Acer 2008 Annual Report Download - page 51

Acer Incorporated 2008 Annual Report98
Financial Standing
Acer Incorporated 2008 Annual Report 99
Accrued pension liabilities are included in “other liabilities” in the accompanying consolidated balance
sheets. Prepaid pension cost is included in “other assets” in the accompanying consolidated balance sheets.
The components of the net periodic pension cost for 2007 and 2008 were as follows:
2007 2008
NT$ NT$ US$
Service cost 32,894 49,808 1,518
Interest cost 20,671 34,453 1,050
Actual return on plan assets (12,147) (18,586) (566)
Amortization and deferral 17,133 31,937 973
Net periodic pension cost 58,551 97,612 2,975
Signicant actuarial assumptions used in the above calculations were as follows:
2007 2008
Discount rate 2.75% 2.50%
Rate of increase in future compensation 3.00%-3.50% 3.00%
Expected rate of return on plan assets 2.75% 2.50%
In 2007 and 2008, pension cost under the dened contribution retirement plans amounted to NT$202,278 and
NT$367,627, respectively.
(19) Income taxes
(a) Each consolidated entity should le its own separate income tax return.
(b) The components of income tax expense from continuing operations for the years ended December 31,
2007 and 2008, were as follows:
2007 2008
NT$ NT$ US$
Current income tax expense 2,726,875 2,383,360 72,623
Deferred income tax (benet) expense (61,297) 786,086 23,953
2,665,578 3,169,446 96,576
(c) The income tax calculated on the pre-tax income from continuing operations at the Company’s statutory
income tax rate (25%) was reconciled with the income tax expense of continuing operations reported in
the accompanying consolidated statements of income as follows:
2007 2008
NT$ NT$ US$
Expected income tax expense 3,777,159 3,701,682 112,794
Effect of different tax rates applied to the
Company’s subsidiaries 1,786,743 720,278 21,948
Tax-exempt investment income from domestic investees (592,587) (154,526) (4,709)
Prior-year adjustments (53,756) (458,487) (13,971)
Gain on disposal of marketable securities not
subject to income tax (1,226,553) (697,934) (21,267)
Investment tax credits 30,696 295,939 9,018
Change in valuation allowance (699,088) 225,493 6,871
Tax-exempt investment income resulting from
operational headquarters
(1,132,967) (1,386,033) (42,234)
Surtax on unappropniated retained earrings - 165,109 5,031
Gain on disposal of land not subject to income tax (29,476) - -
Alternative minimum tax 404,858 44,430 1,354
Others 400,549 713,495 21,741
Income tax expense 2,665,578 3,169,446 96,576
(d) The components of deferred income tax assets (liabilities) as of December 31, 2007 and 2008, were as
follows:
December 31, 2007 December 31, 2008
NT$ NT$ US$
Deferred income tax assets – current:
Accrued purchase discounts 631,360 1,093,887 33,332
Inventory provisions 394,505 620,737 18,915
Loss on valuation of nancial instruments 338,995 156,932 4,782
Accrued advertising expense 293,552 181,323 5,525
Warranty provision 267,102 894,085 27,244
Allowance for doubtful accounts 169,001 397,292 12,106
Accrued restructuring cost 149,637 - -
Accrued non-recurring engineering cost 102,485 111,826 3,407
Deferred revenue 40,742 34,904 1,064
Accrued royalty 707,937 82,975 2,528
Unrealized exchange gains (201,717) (386,944) (11,791)
Net operating loss carryforwards - 77,977 2,376
Others 571,195 553,783 16,874
3,464,794 3,818,777 116,362
Valuation allowance (1,550,788) (1,535,834) (46,798)
1,914,006 2,282,943 69,564