TELSTRA GROUP LIMITED — Audit Report / Information 2003

Dec 21, 2003

22 December 2003

The Manager

Company Announcements Office Australian Stock Exchange 10th Floor, 20 Bond Street SYDNEY NSW 2000

Office of the Company Secretary

Level 41 242 Exhibition Street MELBOURNE VIC 3000 AUSTRALIA

Telephone 03 9634 6400 Facsimile 03 9632 3215

ELECTRONIC LODGEMENT

Dear Sir or Madam

Accounting separation data demonstrates wholesale customers get a fair go

In accordance with the listing rules, I attach an announcement for release to the market.

Yours sincerely

Pont Grati

Douglas Gration Company Secretary

Telstra Corporation Limited ACN 051 775 556 ABN 33 051 775 556

Media Release

22 December 2003

406/2003

Accounting separation data demonstrates wholesale customers get a fair go

Telstra today announced that the data it had provided to the ACCC in relation to the Federal Government's Accounting Separation requirements demonstrated it provides fair conditions for its wholesale customers.

Telstra Group Managing Director of Regulatory Corporate and Human Relations Bill Scales said Telstra welcomed the opportunity to provide all relevant data to the ACCC as it countered claims by Telstra's competitors that Telstra had been discriminating against them.

"The data demonstrates that Telstra gives its competitors a fair go," Mr Scales said.

"The data provided to the ACCC increases the transparency of Telstra's pricing and its service arrangements."

Mr Scales said the data showed that service providers who purchase from Telstra at wholesale prices and resell in retail markets are able to make satisfactory returns across the suite of the most popular telephony services.

"On the spread of the most popular calling products, an overall margin of 14 per cent is available to our wholesale service providers.

"In relation to service provision, the data shows there is no pattern of favoritism of retail customers over wholesale customers," he said.

Telstra will collect and release accounting separation data each quarter.

The first quarter data is published at: www.telstra.com.au/communications/corp/accounting.cfm

Telstra Media Contact: Rod Bruem Tel: 02 9206 0092 Mbl: 0438 288 010

Telstra's national media inquiry line is 13 1639 and the Media Centre is located at: www.telstra.com.au/communications/media

Telstra

EXED ASSET STATEMENT -EXTERNAL WHOLESALE ELENESS

CCA (Initial Reports) December 2002 (HCA v CCA)	Unconditional Local Loop (Declared)			Domestic PSTN Origin/Term (Declared)		Local Carriage Services (Declared)
values in \$m's	Dec-02-HCA	Dec-02-CCA	Change	Dec-02-HCA	Dec-02-CCA	Change	Dec-02-HCA	Dec-02-CCA	Change
Wholesale Fixed Assets
2-1 Communications Plant & Equipment	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-01 CAN Ducts & Pipes - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-01-1 Historical/Revalued Value	4.6	12.4	7.8	38.8	204.9	166.0	469.8	1,386.6	916.8
2-1-01-2 Accumulated Depreciation	(1.6)	(4.6)	(3.0)	(15.7)	(83.4)	(67.7)	(163.2)	(520.8)	(357.6)
2-1-02 CAN Ducts & Pipes - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-02-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-02-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-05 CAN Copper Cables - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-05-1 Historical/Revalued Value	5.8	8.6	2.7	0.0	0.0	0.0	545.5	799.7	254.2
2-1-05-2 Accumulated Depreciation	(2.6)	(3.9)	(1.3)	0.0	0.0	0.0	(241.1)	(367.1)	(126.0)
2-1-06 CAN Copper Cables - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-06-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-06-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-10 CAN Other Cables - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-10-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-10-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-11 CAN Other Cables - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-11-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-11-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-15 CAN Pair Gain Systems - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-15-1 Historical/Revalued Value	1.9	2.2	0.2	5.3	6.0	0.7	187.8	210.6	22.9
2-1-15-2 Accumulated Depreciation	(0.8)	(1.0)	(0.1)	(2.8)	(3.3)	(0.6)	(80.7)	(93.0)	(12.3)
2-1-16 CAN Pair Gain Systems - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-16-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-16-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-20 CAN Radio Bearer Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-20-1 Historical/Revalued Value	0.8	1.4	0.6	0.0	0.0	0.0	75.7	127.7	52.0
2-1-20-2 Accumulated Depreciation	(0.4)	(0.7)	(0.3)	0.0	0.0	0.0	(35.1)	(66.3)	(31.2)
2-1-21 CAN Radio Bearer Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0

