refund/write off requests existing against the account will be

cancelled automatically by the system and the status will be modifed to “Cancelled”

The account will be picked when the account settlement list is generated next time and sent

to billing.

Accounting Module (Oracle Applications)-User Manual

Introduction Accounting module is dependent on other source systems for data.

The source systems are Billing, PMS and ES.

The Accounting system keeps the monetary records of the CDR system.

Journals -These are entries made in the form of Debit and Credit for monetary transactions

In CDR system, the journals are entered either manually or through source systems (Billing,

PMS, E-Stapling Systems) automatically

Account Analysis Report – This report provides information regarding a particular GL code or

range of GL codes for a particular period

Trial Balance Report – This report provides the detailed information about all the GL codes for

a particular period

Features in Accounting Module Creating or Reversing the Manual Journals Entries

Posting the Manual Journals Entries

Viewing the existing Journal Entries

Submitting and Viewing the Account Analysis Report

Submitting and Viewing the Trial Balance Report


NATFM,HYDERABAD 109

Authorizations at SSA level

Depending on the authorization, the following tasks can be performed by the users at SSA

level:

Access to the Responsibility screen

Create or Reverse Manual Journal Entries

Post Manual Journal Entries

View Journal Entries

Submit and View the Account Analysis Report

Submit and View the Trial Balance Report

There are two levels of SSA user:

CHN GL (Does not have access to Post the journals)

CHN GL Post (Does have access to Post the journals)

Viewing Journals

On the basis of the following fields, the Journals can be viewed or searched at SSA level :

o Posting Status : Posted or Unposted

o Source : Billing, PMS, ES, or Manual

o Category : Different feeds for different sources

o Period : Month and year in which the journals are created

Login to Accounting Module of Oracle Applications

To login to the Oracle Applications:

Step 1: Enter the User Name and Password.

Step 2: Click Login. A screen appears with the user responsibilities.

After successful login, the Responsibility screen appears.

Access the responsibility

To access the responsibility:

Step 1: Click CHN GL or CHN GL Post. A menu appears on the right side of the screen.

Step 2: Click the menu for executing the task. An Applet form appears.

Note: Depending on the user privileges the menu is displayed.

• Journals > Enter : Park or Reverse manual journals

• Journals > Enter (CHN GL Post only) : Post manual/reversal journals

Or

Journals > Post (CHN GL Post only): For mass posting

• Reports > Request : Account Analysis and Trial Balance reports can be executed

• Reports : Inquiry > Journal : The journals related to a particular SSA can be viewed

Step 3: Click on the task which has to be executed as per the requirement. An applet appears.

For example, Click Journals > Enter.

Along with the applet, the form of task appears.


NATFM,HYDERABAD 110

Park or Reverse Manual Journals

To park manual journals:

Step 1: Click Journals > Enter in CHN GL screen. The Find Journals window appears.

Step 2: Click on New Journal on Find Journals window.

Step 3: Enter the following field:

i) Journal: Name of the journal entry. It is free text.

ii) Ledger: BSNS

iii) Category: Select from List of values like MA,AI or AD.

iv) Period: Name of the period

v) Effective Date: Date of the journal

Lines

i) Line: Enter 1. Hence after, system will take Line automatically

ii) Account: Select Zone. Circle. SSA. GL code from the List of values.

iii) Debit (INR): Debit Amount for the corresponding Account described

iv) Credit (INR): Credit Amount for the corresponding Account described

Step 4: Save the journal

Reverse Manual Journals

To reverse manual journals:

Step 1: Click Journals > Enter. The Find Journal window appears.

Step 2: Inquire the journal (which needs to be reversed i.e. MA,AD or AI) on Find Journals window.

Step 3: Click on Review Journal tab.

Step 4: Enter the following details on the right hand side corner of Journals window:

i) Period: The period in which the journal has to be reversed.

ii) Method: Switch Dr/Cr

iii) Status : Not Reversed

Step 5: Click on Reverse button.

