HTC 2013 Annual Report Download - page 142

FINANCIAL INFORMATION FINANCIAL INFORMATION
280 281
20. OTHER LIABILITIES
December 31,
2013
December 31,
2012
January 1,
2012
Other payables
Accrued
expenses
$36,999,785 $37,469,944 $46,270,611
Payables for
purchase of
equipment
815,774 1,471,529 812,240
Others 217,440 325,700 512,940
$38,032,999 $39,267,173 $47,595,791
Other current
liabilities
Advance receipts $529,470 $637,657 $574,596
Agency receipts 259,529 301,868 440,862
Others 167,128 848,581 645,682
$956,127 $1,788,106 $1,661,140
Accrued Expenses
December
31, 2013
December
31, 2012
January 1,
2012
Marketing $22,592,673 $20,872,536 $29,104,665
Salaries and
bonuses
5,757,389 5,712,741 3,532,970
Bonus to
employees
3,278,053 5,712,075 7,238,637
Services 1,780,205 1,020,609 1,324,631
Materials
and molding
expenses
1,650,934 1,904,181 1,854,932
Import, export
and freight
647,588 644,432 1,397,747
Repairs,
maintenance
and sundry
purchase
237,463 573,355 466,135
Others 1,055,480 1,030,015 1,350,894
$36,999,785 $37,469,944 $46,270,611
The Company accrued marketing expenses on the
basis of related agreements and other factors that
would significantly affect the accruals.
Other Payables - Others
Other payables - others were payables for patents,
and agreed installments payable to the original
stockholders of subsidiaries.
21. PROVISIONS
December 31,
2013
December 31,
2012
January 1,
2012
Warranty
provision
$7,376,035 $8,058,509 $13,080,394
Provisions for
contingent loss
on purchase
orders
832,850 823,005 2,052,881
$8,208,885 $8,881,514 $15,133,275
Movement of provisions for the years ended
December 31, 2013 and 2012 were as follows:
2013
Warranty
Provision
Provisions
for
Contingent
Loss on
Purchase
Orders Total
Balance, beginning
of the year
$8,058,509 $823,005 $8,881,514
Provisions
recognized
13,945,001 359,350 14,304,351
Amount utilized
during the year
(14,789,263) (349,505) (15,138,768)
Translation
adjustment
161,788 - 161,788
Balance, end of
the year
$7,376,035 $832,850 $8,208,885
2012
Warranty
Provision
Provisions
for
Contingent
Loss on
Purchase
Orders Total
Balance, beginning
of the year
$13,080,394 $2,052,881 $15,133,275
Provisions
recognized
10,363,279 - 10,363,279
Reversing un-
usage balances
- (751,363) (751,363)
Amount utilized
during the year
(15,156,357) (478,513) (15,634,870)
Translation
adjustment
(228,807) - (228,807)
Balance, end of
the year
$8,058,509 $823,005 $8,881,514
The Company provides warranty service for its
customers for one year to two years. The warranty
liability is estimated on the basis of evaluation
of the products under warranty, past warranty
experience, and pertinent factors.
The provision for contingent loss on purchase
orders is estimated after taking into account
the effects of changes in the product market,
evaluating the foregoing effects on inventory
management and adjusting the Company's
purchases.
22. RETIREMENT BENEFIT PLANS
Defined Contribution Plans
The pension plan under the Labor Pension
Act (the "LPA") is a defined contribution plan.
Based on the LPA, HTC and Communication
Global Certification Inc. ("CGC") make monthly
contributions to employees' individual pension
accounts at 6% of monthly salaries and wages.
The Company has defined contribution retirement
benefit plans for all qualified employees of HTC
and CGC in Taiwan. Besides, the employees of
the Company's subsidiary are members of a
state-managed retirement benefit plan operated
by local government. The subsidiary is required
to contribute amounts calculated at a specified
percentage of payroll costs to the retirement
benefit scheme to fund the benefits. The only
obligation of the Company with respect to the
retirement benefit plan is to make the specified
contributions to the fund.
The total expenses recognized in the consolidated
statement of comprehensive income were
NT$786,658 thousand and NT$665,765 thousand,
representing the contributions payable to these
plans by the Company at the rates specified
in the plans for the years ended December 31,
2013 and 2012, respectively. As of December 31,
2013, December 31, 2012 and January 1, 2012, the
amounts of contributions payable were NT$109,323
thousand, NT$119,833 thousand and NT$123,877
thousand, respectively, the amounts were paid
subsequent to the end of the reporting period.
Defined Benefit Plans
Based on the defined benefit plan under the
Labor Standards Law ("LSL"), pension benefits are
calculated on the basis of the length of service and
average monthly salaries of the six months before
retirement. HTC and CGC contributed amounts
equal to 2% of total monthly salaries and wages
to a pension fund administered by the pension
fund monitoring committee. The pension fund is
deposited in Bank of Taiwan in the committee's
name.
The actuarial valuations of plan assets and the
present value of the defined benefit obligation
were carried out by qualifying actuaries. The
principal assumptions used for the purposes of the
actuarial valuations were as follows:
December 31,
2013
December 31,
2012
January 1,
2012
Discount rates 1.625%-
1.875%
1.250%-
1.625%
1.500%-
1.750%
Expected return
on plan assets
2.000% 1.875% 2.000%
Expected
rates of salary
increase
2.250%-
4.000%
2.250%-
4.000%
2.250%-
4.000%
Amounts recognized in profit or loss in respect of
these defined benefit plans were as follows:
For the Year Ended December 31
2013 2012
Current service cost $4,599 $5,600
Interest cost 6,408 6,684
Expected return on
plan assets
(9,885) (9,918)
$1,122 $2,366
Operating cost $301 $644
Selling and
marketing
89 717
General and
administrative
126 262
Research and
development
606 743
$1,122 $2,366