CCA (Initial Reports) December 2002 (HCA v CCA)	Unconditional Local Loop (Declared)			Domestic PSTN Origin/Term (Declared)		Local Carriage Services (Declared)
values in \$m's	Dec-02-HCA	Dec-02-CCA	Change	Dec-02-HCA	Dec-02-CCA	Change	Dec-02-HCA	Dec-02-CCA	Change
2-1-21-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-21-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-25 Other CAN - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-25-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-25-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-26 Other CAN - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-26-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-26-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-30 Switching Equipment - Local - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-30-1 Historical/Revalued Value	0.0	0.0	0.0	537.3	469.9	(67.5)	762.4	677.7	(84.7)
2-1-30-2 Accumulated Depreciation	0.0	0.0	0.0	(289.8)	(254.5)	35.3	(428.2)	(384.0)	44.2
2-1-31 Switching Equipment - Local - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-31-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-31-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-35 Switching Equipment - Trunk - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-35-1 Historical/Revalued Value	0.0	0.0	0.0	13.7	13.7	0.0	5.0	5.0	0.0
2-1-35-2 Accumulated Depreciation	0.0	0.0	0.0	(7.7)	(7.7)	0.0	(2.4)	(2.4)	0.0
2-1-36 Switching Equipment - Trunk - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-36-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-36-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-40 Switching Equipment - Other - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-40-1 Historical/Revalued Value	0.0	0.0	0.0	0.1	0.1	0.0	0.0	0.0	0.0
2-1-40-2 Accumulated Depreciation	0.0	0.0	0.0	(0.0)	(0.0)	0.0	0.0	0.0	0.0
2-1-41 Switching Equipment - Other - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-41-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-41-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-45 Inter-exchange Cables - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-45-1 Historical/Revalued Value	1.0	0.9	(0.1)	97.1	85.7	(11.4)	171.9	151.8	(20.1)
2-1-45-2 Accumulated Depreciation	(0.3)	(0.3)	0.0	(31.1)	(27.4)	3.6	(55.0)	(48.6)	6.5
2-1-46 Inter-exchange Cables - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-46-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-46-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-50 Transmission Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-50-1 Historical/Revalued Value	0.1	0.1	(0.0)	171.2	151.3	(19.9)	198.6	175.5	(23.1)
2-1-50-2 Accumulated Depreciation	(0.0)	(0.0)	0.0	(73.4)	(63.2)	10.3	(85.2)	(73.3)	11.9
2-1-51 Transmission Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0

CCA (Initial Reports) December 2002 (HCA v CCA)	Unconditional Local Loop (Declared)			Domestic PSTN Origin/Term (Declared)		Local Carriage Services (Declared)
values in \$m's	Dec-02-HCA	Dec-02-CCA	Change	Dec-02-HCA	Dec-02-CCA	Change	Dec-02-HCA	Dec-02-CCA	Change
2-1-51-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-51-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-55 Radio Bearer Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-55-1 Historical/Revalued Value	0.1	0.1	0.0	21.0	21.0	0.0	35.3	35.3	0.0
2-1-55-2 Accumulated Depreciation	(0.1)	(0.1)	0.0	(8.5)	(8.5)	0.0	(14.3)	(14.3)	0.0
2-1-56 Radio Bearer Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-56-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-56-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-60 Data Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-60-1 Historical/Revalued Value	(0.0)	(0.0)	0.0	0.7	0.7	0.0	0.8	0.8	0.0
2-1-60-2 Accumulated Depreciation	0.0	0.0	0.0	(0.2)	(0.2)	0.0	(0.2)	(0.2)	0.0
2-1-61 Data Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-61-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-61-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-65 Mobile Network and Terminal Equipment - Primary /	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-65-1 Historical/Revalued Value	0.1	0.1	0.0	6.0	6.0	0.0	15.6	15.6	0.0
2-1-65-2 Accumulated Depreciation	(0.1)	(0.1)	0.0	(6.0)	(6.0)	0.0	(15.6)	(15.6)	0.0
2-1-66 Mobile Network and Terminal Equipment - Other As	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-66-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-66-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-70 Customer Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-70-1 Historical/Revalued Value	0.0	0.0	0.0	1.4	1.4	0.0	3.7	3.7	0.0
2-1-70-2 Accumulated Depreciation	(0.0)	(0.0)	0.0	(1.2)	(1.2)	0.0	(3.0)	(3.0)	0.0
2-1-71 Customer Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-71-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-71-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-75 Satellite Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-75-1 Historical/Revalued Value	0.0	0.0	0.0	1.0	1.0	0.0	2.5	2.5	0.0
2-1-75-2 Accumulated Depreciation	(0.0)	(0.0)	0.0	(0.7)	(0.7)	0.0	(1.8)	(1.8)	0.0
2-1-76 Satellite Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-76-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-76-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-80 International Network Cables - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-80-1 Historical/Revalued Value	(0.0)	(0.0)	0.0	(0.0)	(0.0)	0.0	(0.0)	(0.0)	0.0
2-1-80-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-81 International Network Cables - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0

