12.

Intangible assets

Turkcell - 2G License

On 27 April 1998, the Company was granted a 25-year GSM license (the “2G License”) for a consideration of USD 500,000, the carrying amount of the 2G license is TL 195,425 at 31 December 2018 (31 December 2017: TL 241,407) and it is amortized over 25 years.

Turkcell - 3G License

On 30 April 2009, the Company signed a license agreement (the “3G License”) with the ICTA which provides authorization for providing IMT 2000/UMTS services and infrastructure. The Company acquired the A-typelicense providing the widest frequency band for a consideration of EUR 358,000 (excluding VAT). The license is effective for 20 years starting from 30 April 2009. The carrying amount of the 3G License is TL 397,543 at 31 December 2018 (31 December 2017: TL 436,014) and it is amortized over 25 years.

Turkcell - 4.5G License

On 26 August 2015, “Authorization Tender on IMT Services and Infrastructure” publicly known as 4.5G license tender, was held by the Information Technologies and Communication Authority and the Company was granted a total frequency band of 172.4M Hz for 13 years for a consideration of EUR 1,623,460 (excluding VAT).

IMT authorization period expires on 30 April 2029 and operators commenced service delivery for 4.5G from 1 April 2016. 2x1.4 MHz frequency band in 900MHz spectrum and 2 units of 2x5 MHz frequency band in 2100 MHz spectrum were commenced on 1 December 2015, while remaining packages were commenced on 1 April 2016.

The carrying amount of the 4.5G License is TL 4,125,743 at 31 December 2018 (31 December 2017: TL 4,528,254).


	Balance at 1 January 2018		Impact of IFRS 15 adaption		Additions		Disposals			Transfers			Impairment			Disposal of subsidiary			Effects of movements in exchange rates		Balance at 31 December 2018
Cost
Telecommunication licenses		8,139,628		—		6,394		(220,986	)		466,379			—			—			331,583		8,722,998
Computer software		7,117,116		—		1,175,040		(4,822	)		159,453			—			(18,370	)		110,621		8,539,038
Transmission line software		71,820		—		1,319		—			—			—			—			—		73,139
Central betting system operating right		11,981		—		—		—			—			—			—			—		11,981
Indefeasible right of usage		112,556		—		5,062		—			—			—			—			—		117,618
Brand name		7,040		—		—		—			—			—			—			—		7,040
Customer base		15,512		—		—		—			—			—			—			—		15,512
Goodwill		32,834		—		—		—			—			—			—			—		32,834
Subscriber acquisition cost		—		1,431,901		583,809		—			—			—			—			18,343		2,034,053
Other		42,749		—		7,473		(37	)		11			—			(191	)		—		50,005
Construction in progress		127,637		—		485,815		—			(618,032	)		—			—			22,587		18,007

Total		15,678,873		1,431,901		2,264,912		(225,845	)		7,811			—			(18,561	)		483,134		19,622,225

Accumulated amortization
Telecommunication licenses		2,419,230		—		533,311		(184,582	)		—			—			—			180,276		2,948,235
Computer software		4,770,880		—		663,967		(3,071	)		—			3,232			(12,793	)		59,680		5,481,895
Transmission line software		62,468		—		4,549		—			—			—			—			—		67,017
Central betting system operating right		11,491		—		583		—			—			—			—			—		12,074
Indefeasible right of usage		23,274		—		8,581		—			—			—			—			—		31,855
Brand name		6,512		—		528		—			—			—			—			—		7,040
Customer base		11,774		—		437		—			—			—			—			—		12,211
Subscriber acquisition cost		—		601,890		360,232		—			—			—			—			12,078		974,200
Other		32,834		—		4,899		(31	)		—			—			(176	)		—		37,526

Total		7,338,463		601,890		1,577,087		(187,684	)		—			3,232			(12,969	)		252,034		9,572,053

Net book amount		8,340,410		830,011		687,825		(38,161	)		7,811			(3,232	)		(5,592	)		231,100		10,050,172

Amortization expenses for the years ended 31 December 2018, 2017 and 2016 amounting to TL 1,580,319, TL 1,095,401and TL 921,812, respectively include impairment losses and are recognized in cost of revenue.

Impairment losses on intangible assets for the years ended 31 December 2018, 2017 and 2016 are TL 3,232, TL 1,986 and TL 3,181 respectively and are recognized in amortization expenses.

Computer software includes capitalized software development costs that meet the definition of an intangible asset. The amount of capitalized development costs is TL 171,442 for the year ended 31 December 2018 (31 December 2017: TL 124,504). The amortization expenses related to capitalized software development costs for the years ended 31 December 2018, 2017 and 2016 amounting to TL 40,934, TL 37,532 and TL 30,148, respectively are recognized in cost of revenue.


	Balance at 1 January 2017		Additions		Disposals			Transfers			Impairment			Effects of movements in exchange rates		Balance at 31 December 2017
Cost
Telecommunication licenses		8,039,431		10,154		—			69,945			—			20,098		8,139,628
Computer software		6,076,405		470,457		(8,624	)		569,153			—			9,725		7,117,116
Transmission line software		71,602		218		—			—			—			—		71,820
Central betting system operating right		11,981		—		—			—			—			—		11,981
Indefeasible right of usage		46,017		66,539		—			—			—			—		112,556
Brand name		7,040		—		—			—			—			—		7,040
Customer base		15,512		—		—			—			—			—		15,512
Goodwill		32,834		—		—			—			—			—		32,834
Other		38,321		5,016		—			(588	)		—			—		42,749
Construction in progress		142,875		620,463		—			(638,357	)		—			2,656		127,637

Total		14,482,018		1,172,847		(8,624	)		153			—			32,479		15,678,873

Accumulated amortization
Telecommunication licenses		1,878,895		537,162		—			—			—			3,173		2,419,230
Computer software		4,237,996		537,805		(8,120	)		—			1,219			1,980		4,770,880
Transmission line software		58,203		3,498		—			—			767			—		62,468
Central betting system operating right		10,588		903		—			—			—			—		11,491
Indefeasible right of usage		18,785		4,489		—			—			—			—		23,274
Brand name		5,808		704		—			—			—			—		6,512
Customer base		11,286		488		—			—			—			—		11,774
Other		24,468		8,366		—			—			—			—		32,834

Total		6,246,029		1,093,415		(8,120	)		—			1,986			5,153		7,338,463

Net book amount		8,235,989		79,432		(504	)		153			(1,986	)		27,326		8,340,410