Acer 2005 Annual Report Download - page 68

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ICA to maintain a record of the corporate income taxes paid and imputation credit that can
be allocated to each resident stockholder. The credit available to the ROC resident
stockholders is calculated by multiplying the dividend with the creditable ratio. The
creditable ratio is calculated by dividing the balance of the ICA by earnings retained since
January 1, 1998.
The non-resident stockholders are not eligible for the imputation credit. However, the
10% income surtax paid on any unappropriated earnings for the years following December
31, 1997, can be offset with the dividend withholding tax for non-resident stockholders
upon distribution of such earnings to such stockholders. As of December 31, 2004 and
2005, the information related to the integrated tax system was as follows:
Unappropriated earnings:
December 31, 2004 December 31, 2005
NT$ NT$ US$
Before January 1, 1998 18,106 6,776 206
From January 1, 1998 7,011,661 8,477,502 258,185
7,029,767 8,484,278 258,391
Balance of ICA 79,800 104,732 3,190
The Company’ s estimated creditable ratio for 2005 earnings distribution to domestic
stockholders is approximately 1.23% ; and the actual creditable ratio for 2004 earnings
distribution to domestic stockholders is 1.79% .
(i) The ROC income tax authorities have examined and assessed the income tax returns of the
Company for all fiscal years through 2001, and have examined and assessed the income
tax returns of Acer Sertek Inc. for all fiscal years through December 31, 2002. for the
fiscal year 2001 and 2002 of Acer Sertek Inc., the Company is filing a appeal toward the
tax authorities for some adjustment made by the tax authorities..
(15) Stockholders’ Equity
(a) Common stock
As of December 31, 2004 and 2005, the Company’ s authorized common stock consisted of
2,800,000,000 shares, of which 2,093,367,679 shares and 2,254,518,705 shares, respectively,
were issued and outstanding. The par value of the Company’ s common stock is NT$10
per share.
The Company’ s shareholders resolved to appropriate NT$2.5 per share from retained
earnings as of December 31, 2003, as cash dividends in the meeting on June 17, 2004.
Such cash dividends amounted to NT$4,925,285. The shareholders also resolved to
appropriate NT$940,008 from retained earnings and NT$492,529 from capital surplus for a
total of 143,254,000 new shares as stock dividends and employee bonuses. The stock
issuance was authorized by and registered with the governmental authorities.
The Company’ s shareholders resolved to appropriate NT$2.3 per share from retained
earnings as of December 31, 2004, as cash dividends in the meeting on June 14, 2005.
Such cash dividends amounted to NT$4,814,746. The shareholders also resolved to
appropriate NT$606,694 from retained earnings and NT$1,004,816 from capital surplus for
a total of 161,151,000 new shares as stock dividends and employee bonus. The stock
issuance was authorized by and registered with the governmental authorities.
(b) Treasury stock
As of March 27, 2002, AI had repurchased its own stock amounting to NT$3,212,739,
representing 152,000,000 shares, for implementing its employee stock option plan in
accordance with SFC regulations. This treasury stock was converted into 60,800,000
shares of the Company’ s common stock issued for the merger. According to SFC
regulations, treasury stock for the purpose of the employee stock option plan should be
transferred to qualified employees within three years from the date of repurchase. The
Company should reregister those treasury shares not transferred within the regulated period,