Stock Code 2317
HON HAI PRECISION INDUSTRY CO., LTD.
Annual Report 2013
Annual Report Website Market Observation Post System: http://mops.twse.com.tw Company Website: http://www.foxconn.com.tw Printing Date: April 30, 2014 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 THIS IS A TRANSLATION OF THE 2013 ANNUAL REPORT (THE “ANNUAL REPORT”) OF HON HAI PRECISION INDUSTRY CO., LTD. (THE “COMPANY”). THIS TRANSLATION IS INTENDED FOR REFERENCE ONLY AND NOTHING ELSE, THE COMPANY HEREBY DISCLAIMS ANY AND ALL LIABILITIES WHATSOEVER FOR THE TRANSLATION. THE CHINESE TEXT OF THE ANNUAL REPORT SHALL GOVERN ANY AND ALL MATTERS RELATED TO THE INTERPRETATION OF THE SUBJECT MATTER STATED HEREIN. WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 I. Spokesperson: Deputy Spokesperson:
Name: Simon Hsing Name: Wenmin Chu
Title: Spokesperson Title: Director of Public Relations Office
Tel: (02)2268-3466#3629 Tel: (02)2268-3466#3869
E-mail: [email protected]
II. Contact information of the head office, branch offices and factories
Head office Add: No. 66, Zhongshan Road, Tucheng Industrial Zone, Tucheng District, New Taipei City Tel: (02)2268-3466
Hsinchu Science Park Branch Office Add: 5F-1, No. 5, Hsin-an Road, Hsinchu Science and Industrial Park, East Area, Hsinchu City Tel: (03)578-4975
Neihu Branch Office Add: 1F-11F, No. 32, Jihu Road, Neihu District, Taipei City Tel: (02)2799-6111
California (US) Branch Office Add: 288 S. Mayo Ave City of Industry, CA 91789 U.S.A. Tel: 1-714-680-2066
Huyue Factory Add: No. 2, Zihyou Street, Tucheng Industrial Zone, Tucheng District, New Taipei City Tel: (02)2268-3466
Minsheng Factory Add: No. 4-1, Minsheng Road, Tucheng Industrial Zone, Tucheng District, New Taipei City. Tel: (02)2267-6511
Dingpu No. 1 Factory Add: No. 53, Section 4, Zhongyang Road, Tucheng District, New Taipei City Tel: (02)2268-3466
Dingpu No. 2 Factory Add: 2F, No. 53, Section 4, Zhongyang Road, Tucheng District, New Taipei City Tel: (02)2268-3466
Dingpu No. 5 Factory Add: 4F, No. 53, Section 4, Zhongyang Road, Tucheng District, New Taipei City Tel: (02)2268-3466
WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 III. Share Transfer Agency
Name: Grand Fortune Securities Co., Ltd. Address: 3F, No. 51, Section 1, Minsheng East Road, Taipei City Tel: (02)2562-1658 Website: http://www.gfortune.com.tw
IV. Contact information of the Certified Public Accountants for the Latest Financial Repot
Name: Hsu, Yong-jian, Xue, Ming-ling CPA Firm: Pricewaterhouse Coopers (PwC) Taiwan Address: 27F, No. 333, Section 1, Keelong Road, Taipei City Tel: (02)2729-6666 Website: http://www.pwc.tw
V. Overseas trade places for listed negotiable securities
London Stock Exchange: http://www.londonstockexchange.com
VI. Company Website: http://www.foxconn.com WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Table of Contents I. Letter to Shareholders ...... 2 II. Company Introduction ...... 3 A. Founding date: February 20, 1974 ...... 3 B. Formation History ...... 3 III. Corporate Governance Report ...... 9 A. Organization ...... 9 B. Implementation of corporate governance ...... 32 C. Information on Accountants’ Fees ...... 50 D. Alternation of CPA ...... 51 E. The Company’s chairman, general manager, or any managerial officer in charge of finance or accounting matters has in the most recent year held a position at the accounting firm of its CPA or at an affiliated enterprise: ...... 52 F. Transfer & pledge of stock equity by directors, supervisors, managerial officers and holders of 10% or more of company shares: ...... 53 G. Information on relation among top ten shareholders ...... 55 H. Combined shareholding percentage ...... 56 IV. Company Shares and Fund Raising ...... 57 A. Company capital and shares ...... 57 B. Section on Corporate Bonds ...... 66 C. Preferred Shares (with warrants): ...... 73 D. Global Depository Receipts (GDR) ...... 73 E. Subscription of warrants for employees: ...... 74 F. Name of managers holding warrants for employees and top ten employees in terms of subscription of warrants, and the acquisition status: ...... 75 G. Subscription of new shares for employee restricted stocks: ...... 75 H. Name of managers holding the new shares for employee restricted stocks and top ten employees in terms of subscription of the new share, and the acquisition status: ...... 75 I. Issuance of new shares for merging and transferring the stocks of other companies: ...... 75 J. Implementation of fund usage plan: ...... 75 V. Operational Highlights ...... 76 A. Business Activities ...... 76 B. Production and Sales Status ...... 78 C. Information on Environmental Protection Costs ...... 81 D. Labor Relations ...... 82 VI. Financial Standing ...... 87 A. Most Recent 5-Year Concise Financial Information ...... 87 B. Most Recent 5-Year Financial Analysis ...... 91 C. Audit Report by Supervisors ...... 95 D. 2012 Financial Statements Consolidated With Subsidiaries Audited by CPA ...... 97 VII. Financial Analysis ...... 287 A. 2013 vs. 2012 Financial Analysis ...... 287 B. 2013 vs. 2012 Operating Result Analysis ...... 287 C. Cash Flow Analysis ...... 288 VIII. Special Notes ...... 289 A. Consolidated Financial Statements of Affiliates ...... 289 B. Affiliated Companies Reports: ...... 290
WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
I. Letter to Shareholders
“Change” shall be the watchword we used to describe the global political, economic and industrial circumstance in the past year. The IMF (International Monetary Fund) downgraded global economic growth rate six times within a year. This shows that the economic recovery strength is far behind our expectations. The changes are also more difficult to be predicted. The Company has entered its 40th anniversary since its founding. In an environment of such dramatic change, we are proud of our high consolidated revenue and profit figures in the last fiscal year. I would like to thank all my colleagues, partners, clients, and suppliers for their confidence in us. I also would like to thank all shareholders for their long-term support of the Company.
In reviewing the 2013 global economic environment, mature markets such as the U.S. and Japan have shown progress under governmental stimulus policies. The European market has temporarily stabilized after experiencing difficulties for many years. However, emerging markets, such as former BRIC countries, have experienced volatilities in stocks, bonds and foreign exchanges markets and the strength of economic growth has substantially cooled down while U.S. Fed. (Federal Reserve Board) announced quantitative easing and a gradual exit while international capital withdrew from emerging markets.
In the meantime, the industrial structure has changed into an ecosystem war instead of the old contest of hardware brand names in this “post-PC era”. The acquisition and consolidation of industry entities will continue to proceed, this emphasizes that companies must establish new business models in order to succeed.
Under such a strange and ever-changing environment, our Company is still developmentally stable and is recognized by other business parties. According to the U.S. Fortune “Global 500” ranking report, our Company has moved up in ranking once again from 43rd in 2012 to 30th last year while we continue to strengthen in technical development. In addition, our Company obtained 2,279 U.S. patents in 2013, ranking 8th in the whole world. This dense layout patent network will ensure that the Company continues to innovate and consolidate our competitive advantage.
Looking forward to 2014, we believe persistence can conquer all and wisdom is invincible. When facing uncertainties and continued shuffling in the technology industry, the Company will keep enhancing our competitiveness, deepening our global layout, and gripping worldwide market opportunities for growth.
As shown on the actual technical development layout, the Company is highly involved in research and development of new products, technologies and applications. The Company is also actively recruiting professionals in various fields. The long-term research directions including the information industry, telecommunications industry, consumer electronics, automation equipment, optoelectronics, precision machinery, electric cars, etc., have established rapid production capabilities from components, modules, products assembling to the integrated services.
Today, the Company has expanded from the existing IIDM manufacturing base (Integration- Innovation-Design-Manufacturing) into cloud services, wireless 4G-LTE networking services
WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 and e-commerce. A full “eight screens one network one cloud blue print” will cover working, education, entertainment, social / family relations, security, health, e-commerce, environmentally friendly cars and eight other major new technologies of life. In the future 5G era, the Company will focus on the development of automation and artificial intelligence, combining hardware/software capabilities, using technology to improve human life, and creating greater value for shareholders.
Once again, on behalf of all shareholders of the Company, I sincerely thank all the employees and their families. I also encourage the Company’s management team continue to work hard to maintain the excellent operating results. Thank you so much for all your support.
2 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 II. Company Introduction
A. Founding date: February 20, 1974
Listing date: June 18, 1991
B. Formation History
In 1994
1. Increased capital to NT$1,303,000,000.
2. Reinvested Vate Technology Co., Ltd.
3. Reinvested LUNG HWA Electronics.
4. Many new products like AN and AT were developed.
In 1995
1. Increased capital to NT$2,279,000,000.
2. Reinvested Unimicron Technology Corporation.
3. Reinvested United Microelectronics Corporation.
4. Many new products like L/P MCA, SGC and RF were developed.
5. Huyue Factory carried out its third phase for expansion.
In 1996
1. Increased capital to NT$3,580,000,000.
2. Reinvested Hongyang Venture Capital Investment Co., Ltd.
3. Reinvested Guifeng Co., Ltd.
In 1997
1. Increased capital to NT$5,118,000,000.
2. Set up the heat transfer product business office and environmental-friendly electro-plating technique development department.
3. Established the Material Testing Center.
In 1998
3 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 1. Increased capital to NT$7,346,000,000.
2. Established the High-Speed Electrical Test Lab, the EMI/RFI Lab and Heat Transfer Lab.
3. Listed into The Information Technology 100 (IT 100) by the Business Week of America for the first time.
In 1999
1. Increased capital to NT$11,000,000,000.
2. Capital was first raised from the international finance market via GDR issuance with 10% premium for issuing, creating a new high in overseas capital raising by domestic enterprises.
3. Selected as the Best Management Company in Taiwan by Asian Money.
In 2000
1. Increased capital to NT$14,529,000,000.
2. Issued US$345 million of overseas unsecured and transferable corporate bonds.
3. Invested Foxconn Optical Technology Inc. through its subsidiary – FOTI Holdings Corporation.
In 2001
1. Increased capital to NT$17,687,800,000.
2. Evaluation of Taiwan Ratings as long-term issuer: grade AA- and its prospect: stability.
3. Evaluation of Standard & Poor’s (S & P): grade BBB and its prospect: stability.
4. Became the first largest private manufacturing enterprise in Taiwan.
5. It is the earliest manufacturer of quantity production around the world for Intel Pentium 4 CPU Stocket478.
6. Issued NT$5 billion of domestic unsecured ordinary corporate bonds.
In 2002
1. Increased capital to NT$20,648,970,000.
2. According to survey of Taiwan Ratings, it was the first largest manufacturing enterprise in Taiwan.
4 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 3. Won the first prize of the Best Corporate Strategy by Asiamoney.com.
4. Became the first largest exporter in Greater China.
In 2003
1. Increased capital to NT$25,109,744,000.
2. Issued US$450 million of overseas unsecured and transferable corporate bonds.
3. According to evaluation of IR Magazine, it was awarded the Best Investor Relation in Taiwan.
4. Acquired Motorola Chihuahua Factory in Mexico.
In 2004
1. Increased capital to NT$32,310,231,030.
2. Acquired Eimo Oyji of Finland.
3. Merged Taiwan Ambit Microsystems (Stock) Company.
4. Became the first largest 3C OEM globally.
In 2005
1. Increased capital to NT$40,383,230,780.
2. Invested Antai Power (Stock) Company through its subsidiary – Hongyang Venture Capital Investment (Stock) Company.
3. Invested Chi Mei Communication Systems Inc. through its subsidiary – Transworld Holdings Limited.
4. Issued NT$11,500,000,000 of domestic unsecured ordinary corporate bonds.
5. Its overseas subsidiary – Foxconn International Holdings Ltd. was listed in Hong Kong.
6. Selected as the first largest enterprise in Taiwan firstly by Common Wealth.
7. Ranked among the Top 15 of the World’s Most Admired Companies in Electronics by Fortune .
8. Became a member of Electronic Industry Code of Conduct (EICC), dedicated to promoting corporate social and environmental responsibilities (hereinafter referred to as SER).
5 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 In 2006
1. Increased capital to NT$51,681,387,530.
2. Merged Taiwan Premier Image Technology Corp.
3. Issued NT$18,000,000,000 of domestic unsecured and transferable corporate bonds.
4. Selected as the Happiest Taiwan Enterprise according to the questionnaire survey of 104 Job Bank.
5. Selected as the Most Desirable Company of office staff of Taiwan according to the survey of Cheers.
6. Nominated as the Best Investor Relation Company in Taiwan by IR Magazine.
7. Nominated as the Best Corporate Governance of the Year in Taiwan by IR Magazine.
In 2007
1. Increased capital to NT$62,907,665,030.
2. Awarded as the Most Admired Enterprise in Taiwan by Common Wealth.
3. Nominated as the Best Investor Relation Company in Taiwan by IR Magazine.
4. Awarded the Progress Prize for the best investor relation company in Taiwan by IR Magazine.
5. Awarded the title of the World’s Top 10 Chinese Enterprises of the Year by Asiaweek.
6. Ranked 154 th among Fortune Global 500 Enterprises.
In 2008
1. Increased capital to NT$74,146,234,780.
2. Issued NT$5,180,000,000 of domestic unsecured ordinary corporate bonds.
3. Awarded as the Most Admired Enterprise in Taiwan by Common Wealth.
4. Ranked 132 nd among Fortune Global 500 Enterprises.
In 2009
1. Increased capital to NT$85,789,318,550.
2. Issued NT$6,820,000,000 of domestic unsecured ordinary corporate bonds.
3. Ranked 109 th among Fortune Global 500 Enterprises.
6 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 4. Ranked first among Taiwan enterprises for four consecutive years by Taiwan Ratings.
5. Awarded as the Best Management Enterprise in Taiwan by Finance Asia.
6. Recognized as one of Asia’s Fabulous 50 of Asia by Forbes .
In 2010
1. Increased capital to NT$96,612,482,030.
2. Issued US$1,000,000,000 of overseas transferable corporate bonds.
3. Issued NT$6,000,000,000 of domestic unsecured ordinary corporate bonds.
4. Ranked 176 th among the Forbes Global 2000.
5. Ranked first among Taiwan Top 1000 Enterprises for five consecutive years according to the evaluation of Common Wealth.
6. Ranked first among Taiwan enterprises for five consecutive years by Taiwan Ratings.
7. Ranked 194 th among the Global 500 Enterprises by (Britain) Financial Times.
8. Ranked 112 th among Fortune Global 500.
9. Awarded as the Most Admired Companies in Taiwan by Common Wealth.
In 2011
1. Increased capital to NT$106,890,066,630.
2. Issued NT$18,000,000,000 of domestic unsecured ordinary corporate bonds.
3. Ranked 189 th among Forbes Global 2000.
4. Ranked first among Top 1000 Taiwan Enterprises for six consecutive years by Common Wealth.
5. Ranked first among Taiwan enterprises for six consecutive years according to the evaluation of Taiwan Ratings.
6. Ranked 60 th among Fortune Global 500 by Fortune.
7. Awarded the Most Admired Enterprise in Taiwan by Common Wealth.
In 2012
1. Increased capital to NT$118,358,665,270.
2. Issued NT$26,300,000,000 of domestic unsecured ordinary corporate bonds.
7 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 3. Ranked first among the Top 1000 Taiwan Enterprises for seven consecutive years according to the evaluation of Common Wealth Magazine.
4. Ranked first among Taiwan enterprises according to the evaluation of Taiwan Ratings for seven consecutive years.
5. Ranked 43 rd among Fortune Global 500.
6. Ranked 156 th among Forbes Global 2000.
In 2013
1. Increased capital to NT$131,287,068,400.
2. Issued NT$24,000,000,000 of domestic unsecured ordinary corporate bonds.
3. Ranked first among the Top 1000 Taiwan Enterprises for eight consecutive years according to the evaluation of Common Wealth Magazine.
4. Ranked first among Taiwan enterprises according to the evaluation of Taiwan Ratings for eight consecutive years.
5. Ranked 30 th among Fortune Global 500.
6. Ranked 113 th among Forbes Global 2000.
8 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 III. Corporate Governance Report
A. Organization Shareholders’ Meeting Supervisors
(1) Organization Chart Compensation Committee Board of Directors
Internal Audit Division
Executive Secretary
Chairman Chairman’s Office
President
CNSBG Business Group Group Business CNSBG PCEBG Business Group Group Business PCEBG Group Business iDSBG Group Business iDPBG Global Legal Division Legal Global System information Division information System Center R&D Global Division Management Investment and F&A BusinessGroup SHZBG CESBG Business Group Group Business CESBG BusinessGroup CCPBG Global Procurement Division Procurement Global Division Resources Human
9 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (2) Department functions
Internal Audit Division
Audit internal regulations and rules and put forward proposals for improvement.
President
President is responsible for working out business objectives, taking charge of the implementation of overall businesses, guiding and supervising the departments to deal with their respective businesses.
Business Group
Provide customers with such services as the best design development, trial production, small scale production, mass production, global logistics and after-sale services, etc.
F&A and Investment Management Division
Responsible for financial and accounting matters, budget preparation and control, capital planning and scheduling, operations concerning stock.
Global R&D Center
Mainly to make overall planning for R&D resources, work out R&D direction and integrate R&D with production and manufacturing.
System Information Division
Responsible for establishing, maintaining, managing, controlling and auditing the global information system of the Company and setting up safe management and control and firewall and other relevant mechanisms. Also in charge of connecting global network communication systems of the Company, ERP, KM, virtual office and other platforms.
Global Procurement Division
Responsible for purchasing raw materials needed by the Company for production and manufacturing and adjusting the procurement strategies according to industrial prospects.
Global Legal Division
Responsible for developing, applying and maintaining intellectual property rights for the Company and dealing with relevant lawsuits.
Human Resources Division
Responsible for comprehensive management of such businesses of the Company as personnel, checking attendance and recruitment etc.
10 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (3) Directors and Supervisors
Date: 04/27/2014 Shares currently Shares held in First Shares held when held by their Current shareholding the name of Main working (education) Current positions in the Company and Title Name Elected elected spouses and others experience other companies Date minor children Number % Number % Number % Number % Graduated from China Marine Technical College
Gou, Tai-ming Director of Taiwan Electrical Feb. 20, 1,473,989,536 12.45 1,621,388,489 12.35 0 0 0 0 None Chairman Equipment Association, Chairman of (Terry Gou) 1974 Mold Industry Association
Hon Chiao
International Jun. 10, 18,657,897 0.16 20,523,686 0.16 0 0 0 0 None None Investment Co., 1995 Ltd President of Shenzhen Fujun Material Technology Co., Ltd. President of Foxconn Precision Component (Shenzhen) Co., Ltd. Director President of Futaijie Science and Technology Development (Shenzhen) Co., Ltd.
Representative: Director of Fuhongyuan Environmental Jul. 1, 10,869,951 0.09 11,800,846 0.09 995,651 0.01 0 0 Tatung Institute of Technology, Taiwan Tai, Jeng-wu Technology (Shenzhen) Co., Ltd. 2001 President of Xinxi Technology (Stock) Company Representative of Fitipower Integrated Technology Inc. President of ESON Precision Engineering Co. Ltd. Hon Jin
International Jun. 8, 1,302,812 0.01 1,433,093 0.01 0 0 0 0 None None Investment Co., 2007 Ltd Master’s Degree of Institute of Applied Director Physics, Chung Yuan Christian University Representative: Lu, Representative of Directors of AMBIT Jun. 8, 6,344,859 0.05 7,468,244 0.06 1,680,382 0.01 0 0 Taiwan General Manager of Asia-Pacific MICROSYSTEMS Co. Ltd. Fang-ming 2010 Region, Lingyun Science and Technology Co. Ltd. General Manager of Taiwan Computer System, Hewlett Packard Jun 26, International trade department of Director of Expressive Profits 1,589,324 0.01 1,492,056 0.01 0 0 0 0 Director Chien, Yi-bin 2013 Tamkang University Incorporated
11 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Shares currently Shares held in First Shares held when held by their Current shareholding the name of Main working (education) Current positions in the Company and Title Name Elected elected spouses and others experience other companies Date minor children Number % Number % Number % Number % Independent Director of Cathay Financial Holdings Independent Director of Cathay Life Insurance Independent Director of Cathay Securities Master’s Degree, Graduate School of Corporation Jun 8, Business, Nihon University, Japan Director Huang, Qing-Yuan 0 0 0 0 1,277,449 0.01 0 0 Independent Director of Cathay United Bank 2007 PhD, Graduate School of Business, Director of Taiwan Stock Exchange Nihon University Corporation (TWSE) Independent Director of TAIWANGLASS GROUP President of WeiHeng Asset Management Co., Ltd President of Ji -Tou United Accountant Firm Master’s Degree in Accounting, Supervisor of I-Sheng Electric Independent National Taiwan University Jun. 8, 0 0 0 0 0 0 0 0 Wire & Cable Co., Ltd. Wu, Yu-Chi Bachelor degree in accounting, Director 2010 Supervisor of Procystal Technology Co., Tunghai University Ltd. Attorney of I -Si Technology Law Firm Independent Master’s Degree in Finance, National Liu, Cheng-Yu Jun. 8, 0 0 0 0 0 0 0 0 Independent Director of Taiwan University Director 2007 Stemcyte International, Inc. Fu-Rui
International Jun. 15, 56,536,398 0.48 62,190,037 0.47 0 0 0 0 None None Investment Co., 1998 Supervisor Ltd. Master’s Degree in Accounting,
Representative: National Chengchi University Supervisor of Cheng Uei Precision Industry Jun. 26, 0 0 0 0 0 0 0 0 Cho, Min-chi Bachelor of Business Studies, Co., Ltd. 2013 University , National Taiwan University
Master’s Degree in Accounting,
Soochow University Supervisor of Cheng Uei Precision Industry Supervisor Jun. 26, 0 0 0 0 0 0 0 0 Wan, Jui-hsia Deputy professor, Department of Co., Ltd. 2013 Account, National Taiwan University
12 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (4) Major shareholders of institutional shareholders
Date: 04/27/2014 Name of Institutional Shareholder Name of Major Shareholders Percentage
Outstanding Growth Ltd., British Virgin Islands 90.99% Hongqiao International Investment Co., Ltd. Shijun International Investment Co., Ltd. 9.01% Hongyuan International Investment Co., Ltd. 50% Hongjing International Investment Co., Ltd. Hongqi International Investment Co., Ltd. 50% Xu Muji 99.83% Furui International Investment Co., Ltd. Chien, Yi-bin 0%
(5) Principal shareholder of corporate shareholders with a juridical person as its main shareholder
Name Major shareholders Percentage Outstanding Growth Ltd., British Virgin INB Holdings Limited 100% Islands Shijun International Investment Co., Ltd. Great Century International Limited 100%
Hongyuan International Investment Co., Ltd. Hon Hai Precision Industry Co., Ltd. 100%
Hongqi International Investment Co., Ltd. Hon Hai Precision Industry Co., Ltd. 100%
13 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (6) Professional knowledge and independence check matrix of directors and supervisors
Has over five years work experience and following Qualification professional qualifications Independence Attribute (See Notes Below)
Current Business, Legal Judge, Prosecutor, Business, Positions at Affairs, Finance, Attorney, CPA or Legal Affairs, Other Accounting, National Certified Finance, 1 2 3 4 5 6 7 8 9 10 Companies Name Lecturer or above in Professionals Accounting or Colleges in Related Related Work departments Experience Gou, Tai-ming V V V V V V V 0 Tai, Jeng-wu V V V V V V V V 0 Lu, Fang-ming V V V V V V V V 0 Chien, Yi-bin V V V V V V V V 0 Huang, Qing-Yuan V V V V V V V V V V V 3 Wu, Yu-Chi V V V V V V V V V V V V 0 Liu, Cheng Yu V V V V V V V V V V V V 0 Wan, Jui-hsia V V V V V V V V V V V V 0 Cho, Min-chi V V V V V V V V V V V V 0 Notes: The Directors and Supervisors comply with the following conditions from two years before being elected and during his tenure in office: (1) Not an employee of this Company or its affiliates. (2) Not a Director or Supervisor of the Company or its affiliates. (However, this does not apply, in cases where the person is an Independent Director of the company, its parent company, or any subsidiary in which the company directly or indirectly holds more than 50% of the voting shares.) (3) Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by the person under others’ names, in an aggregate amount of one percent or more of the total number of outstanding shares of the Company or ranking in the top ten in holdings. (4) Not a spouse, second-degree relative or fifth degree relative of those listed in the above three items. (5) Not a director, supervisor, or employee of a corporate shareholder that directly holds five percent or more of the total number of outstanding shares of the Company or that holds shares ranking in the top five in holdings. (6) Not a director, supervisor, manager or a shareholder holding five percent or more of the shares of a company or institution that has a business or financial relationship with the Company. (7) Not a professional individual who, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution that, provides commercial, legal, financial, accounting services or consultation to the Company or to any affiliate of the company, or a spouse thereof. (8) Not a spouse of or a second degree relative of any other Director of the Company. (9) No violations of Article 30 of the Company Act. (10) Not a governmental, judicial person or its representative as defined by Article 27 of the Company Act.
14 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (7) Management Team Information
Date: 04/27/2014 Currently Holding Spouse or second- holding shares of shares in the Shareholding degree relative holding spouses and name of Inaugura Main experience a position as manager Title Name minor children others Current positions at other companies tion date (education experience)
Number % Number % Number % Title Name Relation
Graduated from China Marine Technical College Chairman Terry Feb. 20, Director of Taiwan Electrical and 1,621,388,489 12.35 0 0 0 0 None None None None Gou 1989 Appliances Equipment Association President Chairman of Mold Industry Association
President of Shenzhen Fujun Material Technology Co., Ltd. President of Foxconn Precision Component (Shenzhen) Co., Ltd. President of Futaijie Science and Technology Department Development (Shenzhen) Co., Ltd. Tai, Aug. 1, Tatung Institute of Technology, General 11,800,846 0.09 995,651 0.01 0 0 Director of Fuhongyuan Environmental None None None Jeng-wu 1992 Taiwan Manager Technology (Shenzhen) Co., Ltd. Director of Xinxi Technology Co. Ltd. Representative of Directors of Fitipower Integrated Technology Inc. President of ESON Precision Engineering Co. Ltd.
15 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Currently Holding Spouse or second- holding shares of shares in the Shareholding degree relative holding spouses and name of Inaugura Main experience a position as manager Title Name minor children others Current positions at other companies tion date (education experience)
Number % Number % Number % Title Name Relation
President of Huai’an Fulitong Trade Co., Ltd. President of Fuyu Energy Technology (Kunshan) Co., Ltd. Department President of Qunkang Electronics (Kunshan) You, May 27, Graduated from Tamsui Institute of General 40,307,612 0.31 31,689,525 0.24 0 0 Co., Ltd. None None None Xiang-fu 1992 Business Administration, Taiwan Manager President of FuYuSheng (Zhengzhou) Energy Technology Co., Ltd. President of FuYucheng (Zhengzhou) Agricultural Biotechnology Co., Ltd.
Master’s Degree of Institute of Applied Physics, Chung-Yuan Christian University Department Lu, Apr. 1, Taiwan General Manager of Asia- General Fang- 7,468,244 0.06 1,680,382 0.01 0 0 None None None None 2003 Pacific Region, Lingyun Science Manager ming and Technology Co., Ltd. General Manager of Taiwan Computer System, Hewlett Packard
16 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Currently Holding Spouse or second- holding shares of shares in the Shareholding degree relative holding spouses and name of Inaugura Main experience a position as manager Title Name minor children others Current positions at other companies tion date (education experience)
Number % Number % Number % Title Name Relation
Department Jiang, May 1, Univ. of Birmingham. UK General Hao- 2,926,959 0.02 0 0 0 0 None None None None 2005 Bachelor of EE Manager liang
Department Chien, Jun. 1, International Trade Department of General 1,492,056 0.01 0 0 0 0 Director of Expressive Profits Incorporated None None None Yi-bin 2005 Tamkang University, Taiwan Manager
President of Hongzhun Precision Tooling (Kunshan) Department Co., Ltd. Xu, Jun. 1, Graduated from National Chin-Yi General 8,053,251 0.06 0 0 0 0 President of Hongzhun Precision Tooling None None None Mu-ji 2005 University of Technology, Taiwan Manager (Shenzhen) Co., Ltd.
17 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Currently Holding Spouse or second- holding shares of shares in the Shareholding degree relative holding spouses and name of Inaugura Main experience a position as manager Title Name minor children others Current positions at other companies tion date (education experience)
Number % Number % Number % Title Name Relation
Bachelor degree in economics, Department Zhong, Jan. 1, Iowa State University, U.S.A. President of Hongfujin Precision Industry General 167,699 0.00 0 0 0 0 None None None Yi-wen 2007 Manager of Hon Hai Precision (Shenzhen) Co., Ltd. Manager Industry (Stock) Company
President of Amworld Microsystems (Shanghai) Ltd. Enterprise Research Institute of President of Ambit Microsystems (Shanghai) Department Ling, Jan. 21, University of Washington, U.S.A. Ltd. General 1,654,971 0.01 0 0 0 None None None Zhi-ping 2009 0 School of Business, Taiwan President of Ambit Microsystems Manager University (Zhongshan) Ltd. Representative of Directors of JianHan Technology (shares) Company
18 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Currently Holding Spouse or second- holding shares of shares in the Shareholding degree relative holding spouses and name of Inaugura Main experience a position as manager Title Name minor children others Current positions at other companies tion date (education experience)
Number % Number % Number % Title Name Relation
Director of Foxconn Precision Electronics (Yantai) Co., Ltd. Director of Fu Tai Jing Precision Electronics (Yantai) Company Limited Director of Fu Hong yuan (Shenzhen) Environmental Technology Co. Ltd. Director of Hongfujin Precision Electronics (Yantai) Co., Ltd. Director of Yantai Fuhuada Precision Industrial Management Department Deputy Electronics Co., Ltd. Xiong, of Taiwan Institute of Industrial Department Aug. 31, Director of Competition Optical Technology Bing- 995,702 0.01 132,121 0.00 0 0 Skills None None None General 2009 Ltd. zheng Industrial Engineering Department Manager Director of Competition Team Ireland Ltd. of Taiwan Institute of Technology Director of Competition Team Technology Pte. Ltd. Director of Dominant Elite Holding Ltd. Director of Foxconn Baja California S.A. de C.V. Director of Famous Rise International Ltd. Director of Universal Field International Ltd. Representative of directors of Pan- International Electronics
19 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Currently Holding Spouse or second- holding shares of shares in the Shareholding degree relative holding spouses and name of Inaugura Main experience a position as manager Title Name minor children others Current positions at other companies tion date (education experience)
Number % Number % Number % Title Name Relation
Director of Hongfujin Precision Industry (Shenzhen) Co., Ltd. Graduated from National Chengchi President of Shenzhen Futaitong International University, Taiwan Head Logistics Co., Ltd. Deputy general manager of Huafei Office Li, Oct. 17, Director of Foxconn (Far East) Ltd.(Cayman) 1,150,910 0.01 0 0 0 0 Color Display System (Stock) None None None General Jin-ming 1997 Director of Foxconn (Far East) Ltd.(HK) Company Manager Director of Foxteq Holdings Inc. Manager of Taiwan Philip (Stock) Director of Foxteq Integration, Inc.(Cayman) Company Director of Foxteq Investments Ltd.
Director and president of Hongyang Venture Capital Investment (Stock) Company Representative of directors of Hongqi International Investment (Stock) Company Representative of directors of Baoxin International Investment (Stock) Company Representative of supervisors of Hongjing International Investment (Stock) Company Graduated from National Chiao Representative of supervisors of Liyi Tung University, Taiwan International Investment (Stock) Company Financial director of Vanguard Financial Huang, Apr. Representative of supervisors of Hongyuan 2,857,294 0.02 0 0 0 0 International Semiconductor None None None Director De-cai 15,1998 International investment (Stock) Company Corporation Supervisor of Pan-International Industrial Manager of Taiwan Philip (Stock) Corporation Company Director of Shenzhen Fuxuntong Trading Co., Ltd. Director of Wuhan Tiger Tesco E-Commerce Co., Ltd. Director of Beijing Tiger Tesco E-Commerce Co., Ltd. Director of Chengdu Tiger Tesco E- Commerce Co., Ltd.
20 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Currently Holding Spouse or second- holding shares of shares in the Shareholding degree relative holding spouses and name of Inaugura Main experience a position as manager Title Name minor children others Current positions at other companies tion date (education experience)
Number % Number % Number % Title Name Relation
Director of Apex Gold Limited Director of China Galaxy Enterprises Limited Director of FAST VICTOR LIMITED Director of Focus PC Enterprises Limited. Director of Foxconn (Far East) Limited(HK) Supervisor of FUCHUAN CO., LTD. Master’s Degree in accounting, Director of Full Bonus International Limited Long Island University Director of FUYONG CO., LTD Manager of Deloitte & Touche, Accounting Chou, Jul. 20, Director of Glory Star Investments Limited. 0 0.00 0 0 0 0 Taiwan None None None Director Zong-kai 2010 Director of Great Name Investments Limited Lecturer of Hsing Wu University , Director of Great World Technology Pte. Ltd. Taiwan Director of HIGH PRECISION HOLDINGS
LIMITED Supervisor of KCT Engineering Co., Ltd. Director of Mega Star Investments Limited Director of Operate Technology Limited Director of Precision Technology Investments Pte. Ltd. Director of Tongrand Limited
21 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (8) Remunerations paid to directors, supervisors and management team in the latest year
(a) Director Remuneration
Unit: NT$Thousand Juristic Juristic Juristic Juristic Juristic Independent Independent Title Director Director Director Director Director Director Director Director Director Director Representative Representative Representative
Hon Chiao Hon Jin Gou, Tai- International International Liu, Cheng- Name ming Tai, Jeng-wu Lu, Sung-ching Lu, Fang-ming Chien, Yi-bin Huang, Wu, Yu-Chi Investment Investment Qing- Yu (Terry Gou) Co., Ltd. Co., Ltd. Yuan
The Company 4,500 Remunerations All companies within (A) the consolidated 4,500 financial statements The Company 0 Retirement allowance All companies within (B) the consolidated 0 financial statements
Remuneration The Company 0 from distribution of All companies within earnings the consolidated 0 (C) financial statements The Company 600 Business
execution All companies within expenses (D) the consolidated 600 financial statements Remuneration of Directors The Company 0.0048% Proportion of A, B, C and D to net profit All companies within after tax the consolidated 0.0048% financial statements
22 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 The Company 38,128 Remuneration, money award and All companies within the special expenses consolidated financial 38,128 etc. (E) statements
The Company 0 Retirement All companies within the allowance (F) consolidated financial 0 statements Cash 0 The Dividends Company Stock 151,501 Employee profit Dividends sharing from All earnings Cash companies 0 distribution (G) within the Dividends consolidate Stock d financial 151,501 statements Dividends The Company None Number of stock certificates of All companies within the employee (H) consolidated financial None statements Number of shares The Company None of Employees All companies within the Restricted Stock consolidated financial None
Relevant remuneration of part-time personnel (I) statements The Company 0.183% Proportion of A, B, C, D, E, F and G to net All companies within the profit after tax consolidated financial 0.181% statements Is there any remuneration from other invested No businesses apart from subsidiaries
23 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Range of Remunerations
Names of directors Range of Remunerations paid to directors Summation of the first 4 items (A+B+C+D) Summation of the first 7 items (A+B+C+D+E+F+G) All companies involved in All companies in the financial The Company The Company financial statement (I) statement (J) Terry Gou, Hon Chiao Terry Gou, Hon Chiao International Investment Co., International Investment Co., Terry Gou, Hon Chiao Terry Gou, Hon Chiao Ltd., Tai Jeng-wu, Lu Sung- Ltd., Tai Jeng-wu, Lu Sung- International Investment Co., International Investment Co., Under NT$2,000,000 ching, Hon Jin International ching, Hon Jin International Ltd., Hon Jin International Ltd., Hon Jin International Investment Co., Ltd., Lu Fang- Investment Co., Ltd., Lu Fang- Investment Co., Ltd. Investment Co., Ltd. ming, Chien Yi-bin, ming, Chien Yi-bin, Huang, Qing-Yuan Huang, Qing-Yuan Huang, Qing-Yuan Huang, Qing-Yuan
NT$2,000,000 (included) ~ NT$5,000,000 (excluded) Wu Yu-Chi, Liu Cheng-Yu Wu Yu-Chi, Liu Cheng-Yu Wu Yu-Chi, Liu Cheng-Yu Wu Yu-Chi, Liu Cheng-Yu
NT$5,000,000 (included) ~ NT$10,000,000 (excluded) - - - -
NT$10,000,000 (included) ~ NT$15,000,000 (excluded) - - - -
NT$15,000,000 (included) ~ NT$30,000,000 (excluded) - - Chien Yi-bin Chien Yi-bin
NT$30,000,000 (included) ~ NT$50,000,000 (excluded) - - - -
NT$50,000,000 (included) ~ NT$100,000,000 (excluded) - - Tai Jeng-wu Tai Jeng-wu
Over NT$100,000,000 - - Lu Fang-ming Lu Fang-ming
Total 10 10 10 10
24 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (b) Remunerations of Supervisors
Unit: NT$Thousand
Remuneration of supervisors Proportion of A, B and C Is there any Remuneration from Business execution to net profit after tax remuneration Remunerations (A) earnings distribution (B) expenses (C) from other Title Name invested All All All All businesses companies companies companies The companies in The The The apart from in the in the in the Company the financial Company Company Company subsidiaries financial financial financial statement statements statements statements Supervisor Huang, Qing-Yuan
Supervisor Wan Jui-hsia 3,600 3,600 0 0 480 480 0.0038% 0.0038% None Fu-Rui International Investment Co., Ltd. Supervisor Representative: Cho, Min-Chi
25 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Range of Remunerations
Name of Supervisor Range of Remuneration Paid to Supervisors Summation of the first three items (A+B+C) The Company All companies in the financial statement (D) Huang, Qing-Yuan Huang, Qing-Yuan Under NT$2,000,000 Fu-Rui International Investment Co., Ltd. Fu-Rui International Investment Co., Ltd. Representative: Wan Jui-Hsia, Cho, Min-Chi Representative: Wan Jui-Hsia, Cho, Min-Chi
NT$2,000,000 (included) ~ NT$ 5,000,000 (excluded) - -
NT$5,000,000 (included) ~ NT$10,000,000 (excluded) - -
NT$10,000,000 (included) ~ NT$15,000,000 (excluded) - -
NT$15,000,000 (included) ~ NT$30,000,000 (excluded) - -
NT$30,000,000 (included) ~ NT$50,000,000 (excluded) - -
NT$50,000,000 (included) ~ NT$100,000,000 (excluded) - -
Over NT$100,000,000 - -
Total 4 4
26 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (c) Remunerations paid to the management team
Unit: NT$Thousand Rate of total Number of Money award and Earning distribution as dividends amount of A, B, Number of shares Remunerations Retirement stock special payment for personnel (D) C and D to pure of Employees (A) allowance (B) certificates of etc. (C) (Note) profits after tax Restricted Stock employee (%) All companies involved in The Company Title Name financial statement Remuneration otherfrom invested businesses apart from subsidiaries. The Company All companies in the financial statement The Company All companies in the financial statement The Company All companies in the financial statement Cash Dividends Stock Dividends Cash Dividends Stock Dividends The Company All companies in the financial statement The Company All companies in the financial statement The Company All companies in the financial statement General Terry Gou Manager Department Lu, General Sung-ching Manager Department You, Xiang- General fu Manager Department Tai, General Jeng-wu Manager Department 19,868 19868 552 552 67,518 69,525 0 263,338 0 263,338 0.082% 0.084% None None None None None Lu, Fang- General ming Manager Department Jiang, General Hao-liang Manager Department Chien, General Yi-bin Manager Department Xu, General Mu-ji Manager
27 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Department Zhong, General Yi-wen Manager Department Ling, General Zhi-ping Manager Deputy Department Xiong, General Bing-zheng Manager Head Office Li, General Jin-ming Manager Financial Huang, Director De-cai Accounting Chou, Director Zong-kai Note 1: NT$7,682.195 Thousand of earnings were distributed to employees as dividends in 2013 according to the resolution of board of directors. In this year, the actual distribution rate will be considered for distributing dividends.
Note 2: As Lu Sung-ching has transferred to one of the subsidiaries, his remuneration has ceased from October 31, 2013.
28 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Range of Remunerations
Names of General Managers and Deputy General Managers Range of remuneration paid to the management team The Company All companies in the financial statement (E)
Under NT$2,000,000 Terry Gou, Lu, Sung-ching , You Xiangfu, Xu Muji Terry Gou, Lu, Sung-ching , You Xiangfu, Xu Muji
NT$2,000,000 (included) ~ NT$5,000,000 (excluded) Xiong, Bing-zheng Xiong, Bing-zheng
NT$5,000,000 (included) ~ NT$10,000,000 (excluded) Chou Zongkai Chou Zongkai
NT$10,000,000 (included) ~ NT$15,000,000 (excluded) - -
NT$15,000,000 (included) ~ NT$30,000,000 (excluded) Jiang, Hao-liang , Chien Yi-bin, Li Jin-ming Jiang, Hao-liang , Chien Yi-bin, Li Jin-ming
NT$30,000,000 (included) ~ NT$50,000,000 (excluded) Zhong Yi-wen, Ling Zhi-ping, Huang Decai Zhong Yi-wen, Ling Zhi-ping, Huang Decai
NT$50,000,000 (included) ~ NT$100,000,000 (excluded) Tai Jeng-wu Tai Jeng-wu
Over NT$100,000,000 Lu Fang-ming Lu Fang-ming
Total 14 14
29 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (d) Employee profit sharing granted to the management team
Unit: NT$Thousand
Stock Dividends Cash Dividends Proportion of total amount to net Title Name Total (Note) (Note) profits after tax (%) General manager Terry Gou Department General Manager You, Xiang-fu Department General Manager Tai, Jeng-wu Department General Manager Lu, Fang-ming
Management Team Team Management Department General Manager Jiang, Hao-liang Department General Manager Chien, Yi-bin Department General Manager Xu, Mu-ji 263,338 0 263,338 0.2453% Department General Manager Zhong, Yi-wen Department General Manager Ling, Zhi-ping Department Deputy General Manager Xiong, Bing-zheng Head Office General Manager Li, Jin-ming Financial Director Huang, De-cai Accounting Director Chou, Zong-kai Note: As of the printing date of this Annual Report, the distribution list of employee profit sharing has not been fixed, and shall be proposed as stipulated according to the actual distribution of the last year.
30 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (e) Analysis of the proportion of the total remuneration of directors, supervisors, general managers and deputy general managers of the Company paid by the Company and all companies in the consolidated financial statement to net profit after tax in individual financial statements of the recent two years.
Proportion of total compensation to net profit after tax Item 2013 2012 Title All companies in All companies in the consolidated The Company the consolidated The Company financial financial statement statement Directors 0.183% 0.181% 0.182% 0.188%
Supervisors 0.004% 0.004% 0.004% 0.004% General Manager and Deputy 0.329% 0.329% 0.327% 0.338% General Managers
(f) Procedures for payment and relevance with operation performance and future risks
(i) According to the distribution of earnings as stipulated in the Company Articles of Incorporation, except employee profit sharing, there is no distribution to directors or supervisors.
(ii) The remunerations paid to general managers and deputy general managers during the recent two years include salary, money award and employee profit sharing from earnings distribution. As for salary and money award, the payment is handled according to the relevant procedures of the Company’s personnel regulations. As for employee profit sharing from earnings distribution, the distribution is proposed by board of directors according to the distribution of annual earnings and the earnings distribution as stipulated in the Company Articles of Incorporation and upon the approval of the shareholder meeting.
(iii) According to the Company’s policy for payment of compensation, reasonable compensation shall be paid based on job evaluation of the personnel in the Company.
31 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 B. Implementation of corporate governance
(1) Information on implementation of Board of Directors
Six meetings were held by the Board of Directors in the recent year (2013) with their attendance shown as follows:
Attendance in Attendance rate Title Name By proxy Remarks person in person (%) Continue in Chairman Terry Gou 1 5 16.67 Office Representative of Hon Chiao International Continue in Director 4 0 66.67 Investment Co., Ltd.: Office Tai, Jeng-wu Representative of Hon Chiao International Leaving Director 2 1 66.67 Investment Co., Ltd.: Office Lu, Sung-ching Representative of Hon Jin Continue in Director International Investment 6 0 100 Office Co., Ltd.: Lu, Fang-ming Continue in Director Chien, Yi-bin 0 0 0 Office Newly Director Huang, Qing-Yuan 3 0 100 Elected Independent Continue in Wu, Yu-Chi 6 0 100 Director Office Independent 83.33 Continue in Liu, Cheng-Yu 5 0 Director Office Other noteworthy matters: 1. Matters specified in Article 14.3 of Taiwan’s Securities and Exchange Act or Board resolutions where other Independent Directors have expressed opposition or qualified opinions that have been noted in the record or declared in writing: None 2. Avoidance of Conflict of Interest by directors. None 3. Assessment of objectives (such setting of an audit committee and improvement of information transparency etc.) and implementation status in the area of strengthening the powers of the board of directors for current and immediately past years: None. Note: The Company elected new directors on June 26, 2013. There were 3 BOD meetings each prior to and after the election.
(2) Operation status of Audit Committee:
The Company does not have an audit committee.
32 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (3) Participation of supervisors in the operation of the Board of Directors:
Six meetings were held by the Board of Directors in the recent year (2013) with the attendance of supervisors shown as follows:
Attendance in Attendance rate Title Name Remarks person (%)
Supervisor Wan, Jui-hsia 5 83.33 Continue in Office Representative of Fu-Rui Supervisor International Investment 2 66.67 Newly Elected Co., Ltd.: Cho, Min-Chi Supervisor Huang, Qing-Yuan 2 66.67 Leaving Office Other noteworthy matters: 1. Organization and responsibilities of supervisors (a) Communication of between supervisors with and the Company’s employees and shareholders: Supervisors regard direct connection and dialogue with the Company’s employees and shareholders from the perspective of supervisors (b) Communication between supervisors with and internal audit director and accountants. (1) Supervisors have no objection to the Audit director shall submit audit report submitted by the audit director of audit items to supervisors in the next following month after the audit is completed. (2) Audit director shall attend the regular meeting of the Board of Directors and make prepare the audit service report to which supervisors do not have any no objection. (3) Supervisors carry out face-to-face regular quarterly communication and communication in written form with accountants on finance regularly in each quarter in person and in writing. 2. If supervisors participating in board meetings have expressed opinions, meeting minutes shall record date and session of the board meeting, content of the resolution, resolution of the meeting and the response of the Company regarding the supervisor’s opinion: None. Note: The Company elected new supervisors on June 26, 2013. There were 3 meetings each prior to and after the election.
33 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (4) Corporate governance implementation and the difference from the Corporate Governance Best Practice Principles for TWSE/GTSM-Listed Companies and reasons
Difference from corporate governance practice principles Item Operation for TWSE/GTSM-Listed companies and reasons 1. Equity structure and shareholder rights 1. An investor relation office was set up to deal with shareholder In conformity with the (1) How the Company handles shareholder suggestions of shareholders suggestions and disputes. corporate governance practice and disputes. 2. The Company can control the list of its major shareholders and final principles (2) Company’s control of the list of its major shareholders and final decision-makers, and disclose them legally. decision-makers 3. The Company, according to such relevant internal methods as operating (3) How the Company establishes its risk management mechanism and methods for operating, service and financial operations with specific firewalls involving related enterprises. companies and group enterprises, supervision methods for subsidiaries, endorsement guarantee method, capital loan and other methods and assets to get or deal with assets, has established proper risk management and control mechanism and firewalls. Those who have business contact with any materially related enterprise shall be deemed as independent third person so as to avoid non-conventional transactions. 2. Organization and responsibilities of the Board of Directors 1. The company has two Independent Directors. In conformity with the (1) Establishment of Independent Directors 2. Carry out regular assessment on independence of CPA. corporate governance practice (2) Regular assessment on independence of CPA principles III. Establishment of communication channels with materially related Direct communication and dialogue with stakeholders shall be done when In conformity with the parties supervisors regard it necessary. corporate governance practice principles 4. Disclosure of information 1. The Company has established a website where relevant information on In conformity with the (1) Establishment of a Website where information on financial financial operations and business is disclosed, or the Company’s relevant corporate governance practice operations and corporate governance is disclosed. information on financial operations, business and corporate governance can principles (2) Use of other methods for information disclosure (such as setting an be inquired through an open information observation station. English website, appointing personnel in charge of collecting and 2. The Company has appointed special person in charge of information disclosing information, implementing spokesman system and disclosure of the open information observation station of exchange through publication of shareholder meeting records on the Company’s website). observation station and information release on website of company. 3. The Company has set up positions for spokesperson and deputy spokesperson. 5.Operation of Functional Commissions such as the Nomination, or The Company has set up the Compensation Committee according to the At present, the Company Compensation Committees established by the Company regulations. doesn’t set up such functional commissions as Nomination Committee and Audit Committee. 6. If the Company works out its corporate governance system according to the rule of “Corporate Governance Best Practice Principles for TWSE/GTSM-Listed Companies , please state the differences from other companies. The Company is still planning its corporate governance system, but the rights of directors and supervisors and the internal control systems are made according to the spirit and standards in Corporate Governance Best Practice Principles for TWSE/GTSM-Listed Companies.
34 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Difference from corporate governance practice principles Item Operation for TWSE/GTSM-Listed companies and reasons 7. Other important information for better understanding the Company’s corporate governance operation (1)Interests and rights of employees: The Company treats employees in an honest way all the time to ensure their legal interests and rights according to the Labor Standards Act. (2)Care for employees: by adopting welfare system and good education and training, mutual trust relationship established with employees, such as assistance to employees in group activities and supply of entertainment facilities, subsidy for health diagnosis and medical consulting, supply of employee dormitory, care for lodging life of employees and parking lot etc. (3)Relation with investors: The investor relation office was set up to deal with shareholder suggestions. (4)Relation with suppliers: good relations with suppliers are maintained all the time. (5)Relation with materially related parties: materially related parties shall communicate with the Company and put forward proposals to protect their due legal rights and interests. (6)Further study of directors and supervisors: the Company’s directors are qualified with industrial professional knowledge and practice experience in operation management. (7)Execution of risk management policy and risk measuring standards: various internal regulations are established legally for various risk management and evaluation. (8)Execution of customer policies: stable and good relations with customers are maintained with the view of creating profits. (9)Liability insurance for the Company’s directors and supervisors: liability insurance has been covered for directors and supervisors. 8.If there exist corporate governance evaluation reports done by the Company itself or outsourced to professional agencies, please state the evaluation result, major shortcomings (or recommendations) and improvement: N/A.
35 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (5) Organization, responsibilities and operation status of the Compensation Committee:
(a) Information on members of the Compensation Committee
Has over 5 years of work experience and following professional qualifications. Independence Attribute (Note 2) Business, Judge, Business, Conditions Legal Affairs, Prosecutor, Legal Current ID Finance, Attorney, CPA Affairs, positions at (Note 1) Name Accounting, or National Finance, other Lecturer or Certified Accounting 1 2 3 4 5 6 7 8 companies above in Professionals or Related Colleges in Work Related Experience departments Independent Wu, Yu-Chi V V V V V V V V V V 0 Director Independent Liu, Cheng-Yu V V V V V V V V V V 0 Director
Other Lin, Song-Shu V V V V V V V V V V 0 Note: All member complies with the following conditions from 2 years before being elected and during his tenure in office. (1) They are neither employees of the Company nor its affiliates (2) They are neither directors nor supervisors of the Company or its affiliates, unless they are Independent Directors of the Company or its parent company or subsidiaries in which the Company holds, directly or indirectly, more than 50% of the voting shares. (3) They are not individual shareholders who hold shares, together with those held by their spouses, minor children or held under others’ name, in an aggregate amount of more than 1% of the total outstanding shares of the Company or ranks among the top ten shareholders who are natural persons in terms of the share volume held. (4) They are not spouses or relative within the second degree of kinship or lineal relative within the third degree of kinship, or any of the persons in the preceding three subparagraphs. (5) They are not directors, supervisors or employees of a corporate shareholder that directly holds 5% or more of the total outstanding shares of the Company or ranks among the top 5 corporate shareholders in the terms of share volume held. (6) They are not directors, supervisors, managers or shareholders holding 5% or more shares of a specific company or institution and who also have financial or business dealings with the Company. (7) They are not professionals or owners, partners, directors, supervisors, or executive officer and the spouse thereof of a sole proprietorship, partnership, company, or institution that provides commercial, legal, financial, accounting or consulting services to the Company or to its affiliates. (8) Not any of the circumstances in Article 30 of the Company Act.
36 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (b) Operation status of the Compensation Committee
(1) There are 3 members in the Company’s Compensation Committee.
(2) Current Term: From August 13, 2013 to June 30, 2016. The Compensation Committee held two meetings (A) in the recent year, the qualifications and attendance of the Committee are shown as follows:
Attendance rate in Attendance in Title Name By proxy person (%) (B/A) Remarks person (B) (Note)
Continue in Office Convener Wu, Yu-Chi 2 0 100 from August 13, 2013 Continue in Office Member Liu, Cheng-Yu 2 0 100 from August 13, 2013 Newly Elected on Member Lin, Song-Shu 1 0 100% March 28, 2014 Leaving Office on Member Lu, Fang-ming 0 0 0 March 19, 2014 Other noteworthy matters: None
37 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (6) Performance of Social Responsibilities
Difference from the Corporate Social Responsibility Best Items Implementation Status Practice Principles for TWSE/GTSM-Listed Companies and reasons 1. Exercise and enhance corporate 1. At present, the Company has worked out its Conformity governance corporate social responsibility policy, covering ethnics, (1) The Company works out its corporate laborers, safety, health, environment and management, social responsibility policy and checks the and established Foxconn Global SER Committee results of the implementation. (FGSC) to drive and supervise the execution of (2) The Company sets up exclusively (or relevant CSR operations. concurrently) dedicated units to be in 2. In 2007, The Company set up FGSC organization, charge of proposing and enforcing the which is composed of 7 full-time personnel in charge corporate social responsibility policies. of driving and supervising relevant work, including the (3) The Company organizes regular implementation of internal audit, performance education and training on business ethnics assessment, CSR education and training, and the and advocating principles for directors, publication of CSR annual report. In addition, there are supervisors and employees, and should over 60 part-time personnel in each business group and incorporate the foregoing into its surrounding units in charge of executing CSR related employee performance assessment system work. to establish a clear and effective reward 3. The Company carries out regular trainings and and punishment system. propaganda on corporate business ethnics for its employees every year. For its new employees, trainings on personnel rules, management system, business ethnics and morals are carried out on their first working day to clarify their due responsibilities and obligations.
2. Environment for sustainable 1. The Company actively advocates water recycling, Conformity development and adopts some renewable/biodegradable raw (1) The Company endeavors to utilize all materials to effectively reduce the impact of resources more efficiently and uses production and manufacturing on the environment. renewable materials which have a low 2. In response to the international trend and customer impact on the environment. requirements, the Company gradually established (2) Based on its industrial features, the environment management systems for its business Company establishes proper environment units, and passed the certification of ISO 14001. management systems. 3. In 2008, environmental protection office was (3) The Company establishes dedicated established to be in charge of planning, design, units or assigns dedicated personnel for management and operation maintenance of environment management to maintain the environmental protection facilities, which were environment. installed in all working areas. Moreover, the Company (4) The Company monitors the impact of obtained the discharge license issued by the climate change on its operations, and government, and assigned dedicated personnel to be in should establish company strategies to charge of equipment operation in accordance with laws save energy and reduce the emission of and regulations. carbon and greenhouse gas. 4. From 2008, the Company started the examination of the emission of carbon dioxide, and some working areas obtained certificates after passing the certification. At the same time, the examination report was submitted to relevant UN agencies with a view to actively participating in important international topics. The Company also started to promote energy management by means of working out the objectives of energy conservation and emission reduction and endeavoring to the achieve them.
38 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Difference from the Corporate Social Responsibility Best Items Implementation Status Practice Principles for TWSE/GTSM-Listed Companies and reasons 3. Protect social public interests 1. The Company abides by the labor law of the region Conformity (1) According to the relevant labor laws (or the country) where its working plants are located and internationally acknowledged human by transferring relevant contents into its labor rights of laborers, the Company management policy. The Company has established establishes proper management methods, corresponding procedures and special lines for labor procedures and non-discrimination management to ensure the legal interests and rights of employment policy to ensure the legal its employees. rights and interests of employees. 2. The Company provides safe and healthy working (2) The Company provides safe and environment for its employees and focus on employee healthy working environment for its health care, a health management center to provide employees and organizes training on employee health and health-related advice and safety and health on a regular basis. assistance, and regular health and safety at work (3) The Company establishes regular seminars. communication mechanism for 3. The Company regularly holds various employees, and informs employees of the communication meetings with employees to convey operation changes that may have the Company’s policies and information. significant impact on employees in a 4. The Company follows the regulations on limited reasonable way. use/prohibited use of hazardous substance and conflict (4) The Company works out and discloses minerals in an all-round way and provides relevant its policies on consumer rights and information to customers. interests and establishes transparent and 5. The Company has thousands of supplier s in different effective procedures for accepting regions, but we learn from each other for common consumer complaints in its products and progress in the aspects of society and environment like service. hazardous substance control, environmental protection, (5) The Company cooperates with its labor safety and health, human rights, conflict metal suppliers to jointly foster a stronger sense and carbon footprint. At the same time, our suppliers of corporate social responsibilities. are required to practice their corporate social (6) Through commercial activities, non- responsibilities. cash property endowments, voluntary 6. As the Company actively participates in social service or other free profession al services, activities for public interests and charitable activities, the company participates in community donations are provided for affected people in the Flood development and charities events. of August 8th (in Taiwan), Sichuan Earthquake, Japan Earthquake as well as Floral Expo Charitable Garden Party.