CCA (Initial Reports) December 2002 (HCA v CCA)		Unconditional Local Loop (Declared)		Domestic PSTN Origin/Term (Declared)			Local Carriage Services (Declared)
values in \$m's	Dec-02-HCA	Dec-02-CCA	Change	Dec-02-HCA	Dec-02-CCA	Change	Dec-02-HCA	Dec-02-CCA	Change
2-1-81-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-81-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-85 International Network - Other Systems - Primary Ass	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-85-1 Historical/Revalued Value	0.0	0.0	0.0	0.8	0.8	0.0	2.2	2.2	0.0
2-1-85-2 Accumulated Depreciation	(0.0)	(0.0)	0.0	(0.8)	(0.8)	0.0	(2.0)	(2.0)	0.0
2-1-86 International Network - Other Systems - Other Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-86-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-86-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-90 Other Communications Plant & Equipment - Primary	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-90-1 Historical/Revalued Value	(0.0)	(0.0)	0.0	3.4	3.4	0.0	1.5	1.5	0.0
2-1-90-2 Accumulated Depreciation	0.0	0.0	0.0	0.1	0.1	0.0	1.5	1.5	0.0
2-1-91 Other Communications Plant & Equipment - Other A	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-91-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-91-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
Total Communications Plant & Equipment	8.6	15.0	6.4	460.2	509.0	48.8	1,351.9	2,005.4	653.5
2-2 Non-Communications Plant & Equipment	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-2-01-4 Information Technology	0.0	0.0	(0.0)	1.3	1.7	0.4	3.0	2.9	(0.1)
2-2-03-4 Buildings and Improvements	0.1	0.1	0.0	8.9	9.1	0.1	17.4	17.4	0.0
2-2-05-4 Other	0.0	0.0	0.0	1.3	2.0	0.7	2.4	2.6	0.2
Total Non-Communications Plant & Equipement	0.2	0.2	(0.0)	11.6	12.8	1.3	22.8	22.9	0.1
2-3 Other Non-Current Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-3-01-4 Long term receivables	0.1	0.1	(0.0)	7.5	11.5	4.0	9.9	7.9	(2.0)
2-3-05-4 Long term investment	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-3-10-4 Intangibles	(0.0)	(0.0)	0.0	(0.0)	(0.0)	0.0	(0.0)	(0.0)	0.0
2-3-20-4 Land	0.0	0.0	0.0	3.0	3.5	0.5	5.8	5.9	0.1
2-3-25-4 Other	0.6	0.6	0.0	21.9	32.6	10.7	40.4	42.8	2.3
Total Other Non-Current Assets	0.8	0.8	(0.0)	32.4	47.6	15.2	56.1	56.5	0.5
			0.0			0.0			0.0
Total Fixed Assets	9.6	16.0	6.4	504.1	569.4	65.3	1,430.8	2.084.9	654.0

Telstra

EIXED ASSERS FATEMENT -EXTENAL WIDESALE ENSINESS

CCA (Initial Reports) June 2003 (HCA v CCA)		Unconditional Local Loop (Declared)		Domestic PSTN Origin/Term (Declared)			Local Carriage Services (Declared)
values in \$m's	Jun-03-HCA	Jun-03-CCA	Change	Jun-03-HCA	Jun-03-CCA	Change	Jun-03-HCA	Jun-03-CCA	Change
Wholesale Fixed Assets
2-1 Communications Plant & Equipment	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-01 CAN Ducts & Pipes - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-01-1 Historical/Revalued Value	5.2	13.9	8.7	37.4	194.7	157.3	550.9	1,593.3	1.042.4
2-1-01-2 Accumulated Depreciation	(1.8)	(5.1)	(3.4)	(15.2)	(79.1)	(64.0)	(190.8)	(600.0)	(409.2)
2-1-02 CAN Ducts & Pipes - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-02-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-02-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-05 CAN Copper Cables - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-05-1 Historical/Revalued Value	6.6	9.6	3.0	0.0	0.0	0.0	634.5	929.2	294.6
2-1-05-2 Accumulated Depreciation	(2.9)	(4.5)	(1.6)	0.0	0.0	0.0	(285.1)	(439.8)	(154.7)
2-1-06 CAN Copper Cables - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-06-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-06-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-10 CAN Other Cables - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-10-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-10-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-11 CAN Other Cables - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-11-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-11-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-15 CAN Pair Gain Systems - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-15-1 Historical/Revalued Value	2.2	2.5	0.3	4.9	5.6	0.7	220.9	249.1	28.2
2-1-15-2 Accumulated Depreciation	(1.0)	(1.1)	(0.2)	(2.7)	(3.3)	(0.6)	(96.8)	(114.0)	(17.2)
2-1-16 CAN Pair Gain Systems - Other Assets 2-1-16-1 Historical/Revalued Value	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0
2-1-16-2 Accumulated Depreciation 2-1-20 CAN Radio Bearer Equipment - Primary Asset	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0	0.0 0.0
2-1-20-1 Historical/Revalued Value	1.0	1.6	0.6	0.0	0.0	0.0	92.5	154.7	62.2
2-1-20-2 Accumulated Depreciation	(0.4)	(0.9)	(0.4)	0.0	0.0	0.0	(42.5)	(83.2)	(40.8)
2-1-21 CAN Radio Bearer Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-21-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-21-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0

