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Products and Services Revenues (Tables)
 3 Months Ended
Mar. 31, 2018
Revenue from Contract with Customer [Abstract]  
Schedule of operating revenues by products and services
Our operating revenues for our products and services consisted of the following categories:
 
Three Months Ended March 31,
 
2018
 
2017
 
(Dollars in millions)
IP & Data Services
$
146

 
151

Transport & Infrastructure
759

 
769

Voice & Collaboration
460

 
511

IT & Managed Services
2

 
1

Regulatory
52

 
54

Affiliates services
711

 
676

Total operating revenues
$
2,130

 
2,162
Schedule of new accounting pronouncements and changes in accounting principles
The following table presents our reported results under ASC 606 and a reconciliation to results using the historical accounting method:
 
Three Months Ended March 31, 2018
 
(Dollars in millions, except per share amounts
and shares in thousands)
 
Reported Balances as of March 31, 2018
 
Impact of 606
 
ASC 605
Historical Adjusted Balances
Operating revenues
$
2,130

 
(9
)
 
$
2,121

Cost of services and products (exclusive of depreciation and amortization)
707

 
6

 
713

Selling, general and administrative
215

 
(1
)
 
214

Income tax expense
130

 
(4
)
 
126

Net income
$
380

 
(10
)
 
$
370

The following table presents a reconciliation of certain consolidated balance sheet captions under ASC 606 to the balance sheet results using the historical accounting method:
 
As of March 31, 2018
 
(Dollars in millions)
 
Reported Balances as of March 31, 2018
 
Impact of 606
 
ASC 605
Historical Adjusted Balances
Other current assets
$
217

 
(109
)
 
$
108

Other long-term assets, net
100

 
(31
)
 
69

Advance billing and customer deposits
255

 
1

 
256

Deferred income taxes, net
1,003

 
(41
)
 
962

Other long-term liabilities
80

 
27

 
107

Accumulated deficit
(505
)
 
(138
)
 
(643
)
Disaggregation of revenue
Pursuant to ASU 2014-19 discussed in Note 1 above, the following table provides disaggregation of revenue from contracts with customers as of March 31, 2018:
 
Three Months Ended March 31, 2018
 
(Dollars in millions)
 
Total Revenue
 
Adjustments for Non-ASC 606 Revenue (7)
 
Total Revenue from Contracts with Customers
IP & Data Services (1)
$
146

 
—

 
146

Transport & Infrastructure (2)
759

 
(26
)
 
733

Voice & Collaboration (3)
460

 
—

 
460

IT & Managed Services (4)
2

 
—

 
2

Regulatory revenues (5)
52

 
(52
)
 
—

Affiliate revenues (6)
711

 
—

 
711

Total revenues
$
2,130

 
(78
)
 
2,052

 
 
 
 
 
 
Timing of Revenue
 
 
 
 
 
Goods transferred at a point in time
 
 
 
 
$
11

Services performed over time
 
 
 
 
2,041

Total revenues from contracts with customers
 
 
 
 
$
2,052

(1
)
Includes primarily VPN data network, Ethernet, IP and ancillary revenues.
(2
)
Includes primarily broadband, private line (including business data services) and ancillary revenues.
(3
)
Includes local voice and other ancillary revenues.
(4
)
Includes IT services and managed services revenues.
(5
)
Includes CAF Phase I, CAF Phase 2 and federal and state USF support revenue.
(6
)
Includes telecommunications and data services we bill to our affiliates.
(7
)
Includes regulatory revenues, lease revenues and sublease rental income, which are not within the scope of ASC 606.
Contract with customer, asset and liability
The following table provides balances of customer receivables, contract assets and liabilities as of March 31, 2018 and January 1, 2018:
 
March 31, 2018
January 1, 2018
 
(Dollars in millions)
Customer receivables (1)
$
561

631

Contract liabilities
79

78

Contract assets
$
113

93

(1) Gross customer receivables of $602 million and $669 million, net of allowance for doubtful accounts of $41 million and $38 million, at March 31, 2018 and January 1, 2018, respectively.