FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
June 25,
2015
Commission File Number 001-16125
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Advanced Semiconductor Engineering, Inc.
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( Exact name of Registrant as specified in its charter)
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26 Chin Third Road
Nantze Export Processing Zone
Kaoshiung, Taiwan
Republic of China
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(Address of principal executive offices)
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Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
____
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
____
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):
Not applicable
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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ADVANCED SEMICONDUCTOR
ENGINEERING, INC.
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Date:
June 25, 2015
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By:
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/s/ Joseph Tung
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Name:
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Joseph Tung
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Title:
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Chief Financial Officer
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Advanced Semiconductor Engineering, Inc. and Subsidiaries
Consolidated Financial Statements for the
Three Months Ended March 31, 2014 and 2015
and
Independent Auditors’ Review Report
INDEPENDENT AUDITORS’ REVIEW REPORT
The Board of Directors and Shareholders
Advanced Semiconductor Engineering, Inc.
We have reviewed the accompanying consolidated
balance sheets of Advanced Semiconductor Engineering, Inc. and its subsidiaries (collectively the “Group”) as of March
31, 2014 and 2015, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the three
months ended March 31, 2014 and 2015. These consolidated financial statements are the responsibility of the Group’s management.
Our responsibility is to issue a report on these consolidated financial statements based on our reviews.
We conducted our reviews in accordance
with Statement of Auditing Standards No. 36 “Review of Financial Statements” issued by the Auditing Standards Committee
of the Accounting Research and Development Foundation of the Republic of China. A review consists principally of applying analytical
procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially
less in scope than an audit conducted in accordance with auditing standards generally accepted in the Republic of China, the objective
of which is the expression of an opinion regarding the consolidated financial statements taken as a whole. Accordingly, we do not
express such an opinion.
Based on our reviews, we are not aware
of any material modifications that should be made to the consolidated financial statements referred to above for them to be in
conformity with International Accounting Standard 34 “Interim Financial Reporting” endorsed by the Financial Supervisory
Commission of the Republic of China (the “FSC”).
As discussed in Note 3 to the consolidated
financial statements, the Group has applied the 2013 version of the International Financial Reporting Standards (IFRS), International
Accounting Standards (IAS), Interpretations of IFRS, and Interpretations of IAS endorsed by the FSC from January 1, 2015. Therefore,
the Group retrospectively applied the aforementioned standards and interpretations and adjusted the affected items in the consolidated
financial statements of the preceding periods.
Our reviews also comprehended the translation
of New Taiwan dollar amounts into U.S. dollar amounts and such translation has been made in conformity with the basis stated in
Note 4 to the consolidated financial statements. Such U.S. dollar amounts are presented solely for the convenience of the readers.
/s/ Deloitte & Touche
Taipei, Taiwan
The Republic of China
May 8, 2015
Notice to Readers
The accompanying
consolidated financial statements are intended only to present the consolidated financial position, results of operations and cash
flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other
jurisdictions. The standards, procedures and practices to review such consolidated financial statements are those generally accepted
and applied in the Republic of China.
ADVANCED SEMICONDUCTOR ENGINEERING, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Amounts
in Thousands)
| |
January 1, 2014 (Audited after Adjusted) | |
March 31, 2014 (Reviewed after Adjusted) | |
December 31, 2014 (Audited after Adjusted) | |
March 31, 2015 (Reviewed) |
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| NT$ | | |
| NT$ | | |
| NT$ | | |
| NT$ | | |
| US$ | |
ASSETS | |
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CURRENT ASSETS | |
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Cash and cash equivalents (Notes 4 and 6) | |
$ | 45,026,371 | | |
$ | 43,577,488 | | |
$ | 51,694,410 | | |
$ | 49,414,436 | | |
$ | 1,581,768 | |
Financial assets at fair value through profit or loss - current (Notes 4, 5 and 7) | |
| 2,764,269 | | |
| 3,366,614 | | |
| 4,988,843 | | |
| 4,530,291 | | |
| 145,016 | |
Available-for-sale financial assets - current (Notes 4 and 8) | |
| 2,376,970 | | |
| 1,922,038 | | |
| 1,533,265 | | |
| 979,247 | | |
| 31,346 | |
Trade receivables, net (Notes 4 and 10) | |
| 43,235,573 | | |
| 37,856,827 | | |
| 52,920,810 | | |
| 43,009,481 | | |
| 1,376,744 | |
Other receivables (Note 4) | |
| 422,345 | | |
| 616,417 | | |
| 537,122 | | |
| 515,914 | | |
| 16,515 | |
Current tax assets (Note 4) | |
| 150,596 | | |
| 187,271 | | |
| 65,312 | | |
| 95,998 | | |
| 3,073 | |
Inventories (Notes 4, 5 and 11) | |
| 16,281,236 | | |
| 15,495,215 | | |
| 20,163,093 | | |
| 23,450,499 | | |
| 750,656 | |
Inventories related to real estate business (Notes 4, 5, 12, 23 and 32) | |
| 18,589,255 | | |
| 20,773,954 | | |
| 23,986,478 | | |
| 24,154,597 | | |
| 773,194 | |
Other financial assets - current (Notes 4 and 32) | |
| 278,375 | | |
| 300,331 | | |
| 638,592 | | |
| 653,430 | | |
| 20,916 | |
Other current assets | |
| 3,051,492 | | |
| 3,046,023 | | |
| 3,427,265 | | |
| 2,802,354 | | |
| 89,704 | |
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| 132,176,482 | | |
| 127,142,178 | | |
| 159,955,190 | | |
| 149,606,247 | | |
| 4,788,932 | |
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NON-CURRENT ASSETS | |
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Available-for-sale financial assets - non-current (Notes 4 and 8) | |
| 1,140,329 | | |
| 1,133,960 | | |
| 941,105 | | |
| 885,778 | | |
| 28,354 | |
Investments accounted for using the equity method (Notes 4 and 13) | |
| 1,216,201 | | |
| 1,474,698 | | |
| 1,492,441 | | |
| 1,589,231 | | |
| 50,872 | |
Property, plant and equipment (Notes 4, 5, 14, 23, 32 and 33) | |
| 131,497,331 | | |
| 130,422,379 | | |
| 151,587,115 | | |
| 150,055,369 | | |
| 4,803,309 | |
Goodwill (Notes 4, 5 and 15) | |
| 10,347,820 | | |
| 10,382,862 | | |
| 10,445,415 | | |
| 10,426,821 | | |
| 333,765 | |
Other intangible assets (Notes 4, 5, 16 and 23) | |
| 1,605,824 | | |
| 1,563,584 | | |
| 1,467,871 | | |
| 1,487,676 | | |
| 47,621 | |
Deferred tax assets (Notes 4 and 5) | |
| 3,783,265 | | |
| 3,987,269 | | |
| 4,506,972 | | |
| 4,612,250 | | |
| 147,639 | |
Other financial assets - non-current (Notes 4 and 32) | |
| 354,993 | | |
| 342,843 | | |
| 367,345 | | |
| 364,520 | | |
| 11,668 | |
Long-term prepayments for lease (Note 17) | |
| 4,072,281 | | |
| 2,489,578 | | |
| 2,585,964 | | |
| 2,519,823 | | |
| 80,660 | |
Other non-current assets | |
| 637,163 | | |
| 896,884 | | |
| 635,350 | | |
| 941,817 | | |
| 30,148 | |
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| 154,655,207 | | |
| 152,694,057 | | |
| 174,029,578 | | |
| 172,883,285 | | |
| 5,534,036 | |
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TOTAL | |
$ | 286,831,689 | | |
$ | 279,836,235 | | |
$ | 333,984,768 | | |
$ | 322,489,532 | | |
$ | 10,322,968 | |
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(Continued)
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January 1, 2014 (Audited after Adjusted) | |
March 31, 2014 (Reviewed after Adjusted) | |
December 31, 2014 (Audited after Adjusted) | |
March 31, 2015 (Reviewed) |
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| NT$ | | |
| NT$ | | |
| NT$ | | |
| NT$ | | |
| US$ | |
LIABILITIES AND EQUITY | |
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CURRENT LIABILITIES | |
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Short-term borrowings (Note 18) | |
$ | 44,618,195 | | |
$ | 33,853,530 | | |
$ | 41,176,033 | | |
$ | 36,660,840 | | |
$ | 1,173,523 | |
Financial liabilities at fair value through profit or loss - current (Notes 4, 5 and 7) | |
| 1,853,304 | | |
| 2,413,941 | | |
| 2,651,352 | | |
| 3,701,350 | | |
| 118,481 | |
Derivative financial liabilities for hedging - current (Notes 4, 5 and 9) | |
| 3,310 | | |
| 515 | | |
| — | | |
| — | | |
| — | |
Trade payables | |
| 28,988,976 | | |
| 25,471,468 | | |
| 35,411,281 | | |
| 31,705,893 | | |
| 1,014,913 | |
Other payables (Note 20) | |
| 14,758,553 | | |
| 15,840,371 | | |
| 22,364,516 | | |
| 19,935,228 | | |
| 638,132 | |
Current tax liabilities (Note 4) | |
| 3,000,869 | | |
| 3,282,799 | | |
| 4,150,036 | | |
| 4,552,116 | | |
| 145,714 | |
Advance real estate receipts | |
| 19,248 | | |
| 30 | | |
| 480,325 | | |
| 863,767 | | |
| 27,649 | |
Current portion of bonds payable (Notes 4 and 19) | |
| 731,438 | | |
| 741,695 | | |
| — | | |
| — | | |
| — | |
Current portion of long-term borrowings (Notes 18 and 32) | |
| 5,276,206 | | |
| 5,032,977 | | |
| 2,831,007 | | |
| 1,147,234 | | |
| 36,723 | |
Other current liabilities | |
| 1,585,177 | | |
| 1,540,356 | | |
| 2,134,917 | | |
| 2,190,160 | | |
| 70,108 | |
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Total current liabilities | |
| 100,835,276 | | |
| 88,177,682 | | |
| 111,199,467 | | |
| 100,756,588 | | |
| 3,225,243 | |
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NON-CURRENT LIABILITIES | |
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Bonds payable (Notes 4 and 19) | |
| 20,582,567 | | |
| 20,975,751 | | |
| 31,270,131 | | |
| 31,092,655 | | |
| 995,283 | |
Long-term borrowings (Notes 18 and 32) | |
| 29,580,659 | | |
| 29,008,600 | | |
| 24,104,424 | | |
| 24,750,020 | | |
| 792,254 | |
Deferred tax liabilities (Notes 4 and 5) | |
| 2,663,767 | | |
| 2,968,402 | | |
| 3,932,819 | | |
| 4,021,104 | | |
| 128,716 | |
Long-term payables | |
| 894,150 | | |
| 548,460 | | |
| — | | |
| — | | |
| — | |
Net defined benefit liabilities (Notes 3, 4 and 5) | |
| 4,545,960 | | |
| 4,613,314 | | |
| 4,382,530 | | |
| 4,413,761 | | |
| 141,286 | |
Other non-current liabilities | |
| 651,171 | | |
| 617,384 | | |
| 657,392 | | |
| 807,333 | | |
| 25,843 | |
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Total non-current liabilities | |
| 58,918,274 | | |
| 58,731,911 | | |
| 64,347,296 | | |
| 65,084,873 | | |
| 2,083,382 | |
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Total liabilities | |
| 159,753,550 | | |
| 146,909,593 | | |
| 175,546,763 | | |
| 165,841,461 | | |
| 5,308,625 | |
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EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY (Notes 4 and 22) | |
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Share capital | |
| 78,180,258 | | |
| 78,337,123 | | |
| 78,715,179 | | |
| 79,187,950 | | |
| 2,534,826 | |
Capital surplus | |
| 7,920,220 | | |
| 8,243,326 | | |
| 16,013,058 | | |
| 16,094,169 | | |
| 515,178 | |
Retained earnings | |
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Legal reserve | |
| 8,720,971 | | |
| 8,720,971 | | |
| 10,289,878 | | |
| 10,289,878 | | |
| 329,382 | |
Special reserve | |
| 3,663,930 | | |
| 3,663,930 | | |
| 3,353,938 | | |
| 3,353,938 | | |
| 107,360 | |
Unappropriated earnings | |
| 26,521,201 | | |
| 29,970,876 | | |
| 38,737,422 | | |
| 43,206,623 | | |
| 1,383,054 | |
Total retained earnings | |
| 38,906,102 | | |
| 42,355,777 | | |
| 52,381,238 | | |
| 56,850,439 | | |
| 1,819,796 | |
Other equity | |
| (102,616 | ) | |
| 1,636,356 | | |
| 5,068,539 | | |
| 3,489,285 | | |
| 111,693 | |
Treasury shares | |
| (1,959,107 | ) | |
| (1,959,107 | ) | |
| (1,959,107 | ) | |
| (7,292,513 | ) | |
| (233,435 | ) |
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Equity attributable to owners of the Company | |
| 122,944,857 | | |
| 128,613,475 | | |
| 150,218,907 | | |
| 148,329,330 | | |
| 4,748,058 | |
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NON-CONTROLLING INTERESTS (Notes 4 and 22) | |
| 4,133,282 | | |
| 4,313,167 | | |
| 8,219,098 | | |
| 8,318,741 | | |
| 266,285 | |
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Total equity | |
| 127,078,139 | | |
| 132,926,642 | | |
| 158,438,005 | | |
| 156,648,071 | | |
| 5,014,343 | |
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TOTAL | |
$ | 286,831,689 | | |
$ | 279,836,235 | | |
$ | 333,984,768 | | |
$ | 322,489,532 | | |
$ | 10,322,968 | |
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| (Concluded) | |
The accompanying notes are an integral
part of the consolidated financial statements.
(With Deloitte & Touche review report
dated May 8, 2015)
ADVANCED SEMICONDUCTOR ENGINEERING, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME
(Amounts
in Thousands Except Earnings Per Share)
(Reviewed, Not Audited)
| |
For the Three Months Ended March 31 |
| |
2014 (Reviewed after Adjusted) | |
2015 (Reviewed) |
| |
| NT$ | | |
| NT$ | | |
| US$ (Note 4) | |
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OPERATING REVENUES (Note 4) | |
$ | 54,699,586 | | |
$ | 64,662,158 | | |
$ | 2,069,851 | |
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OPERATING COSTS (Notes 11, 21 and 23) | |
| 44,340,340 | | |
| 52,348,743 | | |
| 1,675,696 | |
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GROSS PROFIT | |
| 10,359,246 | | |
| 12,313,415 | | |
| 394,155 | |
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OPERATING EXPENSES (Notes 21 and 23) | |
| | | |
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Selling and marketing expenses | |
| 793,186 | | |
| 879,419 | | |
| 28,150 | |
General and administrative expenses | |
| 2,189,342 | | |
| 2,594,411 | | |
| 83,048 | |
Research and development expenses | |
| 2,292,045 | | |
| 2,547,317 | | |
| 81,540 | |
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Total operating expenses | |
| 5,274,573 | | |
| 6,021,147 | | |
| 192,738 | |
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PROFIT FROM OPERATIONS | |
| 5,084,673 | | |
| 6,292,268 | | |
| 201,417 | |
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NON-OPERATING INCOME AND EXPENSES | |
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Other income (Note 23) | |
| 116,713 | | |
| 178,708 | | |
| 5,720 | |
Other losses (Note 23) | |
| (240,489 | ) | |
| (385,776 | ) | |
| (12,349 | ) |
Finance costs (Note 23) | |
| (598,359 | ) | |
| (582,388 | ) | |
| (18,642 | ) |
Share of the profit or loss of associates (Note 4) | |
| (64,226 | ) | |
| 3,804 | | |
| 122 | |
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Total non-operating income and expenses | |
| (786,361 | ) | |
| (785,652 | ) | |
| (25,149 | ) |
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PROFIT BEFORE INCOME TAX | |
| 4,298,312 | | |
| 5,506,616 | | |
| 176,268 | |
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| | | |
| | | |
| | |
INCOME TAX EXPENSE (Notes 4, 5 and 24) | |
| 730,013 | | |
| 856,180 | | |
| 27,406 | |
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| | | |
| | | |
| | |
NET PROFIT FOR THE PERIOD | |
| 3,568,299 | | |
| 4,650,436 | | |
| 148,862 | |
| |
| | | |
| | | |
| | |
OTHER COMPREHENSIVE INCOME (LOSS) | |
| | | |
| | | |
| | |
Items that may be reclassified subsequently to profit or loss | |
| | | |
| | | |
| | |
Exchange differences on translating foreign operations | |
| 1,589,232 | | |
| (1,715,519 | ) | |
| (54,914 | ) |
Unrealized gain (loss) on available-for-sale financial assets | |
| 58,173 | | |
| (54,710 | ) | |
| (1,751 | ) |
Cash flow hedges | |
| 2,869 | | |
| — | | |
| — | |
(Continued)
ADVANCED SEMICONDUCTOR ENGINEERING, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME
(Amounts
in Thousands Except Earnings Per Share)
(Reviewed, Not Audited)
| |
For the Three Months Ended March 31 |
| |
2014 (Reviewed
after Adjusted) | |
2015 (Reviewed) |
| |
| NT$ | | |
| NT$ | | |
| US$ (Note 4) | |
| |
| | | |
| | | |
| | |
Share of other comprehensive income of associates | |
$ | 138,250 | | |
$ | 92,987 | | |
$ | 2,976 | |
| |
| | | |
| | | |
| | |
Other comprehensive income for the period, net of income tax | |
| 1,788,524 | | |
| (1,677,242 | ) | |
| (53,689 | ) |
| |
| | | |
| | | |
| | |
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD | |
$ | 5,356,823 | | |
$ | 2,973,194 | | |
$ | 95,173 | |
| |
| | | |
| | | |
| | |
NET PROFIT ATTRIBUTABLE TO: | |
| | | |
| | | |
| | |
Owners of the Company | |
$ | 3,449,675 | | |
$ | 4,469,201 | | |
$ | 143,061 | |
Non-controlling interests | |
| 118,624 | | |
| 181,235 | | |
| 5,801 | |
| |
| | | |
| | | |
| | |
| |
$ | 3,568,299 | | |
$ | 4,650,436 | | |
$ | 148,862 | |
| |
| | | |
| | | |
| | |
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO: | |
| | | |
| | | |
| | |
Owners of the Company | |
$ | 5,188,647 | | |
$ | 2,889,947 | | |
$ | 92,508 | |
Non-controlling interests | |
| 168,176 | | |
| 83,247 | | |
| 2,665 | |
| |
| | | |
| | | |
| | |
| |
$ | 5,356,823 | | |
$ | 2,973,194 | | |
$ | 95,173 | |
EARNINGS PER SHARE (Note 25) |
|
|
|
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|
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Basic |
|
$ 0.45 |
|
$ 0.58 |
|
$ 0.02 |
Diluted |
|
$ 0.44 |
|
$ 0.56 |
|
$ 0.02 |
|
|
|
|
|
|
(Concluded) |
The accompanying notes are an integral part
of the consolidated financial statements.
(With Deloitte & Touche review report
dated May 8, 2015)
ADVANCED SEMICONDUCTOR ENGINEERING, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(Amounts
in Thousands)
(Reviewed, Not Audited)
| |
Equity Attributable to Owners of the Company | |
| |
|
| |
| |
| |
| |
| |
| |
| |
| |
Other Equity | |
| |
| |
| |
|
| |
| |
| |
| |
| |
| |
| |
| |
Exchange | |
| |
| |
| |
| |
| |
| |
|
| |
| |
| |
| |
| |
| |
| |
| |
Differences on | |
Unrealized Gain | |
| |
| |
| |
| |
| |
|
| |
Share Capital | |
| |
Retained Earnings | |
Translating | |
on Available- | |
| |
| |
| |
| |
| |
|
| |
Shares | |
| |
| |
| |
| |
Unappropriated | |
| |
Foreign | |
for-sale | |
Cash Flow | |
| |
| |
| |
Non-controlling | |
|
| |
(In Thousands) | |
Amounts | |
Capital Surplus | |
Legal Reserve | |
Special Reserve | |
Earnings | |
Total | |
Operations | |
Financial Assets | |
Hedges | |
Total | |
Treasury Shares | |
Total | |
Interests | |
Total Equity |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
|
BALANCE AT JANUARY 1, 2014 | |
| 7,787,827 | | |
$ | 78,180,258 | | |
$ | 7,908,870 | | |
$ | 8,720,971 | | |
$ | 3,663,930 | | |
$ | 26,608,253 | | |
$ | 38,993,154 | | |
$ | (525,521 | ) | |
$ | 426,246 | | |
$ | (3,279 | ) | |
$ | (102,554 | ) | |
$ | (1,959,107 | ) | |
$ | 123,020,621 | | |
$ | 4,144,338 | | |
$ | 127,164,959 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Effect of retrospective application and retrospective adjustment | |
| — | | |
| — | | |
| 11,350 | | |
| — | | |
| — | | |
| (87,052 | ) | |
| (87,052 | ) | |
| (62 | ) | |
| — | | |
| — | | |
| (62 | ) | |
| — | | |
| (75,764 | ) | |
| (11,056 | ) | |
| (86,820 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
BALANCE AT JANUARY 1, 2014 AS ADJUSTED | |
| 7,787,827 | | |
| 78,180,258 | | |
| 7,920,220 | | |
| 8,720,971 | | |
| 3,663,930 | | |
| 26,521,201 | | |
| 38,906,102 | | |
| (525,583 | ) | |
| 426,246 | | |
| (3,279 | ) | |
| (102,616 | ) | |
| (1,959,107 | ) | |
| 122,944,857 | | |
| 4,133,282 | | |
| 127,078,139 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Change in capital surplus from investments in associates accounted for by using equity | |
| — | | |
| — | | |
| 5,612 | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 5,612 | | |
| — | | |
| 5,612 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net profit for the three months ended March 31, 2014 (adjusted) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 3,449,675 | | |
| 3,449,675 | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 3,449,675 | | |
| 118,624 | | |
| 3,568,299 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Other comprehensive income for the three months ended March 31, 2014, net of income tax (adjusted) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 1,541,254 | | |
| 194,849 | | |
| 2,869 | | |
| 1,738,972 | | |
| — | | |
| 1,738,972 | | |
| 49,552 | | |
| 1,788,524 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total comprehensive income for the three months ended March 31, 2014 (adjusted) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 3,449,675 | | |
| 3,449,675 | | |
| 1,541,254 | | |
| 194,849 | | |
| 2,869 | | |
| 1,738,972 | | |
| — | | |
| 5,188,647 | | |
| 168,176 | | |
| 5,356,823 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Issue of ordinary shares under employee share options | |
| 25,149 | | |
| 156,865 | | |
| 317,494 | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 474,359 | | |
| — | | |
| 474,359 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Additional non-controlling interest arising on issue of employee share options by subsidiaries | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 11,709 | | |
| 11,709 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
BALANCE AT MARCH 31, 2014 AS ADJUSTED | |
| 7,812,976 | | |
$ | 78,337,123 | | |
$ | 8,243,326 | | |
$ | 8,720,971 | | |
$ | 3,663,930 | | |
$ | 29,970,876 | | |
$ | 42,355,777 | | |
$ | 1,015,671 | | |
$ | 621,095 | | |
$ | (410 | ) | |
$ | 1,636,356 | | |
$ | (1,959,107 | ) | |
$ | 128,613,475 | | |
$ | 4,313,167 | | |
$ | 132,926,642 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
BALANCE AT JANUARY 1, 2015 | |
| 7,861,725 | | |
$ | 78,715,179 | | |
$ | 15,995,671 | | |
$ | 10,289,878 | | |
$ | 3,353,938 | | |
$ | 38,753,462 | | |
$ | 52,397,278 | | |
$ | 4,541,153 | | |
$ | 526,778 | | |
$ | — | | |
$ | 5,067,931 | | |
$ | (1,959,107 | ) | |
$ | 150,216,952 | | |
$ | 8,219,139 | | |
$ | 158,436,091 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Effect of retrospective application and retrospective adjustment | |
| — | | |
| — | | |
| 17,387 | | |
| — | | |
| — | | |
| (16,040 | ) | |
| (16,040 | ) | |
| 608 | | |
| — | | |
| — | | |
| 608 | | |
| — | | |
| 1,955 | | |
| (41 | ) | |
| 1,914 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
BALANCE AT JANUARY 1, 2015 AS ADJUSTED | |
| 7,861,725 | | |
| 78,715,179 | | |
| 16,013,058 | | |
| 10,289,878 | | |
| 3,353,938 | | |
| 38,737,422 | | |
| 52,381,238 | | |
| 4,541,761 | | |
| 526,778 | | |
| — | | |
| 5,068,539 | | |
| (1,959,107 | ) | |
| 150,218,907 | | |
| 8,219,098 | | |
| 158,438,005 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net profit for the three months ended March 31, 2015 | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 4,469,201 | | |
| 4,469,201 | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 4,469,201 | | |
| 181,235 | | |
| 4,650,436 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Other comprehensive income (loss) for the three months ended March 31, 2015, net of income tax | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (1,617,364 | ) | |
| 38,110 | | |
| — | | |
| (1,579,254 | ) | |
| — | | |
| (1,579,254 | ) | |
| (97,988 | ) | |
| (1,677,242 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total comprehensive income (loss) for the three months ended March 31, 2015 | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 4,469,201 | | |
| 4,469,201 | | |
| (1,617,364 | ) | |
| 38,110 | | |
| — | | |
| (1,579,254 | ) | |
| — | | |
| 2,889,947 | | |
| 83,247 | | |
| 2,973,194 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Buy-back of ordinary shares | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (5,333,406 | ) | |
| (5,333,406 | ) | |
| — | | |
| (5,333,406 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Issue of ordinary shares under employee share options | |
| 27,218 | | |
| 472,771 | | |
| 81,111 | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 553,882 | | |
| — | | |
| 553,882 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Additional non-controlling interest arising on issue of employee share options by subsidiaries | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| 16,396 | | |
| 16,396 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
BALANCE AT MARCH 31, 2015 | |
| 7,888,943 | | |
$ | 79,187,950 | | |
$ | 16,094,169 | | |
$ | 10,289,878 | | |
$ | 3,353,938 | | |
$ | 43,206,623 | | |
$ | 56,850,439 | | |
$ | 2,924,397 | | |
$ | 564,888 | | |
$ | — | | |
$ | 3,489,285 | | |
$ | (7,292,513 | ) | |
$ | 148,329,330 | | |
$ | 8,318,741 | | |
$ | 156,648,071 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
US DOLLARS (Note 4) | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
BALANCE AT MARCH 31, 2015 | |
| 7,888,943 | | |
$ | 2,534,826 | | |
$ | 515,178 | | |
$ | 329,382 | | |
$ | 107,360 | | |
$ | 1,383,054 | | |
$ | 1,819,796 | | |
$ | 93,611 | | |
$ | 18,082 | | |
$ | — | | |
$ | 111,693 | | |
$ | (233,435 | ) | |
$ | 4,748,058 | | |
$ | 266,285 | | |
$ | 5,014,343 | |
The accompanying notes are an integral part
of the consolidated financial statements.
