Asus 2015 Annual Report Download - page 188

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E. Current income tax assets and liabilities are offset and the net amount is reported in the
balance sheets when there is a legally enforceable right to offset the recognized amounts and
there is an intention to settle on a net basis or realize the asset and settle the liability
simultaneously. Deferred income tax assets and liabilities are offset on the balance sheets
when the entity has the legally enforceable right to offset current tax assets against current tax
liabilities and they are levied by the same taxation authority on either the same entity or
different entities that intend to settle on a net basis or realize the asset and settle the liability
simultaneously.
F. A deferred tax asset shall be recognized for the carryforward of unused tax credits resulting
from research and development expenditures to the extent that it is possible that future taxable
profit will be available against which the unused tax credits can be utilized.
(30) Dividends
Dividends are recorded in the Company’s financial statements in the period in which they are
approved by the Company’s shareholders. Cash dividends are recorded as liabilities; stock
dividends are recorded as stock dividends to be distributed and are reclassified to ordinary shares
on the effective date of new shares issuance.
(31) Revenue recognition
Sales of goods
A. The Group is primarily engaged in the selling of 3C products. Revenue is measured at the fair
value of the consideration received or receivable taking into account value-added tax, returns,
rebates and discounts for the sale of goods to external customers in the ordinary course of the
Group’s activities. Revenue arising from the sales of goods is recognized when the Group has
delivered the goods to the customer, the amount of sales revenue can be measured reliably
and it is probable that the future economic benefits associated with the transaction will flow
to the entity. The delivery of goods is completed when the significant risks and rewards of
ownership have been transferred to the customer, the Group retains neither continuing
managerial involvement to the degree usually associated with ownership nor effective control
over the goods sold, and the customer has accepted the goods based on the sales contract or
there is objective evidence showing that all acceptance provisions have been satisfied.
B. The Group offers customers volume discounts and right of return for defective products. The
Group estimates such discounts and returns based on historical experience. Provisions for
such liabilities are recorded when the sales are recognized. The volume discounts are
estimated based on the anticipated annual sales quantities.
(32) Business combinations
A. The Group uses the acquisition method to account for business combinations. The
consideration transferred for an acquisition is measured as the fair value of the assets
transferred, liabilities incurred or assumed and equity instruments issued at the acquisition
date, plus the fair value of any assets and liabilities resulting from a contingent consideration