Fibre-to-the-Home (FTTH) Monthly Revenue
Recognizing monthly subscription revenue from a residential FTTH connection.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Accounts Receivable (FTTH) | Asset (+) | 45.00 | - |
| Fibre / FTTH Revenue | Revenue (+) | - | 45.00 |
💡 Accountant's Note
FTTH is a premium broadband product requiring significant upfront capex for fibre deployment. Monthly revenue is recognized as connectivity is provided. The high capex-to-revenue ratio makes FTTH a long-payback investment.
Practitioner & Systems Framework
💻 ERP Architecture
FTTH revenue is recognised monthly per active subscriber. The FTTH network build (fibre cables, ONT equipment, active electronics) is capitalised as network PPE during the construction phase and depreciated over its useful life (fibre: 20-30 years; active equipment: 7-10 years). Home connection costs (drop cables, ONT at the subscriber premise) may be capitalised as subscriber connection assets or expensed depending on the operator's policy and whether the operator retains ownership of the ONT equipment. Revenue recognition commences when the subscriber is connected and service is active.
⚠️ Audit Flags
Auditors assess the capex-to-revenue payback period for the FTTH programme — where payback is very long (over 10 years), impairment indicators should be considered. Confirm that civil construction costs (trench works, duct installation) are capitalised and not expensed. Test the ONT capitalisation policy — if ONTs are provided to subscribers at no charge, the cost may be an upfront cost that should be recognised as a contract cost or an asset depending on ownership. Test the revenue start date aligns with the connection date in the network management system.
📄 Required Documentation
FTTH capex register (fibre, active equipment, civil works), subscriber connection date from NMS, revenue recognition start date, ONT capitalisation policy assessment, FTTH programme financial model (payback period), impairment indicators assessment, and FTTH segment financial statements.
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Expert Analysis by Qusai Ahmad
General Accountant Supervisor & IFRS Specialist
Specialized in SAP GUI automation and Middle Eastern tax compliance. Building digital tools for the next generation of finance leaders.