4. Enhance information disclosure 1. A special column for “corporate responsibilities” is Conformity (1) The ways for the company to disclose established on the Company’s website.
39 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Difference from the Corporate Social Responsibility Best Items Implementation Status Practice Principles for TWSE/GTSM-Listed Companies and reasons relevant critical and reliable information 2. As an EICC member, the Company is dedicated to on corporate social responsibilities. promoting social and environmental responsibilities (2) The Company compiles with the (hereinafter referred to as SER), and worked out report on corporate social responsibilities “Foxconn Global Codes of Conducts: Social and to disclose the performance of corporate Environmental Responsibilities ”. social responsibilities.
5. If the Company makes its own corporate social responsibilities according to the rule of Corporate Social Responsibility Best Practice Principles for TWSE/GTSM-Listed Companies , please state the differences. The Company carries out regular trainings and propaganda on corporate business ethnics for its employees every year. For its new employees, trainings on personnel rules, management system, business ethnics and morals are carried out on their first working day to clarify their due rights and obligations. However, the Company hasn’t prepared its own Corporate Social Responsibility Best Practice Principles for TWSE/GTSM-Listed Companies , which will be worked out in the future according to the specific regulations. 6. Other important information for better understanding of corporate social responsibilities (such as systems and measures that the company has adopted with respect to environmental protection, community participation, social contributions, social services, social and public interest, legal rights and interests of consumers, human rights, safety, health and other corporate social responsibilities, and the status of implementation.): (1) New processing systems are introduced to enhance the capacity to recover wastes and sewage, and installed and put into operation in some workshop areas. (2) Donated NT$ 3,601,800 to Chinese Youth International Scholarship. (3) Donated NT$ 20,000,000 3,601,800 to Volunteer Fire Fighting Association of the ROC to promote firefighting business. (4) Donated NT$ 2,090,175 to Taipei Flow Expo for 60” TVs in “Intelligent-Mobile Experience Exhibition Hall”. (5) Donated NT$ 3,880,000 for 60” TVs to Excellent “Elderly and Handicapped Nursing Institute” selected by Ministry of Interior. (6) Donated NT$ 200,000 to SINOCON Industrial Standards Foundation. (7) Donated NT$ 12,500,000 to “Chiang Ching-Kuo Foundation for International Scholarly Exchange”. (8) Donated NT$ 425,175 to Summer Intern Scholarship, National Chung Hsing University. (9) Donated NT $ 543,000 to Law Foundation, NTU. (10) Donated NT $ 1,608,164 to National Taiwan University of Science and Technology (NTUST) Scholarship. (11) Donated NT$ 193,941 to Summer Intern Scholarship, National Chiao Tung University. (12) Donated NT$ 5,585,000 to Graduate School Scholarship, National Kaohsiung University of Applied Sciences. (13) Donated NT $ 8,905,544 to National Tsing Hua University Scholarship. (14) Donated NT$ 53,847 to Summer Intern Scholarship, National Taipei University of Technology (Taipei Tech). (15) Donated NT$500,000 to National Taiwan Science Education Center. (16) Donated NT$ 70,000,000 to “Night Angel Project” of Ministry of Education. (17) Donated NT$ 6,000,000 to “Chuang Chih-yuan” Project, Sports Administration, Ministry of Education. (18) The Company has hosted lots of charity party to support disadvantaged people and social charitable organizations. (19) Based on respect employees, the Company emphasizes employment of no children and no compulsory overtime work, and cadres are required to pay no discrimination or harass employees. Above measures are announced formally. (20) The Company established a safety and health department to regularly examine plant facilities and provide education and training on industrial safety and health and relevant performance assessment. (21) The Company set up a supplier management office for auditing the corporate social responsibilities and training of its suppliers every year. 7. Clear statement shall be made if the products or corporate social responsibility report of the Company pass the inspection of relevant certification agencies: The Company hasn’t submitted its annual report on corporate social responsibilities to any certification organization for inspection, but plans to submit it to a third-party certification institution for inspection in the near future.
40 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (7) Status of Implementation of Integrity Management
Implementation of Integrity Operation
Difference from the Integrity Operation Practice Principles for Items Implementation TWSE/GTSM-Listed Companies and reasons 1. Adopt integrity operation policy and The Company sticks to the corporate Conformity scheme culture with integrity operation as the (1) The company clarifies the integrity core and works out codes of conduct operation policy in its regulations and (CoC) for stakeholders to perform external documents and the commitment of relevant social and environmental board of directors and managers to active responsibilities, including Letter of implementation. Commitment of Manufacturers signed (2) The company works out scheme, with suppliers, clearly stating that operation procedures and guidelines of suppliers should ensure transparent and conducts for employee education and fair commercial trading activities. In training to prevent dishonest behaviors addition, the Company has made (3) When working out a scheme to prevent commitment to customers and dishonest behaviors, the company adopts shareholders in its CoC. measures to prevent bribery and illegal The Company carries out education and political contributions in business activities training for all employees on CoC every with high risks of dishonest behaviors. year regularly. For its new employees, trainings on personnel regulations, management system, business ethnics and morals are provided to clearly state their due rights and obligations. The Company, strictly sticking to business ethnics from its top level to down level, establishes integrity corporate culture and creates an operation environment for sustainable development based on transparent, incorruptible and responsible operation concepts. 2. Put integrity operation into practice The Company adheres to integrity Conformity (1) The company should keep its culture and operation, commits to commercial activities away from people abiding by requirements of international with records of dishonest behaviors, and and domestic laws and regulations on articles on honest behaviors shall be anti-corruption and anti-bribery, takes explicitly stated in commercial contracts. zero-tolerance policy for any behavior or (2) The company sets up company sets up activity against the regulations, and exclusively (or concurrently) dedicated strictly prohibits any corruption, bribery, units to be in charge of corporate integrity embezzlement and other illegal earning operation and supervision of the board of activities. All employees shall receive directors. anti-corruption trainings for at least 2 (3) The company works out policies to hours every year. In addition, the prevent interest conflicts and provide Company asks its downstream suppliers, proper statement channels. manufacturers and customers to strictly (4) The company shall establish effective implement high-standard anti-corruption accounting system, internal control system policies as the premise for cooperation. and auditing of internal auditors to put After approved by the chairman of the integrity operation into practice. Global SER Committee and the general managers of the business group, the codes of conducts on corporate social and environmental responsibilities have become the basic principles and standards of the Company to deal with
41 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Difference from the Integrity Operation Practice Principles for Items Implementation TWSE/GTSM-Listed Companies and reasons relationship with all stakeholders (employees, customers, shareholders, suppliers, public community, investors and non-governmental organizations). The whole management team of the Company must strictly abide by the principles of conducts and the stated spirit and guiding principle. Under the supervision of board of directors, directors of each business group must ensure their commercial operations in conformity with the regulations of CoC. The Company demands all new employees to sign the Agreement on Integrity, Incorruption and Confidentiality of Intellectual Property Rights and asks other employees to abide by it. At the same time, the Company also requires that its suppliers or other cooperators should sign the Letter of Commitment of Manufacturers to ensure transparent and fair commercial trading activities. The Company holds annual supplier meetings and carries out irregular SER audit, conveying its requirements for suppliers. The Company establishes accounting and internal control systems to put integrity operation into practice. After its internal auditors work out and review the annual audit program according to the risk evaluation results, the Company will compile them into audit report and submit it to the board of directors. 3. The company establishes reporting The Company establishes various Conformity channels and punishments for violation reporting channels so that employees against the regulations of integrity and relevant people can report the operation as well as the appeal system. improper business behaviors through the system. Anyone who violates the regulations on integrity operation will be punished according to the Company’s regulations on reward and punishment. In case of any illegal affairs, legal actions will be taken as well. 4. Enhance information disclosure On the Company’s official website both Conformity (1) The company establishes a website to in Chinese and English disclose relevant information on integrity (http://www.foxconn.com ), there are operation. relevant information on integrity (2) Other information disclosure methods operation such as annual report on of the company (such as setting up an corporate social and environmental English website, appointing a dedicated responsibilities and CoC. person in charge of collecting and disclosing company information through the website etc.).
42 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Difference from the Integrity Operation Practice Principles for Items Implementation TWSE/GTSM-Listed Companies and reasons 5. If the company makes its own integrity operation according to the Integrity Operation Best Practice Principles for TWSE/GTSM-Listed Companies , please state the differences. The Company has its own regulations on integrity and incorruption, which shall be respected by all employees, managers and board of directors. 6. Other important information for better understanding of the integrity operation (such as the company’s determination on advocating the integrity operation and policy among manufacturers who have business dealings with the company, inviting them to participate in relevant trainings and review and revise the regulations on integrity operation). Please refer to the Company’s official website: http://www.foxconn.com/CSR_REPORT.html (Annual Report on Corporate Social and Environmental Responsibilities).
(8) Other Company-established corporate governance rules and regulations:
N/A
(9) Other Important Corporate Governance Information:
None
43 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (10) Status of Implementation of Internal Control System
(a) Statement of internal control system
Hon Hai Precision Industry Co., Ltd.
Statement of Internal Controls
Date: 03/28/2014
According to the examination on internal control system done by the Company itself in 2013, we hereby states as follows:
(1) The Company’s board of directors and management team understand their responsibilities of developing, implementing and maintaining the Company’s internal control system, and such a system has been established. The purpose of establishing the internal control system is to reasonably assure the following objectives: (a) The effectiveness and efficiency of business operation (including earnings ,operation performance and the safeguard of company assets); (b) The reliability of the financial and related reports; and (c) The compliance of the relevant laws/regulations and company policies;
(2) Due to the innate limitation in designing a faultless internal control system, this system can only assure the reasonableness of the above three objectives have been fairly achieved. In addition, the effectiveness of internal control system could alter over time due to the change of business environment or situation. Since the Company’s internal control system has included self-examination capability, the Company will make immediate corrections when errors are detected.
(3) The evaluation of effectiveness of the internal control system design and implementation is made in accordance with the “Guidelines for the Establishment of Internal Control Systems by Public Companies” (the Guidelines). The Guidelines are made to examine the following five factors during the management and control process: (1) control environment, (2) risk assessment and response, (3) control activities, (4) information and communication, and (5) supervision. Each factor also includes several items. Details of each factor can be found in the Guidelines.
(4) The Company has examined the effectiveness of each respected area in the internal control system based on the Guidelines.
(5) The examination result indicated that the Company’s internal control system (including subsidiary governance) dated December 31, 2013 has effectively assured that the following objectives have been reasonably achieved during the assessing period: (a) The degree that effectiveness and efficiency of business operation; (b) The reliability of the financial and related reports; (c) The compliance of the relevant laws/regulations and company policies
(6) This Statement is a significant part of the Company’s annual report and prospectus available to the general public. If it contains false information or omits any material content, the Company is in violation of Article 20, Article 32, Article 171 and Article 174 set forth in the Taiwan’s Security and Exchange Act.
44 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (7) The Company hereby declares that this statement had been approved by the Board of Directors on 03/28/2014. Among the 6 attending Directors, no one raised any objection to the contents of this statement.
Hon Hai Precision Industry Co., Ltd.
Chairman: Gou, Tai-ming [signature and seal]
President: Gou, Tai-ming [signature and seal]
45 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (b) The Company is required by the Security and Futures Commission to hire an accountant to audit the Company’s internal control system and disclose the audit report made by accountants:
None
(11) Lawful punishment inflicted on the Company, and/or disciplinary action taken by the Company against its employees for violating internal regulations in the latest year and up to the printing date of this Annual Report); important errors committed; and correction and improvement procedures:
None
(12) Important resolutions made by the Shareholders’ Meeting and Board of Directors by the end of 2013 and the printing date of the annual report
(a) The resolutions approved by the entire attending shareholders at the General Meeting of Shareholders on June 26, 2013 and its implementation
(1) Resolutions:
The Company convened the General Meeting of Shareholders on June 26, 2013, and passed (a) 2012 business operation report and 2012 audited financial statements; (b) distribution of 2012 profits; (c) issuance of new common shares for capital increase by retained earnings; (d) Issuance of new shares for employee Restricted Stock Awards ; (e) Amendment to “Procedures for Lending Funds to Others”; (f) Amendment to “Procedures for Endorsements & Guarantees”; (g) Amended the Articles of Incorporation; (h) Election of Directors and Supervisors; (i) Lifting of director of non-competition restrictions.
(2) Implementation:
A. Profit distribution and issuance of new shares for capital increase by retained earnings: the new shares for capital increase by retained earnings was listed and traded on October 28, 2013; and the cash dividend was distributed on October 16, 2013.
B. For the issuance of new common shares for cash by capital increase and proposed issuance of Global Depositary Receipts (“GDRs”): There is no such condition.
(b) Important resolutions of the Board of Directors from 2013 to April 30, 2014
(1) March 25, 2013
Ratified year 2012 annual financial statements, consolidated financial statements case; issue the common shares for cash by capital increase and proposed; issuance of Global Depositary Receipts (“GDRs”) case; issuance of new shares for employee Restricted Stock Awards case; amended the Procedures for Lending Funds to Others, Procedures for Endorsements & Guarantees; elected Directors and Supervisors; approved the lifting of director of non-competition restrictions; set shareholders general meeting date and calling reasons case; Tried to approve shareholder proposals and lists of Directors, supervisors; modified the Rules of Procedure for Board of Directors Meetings; in response to
46 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 amendments to the Act, proposed modifications of the voting method in shareholders general meeting regarding to the year 1999 overseas issued GDR holders; provided endorsement guarantee to its overseas subsidiary Competition Team Ireland Ltd. for applying the short-term capital needs; invested Funeng Energy Technology Service (Nanyang) Co., Ltd. in China; sold MediaMarkt (China) International Retail Holding Ltd. shares; approved 2012 Statement of Internal Controls; ratified obtained machineries & equipment case; approved 2011 managers and employees bonus appropriation proposal.
(2) May 14, 2013
The Company drafted the distribution of 2012 profit; proposed the issuance of new shares for capital increase by retained earnings; amended the articles of incorporation; review the list of director candidates; review the list of independent director candidates; review the list of supervisor candidates; for the needs of working capital turnover and interest or foreign exchange rate risk management, applied the short-term credit line (within 1 year) to financial institution and signed the contract; provided guarantee to its subsidiary Foxconn (Fast East) Limited in Cayman Islands for borrowing joint loan; provided endorsement guarantee to its overseas subsidiary Foxconn Precision Trading Limited for applying the bank loans; issued domestic unsecured common corporate bonds to raise medium- and long-term funds; the Company's investment in mainland China, Foxconn Precision Electronics (Yantai) Co., Ltd. merged with FuTaiConn Electronics R & D (Yantai) Co., Ltd.; indirect investment in the establishment of OdeYuan (Zhengzhou) Environmental Technology Co., Ltd..
(3) June 25, 2013
In response to the product, market and customer needs, the Company and its subsidiaries conduct organizational restructuring and transformation; indirect capital increase to the Fuding Electronical Technology (Jiashan) Co. Ltd; ratified year 2012 managers and employees’ year-end bonus and performance bonus appropriation proposal.
(4) August 13, 2013
The Company formulated the distribution base day for the issuance of new shares for capital increase by retained earnings of 2012; granting date and ex-dividend base day for cash dividend of 2013; indirectly increase funds to Fox Energy Technology (Funing) Co. Ltd.; indirect investment in the establishment of Ade (Changchun) Co., Ltd., Xiangtai (Changchun) Technology Co., Ltd., Intai (Changchun) Technology Co., Ltd.; Mainland China investment structure adjustments; in response to the product, market and customer needs, the Company and its subsidiaries conduct organizational restructuring and transformation; provided endorsement guarantee to its overseas subsidiaries for applying the short-term credit line; for the needs of working capital turnover and interest or foreign exchange rate risk management, applied the short-term credit line (within 1 year) to financial institution and signed the contract; paid to directors and supervisors; the appointment of members of the Compensation Committee.
(5) November 13, 2013
Issued short-term non-guarantee commercial notes to meet the needs of operation turnover; for the needs of working capital turnover and interest or foreign exchange rate
47 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 risk management, applied the short-term credit line (within 1 year) to financial institution and signed the contract; lent Funds to reinvestment company AMBIT Corporation for 4G mobile communication license and operation needs; increased funds to AMBIT Corporation; invested enterprise in China, Tianjin Funa Yuanchuang Technology Co., Ltd. overseas investment structure adjustment; indirect investment in the establishment of Guiyang Funa Yuanchuang Technology Co., Ltd., Chongqing Hung Teng Technology Co., Ltd.; invested in the establishment of Scienbizip Consulting (SZ) Ltd.; indirectly increased funds to Scienbizip Consulting (SZ) Ltd.; indirect investment in the establishment of 101 Online Education Technology Co., Ltd.; got Fubo Industrial (Shenzhen) Co., Ltd. shares; approved disposition of the Company's assets; set year 2014 Annual Audit Plan; approved 2012 manager and employee bonus appropriation proposal; amended “Manager Performance Evaluation and Salary Compensation Rules” and “Directors, Supervisors, Compensation and Reward Allocation Rules”.
(6) March 28, 2014
Ratify 2013 financial statements of the Company and consolidated financial statements, propose to conduct a cash capital increase by means of the issuance of common shares to participate in Global Depositary Receipts (“GDRs”) offerings; amended the “Procedures for Asset Acquisition & Disposal”; approved “Lifting of Director non-competition restrictions” case; set 2014 Shareholders General Meeting date and reasons for calling; formulated the shareholder proposals; in order to raise medium- and long-term funds, the Company issued the domestic unsecured common corporate bonds; for the needs of working capital turnover and interest or foreign exchange rate risk management, applied the short-term credit line (within 1 year) to financial institution and signed the contract; for the needs of working capital turnover and interest or foreign exchange rate risk management, applied the short-term credit line (with no quota of recourse factoring facility or derivative financial instruments) to financial institution and signed the contract; the Company’s reinvestment companies, for the needs of working capital turnover in 2014, need to submit with BOD approved “Letter of Support” for applying the short-term credit line (within 1 year) to financial institution; for the needs of working capital turnover and interest or foreign exchange rate risk management, applied the short-term credit line to financial institution and signed the contract; guaranteed to the Company's overseas subsidiaries, Competition Team Technology Limited, Falcon Precision Trading Limited and Best Leap Enterprises Limited for applying the short-term turnover credit-line Shared facilities from banks; indirect investment in the establishment of Fuguiconn Precision Electronics (Guizhou) Co., Ltd., Yuding Precision Electronics (Huaian) Co., Ltd., Qingding Precision Electronics (Huaian) Co., Ltd.; indirectly increased funds to Futaiconn Electronics R & D (Yantai) Co., Ltd., Kunshan Yisheng Machinery Industrial Co., Ltd., Yantai Zhengyi Precision Electronics Co., Ltd., Dongguan Yihong Precision Mold Co., Ltd.; indirect investment in the establishment of Fujian Robot Technology (Shenzhen) Co., Ltd. (tentative name), Cifu Technology (Zhengzhou) Co., Ltd. (tentative name), Cifu Technology (Jiyuan) Co., Ltd. (tentative name), Keichi International (Shenzhen) Co., Ltd. (tentative name), Yoer Materials Technology (Shenzhen) Co., Ltd. (tentative name), Jinjihu Precision Machinery (Shenzhen) Co., Ltd. (tentative name), Jinji Trading Center (Linyi) Co., Ltd. (tentative name); overseas investment structure adjustment for invested enterprises in China; approved 2013 Statement of Internal Controls; appointed the members of the Compensation Committee.
48 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (13) Directors or supervisors have expressed opposition or qualified opinions that have been noted in the record or declared in writing in connection with the important resolutions passed by the Board of Directors in the latest year and up to the printing date of this Annual Report:
None
(14) During the latest year and up to the printing date this Annual Report), the Company’s chairman, general manager, accounting director, financial director, internal auditors, R&D supervisor had been:
None
49 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 C. Information on Accountants’ Fees
(1) Range of accountants’ fee
Inspection CPA Firm Name of accountant Remarks period PricewaterhouseCoopers Hsu, Yong-jian Xue, Ming-ling 2013 - Taiwan
Unit: NT$Thousand
Fee items Audit fee Non-audit fee Total Range of amount 1 Under 2 million 2 2 million(included) ~ 4 million V 3 4 million(included) ~ 6 million 4 6 million(included) ~8 million 5 8 million(included) ~ 10 million 6 Over 10 million (included) V V
(2) The non-audit fee paid to certified CPA, certified Office of CPA and affiliated companies accounts for over 1/4 to audit fee:
N/A
(3) Alter the CPA Firm and the audit fee in altering year is less than that in the previous year:
None
(4) The audit fee is reduced by over 50% compared with the previous year:
None
50 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 D. Alternation of CPA
(1) About the Former CPA:
Replacement Date January 1, 2014 The original CPAs of the Company were Yong-Jian Hsu and Ming-Ling Shue from PwC Taiwan. Due to internal Replacement reasons and explanations adjustments of PwC Taiwan, the CPAs of the Company have been changed to Han-Chi Wu and Ming-Hui Chang, beginning January 1, 2014. Parties The CPA Descriptions whether the Company Status Company terminated or the CPA did not accept the Termination of appointment - - appointment No longer accept - - (continued) appointed Other than unqualified issues in the audit None reports within last two years Accounting principles or - practices Disclosure of Financial - Statements Yes - Audit scope or steps Differences with the Company - Others - None V
Descriptions Other Revealed Matters (Required to be disclosed by Accounting Standards Article None 10 section 5 first paragraph item 4)
(2) About the Successor CPA:
Firm Name PwC Taiwan
CPA Nmae Han-Chi Wu, Ming-Hui Chang
Date of appointment April 11, 2014 Consulting results regarding accounting methods or accounting principles to specific transactions or None opinions on the financial statements before appointment Successor CPA written disagreements to former None CPA
(3) Reply of the Previous Accountant: N/A
51 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 E. The Company’s chairman, general manager, or any managerial officer in charge of finance or accounting matters has in the most recent year held a position at the accounting firm of its CPA or at an affiliated enterprise:
None
52 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 F. Transfer & pledge of stock equity by directors, supervisors, managerial officers and holders of 10% or more of company shares:
None
(1) Changes in Equity
Unit: share 2013 Current year to 04/30 Title Name Shareholding Pledged Shares Shareholding Pledged Shares Increase/Decrease Increase/Decrease Increase/Decrease Increase/Decrease Chairman Terry Gou 147,398,953 10,000,000 0 0 Representative of Hongqiao International Investment Co., Ltd.: Director 1,865,789 0 0 0 Tai, Jeng-wu Representative of Hongjing International Investment Co., Ltd.: Director 130,281 0 0 0 Lu, Fang-ming Director Chien, Yi-bin 145,732 0 (177,000) 0
Director Huang, Qing-Yuan 0 0 0 0
Independent Director Wu, Yu-Chi 0 0 0 0
Independent Director Liu, Cheng-Yu 0 0 0 0
Supervisor Wan, Jui-hsia 0 0 0 0 Representative of Furui International Investment Co., Ltd.: Supervisor 5,653,639 1,800,000 0 0 Cho, Min-Chi Department General Manager Tai, Jeng-wu (1,719,105) 0 (410,000) 0
Department General Manager You, Xiang-fu 3,664,328 0 0 0
Department General Manager Lu, Fang-ming 1,618,386 0 (504,000) 0
Department General Manager Jiang, Hao-liang (31,913) 0 0 0
Department General Manager Chien, Yi-bin 145,732 0 (177,000) 0
Department General Manager Xu, Mu-ji (1,087,523) 0 (693,000) 0
53 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 2013 Current year to 04/30 Title Name Shareholding Pledged Shares Shareholding Pledged Shares Increase/Decrease Increase/Decrease Increase/Decrease Increase/Decrease Department General Manager Zhong, Yi-wen 86,404 0 (9,000) 0
Department General Manager Ling, Zhi-ping 233,906 0 (396,000) 0
Department General Manager Xiong, Bing-zheng 100,841 0 0 0
Head Office General Manager Li, Jin-ming 893,537 0 (155,000) 0
Financial Director Huang, De-cai 570,481 0 (414,000) 0
Accounting Director Chou, Zong-kai (61,750) 0 0 0
(2) Information on equity transfer: The counterparties of equity transfer are not related parties.
(3) Information on equity pledge: The counterparties of share pledges are not related parties.
54 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 G. Information on relation among top ten shareholders
Spouse & Minor Shares Held Shareholding Minor through Other Parties Related Party (Note) Name Shareholding Shares held Remark Number % Number % Number % Name Relation
Terry Gou 1,621,388,489 12.35 - - - - None None - Citibank Hosting Hon Hai Precision Industry Co., 283,161,117 2.16 - - - - None None - Ltd. Depositary Receipts Account Citibank Hosting Government of Singapore 263,386,901 2.01 - - - - None None - Investment Account Chase Bank Hosting Central Bank of Saudi Arabia 232,151,439 1.77 - - - - None None - Investment Account Standard Chartered Bank hosting Sanskrit Vanguard 201,729,645 1.54 - - - - None None - Emerging Markets Equity Index Fund account JP Morgan Chase Bank hosting Abu Dhabi 176,266,844 1.34 - - - - None None - Investment Authority Investment Account JP Morgan Hosting ABP pension fund account 152,296,099 1.16 - - - - None None - JP Morgan Chase Bank hosting Norwegian Central 147,658,265 1.13 - - - - None None - Bank Investment Account Standard Chartered Bank Hosting the Fidelity Puritan 141,000,000 1.07 - - - - None None - Trust: Fidelity low-priced stocks Fund China Trust Commercial Bank: Trustee of the 110,001,452 0.84 - - - - None None - property trust Note: Names and relationship of any of the top ten shareholders being a related party as defined in the Statement of Financial Accounting Standards No. 6 or relatives within 2 nd degree of kinship.
55 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 H. Combined shareholding percentage
03/31/2014; unit: 1,000 shares Investment by directors, Investment by the Company supervisors, managers, direct or Combined investment Shift in investment indirect control groups Shares % Shares % Shares % Foxconn (Far East) Ltd. 4,063,145 100.00% - - 4,063,145 100.00% Hongyang Venture Capital (Shenzhen) Co., Ltd. 467,025 97.50% 11,975 2.50% 479,000 100.00% Baoxin International Investment Co., Ltd. 721,000 100.00% - - 721,000 100.00% Margini Holdings Ltd. 275,890 100.00% - - 275,890 100.00% Ambit International Ltd. 53,100 100.00% - - 53,100 100.00% Foxconn Holdings B.V.-Netherland 107,723 100.00% - - 107,723 100.00% Foxconn Technology Co., Ltd. 130,450 9.98% 258,793 19.81% 389,243 29,79% Foxconn Holding Ltd. 114,030 100.00% - - 114,030 100.00% Hongyuan International Investment Co., Ltd. 297,000 100.00% - - 297,000 100.00% Hongqi International Investment Co., Ltd. 280,700 100.00% - - 280,700 100.00% Foxconn Singapore Pte. Ltd. 53,038 100.00% - - 53,038 100.00% Foxconn SA B.V. 72,163 97.76% - - 72,163 97.76% Pan-International Industrial Corp. 107,240 20.79% 29,473 5.72% 136,713 26.51% Liyi International Investment Co., Ltd. 96,900 100.00% - - 96,900 100.00% Sanchuang Digital Co., Ltd. 143,646 73.47% - - 143,646 73.47% PREMIER IMAGE TECHNOLOGY (HK) LTD. 1,405 1.63% 84,753 98.33% 86,158 99.96% Yangxin Technologies Co., Ltd. 7,873 64.58% 4,317 35.42% 12,190 100.00% AMBIT Corporation 600,000 99.01% 6,000 0.99% 606,000 100.00% Note: Long-term equity investment of the Company calculated according to the equity method.
56 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 IV. Company Shares and Fund Raising
A. Company capital and shares
(1) Capital and Shares
04/27/2014; Unit: 1,000 shares Authorized Capital Issued shares Options, bonds, Type Non-issued warrants, other Outstanding Total Total Shares convertible Shares shares Registered Common Shares 13,128,707 13,128,707 1,371,293 500,000 15,000,000 (Listed Stock)
(2) Sources of Capital
Unit: NT$1,000; 1,000 shares Authorized capital stock Paid-in capital Remarks Property other Issue than Year/ Approval date price Source of capital cash month Shares Amount Shares Amount and document (NT$) (NT$1,000) offset by No. the number of shares Capital increase NT$93,000 by 10 1991/06 100,000 1,000,000 80,300 803,000 earnings None - 42 Capital increase NT$90,000 by cash Capital increase NT$132,850 by earnings 1992/07 10 100,000 1,000,000 97,600 976,000 None - Capital increase NT$40,150 by capital reserve Capital increase NT$103,200 by earnings 1993/08 10 150,000 1,500,000 112,800 1,128,000 None - Capital increase NT$48,800 by capital reserve Capital increase NT$118,600 by earnings 1994/08 10 150,000 1,500,000 130,300 1,303,000 None - Capital increase NT$56,400 by capital reserve Capital increase June 19, 1995 1995/06 10 250,000 2,500,000 187,900 1,879,000 None NT$445,700 by (84), TCZ(I) No.
57 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Authorized capital stock Paid-in capital Remarks Property other Issue than Year/ Approval date price Source of capital cash month Shares Amount Shares Amount and document (NT$) (NT$1,000) offset by No. the number of shares earnings 36224 Capital increase NT$130,300 by capital reserve Capital increase October 09, 1995 1995/10 48 250,000 2,500,000 227,900 2,279,000 NT$400,000 by None (84), TCZ(I) No. cash 52879 Capital increase July 9, 1996 (85), 1996/10 10 450,000 4,500,000 358,000 3,580,000 NT$1,301,000 by None TCZ(I) No. 41678 earnings Capital increase NT$1,108,400 by June 30, 1997 earnings 1997/09 10 600,000 6,000,000 511,800 5,118,000 None (86), TCZ(I) No. Capital increase 51749 NT$429,600 by capital reserve Capital increase NT$1,818,560 by July 10, 1998 earnings 1998/08 10 1,000,000 10,000,000 734,600 7,346,000 None (87), TCZ (I) No. Capital increase 58651 NT$409,440 by capital reserve Capital increase June 30, 1999 1999/08 10 1,300,000 13,000,000 1,050,000 10,500,000 NT$3,154,000 by None (88),TCZ(I) No. earnings 58593 Capital increase August 9, 1999 220.7 1999/11 1,300,000 13,000,000 1,100,000 11,000,000 NT$500,000 by None (88),TCZ(I) No. 5 cash 63098 Capital increase June 22, 2000 2000/08 10 2,400,000 24,000,000 1,452,900 14,529,000 NT$3,529,000 by None (89),TCZ(I) No. earnings 54010 Capital increase June 13, 2001 2001/08 10 2,400,000 24,000,000 1,768,780 17,687,800 NT$3,158,800 by None (90), TCZ(I) No. earnings 137713 Capital increase June 27, 2002 2002/08 10 3,000,000 30,000,000 2,064,897 20,648,970 NT$2,961,170 by None (91), TCZ(I) No. earnings 135225 Capital increase June 12, 2003 2003/08 10 3,000,000 30,000,000 2,519,174 25,191,744 NT$4,542,774 by None (92), TCZ(I) No. earnings 920128415 Capital increase January 27, 2004 2004/07 10 3,600,000 36,000,000 2,757,198 27,571,989 NT$2,380,244 by None (93), TCZ(I) No. merging 920162759 Capital increase NT$4,738,011 by July 21, 2004, 2004/10 10 4,600,000 46,000,000 3,231,023 32,310,231 earnings; Converse None JGZYZ NT$231 Euro - No.0930132689 convertible bond
58 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Authorized capital stock Paid-in capital Remarks Property other Issue than Year/ Approval date price Source of capital cash month Shares Amount Shares Amount and document (NT$) (NT$1,000) offset by No. the number of shares Converse 2005/05 10 4,600,000 46,000,000 3,238,718 32,387,189 NT$76,957 Euro - None - convertible bond Converse 2005/08 10 5,300,000 53,000,000 3,284,525 32,845,251 NT$458,061 Euro - None - convertible bond Capital increase January 29, 2005, 2005/09 10 5,300,000 53,000,000 4,003,171 40,031,717 NT$7,186,466 by None JGZYZ earnings No.0940131076 Converse 2005/11 10 5,300,000 53,000,000 4,038,323 40,383,231 NT$351,514 Euro - None - convertible bond Converse 2006/04 10 5,300,000 53,000,000 4,099,953 40,999,534 NT$616,303 Euro - None - convertible bond Capital increase July 11, 2006, 2006/09 10 5,700,000 57,000,000 4,989,944 49,899,441 NT$8,899,907 by None JGZYZ earnings No.0950129699 Capital increase October 19, 2006, 2007/03 10 5,700,000 57,000,000 5,168,139 51,681,388 NT$1,781,947 by None JGZYZ merging No.0950147071 Capital increase July 09, 2007, 2007/09 10 7,000,000 70,000,000 6,290,767 62,907,665 NT$11,226,277 by None JGZYZ earnings No.0960035148 Capital increase June 30, 2008, 2008/10 10 8,120,000 81,200,000 7,414,623 74,146,235 NT$11,238,569 by None JGZYZ earnings No.0970032402 Capital increase April 28, 2009, 2009/06 10 9,300,000 93,000,000 8,578,932 85,789,319 NT$11,643,084 by None JGZYZ earnings No.0980017596 Capital increase July 01, 2010, 2010/09 10 10,820,000 108,200,000 9,661,248 96,612,482 NT$10,823,163 by None JGZFZ earnings No.0990034120 Capital increase June 20, 2011, 2011/08 10 12,230,000 122,300,000 10,689,097 106,890,967 NT$10,278,485 by None JGZFZ earnings No.1000028108 Capital increase July 5, 2012 2012/09 10 12,230,000 122,230,000 11,835,867 118,358,665 NT$11,467,698 by None JGZFZ No. earnings 1010029788 Capital increase July 29, 2013 2013/10 10 15,000,000 150,000,000 13,128,707 131,287,068 NT$12,928,403 by None JGZFZ No. earnings 1020029486
(3) Information on shelf registration system:
None
59 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (4) Shareholder Structure
04/27/2014
Shareholder Foreign Financial Juridical Private Structure Governments institutions & Total institutions Person Investors foreigners Quantity Members 9 274 876 550,624 2,443 554,226 Total shares held 391,383,088 742,817,253 379,156,326 5,188,184,473 6,427,165,700 13,128,706,840 Shareholdings 2.98% 5.66% 2.89% 39.52% 48.95% 100.00% (%)
(5) Distribution of Shares
(a) Distribution of common shares
04/27/2014
Shares Members Total Shares held Shareholdings (%)
1-999 127,666 36,413,339 0.28% 1,000 to 5,000 288,261 651,067,607 4.96% 5,001 to 10,000 70,744 500,658,597 3.81% 10,001 to 15,000 27,255 331,073,577 2.52% 15,001 to 20,000 11,774 206,102,739 1.57% 20,001 to 30,000 11,395 276,894,717 2011% 30,001 to 40,000 5,006 173,834,377 1.32% 40,001 to 50,000 2,895 130,177,295 0.99% 50,001 to 100,000 4,985 343,036,182 2.61% 100,001 to 200,000 1,983 271,349,782 2.07% 200,001 to 400,000 856 238,856,773 1.82% 400,001 to 600,000 295 143,704,942 1.10% 600,001 to 800,000 176 121,833,388 0.93% 800,001 to 1,000,000 127 115,159,265 0.88% Above 1,000,001 808 9,588,544,260 73.03% Total 554,226 13,128,706,840 100.00%
(b) Diversification of preferred stocks:
The Company doesn’t issue preferred stocks.
60 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (6) List of major shareholders
04/27/2014 Shares Shareholdings Shares held Major Shareholder’s name (%)
Terry Gou 1,621,388,489 12.35% Citibank Hosting Hon Hai Precision Industry Co., Ltd. 283,161,117 2.16% Depositary Receipts Account Citibank Hosting Government of Singapore Investment 263,386,901 2.01% Account Chase Bank Hosting Central Bank of Saudi Arabia 232,151,439 1.77% Investment Account Standard Chartered Bank hosting Sanskrit Vanguard 201,729,645 1.54% Emerging Markets Equity Index Fund account JP Morgan Chase Bank hosting Abu Dhabi Investment 176,266,844 1.34% Authority Investment Account JP Morgan Hosting ABP pension fund account 152,296,099 1.16% JP Morgan Chase Bank hosting Norwegian Central Bank 147,658,265 1.13% Investment Account Standard Chartered Bank Hosting the Fidelity Puritan Trust: 141,000,000 1.07% Fidelity low-priced stocks Fund China Trust Commercial Bank: Trustee of the property trust 110,001,452 0.84%
61 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (7) Information on Market Price, Equity, Earnings, Dividends Per Share & Relatives
Year Current year to 2012 2013 Item March 31, 2014
Before 117.00 89.9 Highest adjustment 87.00 Market Price Per After adjustment 105.00 80.36 Before Share 79.00 68.8 (Note 1) Lowest adjustment 78.9 After adjustment 70.45 61.18 Average 92.89 78.46 83.36 Before distribution 54.06 58.24 60.09 Equity Per Share After distribution 47.77 - - Weighted average shares (1,000 11,798,513 13,074,723 13,127,274 Earnings per shares) share Before Earnings per 8.03 8.16 1.49 (Note 2) adjustment share (NT$) After adjustment 7.27 - - Cash dividend 1.5 1.8 - Stock Dividends Appropriated 1.0 1.2 - from Retained Dividends per Earnings Stock Dividends share Stock Dividends (Note 3) Appropriated None None - from Capital Reserve Accumulated Unappropriated None None - Dividends P/E ratio 11.47 9.62 - Investment Price-dividend ratio 61.93 43.59 - return analyses Cash dividend yield 1.63% 2.29% - Note 1: The market price per share shall be adjusted by stock dividends. Note 2: The earnings per share shall be adjusted by stock dividends. Note 3: 2013 dividends have not yet been approved by the AGM.
(8) Dividend Policy and Execution Status
(a) Dividend policy
The Company is in a growth stage, therefore, it will expand with the development of its business in the future. The distribution of earnings shall be planned by the Board of Directors according to the Company’s budget on capital expenditure and fund demand. And the earnings shall be distributed after the Shareholders’ Meeting works out a resolution. For the distribution of shareholder dividend, no more than 90% of the stock dividends allocated in the year shall be distributed in the form of cash.
62 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (b) Distribution of stock dividends at this Shareholders’ Meeting:
(i) Shareholder stock dividend: Since 2013, the Company allotted NT $ 15,754,448,210 to issue new shares through capitalization, with 120 shares to every 1,000 shares. After gaining the approval of the General Meeting of Shareholders and reporting to the authorities for approval, the Board of Directors shall formulate the base day for distribution.
(ii) Shareholder cash dividend: Since 2013, the Company allotted NT$23,631,672,312 as cash dividend, with NT$1.8 for each share. After gaining the approval of the General Meeting of Shareholder, the Board of Directors shall formulate the base day for distribution.
(9) Influence of non-compensated distribution of shares and the present occasion on the Company’s business performance, earnings per share, and shareholder rights
Year 2014 Item (estimate)
Amount of paid-in capital in opening period (NT$) 13,128,706,840
Cash dividend per share (NT$) 1.8 Dividend Stock dividends per share for capital increase by retained earnings Distribution 0.12 (Shares) (Note 1) Stock dividends per share for capital increase by capital reserve - (Shares) Operating profit
Change in operating profit compared with the previous year
After-tax net profit Business Performance Change in after-tax net profit compared with the previous year N/A (Note 2) Variation Earnings per share
Change in earnings per share compared with the previous year
Average return on investment (Average annual EP ratio) If retained earnings for capital increase all Pro forma EPS N/A (Note 2) converted to cash dividends Pro forma average ROI Pro forma earnings Pro forma EPS If no capital increase by capital reserve N/A (Note 2) per share and Pro forma average ROI price/earnings ratio If no capital increased by capital reserve but Pro forma EPS capital increase by earnings shifted to cash N/A (Note 2) dividends Pro forma average ROI Note 1: Pending resolution by 2013 Annual General Shareholders’ Meeting. Note 2: Hon Hai is not required to disclose its 2014 financial forecast pursuant to “Regulations Governing the Publication of Financial Forecasts of Public Companies.”
63 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (10) Employee dividends and remuneration of directors and supervisors:
(a) Information on employee dividends and director/supervisor remuneration, as set forth in the Company’s articles of incorporation:
The Company’s annual net profit shall be settled and distributed according to the following sequence:
(1) Cover the deficit
(2) Make provision ten percent as legal reserve
(3) Make provision of other special reserves according to laws and regulations.
(4) 8% is employee dividend. The objects the employee stock dividend distributed to shall include employees of subsidiaries complying with the conditions. The relevant methods shall be formulated by the Board of Directors.
(5) For the rest, the Board of Directors shall formulate the profit distribution plan according to the Company’s dividend policy.
(b) The basis of estimating the amount of employees’ bonus and remuneration of directors/supervisors for the current period, and the accounting treatment of the discrepancy, if any, between the actual distributed amount of employees’ stock bonus and estimated figure thereof:
(1) The employee dividend shall take the percentage as estimating basis after considering the legal reserve from after-tax net profit; the remuneration of directors and supervisors shall take the profit distribution approved by the Board of Directors as the estimating basis.
(2) The total number of employee divided stocks to be issued shall be determined by the closing price of the day before the meeting date, and taking into account the influence of the ex-right and ex-dividend factors. Employee divided of less than one share shall be distributed in cash.
(3) Where the discrepancy between actually distributed and estimated amount has been confirmed by the resolution of the shareholder meeting, it shall be recognized as the loss and profit of the following year.
(c) Information on the amount of employee dividend, remuneration of directors and supervisors and the calculation of earnings per share as approved by the Board of Directors:
(1) The cash dividend distributed to employee shall be NT$0 and remuneration to directors and supervisors shall be NT$0.
64 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (2) The employee stock dividend shall be NT$7,682,195,281, accounting for 6.7164% of the total after-tax net profit and employee dividend in the individual or respective financial report of this period.
(3) The earnings per share of any proposed distribution of employee dividends and director/supervisor compensation shall be NT$8.06.
(4) In the case of any differences between the actual distributed and recognized number, please state the difference, reasons and response:
The Company’s actually distributed number is of no difference with the recognized one.
(d) Actual distribution of employee dividends, remuneration of directors/supervisors in the previous year:
(1) Actual distribution
Unit: NT$ Employee dividends Remuneration to Employee Stock Dividends: Employee Stock Dividends: Employee Cash Directors and Amount Number of Shares Dividends Supervisors
6,822,891,067 109,253,660 44 0 Note: NT$62.45 per share is determined as the calculating basis by the closing price of the Company on June 15, 2012 and taking account of the influence of the ex-right and ex-dividend factors.
(2) In the case of any differences between the actual distributed and recognized number, please state the difference, reasons and response:
The Company’s actually distributed number does not differ from the recognized one.
(11) Share repurchases:
None
65 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 B. Section on Corporate Bonds
(1) Corporate Bonds
Unit: NT$ 2005 Unsecured Corporate Bonds, 2009 Unsecured 2010 Unsecured 2011 Unsecured Corporate Bond Type Phase I Corporate Bonds, Corporate Bonds, Corporate Bonds, Phase I Phase I Phase I Bonds A-E
September 22, 2005 - Issuing (handling) date October 6, 2009 December 27, 2010 March 8, 2011 September 28, 2005
Denomination 1,000,000 1,000,000 1,000,000 1,000,000 Issuing and transaction Market (listed) Market (listed) Market (listed) Market (listed) location Issue price Issue by denomination Issue by denomination Issue by denomination Issue by denomination Total amount 2,500,000,000 6,820,000,000 6,000,000,000 6,000,000,000 Interest rate 2.37% 1.72% 1.43% 1.47% 10-year period 5-year period 5-year period 5-year period Due date: September Deadline Due date: October 6, Due date: December Due date: March 8, 22, 2015 - September 2014 27, 2015 2016 28, 2015 Guarantee Agency None None None None Bank SinoPac Bank SinoPac Bank SinoPac Bank SinoPac Consignee Company Limited Company Limited Company Limited Company Limited Underwriting institution None None None None Certified lawyer None None None None CPA None None None None Respectively repay Respectively repay Respectively repay 50% in the fourth and Repayment in lump 50% in the fourth and 50% in the fourth and Repayment method fifth years from the sum upon maturity fifth years from the fifth years from the expiration of issue expiration of issue date expiration of issue date date Outstanding principal 2,500,000,000 3,410,000,000 6,000,000,000 6,000,000,000 Terms of redemption or None None None None advance repayment Restrictive clause None None None None Rating agency: Rating agency: Rating agency: Rating agency: Name of credit rating China Credit Rating China Credit Rating China Credit Rating China Credit Rating agency Co., Ltd. Co., Ltd. Rating Co., Ltd. Rating Co., Ltd. Rating Rating date Rating date: August date: December 26, date: December 3, date: December 21, Rating of corporate bonds 23, 2005 2008 2010 2010 Rating result: twAA Rating result: twAA+ Rating result: twAA+ Rating result: twAA+
66 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 As of the printing date of this Annual Report, amount of (exchanged or subscribed) N/A N/A N/A N/A Other ordinary shares, rights GDRs or other attached securities converted: Issuance and conversion (exchange or None None None None subscription) method Issuance and conversion, exchange or subscription method, issuing condition None None None None dilution, and impact on existing shareholders’ equity
Transfer Agent None None None None
Unit: NT$
2011 Unsecured Corporate Bonds, Phase II 2011 Unsecured 2012 Unsecured Corporate Bond Type Corporate Bonds, Corporate Bonds, Bond A Bond B Bond C Phase III Phase I Issuing (handling) date June 14, 2011 June 14, 2011 June 14, 2011 July 18, 2011 March 1, 2012 Denomination 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 Issuing and transaction Market (listed) Market (listed) Market (listed) location Issue by Issue by Issue price Issue by denomination denomination denomination Total amount 3,000,000,000 2,650,000,000 1,400,000,000 4,950,000,000 9,000,000,000 Interest rate 1.43% 1.66% 1.82% 1.51% 1.34% 5-year period 7-year period 10-year period 5-year period 5-year period Deadline Due date: Due date: Due date: Due date: July 18, Due date: March 1, June 14, 2016 June 14, 2018 June 14, 2021 2016 2017 Guarantee Agency None None None Bank SinoPac Bank SinoPac Consignee Bank SinoPac Company Limited Company Limited Company Limited Underwriting institution None None None Certified lawyer None None None CPA None None None Repayment in lump Repayment in lump Repayment method Repayment in lump sum upon maturity sum upon maturity sum upon maturity
Outstanding principal 3,000,000,000 2,650,000,000 1,400,000,000 4,950,000,000 9,000,000,000 Terms about redemption None None None or advance repayment
67 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Restrictive clause None None None Rating agency: Rating agency: Name of credit rating Rating agency: China Credit Rating China Credit Rating agency: China Credit Rating Co., Ltd. Co., Ltd. Co., Ltd. Rating date: Rating date: May 19, 2011 Rating date: June 23, Rating date: Rating of corporate Rating result: twAA+ 2011 December 16, 2011 bonds: Rating result: twAA+ Rating result: twAA+ As of the printing date of this Annual Report, amount of (exchanged or subscribed) NA NA NA Other ordinary rights shares, GDRs attached or other securities converted: Issuance and conversion (exchange or None None None subscription) method Issuance and conversion, exchange or subscription method, issuing condition None None None dilution, and impact on existing shareholders’ equity Transfer Agent None None None
Unit: NT$ 2013 Unsecured Corporate 2012 Unsecured 2012 Unsecured 2012 Unsecured Bonds, Phase I Corporate Bond Type Corporate Bonds, Corporate Bonds, Corporate Bonds, Phase II Phase III Phase IV Note A Note B
Issuing (handling) date May 23, 2012 August 6, 2012 October 11, 2012 102.1.30 102.1.30
Denomination 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 Issuing and transaction Market (listed) Market (listed) Market (listed) Market (listed) location Issue price Issue by denomination Issue by denomination Issue by denomination Issue by denomination
Total amount 6,000,000,000 8,000,000,000 3,300,000,000 7,450,000,000 3,600,000,000 Interest rate 1.43% 1.18% 1.35% 1.33% 1.45% 5-year 7-year period 5-year period 3-year period 5-year period period Deadline Due date: Due date: 05/23/2017 Due date:08/06/2015 Due date: 10/11/2017 Due date: 01/30/2020 01/30/2018 Guarantee Agency None None None None Bank SinoPac Bank SinoPac Bank SinoPac Bank SinoPac Company Consignee Company Limited Company Limited Company Limited Limited
68 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Underwriting institution None None None None Certified lawyer None None None None CPA None None None None
Repayment in lump Repayment in lump Repayment in lump Repayment in lump sum Repayment method sum upon maturity sum upon maturity sum upon maturity upon maturity
Outstanding principal 6,000,000,000 8,000,000,000 3,300,000,000 7,450,000,000 3,600,000,000 Terms about redemption None None None None or advance repayment Restrictive clause None None None None Rating agency: Rating agency: Rating agency: Rating agency: Name of credit rating China Credit Rating China Credit Rating China Credit Rating China Credit Rating Co., agency: Co., Ltd. Co., Ltd. Co., Ltd. Ltd. Rating date: Rating date: April 24, Rating date: July 11, Rating date: Rating date: September Rating of corporate bonds: 2012 2012 September 12, 2012 12, 2012 Rating result: twAA+ Rating result: twAA+ Rating result: twAA+ Rating result: twAA+ As of the printing date of this Annual Report, amount of (exchanged or subscribed) N/A N/A N/A N/A ordinary Other shares, GDRs rights or other attached securities converted: Issuance and conversion (exchange or None None None None subscription) method Issuance and conversion, exchange or subscription method, issuing condition None None None dilution, and impact on None existing shareholders’ equity
Transfer Agent None None None None
Unit: NT$
2013 Unsecured 2013 Unsecured Corporate Bonds, Phase III Corporate Bond Type Corporate Bonds, Phase II Note A Note B Note C
Issuing (handling) date October 18, 2013 December 12, 2013 December 12, 2013 December 12, 2013
Denomination 1,000,000 1,000,000
69 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Issuing and transaction Market (listed) Market (listed) location Issue price Issue by denomination Issue by denomination
Total amount 6,950,000,000 3,000,000,000 800,000,000 2,200,000,000 Interest rate 1.45% 1.35% 1.50% 1.85%
3-year period 3-year period 5-year period 7-year period Deadline Due date: 10/18/2016 Due date:12/17/2016 Due date: 12/17/2018 Due date: 12/17/2020
Guarantee Agency None None Bank SinoPac Consignee Bank SinoPac Company Limited Company Limited Underwriting institution None None Certified lawyer None None CPA None None
Repayment in lump Repayment method Repayment in lump sum upon maturity sum upon maturity
Outstanding principal 6,950,000,000 3,000,000,000 800,000,000 2,200,000,000 Terms about redemption None None or advance repayment Restrictive clause None None Rating agency: Name of credit rating China Credit Rating agency: Co., Ltd. N/A Rating date: Rating date: April 16, Rating of corporate bonds: 2013 Rating result: twAA+ As of the printing date of this Annual Report, amount of (exchanged or subscribed) N/A N/A ordinary Other shares, GDRs rights or other attached securities converted: Issuance and conversion (exchange or None None subscription) method Issuance and conversion, exchange or subscription method, issuing condition None None dilution, and impact on existing shareholders’ equity Transfer Agent None None
70 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Unit: NT$ 2014 Unsecured Corporate Bonds, Phase I Corporate Bond Type Note A Note B Note C Note D
Issuing (handling) date March 18, 2014 March 18, 2014 March 18, 2014 March 18, 2014
Denomination 1,000,000 Issuing and transaction Market (listed) location Issue price Issue by denomination
Total amount 2,050,000,000 1,100,000,000 350,000,000 250,000,000 Interest rate 1.23% 1.40% 1.75% 2.0%
3-year period 5-year period 7-year period 10-year period Deadline Due date: 03/18/2017 Due date:03/18/2019 Due date:03/18/2021 Due date:03/18/2024
Guarantee Agency None
Consignee Bank SinoPac Company Limited
Underwriting institution None Certified lawyer None CPA None
Repayment method Repayment in lump sum upon maturity
Outstanding principal 2,050,000,000 1,100,000,000 350,000,000 250,000,000 Terms about redemption None or advance repayment Restrictive clause None
Name of credit rating agency: N/A Rating date: Rating of corporate bonds:
As of the printing date of this Annual Report, amount Other of (exchanged or rights subscribed) N/A attached ordinary shares, GDRs or other securities converted:
71 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 Issuance and conversion (exchange or None subscription) method Issuance and conversion, exchange or subscription method, issuing condition None dilution, and impact on existing shareholders’ equity Transfer Agent None
72 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (2) Convertible Bonds
None
(3) Information about exchangeable bonds:
None
(4) Information about shelf registration to issue corporate bonds:
None
(5) Information about bonds with attached warrants:
None
C. Preferred Shares (with warrants):
None
D. Global Depository Receipts (GDR)
Up to April 30, 2014, the total amount of global depository receipts issued had been 282,503,027. (The stock dividends issued was increased by 9,000,000 units in 2000; increased by 7,712,055 units in 2001; 6,576,842 units in 2002; 9,849,149 units in 2003; 10,331,442 units for capital increase by merging and 8,233,870 units of stock dividends in 2004; 16,859,728 units in 2005; 22,166,888 units in 2006; 24,277,009 units in 2007; 17,397,658 units in 2008; 17,977,893 units in 2009; 16,058.934 units in 2010; 14,779,513 units in 2011; 15,619,935 units in 2012; 14,395,019 units in 2013. In addition, by the end of April 30, 2014, the ECB issued 26,296,111 units of GDRs in total.)
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Issue date: Item October 7, 1999 March 17, 2005
Issuing location: Europe, Asia, USA Issuing location: Europe, Asia, USA Issuing and transaction location: Transaction location: London Stock Transaction location: London Stock Exchange Exchange
Total amount: USD 416,700,000 USD 257,178,618.20
Unit issue price: USD 13.89 USD 8.7577 (1) 25,000,000 units Total of issued unit (2) 5,000,000 units 29,366,000 units 30,000,000 units in total (1) Issuance of new shares for cash increase The Company’s common shares held Source of negotiable securities (2) The Company’s common shares by the original shareholders held by the original shareholders Amount of negotiable securities 60,000,000 common shares 58,732,000 common shares
1. Right to vote 1. Right to vote GDR holders’ 2. Right to distribute dividend, 2. Right to distribute dividend, rights and obligations subscribe new shares and other rights subscribe new shares and other rights
Consignee None None
Depository Bank Citibank N. A Citibank N. A
Custodian Bank Citibank N. A, Taipei Branch Citibank N. A, Taipei Branch
Outstanding balance 141,300,499 Unit (negotiable securities 282,601,003 shares)
Method to share the expenses Issue cost: amortized by the issuing companies and shareholder participants incurred during the issuance and according to the actual shares issued duration Expenses incurred in the duration: amortized by the issuing company
Important conventions about The depositary institute performs the obligations for GDR holders, while the depositary and escrow guarantee agency keeps GDR common shares. agreement (unit: USD) (unit: unit per price Market Highest 6.145
2012 Lowest 4.55
Average 5.255
Current Highest 5.845 year to Lowest 5.205 04/30/2013 Average 5.547
E. Subscription of warrants for employees:
None
74 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 F. Name of managers holding warrants for employees and top ten employees in terms of subscription of warrants, and the acquisition status:
None
G. Subscription of new shares for employee restricted stocks:
None
H. Name of managers holding the new shares for employee restricted stocks and top ten employees in terms of subscription of the new share, and the acquisition status:
None
I. Issuance of new shares for merging and transferring the stocks of other companies:
None
(1) During the latest year and up to the printing date of this Annual Report, if the Company has merged or transferred the stocks of other companies for issuing new shares:
(a) The assessment prepared by the managing underwriter concerning the issuance of new shares by merging or transferring the stocks of other companies within the past quarter:
None
(b) The implementation status of the past quarter. If the progress or benefit of such implementation is not as good as expected, its impact on shareholders’ equity and an improvement plan shall be state specifically:
N/A
(2) The merger or issuance of new shares approved by the Board of Directors during the latest year and up to the printing date of this Annual Report:
None
J. Implementation of fund usage plan:
The Company doesn’t issue any uncompleted plan or completed one with unrealized benefit within the latest three years.
75 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 V. Operational Highlights
A. Business Activities
(1) Business scope
(a) Major content of business activities
IT, communications, automation devices, photo-electricity, precise machinery, auto, production, sales and service related with connectors, casings, radiators, assembled parts of consuming electronics as well as assembly of network cables. The products manufactured by the Company include:
(1) I/O product line: IN-PUT, OUT-PUT connectors.
(2) IC line packaging and product line of expansion memory: connector for IC line and memory IC expansion bracket.
(3) Product line of system connector: electrical coupler of host and branch system.
(4) Product lines of network connection and output & input device: terminal, scanner, keyboard, monitor, mouse, network integrated connecting cables.
(5) Photo-electricity connecting product line: optical connectors and connecting wire network used in digital network.
(6) Compound connectors with electronic processing functions: filtering connectors, static-free connectors and high frequency connectors.
(7) EISA graphics card connectors under new industrial standard: expansion slot connectors with open framework.
(8) Casings, radiators, spare parts processed by precision metal, engineering plastic module, precise machinery components used in IT products, Bare System and consuming electronic products.
(9) Assembly and processing of memory card
(10) Broadband communications, wireless mobile communications and end-to-end communication products
(11) Ethernet switch and wireless network products
(b) Operational proportion
100% of the products are 3C electronics (Computer, Communication, Consumer Electronics). The output and sales volume of recent two years can be found in the Production and Sales Table.
(2) Technology and R&D
76 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (a) Current product items
The Company’s products cover the spares parts, modules and system assemblies for 3C electronics. The spare parts may include 3C connectors, line assembled products and other spare parts; the modules may include the machinery modules (e.g. the casing of 3C products) and electronic modules (e.g. surface adhesive product for 3C products); the system assembly is mainly for finished 3C products.
(b) New commodities to be developed
As for the R&D of new products, the Company will focus on connectors such as compound, modular, high frequency, photo-electricity and surface-mounted connectors. Besides, it will follow the trend and make its computers and accessories lighter, thinner, shorter, smaller, more surface-mounted and modularized as well as integrated with communications.
(c) R&D expenses for recent years
Unit: NT$Thousand Year 2013 Jan-Mar., 2014 R&D Expenses 46,580,031 9,774,707 R&D Expenses to Revenue % 1.18% 1.11%
77 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 B. Production and Sales Status
(1) Key Accounts in the Past Two Years
(a) Key Suppliers
Unit: NT$million 2012 2013 As of end of Q1, 2014 Percentage of Percentage Relationship Relationship Relationship total Net of total Net Percentage of total Item From Amount with the From Amount with the From Amount with the Purchases Purchases Net Purchases (%) issuer issuer issuer (%) (%) 1 Vendor ac 760,977 26% Note 1 Vendor L 904,857 27% Nil Vendor L 188,283 26% Nil 2 Vendor af 445,389 15% Note 1 3 Vendor ag 400,306 14% Note 1 Other 1,331,113 45% Other 2,427,438 73% Other 546,704 74% Total Net Total Net Total Net 2,937,785 100% 3,332,295 100% 734,989 100% Purchases Purchases Purchases Note 1: Indirect investment subsidiary of the Company. Note 2: Changes were due to market trend dynamics and customer demand variation.
78 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (b) Key Buyers
Unit: NT$million 2012 2013 As of end of Q1, 2014 Percentage of Relationship Percentage Percentage of Relationship Relationship Item From Amount total Net with the From Amount of total Net From Amount total Net Sales with the with the issuer Sales (%) issuer Sales (%) (%) issuer 1 Customer E 1,865,774 47.77% Nil Customer E 2,001,215 50.64% Nil Customer E 420,775 47.63% Nil 2 Customer C 459,975 11.78% Nil Customer C 398,527 10.08% Nil Customer C 107,591 12.18% Nil Others 1,579,646 40.45% - Others 1,552,576 39.28% - Others 355,113 40.19% - Total Net Total Net Total Net 3,905,395 100.00% - 3,952,318 100.00% - 883,479 100.00% - Sales Sales Sales Note: Starting from 2013, the Company prepares financial statements in accordance with T-IFRS (Taiwan International Financial Reporting Standards).
(2) Production Value in the Most Recent Years
Unit: 1,000 pcs, NT$Thousand Quantity & 2012 2013 Value
Capacity Quantity Value Capacity Quantity Value Major Product 3C Electronics 24,871,337 21,943,981 3,090,181,680 25,427,789 22,434,938 3,262,836,764
79 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 (3) Sales Value in the Most Recent Years
Unit: 1,000 pcs, NT$Thousand Quantity & 2012 2013 Value Domestic Export Domestic Export
Major Product Quantity Value Quantity Value Quantity Value Quantity Value
3C Electronics 156,408 25,369,524 19,688,931 3,187,695,809 89,053 12,723,259 22,525,911 3,218,355,856 Service and Management Fee － － － 5,863,062 － － － 31,933,781 Incomes
(4) Taiwan Employee Data during the Past Two Years and Up to Apr. 30, 2014
Year 2012 2013 Up to Apr. 30, 2014
Staff 6,568 6,236 6,522 Employee Operator 35 7 7 Number Total 6,603 6,243 6,529 Average Age 38.53 37.73 38.08 Average Seniority 6.34 6.45 6.45 PhD Degree 2.01% 1.91% 1.93% Master Degree 45.49% 49.01% 50.33% Education College 49.37% 46.68% 45.44% Distribution % High School 2.73% 2.19% 2.10% Below High School 0.39% 0.21% 0.18%
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C. Information on Environmental Protection Costs
(1) The loss caused by environmental pollution during the latest year and up to the printing date of this Annual Report:
None
(2)
(a) The main workshops and production facilities of the Company are located in Tucheng Industrial Park or Hsinchu Science Park. The Company takes environmental protection as its priority, and carries out immediate correction once discovering any problem. Besides, it also makes inspection on the existing preventive facilities. Apart from creating a good working and living environment for its employees and the neighborhood, it strictly complies with the discharge standard. For the pollution and wastes generated in the production process, the Company takes the following steps to protect the environment:
(1) Prevention of water pollution: set up wastewater treatment plants and water quality analysis laboratory in Tucheng factory. Chemical method is applied in wastewater treatment, in which pollutants are rid from wastewater and discharged through discharge outlets The lab has various instruments to measure temperature, PH value, chemical oxygen demand and suspended solid and analyze heavy metal, so that daily inspection on discharging water can be made and water discharge can be well controlled. The Company’s factories in Huyue, Minsheng and Hsinchu all received a letter on permit to connect wastewater (or sewage) to the sewer system, under the reference of TFZ No. 1015060021, 0955060439 and YLZ No.0960021733 respectively.
(2) Prevention of stationary pollution source: waste gas is collected by extraction pipes, and released to the air after the pollutants are removed through the wet scrubber. Every year, the Company authorizes other companies to detect the viscosity of pollutants in exhaust gas and report the result to the component department of environmental protection. The Company obtained the Operating Permit of Stationary Pollution Source in 1998 and extended it in June 2008. The permit No. is: BXCZD No. F0447-02.
(3) Cleaning of wastes: Works are done in accordance with the Waste Cleaning Plan, and the disposal of waste is reported online in a legal way, and wastes are legally cleaned and recycled.
(4) Management on toxic chemicals: Toxic chemicals are stored separately and strictly controlled. Moreover, documents on use and inspection are obtained legally, and periodically reported to the component department of environmental protection.
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(b) The Company has been adhering to the environmental policy of “pollution control and prevention, continuous waste reduction, providing environment- friendly products, protecting the earth, creating a green enterprise”, and strictly abiding by laws and regulations on environmental protection and clients’ requirements by means of effectively controlling raw materials, manufacturing process and delivery. Besides, it is dedicated to continuous improvement in order to better product quality, make sure the products free from restricted materials and promote the transformation of upstream suppliers to green supplying chain so as to comply with ROHS requirements.
(c) Current pollution status, the influence of improvement on the Company’s earnings, competitive position and capital expenditure, estimated major expenditure on environmental protection in the following two years:
(1) Estimated expenditure on environmental protection in the next two years
Unit: NT$1,000 2015 2016 Expense or equipment to be purchased for None None pollution control Predicted improvement None None
Amount paid None None
(2) Influence after improvement
• Influence on net profit None None • Influence on competitive position None None
D. Labor Relations
Current important labor agreement and implementation:
The Company has been treating its employees with sincerity and established mutual trust with them through its welfare system and good training system that guarantee a fulfilling and stable life for them. Though there is no union in the Company, but the Company has established “Workers and Employers Meeting” and meets regularly pursuant to the law, over the years, its employees can give full play to their team spirit, coordinate the Company’s decision, cooperate with each other to create a harmonious environment for working. The Company pursuant to the relevant labor laws and regulations, to protect the legitimate interests of employees, provides employees with safe and healthy working environment, and set up an employee feedback and complaints mechanism. The Company adopts the followings measures to build a harmonious labor relation:
(1) Welfare measures for employees: establishment of the Welfare Committee for employees
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Founded in April 1985, the Welfare Committee is composed of 13 members, including 4 appointed by the employer and 9 by employees. The committee members are re-elected every three years, and there are dedicated members appointed to deal with the routine administrative works of the Committee. At present, the welfares proposed by the Welfare Committee are as follows:
(a) Food allowance;
(b) Birthday gift (cash or other present);
(c) Lucky draw during get-togethers;
(d) Assistance to employees in club activities and entertainment (build fitness rooms and hand out books);
(e) Consultancy on health and medical care;
(f) Compassionate visit for funerals;
(g) Care for the life of employees living inside and outside the Company;
(h) Cash gift for wedding and childbirth;
(i) Training allowance;
(j) Group insurance.
(2) Career Development and Training for Employees
Training is one of the basic welfares enjoyed by the Company’s employees. The Company encourages its employees to “study in the work and apply what they have learned in the work”, and takes training as a means to improve employee quality and their work skills, promote the group performance, facilitate the realization of its operation target of “long term, stability, development, science and technology, internationality”. The Company formulated the Method on Employee Trainings. Based on this, the Company provided 455,738 hours of trainings in 2013 with the training fees reaching up to NT$32,493,229. The main content of training includes:
(a) Orientation training for new employees
New employees are guided to familiarize the corporate culture, organization development, reformation history and working environment.
(b) Technology and Development Committee
With the horizontal integration of the Technology and Development Committee, employees can join different committees according to their job characteristics and professional fields. The Technology and Development Committee has introduced the latest knowledge and technology in various fields to promote technical exchange among employees and set out a complete training structure for professional technicians.
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(c) Development of management talents
The Company has worked out its own training program to develop management talents at different management level according to their management needs. The training modes are diversified and colorful.
(d) School of advanced manufacturing and productivity
With the launch of the IE School and the industrial transformation of the company group, the Company takes advantage of the training management system and on-line study platform to make the training programs process- oriented, simplified, standardized, systematized, information-based and networked.
(e) Lectures on general knowledge
Mainly include the courses covering IE popularity, safety and health, quality awareness.
(f) Lectures given by celebrities
The Company invites the famous and successful people in various fields to give lectures in the Company.
(g) Library
The Company has a professional library where there are abundant journals and books as well as well-equipped reading rooms and audiovisual apparatus.
(3) Code of conduct or ethics
In order to help employees have a better understanding of ethics, rights, obligations and the code of conduct, the Company hereby works out the relevant measures and regulations to provide basis for all employees. The relevant measures are briefed as follows:
(a) Rules on decision-making right and right decentralization: to improve work efficiency, strengthen the management on right decentralization and effectively standardize the rights of employees at different levels.
(b) Organizational structure and duties of each department: definitely regulate the organizational functions of each unit and the duties of each post.
(c) The Employee Handbook is prepared to help employees understand the relevant measures and regulations.
(1) Tutoring programs for new employees: to eliminate the new employees’ insecurity towards the new environment and soon familiarize the working environment and colleagues after reporting for duty, and help them to get their mind and body ready for work and reduce the turnover rate within a short period.
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(2) Code of business ethics: to improve all employees’ behavioral quality, business ethics and expertise and try to maximize the Company’s benefit within the legal scope. Every employee has the responsibility to prevent the Company’s interests from being lost or impaired and is obliged to maintain the Company’s reputation so as to guarantee its permanent growth and development.
(3) Employee attendance: strengthen the attendance system to establish a good working discipline for employees.
(4) Reward and punishment system: Rewards or punishment are given to employees whose behavior or conduct has brought benefit or loss for the Company in operation.
(5) Leave-related measures for employees: to provide basis for employees to take and ask for a leave.
(6) Performance assessment method for employees: employees’ working achievements and performance are assessed annually as the basis for salary adjustment, promotion, issuance of bonus and arrangement for training courses.
(d) Dormitory regulations: to standardize the conducts, rights and obligations of the employees living in the dormitory.
(4) Working environment and protective measures for employees’ personal safety
(a) The Company continued to maintain the occupational safety and health management system, passed the certification of SGS Company and obtained the OHSAS18001 and CNS15506 certificates in 2013.
(b) The Company has formulated the safety and health policy and promised to achieve the goal of zero injury, zero occupational disease and zero accident so as to create a best working environment for all employees.
(c) The Company was awarded “Annual Labor Safety and Health institutions ─ Excellent Work Award” of the Labor Department and “Outstanding institutions Award” & “Professionalism and safety & health personnel Outstanding Award” of the New Taipei City in July 2013.
(d) Employees’ personal safety
The Company has, according to the Implementation Rules for Public Institutions on Records of Labor-hour without Occupational Injury , taken part in the competition of non-occupational injury record during labor-hour and hit the record of four million and eight hundred thousand labor-hours without occupational injury.
(e) Environmental health
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Based on the annual safety and health management plan, the Company checked the physical and chemical hazardous factors of each department, worked out the working environment inspection plan inclusive of sampling strategies. The plan was approved as qualified by Taipei District Public Prosecutors Office (Taiwan), and the inspection result also complied with the standard, and was announced in the Safety and Hygiene Committee and publicized on the Company’s website and relevant bulletin boards.
(f) Education trainings:
The Company provided 43 safety and health trainings to 1,128 new employees and 72 employees at director level according to its annual training plan.
(5) Retirement System:
The Company has formulated the retirement and pension plans for employees according to the Labor Standards Act and the Labor Pension Act. Since January 1987, the Company legally established the Supervisory Committee of Workers’ Retirement Fund, which is re-elected every three years and in charge of checking the amount, deposit and withdrawal as well as payment of retirement fund so as to ensure employees’ rights.
(6) Other important agreements: None.
(7) Loss suffered from labor disputes in the latest year and up to the printing date of this Annual Report:
The Company has no major dispute on labor relation or labor agreement in the latest year and up to the printing date of this Annual Report.
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VI. Financial Standing
A. Most Recent 5-Year Concise Financial Information
(1) Concise Balance Sheet and Statement of Comprehensive Income- IFRS
Concise Balance Sheet
Unit: NT$Thousand
As of March 31, 2009 2010 2011 2012 2013 Period 2014 (Note 2) Item
Current assets 1,536,206,108 1,808,581,488 1,556,454,468 Net property, plant and equipment 405,155,076 379,561,941 363,411,267 Intangible assets 3,954,469 12,815,278 12,792,396 Other assets 104,922,452 65,219,497 70,373,267 Total assets 2,050,238,105 2,312,461,203 2,049,909,952 Before Distribution 1,252,367,888 1,358,960,771 1,070,385,570 Current liabilities After Distribution 1,270,121,688 Note 1 Note 1 Non-current liabilities 116,956,467 147,575,830 147,424,157 Before Distribution 1,369,324,355 1,506,536,601 1,217,809,727 Total liability After Distribution N/A 1,387,078,155 Note 1 Note 1 Equity attributable to owners of parent 644,849,260 764,670,066 788,967,032 Share capital 118,358,665 131,287,068 131,287,068 Capital surplus 58,932,078 64,792,873 65,116,641
Retained Before Distribution 459,771,861 536,880,165 556,422,928 earnings After Distribution 430,182,195 Note 1 Note 1 Other equity interest 7,805,557 31,728,861 36,159,296 Treasury shares (18,901) (18,901) (18,901) Non-controlling interests 36,064,490 41,254,536 43,133,193 Before Distribution 680,914,750 805,924,602 832,100,225 Total equity After Distribution 663,159,950 Note 1 Note 1 Note 1: As of April 30, 2014, the amount of after distribution has not presented due to the proposal of earnings distribution of year 2013 had not yet been submitted to the shareholders' meeting. Note 2: Numbers are unaudited
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Concise Statement of Comprehensive Income
Unit: NT$Thousand
Period As of March 31, 2009 2010 2011 2012 2013 Item 2014 (Note)
Operating revenue 3,905,395,322 3,952,317,540 883,479,325
Gross profit (loss) from operations 250,249,268 254,694,501 53,375,905
Net operating income (loss) 107,898,270 109,314,396 20,905,719
Non-operating income and expenses 10,273,815 26,981,301 4,635,150 Profit (loss) from continuing operations 118,172,085 136,295,697 25,540,869 before tax Profit (loss) from continuing operations 91,666,736 107,345,876 19,829,790
Loss from discontinuing operations - - -
Net Profit (loss) 91,666,736 107,345,876 19,829,790
Other comprehensive income, net N/A (17,912,758) 24,534,711 4,140,244
Total comprehensive income 73,753,978 131,880,587 23,970,034
Profit (loss), attributable to owners of parent 94,641,972 106,697,157 19,542,763 Profit (loss), attributable to non-controlling (2,975,236) 648,719 287,027 interests Comprehensive income, attributable to 76,791,442 130,621,274 23,973,198 owners of parent Comprehensive income, attributable to non- (3,037,464) 1,259,313 (3,164) controlling interests Basic earnings per share 7.27 8.16 1.49
Note: Numbers are unaudited.
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(2) Concise Balance Sheet and Income Statement – R.O.C. GAAP
Concise Balance Sheet – R.O.C. GAAP
Unit: NT$Thousand Most Recent 5-Year Financial Information Period Item 2009 2010 2011 2012 2013
Current assets 699,574,457 1,022,837,593 1,283,667,822 1,542,957,442 Fund and Long- term equity 55,223,421 52,766,841 49,122,496 63,432,100 investments Fixed assets (Note 390,298,219 1) 234,618,141 272,149,689 355,373,481 Intangible assets 1,793,392 355,298 695,266 3,954,469 Other assets 30,735,878 32,422,700 41,452,360 43,761,287 Total assets 1,021,945,289 1,380,532,121 1,730,311,425 2,044,403,517 Befor Current 1,250,024,307 liabilities e Dist. 475,235,945 771,252,375 991,716,043 After 1,267,778,107 N/A Dist. 492,393,809 780,913,623 1,007,749,688 Long-term 105,688,418 liabilities 62,649,050 87,955,221 115,978,877 Other liabilities 9,349,315 7,878,520 7,597,021 6,959,639 Befor Total 1,362,672,364 liabilities e Dist. 547,234,310 867,086,116 1,115,291,941 After 1,380,426,164 Dist. 564,392,174 876,747,364 1,131,325,586 Common stock 85,789,319 96,612,482 106,890,967 118,358,665 Capital surplus 57,308,705 65,011,063 70,693,639 77,266,078
Befor Retained 445,361,440 earnings e Dist. 265,351,332 315,053,301 377,321,804 After 415,771,774 Dist. 237,898,750 295,730,805 350,599,063 Unrealized gain (loss) of financial 16,902,917 13,265,130 1,802,723 4,169,293 N/A instruments Translation adjustments and 1,395,612 other 14,522,082 -9,330,319 21,141,456 equity adjustment Unrecognized - - - - - pension cost Befor Stockhol 474,710,979 513,446,005 615,019,484 681,731,153 ders’ e Dist. After Equity 457,553,115 503,784,757 598,985,839 663,977,353 Dist.
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Concise Income Statement – R.O.C. GAAP
Unit: NT$Thousand Period Most Recent 5-Year Financial Information
Item 2009 2010 2011 2012 2013
Operating revenue 1,959,182,385 2,997,205,316 3,452,681,273 3,905,395,322
Gross profit t 186,553,448 244,202,187 266,382,484 329,629,037
Operating income 83,489,125 86,145,933 82,845,028 108,450,481 Non-operating 10,367,241 14,481,196 27,442,124 23,932,586 income Non-operating (5,825,402) (9,149,921) (7,750,952) ( 14,003,976) expense Income from continuing 88,030,964 91,477,208 102,536,200 118,379,091 operations before income taxes Net income for continuing 76,380,293 75,472,644 81,934,633 91,787,141 N/A operations Income from discontinued 0 0 0 0 operations Extraordinary 0 0 0 0 gain (loss) Translation adjustments and 0 0 0 0 other equity adjustment Net income 76,380,293 75,472,644 81,934,633 91,787,141 Basic earnings per share (NT$) 5.81 5.93 6.27 7.28 (Note 1) Note 1: EPSs are retroactively adjusted based on the number of shares of stock dividends as of Dec. 31, 2013.
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(3) CPAs and Their Opinions for Most Recent 5-Years
Year Name of CPA Auditor’s Opinion Reason for Changing CPA
2009 Yong-jian Hsu, Modified unqualified － Yan-song Li opinion 2010 Yong-jian Hsu, Modified unqualified － Yan-song Li opinion 2011 Yong-jian Hsu, Modified unqualified Internal administrative Ming-ling Xue opinion organizational changes 2012 Yong-jian Hsu, Modified unqualified － Ming-ling Xue opinion 2013 Yong-jian Hsu, Modified unqualified － Ming-ling Xue opinion
B. Most Recent 5-Year Financial Analysis
(1) Financial Analysis - IFRS
Financial Period Most recent 5-Year Financial Information Information up to Item March 31, 2009 2010 2011 2012 2013 2014
Financial Total liabilities to total assets 66.79% 65.15% 59.41% Ratio (%) Long-term capital to PP&E 196.93% 247.15% 265.71% 145.41% Ability to Current ratio 122.66% 133.09% payoff debt Quick ratio 94.12% 109.60% 116.09% (%) Interest protection 13.31% 17.76% 9.10% A/R turnover (times) 7.00 5.68 5.99 A/R turnover days 52 64 61 Inventory turnover (times) 9.57 10.57 10.14 Ability to Account payable turnover (times) 6.16 5.47 5.50 operate Days sales outstanding 38 35 36 Fixed assets turnover (times) N/A 10.10 10.07 9.51 Total assets turnover (times) 2.06 1.81 1.62 Return on assets (%) 5.24% 5.25% 1.02% Return on equity (%) 14.15% 14.44% 2.42% Earning PBT to pay-in capital % 99.84% 103.82% 19.45% ability Net margin (%) 2.35% 2.72% 2.24% EPS (NT$) 7.27 8.16 1.49 Cash flow ratio (%) 13.85% 12.71% 10.18% Cash flow % Cash flow adequacy ratio (%) 68.44% 87.52% 96.58% Cash reinvestment ratio (%) 15.89% 13.07% 8.93% Operating leverage 5.41 4.69 5.69 Leverage Financial leverage 1.10 1.09 1.18
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Formula:
1. Financial Ratio (1) Total liabilities to Total assets = Total liabilities / Total assets (2) Long-term debts to fixed assets = (Net equity + Long-term debts) / Net fixed assets
2. Ability to Pay off Debt (1) Current ratio = Current Assets / Current liability (2) Quick ratio = (Current assets - Inventory - Prepaid expenses) / Current liability (3) Interest protection = Net income before income tax and interest expense / Interest expense
3. Ability to Operate (1) Account receivable (including account receivable and notes receivable from operation) turnover = Net sales / the Average of account receivable (including account receivable and notes receivable from operation) balance (2) A/R turnover day = 365 / account receivable turnover (3) Inventory turnover = Cost of Goods Sold / the average of inventory (4) Account payable (including account payable and notes payable from operation)turnover = Cost of goods sold / the average of account payable (including account payable and notes payable from operation) balance (5) Inventory turnover day = 365 / Inventory turnover (6) Fixed assets turnover = Net sales / Net Fixed Assets (7) Total assets turnover = Net sales / Total assets
4. Earning Ability (1) Return on assets = [PAT + Interest expense × (1 - interest rate)] / the average of total assets (2) Return on equity = PAT / the average of net equity (3) Net income ratio = PAT / Net sates (4) EPS = (PAT - Dividend from prefer stock) / weighted average outstanding shares
5. Cash Flow (1) Cash flow ratio = Cash flow from operating activities / Current liability (2) Cash flow adequacy ratio = Most recent 5-year Cash flow from operating activities / Most recent 5-year (Capital expenditure + the increase of inventory + cash dividend) (3) Cash investment ratio = (Cash flow from operating activities - cash dividend) / (Gross fixed assets + long-term investment + other assets + working capital)
6. Leverage
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(1) Operating leverage = (Nest revenue - variable cost of goods sold and operating expense) / operating income (2) Financial leverage = Operating income / (Operating income - interest expenses)
(2) Financial Analysis – R.O.C. GAAP
Period Most recent 5-Year Financial Information
Item 2009 2010 2011 2012 2013
Financial Total liabilities to total assets 53.55% 62.81% 64.46% 66.65% Ratio % Long-term capital to PP&E 229.04% 220.98% 205.7% 201.75% Ability to Current ratio 147.21% 132.62% 129.44% 123.43% payoff debt Quick ratio 107.49% 97.8% 89.54% 94.29% (%) Interest protection 47.12% 34.55% 18.98% 13.34% A/R turnover (times) 6.74 8.26 7.73 7.00 A/R turnover days 54 44 47 52 Inventory turnover (times) 9.69 11.94 9.56 9.36 Ability to Account payable turnover (times) 6.26 7.57 6.53 6.03 operate Days sales outstanding 38 31 38 39 Fixed assets turnover (times) 8.02 11.83 11.00 10.47 Total assets turnover (times) 2.06 2.50 2.22 2.07 N/A Return on assets (%) 8.21% 6.47% 5.56% 5.26% Return on equity (%) 17.58% 15.28% 14.52% 14.16% Earning To pay-in Operating income 97.32% 89.17% 77.50% 91.63% ability capital % PBT 102.61% 94.68% 95.93% 100.02% Net margin (%) 3.90% 2.52% 2.37% 2.35% EPS (NT$) 5.81 5.93 6.27 7.28 Cash flow ratio (%) 21.03% 8.10% 10.21% 14.38% Cash flow Cash flow adequacy ratio (%) 72.87% 63.06% 56.38% 68.44% Cash reinvestment ratio (%) 13.77% 6.00% 10.08% 16.55% Operating leverage 3.09 3.72 4.68 4.57 Leverage Financial leverage 1.02 1.03 1.07 1.10
Formula:
1. Financial Ratio (1) Total liabilities to Total assets = Total liabilities / Total assets (2) Long-term debts to fixed assets = (Net equity + Long-term debts) / Net fixed assets
2. Ability to Pay off Debt (1) Current ratio = Current Assets / Current liability (2) Quick ratio = (Current assets - Inventory - Prepaid expenses) / Current liability (3) Interest protection = Net income before income tax and interest expense / Interest expense
93 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
3. Ability to Operate (1) Account receivable (including account receivable and notes receivable from operation) turnover = Net sales / the Average of account receivable (including account receivable and notes receivable from operation) balance (2) A/R turnover day = 365 / account receivable turnover (3) Inventory turnover = Cost of Goods Sold / the average of inventory (4) Account payable (including account payable and notes payable from operation)turnover = Cost of goods sold / the average of account payable (including account payable and notes payable from operation) balance (5) Inventory turnover day = 365 / Inventory turnover (6) Fixed assets turnover = Net sales / Net Fixed Assets (7) Total assets turnover = Net sales / Total assets
4. Earning Ability (1) Return on assets = [PAT + Interest expense × (1 - interest rate)] / the average of total assets (2) Return on equity = PAT / the average of net equity (3) Net income ratio = PAT / Net sates (4) EPS = (PAT - Dividend from prefer stock) / weighted average outstanding shares
5. Cash Flow (1) Cash flow ratio = Cash flow from operating activities / Current liability (2) Cash flow adequacy ratio = Most recent 5-year Cash flow from operating activities / Most recent 5-year (Capital expenditure + the increase of inventory + cash dividend) (3) Cash investment ratio = (Cash flow from operating activities - cash dividend) / (Gross fixed assets + long-term investment + other assets + working capital)
6. Leverage (1) Operating leverage = (Nest revenue - variable cost of goods sold and operating expense) / operating income (2) Financial leverage = Operating income / (Operating income - interest expenses)
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C. Audit Report by Supervisors
The Board reports the financial statement, business report, and earnings distribution proposal of 2013, and financial statement have been audited by PricewaterhouseCoopers Taiwan. The financial statements, business report and earnings distribution proposal have been audited by us as Supervisors of the Company. We deem no inappropriateness on these documents. Pursuant to Article 219 of the Company Act, we hereby present the audited report. Please review.
Submitted to:
2014 Regular Shareholders’ Meeting of the Company
Hon Hai Precision Industry Co., Ltd.
Supervisor: Wan, Jui-hsia
On the Date of May 16, 2014
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Audit Report by Supervisors
The Board reports the financial statement, business report, and earnings distribution proposal of 2013, and financial statement have been audited by PricewaterhouseCoopers Taiwan. The financial statements, business report and earnings distribution proposal have been audited by us as Supervisors of the Company. We deem no inappropriateness on these documents. Pursuant to Article 219 of the Company Act, we hereby present the audited report. Please review.
Submitted to:
2014 Regular Shareholders’ Meeting of the Company
Hon Hai Precision Industry Co., Ltd.
Supervisor: Fu-Rui International Investment Co., Ltd.
Representative: Chuo, Min-chih
On the Date of May 16, 2014
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D. 2012 Financial Statements Consolidated With Subsidiaries Audited by CPA
HON HAI PRECISION INDUSTRY CO., LTD. AND SUBSIDIARIES CONSOLIDATED FINANCIAL STATEMENTS AND REPORT OF INDEPENDENT ACCOUNTANTS
DECEMBER 31, 2013 AND 2012
For the convenience of readers and for information purpose only, the auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. In the event of any discrepancy between the English version and the original Chinese version or any differences in the interpretation of the two versions, the Chinese-language auditors’ report and financial statements shall prevail.
97 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
REPORT OF INDEPENDENT ACCOUNTANTS TRANSLATED FROM CHINESE
To the Board of Directors and Stockholders: Hon Hai Precision Industry Co., Ltd. We have audited the accompanying consolidated balance sheets of Hon Hai Precision Industry Co., Ltd. and subsidiaries as of December 31, 2013, December 31, 2012 and January 1, 2012, and the related consolidated statements of comprehensive income, of changes in equity and of cash flows for the years ended December 31, 2013 and 2012. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We did not audit the financial statements of certain consolidated subsidiaries which statements reflect total assets of NT$165,841,382,000, NT$147,874,948,000 and NT$245,803,235,000, constituting 7.17%, 7.21% and 14.17% of the consolidated total assets as of December 31, 2013, December 31, 2012 and January 1, 2012, respectively, and total revenues of NT$158,844,046,000 and NT$154,940,895,000, constituting 4.02% and 3.97% of the consolidated total operating revenues for the years ended December 31, 2013 and 2012, respectively. Those statements were audited by other auditors whose reports thereon have been furnished to us, and our opinion expressed herein, insofar as it relates to the amounts and the information disclosed in Note 13 are based solely on the reports of the other independent accountants.
We conducted our audits in accordance with the “Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants” and generally accepted auditing standards in the Republic of China. 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 and the reports of the other independent accountants provide a reasonable basis for our opinion.
In our opinion, based on our audits and the reports of other independent accountants, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Hon Hai Precision Industry Co., Ltd. and subsidiaries as of December 31, 2013, December 31, 2012 and January 1, 2012, and their financial performance and cash flows for the years ended December 31, 2013 and 2012, in conformity with the “Rules Governing the Preparation of Financial Statements
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by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission (FSC).
We have also audited the parent company only financial statements of Hon Hai Precision Industry Co., Ltd. as of and for the years ended December 31, 2013 and 2012, on which we have expressed a modified unqualified opinion on such financial statements.
PricewaterhouseCoopers, Taiwan March 28, 2014
‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and report of independent accountants are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice. As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.
99 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 HON HAI PRECISION INDUSTRY CO., LTD. CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2013, DECEMBER 31, 2012 AND JANUARY 1, 2012 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)
December 31, 2013 December 31, 2012 January 1, 2012 Assets Notes AMOUNT % AMOUNT % AMOUNT % Current assets 1100 Cash and cash 6(1) equivalents $ 694,027,045 30 $ 505,526,956 25 $ 329,793,633 19 1110 Financial assets at fair 6(2) value through profit or loss - current 1,198,112 - 140,220 - 70,329 - 1125 Available-for-sale 6(3) financial assets - current 1,087,171 - 777,410 - 674,287 - 1170 Accounts receivable, 6(4) net 727,761,542 31 597,578,990 29 450,757,984 26 1180 Accounts receivable - 7 related parties 19,948,258 1 35,469,651 2 25,291,811 2 1200 Other receivables 6(5) and 7 40,215,354 2 38,235,975 2 34,679,896 2 130X Inventory 6(6) 312,785,092 14 349,882,643 17 380,521,794 22 1410 Prepayments 6,393,753 - 7,647,041 - 7,119,919 - 1470 Other current assets 6(7) and 8 5,165,161 - 947,222 - 46,741,750 3 11XX Total current assets 1,808,581,488 78 1,536,206,108 75 1,275,651,403 74 Non-current assets 1510 Financial assets at fair 6(2) value through profit or loss - non-current - - 179,300 - - - 1523 Available-for-sale 6(3) financial assets - non- current 11,854,684 1 12,498,717 1 9,365,511 - 1543 Financial assets carried 6(8) at cost - non-current 10,843,376 - 8,591,982 - 4,018,056 - 1550 Investments accounted 6(9) for under equity method 46,282,999 2 41,958,943 2 37,792,058 2 1600 Property, plant and 6(10) equipment 379,561,941 16 405,155,076 20 368,166,092 21 1760 Investment property - 6(11) net 2,304,839 - 1,231,003 - 1,345,340 - 1780 Intangible assets 6(12) 12,815,278 1 3,954,469 - 695,266 - 1840 Deferred income tax 6(35) assets 15,837,041 1 10,951,902 1 10,560,705 1 1900 Other non-current 6(13) and 8 assets 24,379,557 1 29,510,605 1 27,340,133 2 15XX Total non-current assets 503,879,715 22 514,031,997 25 459,283,161 26 1XXX Total assets $ 2,312,461,203 100 $ 2,050,238,105 100 $ 1,734,934,564 100
(Continued)
100 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 HON HAI PRECISION INDUSTRY CO., LTD. CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2013, DECEMBER 31, 2012 AND JANUARY 1, 2012 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)
December 31, 2013 December 31, 2012 January 1, 2012 Liabilities and Equity Notes AMOUNT % AMOUNT % AMOUNT % Current liabilities 2100 Short-term loans 6(14) $ 366,233,601 16 $ 297,572,165 15 $ 260,522,749 15 2110 Short-term notes and 6(15) bills payable 19,982,517 1 7,991,597 - 7,989,312 - 2120 Financial liabilities at 6(2) fair value through profit or loss - current 39,946 - 82,055 - 251,834 - 2170 Accounts payable 682,942,409 30 602,755,794 29 519,725,102 30 2180 Accounts payable - 7 related parties 29,761,739 1 35,614,847 2 28,769,177 2 2200 Other payables 6(16) 191,175,178 8 196,267,554 10 123,145,854 7 2230 Current income tax 6(35) liabilities 24,158,478 1 19,177,206 1 19,939,503 1 2250 Provisions for liabilities 6(23) - current 2,406,336 - 3,464,280 - 7,302,884 - 2300 Other current liabilities 6(17) 42,260,567 2 89,442,390 4 25,879,538 2 21XX Total current liabilities 1,358,960,771 59 1,252,367,888 61 993,525,953 57 Non-current liabilities 2500 Financial liabilities at 6(2) fair value through profit or loss - non-current - - - - 470,158 - 2530 Corporate bonds 6(18) payable 97,054,788 4 74,980,461 4 62,378,777 4 2540 Long-term loans 6(19) 35,108,728 2 30,707,957 2 53,600,100 3 2570 Deferred income tax 6(35) liabilities 6,218,103 - 4,148,965 - 3,927,601 - 2600 Other non-current 6(22) liabilities 9,194,211 - 7,119,084 - 6,256,685 1 25XX Total non-current liabilities 147,575,830 6 116,956,467 6 126,633,321 8 2XXX Total liabilities 1,506,536,601 65 1,369,324,355 67 1,120,159,274 65 Equity Equity attributable to owners of parent Share capital 6(24) 3110 Share capital - common stock 131,287,068 6 118,358,665 6 106,890,967 6 Capital surplus 6(25) 3200 Capital surplus 64,792,873 3 58,932,078 3 53,206,711 3 Retained earnings 6(26) 3310 Legal reserve 69,456,739 3 59,980,502 3 51,821,402 3 3350 Undistributed earnings 467,423,426 20 399,791,359 19 340,192,127 20 Other equity interest 6(27) 3400 Other equity interest 31,728,861 1 7,805,557 - 25,495,188 1 3500 Treasury stocks 6(24) ( 18,901 ) - ( 18,901) - ( 18,901) - 31XX Equity attributable to owners of the parent 764,670,066 33 644,849,260 31 577,587,494 33 36XX Non-controlling interest 6(28) 41,254,536 2 36,064,490 2 37,187,796 2 3XXX Total equity 805,924,602 35 680,913,750 33 614,775,290 35 Commitments and 9 contingent liabilities Subsequent events 11 Total liabilities and equity $ 2,312,461,203 100 $ 2,050,238,105 100 $ 1,734,934,564 100
The accompanying notes are an integral part of these consolidated financial statements. See report of independent accountants dated March 28, 2014.
101 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 HON HAI PRECISION INDUSTRY CO., LTD. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2013 AND 2012 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS, EXCEPT FOR EARNINGS PER SHARE AMOUNTS)
2013 2012 Items Notes AMOUNT % AMOUNT % 4000 Operating revenue 6(29) and 7 $ 3,952,317,540 100 $ 3,905,395,322 100 5000 Operating costs 6(6)(32)(33) and 7 ( 3,697,623,039) ( 93) ( 3,655,146,054) ( 93 ) 5900 Net operating margin 254,694,501 7 250,249,268 7 Operating expenses 6(32)(33) and 7 6100 Selling expenses ( 25,893,690) ( 1) ( 25,638,619) ( 1) 6200 General and administrative expenses ( 72,906,384) ( 2) ( 71,046,632) ( 2) 6300 Research and development expenses ( 46,580,031) ( 1) ( 45,665,747) ( 1) 6000 Total operating expenses ( 145,380,105) ( 4) ( 142,350,998) ( 4) 6900 Operating profit 109,314,396 3 107,898,270 3 Non-operating income and expenses 7010 Other income 6(30) 17,531,778 1 18,019,845 - 7020 Other gains and losses 6(31) 13,863,801 - ( 497,971) - 7050 Finance costs 6(4)(34) ( 9,252,353) - ( 9,786,423) - 7060 Share of profit of associates and 6(9) joint ventures accounted for under equity method 4,838,075 - 2,538,364 - 7000 Total non-operating income and expenses 26,981,301 1 10,273,815 - 7900 Profit before income tax 136,295,697 4 118,172,085 3 7950 Income tax expense 6(35) ( 28,949,821) ( 1) ( 26,505,349) ( 1) 8200 Profit for the year $ 107,345,876 3 $ 91,666,736 2 Other comprehensive income 8310 Financial statements translation 6(27)(28) differences of foreign operations $ 24,617,695 - ($ 18,737,151) - 8325 Unrealized (loss) gain on valuation 6(27)(28) of available-for-sale financial assets ( 1,002,017) - 1,755,830 - 8360 Actuarial gain (loss) on defined 6(20) benefit plan 980 - ( 193,854) - 8370 Share of other comprehensive 6(27) income (loss) of associates and joint ventures accounted for under equity method 918,220 - ( 770,538) - 8399 Income tax relating to the 6(35) components of other comprehensive income ( 167) - 32,955 - 8300 Other comprehensive income (loss) for the year $ 24,534,711 - ($ 17,912,758) - 8500 Total comprehensive income for the year $ 131,880,587 3 $ 73,753,978 2 Profit (loss) attributable to: 8610 Owners of the parent $ 106,697,157 3 $ 94,641,972 2 8620 Non-controlling interest 648,719 - ( 2,975,236) - $ 107,345,876 3 $ 91,666,736 2 Comprehensive income attributable to: 8710 Owners of the parent $ 130,621,274 3 $ 76,791,442 2 8720 Non-controlling interest 1,259,313 - ( 3,037,464) - $ 131,880,587 3 $ 73,753,978 2
Earnings per share 6(36) 9750 Basic earnings per share $ 8.16 $ 7.27 9850 Diluted earnings per share $ 7.99 $ 7.11
The accompanying notes are an integral part of these consolidated financial statements. See report of independent accountants dated March 28, 2014.
102 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 HON HAI PRECISION INDUSTRY CO., LTD. CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2013 AND 2012 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)
Equity attributable to owners of the parent Retained earnings Other equity interest Financial statements translation Unrealized gain or differences of loss on valuation of Share capital - Undistributed foreign available-for-sale Non-controlling Notes common stock Capital surplus Legal reserve earnings operations financial assets Treasury stocks Total interest Total
2012 Balance at January 1, 2012 $ 106,890,967 $ 53,206,711 $ 51,821,402 $ 340,192,127 $ 21,047,357 $ 4,447,831 ($ 18,901 ) $ 577,587,494 $ 37,187,796 $ 614,775,290 Appropriations of 2011 earnings (Note 1): Legal reserve 6(26) - - 8,159,100 ( 8,159,100 ) ------Cash dividends 6(26) - - - ( 16,033,645 ) - --( 16,033,645 )-( 16,033,645 ) Stock dividends 6(26) 10,689,096 - - ( 10,689,096 ) ------Employees’ stock bonus 6(24) 778,602 5,095,950 - - - -- 5,874,552 - 5,874,552 Consolidated net income for 2012 - - - 94,641,972 - -- 94,641,972 ( 2,975,236 ) 91,666,736 Other comprehensive income (loss) for 2012, net 6(27) of income tax - - - ( 160,899 ) ( 19,676,846 ) 1,987,215 - ( 17,850,530 ) ( 62,228 ) ( 17,912,758 ) Changes in equity of associates and joint ventures accounted for under the equity method - 595,577 - - - -- 595,577 - 595,577 Adjustments arising from changes in percentage 6(28) of ownership in subsidiaries - 33,840 - - - -- 33,840 - 33,840 Increase in non-controlling interests 6(28) ------1,914,158 1,914,158 Balance at December 31, 2012 $ 118,358,665 $ 58,932,078 $ 59,980,502 $ 399,791,359 $ 1,370,511 $ 6,435,046 ($ 18,901 ) $ 644,849,260 $ 36,064,490 $ 680,913,750 2013 Balance at January 1, 2013 $ 118,358,665 $ 58,932,078 $ 59,980,502 $ 399,791,359 $ 1,370,511 $ 6,435,046 ($ 18,901 ) $ 644,849,260 $ 36,064,490 $ 680,913,750 Appropriations of 2012 earnings (Note 2): Legal reserve 6(26) - - 9,476,237 ( 9,476,237 ) ------Cash dividends 6(26) - - - ( 17,753,800 ) - --( 17,753,800 )-( 17,753,800 ) Stock dividends 6(26) 11,835,866 - - ( 11,835,866 ) ------Employees’ stock bonus 6(24) 1,092,537 5,730,354 - - - -- 6,822,891 - 6,822,891 Consolidated net income for 2013 - - - 106,697,157 - -- 106,697,157 648,719 107,345,876 Other comprehensive income for 2013, net of 6(27) income tax - - - 813 25,062,436 ( 1,139,132 ) - 23,924,117 610,594 24,534,711 Changes in equity of associates and joint ventures accounted for under the equity method - 112,116 - - - -- 112,116 - 112,116 Adjustments arising from changes in percentage 6(28) of ownership in subsidiaries - 18,325 - - - -- 18,325 - 18,325 Increase in non-controlling interests 6(28) ------3,930,733 3,930,733 Balance at December 31, 2013 $ 131,287,068 $ 64,792,873 $ 69,456,739 $ 467,423,426 $ 26,432,947 $ 5,295,914 ($ 18,901 ) $ 764,670,066 $ 41,254,536 $ 805,924,602
Note1: Directors' and supervisors' remuneration amounting to $0 and employees' bonus amounting to $5,874,552 had been deducted from the consolidated income statement. Note 2: Directors' and supervisors' remuneration amounting to $0 and employees' bonus amounting to $6,822,891 had been deducted from the consolidated income statement.
The accompanying notes are an integral part of these consolidated financial statements. See report of independent accountants dated March 28, 2014.
103 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 HON HAI PRECISION INDUSTRY CO., LTD. CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2013 AND 2012 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)
Notes 2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES Consolidated profit before tax for the year $ 136,295,697 $ 118,172,085 Adjustments to reconcile net income to net cash provided by operating activities Income and expenses having no effect on cash flows Depreciation 6(32) 72,686,853 67,490,681 Amortization 6(32) 926,373 392,646 Provision for doubtful accounts and sales discount 227,523 388,623 Loss on impairment of non -financial assets 6(9)(10) 577,807 3,427,380 Loss (gain) on disposal of property, plant and equipment, 6(31) net 559,393 ( 153,958 ) Loss (gain) on financial assets or liabilities at fair value 6(2) through profit or loss, net 311,994 ( 485,960 ) Share of profit of associates and joint ventures accounted for under equity method ( 4,838,075 ) ( 2,538,364 ) Gain on disposal of investment 6(31) ( 1,427,121 ) ( 1,644,484 ) Interest expense 6(34) 9,117,464 9,596,761 Interest income 6(30) ( 10,845,494 ) ( 13,348,559 ) Dividend income 6(30) ( 419,216 ) ( 289,536 ) Changes in assets/liabilities relating to operating activities Net changes in assets relating to operating activities Financial assets held for trading ( 1,411,995 ) ( 403,168 ) Notes receivable ( 582,757 ) 4,100 Accounts receivable ( 129,827,318 ) ( 147,213,729 ) Accounts receivable due from related parties 15,521,393 ( 10,177,840 ) Other receivables ( 1,707,015 ) ( 2,031,301 ) Inventories 37,097,551 21,696,797 Prepayments 1,253,288 ( 527,122 ) Net changes in liabilities relating to operating activities Accounts payable 80,186,615 83,030,692 Accounts payable to related parties ( 5,853,108 ) 6,845,670 Other payables 14,011,616 53,246,163 Provisions for liabilities - current ( 1,057,944 ) ( 3,838,604 ) Receipts in advance ( 10,539,496 ) 15,933,049 Other current liabilities ( 641,479 ) 403,067 Accrued pension liabilities ( 86,428 ) 213,735 Cash generated from operations 199,536,121 198,188,824 Income tax paid ( 26,784,550 ) ( 24,697,266 ) Net cash provided by operating activities 172,751,571 173,491,558
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104 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 HON HAI PRECISION INDUSTRY CO., LTD. CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2013 AND 2012 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)
Notes 2013 2012
CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of property, plant and equipment 6(37) ($ 44,395,165 ) ($ 80,466,662 ) (Increase) decrease in other financial assets ( 3,394,991 ) 43,731,078 Acquisition of available-for-sale financial assets ( 488,977 ) ( 7,740,334 ) Decrease (increase) in other non-current assets 830,897 ( 4,122,571 ) Acquisition of investments accounted for under equity method ( 1,408,714 ) ( 2,806,699 ) Acquisition of financial assets at cost ( 2,060,666 ) ( 6,093,326 ) Acquisition of intangible assets 6(12) ( 9,180,000 ) ( 3,448,500 ) Increase in land use right ( 563,668 ) ( 502,553 ) Proceeds from disposal of financial assets carried at cost 456,764 1,139,173 Proceeds from disposal of available-for-sale financial assets 1,401,164 7,971,912 Proceeds from disposal of investments accounted for under equity method 2,436,170 3,437,782 Proceeds from disposal of property, plant and equipment 9,106,480 6,093,536 Proceeds from disposal of land use right - 102,608 Other investing activities 1,327,042 ( 598,154 ) Interest received 10,475,314 12,661,964 Dividends received 1,552,262 1,267,852 Net cash used in investing activities ( 33,906,088 ) ( 29,372,894 ) CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term loans 54,232,791 37,049,416 Increase in short-term notes and bills payable 11,990,920 2,285 Proceeds from issuing bonds 28,242,000 45,176,000 Repayment of bonds ( 32,477,430 ) ( 3,000,000 ) Proceeds from long-term debt 17,761,410 6,214,600 Repayment of long-term debt ( 26,877,214 ) ( 6,653,250 ) Increase in other non-current liabilities 834,513 1,246,818 Cash dividends paid ( 17,753,800 ) ( 16,033,645 ) Changes in non-controlling interests 6(28) 3,930,733 1,914,158 Interest paid ( 8,188,197 ) ( 8,928,971 ) Net cash provided by financing activities 31,695,726 56,987,411 Net effect of changes in foreign currency exchange rates 17,958,880 ( 25,372,752 ) Increase in cash and cash equivalents 188,500,089 175,733,323 Cash and cash equivalents at beginning of year 505,526,956 329,793,633 Cash and cash equivalents at end of year $ 694,027,045 $ 505,526,956
The accompanying notes are an integral part of these consolidated financial statements. See report of independent accountants dated March 28, 2014.
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HON HAI PRECISION INDUSTRY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2013 AND 2012 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS, EXCEPT AS OTHERWISE INDICATED)
1. HISTORY AND ORGANIZATION Hon Hai Precision Industry Co., Ltd. (the “Company”) was incorporated as a company limited by shares under the provisions of the Company Act of the Republic of China (R.O.C.). The Company and its subsidiaries (collectively referred herein as the “Group”) are primarily engaged in the manufacture, sales and service of connectors, case, thermal module, wired/wireless communication products, optical products, power supply modules, and assemblies for use in the IT, communications, automotive equipment, precision molding, automobile, and consumer electronics industries. 2. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORIZATION These consolidated financial statements were authorized for issuance by the Board of Directors on March 28, 2014. 3. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS (1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”) Not applicable as it is the first-time adoption of IFRSs by the Group this year. (2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by the Group IFRS 9, ‘Financial Instruments: Classification and measurement of financial assets’ A.The International Accounting Standards Board (“IASB”) published IFRS 9, ‘Financial Instruments’, in November 2009, which will take effect on January 1, 2013 with early application permitted (Through the amendments to IFRS 9 published on November 19, 2013, the IASB has removed the previous mandatory effective date, but the standard is available for immediate application). Although the FSC has endorsed IFRS 9, FSC does not permit early application of IFRS 9 when IFRSs are adopted in R.O.C. in 2013. Instead, enterprises should apply International Accounting Standard No. 39 (“IAS 39”), ‘Financial Instruments: Recognition and Measurement’ reissued in 2009. B.IFRS 9 was issued as the first step to replace IAS 39. IFRS 9 outlines the new classification and measurement requirements for financial instruments, which might affect the accounting treatments for financial instruments of the Group. C.The Group has not evaluated the overall effect of the IFRS 9 adoption. However, based on preliminary evaluation, it was noted that the IFRS 9 adoption might have an impact on those instruments classified as ‘available-for-sale financial assets’ held by the Group, as IFRS 9
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specifies that the fair value changes in the equity instruments that meet certain criteria may be reported in other comprehensive income, and such amount that has been recognised in other comprehensive income should not be reclassified to profit or loss when such assets are derecognised. The Group recognized loss on debt instruments and on equity instruments amounting to $1,002,017 in other comprehensive income for the year ended December 31, 2013. (3) IFRSs issued by IASB but not yet endorsed by the FSC The following are the assessment of new standards, interpretations and amendments issued by IASB but not yet endorsed by the FSC (application of the new standards and amendments should follow the regulations of the FSC): Interpretations and IASB Effective Amendments Main Amendments Date Limited exemption from The amendment provides first-time adopters of July 1, 2010 comparative IFRS 7 IFRSs with the same transition relief that disclosures for first-time existing IFRS preparer received in IFRS 7, adopters (amendment to IFRS ‘Financial Instruments: Disclosures’ and 1) exempts first-time adopters from providing the additional comparative disclosures.
Improvements to IFRSs 2010 Amendments to IFRS 1, IFRS 3, IFRS 7, IAS January 1, 2011 1, IAS 34 and IFRIC 13.
IFRS 9, ‘Financial IFRS 9 requires gains and losses on financial November 19, 2013 instruments: Classification liabilities designated at fair value through (Not mandatory) and measurement of financial profit or loss to be split into the amount of liabilities’ change in the fair value that is attributable to changes in the credit risk of the liability, which shall be presented in other comprehensive income, and cannot be reclassified to profit or loss when derecognising the liabilities; and all other changes in fair value are recognised in profit or loss. The new guidance allows the recognition of the full amount of change in the fair value in the profit or loss only if there is reasonable evidence showing on initial recognition that the recognition of changes in the liability's credit risk in other comprehensive income would create or enlarge an accounting mismatch (inconsistency) in profit or loss. (That determination is made at initial recognition and is not reassessed subsequently.)
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Interpretations and IASB Effective Amendments Main Amendments Date
Disclosures - transfers of The amendment enhances qualitative and July 1, 2011 financial assets (amendment quantitative disclosures for all transferred to IFRS 7) financial assets that are not derecognised and for any continuing involvement in transferred assets, existing at the reporting date. Severe hyperinflation and When an entity’s date of transition to IFRSs is July 1, 2011 removal of fixed dates for on, or after, the functional currency first-time adopters normalisation date, the entity may elect to (amendment to IFRS 1) measure all assets and liabilities held before the functional currency normalisation date at fair value on the date of transition to IFRSs. First-time adopters are allowed to apply the derecognition requirements in IAS 39, ‘Financial instruments: Recognition and measurement’, prospectively from the date of transition to IFRSs, and they are allowed not to retrospectively recognise related gains on the date of transition to IFRSs. Deferred tax: recovery of The amendment gives a rebuttable presumption January 1, 2012 underlying assets (amendment that the carrying amount of investment to IAS 12) properties measured at fair value is recovered entirely by sale, unless there exists any evidence that could rebut this presumption. The amendment also replaces SIC 21, ‘Income taxes—recovery of revalued non-depreciable assets’. IFRS 10, ‘Consolidated The standard builds on existing principles by January 1, 2013 financial statements’ identifying the concept of control as the determining factor in whether an entity should be included within the consolidated financial statements of the parent company. The standard provides additional guidance to assist in the determination of control where it is difficult to assess. IFRS 11, ‘Joint arrangements’ Judgments applied when assessing the types of January 1, 2013 joint arrangements-joint operations and joint ventures, the entity should assess the contractual rights and obligations instead of the legal form only. The standard also prohibits the proportional consolidation for joint ventures.
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Interpretations and IASB Effective Amendments Main Amendments Date
IFRS 12, ‘Disclosure of The standard requires the disclosure of January 1, 2013 interests in other entities’ interests in other entities including subsidiaries, joint arrangements, associates and unconsolidated structured entities.
IAS 27, ‘Separate financial The standard removes the requirements of January 1, 2013 statements’ (as amended in consolidated financial statements from IAS 27 2011) and those requirements are addressed in IFRS 10, ‘Consolidated financial statements’.
IAS 28, ‘Investments in As consequential amendments resulting from January 1, 2013 associates and joint ventures’ the issuance of IFRS 11, ‘Joint arrangements’, (as amended in 2011) IAS 28 (revised) sets out the requirements for the application of the equity method when accounting for investments in joint ventures.
IFRS 13, ‘Fair value IFRS 13 aims to improve consistency and January 1, 2013 measurement’ reduce complexity by providing a precise definition of fair value and a single source of fair value measurement and disclosure requirements for use across IFRSs. The requirements do not extend the use of fair value accounting but provide guidance on how it should be applied where its use is already required or permitted by other standards within IFRSs. IAS 19 revised, ‘Employee The revised standard eliminates corridor January 1, 2013 benefits’ (as amended in approach and requires actuarial gains and 2011) losses to be recognised immediately in other comprehensive income. Past service costs will be recognised immediately in the period incurred. Net interest expense or income, calculated by applying the discount rate to the net defined benefit asset or liability, replace the finance charge and expected return on plan assets. The return of plan assets, excluding net interest expense, is recognised in other comprehensive income.
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Interpretations and IASB Effective Amendments Main Amendments Date
Presentation of items of other The amendment requires profit or loss and July 1, 2012 comprehensive income other comprehensive income (OCI) to be (amendment to IAS 1) presented separately in the statement of comprehensive income. Also, the amendment requires entities to separate items presented in OCI into two groups based on whether or not they may be recycled to profit or loss subsequently. IFRIC 20, ‘Stripping costs in Stripping costs that meet certain criteria should January 1, 2013 the production phase of a be recognised as the ‘stripping activity asset’. surface mine’ To the extent that the benefit from the stripping activity is realised in the form of inventory produced, the entity shall account for the costs of that stripping activity in accordance with IAS 2, ‘Inventories’.
Disclosures—Offsetting The amendment requires disclosures to include January 1, 2013 financial assets and financial quantitative information that will enable users liabilities (amendment to of an entity’s financial statements to evaluate IFRS 7) the effect or potential effect of netting arrangements.
Offsetting financial assets and The amendments clarify the requirements for January 1, 2014 financial liabilities offsetting financial instruments on the (amendment to IAS 32) statement of financial position: (i) the meaning of 'currently has a legally enforceable right to set off the recognised amounts'; and (ii) that some gross settlement mechanisms with certain features may be considered equivalent to net settlement.
Government loans The amendment provides exception to first- January 1, 2013 (amendment to IFRS 1) time adopters to apply the requirements in IFRS 9, ‘Financial instruments’, and IAS 20, ‘Accounting for government grants and disclosure of government assistance’, prospectively to government loans that exist at the date of transition to IFRSs; and first-time adopters should not recognise the corresponding benefit of the government loan at a below-market rate of interest as a government grant.
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Interpretations and IASB Effective Amendments Main Amendments Date
Improvements to IFRSs 2009- Amendments to IFRS 1 and IAS 1, IAS 16, January 1, 2013 2011 IAS 32 and IAS 34.
Consolidated financial The amendment clarifies that the date of initial January 1, 2013 statements, joint arrangements application is the first day of the annual period and disclosure of interests in in which IFRS 10, 11 and 12 is adopted. other Entities: Transition guidance (amendments to IFRS 10, IFRS 11 and IFRS 12)
Investment entities The amendments define ‘Investment Entities’ January 1, 2014 (amendments to IFRS 10, and their characteristics. The parent company IFRS 12 and IAS 27) that meets the definition of investment entities should measure its subsidiaries using fair value through profit or loss instead of consolidating them.
IFRIC 21, ‘Levies’ The interpretation addresses the accounting for January 1, 2014 levies imposed by governments in accordance with legislation (other than income tax). A liability to pay a levy shall be recognised in accordance with IAS 37, ‘Provisions, contingent liabilities and contingent assets’.
Recoverable amount The amendments remove the requirement to January 1, 2014 disclosures for non-financial disclose recoverable amount when a cash assets (amendments to IAS generating unit (CGU) contains goodwill or 36) intangible assets with indefinite useful lives that were not impaired.