(With Deloitte & Touche review report
dated May 8, 2015)
ADVANCED SEMICONDUCTOR ENGINEERING, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts
in Thousands)
(Reviewed, Not Audited)
| |
For the Three Months Ended March 31 |
| |
2014 (Reviewed after Adjusted) | |
2015 (Reviewed) |
| |
| NT$ | | |
| NT$ | | |
| US$ (Note 4) | |
| |
| | | |
| | | |
| | |
CASH FLOWS FROM OPERATING ACTIVITIES | |
| | | |
| | | |
| | |
Profit before income tax | |
$ | 4,298,312 | | |
$ | 5,506,616 | | |
$ | 176,268 | |
Adjustments for: | |
| | | |
| | | |
| | |
Depreciation expense | |
| 6,269,956 | | |
| 7,256,998 | | |
| 232,298 | |
Amortization expense | |
| 135,271 | | |
| 135,828 | | |
| 4,348 | |
Net (gain) loss on fair value change of financial assets and liabilities at fair value through profit or loss | |
| (326,296 | ) | |
| 968,918 | | |
| 31,015 | |
Interest expense | |
| 589,916 | | |
| 577,332 | | |
| 18,481 | |
Interest income | |
| (58,712 | ) | |
| (51,305 | ) | |
| (1,642 | ) |
Dividend income | |
| (3,417 | ) | |
| (65,750 | ) | |
| (2,105 | ) |
Compensation cost of employee share options | |
| 33,487 | | |
| 12,875 | | |
| 412 | |
Share of loss (profit) of associates | |
| 64,226 | | |
| (3,804 | ) | |
| (122 | ) |
Impairment loss recognized on non-financial assets | |
| 58,668 | | |
| — | | |
| — | |
Reversal of impairment loss recognized on non-financial assets | |
| — | | |
| (216,787 | ) | |
| (6,939 | ) |
Net loss (gain) on foreign currency exchange | |
| 742,054 | | |
| (387,455 | ) | |
| (12,403 | ) |
Others | |
| 105,946 | | |
| 324,051 | | |
| 10,373 | |
Changes in operating assets and liabilities | |
| | | |
| | | |
| | |
Financial assets held for trading | |
| 308,372 | | |
| 535,510 | | |
| 17,142 | |
Trade receivables | |
| 5,393,323 | | |
| 9,899,771 | | |
| 316,894 | |
Other receivables | |
| 30,320 | | |
| 411 | | |
| 13 | |
Inventories | |
| 144,372 | | |
| (3,183,220 | ) | |
| (101,896 | ) |
Other current assets | |
| (27,716 | ) | |
| 528,999 | | |
| 16,933 | |
Financial liabilities held for trading | |
| (137,870 | ) | |
| (166,653 | ) | |
| (5,335 | ) |
Trade payables | |
| (3,517,508 | ) | |
| (3,705,388 | ) | |
| (118,610 | ) |
Other payables | |
| (22,647 | ) | |
| (1,417,585 | ) | |
| (45,377 | ) |
Other current liabilities | |
| (73,957 | ) | |
| 306,642 | | |
| 9,816 | |
Other operating activities items | |
| 29,187 | | |
| 184,121 | | |
| 5,894 | |
| |
| 14,035,287 | | |
| 17,040,125 | | |
| 545,458 | |
Interest received | |
| 69,151 | | |
| 52,766 | | |
| 1,689 | |
Dividend received | |
| 3,417 | | |
| 65,750 | | |
| 2,105 | |
Interest paid | |
| (556,723 | ) | |
| (559,232 | ) | |
| (17,901 | ) |
Income tax paid | |
| (383,502 | ) | |
| (573,431 | ) | |
| (18,356 | ) |
| |
| | | |
| | | |
| | |
Net cash generated from operating activities | |
| 13,167,630 | | |
| 16,025,978 | | |
| 512,995 | |
| |
| | | |
| | | |
| | |
CASH FLOWS FROM INVESTING ACTIVITIES | |
| | | |
| | | |
| | |
Purchase of financial assets designated as at fair value through profit or loss | |
| (23,879,381 | ) | |
| (31,598,532 | ) | |
| (1,011,475 | ) |
Proceeds on sale of financial assets designated as at fair value through profit or loss | |
| 24,072,435 | | |
| 31,595,385 | | |
| 1,011,374 | |
Purchase of available-for-sale financial assets | |
| (1,942,512 | ) | |
| (149,279 | ) | |
| (4,778 | ) |
Proceeds on sale of available-for-sale financial assets | |
| 2,370,171 | | |
| 700,404 | | |
| 22,420 | |
Acquisition of associates | |
| (100,000 | ) | |
| — | | |
| — | |
Payments for property, plant and equipment | |
| (3,975,218 | ) | |
| (7,762,448 | ) | |
| (248,477 | ) |
(Continued)
ADVANCED SEMICONDUCTOR ENGINEERING, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts
in Thousands)
(Reviewed, Not Audited)
| |
For the Three Months Ended March 31 |
| |
2014 (Reviewed after Adjusted) | |
2015 (Reviewed) |
| |
| NT$ | | |
| NT$ | | |
| US$ (Note 4) | |
| |
| | | |
| | | |
| | |
Proceeds from disposal of property, plant and equipment | |
$ | 17,536 | | |
$ | 31,255 | | |
$ | 1,000 | |
Payments for intangible assets | |
| (88,151 | ) | |
| (162,975 | ) | |
| (5,217 | ) |
Increase in other financial assets | |
| (9,806 | ) | |
| (12,013 | ) | |
| (385 | ) |
Decrease (Increase) in other non-current assets | |
| 3,946 | | |
| (32,942 | ) | |
| (1,054 | ) |
| |
| | | |
| | | |
| | |
Net cash used in investing activities | |
| (3,530,980 | ) | |
| (7,391,145 | ) | |
| (236,592 | ) |
| |
| | | |
| | | |
| | |
CASH FLOWS FROM FINANCING ACTIVITIES | |
| | | |
| | | |
| | |
Repayment of short-term borrowings | |
| (11,399,502 | ) | |
| (4,041,624 | ) | |
| (129,373 | ) |
Proceeds from long-term borrowings | |
| 4,853,794 | | |
| 5,005,910 | | |
| 160,240 | |
Repayment of long-term borrowings | |
| (6,123,956 | ) | |
| (5,803,317 | ) | |
| (185,766 | ) |
Proceeds from exercise of employee share options | |
| 452,581 | | |
| 557,403 | | |
| 17,843 | |
Payments for buy-back of ordinary shares | |
| — | | |
| (5,333,406 | ) | |
| (170,724 | ) |
Other financing activities items | |
| 2,505 | | |
| (3,136 | ) | |
| (100 | ) |
| |
| | | |
| | | |
| | |
Net cash used in financing activities | |
| (12,214,578 | ) | |
| (9,618,170 | ) | |
| (307,880 | ) |
| |
| | | |
| | | |
| | |
EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH AND CASH EQUIVALENTS | |
| 1,129,045 | | |
| (1,296,637 | ) | |
| (41,506 | ) |
| |
| | | |
| | | |
| | |
NET DECREASE IN CASH AND CASH EQUIVALENTS | |
| (1,448,883 | ) | |
| (2,279,974 | ) | |
| (72,983 | ) |
| |
| | | |
| | | |
| | |
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD | |
| 45,026,371 | | |
| 51,694,410 | | |
| 1,654,751 | |
| |
| | | |
| | | |
| | |
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD | |
$ | 43,577,488 | | |
$ | 49,414,436 | | |
$ | 1,581,768 | |
| |
| | | |
| | | |
| (Concluded) | |
The accompanying notes are an integral part
of the consolidated financial statements.
(With Deloitte & Touche review report
dated May 8, 2015)
ADVANCED SEMICONDUCTOR ENGINEERING, INC.
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31,
2014 AND 2015
(Amounts
in Thousands, Unless Stated Otherwise)
(Reviewed, Not Audited)
Advanced Semiconductor Engineering,
Inc. (the “Company”), a corporation incorporated under the laws of Republic of China (the “ROC”), and its
subsidiaries (collectively referred to as the “Group”) offer a comprehensive range of semiconductors packaging, testing,
and electronic manufacturing services (“EMS”).
The Company’s ordinary
shares have been listed on the Taiwan Stock Exchange (the “TSE”) under the symbol “2311”. Since September
2000, the ordinary shares of the Company have been traded on the New York Stock Exchange (the “NYSE”) under the symbol
“ASX” in the form of American Depositary Shares (“ADS”). The ordinary shares of its subsidiary, Universal
Scientific Industrial (Shanghai) Co., Ltd (the “USISH”), have been listed on the Shanghai Stock Exchange (the “SSE”)
under the symbol “601231”.
The functional currency of
the Company and the reporting currency of the consolidated financial statements are both New Taiwan dollar (NT$).
| 2. | APPROVAL OF FINANCIAL STATEMENTS |
The consolidated financial
statements were authorized for issue by the management on May 8, 2015.
| 3. | APPLICATION OF NEW, AMENDED AND REVISED STANDARDS AND INTERPRETATIONS |
| a. | Initial application of the 2013 version of the International Financial Reporting Standards (IFRS),
International Accounting Standards (IAS), Interpretations of IFRS (IFRIC), and Interpretations of IAS (SIC) endorsed by the FSC |
Rule No. 1030029342 and Rule
No. 1030010325 issued by the FSC on April 3, 2014, stipulated that the Group should apply the 2013 version of IFRS, IAS, IFRIC
and SIC (collectively, the “IFRSs”) endorsed by the FSC starting January 1, 2015.
Except for the following, whenever
applied, the initial application of the 2013 IFRSs version would not have any material impact on the Group’s accounting policies:
| 1) | IFRS 12 “Disclosure of Interests in Other Entities” |
IFRS 12 is a new disclosure
standard and is applicable to entities that have interests in subsidiaries, joint arrangements, associates and/or unconsolidated
structured entities. In general, the disclosure requirements in IFRS 12 are more extensive than in the previous standards.
| 2) | IFRS 13 “Fair Value Measurement” |
IFRS 13 establishes a single
source of guidance for fair value measurements. It defines fair value, establishes a framework for measuring fair value, and requires
disclosures about fair value measurements. The disclosure requirements in IFRS 13 are more extensive than those required by the
previous standards. For example, quantitative and qualitative disclosures based on the
three-level fair value hierarchy currently
required for financial instruments only will be extended by IFRS 13 to cover all assets and liabilities within its scope.
The fair value measurements
under IFRS 13 will be applied prospectively from January 1, 2015. Refer to Note 30 for related disclosures.
| 3) | Amendments to IAS 1 “Presentation of Items of Other Comprehensive Income” |
The amendments to IAS 1 requires
items of other comprehensive income to be grouped into those items that (1) will not be reclassified subsequently to profit or
loss; and (2) may be reclassified subsequently to profit or loss. Income taxes on related items of other comprehensive income are
grouped on the same basis. Under current IAS 1, there were no such requirements.
The Group retrospectively applied
the above amendments starting in 2015. Items that will not be reclassified subsequently to profit or loss are remeasurements of
the defined benefit plans and share of remeasurements of the defined benefit plans of associates accounted for using the equity
method. Items that may be reclassified to profit or loss are the exchange differences on translating foreign operations, unrealized
gain (loss) on available-for-sale financial assets, cash flow hedges, and share of the other comprehensive income (except the share
of the remeasurements of the defined benefit plans) of associates accounted for using the equity method. However, the application
of the above amendments will not have any impact on the net profit, other comprehensive income (net of income tax), and total comprehensive
income for the period.
| 4) | Revision to IAS 19 “Employee Benefits” |
Revised IAS 19 requires the
recognition of changes in defined benefit obligations and in the fair value of plan assets when they occur, and hence eliminates
the “corridor approach” permitted under current IAS 19 and accelerate the recognition of past service costs. The revision
requires all remeasurements of the defined benefit plans to be recognized immediately through other comprehensive income in order
for the net pension asset or liability to reflect the full value of the plan deficit or surplus. Remeasurement of the defined benefit
plans is presented separately as other equity.
Furthermore, the interest cost
and expected return on plan assets used in current IAS 19 are replaced with a “net interest” amount, which is calculated
by applying the discount rate to the net defined benefit liability or asset. In addition, the revised IAS 19 introduces certain
changes in the presentation of the defined benefit cost, and also includes more extensive disclosures.
On initial application of the
revised IAS 19, the changes in cumulative employee benefit costs as of January 1, 2014 resulting from the retrospective application
are adjusted to net defined benefit liabilities, deferred tax assets, capital surplus, retained earnings, other equity and non-controlling
interests; however, the carrying amount of inventory is not adjusted. In addition, in preparing the consolidated financial statements
for the year ended December 31, 2015, the Group elects not to present 2014 comparative information about the sensitivity analysis
of the defined benefit obligation.
The initial application of
the 2013 IFRSs has no material impact on the current period. The impact on the prior reporting periods is set out below:
| |
As Originally Stated | |
Adjustments Arising from Retrospective Application | |
Adjusted |
| |
| |
| |
|
Impact on Assets, Liabilities and Equity | |
| |
| |
|
| |
| | | |
| | | |
| | |
December 31, 2014 | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
Deferred tax assets | |
$ | 4,493,664 | | |
$ | 13,308 | | |
$ | 4,506,972 | |
Net defined benefit liabilities | |
| 4,371,136 | | |
| 11,394 | | |
| 4,382,530 | |
Capital surplus | |
| 15,995,671 | | |
| 17,387 | | |
| 16,013,058 | |
Retained earnings | |
| 52,397,278 | | |
| (16,040 | ) | |
| 52,381,238 | |
Other equity | |
| 5,067,931 | | |
| 608 | | |
| 5,068,539 | |
Non-controlling interests | |
| 8,219,139 | | |
| (41 | ) | |
| 8,219,098 | |
| |
| | | |
| | | |
| | |
March 31, 2014 | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
Deferred tax assets | |
| 3,972,035 | | |
| 15,234 | | |
| 3,987,269 | |
Net defined benefit liabilities | |
| 4,523,706 | | |
| 89,608 | | |
| 4,613,314 | |
Capital surplus | |
| 8,231,976 | | |
| 11,350 | | |
| 8,243,326 | |
Retained earnings | |
| 42,431,026 | | |
| (75,249 | ) | |
| 42,355,777 | |
Other equity | |
| 1,635,793 | | |
| 563 | | |
| 1,636,356 | |
Non-controlling interests | |
| 4,324,205 | | |
| (11,038 | ) | |
| 4,313,167 | |
| |
| | | |
| | | |
| | |
January 1, 2014 | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
Deferred tax assets | |
| 3,765,482 | | |
| 17,783 | | |
| 3,783,265 | |
Net defined benefit liabilities | |
| 4,441,357 | | |
| 104,603 | | |
| 4,545,960 | |
Capital surplus | |
| 7,908,870 | | |
| 11,350 | | |
| 7,920,220 | |
Retained earnings | |
| 38,993,154 | | |
| (87,052 | ) | |
| 38,906,102 | |
Other equity | |
| (102,554 | ) | |
| (62 | ) | |
| (102,616 | ) |
Non-controlling interests | |
| 4,144,338 | | |
| (11,056 | ) | |
| 4,133,282 | |
| |
| | | |
| | | |
| | |
Impact on Total Comprehensive Income | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
For the three months ended March 31, 2014 | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
Operating cost | |
| 44,350,522 | | |
| (10,182 | ) | |
| 44,340,340 | |
Operating expense | |
| 5,279,386 | | |
| (4,813 | ) | |
| 5,274,573 | |
Income tax expense | |
| 726,839 | | |
| 3,174 | | |
| 730,013 | |
Net profit for the period | |
| 3,556,478 | | |
| 11,821 | | |
| 3,568,299 | |
| |
| | | |
| | | |
| | |
Items that may be reclassified to profit or loss: | |
| | | |
| | | |
| | |
Exchange differences on translating foreign operations | |
| 1,588,607 | | |
| 625 | | |
| 1,589,232 | |
Total comprehensive income for the period | |
| 5,344,377 | | |
| 12,446 | | |
| 5,356,823 | |
| |
| | | |
| | | |
| | |
(Continued)
| |
As Originally Stated | |
Adjustments Arising from Retrospective Application | |
Adjusted |
| |
| |
| |
|
Net profit attributable to: | |
| | | |
| | | |
| | |
Owners of the Company | |
$ | 3,437,872 | | |
$ | 11,803 | | |
$ | 3,449,675 | |
Non-controlling interests | |
| 118,606 | | |
| 18 | | |
| 118,624 | |
| |
| | | |
| | | |
| | |
| |
$ | 3,556,478 | | |
$ | 11,821 | | |
$ | 3,568,299 | |
| |
| | | |
| | | |
| | |
Total comprehensive income attributable to: | |
| | | |
| | | |
| | |
Owners of the Company | |
$ | 5,176,219 | | |
$ | 12,428 | | |
$ | 5,188,647 | |
Non-controlling interests | |
| 168,158 | | |
| 18 | | |
| 168,176 | |
| |
| | | |
| | | |
| | |
| |
$ | 5,344,377 | | |
$ | 12,446 | | |
$ | 5,356,823 | |
(Concluded)
| 5) | Annual Improvements to IFRSs: 2009-2011 Cycle |
Several standards including
IFRS 1 “First-time Adoption of International Financial Reporting Standards”, IAS 1 “Presentation of Financial
Statements”, IAS 16 “Property, Plant and Equipment”, IAS 32 “Financial Instruments: Presentation”
and IAS 34 “Interim Financial Reporting” were amended in this annual improvement.
The amendments to IAS 1 clarify
that an entity is required to present a balance sheet as at the beginning of the preceding period when a) it applies an accounting
policy retrospectively, or makes a retrospective restatement or reclassifies items in its financial statements, and b) the retrospective
application, restatement or reclassification has a material effect on the information in the balance sheet at the beginning of
the preceding period. The amendments also clarify that related notes are not required to accompany the balance sheet at the beginning
of the preceding period.
The initial application of
the 2013 IFRSs version in 2015 has material effect on the consolidated balance sheet as of January 1, 2014. In preparing the consolidated
financial statements for the year ended December 31, 2015, the Group would present the consolidated balance sheet as of January
1, 2014 in accordance of the above amendments to IAS 1 and disclose related information in accordance with IAS 8 “Accounting
Policies, Changes in Accounting Estimates and Errors”, but the Group is not required to make disclosures about the line items
of the balance sheet as of January 1, 2014.
| b. | New IFRSs in issue but not yet endorsed by the FSC |
The Group has not applied the
following New IFRSs issued by the IASB but not yet endorsed by the FSC. As of the date the consolidated financial statements were
authorized for issue, the FSC has not announced their effective dates.
New IFRSs |
|
Effective Date
Announced by IASB (Note 1)
|
|
|
|
Annual Improvements to IFRSs 2010-2012 Cycle |
|
July 1, 2014 or transactions on or after July 1, 2014 |
Annual Improvements to IFRSs 2011-2013 Cycle |
|
July 1, 2014 |
(Continued)
New IFRSs |
|
Effective Date
Announced by IASB (Note 1) |
|
|
|
Annual Improvements to IFRSs 2012-2014 Cycle |
|
January 1, 2016 (Note 2) |
IFRS 9 “Financial Instruments” |
|
January 1, 2018 |
Amendments to IFRS 9 and IFRS 7 “Mandatory Effective Date of IFRS 9 and Transition Disclosures” |
|
January 1, 2018 |
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture” |
|
January 1, 2016 (Note 3) |
Amendments to IFRS 10, IFRS 12 and IAS 28 “Investment Entities: Applying the Consolidation Exception” |
|
January 1, 2016 |
Amendment to IFRS 11 “Accounting for Acquisitions of Interests in Joint Operations” |
|
January 1, 2016 |
IFRS 14 “Regulatory Deferral Accounts” |
|
January 1, 2016 |
IFRS 15 “Revenue from Contracts with Customers” |
|
January 1, 2017 |
Amendment to IAS 1 “Disclosure Initiative” |
|
January 1, 2016 |
Amendments to IAS 16 and IAS 38 “Clarification of Acceptable Methods of Depreciation and Amortization” |
|
January 1, 2016 |
Amendments to IAS 16 and IAS 41 “Agriculture: Bearer Plants” |
|
January 1, 2016 |
Amendment to IAS 19 “Defined Benefit Plans: Employee Contributions” |
|
July 1, 2014 |
Amendment to IAS 36 “Impairment of Assets: Recoverable Amount Disclosures for Non-financial Assets” |
|
January 1, 2014 |
Amendment to IAS 39 “Novation of Derivatives and Continuation of Hedge Accounting” |
|
January 1, 2014 |
IFRIC 21 “Levies” |
|
January 1, 2014 |
(Concluded)
Note 1: |
Unless stated otherwise, the above
IFRSs are effective for annual periods beginning on or after their respective effective dates. |
|
|
Note 2: |
The amendment to IFRS 5 is applied prospectively to changes in a method of disposal that occur in annual periods beginning on or after January 1, 2016; the remaining amendments are effective for annual periods beginning on or after January 1, 2016. |
|
|
Note 3: |
Prospectively applicable to transactions occurring in annual periods beginning on or after January 1, 2016. |
The initial application
of the above New IFRSs, whenever applied, would not have any material impact on the Group’s accounting policies, except
for the following:
1) | IFRS 9 “Financial Instruments” |
Recognition and measurement
of financial assets
With regards to financial assets,
all recognized financial assets that are within the scope of IAS 39 “Financial Instruments: Recognition and Measurement”
are subsequently measured at amortized cost or fair value. Under IFRS 9, the requirement for the classification of financial assets
is stated below:
For the Group’s debt
instruments that have contractual cash flows that are solely payments of principal and interest on the principal amount outstanding,
their classification and measurement are as follows:
a) | For debt instruments, if they are held within a business model whose objective is to collect the
contractual cash flows, the financial assets are measured at amortized cost and are assessed for |
| impairment continuously with impairment
loss recognized in profit or loss, if any. Interest revenue is recognized in profit or loss by using the effective interest method; |
b) | For debt instruments, if they are held within a business model whose objective is achieved by both
the collecting of contractual cash flows and the selling of financial assets, the financial assets are measured at fair value through
other comprehensive income (FVTOCI) and are assessed for impairment. Interest revenue is recognized in profit or loss by using
the effective interest method, and other gain or loss shall be recognized in other comprehensive income, except for impairment
gains or losses and foreign exchange gains and losses. When the debt instruments are derecognized or reclassified, the cumulative
gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss. |
Except for above, all other
financial assets are measured at fair value through profit or loss. However, the Group may make an irrevocable election to present
subsequent changes in the fair value of an equity investment (that is not held for trading) in other comprehensive income, with
only dividend income generally recognized in profit or loss. No subsequent impairment assessment is required, and the cumulative
gain or loss previously recognized in other comprehensive income cannot be reclassified from equity to profit or loss.
The impairment of financial
assets
IFRS 9 requires that impairment
loss on financial assets is recognized by using the “Expected Credit Losses Model”. The credit loss allowance is required
for financial assets measured at amortized cost, financial assets mandatorily measured at FVTOCI, lease receivables, contract assets
arising from IFRS 15 “Revenue from Contracts with Customers”, certain written loan commitments and financial guarantee
contracts. A loss allowance for the 12-month expected credit losses is required for a financial asset if its credit risk has not
increased significantly since initial recognition. A loss allowance for full lifetime expected credit losses is required for a
financial asset if its credit risk has increased significantly since initial recognition and is not low. However, a loss allowance
for full lifetime expected credit losses is required for trade receivables that do not constitute a financing transaction.
For purchased or originated
credit-impaired financial assets, the Group takes into account the expected credit losses on initial recognition in calculating
the credit-adjusted effective interest rate. Subsequently, any changes in expected losses are recognized as a loss allowance with
a corresponding gain or loss recognized in profit or loss.
Hedge accounting
The main changes in hedge accounting
amended the application requirements for hedge accounting to better reflect the entity’s risk management activities. Compared
with IAS 39, the main changes include: (1) enhancing types of transactions eligible for hedge accounting, specifically broadening
the risk eligible for hedge accounting of non-financial items; (2) changing the way hedging derivative instruments are accounted
for to reduce profit or loss volatility; and (3) replacing retrospective effectiveness assessment with the principle of economic
relationship between the hedging instrument and the hedged item.
2) | Amendment to IAS 36 “Recoverable Amount Disclosures
for Non-financial Assets” |
In
issuing IFRS 13 “Fair Value Measurement”, the IASB made consequential amendment to the disclosure requirements in
IAS 36 “Impairment of Assets”, introducing a requirement to disclose in every reporting period the recoverable amount
of an asset or each cash-generating unit. The amendment clarifies that such disclosure of recoverable amounts is required only
when an impairment loss has been recognized or reversed during the period. Furthermore, the Group is required to disclose the
discount rate used in measurements of the recoverable amount based on fair value less costs of disposal measured using a present
value technique.
3) | IFRS 15 “Revenue from Contracts with Customers” |
IFRS
15 establishes principles for recognizing revenue that apply to all contracts with customers, and will supersedes IAS 18 “Revenue”,
IAS 11 “Construction Contracts” and a number of revenue-related interpretations from January 1, 2017.
When
applying IFRS 15, an entity shall recognize revenue by applying the following steps:
| | Identify the contract with the customer; |
| | Identify the performance obligations in the contract; |
| | Determine the transaction price; |
| | Allocate the transaction price to the performance obligations
in the contracts; and |
| | Recognize revenue when the entity satisfies a performance
obligation. |
When
IFRS 15 is effective, the Group may elect to apply this Standard either retrospectively to each prior reporting period presented
or retrospectively with the cumulative effect of initially applying this Standard recognized at the date of initial application.
4) | Amendments to IFRS 10 and IAS 28 “Sale or Contribution
of Assets between an Investor and its Associate or Joint Venture” |
The
amendments stipulated that, when the Group sells or contributes assets that constitute a business (as defined in IFRS 3) to an
associate or joint venture, the gain or loss resulting from the transaction is recognized in full. Also, when the Group loses
control of a subsidiary that contains a business but retains significant influence or joint control, the gain or loss resulting
from the transaction is recognized in full.
Conversely,
when the Group sells or contributes assets that do not constitute a business to an associate or joint venture, the gain or loss
resulting from the transaction is recognized only to the extent of the unrelated investors’ interest in the associate or
joint venture, i.e. the entity’s share of the gain or loss is eliminated. Also, when the Group loses control of a subsidiary
that does not contain a business but retains significant influence or joint control in an associate or a joint venture, the gain
or loss resulting from the transaction is recognized only to the extent of the unrelated investors’ interest in the associate
or joint venture, i.e. the entity’s share of the gain or loss is eliminated.
5) | Amendment to IAS 1 “Disclosure Initiative” |
The
amendment clarifies that the consolidated financial statements should be prepared for the purpose of disclosing material information.
To improve the understandability of its consolidated financial statements, the Group should disaggregate the disclosure of material
items into their different natures or functions, and disaggregate material information from immaterial information.
