Kia 2015 Annual Report Download - page 100

Download and view the complete annual report

Please find page 100 of the 2015 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.

Page out of 128

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128

(d) The Company is involved in several claims and litigations for alleged damages and product liabilities, which arose in the ordinary course of
business, as of December 31, 2015. For pending litigations for which no provision is recognized, management is of the opinion that there
is not a constructive or present obligation nor the amounts for potential loss can be reliably estimated, or does management expect they
will have a material adverse effect on the Company’s financial position and results of operations. In addition, as of December 31, 2015, the
Company is involved in litigation in connection with Ordinary Wage and the potential loss cannot be reliably estimated.
(e) In connection with long-term debt guaranteed, amounting to USD 66,667 thousand, by Hyundai Motor America, Inc. and Mobis America,
Inc., Kia Motors Manufacturing Georgia, Inc. (KMMG) should pay guarantor fees calculated at a rate of 0.15% per annum on the
outstanding debt balance of KMMG which should be paid biannually.
(f) As of December 31, 2015, KMMG entered into an agreement with the West Point Development Authority and Troup Country Development
Authority to issue up to USD 2,700,000 thousand of taxable revenue bonds for a term through December 1, 2022, to fund the purchase of
building, machinery and equipment.
20. Derivative financial instruments and hedge
Details of derivative financial instruments to avoid risk as of December 31, 2015 and 2014 are summarized as follows:
(In thousands of foreign currency, In millions of Won)
Purpose Derivatives
Contract amount Fair Value
2015 2014 2015 2014
Cash flow hedge To hedge the variability of
exchange rate for expected export Currency
option
USD 300,000 EUR 30,000 2,078 448
USD 130,000 (2,157)
Fair value hedge To hedge the variability of
exchange rate for foreign deposit -EUR 120,000 -1,000
21. Equity
(a) The number of shares to issue, the number of shares issued and the par value of a share of the Parent Company are 820,000,000 shares,
405,363,347 shares and W 5,000 as of December 31, 2015, respectively.
The Parent Company retired 10 million and 12.5 million shares of treasury shares on July 2, 2003 and May 28, 2004, respectively. Due to
these stock retirements, the aggregate par value of issued shares differs from the common stock amount.
(b) Accumulated other comprehensive income and loss as of December 31, 2015 and 2014 are summarized as follows:
(In millions of won)
2015 2014
Gain on valuation of available-for-sale financial assets
₩
130,324 456,148
Effective portion of changes in fair value of cash flow hedges 430 -
Change in capital adjustments - increase in gain of equity method accounted investments, net of tax of nil 117,058 98,543
Change in capital adjustments - increase in loss of equity method accounted investments, net of tax of nil (326,155) (278,178)
Foreign currency translation difference, net of tax of nil (395,339) (394,814)
₩
(473,682) (118,301)
94 | KIA MOTORS
December 31, 2015 and 2014
KIA MOTORS CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS