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94
HYUNDAI MOTOR COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2005 AND 2004
Amortization on intangible assets except negative goodwill is recorded in selling and administrative expenses and
manufacturing cost, and amortization on negative goodwill is recorded in other income. In addition, the Company accounted
for ordinary development expenses, research expenses and impairment loss as manufacturing cost, selling and administrative
expenses and other expenses, respectively.
In 2004, due to the decline of the recoverable amount of cost in excess of fair value of net identifiable assets acquired, which the
Company recognized at the time of merging the Automobile Division and Machine Tool Division of Hyundai MOBIS (Formerly
Hyundai Precision and Industry Co., Ltd.), the carrying amount of cost in excess of fair value of net identifiable assets acquired,
amounting to ￦461,107 million (US$455,190 thousand), is accounted for as impairment loss and charged to current operations.
Description Goodwill Negative Industrial Development Other Total Total
goodwill property costs
rights
Beginning of the year ￦459,982 ￦(72,313) ￦20,779 ￦1,326,312 ￦77,735 ￦1,812,495 $1,789,235
Addition:
Expenditures 33,828 (23,016) 11,242 1,634,762 17,830 1,674,646 1,653,155
Deduction:
Disposal - - - (20) (20) (20)
Amortization (10,950) 8,709 (8,133) (380,679) (13,478) (404,531) (399,340)
Research - - - (620,621) - (620,621) (612,656)
Ordinary development - - - (108,726) - (108,726) (107,331)
Impairment loss - - - (7,772) (87) (7,859) (7,758)
Other (6,517) 199 1,024 (911) 3,011 (3,194) (3,153)
Government subsidy (12,068) (12,068) (11,913)
End of the year ￦476,343 ￦(86,421) ￦24,912 ￦1,830,297 ￦84,991 ￦2,330,122 $2,300,219
Korean Won
(In millions)
Translation into
U.S. Dollars
(Note 2)
(In thousands)
10. INTANGIBLES:
Intangibles as of December 31, 2005 and 2004 consist of the following:
Description Acquisition Accumulated Accumulated Government Book value Book value Book value Book value
cost amortization Impairment subsidy
loss
Goodwill ￦517,062 ￦(40,719) ￦-￦-￦476,343 ￦459,982 $470,230 $454,079
Negative goodwill (90,656) 4,235 - - (86,421) (72,313) (85,312) (71,385)
Industrial property
rights 59,549 (34,637) - - 24,912 20,779 24,592 20,512
Development costs 3,289,789 (1,439,361) (8,063) (12,068) 1,830,297 1,326,312 1,806,808 1,309,291
Other 148,218 (60,926) (2,301) - 84,991 77,735 83,900 76,737
￦3,923,962 ￦(1,571,408) ￦(10,364) ￦(12,068) ￦2,330,122 ￦1,812,495 $2,300,219 $1,789,235
The changes in intangibles in 2005 are as follows:
Korean Won
(In millions)
Translation into
U.S. Dollars (Note 2)
(In thousands)
2005 2004 2005 2004
93
HYUNDAI MOTOR COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2005 AND 2004
The changes in property, plant and equipment in 2005 are as follows:
Korean Won
(In millions)
Translation into
U.S. Dollars
(Note 2)
(In thousands)
Beginning Acquisition Transfer Disposal Depreciation Other End of End of
of year changes year year
Land ￦4,084,137 ￦107,891 ￦(8,989) ￦(12,398) ￦(1,864) ￦(3,597) ￦4,165,180 $4,111,728
Buildings
and structures 5,394,729 159,638 402,743 (76,626) (247,781) 93,121 5,725,824 5,652,344
Machinery
and equipment 6,414,214 271,770 1,353,217 (211,054) (1042,179) 173,900 6,959,868 6,870,551
Vehicles 117,640 41,040 22,919 (17,391) (35,796) 2,059 130,471 128,797
Tools, dies
and molds 1,173,557 78,904 394,470 (14,897) (459,094) 72,513 1,245,453 1,229,470
Other equipment 666,730 137,272 3,367 (13,336) (298,915) 53,441 548,558 541,517
Construction
in progress 1,951,279 3,091,895 (2,167,727) (307,108) - 104,345 2,672,685 2,638,386
￦19,802,286 ￦3,888,410 ￦-￦(652,810) ￦(2,085,629) ￦495,782 ￦21,448,039 $21,172,793
As of December 31, 2005 and 2004, the value of the land, which the Company and its subsidiaries own domestically, totals
￦4,189,062 million (US$4,135,303 thousand) and ￦3,915,257 million (US$3,865,012 thousand), respectively, in terms of land
prices officially announced by the Korean government.