Published: 06-12-08
Regulated Industries to Study Accounting Standards
AUSTIN-- Today Rep. Wayne Christian (R-Center) was named Chairman of the Subcommittee for Interim Charge #5 in the House Committee on Regulated Industries by Chairman Phil King.
When Speaker Tom Craddick announced the Interim Studies for the House last November he charged Regulated Industries to study and examine whether Generally Accepted Accounting Principles (GAAP) should be adhered to under Chapter 66 of the Public Utility Regulatory Act (PURA) and to review procedures for revenue audits. Rep. John Smithee and Rep. Sylvester Turner will also serve on the subcommittee.
Under current statute cable and video service providers must pay municipalities a franchise fee for use of the public rights-of-way for the infrastructure needed to service area customers. The quarterly fee consists of five percent based on gross revenue made within municipal boundaries.
I appreciate Chairman King giving me this opportunity and I am honored to chair this important study Christian responded. It has become clear that many disputes have arisen on how to calculate gross revenue. The goal of this subcommittee will be to determine if adopting the GAAP as a statewide model would be the best option to resolve disagreements between municipalities and service providers.
Established by the Financial Accounting Standards Board the Generally Accepted Accounting Principles are a combination of widely accepted rules standards and procedures employed by companies for the purpose of reporting financial information. The United States Securities and Exchange Commission provides guidance for the formulation of the U.S. GAAP.
It is my hope that through this interim study we can bring clarity to the process of reporting gross revenue and eliminate the questionable gray areas so that municipalities and service providers both benefit from fair and consistent guidelines said Christian.
