Crucial 2011 Annual Report Download - page 195

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44
INOTERA MEMORIES, INC.
NOTES TO FINANCIAL STATEMENTS
Under ROC GAAP, the expatriate employees payroll cost paid by a foreign joint venture partner/shareholder is not
recorded nor treated as the shareholder’s capital surplus in the Company.
Under U.S. GAAP, the expatriate employees payroll cost paid by a foreign joint venture partner would be recorded as
expense and treated as capital surplus in the Company.
Under ROC GAAP, the estimated fair value of a partially leased building used in evaluating the lease classification
described under Note 2 (k) to the financial statements can be based on the proportionate fair value of the entire building.
Under U.S. GAAP, the fair value of a partially leased building used in determining the lease classification must be based
on the specific fair value of the leased asset. In the event that the fair value of the partially leased building cannot be
determined, the lease of a partial building should be treated as an operating lease. As a result, the leased asset described in
Note 7 to the financial statements, which was treated as a capital lease under ROC GAAP, would be treated as an operating
lease under U.S. GAAP.
Under ROC GAAP, the transaction with the General Administrative Office of Formosa Group as described in Note 25(b) is
not treated as a related party transaction.
Under U.S. GAAP, the transaction would be considered a related party transaction.
(Continued)
(27)
Summary of Significant Differences between Accounting Principles Generally Accepted in the Republic of China and
Generally Accepted Accounting Principles in the United States of America
(a)
Capital surplus
(b)
Lease
(c)
Related party transactions