Kia 2001 Annual Report Download - page 32
Download and view the complete annual report
Please find page 32 of the 2001 Kia annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Financial Statements & Notes
60 61
stock. Also, on December 28, 1998, the Hyundai Motor Consortium acquired rights up to the extent that
the Consortium shall own up to 51 percent of all the additional preferred shares to be issued. These pre-
emptive rights can be exercised at once or several times in the fifth or tenth year from December 28,
1999, the date the court finally approved the reorganization plan, and the Company shall pay the divi-
dend equal to at least 2 percent for the preferred shares to be issued for the exercise of the rights. In
addition, the Asia Motors-invested financial institutions and Hyundai Motor Consortium were granted pre-
emptive rights under the same conditions as described above.
Capital surplus as of December 31, 2001 and 2000 consist of the following:
As a result of the capital reduction on February 2, 1999, the Company recognized the gain in capital sur-
plus in the amount of 340,848 million ($257,030 thousand). In 2001, the Company accounted for the
loss from the stock retirement amounting to 220,989 million ($166,646 thousand) as a charge against
the gain on capital reduction.
The dispositions of the Company's accumulated deficit through December 31, 2001 are summarized below:
The appraisal gain of 1,047,040 million ($789,563 thousand) arising from the Company's assets reval-
uation at January 1, 1999 in accordance with the Asset Revaluation Law of Korea was offset against
accumulated deficit.
Capital adjustments as of December 31, 2001 and 2000 consist of the following:
(1) Treasury stock
As of December 31, 2001 and 2000, the Company has 1,628,048 shares and 37,840,838 shares of
treasury stock, respectively, arising mainly from acquisition for the stock retirement purposes as dis-
cussed in Note 12 and cross-holdings of investment equity securities due to mergers, and has recorded,
in capital adjustments, treasury stock at book value as of those dates, respectively.
(2) Stock options
The Company granted 71 directors stock options (grant date: March 17, 2000, exercise date: March 17,
2003, expiry date: March 18, 2008), at an exercise price of 5,500 ($4.15) as determined during the
meeting of the shareholders on March 17, 2000. If all of the stock options, which require at least two-year
continued service, are exercised, 1,165,000 new shares or shares held as treasury stock will be granted
in accordance with the decision of the Board of Directors. The Company calculates the total compensa-
tion expense using an option-pricing model. In the model, the risk-free rate of 10.0 percent, an expected
exercise period of 5.5 years and an expected variation rate of stock price of 0.8387 are used. Total com-
pensation expense amounts to 4,581 million ($3,454 thousand) and to be accounted for as a charge
to current operations and a credit to capital adjustment over the required period of service from the grant
date using the straight-line method.
In 1999, the Company and Asia Motors asked the Korean tax authorities to reassess the accumulated
tax loss carry forward totaling 4,573,584 million ($3,448,898 thousand) for the loss on prior period error
corrections that is attributable to events occurring from 1991 to 1997 and charged to the operations in
1998. However, the tax authorities refused to reassess the tax loss carry forward and, instead, imposed
on May 1, 2000, a corporate tax assessment of 380,668 million ($287,058 thousand) pertaining to tax-
able year 1998.
The Company appealed the dismissal of its request for the reassessment and imposition of corporate tax
by the tax authorities and brought the case to the National Tax Tribunal. On January 31, 2001, the
NOTES TO NON-CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2001 AND 2000
NOTES TO NON-CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2001 AND 2000
13. CAPITAL SURPLUS:
15. CAPITAL ADJUSTMENTS:
16. EXTRAORDINARY GAIN ON INCOME TAX BENEFITS:
14. DISPOSITIONS OF ACCUMULATED DEFICIT:
2001 2000 2001 2000
1,580,065 1,580,065 1,191,512 1,191,512
119,859 340,848 90,385 257,031
1,699,924 1,920,913 1,281,897 1,448,543
Paid-in capital in excess of par value
Gain on capital reduction
Korean won (In millions) U.S. dollars (Note 2) (in thousands)
February 1995 69,439 52,363
March 1998 62,696 47,278
March 1998 320,151 241,423
March 1999 17,472 13,175
March 1999 3,833,190 2,890,574
March 2000 10,609 8,000
4,313,557 3,252,813
Reserves
Reserves
Asset revaluation surplus
Asset revaluation surplus
Capital surplus
Other capital surplus
Date of Disposition Korean won (in millions) U.S. dollars (Note 2) (in thousands)
2001 2000 2001 2000
(9,798) (287,352) (7,389) (216,690)
175,751 (11,886) 132,532 (8,963)
4,104 1,813 3,095 1,368
- (26,071) - ( 19,660)
170,057 (323,496) 128,238 (243,945)
Treasury stock
Valuation gain (loss) on investments
(see Note 4)
Stock option cost
Valuation loss on derivatives (see Note 2)
Korean won (In millions) U.S. dollars (Note 2) (in thousands)