The
amendment further clarifies that the Group should consider the understandability and comparability of its consolidated financial
statements to determine a systematic order in presenting its footnotes.
Except for the above impact,
as of the date the consolidated financial statements were authorized for issue, the Group is continuously assessing the possible
impact that the application of other standards and interpretations will have on the Group’s financial position and results
of operations, and will disclose the relevant impact when the assessment is completed.
| 4. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
| a. | Statement of Compliance |
The consolidated financial
statements have been prepared in accordance with IAS 34 “Interim Financial Reporting” endorsed by the FSC. Disclosure
information included in interim financial reports is less than disclosures required in a full set of annual financial reports.
The consolidated financial
statements have been prepared on the historical cost basis except for certain financial instruments that are measured at fair value.
Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.
| c. | Classification of Current and Non-current Assets and Liabilities |
Current assets include cash
and cash equivalents and those assets held primarily for trading purposes or to be realized within twelve months after the balance
sheet date, unless the asset is to be used for an exchange or to settle a liability, or otherwise remains restricted, at more than
twelve months after the balance sheet date. Property, plant and equipment, intangible assets, other than assets classified as current
are classified as non-current. Current liabilities are obligations incurred for trading purposes or to be settled within twelve
months after the balance sheet date and liabilities that do not have an unconditional right to defer settlement for at least twelve
months after the balance sheet date. Liabilities that are not classified as current are classified as non-current.
For the Group’s real
estate business whose operating cycle is longer than one year, the length of the operating cycle is the basis for classifying the
Group’s real estate related assets and liabilities as current or non-current.
| 1) | Principles for preparing consolidated financial statements |
The consolidated financial
statements incorporate the financial statements of the Company and the entities controlled by the Company (i.e. its subsidiaries).
Control is achieved when the Group:
| | has power over the investee; |
| | is exposed, or has rights, to variable returns from its involvement with the investee; and |
| | has the ability to use its power to affect its returns. |
The Group reassesses whether
or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements
of control listed above.
When the Group has less than
a majority of the voting rights of an investee, it has power over the investee when the voting rights are sufficient to give it
the practical ability to direct the relevant activities of the investee unilaterally. The Group considers all relevant facts and
circumstances in assessing whether or not the Group's voting rights in an investee are sufficient to give it power, including:
| | the size of the Group's holding of voting rights relative to the size and dispersion of holdings
of the other vote holders; |
| | potential voting rights held by the Group, other vote holders or other parties; |
| | rights arising from other contractual arrangements; and |
| | any additional facts and circumstances that indicate that the Group has, or does not have, the
current ability to direct the relevant activities at the time that decisions need to be made, including voting patterns at previous
shareholders' meetings. |
Consolidation of a subsidiary
begins when the Group obtains control over the subsidiary and ceases when the Group loses control over the subsidiary. Specifically,
income and expenses of subsidiaries acquired or disposed of during the period are included in the consolidated statement of comprehensive
income from the effective date of acquisition or up to the effective date of disposal, as appropriate.
When necessary, adjustments
are made to the financial statements of subsidiaries to bring their accounting policies in line with those used by the Company.
All intra-group transactions,
balances, income and expenses are eliminated in full upon consolidation.
Attribution of total comprehensive
income to non-controlling interests
Total comprehensive income
of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling
interests having a deficit balance.
Changes in the Group’s
ownership interests in existing subsidiaries
Changes in the Group’s
ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as equity
transactions. The carrying amounts of the Group’s interests and the non-controlling interests are adjusted to reflect the
changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests
are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to the owners
of the Company.
When the Group loses control
over a subsidiary, a gain or loss is recognized in profit or loss and is calculated as the difference between (i) the aggregate
of the fair value of the consideration received and any investment retained in the former subsidiary at its fair value at the date
when control is lost and (ii) the assets (including any goodwill) and liabilities and any non-controlling interests of the former
subsidiary at their carrying amounts at the date when control is lost. The Group accounts for all amounts recognized in other comprehensive
income in relation to that subsidiary on the same basis as would be required if the Group had directly disposed of the related
assets or liabilities.
| 2) | Subsidiaries included in the consolidated financial statements |
|
|
|
|
|
|
Percentage of Ownership (%) |
Name of Investee |
|
Main Businesses |
|
Establishment and
Operating Location
|
|
March 31, 2014 |
|
December 31, 2014 |
|
March 31, 2015 |
|
|
|
|
|
|
|
|
|
|
|
A.S.E. Holding Limited |
|
Holding company |
|
Bermuda |
|
100.0 |
|
100.0 |
|
100.0 |
J & R Holding Limited (“J&R Holding”) |
|
Holding company |
|
Bermuda |
|
100.0 |
|
100.0 |
|
100.0 |
Innosource Limited |
|
Holding company |
|
British Virgin Islands |
|
100.0 |
|
100.0 |
|
100.0 |
Omniquest Industrial Limited |
|
Holding company |
|
British Virgin Islands |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Marketing & Service Japan Co., Ltd. |
|
Engaged in marketing and sales services |
|
Japan |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Test, Inc. |
|
Engaged in the testing of semiconductors |
|
Kaohsiung, ROC |
|
100.0 |
|
100.0 |
|
100.0 |
Universal Scientific Industrial Co., Ltd. (“USI”) |
|
Engaged in the manufacturing, processing and sale of computers, computer peripherals and related accessories |
|
Nantou, ROC |
|
99.2 |
|
99.2 |
|
99.2 |
(Continued)
|
|
|
|
|
|
Percentage of Ownership (%) |
Name of Investee |
|
Main Businesses |
|
Establishment and
Operating Location |
|
March 31, 2014 |
|
December 31, 2014 |
|
March 31, 2015 |
|
|
|
|
|
|
|
|
|
|
|
Luchu Development Corporation |
|
Engaged in the development of real estate properties |
|
Taipei, ROC |
|
86.1 |
|
86.1 |
|
86.1 |
Alto Enterprises Limited |
|
Holding company |
|
British Virgin Islands |
|
100.0 |
|
100.0 |
|
100.0 |
Super Zone Holdings Limited |
|
Holding company |
|
Hong Kong |
|
100.0 |
|
100.0 |
|
100.0 |
ASE (Kun Shan) Inc. |
|
Engaged in the packaging and testing of semiconductors |
|
Kun Shan, China |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Investment (Kun Shan) Limited |
|
Holding company |
|
Kun Shan, China |
|
100.0 |
|
100.0 |
|
100.0 |
Advanced Semiconductor Engineering (China) Ltd. |
|
Will engage in the packaging and testing of semiconductors |
|
Shanghai, China |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Investment (Labuan) Inc. |
|
Holding company |
|
Malaysia |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Test Limited (“ASE Test”) |
|
Holding company |
|
Singapore |
|
100.0 |
|
100.0 |
|
100.0 |
ASE (Korea) Inc. |
|
Engaged in the packaging and testing of semiconductors |
|
Korea |
|
100.0 |
|
100.0 |
|
100.0 |
J&R Industrial Inc. |
|
Engaged in leasing equipment and investing activity |
|
Kaohsiung, ROC |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Japan Co., Ltd. |
|
Engaged in the packaging and testing of semiconductors |
|
Japan |
|
100.0 |
|
100.0 |
|
100.0 |
ASE (U.S.) Inc. |
|
After-sales service and sales support |
|
U.S.A. |
|
100.0 |
|
100.0 |
|
100.0 |
Global Advanced Packaging Technology Limited, Cayman Islands |
|
Holding company |
|
British Cayman Islands |
|
100.0 |
|
100.0 |
|
100.0 |
ASE WeiHai Inc. |
|
Engaged in the packaging and testing of semiconductors |
|
Shandong, China |
|
100.0 |
|
100.0 |
|
100.0 |
Suzhou ASEN Semiconductors Co., Ltd. |
|
Engaged in the packaging and testing of semiconductors |
|
Suzhou, China |
|
60.0 |
|
60.0 |
|
60.0 |
Anstock Limited |
|
Engaged in financing activity |
|
British Cayman Islands |
|
100.0 |
|
100.0 |
|
100.0 |
Anstock II Limited |
|
Engaged in financing activity and established in July 2014 |
|
British Cayman Islands |
|
- |
|
100.0 |
|
100.0 |
ASE Module (Shanghai) Inc. |
|
Will engage in the production and sale of electronic components and printed circuit boards |
|
Shanghai, China |
|
100.0 |
|
100.0 |
|
100.0 |
ASE (Shanghai) Inc. |
|
Engaged in the production of substrates |
|
Shanghai, China |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Corporation |
|
Holding company |
|
British Cayman Islands |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Mauritius Inc. |
|
Holding company |
|
Mauritius |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Labuan Inc. |
|
Holding company |
|
Malaysia |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Module (Kunshan) Inc. |
|
Merged into ASE (Kun Shan) Inc. in September 2014 |
|
Kun Shan, China |
|
100.0 |
|
100.0 |
|
- |
Shanghai Ding Hui Real Estate Development Co., Ltd. |
|
Engaged in the development, construction and sale of real estate properties |
|
Shanghai, China |
|
100.0 |
|
100.0 |
|
100.0 |
Shanghai Ding Qi Property Management Co., Ltd. |
|
Engaged in the management of real estate properties and was established in January 2015 |
|
Shanghai, China |
|
- |
|
- |
|
100.0 |
Advanced Semiconductor Engineering (HK) Limited |
|
Engaged in the trading of substrates |
|
Hong Kong |
|
100.0 |
|
100.0 |
|
100.0 |
Shanghai Ding Wei Real Estate Development Co., Ltd. |
|
Engaged in the development, construction and leasing of real estate properties |
|
Shanghai, China |
|
100.0 |
|
100.0 |
|
100.0 |
Shanghai Ding Yu Real Estate Development Co., Ltd. |
|
Engaged in the development, construction and leasing of real estate properties |
|
Shanghai, China |
|
100.0 |
|
100.0 |
|
100.0 |
Kun Shan Ding Yue Real Estate Development Co., Ltd. |
|
Engaged in the development, construction and leasing of real estate properties |
|
Kun Shan, China |
|
100.0 |
|
100.0 |
|
100.0 |
Kun Shan Ding Hong Real Estate Development Co., Ltd |
|
Engaged in the development, construction and leasing of real estate properties |
|
Kun Shan, China |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Electronics Inc. |
|
Engaged in the production of substrates |
|
Kaohsiung, ROC |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Test Holdings, Ltd. |
|
Holding company |
|
British Cayman Islands |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Holdings (Singapore) Pte Ltd |
|
Holding company |
|
Singapore |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Test Finance Limited |
|
In the process of liquidation |
|
Mauritius |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Singapore Pte. Ltd. |
|
Engaged in the packaging and testing of semiconductors |
|
Singapore |
|
100.0 |
|
100.0 |
|
100.0 |
ISE Labs, Inc. |
|
Engaged in the testing of semiconductors |
|
U.S.A. |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Electronics (M) Sdn. Bhd. |
|
Engaged in the packaging and testing of semiconductors |
|
Malaysia |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Assembly & Test (Shanghai) Limited |
|
Engaged in the packaging and testing of semiconductors |
|
Shanghai, China |
|
100.0 |
|
100.0 |
|
100.0 |
ASE Trading (Shanghai) Ltd. |
|
Engaged in trading activity and was invested by ASE Assembly & Test (Shanghai) Limited in January 2015 |
|
Shanghai, China |
|
- |
|
- |
|
100.0 |
(Continued)
|
|
|
|
|
|
Percentage of Ownership (%) |
Name of Investee |
|
Main Businesses |
|
Establishment and
Operating Location
|
|
March 31, 2014 |
|
December 31, 2014 |
|
March 31, 2015 |
|
|
|
|
|
|
|
|
|
|
|
Wuxi Tongzhi Microelectronics Co., Ltd. |
|
Engaged in the packaging and testing of semiconductors |
|
Wuxi, China |
|
100.0 |
|
100.0 |
|
100.0 |
Huntington Holdings International Co., Ltd. |
|
Holding company |
|
British Virgin Islands |
|
99.2 |
|
99.2 |
|
99.2 |
Senetex Investment Co., Ltd. |
|
In the process of liquidation |
|
Nantou, ROC |
|
99.2 |
|
99.2 |
|
99.2 |
Unitech Holdings International Co., Ltd. |
|
Holding company |
|
British Virgin Islands |
|
99.2 |
|
99.2 |
|
99.2 |
Real Tech Holdings Limited |
|
Holding company |
|
British Virgin Islands |
|
99.2 |
|
99.2 |
|
99.2 |
Universal ABIT Holding Co., Ltd. |
|
Holding company |
|
British Cayman Islands |
|
99.2 |
|
99.2 |
|
99.2 |
Rising Capital Investment Limited |
|
Holding company |
|
British Virgin Islands |
|
99.2 |
|
99.2 |
|
99.2 |
Rise Accord Limited |
|
Holding company |
|
British Virgin Islands |
|
99.2 |
|
99.2 |
|
99.2 |
Cubuy Corporation |
|
Engaged in the trading of computer systems |
|
Shanghai, China |
|
99.2 |
|
99.2 |
|
99.2 |
Universal Scientific Industrial (Kunshan) Co., Ltd. |
|
Engaged in the manufacturing and sale of computer assistance system and related peripherals |
|
Kun Shan, China |
|
99.2 |
|
99.2 |
|
99.2 |
USI Enterprise Limited (“USIE”) |
|
Holding company |
|
Hong Kong |
|
99.1 |
|
98.7 |
|
98.7 |
Universal Scientific Industrial (Shanghai) Co., Ltd. (“USISH”) |
|
Engaged in the designing, manufacturing and sale of electronic components |
|
Shanghai, China |
|
88.6 |
|
82.1 |
|
82.1 |
Universal Global Technology Co., Limited |
|
Holding company |
|
Hong Kong |
|
88.6 |
|
82.1 |
|
82.1 |
Universal Global Technology (Kunshan) Co., Ltd. |
|
Engaged in the designing and manufacturing of electronic components |
|
Kun Shan, China |
|
88.6 |
|
82.1 |
|
82.1 |
Universal Global Technology (Shanghai) Co., Ltd. |
|
Engaged in the processing and sales of computer and communication peripherals as well as business in import and export of goods and technology |
|
Shanghai, China |
|
88.6 |
|
82.1 |
|
82.1 |
Universal Global Electronics (Shanghai) Co., Ltd. |
|
Engaged in the sale of electronic components and telecommunications equipment and established in May 2014 |
|
Shanghai, China |
|
- |
|
82.1 |
|
82.1 |
Universal Global Industrial Co., Limited |
|
Engaged in manufacturing, trading and investing activity |
|
Hong Kong |
|
88.6 |
|
82.1 |
|
82.1 |
Universal Global Scientific Industrial Co., Ltd. |
|
Engaged in the manufacturing of components of telecomm and cars and provision of related R&D services |
|
Nantou, ROC |
|
88.6 |
|
82.1 |
|
82.1 |
USI Manufacturing Service, Inc. |
|
Engaged in the manufacturing and processing of motherboards and wireless network communication and provision of related technical service |
|
U.S.A. |
|
88.6 |
|
82.1 |
|
82.1 |
Universal Scientific Industrial De Mexico S.A. De C.V. |
|
Engaged in the assembling of motherboards and computer components |
|
Mexico |
|
88.6 |
|
82.1 |
|
82.1 |
USI Japan Co., Ltd. |
|
Engaged in the manufacturing and sale of computer peripherals, integrated chip and other related accessories |
|
Japan |
|
88.6 |
|
82.1 |
|
82.1 |
USI@Work, Inc. |
|
After-sale service |
|
U.S.A. |
|
88.6 |
|
82.1 |
|
82.1 |
USI Electronics (Shenzhen) Co., Ltd. |
|
Engaged in the design, manufacturing and sale of motherboards and computer peripherals |
|
Shenzhen, China |
|
88.6 |
|
82.1 |
|
82.1 |
(Concluded)
In November 2014, USISH completed
its cash capital increase of CNY2,017,690 thousand and the Group’s shareholdings of USISH decreased from 88.6% to 82.1% since
the Group did not subscribe for additional new shares.
The transaction was accounted
for as an equity transaction since the Group did not cease to have control over USISH and, as a result, in 2014, capital surplus
was charged an addition of NT$6,877,101 thousand including the effect from the retrospective application of revised IAS 19.
Acquisitions of businesses
are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value,
which is calculated as the sum of the acquisition-date (i.e. the date when the Group obtains control) fair values of the assets
transferred by the Group, liabilities incurred by the Group to the former owners of the acquiree and the equity interests issued
by the Group in exchange for control of the acquiree. Acquisition-related costs are recognized in profit or loss as incurred.
Goodwill is measured as the
excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value
of the acquirer's previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the
identifiable assets acquired and the liabilities assumed. If, after re-assessment, the net of the acquisition-date amounts of the
identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling
interests in the acquiree and the fair value of the acquirer's previously held interest in the acquiree (if any), the excess is
recognized immediately in profit or loss as a bargain purchase gain.
When a business combination
is achieved in stages, the Group's previously held equity interest in the acquiree is remeasured to its acquisition-date fair value
and the resulting gain or loss, if any, is recognized in profit or loss. Amounts arising from interests in the acquiree prior to
the acquisition date that have previously been recognized in other comprehensive income are reclassified to profit or loss where
such treatment would be appropriate if that interest were disposed of.
If the initial accounting for
a business combination is incomplete by the end of the reporting period in which the combination occurs, the Group reports provisional
amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period,
or additional assets or liabilities are recognized, to reflect new information obtained about facts and circumstances that existed
at the acquisition date that, if known, would have affected the amounts recognized at that date.
The Group does not apply the
acquisition method to account for business combinations involving entities under common control.
In preparing the financial
statements of each individual group entity, transactions in currencies other than the entity’s functional currency (foreign
currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At each balance sheet date, monetary
items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair
value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined.
Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Exchange differences on monetary
items arising from settlement or translation are recognized in profit or loss in the period in which they arise.
Exchange differences arising
on the retranslation of non-monetary assets (such as equity instruments) or liabilities measured at fair value are included in
profit or loss for the period at the rates prevailing at the balance sheet date except for exchange differences arising on the
retranslation of non-monetary items in respect of which gains and losses are recognized directly in other comprehensive income,
in which case, the exchange differences are also recognized directly in other comprehensive income.
For the purposes of presenting
the consolidated financial statements, the assets and liabilities of the Group’s foreign operations are translated into New
Taiwan dollars using exchange rates prevailing at each balance sheet date. Income and expense items are translated at the average
exchange rates for the
period. Exchange differences arising are recognized in other comprehensive income and accumulated in equity
attributed to the owners of the Company and non-controlling interests as appropriate.
In relation to a partial disposal
of a subsidiary that includes a foreign operation does not result in the Group losing control over the subsidiary, the proportionate
share of accumulated exchange differences are re-attributed to non-controlling interests of the subsidiary and are not recognized
in profit or loss.
Cash equivalents are short-term,
highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk
of change in value.
| h. | Inventories and Inventories Related to Real Estate Business |
Inventories, including raw
materials (materials received from customers for processing, mainly semiconductor wafers, are excluded from inventories as title
and risk of loss remain with the customers), supplies, work in process, finished goods, and materials and supplies in transit are
stated at the lower of cost or net realizable value. Inventory write-downs are made by item, except for those that may be appropriate
to group items of similar or related inventories. Net realizable value is the estimated selling prices of inventories less all
estimated costs of completion and estimated costs necessary to make the sale. Raw materials and supplies are recorded at moving
average cost while work in process and finished goods are recorded at standard cost.
Inventories related to real
estate business include land and buildings held for sale, land held for construction, construction in progress and prepayment for
land use rights. Land held for development is recorded as land held for construction upon obtaining the title of ownership. The
prepayment is recorded as prepayments for land use rights before obtaining the title of ownership. Prior to the completion, the
borrowing costs directly attributable to construction in progress are capitalized as part of the cost of the asset. Construction
in progress is transferred to land and buildings held for sale upon completion. Land and buildings held for sale, construction
in progress and land held for construction are stated at the lower of cost or net realizable value and related write-downs are
made by item. The amounts received in advance for real estate properties are first recorded as advance receipts and then recognized
as revenue when the construction is completed and the title and significant risk of the real estate properties are transferred
to customers. Cost of sales of land and buildings held for sale are recognized based on the ratio of property sold to the total
property developed.
| i. | Investments Accounted for Using the Equity Method |
Investments accounted for using
the equity method include investments in associates. An associate is an entity over which the Group has significant influence and
that is not a subsidiary. Significant influence is the power to participate in the financial and operating policy decisions of
the investee without having control over those policies.
The operating results as well
as assets and liabilities of associates are incorporated in these consolidated financial statements using the equity method of
accounting. Under the equity method, an investment in an associate is initially recognized at cost and adjusted thereafter to recognize
the Group’s share of the profit or loss and other comprehensive income of the associate. The Group also recognizes the changes
in the Group’s share of equity of associates.
Any excess of the cost of acquisition
over the Group's share of the net fair value of the identifiable assets and liabilities of an associate at the date of acquisition
is recognized as goodwill, which is included within the carrying amount of the investment and is not amortized.
When a group entity transacts
with its associate, unrealized profits and losses resulting from the transactions with the associate are eliminated.
| j. | Property, Plant and Equipment |
Except for land which is stated
at cost, property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment.
Properties in the course of
construction for production, supply or administrative purposes are carried at cost, less any recognized impairment loss. Such properties
are classified to the appropriate categories of property, plant and equipment when completed and ready for intended use. Depreciation
of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use.
Depreciation is recognized
using the straight-line method. The estimated useful lives, residual values and depreciation methods are reviewed at each balance
sheet date, with the effect of any changes in estimate accounted for on a prospective basis. Freehold land is not depreciated.
An item of property, plant
and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of
the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is recognized in
profit or loss.
Goodwill arising from an acquisition
of a business is carried at cost as established at the date of acquisition of the business less accumulated impairment loss, if
any.
Goodwill is not amortized but
is tested for impairment annually, or more frequently when there is an indication that the cash-generating unit may be impaired.
For the purpose of impairment testing, goodwill is allocated to each of the Group’s cash-generating units or groups of cash-generating
units that are expected to benefit from the synergies of business combinations.
If the recoverable amount of
the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount
of any goodwill allocated to the cash-generating unit and then to the other assets of the unit pro rata based on the carrying amount
of each asset in the cash-generating unit. Any impairment loss for goodwill is recognized directly in profit or loss. A reversal
of an impairment loss recognized for goodwill is prohibited in subsequent periods.
| l. | Other Intangible Assets |
Other intangible assets with
finite useful lives acquired separately are initially measured at cost and subsequently measured at cost less accumulated amortization
and accumulated impairment. Other intangible assets are amortized based on the pattern in which the economic benefits are consumed
or using the straight-line method over their estimated useful lives. The estimated useful lives, residual value and amortization
methods are reviewed at each balance sheet date, with the effect of any changes in estimate being accounted for on a prospective
basis.
Other intangible assets acquired
in a business combination and recognized separately from goodwill are initially recognized at their fair value at the acquisition
date. Subsequent to initial recognition, other intangible assets acquired in a business combination are reported at cost less accumulated
amortization and accumulated impairment, on the same basis as intangible assets acquired separately.
| m. | Impairment of Tangible and Intangible Assets Other than Goodwill |
At each balance sheet date,
the Group reviews the carrying amounts of its tangible and intangible assets, excluding goodwill (see above), to determine whether
there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount
of the asset is estimated in order to determine the extent of the impairment loss. Recoverable amount is the higher of fair value
less costs to sell and value in use. If the recoverable amount of an asset or cash-generating
unit is estimated to be less than
its carrying amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable amount.
When an impairment loss is
subsequently reversed, the carrying amount of the asset or cash-generating unit is increased to the revised estimate of its recoverable
amount, but only to the extent of the carrying amount that would have been determined had no impairment loss been recognized for
the asset or cash-generating unit in prior years. A reversal of an impairment loss is recognized immediately in profit or loss.
Financial assets and financial
liabilities are recognized when a group entity becomes a party to the contractual provisions of the instruments. Financial assets
and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition
or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through
profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate,
on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities
at fair value through profit or loss are recognized immediately in profit or loss.
All regular way purchases or
sales of financial assets are recognized or derecognized on a settlement date basis.
The classification of financial
assets held by the Group depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.
| i. | Financial assets at fair value through profit or loss (“FVTPL”) |
Financial assets are classified
as at FVTPL when the financial assets are either held for trading or they are designated as at FVTPL.
A financial asset other than
a financial asset held for trading may be designated as at FVTPL upon initial recognition if:
| ․ | Such designation eliminates or significantly reduces a measurement or recognition inconsistency
that would otherwise arise; or |
| ․ | The financial asset forms part of a group of financial assets or financial liabilities or both,
which is managed and its performance is evaluated on a fair value basis, in accordance with the Group's documented risk management
or investment strategy, and information about the grouping is provided internally on that basis; or |
| ․ | It forms part of a contract containing one or more embedded derivatives, and IAS 39 permits the
entire combined contract to be designated as at FVTPL. |
Financial assets at FVTPL are
stated at fair value with any gains or losses arising on remeasurement recognized in profit or loss. The net gain or loss recognized
in profit or loss incorporates any dividend or interest earned on the financial asset.
| ii. | Available-for-sale financial assets |
Available-for-sale financial
assets are non-derivatives that are either designated as available-for-sale or are not classified as (a) loans and receivables,
(b) held-to-maturity investments or (c) financial assets at fair value through profit or loss.
Available-for-sale financial
assets are stated at fair value at each balance sheet date. Changes in the carrying amount of available-for-sale monetary financial
assets relating to changes in foreign currency rates, interest income calculated using the effective interest method and dividends
on available-for-sale equity investments are recognized in profit or loss. Other changes in the carrying amount of available-for-sale
financial assets are recognized in other comprehensive income and accumulated under the heading of unrealized gain (loss) on available-for-sale
financial assets. When the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously accumulated
in the unrealized gain (loss) on available-for-sale financial assets is reclassified to profit or loss.
Dividends on available-for-sale
equity instruments are recognized in profit or loss when the Group's right to receive the dividends is established.
| iii. | Loans and receivables |
Loans and receivables including
cash and cash equivalents, trade receivables, other receivables, other financial assets and debt investments with no active market
are measured at amortized cost using the effective interest method, less any impairment. Interest income is recognized by applying
the effective interest rate, except for short-term receivables when the effect of discounting is immaterial.
| b) | Impairment of financial assets |
Financial assets, other than
those at FVTPL, are assessed for indicators of impairment at each balance sheet date. Financial assets are considered to be impaired
when there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial
assets, the estimated future cash flows of the investments have been affected.
For financial assets carried
at amortized cost, such as trade receivables and other receivables, assets that are assessed not to be impaired individually are,
further, assessed for impairment on a collective basis. The Group assesses the collectability of receivables based on the Group’s
past experience of collecting payments and observable changes that correlate with default on receivables.
For financial assets carried
at amortized cost, the amount of the impairment loss recognized is the difference between the assets’ carrying amounts and
the present value of estimated future cash flows, discounted at the financial assets’ original effective interest rates.
