Asus 2008 Annual Report Download - page 164

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ASUSTEK COMPUTER INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(In thousands of New Taiwan dollars unless otherwise stated)
 Convertible bonds are subsequently measured at amortized cost. Derivatives with
call/put options and conversion right with clause of adjusting price are recognized as
“financial liabilities at fair value through profit or loss” and are subsequently measured
at the fair value. The movements in the fair value of the derivatives would be
recognized as “gain/(loss) on valuation of financial liabilities”.
 As the bondholder exercises the right to convert the bonds ahead of the due date of
the bonds, the Company shall adjust the book value of the liability components to the
value on the conversion date, which would be the recording basis of common stocks
to be issued without recognizing conversion gain and loss.
 If the bondholder could exercise the put option within one year, the bonds payable
should be reclassified as current liability. Those bonds payable could be reclassified
as long-term liability when the put option expires and the liability meets the definition
of long-term liability.
14. Accrued pension liability
The Company and domestic subsidiaries make monthly contributions to the pension fund at
2% of the total monthly salaries and wages as required by the Labor Standards Laws. The
fund is administrated by the Employees Retirement Fund Committee. The pension fund
mentioned above is considered absolutely separate from the Company and domestic
subsidiaries after contributed; therefore, it is not included in the accompanying financial
statements.
The Company and domestic subsidiaries adopt, on a prospective basis, the R.O.C. SFAS No.
18 “Accounting for Pensions”. This Statement requires that the accumulated pension
obligation and the pension expense be determined on an actuarial basis. However, except
for few foreign employees, the Company has closed out all seniority of employees as of
December 31, 2007.
For employees subject to the Labor Pension Act of the R.O.C. (“the Labor Pension Act”),
which prescribes a defined contribution scheme, the Company and domestic subsidiaries
make monthly contributions to the employees’ individual pension accounts on a basis no less
than 6% of the employees’ monthly salaries.