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Notes to Non-Consolidated Financial Statements
For the years ended December 31, 2003 and 2002
Amortization of intangible assets for the year ended December 31, 2003 and the nine-month period from April 1,
2002 (spin-off date) to December 31, 2002 consist of the following:
(in millions of Won)
2003 2002
Manufacturing costs ₩34,631 ₩25,032
Selling and administrative expenses 180,992 130,628
₩215,623 ₩155,660
The carrying value of significant intangible assets as of December 31, 2003 and 2002 consist of the following:
(in millions of Won)
Remaining years
2003 2002 for amortization
Goodwill ₩254,399 ₩293,781 7 years
Industrial property rights 311,531 387,890 2~7 years
As a result of LG Electronics Investment Ltd. (formerly LG Electronics Inc., now merged into LG Corp.)’s merger
with LG Information & Communications, Ltd. in September 2000, LG Electronics Investment Ltd. recognized
goodwill amounting to ₩393,820 million and acquired industrial property rights amounting to ₩578,788 million. At
the time of spin-off, such goodwill and industrial property rights were transferred to the Company. Related
amortization expenses of goodwill and industrial property rights approximate ₩39,282 million and ₩76,359 million,
respectively, for the year ended December 31, 2003.
Research and development costs incurred for the year ended December 31, 2003 and the nine-month period
from April 1, 2002 (spin-off date) to December 31, 2002 were accounted for as follows:
(in millions of Won)
2003 2002
Ordinary research and development costs ₩136,847 ₩88,949
Research costs 662,608 434,913
Development costs capitalized - 54,512
₩799,455 ₩578,374
12. Pledged Assets
A substantial portion of property, plant and equipment as of December 31, 2003 is pledged as collateral for
various loans from Korea Development Bank and Kookmin Bank, up to a maximum Won equivalent amount of
approximately ₩300,469 million and ₩264 million, respectively (Notes 14 and 15).