Note: Only posted manual journals can be reversed.

Post Manual/ Reversal Journals – CHN GL Post

To post manual/reversal journals from CHN GL Post responsibility:

Step 1: Go to CHN GL Post responsibility.

Step 2: Click Journals > Enter. The Find Journals window appears.

Or

Click Journals > Post for mass posting. The Find Journal Batches window appears.

Step 3: Find the journal to post from Find Journals window.

Or

Select the journals to post (for mass posting) from Post Journals window.

Step 4: Click on Post

Note: The period should be open for posting journals.


NATFM,HYDERABAD 111

Find and View the Journals

To find and view the journals:

Step 1: Click Reports: Inquiry > Journal. The Find Journals form appears.

Step 2: Enter the details. Click Find. The journals appear on the Journal Entry Inquiry form.

Step 3: Select a journal. Click Review Journal. The Journals form appears.

Step 4: Click T Accounts… to view the Journal in T-format.

Step 5: Close the Journals form. The Navigator-CHN GL screen appears.

Submit the Account Analysis Report

To submit the Account Analysis Report:

Step 1: Click Reports > Request in the Navigator-CHN GL screen. The Submit a New Request

screen appears.

Step 2: Select Single Request and click OK. The Submit Request form appears as shown in next

slide.

Step 3: Enter the Name as Account Analysis – (180 Char). Press Enter. The Parameters form

appears.

Step 4: Enter the Parameters as per the requirement.

Ledger/Ledger Set: By default, it is BSNS.

Ledger Currency: By default, it is INR.

Currency Type: Select Entered or Total from the list of values.

Entered Currency: By default, it is N/A.

Type: Select Entry Item, Line Item or Source Item from the list of values.

Balance Type: Select A, that is, Actual from the list of values.

Budget or Encumbrance Name: By default, it is N/A.

Starting Period & Ending Period: Select the Starting and Ending period from the list of

values for which the report has to be generated.

Flexfield From & Flexfield To: Select the From and To Flexfield for which report has to be

generated. The Flexfield will be in Zone. Circle. SSA. GL code format.

Order By: Select Account Segment, Balancing Segment or Source from the list of values.

Step 5: Click OK. The Parameters form closes.

Step 6: Click Submit. The Submit Request form closes.

Note: The status of the report generated can be viewed as shown in the next slide.

Note: The Copy…button on the Submit Request form helps to copy the request that has been

executed with the same parameters to run the process.

View the Account Analysis Report

To view the Account Analysis Report:

Step 1: Click View > Requests. The Find Requests form appears.

Step 2: Click Find. The Find Requests form appears.

Step 3: Click Name. The reports that have been generated previously appears.


NATFM,HYDERABAD 112

Step 4: Select the report. Click View Output to view the report.

Note: The output can be saved as a text file.

Submit the Trial Balance Report

To submit the Trial Balance Report:

Step 1: Click Reports > Request in the Navigator-CHN GL screen. The Submit a New Request form

appears.

Step 2: Select Single Request and click OK. The Submit Request form appears as shown in next

slide.

Step 3: Enter the Name as Trial Balance.

Step 4: Enter the Parameters as per the requirement.

Ledger/Ledger Set: By default, it is BSNS.

Ledger Currency: By default, it is INR.

Currency Type: Select Entered or Total from the list of values.

Entered Currency: By default, it is N/A.

Pagebreak Segment: Select SSA from the list of values.

Pagebreak Segment Low & High: Select CHN from the list of values.

Period: Select the period from the list of values for which report has to be generated.

Amount Type: Select YTD or PTD from the list of values.

Step 5: Click OK. The Parameters form closes.

Step 6: Click Submit. The Submit Request form closes.

Note: The status of the report generated can be viewed as shown in the next slide.

Note: The Copy…button on the Submit Request form helps to copy the request that has been

executed with the same parameters to run the process.

