[Code of Federal Regulations]
[Title 7, Volume 11]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1744.201]

[Page 363-364]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER XVII--RURAL UTILITIES SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 1744--POST-LOAN POLICIES AND PROCEDURES COMMON TO GUARANTEED AND INSURED TELEPHONE LOANS--Table of Contents
 
                     Subpart E--Borrower Investments
 
Sec. 1744.201  Definitions.

    As used in this subpart:
    Administrator means the Administrator of the Rural Utilities Service 
(RUS) and, as provided in Sec. 1744.200(b), the Governor of the Rural 
Telephone Bank (RTB).
    Advance means any funds provided of which repayment is expected.
    Affiliated company means any organization that directly, or 
indirectly through one or more intermediaries, controls or is controlled 
by, or is under common control with, the borrower.
    Borrower means any organization which has an outstanding loan made 
by RUS or RTB, or guaranteed by RUS, or which is seeking such financing.
    Extension of credit means to make loans or advances.
    Guarantee means to undertake collaterally to answer for the payment 
of another's debt or the performance of another's duty, liability, or 
obligation, including, without limitation, the obligations of affiliated 
companies. Some examples of such guarantees would include:
    (1) Guarantees of payment or collection on a note or other debt 
instrument;
    (2) Issuing performance bonds or completion bonds; or
    (3) Cosigning leases or other obligations of third parties.
    Maximum investment ratio means that the aggregate of all qualified 
investments by the borrower including the proposed qualified investment 
shall not be more than one-third of the net worth of the borrower.
    Minimum total assets ratio means the borrower's net worth is at 
least twenty percent of its total assets including the proposed 
qualified investment.
    Net plant means the sum of the balances of the following accounts of 
the borrower:

------------------------------------------------------------------------
                 Account Names                           Number
------------------------------------------------------------------------
(1) Telecommunications plant in service         2001
(2) Property held for future                    2002
 telecommunications use
(3) Telecommunications plant under              2003
 construction-short term
(4) Telecommunications plant under              2004
 construction-long term
(5) Telecommunications plant adjustment         2005
(6) Nonoperating plant                          2006
(7) Goodwill                                    2007
(8) Less accumulated depreciation               3100 through 3300s
(9) Less accumulated amortization               3400 through 3600s
------------------------------------------------------------------------
Note: All references to account numbers are to the Uniform System of
  Accounts (47 CFR part 32).

    Net worth means the sum of the balances of the following accounts of 
the borrower:

[[Page 364]]



------------------------------------------------------------------------
                 Account Names                           Number
------------------------------------------------------------------------
(1) Capital stock                               4510
(2) Additional paid-in capital                  4520
(3) Treasury stock                              4530
(4) Other capital                               4540
(5) Retained earnings                           4550
------------------------------------------------------------------------
Note: For nonprofit organizations, owners' equity is shown in
  subaccounts of 4540 and 4550. All references regarding account numbers
  are to the Uniform System of Accounts (47 CFR part 32).

    Qualified investment is defined in Sec. 1744.202(b).
    RE Act means the Rural Electrification Act of 1936, as amended (7 
U.S.C. 901 et seq.).
    REA means the Rural Electrification Administration formerly an 
agency of the United States Department of Agriculture and predecessor 
agency to RUS with respect to administering certain electric and 
telephone loan programs.
    RTB means the Rural Telephone Bank, an agency and instrumentality of 
the United States within the United States Department of Agriculture.
    Rural development investment is defined in Sec. 1744.202(d).
    RUS means the Rural Utilities Service, an agency of the United 
States Department of Agriculture established pursuant to Section 232 of 
the Federal Crop Insurance Reform and Department of Agriculture 
Reorganization Act of 1994 (Pub. L. 103-354, 108 Stat. 3178), successor 
to REA with respect to administering certain electric and telephone 
programs. See 7 CFR 1700.1.
    RUS mortgage means the instrument creating a lien on or security 
interest in the borrower's assets in connection with a loan made or 
guaranteed under the RE Act.
    Total assets means the sum of the balances of the following accounts 
of the borrower:

------------------------------------------------------------------------
                 Account Names                           Number
------------------------------------------------------------------------
(1) Current assets                              1100s through 1300s
(2) Noncurrent assets                           1400s through 1500s
(3) Total telecommunications plant              2001 through 2007
(4) Less accumulated depreciation               3100 through 3300s
(5) Less accumulated amortization               3400 through 3600s
------------------------------------------------------------------------
Note: All references regarding account numbers are to the Uniform System
  of Accounts (47 CFR part 32).

    Uniform System of Accounts means the Federal Communications 
Commission Uniform System of Accounts for Telecommunications Companies 
(47 CFR part 32) as supplemented by 7 CFR Part 1770, Accounting 
Requirements for RUS Telephone Borrowers.

[58 FR 52642, Oct. 12, 1993, as amended at 59 FR 66440, Dec. 27, 1994]