Kia 2010 Annual Report Download - page 46

Notes to Consolidated
Financial Statements
December 31, 2010 and 2009
(c) Research and development costs for the years ended December 31, 2010 and 2009 are summarized as follows:
In millions of won 2010 2009
Development costs ￦ 369,720 355,168
Cost of sales 152,067 96,866
Selling, general and administrative expenses 341,568 265,258
863,355 717,292
(e) The officially declared value of land located in Korea as of December 31, 2010, as announced by the Minister of Construction and
Transportation, is as follows:
In millions of won Book value Declared value
Land ￦ 2,790,144 2,144,581
The officially declared value, which is used for government purposes, is not intended to represent fair value.
12. Intangible Assets
(a) Changes in intangible assets for the year ended December 31, 2010 are summarized as follows:
(*) Foreign currency translation adjustment
Industrial
property Facility usage Development
In millions of won Goodwill rights rights costs
NET BALANCE AT BEGINNING OF YEAR ￦ 24,375 6,312 25,596 1,067,378
Additions - 22,728 4,378 369,720
Amortization (4,864) (6,205) (10,017) (217,741)
Other changes(*) (2,278) (252) (6,973) (239)
NET BALANCE AT END OF YEAR ￦ 17,233 22,583 12,984 1,219,118
(b) Changes in intangible assets for the year ended December 31, 2009 are summarized as follows:
(*) Foreign currency translation adjustment
Industrial Facility usage Development
In millions of won Goodwill property rights rights costs
NET BALANCE AT BEGINNING OF YEAR ￦ 34,681 6,573 25,906 963,547
Additions 29,718 1,233 14,209 355,168
Amortization (5,366) (1,494) (12,570) (251,337)
Loss on impairment (34,644)
Other changes(*) (14) - (1,949) -
NET BALANCE AT END OF YEAR 24,375 6,312 25,596 1,067,378
13. Other Non-Current Assets
Other non-current assets as of December 31, 2010 and 2009 are summarized as follows:
14. Pledged Assets and Guarantees
The following assets are pledged as collateral for the Company’s long-term debt and others as of December 31, 2010:
In millions of won 2010 2009
Long-term financial instruments (note 3) ￦ 20,251 20,552
Long-term accounts receivable - trade, less discount on
present value of ￦1,104 in 2010 and ￦2,071 in 2009 7,597 11,647
Long-term accounts receivable - other, less allowance
for doubtful accounts of ￦319 in 2010 and ￦936 in 2009 22,048 10,722
Long-term loans, less allowance for doubtful accounts of
￦4,695 in 2010 and ￦4,983 in 2009 - 323
Guarantee deposits 212,320 193,689
￦ 262,216 236,933
In millions of won
Type of Borrowing Collateralized
Asset Lender borrowings amount amount
Land and buildings, etc. The Korea Development Bank General loan ￦ 29,369 432,001
Kookmin Bank and others 3,957 6,017
Kookmin Bank 490,000 910,000
Long-term securities Korea Defense Industry Association Guarantee deposit for
performance of contact - 526
Land and buildings Bank of China and others Long-term debt 162,293 170,835
￦ 685,619 1,519,379
(*1) The Company signed an agreement for investments with Government of the Slovak Republic and the related consideration received
amounted to ￦360,878 million which was presented as a reduction of property, plant and equipment.
(*2) “Other” includes foreign currency translation adjustment.
(d) Insurance
As of December 31, 2010, inventories, buildings, structures, machinery and equipment and dies, molds and tools are insured against fire
damage up to ￦7,134,277 million. In addition, the Company carries general insurance for vehicles, workers’ compensation and casualty
insurance for employees. Also, as of December 31, 2010, the Company maintains insurance to cover potential product liabilities up to USD
85,000 thousand in North America and Europe and ￦1,000 million in Korea.
92 COMPONENTS OF SUSTAINABLE GROWTH 93
KIA MOTORS ANNUAL REPORT 2010