Crucial 2012 Annual Report Download - page 290

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INOTERA MEMORIES, INC.
NOTES TO FINANCIAL STATEMENTS
(Continued)
Under U.S. GAAP, the transaction would be considered a related party transaction.
(d) Loss per share
Under ROC GAAP, basic loss per share are calculated by dividing net loss attributable to common shareholders
by the weighted average number of shares outstanding during the year. The shares distributed for employee
bonus are treated as outstanding at the beginning of each period. Diluted loss per share are calculated by taking
basic loss per share into consideration plus additional common shares that would have been outstanding if the
dilutive share equivalents had been issued. Net loss is also adjusted for the interest and other income or expenses
derived from any underlying dilutive share equivalents. The weighted average shares outstanding are adjusted
retroactively for stock dividends issued, capitalization of additional paid-in capital and employee bonus. Anti-
dilutive effects are not included in the dilutive EPS calculation. Under the ARDF Interpretation No. 97-169
“Impacts of Employee Stock Bonuses on Earnings Per Share” which took effect in 2008, the shares distributed
for employees bonus are treated as outstanding at grant date in the calculation of basic earnings (loss) per share
after 2008. For employees bonus that may be distributed in shares, the number of shares to be distributed is
taken into consideration assuming the distribution will be made entirely in shares when calculating for diluted
earnings per share.
Under U.S. GAAP, when a simple capital structure exists, basic loss per share is calculated using the weighted
average number of common shares outstanding. When a complex capital structure exists, diluted loss per share
is based on the weighted average number of shares outstanding plus the number of additional shares that would
have been outstanding if dilutive potential common shares had been issued, with appropriate adjustments to
income or loss that would result from the assumed conversions of those potential common shares. The
materiality of the dilutive effect is not considered. Due to the contingent nature of employee stock bonuses,
they are not included in the diluted EPS calculation.
(e) Pension
Under ROC GAAP, the Company's unrecognized actuarial gains and losses are not recognized as pension
liabilities of a defined benefit post-retirement plan until the accumulated unrecognized amounts exceed certain
thresholds.
Under US GAAP, an employer to recognize the overfunded or underfunded status of a defined benefit post-
retirement plan as an asset or liability in the balance sheet and to recognize changes in that funded status in
other comprehensive income in the year in which the changes occur.
(f) Write-down and valuation of inventory
Under ROC GAAP, inventory is valued at the lower of cost or market. Market is determined on the basis of
net realizable value. Reversals of previous write-downs are recognized in profit or loss in the period in which
the reversal occurs.