View the Trial Balance Report

To view the Trial Balance Report:

Step 1: Click View > Requests. The Find Requests form appears.

Step 2: Click Find. The Find Requests form appears.

Step 3: Click Name. The reports that have been generated previously appears.

Step 4: Select the report. Click View Output to view the report.

Note: The output can be saved as a text file.

Log out from Oracle Applications

To log out from Oracle Applications:

Step 1: Click X, as circled above.

Or, From the menu bar, click File > Exit Oracle Applications.

Step 2: A dialog box appears, Exit Oracle Applications?. Click OK. The Oracle Applications window

closes.


NATFM,HYDERABAD 113

Implementation of amended Service Tax Rules in CDR System as per Corporate office Circular CA-264 dated 1st July-2011.

With reference to certain amendments made in Service tax rules through Finance Bill 2011

and subsequent clarifications given by BSNL Corporate office, some changes in CDR system

are made to comply with the following:

Service tax payment based on invoices raised irrespective of its realization

(against the existing procedure of payment on realization of tax).

Payment of Service tax on advance payments.

Payment of service tax on excess payments.

Payment of service tax on voluntary deposits.

For implementation of the above amendment, Corporate office have allotted some new account

codes vide Circular CA-264 & CA-264-A.

The overall accounting flow in respect of post paid basic service given in the circular is as

summarized below:

Accounting Entries-Basic services-Post Paid [ C.O. circular CA-264 ]

GLcode Description Dr/Cr

On billing:

1114401 Service Tax Recoverable on post paid service as per POT rule Dr

1114402 Education cess recoverable as per POT Dr

1114403 Higher Education cess recoverable as per POT Dr

1196001 Service Tax Payable on post paid service as per POT rule Cr

1196002 Education cess payable as per POT Cr

1196003 Higher Education cess payable as per POT Cr

1133101 Service Tax paid to Service Tax Authority on post paid Basic service as per POT rule Dr

1133102 Education cess paid as per POT Dr

1133103 Higher Education cess paid as per POT Dr

1196201 Service tax Payable to Service Tax Authority on post paid basic service as per POT rule Cr

1196202 ED cess on ST Payable to Service Tax Authority on post paid basic service as per POT rule Cr

1196203 SHE cess on ST Payable to Service Tax Authority on post paid basic service as per POT rule Cr

On realisation of invoice amount/excess amount:

Bank/Cash Dr

Sundry Debtor Cr

1114401 Service Tax Recoverable for post paid service as per POT Cr

1114402 Education cess recoverable as per POT Cr

1114403 Higher Education cess recoverable as per POT Cr

1196301 Amount paid in excess by subscriber (in case of excess payment) Cr


NATFM,HYDERABAD 114



Apportionment of excess payment

1196301 Amount paid in excess by subscriber Dr

1196302 Amount of revenue out of excess payment Cr

1196303 ST payable on the amount excess paid Cr

1196304 ED cess on ST payable on the amount excess paid Cr

1196305 SHE cess on ST payable on the amount excess paid Cr

1196001 Service Tax Payable for post paid service as per POT Dr

1196002 Education cess payable as per POT Dr

1196003 Higher Education cess payable as per POT Dr

1133101 Service Tax paid to Service Tax Authority for post paid service Cr

1133102 Education cess paid as per POT Cr

1133103 Higher Education cess paid as per POT Cr

On receipt of advance payment:

Bank account Dr

Advance from customers Cr

1196401 ST payable on advance amount Cr

1196402 ED cess on ST payable on advance amount Cr

1196403 SHE cess on ST payable on advance amount Cr

On refund of advance due to non-provision:

Advance from customers Dr

1133401 ST recoverable on advance refunded Dr

1133402 ED cess on ST recoverable on advance refunded Dr

1133403 SHE cess on ST recoverable on advance refunded Dr

1193005 Refund of advance taken (including ST) Cr

1193005 Refund of advance taken (including ST) Dr

Bank account Cr

On cancellation (adjustment):







