Annual Report 2012 - Dialog

70 l Dialog Axiata PLC l Annual Report 2012
Notes to the Financial Statements
2 Summary of significant accounting policies contd.
2.13 Trade and other payables contd.
(e) Share-based compensation contd.
Non-market vesting conditions are included in the assumptions about the number of options that are expected to vest.
At the date of statement of financial position, the Company and the Group revise its estimates of the number of share
options that are expected to vest. It recognises the impact of the revision of original estimates, if any, in the statement of
comprehensive income, with a corresponding adjustment to equity.
The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and
share premium when the options are exercised.
2.17 Deferred revenue
Deferred revenue comprises of, the unutilised balance of call time, telecast time and downloadable quota in respect of
prepaid cards and services sold to customers. Such revenue amounts are recognised as revenue upon subsequant
utilisation of call time, telecast time and downloadable quota by the customer or when the credit expires.
2.18 Subscriber acquisition costs
Subscriber acquisition costs comprise handset and other subsidies offered under usage contracts in excess of one (1)
year. Subscriber acquisition costs are amortised over the contract period and reviewed annually for impairment. Other
subscriber acquisition costs under usage contracts less than one (1) year are recognised as an expense in the statement of
comprehensive income as incurred.
2.19 Provisions
Provisions are recognised when the Company and the Group have a present legal or constructive obligation as a result of
past events when it is more probable that an outflow of resources will be required to settle the obligation and when a reliable
estimate of the amount can be made. Provisions are not recognised for future operating losses.
Where there are number of similar obligations, the likelihood that an outflow will be required in settlement is determined by
considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to
any one item included in the same class of obligations may be small.
Provisions for asset retirement obligations are measured at the present value of the expenditures expected to be required to
settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks
specific to the obligation. The increase in the provision due to passage of time is recognised as finance cost.
2.20 Contingent liabilities and contingent assets
The Company and the Group do not recognise a contingent liability but disclose its existence in the financial statements. A
contingent liability is a possible obligation that arises from past events whose existence will be confirmed by uncertain future
events beyond the control of the Company and the Group or a present obligation that is not recognised because it is not
probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in the extremely
rare circumstance where there is a liability that cannot be recognised because it cannot be measured reliably.
A contingent asset is a possible asset that arises from past events whose existence will be confirmed by uncertain future
events beyond the control of the Company and the Group. The Company and the Group do not recognise a contingent
asset but discloses its existence where inflows of economic benefits are probable, but not virtually certain.
In the acquisition of subsidiaries by the Group under a business combination, the contingent liabilities assumed are
measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest.