Number Portability — Revenue Impact (Subscriber Loss)
Recognizing the revenue impact when a high-value subscriber ports out to a competitor.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Deferred Revenue (Remaining Contract) | Liability (-) | - | - |
| Revenue Reversal (Early Termination) | Revenue (-) | 50.00 | - |
| Accounts Receivable (Early Termination Fee) | Asset (+) | 50.00 | - |
💡 Accountant's Note
When a subscriber ports out before contract end, the early termination fee (ETF) is charged and recognized. Any remaining deferred revenue for undelivered service is reversed.
Practitioner & Systems Framework
💻 ERP Architecture
When a port-out is initiated, the CBS triggers the ETF calculation based on the remaining contract period and the plan's ETF schedule. The ETF is posted as a receivable and revenue in the CBS. Simultaneously, any deferred service revenue attributable to the remaining contract period is reversed. The subscriber's account is closed in the CBS on the effective porting date. The revenue accounting system handles the deferred revenue reversal based on the contract closeout event. The unamortised CAC contract asset is also written off at the point of porting.
⚠️ Audit Flags
Auditors confirm that ETF revenue is recognised at the point of porting (not when collected) as the constraint on variable consideration is removed. Test that the deferred revenue reversal matches the remaining months of the contract. Confirm that the CAC contract asset write-off is triggered simultaneously with the port-out event. Review ETF collectability — ETFs are often difficult to collect and may require provision. Assess whether the ETF amount complies with regulatory maximum limits on early termination charges.
📄 Required Documentation
Port-out notification from the MNP system, ETF calculation per the contract terms, ETF receivable posting, deferred revenue reversal journal, CAC contract asset write-off, ETF collection history and provision assessment, and TRC ETF regulatory limit compliance.
Automate this entry with the JEH Accounting Suite
Stop doing manual entry. Our VBA-powered ERP automatically generates your ledgers, Trial Balance, and Financial Statements.
No Subscriptions. Own your data.
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.