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Telecom Public Notice
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Ottawa, 24 July 1992
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Telecom Public Notice CRTC 92-41
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BELL CANADA - PROPOSED MODIFICATIONS TO THE EQUAL LIFE GROUP METHOD OF DEPRECIATION FOR CERTAIN ASSETS
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The Commission has received an application from Bell Canada (Bell), dated 12 May 1992, for approval of proposed modifications to the equal life group (ELG) method used in depreciating certain assets.
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In the proceeding initiated by Bell Canada - 1992 Construction Program Review, Telecom Public Notice CRTC 92-8, 18 February 1992 (Public Notice 92-8), the Commission is considering Bell's plan to complete its Switching Equipment Modernization (SEM) program by the end of 1994, rather than in 1997. In its application of 12 May 1992, Bell states that, in the event that the SEM program is completed by the end of 1994, a total of $340 million in undepreciated investment in analogue switching equipment would have to be recovered using the ELG method. Bell estimates that the accruals would be approximately $230 million in 1993 and $110 million in 1994. In its application, Bell proposes to depreciate its investment in analogue equipment as of 31 December 1992 in two equal amounts of approximately $170 million during each of 1993 and 1994.
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Bell also states that it would anticipate salvage proceeds of approximately $40 million in 1992, $75 million in 1993 and a smaller undetermined amount in 1994. The company proposes to treat the salvage proceeds as realized, consistent with the existing practice.
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In this proceeding, the Commission invites comment on Bell's proposed depreciation and salvage treatment. A determination regarding the reasonableness of advancing the SEM program completion from 1997 to 1994 will be made in the proceeding initiated by Public Notice 92-8.
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The application may be examined at any of Bell's business offices or at the offices of the CRTC, Room 201, Central Building, Les Terrasses de la Chaudière, 1 Promenade du Portage, Hull, Quebec, or Complex Guy-Favreau, 200 René-Lévesque Blvd. West, East Tower, Montréal, Quebec. A copy of Bell's application may be obtained by any interested person upon request directed to the company at the address shown below.
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If you wish to comment on the application, please write to Mr. Allan J. Darling, Secretary General, CRTC, Ottawa, Ontario, K1A 0N2, by 24 August 1992 (fax: 819-953-0795). A copy of your letter should be sent to Mr. B.A. Courtois, Vice-President, Law & Regulatory Affairs, Bell Canada, 6th Floor, 105 Hôtel-de-ville Street, Hull, Quebec, J8X 4H7 (fax: 819-778-3437).
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Allan J. Darling
Secretary General
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