Acer 2005 Annual Report Download - page 77

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- 72 -
(7) Receivables from and payables to related parties referred to above are summarized below:
December 31, 2004 December 31, 2005
NT$ NT$ US$
Receivables:
Notes and accounts receivable 1,351,451 6,040,397 183,962
Loans to related parties 31,917 - -
Other receivables 16,834 36,635 1,116
Receivables resulting from assets
spun off
1,023,388 687,867 20,949
2,423,590 6,764,899 206,027
Payables:
Notes and accounts payable 3,126,267 8,598,247 261,862
Other payables 227,541 73,366 2,234
3,353,808 8,671,613 264,096
6. Pledged Assets
Assets pledged for various purposes are summarized as follows:
Book value of pledged assets
at December 31,
Pledged assets Pledged to secure 2004 2005
NT$ NT$ US$
Cash in bank and time deposits Deposits for contract bidding
projects fulfillment
211,482 158,466 4,826
Accounts receivable Stand-by letters of credit 302,664 394,921 12,027
Inventory Stand-by letters of credit 206,934 517,859 15,772
Short-term and long-term
equity investments
Bonds payable and long-term
debt
6,612,573
604,265
18,403
Property and equipment, and
property not used in operation
Long-term and short-term debt
2,765,272
2,210,692
67,327
Total 10,098,925 3,886,203 118,355
As of December 31, 2004 and 2005, a portion of the above pledged time deposits amounting to
NT$139,551 and NT$140,040, respectively, were classified as “other financial assets” in the
accompanying consolidated balance sheets. The remaining balance was classified as “pledged
time deposits”.
7. Commitments and Contingencies
(a) Royalties
The Company renewed the Patent Cross License with IBM in October 2003. The license
period is 5 years. The license mainly states that both parties have the rights to make use of
either party’ s global technological patents to manufacture and sell personal computer products.
The Company agrees to make fixed payments periodically to IBM, and the Company will not
have additional obligation for the use of IBM patents other than the fixed amounts of
payments agreed upon.
In June 2004, the Company and Lucent Technologies Inc. extended the Patent Cross License
to December 31, 2007. During the aforementioned period, the Company only pays the
amounts according to the contract when manufacturing and selling computer products for
which Lucent holds related patents. No additional royalties are required. The essence of
the license authorizes both parties to use each other’ s worldwide computer-related patents for
manufacturing and selling personal computer products.