If, in a subsequent period, the amount of the impairment loss decreases and the decreases can be objectively related to an event
occurring after the impairment loss recognized, the previously recognized impairment loss is reversed either directly or by adjusting
an allowance account through profit or loss. The reversal shall not result in carrying amounts of financial assets that exceed
what the amortized cost would have been at the date the impairment is reversed.
When an available-for-sale financial
asset is considered to be impaired, cumulative gains or losses previously recognized in other comprehensive income are reclassified
to profit or loss in the period. In respect of available-for-sale equity securities, impairment loss previously recognized in profit
or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is recognized in other
comprehensive income and accumulated under the heading of unrealized gain (loss) on available-for-sale financial assets.
| c) | Derecognition of financial assets |
The Group derecognizes a financial
asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially
all the risks and rewards of ownership of the asset to another entity. On derecognition of a financial asset in its entirety, the
difference between the asset’s carrying amount and the sum of the consideration received and receivable and the cumulative
gain or loss that had been recognized in other comprehensive income and accumulated in equity is recognized in profit or loss.
An equity instrument is any
contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments
issued by a group entity are recognized at the proceeds received, net of direct issue costs.
Repurchase of the Company’s
own equity instruments is recognized and deducted directly in equity. No gain or loss is recognized in profit or loss on the purchase,
sale, issue or cancellation of the Company’s own equity instruments.
Financial liabilities are measured
either at amortized cost using the effective interest method or at FVTPL. Financial liabilities measured at FVTPL are held for
trading.
Financial liabilities at FVTPL
are stated at fair value with any gains or losses, including dividends or interest paid, arising on remeasurement recognized in
profit or loss.
The Group derecognizes financial
liabilities when, and only when, the Group’s obligations are discharged, cancelled or they expire. The difference between
the carrying amount of the financial liability derecognized and the consideration paid and payable is recognized in profit or loss.
| 4) | Derivative Financial Instruments |
Derivatives are initially recognized
at fair value at the date the derivative contracts are entered into and are subsequently remeasured to their fair value at each
balance sheet date. The resulting gain or loss is recognized in profit or loss immediately unless the derivative is designated
and effective as a hedging instrument. When the fair value of derivative instruments is positive, they are recognized as financial
assets; when the fair value of derivative instruments is negative, they are recognized as financial liabilities.
Derivatives embedded in non-derivative
host contracts are treated as separate derivatives when they meet the definition of a derivative, their risks and characteristics
are not closely related to those of the host contracts and the contracts are not measured at FVTPL.
Convertible bonds issued by
the Company that contain liability, conversion option, redemption option and put option (collectively the “Bonds Options”)
components are classified separately into respective items on initial recognition. The conversion option that will be settled other
than by the exchange of a fixed amount of cash or other financial asset for a fixed number of the Company’s own equity instruments
is classified as a conversion option derivative. At the date of offering, both the liability and the Bonds Options components are
recognized at fair value.
In subsequent periods, the
liability component of the convertible bonds is measured at amortized cost using the effective interest method. The Bonds Options
are measured at fair value and the changes in fair value are recognized in profit or loss.
Transaction costs that relate
to the offering of the convertible bonds are allocated to the liability and the Bonds Options components in proportion to their
relative fair values. Transaction costs relating to the Bonds Options are recognized immediately in profit or loss. Transaction
costs relating to the liability component are included in the carrying amount of the liability component and amortized using the
effective interest method.
The Group designates certain
hedging instruments as cash flow hedges.
The effective portion of changes
in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized in other comprehensive income
and accumulated under the heading of cash flow hedges. The gain or loss relating to the ineffective portion is recognized immediately
in profit or loss.
Amounts previously recognized
in other comprehensive income and accumulated in equity are reclassified to profit or loss in the periods when the hedged item
affects profit or loss, in the same line as the recognized hedged item.
Hedge accounting is discontinued
prospectively when the Group revokes the designated hedging relationship, or when the hedging instrument expires or is sold, terminated,
or exercised, or when it no longer qualifies for hedge accounting. The cumulative gains or losses on the hedging instruments that
were previously recognized in other comprehensive income from the period when the hedge was effective remains separately in equity
until the forecast transaction occurs. When the forecast transaction is ultimately recognized in profit or loss, the associated
gains or losses that were recognized in other comprehensive income are reclassified from equity to profit or loss or are included
in the initial cost as non-financial assets or non-financial liabilities. When a forecast transaction is no longer expected to
occur, the gain or loss accumulated in equity is recognized immediately in profit or loss.
Revenue is measured at the
fair value of the consideration received or receivable take into account of estimated customer returns, rebates and other similar
allowances.
| 1) | Sale of goods and real estate properties |
Revenue from the sale of goods
and real estate properties is recognized when the goods and real estate properties are delivered and titles have passed, at the
time all the following conditions are satisfied:
| | The Group has transferred to the buyer the significant risks and rewards of ownership of the goods
and real estate properties; |
| | The Group retains neither continuing managerial involvement to the degree usually associated with
ownership nor effective control over the goods and real estate properties sold; |
| | The amount of revenue can be reliably measured; |
| | It is probable that the economic benefits associated with the transaction will flow to the Group;
and |
| | The costs incurred or to be incurred in respect of the transaction can be reliably measured. |
Service income is recognized
when services are rendered.
| 3) | Dividend and interest income |
Dividend income from investments
and interest income from financial assets are recognized when they are probable that the economic benefits will flow to the Group
and the amount of income can be reliably measured. Interest income is accrued on a time basis, by reference to the principal outstanding
and at the effective interest rate applicable.
The Group as lessor
Rental income from operating
leases is recognized on a straight-line basis over the term of the relevant lease.
The Group as lessee
Assets held under finance leases
are initially recognized as assets of the Group at their fair value at the inception of the lease or, if lower, at the present
value of the minimum lease payments. The corresponding liability to the lessor is included in the consolidated balance sheets as
a finance lease obligation.
Operating lease payments are
recognized as expenses on a straight-line basis over the lease term.
Borrowing costs directly attributable
to the acquisition, construction or production of qualifying assets, which are assists that necessarily take a substantial period
of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially
ready for their intended use or sale. All other borrowing costs are recognized in profit or loss in the period in which they are
incurred.
Government grants are not recognized
until there is reasonable assurance that the Group will comply with the conditions attaching to them and that the grants will be
received.
Government grants are recognized
in profit or loss on a systematic basis over the periods in which the Group recognizes as expenses the related costs for which
the grants are intended to compensate. Specifically, government grants whose primary condition is that the Group should purchase,
construct or otherwise acquire non-current assets are recognized as deferred revenue in the consolidated financial statements and
transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets.
Government grants that are
receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to
the Group with no future related costs are recognized in profit or loss in the period in which they become receivable.
Payments to defined contribution
retirement benefit plans are recognized as expenses when employees have rendered services entitling them to the contributions.
Defined benefit costs (including
service cost, net interest and remeasurement) under the defined benefit retirement benefit plans are determined using the projected
unit credit method. Service cost (including current service cost and past service cost) and net interest on the net defined benefit
liability (asset) are recognized as employee benefits expense in the period they occur. Remeasurement, comprising
actuarial gains
and losses and the return on plan assets (excluding interest), is recognized in other comprehensive income in the period in which
they occur. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be
reclassified to profit or loss.
Net defined benefit liability
(asset) represents the actual deficit (surplus) in the Group’s defined benefit plan. Any surplus resulting from this calculation
is limited to the present value of any refunds from the plans or reductions in future contributions to the plans.
Pension cost for an interim
period is calculated on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior year,
adjusted for significant market fluctuations since that time and for significant plan amendments, settlements, or other significant
one-off events
| u. | Share-based Payment Arrangements |
Equity-settled share-based
payments to employees are measured at the fair value of the equity instruments at the grant date. The fair value determined at
the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on
the Group’s best estimate of equity instruments that will eventually vest, with a corresponding increase in capital surplus
- employee share options.
At each balance sheet date,
the Group reviews its estimate of the number of employee share options expected to vest. The impact of the revision of the original
estimates is recognized in profit or loss such that the cumulative expense reflects the revised estimate, with a corresponding
adjustment to the capital surplus - employee share options.
Income tax expense represents
the sum of the tax currently payable and deferred tax.
According to the Income Tax
Law, an additional tax at 10% of unappropriated earnings is provided for as income expense in the year the shareholders approve
the distribution of earnings.
Adjustments of prior years’
tax liabilities are added to or deducted from the current year’s tax provision.
Deferred tax is recognized
on temporary differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the
corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable
temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences, unused loss carry-forward
and unused tax credits for purchases of machinery, equipment and technology, research and development expenditures, and personnel
training expenditures to the extent that it is probable that taxable profits will be available against which those deductible temporary
differences can be utilized.
Deferred tax liabilities are
recognized for taxable temporary differences associated with investments in subsidiaries except where the Group is able to control
the reversal of the temporary differences and it is probable that the temporary differences will not reverse in the foreseeable
future.
The carrying amounts of deferred
tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable
profits will be available to allow all or part of deferred tax assets to be utilized. A previously unrecognized deferred tax asset
is also reviewed at each balance sheet date and recognized to the extent that it has become probable that future taxable profit
will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities
are measured at the tax rates that are expected to apply in the period in which assets are realized or the liabilities are settled.
The measurement of deferred tax assets and liabilities reflects the tax consequences that would follow from the manner in which
the Group expects, at the balance sheet date, to recover or settle the carrying amounts of its assets and liabilities.
| 3) | Current and deferred tax for the year |
Current and deferred tax are
recognized in profit or loss, except when they relate to items that are recognized in other comprehensive income or directly in
equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity, respectively.
Where current tax or deferred
tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business
combination.
Interim period income taxes
are assessed on an annual basis and calculated by applying to an interim period’s pre-tax income the tax rate that would
be applicable to expected total annual earnings.
A translation of the consolidated
financial statements into U.S. dollars is included solely for the convenience of the readers, and has been translated from New
Taiwan dollar (NT$) at the exchange rate as set forth in the statistical release by the U.S. Federal Reserve Board of the United
States, which was NT$31.24 to US$1.00 as of March 31, 2015. The translation should not be construed as a representation that the
NT$ amounts have been, could have been, or could in the future be, converted into U.S. dollars at this or any other rate of exchange.
| 5. | CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY |
In the application of the Group’s
accounting policies, which are described in Note 4, management is required to make judgments, estimates and assumptions about the
carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions
are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying
assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate
is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects
both current and future periods.
Impairment of Goodwill
Determining whether goodwill
is impaired requires an estimation of the value in use of the cash-generating units to which goodwill has been allocated. The value
in use calculation requires management to estimate the future cash flows expected to arise from cash-generating units and suitable
discount rates in order to calculate its present value. When the actual future cash flows are less than expected, a material impairment
loss may arise.
Impairment of Tangible
and Intangible Assets Other than Goodwill
In evaluating the impairment
of tangible and intangible assets other than goodwill, the Group is required to make subjective judgments in determining the independent
cash flows, useful lives, expected future revenue and expenses related to the specific asset groups with the consideration of its
usage patterns and the nature of semiconductor industry. Any changes in these estimates based on changed economic conditions or
business strategies could result in significant impairment charges in future periods.
Valuation of Inventory
Inventories are stated at the
lower of cost or net realizable value and the net realizable value of inventory at balance sheet date is determined based on Group’s
judgments and estimates.
Due to the rapid technology
changes, the Group estimates the net realizable value of inventory for obsolescent and unmarketable items at balance sheet date
and then writes down the cost of inventories to net realizable value. There may be significant changes in the net realizable value
of inventories due to assumptions of future demand within a specific time period.
Income Taxes
The realizability of deferred
tax assets mainly depends on whether sufficient future profits or taxable temporary differences will be available. In cases where
the actual future profits generated are less than expected, a material reversal of deferred tax assets may arise, which would be
recognized in profit or loss for the period in which such a reversal takes place.
Recognition and Measurement
of Defined Benefit Plans
Accrued pension liabilities
and the resulting pension expenses under defined benefit pension plans are calculated using the Projected Unit Credit Method. Actuarial
assumptions comprise discount rates and expected rates of salary increase. Changes in economic circumstances and market conditions
will affect these assumptions and may have a material impact on the amount of the expense and the liability.
Fair value of Derivatives
and Other Financial Instruments
As disclosed in Note 30, the
Group’s management uses its judgments applying appropriate valuation techniques commonly applied by market practitioners.
The assumptions applied are based on observable quoted market prices, foreign exchange rates and interest rates to the extent it
is available. The fair value of unquoted equity instruments is estimated based on the assumptions supported by unobservable market
prices and interest rates which are disclosed in Note 30. The Group’s management believes that the valuation techniques and
the assumptions applied are appropriate in determining the fair value of financial instruments.
| 6. | CASH AND CASH EQUIVALENTS |
| |
March
31, 2014 | |
December
31, 2014 | |
March
31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Cash on hand | |
$ | 10,059 | | |
$ | 9,953 | | |
$ | 10,130 | |
Checking accounts and demand deposits | |
| 35,424,181 | | |
| 43,059,911 | | |
| 40,787,232 | |
Cash equivalent | |
| 8,143,248 | | |
| 8,624,546 | | |
| 8,617,074 | |
| |
| | | |
| | | |
| | |
| |
$ | 43,577,488 | | |
$ | 51,694,410 | | |
$ | 49,414,436 | |
| 7. | FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS |
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
NT$ | |
NT$ | |
NT$ |
| |
| |
| |
|
Financial assets designated as at FVTPL | |
| |
| |
|
| |
| | | |
| | | |
| | |
Structured time deposits | |
$ | 2,313,595 | | |
$ | 2,376,050 | | |
$ | 2,349,660 | |
Private-placement convertible bonds | |
| 100,500 | | |
| 100,500 | | |
| 100,500 | |
| |
| 2,414,095 | | |
| 2,476,550 | | |
| 2,450,160 | |
| |
| | | |
| | | |
| | |
Financial assets held for trading | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
Swap contracts | |
| 715,885 | | |
| 1,907,705 | | |
| 1,313,588 | |
Open-end mutual funds | |
| 170,834 | | |
| 533,425 | | |
| 534,322 | |
Forward exchange contracts | |
| 13,108 | | |
| 27,811 | | |
| 182,200 | |
Quoted shares | |
| 41,178 | | |
| 43,352 | | |
| 37,242 | |
Repurchase agreements collateralized by bonds | |
| — | | |
| — | | |
| 12,779 | |
Cross currency swap contracts | |
| 9,578 | | |
| — | | |
| — | |
Foreign currency option contracts | |
| 1,936 | | |
| — | | |
| — | |
| |
| 952,519 | | |
| 2,512,293 | | |
| 2,080,131 | |
| |
| | | |
| | | |
| | |
| |
$ | 3,366,614 | | |
$ | 4,988,843 | | |
$ | 4,530,291 | |
| |
| | | |
| | | |
| | |
Financial liabilities held for trading | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
Conversion option, redemption option and put option of convertible bonds (Note 19) | |
$ | 2,275,500 | | |
$ | 2,520,606 | | |
$ | 3,456,772 | |
Swap contracts | |
| 66,531 | | |
| 99,165 | | |
| 142,815 | |
Foreign currency option contracts | |
| 28,426 | | |
| — | | |
| 90,692 | |
Forward exchange contracts | |
| 40,066 | | |
| 31,581 | | |
| 11,071 | |
Interest rate swap contracts | |
| 3,418 | | |
| — | | |
| — | |
| |
| | | |
| | | |
| | |
| |
$ | 2,413,941 | | |
$ | 2,651,352 | | |
$ | 3,701,350 | |
The Group entered into investment
portfolios consisting of structured time deposits and private-placement convertible bonds, and all included embedded derivative
instruments which are not closely related to the host contracts. The Group designated the entire contracts as financial assets
at FVTPL on initial recognition.
At each balance sheet date,
the outstanding swap contracts not accounted for hedge accounting were as follows:
|
|
|
|
Notional Amount |
Currency |
|
Maturity Period |
|
(In Thousands) |
|
|
|
|
|
March 31, 2014 |
|
|
|
|
|
|
|
|
|
Sell NT$/Buy US$ |
|
2014.04-2015.03 |
|
NT$28,345,711/US$959,000 |
Sell US$/Buy NT$ |
|
2014.04-2014.05 |
|
US$64,400/NT$1,950,245 |
Sell US$/Buy JPY |
|
2014.05 |
|
US$65,688/JPY6,750,000 |
Sell US$/Buy CNY |
|
2014.06-2014.07 |
|
US$60,000/CNY365,008 |
Sell CNY/Buy US$ |
|
2015.03 |
|
CNY217,288/US$35,000 |
(Continued)
|
|
|
|
Notional Amount |
Currency |
|
Maturity Period |
|
(In Thousands) |
|
|
|
|
|
December 31, 2014 |
|
|
|
|
|
|
|
|
|
Sell NT$/Buy US$ |
|
2015.01-2015.12 |
|
NT$36,199,735/US$1,209,000 |
Sell US$/Buy NT$ |
|
2015.01-2015.02 |
|
US$132,100/NT$4,149,958 |
Sell US$/Buy JPY |
|
2015.01 |
|
US$72,248/JPY8,450,000 |
Sell US$/Buy CNY |
|
2015.01-2015.06 |
|
US$80,000/CNY503,452 |
Sell CNY/Buy US$ |
|
2015.03 |
|
CNY217,288/US$35,000 |
|
|
|
|
|
March 31, 2015 |
|
|
|
|
|
|
|
|
|
Sell NT$/Buy US$ |
|
2015.04-2016.03 |
|
NT$52,333,193/US$1,714,000 |
Sell US$/Buy NT$ |
|
2015.04-2015.05 |
|
US$80,800/NT$2,540,225 |
Sell US$/Buy JPY |
|
2015.04-2015.05 |
|
US$73,524/JPY8,750,000 |
Sell US$/Buy CNY |
|
2015.06-2015.07 |
|
US$80,000/CNY505,012 |
(Concluded)
At each balance sheet date,
the outstanding forward exchange contracts not accounted for hedge accounting were as follow:
|
|
|
|
Notional Amount |
Currency |
|
Maturity Period |
|
(In Thousands) |
|
|
|
|
|
March 31, 2014 |
|
|
|
|
|
|
|
|
|
Sell US$/Buy NT$ |
|
2014.04-2014.06 |
|
US$30,000/NT$917,365 |
Sell US$/Buy CNY |
|
2014.04-2014.10 |
|
US$104,500/CNY638,843 |
Sell US$/Buy MYR |
|
2014.04-2014.05 |
|
US$9,500/MYR31,322 |
Sell US$/Buy SGD |
|
2014.04-2014.05 |
|
US$8,000/SGD10,134 |
Sell US$/Buy JPY |
|
2014.04-2014.05 |
|
US$7,399/JPY756,482 |
|
|
|
|
|
December 31, 2014 |
|
|
|
|
|
|
|
|
|
Sell US$/Buy NT$ |
|
2015.01 |
|
US$14,000/NT$438,434 |
Sell US$/Buy CNY |
|
2015.01-2015.03 |
|
US$127,000/CNY785,683 |
Sell US$/Buy MYR |
|
2015.01-2015.02 |
|
US$6,000/MYR20,860 |
Sell US$/Buy SGD |
|
2015.01-2015.02 |
|
US$11,700/SGD15,211 |
Sell US$/Buy JPY |
|
2015.01-2015.04 |
|
US$18,385/JPY2,177,800 |
|
|
|
|
|
March 31, 2015 |
|
|
|
|
|
|
|
|
|
Sell US$/Buy NT$ |
|
2015.04-2015.06 |
|
US$250,000/NT$7,900,770 |
Sell US$/Buy CNY |
|
2015.04-2015.06 |
|
US$205,684/CNY1,290,079 |
Sell US$/Buy MYR |
|
2015.04-2015.05 |
|
US$9,000/MYR33,067 |
Sell US$/Buy SGD |
|
2015.04-2015.06 |
|
US$10,000/SGD13,605 |
Sell US$/Buy JPY |
|
2015.04-2015.05 |
|
US$12,337/JPY1,495,176 |
Sell NT$/Buy US$ |
|
2015.04 |
|
NTD2,189,550/US$70,000 |
At each balance sheet date,
the outstanding cross currency swap contracts not accounted for hedge accounting were as follows:
Notional Amount
(In Thousands)
|
|
Maturity Period |
|
Range of Interest Rates Paid (%) |
|
Range of Interest Rates Received (%) |
|
|
|
|
|
|
|
March 31, 2014 |
|
|
|
|
|
|
|
|
|
|
|
|
|
NT$598,600/US$20,000 |
|
2014.07 |
|
(0.19) |
|
0.15 |
At each balance sheet date,
the outstanding foreign currency option contracts not accounted for hedge accounting were as follows:
Currency |
|
Maturity Period |
|
(In Thousands) |
|
|
|
|
|
March 31, 2014 |
|
|
|
|
|
|
|
|
|
Sell US$ Put/NT$Call |
|
2016.08 (Note) |
|
US$2,000/NT$58,300 |
Sell US$ Put/NT$Call |
|
2016.09 (Note) |
|
US$2,000/NT$58,200 |
Sell US$ Put/NT$Call |
|
2016.09 (Note) |
|
US$2,000/NT$58,760 |
Buy US$ Call/NT$ Put |
|
2016.08 (Note) |
|
US$1,000/NT$29,150 |
Buy US$ Call/NT$ Put |
|
2016.09 (Note) |
|
US$1,000/NT$29,100 |
Buy US$ Call/NT$ Put |
|
2016.09 (Note) |
|
US$1,000/NT$29,380 |
|
|
|
|
|
March 31, 2015 |
|
|
|
|
|
|
|
|
|
Sell US$ Put/NT$ Call |
|
2017.07 (Note) |
|
US$4,000/NT$123,200 |
Sell US$ Put/NT$ Call |
|
2017.07 (Note) |
|
US$4,000/NT$122,720 |
Sell US$ Put/NT$ Call |
|
2017.07 (Note) |
|
US$4,000/NT$121,400 |
Sell US$ Put/NT$ Call |
|
2017.07 (Note) |
|
US$4,000/NT$120,200 |
Buy US$ Call/NT$ Put |
|
2017.07 (Note) |
|
US$2,000/NT$61,600 |
Buy US$ Call/NT$ Put |
|
2017.07 (Note) |
|
US$2,000/NT$61,360 |
Buy US$ Call/NT$ Put |
|
2017.07 (Note) |
|
US$2,000/NT$60,700 |
Buy US$ Call/NT$ Put |
|
2017.07 (Note) |
|
US$2,000/NT$60,100 |
| | |
| Note: | The contracts will be settled once a month and the counterparty has the right to early terminate
the contracts. The aforementioned outstanding contracts as of March 31, 2014 were all early terminated. |
At each balance sheet date,
the outstanding interest rate swap contracts not accounted for hedge accounting were as follows:
Notional Amount
(In Thousands) |
|
Maturity Period |
|
Range of Interest Rates Paid (%) |
|
Range of Interest Rates Received (%) |
|
|
|
|
|
|
|
March 31, 2014 |
|
|
|
|
|
|
|
|
|
|
|
|
|
CNY240,000 |
|
2015.02 |
|
1.35 |
|
0.89-1.02 |
| 8. | AVAILABLE-FOR-SALE FINANCIAL ASSETS |
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Open-end mutual funds | |
$ | 1,867,557 | | |
$ | 1,500,434 | | |
$ | 949,599 | |
Limited partnership | |
| 594,965 | | |
| 555,361 | | |
| 459,187 | |
Quoted ordinary shares | |
| 343,841 | | |
| 195,070 | | |
| 229,747 | |
Unquoted ordinary shares | |
| 232,664 | | |
| 211,726 | | |
| 214,145 | |
Unquoted preferred shares | |
| 16,971 | | |
| 11,779 | | |
| 12,347 | |
| |
| 3,055,998 | | |
| 2,474,370 | | |
| 1,865,025 | |
Current | |
| 1,922,038 | | |
| 1,533,265 | | |
| 979,247 | |
| |
| | | |
| | | |
| | |
Non-current | |
$ | 1,133,960 | | |
$ | 941,105 | | |
$ | 885,778 | |
| 9. | DERIVATIVE FINANCIAL INSTRUMENTS FOR HEDGING |
The Group entered into interest
rate swap contracts as cash flow hedge to mitigate exposures to future cash flow fluctuations resulting from interest rate changes
relating to the Group’s borrowings.
At each balance sheet date,
the outstanding interest rate swap contracts of the Group were as follows:
Maturity Period |
|
Notional Amount
(In Thousands) |
|
Interest Rates
Paid (%) |
|
Interest Rates Received
(%) |
|
Expected
Period for
Future Cash
Flow |
|
Expected Period for the Recognition
of Gains or Losses from
Hedging |
|
|
|
|
|
|
|
|
|
|
|
March 31, 2014 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014.04 |
|
CNY 240,000 |
|
2.00 |
|
1.34 |
|
2014 |
|
2014 |
All interest rate swap contracts
exchanging floating interest rates for fixed interest rates were designated as cash flow hedges in order to reduce the Group's
cash flow exposure to floating interest rates on borrowings. The interest rate swaps and the interest payments on the borrowings
occur simultaneously and the amounts accumulated in equity are reclassified to profit or loss over the period that the floating
rate interest payments on the borrowings affect profit or loss. (Note 22d)
| 10. | TRADE RECEIVABLES, NET |
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Trade receivables | |
$ | 37,910,360 | | |
$ | 53,004,955 | | |
$ | 43,104,975 | |
Less: Allowance for doubtful debts | |
| 53,533 | | |
| 84,145 | | |
| 95,494 | |
| |
| | | |
| | | |
| | |
Trade receivables, net | |
$ | 37,856,827 | | |
$ | 52,920,810 | | |
$ | 43,009,481 | |
The Group’s average credit
terms were 30 to 90 days. Allowance for doubtful debts is assessed by reference to the collectability of receivables by evaluating
the account aging, historical experience and current financial condition of customers.
As of March 31, 2014, December
31, 2014 and March 31, 2015, except that the Group’s five largest customers accounted for 22%, 30% and 26% of accounts receivable,
respectively, the concentration of credit risk is insignificant for the remaining accounts receivable.
Aging of receivables
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Not past due | |
$ | 34,431,333 | | |
$ | 47,387,888 | | |
$ | 39,470,599 | |
1 to 30 days | |
| 2,784,559 | | |
| 5,222,943 | | |
| 3,217,701 | |
31 to 90 days | |
| 577,812 | | |
| 306,052 | | |
| 289,008 | |
More than 91 days | |
| 116,656 | | |
| 88,072 | | |
| 127,667 | |
| |
| | | |
| | | |
| | |
Total | |
$ | 37,910,360 | | |
$ | 53,004,955 | | |
$ | 43,104,975 | |
The above aging schedule was
based on the past due date.
