Revenues derived from wireless, local telephone, long distance, data and video services are recognized when services are provided. This is based upon either usage (e.g., minutes of traffic/bytes of data processed), period of time (e.g., monthly service fees) or other established fee schedules. AT&T's wireless service revenues are billed either in advance, arrears or are prepaid.
AT&T records an estimated revenue reduction for future adjustments to customer accounts, other than bad debt expense, at the time revenue is recognized based on historical experience. Service revenues also include billings to customers for various regulatory fees imposed on AT&T by governmental authorities. Cash incentives given to customers are recorded as a reduction of revenue. When required as part of providing service, revenues and associated expenses related to nonrefundable, upfront service activation and setup fees are deferred and recognized over the associated service contract period or customer life. Associated expenses are deferred only to the extent of such deferred revenue. For contracts that involve the bundling of services, revenue is allocated to the services based on their relative selling price, subject to the requirement that revenue recognized is limited to the amounts already received from the customer that are not contingent upon the delivery of additional products or services to the customer in the future. AT&T records the sale of equipment to customers as gross revenue when AT&T is the primary obligor in the arrangement, when title is passed and when the products are accepted by customers. For agreements involving the resale of third-party services in which AT&T is not considered the primary obligor of the arrangement, AT&T records the revenue net of the associated costs incurred. For contracts in which AT&T provides customers with an indefeasible right to use network capacity, AT&T recognizes revenue ratably over the stated life of the agreement.
Source: AT&T Inc., Annual Report
AT&T Inc., Income Statement, Revenues
USD $ in millions
|12 months ended||Dec 31, 2012||Dec 31, 2011||Dec 31, 2010||Dec 31, 2009||Dec 31, 2008|
Source: AT&T Inc. Annual Reports
|Operating revenues||Aggregate revenue recognized during the period (derived from goods sold, services rendered, insurance premiums, or other activities that constitute an entity's earning process). For financial services companies, also includes investment and interest income, and sales and trading gains.||AT&T Inc.'s operating revenues increased from 2010 to 2011 and from 2011 to 2012.|