LG 2003 Annual Report Download - page 49

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LG Electronics Inc._Annual Report 2003 49
We have audited the accompanying non-consolidated balance sheets of LG Electronics Inc. (the “Company”) as
of December 31, 2003 and 2002, and the related non-consolidated statements of income, appropriations of retained
earnings, and cash flows for the year ended December 31, 2003 and for the nine-month period from April 1, 2002
(spin-off date) to December 31, 2002, expressed in Korean Won.
These financial statements are the responsibility of the Company’s management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the Republic of Korea.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the non-consolidated financial statements referred to above present fairly, in all material respects,
the financial position of LG Electronics Inc. as of December 31, 2003 and 2002, and the results of its operations, the
changes in its retained earnings and its cash flows for the year ended December 31, 2003 and for the nine-month
period from April 1, 2002 (spin-off date) to December 31, 2002 in conformity with accounting principles generally
accepted in the Republic of Korea.
Without qualifying our opinion, we draw your attention to following matters.
As discussed in Note 25 to the accompanying non-consolidated financial statements, for the year ended
December 31, 2003 and for the nine-month period ended December 31, 2002, the Company entered into various
transactions with affiliated companies, including sales amounting to ￦12,590,720 million and ￦7,360,895 million,
respectively, and purchases amounting to ￦2,679,403 million and ￦2,120,313 million, respectively. As of
December 31, 2003 and 2002, related receivables approximated ￦584,407 million and ￦990,556 million,
respectively and payables approximated ￦319,545 million and ￦819,649 million, respectively.
As discussed in Note 15 to the accompanying non-consolidated financial statements, the Company issued
foreign currency convertible bonds amounting to US$287.5 million in the Luxembourg Stock Exchange on August
11, 2003.
As discussed in Note 9 to the accompanying non-consolidated financial statements, the Company participated
in the issuance of new shares of Zenith Electronics Corporation (“Zenith”), a subsidiary located in the U.S.A.,
amounting to US$214 million, and collected senior secured notes of and loans to Zenith amounting to ￦246,225
million.
To the Board of Directors and Shareholders of
LG Electronics Inc.
SAMIL PRICEWATERHOUSECOOPERS
Report of Independent Auditors
Kukje Center Building, 191 Hankangro 2ga, Yongsanku, Seoul 140-702, KOREA(Yongsan P.O. Box 266, 140-600)