Novation of derivatives and The amendment states that the novation of a January 1, 2014 continuation of hedge hedging instrument would not be considered an accounting (amendments to expiration or termination giving rise to the IAS 39) discontinuation of hedge accounting when the hedging instrument that is being novated complies with specified criteria.
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Interpretations and IASB Effective Amendments Main Amendments Date
IFRS 9, "Financial assets: 1. IFRS 9 relaxes the requirements for hedged November 19, 2013 hedge accounting" and items and hedging instruments and removes (Not mandatory) admendments to IFRS 9, the bright line of effectiveness to better align IFRS 7 and IAS 39 hedge accounting with the risk management activities of an entity. 2. An entity can elect to early adopt the requirement to recognise the changes in fair value attributable to changes in an entity's own credit risk from financial liabilities that are designated under the fair value option in ‘ other comprehensive income’. Services related contributions The amendment allows contributions from July 1, 2014 from employees or third employees or third parties that are linked to parties (amendments to IAS service, and do not vary with the length of 19R) employee service, to be deducted from the cost of benefits earned in the period that the service is provided. Contributions that are linked to service, and vary according to the length of employee service, must be spread over the service period using the same attribution method that is applied to the benefits. Improvements to IFRSs 2010- Amendments to IFRS 2, IFRS 3, IFRS 8, IFRS July 1, 2014 2012 13, IAS 16, IAS 24 and IAS 38. Improvements to IFRSs 2011- Amendments to IFRS 1, IFRS 3, IFRS 13 and July 1, 2014 2013 IAS 40. The Group is assessing the potential impact of the new standards, interpretations and amendments above and has not yet been able to reliably estimate their impact on the consolidated financial statements. 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Unless otherwise stated, the principal accounting policies applied in the preparation of these consolidated financial statements set out below have been consistently applied to all the periods presented. (4) Compliance statement A. These consolidated financial statements are the first consolidated financial statements prepared by the Group in accordance with the “Rules Governing the Preparation of Financial Statements by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC (collectively referred herein as the “IFRSs”). B. In the preparation of the balance sheet as of January 1, 2012 (the Group’s date of transition to IFRSs) (“the opening IFRS balance sheet”), the Group has adjusted the amounts that were
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reported in the consolidated financial statements in accordance with previous R.O.C. GAAP. Please refer to Note 15 for the impact of transitioning from R.O.C. GAAP to IFRSs, on the Group’s financial position, financial performance and cash flows. (5) Basis of preparation A. Except for the following items, these consolidated financial statements have been prepared under the historical cost convention: (a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss. (b) Available-for-sale financial assets measured at fair value. (c) Liabilities on cash-settled share-based payment arrangements measured at fair value. (d) Defined benefit liabilities recognized based on the net amount of pension fund assets plus unrecognized past period’s service cost and unrecognized actuarial losses, less present value of defined benefit obligation. B. The preparation of financial statements in compliance with IFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5. (6) Basis of consolidation A. Basis for preparation of consolidated financial statements: (a) All subsidiaries are included in the Group’s consolidated financial statements. Subsidiaries are all entities (including special purpose entities) over which the Group has the power to govern the financial and operating policies. In general, control is presumed to exist when the parent owns, directly or indirectly through subsidiaries, more than half of the voting power of an entity. The existence and effect of potential voting rights that are currently exercisable or convertible have been considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. (b) Inter-company transactions, balances and unrealized gains or losses on transactions between companies within the Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Group. (c) Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non-controlling interests. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance. (d) Changes in a parent’s ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary (transactions with non-controlling interests) are accounted for as equity transactions, i.e. transactions with owners in their capacity as owners. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity. (e) When the Group loses control of a subsidiary, the Group remeasures any investment retained in the former subsidiary at its fair value. Any difference between fair value and carrying
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amount is recognized in profit or loss. All amounts previously recognized in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss. B. Subsidiaries included in the consolidated financial statements: Ownership (%) Investor Subsidiary Main Business Activities 2013.12.31 2012.12.31 2012.1.1 Note Hon Hai Foxconn Investment holdings in 100 100 100 (a)(b) Precision (Far East) companies in Mainland (c)(d) Industry Limited and China, Hong Kong, Europe Co., Ltd. subsidiaries and America primarily engaged in manufacturing, sale, research and development of computer cases, connectors and computer components " Foxconn Investment holdings in hi-tech 100 100 100 Holding companies in Asia-Pacific Ltd. and and America subsidiaries " Hyield Venture capital investments in 98 98 98 Venture companies primarily engaged Capital Co., in manufacturing of automobile Ltd. and wires/electronic devices and subsidiaries electronic components, and services of planning, and business management " Bao Shin Domestic investments in 100 100 100 International companies primarily engaged Investment in development and sale of Co., Ltd. computer systems, and manufacturing and sale of subsidiaries machinery and equipment " Hon Yuan Domestic investments in 100 100 100 International companies primarily engaged Investment in manufacturing and sale of Co., Ltd. machinery and equipment and subsidiaries " Hon Chi Domestic investments in 100 100 100 International companies primarily engaged Investment in software and electronic Co., Ltd. information application services, and and manufacturing and sale subsidiaries machinery and equipment
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Ownership (%) Investor Subsidiary Main Business Activities 2013.12.31 2012.12.31 2012.1.1 Note
Hon Hai Lin Yih Investment holdings in R.O.C. 100 100 100 Precision International companies Industry Investment Co., Ltd. Co., Ltd. " Hon Hai/ Logistics services in America 100 100 100 Foxconn Logistics California LLC. " Hon Hai/ Logistics services in America 100 100 100 Foxconn Logistics Texas LLC. " Ambit Investment holdings in 100 100 100 International companies in Mainland Ltd. and primarily engaged in subsidiaries manufacturing and sale of power supply modules, application modules and network cables assemblies " Foxconn Asia-Pacific sales company 100 100 100 Singapore (Pte) Ltd. and subsidiaries " Foxconn Patent applications in America 100 100 100 International Inc. " Altus Manufacture and design of 100 100 100 Technology cellular phone and camera Inc. and packaging of sensors " Premier Manufacture and sale of 99.96 99.96 99.96 Technology camera -Hong Kong Limited and subsidiaries " Foxconn SA Investment holdings in 97.76 97.76 97.76 B.V. and Russian domestic sales subsidiaries companies
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Ownership (%) Investor Subsidiary Main Business Activities 2013.12.31 2012.12.31 2012.1.1 Note
Hon Hai Margini Investment holdings in 100 100 100 Precision Holdings Vietnam export processing and Industry Limited and construction services Co., Ltd. subsidiaries companies and Brazil domestic sales companies " Foxconn Investment holdings in 100 100 100 Holdings companies in Europe B.V. - Netherland and subsidiaries " Syntrend Retail of office machinery and 73.47 80 80 Creative equipment and electronic Co., Ltd. appliances, and information/ software services " Ambit Mobile communications 100 100 100 Microsystems Corporation Changes in the consolidated subsidiaries: (a) From July, 2011 to March, 2012, a subsidiary of the Company disposed 70% of Shenzhen Futaihong Bright Real Estate Co., which was excluded from consolidation effective in March, 2012, the date on which the Company lost control over the subsidiary (b) In the first half of 2012, a subsidiary of the Company acquired 95.18% and 68% ownership in Interface Optoelectronics (Shenzhen) Co., Ltd. and Interface Technology (Chengdu) Co., Ltd., respectively, which were consolidated effective the acquisition date. However, the subsidiary made adjustments to its investments in the two investees subsequently in the fourth quarter of 2012 for business consideration, which resulted to a loss of control over them. Thus, the two investees were excluded from consolidation effective the date on which the subsidiary lost control over them. (c) In the first half of 2012, a subsidiary of the Company acquired 50.48% ownership in Synergy Technology (Chengdu) Co., Ltd., which was consolidated effective the acquisition date. (d) In December, 2012, a subsidiary of the Company acquired 100% ownership in Excel Victory Ltd. and its subsidiaries, which were consolidated effective the acquisition date. C. Subsidiaries not included in the consolidated financial statements: None. D. Adjustments for subsidiaries with different balance sheet dates: None. E. Nature and extent of the restrictions on fund remittance from subsidiaries to the parent company: None. (7) Foreign currency translation A. The consolidated financial statements are presented in NTD, which is the Company’s functional
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and the Group’s presentation currency. B. Foreign currency transactions and balances (a) Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions are recognized in profit or loss in the period in which they arise. (b) Monetary assets and liabilities denominated in foreign currencies at the period end are re- translated at the exchange rates prevailing at the balance sheet date. Exchange differences arising upon re-translation at the balance sheet date are recognized in profit or loss. (c) Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in other comprehensive income. However, non- monetary assets and liabilities denominated in foreign currencies that are not measured at fair value are translated using the historical exchange rates at the dates of the initial transactions. (d) All foreign exchange gains and losses are presented in the statement of comprehensive income within other ‘gains and losses’. C. Translation of foreign operations (a) The operating results and financial position of all the group entities and associates that have a functional currency different from the presentation currency are translated into the presentation currency as follows: i. Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet; ii. Income and expenses for each statement of comprehensive income are translated at average exchange rates of that period; and iii. All resulting exchange differences are recognized in other comprehensive income. (b) When the foreign operation as an associate is partially disposed of or sold, exchange differences that were recorded in other comprehensive income are proportionately reclassified to profit or loss as part of the gain or loss on sale. In addition, when the Group still retains partial interest in the former foreign associate after losing significant influence over the former foreign associate, such transactions should be accounted for as disposal of all interest in these foreign operations. (c) When the foreign operation partially disposed of or sold is a subsidiary, cumulative exchange differences that were recorded in other comprehensive income are proportionately transferred to the non-controlling interest in this foreign operation. In addition, if the Group
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still retains partial interest in the former foreign subsidiary after losing control of the former foreign subsidiary, such transactions should be accounted for as disposal of all interest in the foreign operation. (8) Classification of current and non-current items A. Assets that meet one of the following criteria are classified as current assets; otherwise they are classified as non-current assets: (a) Assets arising from operating activities that are expected to be realized, or are intended to be sold or consumed within the normal operating cycle; (b) Assets held mainly for trading purposes; (c) Assets that are expected to be realized within twelve months from the balance sheet date; (d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date. B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities: (a) Liabilities that are expected to be paid off within the normal operating cycle; (b) Liabilities arising mainly from trading activities; (c) Liabilities that are to be paid off within twelve months from the balance sheet date; (d) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification. (9) Cash equivalents Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Time deposits that meet the above criteria and are held for the purpose of meeting short-term cash commitment in operations are classified as cash equivalents. (10) Financial assets at fair value through profit or loss A. Financial assets at fair value through profit or loss are financial assets held for trading or financial assets designated as at fair value through profit or loss on initial recognition. Financial assets are classified in this category of held for trading if acquired principally for the purpose of selling in the short-term. Derivatives are also categorized as financial assets held for trading unless they are designated as hedges. Financial assets that meet one of the following criteria are designated as at fair value through profit or loss on initial recognition: (a) Hybrid (combined) contracts; or (b) They eliminate or significantly reduce a measurement or recognition inconsistency; or (c) They are managed and their performance is evaluated on a fair value basis, in accordance with a documented risk management or investment strategy.
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B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognized and derecognized using trade date accounting. C. Financial assets at fair value through profit or loss are initially recognized at fair value. Related transaction costs are expensed in profit or loss. These financial assets are subsequently remeasured and stated at fair value, and any changes in the fair value of these financial assets are recognized in profit or loss. (11) Available-for-sale financial assets A. Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. B. On a regular way purchase or sale basis, available-for-sale financial assets are recognized and derecognized using trade date accounting. C. Available-for-sale financial assets are initially recognized at fair value plus transaction costs. These financial assets are subsequently remeasured and stated at fair value, and any changes in the fair value of these financial assets are recognized in other comprehensive income. Investments in equity instruments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured or derivatives that are linked to and must be settled by delivery of such unquoted equity instruments are presented in ‘financial assets measured at cost’. (12) Accounts receivable Accounts receivable are created by the entity by selling goods or providing services to customers in the ordinary course of business. Accounts receivable are initially recognized at fair value and subsequently measured at amortized cost using the effective interest method, less provision for impairment. However, short-term accounts receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial. (13) Impairment of financial assets A. The Group assesses at balance sheet date whether there is objective evidence that an individual financial asset or a group of financial assets is impaired as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the individual financial asset or group of financial assets that can be reliably estimated. B. The criteria that the Group uses to determine whether there is an impairment loss is as follows: (a) Significant financial difficulty of the issuer or debtor; (b) A breach of contract, such as a default or delinquency in interest or principal payments; (c) The Group, for economic or legal reasons relating to the borrower’s financial difficulty, granted the borrower a concession that a lender would not otherwise consider; (d) It becomes probable that the borrower will enter bankruptcy or other financial reorganisation; (e) The disappearance of an active market for that financial asset because of financial
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difficulties; (f) Observable data indicating that there is a measurable decrease in the estimated future cash flows from a group of financial assets since the initial recognition of those assets, although the decrease cannot yet be identified with the individual financial asset in the group, including adverse changes in the payment status of borrowers in the group or national or local economic conditions that correlate with defaults on the assets in the group; (g) Information about significant changes with an adverse effect that have taken place in the technology, market, economic or legal environment in which the issuer operates, and indicates that the cost of the investment in the equity instrument may not be recovered; or (h) A significant or prolonged decline in the fair value of an investment in an equity instrument below its cost. C. When the Group assesses that there has been objective evidence of impairment and an impairment loss has occurred, accounting for impairment is made as follows according to the category of financial assets: (a) Financial assets measured at cost The amount of the impairment loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at current market return rate of similar financial asset, and is recognized in profit or loss. Impairment loss recognized for this category shall not be reversed subsequently. Impairment loss is recognized by adjusting the carrying amount of the asset directly. (b) Available-for-sale financial assets The amount of the impairment loss is measured as the difference between the asset’s acquisition cost (less any principal repayment and amortisation) and current fair value, less any impairment loss on that financial asset previously recognized in profit or loss, and is reclassified from ‘other comprehensive income’ to ‘profit or loss’. If, in a subsequent period, the fair value of an investment in a debt instrument increases, and the increase can be related objectively to an event occurring after the impairment loss was recognized, then such impairment loss is reversed through profit or loss. Impairment loss of an investment in an equity instrument recognized in profit or loss shall not be reversed through profit or loss. Impairment loss is recognized and reversed by adjusting the carrying amount of the asset directly. (14) Derecognition of financial assets The Group derecognizes a financial asset when the contractual rights to receive the cash flows from the financial asset expire. A. The contractual rights to receive the cash flows from the financial asset expire. B. The contractual rights to receive cash flows from the financial asset have been transferred and the Group has transferred substantially all risks and rewards of ownership of the financial asset. C. The contractual rights to receive cash flows from the financial asset have been transferred;
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however, the Group has not retained control of the financial asset. (15) Inventories Inventories are stated at the lower of cost and net realisable value. Cost is determined using the weighted-average cost method. The cost of finished goods and work in progress comprises raw materials, direct labour, other direct costs and related production overheads (allocated based on normal operating capacity). It excludes borrowing costs. The item by item approach is used in applying the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses. (16) Investments accounted for under equity method / associates A. Associates are all entities over which the Group has significant influence but not control. In general, it is presumed that the investor has significant influence, if an investor holds, directly or indirectly 20 percent or more of the voting power of the investee. Investments in associates are accounted for under the equity method and are initially recognized at cost. B. The Group’s share of its associates’ post-acquisition profits or losses is recognized in profit or loss, and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognize further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate. C. When changes in an associate’s equity are not recognized in profit or loss or other comprehensive income of the associate and such changes do not affect the Group’s ownership percentage of the associate, the Group recognizes change in ownership interests in the associate in ‘capital surplus’ in proportion to its ownership. D. Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associates. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been adjusted where necessary to ensure consistency with the policies adopted by the Group. E. In the case that an associate issues new shares and the Group does not subscribe or acquire new shares proportionately, which results in a change in the Group’s ownership percentage of the associate but maintains significant influence on the associate, then ‘capital surplus’ and ‘investments accounted for under the equity method’ shall be adjusted for the increase or decrease of its share of equity interest. If the above condition causes a decrease in the Group’s ownership percentage of the associate, in addition to the above adjustment, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss proportionately on the same basis as would be required if the relevant assets or liabilities were disposed of.
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F. Upon loss of significant influence over an associate, the Group remeasures any investment retained in the former associate at its fair value. Any difference between fair value and carrying amount is recognized in profit or loss. G. When the Group disposes its investment in an associate and loses significant influence over this associate, the amounts previously recognized in other comprehensive income in relation to the associate, are reclassified to profit or loss, on the same basis as would be required if the relevant assets or liabilities were disposed of. If it retains significant influence over this associate, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss proportionately in accordance with the aforementioned approach. H. When the Group disposes its investment in an associate and loses significant influence over this associate, the amounts previously recognized as capital surplus in relation to the associate are transferred to profit or loss. If it retains significant influence over this associate, then the amounts previously recognized as capital surplus in relation to the associate are transferred to profit or loss proportionately. (17) Property, plant and equipment A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalized. B. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred. C. Land is not depreciated. Other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. If each component of property, plant and equipment is significant in relation to the total cost of the item, it must be depreciated separately. D. The assets’ residual values, useful lives and depreciation methods are audited, and adjusted if appropriate, at each balance sheet date. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change.
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The estimated useful lives of property, plant and equipment are as follows: Buildings 51 years (Auxiliary buildings 6 ~ 11 years) Machinery and equipment 3 ～ 9 years Office equipment 4 ～ 6 years Other equipment e 1 ～ 6 years (18) Investment property An investment property is stated initially at its cost and measured subsequently using the cost model. Investment property is depreciated on a straight-line basis over its estimated useful life of 6 ~ 51 years. (19) Intangible assets A. Goodwill arises in a business combination, which is accounted for by applying the acquisition method. B. Patent is amortised on a straight-line basis over its estimated useful life of 1 ~ 20 years. C. Concession license is amortised using the straight-line method starting from the date the license was granted by the National Communications Commission until expiration. (20) Impairment of non-financial assets A. The Group assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. Except for goodwill, when the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortised historical cost would have been if the impairment had not been recognised. B. Goodwill for impairment testing purpose is allocated to cash generating units. This allocation is identified based on operating segments. Goodwill is allocated to a cash generating unit or a group of cash generating units that expects to benefit from the business combinations. (21) Borrowings Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognized in profit or loss over the period of the borrowings using the effective interest method. (22) Notes and accounts payable Notes and accounts payable are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. They are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method. However, short-term accounts payable without bearing interest are subsequently measured at initial invoice amount as
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the effect of discounting is immaterial. (23) Financial liabilities at fair value through profit or loss A. Financial liabilities at fair value through profit or loss are financial liabilities held for trading or financial liabilities designated as at fair value through profit or loss on initial recognition. Financial liabilities are classified in this category of held for trading if acquired principally for the purpose of repurchasing in the short-term. Derivatives are also categorized as financial liabilities held for trading unless they are designated as hedges. Financial liabilities that meet one of the following criteria are designated as at fair value through profit or loss on initial recognition: (a) Hybrid (combined) contracts; or (b) They eliminate or significantly reduce a measurement or recognition inconsistency; or (c) They are managed and their performance is evaluated on a fair value basis, in accordance with a documented risk management policy. B. Financial liabilities at fair value through profit or loss are initially recognised at fair value. Related transaction costs are expensed in profit or loss. These financial liabilities are subsequently remeasured and stated at fair value, and any changes in the fair value of these financial liabilities are recognised in profit or loss. (24) Derecognition of financial liabilities A financial liability is derecognized when the obligation under the liability specified in the contract is discharged or cancelled or expires. (25) Offsetting financial instruments Financial assets and liabilities are offset and reported in the net amount in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. (26) Financial liabilities and equity instruments - Bonds payable A. Ordinary corporate bonds issued by the Group are initially recognized at fair value, net of transaction costs incurred. Ordinary corporate bonds are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is accounted for as the premium or discount on bonds payable and presented as an addition to or deduction from bonds payable, which is amortised in profit or loss as an adjustment to the ‘finance costs’ over the period of bond circulation using the effective interest method. B. Convertible corporate bonds issued by the Group contain conversion options (that is, the bondholders have the right to convert the bonds into the Group’s common shares but not by exchanging a fixed amount of cash for a fixed number of common shares), call options and put options. The Group classifies the bonds payable and derivative features embedded in convertible corporate bonds on initial recognition as a financial asset or a financial liability in accordance with the substance of the contractual arrangement. Convertible corporate bonds are accounted for as follows:
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(a) Conversion options, call options and put options embedded in convertible corporate bonds are recognized initially at net fair value as ‘financial assets or financial liabilities at fair value through profit or loss’. They are subsequently remeasured and stated at fair value on each balance sheet date; the gain or loss is recognized as ‘gain or loss on valuation of financial assets or financial liabilities at fair value through profit or loss’. (b) Bonds payable of convertible corporate bonds is the remaining value of total issue price less amounts of ‘financial assets or financial liabilities at fair value through profit or loss’ as stated above, and subsequently stated at amortised cost. Any difference between the proceeds and the redemption value is accounted for as the premium or discount on bonds payable and presented as an addition to or deduction from bonds payable, which is amortised in profit or loss as an adjustment to the ‘finance costs’ over the period of bond circulation using the effective interest method. (c) Any transaction costs directly attributable to the issuance of convertible corporate bonds are allocated to each liability components in proportion to the allocation of proceeds. (d) When bondholders exercise conversion options, the liability component of the bonds (including ‘bonds payable’ and ‘financial assets or financial liabilities at fair value through profit or loss’) shall be remeasured on the conversion date. The book value of common shares issued due to the conversion shall be based on the adjusted book value of the above mentioned liability component. (27) Derivative financial instruments Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are subsequently remeasured at their fair value. Any changes in the fair value are recognized in profit or loss. (28) Provisions Provisions of warranties are recognized when the Group has a present legal or constructive obligation as a result of past events, and it is probable that an outflow of economic resources will be required to settle the obligation and the amount of the obligation can be reliably estimated. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation on the balance sheet date, which is discounted using a pre-tax discount rate that reflects the current market assessments of the time value of money and the risks specific to the obligation. When discounting is used, the increase in the provision due to passage of time is recognized as interest expense. Provisions are not recognized for future operating losses. (29) Employee benefits A. Short-term employee benefits Short -term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period and should be recognized as expenses in that period when the employees render service.
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B. Pensions (a) Defined contribution plans For defined contribution plans, the contributions are recognized as pension expenses when they are due on an accrual basis. Prepaid contributions are recognized as an asset to the extent of a cash refund or a reduction in the future payments. (b) Defined benefit plans i. Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Group in current period or prior periods. The liability recognised in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets, together with adjustments for unrecognised past service costs. The defined benefit net obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating to the terms of the related pension liability; when there is no deep market in high-quality corporate bonds, the Group uses interest rates of government bonds (at the balance sheet date) instead. ii. Actuarial gains and losses arising on defined benefit plans are recognized in other comprehensive income in the period in which they arise. iii. Past service costs are recognized immediately in profit or loss if vested immediately; if not, the past service costs are amortized on a straight-line basis over the vesting period. C. Employees’ bonus and directors’ and supervisors’ remuneration Employees’ bonus and directors’ and supervisors’ remuneration are recognized as expenses and liabilities, provided that such recognition is required under legal obligation or constructive obligation and those amounts can be reliably estimated. However, if the accrued amounts for employees’ bonus and directors’ and supervisors’ remuneration are different from the actual distributed amounts as resolved by the stockholders at their stockholders’ meeting subsequently, the differences should be recognized based on the accounting for changes in estimates. The Group calculates the number of shares of employees’ stock bonus based on the fair value per share at the previous day of the stockholders’ meeting held in the year following the financial reporting year, after taking into account the effects of ex-rights and ex-dividends. (30) Employee share-based payment A. For the equity-settled share-based payment arrangements, the employee services received are measured at the fair value of the equity instruments granted at the grant date, and are recognized as compensation cost over the vesting period, with a corresponding adjustment to equity. The fair value of the equity instruments granted shall reflect the impact of market vesting conditions and non-market vesting conditions. Compensation cost is subject to
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adjustment based on the service conditions that are expected to be satisfied and the estimates of the number of equity instruments that are expected to vest under the non-market vesting conditions at each balance sheet date. Ultimately, the amount of compensation cost recognized is based on the number of equity instruments that eventually vest. B. For the cash-settled share-based payment arrangements, the employee services received and the liability incurred are measured at the fair value of the liability to pay for those services, and are recognized as compensation cost and liability over the vesting period. The fair value of the liability shall be remeasured at each balance sheet date until settled, with any changes in fair value recognized in profit or loss. (31) Income tax A. The tax expense for the period comprises current and deferred tax. Tax is recognized in profit or loss, except to the extent that it relates to items recognized in other comprehensive income or items recognized directly in equity, in which cases the tax is recognized in other comprehensive income or equity. B. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. An additional 10% tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the year the stockholders resolve to retain the earnings. C. Deferred income tax is recognized, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated balance sheet. However, the deferred income tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled. D. Deferred income tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. At each balance sheet date, unrecognized and recognized deferred income tax assets are reassessed. E. Current income tax assets and liabilities are offset and the net amount is reported in the balance
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sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. Deferred income tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets against current tax liabilities and they are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realise the asset and settle the liability simultaneously. F. A deferred tax asset shall be recognised for the carryforward of unused tax credits resulting from acquisitions of equipment or technology, research and development expenditures, employees’ training costs and equity investments to the extent that it is possible that future taxable profit will be available against which the unused tax credits can be utilised. (32) Dividends Dividends are recorded in the Company’s financial statements in the period in which they are approved by the Company’s shareholders. Cash dividends are recorded as liabilities; stock dividends are recorded as stock dividends to be distributed and are reclassified to ordinary shares on the effective date of new shares issuance. (33) Revenue recognition The Group manufactures and sells 3C products. Revenue is measured at the fair value of the consideration received or receivable taking into account value-added tax, returns, rebates and discounts for the sale of goods to external customers in the ordinary course of the Group’s activities. Revenue arising from the sales of goods should be recognized when the Group has delivered the goods to the customer, the amount of sales revenue can be measured reliably and it is probable that the future economic benefits associated with the transaction will flow to the entity. The delivery of goods is completed when the significant risks and rewards of ownership have been transferred to the customer, the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold, and the customer has accepted the goods based on the sales contract or there is objective evidence showing that all acceptance provisions have been satisfied. (34) Government grants Government grants are recognized in profit or loss on a systematic basis over the periods in which the Group recognizes expenses for the related costs for which the grants are intended to compensate. Government grants related to property, plant and equipment are recognized as non- current liabilities and are amortised to profit or loss over the estimated useful lives of the related assets using the straight-line method. (35) Operating segments Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments.
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5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTION UNCERTAINTY The preparation of these consolidated financial statements requires management to make critical judgements in applying the Group’s accounting policies and make critical assumptions and estimates concerning future events. Assumptions and estimates may differ from the actual results and are continually evaluated and adjusted based on historical experience and other factors. The above information is addressed below: (36) Critical judgements in applying the Group’s accounting policies A. Revenue recognition The determination of whether the Group is acting as principal or agent in a transaction is based on an evaluation of Group’s exposure to the significant risks and rewards associated with the sale of goods or the rendering of service in accordance with the business model and substance of the transaction.When exposed to the significant risks and rewards, the Group acts as a principal, and the amount received or receivable from customer is recognised as revenue on a gross basis. Where the Group acts as an agent, net revenue is recognised representing earned. The Group provides integrated electronics manufacturing services to meet the following criteria by judgment, and recognises revenue on a gross basis: a. The Group has primary responsibilities for the goods or services it provides; b. The Group bears inventory risk; c. The Group bears credit risk of customers. B. Financial assets-impairment of equity investments The Group follows the guidance of IAS 39 to determine whether a financial asset—equity investment is impaired. This determination requires significant judgement. In making this judgement, the Group evaluates, among other factors, the duration and extent to which the fair value of an equity investment is less than its cost and the financial health of and short-term business outlook for the investee, including factors such as industry and sector performance, changes in technology and operational and financing cash flow. C. Financial assets measured at cost The Group can not obtain sufficient information for its unquoted equity investments to determine the fair value, so their fair values cannot be reliably measured. Therefore, the investments are classified as "financial assets carried at cost." (37) Critical accounting estimates and assumptions The Group makes estimates and assumptions based on the expectation of future events that are believed to be reasonable under the circumstances at the end of the reporting period. The resulting accounting estimates might be different from the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below:
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Evaluation of inventories As inventories are stated at the lower of cost and net realisable value, the Group must determine the net realisable value of inventories on balance sheet date using judgements and estimates. Due to the rapid technology innovation, the Group evaluates the amounts of normal inventory consumption, obsolete inventories or inventories without market selling value on balance sheet date, and writes down the cost of inventories to the net realisable value. Such an evaluation of inventories is principally based on the demand for the products within the specified period in the future. Therefore, there might be material changes to the evaluation. As of December 31, 2013, the carrying amount of inventories was $312,785,092. 6. DETAILS OF SIGNIFICANT ACCOUNTS (38) Cash and cash equivalents December 31, 2013 December 31, 2012 January 1, 2012 Cash on hand and revolving $ 3,338,615 $ 6,157,872 $ 4,201,508 funds Checking accounts and demand 120,750,443 136,700,562 109,934,189 deposits Cash equivalents Time deposits 567,070,489 353,871,385 206,682,107 Sweep fund 2,867,498 8,797,137 8,975,829 Total $ 694,027,045 $ 505,526,956 $ 329,793,633 A. The Group associates with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote. The Group’s maximum exposure to credit risk at balance sheet date is the carrying amount of all cash and cash equivalents. B. The Group’s time deposits pledged to others as collateral had been transferred to “other current assets”. Please refer to Note 8 for details. (39) Financial assets and liabilities at fair value through profit or loss Assets December 31, 2013 December 31, 2012 January 1, 2012 Current items: Open-end funds$ 430,040 $ 83,265 $ 24,412 Cross currency swap contracts 316,099 - - Forward exchange contracts 451,973 56,955 45,917 $ 1,198,112 $ 140,220 $ 70,329 Non-current item: $ - $ 179,300 $ - Convertible bonds payable
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Liabilities December 31, 2013 December 31, 2012 January 1, 2012 Current items: Forward exchange contracts($ 39,946) ($ 66,767) ($ 251,834) Euro-Convertible Bond conversion rights - ( 15,288) - ($ 39,946) ($ 82,055) ($ 251,834) Non-current item: Euro-Convertible Bond conversion rights $ - $ - ($ 470,158) A. Due to the financial assets and liabilities recognized above for the years ended December 31, 2013 and 2012, the Group recognized net loss of $311,994 and profit of $485,960, respectively. B. The counterparties of the Group’s debt derivative instruments have good credit quality, all with investment credit rating or above. The maximum exposure to credit risk at balance sheet date is the carrying amount of financial assets at fair value through profit or loss. C. The non-hedging derivative instruments transaction and contract information are as follows: December 31, 2013 Contract amount Derivative Financial Assets (Nominal Principal in thousands) Contract period Current items: Cross currency swap contracts TWD(BUY) 26,580,800 2013.11.26~2014.03.31 USD(SELL) 898,000 2013.11.26~2014.03.31 Foreign exchange forward MXN(BUY) 210,632 2013.10.10~2014.05.02 contracts KRW(BUY) 1,170,070 2013.11.21~2014.02.20 USD(BUY) 232,459 2013.10.24~2014.03.06 RMB(BUY) 8,841,823 2013.09.10~2014.03.24 JPY(BUY) 10,000 2013.11.28~2014.01.16 USD(SELL) 1,461,100 2013.09.10~2014.05.02 EUR(SELL) 32,300 2013.10.24~2014.03.06 BRL(SELL) 110,108 2013.11.18~2014.02.13 RMB(SELL) 853,232 2013.11.06~2014.03.05
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December 31, 2013 Contract amount Derivative Financial Liabilities (Nominal Principal in thousands) Contract period Current items: Foreign exchange forward BRL(BUY) 18,335 2013.11.21~2014.01.09 contracts KRW(BUY) 3,911,640 2013.12.19~2014.03.13 MXN(BUY) 811,904 2013.10.22~2014.04.10 RMB(BUY) 304,260 2013.12.18~2014.01.22 USD(BUY) 40,152 2013.10.14~2014.03.27 JPY(BUY) 109,778 2013.11.21~2014.04.25 USD(SELL) 124,272 2013.10.22~2014.04.10 EUR(SELL) 24,700 2013.10.14~2014.03.27 BRL(SELL) 5,366 2013.11.21~2014.01.23 INR(SELL) 326,989 2013.10.14~2014.04.25 December 31, 2012 Contract amount Derivative Financial Assets (Nominal Principal in thousands) Contract period Current items: Foreign exchange forward KRW (BUY) 1,949,780 2012.11.29~2013.05.23 contracts RMB (BUY) 1,582,660 2012.11.05~2013.08.15 MXN (BUY) 143,772 2012.10.11~2013.03.07 USD (BUY) 75,061 2012.10.22~2013.03.22 EUR (BUY) 68 2012.12.03~2013.01.04 RMB (SELL) 437,972 2012.11.19~2013.03.20 INR (SELL) 276,824 2012.10.22~2013.03.22 USD (SELL) 262,800 2012.10.11~2013.08.15 December 31, 2012 Contract amount Derivative Financial Liabilities (Nominal Principal in thousands) Contract period Current items: Foreign exchange forward MXN (BUY) 714,991 2012.10.09~2013.03.21 contracts USD (BUY) 153,903 2012.10.08~2013.03.21 JPY (BUY) 7,388 2012.11.16~2013.02.21 RMB (SELL) 879,519 2012.10.22~2013.03.14 USD (SELL) 55,950 2012.10.09~2013.03.21 BRL (SELL) 10,872 2012.10.25~2013.02.28 EUR (SELL) 6,600 2012.10.08~2013.03.21 INR (SELL) 1,295 2012.12.03~2013.01.18
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January 1, 2012 Contract amount Derivative Financial Assets (Nominal Principal in thousands) Contract period Current items: Foreign exchange forward HUF (BUY) 1,107,070 2011.11.17~2012.02.16 contracts JPY (BUY) 245,283 2011.12.09~2012.01.13 MXN (BUY) 28,090 2011.11.29~2012.01.12 RMB (BUY) 815,616 2011.11.14~2012.01.20 USD (BUY) 12,249 2011.10.12~2012.02.24 EUR (SELL) 16,500 2012.01.18~2012.02.16 INR (SELL) 290,008 2011.10.12~2012.02.24 USD (SELL) 123,096 2011.11.29~2012.01.13 January 1, 2012 Contract amount Derivative Financial Liabilities (Nominal Principal in thousands) Contract period Current items: Foreign exchange forward BRL (BUY) 15,078 2011.11.07~2012.03.07 contracts CHF (BUY) 2,220 2011.12.22~2012.02.15 EUR (BUY) 4,137 2011.12.09~2012.02.15 HUF (BUY) 2,631,660 2011.11.09~2012.02.23 MXN (BUY) 688,646 2011.10.21~2012.03.22 USD (BUY) 634,437 2011.09.29~2012.09.28 EUR (SELL) 8,500 2011.11.09~2012.02.23 INR (SELL) 39,050 2011.12.09~2012.02.03 RMB (SELL) 4,035,869 2011.09.29~2012.09.28 USD (SELL) 65,700 2011.10.21~2012.03.22 (a) Cross currency swap contracts The cross currency swap contracts signed by the Company are to fulfill capital movement. For exchange rate, principals denominated in two currencies are exchanged at the same exchange rate at the initial and final exchanges, thus, there is no foreign exchange risk. For interest rate, the fixed rate between two currencies is used to exchange, thus, there is no market interest rates. (b) Forward foreign exchange contracts The group enters into foreign exchange forward transactions to hedge the following risk of exchange rate: A. Operating activities: Import of raw materials and export sales. B. Investing activities: Import of machinery and equipment. C. Financing activities: Long-term and short-term foreign currency assets and liabilities.
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(c) Equity subscription contract On March 27, 2012, the Company’s board of directors resolved to sign an equity subscription contract for the Company and its subsidiary, Foxconn (Far East) Limited, to acquire 50,000 and 31,143 thousand shares of a listed company in Japan, Sharp Corporation, in the amount of JPY 27,500 million and JPY 17,128,650 thousand, respectively, for a total equity interest by the Group of 6.584%. This equity subscription contract meets the recognition criteria of a forward contract specified in IAS No. 39, “Financial Instruments: Recognition and Measurement”. The Company and its subsidiary should evaluate gain or loss based on fair value for this arrangement and also recognize related financial assets/liabilities. However, the Company could not get the approval for equity settlement because it was unable to provide related documents before July 31, 2012 as required by the competent authorities. As such, this equity subscription contract no longer met the recognition criteria of a forward contract specified in IAS No. 39. Therefore, the Company and its subsidiary reversed the loss on valuation of financial liabilities and financial liabilities of $4,513,255 and reversed deferred income tax assets and income tax benefit of $501,753, on July 31, 2012 as these amounts had been recognized during the six-month period ended June 30, 2012. The net effect of such reversals was $4,011,502. (d) The issuance of convertible bonds by the Company was recognized under financial liabilities designated at fair value through profit or loss on initial recognition due to their compound instrument feature. The Group recognized gain on valuation of convertible bonds amounting to $15,288 and $464,184 for the years ended December 31, 2013 and 2012, respectively. For the terms of the 2010 1st unsecured euro convertible bonds, please refer to Note 6(18) A. D. The Group has no financial assets at fair value through profit or loss pledged to others. (40) Available-for-sale financial assets Items December 31, 2013 December 31, 2012 January 1, 2012 Current items: Listed stocks$ 59,088 $ 57,610 $ 59,990 Adjustment of available-for- 1,028,083 719,800 614,297 sale financial assets Total $ 1,087,171 $ 777,410 $ 674,287 Non-current items: Listed stocks$ 7,125,704 $ 7,329,485 $ 6,245,534 Emerging stocks 28,740 28,740 28,740 Subtotal 7,154,444 7,358,225 6,274,274 Adjustment of available-for- 4,700,240 5,140,492 3,091,237 sale financial assets Total $ 11,854,684 $ 12,498,717 $ 9,365,511 The Group recognized net loss or gain in other comprehensive income for fair value change for the years ended December 31, 2013 and 2012. Please refer to Notes 6(27) and (28) for details.
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(41) Notes and accounts receivable
December 31, 2013 December 31, 2012 January 1, 2012 Notes receivable$ 1,359,944 $ 777,187 $ 781,288 Accounts receivable 731,109,563 601,002,740 453,197,281 Less: Allowance for sales returns ( 2,256,264) ( 1,976,759) ( 1,385,030) and allowances Allowance for doubtful ( 2,451,701) ( 2,224,178) ( 1,835,555) accounts $ 727,761,542 $ 597,578,990 $ 450,757,984
A. The Company factored its accounts receivable to certain financial institutions without recourse. Under the agreement, the Company is not required to bear uncollectible risk of the underlying accounts receivable, but is liable for the losses incurred on any business dispute, and did not provide any collateral. Accordingly, these accounts receivable meet the derecognition criteria for financial assets. The Company has derecognized the accounts receivable sold to financial institutions, net of the amount estimated for business disputes. As of December 31, 2013, December 31, 2012, and January 1, 2012, the relevant information of accounts receivable factored but unsettled were as follows: December 31, 2013 Accounts receivable Amount of accounts Amount of consideration factoring not due yet receivable derecognised Amount advanced retained $ 42,345,320 $ 42,345,320 $ 42,345,320 $ -
December 31, 2012 Accounts receivable Amount of accounts Amount of consideration factoring not due yet receivable derecognised Amount advanced retained $ 44,721,600 $ 44,721,600 $ 44,721,600 $ -
January 1, 2012 Accounts receivable Amount of accounts Amount of consideration factoring not due yet receivable derecognised Amount advanced retained $ 44,382,349 $ 44,382,349 $ 44,382,349 $ - B. As of December 31, 2013, December 31, 2012, and January 1, 2012, the Group has signed promissory notes amounting to $3,726,250 (US$125 million), $4,065,600 (US$140 million), and $3,542,760 (US$117 million) as guarantee for those accounts receivable in commercial dispute, respectively. C. For the years ended December 31, 2013 and 2012, the financing charges (expenses) incurred from accounts receivable factoring were $134,889 and $189,662 (shown as “finance costs”), respectively.
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D. The maximum exposure to credit risk at December 31, 2013, December 31, 2012, and January 1, 2012 was the carrying amount of each class of accounts receivable. E. The Group does not hold any collateral as security. (42) Other receivables December 31, 2013 December 31, 2012 January 1, 2012 Tax refund receivable $ 31,387,878 $ 30,598,424 $ 25,442,053 Receivable from purchases made on behalf of others 2,394,786 2,647,448 1,564,834 Others 6,432,690 4,990,103 7,673,009 $ 40,215,354 $ 38,235,975 $ 34,679,896
The counterparties of the Group’s other accounts receivable are good credit quality enterprises and government agencies. There is no significant compliance concerns and credit risk. (43) Inventories December 31, 2013 December 31, 2012 January 1, 2012 Raw materials and supplies$ 85,298,859 $ 87,707,668 $ 95,943,901 Work in process 79,002,138 103,684,540 73,841,392 Finished goods 150,621,589 156,262,122 196,627,104 Inventory in transit 16,429,235 20,496,593 29,648,996 331,351,821 368,150,923 396,061,393 Less: Allowance for inventory obsolescence and market price decline ( 18,566,729) ( 18,268,280) ( 15,539,599) $ 312,785,092 $ 349,882,643 $ 380,521,794
Expenses and losses incurred on inventories for the years ended December 31, 2013 and 2012 were as follows: For the years ended December 31, 2013 2012 Cost of inventories sold$ 3,700,749,467 $ 3,652,724,755 (Gain from price recovery) loss on inventory obsolescence and market price decline( 195,984) 2,777,797 Revenue from sale of scraps( 3,089,145) ( 297,521) Others 158,701 ( 58,977) $ 3,697,623,039 $ 3,655,146,054
As the Group sold some inventory with net realizable value lower than its cost, the allowance for inventory obsolescence and market price decline was reversed for the year ended December 31, 2013.
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(44) Other current assets December 31, 2013 December 31, 2012 January 1, 2012 Pledged time deposits$ 48,077 $ 947,222 $ 46,741,750 Time deposits with maturity over 5,016,244 - - three months Refundable deposits 100,840 - - $ 5,165,161 $ 947,222 $ 46,741,750 (45) Financial assets carried at cost Items December 31, 2013 December 31, 2012 January 1, 2012 Non-current item: Unlisted stocks $ 10,843,376 $ 8,591,982 $ 4,018,056 A. According to the Group’s intension, its investment in above equity instruments should be classified as ‘available-for-sale financial assets’. However, as the above equity instruments are not traded in active market, and no sufficient industry information of companies similar to the above companies or no financial information of the above companies can be obtained, the fair value of the investment in above equity instruments cannot be measured reliably. The Group classified those stocks as ‘financial assets carried at cost’. B. As of December 31, 2013, December 31, 2012, and January 1, 2012, no financial assets measured at cost held by the Group were pledged to others. (46) Investments accounted for under equity method December 31, 2013 December 31, 2012 January 1, 2012 Foxconn Technology Co., Ltd. $ 20,711,747 $ 18,671,104 $ 16,680,857 Zhen Ding Technology Holding 10,840,035 8,444,318 7,644,526 Limited Pan International Industrial 2,917,719 2,959,223 2,797,361 Corporation G-Tech Optoelectronics 2,575,294 2,943,407 2,440,357 Corporation Others 9,238,204 8,940,891 8,228,957 $ 46,282,999 $ 41,958,943 $ 37,792,058
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(a) The financial information of the Group’s principal associates is summarized below: Interest December 31, 2013 Assets Liabilities Revenue Profit/(Loss) held % Foxconn Technology $ 95,240,193 $ 25,972,250 $ 94,598,086 $ 7,011,205 30% Co., Ltd. Zhen Ding Technology 71,551,407 45,837,313 64,483,145 5,470,812 41% Holding Limited Pan International 19,339,314 7,958,994 15,460,006 488,904 27% Industrial Corporation G-Tech Optoelectronics 17,858,894 8,806,149 9,978,690 ( 1,289,992) 27% Corporation December 31, 2012 Foxconn Technology 107,450,182 46,371,311 133,616,593 8,346,276 30% Co., Ltd. Zhen Ding Technology 60,400,747 40,088,733 55,368,788 4,055,852 41% Holding Limited Pan International 19,442,360 8,026,072 17,523,052 577,873 27% Industrial Corporation G-Tech Optoelectronics 20,010,709 9,658,751 9,373,868 670,384 28% Corporation January 1, 2012 Foxconn Technology 98,084,774 43,770,573 - - 30% Co., Ltd. Zhen Ding Technology 54,090,528 36,259,248 - - 43% Holding Limited Pan International 16,185,521 5,444,521 - - 27% Industrial Corporation G-Tech Optoelectronics 12,936,124 5,415,823 - - 31% Corporation (b) The fair value of the Group’s associates which have quoted market price was as follows: December 31, 2013 December 31, 2012 January 1, 2012 Foxconn Technology Co., Ltd. $ 27,279,516 $ 33,159,570 $ 32,932,026 Zhen Ding Technology 21,742,810 21,456,435 15,664,698 Holding Limited Pan International Industrial 3,161,139 3,654,697 3,451,570 Corporation G-Tech Optoelectronics 2,722,446 5,550,466 4,643,670 Corporation (c) For the years ended December 31, 2013 and 2012, the Company’s subsidiaries have assessed and recognised impairment loss of associates of $122,620 and $0 (shown as ‘other gains and losses’), respectively.
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(47) Property, plant and equipment Machinery and Molding Construction At January 1, 2013 Land Buildings equipment equipment Others in progress Total Cost $ 3,900,934 $ 166,307,528 $ 285,431,007 $ 31,318,103 $ 91,811,531 $ 30,700,726 $ 609,469,829 Accumulated depreciation and impairment - ( 39,502,668) ( 105,825,506) ( 10,516,820) ( 48,469,759) - ( 204,314,753) $ 3,900,934 $ 126,804,860 $ 179,605,501 $ 20,801,283 $ 43,341,772 $ 30,700,726 $ 405,155,076
Year ended December 31, 2013 Opening net book amount $ 3,900,934 $ 126,804,860 $ 179,605,501 $ 20,801,283 $ 43,341,772 $ 30,700,726 $ 405,155,076 Additions 1,370 4,123 12,144,658 4,882,459 3,135,768 10,434,165 30,602,543 Transfer - 13,505,024 10,055,390 69,399 4,504,141 ( 25,874,750) 2,259,204 Disposals ( 371) ( 796,364) ( 3,009,857) ( 60,596) ( 5,237,461) ( 561,224) ( 9,665,873) Depreciation charge - ( 9,196,631) ( 40,920,460) ( 7,573,911) ( 14,995,851) - ( 72,686,853) Impairment loss - - ( 455,187) - - - ( 455,187) Net exchange differences 373,215 3,043,719 11,213,159 574,616 4,340,813 4,807,509 24,353,031 Closing net book amount $ 4,275,148 $ 133,364,731 $ 168,633,204 $ 18,693,250 $ 35,089,182 $ 19,506,426 $ 379,561,941
At December 31, 2013 Cost $ 4,275,148 $ 175,137,724 $ 296,433,194 $ 36,823,985 $ 95,517,371 $ 19,506,426 $ 627,693,848 Accumulated depreciation and impairment - ( 41,772,993) ( 127,799,990) ( 18,130,735) ( 60,428,189) - ( 248,131,907) $ 4,275,148 $ 133,364,731 $ 168,633,204 $ 18,693,250 $ 35,089,182 $ 19,506,426 $ 379,561,941
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Machinery and Molding Construction At January 1, 2012 Land Buildings equipment equipment Others in progress Total Cost $ 4,225,808 $ 151,455,281 $ 246,249,077 $ 29,013,358 $ 88,059,261 $ 29,270,077 $ 548,272,862 Accumulated depreciation and impairment - ( 31,385,787) ( 89,805,376) ( 12,519,084) ( 46,396,523) - ( 180,106,770) $ 4,225,808 $ 120,069,494 $ 156,443,701 $ 16,494,274 $ 41,662,738 $ 29,270,077 $ 368,166,092
Year ended December 31, 2012 Opening net book amount $ 4,225,808 $ 120,069,494 $ 156,443,701 $ 16,494,274 $ 41,662,738 $ 29,270,077 $ 368,166,092 Additions 13,361 8,802,484 42,231,878 17,532,838 12,446,745 22,745,591 103,772,897 Transfer - 6,533,376 15,803,746 2,280 ( 470,845) ( 21,357,362) 511,195 Disposals ( 281,783) ( 259,101) ( 3,142,598) ( 197,713) ( 2,058,383) - ( 5,939,578) Depreciation charge - ( 8,492,501) ( 35,328,823) ( 13,018,011) ( 10,651,346) - ( 67,490,681) Impairment loss - - ( 3,427,380) - - - ( 3,427,380) Net exchange differences ( 56,452) 151,108 7,024,977 ( 12,385) 2,412,863 42,420 9,562,531 Closing net book amount $ 3,900,934 $ 126,804,860 $ 179,605,501 $ 20,801,283 $ 43,341,772 $ 30,700,726 $ 405,155,076
At December 31, 2012 Cost $ 3,900,934 $ 166,307,528 $ 285,431,007 $ 31,318,103 $ 91,811,531 $ 30,700,726 $ 609,469,829 Accumulated depreciation and impairment - ( 39,502,668) ( 105,825,506) ( 10,516,820) ( 48,469,759) - ( 204,314,753) $ 3,900,934 $ 126,804,860 $ 179,605,501 $ 20,801,283 $ 43,341,772 $ 30,700,726 $ 405,155,076
The Company’s subsidiaries assessed recoverable amounts of those assets where there is an indication that they are impaired. Impairment loss of $455,187 and $3,427,380 (shown as ‘other gains and losses’) was recognized for the years ended December 31, 2013 and 2012, respectively.
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(48) Investment property Land and buildings 2013 2012 At January 1 Cost $ 1,631,839 $ 1,684,567 Accumulated depreciation and impairment ( 400,836) ( 339,227) $ 1,231,003 $ 1,345,340 Year ended December 31 Opening net book amount $ 1,231,003$ 1,345,340 Additions 1,314,372 - Disposals ( 215,360) - Depreciation charge ( 112,703)( 72,629) Net exchange differences 87,527 ( 41,708) Closing net book amount $ 2,304,839 $ 1,231,003 At December 31 Cost $ 3,149,232 $ 1,631,839 Accumulated depreciation and impairment ( 844,393) ( 400,836) $ 2,304,839 $ 1,231,003 A. Rental income from the lease of the investment property and direct operating expenses arising from the investment property are shown below: For the years ended December 31, 2013 2012 Rental revenue from the lease of the investment property $ 158,609 $ 92,091 Direct operating expenses arising from the investment property that generated rental income for the year $ 112,703 $ 72,629
B. The fair value of the investment property held by the Group as at December 31, 2013, December 31, 2012 and January 1, 2012 was $3,045,877, $1,421,325 and $1,504,989, respectively, which was revalued by independent appraisers. The valuation is based on latest market price of similar investment property in the same area and condition.
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(49) Intangible assets Concession license Goodwill Patents Total At January 1, 2013 Cost $ - $ 505,969 $ 3,448,500 $ 3,954,469 Accumulated amortization and impairment - - - - $ - $ 505,969 $ 3,448,500 $ 3,954,469 Year ended December 31, 2013 Opening net book amount$ - $ 505,969 $ 3,448,500 $ 3,954,469 Additions 9,180,000 - - 9,180,000 Amortisation charge - - ( 422,337) ( 422,337) Net exchange differences - 13,416 89,730 103,146 Closing net book amount $ 9,180,000 $ 519,385 $ 3,115,893 $ 12,815,278 At December 31, 2013 Cost$ 9,180,000 $ 519,385 $ 3,539,938 $ 13,239,323 Accumulated amortization and impairment - - ( 424,045) ( 424,045) $ 9,180,000 $ 519,385 $ 3,115,893 $ 12,815,278
Goodwill Patents Total At January 1, 2012 Cost $ 695,266 $ - $ 695,266 Accumulated amortization and impairment - - - $ 695,266 $ - $ 695,266 Year ended December 31, 2012 Opening net book amount$ 695,266 $ - $ 695,266 Additions - 3,448,500 3,448,500 Net exchange differences ( 189,297) - ( 189,297) Closing net book amount $ 505,969 $ 3,448,500 $ 3,954,469 At December 31, 2012 Cost $ 505,969 $ 3,448,500 $ 3,954,469 Accumulated amortization and impairment - - - $ 505,969 $ 3,448,500 $ 3,954,469
A. Goodwill arose mainly from the acquisition of Scientific-Atlanta de Mexico S. de R.L. de C.V. in 2011 which was accounted for using the acquisition method. B. Patents refer to the panel patents obtained from NEC in September, 2012. C. The Group has obtained 4G Mobile Broadband spectrum granted by the competent telecommunication authority on October 30, 2013, and the bid won was for A3 and B3 143 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
spectrums for a total bid price of $9,180,000 which was paid in full to the National Communications Commission. D. Concession license is amortised using the straight-line method starting from the date the license was granted until expiration. As of December 31, 2013, the license has not yet been obtained and thus, no amortisation expense was incurred. E. The details of amortization are as follows: For the years ended December 31, 2013 2012 Operating costs $ 422,337 $ -
(50) Other non-current assets
December 31, 2013 December 31, 2012 January 1, 2012 Long-term prepaid rent $ 18,470,107 $ 18,493,237 $ 21,300,084 Prepayments for equipment 1,950,002 5,308,218 2,309,167 Other financial assets - 31,800 854,748 24,179 non-current Others 3,927,648 4,854,402 3,706,703 $ 24,379,557 $ 29,510,605 $ 27,340,133 Long-term prepaid rent refers to the land use rights obtained in China. Upon signing of the lease, the amount has been paid in full. The Group recognized rental expense of $408,179 and $392,646 for the years ended December 31, 2013 and 2012, respectively. (51) Short-term loans Type of loans December 31, 2013 Interest rate range Collateral Bank loans Secured loans $ 5,811 8.04% Time deposits and cash Credit loans 366,227,790 0.58%~6.216% None $ 366,233,601 Type of loans December 31, 2012 Interest rate range Collateral Bank loans Secured loans $ 20,805 6.900% Time deposits and cash Credit loans 297,551,360 0.3354%~5.85% None $ 297,572,165
Type of loans January 1, 2012 Interest rate range Collateral Bank loans Secured loans $ 70,661,246 0.89%~3.6% Time deposits and cash Credit loans 189,861,503 0.55%~3.33% None $ 260,522,749
A. As of December 31, 2013, December 31, 2012, and January 1, 2012, the Company provided guarantees on the short-term credit facilities obtained by Foxconn Slovakia, SPOL S.R.O., a
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subsidiary of the Company, in the amount of EUR 321 million, EUR 251 million, and EUR 536 million, respectively B. As of December 31, 2013, December 31, 2012, and January 1, 2012, the Company provided guarantees on the short-term credit facilities obtained by Competition Team Technologies Limited, a subsidiary of the Company, in the amount of RMB 2 billion, RMB 1,500 million, and RMB 0, respectively. C. As of December 31, 2013, December 31, 2012, and January 1, 2012, the Company provided guarantees on the short-term credit facilities obtained by Falcon Precision Trading Limited, a subsidiary of the Company, in the amount of RMB 2 billion, RMB 0, and RMB 0, respectively. D. As of December 31, 2013, December 31, 2012, and January 1, 2012, the Company provided guarantees on the short-term credit facilities obtained by Competition Team Ireland Limited, a subsidiary of the Company, in the amount of USD 200 million and EUR 30 million, USD 100 million, and USD 0, respectively. E. The Group has signed an agreement to offset financial assets and liabilities with financial institutions in 2013. Details of the offset as of December 31, 2013 are as follows : December 31, 2013 Gross amount of Gross amount of Net amount of recognised recognised financial financial liabilities financial liabilities assets set off in the balance sheet presented in the balance sheet $ 192,553,858 $ 192,553,858 $ -
(52) Short-term notes and bills payable December 31, 2013 December 31, 2012 January 1, 2012 Commercial paper$ 20,000,000 $ 8,000,000 $ 8,000,000 Less: unamortized discount ( 17,483) ( 8,403) ( 10,688) $ 19,982,517 $ 7,991,597 $ 7,989,312 0.808%~0.898% 0.948%~1.028% 0.998%~1.158% Interest rates per annum (53) Other payables December 31, 2013 December 31, 2012 January 1, 2012 Awards and salaries payable $ 51,699,549 $ 46,680,969 $ 27,628,304 Payables for equipment 36,080,249 49,996,281 28,177,904 Consumption goods expense payable (including indirect materials) 26,698,908 15,697,913 4,442,314 Royalty fees payable 24,451,571 18,565,601 19,727,839 Employees’ bonuses payable 7,682,195 6,822,891 5,874,552 Tax payable 2,707,278 4,098,884 2,507,583 Others 41,855,428 54,405,015 34,787,358 $ 191,175,178 $ 196,267,554 $ 123,145,854
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(54) Other current liabilities
December 31, 2013 December 31, 2012 January 1, 2012 Receipts in advance $ 19,484,458 $ 27,681,170 $ 5,584,781 Deferred income 5,608,445 7,951,229 14,114,569 Bonds payable maturing within 6,410,000 31,931,536 3,000,000 one year Long-term loans maturing within 7,815,888 18,295,200 - one year Others 2,941,776 3,583,255 3,180,188 $ 42,260,567 $ 89,442,390 $ 25,879,538 (55) Bonds payable December 31, 2013 December 31, 2012 January 1, 2012 Convertible bonds payable 2010 1st unsecured euro convertible bonds payable $ - $ 31,251,000 $ 31,251,000 Less: Discount on bonds payable - ( 557,938) ( 1,260,384) Exchange differences - ( 2,171,526) ( 931,839) Subtotal - 28,521,536 29,058,777 Corporate bonds payable First unsecured corporate bonds issue in 2005 2,500,000 2,500,000 5,500,000 First debenture issue of 2009 3,410,000 6,820,000 6,820,000 First debenture issue of 2010 6,000,000 6,000,000 6,000,000 First debenture issue of 2011 6,000,000 6,000,000 6,000,000 Second debenture issue of 2011 7,050,000 7,050,000 7,050,000 Third debenture issue of 2011 4,950,000 4,950,000 4,950,000 First debenture issue of 2012 9,000,000 9,000,000 - Second debenture issue of 2012 6,000,000 6,000,000 - Third debenture issue of 2012 8,000,000 8,000,000 - Fourth debenture issue of 2012 3,300,000 3,300,000 - First debenture issue of 2013 11,050,000 - - Second debenture issue of 2013 6,950,000 - - Third debenture issue of 2013 6,000,000 - - Subtotal 80,210,000 59,620,000 36,320,000
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December 31, 2013 December 31, 2012 January 1, 2012 Foreign corporate bonds Foreign unsecured corporate bonds USD-denominated $ 19,376,500 $ 18,876,000 $ - Less: Discount on bonds payable ( 86,442) ( 105,539) - Foreign unsecured corporate bonds JPY-denominated 2,831,950 - - Foreign unsecured corporate bonds - JPY-denominated 1,132,780 - - Subtotal 23,254,788 18,770,461 - Total 103,464,788 106,911,997 65,378,777 Less: Current portion ( 6,410,000) ( 31,931,536) ( 3,000,000) $ 97,054,788 $ 74,980,461 $ 62,378,777 Bonds payable – long-term A. 2010 1st unsecured euro convertible bonds (a) On August 18, 2010, following the approval from the SFB, the Company issued the 1st unsecured euro zero coupon convertible bonds in the amount of US$1 billion. These convertible bonds cover a period of three years from October 12, 2010 to October 12, 2013. (b) Regarding the issuance of convertible bonds, the non-equity conversion options were separated from their host contracts and were recognized in ‘financial liabilities at fair value through profit or loss’ in net amount in accordance with IAS 39 because the economic characteristics and risks of the embedded derivatives were not closely related to those of the host contracts. (c) The convertible corporate bonds expired on October 12, 2013, and none of the bonds were converted into common stocks. B. First unsecured corporate bonds issue in 2005 On September 14, 2005, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $11,500,000. As of December 31, 2013, Bond Aa to Af, Bond Ba to Bf and Bond Ca to Cf had been redeemed in the amount of $9,000,000. The amount of the unredeemed bonds is $2,500,000. The terms of these domestic unsecured bonds are summarized as follows: Type of bonds Issuance date Period Amount Coupon rate Payment term Bond Da September 2005 10 years$ 500,000 2.37% Principal is due at maturity. to De per bond Interest is paid annually at simple interest rate.