CCA (Initial Reports) June 2003 (HCA v CCA)	Unconditional Local Loop (Declared)			Domestic PSTN Origin/Term (Declared)		Local Carriage Services (Declared)
values in \$m's	Jun-03-HCA	Jun-03-CCA	Change	Jun-03-HCA	Jun-03-CCA	Change	Jun-03-HCA	Jun-03-CCA	Change
2-1-25 Other CAN - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-25-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-25-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-26 Other CAN - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-26-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-26-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-30 Switching Equipment - Local - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-30-1 Historical/Revalued Value	0.0	0.0	0.0	535.4	463.4	(72.1)	880.9	775.4	(105.5)
2-1-30-2 Accumulated Depreciation	0.0	0.0	0.0	(301.3)	(262.1)	39.2	(520.0)	(462.7)	57.3
2-1-31 Switching Equipment - Local - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-31-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-31-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-35 Switching Equipment - Trunk - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-35-1 Historical/Revalued Value	0.0	0.0	0.0	13.7	13.7	0.0	5.2	5.2	0.0
2-1-35-2 Accumulated Depreciation	0.0	0.0	0.0	(8.4)	(8.4)	0.0	(2.8)	(2.8)	0.0
2-1-36 Switching Equipment - Trunk - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-36-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-36-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-40 Switching Equipment - Other - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-40-1 Historical/Revalued Value	0.0	0.0	0.0	0.1	0.1	0.0	0.0	0.0	0.0
2-1-40-2 Accumulated Depreciation	0.0	0.0	0.0	(0.0)	(0.0)	0.0	0.0	0.0	0.0
2-1-41 Switching Equipment - Other - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-41-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-41-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-45 Inter-exchange Cables - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-45-1 Historical/Revalued Value	1.0 (0.3)	0.8	(0,1) 0.0	114.2	98.7	(15.4) 5.2	200.2	173.1	(27.1) 9.1
2-1-45-2 Accumulated Depreciation 2-1-46 Inter-exchange Cables - Other Assets	0.0	(0.3) 0.0	0.0	(37.2) 0.0	(32.0) 0.0	0.0	(65.2) 0.0	(56.1) 0.0	0.0
2-1-46-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-46-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-50 Transmission Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-50-1 Historical/Revalued Value	0.1	0.1	(0.0)	166.6	141.6	(25.1)	222.6	189.1	(33.5)
2-1-50-2 Accumulated Depreciation	(0.0)	(0.0)	0.0	(75.9)	(63.5)	12.4	(101.3)	(84.8)	16.6
2-1-51 Transmission Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-51-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-51-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-55 Radio Bearer Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-55-1 Historical/Revalued Value	0.2	0.2	0.0	25.9	25.9	0.0	50.1	50.1	0.0

CCA (Initial Reports) June 2003 (HCA v CCA)	Unconditional Local Loop (Declared)		Domestic PSTN Origin/Term (Declared)			Local Carriage Services (Declared)
values in \$m's	Jun-03-HCA	Jun-03-CCA	Change	Jun-03-HCA	Jun-03-CCA	Change	Jun-03-HCA	Jun-03-CCA	Change
2-1-55-2 Accumulated Depreciation	(0.1)	(0.1)	0.0	(13.9)	(13.9)	0.0	(26.9)	(26.9)	0.0
2-1-56 Radio Bearer Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-56-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-56-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-60 Data Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-60-1 Historical/Revalued Value	(0.0)	(0.0)	0.0	0.2	0.2	0.0	0.3	0.3	0.0
2-1-60-2 Accumulated Depreciation	0.0	0.0	0.0	(0.1)	(0.1)	0.0	(0.1)	(0.1)	0.0
2-1-61 Data Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-61-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-61-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-65 Mobile Network and Terminal Equipment - Primary	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-65-1 Historical/Revalued Value	0.1	0.1	0.0	5.9	5.9	0.0	17.8	17.8	0.0
2-1-65-2 Accumulated Depreciation	(0.1)	(0.1)	0.0	(5.9)	(5.9)	0.0	(17.8)	(17.8)	0.0
2-1-66 Mobile Network and Terminal Equipment - Other As	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-66-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-66-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-70 Customer Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-70-1 Historical/Revalued Value	0.0	0.0	0.0	1.3	1.3	0.0	3.8	3.8	0.0
2-1-70-2 Accumulated Depreciation	(0.0)	(0.0)	0.0	(1.2)	(1.2)	0.0	(3.5)	(3.5)	0.0
2-1-71 Customer Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-71-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-71-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-75 Satellite Equipment - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-75-1 Historical/Revalued Value	0.0	0.0	0.0	0.9	0.9	0.0	2.7	2.7	0.0
2-1-75-2 Accumulated Depreciation	(0.0)	(0.0)	0.0	(0.7)	(0.7)	0.0	(2.1)	(2.1)	0.0
2-1-76 Satellite Equipment - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-76-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-76-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-80 International Network Cables - Primary Asset	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-80-1 Historical/Revalued Value	(0.0)	(0.0)	0.0	(0.0)	(0.0)	0.0	(0.0)	(0.0)	0.0
2-1-80-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-81 International Network Cables - Other Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-81-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-81-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-85 International Network - Other Systems - Primary As	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-85-1 Historical/Revalued Value	0.0	0.0	0.0	0.7	0.7	0.0	2.1	2.1	0.0
2-1-85-2 Accumulated Depreciation	(0.0)	(0.0)	0.0	(0.6)	(0.6)	0.0	(1.9)	(1.9)	0.0
2-1-86 International Network - Other Systems - Other Asse	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0

CCA (Initial Reports) June 2003 (HCA v CCA)		Unconditional Local Loop (Declared)			Domestic PSTN Origin/Term (Declared)			Local Carriage Services (Declared)
values in \$m's	Jun-03-HCA	Jun-03-CCA	Change	Jun-03-HCA	Jun-03-CCA	Change	Jun-03-HCA	Jun-03-CCA	Change
2-1-86-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-86-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-90 Other Communications Plant & Equipment - Primar	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-90-1 Historical/Revalued Value	0.1	0.1	0.0	3.0	3.0	0.0	9.1	9.1	0.0
2-1-90-2 Accumulated Depreciation	0.0	0.0	0.0	0.5	0.5	0.0	1.4	1.4	0.0
2-1-91 Other Communications Plant & Equipment - Other A	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-91-1 Historical/Revalued Value	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-1-91-2 Accumulated Depreciation	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
Total Communications Plant & Equipment	9.6	16.6	7.0	447.6	485.3	37.6	1,538.3	2,260.8	722.5
2-2 Non-Communications Plant & Equipment	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-2-01-4 Information Technology	0.0	0.0	(0.0)	1.3	1.6	0.2	3.6	3.5	(0.1)
2-2-03-4 Buildings and Improvements	0.1	0.1	0.0	8.8	8.8	0.0	17.1	17.1	0.0
2-2-05-4 Other	0.0	0.0	(0.0)	0.7	1.0	0.2	2.3	2.3	(0.0)
Total Non-Communications Plant & Equipement	0.2	0.2	(0.0)	10.8	11.3	0.5	23.0	22.8	(0.1)
2-3 Other Non-Current Assets	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-3-01-4 Long term receivables	0.3	0.2	(0.0)	6.9	10.1	3.2	21.2	19.5	(1.7)
2-3-05-4 Long term investment	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
2-3-10-4 Intangibles	(0.0)	(0.0)	0.0	(0.0)	(0.0)	(0.0)	(0.0)	(0.0)	(0.0)
2-3-20-4 Land	0.0	0.0	(0.0)	1.9	2.1	0.2	4.7	4.7	(0.0)
2-3-25-4 Other	0.7	0.6	(0.0)	22.4	28.2	5.8	63.3	62.8	(0.5)
Total Other Non-Current Assets	0.9	0.9	(0.1)	31.3	40.5	9.2	89.2	87.0	(2.3)
			0.0			0.0			0.0
Total Fixed Assets	10.8	17.7	6.9	489.7	537.0	47.3	1.650.5	2,370.6	720.1

SCHEDULE A

Table - 1 Report for September 03 Quarter on historic cost basis

	Local carriage service			Domestic PSTN or elhaunceare terminating access services			Domestic PSTN originating access service			Total Bundle of Fixed Voice Products
	Local cals and Line rental			Domestic long distance		International long CISERES	Eixed to mobile			Emm
	EUSINESS	Residential	Business	Residential	Business	दिवेडीलक्षेत्री हो	Enginess	Residential	Eusiness	Residenta l	រសេងា
Revenues
तवता	359,611,167	606,674,510	85,582,858	203,686,835	13,404,619	56,250,383	193,328,103	204,072,496	651,926,747	1,070,684,224	1,722,610,971
olith	n	Λ	0.	0	0.	∩	Λ.	$\Omega$	0.		0
toal	359,611,167	606,674,510	85,582,858	203,686,835	13,404,619	56,250,383	193,328,103	204,072,496	651,926,747	1,070,684,224	1,722,610,971
Retail Costs
oransalon	21,898,549	49,822,665	3,370,145	10,257,196	872,402	4,609,375	6,626,362	5,621,567	32,767,458	70,310,804	103,078,262
sproculat and
consumer	21.874.693	47.652.250	6.417.786	19,532,835	6.143.570	32,459,823	130.390.048	110.618.224	164.826.096	210.263.132	375,089,228
STOPPIT	43,773,241	97,474,915	9,787,931	29,790,032	7,015,972	37,069,197	137,016,410	116,239,791	197,593,554	280,573,936	478,167,490
Olier Costs organisation	$\Omega$	$\Omega$	730,892	2,224,505	113,048	597,296	1,405,786	1,192,618	2,249,726	4,014,419	6,264,146
product and consumer	$\overline{0}$	0	18,799	57,215	3,124	16,508	165,403	140,322	187,326	214,045	401,371
matyone expenses	$\Omega$	0	4.456.166	13,562,553	615,161	3,250,231	6,300,285	5,344,935	11,371,612	22,157,719	33,529,331
स्टब्स	$\overline{0}$	0	5,205,857	15,844,272	731,334	3,864,036	7,871,474	6,677,875	13,808,665	26.386.183	40,194,848
Real price	139.58	99.42	0.16	0.12 0.02	0.52	0.41	0.35	0.43	253 139	175	198
Access price Unit cost	129.87 16.99	90.62 15.97	0.03 0.03	0.03	0.01 0.30	0.01 0.30	0.02 0.26	0.02 0.26	82	99 50	111 60
monted
marcine	$-7.28$	$-7.17$	0.10	0.07	0.21	0.10	0.07	0.16	32	27	28
moned neitelni Z	$-5%$	$-7%$	64%	58%	40%	24%	21%	36%	12%	15%	14%

SCHEDULE A

Table - 2 Report for September 03 Quarter on current cost basis

	Local carriage service			Domestic PSTN Cremento entre terminating access services			Domestic PSTN originating access service			Total Bundle of Exed Voice Products
	Local calls and Line rental			Domestic long distance		International long		Fixed to mobile		Bundle
	Business	Residential	Business	Residential	Eusiness	distinct Residential	Ettempts	Residential	Eushess	Residential	maa
Revenues
maan	359.611.167	606,674,510	85,582,858	203,686,835	13,404,619	56,250,383	193,328,103	204,072,496	651,926,747	1,070,684,224	1,722,610,971
other		Ω	0.	0	n		0.	∩	∩		Ω
toal	359,611,167	606,674,510	85,582,858	203,686,835	13,404,619	56,250,383	193,328,103	204,072,496	651,926,747	1,070,684,224	1,722,610,971
Retail Costs
Corantence	21,196,666	48,210,763	3,274,901	9,967,315	854,916	4,516,985	6,459,839	5,480,295	31,786,321	68,175,358	99,961,680
sprocure and consumer	21,733,880	47,332,637	6.393.670	19,459,439	6,139,057	32,435,977	130.341.514	110.577.050	164,608,120	209.805.102	374,413,223
েলা	42,930,546	95,543,400	9,668,571	29,426,754	6,993,972	36,952,962	136,801,353	116,057,345	196,394,442	277,980,460	474,374,902
eliferecests
organisation	$\overline{0}$	0	914,763	2,784,125	122,494	647,205	1,529,482	1,297,558	2,566,740	4,728,887	7,295,627
aroute and consumer	$\overline{0}$	0	21.927	66.736	3,314	17,509	161.390	136,917	186.631	221.162	407,793
metvont expenses	$\Omega$	0	5,296,294	16,119,521	725,964	3,835,664	7,642,694	6.483.787	13,664,952	26.438.971	40,103,923
स्टब्स	$\overline{0}$	0	6,232,984	18,970,382	851,772	4,500,378	9,333,566	7,918,261	16,418,322	31,389,021	47,807,343
Retail price	139.58	99.42 90.62	0.16	0.12 0.02	0.52	0.41	0.35 0.02	0.43	253	175	198
Access price Unit cost	129.87 16.66	15.66	0.03 0.03	0.03	0.01 0.30	0.01 0.30	0.26	0.02 0.26	139 83	99 51	111 60
monted marin	$-6.95$	$-6.86$	0.10	0.07	0.20	0.10	0.07	0.15	31	26	28
Impulse neitelni Z	$-5%$	$-7%$	63%	57%	39%	23%	20%	36%	12%	15%	14%

Non price terms and conditions key performance indicators (July - September quarter, 2003)

Ordering and Provisioning - Basic Access

	Metric Measure	The difference between percentage of Wholesale Business customers and Retail Business customers in target (that is, that have met the performance standard)	The difference between percentage of Wholesale Residential customers and Retail Residential customers in target (that is, that have met the performance standard)
	The percentage of basic access customer installation orders provisioned in the quarter on or by the performance standard $-$ previous service available for automatic connection	1.05	$-1.90$
$\overline{2}$	The percentage of basic access customer installation orders provisioned in the quarter, on or by the performance standard - new service with available cabling and capacity	$-1.36$	$-3.72$
3	The percentage of Basic Access orders provisioned in the quarter, on or by the performance standard - new service which requires additional cable or network capacity	17.93	$-1.61$
4	The percentage of basic access order appointments that are met in the quarter	0.04	$-0.57$

