HTC 2013 Annual Report Download - page 144

FINANCIAL INFORMATION FINANCIAL INFORMATION
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specific requirements prescribed by the board
of directors.
g. For any remainder, the board of directors
should propose allocation ratios based on the
dividend policy set forth in HTC's Articles and
propose them at the stockholders' meeting.
As part of a high-technology industry and as a
growing enterprise, HTC considers its operating
environment, industry developments, and long-
term interests of stockholders as well as its
programs to maintain operating efficiency and
meet its capital expenditure budget and financial
goals in determining the stock or cash dividends
to be paid. HTC's dividend policy stipulates that
at least 50% of total dividends may be distributed
as cash dividends.
No employee bonus was estimated as the
Company reported net loss for the year ended
December 31, 2013. The employee bonus for
2012 should be appropriated at 5% of net income
before deducting employee bonus expenses. If
the actual amounts subsequently resolved by the
stockholders differ from the proposed amounts,
the differences are recorded in the year of
stockholders' resolution as a change in accounting
estimate. If bonus shares are resolved to be
distributed to employees, the number of shares is
determined by dividing the amount of bonus by
the closing price (after considering the effect of
cash and stock dividends) of the shares of the day
immediately preceding the stockholders' meeting.
Under Rule No. 100116 and Rule No. 0950000507
issued by the FSC, an amount equal to the net
debit balance of certain shareholders' equity
accounts shall be transferred from unappropriated
earnings to a special reserve before any
appropriation of earnings generated before
January 1, 2012 shall be made. Any special reserve
appropriated may be reversed to the extent of the
decrease in the net debit balance.
Under Rule No. 1010012865 issued by the FSC on
April 6, 2012 and the directive titled "Questions
and Answers for Special Reserves Appropriated
Following Adoption of IFRSs", on the first-time
adoption of IFRSs, a company should appropriate
in the financial statements for 2012 and 2011,
respectively.
The appropriations of earnings for 2012 were
proposed according to HTC's financial statements
for the year ended December 31, 2012, which were
prepared in accordance with the pre-amended
Guidelines Governing the Preparation of Financial
Reports by Securities Issuers and accounting
principles generally accepted in the Republic
of China, and by reference to the balance sheet
for the year ended December 31, 2012, which
was prepared in accordance with the amended
Guidelines Governing the Preparation of Financial
Reports by Securities Issuers and International
Financial Reporting Standards.
Information on the earnings appropriation and the
bonus to employees, directors and supervisors is
available on the Market Observation Post System
website of the Taiwan Stock Exchange.
Other Equity
December
31, 2013
December
31, 2012
January 1,
2012
Exchange
differences on
translating foreign
operations
$559,719 $(1,089,693) $-
Unrealized (loss)
gains on available-
for-sale financial
assets
(2,021) 9,716 2,939
Cash flow hedge - 194,052 -
$557,698 $(885,925) $2,939
a. Exchange differences on translating foreign
operations
Exchange differences relating to the translation
of the results and net assets of the Company's
foreign operations from their functional
currencies to the Company's presentation
currency (New Taiwan dollars) were recognized
directly in other comprehensive income and
accumulated in the foreign currency translation
reserve. Exchange differences previously
accumulated in the foreign currency translation
reserve were reclassified to profit or loss on the
disposal of the foreign operation.
to a special reserve of an amount that was the
same as these of unrealized revaluation increment
and cumulative translation differences (gains)
transferred to retained earnings as a result of the
company's use of exemptions under IFRS 1. The
Company had a decrease in retained earnings that
resulted from all IFRSs adjustments; therefore, no
special reserve was appropriated.
Appropriation of earnings to legal reserve shall be
made until the legal reserve equals the Company's
capital. Legal reserve may be used to offset deficit. If
the Company has no deficit and the legal reserve has
exceeded 25% of the Company's capital, the excess
may be transferred to capital or distributed in cash.
The appropriations of earnings for 2012 and 2011
had been approved in the shareholders' meetings
on June 21, 2013 and June 12, 2012, respectively.
The appropriations and dividends per share were
as follows:
Appropriation of Earnings Dividends Per
Share (NT$)
For 2012 For 2011
For
2012
For
2011
Legal
reserve
$1,678,097 $6,197,580 $- $-
Special
reserve
(reversal)
854,138 (580,856) - -
Cash
dividends
1,662,454 33,249,085 2 40
Stock
dividends
- - - -
The bonus to employees for 2012 and 2011 approved
in the shareholders' meetings on June 21, 2013 and
June 12, 2012, respectively, were as follows:
Amounts Approved in
Shareholders' Meetings
Amounts Recognized in
Financial Statements
For 2012
Cash
Stock
$976,327
-
$976,327 $976,327
For 2011
Cash
Stock
$7,238,637
-
$7,238,637 $7,238,637
The approved amounts of bonus to employees
were the same as the accrual amounts recognized
b. Unrealized gains or losses on available-for-sale
financial assets
Unrealized gains or losses on available-for-sale
financial assets represents the cumulative gains
and losses arising on the revaluation of AFS
financial assets that have been recognized in
other comprehensive income, net of amounts
reclassified to profit or loss when those assets
have been disposed of or are determined to be
impaired.
c. Cash flow hedge
The cash flow hedging reserve represents the
cumulative effective portion of gains or losses
arising on changes in fair value of hedging
instruments entered into for cash flow hedges.
The cumulative gain or loss arising on changes
in fair value of the hedging instruments that
are recognized and accumulated under the
heading of cash flow hedging reserve will be
transferred to profit or loss only when the
hedged transaction affects the profit or loss,
or included as a basis adjustment to the non-
financial hedged item.
Non-controlling Interest
For the Year Ended December 31
2013 2012
Balance, beginning of
period
$- $992,724
Share of profit
attributable to non-
controlling interests
- 808,218
Decrease in non-
controlling interest due
to losing control of
subsidiary
- (1,648,909)
Non-controlling interest
relating to outstanding
vested share options
held by the employees of
subsidiaries
- (152,033)
Balance, end of period $- $-
Treasury Shares
On August 2, 2013, the Company's board of
directors passed a resolution to buy back 15,000
thousand Company shares from the open market.
The repurchase period was between August 5,
2013 and October 4, 2013, and the repurchase