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C. First debenture issue of 2009 (a) On January 12, 2009, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $6,820,000. The terms of these domestic unsecured bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term October 2009 5 years$ 6,820,000 1.72% Pay half of principal each in the fourth and fifth year. Interest is paid annually at simple interest rate. (b) As of December 31, 2013, in accordance with the conditions of the contractual arrangement, the Company has repaid $3,410,000, and the balance of $3,410,000 was transferred to current liabilities in the fourth quarter of 2013. D. First debenture issue of 2010 (a) On December 17, 2010, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $6,000,000. The terms of these domestic unsecured bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term December 2010 5 years$ 6,000,000 1.43% Pay half of principal each in the fourth and fifth year. Interest is paid annually at simple interest rate. (b) 2010 1st unsecured corporate bonds payable of $3,000,000 had been reclassified to “Current liabilities” in the fourth quarter of 2013. E. First debenture issue of 2011 On January 7, 2011, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $6,000,000. The terms of these domestic unsecured bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term March 2011 5 years$ 6,000,000 1.47% Pay half of principal each in the fourth and fifth year. Interest is paid annually at simple interest rate.
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F. Second debenture issue of 2011 On June 1, 2011, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $7,050,000. The terms of these domestic unsecured bonds are summarized as follows: Type of Issuance bonds date Period Amount Coupon rate Payment term Bond A June 2011 5 years$ 3,000,000 1.43% Principal is due at maturity. Interest is paid annually at simple interest rate. Bond B June 2011 7 years$ 2,650,000 1.66% Principal is due at maturity. Interest is paid annually at simple interest rate. Bond C June 2011 10 years$ 1,400,000 1.82% Principal is due at maturity. Interest is paid annually at simple interest rate. G. Third debenture issue of 2011 On July 6, 2011, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $4,950,000. The terms of these domestic unsecured bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term July 2011 5 years$ 4,950,000 1.51% Principal is due at maturity. Interest is paid annually at simple interest rate. H. First debenture issue of 2012 On December 28, 2011, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $9,000,000. The terms of these domestic unsecured bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term March 2012 5 years$ 9,000,000 1.34% Principal is due at maturity. Interest is paid annually at simple interest rate. I. Second debenture issue of 2012 On May 11, 2012, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $6,000,000. The terms of these domestic unsecured bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term May 2012 5 years$ 6,000,000 1.43% Principal is due at maturity. Interest is paid annually at simple interest rate.
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J. Third debenture issue of 2012 On July 27, 2012, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $8,000,000. The terms of these domestic unsecured bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term August 2012 3 years$ 8,000,000 1.18% Principal is due at maturity. Interest is paid annually at simple interest rate. K. Fourth debenture issue of 2012 On September 28, 2012, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $3,300,000. The terms of these domestic unsecured bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term October 2012 5 years$ 3,300,000 1.35% Principal is due at maturity. Interest is paid annually at simple interest rate. L. First debenture issue of 2013 On January 7, 2013, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $11,050,000. The terms of these domestic unsecured bonds are summarized as follows:
Type of bonds Issuance date Period Amount Coupon rate Payment term Bond A January 2013 5 years$ 7,450,000 1.33% Principal is due at maturity. Interest is paid annually at simple interest rate. Bond B January 2013 7 years 3,600,000 1.45% Principal is due at maturity. Interest is paid annually at simple interest rate. M. Second debenture issue of 2013 On May 6, 2013, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $6,950,000. The terms of these domestic unsecured bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term October 2013 3 years$ 6,950,000 1.45% Principal is due at maturity. Interest is paid annually at simple interest rate.
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N. Third debenture issue of 2013 On November 5, 2013, following the approval from the SFB, the Company issued domestic unsecured bonds in the amount of $6,000,000. The terms of these domestic unsecured bonds are summarized as follows: Type of Issuance bonds date Period Amount Coupon rate Payment term Bond A December 2013 3 years$ 3,000,000 1.35% Principal is due at maturity. Interest is paid annually at simple interest rate. Bond B December 2013 5 years$ 800,000 1.50% Principal is due at maturity. Interest is paid annually at simple interest rate. Bond C December 2013 7 years$ 2,200,000 1.85% Principal is due at maturity. Interest is paid annually at simple interest rate. O. Foreign unsecured corporate bonds USD-denominated On December 13, 2012, Competition Team Technologies Ltd., a subsidiary of the Company, issued foreign unsecured corporate bonds in the amount of US$ 650 million, and the Company is the guarantor of the bonds. The terms of these foreign unsecured corporate bonds are summarized as follows: Issuance date Period Amount Coupon rate December 2012 5 years USD 650 million 2.125% P. Foreign unsecured corporate bonds JPY-denominated On March 21, 2013, Foxconn (Far East) Limited, a subsidiary of the Company, issued foreign unsecured corporate bonds in the amount of JPY 10 billion, and the Company is the guarantor of the bonds. The terms of these foreign unsecured corporate bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term March 2013 3 years JPY 10 billion 1.28% Principal is due at maturity. Interest is paid annually at simple interest rate.
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Q. Foreign unsecured corporate bonds JPY-denominated On March 21, 2013, Foxconn (Far East) Limited, a subsidiary of the Company, issued foreign unsecured corporate bonds in the amount of JPY 4 billion, and the Company is the guarantor of the bonds. The terms of these foreign unsecured corporate bonds are summarized as follows: Issuance date Period Amount Coupon rate Payment term March 2013 3 years JPY 4 billion Floating rate of Principal is due at maturity. 3-month LIBOR Interest is paid annually at plus 1.10% simple interest rate.
(56) Long-term loans Interest Institution Loan period rate range Collateral December 31, 2013 Mizuho Corporate Bank 2011/3/31~2016/3/31 0.6968% None $ 14,478,900 Ltd., etc. syndicated loan 〞 2013/8/22~2016/8/22 1.2800% 〞 14,905,000 ING Bank, N.V. etc. 2010/10/22~2015/10/22 0.6850% 〞 4,519,900 syndicated loan China Development 2011/8/12~2014/8/12 1.4100% 〞 2,000,000 Industrial Bank First Commercial Bank 2011/11/30~2026/11/30 1.6803% 〞 1,523,000 Mizuho Corporate Bank 2012/6/28~2015/6/28 1.0700% 〞 3,131,061 Ltd., etc. syndicated loan Citibank 2012/9/21~2015/9/20 1.1959% 〞 1,261,041 ING Bank, N.V. etc. 2013/1/7~2020/7/29 1.7900% 〞 1,022,714 syndicated loan First Commercial Bank 2013/9/6~2033/9/6 1.7315% 〞 83,000 42,924,616 Less: Current portion ( 7,815,888) $ 35,108,728
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Interest Institution Loan period rate range Collateral December 31, 2012 Mizuho Corporate Bank 2008/8/21~2013/8/21 0.6570% None $ 11,761,200 Ltd., etc. syndicated loan 〞 2008/9/11~2013/9/11 0.6610% 〞 6,534,000 〞 2011/3/31~2014/3/31 0.7685% 〞 17,156,400 ING Bank, N.V. etc. 2010/10/22~2015/10/22 0.6380% 〞 5,581,050 syndicated loan China Development 2011/8/12~2014/8/12 1.4100% 〞 2,000,000 Industrial Bank First Commercial Bank 2011/11/30~2026/11/30 1.6803% 〞 763,000 Mizuho Corporate Bank 2012/6/28~2015/6/28 1.1773% 〞 3,742,703 Ltd., etc. syndicated loan Citibank 2012/9/21~2015/9/20 1.9100% 〞 1,464,804 49,003,157 Less: Current portion ( 18,295,200) $ 30,707,957
Interest Institution Loan period rate range Collateral January 1, 2012 Mizuho Corporate Bank 2008/8/21~2013/8/21 0.7800% None $ 12,263,400 Ltd., etc. syndicated loan 〞 2008/9/11~2013/9/11 0.8300% 〞 13,626,000 〞 2011/3/31~2014/3/31 0.7729% 〞 19,920,600 ING Bank, N.V. etc. 2010/10/22~2015/10/22 1.8040% 〞 5,681,100 syndicated loan China Development 2011/8/12~2014/8/12 1.4100% 〞 2,000,000 Industrial Bank First Commercial Bank 2011/11/30~2026/11/30 1.6803% 〞 109,000 $ 53,600,100 A. In 2008, Foxconn (Far East) Limited, a subsidiary of the Company, entered into a syndicated credit facility agreement with Mizuho Corporate Bank Ltd. as the lead bank and obtained a credit line in the amount of USD 1,035 million, with the Company as the guarantor of the loan. As of December 31, 2013, the entire loan had been repaid. B. On March 21, 2011, the Company entered into a syndicated credit facility agreement with Mizuho Corporate Bank Ltd. as the lead bank and obtained a credit line in the amount of JPY 51 billion. The partial amount of JPY 42,500 million had been extended until March 31, 2016 and will be repaid by installment over the remaining contract period. The amount of JPY 19,125 million, due within one year, had been reclassified to “Current liabilities” in the third
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quarter of 2013. C. Foxconn (Far East) Limited, a subsidiary of the Company, entered into a syndicated credit facility agreement with Mizuho Corporate Bank Ltd. as the lead bank on June 18, 2013 and obtained a credit line in the amount of USD 500 million, with the Company as the guarantor of the loan. D. Foxconn Slovakia, SPOL. S R. O., a subsidiary of the Company, entered into a syndicated credit facility agreement with ING Bank N.V. as the lead bank and obtained a credit line in the amount of EUR 410 million, of which EUR 35 million had been due for settlement and EUR 265 million had been repaid in advance. As of December 31, 2013, the credit line is EUR 110 million, with the Company as the guarantor of the loan. E. The Company entered into a comprehensive credit contract with China Development Industrial Bank on August 3, 2011, and obtained a credit line in the amount of $2 billion. The amount of $2 billion had been reclassified to “Current liabilities” in the third quarter of 2013. F. Syntrend Creative Park Co. Ltd., a subsidiary of the Company, entered into a comprehensive credit contract with First Commercial Bank on April 18, 2011, and obtained a credit line in amount of $2.5 billion. G. Honfujin Precision Electronics (Chengdu) Limited, a subsidiary of the Company, entered into a syndicated credit facility agreement with Mizuho Corporate Bank Ltd. and Sumitomo Mitsui Banking Corporation on June 11, 2012, and obtained a credit line in the amount of JPY 11 billion, with the Company as the guarantor of the loan. H. Honfujin Precision Electronics (Chengdu) Limited, a subsidiary of the Company, entered into a U.S. dollar regular loan commitment agreement with Citibank (China) Ltd., and obtained a credit line in the amount of USD 50 million on September 21, 2012, with the Company as the guarantor of the loan. I. The Company entered into a comprehensive credit facility agreement with ING Bank, N.V. as the lead bank and the loan amount is JPY 3,602,374 thousand, which will be repaid by installment over the contract period. The amount of JPY 514,626 thousand, due within one year, had been reclassified to “Current liabilities” in the fourth quarter of 2013. J. Altus Technology Inc., Ingrasys Technology Inc. and Dynamic Computing Technology Co., Ltd., subsidiaries of the Company, entered into a comprehensive credit contract with First Commercial Bank on October 19, 2012, and obtained a credit line in the amount of $1,390,000. K. Throughout the term of Mizuho Corporate Bank Ltd., ING Bank, N.V., Citibank (China) Ltd., and China Development Industrial Bank, etc. syndicated term loan agreement, the Group shall maintain the agreed financial ratios, to be tested semi-annually and annually on consolidated basis.
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(57) Pensions A. Defined benefit plans (a) The Company has a defined benefit pension plan in accordance with the Labor Standards Law, covering all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Law. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement. The Company contributes monthly an amount equal to 2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee. (b) The amounts recognized in the balance sheet are determined as follows (shown as “Other non-current liabilities”) : December 31, 2013 December 31, 2012 January 1, 2012 Present value of funded $ 2,171,528 $ 2,174,055 $ 1,946,661 obligations Fair value of plan assets ( 632,662) ( 645,316) ( 621,909) $ 1,538,866 $ 1,528,739 $ 1,324,752
(c) Changes in present value of funded obligations are as follows:
2013 2012 Present value of funded obligations At January 1 $ 2,174,055 $ 1,946,661 Current service cost 31,609 33,533 Interest expense 32,611 34,067 Actuarial profit and loss( 2,539) 188,467 Benefits paid ( 64,208) ( 28,673) $ 2,171,528 $ 2,174,055 At December 31 (d) Changes in fair value of plan assets are as follows: 2013 2012 Fair value of plan assets At January 1 $ 645,316 $ 621,909 Expected return on plan assets 9,680 10,883 Actuarial profit and loss( 1,559) ( 5,387) Employer contributions 43,433 46,584 Benefits paid ( 64,208) ( 28,673) At December 31 $ 632,662 $ 645,316
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(e) Amounts of expenses recognised in statements of comprehensive income are as follows: 2013 2012 Current service cost$ 31,609 $ 33,533 Interest cost 32,611 34,067 Expected return on plan assets ( 9,680) ( 10,884) $ 54,540 $ 56,716 Current pension costs Details of cost and expenses recognised in statements of comprehensive income are as follows: 2013 2012 Cost of sales $ 8,884 $ 8,717 Selling expenses 3,819 4,431 General and administrative expenses 18,124 17,760 Research and development expenses 23,713 25,808 $ 54,540 $ 56,716 (f) Amounts recognised under other comprehensive income are as follows: 2013 2012 Actuarial profit (loss) recognized $ 980 ($ 193,854) ($ 192,874) ($ 193,854) Accumulated actuarial loss (g) The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined benefit pension plan in accordance with the Fund’s annual investment and utilisation plan and the “Regulations for Revenues, Expenditures, Safeguard and Utilisation of the Labor Retirement Fund” (Article 6: The scope of utilisation for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over- the-counter, or private placement equity securities, investment in domestic or foreign real estate securitization products, etc.). With regard to the utilisation of the Fund, its minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from two-year time deposits with the interest rates offered by local banks. The constitution of fair value of plan assets as of December 31, 2012 and 2013 is given in the Annual Labor Retirement Fund Utilisation Report published by the government. Expected return on plan assets was a projection of overall return for the obligations period, which was estimated based on historical returns and by reference to the status of Labor Retirement Fund utilisation by the Labor Pension Fund Supervisory Committee and taking into account the effect that the Fund’s minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from two-year time deposits with the interest rates offered by local banks. Actual returns on plan assets of the Company were $8,121 and $5,496 for the years ended December 31, 2013 and 2012, respectively.
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(h) The principal actuarial assumptions used were as follows: 2013 2012 2011 Discount rate 2.00% 1.50% 1.75% Future salary increases 3.50% 3.00% 3.00% 2.00% 1.50% 1.75% Expected return on plan assets Assumptions regarding future mortality experience are set based on actuarial advice in accordance with published statistics and experience in each territory. (i) Historical information of experience adjustments was as follows: 2013 2012 Present value of defined benefit obligation$ 2,171,528 $ 2,174,055 Fair value of plan assets ( 632,662) ( 645,316) Deficit in the plan $ 1,538,866 $ 1,528,739 Experience adjustments on plan liabilities $ 9,864 $ 103,383 Experience adjustments on plan assets ($ 1,559) ($ 5,387) (j) Expected contributions to the defined benefit pension plans of the Group within one year from December 31, 2013 is $54,371. B. Defined contribution plans (a) Effective July 1, 2005, the Company and its domestic subsidiaries have established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company and its domestic subsidiaries contribute monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment. (b) The subsidiaries in mainland China have defined contribution pension plans and contribute an amount monthly based on 8%~9% of employees’ monthly salaries and wages to an independent fund administered by a government agency. The plan is administered by the government of mainland China. Other than the monthly contributions, the Group does not have further pension liabilities. (c) As of December 31, 2013, December 31, 2012 and January 1, 2012, the subsidiaries which participated in defined contribution pension plans recognized reserve according to the respective local laws for retirement plan in the amount of $106,152, $202,707 and $192,959, respectively .The pension costs under the defined contribution pension plans of the Group for the years ended December 31, 2013 and 2012 were $15,761,823 and $15,574,657, respectively.
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(58) Share-based payment As of December 31, 2013 and 2012, the share-based payment transactions of FIH Mobile Limited (formerly: Foxconn International Holdings Limited), a subsidiary of the Company (listed on the Stock Exchange of Hong Kong), are set forth below: Quantity Contract Vesting Type of arrangement Grant date granted period conditions Employee stock options July 8, 2011 256,159,719 1~3 years Note (1) Other share-based December 29, 2006 5,748,145 - Note (2)(9) payment plans " July 24, 2007 502,090 - Note (3)(9) " December 28, 2007 20,459,322 - Note (4)(9) " October 29, 2009 26,161,489 - Note (9) " April 27, 2010 9,435,264 - " " November 19, 2010 25,616,428 - " " December 29, 2010 35,573,029 - " " April 29, 2011 3,302,725 - " " July 8, 2011 5,138,266 - " " October 18, 2011 21,948,624 - " " December 29, 2011 62,423,773 - Note (5)(9) " December 28, 2012 135,564,990 - Note (6)(9) " April 22, 2013 10,633,361 - Note (7)(9) " October 17, 2013 92,215,205 - Note (8)(9) Note 1: Vested upon completion of certain years’ service. Note 2: Of the shares granted, 2,737,718 shares cannot be sold within 1 to 3 years from the grant date. Note 3: Of the shares granted, 407,000 shares cannot be sold within 1 to 2 years from the grant date. Note 4: Of the shares granted, 20,362,078 shares cannot be sold within 1 to 3 years from the grant date. Note 5: Of the shares granted, 13,939,379 shares cannot be sold within 1 to 2 years from the grant date. Note 6: Of the shares granted, 14,934,766 shares cannot be sold within 1 to 2 years from the grant date. Note 7: Of the shares granted, 6,210,640 shares cannot be sold within 1 to 2 years from the grant date. Note 8: Of the shares granted, 33,957,285 shares cannot be sold within 1 to 2 years from the grant date. Note 9: Vested immediately.
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A. Employee stock options For the stock options granted with the compensation cost accounted for using the fair value method, their fair value on the grant date is estimated using the Black-Scholes option-pricing model. The parameters used in the estimation of the fair value are as follows: Stock Exercise Exercise Expected Fair value price price price dividend Risk-free per share Grant date (HK$) (HK$) volatility yield rate interest rate (US$) July 8, 2011$ 3.62 $ 3.62 37% - 0.297%~0.667%$ 0.11 (a) For the years ended December 31, 2013 and 2012, the weighted-average exercise price of employee stock options outstanding were US$0.6 and US$0.7 (in dollars) per share, respectively. For the years ended December 31, 2013 and 2012, expenses incurred on employee stock options transactions were $86,101 (US$2,900 thousand) and $245,461 (US$8,301 thousand), respectively. (b) Details of the employee stock options are set forth below: For the years ended December 31, 2013 2012 Options outstanding at beginning of year 206,374,634 253,061,762 Options exercised( 36,055,551) ( 29,548,295) Options revoked ( 12,648,992) ( 17,138,833) Options outstanding at end of year 157,670,091 206,374,634 86,140,498 51,323,616 Options exercisable at end of year B. Other share-based payment plans These share-based payments were granted to employees without consideration received. For the years ended December 31, 2013 and 2012, expenses incurred on other share-based payments were $1,330,587 (US$44,816 thousand) and $1,946,238 (US$65,818 thousand), respectively. (59) Other non-current liabilities December 31, 2013 December 31, 2012 January 1, 2012 Reserve for retirement plan$ 1,645,018 $ 1,731,446 $ 1,517,711 Government grants 3,386,876 2,059,834 2,657,988 Others 4,162,317 3,327,804 2,080,986 $ 9,194,211 $ 7,119,084 $ 6,256,685
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(60) Provisions Warranty At January 1, 2013 $ 3,464,280 Additional provisions 960,181 Used during the year ( 98,529) Unused amounts reversed ( 1,918,184) Exchange differences ( 1,412) $ 2,406,336 At December 31, 2013 Analysis of total provisions: December 31, 2013 December 31, 2012 January 1, 2012 $ 2,406,336 $ 3,464,280 $ 7,302,884 Current The Group provides warranties on 3C products sold. Provision for warranty is estimated based on historical warranty data of 3C products. (61) Capital stock A. On June 26, 2013, the Company’s shareholders adopted a resolution to increase the authorized shares to 18 billion shares. As of December 31, 2013, the Company’s authorized capital was $150,000,000, consisting of 15 billion shares of ordinary stock, and the paid-in capital was $131,287,068, consisting of 13,128,707 thousand shares with a par value of $10 (in dollars) per share. All proceeds from shares issued have been collected. Movements in the number of the Company’s ordinary shares outstanding are as follows: 2013 2012 (Shares in thounsands) (Shares in thounsands) At January 1 11,835,867 10,689,097 Stock dividends 1,183,586 1,068,910 Employees’ stock bonus 109,254 77,860 13,128,707 11,835,867 At December 31 B. Pursuant to the resolution adopted at the stockholders' meeting held on June 1, 1999, and after obtaining approval from the SFC, the Company issued 25 million units of global depository receipts (GDRs) in Europe, Asia and the USA, comprising 50 million shares of common stock (Deposited Shares). The issuance amounted to USD347,250 thousand, and the main terms and conditions of the GDRs are as follows: (a) Voting Holders of GDRs have no right to directly exercise voting rights or attend the Company’s stockholders' meeting, except when a motion is on the election of directors or supervisors. A holder or holders together holding at least 51% of the GDRs outstanding at the relevant record date of the stockholders' meeting can instruct the Depositary to vote in the same direction in respect of one or more resolutions to be proposed at the meeting.
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(b) Sale and withdrawal of GDRs Under the current R.O.C. law, shares represented by the GDRs may be withdrawn by holders of GDRs commencing three months after the initial issue of GDRs. A holder of a GDR may, provided that the Company has delivered to the custodian physical share certificates in respect of the Deposited Shares, request the Depositary to sell or cause to be sold on behalf of such holder the shares represented by such GDRs. (c) Dividends GDR holders are entitled to receive dividends to the same extent as the holders of common stock. (d) As of December 31, 2013, 143,068 thousand units of GDRs were outstanding, which represents 286,135 thousand shares of common stock. C. Treasury stocks The Company's subsidiary, Hong Jingguo International Investment Co., Ltd., acquired ordinary shares issued by the Company in 1998. As of December 31, 2013, December 31, 2012, and January 1, 2012, the subsidiary owned 1,433,093, 1,302,812 and 1,184,375 shares, respectively, of the Company’s common stock at a cost of $18,901. (62) Capital surplus Pursuant to the R.O.C. Company Act, capital reserve arising from paid-in capital in excess of par value on issuance of common stocks and donations can be used to cover accumulated deficit or to issue new stocks or cash to shareholders in proportion to their share ownership, provided that the Company has no accumulated deficit. Further, the R.O.C. Securities and Exchange Law requires that the amount of capital reserve to be capitalized mentioned above should not exceed 10% of the paid-in capital each year. Capital reserve should not be used to cover accumulated deficit unless the legal reserve is insufficient. (63) Retained earnings A. In accordance with the Company’s Articles of Incorporation, current year’s earnings must be distributed in the following order: (a) Covering accumulated deficit; (b) Setting aside as legal reserve equal to 10% of current year’s net income after tax and distribution pursuant to clause (A); (c) Setting aside a special reserve in accordance with applicable legal and regulatory requirement; (d) 8% as bonuses to employees; qualified employees include employees of affiliates per criteria set by Board of Directors; and (e) the remainder shall be distributed pursuant to the proposal of the board of directors in accordance with the Company’s dividend policy. The Company’s dividend policy requires the board of directors to consider the Company’s budget for future capital expenditures and funding needs when proposing the distribution of earnings. The proposal should be resolved during the Stockholders’ Meeting. Dividends may be distributed in the form of cash or shares, or a combination of both, provided, however, that cash dividends distributed in respect of any fiscal year shall not exceed 90 percent of total
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dividends to stockholders. B. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the balance of the reserve exceeds 25% of the Company’s paid-in capital. C. In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings. D. The appropriations of 2012 and 2011 earnings had been resolved at the stockholders’ meeting on June 26, 2013 and June 18, 2012, respectively. Details are summarized below: 2012 2011 Dividends per Dividends per Amount share (in dollars) Amount share (in dollars) Legal reserve$ 9,476,237 $ - $ 8,159,100 $ - Stock dividends 11,835,866 1.0 10,689,096 1.0 Cash dividends 17,753,800 1.5 16,033,645 1.5 $ 39,065,903 $ 2.5 $ 34,881,841 $ 2.5
As of March 28, 2014, the distribution of 2013 earnings had not been approved by the board of directors. The information on distribution of earnings will be posted on the “Market Observation Post System” of the TSEC. E. For the years ended December 31, 2013 and 2012, employees’ bonus was accrued at $7,682,195 and $6,822,891, respectively, based on 8% of net income, and are recognized as operating costs and expenses in current year. The information on employees’ bonus and directors’ and supervisors’ remuneration is posted on the “Market Observation Post System” at the website of the TSEC. Employees’ bonus for 2012 as resolved by the stockholders on June 26, 2013 were in agreement with those amounts recognized in the 2012 financial statements. Actual number of shares distributed as employees’ bonus for the year ended December 31, 2012 is 109,254 thousand shares. Calculation basis of the shares is based on the closing price of the Company’s common stock at $62.45 (in dollars) per share, on June 25, 2013, the previous day of the 2013 shareholders’ meeting after taking into account the effects of ex- rights and ex-dividends.
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(64) Other equity items Currency translation Available-for-sale adjustments investment Total At January 1, 2013 $ 1,370,511 $ 6,435,046 $ 7,805,557 - Group 23,993,394 ( 988,310) 23,005,084 - Associates 1,069,042 ( 150,822) 918,220 At December 31, 2013$ 26,432,947 $ 5,295,914 $ 31,728,861 Currency translation Available-for-sale adjustments investment Total At January 1, 2012 $ 21,047,357 $ 4,447,831 $ 25,495,188 - Group( 18,666,225) 1,747,132 ( 16,919,093) - Associates( 1,010,621) 240,083 ( 770,538) At December 31, 2012$ 1,370,511 $ 6,435,046 $ 7,805,557
(65) Non-controlling interests For the years ended December 31, 2013 2012 At January 1 $ 36,064,490 $ 37,187,796 Share attributable to non-controlling interests: Gain (loss) for the year 648,719 ( 2,975,236) Currency translation differences 624,301 ( 70,926) Unrealized gains and losses on available-( 13,707) 8,698 for-sale financial assets Increase in non-controlling interests 3,930,733 1,914,158 At December 31 $ 41,254,536 $ 36,064,490 Certain subsidiaries of the Group have issued employee share-based payment and new shares during 2013 and 2012. The Group has not purchased additional shares in proportion to its ownership and thus, the Group has increased non-controlling interest by $3,930,733 and $1,914,158, and increased equity attributable to owners of the parent by $18,325 and $33,840 as of December 31, 2013 and 2012, respectively. (66) Operating revenue For the years ended December 31, 2013 2012 3C products (Contain components and related electronic products)$ 3,952,317,540 $ 3,905,395,322
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(67) Other income For the years ended December 31, 2013 2012 Rental revenue $ 441,754 $ 315,951 Dividend income 419,216 289,536 Interest income: Interest income from bank deposits 10,845,494 13,348,559 Other non-operating income 5,825,314 4,065,799 $ 17,531,778 $ 18,019,845 Total (68) Other gains and losses For the years ended December 31, 2013 2012 Net gains on financial assets at fair value through profit or loss $ 820,645 $ 21,776 Net (loss) gain on financial liabilities at fair value through profit or loss( 1,132,639) 464,184 Net currency exchange gain 13,796,088 1,435,180 (Loss) gain on disposal of property, plant and equipment ( 559,393) 153,958 Gain on disposal of investment 1,427,121 1,644,484 Impairment loss ( 577,807) ( 3,427,380) Other gains (losses) 89,786 ( 790,173) Total $ 13,863,801 ($ 497,971) (69) Expenses by nature Additional disclosures related to cost of sales and operating expenses are as follows:
For the years ended December 31, 2013 2012 Royalty expenses $ 54,836,542 $ 44,570,271 Product warranty costs 58,262,924 34,382,737 Employee benefit expense 278,200,502 270,039,859 Depreciation 72,686,853 67,490,681 Amortisation 926,373 392,646 Total $ 464,913,194 $ 416,876,194
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(70) Employee benefit expense For the years ended December 31, 2013 2012 Wages and salaries$ 235,162,293 $ 227,223,568 Employee stock options 1,416,688 2,191,699 Labor and health insurance fees 12,182,952 11,702,871 Pension costs 15,816,363 15,631,373 Other personnel expenses 13,622,206 13,290,348 $ 278,200,502 $ 270,039,859
(71) Financial costs For the years ended December 31, 2013 2012 Interest expense: Bank borrowings $ 6,994,619 $ 8,025,989 Bonds payable 2,122,845 1,570,772 Financing charges from accounts receivable factoring 134,889 189,662 $ 9,252,353 $ 9,786,423 (72) Income tax A. Income tax expense (a)Components of income tax expense: For the years ended December 31, 2013 2012 Current tax: Income tax generated from current income$ 30,114,171 $ 26,326,337 Adjustments in respect of prior years 1,651,818 315,890 Total current tax 31,765,989 26,642,227 Deferred tax: Origination and reversal of temporary differences ( 2,816,168) ( 136,878) Income tax expense $ 28,949,821 $ 26,505,349
(b) The income tax (charge)/credit relating to components of other comprehensive income are as follows: For the years ended December 31, 2013 2012 Actuarial (losses) gains on defined benefit obligations ($ 167) $ 32,955
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B. Reconciliation between income tax expense and accounting profit For the years ended December 31, 2013 2012 Income tax at the statutory tax rate$ 32,775,474 $ 30,550,284 Effects from items disallowed by tax regulation( 11,505,971) ( 9,503,844) Under provision of prior year's income tax 1,651,818 315,890 Additional 10% tax on undistributed earnings 5,572,158 4,792,818 Others 456,342 350,201 Income tax expense 28,949,821 26,505,349 Changes in deferred income tax 2,816,168 136,878 Under provision of prior year's income tax ( 1,651,818) ( 315,890) Prepaid income tax ( 9,018,855) ( 9,441,763) Income tax payable for prior years 2,927,439 2,282,853 Others 135,723 9,779 $ 24,158,478 $ 19,177,206 Current income tax liability
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C. Amounts of deferred tax assets or liabilities as a result of temporary differences are as follows: For the year ended December 31, 2013 Recognised in Recognised in other January 1 profit or loss comprehensive income December 31 Temporary differences: -Deferred tax assets: Allowance for sales allowances $ 336,049 $ 47,516 $ - $ 383,565 Reserve for inventory obsolescence and market price decline 1,241,694 1,499,429 - 2,741,123 Deferred income 1,579,609 ( 469,266) - 1,110,343 Unrealized expenses 3,857,661 825,243 - 4,682,904 Difference from finance and tax due to depreciation expense 1,557,402 2,283,838 - 3,841,240 Reserve for pension cost 260,714 1,715 ( 167) 262,262 Unused compensated absences 413,440 94,697 - 508,137 Others 1,705,333 602,134 - 2,307,467 Subtotal 10,951,902 4,885,306 ( 167) 15,837,041 -Deferred tax liabilities: Foreign investment income using equity method ( 3,509,407) ( 1,089,481) - ( 4,598,888) Unrealised exchange gain ( 639,558) ( 713,483) - ( 1,353,041) Others - ( 266,174) - ( 266,174) Subtotal ( 4,148,965) ( 2,069,138) - ( 6,218,103) $ 6,802,937 $ 2,816,168 ($ 167) $ 9,618,938 Total
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For the year ended December 31, 2012 Recognised in Recognised in other January 1 profit or loss comprehensive income December 31 Temporary differences: －Deferred tax assets: Allowance for sales allowances $ 235,455 $ 100,594 $ - $ 336,049 Reserve for inventory obsolescence and market price decline 1,425,601 ( 183,907) - 1,241,694 Unrealised exchange loss 83,458 ( 83,458) - Deferred income 3,298,507 ( 1,718,898) - 1,579,609 Unrealized expenses 2,829,602 1,028,059 - 3,857,661 Difference from finance and tax due to depreciation expense 957,037 600,365 - 1,557,402 Reserve for pension cost 225,947 1,812 32,955 260,714 Unused compensated absences 333,352 80,088 - 413,440 Others 1,171,746 533,587 - 1,705,333 Subtotal 10,560,705 358,242 32,955 10,951,902 －Deferred tax liabilities: Foreign investment income using equity method ( 3,927,601) 418,194 - ( 3,509,407) Unrealised exchange gain - ( 639,558) - ( 639,558) Subtotal ( 3,927,601) ( 221,364) - ( 4,148,965) $ 6,633,104 $ 136,878 $ 32,955 $ 6,802,937 Total D. The Company did not recognise taxable temporary differences associated with investment in subsidiaries as deferred tax liabilities. As of December 31, 2013, December 31, 2012 and January 1, 2012, the amounts of temporary differences unrecognised as deferred tax liabilities were $521,554,443, $429,724,205 and $388,759,079, respectively. E. The Company’s income tax returns through 2011 have been assessed and approved by the Tax Authority. F. Unappropriated retained earnings:
December 31, 2013 December 31, 2012 January 1, 2012 Earnings generated in and $ 2,163,509 $ 2,163,509 $ 2,163,509 before 1997 Earnings generated in and 465,259,917 397,627,850 338,028,618 after 1998 $ 467,423,426 $ 399,791,359 $ 340,192,127 Total
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G. The stockholders’ deductible tax and expected deductible tax rate are as follows: December 31, 2013 December 31, 2012 January 1, 2012 Balance of stockholders deductible tax account $ 48,383,653 $ 42,643,444 $ 36,028,854
2013 (Expected) 2012 (Actual) Tax deductible rate of earnings distribution 12.69% 12.69% (73) Earnings per share For the year ended December 31, 2013 Weighted average number of ordinary Earnings Amount shares outstanding per share after tax (shares in thousands) (in dollars) Basic earnings per share Profit attributable to ordinary shareholders of the parent $ 106,697,157 13,074,723 $ 8.16 Diluted earnings per share: Profit attributable to ordinary shareholders$ 106,697,157 13,074,723 of the parent Assumed conversion of all dilutive potential ordinary shares Convertible bonds-overseas 530,606 195,649 Employees’ bonus - 158,179 Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares $ 107,227,763 13,428,551 $ 7.99
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For the year ended December 31, 2012 Weighted average number of ordinary Earnings Amount shares outstanding per share after tax (shares in thousands) (in dollars) Basic earnings per share Profit attributable to ordinary shareholders of the parent $ 94,641,972 13,018,020 $ 7.27 Diluted earnings per share: Profit attributable to ordinary shareholders$ 94,641,972 13,018,020 of the parent Assumed conversion of all dilutive potential ordinary shares Convertible bonds-overseas 553,057 280,047 Employees’ bonus - 84,423 Profit attributable to ordinary shareholders of the parent plus assumed conversion of all dilutive potential ordinary shares $ 95,195,029 13,382,490 $ 7.11 The number of shares had retroactively been adjusted by the stock dividends as of December 31, 2013. (74) Non-cash transaction Investing activities with partial cash payments For the years ended December 31, 2013 2012 Purchase of property, plant and equipment$ 30,602,543 $ 103,772,897 Add: opening balance of payable on equipment 49,996,281 28,177,904 Less: ending balance of payable on equipment ( 36,080,249) ( 49,996,281) Net exchange differences ( 123,410) ( 1,487,858) Cash paid during the period $ 44,395,165 $ 80,466,662
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7. RELATED PARTY TRANSACTIONS (75) Significant transactions and balances with related parties A. Sales For the years ended December 31, 2013 2012 Sales of goods: Associates $ 60,800,971 $ 93,119,063 Other related party 35,495,922 25,014,498 $ 96,296,893 $ 118,133,561
The amounts above include administration and service revenue. Goods are sold based on the price lists in force and terms that would be available to third parties. B. Purchases For the years ended December 31, 2013 2012 Purchase of goods: Associates $ 82,686,980 $ 85,526,265 Other related party 7,640,233 27,966,527 $ 90,327,213 $ 113,492,792
Purchases from related enterprises are based on normal commercial terms and conditions. C. Accounts receivable December 31, 2013 December 31, 2012 January 1, 2012 Receivables from related parties: Associates$ 8,885,391 $ 22,951,143 $ 18,108,098 Other related party 11,062,867 12,518,508 7,183,713 $ 19,948,258 $ 35,469,651 $ 25,291,811
Receivables from related parties primarily come from sales transactions. The amount is due 30 to 90 days after the transaction date. The receivables are unsecured and non-interest bearing.
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D. Accounts payable December 31, 2013 December 31, 2012 January 1, 2012 Payables to related parties: Associates$ 27,714,786 $ 31,279,334 $ 25,612,019 Other related party 2,046,953 4,335,513 3,157,158 $ 29,761,739 $ 35,614,847 $ 28,769,177
Payables to related parties primarily arose from purchase transactions and procurement of raw materials on behalf of others. The amount is due 30 to 90 days after the transaction date. The payables are non-interest bearing. E. Property transactions: a) Proceeds from sale of property and gain (loss) on disposal: For the years ended December 31, 2013 2012 Proceeds from sale Proceeds from sale of property, plant of property, plant and equipment Gain and equipment Gain Sale of property, plant and equipment: Associates$ 1,065,491 $ 67,906 $ 635,193 $ 11,615 Other related party 50,688 15,933 33,912 - $ 1,116,179 $ 83,839 $ 669,105 $ 11,615
b) Period-end balances arising from sale of property (shown as “other receivables”):
December 31, 2013 December 31, 2012 January 1, 2012 Sale of property, plant and equipment Associates$ 238,917 $ 82,370 $ 299,053 Other related party 13,457 222,399 13,474 $ 252,374 $ 304,769 $ 312,527 c) Acquisition of properties: For the years ended December 31, 2013 2012 Acquisition of property, plant and equipment: Associates $ 524,383 $ 432,515 Other related party 69,674 1,695,970 $ 594,057 $ 2,128,485
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For the years ended December 31, 2013 2012 Acquisition of interest $ - $ 115,404 Other related party
d) Period-end balance arising from acquisition of properties (shown as “other payables”):
December 31, 2013 December 31, 2012 January 1, 2012 Acquisition of property, plant and equipment: Associates$ 261,735 $ 130,895 $ 93,543 Other related party 272,027 30,932 - $ 533,762 $ 161,827 $ 93,543
F. Purchase of materials on behalf of related parities (shown as “other receivables”): December 31, 2013 December 31, 2012 January 1, 2012 Period-end balance of receivables from procurement of raw materials on behalf of related parties: Associates$ 116,987 $ 100,147 $ 494,625 Other related party 2,041,578 1,791,387 1,071,209 $ 2,158,565 $ 1,891,534 $ 1,565,834
G. Prepayment December 31, 2013 December 31, 2012 January 1, 2012 Ending balance of prepayment to related parties: $ 39,225 $ 44,225 $ 44,225 Associates H. Loans to related parties Receivables from related parties December 31, 2013 December 31, 2012 January 1, 2012 Associates $ - $ 200,000 $ - Interest income For the years ended December 31, 2013 2012 Associates $ 5,975 $ - Interest on loans to associates (shown as “other receivables”) was charged at the rate of 1.625% for the year ended December 31, 2013.
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(76) Key management compensation For the years ended December 31, 2013 2012 Salaries and other short-term employee benefits$ 433,105 $ 476,892 Service execution fees 1,080 1,729 Share-based payments 51,993 33,887 Total $ 486,178 $ 512,508 8. PLEDGED ASSETS As of December 31, 2013, December 31, 2012, and January 1, 2012, the book value of the Group’s pledged assets are as follows: Assets Nature December 31, 2013 December 31, 2012 January 1, 2012 Time deposits and Short-term loans, $ 48,077 $ 947,222 $ 46,741,750 cash (shown as customs deposits “other current assets”) Time deposits and Bond deposit as cash (shown as security for court “other non-current proceedings, assets”) security deposit for employment of foreign employees and customs deposits 31,800 854,748 24,179 $ 79,877 $ 1,801,970 $ 46,765,929 9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT COMMITMENTS (77) Contingencies None. (78) Commitments A. Capital commitments Capital expenditure contracted for at the balance sheet date but not yet incurred is as follows: December 31, 2013 December 31, 2012 January 1, 2012 Property, plant and $ 6,220,274 $ 4,204,000 $ 7,579,000 equipment B. Operating lease commitments The Company’s subsidiary leases factory dormitory under non-cancellable operating lease agreements. The lease terms are between 5 and 10 years, and the majority of lease agreements are renewable at the end of the lease period at market rate.
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The future aggregate minimum lease payments under non-cancellable operating leases are as follows: December 31, 2013 December 31, 2012 January 1, 2012 Not later than one year$ 500,808 $ 538,248 $ 521,903 Later than one year but not later than five years 917,431 1,256,117 1,152,039 Later than five years 118,465 82,676 100,842 $ 1,536,704 $ 1,877,041 $ 1,774,784
C. The Group entered into an agreement with Qualcomm Incorporated regarding mobile phone use right. Under the agreement, the Group shall pay royalties based on sales volume of the related products. D. The subsidiary, Syntrend Creative Park Co. Ltd., entered into a “Private Participation in Construction and Operation of Taipei Information Park and Parking Lots” contract with Taipei City Government, and the royalty shall be paid in accordance with the contract time schedule. 10. SIGNIFICANT DISASTER LOSS None. 11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE A. On March 18, 2014, the Company has issued the first unsecured corporate bonds of 2014. Total issuance amounted to $6,000,000, consisting of: $2,050,000 with a coupon rate of 1.23% and an issuance period of 3 years; $1,100,000 with a coupon rate of 1.40% and an issuance period of 5 years; $350,000 with a coupon rate of 1.75% and an issuance period of 7 years; and $2,500,000 with a coupon rate of 2.00% and an issuance period of 10 years. B. A domestic unsecured corporate bonds issuance was approved by the Board of Directors on March 28, 2014, with the total amount of not more than $24,000,000 and the bonds shall be issued in multiple series. 12. OTHERS (1) Capital management The Group’s objectives when managing capital are to safeguard the Group’s ability to operate with the goal to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, issue new shares or sell assets to reduce debt. The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including ‘current and non-current borrowings’ as shown in the consolidated balance sheet) less cash and cash equivalents. Total capital is calculated as ‘equity’ as shown in the consolidated balance sheet less the total of intangible assets. During 2013, the Group’s strategy, which was unchanged from 2012, was to maintain the gearing
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(2) Financial instruments A. Fair value information of financial instruments December 31, 2013 Book value Fair value Financial assets: Financial assets with fair values equal to book values$ 1,501,289,127 $ 1,501,289,127 Financial assets measured at cost 10,843,376 - $ 1,512,132,503 $ 1,501,289,127
December 31, 2012 Book value Fair value Financial assets: Financial assets with fair values equal to book values$ 1,192,209,189 $ 1,192,209,189 Financial assets measured at cost 8,591,982 - $ 1,200,801,171 $ 1,192,209,189
January 1, 2012 Book value Fair value Financial assets: Financial assets with fair values equal to book values$ 897,399,380 $ 897,399,380 Financial assets measured at cost 4,018,056 - $ 901,417,436 $ 897,399,380
December 31, 2013 Book value Fair value Financial liabilities: Financial liabilities with fair values equal to book values$ 1,304,361,278 $ 1,304,361,278 Bonds payable 97,054,788 93,356,250 Long-term loans 35,108,728 33,965,186 $ 1,436,524,794 $ 1,431,682,714
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December 31, 2012 Book value Fair value Financial liabilities: Financial liabilities with fair values equal to book values$ 1,190,510,748 $ 1,190,510,748 Bonds payable 74,980,461 69,980,009 Long-term loans 30,707,957 30,081,842 $ 1,296,199,166 $ 1,290,572,599
January 1, 2012 Book value Fair value Financial liabilities: Financial liabilities with fair values equal to book values$ 943,874,186 $ 943,874,186 Bonds payable 62,378,777 60,894,339 Long-term loans 53,600,100 52,324,562 $ 1,059,853,063 $ 1,057,093,087
The financial assets with fair value that equals to book value include cash and cash equivalents, financial assets measured at fair value through profit or loss, available-for-sale financial assets, notes and accounts receivable and other financial assets; The financial liabilities with fair value that equals to book value include short-term bank loan, financial liabilities measured at fair value through profit or loss, notes and accounts payable and current portion of the long-term liabilities. B. Financial risk management policies (a) Risk categories: The Group employs a comprehensive risk management and control system to clearly identify, measure, and control the various kinds of financial risk it faces, including market risk (including foreign exchange risk, interest rate risk and price risk), credit risk, and liquidity risk. (b) Management objectives: i. Except for market risk, which is controlled by outside factors, the remainder of the foregoing types of risks can be controlled internally or removed from business processes. Therefore, the goal in managing each of these risks is to reduce them to zero. ii. As for market risk, the goal is to optimize its overall position through strict analyze, suggestion, execution and audit processes, and proper consideration of a) long-term trends in the external economic/financial environment, b) internal operating conditions, and c) the actual effects of market fluctuations.
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iii. The Group's overall risk management policy focuses on the unpredictable item of financial markets and seeks to reduce the risk that potentially pose adverse effects on the Group's financial position and financial performance. iv. For the information of the derivative financial instruments that the Group enters into, please refer to Note 6(2). (c) Management system: i. Risk management is executed by the Group’s finance department by following policies approved by the Board. Through cooperation with the Group's operating units, finance department is responsible for identifying, evaluating and hedging financial risks. ii. The Board has a written policy covering overall risk management. It also has written policies covering specific issues, such as exchange rate risk, interest rate risk, credit risk, derivative and non-derivative financial instruments used, and the investment of excess working capital. C. Significant financial risks and degrees of financial risks (a) Market risk i. Foreign exchange risk (i) Nature: The Group is a multinational group in the Electronic manufacturing services industry. Most of the exchange rate risk from operating activities comes from: a. The transaction dates of receivables and payables denominated in currencies other than functional currency are different, which results in exchange rate risk. Because the amount after the assets and liabilities are offset is insignificant, income/loss is insignificant as well. (Note: The Group has offices in many countries worldwide, so there are various currency exchange rate risks, but mainly from U.S. dollars and RMB.) b. Except for the above transactions (operating activities) recognized in the income statement, assets and liabilities recognized in the balance sheet and the net investment in foreign operations also result in the exchange rate risk. (ii) Management: a. For such risks, the Group has set up policies requiring companies in the Group to manage its exchange rate risks. b. As to the exchange rate risk arising from the difference between various functional currencies and the reporting currency in the consolidated financial statements, it is managed by the Group’s finance department. (iii) The source: a. U.S. dollar and NT dollar: Foreign exchange risk arises primarily from U.S. dollar-denominated cash, cash equivalents, accounts receivable and other receivables, other assets, loans,
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accounts payable and other payables and other liabilities, which results in exchange loss or gain when they ar e translated into New Taiwan dollars. b. U.S. dollars and RMB: Foreign exchange risk arises primarily from U.S. dollar-denominated cash, cash equivalents, accounts receivable and other receivables, other assets, loans, accounts payable and other payables and other liabilities, which results in exchange loss or gain when they are translated into RMB. c. JPY and NT dollar: Foreign exchange risk arises primarily from yen-denominated loans, accounts payable and other payables, which results in exchange loss or gain when they are translated into New Taiwan dollars. (iv) Extent The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows: December 31, 2013 Foreign Sensitivity analysis currency Effect (Foreign currency: amount Exchange Book value Extent of on profit Functional currency) (in thousands) rate (NTD) variation or loss Financial assets Monetary items USD : NTD$ 19,384,532 29.81 $ 577,852,899 1%$ 5,778,529 USD : RMB 12,925,509 29.81 385,309,423 1% 3,853,094 Net effect in consolidated entities with foreign currency USD : NTD$ 22,197,067 29.81 $ 661,694,567 Financial liabilities Monetary items USD : NTD$ 16,390,668 29.81 $ 488,605,813 1%$ 4,886,058 USD : RMB 20,869,632 29.81 622,123,730 1% 6,221,237 JPY : NTD 57,327,987 0.2839 16,275,416 1% 162,754
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December 31, 2012 Foreign Sensitivity analysis currency Effect (Foreign currency: amount Exchange Book value Extent of on profit Functional currency) (in thousands) rate (NTD) variation or loss Financial assets Monetary items USD : NTD$ 16,638,351 29.04 $ 483,177,713 1%$ 4,831,777 USD : RMB 8,337,943 29.04 242,133,865 1% 2,421,339 Net effect in consolidated entities with foreign currency USD : NTD$ 19,012,423 29.04 $ 552,120,764 Financial liabilities Monetary items USD : NTD$ 12,226,807 29.04 $ 355,066,475 1%$ 3,550,665 USD : RMB 16,937,054 29.04 491,852,048 1% 4,918,520 JPY : NTD 64,256,794 0.3364 21,615,986 1% 216,160 January 1, 2012 Foreign Sensitivity analysis currency Effect (Foreign currency: amount Exchange Book value Extent of on profit Functional currency) (in thousands) rate (NTD) variation or loss Financial assets Monetary items USD : NTD$ 16,044,545 30.28 $ 485,828,823 1%$ 4,858,288 USD : RMB 4,118,073 30.28 124,695,250 1% 1,246,953 Net effect in consolidated entities with foreign currency USD : NTD$ 16,132,709 30.28 $ 488,498,429 Financial liabilities Monetary items USD : NTD$ 11,235,440 30.28 $ 340,209,123 1%$ 3,402,091 USD : RMB 11,775,142 30.28 356,551,300 1% 3,565,513 JPY : NTD 74,763,422 0.3906 29,202,593 1% 292,026
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ii. Equity securities (i) Nature The Group primarily invests in domestic and foreign publicly traded and unlisted equity instruments, which are accounted for as available-for-sale financial assets and financial assets carried at cost. The price of those equity instruments will be affected by the uncertainty of the future value of the investment. (ii) Extent If such equity instruments’ price rise or fall by 1%, with all other factors held constant, the impact on equity due to available-for-sale equity instruments are $129,419 and $132,761 for the years ended December 31, 2013 and 2012, respectively. iii. Futures (i) Nature The Group is exposed to commodity price risk because of future commodity price fluctuations. (ii) Extent The Group sets stop-loss amount to reduce its futures market risk whenever futures contracts are entered into. As a result, there is no significant futures market risk. iv. Interest rate risk The Group's interest rate risk arises from long-term loans or corporate bonds with floating rates. The Company's long-term corporate bonds with fixed interest rates do not have interest rate risk or fair value interest rate risk. Long-term loans or corporate bonds with floating rates expose the Group to cash flow interest rate risk, but most of the risks are offset by cash and cash equivalents with variable interest rates. (b) Credit risk i. Credit risk refers to the risk of financial loss to the Group arising from default by the clients or counterparties of financial instruments. ii. According to the Group’s credit policy, each local entity in the Group is responsible for managing and analysing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. The Group assesses the credit quality of the customers by taking into account their financial position, past experience and other factors to conduct its internal risk management. iii. Individual risk limits are set based on internal or external ratings in accordance with limits set by the board of directors. The utilisation of credit limits is regularly monitored. Major credit risk arises from cash and cash equivalents, derivative financial instruments and other financial instruments. The counterparties are banks with good credit quality and financial institutions with investment grade or above and government agencies, so there is no significant compliance concerns and credit risk.
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iv. The aging analysis of notes receivable and accounts receivable (including related parties) that were past due but not impaired is as follows: December 31, 2013 December 31, 2012 January 1, 2012 Up to 30 days$ 8,224,520 $ 11,871,972 $ 5,243,072 31 to 90 days 3,145,815 2,059,013 3,745,660 91 to 180 days 1,086,131 1,376,003 978,407 181 to 360 days 506,697 655,966 217,896 Over 360 days 49,915 43,275 15,458 $ 13,013,078 $ 16,006,229 $ 10,200,493 v. Movements on the Group’s provision for impairment of notes receivable and accounts receivable (including related parties) are as follows: (i) As of December 31, 2013, December 31, 2012, and January 1, 2012, accounts receivable that had been impaired were $2,451,701, $2,224,178 and $1,835,555, respectively. (ii) Movement in allowance for individual provision for bad debts is as follows: 2013 2012 At January 1$ 2,224,178 $ 1,835,555 Reversal of impairment - - Provision for impairment 227,523 388,623 Write-offs during the year - - At December 31 $ 2,451,701 $ 2,224,178 vi. The credit quality of accounts receivable (including related parties) that were neither past due nor impaired is in the following categories based on the Group’s Credit Quality Control Policy: December 31, 2013 December 31, 2012 January 1, 2012 Group 1$ 527,536,494 $ 529,831,699 $ 379,988,390 Group 2 97,519,461 67,211,490 56,527,871 Group 3 89,230,431 9,377,496 16,808,896 Group 4 20,410,336 10,621,727 12,524,145 $ 734,696,722 $ 617,042,412 $ 465,849,302
Group 1: Standard Poor’s, Fitch’s, or Moody’s rating of A-level, or rated as A-level in accordance with the Group’s credit polices for those that have no external credit ratings. Group 2: Standard Poor’s or Fitch’s rating of BBB, Moody’s rating of Baa, or rated as B or C in accordance with the Group’s credit polices for those that have no external credit ratings. Group 3: Standard Poor’s or Fitch’s rating of BB + and below, or Moody’s rating of Ba1 and below. Group 4: Rated as other than A, B, or C in accordance with the Group’s credit polices for those that have no external credit ratings. (c) Liquidity risk 183 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 i. Cash flow forecasting is performed by each operating entity of the Group and aggregated by Group treasury. The Group treasury monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecasting takes into consideration the Group’s debt financing plans, covenant compliance, compliance with internal balance sheet ratio targets and, if applicable external regulatory or legal requirements, for example, currency restrictions. ii. The table below analyses the Group’s non-derivative financial liabilities and net-settled or gross-settled derivative financial liabilities into relevant maturity groups based on the remaining period at the balance sheet date to the contractual maturity date for non-derivative financial liabilities and to the expected maturity date for derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows.
