When the spotter uses binoculars, the icon appears and stays a bit. Also, anyone in a vehicle or stationary defense (AT Gun/emplaced MG/Mortar/etc) will also put the icon on the map. If the person who spots is a Squad Leader or the Commander, you see the "Enemy ____ Spotted" text and hear them no matter where you are. If the person who spotted is just a normal soldier, you might be able to hear them if they happen to be within earshot, otherwise, you won't hear them.
Note that if a normal soldier with binoculars spots something, you usually won't hear them, but the icon should appear on the map. Likewise, if an SL or Commander spots something without binoculars, you will hear them and see the text, but no icon will appear on the map.
Finally, I believe there is a finite distance that the icon will appear on the map for people. For example, if you are in the German Main on El Alamein and someone spots tanks leaving the British Main, you might not see it. I think the max distance people will see the icon is about 2 grids away on the largest maps. I'm not entirely sure about this, but from my observations (and reactions from other players) in game, it seems to be correct.
