A company ( commutation company ) has large investment in capital assets , and a high debt load . It has a history of operating losses , but positive cash flows from operations after material depreciation or amortization charges are added back . Cash flow from investing activities , representing the purchase of capital assets , are negative . 1 .` Accounting policies Customer lists represent equipment subsidies granted to customers . These amounts are deferred and amortized straight- line over a 24 - month period . And represent the cost of equipment provided to subscription cable customers . Customer lists In thousand 2018 2017 Cost Accumulated Cost Accumulated Amortization Amortization Customer Lists |$418742 $ 270908 $291600 $1 17277 No disposal or written - off Cash flow 2018 2017 Operating activities Total $335400 $289100 Investing activities Total (5 825100 1 (5 1 107200 ) Customer base is critical for company and once the customer is established , there is very low turnover and revenue from customer is secured . Management think that 24 - month amortization is very conservative , since the average customer stays for at least 10 years Question : Evaluate accounting policy for customer list Impact of this policy on the statement of cash flow