PARTNER COMMUNICATIONS CO LTD | CIK:0001096691 | 3

  • Filed: 3/29/2018
  • Entity registrant name: PARTNER COMMUNICATIONS CO LTD (CIK: 0001096691)
  • Generator: GoXBRL
  • SEC filing page: http://www.sec.gov/Archives/edgar/data/1096691/000117891318001012/0001178913-18-001012-index.htm
  • XBRL Instance: http://www.sec.gov/Archives/edgar/data/1096691/000117891318001012/ptnr-20171231.xml
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  • ifrs-full:DescriptionOfAccountingPolicyForIntangibleAssetsOtherThanGoodwillExplanatory

    f.
    Licenses and other intangible assets

    (1)
    Licenses costs and amortization (see also note 1 (d)):

    (a)
    The licenses to operate cellular communication services were recognized at cost. Borrowing costs which served to finance the license fee - incurred until the commencement of utilization of the license - were capitalized to cost of the license.

    (b)
    Partner Land-line Communication solutions – limited partnership's license for providing fixed-line communication services is stated at cost.

    (c)
    012 Smile and its subsidiaries' licenses were recognized at fair value in a business combination as of the acquisition date of 012 Smile March 3, 2011.

    The other licenses of the Group were received with no significant costs.

    The licenses are amortized by the straight-line method over their useful lives (see note 1(d)) excluding any ungranted possible future extensions that are not under the Group's control. The amortization expenses are included in the cost of revenues.

    (2)
    Computer software:

    Acquired computer software licenses are capitalized on the basis of the costs incurred to acquire and to bring to use the specified software.

    Development costs, including employee costs, that are directly attributable to the design and testing of identifiable and unique software products controlled by the Group are recognized as intangible assets when the capitalization criteria under IAS 38 are met. Other development expenditures that do not meet the capitalization criteria, such as software maintenance, are recognized as an expenses as incurred.

    Computer software costs are amortized over their estimated useful lives (3 to 10 years) using the straight-line method, see also note 11.

    (3)
    Customer relationships:

    The Company has recognized as intangible assets customer relationships that were acquired in a business combination and recognized at fair value as of the acquisition date. Customer relationships are amortized to selling and marketing expenses over their estimated useful economic lives (5 to 10 years) based on the straight line method. See note 13(2) with respect of impairment charges in 2015.

    (4)
    012 Smile trade name:

    Trade name was acquired in a business combination. In 2015, the Group decided to cease the usage of the "012 Smile" trade name in 2017.As a result the Group revised its expected useful life to end in 2017 as a change in accounting estimate. As a result the amortization expenses of the 012 Smile trade name increased by NIS 1 million, NIS 16 million, and NIS 6 million in 2015, 2016, 2017 respectively, see also notes 4(a)(2), and 13(2). As of December 31, 2017 the trade name was fully amortized.

    (5)
    Capitalization of contract costs according to IFRS15 (see note 2(n)):

    According to IFRS 15 (see note 2(n)) incremental costs of obtaining contracts with customers are recognized as assets when the costs are incremental to obtaining the contracts, and it is probable that the Group will recover these costs, instead of recognizing these costs in the statement of income as incurred (mainly direct commissions paid to resellers and sales employees for sales and upgrades). The assets are amortized in accordance with the expected service period (mainly over 2-3 years), using the portfolio approach, see also note 4(a)(1). IFRS 15 also determines that direct costs of fulfilling a contract which the Group can specifically identify and which produce or improve the Group’s resources that are used for its future performance obligation (and it is probable that the Group will recover these costs) are recognized as assets (together: "contract costs"), see note 11. Contract costs that were recognized as assets are presented in the statements of cash flows as part of cash flows used in investing activities. Other costs incurred that would arise regardless of whether a contract with a customer was obtained are recognized as an expense when incurred.