D-Link 2013 Annual Report Download - page 38
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D-LINK CORPORATION AND SUBSIDIARIES
Notes to the consolidated financial statements
(Continued)
(q) Revenue
(1) Goods sold
Revenue from the sale of goods in the course of ordinary activities is measured at the fair value
with consideration of net of returns, trade discounts and volume rebates. Revenue is recognized
when persuasive evidence exists, usually in the form of an executed sales agreement, that the
significant risks and rewards of ownership have been transferred to the customer, recovery of the
consideration is probable, the associated costs and possible return of goods can be estimated
reliably, there is no continuing management involvement with the goods, and the amount of
revenue can be measured reliably. If it is probable that discounts will be granted and the amount
can be measured reliably, then the discount is recognized as a reduction of revenue as the sales
are recognized.
The timing of the transfers of risks and rewards varies depending on the individual terms of the
sales agreement or be transferred to the customers which occurs principally at the time when the
goods are delivered.
(2) Services
Revenue from services rendered is recognized in profit or loss in proportion to the stage of
completion of the transaction at the reporting date.
(r) Employee benefits
(1) Defined contribution plans
Obligations for contributions to defined contribution pension plans are recognized as an
employee benefit expense in profit or loss in the periods during which services are rendered by
the employees. YEOCHIA, YEOMAO, YEOTAI, DHD and other holding companies do not
have employees on the payroll, and therefore, do not have a pension plan. DEU and other
subsidiaries adopt pension plans in accordance with the local authorities. DCN contribute
retirement annuity funds based on the statutory rate on employees payroll and the pension
expenses are recognized in profit or loss for the year, while DEU and other subsidiaries
recognized pension expenses based on the contributions in that year.
(2) Defined benefit plans
A defined benefit plan is a post-employment benefit plan other than a defined contribution plan.
The Company’s net obligation in respect of defined benefit pension plans is calculated separately
for each plan by estimating the amount of future benefit that employees have earned in return for
their service in the current and prior periods; that benefit is discounted to determine its present
value. Any unrecognized past service costs and the fair value of any plan assets are deducted.
The discount rate is the yield at the reporting date (market yields of high-quality corporate bonds)
on bonds that have maturity dates approximating the terms of the Company’s obligations and that
are denominated in the same currency in which the benefits are expected to be paid.