HTC 2007 Annual Report Download - page 63

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121120
AN OVERVIEW OFTHE COMPANY'S FINANCIAL STATUS
VI
The Company recategorized its financial assets
and liabilities upon adopting SFAS Nos. 34 and
36. As shown below, the adjustments of the
carrying amounts of the financial instruments
categorized as financial assets or financial
liabilities at fair value through profit or loss were
included in the cumulative effect of changes in
accounting principles. On the other hand, the
adjustments made to the carrying amounts of
financial instruments categorized as available-
for-sale financial assets were recognized as
adjustments to stockholders' equity.
As Cumulative EffectAs Adjustments of
of Change in Accounting Stockholders'
Principles (After Tax) Equity (After Tax)
Available-for-sale financial assets $ - $ 48
•The accounting changes had no
m
aterial effect on the
Co
m
pany
'
s financial state
m
ents as of and for the year
ended
D
ece
m
ber 31, 2006.
c. SFAS Nos. 1, 5 and 25
Effective January 1, 2006, the Company
adopted the newly revised SFAS No. 1 -
"Conceptual Framework for Financial
Accounting and Preparation of Financial
Statements," No. 5 - " Long Term Investments
in Equity Securities" and No. 25 - " Business
Combinations - Accounting Treatment under
the Purchase Method," which prescribe that
investment premiums, representing goodwill,
be assessed for impairment at least annually
instead of being amortized. This accounting
change had no material effect on the
Company's financial statements as of and for
the year ended December 31, 2006.
5.CASH
Cash as of December 31, 2005, 2006 and 2007
consisted of the following:
2005 2006 2007
NT$ NT$ NT$ US$(Note 3)
Cash on hand $ 993 $ 1,000 $ 1,000 $ 31
Cash in banks 6,478,555 4,137,988 8,776,552 270,631
Time deposits 9,716,900 30,258,400 46,258,680 1,426,416
$ 16,196,448 $ 34,397,388 $ 55,036,232 $ 1,697,078
•
O
n ti
m
e deposits, interest rates ranged fro
m
1.315% to
1.840%, 1.610% to 2.145% and 1.809% to 4.400%, as of
D
ece
m
ber 31, 2005, 2006 and 2007, respectively.
•
O
n preferential deposits, interest rates ranged fro
m
2.00%
to 4.45%, 2.30% to 5.25% and 3.05% to 4.15% as of
D
ece
m
ber 31, 2005, 2006 and 2007, respectively.
6.
F
INANCIAL ASSETS AND LIABILITIES AT
F
AIR VALUE THROUGH PRO
F
IT OR LOSS
Financial assets and liabilities at fair value through
profit or loss as of December 31, 2005, 2006 and
2007 were as follows:
2005 2006 2007
NT$ NT$ NT$ US$(Note 3)
Derivatives - financial assets
Forward exchange contracts $ 60,085 $ - $ - $ -
Derivatives - financial liabilities
Forward exchange contracts $ - $ 76,470 $ 96,256 $ 2,968
The Company had derivative transactions in
2005, 2006 and 2007 to manage exposures
related to exchange rate fluctuations. However,
these transactions did not meet the criteria for
hedge accounting under Statement of Financial
Accounting Standards No. 34 -" Accounting for
Financial Instruments." Thus, the Company had
no hedge accounting in 2005, 2006 and 2007.
Outstanding forward exchange and currency
option contracts as of December 31, 2005, 2006
and 2007 were as follows:
>
F
orw
a
rd Ex
c
h
a
ng
e
Con
t
r
a
c
t
s
2005
Buy/Sell Currency Settlement Period/ Date Contract Amount
Forward exchange contracts Sell USD/NTD 2006.01.02-2006.01.27 US$ 167,000
Forward exchange contracts Sell EUR/USD 2006.01.02-2006.02.22 EUR 79,000
Forward exchange contracts Sell GBP/USD 2006.01.25 GBP¢G 3,000
2006
Buy/Sell Currency Settlement Period/ Date Contract Amount
Forward exchange contracts Sell USD/NTD 2007.01.05-2007.03.28 US$ 78,000
Forward exchange contracts Sell EUR/USD 2007.01.05-2007.03.09 EUR
C
=108,000
Forward exchange contracts Buy USD/JPY 2007.01.12-2007.03.09 US$ 11,000
Forward exchange contracts Sell GBP/USD 2007.01.05-2007.02.16 GBP£ 6,150
Forward exchange contracts Sell JPY/NTD 2007.01.12-2007.03.28 JP¥ 427,750
Forward exchange contracts Sell JPY/USD 2007.01.17-2007.03.28 JP¥ 810,626
2007
Buy/Sell Currency Settlement Period/ Date Contract Amount
Forward exchange contracts Sell USD/NTD 2008.01.04-2008.01.30 US$ 63,000
Forward exchange contracts Sell EUR/USD 2008.01.09-2008.03.05 EUR
C
=201,500
Forward exchange contracts Buy USD/CAD 2008.01.11-2008.02.22 US$ 5,146
Forward exchange contracts Sell GBP/USD 2008.01.11-2008.01.30 GBP£ 3,725
Forward exchange contracts Sell JPY/NTD 2008.01.09 JP¥ 425,000
•
N
et loss on derivative financial instru
m
ents in 2007 was
N
T$679,996 thousand
(
U
S
$20,968 thousand
)
, consisting of realized
settle
m
ent losses of
N
T$583,740 thousand
(
U
S
$18,000 thousand
)
and valuation losses of
FINANCEI INDEPENDENT AUDITORS' REPORT
l