Aging of receivables that
were past due but not impaired
| |
March
31, 2014 | |
December
31, 2014 | |
March
31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
1 to 30 days | |
$ | 2,740,475 | | |
$ | 5,191,521 | | |
$ | 3,111,186 | |
31 to 90 days | |
| 391,299 | | |
| 131,247 | | |
| 169,952 | |
More than 91 days | |
| — | | |
| 1,407 | | |
| 2,346 | |
| |
| | | |
| | | |
| | |
Total | |
$ | 3,131,774 | | |
$ | 5,324,175 | | |
$ | 3,283,484 | |
The above aging schedule was
based on the past due date.
Except for those impaired,
the Group had not provided an allowance for doubtful debts on trade receivables at each balance sheet date since there has not
been a significant change in credit quality and the amounts were still considered recoverable. The Group did not hold any collateral
or other credit enhancements over these balances nor did it have a legal right to offset against any amounts owed by the Group
to counterparties.
Movement of the allowance
for doubtful trade receivables
| |
Impaired Individually | |
Impaired Collectively | |
Total |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Balance at January 1, 2014 | |
$ | 26,885 | | |
$ | 41,235 | | |
$ | 68,120 | |
Impairment losses reversed | |
| (11,039 | ) | |
| (2,961 | ) | |
| (14,000 | ) |
(Continued)
| |
Impaired Individually | |
Impaired Collectively | |
Total |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Amount written off as uncollectible | |
$ | — | | |
$ | (11 | ) | |
$ | (11 | ) |
Effect of foreign currency exchange differences | |
| (1,233 | ) | |
| 657 | | |
| (576 | ) |
| |
| | | |
| | | |
| | |
Balance at March 31, 2014 | |
$ | 14,613 | | |
$ | 38,920 | | |
$ | 53,533 | |
| |
| | | |
| | | |
| | |
Balance at January 1, 2015 | |
$ | 28,305 | | |
$ | 55,840 | | |
$ | 84,145 | |
Impairment losses recognized | |
| 18,782 | | |
| (6,242 | ) | |
| 12,540 | |
Amount written off as uncollectible | |
| — | | |
| (209 | ) | |
| (209 | ) |
Effect of foreign currency exchange differences | |
| (502 | ) | |
| (480 | ) | |
| (982 | ) |
| |
| | | |
| | | |
| | |
Balance at March 31, 2015 | |
$ | 46,585 | | |
$ | 48,909 | | |
$ | 95,494 | |
(Concluded)
Aging of impaired trade
receivables
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Not past due | |
$ | — | | |
$ | 2,701 | | |
$ | — | |
1 to 30 days | |
| 44,084 | | |
| 31,422 | | |
| 106,515 | |
31 to 90 days | |
| 186,513 | | |
| 174,805 | | |
| 119,056 | |
More than 91 days | |
| 116,656 | | |
| 86,665 | | |
| 125,321 | |
Total | |
$ | 347,253 | | |
$ | 295,593 | | |
$ | 350,892 | |
The above aging schedule was
based on the past due date.
| b. | Transfers of financial assets |
Factored trade receivables
of the Company were as follows:
Counterparties | |
Receivables Sold (In Thousands) | |
Amounts Collected (In Thousands) | |
Advances Received At Period-end (In Thousands) | |
| Interest Rates on Advances Received (%) | | |
Credit Line (In Thousands) |
| |
| |
| |
| |
| | | |
|
For the three months ended March 31, 2014 | |
| |
| |
| |
| | | |
|
Citi bank | |
US$ 49,147 | |
US$ - | |
US$ 49,147 | |
| 1.09 | | |
US$ 92,000 |
| |
| |
| |
| |
| | | |
|
For the three months ended March 31, 2015 | |
| |
| |
| |
| | | |
|
Citi bank | |
US$ - | |
US$ - | |
US$ - | |
| — | | |
US$ 92,000 |
Pursuant to the factoring agreement,
losses from commercial disputes (such as sales returns and discounts) should be borne by the Company, while losses from credit
risk should be borne by the banks. In the commencement of the factoring agreement in 2010, the Company also issued promissory notes
to the banks for commercial disputes which remained undrawn since. The promissory notes amounted to
US$27,000 thousand, US$5,000
thousand and US$5,000 thousand as of March 31, 2014, December 31, 2014 and March 31, 2015, respectively. There were no significant
losses from commercial disputes in the past and the Group does not expect any significant commercial dispute losses in the foreseeable
future.
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Finished goods | |
$ | 3,911,581 | | |
$ | 6,568,459 | | |
$ | 7,606,145 | |
Work in process | |
| 2,410,352 | | |
| 2,064,377 | | |
| 4,236,873 | |
Raw materials | |
| 8,189,302 | | |
| 10,155,006 | | |
| 9,775,154 | |
Supplies | |
| 591,116 | | |
| 797,353 | | |
| 753,171 | |
Raw materials and supplies in transit | |
| 392,864 | | |
| 577,898 | | |
| 1,079,156 | |
| |
| | | |
| | | |
| | |
| |
$ | 15,495,215 | | |
$ | 20,163,093 | | |
$ | 23,450,499 | |
The cost of inventories recognized
as operating costs for the three months ended March 31, 2014 and 2015 were NT$44,296,028 thousand and NT$52,348,719 thousand, respectively,
which included write-down of inventories at NT$38,404 thousand and reversal of write-down of inventories at NT$216,787 thousand,
respectively. Previous write-downs were reversed as a result of selling of inventories.
| 12. | INVENTORIES RELATED TO REAL ESTATE BUSINESS |
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Land and buildings held for sale | |
$ | 5,322 | | |
$ | 5,558 | | |
$ | 5,475 | |
Construction in progress (Note 17) | |
| 15,820,564 | | |
| 22,242,065 | | |
| 22,397,694 | |
Land held for construction | |
| 1,692,764 | | |
| 1,738,855 | | |
| 1,751,428 | |
Prepayments for land use rights | |
| 3,255,304 | | |
| — | | |
| — | |
| |
| | | |
| | | |
| | |
| |
$ | 20,773,954 | | |
$ | 23,986,478 | | |
$ | 24,154,597 | |
Land and buildings held for
sale located in Shanghai Zhangjiang was successively completed and sold. Construction in progress is mainly located on Caobao Road
and Hutai Road in Shanghai, China and Lidu Road and Xinhong Road in Kun Shan, China. The capitalized borrowing costs for the three
months ended March 31, 2014 and 2015 is disclosed in Note 23.
As of March 31, 2014, December
31, 2014 and March 31, 2015, inventories related to real estate business of NT$20,768,632 thousand, NT$23,697,339 thousand and
NT$23,845,869 thousand, respectively, are expected to be recovered longer than twelve months.
Refer to Note 32 for the carrying
amount of inventories related to real estate business that had been pledged by the Group to secure bank borrowings.
| 13. | INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD |
Investments in associates accounted
for using the equity method consisted of the following:
| |
| |
| |
| Carrying Amount | | |
| |
Main | |
Establish- ment and Operating | |
| March 31, 2014 | | |
| December 31, 2014 | | |
| March 31, 2015 | |
Name of Associate | |
Business | |
Location | |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| |
| |
| | | |
| | | |
| | |
Listed companies | |
| |
| |
| | | |
| | | |
| | |
Hung Ching Development & Construction Co. (“HC”) | |
Engaged in the development, construction and leasing of real estate properties | |
ROC | |
$ | 1,306,830 | | |
$ | 1,351,400 | | |
$ | 1,461,631 | |
Advanced Microelectronic Products Inc. (“AMPI”) | |
Engaged in integrated circuit | |
ROC | |
| 115,917 | | |
| 99,052 | | |
| 86,953 | |
Unlisted companies | |
| |
| |
| | | |
| | | |
| | |
Hung Ching Kwan Co. (“HCK”) | |
Engaged in the leasing of real estate properties | |
ROC | |
| 352,100 | | |
| 342,138 | | |
| 340,796 | |
StarChips Technology Inc. (“SCT”) | |
Engaged in design, manufacturing and sale of LED driver IC | |
ROC | |
| 47,856 | | |
| — | | |
| — | |
| |
| |
| |
| 1,822,703 | | |
| 1,792,590 | | |
| 1,899,380 | |
| |
Less: Deferred gain on transfer of land | |
| |
| 300,149 | | |
| 300,149 | | |
| 300,149 | |
| |
Accumulated impairment - SCT | |
| |
| 47,856 | | |
| — | | |
| — | |
| |
| |
| |
| | | |
| | | |
| | |
| |
| |
| |
$ | 1,474,698 | | |
$ | 1,492,441 | | |
$ | 1,589,231 | |
| a. | At each balance sheet date, the percentages of ownership held by the Group were as follows: |
|
|
March 31,
2014 |
|
December 31,
2014 |
|
March 31,
2015 |
|
|
|
|
|
|
|
HC |
|
26.2% |
|
26.2% |
|
26.2% |
AMPI |
|
22.1% |
|
18.2% |
|
18.2% |
HCK |
|
27.3% |
|
27.3% |
|
27.3% |
SCT |
|
33.3% |
|
- |
|
- |
| | |
| b. | In January 2014, the Company subscribed for 20,000 thousand private-placement ordinary shares of
AMPI in NT$100,000 thousand. The Company obtained significant influence over AMPI since the percentage of ownership was 27.4% after
taking into account the shares previously held and recognized as available-for-sale financial assets. The private-placement ordinary
shares were restricted for disposal during a 3-year lock-up period. In addition, the Company did not join AMPI’s cash capital
increase in February and April 2014 and, as the result, the percentage of ownership decreased from 27.4% to 18.2%. After the consideration
of potential voting rights that are currently convertible, the Company still has significant influence over AMPI. |
| c. | The Company did not subscribe for SCT’s cash capital increase in May 2014 and, therefore,
the percentage of ownership decreased from 33.3% to 5.6%. As the result, the Company had no significant influence over SCT and
the investment in SCT was reclassified to available-for-sale financial assets. |
| d. | Fair values (Level 1) of investments in associates with available published price quotation are
summarized as follows: |
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| | | |
| NT$ | | |
| NT$ | | |
| NT$ | |
| | | |
| | | |
| | | |
| | |
| HC | | |
$ | 1,180,432 | | |
$ | 1,427,499 | | |
$ | 1,564,759 | |
| AMPI | | |
$ | 329,088 | | |
$ | 184,862 | | |
$ | 146,557 | |
| 14. | PROPERTY, PLANT AND EQUIPMENT |
The carrying amounts of each
class of property, plant and equipment were as follows:
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Land | |
$ | 3,314,594 | | |
$ | 3,348,018 | | |
$ | 3,338,104 | |
Buildings and improvements | |
| 44,761,670 | | |
| 56,395,710 | | |
| 56,117,941 | |
Machinery and equipment | |
| 72,471,991 | | |
| 84,171,647 | | |
| 81,828,123 | |
Other equipment | |
| 1,357,717 | | |
| 1,816,687 | | |
| 1,694,371 | |
Construction in progress and machinery in transit | |
| 8,516,407 | | |
| 5,855,053 | | |
| 7,076,830 | |
| |
| | | |
| | | |
| | |
| |
$ | 130,422,379 | | |
$ | 151,587,115 | | |
$ | 150,055,369 | |
For the three months ended
March 31, 2014
| |
Land | |
Buildings and improvements | |
Machinery and equipment | |
Other equipment | |
Construction in progress and machinery in transit | |
Total |
| |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ |
| |
| |
| |
| |
| |
| |
|
Cost | |
| |
| |
| |
| |
| |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at January 1, 2014 | |
$ | 3,295,758 | | |
$ | 70,593,537 | | |
$ | 208,351,905 | | |
$ | 6,384,589 | | |
$ | 7,009,702 | | |
$ | 295,635,491 | |
Additions | |
| — | | |
| 575,923 | | |
| 1,587,144 | | |
| 68,493 | | |
| 2,296,507 | | |
| 4,528,067 | |
Disposals | |
| — | | |
| (36,406 | ) | |
| (2,287,869 | ) | |
| (178,424 | ) | |
| (3,810 | ) | |
| (2,506,509 | ) |
Reclassification | |
| — | | |
| 37,844 | | |
| 626,158 | | |
| 35,199 | | |
| (730,255 | ) | |
| (31,054 | ) |
Effect of foreign currency exchange differences | |
| 18,836 | | |
| 529,369 | | |
| 1,629,929 | | |
| 131,181 | | |
| (35,473 | ) | |
| 2,273,842 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at March 31, 2014 | |
$ | 3,314,594 | | |
$ | 71,700,267 | | |
$ | 209,907,267 | | |
$ | 6,441,038 | | |
$ | 8.536.671 | | |
$ | 299,899,837 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Accumulated depreciation and impairment | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at January 1, 2014 | |
$ | — | | |
$ | 25,826,936 | | |
$ | 133,266,723 | | |
$ | 5,044,501 | | |
$ | — | | |
$ | 164,138,160 | |
Depreciation expense | |
| — | | |
| 951,171 | | |
| 5,175,028 | | |
| 143,757 | | |
| — | | |
| 6,269,956 | |
Impairment losses recognized | |
| — | | |
| — | | |
| — | | |
| — | | |
| 20,264 | | |
| 20,264 | |
Disposals | |
| — | | |
| (34,112 | ) | |
| (2,076,247 | ) | |
| (177,003 | ) | |
| — | | |
| (2,287,362 | ) |
Effect of foreign currency exchange differences | |
| — | | |
| 194,602 | | |
| 1,069,772 | | |
| 72,066 | | |
| — | | |
| 1,336,440 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at March 31, 2014 | |
$ | — | | |
$ | 26,938,597 | | |
$ | 137,435,276 | | |
$ | 5,083,321 | | |
$ | 20,264 | | |
$ | 169,477,458 | |
For the three months ended
March 31, 2015
| |
Land | |
Buildings and improvements | |
Machinery and equipment | |
Other equipment | |
Construction in progress and machinery in transit | |
Total |
| |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ |
| |
| |
| |
| |
| |
| |
|
Cost | |
| |
| |
| |
| |
| |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at January 1,2015 | |
$ | 3,348,018 | | |
$ | 86,725,254 | | |
$ | 233,669,627 | | |
$ | 7,182,574 | | |
$ | 5,862,217 | | |
$ | 336,787,690 | |
Additions | |
| — | | |
| 39,119 | | |
| 161,210 | | |
| 28,418 | | |
| 6,242,723 | | |
| 6,471,470 | |
Disposals | |
| — | | |
| (52,234 | ) | |
| (1,203,060 | ) | |
| (63,361 | ) | |
| (2,959 | ) | |
| (1,321,614 | ) |
Reclassification | |
| — | | |
| 1,243,898 | | |
| 3,903,169 | | |
| 60,746 | | |
| (5,207,813 | ) | |
| — | |
Effect of foreign currency exchange differences | |
| (9,914 | ) | |
| (668,696 | ) | |
| (1,654,216 | ) | |
| (73,924 | ) | |
| 189,816 | | |
| (2,216,934 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at March 31,2015 | |
$ | 3,338,104 | | |
$ | 87,287,341 | | |
$ | 234,876,730 | | |
$ | 7,134,453 | | |
$ | 7,083,984 | | |
$ | 339,720,612 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
(Continued)
| |
Land | |
Buildings and improvements | |
Machinery and equipment | |
Other equipment | |
Construction in progress and machinery in
transit | |
Total |
| |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ |
| |
| |
| |
| |
| |
| |
|
Accumulated depreciation and impairment | |
| |
| |
| |
| |
| |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at January 1,2015 | |
$ | — | | |
$ | 30,329,544 | | |
$ | 149,497,980 | | |
$ | 5,365,887 | | |
$ | 7,164 | | |
$ | 185,200,575 | |
Depreciation expense | |
| — | | |
| 1,160,993 | | |
| 5,901,740 | | |
| 194,265 | | |
| — | | |
| 7,256,998 | |
Disposals | |
| — | | |
| (51,850 | ) | |
| (1,198,116 | ) | |
| (60,920 | ) | |
| — | | |
| (1,310,886 | ) |
Effect of foreign currency exchange differences | |
| — | | |
| (269,287 | ) | |
| (1,152,997 | ) | |
| (59,150 | ) | |
| (10 | ) | |
| (1,481,444 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at March 31,2015 | |
$ | — | | |
$ | 31,169,400 | | |
$ | 153,048,607 | | |
$ | 5,440,082 | | |
$ | 7,154 | | |
$ | 189,665,243 | |
(Concluded)
A portion of property, plant
and equipment was unable to be used for the Group’s production due to production demand and the Group recognized an impairment
loss of NT$20,264 thousand under the line item of other losses in the consolidated statements of comprehensive income for the three
months ended March 31, 2014.
Each class of property, plant
and equipment was depreciated on a straight-line basis over the following useful lives:
Buildings and improvements |
|
|
|
|
Main plant buildings |
|
|
|
10-40 years |
Cleanrooms |
|
|
|
10-20 years |
Others |
|
|
|
3-20 years |
Machinery and equipment |
|
|
|
2-10 years |
Other equipment |
|
|
|
2-20 years |
The capitalized borrowing costs
for the three months ended March 31, 2014 and 2015 are disclosed in Note 23.
Refer to Note 32 for the carrying
amount of property, plant and equipment that had been pledged by the Group to secure bank borrowings.
| |
2014 | |
2015 |
| |
NT$ | |
NT$ |
| |
| |
|
Cost | |
| |
|
| |
| | | |
| | |
Balance at January 1 | |
$ | 12,336,816 | | |
$ | 12,434,411 | |
Effect of foreign currency exchange differences | |
| 35,042 | | |
| (18,594 | ) |
| |
| | | |
| | |
Balance at March 31 | |
$ | 12,371,858 | | |
$ | 12,415,817 | |
| |
| | | |
| | |
Accumulated impairment | |
| | | |
| | |
| |
| | | |
| | |
Balance at January 1 and March 31 | |
$ | (1,988,996 | ) | |
$ | (1,988,996 | ) |
| 16. | OTHER INTANGIBLE ASSETS |
The carrying amounts of each
class of other intangible assets were as follows:
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Patents | |
$ | 23,143 | | |
$ | 15,768 | | |
$ | 15,550 | |
Acquired specific technology | |
| 67,784 | | |
| 5,116 | | |
| — | |
Customer relationships | |
| 621,056 | | |
| 501,501 | | |
| 452,530 | |
Computer software and others | |
| 851,601 | | |
| 945,486 | | |
| 1,019,596 | |
| |
| | | |
| | | |
| | |
| |
$ | 1,563,584 | | |
$ | 1,467,871 | | |
$ | 1,487,676 | |
For the three months ended
March 31, 2014
| |
Patents | |
Acquired Specific Technology | |
Customer Relationships | |
Computer Software and Others | |
Total |
| |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ |
Cost | |
| |
| |
| |
| |
|
| |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at January 1, 2014 | |
$ | 1,021,750 | | |
$ | 1,113,947 | | |
$ | 1,579,015 | | |
$ | 3,848,793 | | |
$ | 7,563,505 | |
Additions | |
| — | | |
| — | | |
| — | | |
| 88,151 | | |
| 88,151 | |
Disposals | |
| — | | |
| — | | |
| — | | |
| (5 | ) | |
| (5 | ) |
Reclassification | |
| — | | |
| — | | |
| — | | |
| (95 | ) | |
| (95 | ) |
Effect of foreign currency exchange differences | |
| 788 | | |
| — | | |
| — | | |
| 21,942 | | |
| 22,730 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at March 31, 2014 | |
$ | 1,022,538 | | |
$ | 1,113,947 | | |
$ | 1,579,015 | | |
$ | 3,958,786 | | |
$ | 7,674,286 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Accumulated amortization | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at January 1, 2014 | |
$ | 985,999 | | |
$ | 1,025,273 | | |
$ | 924,194 | | |
$ | 3,022,215 | | |
$ | 5,957,681 | |
Amortization expense | |
| 13,116 | | |
| 20,890 | | |
| 33,765 | | |
| 67,500 | | |
| 135,271 | |
Disposals | |
| — | | |
| — | | |
| — | | |
| (1 | ) | |
| (1 | ) |
Reclassification | |
| — | | |
| — | | |
| — | | |
| 2,516 | | |
| 2,516 | |
Effect of foreign currency exchange differences | |
| 280 | | |
| — | | |
| — | | |
| 14,955 | | |
| 15,235 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at March 31, 2014 | |
$ | 999,395 | | |
$ | 1,046,163 | | |
$ | 957,959 | | |
$ | 3,107,185 | | |
$ | 6,110,702 | |
For the three months ended
March 31, 2015
| |
Patents | |
Acquired Specific Technology | |
Customer Relationships | |
Computer Software and Others | |
Total |
| |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ |
Cost | |
| |
| |
| |
| |
|
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Balance at January 1, 2015 | | |
$ | 1,025,191 | | |
$ | 1,113,947 | | |
$ | 1,579,015 | | |
$ | 3,067,341 | | |
$ | 6,785,494 | |
| Additions | | |
| 209 | | |
| — | | |
| — | | |
| 162,766 | | |
| 162,975 | |
(Continued)
| |
Patents | |
Acquired Specific Technology | |
Customer Relationships | |
Computer Software and Others | |
Total |
| |
| NT$ | | |
| NT$ | | |
| NT$ | | |
| NT$ | | |
| NT$ | |
Disposals | |
$ | (30 | ) | |
$ | — | | |
$ | — | | |
$ | (1,177 | ) | |
$ | (1,207 | ) |
Effect of foreign currency exchange differences | |
| (921 | ) | |
| — | | |
| — | | |
| (29,557 | ) | |
| (30,478 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at March 31, 2015 | |
$ | 1,024,449 | | |
$ | 1,113,947 | | |
$ | 1,579,015 | | |
$ | 3,199,373 | | |
$ | 6,916,784 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Accumulated amortization | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at January 1, 2015 | |
$ | 1,009,423 | | |
$ | 1,108,831 | | |
$ | 1,077,514 | | |
$ | 2,121,855 | | |
$ | 5,317,623 | |
Amortization expense | |
| 1,134 | | |
| 5,116 | | |
| 48,971 | | |
| 80,607 | | |
| 135,828 | |
Disposals | |
| (30 | ) | |
| — | | |
| — | | |
| (1,177 | ) | |
| (1,207 | ) |
Effect of foreign currency exchange differences | |
| (1,628 | ) | |
| — | | |
| — | | |
| (21,508 | ) | |
| (23,136 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at March 31, 2015 | |
$ | 1,008,899 | | |
$ | 1,113,947 | | |
$ | 1,126,485 | | |
$ | 2,179,777 | | |
$ | 5,429,108 | |
(Concluded)
Each class of other intangible
assets, except a portion of customer relationships amortized based on the pattern in which the economic benefits are consumed,
were amortized on the straight-line basis over the following useful lives:
Patents |
|
|
|
5-15 years |
Acquired specific technology |
|
|
|
5 years |
Customer relationships |
|
|
|
11 years |
Computer software and others |
|
|
|
2-32 years |
|
|
|
|
|
| 17. | LONG-TERM PREPAYMENTS FOR LEASE |
Long-term prepayments for lease
mainly represent land use right located in China with periods for use from 50 to 60 years. As of March 31, 2014, December 31, 2014
and March 31, 2015, the carrying amount of the land use right which the Group was in the process of obtaining the certificates
was NT$18,408 thousand, NT$17,594 thousand and nil, respectively. During January 1, 2014 to March 31, 2014, the land use right
located in China which the Group obtained the certificates was reclassified from long-term prepayments for lease to construction
in progress under inventories related to real estate business.
Short-term borrowings mainly
represented unsecured revolving bank loans with annual interest rates at 0.77%-6.16%, 0.81%-6.00% and 0.63%-5.60% as of March 31,
2014, December 31, 2014 and March 31, 2015, respectively.
As of March 31, 2014, December
31, 2014 and March 31, 2015, the long-term borrowings with fixed interest rates were NT$721,313 thousand, NT$1,192,975 thousand
and NT$115,147 thousand, respectively, with annual interest rates at 2.50%-6.15%, 1.10%-6.15% and 6.15%, respectively. The fixed
interest rate long-term borrowings will be repayable through May 2015. As of March 31, 2014,
December 31, 2014 and March 31, 2015,
the current portion of long-term borrowings with fixed interest rates were nil, NT$116,876 thousand and NT$115,147 thousand, respectively.
The others were floating interest rate borrowings and consisted of the followings:
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Working capital bank loans | |
| | | |
| | | |
| | |
Syndicated bank loans - repayable through April 2015 to July 2018, annual interest rates were 0.88%-2.32%, 0.90%-1.83% and 1.33 %-1.84% as of March 31, 2014, December 31, 2014 and March 31, 2015, respectively | |
$ | 12,335,100 | | |
$ | 10,760,548 | | |
$ | 11,602,910 | |
Others - repayable through June 2016 to August 2019, annual interest rates were 1.04%-5.32% 1.03%-3.74% and 0.94%-3.77% as of March 31, 2014, December 31, 2014 and March 31, 2015, respectively | |
| 20,355,102 | | |
| 12,479,650 | | |
| 11,709,200 | |
Mortgage loans | |
| | | |
| | | |
| | |
Repayable through December 2015 to June 2023, annual interest rates were 1.40%-7.20%, 6.77% and 6.49%-6.77% as of March 31, 2014, December 31, 2014 and March 31, 2015, respectively | |
| 683,167 | | |
| 2,534,483 | | |
| 2,496,988 | |
| |
| 33,373,369 | | |
| 25,774,681 | | |
| 25,809,098 | |
Less: unamortized arrangement fee | |
| 53,105 | | |
| 32,225 | | |
| 26,991 | |
| |
| 33,320,264 | | |
| 25,742,456 | | |
| 25,782,107 | |
Less: current portion | |
| 5,032,977 | | |
| 2,714,131 | | |
| 1,032,087 | |
| |
| | | |
| | | |
| | |
Long-term borrowings | |
$ | 28,287,287 | | |
$ | 23,028,325 | | |
$ | 24,750,020 | |
Pursuant to the above loan
agreements, the Group should maintain certain financial covenants including current ratio, leverage ratio, tangible net assets
and interest coverage ratio. Such financial ratios are calculated based on the Group’s annual audited consolidated financial
statements or semi-annual reviewed consolidated financial statements or subsidiaries’ annual audited financial statements
under local GAAP. As of December 31, 2014, the Group was in compliance with all of the loan covenants.
The Group had sufficient long
term credit facility obtained before March 31, 2014 to refinance some portion of the loans on a long-term basis. Therefore, NT$3,117,943
thousand were not classified as current portion of long-term borrowings as of March 31, 2014.
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Secured domestic bonds - secured by banks | |
| | | |
| | | |
| | |
Repayable at maturity in August 2016 and interest due annually with annual interest rate 1.45% | |
$ | 8,000,000 | | |
$ | 8,000,000 | | |
$ | 8,000,000 | |
(Continued)
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Unsecured convertible overseas bonds | |
$ | 12,188,000 | | |
$ | 12,660,000 | | |
$ | 12,520,000 | |
Secured overseas bonds - secured by the Company | |
| | | |
| | | |
| | |
US$300,000 thousand, repayable at maturity in July 2017; interest due semi-annually with annual interest rate 2.125% | |
| — | | |
| 9,495,000 | | |
| 9,390,000 | |
CNY500,000 thousand, repayable at maturity in September 2016 and interest due semi-annually with annual interest rate 4.25% | |
| 2,476,390 | | |
| 2,586,207 | | |
| 2,547,947 | |
CNY150,000 thousand, repaid in September 2014 with annual interest rate 3.13% | |
| 742,917 | | |
| — | | |
| — | |
| |
| 23,407,307 | | |
| 32,741,207 | | |
| 32,457,947 | |
Less: Discounts on bonds payable | |
| 1,689,861 | | |
| 1,471,076 | | |
| 1,365,292 | |
| |
| 21,717,446 | | |
| 31,270,131 | | |
| 31,092,655 | |
Less: Current portion | |
| 741,695 | | |
| — | | |
| — | |
| |
| | | |
| | | |
| | |
| |
$ | 20,975,751 | | |
$ | 31,270,131 | | |
$ | 31,092,655 | |
In September 2013, the Company
offered the third unsecured convertible overseas bonds (the “Bonds”) in US$400,000 thousand. The Bonds is zero coupon
bonds with the maturity of 5 years, in denominations of US$200 thousand or in any integral multiples thereof. Each holder of the
Bonds has the right at any time on or after October 16, 2013 and up to (and including) August 26, 2018, except during legal lock-up
period, to convert Bonds into newly issued listed common shares at the conversion price NT$33.085, determined on the basis of a
fixed exchange rate of US$1 to NT$29.956. The conversion price will be adjusted in accordance with the conversion provisions due
to anti-dilution clause. As of March 31, 2015, the conversion price was adjusted to NT$31.93.
The Bonds may be redeemed at
the option of the Company, in whole or in part, at any time on or after the third anniversary of the offering date provided that
(1) the closing price, translated into U.S. dollars, of the common shares for a period of 20 consecutive trading days is at least
130% of the conversion price, (2) at least 90% in aggregate principal amount of the Bonds originally outstanding has been redeemed,
repurchased and canceled or converted, or (3) the Company is required to pay additional taxes on the Bonds as a result of certain
changes in tax laws in the ROC.
Each holder shall have the
right to request the Company repurchase all or any portion of the principal amount thereof of a holder’s Bonds (1) on or
after the third anniversary of the offering date, (2) in the event of a change of control, or (3) in the event of delisting.
The Bonds contained a debt
host contract, recognized as bonds payable, and the Bonds Options aggregately recognized as financial liabilities at FVTPL. The
effective interest rate of the debt host contract was 3.16% and the aggregate fair value of the Bonds Options was NT$1,667,950
thousand on initial recognition.
To focus on corporate sustainability
and to carry out the commitment to environmental protection and energy conservation, Anstock II Limited, a subsidiary the Company
100% owned, offered overseas bonds in US$300,000 thousand with the maturity of 3 years and annual interest rate of 2.125% (the
“Green Bonds”) in July 2014. The Green Bonds are unconditionally and irrevocably guaranteed by the Company and the
proceeds will be used to fund certain eligible projects to promote the Group's transition to low-carbon and climate resilient growth.
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Payables for property, plant and equipment | |
$ | 4,204,888 | | |
$ | 7,097,129 | | |
$ | 6,117,364 | |
Accrued salary and bonus | |
| 4,120,201 | | |
| 5,550,040 | | |
| 4,862,833 | |
Accrued bonus to employees and remuneration to directors and supervisors | |
| 2,158,184 | | |
| 2,602,796 | | |
| 3,099,005 | |
Accrued legal settlement fee | |
| 365,640 | | |
| 814,185 | | |
| — | |
Accrued employee insurance | |
| 477,012 | | |
| 572,259 | | |
| 583,458 | |
Accrued utilities | |
| 450,767 | | |
| 495,404 | | |
| 445,851 | |
Others | |
| 4,063,679 | | |
| 5,232,703 | | |
| 4,826,717 | |
| |
| | | |
| | | |
| | |
| |
$ | 15,840,371 | | |
$ | 22,364,516 | | |
$ | 19,935,228 | |
| 21. | RETIREMENT BENEFIT PLANS |
The Group’s pension plans
consisted of defined contribution retirement plan and defined benefit retirement plan. Employee benefit expenses in respect of
the Group’s defined benefit retirement plans were calculated using the projected pension cost stated in 2013 and 2014 actuarial
reports and recognized in the following line items in respective periods:
| |
2014 (Reviewed after Adjusted) | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Operating cost | |
$ | 79,491 | | |
$ | 80,980 | |
Selling and marketing expenses | |
| 2,424 | | |
| 2,568 | |
General and administrative expenses | |
| 14,685 | | |
| 11,735 | |
Research and development expenses | |
| 8,258 | | |
| 9,596 | |
| |
| | | |
| | |
| |
$ | 104,858 | | |
$ | 104,879 | |
Ordinary shares
| |
| March 31, 2014 | | |
| December 31, 2014 | | |
| March 31, 2015 | |
| |
| | | |
| | | |
| | |
Numbers of shares authorized (in thousands) | |
| 9,600,000 | | |
| 10,000,000 | | |
| 10,000,000 | |
| |
| | | |
| | | |
| | |
Numbers of shares reserved (in thousands) | |
| | | |
| | | |
| | |
Employee share options | |
| 800,000 | | |
| 800,000 | | |
| 800,000 | |
| |
| | | |
| | | |
| | |
(Continued)
| |
| March 31, 2014 | | |
| December 31, 2014 | | |
| March 31, 2015 | |
| |
| | | |
| | | |
| | |
Numbers of shares registered (in thousands) | |
| 7,787,160 | | |
| 7,852,538 | | |
| 7,860,492 | |
Numbers of shares subscribed in advance (in thousands) | |
| 25,816 | | |
| 9,178 | | |
| 28,451 | |
| |
| | | |
| | | |
| | |
Number of shares issued and fully paid (in thousands) | |
| 7,812,976 | | |
| 7,816,725 | | |
| 7,888,943 | |
(Concluded)
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Shares authorized | |
$ | 96,000,000 | | |
$ | 100,000,000 | | |
$ | 100,000,000 | |
| |
| | | |
| | | |
| | |
Shares reserved | |
| | | |
| | | |
| | |
Employee share options | |
$ | 8,000,000 | | |
$ | 8,000,000 | | |
$ | 8,000,000 | |
| |
| | | |
| | | |
| | |
Shares registered | |
$ | 77,871,596 | | |
$ | 78,525,378 | | |
$ | 78,604,915 | |
Shares subscribed in advance | |
| 465,527 | | |
| 189,801 | | |
| 583,035 | |
| |
| | | |
| | | |
| | |
Shares issued | |
$ | 78,337,123 | | |
$ | 78,715,179 | | |
$ | 79,187,950 | |
The holders of issued ordinary
shares with a par value at $10 per share are entitled the right to vote and receive dividends, except the shares held by the Group’s
subsidiaries which are not entitled the right to vote. As of March 31, 2014, December 31, 2014 and March 31, 2015, there were 100,000
thousand, 500,000 thousand and 500,000 thousand ordinary shares, respectively, included in the authorized shares were not required
to complete the share registration process.
American Depositary Receipts
The Company issued ADSs and
each ADS represents five ordinary shares. As of March 31, 2014, December 31, 2014 and March 31, 2015, 102,578 thousand, 125,731
thousand and 125,731 thousand ADSs were outstanding and represented approximately 512,892 thousand, 628,657 thousand and 628,657
thousand ordinary shares of the Company, respectively.
| |
March 31, 2014 (Reviewed after Adjusted) | |
December 31, 2014 (Audited after Adjusted) | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Arising from changes in percentage of ownership interest in subsidiaries | |
$ | 2,177,229 | | |
$ | 9,054,328 | | |
$ | 9,054,328 | |
Arising from issuance of ordinary shares | |
| 4,518,813 | | |
| 5,325,382 | | |
| 5,438,357 | |
Arising from employee share options | |
| 1,302,208 | | |
| 1,178,210 | | |
| 1,146,346 | |
Arising from treasury share transactions | |
| 236,214 | | |
| 425,004 | | |
| 425,004 | |
Arising from share of changes in capital surplus of associates | |
| 8,862 | | |
| 30,134 | | |
| 30,134 | |
| |
| | | |
| | | |
| | |
| |
$ | 8,243,326 | | |
$ | 16,013,058 | | |
$ | 16,094,169 | |
The premium from ordinary shares
issued in excess of par, including the premium from issuance of ordinary shares, treasury share transactions and carrying amount
of expired options, may be used to offset deficits; in addition, when the Company has no deficit, such capital surplus may be distributed
as cash dividends or transferred to capital up to a certain percentage of the Company’s capital surplus each year.
The capital surplus arising
from investments accounted for using the equity method and employee share options may not be used for any purpose.
| c. | Retained earnings and dividend policy |
The Articles of Incorporation
of ASE Inc. (the “Articles”) provides that annual net income shall be distributed in the following order:
| 1) | Replenishment of deficits; |
| 2) | 10.0% as legal reserve; |
| 3) | Special reserve appropriated or reversed in accordance with laws or regulations set forth by the
authorities concerned; |
| 4) | An amount equal to the excess of the income from investments accounted for using the equity method
over cash dividends as special reserve; |
| 5) | Addition or deduction of realized gains or losses on equity instruments at fair value through other
comprehensive income; |
| 6) | Not more than 1.0% of the remainder, from 1) to 5), as compensation to directors and supervisors; |
| 7) | Between 7.0% to 11.0% of the remainder, from 1) to 5), as bonus to employees, of which 7.0% shall
be distributed in accordance with the employee bonus plan and the excess shall be distributed to specified employees at the board
of directors’ discretion; and |
| 8) | Any remainder from above as dividends to shareholders. |
Employees to whom referred
in 7) above include employees of subsidiaries that meet certain conditions, which are to be determined by the board of directors.
The Company is currently in
the mature growth stage. To meet the capital needs for business development now and in the future and satisfy the shareholders’
demand for cash inflows, the Company shall use residual dividend policy to distribute dividends, of which the cash dividend is
not lower than 30% of the total dividend distribution, with the remainder to be distributed in stock. A distribution plan is also
to be made by the board of directors and passed for resolution in the shareholders’ meeting.
For the three months ended
March 31, 2014 and 2015, the accrued bonus to employees of the Company was NT$339,291 thousand and NT$443,424 thousand, respectively,
and the accrued compensation to directors and supervisors of the Company was NT$30,845 thousand and NT$40,311 thousand, respectively.
The accrued bonus to employees and compensation to directors and supervisors represented 11% and 1%, respectively, of net income
(net of the bonus and compensation) for the three months ended March 31, 2014 and 2015. Material differences between such estimated
amounts and the amounts proposed by the board of directors on or before the consolidated financial statements are authorized for
issue are adjusted in the year the bonus and compensation were recognized. If there is a change in the proposed amounts after the
consolidated financial statements are authorized for issue, the differences are recorded as a change in accounting estimate. If
a share bonus is resolved to be distributed to employees, the number of shares is determined by dividing the amount of the share
bonus by the closing price (after considering the effect of cash and stock dividends) of the shares of the day
immediately preceding
the shareholders’ meeting.
Under Rule No. 1010012865 and
Rule No. 1010047490 issued by the FSC and the directive titled “Questions and Answers for Special Reserves Appropriated Following
Adoption of IFRSs”, the Company should appropriate or reverse to a special reserve. Any special reserve appropriated may
be reversed to the extent that the net debit balance reverses and thereafter distributed.
Appropriation of earnings to
legal reserve shall be made until the legal reserve equals the Company’s capital surplus. Legal reserve may be used to offset
deficits. If the Company has no deficit and the legal reserve has exceeded 25% of the Company’s capital surplus, the excess
may be transferred to capital or distributed in cash.
The appropriation of earnings,
the bonus to employees (distributed in cash) and the compensation to directors and supervisors for 2013 resolved at the Company’s
annual shareholders’ meetings in June 2014, and the appropriation of earnings, the bonus to employees (distributed in cash)
and the compensation to directors and supervisors for 2014 approved by the Company’s board of directors in March 2015 were
as follows:
| |
Appropriation of Earnings | |
Dividend Per Share |
| |
For Year 2013 | |
For Year 2014 | |
For Year 2013 | |
|
For Year 2014 |
| |
| NT$ | | |
| NT$ | | |
NT$ | |
|
NT$ |
| |
| | | |
| | | |
(in dollars) | |
|
(in dollars) |
| |
| | | |
| | | |
| |
|
|
Legal reserve | |
$ | 1,568,907 | | |
$ | 2,359,267 | | |
| |
|
|
Special reserve reversed | |
| (309,992 | ) | |
| — | | |
| |
|
|
Cash dividends | |
| 10,156,005 | | |
| 15,589,825 | | $ |
1.30 | |
$ |
2.00 |
| |
| | | |
| | | |
| |
|
|
| |
$ | 11,414,920 | | |
$ | 17,949,092 | | |
| |
|
|
| |
For Year 2013 | |
For Year 2014 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Bonus to employees | |
$ | 1,587,300 | | |
$ | 2,335,600 | |
Compensation to directors and supervisors | |
| 144,000 | | |
| 211,200 | |
The differences between the
resolved or approved amounts of the bonus to employees and compensation to directors and supervisors and the accrued amounts reflected
in the consolidated financial statements for the year ended December 31, 2013 and 2014 was deemed changes in estimates. The difference
was NT$385 thousand and NT$1,330 thousand and had been adjusted in earnings for the year ended December 31, 2014 and 2015, respectively.
Information regarding the bonus
to employees and the compensation to directors and supervisors approved by the Company’s board of directors and resolved
by the shareholders’ meeting is available on the Market Observation Post System website of the TSE.
| 1) | Exchange differences on translating foreign operations |
| |
2014 (Reviewed after Adjusted) | |
2015 |
| | | |
| NT$ | | |
| NT$ | |
| | | |
| | | |
| | |
| Balance at January 1 | | |
$ | (525,583 | ) | |
$ | 4,541,761 | |
(Continued)
| |
2014 (Reviewed after Adjusted) | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Exchange differences arising on translating foreign operations | |
| 1,539,896 | | |
| (1,617,220 | ) |
Share of exchange difference of associates accounted for using the equity method | |
| 1,358 | | |
| (144 | ) |
| |
| | | |
| | |
Balance at March 31 | |
$ | 1,015,671 | | |
$ | 2,924,397 | |
(Concluded)
| 2) | Unrealized gain on available-for-sale financial assets |
| |
2014 | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Balance at January 1 | |
$ | 426,246 | | |
$ | 526,778 | |
Unrealized gain (loss) arising on revaluation of available-for-sale financial assets | |
| 80,145 | | |
| (54,617 | ) |
Cumulative gain reclassified to profit or loss on disposal of available-for-sale financial assets | |
| (22,188 | ) | |
| (404 | ) |
Share of unrealized gain on available-for-sale financial assets of associates accounted for using the equity method | |
| 136,892 | | |
| 93,131 | |
| |
| | | |
| | |
Balance at March 31 | |
$ | 621,095 | | |
$ | 564,888 | |
| |
2014 | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Balance at January 1 | |
$ | (3,279 | ) | |
$ | — | |
Gain arising on changes in fair value of hedging instruments - Interest rate swap contracts | |
| 898 | | |
| — | |
Cumulative losses arising on changes in fair value of hedging instruments reclassified to profit or loss - Interest rate swap contracts | |
| 1,971 | | |
| — | |
| |
| | | |
| | |
Balance at March 31 | |
$ | (410 | ) | |
$ | — | |
| f. | Treasury shares (in thousand shares) |
| |
Beginning | |
| |
Retirement/ | |
Ending |
| |
Balance | |
Addition | |
Decrease | |
Balance |
| |
| |
| |
| |
|
Three months ended March 31, 2014 | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | |
Shares held by subsidiaries | |
| 145,883 | | |
| — | | |
| — | | |
| 145,883 | |
| |
| | | |
| | | |
| | | |
| | |
(Continued)
| |
Beginning | |
| |
Retirement/ | |
Ending |
| |
Balance | |
Addition | |
Decrease | |
Balance |
| |
| |
| |
| |
|
Three months ended March 31, 2015 | |
| |
| |
| |
|
| |
| | | |
| | | |
| | | |
| | |
Shares held by subsidiaries | |
| 145,883 | | |
| — | | |
| — | | |
| 145,883 | |
Shares reserved for bonds conversion | |
| — | | |
| 120,000 | | |
| — | | |
| 120,000 | |
| |
| | | |
| | | |
| | | |
| | |
| |
| 145,883 | | |
| 120,000 | | |
| — | | |
| 265,883 | |
(Concluded)
The Company’s shares
held by its subsidiaries at each balance sheet date were as follows:
| |
Shares Held By Subsidiaries | |
Carrying amount | |
Fair Value |
| |
(in thousand shares) | |
NT$ | |
NT$ |
| |
| |
| |
|
March 31, 2014 | |
| |
| |
|
| |
| | | |
| | | |
| | |
ASE Test | |
| 88,200 | | |
$ | 1,380,721 | | |
$ | 2,981,176 | |
J&R Holding | |
| 46,704 | | |
| 381,709 | | |
| 1,578,587 | |
ASE Test, Inc. | |
| 10,979 | | |
| 196,677 | | |
| 371,083 | |
| |
| | | |
| | | |
| | |
| |
| 145,883 | | |
$ | 1,959,107 | | |
$ | 4,930,846 | |
| |
| | | |
| | | |
| | |
December 31, 2014 | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
ASE Test | |
| 88,200 | | |
$ | 1,380,721 | | |
$ | 3,360,438 | |
J&R Holding | |
| 46,704 | | |
| 381,709 | | |
| 1,779,413 | |
ASE Test, Inc. | |
| 10,979 | | |
| 196,677 | | |
| 418,291 | |
| |
| | | |
| | | |
| | |
| |
| 145,883 | | |
$ | 1,959,107 | | |
$ | 5,558,142 | |
| |
| | | |
| | | |
| | |
March 31, 2015 | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
ASE Test | |
| 88,200 | | |
$ | 1,380,721 | | |
$ | 3,726,470 | |
J&R Holding | |
| 46,704 | | |
| 381,709 | | |
| 1,973,234 | |
ASE Test, Inc. | |
| 10,979 | | |
| 196,677 | | |
| 463,853 | |
| |
| | | |
| | | |
| | |
| |
| 145,883 | | |
$ | 1,959,107 | | |
$ | 6,163,557 | |
The Company issued ordinary
shares in connection with its merger with its subsidiaries. The shares held by its subsidiaries were reclassified from investments
accounted for using the equity method to treasury shares on the proportion owned by the Company.
Under the Securities and Exchange
Act in the ROC, the Company shall neither pledge treasury shares nor exercise shareholders’ rights on these shares, such
as rights to dividends and voting. The subsidiaries holding treasury shares, however, retain shareholders’ rights except
the rights to participate in any share issuance for cash and voting.
In February 2015, the board
of directors approved to repurchase up to 120,000 thousand of the Company’s ordinary shares which will be used for equity
conversion of convertible overseas bonds to
be issued in the future. As of March 31, 2015, the Company has completed the repurchase
and the shares repurchased accounted for 1.53% of the Company’s total issued shares. The average repurchase price was NT$44.45
per share.
| g. | Non-controlling interests |
| |
2014 (Reviewed after Adjusted) | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Balance at January 1 | |
$ | 4,133,282 | | |
$ | 8,219,098 | |
Attributable to non-controlling interests: | |
| | | |
| | |
Share of profit for the period | |
| 118,624 | | |
| 181,235 | |
Exchange difference on translating foreign operations | |
| 49,336 | | |
| (98,299 | ) |
Unrealized gain on available-for-sale financial assets | |
| 216 | | |
| 311 | |
Non-controlling interest relating to issue of ordinary shares under employee share options | |
| 11,709 | | |
| 16,396 | |
| |
| | | |
| | |
Balance at March 31 | |
$ | 4,313,167 | | |
$ | 8,318,741 | |
| 23. | PROFIT BEFORE INCOME TAX |
| |
For the Three Months Ended March 31 |
| |
2014 | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Dividends income | |
$ | 3,417 | | |
$ | 65,750 | |
Interest income | |
| 58,712 | | |
| 51,305 | |
Government subsidy | |
| 37,961 | | |
| 45,522 | |
Rental income | |
| 16,623 | | |
| 16,131 | |
| |
| | | |
| | |
| |
$ | 116,713 | | |
$ | 178,708 | |
| |
For the Three Months Ended March 31 |
| |
2014 | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Net gains on financial assets designated as at FVTPL | |
$ | 199,038 | | |
$ | 144,385 | |
Net gains (losses) arising on financial instruments held for trading | |
| 127,258 | | |
| (1,113,303 | ) |
Foreign exchange (losses) gains, net | |
| (668,322 | ) | |
| 539,877 | |
Others | |
| 101,537 | | |
| 43,265 | |
| |
| | | |
| | |
| |
$ | (240,489 | ) | |
$ | (385,776 | ) |
| |
For the Three Months Ended March 31 |
| |
2014 | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Total interest expense for financial liabilities measured at amortized cost | |
$ | 620,895 | | |
$ | 637,427 | |
Less: Amounts included in the cost of qualifying assets | |
| | | |
| | |
Inventories related to real estate business | |
| (12,719 | ) | |
| (48,156 | ) |
Property, plant and equipment | |
| (20,231 | ) | |
| (11,939 | ) |
| |
| 587,945 | | |
| 577,332 | |
Loss arising on derivatives as designated hedging instruments in cash flow hedge accounting relationship reclassified from equity to profit or loss | |
| 1,971 | | |
| — | |
Other finance costs | |
| 8,443 | | |
| 5,056 | |
| |
| | | |
| | |
| |
$ | 598,359 | | |
$ | 582,388 | |
Information relating to the
capitalized borrowing costs was as follows:
|
|
For the Three Months
Ended March 31 |
|
|
2014 |
|
2015 |
|
|
|
|
|
Annual interest capitalization rates |
|
|
|
|
Inventories related to real estate business (%) |
|
6.00-7.21 |
|
5.60-6.77 |
Property, plant and equipment (%) |
|
0.88-6.15 |
|
0.86-6.15 |
|
|
|
|
|
| d. | Depreciation and amortization |
| |
For the Three Months Ended March 31 |
| |
2014 | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Property, plant and equipment | |
$ | 6,269,956 | | |
$ | 7,256,998 | |
Intangible assets | |
| 135,271 | | |
| 135,828 | |
| |
| | | |
| | |
Total | |
$ | 6,405,227 | | |
$ | 7,392,826 | |
| |
| | | |
| | |
Summary of depreciation by function | |
| | | |
| | |
Operating costs | |
$ | 5,829,700 | | |
$ | 6,794,062 | |
Operating expenses | |
| 440,256 | | |
| 462,936 | |
| |
| | | |
| | |
| |
$ | 6,269,956 | | |
$ | 7,256,998 | |
| |
| | | |
| | |
Summary of amortization by function | |
| | | |
| | |
Operating costs | |
$ | 49,496 | | |
$ | 31,263 | |
Operating expenses | |
| 85,775 | | |
| 104,565 | |
| |
| | | |
| | |
| |
$ | 135,271 | | |
$ | 135,828 | |
| e. | Employee benefits expense |
| |
For the Three Months Ended March 31 |
| |
2014 (Reviewed after Adjusted) | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Post-employment benefits | |
| | | |
| | |
Defined contribution plans | |
$ | 363,809 | | |
$ | 410,806 | |
Defined benefit plans | |
| 104,858 | | |
| 104,879 | |
| |
| 468,667 | | |
| 515,685 | |
Equity-settled share-based payments | |
| 33,487 | | |
| 12,875 | |
Salary, incentives and bonus | |
| 8,952,610 | | |
| 10,425,557 | |
Other employee benefits | |
| 1,368,944 | | |
| 1,581,010 | |
| |
| | | |
| | |
| |
$ | 10,823,708 | | |
$ | 12,535,127 | |
| |
| | | |
| | |
Summary of employee benefits expense by function | |
| | | |
| | |
Operating costs | |
$ | 7,430,242 | | |
$ | 8,695,488 | |
Operating expenses | |
| 3,393,466 | | |
| 3,839,639 | |
| |
| | | |
| | |
| |
$ | 10,823,708 | | |
$ | 12,535,127 | |
| a. | Income tax expense recognized in profit or loss |
The major components of income
tax expense were as follows:
| |
For the Three Months Ended March 31 |
| |
2014 (Reviewed after Adjusted) | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Current income tax | |
| | | |
| | |
In respect of the current period | |
$ | 554,249 | | |
$ | 871,438 | |
Income tax on unappropriated earnings | |
| 25,737 | | |
| 49,452 | |
Adjustments for prior periods | |
| 1,569 | | |
| 23,935 | |
| |
| 581,555 | | |
| 944,825 | |
| |
| | | |
| | |
Deferred income tax | |
| | | |
| | |
In respect of the current period | |
| 100,631 | | |
| (16,993 | ) |
Effect of foreign currency exchange differences | |
| 47,827 | | |
| (71,652 | ) |
| |
| 148,458 | | |
| (88,645 | ) |
| |
| | | |
| | |
Income tax expense recognized in profit or loss | |
$ | 730,013 | | |
$ | 856,180 | |
As of March 31, 2014, December
31, 2014 and March 31, 2015, unappropriated earnings were all generated on and after January 1, 1998. As of March 31, 2014, December
31, 2014 and March 31, 2015, the balance of the Imputation Credit Account (“ICA”) was NT$733,341 thousand, NT$934,038
thousand and NT$951,809 thousand, respectively.
The creditable ratio for the
distribution of earnings of 2013 and 2014 was 6.10% (actual) and 6.23% (estimated), respectively.
Under the Integrated Income
Tax System, ROC resident shareholders are allowed a tax credit for their proportionate share of the income tax paid in the ROC
by the Company on earnings generated after January 1, 1998. Non-resident shareholders are allowed only a tax credit from the 10%
income tax on undistributed earnings, which can be used to reduce the withholding income tax on dividends. Starting from 2015,
the allowed tax credit is adjusted to 50% of the income tax paid in the ROC by the Company for ROC resident shareholders or 50%
of the 10% income tax on undistributed earnings for non-resident shareholders. The expected creditable ratio for the 2014 earnings
may be adjusted, depending on the ICA balance on the date of dividend distribution.
Income tax returns of ASE Inc.
and its ROC subsidiaries have been examined by authorities through 2012 and through 2010 to 2013, respectively. ASE Inc. and some
of its ROC subsidiaries disagreed with the result of examinations relating to its income tax returns for 2004 through 2008 and
2010 through 2012 and applied for appeal procedures. The related income tax expenses in the years resulting from the examinations
have been accrued in respective tax years.
The earnings and weighted average
number of ordinary shares outstanding in the computation of earnings per share were as follows:
Net profit for the period
| |
For the Three Months Ended March 31 |
| |
2014 (Reviewed after Adjusted) | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Net profit for the period attributable to owners of the Company | |
$ | 3,449,675 | | |
$ | 4,469,201 | |
Effect of potentially dilutive ordinary shares: | |
| | | |
| | |
Employee share options issued by subsidiaries | |
| (38,168 | ) | |
| (50,910 | ) |
| |
| | | |
| | |
Earnings used in the computation of diluted earnings per share | |
$ | 3,411,507 | | |
$ | 4,418,291 | |
Weighted average number
of ordinary shares outstanding (in thousand shares):
| |
For the Three Months Ended March 31 |
| |
2014 | |
2015 |
| |
| |
|
Weighted average number of ordinary shares in computation of basic earnings per share | |
| 7,654,229 | | |
| 7,706,555 | |
Effect of potentially dilutive ordinary shares: | |
| | | |
| | |
Employee share options | |
| 81,751 | | |
| 97,694 | |
Bonus to employees | |
| 54,736 | | |
| 63,902 | |
| |
| | | |
| | |
Weighted average number of ordinary shares in computation of diluted earnings per share | |
| 7,790,716 | | |
| 7,868,151 | |
The Group is able to settle
the bonus to employees by cash or shares. The Group presumed that the entire amount of the bonus would be settled in shares and
the resulting potential shares were included in the weighted average number of ordinary shares outstanding used in the computation
of diluted earnings per share if the effect is dilutive. Such dilutive effect of the potential shares was included in the computation
of diluted earnings per share until the shareholders approve the number of shares to be distributed to employees at their meeting
in the following year.
If the outstanding convertible
bonds issued by the Company were converted to ordinary shares, earnings used in the computation of diluted earnings per share would
have increased. Therefore, they were anti-dilutive and excluded from the computation of diluted earnings per share.
| 26. | SHARE-BASED PAYMENT ARRANGEMENTS |
Employee share option plans
of the Company and its subsidiaries
In order to attract, retain
and reward employees, ASE Inc. has four employee share option plans for full-time employees of the Group. Each unit represents
the right to purchase one ordinary share of ASE Inc. when exercised. Under the terms of the plans, share options are granted at
an exercise price equal to or not less than the closing price of the ordinary shares listed on the TSE at the grant date. The option
rights of these plans are valid for 10 years, non-transferable and exercisable at certain percentages subsequent to the second
anniversary of the grant date. For any subsequent changes in the Company’s capital structure, the exercise price is accordingly
adjusted.
In December 2014, the board
of directors approved the 5th employee share option plan. The plan has been declared to the authority and became effective in April
2015 while the options have not yet granted to employees.
Information about share options
was as follows:
| |
For the Three Months Ended March 31 |
| |
2014 | |
2015 |
| |
| |
Weighted | |
| |
Weighted |
| |
| |
Average | |
| |
Average |
| |
Number of | |
Exercise | |
Number of | |
Exercise |
| |
Options | |
Price | |
Options | |
Price |
| |
(In | |
Per Share | |
(In | |
Per Share |
| |
Thousands) | |
(NT$) | |
Thousands) | |
(NT$) |
| |
| |
| |
| |
|
Balance at January 1 | |
| 285,480 | | |
$ | 20.5 | | |
| 209,745 | | |
$ | 20.7 | |
Options forfeited | |
| (570 | ) | |
| 20.5 | | |
| (238 | ) | |
| 20.8 | |
Options exercised | |
| (25,150 | ) | |
| 18.0 | | |
| (27,218 | ) | |
| 20.5 | |
| |
| | | |
| | | |
| | | |
| | |
Balance at March 31 | |
| 259,760 | | |
| 20.7 | | |
| 182,289 | | |
| 20.8 | |
| |
| | | |
| | | |
| | | |
| | |
Options exercisable, end of period | |
| 203,776 | | |
| 20.7 | | |
| 162,370 | | |
| 20.7 | |
The weighted average share
prices at the dates of exercise of share options for the three months ended March 31, 2014 and 2015 was NT$29.6 and NT$41.4, respectively.
Information about the Company’s
outstanding share options at each balance sheet date was as follows:
| | | |
| Range
of Exercise Price Per Share (NT$) | | |
| Weighted Average Remaining Contractual Life (Years) | |
| | | |
| | | |
| | |
| March 31, 2014 | | |
| $ 11.1-13.5 | | |
| 0.9 | |
| | | |
| 20.4-22.6 | | |
| 5.1 | |
| | | |
| | | |
| | |
| December 31, 2014 | | |
| 11.1-13.5 | | |
| 0.4 | |
| | | |
| 20.4-22.6 | | |
| 4.4 | |
| | | |
| | | |
| | |
| March 31, 2015 | | |
| 11.1-13.5 | | |
| 0.1 | |
| | | |
| 20.4-22.6 | | |
| 4.2 | |
| b. | ASE Mauritius Inc. Option Plan |
ASE Mauritius Inc. has an employee
share option plan for full-time employees of the Group which granted 30,000 thousand units in December 2007. Under the terms of
the plan, each unit represents the right to purchase one ordinary share of ASE Mauritius Inc. when exercised. The option rights
of the plan are valid for 10 years, non-transferable and exercisable at certain percentages subsequent to the second anniversary
of the grant date.
Information about share options
was as follows:
| |
For the Three Months Ended March 31 |
| |
2014 | |
2015 |
| |
Number of | |
Exercise | |
Number of | |
Exercise |
| |
Options | |
Price | |
Options | |
Price |
| |
(In | |
Per Share | |
(In | |
Per Share |
| |
Thousands) | |
(US$) | |
Thousands) | |
(US$) |
| |
| |
| |
| |
|
Balance at January 1 | |
| 28,545 | | |
$ | 1.7 | | |
| 28,545 | | |
$ | 1.7 | |
Options forfeited | |
| — | | |
| — | | |
| (75 | ) | |
| 1.7 | |
Balance at March 31 | |
| 28,545 | | |
| 1.7 | | |
| 28,470 | | |
| 1.7 | |
| |
| | | |
| | | |
| | | |
| | |
Options exercisable, end of period | |
| 28,545 | | |
| 1.7 | | |
| 28,470 | | |
| 1.7 | |
As of March 31, 2014, December
31, 2014 and March 31, 2015, the remaining contractual life was 3.7 years, 3 years and 2.7 years, respectively.
The terms of the plans issued
by USIE were the same with those of the Company’s option plans. USIE modified its option plan granted in 2007 by extending
the contractual life to 12 years. The incremental fair value was all recognized as employee benefits expense in the years of modifications
since the options were all vested.
Information about share options
was as follows:
| |
For the Three Months Ended March 31 |
| |
2014 | |
2015 |
| |
| |
Weighted | |
| |
Weighted |
| |
| |
Average | |
| |
Average |
| |
Number of | |
Exercise | |
Number of | |
Exercise |
| |
Options | |
Price | |
Options | |
Price |
| |
(In | |
Per Share | |
(In | |
Per Share |
| |
Thousands) | |
(US$) | |
Thousands) | |
(US$) |
| |
| |
| |
| |
|
Balance at January 1 | |
| 34,939 | | |
$ | 2.1 | | |
| 34,159 | | |
$ | 2.1 | |
Options forfeited | |
| — | | |
| — | | |
| (36 | ) | |
| 2.7 | |
Balance at March 31 | |
| 34,939 | | |
| 2.1 | | |
| 34,123 | | |
| 2.1 | |
| |
| | | |
| | | |
| | | |
| | |
Options exercisable, end of period | |
| 28,281 | | |
| 2.0 | | |
| 30,871 | | |
| 2.0 | |
Information on USIE’s
outstanding share options at each balance sheet date was as follows:
| | | |
| Range of Exercise Price Per Share (US$) | | |
| Weighted Average Remaining Contractual Life (Years) | |
| | | |
| | | |
| | |
| March 31, 2014 | | |
$ | 1.5 | | |
| 4.7 | |
| | | |
| 2.4-2.9 | | |
| 6.6 | |
| | | |
| | | |
| | |
| December 31, 2014 | | |
| 1.5 | | |
| 5.0 | |
| | | |
| 2.4-2.9 | | |
| 5.8 | |
| | | |
| | | |
| | |
| March 31, 2015 | | |
| 1.5 | | |
| 4.7 | |
| | | |
| 2.4-2.9 | | |
| 5.6 | |
For the three months ended
March 31, 2014 and 2015, the Group entered into the following non-cash investing activities which were not reflected in the consolidated
statements of cash flows:
| |
For the Three Months Ended March 31 |
| |
2014 | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Payments for property, plant and equipment | |
| | | |
| | |
Purchase of property, plant and equipment | |
$ | 4,528,067 | | |
$ | 6,471,470 | |
Increase in prepayments for property, plant and equipment (recorded under the line item of other non-current assets) | |
| 263,667 | | |
| 323,152 | |
Decrease (increase) in payables for property, plant and equipment | |
| (796,285 | ) | |
| 979,765 | |
Capitalized borrowing costs | |
| (20,231 | ) | |
| (11,939 | ) |
| |
| | | |
| | |
| |
$ | 3,975,218 | | |
$ | 7,762,448 | |
| |
| | | |
| | |
Proceeds from disposal of property, plant and equipment | |
| | | |
| | |
Consideration from disposal of property, plant and equipment | |
$ | 252,367 | | |
$ | 11,919 | |
Decrease (increase) in other receivables | |
| (234,831 | ) | |
| 19,336 | |
| |
| | | |
| | |
| |
$ | 17,536 | | |
$ | 31,255 | |
| 28. | OPERATING LEASE ARRANGEMENTS |
Except those discussed in Note
17, the Company and its subsidiary, ASE Test, Inc., lease the land on which their buildings are located under various operating
lease agreements with the ROC government expiring through January 2023. The agreements grant these entities the option to renew
the leases and reserve the right for the lessor to adjust the lease payments upon an increase in the assessed value of the land
and to terminate the leases under certain conditions. In addition, the Group leases buildings, machinery and equipment under operating
leases.
The subsidiaries’ offices
located in U.S.A. and Japan, etc. are leased from other parties and the lease term will expire through 2015 to 2017 with the option
to renew the leases upon expiration.
The Group recognized rental
expense of NT$302,031 thousand and NT$365,508 thousand for the three months ended March 31, 2014 and 2015, respectively.
The capital structure of the
Group consists of debt and equity. The Group manages its capital to ensure that entities in the Group will be able to continue
as going concerns while maximizing the return to shareholders through the optimization of the debt and equity balance. Key management
personnel of the Group periodically reviews the cost of capital and the risks associated with each class of capital. In order to
balance the overall capital structure, the Group may adjust the amount of dividends paid to shareholders, the number of new shares
issued or repurchased, and the amount of new debt issued or existing debt redeemed.
The Group is not subject to
any externally imposed capital requirements except those discussed in Note 18.
| a. | Fair value of financial instruments that are not measured at fair value |
| 1) | Fair value of financial instruments not measured at fair value but for which fair value is disclosed |
Except bonds payable measured
at amortized cost, the management considers that the carrying amounts of financial assets and financial liabilities not measured
at fair value approximate their fair values.
The carrying amounts and fair
value of bonds payable as of March 31, 2014, December 31, 2014 and March 31, 2015, respectively, were as follows:
| |
Carrying Amount | |
Fair Value |
| | | |
| NT$ | | |
| NT$ | |
| | | |
| | | |
| | |
| March 31, 2014 | | |
$ | 21,717,446 | | |
$ | 22,298,551 | |
| December 31, 2014 | | |
| 31,270,131 | | |
| 31,702,988 | |
| March 31, 2015 | | |
| 31,092,655 | | |
| 31,656,393 | |
The aforementioned fair value
hierarchy of bonds payable was level 3 which was determined based on discounted cash flows or the last trading prices.
| b. | Fair value of financial instruments that are measured at fair value on a recurring basis |
| |
Level 1 | |
Level 2 | |
Level 3 | |
Total |
| |
NT$ | |
NT$ | |
NT$ | |
NT$ |
| |
| |
| |
| |
|
March 31, 2014 | |
| |
| |
| |
|
| |
| | | |
| | | |
| | | |
| | |
Financial assets at FVTPL | |
| | | |
| | | |
| | | |
| | |
Financial assets designated as at FVTPL | |
| | | |
| | | |
| | | |
| | |
Structured time deposits | |
$ | — | | |
$ | 2,313,595 | | |
$ | — | | |
$ | 2,313,595 | |
Private-placement convertible bonds | |
| — | | |
| 100,500 | | |
| — | | |
| 100,500 | |
| |
| | | |
| | | |
| | | |
| | |
Derivative financial assets | |
| | | |
| | | |
| | | |
| | |
Swap contracts | |
| — | | |
| 715,885 | | |
| — | | |
| 715,885 | |
Forward exchange contracts | |
| — | | |
| 13,108 | | |
| — | | |
| 13,108 | |
Cross currency swap contracts | |
| — | | |
| 9,578 | | |
| — | | |
| 9,578 | |
Foreign currency option contracts | |
| — | | |
| 1,936 | | |
| — | | |
| 1,936 | |
| |
| | | |
| | | |
| | | |
| | |
Non-derivative financial assets held for trading | |
| | | |
| | | |
| | | |
| | |
Open-end mutual funds | |
| 170,834 | | |
| — | | |
| — | | |
| 170,834 | |
Quoted shares | |
| 41,178 | | |
| — | | |
| — | | |
| 41,178 | |
| |
| | | |
| | | |
| | | |
| | |
| |
$ | 212,012 | | |
$ | 3,154,602 | | |
$ | — | | |
$ | 3,366,614 | |
(Continued)
| |
Level 1 | |
Level 2 | |
Level 3 | |
Total |
| |
| NT$ | | |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | | |
| | |
Available-for-sale financial assets | |
| | | |
| | | |
| | | |
| | |
Open-end mutual funds | |
$ | 1,867,557 | | |
$ | — | | |
$ | — | | |
$ | 1,867,557 | |
Limited partnership | |
| — | | |
| — | | |
| 594,965 | | |
| 594,965 | |
Quoted shares | |
| 343,841 | | |
| — | | |
| — | | |
| 343,841 | |
Unquoted shares | |
| — | | |
| — | | |
| 249,635 | | |
| 249,635 | |
| |
| | | |
| | | |
| | | |
| | |
| |
$ | 2,211,398 | | |
$ | — | | |
$ | 844,600 | | |
$ | 3,055,998 | |
| |
| | | |
| | | |
| | | |
| | |
Financial liabilities at FVTPL | |
| | | |
| | | |
| | | |
| | |
Derivative financial liabilities | |
| | | |
| | | |
| | | |
| | |
Conversion option, redemption option and put option of convertible bonds | |
$ | — | | |
$ | 2,275,500 | | |
$ | — | | |
$ | 2,275,500 | |
Swap contracts | |
| — | | |
| 66,531 | | |
| — | | |
| 66,531 | |
Forward exchange contracts | |
| — | | |
| 40,066 | | |
| — | | |
| 40,066 | |
Foreign currency option contracts | |
| — | | |
| 28,426 | | |
| — | | |
| 28,426 | |
Interest rate swap contracts | |
| — | | |
| 3,418 | | |
| — | | |
| 3,418 | |
| |
| | | |
| | | |
| | | |
| | |
| |
$ | — | | |
$ | 2,413,941 | | |
$ | — | | |
$ | 2,413,941 | |
| |
| | | |
| | | |
| | | |
| | |
Derivative financial liabilities for hedging | |
| | | |
| | | |
| | | |
| | |
Interest rate swap contracts | |
$ | — | | |
$ | 515 | | |
$ | — | | |
$ | 515 | |
| |
| | | |
| | | |
| | | |
| | |
December 31, 2014 | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | |
Financial assets at FVTPL | |
| | | |
| | | |
| | | |
| | |
Financial assets designated as at FVTPL | |
| | | |
| | | |
| | | |
| | |
Structured time deposits | |
$ | — | | |
$ | 2,376,050 | | |
$ | — | | |
$ | 2,376,050 | |
Private-placement convertible bonds | |
| — | | |
| 100,500 | | |
| — | | |
| 100,500 | |
| |
| | | |
| | | |
| | | |
| | |
Derivative financial assets | |
| | | |
| | | |
| | | |
| | |
Swap contracts | |
| — | | |
| 1,907,705 | | |
| — | | |
| 1,907,705 | |
Forward exchange contracts | |
| — | | |
| 27,811 | | |
| — | | |
| 27,811 | |
| |
| | | |
| | | |
| | | |
| | |
Non-derivative financial assets held for trading | |
| | | |
| | | |
| | | |
| | |
Open-end mutual funds | |
| 533,425 | | |
| — | | |
| — | | |
| 533,425 | |
Quoted shares | |
| 43,352 | | |
| — | | |
| — | | |
| 43,352 | |
| |
| | | |
| | | |
| | | |
| | |
| |
$ | 576,777 | | |
$ | 4,412,066 | | |
$ | — | | |
$ | 4,988,843 | |
| |
| | | |
| | | |
| | | |
| | |
Available-for-sale financial assets | |
| | | |
| | | |
| | | |
| | |
Open-end mutual funds | |
$ | 1,500,434 | | |
$ | — | | |
$ | — | | |
$ | 1,500,434 | |
Limited Partnership | |
| — | | |
| — | | |
| 555,361 | | |
| 555,361 | |
(Continued)
| |
Level 1 | |
Level 2 | |
Level 3 | |
Total |
| |
| NT$ | | |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | | |
| | |
Unquoted shares | |
$ | — | | |
$ | — | | |
$ | 223,505 | | |
$ | 223,505 | |
Quoted shares | |
| 195,070 | | |
| — | | |
| — | | |
| 195,070 | |
| |
| | | |
| | | |
| | | |
| | |
| |
$ | 1,695,504 | | |
$ | — | | |
$ | 778,866 | | |
$ | 2,474,370 | |
| |
| | | |
| | | |
| | | |
| | |
Financial liabilities at FVTPL | |
| | | |
| | | |
| | | |
| | |
Derivative financial liabilities | |
| | | |
| | | |
| | | |
| | |
Conversion option, redemption option and put option of convertible bonds | |
$ | — | | |
$ | 2,520,606 | | |
$ | — | | |
$ | 2,520,606 | |
Swap contracts | |
| — | | |
| 99,165 | | |
| — | | |
| 99,165 | |
Forward exchange contracts | |
| — | | |
| 31,581 | | |
| — | | |
| 31,581 | |
| |
| | | |
| | | |
| | | |
| | |
| |
$ | — | | |
$ | 2,651,352 | | |
$ | — | | |
$ | 2,651,352 | |
| |
| | | |
| | | |
| | | |
| | |
March 31, 2015 | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | |
Financial assets at FVTPL | |
| | | |
| | | |
| | | |
| | |
Financial assets designated as at FVTPL | |
| | | |
| | | |
| | | |
| | |
Structured time deposits | |
$ | — | | |
$ | 2,349,660 | | |
$ | — | | |
$ | 2,349,660 | |
Private-placement convertible bonds | |
| — | | |
| 100,500 | | |
| — | | |
| 100,500 | |
| |
| | | |
| | | |
| | | |
| | |
Derivative financial assets | |
| | | |
| | | |
| | | |
| | |
Swap contracts | |
| — | | |
| 1,313,588 | | |
| — | | |
| 1,313,588 | |
Forward exchange contracts | |
| — | | |
| 182,200 | | |
| — | | |
| 182,200 | |
| |
| | | |
| | | |
| | | |
| | |
Non-derivative financial assets held for trading | |
| | | |
| | | |
| | | |
| | |
Open-end mutual funds | |
| 534,322 | | |
| — | | |
| — | | |
| 534,322 | |
Quoted shares | |
| 37,242 | | |
| — | | |
| — | | |
| 37,242 | |
Repurchase agreements collateralized by bonds | |
| 12,779 | | |
| — | | |
| — | | |
| 12,779 | |
| |
| | | |
| | | |
| | | |
| | |
| |
$ | 584,343 | | |
$ | 3,945,948 | | |
$ | — | | |
$ | 4,530,291 | |
| |
| | | |
| | | |
| | | |
| | |
Available-for-sale financial assets | |
| | | |
| | | |
| | | |
| | |
Open-end mutual funds | |
$ | 949,599 | | |
$ | — | | |
$ | — | | |
$ | 949,599 | |
Limited partnership | |
| — | | |
| — | | |
| 459,187 | | |
| 459,187 | |
Quoted shares | |
| 229,747 | | |
| — | | |
| — | | |
| 229,747 | |
Unquoted shares | |
| — | | |
| — | | |
| 226,492 | | |
| 226,492 | |
| |
| | | |
| | | |
| | | |
| | |
| |
$ | 1,179,346 | | |
$ | — | | |
$ | 685,679 | | |
$ | 1,865,025 | |
| |
| | | |
| | | |
| | | |
| | |
Financial liabilities at FVTPL | |
| | | |
| | | |
| | | |
| | |
Derivative financial liabilities | |
| | | |
| | | |
| | | |
| | |
Conversion option, redemption option and put option of convertible bonds | |
$ | — | | |
$ | 3,456,772 | | |
$ | — | | |
$ | 3,456,772 | |
(Continued)
| |
Level 1 | |
Level 2 | |
Level 3 | |
Total |
| |
| NT$ | | |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | | |
| | |
Swap contracts | |
$ | — | | |
$ | 142,815 | | |
$ | — | | |
$ | 142,815 | |
Foreign currency option contracts | |
| — | | |
| 90,692 | | |
| — | | |
| 90,692 | |
Forward exchange contracts | |
| — | | |
| 11,071 | | |
| — | | |
| 11,071 | |
| |
| | | |
| | | |
| | | |
| | |
| |
$ | — | | |
$ | 3,701,350 | | |
$ | — | | |
$ | 3,701,350 | |
(Concluded)
There were no transfers between
Level 1 and Level 2 for the three months ended March 31, 2014 and 2015.
| 2) | Reconciliation of Level 3 fair value measurements of financial assets |
The financial assets measured
at Level 3 fair value were equity investments with no quoted prices classified as available-for-sale financial assets - non-current.
Reconciliations for the three months ended March 31, 2014 and 2015 were as follows:
| |
2014 | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Balance at January 1 | |
$ | 797,162 | | |
$ | 778,866 | |
Purchase | |
| 30,000 | | |
| 1,279 | |
Total gains (losses) recognized in other comprehensive income | |
| 17,438 | | |
| (94,466 | ) |
| |
| | | |
| | |
Balance at March 31 | |
$ | 844,600 | | |
$ | 685,679 | |
As of March 31, 2014 and 2015,
unrealized gain of NT$31,390 thousand and unrealized loss of NT$113,071 thousand, recorded in other comprehensive income under
the heading of unrealized gain (loss) on available-for-sale financial assets, were included in the carrying amount of the financial
assets at fair value on Level 3 fair value measurement.
| 3) | Valuation techniques and assumptions applied for the purpose of measuring fair value |
| a) | Valuation techniques and inputs applied for the purpose of measuring Level 2 fair value measurement |
Financial Instruments |
|
Valuation Techniques and Inputs |
|
|
|
Derivatives - swap contracts, forward exchange contracts, foreign currency option contracts and cross currency swap contracts |
|
Discounted cash flows - Future cash flows are estimated based on observable forward exchange rates at balance sheet dates and contract forward rates, discounted at rates that reflected the credit risk of various counterparties. |
|
|
|
Derivatives - conversion option, redemption option and put option of convertible bonds |
|
Option pricing model - Incorporation of present value techniques and reflect both the time value and the intrinsic value of options |
|
|
|
Structured time deposits and private-placement convertible bonds |
|
Discounted cash flows - Future cash flows are estimated based on observable forward exchange rates or stock prices at balance sheet dates and contract interest rate ranges or conversion prices, discounted at rates that reflected the credit risk of various counterparties. |
(Concluded)
b) Valuation
techniques and inputs applied for the purpose of measuring Level 3 fair value measurement
The fair value of the Group’s
investments in unquoted shares on Level 3 fair value measurement were measured using market approach based on investees’
recent financing activities, technical development, valuation of investees comparable companies, market conditions and other economic
indicators.
The fair values of investments
in limited partnership are valued using discounted cash flow technique and a comparable multiple technique. The significant unobservable
inputs used in the discounted cash flow technique were discount rates of 9.10% to 12.98% and the terminal growth rates of 2.00%
to 2.50%. Any significant increase in discount rates or any significant decrease in terminal growth rates would result in a decrease
in the fair value of the investments in limited partnership. The significant unobservable input used in the comparable multiple
technique was EBITDA multiples of 9.00 to 9.36. Any significant decrease in multiples would result in a decrease in the fair value
of the investments in limited partnership.
| c. | Categories of financial instruments |
| |
March 31, 2014 | |
December
31, 2014 | |
March
31, 2015 |
| |
NT$ | |
NT$ | |
NT$ |
| |
| |
| |
|
Financial assets | |
| |
| |
|
| |
| | | |
| | | |
| | |
FVTPL | |
| | | |
| | | |
| | |
Designated as at FVTPL | |
$ | 2,414,095 | | |
$ | 2,476,550 | | |
$ | 2,450,160 | |
Held for trading | |
| 952,519 | | |
| 2,512,293 | | |
| 2,080,131 | |
Available-for-sale financial assets | |
| 3,055,998 | | |
| 2,474,370 | | |
| 1,865,025 | |
Loans and receivables (Note 1) | |
| 82,693,906 | | |
| 106,158,279 | | |
| 93,957,781 | |
| |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
Financial liabilities | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
FVTPL | |
| | | |
| | | |
| | |
Held for trading | |
| 2,413,941 | | |
| 2,651,352 | | |
| 3,701,350 | |
Derivative instruments in designated hedge accounting relationships | |
| 515 | | |
| — | | |
| — | |
Measured at amortized cost (Note 2) | |
| 131,472,852 | | |
| 157,157,392 | | |
| 145,291,870 | |
Note
1: The balances included loans and receivables measured at amortized cost which comprise cash and cash equivalents, trade and
other receivables and other financial assets.
Note
2: The balances included financial liabilities measured at amortized cost which comprise short-term and long-term borrowings,
trade and other payables, bonds payable and long-term payables.
| d. | Financial risk management objectives and policies |
The derivative instruments
used by the Group are to mitigate risks arising from ordinary business operations. All derivative transactions entered into by
the Group are designated as either hedging or trading. Derivative transactions entered into for hedging purposes must hedge risk
against fluctuations in foreign exchange rates and interest rates arising from operating activities. The currencies and the amount
of derivative instruments held by the Group must match its hedged assets and liabilities
denominated in foreign currencies.
The Group's risk management
department monitors risks to mitigate risk exposures, reports unsettled position, transaction balances and related gains or losses
to the Group’s chief financial officer on monthly basis.
The Group’s activities
exposed it primarily to the financial risks of changes in foreign currency exchange rates and interest rates. Gains or losses arising
from fluctuations in foreign currency exchange rates of a variety of derivative financial instruments were approximately offset
by those of hedged items. Interest rate risk was not significant due to the cost of capital was expected to be fixed.
There had been no change to
the Group's exposure to market risks or the manner in which these risks were managed and measured.
| a) | Foreign currency exchange rate risk |
The Group had sales and purchases
as well as financing activities denominated in foreign currency which exposed the Group to foreign currency exchange rate risk.