Faults and Maintenance - Basic Access

	Metric Measure	The difference between percentage of Wholesale Business customers and Retail Business customers in target (that is, that have met the performance standard)	The difference between percentage of Wholesale Residential customers and Retail Residential customers in target (that is, that have met the performance standard)
5.	The percentage of basic access faults that are rectified in the quarter, on or by the performance standard	$-0.89$	$-1.21$
	The percentage of basic access fault appointments that are met in the quarter	2.12	3.63

Notes:

• The performance standard used for all metrics is the same as that used for the $\bullet$ Customer Service Guarantee, unless otherwise stated.
• A positive difference means that Wholesale met the performance standard in a greater percentage of cases than Retail.
• For metrics 1-3, the performance standard = target provisioning time $(TPT)$ $\bullet$
• For metric 5, the performance standard $=$ target date/time. $\bullet$

FACT SHEET: Accounting Separation - Overview

What is accounting separation?

The Government requires Telstra to make information available showing whether Telstra (i) prices competitor access to its network fairly; (ii) sets its retail and wholesale prices at levels sufficient for competitors to generate satisfactory returns and (iii) does not favour its retail customers compared to its wholesale end-users.

The information can be classified into three limbs:

Limb 1 is the requirement for Telstra to update its requlatory accounting records from historic to current costs - being the costs that would be incurred if the network were to be built using today's up to date technology. The ACCC is required to publish these accounts for the core wholesale services (interconnect, unbundled local loop and local call resale). This limb is a work in progress, with Telstra working closely with the ACCC to implement the requirement to produce full current cost accounts. This is a significant and complex exercise to undertake. Until it is fully implemented, no substantive conclusions can be drawn. The initial Limb 1 data provides a critical milestone in this process - the fixed asset statements for the core services on both an historic and current cost basis;

Limb 2 requires that Telstra provide data to the ACCC to show the margins available between Telstra's average retail prices for access/local, STD, IDD and fixed to mobile services and the costs that a competitor would incur in supplying these services if it were relying solely on Telstra's wholesale products for network inputs. The average available margin across the full set of these retail services (the margin of relevance to full service carriers) will also be published. The data proves that our competitors, who purchase from Telstra at wholesale prices and resell their range of services in retail markets, are able to make satisfactory returns of 14% across the suite of the most popular telephony services. Margins across these most popular services vary. It is no different to other industries in which multiple products/services are offered. For example, petrol stations would offer petrol at a lower margin than other products they offer for sale; and

Limb 3 requires Telstra to publish a series of measurements that compare its performance in terms of new service connections and fault rectification for both wholesale and retail customers. The data shows there is no pattern of favouring retail customers over wholesale customers. Telstra is essentially treating wholesale and retail customers equally.

What does the accounting separation data show?

The Accounting Separation data counters claims by Telstra's competitors that Telstra has been discriminating against them. The data shows that service providers who purchase from Telstra at wholesale prices and resell in retail markets are able to make satisfactory returns. It demonstrates that there is no pattern of favouring retail customers over wholesale in relation to service provision. Telstra believes this data shows it gives competitors a fair go.

FACT SHEET: Accounting Separation - Limb 1

What does limb 1 require?

'Limb 1' of the accounting separation regime requires Telstra to update its requlatory accounting records from historic to current costs - being the costs that would be incurred if the network were to be built today. The ACCC is required to publish these accounts for the core wholesale services (interconnect, unbundled local loop and local call resale). Given the difficulties associated with implementing this requirement the initial Limb 1 reports provide only the fixed asset statements for the core services on both an historic and a current cost basis.

Background to limb 1

One of the key concerns of Telstra's competitors relates to the pricing of the main wholesale services. Limb 1 is designed to reveal, over time, costs and revenues that Telstra generates from those products.

It takes time to generate current cost estimates - it took BT around 5 years to do so in the UK. Telstra envisages having such estimates available well before five years, but the exact timing remains uncertain and will be determined by the ACCC in consultation with Telstra.

For these reports, the ACCC have required Telstra to publish the fixed asset allocations - an essential first step in estimating current costs.

What does the limb 1 data show?

In terms of the data provided to date - the fixed asset statements - it is clear the value of the assets inflates marginally when transiting from an historic to a current cost basis. The impact this will have on the full accounts remains unclear.

This limb is a work in progress, with Telstra working with the ACCC to implement the further requirements imposed on it in relation to producing full current cost accounts. This is a significant and complex exercise to undertake, in addition to the accounts which Telstra already prepares. Until it is fully implemented, no substantive conclusions can be drawn.

FACT SHEET: Accounting Separation - Limb 2

What does limb 2 require?