1133301 Amount of service tax pertaining to post paid bills cancelled Dr


NATFM,HYDERABAD 115



1133302 Education cess cancelled as per POT Dr

1133303 Higher Education cess cancelled as per POT Dr


1133102 Education cess paid to ST authority Cr

1133103 Higher Education cess paid to ST authority Cr

On write off proposal:

1133201 Amount of service tax paid in respect of post paid bills which could not be collected Dr

1133202 Education cess could not be collected Dr

1133203 Higher Education cess could not be collected Dr


1133102 Education cess paid as per POT Cr

1133103 Higher Education cess paid as per POT Cr







On realisation after write-off proposal:

Bank/Cash Dr

Sundry Debtor Cr

1133201 Amount of service tax paid in respect of post paid bills which could not be collected Cr

1133202 Education cess could not be collected Cr

1133203 Higher Education cess could not be collected Cr

On write off approval:

1742006 Bad debt for service provided written off Dr

1742007 Service Tax paid but not collected hence written off Dr

1133201 Amount of service tax paid in respect of post paid bills which could not be collected Cr

1133202 Education cess could not be collected Cr

1133203 Higher Education cess could not be collected Cr

Sundry Debtor Cr

On payment to ST Authority:

1196201 Service Tax Payable to Service Tax Authority for post paid service Dr

1196202 ED cess on ST Payable to Service Tax Authority on post paid basic service as per POT rule Dr

1196203 SHE cess on ST Payable to Service Tax Authority on post paid basic service as per POT rule Dr

1196303 ST payable on the amount excess paid Dr

1196304 ED cess on ST payable on the amount excess paid Dr


NATFM,HYDERABAD 116



1196305 SHE cess on ST payable on the amount excess paid Dr

1196401 ST payable on advance amount Dr

1196402 ED cess on ST payable on advance amount Dr

1196403 SHE cess on ST payable on advance amount Dr

1133301 Amount of service tax pertaining to post paid bills cancelled Cr

1133302 Education cess cancelled as per POT Cr

1133303 Higher Education cess cancelled as per POT Cr

1133401 ST recoverable on advance refunded Cr

1133402 ED cess on ST recoverable on advance refunded Cr

1133403 SHE cess on ST recoverable on advance refunded Cr

CENVAT credit Cr

Bank Cr

The new GL codes are to be operated for the service tax on all the invoices raised for services

rendered from 01.07.2011 onwards and advance/excess payments received from the effective date [

01.07.2011 ].

The module in CDR has been developed prior to issue of this circular with some limited account

codes after sharing the approach document with Corporate office. Hence the SI could not incorporate

the complete Account codes given in Circular CA-264 . As per endorsement given to ITPC in circular

CA-264, only the following account codes are considered for operation in CDR system:

1114401 ST/ED cess/SHE Cess Recoverable as per POT

1196001 Service Tax/Ed cess/SHE cess Payable as per POT rule 1196401 ST/Cess/SHE Cess payable on advance amount 1196302 Amount of revenue out of excess payment

1196303 ST/Cess/SHE Cess payable on excess payment 1742007 Service Tax paid but not collected hence written off [ Bad debt-Tax]

Billing procedure: At the time of billing, service tax amount received in advance & tax paid on

excess payment will be adjusted against tax due or any other due and invoice will be sent for the

balance amount.

Accounting treatment:

(a) Advance payment including deposit.

Let us assume a demand note payment of Rs 1000+10.03 % tax (on Rs 250) Rs 26 ie Rs 1026

which includes Rs 750 towards security deposit.

