Asus 2011 Annual Report Download - page 109

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(17) Use of estimates
The preparation of financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect the amounts of
assets and liabilities and the disclosures of contingent assets and liabilities at the date of the
financial statements and the amounts of revenues and expenses during the reporting period.
Actual results could differ from those assumptions and estimates.
(18) Spin-off transaction
The Company resolved to spin off its OEM assets and businesses. The Company adopted
Interpretations (91) 128, (92) 106 and (92) 107 issued by the ARDF to account for its spin-off
transactions. Since the transferee company continues the transferor company’s economic activities,
the Company did not record any gain or loss from the said spin-off transaction but has adjusted
the net assets and long-term equity investment related additional paid-in capital and other equity
account against retained earnings or other components.
(19) Operating segments
In accordance with SFAS No. 41, “Segment reporting”, operating segments are reported in a
manner consistent with the internal reporting provided to the chief operating decision-maker.
3. CHANGES IN ACCOUNTING PRINCIPLES
(1) Notes and accounts receivable and other receivables
Effective January 1, 2011, the Company adopted the amended SFAS No. 34, “Accounting for
Financial Instruments”. Under this standard, a provision for impairment (bad debt) of accounts
and notes receivable and other receivables is established when there is objective evidence that
they are impaired. This change in accounting principle had no significant effect on the net income
for the year ended December 31, 2011.
(2) Operating segments
Effective January 1, 2011, the Company adopted the SFAS No. 41, “Segment Reporting”,
replacing the original SFAS No. 20, “Disclosure of Segment Financial Information”. In
accordance with such standard, the Company restated the segment information for 2010 upon the
first adoption of SFAS No. 41. This change in accounting principle had no significant effect on the
net income and earnings per share for the years ended December 31, 2011 and 2010.
4. DETAILS OF SIGNIFICANT ACCOUNTS
(1) Cash and cash equivalents
2011/12/31 2010/12/31
Petty cash and cash on hand 250$ 264$
Checking and demand deposits 5,677 4,632
Time deposits 16,602,312 25,409,994
16,608,239$ 25,414,890$