'Limb 2' requires that Telstra provide data to the ACCC to show the margins available between Telstra's average retail prices for access/local, STD, IDD and fixed to mobile services and the costs that a competitor would incur in supplying these services if it were relying solely on Telstra's wholesale products for network inputs. The average available margin across the full set of these retail services (the margin of relevance to full service carriers) will also be published.

Background to limb 2

The industry has expressed concerns as to whether there is sufficient space between Telstra's wholesale and retail prices to allow competitors to compete. In response, Telstra has been required to publish average margins available for monthly PSTN line rental, local call, long distance, international and fixed to mobile for both business & residential markets calculated according to the following formula:

Average retail price Less retailing costs Less average wholesale charges .
In delivative de de la detecta de la també de de de de la de de de de de de la també de la també de la també Equals the average margin available --------------------------------------

What does the limb 2 data show?

This data shows the indicative margins available to telecommunications industry players on a range of the most popular telephony services. The data proves that our competitors, who purchase from Telstra at wholesale prices and resell their range of services in retail markets, are able to make satisfactory returns of 14% (overall) across the suite of the most popular telephony services.

	Business	Residential
Access/Local	-5%	-7%
STD	64%	58%
IDD	40%	24%
F2M	21%	36%
ALL Services	12%	15%

Margins across these most popular services vary. It is no different to other industries in which multiple products/services are offered. For example, petrol stations would offer petrol at a lower margin than other products they offer for sale. In the telecommunications industry, this effect is compounded by regulation putting a cap on some prices eg. access and local calls.

FACT SHEET: Accounting Separation - Limb 3

What does limb 3 require?

'Limb 3' requires that Telstra publish a series of measures that compare Telstra's performance in terms of new service connections and fault rectification for both wholesale and retail customers.

Background to limb 3

The industry has expressed concerns as to whether Telstra treats wholesale and retail customers equivalently in terms of installing new services or fixing faults.

Telstra is required to publish data (for both business and residential customers) that compares Telstra's performance in meeting the mandated customer service quarantee standard timeframes for wholesale vs retail customers. Performance is compared on six measures, outlined below.

What does the data show?

Telstra is essentially treating wholesale and retail customers equally. The data shows there is no pattern of favouring retail customers over wholesale customers. Telstra has thoroughly investigated any variances and has concluded that they are due to data measurement and processing differences in Retail and Wholesale, not differences in the way our technicians service wholesale or retail customers. We are confident that these recording and processing differences will be eradicated in the next quarter or two and this will address the variances.

A positive difference means that Wholesale met the performance standard in a greater percentage of cases than Retail. Explanations for those measures with variances greater than two per cent are set below:

Measure 2 relates to installation where necessary cabling and capacity is available and the data shows slight variation between wholesale and retail performance. This is because retail customers tend to submit a series of small orders throughout the day, whereas our wholesale customers tend to consolidate their orders and submit large batches at once, usually towards the close of business (which may have been too late to meet calendar close at 5pm). To address this, Telstra is working closely with wholesale customers to educate them in the benefits of avoiding bulk on line order lodgement towards the end of the day. Telstra has also introduced an

Note the CSG reported performance cannot be compared to the reporting under NPTC due to the customer base being broader for NPTC (includes all customers), when compared to CSG (applies to 5 lines and under only)

additional late shift workforce to cater for orders received late in the day and has extended the sustem's calendar to facilitate this.

Measure 3 (ordering and provisioning where new service needs additional cable or network capacity) shows wholesale (business) met the performance standard in a greater percentage of cases than retail due to a difference in the way data for business customers is measured. The main cause is that sometimes business customers who have reauested this service from Telstra want to change the time of their appointment - for example, when their plans change unexpectedly. When they call to change the appointment, the new appointment time will be recorded in Telstra's system. This is the same for retail and wholesale customers.

The measurement difference occurs because while Retail registers this new appointment it uses the date of the original appointment to measure the time between when the customer order was received and when the service was delivered, so the time taken appears much longer than it really is. In wholesale, the measurement is made between the revised appointment time and when the service was delivered. In both cases, the service is delivered as the customer has requested it; this is purely a difference in measurement. The measurement processes in Wholesale and Retail have now been aligned.

A further 3 percentage points of the variance arises due to order entry delays caused by system and workforce management issues, which have been addressed.

Measure 6 covers the percentage of basic access fault appointments met in the quarter. Telstra complies with a customer service quarantee standard which recommends a maximum 5 hr window to schedule a basic access fault appointment, and those made outside 5 hrs have been measured as "invalid". The data shows that wholesale met the performance standard in a greater percentage of cases for both business and residential customers, due to some appointments (such as Priority Assistance and complex managed faults - a larger share of these cases in Retail) being made outside the standard 5 hr timeframe.

Whilst customer appointments outside 5 hrs are still being met, but just measured as "invalid", we have changed the field workforce process so appointments are now registered only within the 5 hr timeframe.