Billing will send the following invoice settlement ( IS) feed to accounting:

1194502 - TR Collection Account Dr 1026

To 1191100 Advance from customers Cr 1000

To 1196401 ST/Cess/SHE Cess payable on advance amount Cr 26

In case the demand note payment receiving SSA is not the owning SSA and the payment relates to

other SSAs/Circles, then the entire payment to be booked in remittance head and the booking in


NATFM,HYDERABAD 117

GLcode „1196401 ST/Cess/SHE Cess payable on advance amount „ will happen on behalf of the

owning SSA and the owning SSA has to settle the tax liability. The accounting feed in such cases will

be as follow:

(Payment receiving SSA)


To Remitance same/different Circle Cr 1026

(Payment owning SSA)

Remittance same/different Circle Dr 1026

To 1194502 TR collection account Cr 1026

1194502 -TR Collection Account Dr 1026

To 1191100-Advance from customers Cr 1000

To 1196401 ST/Cess/SHE Cess payable on advance amount Cr 26

(b) Excess payment

Let us assume a payment of Rs 1500 including an excess payment of Rs 500. Tax 10.03%

Billing will send the following invoice settlement ( IS) feed to accounting:


To Sundry debtors etc Cr 908

To 1114401 ST/ED cess/SHE Cess Recoverable as per POT Cr 92

To 1196302 Amount of revenue out of excess payment Cr 454

To 1196303 ST/Cess/SHE Cess payable on excess payment Cr 46

The revenue on excess payment will be calculated on pro-rata basis ie

“ (100 /110.03)* excess_amt “ and the balance will be the ST on excess payment.

In case the payment receiving SSA is not the owning SSA and the payment relates to other

SSAs/Circles, then the entire payment to be booked in remittance head and the booking in

GLcode „1196303 ST payable on excess payment „ will happen on behalf of the owning SSA

and the owning SSA has to settle the tax liability. The feed in such cases will be as follow:


To Remitance same/different Circle Cr 1500

(Payment owning SSA)

Remittance same/different Circle Dr 1500

To 1194502 TR collection account Cr 1500

1194502 -TR Collection Account Dr 1500

To Sundry debtors etc Cr 908

To 1114401 ST/ED cess/SHE Cess Recoverable as per PO Cr 92

To 1196302 Amount of revenue out of excess payment Cr 454

To 1196303 ST/Cess/SHE Cess payable on excess payment Cr 46


NATFM,HYDERABAD 118

Payment to service tax authorities will happen based on the total liability existing for the month

in following GLcodes:

1. 1196001-Service Tax/Ed cess/SHE cess Payable as per POT rule

2. 1196303 ST/Cess/SHE Cess payable on excess payment as per POT

3. 1196401 ST/Cess/SHE Cess payable on advance amount as per POT

However the total amount paid to ST authorities will be debited to „1196001-Service Tax/Ed

cess/SHE cess Payable as per POT rule‟. The debit balance , if any , appearing in the „1196001-

Service Tax/Ed cess/SHE cess Payable as per POT ‟ will get adjusted from subsequent normal

credits. A summary report along with annexure-I,II,III, IV,V & VI will be provided for this purpose.

The GL „1196001 –ST/Ed cess/SHE cess payable as per POT‟ may at times have a debit balance

and the corresponding credit will be available in GL „1196303 ST/Cess/SHE Cess payable on excess

payment as per POT‟ and „1196401- ST/Cess/SHE Cess payable on advance amount as per POT‟.

[ Actually AO cash will classify the payment to service tax authorities as „1194501-TR settlement

account‟ in bank book in EFS (external Financial system). A manual journal entry will be made in

CDR accounting system debiting „1196001-Service Tax/Ed cess/SHE cess Payable as per POT rule‟

and crediting „1194501-TR settlement account‟ by the SSAs or by DC if the details are furnished by

SSA to the Data centre.]

The account settlement process will transfer the balances , if any , under ‟ 1196302 Amount of

revenue out of excess payment „ and „1196303 ST/Cess/SHE Cess payable on excess payment as

per POT‟ to the credit of „1193002 Refund due on Closed connections‟.