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Non-derivative financial liabilities:
Between Less than Between 3 6 months Between 1 Between 2 Over December 31, 2013 3 months to 6 months to 1 year to 2 years to 5 years 5 years Total Short-term loans$ 361,513,330 $ 2,808,740 $ 1,911,531 $ - $ - $ - $ 366,233,601 Short-term notes and bills 19,982,517 - - - - - 19,982,517 payable Accounts payable 689,391,137 23,131,099 181,912 - - - 712,704,148 (including related parties) Other payables 184,355,029 6,310,344 509,805 - - - 191,175,178 Bonds payable - - 6,410,000 16,500,000 73,441,230 7,200,000 103,551,230 Long-term loans 2,606,300 - 5,209,588 12,502,486 20,708,040 1,898,202 42,924,616 $ 1,257,848,313 $ 32,250,183 $ 14,222,836 $ 29,002,486 $ 94,149,270 $ 9,098,202 $ 1,436,571,290 Between Less than Between 3 6 months Between 1 Between 2 Over December 31, 2012 3 months to 6 months to 1 year to 2 years to 5 years 5 years Total Short-term loans$ 235,210,202 $ 9,854,348 $ 52,507,615 $ - $ - $ - $ 297,572,165 Short-term notes and bills 7,991,597 - - - - - 7,991,597 payable Accounts payable 608,031,560 25,128,687 5,210,394 - - - 638,370,641 (including related parties) Other payables 179,783,390 6,193,703 10,290,461 - - - 196,267,554 Bonds payable - - 32,450,000 3,410,000 67,626,000 4,050,000 107,536,000 Long-term loans - - 18,295,200 19,156,400 10,788,557 763,000 49,003,157 $ 1,031,016,749 $ 41,176,738 $ 118,753,670 $ 22,566,400 $ 78,414,557 $ 4,813,000 $ 1,296,741,114
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Between Less than Between 3 6 months Between 1 Between 2 Over January 1, 2012 3 months to 6 months to 1 year to 2 years to 5 years 5 years Total Short-term loans$ 228,321,249 $ 25,108,038 $ 7,093,462 $ - $ - $ - $ 260,522,749 Short-term notes and bills 7,989,312 - - - - - 7,989,312 payable Accounts payable 518,607,491 23,517,715 6,369,073 - - - 548,494,279 (including related parties) Other payables 107,432,146 6,985,954 8,727,754 - - - 123,145,854 Bonds payable - - 3,000,000 33,690,000 25,860,000 4,050,000 66,600,000 Long-term loans - - - 25,889,400 27,601,700 109,000 53,600,100 $ 862,350,198 $ 55,611,707 $ 25,190,289 $ 59,579,400 $ 53,461,700 $ 4,159,000 $ 1,060,352,294 Derivative financial liabilities: Between Less than Between 3 6 months Between 1 Between 2 Over December 31, 2013 3 months to 6 months to 1 year to 2 years to 5 years 5 years Total Forward exchange contracts$ 39,946 $ - $ - $ - $ - $ - $ 39,946
December 31, 2012 Forward exchange contracts$ 66,767 $ - $ - $ - $ - $ - $ 66,767 Euro-Convertible Bond - - 15,288 - - - 15,288 conversion rights
January 1, 2012 Forward exchange contracts$ 162,960 $ 15,301 $ 73,573 $ - $ - $ - $ 251,834 Euro-Convertible Bond - - - 470,158 - - 470,158
conversion rights
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(3) Fair value estimation The table below analyses the valuation technique used to value the financial instruments measured at fair value. The different levels have been defined as follows: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities. These instruments held by the Group are mainly equity instruments, the fair value of which is based on the quoted prices from the Stock Exchange, OTC market or regulatory agency’s market actual data. They are classified as “financial assets and liabilities at fair value through profit or loss” or “available-for-sale financial assets”. Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices). These instruments held by the Group are financial instruments that do not have level 1 quoted prices, such as derivative instruments or forward exchange contracts. The fair value is mainly determined by valuation techniques or the use of counterparties’ quote information. The valuation techniques maxmize the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2. These financial instruments are classified as “financial assets and liabilities at fair value through profit or loss”. Level 3: Inputs for the asset or liability that are not based on observable market data. The following table presents the Group’s financial assets and liabilities that are measured at fair value at December 31, 2013, December 31, 2012, and January 1, 2012. December 31, 2013 Level 1 Level 2 Level 3 Total Financial assets: Financial assets at fair value through profit or loss Forward exchange contracts$ - $ 451,973 $ - $ 451,973 Open-end funds 430,040 - - 430,040 Cross currency swap contracts - 316,099 - 316,099 Available-for-sale financial assets Equity securities 12,941,855 - - 12,941,855 Total $ 13,371,895 $ 768,072 $ - $ 14,139,967 Financial liabilities: Financial liabilities at fair value through profit or loss $ - ($ 39,946) $ - ($ 39,946) Forward exchange contracts
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December 31, 2012 Level 1 Level 2 Level 3 Total Financial assets: Financial assets at fair value through profit or loss Forward exchange contracts$ - $ 56,955 $ - $ 56,955 Open-end funds 83,265 - - 83,265 Convertible bonds - 179,300 - 179,300 Available-for-sale financial assets Equity securities 13,276,127 - - 13,276,127 Total $ 13,359,392 $ 236,255 $ - $ 13,595,647 Financial liabilities: Financial liabilities at fair value through profit or loss Forward exchange contracts$ - $ 66,767 $ - $ 66,767 Euro-Convertible Bond conversion rights - 15,288 - 15,288 $ - $ 82,055 $ - $ 82,055 Total January 1, 2012 Level 1 Level 2 Level 3 Total Financial assets: Financial assets at fair value through profit or loss Forward exchange contracts$ - $ 45,917 $ - $ 45,917 Open-end funds 24,412 - - 24,412 Available-for-sale financial assets Equity securities 10,039,798 - - 10,039,798 Total $ 10,064,210 $ 45,917 $ - $ 10,110,127 Financial liabilities: Financial liabilities at fair value through profit or loss Forward exchange contracts$ - $ 251,834 $ - $ 251,834 Euro-Convertible Bond conversion rights - 470,158 - 470,158 Total $ - $ 721,992 $ - $ 721,992 10.
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13. ADDITIONAL DISCLOSURES REQUIRED BY THE SECURITIES AND FUTURES COMMISSION (1) Related information of significant transactions (All the transactions with subsidiaries disclosed below had been eliminated when preparing consolidated financial statements. The disclosure information as follows is for reference only.) A. Loans to others:
Maximum Amount of Limit on Collateral General Is a outstanding balance Actual transactions Reason for Allowance loans Ceiling on ledger related during the year Balance at amount drawn Interest Nature of with the short-term for doubtful granted to a total loans No. Creditor Borrower account party ended 12/31/2013 12/31/2013 down Rate (%) loan borrower financing accounts Item Value single party granted Note 0 Hon Hai Precision Ambit Other Y$ 3,000,000 $ 3,000,000 $ 3,000,000 1.00 Short $ - Business $ - None -$ $ - $ - Note 1 Industry Co., Ltd. Microsystems Receivables- term operation Corporation financing financing 1 Hon Yuan Hon Hai Precision Other Y 293,000 293,000 - N/A Short - Business - None - - - Note 2 International Industry Co., Ltd. Receivables- term operation Investment Co., financing financing Ltd. 2 Hon Chi Ambit Other Y 200,000 200,000 200,000 1.00 Short - Business - None - - - Note 2 International Microsystems Receivables- term operation Investment Co., Corporation financing financing Ltd. 2 Hon Chi UER Technology Other Y 200,000 - - N/A Short - Business - None - - - Note 2 International Corporation Receivables- term operation Investment Co., financing financing Ltd. 2 Hon Chi Hon Hai Precision Other Y 265,000 265,000 - N/A Short - Business - None - - - Note 2 International Industry Co., Ltd. Receivables- term operation Investment Co., financing financing Ltd. 3 Bon Shin SetaBox Other Y 230,000 230,000 230,000 N/A Short - Business 208,312 None - - - Note 2 International Technology Co., Receivables- term operation Investment Co., Ltd. financing financing Ltd. 3 Bon Shin Hon Hai Precision Other Y 450,000 450,000 - N/A Short - Business - None - - - Note 2 International Industry Co., Ltd. Receivables- term operation Investment Co., financing financing Ltd. 4 Lin Yih Hon Hai Precision Other Y 97,000 97,000 - N/A Short - Business - None - - - Note 2 International Industry Co., Ltd. Receivables- term operation Investment Co., financing financing Ltd.
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Maximum Amount of Limit on Collateral General Is a outstanding balance Actual transactions Reason for Allowance loans Ceiling on ledger related during the year Balance at amount drawn Interest Nature of with the short-term for doubtful granted to a total loans No. Creditor Borrower account party ended 12/31/2013 12/31/2013 down Rate (%) loan borrower financing accounts Item Value single party granted Note
5 Hyield Venture Ambit Other Y$ 800,000 $ 800,000 $ 800,000 1.00 Short $ - Business $ - None -$ $ - $ - Note 2 Capital Co., Ltd. Microsystems Receivables- term operation Corporation financing financing 5 Hyield Venture Hon Hai Precision Other Y 1,000,000 1,000,000 - N/A Short - Business - None - - - Note 2 Capital Co., Ltd. Industry Co., Ltd. Receivables- term operation financing financing 6 Hongfujin Fu Xun Tong Entrusted Y 333,585 - - N/A Short - Business - None - - - Note 3 Precision Trading Loans term operation Industrial (Shenzhen) Co., financing (Shenzhen) Co., Ltd. Ltd. 7 Futaihua Industrial Foxconn Precision Entrusted Y 4,248,450 - - N/A Short - Business - None - - - Note 3 (Shenzhen) Co., Electronics Loans term operation Ltd. (Taiyuan) Co., financing Ltd. 7 Futaihua Industrial Futaikang Entrusted Y 48,064 - - N/A Short - Business - None - - - Note 3 (Shenzhen) Co., Precision Loans term operation Ltd. Component financing (Shenzhen) Co., Ltd. 7 Futaihua Industrial Fuhonyang Entrusted Y 4,191,809 4,191,809 4,191,809 3~3.25 Short - Business - None - - - Note 3 (Shenzhen) Co., Precision Loans term operation Ltd. Industrial financing (Shenzhen) Co., Ltd. 7 Futaihua Industrial Fujin Precision Entrusted Y 4,902,700 4,902,700 4,902,700 3.25 Short - Business - None - - - Note 3 (Shenzhen) Co., Industrial Loans term operation Ltd. (Jincheng) Co., financing Ltd. 8 Anpinda Precision Jizhun Precision Entrusted Y 2,613,400 1,519,837 1,519,837 3.05 Short - Business - None - - - Note 3 Industrial Industry (Huizhou) Loans term operation (Huizhou) Co., Co., Ltd. financing Ltd.
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Maximum Amount of Limit on Collateral General Is a outstanding balance Actual transactions Reason for Allowance loans Ceiling on ledger related during the year Balance at amount drawn Interest Nature of with the short-term for doubtful granted to a total loans No. Creditor Borrower account party ended 12/31/2013 12/31/2013 down Rate (%) loan borrower financing accounts Item Value single party granted Note
9 Foxconn Fuding Precision Entrusted Y$ 1,470,810 $ 1,470,810 $ 1,470,810 2.6 Short $ - Business $ - None -$ $ - $ - Note 3 (Kunshan) Industrial Loans term operation Computer (Zhengzhou) Co., financing Connector Co., Ltd. Ltd. 9 Foxconn Fuxian Precision Entrusted Y 1,211,900 - - N/A Short - Business - None - - - Note 3 (Kunshan) Industry Loans term operation Computer (Kunshan) Co., financing Connector Co., Ltd. Ltd. 9 Foxconn Foxconn Entrusted Y 3,588,776 3,588,776 3,588,776 1.82~ Short - Business - None - - - Note 3 (Kunshan) Electronic Loans 2.6 term operation Computer Industrial financing Connector Co., Development Ltd. (Kunshan) Co., Ltd. 10 Hongzhun Qunkang Precision Entrusted Y 344,180 - - N/A Short - Business - None - - - Note 3 Precision Tooling Component Loans term operation (Kunshan) Co., (Kunshan) Co., financing Ltd. Ltd.
10 Hongzhun Foxconn Entrusted Y 1,454,280 - - N/A Short - Business - None - - - Note 3 Precision Tooling Electronic Loans term operation (Kunshan) Co., Industrial financing Ltd. Development (Kunshan) Co., Ltd. 10 Hongzhun Kangzhun Entrusted Y 1,616,307 - - N/A Short - Business - None - - - Note 3 Precision Tooling Precision Tooling Loans term operation (Kunshan) Co., (Kunshan) Co., financing Ltd. Ltd.
10 Hongzhun Fuxian Precision Entrusted Y 1,224,475 - - N/A Short - Business - None - - - Note 3 Precision Tooling Industry Loans term operation (Kunshan) Co., (Kunshan) Co., financing Ltd. Ltd.
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Maximum Amount of Limit on Collateral General Is a outstanding balance Actual transactions Reason for Allowance loans Ceiling on ledger related during the year Balance at amount drawn Interest Nature of with the short-term for doubtful granted to a total loans No. Creditor Borrower account party ended 12/31/2013 12/31/2013 down Rate (%) loan borrower financing accounts Item Value single party granted Note
10 Hongzhun Hongfujin Entrusted Y$ 2,696,485 $ 2,696,485 $ 2,696,485 1.82 Short $ - Business $ - None -$ $ - $ - Note 3 Precision Tooling Precision Loans term operation (Kunshan) Co., Electronics financing Ltd. (Chengdu) Co., Ltd. 11 Ambit Kangzhun Entrusted Y 1,531,842 - - N/A Short - Business - None - - - Note 3 Microsystems Precision Tooling Loans term operation (Shanghai) Co., (Kunshan) Co., financing Ltd. Ltd. 11 Ambit Shanghai Foxconn Entrusted Y 661,217 539,297 539,297 2.85 Short - Business - None - - - Note 3 Microsystems Co., Ltd. Loans term operation (Shanghai) Co., financing Ltd. 12 Fuyang Fuxian Precision Entrusted Y 1,121,619 - - N/A Short - Business - None - - - Note 3 Electronical Industry Loans term operation Technology (Kunshan) Co., financing (Changshu) Co., Ltd. Ltd. 12 Fuyang Foxconn Entrusted Y 1,667,574 - - N/A Short - Business - None - - - Note 3 Electronical Electronic Loans term operation Technology Industrial financing (Changshu) Co., Development Ltd. (Kunshan) Co., Ltd. 12 Fuyang Kangzhun Entrusted Y 490,270 490,270 490,270 1.82 Short - Business - None - - - Note 3 Electronical Precision Tooling Loans term operation Technology (Kunshan) Co., financing (Changshu) Co., Ltd. Ltd. 12 Fuyang Hongfujin Entrusted Y 1,671,821 1,671,821 1,671,821 1.82 Short - Business - None - - - Note 3 Electronical Precision Loans term operation Technology Electronics financing (Changshu) Co., (Chengdu) Co., Ltd. Ltd.
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Maximum Amount of Limit on Collateral General Is a outstanding balance Actual transactions Reason for Allowance loans Ceiling on ledger related during the year Balance at amount drawn Interest Nature of with the short-term for doubtful granted to a total loans No. Creditor Borrower account party ended 12/31/2013 12/31/2013 down Rate (%) loan borrower financing accounts Item Value single party granted Note
13 Fuyu Energy Foxconn Entrusted Y$ 654,426 $ - $ - N/A Short $ - Business $ - None -$ $ - $ - Note 3 Technology Electronic Loans term operation (Kunshan) Co., Industrial financing Ltd. Development (Kunshan) Co., Ltd. 13 Fuyu Energy Fuxian Precision Entrusted Y 661,217 - - N/A Short - Business - None - - - Note 3 Technology Industry Loans term operation (Kunshan) Co., (Kunshan) Co., financing Ltd. Ltd. 14 Foxway Precision Kangzhun Entrusted Y 489,790 - - N/A Short - Business - None - - - Note 3 Industry Precision Tooling Loans term operation (Hangzhou) Co., (Kunshan) Co., financing Ltd. Ltd. 15 Fu Zhun Precision Fu Yu Electronical Entrusted Y 1,013,865 - - N/A Short - Business - None - - - Note 3 Tooling (Huai an) Technology Loans term operation Co., Ltd. (Huaian) Co., Ltd. financing 16 Shanghai Peng Shanghai Ketai Entrusted Y 156,886 156,886 156,886 2.85 Short - Business - None - - - Note 3 Zhan Investment Huajie Investment Loans term operation Co., Ltd. Co., Ltd. financing 17 Fu Tai Kang Foxconn Precision Entrusted Y 1,020,348 882,486 882,486 1.35 Short - Business - None - - - Note 3 Electronics Electronics Loans term operation Development (Yantai) Co., Ltd. financing (YanTai) Ltd. 18 Hongfujin Foxconn Precision Entrusted Y 2,427,300 - - N/A Short - Business - None - - - Note 3 Precision Electronics Loans term operation Electrons (Yantai) (Taiyuan) Co., financing Co., Ltd. Ltd. 18 Hongfujin Foxconn Precision Entrusted Y 2,593,870 2,348,563 2,348,563 0.17~ Short - Business - None - - - Note 3 Precision Electronics Loans 0.69 term operation Electrons (Yantai) (Yantai) Co., Ltd. financing Co., Ltd.
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Maximum Amount of Limit on Collateral General Is a outstanding balance Actual transactions Reason for Allowance loans Ceiling on ledger related during the year Balance at amount drawn Interest Nature of with the short-term for doubtful granted to a total loans No. Creditor Borrower account party ended 12/31/2013 12/31/2013 down Rate (%) loan borrower financing accounts Item Value single party granted Note
19 Hongfujin Zhengzhou Entrusted Y$ 1,456,380 $ 490,270 $ 490,270 2.60 Short $ - Business $ - None -$ $ - $ - Note 3 Precision Wanma Loans term operation Electronics Electronics financing (Zhengzhou) Co., Technology Co., Ltd. Ltd. 19 Hongfujin Futaihua Precision Entrusted Y 7,944,680 7,944,680 7,944,680 0.31~ Short - Business - None - - - Note 3 Precision Electronics Loans 2.6 term operation Electronics (Jiyuan) Limited financing (Zhengzhou) Co., Ltd. 19 Hongfujin Foxconn Precision Entrusted Y 1,180,125 - - N/A Short - Business - None - - - Note 3 Precision Electronics Loans term operation Electronics (Taiyuan) Co., financing (Zhengzhou) Co., Ltd. Ltd. 19 Hongfujin Fuding Precision Entrusted Y 2,449,110 490,270 490,270 2.60 Short - Business - None - - - Note 3 Precision Industrial Loans term operation Electronics (Zhengzhou) Co., financing (Zhengzhou) Co., Ltd. Ltd. 20 Erdos HongHan Futaihua Precision Entrusted Y 970,735 970,735 970,735 2.60 Short - Business - None - - - Note 3 Precision Electronics Loans term operation Electronics (Zhengzhou) Co., financing Limited Ltd. 21 Hongfujin ChongQing Entrusted Y 26,210 - - N/A Short - Business - None - - - Note 3 Precision HongFuZhun Loans term operation Electronics Trading Co., Ltd. financing (Chongqing) Co., Ltd. 22 Hongfujin ChengDu Entrusted Y 205,913 205,913 205,913 1.35 Short - Business - None - - - Note 3 Precision XunFeng Trading Loans term operation Electronics Co., Ltd. financing (Chengdu) Co., Ltd.
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Maximum Amount of Limit on Collateral General Is a outstanding balance Actual transactions Reason for Allowance loans Ceiling on ledger related during the year Balance at amount drawn Interest Nature of with the short-term for doubtful granted to a total loans No. Creditor Borrower account party ended 12/31/2013 12/31/2013 down Rate (%) loan borrower financing accounts Item Value single party granted Note
23 Foxconn Fujin Precision Other Y$ 5,016,700 $ - $ - N/A Short $ - Business $ - None -$ $ - $ - Note 3 (Far East) Industrial Receivables- term operation Limited (Jincheng) Co., financing financing Ltd. 23 Foxconn Fu Yu Electronical Other Y 96,216 86,488 86,488 1.28 Short - Business - None - - - Note 3 (Far East) Technology Receivables- term operation Limited (Huaian) Co., Ltd. financing financing 23 Foxconn Foxconn Other Y 404,649 403,893 403,893 - Short - Business - None - - - Note 3 (Far East) Interconnect Receivables- term operation Limited Technology financing financing Limited 23 Foxconn Hongfujin Other Y 2,905,801 2,612,008 2,612,008 1.28 Short - Business - None - - - Note 3 (Far East) Precision Receivables- term operation Limited Electronics financing financing (Chengdu) Co., Ltd. 23 Foxconn Fu Ding Other Y 2,844,445 2,844,445 2,844,445 1.24835~1 Short - Business - None - - - Note 3 (Far East) Electronical Receivables- .28 term operation Limited Technology financing financing (Jiashan) Co., Ltd. 23 Foxconn Competition Team Other Y 3,000,000 2,991,800 2,991,800 - Short - Business - None - - - Note 3 (Far East) Ireland Limited Receivables- term operation Limited financing financing 23 Foxconn Kangzhun Other Y 3,265,890 3,265,890 3,265,890 0.17~ Short - Business - None - - - Note 3 (Far East) Precision Tooling Receivables- 2.60664 term operation Limited (Kunshan) Co., financing financing Ltd. 23 Foxconn Fuxian Precision Other Y 4,916,762 4,916,762 4,916,762 0.17~ Short - Business - None - - - Note 3 (Far East) Industry Receivables- 2.48815 term operation Limited (Kunshan) Co., financing financing Ltd. 24 Foxconn Foxconn TR Other Y 300,000 - - N/A Short - Business - None - - - Note 3 CZ S.R.O Teknoloji Sanayi Receivables- term operation Limited Sirketi financing financing
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Maximum Amount of Limit on Collateral General Is a outstanding balance Actual transactions Reason for Allowance loans Ceiling on ledger related during the year Balance at amount drawn Interest Nature of with the short-term for doubtful granted to a total loans No. Creditor Borrower account party ended 12/31/2013 12/31/2013 down Rate (%) loan borrower financing accounts Item Value single party granted Note
25 Shenzhen Fu Tai FIH (Tian Jin) Entrusted Y$ 3,235,782 $ 3,235,782 $ 3,235,782 3.00 Short $ - Business $ - None -$ $ - $ - Note 4 Hong Precision Precision Industry Loans term operation Industry Co., Ltd. Co., Ltd. financing 25 Shenzhen Fu Tai Foxconn Precision Entrusted Y 5,392,970 5,392,970 5,392,970 3.00 Short - Business - None - - - Note 4 Hong Precision Electronics Loans term operation Industry Co., Ltd. (Langfang) Co., financing Ltd. 26 Foxconn Precision Futaijing Precision Entrusted Y 7,516,320 - - N/A Short - Business - None - - - Note 4 Component Electronics Loans term operation (Beijing) Co., Ltd. (Beijing) Co., Ltd. financing 26 Foxconn Precision FIH (Tian Jin) Entrusted Y 1,457,640 980,540 980,540 3.00 Short - Business - None - - - Note 4 Component Precision Industry Loans term operation (Beijing) Co., Ltd. Co., Ltd. financing 26 Foxconn Precision Foxconn Precision Entrusted Y 3,677,025 3,677,025 3,677,025 3.00 Short - Business - None - - - Note 4 Component Electronics Loans term operation (Beijing) Co., Ltd. (Langfang) Co., financing Ltd. 27 Execustar Foxconn Precision Other Y 510,000 - - N/A Short - Business - None - - - Note 4 International Electronics Receivables- term operation Limited (Langfang) Co., financing financing Ltd. 28 FIH Mobile FIH (Tian Jin) Other Y 3,109,600 - - N/A Short - Business - None - - - Note 4 Limited Precision Industry Receivables- term operation Co., Ltd. financing financing 28 FIH Mobile Foxconn Precision Other Y 3,960,000 - - N/A Short - Business - None - - - Note 4 Limited Electronics Receivables- term operation (Langfang) Co., financing financing Ltd. Note 1: The ceiling on total loans granted by the Company to all parties is 40% of its net assets value; the ceiling on single loan granted by the Company to all parties is 10% of its net assets value. Note 2: The ceiling on total loans granted by a domestic subsidiary to all parties is 40% of its net assets value; the ceiling on single loan granted by a domestic subsidiary to all parties is 10% of its net assets value. Note 3: The policy for loans granted mutually between overseas subsidiaries of which the Company directly or indirectly holds 100% of their voting shares is as follows: ceiling on total loans granted by an overseas subsidiary to all overseas subsidiaries is 20% of the Company’s net assets; limit on loans granted by an overseas subsidiary to a single overseas subsidiary is 10% of the Company’s net assets. Note 4: The policy for loans granted by overseas subsidiaries of which FIH Mobile Limited (Formerly Foxconn International Holdings Limited) directly or indirectly holds 100% of their voting shares is as follows: ceiling on total loans granted by an overseas subsidiary to all parties is 60% of the net assets of FIH Mobile Limited (Formerly Foxconn International Holdings Limited); limit on loans granted by an overseas subsidiary to a single party is 30% of the net assets value of FIH Mobile Limited (Formerly Foxconn International Holdings Limited).
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B. Provision of endorsements and guarantees to others: Party being endorsed / guaranteed Maximum Ratio of outstanding Outstanding accumulated Ceiling on Provision of Provision of Provision of Limit on endorsements / endorsements / Amount of endorsements / total amount endorsements endorsements endorsements Relationship endorsements guarantee guarantee endorsements guarantee amount to of / guarantees /guarantees / guarantees with the / guarantees amount as of amount at / guarantee net asset value of the endorsements by parent by subsidiary to the party in Endorser/ endorser / provided for a December 31, December 31, Actual amount secured with endorser / guarantor / guarantee company to to parent Mainland No. guarantor Company name guarantor single party 2013 2013 drawn down collateral company provided subsidiary company China Note 0 Hon Hai Precision Competition Team Note 2 $ - $ 7,217,629 $ 7,217,629 $ 1,498,892 $ - 1 $ - Y N N Note Industry Co., Ltd. Ireland Limited 5、9
0 Hon Hai Precision Falcon Precision Note 2 - 9,805,400 9,805,400 - - 1 - Y N N Note Industry Co., Ltd. Trading Limited 5、9
0 Hon Hai Precision Competition Team Note 2 - 30,748,000 30,748,000 25,430,300 - 4 - Y N N Note Industry Co., Ltd. Technologies 5、9 Limited 0 Hon Hai Precision Foxconn (Far East) Note 2 - 65,340,000 48,704,100 18,942,000 - 7 - Y N N Note Industry Co., Ltd. Limited 5、9
0 Hon Hai Precision Hongfujin Note 2 - 5,046,100 4,386,056 4,386,056 - 1.00 - Y N N Note Industry Co., Ltd. Precision 5、9 Electronics (Chengdu) Co., Ltd. 0 Hon Hai Precision Foxconn Slovakia, Note 2 - 15,733,991 13,204,110 10,478,428 - 2 - Y N Y Note Industry Co., Ltd. SPOL. S R. O. 5、9
1 Hong Fujin Fu Ding Precision Note 3 - 14,297 - - - - - N N Y Note Precision Industrial Component 6、7、 (Shenzhen) Co., (Shenzhen) Co., 9 Ltd. Ltd. 1 Hong Fujin Futaihua Industrial Note 3 - 21,797 - - - - - N N Y Note Precision Industrial (Shenzhen) Co., 6、7、 (Shenzhen) Co., Ltd. 9 Ltd.
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Party being endorsed / guaranteed Maximum Ratio of outstanding Outstanding accumulated Ceiling on Provision of Provision of Provision of Limit on endorsements / endorsements / Amount of endorsements / total amount endorsements endorsements endorsements Relationship endorsements guarantee guarantee endorsements guarantee amount to of / guarantees /guarantees / guarantees with the / guarantees amount as of amount at / guarantee net asset value of the endorsements by parent by subsidiary to the party in Endorser/ endorser / provided for a December 31, December 31, Actual amount secured with endorser / guarantor / guarantee company to to parent Mainland No. guarantor Company name guarantor single party 2013 2013 drawn down collateral company provided subsidiary company China Note
1 Hong Fujin Fuhuajie Industrial Note 3 $ - $ 2,202,431 $ - $ - $ - - $ - N N Y Note Precision Industrial (Shenzhen) 6、7、 (Shenzhen) Co., Limited 9 Ltd.
2 Ennoconn NanJing Asiatek Note 4 - 30,000 26,482 5,787 26,933 - - Y N Y Note Corporation Inc. 8、9
Note 1: The Company holds more than 50% of common shares of the subsidiary. Note 2: The Company and its subsidiaries hold more than 50% of common shares of the investee company. Note 3: The Company and its subsidiaries hold more than 50% of common shares of the overseas subsidiary. Note 4: The Company’s indirect wholly-owned subsidiary and its subsidiary. Note 5: The total endorsements and guarantees of the Company to others should not be in excess of the Company’s net assets, and for a single party should not be in excess of 50% of the Company’s net assets. Note 6: The total endorsements and guarantees of the Company and its subsidiaries to others should not be in excess of the Company’s net assets, and for a single party should not be in excess of 50% of the Company’s net assets. Note 7: The policy for loans granted mutually between overseas subsidiaries of which the Company directly or indirectly holds 100% of their voting shares is as follows: ceiling on total loans granted by an overseas subsidiary to all overseas subsidiaries is 50% of the Company’s net assets; limit on loans granted by an overseas subsidiary to a single overseas subsidiary is 20% of the Company’s net assets. Note 8: The policy for loans granted by subsidiaries of which Ennoconn Corporation directly or indirectly holds 100% of their voting shares is as follows: ceiling on total loans granted by a subsidiary to all parties is the net assets of Ennoconn Corporation; limit on loans granted by a subsidiary to a single party is 50% of the net assets value of Ennoconn Corporation. Note 9: The net assets referred to above are based on the latest audited financial statements.
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C. Holding of marketable securities as of December 31, 2013 (not including subsidiaries, associates and joint ventures): General ledger As of December 31, 2013 Relationship with the account Number Book value Ownership Fair Securities held by Marketable securities (Note 1) securities issuer (Note 2) of shares (Note 3) (% ) Value Note Hon Hai Precision Industry Co., Ltd. Common stock of Media Tek Inc. None (1) 2,134 $ 946,544 - $ 946,544 Hon Hai Precision Industry Co., Ltd. Common stock of Innolux Co., Ltd. The Company's chairman is the (1) 137,624 1,562,037 2 1,562,037 major shareholder Hon Hai Precision Industry Co., Ltd. Global Strategic Investment Inc. None (2) 3,400 68,136 13 68,136 Hon Hai Precision Industry Co., Ltd. Others (Note 3) None (2) - 90,862 - 90,862 Bon Shin International Investment Co., Ltd. Common stock of Entire Technology Co., Ltd. None (1) 2,100 65,520 1 65,520 Bon Shin International Investment Co., Ltd. Common stock of Simplo Technology Co., Ltd. None (1) 12,884 1,700,699 4 1,700,699 Bon Shin International Investment Co., Ltd. Common stock of UVAT Technology Co., Ltd. None (1) 7,558 48,748 16 48,748 Bon Shin International Investment Co., Ltd. Common stock of Bionet Corporation None (1) 1,732 81,231 3 81,231 Bon Shin International Investment Co., Ltd. Others (Note 3) None (1) - 42,411 - 42,411 Bon Shin International Investment Co., Ltd. Common stock of Waltop None (2) 660 9,900 2 9,900 Bon Shin International Investment Co., Ltd. Common stock of MiTAC Information Technology Co. None (2) 1,775 33,006 1 33,006 Bon Shin International Investment Co., Ltd. Common stock of MiTAC Inc. None (2) 2,730 39,252 1 75,453 Hon Chi International Investment Co.,Ltd. Common stock of Waltop None (2) 660 9,900 2 9,900 Hon Yuan International Investment Co.,Ltd. Common stock of Entire Technology Co., Ltd. None (1) 2,206 68,829 2 68,829 Hon Yuan International Investment Co.,Ltd. Common stock of Waltop None (2) 660 9,900 2 9,900 Lin Yih International Investment Co., Ltd. Common stock of AcBel Polytech Inc. None (1) 3,857 118,217 1 118,217 Lin Yih International Investment Co., Ltd. Common stock of Waltop None (2) 660 9,900 2 9,900 Hyield Venture Capital Co., Ltd. Common stock of TXC Corporation None (1) 466 16,828 - 16,828 Hyield Venture Capital Co., Ltd. Common stock of Unimicron Corporation None (1) 3,400 76,840 - 76,840 Hyield Venture Capital Co., Ltd. Common stock of Foxlink Image Technology Co., Ltd. None (1) 3,098 58,707 2 58,707 Hyield Venture Capital Co., Ltd. Common stock of Innolux Corporation The Company's chairman is the (1) 163,989 1,861,278 2 1,861,278 major shareholder Hyield Venture Capital Co., Ltd. Common stock of Microelectronics Technology Inc. None (1) 14,524 271,602 4 271,602 Hyield Venture Capital Co., Ltd. Common stock of Tai Tung Communication Co., Ltd. None (1) 4,000 166,600 5 166,600 Hyield Venture Capital Co., Ltd. Common stock of Simplo Technology Co., Ltd. None (1) 13,691 1,807,226 4 1,807,226 Hyield Venture Capital Co., Ltd. Common stock of Bionet Corporation None (1) 1,732 81,231 3 81,231 Hyield Venture Capital Co., Ltd. Common stock of Tera Xtal Technology Co., Ltd. None (1) 2,395 40,356 1 40,356 Hyield Venture Capital Co., Ltd. Others (Note 3) None (1)(3) - 491,858 - 491,858 Hyield Venture Capital Co., Ltd. Common stock of Waltop None (2) 660 9,900 2 9,900 Hyield Venture Capital Co., Ltd. Common stock of Deer Computer Co., Ltd. None (2) 435 4,467 15 4,467
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General ledger As of December 31, 2013 Relationship with the account Number Book value Owners hip Fair Securities held by Marketable securities (Note 1) securities issuer (Note 2) of shares (Note 3) (% ) Value Note
Foxconn (Far East) Limited Solytech Enterprise Corporation None (1) 6,430 $ 69,128 3 $ 69,128 Foxconn (Far East) Limited Olympus Corporation None (1) 1,743 1,643,906 1 1,643,906 Foxconn (Far East) Limited Shenzhen Yuto Printing Corporation None (2) 7,472 127,694 5 127,694 Foxconn (Far East) Limited Woodman Labs, Inc. None (2) 11,709 5,595,155 11 5,595,155 Foxconn (Far East) Limited Easpnet Inc. None (2) 6,439 19,859 18 19,859 Foxconn (Far East) Limited Wiriciti Corporation None (2) - 298,100 - 298,100 Foxconn (Far East) Limited MSDC Denali Investors, L.P. None (2) - 894,300 - 894,300 Foxconn (Far East) Limited Conquer Hill Advantage Fund None (2) - 298,100 - 298,100 Foxconn (Far East) Limited Others (Note 3) None (1)(2) - 380,844 - 380,844 Foxconn Holding Ltd. S.A.S. Dragon Holdings Ltd. None (1) 62,000 888,619 4 888,619 Foxconn Holding Ltd. P.I.E. Industrial Berhad None (1) 2,227 140,372 3 140,372 Foxconn Holding Ltd. Invensense Inc. None (1) 1,436 889,785 2 889,785 Foxconn Singapore Pte. Ltd. P.I.E. Industrial Berhad None (1) 10 630 - 630 Foxconn Holding Ltd. Dimondhead Ventures, L.P. None (2) - 324,309 - 324,309 Foxconn Holding Ltd. Riverwood Capital L.P. None (2) - 1,059,135 - 1,059,135 Foxconn Holding Ltd. Aptina Acquistion L.P. None (2) 5,000 157,636 - 157,636 Foxconn Holding Ltd. WIMM Labs Ltd. None (2) 8,500 275,787 - 275,787 Foxconn Holding Ltd. FUHU Inc. None (2) 1,776 298,100 - 298,100 Foxconn Holding Ltd. Innovation Works Limited None (2) 2,600 77,506 - 77,506 Foxconn Holding Ltd. Innovation Works Development Fund L.P. None (2) - 295,516 - 295,516 Foxconn Holding Ltd. Translink Capital None (2) - 205,130 - 205,130 Foxconn Holding Ltd. Firebrand Wireless LLC None (2) - 83,892 - 83,892 Foxconn Holding Ltd. Others (Note 3) None (2) - 285,176 - 285,176
Note 1: Marketable securities in the table refer to stocks, bonds, beneficiary certificates and other related derivative securities within the scope of IAS 39 ‘Financial instruments : recognition and measurement’. Note 2: Code of general ledger accounts: (1) Available-for-sale financial assets (2) Financial assets carried at cost (3) Financial assets at fair value through profit or loss Note 3: Due to the amount is insignificant, combined disclosure is adopted.
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D. Aggregate purchases or sales of the same securities reaching $300 million or 20% of paid-in capital or more: General Relationship Balance as at January 1, 2013 Addition Disposal Balance as at December 31, 2013 Marketable ledger with the Number of Number of Number Selling Gain (loss) Number of Investor securities account Counterparty investor shares Amount shares Amount of shares price Book value on disposal shares Amount Hon Hai Precision Foxconn (Far Note Capital Note 3 3,382,945 USD 680,200 USD 680,200 - $ - $ - $ - 4,063,145 USD 4,063,145 Industry Co., Ltd. East) Limited 1(1) Increase by 3,382,945 (in thousands) (in thousands) Cash (in thousands) Hon Hai Precision Ambit Note Capital Note 3 - - 600,000 6,000,000 - - - - 600,000 6,000,000 Industry Co., Ltd. Microsystems 1(1) Increase by Corporation Cash Foxconn (Far General Interface Note Note 2 None - - 25,500 USD 25,500 - - - - 25,500 USD 25,500 East) Limited Solution Holding 1(1) (in thousands) (in thousands) Limited Hyield Venture Taiwan Intelligent Note Public None - - 35,643 405,649 - - - - 35,643 405,649 Capital Co., Ltd. Fiber Optic 1(1) Market Network Consortium Hong Fujin Interface Note Note 2 None - - - - - USD 39,500 USD 39,500 - - - Precision Optoelectronics 1(1) (in thousands) (in thousands) Industrial (Shenzhen) Co., (Shenzhen) Co., Ltd. Ltd. Hongfujin Interface Note Note 2 None - - - - - USD 25,500 USD 25,500 - - - Precision Technology 1(1) (in thousands) (in thousands) Electrons (Yantai) (ChengDu) Co., Co., Ltd. Ltd. Ocean Triumph Mediamarkt Note Note 4 None Note 5 - - - - USD 17,500 - USD 17,500 - - Ltd. (China) Inter- 1(1) (in thousands) (in thousands) National Retail Holding Ltd. Foxconn (Far Olympus Note Public None 3,315 USD 46,197 - - 1,572 USD 47,187 USD 25,010 USD 22,177 1,743 USD 21,187 East) Limited Corporation 1(2) Market (in thousands) (in thousands) (in thousands) (in thousands) (in thousands) Foxteq MSDC denali Note Note 6 None - - - USD 30,000 - - - - - USD 30,000 Holding Inc. investors, L.P. 1(3) (in thousands) (in thousands)
Note 1: Code of general ledger accounts is (1) investments accounted for under equity method (2) available-for-sale financial assets (3) financial assets carried at cost Note 2: The counterparty is General Interface Solution Holding Limited (Formerly: Blooming Progress Limited) Note 3: The counterparty is a subsidiary of the Company. Note 4: The counterparty is Media-Saturn China-holding Limited. Note 5: Because the investee company does not issue common stock, no common stock is held by the Company. The Company retains the original shareholding of 25%. Note 6: Acquired through private placement.
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E. Acquisition of real estate reaching $100 million or 20% of paid-in capital or more: None. F. Disposal of real estate reaching $100 million or 20% of paid-in capital or more: None. G. Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid-in capital or more: Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note Hon Hai Precision Industry Co., Ltd. Foxconn (Far East) Limited and Group Sales$ 34,454,657 1 45-90 days Note 1 Note 1$ 26,998,491 4 Note 2 subsidiaries Hon Hai Precision Industry Co., Ltd. SIO International Inc. Note 5 Sales 27,731,987 1 100 days Note 1 Note 1 7,685,873 1
Hon Hai Precision Industry Co., Ltd. Foxconn CZ S. R. O. Group Sales 18,907,477 1 45 days Note 1 Note 1 - - Note 2
Hon Hai Precision Industry Co., Ltd. Foxconn Singapore (PTE) Ltd. Group Sales 9,288,207 - 90 days Note 1 Note 1 2,635,140 -
Hon Hai Precision Industry Co., Ltd. Foxconn Slovakia, Spol. S R. O. Group Sales 9,174,845 - 60 days Note 1 Note 1 2,338,735 -
Hon Hai Precision Industry Co., Ltd. Foxconn Japan Co., Ltd. Group Sales 4,792,392 - 90 days Note 1 Note 1 801,186 -
Hon Hai Precision Industry Co., Ltd. Ingrasys Technology Co., Ltd. Group Sales 4,234,683 - 90 days Note 1 Note 1 5,592,413 1 Note 2
Hon Hai Precision Industry Co., Ltd. Ningbo Innolux Optoelectronics Ltd. Note 7 Sales 2,550,833 - 90 days Note 1 Note 1 600,154 -
Hon Hai Precision Industry Co., Ltd. CyberTAN Technology Inc. Affiliates Sales 1,900,669 - 60 days Note 1 Note 1 494,705 - Note 2
Hon Hai Precision Industry Co., Ltd. Ennoconn Corporation Group Sales 1,877,289 - 60 days Note 1 Note 1 277,584 -
Hon Hai Precision Industry Co., Ltd. Nanhai Chi Mei Optoelectronics Ltd. Note 7 Sales 1,250,046 - 90 days Note 1 Note 1 491,562 -
Hon Hai Precision Industry Co., Ltd. Innolux Corporation Note 6 Sales 1,164,981 - 90 days Note 1 Note 1 337,151 -
Hon Hai Precision Industry Co., Ltd. Foxteq Australia Pty Ltd. Group Sales 979,701 - 60 days Note 1 Note 1 241,322 -
Hon Hai Precision Industry Co., Ltd. Foxconn Rus LLC Group Sales 888,371 - 45 days Note 1 Note 1 129,194 -
Hon Hai Precision Industry Co., Ltd. Foxconn MOEBG Industria De Group Sales 888,155 - 120 days Note 1 Note 1 655,542 - Eletronicos Ltda.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Hon Hai Precision Industry Co., Ltd. SIO International Holdings Limited Note 6 Sales$ 887,421 - 60 days Note 1 Note 1$ 90,622 -
Hon Hai Precision Industry Co., Ltd. Ningbo Innolux Technology Ltd. Note 7 Sales 706,752 - 90 days Note 1 Note 1 206,732 -
Hon Hai Precision Industry Co., Ltd. Zenith Profits Co., Ltd. Affiliates Sales 643,303 - 45 days Note 1 Note 1 103,066 -
Hon Hai Precision Industry Co., Ltd. Ambit Microsystem (Shanghai) Co., Group Sales 594,975 - 60 days Note 1 Note 1 1,273,460 - Note 2 Ltd. Hon Hai Precision Industry Co., Ltd. Foxconn Technology PTE, Ltd. Affiliates Sales 584,509 - 90 days Note 1 Note 1 84,947 - Note 2
Hon Hai Precision Industry Co., Ltd. Foxconn Technology Co., Ltd. Affiliates Sales 512,175 - 30 days Note 1 Note 1 91,638 -
Hon Hai Precision Industry Co., Ltd. Fukui Precision Component Affiliates Sales 450,621 - 90 days Note 1 Note 1 237,301 - Note 2 (Shenzhen) Co., Ltd. Hon Hai Precision Industry Co., Ltd. Pan International Affiliates Sales 318,777 - 90 days Note 1 Note 1 153,147 - Electronics (Malaysia) Hon Hai Precision Industry Co., Ltd. Foxstar Technology Co., Ltd. Affiliates Sales 294,407 - 90 days Note 1 Note 1 - -
Hon Hai Precision Industry Co., Ltd. Fenix Industria De Eletronicos Ltda. Group Sales 257,847 - 90 days Note 1 Note 1 25,644 -
Hon Hai Precision Industry Co., Ltd. Fuhong Precision Component Group Sales 243,556 - 90 days Note 1 Note 1 2,504,130 - Note 2 (Bac Giang) Limited Hon Hai Precision Industry Co., Ltd. Foxconn Global Services Division Group Sales 217,222 - 45 days Note 1 Note 1 152,498 -
Hon Hai Precision Industry Co., Ltd. Ingrasys Technology USA Inc. Group Sales 206,140 - 70 days Note 1 Note 1 1,666 -
Hon Hai Precision Industry Co., Ltd. Funing Precision Component Co., Group Sales 187,035 - 90 days Note 1 Note 1 1,438,253 - Note 2 Ltd. Hon Hai Precision Industry Co., Ltd. Interface Optoelectronics (SZ) Co., Affiliates Sales 182,248 - 45 days Note 1 Note 1 582,290 - Note 2 Ltd. Hon Hai Precision Industry Co., Ltd. Yantai Zheng Yi Precision Affiliates Sales 153,049 - 30 days Note 1 Note 1 6,092 - Electronic Co., Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Hon Hai Precision Industry Co., Ltd. Pan-International Industrial Co. Affiliates Sales$ 126,072 - 90 days Note 1 Note 1$ 32,784 -
Hon Hai Precision Industry Co., Ltd. Ningbo Innolux Display Ltd. Note 7 Sales 114,413 - 90 days Note 1 Note 1 62,097 -
Hon Hai Precision Industry Co., Ltd. Hongqisheng Precision Electronics Affiliates Sales 108,496 - 90 days Note 1 Note 1 36,125 - (Qinhuangdao) Co., Ltd. Hon Hai Precision Industry Co., Ltd. Cheng Uei Precision Industry Co., Note 4 Sales 100,226 - 30-90 days Note 1 Note 1 14,772 - Ltd. Hon Hai Precision Industry Co., Ltd. Competition Team Technologies Group Purchase 745,536,247 25 90 days Note 1 Note 1( 217,652,991) ( 35) Ltd. Hon Hai Precision Industry Co., Ltd. Best Leap Enterprises Limited Group Purchase 612,504,729 21 90 days Note 1 Note 1( 163,357,216) ( 26)
Hon Hai Precision Industry Co., Ltd. Foxconn (Far East) Limited and Group Purchase 365,963,594 12 30-90 days Note 1 Note 1( 73,123,413) ( 12) subsidiaries Hon Hai Precision Industry Co., Ltd. Falcon Precision Trading Limited Group Purchase 325,435,258 11 45 days Note 1 Note 1( 37,803,768) ( 6)
Hon Hai Precision Industry Co., Ltd. Universal Field International Limited Group Purchase 122,692,944 4 90 days Note 1 Note 1( 28,528,389) ( 5)
Hon Hai Precision Industry Co., Ltd. Foxconn CZ S.R.O. Group Purchase 72,914,813 2 60 days Note 1 Note 1( 4,048,419) ( 1)
Hon Hai Precision Industry Co., Ltd. AMB Logistics Ltd. Group Purchase 23,262,721 1 60 days Note 1 Note 1( 6,275,837) ( 1)
Hon Hai Precision Industry Co., Ltd. HongFuJin Precision Electronics Group Purchase 15,287,104 1 30-90 days Note 1 Note 1( 191) - (ChengDu) Limited Hon Hai Precision Industry Co., Ltd. IRIS World Enterprises Limited Affiliates Purchase 5,082,454 - 90 days Note 1 Note 1( 1,137,853) -
Hon Hai Precision Industry Co., Ltd. NSG Technology, Inc. Group Purchase 3,736,595 - 30 days Note 1 Note 1( 160,577) - Note 3
Hon Hai Precision Industry Co., Ltd. Fortune Source Enterprises Limited Affiliates Purchase 2,701,580 - 90 days Note 1 Note 1( 382,903) -
Hon Hai Precision Industry Co., Ltd. Foxstar Technology Co., Ltd. Affiliates Purchase 1,167,754 - 60 days Note 1 Note 1( 440,278) -
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Hon Hai Precision Industry Co., Ltd. Cheng Uei Precision Industry Co., Note 4 Purchase$ 986,942 - 30 days Note 1 Note 1($ 481,608) - Ltd. Hon Hai Precision Industry Co., Ltd. CyberTAN Technology Inc. Affiliates Purchase 776,734 - 75 days Note 1 Note 1( 42,121) -
Hon Hai Precision Industry Co., Ltd. Foxconn Technology PTE. Ltd. Affiliates Purchase 537,168 - 90 days Note 1 Note 1( 117,698) -
Hon Hai Precision Industry Co., Ltd. FTC Technology Inc. Affiliates Purchase 527,812 - 60 days Note 1 Note 1( 110,538) -
Hon Hai Precision Industry Co., Ltd. Innolux Corporation Note 6 Purchase 418,362 - 60 days Note 1 Note 1( 172,400) -
Hon Hai Precision Industry Co., Ltd. SIO International Inc. Note 5 Purchase 321,633 - 90 days Note 1 Note 1( 7,537) -
Hon Hai Precision Industry Co., Ltd. Tekcon Electronics Corp. Affiliates Purchase 280,162 - 45 days Note 1 Note 1( 466) -
Hon Hai Precision Industry Co., Ltd. Foxconn Technology Co., Ltd. Affiliates Purchase 213,637 - 60 days Note 1 Note 1( 19,741) -
Hon Hai Precision Industry Co., Ltd. FTP Technology Inc. Affiliates Purchase 193,510 - 60 days Note 1 Note 1( 40,121) -
Hon Hai Precision Industry Co., Ltd. General Interface Solution Limited Affiliates Purchase 185,285 - 60 days Note 1 Note 1( 4,527) -
Hon Hai Precision Industry Co., Ltd. Lakers Trading Limited Note 7 Purchase 156,859 - 90 days Note 1 Note 1( 1,309) -
Hon Hai Precision Industry Co., Ltd. Ampower Technology Co., Ltd. Affiliates Purchase 110,262 - 90 days Note 1 Note 1( 35,273) -
Hon Hai Precision Industry Co., Ltd. Franklin Management Ltd. Group Processing 22,568,440 23 - Note 1 Note 1( 19,928,615) ( 18) and molding costs (Shown as accrued expenses payable) Hon Hai Precision Industry Co., Ltd. Success Rise Enterprises Ltd. Group Processing 18,398,975 19 - Note 1 Note 1( 4,908,625) ( 5) and molding costs (Shown as accrued expenses payable) Hon Hai Precision Industry Co., Ltd. Heroic Legend Enterprises Ltd. Group Processing 17,528,969 18 - Note 1 Note 1( 19,027,739) ( 19) and molding costs (Shown as accrued expenses payable)
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Hon Hai Precision Industry Co., Ltd. Best Leap Enterprises Limited Group Processing $ 15,885,771 16 - Note 1 Note 1($ 568,718) ( 1) and molding costs (Shown as accrued expenses payable) Hon Hai Precision Industry Co., Ltd. Foxconn (Far East) Limited and Group Processing 11,694,186 12 - Note 1 Note 1( 34,547,347) ( 33) subsidiaries and molding costs (Shown as accrued expenses payable) Hon Hai Precision Industry Co., Ltd. Beyond Maximum Industrial Ltd. Group Processing 6,787,660 7 - Note 1 Note 1( 583,615) ( 1) and molding costs (Shown as accrued expenses payable) Hon Hai Precision Industry Co., Ltd. Carston Ltd. Group Processing 4,173,218 4 - Note 1 Note 1( 25,022,370) ( 24) and molding costs (Shown as accrued expenses payable) Ambit Micorsystems (Zhong Shan) Ambit Microsystems Corporation Group Sales 2,405,023 99 45 days Note 1 Note 1 - - Corporation Ltd. Ambit Microsystem (Shanghai) Co., AMB Logistics Ltd. Group Sales 29,911,706 82 60 days Note 1 Note 1 5,476,513 81 Ltd. Ambit Microsystem (Shanghai) Co., Amworld Microsystems (Shanghai) Group Sales 1,512,723 4 120 days Note 1 Note 1 194,252 3 Ltd. Ltd. Ambit Microsystem (Shanghai) Co., Hongfujin Precision Industry (Yantai) Group Sales 250,544 1 90 days Note 1 Note 1 40,469 1 Ltd. Co., Ltd. Ambit Microsystem (Shanghai) Co., Foxconn Technology (India) Private Group Sales 101,471 - 120 days Note 1 Note 1 134,398 2 Ltd. Limited Ambit Microsystem (Shanghai) Co., System Integration Electronics Group Sales 315,817 1 60 days Note 1 Note 1 33,873 1 Ltd. (Hangzhou) Co., Ltd. Ambit Microsystem (Shanghai) Co., CyberTAN Technology Inc. Affiliates Sales 475,445 1 90 days Note 1 Note 1 2,167 - Ltd. Ambit Microsystem (Shanghai) Co., Innolux Corporation Ltd. Note 7 Purchase 120,696 - 60 days Note 1 Note 1( 21,303) - Ltd. Ambit Microsystem (Shanghai) Co., CyberTAN Technology Inc. Affiliates Purchase 111,090 - 60 days Note 1 Note 1( 9,801) - Ltd. Ambit Microsystem (Shanghai) Co., Foxconn Technology Pte. Ltd. Affiliates Purchase 725, 276 2 60 days Note 1 Note 1( 129,105) ( 2) Ltd. Ambit Microsystem (Shanghai) Co., IRIS World Enterprises Limited Affiliates Purchase 26 6,714 1 90 days Note 1 Note 1( 71,449) ( 1) Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Ingrasys Technology Co.Ltd. Ingrasys Technology USA Inc. Group Sales$ 11,584,604 61 70 days Note 1 Note 1$ 3,897,163 70 Ingrasys Technology Co.Ltd. PCE Paragon Solutions Kft. Group Sales 869,352 5 45 days Note 1 Note 1 147,580 3 Honxun Electrical Industry Foxconn Precision Component Group Sales 144,952 1 60 days Note 1 Note 1 45,226 3 (Hangzhou) Co., Ltd. (Beijing) Co., Ltd. Honxun Electrical Industry FIH (Hong Kong) Limited Group Sales 520,903 5 60 days Note 1 Note 1 197,355 11 (Hangzhou) Co., Ltd. Honxun Electrical Industry Nanning Futaihong Precision Group Sales 259,986 2 60 days Note 1 Note 1 309,791 18 (Hangzhou) Co., Ltd. Industrial Co., Ltd. Honxun Electrical Industry Hon Fujin Precision Industry Affiliates Purchase 146,239 21 90 days Note 1 Note 1( 67,265) ( 5) (Hangzhou) Co., Ltd. (Taiyuan) Co., Ltd. Shenzhen Fu Tai Hong Precision FIH Precision Electronics (Lang Fang) Group Sales 170,235 1 45 days Note 1 Note 1 206,254 10 Industry Co., Ltd. Co., Ltd. Shenzhen Fu Tai Hong Precision FIH (Hong Kong) Limited Group Sales 1,174,792 8 60 days Note 1 Note 1 1,996 - Industry Co., Ltd. Shenzhen Fu Tai Hong Precision Nanning Futaihong Precision Group Sales 2,823,965 19 60 days Note 1 Note 1 257,977 12 Industry Co., Ltd. Industrial Co., Ltd. Shenzhen Fu Tai Hong Precision Hongfujin Precision Industry Group Sales 1,106,221 8 45 days Note 1 Note 1 360,490 17 Industry Co., Ltd. (Shenzhen) Co., Ltd. Shenzhen Fu Tai Hong Precision Futaihua Industrial (Shenzhen) Group Sales 108,328 1 60 days Note 1 Note 1 83,944 4 Industry Co., Ltd. Limited Foxconn Precision Component FIH Precision Electronics (Lang Fang) Group Sales 1,465,431 22 45 days Note 1 Note 1 137,420 11 (Beijing) Co., Ltd. Co., Ltd. Foxconn Precision Component FIH (Hong Kong) Limited Group Sales 1,148,102 17 30 days Note 1 Note 1 93,421 7 (Beijing) Co., Ltd. Foxconn Precision Component IRIS World Enterprises Limited Affiliates Purchase 12 4,464 3 60 days Note 1 Note 1( 18,565) ( 1) (Beijing) Co., Ltd. FIH (Tian Jin) Precision Industry FIH Precision Electronics (Lang Fang) Group Sales 840,251 36 30 days Note 1 Note 1 527,438 65 Co., Ltd. Co., Ltd. FIH (Tian Jin) Precision Industry FIH (Hong Kong) Limited Group Sales 1,089,759 47 60 days Note 1 Note 1 3,592 - Co., Ltd. FIH Do Brasil Industria E Comercio IRIS World Enterprises Limited Affiliates Purchase 10 0,295 4 60 days Note 1 Note 1( 32,271) ( 2) De Eletronicos Ltda.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
