r) Revenue
Identification of the contract
The
Group
applies
contract-by-contract
approach,
meaning
that
transaction
price
and
separate
performance
obligations
and
rights
arising
under
the
contract
are
determined
at
the
level of distinct contract with subscriber. Group does not apply portfolio approach.
Determination of the transaction price
The
estimation
regarding
transaction
price
is
updated
during
contract
period.
When
variable
consideration
is
present
in
a
contract,
Group
always
recognizes
the
minimum
value
of
consideration
at
the
moment
of
concluding
the
contract.
As
far
as
the
contract
length
is
concerned, the nominal basic period resulting from the contract terms is assumed.
In
case
of
prepaid
services,
the
value
of
the
balance
unused
by
the
customer
is
recognized
as revenue when the grace period of the account expires.
The
time
value
of
money
is
included
in
the
transaction
price
if
the
contract
contains
a
material
financing
factor.
This
factor
is
considered
at
the
contract
level.
Group
recognizes
a
significant
financing
factor
only
within
installment
sales.
Identification
of
the
discount
causes
a
reduction
in
nominal
sales
revenues
by
the
financing
factor
value
and
recognition
of
interest
during
the
term
of
the
contract.
To
calculate
the
significant
financing
factor,
Group
uses
a
discount
rate
that reflects the customer's credit risk at the moment of concluding the contract.
Group adopted the following hierarchy of methods for determining the fair price (unit price) of
equipment
(the
preferred
method
is
the
method
of
prices
obtained
from
the
sale
of
similar
goods):
(a)
Price obtained from the sale of similar goods,
(b)
Price based on accounting cost.
Group
adopted
the
following
hierarchy
of
methods
for
determining
the
unit
price
of
a
service:
(a)
Price obtained from the sale of similar goods,
(b)
Residual approach (in the B2B area).
Revenue recognition
Revenues are recognized in the value of transaction price for the sale of services and equipment net of any discounts, refunds and rebates in the ordinary course of business. Revenues are recognized only when there is a high probability that the subscriber makes payment, the associated expenses can be reliably assessed and the revenue amount can be reliably measured. If it is probable that rebates are granted and their value can be precisely measured, then such rebates decrease sales revenue when it is recognized.
In
order
to
properly
recognize
revenue,
Group
assesses
at
the
contract
inception
whether
each separate performance obligation is satisfied over time or at a point in time.
The Group’s main sources of revenue are recognized as follows:
•
Retail
revenues
from
residential
and
business
customers
include
revenues
resulting
from
the
provision
of
telecommunications
and
television
services
and
equipment
rental
services
to
post-paid
customers,
recognized
over
the
nominal
term
of
the
contract.
Retail
revenues
from
residential
and
business
customers
also
include
revenues
from
the
unused
balance
of
prepaid
customers
whose
grace
period
has
expired,
recognized
in
a
given
point
in
time.
Activation
and
installation
fees
do
not
represent
a
separate
service obligation, so there is no revenue recognition for these categories.
•
Wholesale
revenue
comprises
advertising
and
sponsorship
revenue,
revenue
from
cable
and
satellite
operator
fees,
revenue
from
the
lease
of
infrastructure,
interconnect