1196302 Amount of revenue out of excess payment Dr 1196303 ST/Cess/SHE Cess payable on excess payment as per POT Dr

To 1193002 Refund due on Closed connections Cr

In respect of advance payments, when service is provided and invoice raised, following will be the

accounting feed (Assuming FC 750, usage Rs 1250, security deposit due Rs 750 and tax @10%):

1110101/1110509 Sundry Debtors LL/BB etc Dr 2000 1114401 ST/ED cess/SHE Cess Recoverable as per POT Dr 200 1132501-Security deposit Recoverable Dr 750

To various revenue heads (FC,Usage) Cr 2000 To 1196001-Service Tax/Ed cess/SHE cess Payable as per POT Cr 200 To 1194701-SD under recovery Cr 750

1191100 -Advance from Customers Dr 1000 1196401 ST/Cess/SHE Cess payable on advance amount Dr 26

To 1110101/1110509 Sundry Debtors LL/BB etc Cr 1000 To 1114401 ST/ED cess/SHE Cess Recoverable as per POT Cr 26

(credit will happen to the available open item and not necessarily to tax) Thus the net invoice to customer will be for the amount 2000+200+750-1000-26=1924 (Interest applicable, if any , on pre-connection deposits will be calculated on the net amount after tax

ie Rs 1000 and not on 1026 in this case).


NATFM,HYDERABAD 119

Let us assume the first invoice after provision of service is having FMC due of Rs 150 only (due to broken period) and usage of Rs 50. Then following are the accounting feeds expected:

1110101/1110509 Sundry Debtors LL/BB etc Dr 200 1114401 ST/ED cess/SHE Cess Recoverable as per POT Dr 20

1132501-Security deposit Recoverable Dr 750 To various revenue heads (FC,Usage) Cr 200 To 1196001-Service Tax/Ed cess/SHE cess Payable as per POT Cr 20

To 1194701-SD under recovery Cr 750

1191100 - Advance from Customers Dr 1000 1196401 ST/Cess/SHE Cess payable on advance amount Dr 26 To 1110101/1110509 Sundry Debtors LL/BB etc Cr 200

To 1114401 ST/ED cess/SHE Cess Recoverable as per POT Cr 20 To 1132501-SD recoverable Cr 750 To 1191100 - Advance from Customers Cr 56

The ST payable on advance payment credit will get fully distributed towards any due in the invoice including tax. Surplus, if any, will remain in the same head-ie advance from customers in this case)

The internal payments on account of transfer from deposit, OYT rebate etc. will not be routed to the new GL „1196303 ST/Cess/SHE Cess payable on excess payment „. Excess if any arising in

internal payments will be routed to the existing old GL „1193001 Refund due on Double Excess Pmt‟ Similarly the Tax payable on excess payment and amount of revenue out of excess payment credits

will also be fully adjusted against any due in the next invoice as follow:

1196302 Amount of revenue out of excess payment Dr 1196303 ST/Cess/SHE Cess payable on excess payment as per POT Dr

To 1114401 ST/ED cess/SHE Cess Recoverable as per POT Cr

To Sundry debtor LL/BB etc Cr

In both the cases based on the invoices against which this excess/advance amount is being distributed

ie invoice before 1st August or after 1st August old and new GL codes will be used respectively

Payments: The tax part of payments received are allocated to the respective tax GLcodes depending

on whether the invoice is for the service period before or after 01.07.2011 (ie invoice date is prior to 01.08.2011 or after ).