FIH Mexico Precision Industry Co., S&B Industry Inc. Group Sales$ 615,040 9 60 days Note 1 Note 1$ 153,998 14 S.A. De C.V. Futaijing Precision Electronics Foxconn Precision Component Group Sales 254,153 2 60 days Note 1 Note 1 162,964 18 (Beijing) Co., Ltd. (Beijing) Co., Ltd. Futaijing Precision Electronics FIH Precision Electronics (Lang Fang) Group Sales 225,129 1 45 days Note 1 Note 1 222,348 24 (Beijing) Co., Ltd. Co., Ltd. Futaijing Precision Electronics FIH (Hong Kong) Limited Group Sales 109,358 1 30 days Note 1 Note 1 62,564 7 (Beijing) Co., Ltd. Futaijing Precision Electronics FuTaiJing Precision Electrons Group Sales 208,576 1 45 days Note 1 Note 1 26,370 3 (Beijing) Co., Ltd. (Yantai) Co., Ltd. FIH Precision Electronics (Lang Fang) Foxconn Precision Component Group Sales 1,756,784 5 45 days Note 1 Note 1 271,886 3 Co., Ltd. (Beijing) Co., Ltd. FIH Precision Electronics (Lang Fang) FIH (Tian Jin) Precision Industry Group Sales 224,460 1 45 days Note 1 Note 1 82,004 1 Co., Ltd. Co., Ltd. FIH Precision Electronics (Lang Fang) FIH (Hong Kong) Limited Group Sales 14,184,111 40 30 days Note 1 Note 1 3,514,088 36 Co., Ltd. FIH Precision Electronics (Lang Fang) Eliteday Enterprises Limited Group Sales 1,357,089 4 60 days Note 1 Note 1 10,651 - Co., Ltd. FIH Precision Electronics (Lang Fang) General Interface Solution Limited Affiliates Purchase 136,703 1 60 days Note 1 Note 1( 4,105) - Co., Ltd. FIH Precision Electronics (Lang Fang) Hon Fujin Precision Industry Affiliates Purchase 1,050,560 6 60 days Note 1 Note 1( 692,409) ( 9) Co., Ltd. (Taiyuan) Co., Ltd. FIH (Hong Kong) Limited Shenzhen Fu Tai Hong Precision Group Sales 802,017 1 45 days Note 1 Note 1 185,466 1 Industry Co., Ltd. FIH (Hong Kong) Limited Chi Mei Communication System, Inc. Group Sales 646,801 1 90 days Note 1 Note 1 85,571 -
FIH (Hong Kong) Limited FIH India Private Limited Group Sales 203,305 - 45 days Note 1 Note 1 54,516 - FIH (Hong Kong) Limited Foxconn Precision Component Group Sales 146,143 - 30 days Note 1 Note 1 13,433 - (Beijing) Co., Ltd. FIH (Hong Kong) Limited Sutech Industry Inc. Group Sales 482,841 1 75 days Note 1 Note 1 - - FIH (Hong Kong) Limited FIH Precision Electronics (Lang Fang) Group Sales 500,581 1 45 days Note 1 Note 1 67,500 - Co., Ltd. FIH (Hong Kong) Limited FuTaiJing Precision Electrons Group Sales 1,567,560 2 60 days Note 1 Note 1 1,002,488 3 (Yantai) Co., Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
FIH (Hong Kong) Limited Hengyang Futaihong Precision Group Sales$ 6,117,844 9 120 days Note 1 Note 1$ 4,801,120 13 Industry FIH (Hong Kong) Limited Shenzhen Fuhongjie Technology Group Sales 196,891 - 60 days Note 1 Note 1 93,732 - Service Co., Ltd. FIH (Hong Kong) Limited HongFuJin Precision Electronics Group Sales 1,319,446 2 45 days Note 1 Note 1 747,159 2 (ZhenZhou) Limited FIH (Hong Kong) Limited IRIS World Enterprises Limited Affiliates Purchase 132,381 - 90 days Note 1 Note 1( 124,239) - Nanning Futaihong Precision Honxun Electrical Industry Group Sales 260,001 4 60 days Note 1 Note 1 310,124 17 Industrial Co., Ltd. (Hangzhou) Nanning Futaihong Precision Shenzhen Fu Tai Hong Precision Group Sales 3,153,439 42 60 days Note 1 Note 1 303,003 17 Industrial Co., Ltd. Industry Co., Ltd. FuTaiJing Precision Electrons FIH Do Brasil Industria E Comercio Group Sales 237,448 1 45 days Note 1 Note 1 82,616 7 (Yantai) Co., Ltd. De Eletronicos Ltda. FuTaiJing Precision Electrons Futaijing Precision Electronics Group Sales 1,515,830 4 45 days Note 1 Note 1 - - (Yantai) Co., Ltd. (Beijing) Co., Ltd. FuTaiJing Precision Electrons FIH (Hong Kong) Limited Group Sales 38,136,822 95 30 days Note 1 Note 1 1,128,181 92 (Yantai) Co., Ltd. FuTaiJing Precision Electrons IRIS World Enterprises Limited Affiliates Purchase 1, 239,407 3 60 days Note 1 Note 1( 405,942) ( 6) (Yantai) Co., Ltd. Hengyang Futaihong Precision FIH (Hong Kong) Limited Group Sales 6,833,213 100 120 days Note 1 Note 1 5,356,863 99 Industry Co., Ltd. Foxway Precision Industry System Integration Electronics Group Sales 119,346 23 45 days Note 1 Note 1 43,050 33 (Hangzhou) Co., Ltd. (Hangzhou) Co., Ltd. Carston Ltd. FIH (Hong Kong) Limited Group Subcontract 370,979 5 90 days Note 1 Note 1 200,610 1 Revenue Carston Ltd. General Interface Solution Limited Affiliates Subcontract 297,055 4 90 days Note 1 Note 1 298,255 1 Revenue Carston Ltd. Lakers Trading Limited Note 7 Subcontract 400,299 6 90 days Note 1 Note 1 1,470,352 5 Revenue Carston Ltd. High Tempo International Ltd. Affiliates Subcontract 832,839 12 90 days Note 1 Note 1 - - Revenue Carston Ltd. IRIS World Enterprises Limited Affiliates Subcontract 142,722 2 90 days Note 1 Note 1 - - Revenue
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Carston Ltd. High Tempo International Ltd. Affiliates Subcontract $ 762,714 17 90 days Note 1 Note 1($ 160,278) - Fee Carston Ltd. Best Ever Industries Ltd. Group Subcontract 410,666 6 90 days Note 1 Note 1 412,326 1 Revenue Hongfujin Precision Industry Ambit Microsystem (Shanghai) Co., Group Sales 128,248 - 90 days Note 1 Note 1 6,302 - (Shenzhen) Co., Ltd. Ltd. Hongfujin Precision Industry Shenzhen Fu Tai Hong Precision Group Sales 640,007 1 90 days Note 1 Note 1 159,522 1 (Shenzhen) Co., Ltd. Industry Co., Ltd. Hongfujin Precision Industry FIH Precision Electronics (Lang Fang) Group Sales 150,194 - 90 days Note 1 Note 1 61,338 - (Shenzhen) Co., Ltd. Co., Ltd. Hongfujin Precision Industry Hengyang Futaihong Precision Group Sales 244,868 - 120 days Note 1 Note 1 180,373 1 (Shenzhen) Co., Ltd. Industry Co., Ltd. Hongfujin Precision Industry Fu Ding Precision Component Group Sales 3,116,633 5 90 days Note 1 Note 1 905,925 6 (Shenzhen) Co., Ltd. (Shenzhen) Co., Ltd. Hongfujin Precision Industry Fujin Precision Industrial (Jincheng) Group Sales 536,996 1 90 days Note 1 Note 1 120,411 1 (Shenzhen) Co., Ltd. Co., Ltd. Hongfujin Precision Industry Jizhun Precision Industry (Huizhou) Group Sales 172,322 - 90 days Note 1 Note 1 62,082 - (Shenzhen) Co., Ltd. Co., Ltd. Hongfujin Precision Industry Hongfujin Precision Industry (Wuhan) Group Sales 131,502 - 90 days Note 1 Note 1 24,145 - (Shenzhen) Co., Ltd. Co., Ltd. Hongfujin Precision Industry Futaihua Industrial (Shenzhen) Group Sales 5,737,945 9 90 days Note 1 Note 1 2,057,419 14 (Shenzhen) Co., Ltd. Limited Hongfujin Precision Industry Honfujin Precision Electronics Group Sales 168,534 - 30 days Note 1 Note 1 35,135 - (Shenzhen) Co., Ltd. (Chongqing) Co., Ltd. Hongfujin Precision Industry HongFuJing Precision Electronics Group Sales 131,906 - 60 days Note 1 Note 1 138,088 1 (Shenzhen) Co., Ltd. (TianJin) Co., Ltd. Hongfujin Precision Industry FuXun Tong Trading(ShenZhen) Co., Group Sales 183,507 - 30 days Note 1 Note 1 6,365 - (Shenzhen) Co., Ltd. Ltd. Hongfujin Precision Industry HongFuJin Precision Electronics Group Sales 511,678 1 90 days Note 1 Note 1 272,672 2 (Shenzhen) Co., Ltd. (ChengDu) Limited Hongfujin Precision Industry NanNing FuGui Precision Industrial Group Sales 1,594,062 3 90 days Note 1 Note 1 943,735 6 (Shenzhen) Co., Ltd. Co., Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Hongfujin Precision Industry HongFuJin Precision Electronics Group Sales$ 1,079,118 2 90 days Note 1 Note 1$ 556,634 4 (Shenzhen) Co., Ltd. (ZhenZhou) Limited Hongfujin Precision Industry Foxconn Precision Electronics Group Sales 115,000 - 90 days Note 1 Note 1 51,588 - (Shenzhen) Co., Ltd. (Taiyuan) Co., Ltd. Hongfujin Precision Industry FuTaiHua Precision Electronics Group Sales 631,803 1 30 days Note 1 Note 1 364,807 2 (Shenzhen) Co., Ltd. (JiYuan) Limited Hongfujin Precision Industry HongFuJin Precision Electrons Group Sales 329,627 1 30 days Note 1 Note 1 41,150 - (Shenzhen) Co., Ltd. (HengYang) Co., Ltd. Hongfujin Precision Industry Interface Optoelectronics (SZ) Co., Affiliates Sales 406,100 1 30 days Note 1 Note 1 90,223 1 (Shenzhen) Co., Ltd. Ltd. Hongfujin Precision Industry Hon Fujin Precision Industry Affiliates Sales 146,391 - 90 days Note 1 Note 1 22,904 - (Shenzhen) Co., Ltd. (Taiyuan) Co., Ltd. Hongfujin Precision Industry Hon Fujin Precision Industry Affiliates Purchase 1,105,002 6 90 days Note 1 Note 1( 492,489) ( 4) (Shenzhen) Co., Ltd. (Taiyuan) Co., Ltd. Hongfujin Precision Industry Fuhuigang Industral (Shenzhen) Co., Affiliates Purchase 189,645 1 90 days Note 1 Note 1( 24,112) - (Shenzhen) Co., Ltd. Ltd. Hongfujin Precision Industry Carston Ltd. Group Subcontract 2,176,027 3 90 days Note 1 Note 1 850,331 6 (Shenzhen) Co., Ltd. Revenue Hongfujin Precision Industry Heroic Legend Enterprises Ltd. Group Subcontract 14,062,455 22 50 days Note 1 Note 1 1,601,410 11 (Shenzhen) Co., Ltd. Revenue Hongfujin Precision Industry Franklin Management Ltd. Group Subcontract 16,875,075 27 30 days Note 1 Note 1 2,339,258 16 (Shenzhen) Co., Ltd. Revenue Hongfujin Precision Industry Lakers Trading Limited Note 7 Subcontract 200,887 - 90 days Note 1 Note 1 - - (Shenzhen) Co., Ltd. Revenue Fu Ding Precision Component Beyond Maximum Industrial Ltd. Group Subcontract 5,157,646 71 30 days Note 1 Note 1 129,101 6 (Shenzhen) Co., Ltd. Revenue Fu Ding Precision Component Futaihua Industrial (Shenzhen) Group Sales 127,938 2 90 days Note 1 Note 1 6,264 - (Shenzhen) Co., Ltd. Limited Fu Ding Precision Component New Beyond Maximum Industrial Group Subcontract 1,719,327 24 30 days Note 1 Note 1 1,752,784 78 (Shenzhen) Co., Ltd. Limited Revenue Fuhong Precision Component Best Matrix Enterprises Ltd. Group Sales 296,855 100 30 days Note 1 Note 1 28,493 98 (Shenzhen) Co., Ltd. Champ Tech Optical (FoShan) Futaihua Industrial (Shenzhen) Group Sales 171,599 4 90 days Note 1 Note 1 68,298 5 Corporation Limited
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Champ Tech Optical (FoShan) HongFuJin Precision Electronics Group Sales$ 133,449 3 90 days Note 1 Note 1$ 91,839 7 Corporation (ZhenZhou) Limited Champ Tech Optical (FoShan) Foxconn Technology PTE. Ltd. Affiliates Sales 2,469,9 84 57 90 days Note 1 Note 1 614,763 44 Corporation Champ Tech Optical (FoShan) Fuzhun Precision (Shenzhen) Industry Affiliates Sales 103,469 2 90 days Note 1 Note 1 73,060 5 Corporation Co., Ltd. Champ Tech Optical (FoShan) Foxconn Technology Co., Ltd. Affiliates Sales 961,591 22 90 days Note 1 Note 1 210,349 15 Corporation Champ Tech Optical (FoShan) Hon Fujin Precision Industry Affiliates Purchase 116,923 4 30 days Note 1 Note 1( 37,746) ( 2) Corporation (Taiyuan) Co., Ltd. Champ Tech Optical (FoShan) Foxconn Technology Co., Ltd. Affiliates Purchase 340, 491 10 90 days Note 1 Note 1( 98,277) ( 5) Corporation Fuding Electronical Technology Fuxiang Precision Industrial Group Sales 492,662 5 90 days Note 1 Note 1 460,010 10 (Jiashan) Co., Ltd. (kunshan) Fuding Electronical Technology Futaihua Industrial (Shenzhen) Group Sales 5,168,165 50 90 days Note 1 Note 1 1,421,878 31 (Jiashan) Co., Ltd. Limited Fuding Electronical Technology Foxconn Technology PTE. Ltd. Affiliates Purchase 250, 916 4 90 days Note 1 Note 1( 149,771) ( 5) (Jiashan) Co., Ltd. Fuhonyang Precision Industrial MWM Co., Ltd. Group Subcontract 3,983,162 99 90 days Note 1 Note 1 1,971,077 100 (Shenzhen) Co., Ltd. Revenue Kangzhun Electronic Technology Fuding Electronical Technology Group Sales 509,989 3 90 days Note 1 Note 1 419,896 7 (Kunshan) Co., Ltd. (Jiashan) Co., Ltd. Kangzhun Electronic Technology Fuxiang Precision Industrial Group Sales 2,189,544 12 90 days Note 1 Note 1 1,168,003 20 (Kunshan) Co., Ltd. (Kunshan) Kangzhun Electronic Technology Tripleheads International Ltd. Group Sales 1,112,428 6 90 days Note 1 Note 1 942,207 16 (Kunshan) Co., Ltd. Kangzhun Electronic Technology Foxconn Technology PTE. Ltd. Affiliates Sales 253,294 1 90 days Note 1 Note 1 91,840 2 (Kunshan) Co., Ltd. Kangzhun Electronic Technology Innolux Corporation Ltd. Note 7 Purchase 693,396 4 90 days Note 1 Note 1( 287,988) ( 2) (Kunshan) Co., Ltd. Kangzhun Electronic Technology Pan-International Industrial Co. Affiliates Purchase 104,450 1 90 days Note 1 Note 1( 31,391) - (Kunshan) Co., Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Fuxiang Precision Industrial Fuding Electronical Technology Group Sales$ 502,114 3 90 days Note 1 Note 1$ 416,701 7 (Kunshan) Co., Ltd. (Jiashan) Co., Ltd. Fuxiang Precision Industrial Kangzhun Electronic Technology Group Sales 559,966 4 90 days Note 1 Note 1 1,069,014 17 (Kunshan) Co., Ltd. (Kunshan) Co., Ltd. Fuxiang Precision Industrial Foxconn (Kun Shan) Computer Group Sales 204,247 1 90 days Note 1 Note 1 65,129 1 (Kunshan) Co., Ltd. Connector Co., Ltd. Fuxiang Precision Industrial Fusing International Inc. Pte. Group Sales 1,142,517 8 90 days Note 1 Note 1 544,018 9 (Kunshan) Co., Ltd. Ltd.-Singapore Fuxiang Precision Industrial Futaihua Industrial (Shenzhen) Group Sales 735,425 5 60 days Note 1 Note 1 118,150 2 (Kunshan) Co., Ltd. Limited Fuxiang Precision Industrial HongFuJin Precision Electronics Group Sales 115,840 1 30 days Note 1 Note 1 24,357 - (Kunshan) Co., Ltd. (ChengDu) Limited Fuxiang Precision Industrial Fuhong Precision Component Group Sales 101,619 1 60 days Note 1 Note 1 29,458 - (Kunshan) Co., Ltd. (Bac Giang) Limited Fuxiang Precision Industrial Foxconn Technology PTE. Ltd. Affiliates Sales 331,091 2 90 days Note 1 Note 1 121,145 2 (Kunshan) Co., Ltd. Fuxiang Precision Industrial Foxconn Technology PTE. Ltd. Affiliates Purchase 240, 049 3 90 days Note 1 Note 1( 47,908) ( 1) (Kunshan) Co., Ltd. Foxconn (Kun Shan) Computer Foxconn Electronic Industrial Group Sales 400,804 3 90 days Note 1 Note 1 1,583,778 62 Connector Co., Ltd. Develpment (Kunshan) Co., Ltd. Foxconn (Kun Shan) Computer Success Rise Enterprises Ltd. Group Subcontract 10,603,869 80 90 days Note 1 Note 1 - - Connector Co., Ltd. Revenue Foxconn (Kun Shan) Computer New Beyond Maximum Industrial Group Subcontract 2,216,391 17 90 days Note 1 Note 1 814,710 100 Connector Co., Ltd. Limited Revenue Hongye Precision Component FuXun Tong Trading (ShenZhen) Co., Group Sales 2,453,600 78 30 days Note 1 Note 1 1,067,982 78 (Kunshan) Ltd. Foxconn Electronic Industrial Foxconn (Kun Shan) Computer Group Sales 7,694,842 100 90 days Note 1 Note 1 4,343,734 99 Develpment (Kunshan) Co., Ltd. Connector Co., Ltd. Qunkang Precision Component Smart Top International Ltd. Group Sales 1,192,903 100 90 days Note 1 Note 1 105 100 (Kunshan) Co., Ltd. Competition Team Technologies Ltd. FuTaiHua Precision Electronics Group Sales 466,909 - 90 days Note 1 Note 1 41,272 - (ZhenZhou) Limited
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Competition Team Technologies Ltd. HongFuJin Precision Electronics Group Sales$ 6,625,986 1 90 days Note 1 Note 1$ 4,613,149 2 (ZhenZhou) Limited HighTech Electronics Components Foxconn Image & Printing Product Group Sales 35,462,677 32 45 days Note 1 Note 1 4,842,123 23 Inc. Pte. Ltd. HighTech Electronics Components Honfujin Precision Electronics Group Sales 722,138 1 60 days Note 1 Note 1 4,394,985 21 Inc. (Chongqing) Co., Ltd. HighTech Electronics Components Fusing International Inc. Group Sales 10,682,888 10 60 days Note 1 Note 1 4,007,905 19 Inc. HighTech Electronics Components Competition Team Ireland Limited Group Sales 14,511,1 40 13 90 days Note 1 Note 1 1,846,546 9 Inc. HighTech Electronics Components Foxconn Japan Co., Ltd. Group Sales 1,132,605 1 60 days Note 1 Note 1 255,850 1 Inc. HighTech Electronics Components Foxconn Singapore PTE. Ltd. Group Sales 172,547 - 90 days Note 1 Note 1 - - Inc. Smart Top International Ltd. Hongye Precision Component Group Sales 118,109 4 60 days Note 1 Note 1 98,553 26 (Kunshan) Co., Ltd. Smart Top International Ltd. Competition Team Ireland Limited Group Sales 1,056,118 40 90 days Note 1 Note 1 651 -
Best Ever Industries Ltd. Futaihua Industrial (Shenzhen) Group Sales 4,439,188 20 60 days Note 1 Note 1 1,488,780 25 Limited Best Ever Industries Ltd. HongFuJin Precision Electronics Group Sales 2,420,037 11 60 days Note 1 Note 1 369,269 6 (ChengDu) Limited Best Ever Industries Ltd. HongFuJin Precision Electronics Group Sales 4,783,401 22 60 days Note 1 Note 1 1,587,327 27 (ZhenZhou) Limited Best Ever Industries Ltd. Foxconn Precision Electronics Group Sales 133,603 1 60 days Note 1 Note 1 48,268 1 (Taiyuan) Co., Ltd. Best Leap Enterprises Limited Competition Team Technologies Ltd. Group Sales 704,223 - 90 days Note 1 Note 1 - -
Best Leap Enterprises Limited Fusing International Inc. Pte. Ltd. Group Sales 5,365,886 1 90 days Note 1 Note 1 337,796 -
Best Leap Enterprises Limited Futaihua Industrial (Shenzhen) Group Sales 3,755,989 1 90 days Note 1 Note 1 989,482 1 Limited
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Heroic Legend Enterprises Ltd. Hongfujin Precision Industry Group Subcontract $ 352,356 2 30 days Note 1 Note 1$ 36,968 - (Shenzhen) Co., Ltd. Revenue Skilltop Limited Foxconn Image & Printing Product Group Sales 1,643,532 98 45 days Note 1 Note 1 1,706,605 100 Pte. Ltd. Tripleheads International Ltd. Competition Team Ireland Limited Group Sales 727,929 65 90 days Note 1 Note 1 164,565 30 Hongfutai Precision Electrons FuTaiJing Precision Electrons Group Sales 297,772 1 90 days Note 1 Note 1 236,478 2 (Yantai) Co., Ltd. (Yantai) Co., Ltd. Hongfutai Precision Electrons Hongfujin Precision Industry Group Sales 178,926 - 30 days Note 1 Note 1 117,984 1 (Yantai) Co., Ltd. (Wuhan) Co., Ltd. Hongfutai Precision Electrons Hongfujin Precision Industry Group Sales 4,211,381 8 30 days Note 1 Note 1 1,468,086 15 (Yantai) Co., Ltd. (Yantai) Co., Ltd. Hongfutai Precision Electrons Universal Field International Limited Group Sales 24, 362,629 43 30 days Note 1 Note 1 2,267,737 23 (Yantai) Co., Ltd. Hongfutai Precision Electrons YanTai FuHuaDa Precision Group Sales 1,145,804 2 90 days Note 1 Note 1 921,351 9 (Yantai) Co., Ltd. Electronics Limited Hongfutai Precision Electrons Foxconn Technology PTE. Ltd. Affiliates Purchase 196, 377 - 90 days Note 1 Note 1( 47,768) ( 1) (Yantai) Co., Ltd. Hongfutai Precision Electrons Pan-International Industrial Co. Affiliates Purchase 423,268 1 90 days Note 1 Note 1( 126,147) ( 1) (Yantai) Co., Ltd. Franklin Management Ltd. Hongfujin Precision Industry Group Sales 410,698 2 90 days Note 1 Note 1 10,601 - (Shenzhen) Co., Ltd. Foxconn CZ S. R. O. Foxconn Global Services Division Group Sales 113,516 - 45 days Note 1 Note 1 15,056 - S. R. O. Foxconn CZ S. R. O. Foxconn Rus LLC Group Sales 1,286, 769 1 45 days Note 1 Note 1 121,377 1 Foxconn CZ S. R. O. Foxconn TR Teknoloji San. Ltd. Sti. Group Sales 141,450 - 45 days Note 1 Note 1 389,296 4 Foxconn CZ S. R. O. CyberTAN Technology Inc. Affiliates Purchase 642,413 2 20 days Note 1 Note 1( 56,315) - Foxconn CZ S. R. O. Foxconn Technology PTE. Ltd. Affiliates Purchase 136,677 - 45 days Note 1 Note 1( 14,822) - Foxconn Global Services Division Foxconn CZ S. R. O. Group Sales 492,482 85 45 days Note 1 Note 1 110,219 61 S. R. O. Fujin Precision Industrial (Jincheng) FIH Precision Electronics (Lang Fang) Group Sales 300,556 1 90 days Note 1 Note 1 187,526 3 Co., Ltd. Co., Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Fujin Precision Industrial (Jincheng) Hongfujin Precision Industry Group Sales$ 597,844 3 90 days Note 1 Note 1$ 371,247 7 Co., Ltd. (Shenzhen) Co., Ltd. Fujin Precision Industrial (Jincheng) Futaihua Industrial (Shenzhen) Group Sales 2,060,010 10 90 days Note 1 Note 1 93,265 2 Co., Ltd. Limited Fujin Precision Industrial (Jincheng) FuTaiHua Precision Electronics Group Sales 348,761 2 90 days Note 1 Note 1 84,370 2 Co., Ltd. (ZhenZhou) Limited Fujin Precision Industrial (Jincheng) HongFuJin Precision Electronics Group Sales 11,190,578 52 90 days Note 1 Note 1 561,939 10 Co., Ltd. (ZhenZhou) Limited Fujin Precision Industrial (Jincheng) Fast Victor Limited Group Sales 2,334,485 11 90 days Note 1 Note 1 1,568,215 28 Co., Ltd. Fujin Precision Industrial (Jincheng) WWW (Jin Cheng) Co., Ltd. Group Sales 446,960 3 90 days Note 1 Note 1 866,740 15 Co., Ltd. Fujin Precision Industrial (Jincheng) MWM Co., Ltd. Group Sales 575,858 3 90 days Note 1 Note 1 765,607 14 Co., Ltd. Fujin Precision Industrial (Jincheng) Foxconn Precision Electronics Group Sales 172,768 1 90 days Note 1 Note 1 155,279 3 Co., Ltd. (Taiyuan) Co., Ltd. Fujin Precision Industrial (Jincheng) FuTaiHua Precision Electronics Group Sales 1,270,577 6 90 days Note 1 Note 1 427,749 8 Co., Ltd. (JiYuan) Limited Fujin Precision Industrial (Jincheng) Hon Fujin Precision Industry Affiliates Sales 150,488 1 90 days Note 1 Note 1 104,000 2 Co., Ltd. (Taiyuan) Co., Ltd. Fujin Precision Industrial (Jincheng) Hon Fujin Precision Industry Affiliates Purchase 760,968 10 90 days Note 1 Note 1( 352,431) ( 11) Co., Ltd. (Taiyuan) Co., Ltd. Hongzhun Precision Tooling Hongfujin Precision Industry Group Sales 151,107 2 90 days Note 1 Note 1 72,387 1 (Kunshan) Co., Ltd. (Shenzhen) Co., Ltd. Hongzhun Precision Tooling Fuding Electronical Technology Group Sales 1,488,663 24 60 days Note 1 Note 1 615,351 6 (Kunshan) Co., Ltd. (Jiashan) Co., Ltd. Hongzhun Precision Tooling Kangzhun Electronic Technology Group Sales 576,342 9 90 days Note 1 Note 1 5,866,240 58 (Kunshan) Co., Ltd. (Kunshan) Co., Ltd. Hongzhun Precision Tooling Fuxiang Precision Industrial Group Sales 2,585,239 42 90 days Note 1 Note 1 2,252,284 22 (Kunshan) Co., Ltd. (Kunshan) Hongzhun Precision Tooling Hongfujin Precision Industry (Yantai) Group Sales 102,470 2 30 days Note 1 Note 1 7,364 - (Kunshan) Co., Ltd. Co., Ltd. Hongzhun Precision Tooling Honfujin Precision Electronics Group Sales 196,784 3 30 days Note 1 Note 1 124,674 1 (Kunshan) Co., Ltd. (Chongqing) Co., Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Hongzhun Precision Tooling HongFuJin Precision Electronics Group Sales$ 199,982 3 90 days Note 1 Note 1$ 70,367 1 (Kunshan) Co., Ltd. (ChengDu) Limited Shenzhen Fuhongjie Technology FIH (Hong Kong) Limited Group Sales 321,109 31 30 days Note 1 Note 1 86,869 55 Service Co., Ltd. Shenzhen Fuhongjie Technology Carston Ltd. Group Subcontract 721,315 69 30 days Note 1 Note 1 72,263 45 Service Co., Ltd. Revenue Jizhun Precision Industry Hongfujin Precision Industry Group Sales 1,574,528 43 90 days Note 1 Note 1 454,716 32 (Huizhou) Co., Ltd. (Shenzhen) Co., Ltd. Jizhun Precision Industry Glorious Prospect Enterprises Ltd. Group Sales 339,15 4 9 90 days Note 1 Note 1 181,040 13 (Huizhou) Co., Ltd. Jizhun Precision Industry Futaihua Industrial (Shenzhen) Group Sales 151,225 4 90 days Note 1 Note 1 19,269 1 (Huizhou) Co., Ltd. Limited Jizhun Precision Industry HongFuJing Precision Electronics Group Sales 112,797 3 60 days Note 1 Note 1 74,122 5 (Huizhou) Co., Ltd. (TianJin) Co., Ltd. PCE Paragon Solutions (Mexico) Ingrasys Technology Co., Ltd. Group Sales 273,512 47 30 days Note 1 Note 1 20,811 55 S.A. De C.V. Shenzhen Fertile Plan International NanNing FuGui Precision Industrial Group Sales 111,067 12 90 days Note 1 Note 1 47,202 9 Logistics Co., Ltd. Co., Ltd. Shenzhen Fertile Plan International HongFuJin Precision Electronics Group Sales 175,938 19 90 days Note 1 Note 1 179,361 34 Logistics Co., Ltd. (ZhenZhou) Limited Fuzhun Precision Tooling (Huaian) Fuyu Electronical Technology Group Sales 405,386 61 30 days Note 1 Note 1 613,776 71 Co., Ltd. (Huaian) Co., Ltd. Fuzhun Precision Tooling (Huaian) Huaian Fulitong Trading Co., Ltd. Group Sales 253,060 38 30 days Note 1 Note 1 239,460 28 Co., Ltd. Fuyu Electronical Technology Success Rise Enterprises Ltd. Group Subcontract 7,455,433 80 30 days Note 1 Note 1 589,225 19 (Huaian) Co., Ltd. Revenue Fuyu Electronical Technology New Beyond Maximum Industrial Group Subcontract 1,922,382 20 30 days Note 1 Note 1 2,263,221 72 (Huaian) Co., Ltd. Limited Revenue PCE Paragon Solutions (USA) Inc. PCE Paragon Solutions Kft. Group Sales 104,286 30 60 days Note 1 Note 1 20,205 15
Funing Precision Component FIH (Hong Kong) Limited Group Sales 213,382 3 45 days Note 1 Note 1 38,822 3 Co., Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Hongfujin Precision Industry Top Step Enterprise Limited Group Sales$ 97,304,623 96 60 days Note 1 Note 1$ 5,121,574 78 (Wuhan) Co., Ltd. Hongfujin Precision Industry Fu You Wan De Trading Co., Ltd. Group Sales 161,404 - 120 days Note 1 Note 1 120,969 2 (Wuhan) Co., Ltd. Hongfujin Precision Industry Foxconn Technology PTE. Ltd. Affiliates Purchase 969, 021 1 30 days Note 1 Note 1( 329,733) ( 2) (Wuhan) Co., Ltd. Hongfujin Precision Industry Foxconn Technology Co., Ltd. Affiliates Purchase 844, 911 1 90 days Note 1 Note 1( 236,409) ( 1) (Wuhan) Co., Ltd. Hongfujin Precision Industry Pan-International Industrial Co. Affiliates Purchase 665,493 1 90 days Note 1 Note 1( 107,124) ( 1) (Wuhan) Co., Ltd. Hongfujin Precision Industry IRIS World Enterprises Limited Affiliates Purchase 2, 220,405 2 90 days Note 1 Note 1( 696,524) ( 4) (Wuhan) Co., Ltd. Hongfujin Precision Industry (Yantai) FuTaiJing Precision Electrons Group Sales 137,223 - 60 days Note 1 Note 1 97,383 - Co., Ltd. (Yantai) Co., Ltd. Hongfujin Precision Industry (Yantai) Competition Team Technology Pte. Group Sales 418,284 - 30 days Note 1 Note 1 44,796 - Co., Ltd. Ltd. Hongfujin Precision Industry (Yantai) Hongfutai Precision Electrons Group Sales 645,538 - 90 days Note 1 Note 1 109,318 - Co., Ltd. (Yantai) Co., Ltd. Hongfujin Precision Industry (Yantai) Full Profit International Limited Group Sales 724,124 - 30 days Note 1 Note 1 110,760 - Co., Ltd. Hongfujin Precision Industry (Yantai) Universal Field International Limited Group Sales 93, 749,870 59 30 days Note 1 Note 1 26,458,911 79 Co., Ltd. Hongfujin Precision Industry (Yantai) Foxconn Precision Electronics Group Sales 297,083 - 90 days Note 1 Note 1 19,670 - Co., Ltd. (Yan Tai) Co., Ltd. Hongfujin Precision Industry (Yantai) YanTai FuHuaDa Precision Group Sales 6,109,575 4 90 days Note 1 Note 1 2,197,252 7 Co., Ltd. Electronics Limited Hongfujin Precision Industry (Yantai) Premier Image Technology (China) Group Sales 339,355 - 90 days Note 1 Note 1 84,327 - Co., Ltd. Ltd. Hongfujin Precision Industry (Yantai) Foxconn Technology Co., Ltd. Affiliates Sales 45,396, 163 29 30 days Note 1 Note 1 3,511,768 10 Co., Ltd. Hongfujin Precision Industry (Yantai) Foxconn Technology PTE. Ltd. Affiliates Purchase 257, 296 - 90 days Note 1 Note 1( 39,785) - Co., Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Hongfujin Precision Industry (Yantai) Pan-International Industrial Co. Affiliates Purchase $ 1,963,768 1 90 days Note 1 Note 1($ 538,757) ( 1) Co., Ltd. Hongfujin Precision Industry (Yantai) IRIS World Enterprises Limited Affiliates Purchase 78 4,945 1 90 days Note 1 Note 1( 418,992) ( 1) Co., Ltd. Falcon Precision Trading Limited Fusing International Inc. Pte. Ltd. Group Sales 9,068,900 3 45 days Note 1 Note 1 2,025,782 5
Falcon Precision Trading Limited Futaihua Industrial (Shenzhen) Group Sales 147,136 - 90 days Note 1 Note 1 2,909 - Limited Universal Field International Limited Hongfutai Precision Electrons Group Sales 130,503 - 90 days Note 1 Note 1 37,852 - (Yantai) Co., Ltd. Universal Field International Limited Hongfujin Precision Industry Group Sales 190,488 - 30 days Note 1 Note 1 63,786 - (Yantai) Co., Ltd. Top Step Enterprise Limited Hongfujin Precision Industry (Wuhan) Group Sales 1,219,194 1 45 days Note 1 Note 1 259,624 2 Co., Ltd. Foxconn Technology CZ S. R. O. Foxconn CZ S. R. O. Group Sales 108,780 99 45 days Note 1 Note 1 49,267 99 Foxconn RUS LLC Foxconn CZ S. R. O. Group Sales 131,80 6 99 45 days Note 1 Note 1 19,289 100 Fugion Material Technology Fu Ding Precision Component Group Sales 849,752 13 90 days Note 1 Note 1 57,267 38 (Shenzhen) (Shenzhen) Co., Ltd. Fugion Material Technology FuDing(ZhengZhou) Precision Group Sales 423,955 7 90 days Note 1 Note 1 - - (Shenzhen) Industry Co., Ltd. Fugion Material Technology Fukui Precision Component Affiliates Sales 265,418 4 90 days Note 1 Note 1 5,055 3 (Shenzhen) (Shenzhen) Co., Ltd. Huaian Fulitong Trading Co., Ltd. Foxconn Electronic Industrial Group Sales 154,136 9 30 days Note 1 Note 1 106,801 27 Develpment (Kunshan) Co., Ltd. Foxconn Image & Printing Product Fuhuajie Industrial (Shenzhen) Group Sales 123,037 - 30 days Note 1 Note 1 46,030 58 Pte. Ltd. Limited Foxconn Image & Printing Product Honfujin Precision Electronics Group Sales 603,723 1 60 days Note 1 Note 1 186,798 2 Pte. Ltd. (Chongqing) Co., Ltd. Futaihua Industrial (Shenzhen) FIH Precision Electronics (Lang Fang) Group Sales 353,593 - 90 days Note 1 Note 1 162,047 - Limited Co., Ltd. Futaihua Industrial (Shenzhen) Hongfujin Precision Industry Group Sales 471,821 - 90 days Note 1 Note 1 270,379 - Limited (Shenzhen) Co., Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Futaihua Industrial (Shenzhen) Best Leap Enterprises Limited Group Sales$ 647,231,630 94 90 days Note 1 Note 1$ 95,795,830 88 Limited Futaihua Industrial (Shenzhen) Fujin Precision Industrial (Jincheng) Group Sales 560,805 - 90 days Note 1 Note 1 114,009 - Limited Co., Ltd. Futaihua Industrial (Shenzhen) HongFuJin Precision Electronics Group Sales 5,084,793 1 90 days Note 1 Note 1 1,268,218 1 Limited (ChengDu) Limited Futaihua Industrial (Shenzhen) FuTaiHua Precision Electronics Group Sales 504,144 - 90 days Note 1 Note 1 212,662 - Limited (ChengDu) Limited Futaihua Industrial (Shenzhen) FuTaiHua Precision Electronics Group Sales 309,573 - 90 days Note 1 Note 1 49,264 - Limited (ZhenZhou) Limited Futaihua Industrial (Shenzhen) HongFuJin Precision Electronics Group Sales 10,257,502 2 90 days Note 1 Note 1 3,915,994 4 Limited (ZhenZhou) Limited Futaihua Industrial (Shenzhen) Foxconn Precision Electronics Group Sales 622,552 - 90 days Note 1 Note 1 435,001 - Limited (Taiyuan) Co., Ltd. Futaihua Industrial (Shenzhen) FuTaiHua Precision Electronics Group Sales 4,401,477 1 90 days Note 1 Note 1 3,380,274 3 Limited (JiYuan) Limited Futaihua Industrial (Shenzhen) Fuhong Precision Component Group Sales 799,841 - 90 days Note 1 Note 1 232,941 - Limited (Bac Giang) Limited Futaihua Industrial (Shenzhen) Foxconn CMMSG Industria De Group Sales 1,050,371 - 90 days Note 1 Note 1 448,589 - Limited Eletronicos Ltda. Futaihua Industrial (Shenzhen) Hon Fujin Precision Industry Affiliates Sales 330,248 - 90 days Note 1 Note 1 24,220 - Limited (Taiyuan) Co., Ltd. Futaihua Industrial (Shenzhen) Ruizhida Optoelectronics (Shenzhen) Affiliates Sales 267,484 - 90 days Note 1 Note 1 61,821 - Limited Limited Futaihua Industrial (Shenzhen) Innocom Technology (Shenzhen) Note 7 Purchase 207,540 - 90 days Note 1 Note 1 - - Limited Co., Ltd. Futaihua Industrial (Shenzhen) Hon Fujin Precision Industry Affiliates Purchase 691,443 - 90 days Note 1 Note 1( 292,809) - Limited (Taiyuan) Co., Ltd. Futaihua Industrial (Shenzhen) Foxconn Technology Pte. Ltd. Affiliates Purchase 508, 623 - 90 days Note 1 Note 1( 150,665) - Limited Futaihua Industrial (Shenzhen) Fuzhun Precision (Shenzhen) Industry Affiliates Purchase 567,861 - 90 days Note 1 Note 1( 11,945) - Limited Co., Ltd.
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Futaihua Industrial (Shenzhen) IRIS World Enterprises Limited Affiliates Purchase$ 7, 522,809 1 90 days Note 1 Note 1($ 3,069,896) ( 1) Limited Fuhuajie Industrial (Shenzhen) Skilltop Limited Group Sales 1,738,723 46 45 days Note 1 Note 1 885,212 57 Limited Fuhuajie Industrial (Shenzhen) Foxconn Image & Printing Product Group Sales 186,450 5 30 days Note 1 Note 1 - - Limited Pte. Ltd. Fuhuajie Industrial (Shenzhen) Honfujin Precision Electronics Group Sales 1,642,867 44 60 days Note 1 Note 1 580,122 38 Limited (Chongqing) Co., Ltd. Honfujin Precision Electronics HighTech Electronics Components Group Sales 115,097,147 93 60 days Note 1 Note 1 26,376,410 89 (Chongqing) Co., Ltd. Inc. Honfujin Precision Electronics Fujun Precision Electronics Group Sales 5,230,665 4 90 days Note 1 Note 1 1,645,899 6 (Chongqing) Co., Ltd. (Chongqing) Co., Ltd. Honfujin Precision Electronics Innocom Technology (Chongqing) Group Sales 321,523 - 90 days Note 1 Note 1 319,152 1 (Chongqing) Co., Ltd. Co., Ltd. Honfujin Precision Electronics Innolux Corporation Ltd. Note 7 Purchase 3,454,857 14 90 days Note 1 Note 1( 910,700) ( 4) (Chongqing) Co., Ltd. Honfujin Precision Electronics Hon Fujin Precision Industry Affiliates Purchase 160,934 1 30 days Note 1 Note 1( 54,259) - (Chongqing) Co., Ltd. (Taiyuan) Co., Ltd. Honfujin Precision Electronics Pan-International Industrial Co. Affiliates Purchase 377,230 1 90 days Note 1 Note 1( 110,590) ( 1) (Chongqing) Co., Ltd. Honfujin Precision Electronics IRIS World Enterprises Limited Affiliates Purchase 1, 716,598 7 90 days Note 1 Note 1( 697,254) ( 3) (Chongqing) Co., Ltd. Foxconn Precision Electronics FuTaiJing Precision Electrons Group Sales 311,826 11 60 days Note 1 Note 1 174,479 25 (Yan Tai) Co., Ltd. (Yantai) Co., Ltd. Foxconn Precision Electronics Hongfutai Precision Electrons Group Sales 180,523 6 90 days Note 1 Note 1 33,173 5 (Yan Tai) Co., Ltd. (Yantai) Co., Ltd. Foxconn Precision Electronics Hongfujin Precision Industry Group Sales 184,098 7 90 days Note 1 Note 1 19,790 3 (Yan Tai) Co., Ltd. (Yantai) Co., Ltd. Foxconn Precision Electronics YanTai FuHuaDa Precision Group Sales 1,311,869 47 90 days Note 1 Note 1 342,450 48 (Yan Tai) Co., Ltd. Electronics Limited Foxconn Precision Electronics Pan-International Industrial Co. Affiliates Purchase 106,665 5 90 days Note 1 Note 1( 34,208) ( 5) (Yan Tai) Co., Ltd.
221 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
Chongqingshi Futaitong Logistics Honfujin Precision Electronics Group Sales$ 832,040 71 60 days Note 1 Note 1$ 433,365 88 Limited (Chongqing) Co., Ltd. Chongqingshi Futaitong Logistics Chongqing Hongdaofu Technology Affiliates Sales 222,054 19 60 days Note 1 Note 1 58,275 12 Limited Co., Ltd. HongFuJing Precision Electronics Jizhun Precision Industry (Huizhou) Group Sales 112,797 - 60 days Note 1 Note 1 74,122 1 (TianJin) Co., Ltd. Co., Ltd. HongFuJing Precision Electronics Profit New Limited Group Sales 33,603,528 84 90 days Note 1 Note 1 3,077,652 86 (TianJin) Co., Ltd. FuXun Tong Trading(ShenZhen) Efeihu (Beijing) E-commerce Ltd. Group Sales 112,618 3 30 days Note 1 Note 1 465 - Co., Ltd. HongFuJin Precision Electronics Falcon Precision Trading Limited Group Sales 336,452, 090 88 90 days Note 1 Note 1 19,575,624 57 (ChengDu) Limited HongFuJin Precision Electronics Futaihua Industrial (Shenzhen) Group Sales 22,985,707 6 90 days Note 1 Note 1 13,505,002 40 (ChengDu) Limited Limited HongFuJin Precision Electronics Foxconn CMMSG Industria De Group Sales 626,333 - 90 days Note 1 Note 1 370,399 1 (ChengDu) Limited Eletronicos Ltda. HongFuJin Precision Electronics Foxconn Technology Pte. Ltd. Affiliates Purchase 292, 816 - 90 days Note 1 Note 1( 105,836) - (ChengDu) Limited HongFuJin Precision Electronics IRIS World Enterprises Limited Affiliates Purchase 4, 293,720 1 90 days Note 1 Note 1( 1,606,155) ( 2) (ChengDu) Limited FuTaiHua Precision Electronics Hongfujin Precision Industry Group Sales 271,904 9 90 days Note 1 Note 1 112 - (ChengDu) Limited (Shenzhen) Co., Ltd. FuTaiHua Precision Electronics Futaihua Industrial (Shenzhen) Group Sales 154,018 5 90 days Note 1 Note 1 38,660 5 (ChengDu) Limited Limited FuTaiHua Precision Electronics HongFuJin Precision Electronics Group Sales 2,190,453 75 90 days Note 1 Note 1 630,085 78 (ChengDu) Limited (ChengDu) Limited FuTaiHua Precision Electronics Interface Technology (ChengDu) Affiliates Sales 163,098 6 30 days Note 1 Note 1 123,327 15 (ChengDu) Limited Co., Ltd. Wan Ma Ben Teng Trading Co., Wang Hui Trading Co., Ltd. Group Sales 122,225 58 30 days Note 1 Note 1 887 - Ltd. - China Jiaxin - China Shanghai FuDing (ZhengZhou) Precision HongFuJin Precision Electronics Group Sales 348,997 7 90 days Note 1 Note 1 197,155 20 Industry Co., Ltd. (ZhenZhou) Limited
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FuDing (ZhengZhou) Precision Foxconn Interconnect Technology Group Sales$ 897,480 17 60 days Note 1 Note 1$ 499,759 50 Industry Co., Ltd. Limited YanTai FuHuaDa Precision Universal Field International Limited Group Sales 5,8 10,465 29 30 days Note 1 Note 1 298,638 6 Electronics Limited YanTai FuHuaDa Precision FuXun Tong Trading (ShenZhen) Group Sales 806,910 4 30 days Note 1 Note 1 440,938 9 Electronics Limited Co., Ltd. YanTai FuHuaDa Precision Competition Team Ireland Limited Group Sales 199,404 1 90 days Note 1 Note 1 26,994 1 Electronics Limited YanTai FuHuaDa Precision HongFuJin Precision Electrons Group Sales 431,058 2 30 days Note 1 Note 1 304,798 6 Electronics Limited (HengYang) Co., Ltd. AnPinDa Precision Industry Glorious Prospect Enterprises Ltd. Group Sales 7,403, 342 88 90 days Note 1 Note 1 448,849 56 (HuiZhou) Co., Ltd. Chengdu Fu Tai Logistics Co., Ltd. HongFuJin Precision Electronics Group Sales 191,776 56 90 days Note 1 Note 1 97,019 73 (ChengDu) Limited System Integration Electronics Ambit Microsystem (Shanghai) Group Sales 422,489 7 60 days Note 1 Note 1 18,869 1 (Hangzhou) Co., Ltd. Co., Ltd. System Integration Electronics NanNing FuGui Precision Industrial Group Sales 598,191 10 60 days Note 1 Note 1 713,502 54 (Hangzhou) Co., Ltd. Co., Ltd. NanNing FuGui Precision Industrial Ambit Microsystem (Shanghai) 29,134 - Group Sales 278,750 1 90 days Note 1 Note 1 Co., Ltd. Co., Ltd. NanNing FuGui Precision Industrial Hongfujin Precision Industry 128,467 1 Group Sales 252,934 - 60 days Note 1 Note 1 Co., Ltd. (Shenzhen) Co., Ltd. NanNing FuGui Precision Industrial System Integration Electronics 714,216 5 Group Sales 598,789 1 30 days Note 1 Note 1 Co., Ltd. (Hangzhou) Co., Ltd. NanNing FuGui Precision Industrial Mega Well Limited Group Sales 26,085,368 50 30 days Note 1 Note 1 4,524,393 32 Co., Ltd. NanNing FuGui Precision Industrial IRIS World Enterprises Limited Affiliates Purchase 79 5,970 18 90 days Note 1 Note 1( 188,802) ( 1) Co., Ltd. FuTaiHua Precision Electronics Competition Team Technologies Ltd. Group Sales 451,800 2 90 days Note 1 Note 1 23,683 - (ZhenZhou) Limited FuTaiHua Precision Electronics Futaihua Industrial (Shenzhen) Group Sales 9,719,348 43 90 days Note 1 Note 1 2,129,458 39 (ZhenZhou) Limited Limited
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
FuTaiHua Precision Electronics HongFuJin Precision Electronics Group Sales$ 10,140,279 45 90 days Note 1 Note 1$ 2,683,352 49 (ZhenZhou) Limited (ZhenZhou) Limited FuTaiHua Precision Electronics Foxconn Precision Electronics Group Sales 2,401,127 10 90 days Note 1 Note 1 595,925 11 (ZhenZhou) Limited (Taiyuan) Co., Ltd. FuTaiHua Precision Electronics Hon Fujin Precision Industry Affiliates Purchase 433,928 42 90 days Note 1 Note 1( 181,826) ( 42) (ZhenZhou) Limited (Taiyuan) Co., Ltd. HongFuJin Precision Electronics Competition Team Technologies Ltd. Group Sales 781,437,954 93 90 days Note 1 Note 1 155,241,394 94 (ZhenZhou) Limited HongFuJin Precision Electronics Futaihua Industrial (Shenzhen) Group Sales 4,626,974 1 90 days Note 1 Note 1 - - (ZhenZhou) Limited Limited HongFuJin Precision Electronics FuDing (ZhengZhou) Precision Group Sales 116,088 - 90 days Note 1 Note 1 35,905 - (ZhenZhou) Limited Industry Co., Ltd. HongFuJin Precision Electronics FuTaiHua Precision Electronics Group Sales 1,017,798 - 90 days Note 1 Note 1 272,787 - (ZhenZhou) Limited (ZhenZhou) Limited HongFuJin Precision Electronics Foxconn Precision Electronics Group Sales 54,193,255 6 90 days Note 1 Note 1 9,889,313 6 (ZhenZhou) Limited (Taiyuan) Co., Ltd. HongFuJin Precision Electronics FuTaiHua Precision Electronics Group Sales 218,337 - 90 days Note 1 Note 1 18,515 - (ZhenZhou) Limited (JiYuan) Limited HongFuJin Precision Electronics Foxconn CMMSG Industria De Group Sales 621,417 - 90 days Note 1 Note 1 149,339 - (ZhenZhou) Limited Eletronicos Ltda. HongFuJin Precision Electronics Hon Fujin Precision Industry Affiliates Purchase 1,164,708 1 30 days Note 1 Note 1( 606,994) - (ZhenZhou) Limited (Taiyuan) Co., Ltd. HongFuJin Precision Electronics Foxconn Technology Pte. Ltd. Affiliates Purchase 492,160 - 90 days Note 1 Note 1( 263,240) - (ZhenZhou) Limited HongFuJin Precision Electronics Pan-International Industrial Co. Affiliates Purchase 153,416 - 90 days Note 1 Note 1( 70,813) - (ZhenZhou) Limited HongFuJin Precision Electronics IRIS World Enterprises Limited Affiliates Purchase 12,167,601 10 90 days Note 1 Note 1( 5,250,303) ( 2) (ZhenZhou) Limited ZhengZhou FuLianWang HongFuJin Precision Electronics Group Sales 1,020,505 95 90 days Note 1 Note 1 756,801 97 Electronic Technology Co., Ltd. (ZhenZhou) Limited Profit New Limited Ingrasys Technology Co., Ltd. Group Sales 431,911 1 90 days Note 1 Note 1 29,530 1 ChengDu XunFeng Trading Co., Ltd. HongFuJin Precision Electronics Group Sales 771,207 98 90 days Note 1 Note 1 52 100 (ChengDu) Limited
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
HongZhaoDa Integrated Innovative Smart Top International Ltd. Group Sales$ 1,499,325 100 90 days Note 1 Note 1$ 276,199 100 Service (KunShan) Co., Ltd. Competition Team Ireland Limited Honfujin Precision Electronics Group Sales 11,903,679 22 60 days Note 1 Note 1 1,945,950 28 (Chongqing) Co., Ltd. Competition Team Ireland Limited Fusing International Inc. Group Sales 384,252 1 60 days Note 1 Note 1 18,925 - Competition Team Ireland Limited Innolux Corporation Ltd. Note 7 Purchase 851,078 2 60 days Note 1 Note 1( 37,471) ( 1) WWW (Jin Cheng) Co., Ltd. Hongfujin Precision Industry Group Sales 991,365 47 90 days Note 1 Note 1 108,381 33 (Shenzhen) Co., Ltd. WWW (Jin Cheng) Co., Ltd. Fuhonyang Precision Industrial Group Sales 154,283 7 90 days Note 1 Note 1 61,861 19 (Shenzhen) Co., Ltd. WWW (Jin Cheng) Co., Ltd. Best Ever Industries Ltd. Group Sales 208,912 11 60 days Note 1 Note 1 48,557 15 WWW (Jin Cheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Group Sales 244,444 12 90 days Note 1 Note 1 39,441 12 Co., Ltd. MWM Co., Ltd. Best Ever Industries Ltd. Group Sales 4,6 05,730 100 30 days Note 1 Note 1 2,941,676 100 Foxconn Precision Electronics Futaihua Industrial (Shenzhen) Group Sales 7,985,974 5 90 days Note 1 Note 1 1,165,658 11 (Taiyuan) Co., Ltd. Limited Foxconn Precision Electronics HongFuJin Precision Electronics Group Sales 11,698,611 7 90 days Note 1 Note 1 4,069,987 37 (Taiyuan) Co., Ltd. (ZhenZhou) Limited Foxconn Precision Electronics Fast Victor Limited Group Sales 139,101,153 86 7 days Note 1 Note 1 3,816,436 35 (Taiyuan) Co., Ltd. Foxconn Precision Electronics Foxconn CMMSG Industria De Group Sales 3,281,731 2 90 days Note 1 Note 1 1,743,886 16 (Taiyuan) Co., Ltd. Eletronicos Ltda. Foxconn Precision Electronics Hon Fujin Precision Industry Affiliates Purchase 15,449,519 20 90 days Note 1 Note 1( 3,999,435) ( 11) (Taiyuan) Co., Ltd. (Taiyuan) Co., Ltd. Foxconn Precision Electronics IRIS World Enterprises Limited Affiliates Purchase 1,5 32,469 2 90 days Note 1 Note 1( 743,702) ( 2) (Taiyuan) Co., Ltd. Scientific-Atlanta De Mexico S. De Competition Team Ireland Limited Group Sales 2,543,380 100 30 days Note 1 Note 1 74,346 3 R. L. De C. V. FuTaiHua Precision Electronics FIH Precision Electronics Group Sales 620,636 2 90 days Note 1 Note 1 204,170 2 (JiYuan) Limited (Lang Fang) Co., Ltd. FuTaiHua Precision Electronics Fujin Precision Industrial (Jincheng) Group Sales 942,244 3 90 days Note 1 Note 1 - - (JiYuan) Limited Co., Ltd. FuTaiHua Precision Electronics Futaihua Industrial (Shenzhen) Group Sales 3,211,810 8 90 days Note 1 Note 1 2,275,891 14 (JiYuan) Limited Limited
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
FuTaiHua Precision Electronics HongFuJin Precision Electronics Group Sales$ 26,627,267 64 90 days Note 1 Note 1$ 1,538,629 9 (JiYuan) Limited (ZhenZhou) Limited FuTaiHua Precision Electronics Hon Fujin Precision Industry Affiliates Purchase 758,991 2 90 days Note 1 Note 1( 206,131) ( 2) (JiYuan) Limited (Taiyuan) Co., Ltd. Ambit Microsystems Corporation Ambit Micorsystems (Zhong Shan) Group Sales 2,384,608 48 60 days Note 1 Note 1 283,285 - Limited Corporation HongFuJin Precision Electrons Futaihua Industrial (Shenzhen) Group Sales 575,027 27 90 days Note 1 Note 1 264,983 30 (HengYang) Co., Ltd. Limited Innocom Technology (Chongqing) Fujun Precision Electronics Group Sales 447,475 92 60 days Note 1 Note 1 97,755 75 Co., Ltd. (Chongqing) Foxconn Interconnect Technology Hongfujin Precision Industry Group Sales 104,378 1 60 days Note 1 Note 1 104,800 1 Limited (Shenzhen) Co., Ltd. Foxconn Interconnect Technology Hongfujin Precision Industry Group Sales 726,935 5 90 days Note 1 Note 1 729,873 6 Limited (Wuhan) Co., Ltd. Foxconn Interconnect Technology Huaian Fulitong Trading Co., Ltd. Group Sales 143,864 1 30 days Note 1 Note 1 1,874 - Limited Foxconn Interconnect Technology Futaihua Industrial (Shenzhen) Group Sales 854,357 6 90 days Note 1 Note 1 857,810 7 Limited Limited Foxconn Interconnect Technology Honfujin Precision Electronics Group Sales 227,219 2 90 days Note 1 Note 1 228,138 2 Limited (Chongqing) Co., Ltd. Foxconn Interconnect Technology HongFuJin Precision Electronics Group Sales 527,775 4 90 days Note 1 Note 1 529,908 5 Limited (ChengDu) Limited Foxconn Interconnect Technology HongFuJin Precision Electronics Group Sales 1,433,823 10 90 days Note 1 Note 1 1,439,618 12 Limited (ZhenZhou) Limited Foxconn Interconnect Technology Foxconn Precision Electronics Group Sales 148,061 1 90 days Note 1 Note 1 148,659 1 Limited (Taiyuan) Co., Ltd. Foxconn Interconnect Technology Fuhong Precision Component Group Sales 436,609 3 90 days Note 1 Note 1 438,374 4 Limited (Bac Giang) Limited Foxconn Interconnect Technology New Ocean Precision Component Affiliates Purchase 305,327 - 30 days Note 1 Note 1( 306,561) ( 2) Limited (Ganzhou) Co., Ltd. Foxconn Interconnect Technology New Ocean Precision Component Affiliates Purchase 567,319 - 30 days Note 1 Note 1( 569,612) ( 4) Limited (Jiangxi) Co., Ltd. New Beyond Maximum Industrial Foxconn Interconnect Technology Group Sales 6,253,212 100 7 days Note 1 Note 1 1,953,840 100 Limited Limited NSG Technology Inc. Heroic Legend Enterprises Ltd. Group Sales 488,940 - 30 days Note 1 Note 1 - -
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Transaction Differences in transaction Notes / accounts receivable (payable) Percentage terms compared to third Relationship of total party transactions Percentage of total with the Purchases purchases Unit Credit notes / accounts Purchaser/seller Counterparty counterparty (sales) Amount (sales) Credit term price term Balance receivable (payable) Note
NSG Technology Inc. Competition Team Ireland Limited Group Sales$ 164,915 4 30 days Note 1 Note 1$ 44,564 13 Foxconn Japan Co., Ltd. Foxconn Technology Pte. Ltd. Affiliates Purchase 397,195 5 90 days Note 1 Note 1( 114,192) ( 10) Foxconn Singapore Pte. Ltd. FIH (Hong Kong) Limited Group Sales 107,709 1 60 days Note 1 Note 1 29,461 1 Foxconn Singapore Pte. Ltd. Foxconn TR Teknoloji San. Ltd. sti. Group Sales 3,100,601 32 90 days Note 1 Note 1 645,336 27 Premier Image Technology Hongfutai Precision Electrons Group Sales 279,366 2 90 days Note 1 Note 1 176,341 6 (China) Ltd. (Yantai) Co., Ltd. Premier Image Technology Hongfujin Precision Industry Group Sales 354,286 3 90 days Note 1 Note 1 56,132 2 (China) Ltd. (Yantai) Co., Ltd. Premier Image Technology Jumbo Rise Management Limited Group Sales 10,376,453 83 90 days Note 1 Note 1 1,708,139 54 (China) Ltd. Premier Image Technology Foxconn MOEBG Industria De Group Sales 422,626 3 90 days Note 1 Note 1 86,402 3 (China) Ltd. Eletronicos Ltda. Premier Image Technology Foxstar Technology Co., Ltd. Affiliates Sales 402,192 3 90 days Note 1 Note 1 2,391 - (China) Ltd. Premier Image Technology Innolux Corporation Ltd. Note 7 Purchase 108,188 1 60 days Note 1 Note 1 - - (China) Ltd. Premier Image Technology Pan International Industry Co., Ltd. Affiliates Purchase 331,731 4 90 days Note 1 Note 1( 21,051) ( 2) (China) Ltd. Foxconn Slovakia, SPOL. S R. O. KunShan Eson Precision Affiliates Purchase 467,219 5 60 days Note 1 Note 1( 89,266) ( 4) Engineering Co., Ltd. Fuhong Precision Component Funing Precision Component Co., Group Sales 175,703 - 60 days Note 1 Note 1 22,415 - (Bac Giang) Limited Ltd. Fuhong Precision Component Foxconn Interconnect Technology Group Sales 853,613 - 60 days Note 1 Note 1 857,062 1 (Bac Giang) Limited Limited Fenix Industria De Eletronicos Ltda. Foxconn CMMSG Industria De Group Sales 864,389 - 90 days Note 1 Note 1 36,669 - Eletronicos Ltda. Foxconn CMMSG Industria De FIH Do Brasil Industria E Comercio Group Sales 245,373 1 45 days Note 1 Note 1 113,899 - Eletronicos Ltda. De Eletronicos Ltda Note 1: The prices and terms to related parties were not significantly different from transaction with third parties, except for particular transactions with no similar transactions to compare with. For these transactions, the prices and terms were determined in accordance with mutual agreements. Note 2: The Group sold materials to the above related parties for processing and repurchased the finished goods. The sales amount of materials and repurchase price of finished goods were offset against each other and shown at net amount in the financial statements. Note 3: As of December 31, 2013, the prepayment of the Company is $105,064. Note 4: The Company’s chairman is a brother of the Company's chairman. Note 5: The counterparty is a subsidiary of SIO International Holdings Limited. Note 6: The Company’s chairman is a major shareholder of the counterparty. Note 7: The counterparty of the investee is an indirect subsidiary of Innolux Corporation.
