Juno 2014 Annual Report Download - page 38

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Table of Contents
comparison of our internally-tracked performance data to the contractual performance obligation and, when available, to third-party or customer-provided
performance data.
Advertising and other revenues for our loyalty marketing service consist primarily of fees generated when emails are transmitted to members, when
members respond to emails and when members complete online transactions. Each of these activities is a discrete, independent activity, which generally is
specified in the agreement with each advertising customer. As the earning activities take place, activity measurement data (examples include the number of
emails delivered and the number of responses received) is accumulated and the related revenues are recorded. Our loyalty marketing service also generates
revenues from the sale of gift cards.
Our Communications products revenues are generated from the sale of mobile broadband service devices and mobile phones, including the related
activation fees and shipping and handling fees, and are recognized upon delivery of such devices as this is considered a separate earnings process from the
sale of Communications services. Sales of mobile broadband service devices bundled with free service plans and paid service plans, and activation fees, are
allocated using the relative selling price method in accordance with the multiple-element arrangement provisions of ASC 605. The selling prices of our
mobile broadband paid service plans are determined by vendor specific objective evidence, which is based upon the monthly stand-alone selling price of
each plan. The selling prices of the mobile broadband service devices and free service plans are determined by management's best estimate of selling price,
which considers market and economic conditions, internal costs, pricing, and discounting practices. The revenues allocated to the free service plans are
recognized ratably over the service period. Activation fees received upfront in excess of the amount allocated to mobile broadband devices are deferred and
recognized as services revenues over the estimated service period.
Our social networking products revenues are derived from the sale of yearbooks and yearbook reprints, including the related shipping and handling fees.
Products revenues from the sale of yearbooks and yearbook reprints are recognized upon delivery to the customer. Shipping and handling fees charged to
customers are recognized at the time the related products revenues are recognized and are included in products revenues. Shipping costs are included in cost
of revenues.
Probability of collection is assessed based on a number of factors, including past transaction history with the customer and the creditworthiness of the
customer. If it is determined that collectibility is not reasonably assured, revenue is not recognized until collectibility becomes reasonably assured, which is
generally upon receipt of cash.

Goodwill represents the excess of the purchase price of an acquired entity over the fair value of the net tangible and intangible assets acquired.
Indefinite-lived intangible assets acquired in a business combination are initially recorded at management's estimate of their fair values. We account for
goodwill in accordance with ASC 350, , which among other things, addresses financial accounting and reporting
requirements for acquired goodwill. ASC 350 prohibits the amortization of goodwill and requires us to test goodwill at the reporting unit level for
impairment at least annually.
We test the goodwill of our reporting units for impairment annually during the fourth quarter of our fiscal year and whenever events occur or
circumstances change that would more likely than not indicate that the goodwill might be impaired. Events or circumstances which could trigger an
impairment review include, but are not limited to, a significant adverse change in legal factors or in the business climate, an adverse action or assessment by a
regulator, unanticipated competition, a loss of key management or other personnel, significant changes in the manner of our use of the acquired assets or the
strategy for the acquired business or our overall business, significant and sustained decline
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