For invoices issued upto 31.07.11:

TR collection account Dr To sundry debtors etc Cr To ST recoverable (old GL) Cr

To Ed cess recoverable Cr To Higher Ed cess recoverable Cr

For invoices issued from 01.08.2011 onwards: TR collection account Dr

To sundry debtors etc Cr To ST/Ed cess/SHE cess recoverable as per POT Cr


NATFM,HYDERABAD 120

Adjustments: Whenever some adjustment is required due to erroneous billing, deficiency in service, surrender of service or change over to monthly plan before expiry of annual plan etc., adjustments as

follow will happen: Revenue heads Dr 1196001-Service Tax/Ed cess/SHE cess Payable as per POT Dr

To 1194504-Credit memo invoicing account Cr 1194504-Credit memo invoicing account Dr

To Sundry debtor etc Cr To 1114401 ST/ED cess/SHE Cess Recoverable as per POT Cr

In view of some system constraints expressed by SI in knocking off the old tax GL codes for the adjustment happening on invoices prior to 01.08.2011 , a separate report (AnnexureVIII) will be

provided detailing the tax adjustment on such invoices for carrying out manual Journal entry in accounting system.

In case of non-provision of service and refund of the advance payments, following will be the feed to accounting system: 1191100 -Advance from customers Dr

1196401 ST/Cess/SHE Cess payable on advance amount Dr To 1193002-Refund due on closed connections Cr

Write-offs: In case of settlement of account on permanent closure, irrecoverable outstanding tax under „1114401 ST/ED cess/SHE Cess Recoverable as per POT „ , if any, cannot be set off against the liability „1196001-Service Tax/Ed cess/SHE cess Payable as per POT ‟. It has to be set off

against „bad debts‟ only. The accounting entry in respect of this will be as follow:

1742006-Bad debts (old GL) Dr 1742007 Service Tax paid but not collected hence written off Dr To 1110101/1110509 Sundry Debtors LL/BB etc. Cr

To 1114401 ST/ED cess/SHE Cess Recoverable as per POT Cr However tax outstanding for the period prior to the effective date of this amended service tax rules

have to be set off as per the earlier procedure as follow: 1742006-Bad debts Dr 1192301 /1192306 /1192309 Service tax payable (old head) Dr

To 1110101/1110509 Sundry Debtors etc. Cr To 1110901/1110906/1110909 Service tax recoverable (old head) Cr

Reports : There will be a separate SLR report for the GL „1114401 ST/ED cess/SHE Cess Recoverable as per POT ‟ head including age-wise break up etc. In addition following reports will also be provided to comply with the Service tax Audit requirements :

1. Invoice –wise details of tax raised – (Annexure-I)

2. Details of advance payments and advance tax- (Annexure-II)

3. Details of excess payments and tax on excess payment (Annexure-III).

4. Details of adjustments carried out-(annexure-IV)

5. Billing/Adjustment details of service tax payable on advance payments –(Annexure-V)

6. Billing/adjustment details of service tax payable on excess payments.(Annexure-VI) 7. Details of annual plan charges billed during the bill cycle (annexure –VII). 8. Details of adjustments on invoices issued before 01.08.11 but debited to POT tax payable

GL(Annexure-VIII) 9. Summary of Annexure-I to VI


NATFM,HYDERABAD 121

Summary of Annexure-I to VI

Summary statement of Service tax payable for the month of ---------------

SSA:

Sl Details Amount (Rs) Remarks

1 Total tax billed through invoices as per annexure-I

2 Add: Tax on Advance pmt received as per annexure-II

3 Add: Tax on excess payment received as per annexure-III

4 Less: Adjustments carried out during the month-Annexure-IV(on inv fm 1.8.11)

5 Less: Tax on Advance pmt billed/adjusted during the month-Annexure-V

6 Less:Tax on excess pmt billed/adjusted during the month-Annexure-VI

7 Net Service Tax/Ed cess/SHE cess Payable as per POT(1+2+3-4-5-6)

Break up: Service tax ?% Education Cess ?% Higher Education Cess ?%

Total

With this , tax payable on realisation basis for the invoices issued prior to 01.08.2011 also has to be

added ( based on separate SLR ) and Tax payment to service tax authorities regularised.

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