HTC 2015 Annual Report Download - page 112

Financial information
Financial information
220
221
23. NET (LOSS) PROFIT FROM
CONTINUING OPERATIONS AND
OTHER COMPREHENSIVE INCOME
AND LOSS
a. Other income
For the Year Ended
December 31
2015 2014
Interest income - bank deposits $ 179,328 $214,092
Others 108,172 178,669
$287,500 $392,761
b. Other gains and losses
For the Year Ended
December 31
2015 2014
Net loss on disposal of property,
plant and equipment $( 33) $ -
Gains on disposal of investments 327 -
Net foreign exchange (loss) gain ( 291,550) 50,904
Net gains arising on financial
instruments classified as held
for trading 58,949 240,120
Ineffective portion of cash flow
hedge 1,258 1,939
Impairment losses ( 1,792,890) (174,253)
Other losses ( 42,415) ( 32,901)
$(2,066,354) $ 85,809
Gain or loss on financial assets and liabilities held for
trading was derived from forward exchange transactions.
The Company entered into forward exchange
transactions to manage exposures related to exchange
rate fluctuations of foreign currency denominated assets
and liabilities.
In June 2015, the Company determined that the
recoverable amount of partial prepayments and
operation equipment were less than its carrying amount,
and thus recognized an impairment loss of NT$1,268,643
thousand and NT$524,247 thousand, respectively.
c. Depreciation and amortization
For the Year Ended
December 31
2015 2014
Property, plant and equipment $ 1,579,960 $ 1,774,782
Intangible assets 682,553 649,887
$2,262,513 $ 2,424,669
Classification of depreciation -
by function
Operating costs
Operating expenses
$ 805,766
774,194
$ 967,355
807,427
$ 1,579,960 $ 1,774,782
Classification of amortization -
by function
Operating costs
Operating expenses
$ -
682,553
$ -
649,887
$ 682,553 $ 649,887
d. Employee benefits expense
For the Year Ended
December 31
2015 2014
Short-term benefits $ 9,261,843 $10,493,645
Post-employment benefits
(Note 20)
Defined contribution plans
Defined benefit plans
353,469
5,595
$ 381,930
6,595
359,064 388,525
Share-based payments
(Note 26)
Equity-settled share-based
payments 513,002 244,346
Total employee benefits
expense $ 10,133,909 $ 11,126,516
Classification - by function
Operating costs $ 3,270,958 $ 4,413,610
Operating expenses 6,862,951 6,712,906
$ 10,133,909 $ 11,126,516
The existing Articles of Incorporation of the Company
stipulate to distribute bonus to employees and
remuneration to directors and supervisors at the rates
no less than 5% and no higher than 0.3%, respectively,
of net income (net of the bonus and remuneration).
The employee bonus for the year ended December
31, 2014 should be appropriated at 5% of net income
before deducting employee bonus expenses. To be in
compliance with the Company Act as amended in May
2015, the Company expects to modify the Articles of
Incorporation according to laws and regulations above
on the board of directors' meeting on February 29, 2016,
which stipulate to distribute employees' compensation
and remuneration to directors and supervisors at
the rates no less than 4% and no higher than 0.25%,
respectively, of net profit before income tax, employees'
compensation, and remuneration to directors and
supervisors. No employee bonus was estimated as the
Company reported net loss for the year ended December
31, 2015. Material differences between such estimated
amounts and the amounts proposed by the board of
directors on or before the date the annual financial
statements are authorized for issue are adjusted in the
year the bonus and remuneration were recognized. If
there is a change in the proposed amounts after the
annual financial statements were authorized for issue,
the differences are recorded as a change in accounting
estimate.
The appropriations of bonuses to employees for 2014
and 2013 have been approved in the shareholders'
meetings on June 2, 2015 and June 19, 2014, respectively,
were as follows:
For the Year Ended December 31
2014 2013
Cash
Dividends
Share
Dividends
Cash
Dividends
Share
Dividends
Bonus to
employees $88,334 $ - $ - $ -
There was no difference between the amounts of the
bonus to employees approved in the shareholders'
meetings on June 2, 2015 and June 19, 2014 and the
amounts recognized in the financial statements for the
years ended December 31, 2014 and 2013, respectively.
e. Impairment losses on non-financial assets
For the Year Ended
December 31
2015 2014
Inventories (included in
operating costs) $2,150,302 $557,580
Property, plant and equipment
(included in other gains and
losses) 524,247 -
For the Year Ended
December 31
2015 2014
Investments accounted for by
the equity method (included in
other gains and losses) $ - $174,253
Prepaid expenses (including in
other gains and losses) 1,268,643 -
$3,943,192 $731,833
(Concluded)
f. Gain or loss on foreign currency exchange
For the Year Ended
December 31
2015 2014
Foreign exchange gains $ 7,445,466 $7,201,630
Foreign exchange losses (7,737,016) (7,150,726)
$( 291,550) $ 50,904
24. INCOME TAXES RELATING TO
CONTINUING OPERATIONS
a. Income tax (benefit) expense recognized in
profit or loss
For the Year Ended
December 31
2015 2014
Current tax
In respect of the current period $ 211 $44,578
Adjustments for prior periods ( 2,451) -
( 2,240) 44,578
Deferred tax
In respect of the current period ( 1,246,236) 3,591
Income tax (benefit) expense
recognized in profit or loss $( 1,248,476) $ 48,169
The income tax (benefit) expense for the years ended
December 31, 2015 and 2014 can be reconciled to the
accounting (loss) profit as follows:
For the Year Ended
December 31
2015 2014
(Loss) profit before income tax $(16,781,544) $ 1,531,215
Income tax calculated at 17% ( 2,852,862) 260,306
(Continued)
(Continued)