Asus 2011 Annual Report Download - page 142

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ASUSTEK COMPUTER INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2011 AND 2010
(EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS,
EXCEPT AS OTHERWISE INDICATED)
1. HISTORY AND ORGANIZATION
(1) ASUSTEK COMPUTER INC. (ASUS or the Company) was established on April 2, 1990. The
Company’s common shares are listed on the Taiwan Stock Exchange (TSE) on November 14, 1996.
Its main activities are to produce, design and sell notebook PCs, main boards, software, add-on
cards, optics, wired and wireless communication equipment and telecom-restricted radio frequency
devices.
(2) The Company resolved to spin-off its OEM businesses on January 1, 2008. Pursuant to the
Company’s resolution, the Company transferred its computer and non-computer OEM businesses to
its spun-off subsidiaries PEGA and UNIHAN, respectively. On June 1, 2010, however, the
Company transferred further its OEM assets and business (the Company’s long-term equity
investment in PEGA) to the Company’s another investee, PII. PII issued new shares to the
Company and its shareholders as consideration.
(3) The Group’s headcount totaled 21,361 and 18,850 as of December 31, 2011 and 2010, respectively.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements are prepared in accordance with the “Regulations Governing the Preparation
of Financial Reports by Securities Issuers” and generally accepted accounting principles in the
Republic of China. The Group’s significant accounting policies are as follows:
(1) Basis of consolidation
A. When the Group holds more than 50% of the voting rights of investees (including the
exercisable and convertible potential voting rights owned by the Group, except when there is
any evidence indicating that the Group has no controlling power from their percentage of
ownership) or when any one of the criteria listed below is met, the Group is considered to
have control over the investees.The Group not only accounts for such investments under the
equity method, but also consolidates them into the Group’s consolidated financial statements
quarterly.
(A) Control over more than half of the voting rights by virtue of an agreement with other
investors.
(B) Power to govern the financial, operating and personnel policies of the entity under a
statute or an agreement.
(C) Power to appoint or remove more than half of the members of the board of directors (or
its equivalent) and control of the entity is by that board (or its equivalent).