The Group entered into a variety of derivative financial instruments to hedge foreign currency exchange rate risk to minimize the
fluctuations of assets and liabilities denominated in foreign currencies.
The carrying amounts of the
Group's foreign currency denominated monetary assets and liabilities (including those eliminated upon consolidation) as well as
derivative instruments which exposed the Group to foreign currency exchange rate risk at each balance sheet date are presented
in Note 35.
The Group was principally subject
to the impact to exchange rate fluctuation in U.S. dollars and Japanese yen against NT$ or Chinese Yuan Renminbi (“CNY”).
1% is the sensitivity rate used when reporting foreign currency exchange rate risk internally to key management personnel and represents
management’s assessment of the reasonably possible change in foreign currency exchange rates. The sensitivity analysis included
financial assets and liabilities and inter-company receivables and payables within the Group. The changes in profit before income
tax due to a 1% change in U.S. dollars and Japanese yen both against NT$ and CNY would be NT$28,000 thousand and NT$21,000 thousand
for the three months ended March 31, 2014 and 2015, respectively. Hedging contracts and hedged items have been taken into account
while measuring the changes in profit before income tax. The sensitivity analysis for foreign currency exchange rate risk to which
the Group was exposed at each balance sheet date was unrepresentative of a risk inherent for the three months ended March 31, 2014
and 2015.
Except a portion of long-term
borrowings and bonds payable at fixed interest rates, the Group was exposed to interest rate risk because group entities borrowed
funds at floating interest rates. Changes in market interest rates will lead to variances in effective interest rates of borrowings
from which the future cash flow fluctuations arise.
The carrying amounts of the
Group's financial assets and financial liabilities with exposure to interest rates at each balance sheet date were as follows:
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Fair value interest rate risk | |
| | | |
| | | |
| | |
Financial liabilities | |
$ | 22,428,159 | | |
$ | 34,003,038 | | |
$ | 32,650,080 | |
| |
| | | |
| | | |
| | |
Cash flow interest rate risk | |
| | | |
| | | |
| | |
Financial assets | |
| 43,841,095 | | |
| 51,603,455 | | |
| 45,107,352 | |
Financial liabilities | |
| 65,204,504 | | |
| 65,149,698 | | |
| 49,192,986 | |
For assets and liabilities with
floating interest rates, a 100 basis point increase or decrease was used when reporting interest rate risk internally to key management
personnel. If interest rates had been 100 basis points (1%) higher or lower and all other variables held constant, the Group’s
profit before income tax for the three months ended March 31, 2014 and 2015 would have decreased or increased by NT$54,000 thousand
and NT$11,000 thousand , respectively.
The Group was exposed to equity
or debt price risk through its investments in financial assets at FVTPL, including private-placement convertible bonds, quoted
shares, open-end mutual funds and repurchase agreements collateralized by bonds, and available-for-sale financial assets. If equity
or debt prices were 1% higher or lower, profit before income tax for the three months ended March 31, 2014 and 2015 would have
increased or decreased by NT$3,200 thousand and NT$6,900 thousand, respectively, and other comprehensive income before income tax
for the three months ended March 31, 2014 and 2015 would have increased or decreased by NT$31,000 thousand and NT$19,000 thousand,
respectively.
In addition, the Group was also
exposed to the Company’s ordinary share price risk through Bonds Options recognized as financial liabilities held for trading.
7% is the sensitivity rate used when reporting price risk internally to key management personnel. If the Company’s ordinary
share price increased or decreased by 7%, profit before income tax for the three months ended March 31, 2014 and 2015 would have
decreased approximately by NT$550,000 thousand and NT$820,000 thousand, respectively, or increased approximately by NT$490,000
thousand and NT$750,000 thousand, respectively.
Credit risk refers to the risk
that counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group’s credit
risk arises from cash and cash equivalents, receivables and other financial assets. The Group’s maximum exposure to credit
risk was the carrying amounts of financial assets in the consolidated balance sheets.
The Group dealt with counterparties
creditworthy and has a credit policy and trade receivable management procedures to ensure recovery and evaluation of trade receivables.
The Group’s counterparties consisted of a large number of customers and banks and there was no significant concentration
of credit risk exposure.
The Group manages liquidity
risk by maintaining adequate working capital and banking facilities to fulfill the demand for cash flow used in the Group’s
operation and capital expenditure. The Group also monitors its compliance with all the loan covenants. Liquidity risk is not considered
to be significant.
In the table below, financial
liabilities with a repayment on demand clause were included in the earliest time band regardless of the probability of counter-parties
choosing to exercise their rights. The maturity dates for other non-derivative financial liabilities were based on the agreed repayment
dates.
To the extent that interest
flows are floating rate, the undiscounted amounts were derived from the interest rates at each balance sheet date.
| |
On Demand or Less than 1 Month | |
1 to 3 Months | |
3 Months to 1 Year | |
1 to 5 Years | |
More than 5 Years |
| |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ |
March 31, 2014 | |
| |
| |
| |
| |
|
| |
| | | |
| | | |
| | | |
| | | |
| | |
Non-derivative financial liabilities | |
| | | |
| | | |
| | | |
| | | |
| | |
Non-interest bearing | |
$ | 17,327,692 | | |
$ | 15,333,209 | | |
$ | 2,485,878 | | |
$ | 550,159 | | |
$ | 28,053 | |
Floating interest rate liabilities | |
| 11,631,224 | | |
| 15,233,311 | | |
| 15,076,344 | | |
| 25,685,293 | | |
| — | |
Fixed interest rate liabilities | |
| 288,576 | | |
| 179,224 | | |
| 1,377,018 | | |
| 23,783,165 | | |
| — | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
| |
$ | 29,247,492 | | |
$ | 30,745,744 | | |
$ | 18,939,240 | | |
$ | 50,018,617 | | |
$ | 28,053 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
December 31, 2014 | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Non-derivative financial liabilities | |
| | | |
| | | |
| | | |
| | | |
| | |
Non-interest bearing | |
$ | 23,660,711 | | |
$ | 21,370,876 | | |
$ | 4,606,064 | | |
$ | 155,599 | | |
$ | 29,139 | |
Floating interest rate liabilities | |
| 21,534,220 | | |
| 9,003,403 | | |
| 12,364,453 | | |
| 23,870,629 | | |
| 175,302 | |
Fixed interest rate liabilities | |
| 684,039 | | |
| 838,234 | | |
| 846,899 | | |
| 34,458,859 | | |
| — | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
| |
$ | 45,878,970 | | |
$ | 31,212,513 | | |
$ | 17,817,416 | | |
$ | 58,485,087 | | |
$ | 204,441 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
March 31, 2015 | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Non-derivative financial liabilities | |
| | | |
| | | |
| | | |
| | | |
| | |
Non-interest bearing | |
$ | 21,402,615 | | |
$ | 18,335,866 | | |
$ | 3,991,953 | | |
$ | 158,295 | | |
$ | 28,817 | |
Floating interest rate liabilities | |
| 10,917,633 | | |
| 5,951,171 | | |
| 8,260,435 | | |
| 25,471,004 | | |
| 142,975 | |
Fixed interest rate liabilities | |
| 9,149,721 | | |
| 2,855,138 | | |
| 1,856,541 | | |
| 32,928,356 | | |
| — | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
| |
$ | 41,469,969 | | |
$ | 27,142,175 | | |
$ | 14,108,929 | | |
$ | 58,557,655 | | |
$ | 171,792 | |
The amounts included above
for floating interest rate instruments for non-derivative financial liabilities was subject to change if changes in floating interest
rates differ from those estimates of interest rates determined at each balance sheet date.
The following table detailed
the Group's liquidity analysis for its derivative financial instruments. The table was based on the undiscounted contractual net
cash inflows and outflows on derivative instruments that settle on a net basis, and the undiscounted gross cash inflows and outflows
on those derivatives that require gross settlement. When the amounts payable or receivable are not fixed, the amounts disclosed
have been determined by reference to the projected interest rates as illustrated by the yield curves at each balance sheet date.
| |
On Demand or Less than 1 Month | |
1 to 3 Months | |
3 Months to 1 Year |
| |
NT$ | |
NT$ | |
NT$ |
| |
| |
| |
|
March 31, 2014 | |
| |
| |
|
| |
| | | |
| | | |
| | |
Net settled | |
| | | |
| | | |
| | |
Forward exchange contracts | |
$ | 2,465 | | |
$ | 800 | | |
$ | — | |
Foreign currency option contracts | |
| 2,690 | | |
| — | | |
| — | |
| |
| | | |
| | | |
| | |
| |
$ | 5,155 | | |
$ | 800 | | |
$ | — | |
| |
| | | |
| | | |
| | |
(Continued)
| |
On Demand or Less than 1 Month | |
1 to 3 Months | |
3 Months to 1 Year |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Gross settled | |
| | | |
| | | |
| | |
Forward exchange contracts | |
| | | |
| | | |
| | |
Inflows | |
$ | 2,061,385 | | |
$ | 1,499,197 | | |
$ | 364,651 | |
Outflows | |
| (2,071,529 | ) | |
| (1,505,604 | ) | |
| (365,640 | ) |
| |
| (10,144 | ) | |
| (6,407 | ) | |
| (989 | ) |
| |
| | | |
| | | |
| | |
Swap contracts | |
| | | |
| | | |
| | |
Inflows | |
| 3,385,217 | | |
| 8,443,526 | | |
| 24,214,547 | |
Outflows | |
| (3,342,734 | ) | |
| (8,328,483 | ) | |
| (23,542,686 | ) |
| |
| 42,483 | | |
| 115,043 | | |
| 671,861 | |
| |
| | | |
| | | |
| | |
Cross currency swap contracts | |
| | | |
| | | |
| | |
Inflows | |
| 166 | | |
| 355 | | |
| 609,566 | |
Outflows | |
| — | | |
| — | | |
| (598,600 | ) |
| |
| 166 | | |
| 355 | | |
| 10,966 | |
| |
| | | |
| | | |
| | |
Interest rate swap contracts | |
| | | |
| | | |
| | |
Inflows | |
| 3,992 | | |
| — | | |
| 8,742 | |
Outflows | |
| (5,944 | ) | |
| — | | |
| (12,169 | ) |
| |
| (1,952 | ) | |
| — | | |
| (3,427 | ) |
| |
| | | |
| | | |
| | |
| |
$ | 30,553 | | |
$ | 108,991 | | |
$ | 678,411 | |
| |
| | | |
| | | |
| | |
December 31, 2014 | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
Gross settled | |
| | | |
| | | |
| | |
Forward exchange contracts | |
| | | |
| | | |
| | |
Inflows | |
$ | 3,662,813 | | |
$ | 1,959,573 | | |
$ | 9,241 | |
Outflows | |
| (3,655,279 | ) | |
| (1,940,145 | ) | |
| (9,331 | ) |
| |
| 7,534 | | |
| 19,428 | | |
| 90 | |
| |
| | | |
| | | |
| | |
Swap contracts | |
| | | |
| | | |
| | |
Inflows | |
| 10,342,259 | | |
| 4,621,200 | | |
| 33,399,031 | |
Outflows | |
| (10,215,834 | ) | |
| (4,461,118 | ) | |
| (31,646,310 | ) |
| |
| 126,425 | | |
| 160,082 | | |
| 1,752,721 | |
| |
| | | |
| | | |
| | |
| |
$ | 133,959 | | |
$ | 179,510 | | |
$ | 1,752,631 | |
| |
| | | |
| | | |
| | |
March 31, 2015 | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | |
Net settled | |
| | | |
| | | |
| | |
Forward exchange contracts | |
$ | 42,770 | | |
$ | 31,550 | | |
$ | — | |
| |
| | | |
| | | |
| | |
Gross settled | |
| | | |
| | | |
| | |
Forward exchange contracts | |
| | | |
| | | |
| | |
Inflows | |
$ | 4,429,731 | | |
$ | 3,124,080 | | |
$ | — | |
Outflows | |
| (4,357,138 | ) | |
| (3,061,620 | ) | |
| — | |
| |
| 72,593 | | |
| 62,460 | | |
| — | |
| |
| | | |
| | | |
| | |
(Continued)
| |
On Demand or Less than 1 Month | |
1 to 3 Months | |
3 Months to 1 Year |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Swap contracts | |
| | | |
| | | |
| | |
Inflows | |
$ | 11,515,758 | | |
$ | 13,338,518 | | |
$ | 36,186,615 | |
Outflows | |
| (11,427,204 | ) | |
| (13,023,847 | ) | |
| (35,216,495 | ) |
| |
| 88,554 | | |
| 314,671 | | |
| 970,120 | |
| |
| | | |
| | | |
| | |
Foreign currency option contracts | |
| | | |
| | | |
| | |
Inflows | |
| 250,400 | | |
| — | | |
| — | |
Outflows | |
| (243,760 | ) | |
| — | | |
| — | |
| |
| 6,640 | | |
| — | | |
| — | |
| |
| | | |
| | | |
| | |
| |
$ | 167,787 | | |
$ | 377,131 | | |
$ | 970,120 | |
(Concluded)
| 31. | RELATED PARTY TRANSACTIONS |
Balances and transactions within
the Group had been eliminated upon consolidation. Details of transactions between the Group and other related parties were disclosed
as follows:
| a. | The Company contributed NT$100,000 thousand to ASE Cultural and Educational Foundation in January
2015 for environmental charity in promoting the related domestic environmental protection and public service activities (Note 33). |
Except for the aforementioned,
the Group had no material transactions with related parties for the three months ended March 31, 2014 and 2015.
| b. | Compensation to key management personnel |
| |
For the Three Months Ended March 31 |
| |
2014 | |
2015 |
| |
| NT$ | | |
| NT$ | |
| |
| | | |
| | |
Short-term employee benefits | |
$ | 192,637 | | |
$ | 247,992 | |
Post-employment benefits | |
| 1,338 | | |
| 799 | |
Share-based payments | |
| 10,106 | | |
| 5,883 | |
| |
| | | |
| | |
| |
$ | 204,081 | | |
$ | 254,674 | |
The compensation to the Company’s
key management personnel is according to personal performance and market trends.
| 32. | ASSETS PLEDGED AS COLLATERAL OR FOR SECURITY |
In addition to Note 10, the
following assets were provided as collateral for bank borrowings, the tariff guarantees of imported raw materials:
| |
March 31, 2014 | |
December 31, 2014 | |
March 31, 2015 |
| |
| NT$ | | |
| NT$ | | |
| NT$ | |
| |
| | | |
| | | |
| | |
Inventories related to real estate business | |
$ | 12,722,773 | | |
$ | 15,164,858 | | |
$ | 15,245,880 | |
Property, plant and equipment | |
| | | |
| | | |
| | |
Land | |
| 299,059 | | |
| — | | |
| — | |
Buildings
and improvements | |
| 329,207 | | |
| — | | |
| — | |
Other financial assets (including current and non-current) | |
| 240,932 | | |
| 268,562 | | |
| 267,140 | |
| |
| | | |
| | | |
| | |
| |
$ | 13,591,971 | | |
$ | 15,433,420 | | |
$ | 15,513,020 | |
| 33. | SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED COMMITMENTS |
In addition to those disclosed
in other notes, significant commitments and contingencies of the Group as of each balance sheet date were as follows:
| a. | Significant commitments |
| 1) | As of March 31, 2014, December 31, 2014 and March 31, 2015, unused letters of credit of the Group
were approximately NT$327,000 thousand, NT$137,000 thousand and NT$63,000 thousand, respectively. |
| 2) | As of March 31, 2014, December 31, 2014 and March 31, 2015, outstanding commitments to purchase
property, plant and equipment of the Group were approximately NT$12,565,000 thousand, NT$17,498,000 thousand and NT$13,083,000
thousand, respectively, of which NT$1,893,305 thousand, NT$1,516,396 thousand and NT$2,204,144 thousand had been prepaid, respectively. |
| 3) | In consideration of corporate social responsibility for environmental protection, the Company’s
board of directors, in December 2013, approved contributions to be made in the next 30 years, at a total amount of NT$3,000,000
thousand, at the minimum, to environmental protection efforts in Taiwan. |
| b. | Non-cancellable operating lease commitments |
| |
March 31, 2015 |
| |
| NT$ | |
| |
| | |
Less than 1 year | |
$ | 221,307 | |
1 to 5 years | |
| 291,489 | |
More than 5 years | |
| 399,492 | |
| |
| | |
| |
$ | 912,288 | |
34. SIGNIFICANT
SUBSEQUENT EVENTS
| a. | To
enhance operational flexibility via structural adjustments, the board of directors of the Company’s subsidiary, USI, resolved
in January 2015 the spin-off of its investment business as well as capital reduction of NT$16,012,966 thousand by reducing 1,601,297
thousand shares (a reduction ratio of 97.56%), and will assign its investment business to USI, Inc. (“New USI”), a
newly established business entity. As the consideration of the business value to be spun-off by USI, New USI will issue 1,000,000
thousand new ordinary shares to the shareholders of USI. Based on the shareholdings on the record date of the spin-off, the shareholders
of USI will receive 609.27 shares of New USI’s |
| | ordinary share in exchange of each 1,000 shares of USI’s ordinary share. The record date of the
spin-off was April 1, 2015. USI completed the registration process of capital reduction on April 17, 2015, and New USI also
completed the registration of the incorporation on the same date. After
the spin-off, the Group will have control over both USI and New USI, and the spin-off will not have material impact on the financial
position and business operation of the Group. |
| b. | The Group’s subsidiary, USIE, sold its shareholdings of 54,000 thousand ordinary shares of
USISH amounting to CNY1,992,060 thousand in April 2015 and, as a result, the Group’s shareholdings of USISH decreased from
82.1% to 77.2%. The transaction was accounted for as an equity transaction since the Group did not cease to have control over USISH. |
| c. | The Company’s board of directors resolved on May 8, 2015 to set up the joint venture with
TDK Corporation (“TDK”) to invest in ASE Embedded Electronics Inc. (“ASEEE Inc.”) with US$39,490 thousand.
The Company will invest US$20,140 thousand in ASEEE Inc. and have its shareholdings of 51%. In addition, ASEE Inc. will pay TDK
US$19,350 thousand for TDK’s technology licensing of IC embedded substrates. |
| d. | The Company’s board of directors resolved on May 8, 2015 to offer the fourth unsecured convertible
overseas bonds up to US$220,000 thousand. The Company’s treasury shares are reserved for the bonds’ conversion. |
| 35. | SIGNIFICANT ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES |
The following information was
aggregated by the foreign currencies other than functional currencies of the group entities and the exchange rates between foreign
currencies and respective functional currencies were disclosed. The significant assets and liabilities denominated in foreign currencies
were as follows:
| |
Foreign Currencies (In Thousand) | |
Exchange Rate | |
Carrying Amount (In Thousand) |
| |
| |
| |
|
March 31, 2014 | |
| |
| |
|
| |
| | | |
| |
| | |
Monetary financial assets | |
| | | |
| |
| | |
US$ | |
$ | 2,393,922 | | |
US$1=NT$30.47 | |
$ | 72,942,803 | |
US$ | |
| 609,562 | | |
US$1=CNY6.1521 | |
| 18,573,354 | |
JPY | |
| 700,527 | | |
JPY1=NT$0.296 | |
| 207,356 | |
JPY | |
| 7,834,452 | | |
JPY1=US$0.0097 | |
| 2,318,998 | |
| |
| | | |
| |
| | |
Monetary financial liabilities | |
| | | |
| |
| | |
US$ | |
| 2,167,342 | | |
US$1=NT$30.47 | |
| 66,038,911 | |
US$ | |
| 897,340 | | |
US$1=CNY6.1521 | |
| 27,341,950 | |
JPY | |
| 4,134,392 | | |
JPY1=NT$0.296 | |
| 1,223,780 | |
JPY | |
| 7,929,439 | | |
JPY1=US$0.0097 | |
| 2,347,114 | |
| |
| | | |
| |
| | |
December 31, 2014 | |
| | | |
| |
| | |
| |
| | | |
| |
| | |
Monetary financial assets | |
| | | |
| |
| | |
US$ | |
| 3,086,749 | | |
US$1=NT$31.65 | |
| 97,695,606 | |
US$ | |
| 649,271 | | |
US$1=CNY6.119 | |
| 20,549,427 | |
JPY | |
| 3,354,008 | | |
JPY1=NT$0.2646 | |
| 887,471 | |
JPY | |
| 8,787,236 | | |
JPY1=US$0.0084 | |
| 2,325,103 | |
| |
| | | |
| |
| | |
(Continued)
| |
| Foreign Currencies (In Thousand) | | |
Exchange Rate | |
| Carrying Amount (In Thousand) | |
| |
| | | |
| |
| | |
Monetary financial liabilities | |
| | | |
| |
| | |
US$ | |
$ | 2,896,001 | | |
US$1=NT$31.65 | |
$ | 91,658,432 | |
US$ | |
| 976,913 | | |
US$1=CNY6.119 | |
| 30,919,296 | |
JPY | |
| 3,159,712 | | |
JPY1=NT$0.2646 | |
| 836,060 | |
JPY | |
| 8,903,753 | | |
JPY1=US$0.0084 | |
| 2,355,933 | |
| |
| | | |
| |
| | |
March 31, 2015 | |
| | | |
| |
| | |
| |
| | | |
| |
| | |
Monetary financial assets | |
| | | |
| |
| | |
US$ | |
| 3,013,817 | | |
US$1=NT$31.30 | |
| 94,332,472 | |
US$ | |
| 899,483 | | |
US$1=CNY6.1422 | |
| 28,153,818 | |
JPY | |
| 2,990,021 | | |
JPY1=NT$0.2604 | |
| 778,601 | |
JPY | |
| 9,069,796 | | |
JPY1=US$0.0083 | |
| 2,361,775 | |
| |
| | | |
| |
| | |
Monetary financial liabilities | |
| | | |
| |
| | |
US$ | |
| 2,760,153 | | |
US$1=NT$31.30 | |
| 86,392,789 | |
US$ | |
| 1,213,318 | | |
US$1=CNY6.1422 | |
| 37,976,853 | |
JPY | |
| 3,363,106 | | |
JPY1=NT$0.2604 | |
| 875,753 | |
JPY | |
| 9,223,101 | | |
JPY1=US$0.0083 | |
| 2,401,695 | |
(Concluded)
The significant
realized and unrealized foreign exchange gains (losses) were as follows:
| |
For the Three Months Ended March 31, 2014 | |
For the Three Months Ended March 31, 2015 |
Foreign Currencies | |
Exchange Rate | |
| Net Foreign Exchange Gain (Loss) | | |
Exchange Rate | |
| Net Foreign Exchange Gain (Loss) | |
| |
| |
| | | |
| |
| | |
US$ | |
US$1=NT$30.47 | |
$ | 54,818 | | |
US$1=NT$31.30 | |
$ | 63,660 | |
NT$ | |
| |
| (669,505 | ) | |
| |
| 478,250 | |
CNY | |
CNY1=NT$4.9528 | |
| (48,144 | ) | |
CNY1=NT$5.0959 | |
| (33,857 | ) |
| |
| |
| | | |
| |
| | |
| |
| |
$ | (662,831 | ) | |
| |
$ | 508,053 | |
On December 20, 2013, the Kaohsiung
Environmental Protection Bureau (“KEPB”) issued an official letter No. Kao-Shih-Huan-Chu-Tu-Tzu 10243758100 and an
administrative sanction letter No. Kao-Shih-Huan-Chu-Shui-Chu-Tzu 30-102-120022 (“the Administrative Decision”). The
Administrative Decision was to impose a fine of NT$110,065 thousand which has been recorded under the line item of other losses
for the year ended December 31, 2013. On April 7, 2014, the amount of the fine was amended to NT$109,359 thousand by the KEPB.
On January 17, 2014, the Company retained lawyers to file an administrative appeal to nullify the Administrative Decision with
the Kaohsiung City Government, but the administrative appeal was dismissed. The Company next retained lawyers to file an administrative
complaint to revoke the part of the Administrative Decision pertaining to the fine, and the case is being heard by the Kaohsiung
High Administrative Court. Meanwhile, owing to the event above, on January 3, 2014, the Kaohsiung District Prosecutors Office charged
the Company with violation of the Waste Disposal Act and the judgment was handed down on October 20, 2014, in which the Company
was fined NT$3,000 thousand, recorded under the line item of other losses for the year ended December 31, 2014, for violation of
Article 47 of the Waste Disposal Act. The Company filed an appeal against the judgment, and the case is being heard by the Taiwan
High Court's Kaohsiung Branch Court.
| 37. | OPERATING SEGMENTS INFORMATION |
The Group has the following
reportable segments: Packaging, Testing and EMS. The Group packages bare semiconductors into finished semiconductors with enhanced
electrical and thermal characteristics; provides testing services, including front-end engineering testing, wafer probing and final
testing services; provides electronics manufacturing services. Information about other business activities and operating segments
that are not reportable are combined and disclosed in “Others.” The Group engages in other activities such as substrate
production and real estate business.
The accounting policies for
segments are the same as those described in Note 4. The measurement basis for resources allocation and performance evaluation is
based on profit before income tax.
Segment information for the
three months ended March 31, 2014 and 2015 was as follows:
Segment
revenues and results
| |
Packaging | |
Testing | |
EMS | |
Others | |
Adjustment and Elimination | |
Total |
| |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ | |
NT$ |
| |
| |
| |
| |
| |
| |
|
For the three months ended March 31, 2014 | |
| |
| |
| |
| |
| |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Revenue from external customers | |
$ | 26,721,795 | | |
$ | 5,784,611 | | |
$ | 21,365,420 | | |
$ | 827,760 | | |
$ | — | | |
$ | 54,699,586 | |
Inter-segment revenues (Note) | |
| 1,159,620 | | |
| 35,665 | | |
| 9,849,377 | | |
| 1,924,733 | | |
| (12,969,395 | ) | |
| — | |
Segment profit before income tax | |
| 2,199,129 | | |
| 1,159,631 | | |
| 823,153 | | |
| 116,399 | | |
| — | | |
| 4,298,312 | |
Segment assets | |
| 147,704,828 | | |
| 41,426,507 | | |
| 50,653,328 | | |
| 40,051,572 | | |
| — | | |
| 279,836,235 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
For the three months ended March 31, 2015 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Revenue from external customers | |
| 29,320,940 | | |
| 6,179,494 | | |
| 28,300,126 | | |
| 861,598 | | |
| — | | |
| 64,662,158 | |
Inter-segment revenues (Note) | |
| 2,321,374 | | |
| 41,548 | | |
| 13,840,869 | | |
| 1,908,166 | | |
| (18,111,957 | ) | |
| — | |
Segment profit before income tax | |
| 3,113,244 | | |
| 1,439,318 | | |
| 850,120 | | |
| 103,934 | | |
| — | | |
| 5,506,616 | |
Segment assets | |
| 161,566,543 | | |
| 42,655,418 | | |
| 75,160,530 | | |
| 43,107,041 | | |
| — | | |
| 322,489,532 | |
Note:
Inter-segment revenues were eliminated upon consolidation.
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