Incredimail 2013 Annual Report Download - page 110

PERION NETWORK LTD. AND ITS SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
U.S. dollars in thousands (except share and per share data)
The Company's liability for severance pay is calculated pursuant to Israel's Severance Pay Law based on its employees'
most recent monthly salaries, multiplied by the number of years of their employment, or a portion thereof, as of the
balance sheet date.
This liability is fully provided for by monthly deposits in insurance policies and by an accrual.
The deposited funds include profits (losses) accumulated up to the balance sheet date. The deposited funds may be
withdrawn only upon the fulfillment of the obligation pursuant to Israel's Severance Pay Law or labor agreements.
The Company's agreements with employees in Israel, joining the Company since February 2, 2008, are in accordance with
section 14 of the Severance Pay Law, 1963, where the Company's contributions for severance pay shall be instead of its
severance liability. Upon contribution of the full amount of the employee's monthly salary, and release of the policy to the
employee, no additional calculations shall be conducted between the parties regarding the matter of severance pay and no
additional payments shall be made by the Company to the employee. Further, the related obligation and amounts
deposited on behalf of such obligation are not stated on the balance sheet, as the Company is legally released from
obligation to employees once the deposit amounts have been paid.
Severance expenses for the years ended December 31, 2011, 2012 and 2013 amounted to $ 586, $ 589 and $ 992,
respectively.
Basic net earnings per ordinary shares are computed based on the weighted average number of ordinary shares outstanding
during each year. Diluted net earnings per ordinary share are computed based on the weighted average number of ordinary
shares outstanding during each year, plus dilutive potential ordinary shares considered outstanding during the year, in
accordance with ASC 260, "Earnings Per Share".
The weighted average number of ordinary shares related to the outstanding options and restricted shares
excluded from
the calculations of diluted net earnings per ordinary share, as these securities are anti-
dilutive, was 1,266,919, 1,315,106
and 522,281 for the years ended December 31, 2011, 2012 and 2013, respectively.
NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.)
o.
Severance pay:
p.
Net earnings per ordinary share:
F
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