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Acer Incorporated 2008 Annual Report94
Financial Standing
Acer Incorporated 2008 Annual Report 95
The ETEN trademark for the stock trading PDA product has an indenite life and, accordingly, is not
subject to amortization. The customer relationship is subject to amortization using the straight-line
method over 7 years. The developed technology is subject to amortization using the straight-line method
over 10 years, the estimated period in which the economic benets will be consumed.
(b) Pro forma information
The following unaudited pro forma financial information presents the combined results of operations
as if the acquisitions of Gateway Inc., Packard Bell B.V., and E-Ten Information Systems Co., Ltd. had
occurred as of the beginning of each of the scal years presented:
2007 2008
NT$ NT$ US$
Revenue 574,749,174 550,172,239 16,764,344
Net income from continuing operations before income tax 17,498,019 14,676,395 447,206
Net income from continuing operations after income tax 14,343,978 11,521,166 351,062
Basic earnings per common share (in dollars) 5.72 4.44 0.14
(c) Impairment test
For the purpose of impairment testing, goodwill and trademarks and trade names with indenite useful
lives are allocated to the Consolidated Companies’ cash-generating units (CGUs). The carrying amounts
of signicant goodwill and trademarks and trade names with indenite useful lives as of December 31,
2007 and 2008, are presented as follows:
December 31, 2007
Acer Pan-America
business group
Packard Bell brand
business group
E-Ten Information
System group
Goodwill $ 16,654,264 -166,604
Trademarks
& trade names 4,930,120 - -
December 31, 2008
Acer Pan-America
business group
Packard Bell brand
business group
E-Ten Information
System group
Goodwill $ 18,768,929 1,699,593 1,901,821
Trademarks
& trade names 4,988,336 2,067,836 450,900
Each CGU to which the goodwill is allocated represents the lowest level within the Consolidated
Companies at which the goodwill is monitored for internal management purposes. Based on the results
of impairment tests conducted by the Company’s management, there was no evidence of impairment of
goodwill and trademarks and trade names as of December 31, 2007 and 2008. The recoverable amount of
a CGU is determined based on the value in use, and the related key assumptions are as follows:
Acer Pan-America business group
(i) dgets approved by management covering a 5-year period, and a stable growth rate of 3% for the
future earnings potential of the CGU beyond ve years. This expected growth rate is determined by
the assumptions concerning the overall economic environment and introduction of new products.
(ii) Future cash ows are discounted at the rate of 13.7 percent.
Packard Bell brand business group
(i) The assessment used cash ow projections based on historical operating performance, future nancial
budgets approved by management covering a 5-year period, and a stable growth rate of 2% for the
future earnings potential of the CGU beyond ve years. This expected growth rate is determined by
the assumptions concerning the overall economic environment and introduction of new products.
(ii) Future cash ows are discounted at the rate of 11.8 percent.
E-Ten Information System group
(i) The assessment used cash ow projections based on historical operating performance, future nancial
budgets approved by management covering a 5-year period, and a stable growth rate of 3% for the
future earnings potential of the CGU beyond ve years. This expected growth rate is determined by
the assumptions concerning overall the economic environment and introduction of new products.
(ii) Future cash ows are discounted at the rate of 18.7 percent.
(15) Other nancial assets ‒ noncurrent
December 31, 2007 December 31, 2008
NT$ NT$ US$
Refundable deposits 687,109 781,080 23,800
Noncurrent receivables 274,284 87,680 2,672
961,393 868,760 26,472
(16) Short-term borrowings
December 31, 2007 December 31, 2008
NT$ NT$ US$
Bank loans 5,372,109 1,086,851 33,117
The Consolidated Companies provided some assets as collateral according to the bank loan contracts. Refer
to note 6 for a description of pledged assets related to these borrowings.