System and method for detecting and reporting an error in communications with customer premise equipment. A preferred embodiment comprises monitoring the communications link between an access device and customer premise equipment located on customer premises. If a communications link fails, or some other condition occurs, an error signal is transmitted to the access network to notify downstream network elements of the error condition. In one embodiment, an access device is communicatively coupled to a demarcation device via an Ethernet link. If a loss of link occurs on the Ethernet link, an error signal, such as an alarm indicator signal, is transmitted through the network.