SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) September 28, 1995
GTE SOUTH INCORPORATED
(Exact name of registrant as specified in its charter)
Virginia 2-36292 56-0656680
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
600 Hidden Ridge, HQE04B12 - Irving, Texas 75038
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 214-718-5600
19845 N. U.S. 31, P.O. Box 407, Westfield, Indiana 46074
(Former name or former address, if changed since last report)
GTE SOUTH INCORPORATED
FORM 8-K
ITEM OF INFORMATION
Item 5. Other Events
GTE South Incorporated follows the accounting for regulated enterprises
prescribed by Statement of Financial Accounting Standards No. 71, "Accounting
for the Effects of Certain Types of Regulation" (FAS 71). In general, FAS 71
requires companies to depreciate plant and equipment over lives approved by
regulators which may extend beyond the assets' actual economic life. FAS 71
also requires deferral of certain costs based upon approvals received from
regulators to recover such costs in the future. Consequently, the carrying
value of certain assets and liabilities, primarily telephone plant and
equipment, may be greater than that which would otherwise be recorded by
unregulated enterprises.
In connection with an ongoing review of the continued applicability of FAS 71,
the Company has commenced a study of the economic lives of its telephone plant
and equipment. The study is expected to be completed by the end of the fourth
quarter of 1995. If the Company were to discontinue the application of FAS 71
and compute the effect on its telephone plant in a manner similar to the seven
Regional Bell Operating Companies who discontinued FAS 71, the after-tax
charge resulting from the reduction in carrying value of the Company's
property, plant and equipment, which would be non-cash in nature, is estimated
to be between $300 million and $500 million. This potential accounting charge
would reduce telephone plant but would not have a significant effect on future
depreciation. In addition, this charge would have no effect on the Company's
customers or its liquidity and capital resources.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GTE SOUTH INCORPORATED
(Registrant)
Date: October 2, 1995 BY WILLIAM M. EDWARDS, III
WILLIAM M. EDWARDS, III
Controller
(Chief Accounting Officer)