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H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more: Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts Hon Hai Precision Industry Co., Ltd. Foxconn (Far East) Limited and subsidiaries Group$ 26,998,491 4 $ 2,281,734 Subsequent $ 8,276,729 $ - Collection Hon Hai Precision Industry Co., Ltd. Foxconn (Far East) Limited and subsidiaries Group 12,868,596 - 291,112 Subsequent 9,779,192 - Collection (Shown as other receivables) (Note 1) Hon Hai Precision Industry Co., Ltd. HongFuJin Precision Electronics (ZhenZhou) Group 192,610,653 - 36,169 Subsequent 47,960,534 - Limited Collection (Shown as other receivables) (Note 1) Hon Hai Precision Industry Co., Ltd. Futaihua Industrial (Shenzhen) Co., Ltd. Group 138,704,541 - - - 91,960,989 - (Shown as other receivables) (Note 1) Hon Hai Precision Industry Co., Ltd. HongFuJin Precision Electronics (ChengDu) Group 45,154,098 - - - 38,557,367 - Limited (Shown as other receivables) (Note 1) Hon Hai Precision Industry Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Group 20,428,467 - - - 6,239,922 - (Shown as other receivables) (Note 1) Hon Hai Precision Industry Co., Ltd. Universal Field International Limited Group 20,801,935 - 130 Subsequent 20,801,935 - Collection (Shown as other receivables) (Note 1) Hon Hai Precision Industry Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Group 14,595,251 - - - 1,602,122 - (Shown as other receivables) (Note 1) Hon Hai Precision Industry Co., Ltd. Honfujin Precision Electronics (Chongqing) Group 9,010,520 - - - 7,553,272 - Co., Ltd. (Shown as other receivables) (Note 1) Hon Hai Precision Industry Co., Ltd. Futaihua Precision Electronics (Jiyuan) Limited Group 6,698,805 - - - 1,764,182 - (Shown as other receivables) (Note 1)
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Hon Hai Precision Industry Co., Ltd. SIO International Inc. Note 2$ 7,685,873 3 $ 189,118 Subsequent $ 6,442,636 $ - Collection Hon Hai Precision Industry Co., Ltd. Ingrasys Technology Co., Ltd. Group 5,592,413 2 971,043 Subsequent 599,814 - Collection Hon Hai Precision Industry Co., Ltd. Foxconn Singapore (Pte) Ltd. Group 2,635,140 4 75,470 Subsequent 2,393,888 - Collection Hon Hai Precision Industry Co., Ltd. Fuhong Precision Component (Bac Giang) Limited Group 2,504,130 3 723,381 Subsequent 1,271,161 - Collection Hon Hai Precision Industry Co., Ltd. Foxconn Slovakia, SPOL S R. O. Group 2,338,735 5 6,416 Subsequent 2,231,877 - Collection Hon Hai Precision Industry Co., Ltd. Funing Precision Component Co., Ltd. Group 1,438,253 5 11,241 Subsequent 1,108,814 - Collection Hon Hai Precision Industry Co., Ltd. Ambit Microsystem (Shanghai) Co., Ltd. Group 1,273,460 8 5,064 Subsequent 901,800 - Collection Hon Hai Precision Industry Co., Ltd. Foxconn Japan Co., Ltd. Group 801,186 5 157 Subsequent 801,186 - Collection Hon Hai Precision Industry Co., Ltd. Foxconn MOEBG Industria De Eletronicos Ltda. Group 655,542 3 441 Subsequent 446,313 - Collection Hon Hai Precision Industry Co., Ltd. Ningbo Innolux Optoelectronics Ltd. Note 4 600,154 3 231 Subsequent 206,010 - Collection Hon Hai Precision Industry Co., Ltd. Interface Optoelectronics (Shenzhen) Co., Ltd. Affiliates 582,290 6 - - 520,894 -
Hon Hai Precision Industry Co., Ltd. CyberTAN Technology Inc. Affiliates 494,705 5 43,735 Subsequent 488,501 - Collection Hon Hai Precision Industry Co., Ltd. Nanhai Chi Mei Optoelectronics Ltd. Note 4 491,562 4 52 Subsequent 298,274 - Collection Hon Hai Precision Industry Co., Ltd. Innolux Corporation Note 3 337,151 3 26,985 Subsequent 182,880 - Collection Hon Hai Precision Industry Co., Ltd. Ennoconn Corporation Group 277,584 6 - - 265,522 -
Hon Hai Precision Industry Co., Ltd. New Ocean Precision Component (Jiangxi) Affiliates 274,356 3 1,450 Subsequent 196,948 - Co., Ltd. Collection
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Hon Hai Precision Industry Co., Ltd. Foxteq Australia Pty Ltd. Group$ 241,322 4 $ 3,347 Subsequent $ 148,850 $ - Collection Hon Hai Precision Industry Co., Ltd. Fukui Precision Component (Shenzhen) Co., Ltd. Affiliates 237,301 3 - - 183,814 -
Hon Hai Precision Industry Co., Ltd. Ningbo Innolux Technology Ltd. Note 4 206,732 4 238 Subsequent 116,636 - Collection Hon Hai Precision Industry Co., Ltd. Pan International Electronics (Malaysia) Affiliates 153,147 4 911 Subsequent 122,579 - Collection Hon Hai Precision Industry Co., Ltd. Foxconn Global Services Division S. R. O. Group 152,498 2 138,114 Subsequent - - Collection Hon Hai Precision Industry Co., Ltd. Foxconn RUS LLC Group 129,194 7 - - 129,194 -
Hon Hai Precision Industry Co., Ltd. Zenith Profits Co., Ltd. Affiliates 103,066 - - - 103,066 -
Ambit Microsystem (Shanghai) Co., Ltd. Amb Logistics Ltd. Group 5,476,513 9 - - - -
Ambit Microsystem (Shanghai) Co., Ltd. Amworld Microsystems (shanghai) Ltd. Group 194,252 8 - - - -
Ambit Microsystem (Shanghai) Co., Ltd. Foxconn Technology (India) Private Limited Group 134,398 1 88,060 Subsequent 15,744 - Collection Ingrasys Technology Inc. Ingrasys Technology USA Inc. Group 3,897,163 4 1,537,501 Subsequent 2,170,515 - Collection Ingrasys Technology Inc. PCE Paragon Solutions Kft. Group 147,580 7 6,996 Subsequent 146,162 - Collection Foxnum Technology Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Group 324,167 - - - 595 -
Honxun Electrical Industry (Hangzhou) Co., Ltd. FIH (Hong Kong) Limited Group 197,355 5 - - 56,196 -
Honxun Electrical Industry (Hangzhou) Co., Ltd. Nanning Futaihong Precision Industrial Co., Ltd. Group 309,791 2 - - - -
Shenzhen Fu Tai Hong Precision Industry Co., Ltd. FIH Precision Electronics (Lang Fang) Co., Ltd. Group 206,254 - - - 96 -
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Nanning Futaihong Precision Industrial Co., Ltd. Group $ 257,977 5 $ - -$ 7,175 $ -
Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Group 360,490 4 - - 117,699 -
Foxconn Precision Component (Beijing) Co., Ltd. FIH Precision Electronics (Lang Fang) Co., Ltd. Group 137,420 - - - 6,046 -
FIH (Tian Jin) Precision Industry Co., Ltd. FIH Precision Electronics (Lang Fang) Co., Ltd. Group 527,438 3 - - 41,228 -
FIH Mexico Industry S.A. DE C.V S&B Industry Inc. Group 153,998 7 - - 153,998 -
Futaijing Precision Electronics (Beijing) Co., Ltd. Foxconn Precision Component (Beijing) Co., Ltd. Group 162,964 1 - - 47,757 -
Futaijing Precision Electronics (Beijing) Co., Ltd. FIH Precision Electronics (Lang Fang) Co., Ltd. Group 222,348 1 - - 18,300 -
FIH Precision Electronics (Lang Fang) Co., Ltd. Foxconn Precision Component (Beijing) Co., Ltd. Group 271,886 3 - - 48,552 -
FIH Precision Electronics (Lang Fang) Co., Ltd. FIH (Hong Kong) Limited Group 3,514,088 7 - - 403,135 -
FIH (Hong Kong) Limited Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Group 185,466 5 - - 1,492 -
FIH (Hong Kong) Limited Hengyang Futaihong Precision Industry Co., Ltd. Group 4,801,120 3 - - 1,937,650 -
FIH (Hong Kong) Limited FuTaiJing Precision Electrons (Yantai) Co., Ltd. Group 1,002,488 3 - - 626,785 -
FIH (Hong Kong) Limited HongFuJin Precision Electronics (ZhenZhou) Group 747,159 4 - - 270 - Limited Nanning Futaihong Precision Industrial Co., Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Group 303,003 5 - - 22,717 -
Nanning Futaihong Precision Industrial Co., Ltd. Honxun Electrical Industry (Hangzhou) Co., Ltd. Group 310,124 2 - - - -
FuTaiJing Precision Electrons (Yantai) Co., Ltd. FIH (Hong Kong) Limited Group 1,128,181 - - - 1,128,181 -
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Hengyang Futaihong Precision Industry Co., Ltd. FIH (Hong Kong) Limited Group$ 5,356,863 3 $ - -$ 2,240,892 $ -
Carston Ltd. FIH (Hong Kong) Limited Group 200,610 3 - - - -
Carston Ltd. Best Ever Industries Ltd. Group 412,326 2 - - - -
Carston Ltd. General Interface Solution Limited Affiliates 298,255 2 - - - -
Carston Ltd. Lakers Trading Limited Note 4 1,470,352 - 945,598 Subsequent - - Collection Carston Ltd. Success Raise Corporation Group 106,952 - 87,928 Subsequent 894 - Collection Hongfujin Precision Industry (Shenzhen) Co., Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Group 159,522 4 1,362 Subsequent 80,870 - Collection Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hengyang Futaihong Precision Industry Co., Ltd. Group 180,373 3 - - - -
Hongfujin Precision Industry (Shenzhen) Co., Ltd. Carston Ltd. Group 850,331 4 - - - -
Hongfujin Precision Industry (Shenzhen) Co., Ltd. Fu Ding Precision Component (Shenzhen) Co., Ltd. Group 905,925 3 78 Subsequent 194,313 - Collection Hongfujin Precision Industry (Shenzhen) Co., Ltd. Fuhonyang Precision Industrial (Shenzhen) Co., Ltd. Group 112,019 - 60,252 Subsequent 2,710 - Collection Hongfujin Precision Industry (Shenzhen) Co., Ltd. Heroic Legend Enterprises Ltd. Group 1,601,410 - - - - -
Hongfujin Precision Industry (Shenzhen) Co., Ltd. Franklin Management Ltd. Group 2,339,258 7 - - - -
Hongfujin Precision Industry (Shenzhen) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Group 120,411 1 102,118 Subsequent - - Collection Hongfujin Precision Industry (Shenzhen) Co., Ltd. Futaihua Industrial (Shenzhen) Limited Group 2,057,419 2 486,021 Subsequent 654,790 - Collection Hongfujin Precision Industry (Shenzhen) Co., Ltd. HongFuJing Precision Electronics (TianJin) Group 138,088 1 102,813 Subsequent 112,931 - Co., Ltd. Collection
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Hongfujin Precision Industry (Shenzhen) Co., Ltd. HongFuJin Precision Electronics (ChengDu) Group$ 272,672 - $ 16,286 Subsequent $ 255,717 $ - Limited Collection Hongfujin Precision Industry (Shenzhen) Co., Ltd. NanNing FuGui Precision Industrial Co., Ltd. Group 943,735 3 404,306 Subsequent 278,652 - Collection Hongfujin Precision Industry (Shenzhen) Co., Ltd. HongFuJin Precision Electronics (ZhenZhou) Group 556,634 1 312,870 Subsequent 381,064 - Limited Collection Hongfujin Precision Industry (Shenzhen) Co., Ltd. FuTaiHua Precision Electronics (JiYuan) Limited Group 364,807 1 327,168 Subsequent 73,975 - Collection Fu Ding Precision Component (Shenzhen) Co., Ltd. Beyond Maximum Industrial Ltd. Group 129,101 6 - - 128,191 -
Fu Ding Precision Component (Shenzhen) Co., Ltd. New Beyond Maximum Industrial Limited Group 1,752,784 2 - - - -
Champ Tech Optical (FoShan) Corporation Foxconn Technology Pte. Ltd. Affiliates 614,763 4 - - 557,338 -
Champ Tech Optical (FoShan) Corporation Foxconn Technology Co., Ltd. Affiliates 210,349 6 - - - -
Fuding Electronical Technology (Jiashan) Co., Ltd. Fuxiang Precision Industrial (Kunshan) Co., Ltd. Group 460,010 2 - - 1,550 -
Fuding Electronical Technology (Jiashan) Co., Ltd. Futaihua Industrial (Shenzhen) Limited Group 1,421,878 4 - - 118,230 -
Fuhonyang Precision Industrial (Shenzhen) MWM Co., Ltd. Group 1,971,077 4 - - - - Co., Ltd. Kangzhun Electronic Technology (Kunshan) Fuding Electronical Technology (Jiashan) Group 419,896 2 23,827 Subsequent 231,836 - Co., Ltd. Co., Ltd. Collection Kangzhun Electronic Technology (Kunshan) Fuxiang Precision Industrial (Kunshan) Co., Ltd. Group 1,168,003 4 734,062 Subsequent 453,912 - Co., Ltd. Collection Kangzhun Electronic Technology (Kunshan) Qunkang Precision Component (Kunshan) Group 213,986 1 213,986 Subsequent - - Co., Ltd. Co., Ltd. Collection Kangzhun Electronic Technology (Kunshan) Tripleheads International Ltd. Group 942,207 - 207,358 Subsequent 741,058 - Co., Ltd. Collection Fuxiang Precision Industrial (Kunshan) Co., Ltd. Fuding Electronical Technology (Jiashan) Group 416,701 2 - - 214,282 - Co., Ltd.
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Fuxiang Precision Industrial (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Group$ 1,069,014 - $ 541,447 Subsequent $ 142,606 $ - Co., Ltd. Collection Fuxiang Precision Industrial (Kunshan) Co., Ltd. Fusing International Inc. Pte. Ltd. Group 544,018 4 - - 56,321 -
Fuxiang Precision Industrial (Kunshan) Co., Ltd. Futaihua Industrial (Shenzhen) Limited Group 118,150 - - - 70,187 -
Fuxiang Precision Industrial (Kunshan) Co., Ltd. Foxconn Technology Pte. Ltd. Affiliates 121,145 6 - - 63,454 -
Foxconn (Kun Shan) Computer Connector Foxconn Electronic Industrial Develpment Group 1,583,778 - 1,562,912 Subsequent 406,772 - Co., Ltd. (Kunshan) Co., Ltd. Collection Foxconn (Kun Shan) Computer Connector New Beyond Maximum Industrial Limited Group 814,710 6 - - - - Co., Ltd. Hongye Precision Component (Kunshan) Co., Ltd. FuXun Tong Trading (ShenZhen) Co., Ltd. Group 1,067,982 5 - - 776,217 -
Foxconn Electronic Industrial Develpment Foxconn (Kun Shan) Computer Connector Group 4,343,734 2 1,932,907 Subsequent 1,037,133 - (Kunshan) Co., Ltd. Co., Ltd. Collection Competition Team Technologies Ltd. HongFuJin Precision Electronics (ZhenZhou) Group 4,613,149 3 - - 817,818 - Limited HighTech Electronics Components Inc. Foxconn Image & Printing Product Pte. Ltd. Group 4,842,123 4 - - - -
HighTech Electronics Components Inc. Honfujin Precision Electronics (Chongqing) Group 4,394,985 - 150,692 Subsequent 108,712 - Co., Ltd. Collection HighTech Electronics Components Inc. Fusing International Inc. Group 4,007,905 2 1,285,654 Subsequent 1,217,456 - Collection HighTech Electronics Components Inc. Competition Team Ireland Limited Group 1,846,546 5 - - - -
HighTech Electronics Components Inc. Foxconn Japan Ltd. Group 255,850 1 48,301 Subsequent 48,301 - Collection Best Ever Industries Ltd. Futaihua Industrial (Shenzhen) Limited Group 1,488,780 4 - - 1,019,009 -
Best Ever Industries Ltd. HongFuJin Precision Electronics (ChengDu) Group 369,269 7 - - 369,269 - Limited
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Best Ever Industries Ltd. HongFuJin Precision Electronics (ZhenZhou) Group$ 1,587,327 4 $ - -$ 1,587,327 $ - Limited Best Leap Enterprises Limited Fusing International Inc. Pte. Ltd. Group 337,796 5 - - 327,910 -
Best Leap Enterprises Limited Futaihua Industrial (Shenzhen) Limited Group 989,482 - - - 807,251 -
Skilltop Limited Foxconn Image & Printing Product Pte. Ltd. Group 1,706,605 1 665,273 Subsequent 226,077 - Collection Tripleheads International Ltd. Competition Team Ireland Limited Group 164,565 3 - - 96,253 -
Hongfutai Precision Electrons (Yantai) Co., Ltd. FuTaiJing Precision Electrons (Yantai) Co., Ltd. Group 236,478 3 11,162 Subsequent 186,350 - Collection Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Industry (Wuhan) Co., Ltd. Group 117,984 2 - - - -
Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Industry (Yantai) Co., Ltd. Group 1,468,086 3 6,980 Subsequent 1,367,432 - Collection Hongfutai Precision Electrons (Yantai) Co., Ltd. Universal Field International Limited Group 2,267,737 4 605,921 Subsequent 2,267,737 - Collection Hongfutai Precision Electrons (Yantai) Co., Ltd. YanTai FuHuaDa Precision Electronics Limited Group 921,351 3 359,896 Subsequent 795,563 - Collection Foxconn CZ S. R. O. Foxconn Rus, LLC Group 121,377 - - - 121,377 -
Foxconn CZ S. R. O. Foxconn Tr Teknoloji San. Ltd. Sti. Group 389,296 - 321,584 Subsequent 3,477 - Collection Foxconn Global Services Division S. R. O. Foxconn CZ S. R. O. Group 110,219 6 4,127 Subsequent 47,999 - Collection Fujin Precision Industrial (Jincheng) Co., Ltd. FIH Precision Electronics (Lang Fang) Co., Ltd. Group 187,526 3 - - 38,099 -
Fujin Precision Industrial (Jincheng) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Group 371,247 2 - - 25,482 -
Fujin Precision Industrial (Jincheng) Co., Ltd. HongFuJin Precision Electronics (ZhenZhou) Group 561,939 - - - 232,534 - Limited
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Fujin Precision Industrial (Jincheng) Co., Ltd. Fast Victor Limited Group$ 1,568,215 3 $ - -$ - $ -
Fujin Precision Industrial (Jincheng) Co., Ltd. WWW (Jin Cheng) Co., Ltd. Group 866,740 1 349,433 Subsequent 766 - Collection Fujin Precision Industrial (Jincheng) Co., Ltd. MWM Co., Ltd. Group 765,607 1 196,012 Subsequent - - Collection Fujin Precision Industrial (Jincheng) Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Group 155,279 1 - - 178 -
Fujin Precision Industrial (Jincheng) Co., Ltd. FuTaiHua Precision Electronics (JiYuan) Limited Group 427,749 1 - - 45,750 -
Fujin Precision Industrial (Jincheng) Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Affiliates 104,000 - - - 39,726 -
Hongzhun Precision Tooling (Kunshan) Co., Ltd. Fuding Electronical Technology (Jiashan) Co., Ltd. Group 615,351 3 344,363 Subsequent 338,736 - Collection Hongzhun Precision Tooling (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Group 5,866,240 - 5,360,329 Subsequent 1,807 - Co., Ltd. Collection Hongzhun Precision Tooling (Kunshan) Co., Ltd. Fuxiang Precision Industrial (Kunshan) Co., Ltd. Group 2,252,284 2 813,883 Subsequent 396,614 - Collection Hongzhun Precision Tooling (Kunshan) Co., Ltd. Foxconn (Kunshan) Computer Connector Co., Ltd. Group 277,625 - 250,118 Subsequent 4,482 - Collection Hongzhun Precision Tooling (Kunshan) Co., Ltd. Foxconn Electronic Industrial Develpment Group 554,557 - 544,512 Subsequent - - (Kunshan) Co., Ltd. Collection Hongzhun Precision Tooling (Kunshan) Co., Ltd. Honfujin Precision Electronics (Chongqing) Group 124,674 3 105,518 Subsequent 64,066 - Co., Ltd. Collection Jizhun Precision Industry (Huizhou) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Group 454,716 3 83 Subsequent 228,048 - Collection Jizhun Precision Industry (Huizhou) Co., Ltd. Glorious Prospect Enterprises Ltd. Group 181,040 3 - - 35,399 -
Shenzhen Fertile Plan International Logistics HongFuJin Precision Electronics (ZhenZhou) Group 179,361 2 - - - - Co., Ltd. Limited Fuzhun Precision Tooling (Huaian) Co., Ltd. Fuyu Electronical Technology (Huaian) Co., Ltd. Group 613,776 1 547,287 Subsequent - - Collection
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Fuzhun Precision Tooling (Huaian) Co., Ltd. Huaian Fulitong Trading Co., Ltd. Group$ 239,460 1 $ 199,566 Subsequent $ - $ - Collection Fuyu Electronical Technology (Huaian) Co., Ltd. Success Rise Enterprises Ltd. Group 589,225 4 - - - -
Fuyu Electronical Technology (Huaian) Co., Ltd. New Beyond Maximum Industrial Limited Group 2,263,221 2 - - - -
Hongfujin Precision Industry (Wuhan) Co., Ltd. Top Step Enterprises Limited Group 5,121,574 - - - 5,121,574 -
Hongfujin Precision Industry (Wuhan) Co., Ltd. Fu You Wan De Trading Co., Ltd. Group 120,969 3 - - 55 -
Hongfujin Precision Industry (Yantai) Co., Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Group 109,318 1 109,318 Subsequent 25,039 - Collection Hongfujin Precision Industry (Yantai) Co., Ltd. Full Profit International Limited Group 110,760 4 31,844 Subsequent 81,074 - Collection Hongfujin Precision Industry (Yantai) Co., Ltd. Universal Field International Limited Group 26,458,911 6 12,787,250 Subsequent 26,458,911 - Collection Hongfujin Precision Industry (Yantai) Co., Ltd. YanTai FuHuaDa Precision Electronics Limited Group 2,197,252 2 - - 1,560,070 -
Hongfujin Precision Industry (Yantai) Co., Ltd. Foxconn Technology Co., Ltd. Affiliates 3,511,768 5 12,484 Subsequent 3,511,768 - Collection Falcon Precision Trading Limited Fusing International Inc. Pte. Ltd. Group 2,025,782 4 629,670 Subsequent 1,244,300 - Collection Top Step Enterprises Limited Hongfujin Precision Industry (Wuhan) Co., Ltd. Group 259,624 3 - - - -
Huaian Fulitong Trading Co., Ltd. Foxconn Electronic Industrial Development Group 106,801 1 84,075 Subsequent 2,059 - (Kunshan) Co., Ltd. Collection Foxconn Image & Printing Product Pte. Ltd. Honfujin Precision Electronics (Chongqing) Group 186,798 3 2,949 Subsequent 130,218 - Co., Ltd. Collection Futaihua Industrial (Shenzhen) Limited FIH Precision Electronics (Lang Fang) Co., Ltd. Group 162,047 3 199 Subsequent 94,965 - Collection Futaihua Industrial (Shenzhen) Limited Hongfujin Precision Industry (Shenzhen) Co., Ltd. Group 270,379 2 17,794 Subsequent 201,028 - Collection
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Futaihua Industrial (Shenzhen) Limited Best Leap Enterprises Limited Group$ 95,795,830 6 $ - -$ - $ -
Futaihua Industrial (Shenzhen) Limited Fujin Precision Industrial (Jincheng) Co., Ltd. Group 114,009 - 7,910 Subsequent - - Collection Futaihua Industrial (Shenzhen) Limited FuTaiHua Precision Electronics (ChengDu) Group 1,268,218 2 154,351 Subsequent 1,268,218 - Limited Collection Futaihua Industrial (Shenzhen) Limited FuTaiHua Precision Electronics (ChengDu) Group 212,662 5 17 Subsequent 209,639 - Limited Collection Futaihua Industrial (Shenzhen) Limited HongFuJin Precision Electronics (ZhenZhou) Group 3,915,994 2 723,873 Subsequent 1,305,687 - Limited Collection Futaihua Industrial (Shenzhen) Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Group 435,001 - - - - -
Futaihua Industrial (Shenzhen) Limited FuTaiHua Precision Electronics (JiYuan) Limited Group 3,380,274 2 3,363,784 Subsequent 2,187,741 - Collection Futaihua Industrial (Shenzhen) Limited Fuhong Precision Component (Bac Giang) Limited Group 232,941 1 42,617 Subsequent 72,335 - Collection Futaihua Industrial (Shenzhen) Limited Foxconn Brasil Industria E Comercio Ltda. Group 448,589 1 241,104 Subsequent 14,682 - Collection Fuhuajie Industrial (Shenzhen) Limited Skilltop Limited Group 885,212 1 - - 885,212 -
Fuhuajie Industrial (Shenzhen) Limited Honfujin Precision Electronics (Chongqing) Group 580,122 1 94,188 Subsequent 474,957 - Co., Ltd. Collection Honfujin Precision Electronics (Chongqing) HighTech Electronics Components Inc. Group 26,376,410 4 27,223 Subsequent 13,464,432 - Co., Ltd. Collection Honfujin Precision Electronics (Chongqing) Fujun Precision Electronics (Chongqing) Co., Ltd. Group 1,645,899 3 - - 436,184 - Co., Ltd. Honfujin Precision Electronics (Chongqing) Innocom Technology (Chongqing) Co., Ltd. Group 319,152 2 236,073 Subsequent 147,994 - Co., Ltd. Collection Foxconn Precision Electronics (Yan Tai) Co., Ltd. FuTaiJing Precision Electrons (Yantai) Co., Ltd. Group 174,479 4 9,162 Subsequent 26,174 - Collection Foxconn Precision Electronics (Yan Tai) Co., Ltd. YanTai FuHuaDa Precision Electronics Limited Group 342,450 5 12 Subsequent 340,961 - Collection
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Chongqingshi Futaitong Logistics Limited Honfujin Precision Electronics (Chongqing) Group$ 433,365 3 $ - -$ 199,014 $ - Co., Ltd. HongFuJing Precision Electronics (TianJin) Profit New Limited Group 3,077,652 - - - - - Co., Ltd. HongFuJin Precision Electronics (ChengDu) Falcon Precision Trading Limited Group 19,575,624 - - - 19,575,624 - Limited HongFuJin Precision Electronics (ChengDu) Futaihua Industrial (Shenzhen) Limited Group 13,505,002 3 2,741,611 Subsequent 4,059,202 - Limited Collection HongFuJin Precision Electronics (ChengDu) Foxconn Brasil Industria E Comercio Ltda. Group 370,399 1 - - - - Limited FuTaiHua Precision Electronics (ChengDu) HongFuJin Precision Electronics (ChengDu) Group 630,085 2 148,743 Subsequent 335,279 - Limited Limited Collection FuTaiHua Precision Electronics (ChengDu) Interface Technology (ChengDu) Co., Ltd. Affiliates 123,327 1 123,184 Subsequent 116,210 - Limited Collection FuDing (ZhengZhou) Precision Industry Co., Ltd. HongFuJin Precision Electronics (ZhenZhou) Group 197,155 2 66,663 Subsequent 1,989 - Limited Collection FuDing (ZhengZhou) Precision Industry Co., Ltd. FuTaiHua Precision Electronics (JiYuan) Limited Group 196,938 - 196,384 Subsequent 2,501 - Collection FuDing (ZhengZhou) Precision Industry Co., Ltd. Foxconn Interconnect Technology Limited Group 499,759 4 - - - -
YanTai FuHuaDa Precision Electronics Limited Universal Field International Limited Group 298,638 8 12,618 Subsequent 48,304 - Collection YanTai FuHuaDa Precision Electronics Limited FuXun Tong Trading (ShenZhen) Co., Ltd. Group 440,938 2 309,682 Subsequent 183,350 - Collection YanTai FuHuaDa Precision Electronics Limited HongFuJin Precision Electrons (HengYang) Co., Group 304,798 3 175,690 Subsequent 260,069 - Ltd. Collection AnPinDa Precision Industry (HuiZhou) Co., Ltd. Glorious Prospect Enterprises Ltd. Group 448,849 3 - - 60,070 -
System Integration Electronics (Hangzhou) Co., Ltd. NanNing FuGui Precision Industrial Co., Ltd. Group 713,502 2 - - 511,181 -
NanNing FuGui Precision Industrial Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Group 128,467 1 91,163 Subsequent 68,329 - Collection
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
NanNing FuGui Precision Industrial Co., Ltd. System Integration Electronics (Hangzhou) Co., Ltd. Group$ 714,216 2 $ - -$ 490,839 $ -
NanNing FuGui Precision Industrial Co., Ltd. Mega Well Limited Group 4,524,393 5 348,334 Subsequent 4,524,393 - Collection FuTaiHua Precision Electronics (ZhenZhou) Futaihua Industrial (Shenzhen) Limited Group 2,129,458 3 - - 1,368,636 - Limited FuTaiHua Precision Electronics (ZhenZhou) HongFuJin Precision Electronics (ZhenZhou) Group 2,683,352 4 160 Subsequent 2,194,721 - Limited Limited Collection FuTaiHua Precision Electronics (ZhenZhou) Foxconn Precision Electronics (Taiyuan) Co., Ltd. Group 595,925 3 421,391 Subsequent 482,933 - Limited Collection HongFuJin Precision Electronics (ZhenZhou) Competition Team Technologies Ltd. Group 155,241,394 6 1,580,290 Subsequent 50 - Limited Collection HongFuJin Precision Electronics (ZhenZhou) FuTaiHua Precision Electronics (ZhenZhou) Group 272,787 2 106,201 Subsequent 104,764 - Limited Limited Collection HongFuJin Precision Electronics (ZhenZhou) Foxconn Precision Electronics (Taiyuan) Co., Ltd. Group 9,889,313 5 673,199 Subsequent 673,199 - Limited Collection HongFuJin Precision Electronics (ZhenZhou) Foxconn Brasil Industria E Comercio Ltda. Group 149,339 5 211 Subsequent 211 - Limited Collection ZhengZhou FuLianWang Electronic Technology HongFuJin Precision Electronics (ZhenZhou) Group 756,801 - - - 80,085 - Co., Ltd. Limited HongZhaoDa Integrated Innovative Serice Smart Top International Ltd. Group 276,199 8 276,199 Subsequent 276,199 - (KunShan) Co., Ltd. Collection Competition Team Ireland Limited Honfujin Precision Electronics (Chongqing) Group 1,945,950 4 - - 1,896,883 - Co., Ltd. WWW (Jin Cheng) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Group 108,381 6 - - 108,381 -
MWM Co., Ltd. Best Ever Industries Ltd. Group 2,941,676 2 831,204 Subsequent 809,974 - Collection Foxconn Precision Electronics (Taiyuan) Co., Ltd. Futaihua Industrial (Shenzhen) Limited Group 1,165,658 2 - - 361,208 -
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Foxconn Precision Electronics (Taiyuan) Co., Ltd. HongFuJin Precision Electronics (ZhenZhou) Group$ 4,069,987 2 $ - -$ 1,572,752 $ - Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Fast Victor Limited Group 3,816,436 7 - - 3,816,436 -
Foxconn Precision Electronics (Taiyuan) Co., Ltd. Foxconn Brasil Industria E Comercio Ltda. Group 1,743,886 2 - - 1,572,752 -
FuTaiHua Precision Electronics (JiYuan) Limited FIH Precision Electronics (Lang Fang) Co., Ltd. Group 204,170 6 - - - -
FuTaiHua Precision Electronics (JiYuan) Limited Futaihua Industrial (Shenzhen) Limited Group 2,275,891 3 - - - -
FuTaiHua Precision Electronics (JiYuan) Limited HongFuJin Precision Electronics (ZhenZhou) Group 1,538,629 9 - - - - Limited Ambit Microsystems Corporation Limited Ambit Micorsystems (Zhong Shan) Corporation Group 283,285 8 4,936 Subsequent 226,471 - Collection HongFuJin Precision Electrons (HengYang) Co., Futaihua Industrial (Shenzhen) Limited Group 264,983 2 - - 227,548 - Ltd. Foxconn Interconnect Technology Limited Hongfujin Precision Industry (Shenzhen) Co., Ltd. Group 104,800 2 - - 34,524 -
Foxconn Interconnect Technology Limited Hongfujin Precision Industry (Wuhan) Co., Ltd. Group 729,873 2 - - 574,652 -
Foxconn Interconnect Technology Limited Futaihua Industrial (Shenzhen) Limited Group 857,810 2 - - - -
Foxconn Interconnect Technology Limited Honfujin Precision Electronics (Chongqing) Group 228,138 2 - - 144,675 - Co., Ltd. Foxconn Interconnect Technology Limited HongFuJin Precision Electronics (ChengDu) Group 529,908 2 - - - - Limited Foxconn Interconnect Technology Limited HongFuJin Precision Electronics (ZhenZhou) Group 1,439,618 2 - - - - Limited Foxconn Interconnect Technology Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Group 148,659 2 - - - -
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Overdue receivables Relationship Amount collected Allowance with the Balance as at Turnover subsequent to the for doubtful Creditor Counterparty counterparty December 31, 2013 rate Amount Action taken balance sheet date accounts
Foxconn Interconnect Technology Limited Fuhong Precision Component (Bac Giang) Limited Group$ 438,374 2 $ - -$ 1,069 $ -
New Beyond Maximum Industrial Limited Foxconn Interconnect Technology Limited Group 1,953,840 6 - - - -
Foxconn Singapore Pte. Ltd. Foxconn Tr Teknoloji San. Ltd. Sti. Group 645,336 1 49,699 Subsequent 160,328 - Collection Premier Image Technology (China) Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Group 176,341 3 31,302 Subsequent 40,580 - Collection Premier Image Technology (China) Ltd. Premier Image Techology (HK), Ltd. Group 1,106,275 - 1,106,275 Subsequent - - Collection Premier Image Technology (China) Ltd. Jumbo Rise Management Limited Group 1,708,139 3 - - 601,333 -
Jumbo Rise Management Limited Hongfujin Precision Industry (Yantai) Co., Ltd. Group 156,188 - 68,193 Subsequent 73,468 - Collection Fuhong Precision Component (Bac Giang) Foxconn Interconnect Technology Limited Group 857,062 2 447,201 Subsequent 315,686 - Limited Collection Foxconn Brasil Industria E Comercio Ltda. FIH do Brasil Industria e Comercio de Group 113,899 1 - - - - Eletronicos Ltda Foxconn Brasil Industria E Comercio Ltda. Futaihua Industrial (Shenzhen) Limited Group 123,932 - 123,932 Subsequent - - Collection
Note 1: Receivables from purchases of materials on behalf of the counterparty. Note 2: The counterparty is a subsidiary of SIO International Holdings Limited. Note 3: The Company’s chairman is a major shareholder of the counterparty. Note 4: The counterparty of the investee is an indirect subsidiary of Innolux Corporation.
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I. Derivative financial instruments undertaken during the year ended December 31, 2013: Please refer to Note 6(2).
J. Significant inter-company transactions during the year ended December 31, 2013:
Transaction
Percentage of consolidated total Number Relationship General ledger Transaction operating revenues or (Note a) Company name Counterparty (Note b) account Amount terms total assets (Note d) 0 Hon Hai Precision Industry Co., Ltd. Foxconn (Far East) Limited and subsidiaries 1 Purchase$ 365,963,594 Note c 9 0 Hon Hai Precision Industry Co., Ltd. Foxconn (Far East) Limited and subsidiaries 1 Other payables 34,547,347 Note c 1 0 Hon Hai Precision Industry Co., Ltd. Foxconn (Far East) Limited and subsidiaries 1 Accounts payable 73,123,413 Note c 3 0 Hon Hai Precision Industry Co., Ltd. Foxconn (Far East) Limited and subsidiaries 1 Accounts receivable 26,998,491 Note c 1 0 Hon Hai Precision Industry Co., Ltd. Best Leap Enterprises Limited 1 Purchase 612,504,729 Note c 15 0 Hon Hai Precision Industry Co., Ltd. Best Leap Enterprises Limited 1 Accounts payable 163,357,216 Note c 7 0 Hon Hai Precision Industry Co., Ltd. Carston Limited 1 Other payables 25,022,370 Note c 1 0 Hon Hai Precision Industry Co., Ltd. Competition Team Technologies Limited 1 Purchase 745,536,247 Note c 19 0 Hon Hai Precision Industry Co., Ltd. Competition Team Technologies Limited 1 Accounts payable 217,652,991 Note c 9 0 Hon Hai Precision Industry Co., Ltd. Falcon Precision Trading Limited 1 Purchase 325,435,258 Note c 8 0 Hon Hai Precision Industry Co., Ltd. Falcon Precision Trading Limited 1 Accounts payable 37,803,768 Note c 2 0 Hon Hai Precision Industry Co., Ltd. Foxconn CZ S.R.O. 1 Purchase 72,914,813 Note c 2 0 Hon Hai Precision Industry Co., Ltd. Universal Field International Limited 1 Purchase 122,692,944 Note c 3 0 Hon Hai Precision Industry Co., Ltd. Universal Field International Limited 1 Accounts payable 28,528,389 Note c 1 0 Hon Hai Precision Industry Co., Ltd. Futaihua Industrial (Shenzhen) Co., Ltd. 1 Other receivables 138,704,541 Note c 6 0 Hon Hai Precision Industry Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. 1 Other receivables 45,154,098 Note c 2 0 Hon Hai Precision Industry Co., Ltd. Hongfujin Precision Electronics (Zhengzhou) Co., Ltd. 1 Other receivables 192,610,653 Note c 8 1 Hongfujin Precision Industrial (Wuhan) Co., Ltd. Top Step Enterprises Limited 3 Sales 97,304,623 Note c 2 2 Hongfujin Precision Electrons (Yantai) Co., Ltd. Universal Field International Limited 3 Sales 93,749,870 Note c 2 2 Hongfujin Precision Electrons (Yantai) Co., Ltd. Universal Field International Limited 3 Accounts receivable 26,458,911 Note c 1 3 Futaihua Industrial (Shenzhen) Co., Ltd. Best Leap Enterprises Limited 3 Sales 647,231,630 Note c 16
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Transaction
Percentage of consolidated total Number Relationship General ledger Transaction operating revenues or (Note a) Company name Counterparty (Note b) account Amount terms total assets (Note d)
3 Futaihua Industrial (Shenzhen) Co., Ltd. Best Leap Enterprises Limited 3 Accounts receivable$ 95,795,830 Note c 4 4 Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hightech Electronics Components Inc. 3 Sales 115, 097,147 Note c 3 4 Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hightech Electronics Components Inc. 3 Accounts receivable 26,376,410 Note c 1 5 Hongfujin Precision Electronics (Chengdu) Co., Ltd. Falcon Precision Trading Limited 3 Sales 336,452,09 0 Note c 9 6 Foxconn Precision Electronics (Taiyuan) Co., Ltd. Fast Victor Limited 3 Sales 139,101,153 Note c 4 7 Hongfujin Precision Electronics (Zhengzhou) Co., Ltd. Competition Team Technologies Limited 3 Sales 78 1,437,954 Note c 20 7 Hongfujin Precision Electronics (Zhengzhou) Co., Ltd. Competition Team Technologies Limited 3 Account s receivable 155,241,394 Note c 7 7 Hongfujin Precision Electronics (Zhengzhou) Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd. 3 Sales 54,193,255 Note c 1
Note a: The information of transactions between the Company and the consolidated subsidiaries should be noted in “Number” column. 1. Number 0 represents the Company. 2. The consolidated subsidiaries are numbered in order from number 1. Note b: The transaction relationships with the counterparties are as follows: 1. The Company to the consolidated subsidiaries. 2. The consolidated subsidiaries to the Company. 3. The consolidated subsidiaries to another consolidated subsidiaries. Note c: The prices and terms to related parties were not significantly different from transactions with third parties, except for particular transactions with no similar transactions to compare with. For these transactions, the prices and terms were determined in accordance with mutual agreements. Note d: In calculating the ratio, the transaction amount is divided by consolidated total assets for balance sheet accounts and is divided by consolidated total revenues for income statement accounts. Note e: For balance sheet accounts, transactions exceeding 1% of the consolidated total assets should be disclosed; for income statement accounts, transactions exceeding 1% of the consolidated total revenue should be disclosed. All the transactions had been eliminated when preparing consolidated financial statements. Note f: Part of the above transactions with related parties were based on the financial statements of the company for the same period which was not audited by independent accountants.
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(2) Information on investees (not including investees in Mainland China)
Initial investment amount Shares held as at December 31, 2013 Net profit (loss) of Investment income the investee for (loss) recognised by Balance as at Balance as at the year ended the Company for the Main business December 31, December 31, Ownership December 31, year ended Investor Investee Location activities 2013 2012 Number of shares (%) Book value 2013 December 31, 2013 Note Hon Hai Precision Foxconn (Far East) Cayman Islands Investment holding$ 105,615,540 $ 85,352,589 4,063,144,784 100 $ 631,495,767 $ 59,600,534 $ 60,412,594 Note 1 Industry Co., Ltd. Limited Hon Hai Precision Hyield Venture Taiwan Investment holding 3,900,000 3,900,000 467,025,000 98 13,058,742 819,189 802,637 Note 1 Industry Co., Ltd. Capital Co., Ltd. Hon Hai Precision Bao Shin International Taiwan Investment holding 2,998,500 2,998,500 721,000,000 100 10,988,489 671,891 669,457 Note 1 Industry Co., Ltd. Investment Co., Ltd.
Hon Hai Precision Margini Holdings British Virgin Investment holding 8,904,952 8,904,952 275,890,000 100 10,079,906 1,539,843 1,558,438 Note 1 Industry Co., Ltd. Limited Islands Hon Hai Precision Ambit International British Virgin Investment holding 1,788,146 1,788,146 53,100,000 100 9,862,051 623,090 623,090 Note 1 Industry Co., Ltd. Ltd. Islands Hon Hai Precision Foxconn Holding Netherland Investment holding 6,486,934 6,486,934 107,723,409 100 8,814,986 1,536,162 1,534,225 Note 1 Industry Co., Ltd. B.V.-Netherland Hon Hai Precision Foxconn Technology Taiwan Manufacture and 481,782 481,782 130,450,145 10 6,867,875 7,011,205 700,251 Note 1, 3 Industry Co., Ltd. Co., Ltd. design of monitors Hon Hai Precision Foxconn Holding Ltd. British Virgin Investment holding 3,263,710 2,971,777 107,413,775 100 7,179,847 332,107 348,258 Note 1 Industry Co., Ltd. Islands Hon Hai Precision Hon Yuan Taiwan Investment holding 1,611,500 1,611,500 297,000,000 100 3,761,739 75,449 75,278 Note 1 Industry Co., Ltd. International Investment Co., Ltd.
Hon Hai Precision Hon Chi International Taiwan Investment holding 1,500,500 1,500,500 280,700,000 100 3,535,977 81,726 80,051 Note 1 Industry Co., Ltd. Investment Co., Ltd. Hon Hai Precision Foxconn Singapore Singapore Investment holding 1,661,610 1,661,610 53,037,545 100 3,027,913 406,360 406,521 Note 1 Industry Co., Ltd. Pte. Ltd.
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Initial investment amount Shares held as at December 31, 2013 Net profit (loss) of Investment income the investee for (loss) recognised by Balance as at Balance as at the year ended the Company for the Main business December 31, December 31, Ownership December 31, year ended Investor Investee Location activities 2013 2012 Number of shares (%) Book value 2013 December 31, 2013 Note
Hon Hai Precision Foxconn SA B.V. Netherland Investment holding$ 3,185,683 $ 3,185,683 72,163,188 98 $ 2,407,566 $ 88,881 $ 86,905 Note 1 Industry Co., Ltd. Hon Hai Precision Pan International Taiwan Manufacture and 2,042,398 2,042,398 107,240,054 21 2,265,309 488,904 57,201 Note 1, 2 Industry Co., Ltd. Industrial Corporation marketing of cables Hon Hai Precision Lin Yih International Taiwan Investment holding 904,411 904,411 96,900,000 100 1,025,235 15,861 14,764 Note 1 Industry Co., Ltd. Investment Co., Ltd. Hon Hai Precision Syntrend Creative Taiwan Retail of office 1,436,463 1,155,704 143,646,250 73 1,275,871 ( 115,562) ( 98,461) Note 1 Industry Co., Ltd. Park Co., Ltd. machinery and equipment and electronic appliances, and information software services. Hon Hai Precision Premier Image Hong Kong Purchase and the sales 22,311 22,311 1,404,936 2 155,587 ( 1,731,482) ( 28,223) Note 1, 5 Industry Co., Ltd. Technology (H.K) Ltd. of cameras and related parts
Hon Hai Precision Altus Technology Inc. Taiwan Manufacture, design 865,177 865,177 7,872,911 65 78,927 4,066 848 Note 1, 4 Industry Co., Ltd. and marketing of cellular phone, camera lens and sensors Hon Hai Precision Ambit Taiwan Mobile 6,000,000 - 600,000,000 99 5,948,263 ( 32,341) ( 8,216) Note 1 Industry Co., Ltd. Microsystem communications Corporation
Hon Hai Precision Others Others 163,446 163,446 - - 143,828 ( 78,258) ( 35,073) Note Industry Co., Ltd. 6,10
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Initial investment amount Shares held as at December 31, 2013 Net profit (loss) of Investment income the investee for (loss) recognised by Balance as at Balance as at the year ended the Company for the Main business December 31, December 31, Ownership December 31, year ended Investor Investee Location activities 2013 2012 Number of shares (%) Book value 2013 December 31, 2013 Note
Hyield, Hon Yuan, Foxsemicon Integrated Taiwan Manufacture of $ 448,110 $ 448,110 10,879,635 18 $ 237,099 $ 42,871 $ 36,730 Note 6 Bao Shin and Hon echnology Inc. semiconductor Chit machinery and sales of computer components Hyield, Hon Yuan, Foxconn Technology Taiwan Manufacture and 1,992,567 1,992,567 258,793,098 20 13,843,872 7,011,205 1,382,342 Note 6 Bao Shin and Hon Chi Co., Ltd. design of monitors Hon Yuan, Bao Shin, Pan International Taiwan Manufacture and 560,639 560,639 29,472,679 6 652,410 488,904 13,850 Note 6 Hon Chi and Hon Industrial Corporation marketing of cables Yiing Hyield, Hon Yuan, Altus Technology Inc. Taiwan Manufacture, 284 284 4,317,089 35 43,280 4,066 465 Note 6 Bao Shin, Lin Yih and marketing and design Hon Chi of cellular phone, camera lens and sensors Hyield Antec Electronic Taiwan Manufacture of cable, 970,000 970,000 60,010,000 100 361,531 ( 33,140) ( 31,003) Note 6 System Co., Ltd. electronic equipment and electron component of motor vehicles Hyield, Hon Yuan, CyberTAN Taiwan Manufacture, design 357,397 357,397 35,122,013 11 552,510 158,176 15,630 Note 6 Bao Shin, Lin Yih and Technology, Inc. and marketing of Hon Chi wireless network equipment Bao Shin and Hyield Ennoconn Corporation Taiwan Design and 299,206 299,206 29,418,649 49 605,832 371,827 176,702 Note 6 manufacture of single board computer, embedded board, industrial motherboard Hon Chi, Hon Yuan, Foxnum Technology Taiwan Manufacture and sales 464,736 464,736 46,473,600 85 1,110,325 83,405 ( 87,054) Note 6 and Bao Shin Co., Ltd. of machinery, computer and peripheral devices
247 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Initial investment amount Shares held as at December 31, 2013 Net profit (loss) of Investment income the investee for (loss) recognised by Balance as at Balance as at the year ended the Company for the Main business December 31, December 31, Ownership December 31, year ended Investor Investee Location activities 2013 2012 Number of shares (%) Book value 2013 December 31, 2013 Note
Hyield, Hon Yuan, G-TECH Taiwan Manufacture of glass, $ 1,669,704 $ 1,669,704 73,128,667 27 $ 2,575,294 ($ 1,289,992) ($ 313,439) Note 6 Bao Shin and Hon Chi Optoelectronics glass products and electronics components
Hyield Ingrasys Technology Taiwan Design, research, 250,705 250,705 45,410,000 100 1,435,954 446,828 451,664 Note 6 Inc. manufacture and sales of data storage and processor Hyield Burrage Capital Cayman Investment holding 441,300 441,300 15,000,000 100 514,384 ( 30,401) ( 30,401) Note 6 Healthcare Offshore Fund II, Ltd. Hyield, Hon Yuan, Fitipower Integrated Taiwan Manufacture of 585,000 585,000 45,450,167 34 649,064 123,628 40,450 Note 6 Bao Shin and Hon Chi Technology Inc. integrated circuit/semi- conductor machinery and sales of computer components Hyield, Hon Yuan, Others Others 1,470,444 985,692 - - 1,129,235 555,715 17,387 Note 6,8 Bao Shin and Hon Chi Note 1: The investment income recognized for this period had eliminated unrealized gain or loss on the transactions between the Company and its investees. Note 2: The Company and its subsidiaries, directly and indirectly, own 26.51% of Pan International Industrial Corporation’s outstanding shares. Note 3: The Company and the direct and indirect investee companies own 29.79% of Foxconn Technology Co., Ltd.’s outstanding shares. Note 4: The Company and the direct and indirect investee companies own 100% of Altus Technology Inc.’s outstanding shares. Note 5: The Company and the direct and indirect investee companies own 99.96% of Premier Image Technology (H.K) Ltd.’s outstanding shares. Note 6: Hyield Venture Capital Co., Ltd. is referred to as Hyield, Hon Chi International Investment Co., Ltd. is referred to as Hon Chi, Hon Yuan International Investment Co., Ltd. is referred to as Hon Yuan, Bao Shin International Investment Co., Ltd. is referred to as Bao Shin, and Lin Yih International Investment Co., Ltd. is referred to as Lin Yih. Note 7: Because the foreign holding investee companies prepare consolidated financial statements only, the disclosure of the company’s investments over which the Company has significant influence or control, directly or indirectly, is only disclosed to the level of the holding company. Note 8: Due to the amount is insignificant, combined disclosure is adopted.
248 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
(3)Information on investments in Mainland China
Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note Foxconn Precision Manufacturing of $ 2,050,928 Note 1 (2)$ - $ - $ - $ - $ 156,755 67.08$ 106,709 $ 17,030,016 $ - Note 2 Component (Beijing) Co., telecommunication cases Ltd. Fujin Precision Industry Manufacturing and 1,563,535 Note 1 (2) 149,050 - - 149,050 ( 4,916) 100( 4,916) 2,456,973 129,972 Note 2 (Shenzhen) Co., Ltd. processing of computer cases, computer peripherals, etc. Shenzhen Fu Tai Hong Manufacturing and 5,321,681 Note 1 (2) - - - - ( 159,918) 67.08( 108,862) 10,695,796 - Note 2 Precision Industry Co., marketing of computer Ltd. cases, micro ribbon connectors for terminals, etc. Foxconn Precision Manufacturing of 1,774,886 Note 1 (2) 89,430 - - 89,430 46,625 100 46,625 2,130,796 - Note 2 Component (Shenzhen) connectors, micro ribbon Co., Ltd. connectors for terminals, micro-computers, mouse cables, monitor cables, etc. Honxun Electrical Manufacturing and 3,779,908 Note 1 (2) - - - - ( 386,413) 67.08( 263,046) 5,839,820 - Note 2 Industry (Hangzhou) Co., marketing of computer Ltd. cases, micro ribbon connectors for terminals, etc.
249 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Hongzhun Precision Manufacturing and $ 447,150 Note 1 (2)$ - $ - $ - $ - $ 13,115 100$ 13,115 $ 689,515 $ - Note 2 Tooling (Shenzhen) Co., marketing of computer Ltd. cases and computer peripherals, etc.
Foxconn Computer Manufacturing of 1,329,526 Note 1 (2) 149,050 - - 149,050 911,418 100 911,418 6,319,527 212,843 Note 2 Connectors (Kunshan) connectors, micro ribbon Co., Ltd. connectors for terminals, micro-computers, mouse cables, monitor cables, etc. Fu Ding Precision Manufacturing and 1,430,880 Note 1 (2) - - - - 570,614 100 570,614 5,230,895 - Note 2 Component (Shenzhen) marketing of connectors, Co., Ltd. micro ribbon connectors for terminals, etc.
Hong Fujin Precision Manufacturing and 5,037,890 Note 1 (2) - - - - 3,322,246 100 3,322,246 69,125,856 1,043,946 Note 2 Industrial (Shenzhen) Co., marketing of computer Ltd. case and computer peripherals, etc. Foxconn Electronic Manufacturing and 3,696,440 Note 1 (2) - 1,669,360 - 1,669,360 29,430 100 29,430 5,316,571 - Note 2 Industrial Development marketing of computer (Kunshan) Co., Ltd. cases, micro ribbon connectors for terminals, etc. Futaije Science & Manufacturing and design 357,720 Note 1 (2) - - - - ( 7,420) 100( 7,420) 578,946 - Note 2 Technology Development of computer components (Shenzhen) Co., Ltd. keyboards, etc.
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Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Fuhon Precision Manufacturing and $ 342,815 Note 1 (2)$ - $ - $ - $ - ($ 19,632) 100($ 19,632) $ 1,415,133 $ 64,688 Note 2 Component (Shenzhen) marketing of connectors, Co., Ltd. micro ribbon connectors for terminals, etc.
Hongzhun Precision Manufacturing and 2,563,660 Note 1 (2) - - - - 770,842 100 770,842 14,122,541 81,083 Note 2 Tooling (Kunshan) Co., marketing of computer Ltd. cases Kangzhun Precision Manufacturing and 4,173,400 Note 1 (2) 864,490 - - 864,490 ( 854,151) 100( 854,151) 2,458,701 - Note 2 Tooling (Kunshan) Co., marketing of computer Ltd. components, computer peripherals, etc.
Futaikang Precision Manufacturing and 171,408 Note 1 (2) - - - - ( 2,638) 100( 2,638) 268,344 - Note 2 Computer (Shenzhen) marketing of connectors, Co., Ltd. micro ribbon connectors for terminals, etc.
Qunkang Precision Manufacturing and 178,860 Note 1 (2) - - - - ( 114,507) 100( 114,507) ( 17,148) - Note 2 Component (Kunshan) marketing of switching Co., Ltd. hub and router cases
Fujin Precision Industrial Manufacturing and 14,994,430 Note 1 (2) 4,501,310 5,962,000 - 10,463,310 110,195 100 110,195 21,791,569 - Note 2 (Jincheng) Co., Ltd. marketing of computer cases Honyeh Precision Manufacturing and 172,898 Note 1 (2) - - - - 38,095 100 38,095 500,865 43,225 Note 2 Component (Kunshan) marketing of computer Co., Ltd. components
251 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Fuhonyang Precision Manufacturing and $ 1,281,830 Note 1 (2)$ 1,281,830 $ - $ - $ 1,281,830 $ 341,358 100$ 341,358 $ 2,275,810 $ - Note 2 Industrial (Shenzhen) Co., marketing of connectors, Ltd. micro ribbon connectors for terminals, computer cases, etc. Foxway Precision Manufacturing and 372,625 Note 1 (2) - - - - 68,709 100 68,709 1,049,681 - Note 2 Industry (Hangzhou) Co., marketing of router Ltd. components
Hongfutai Precision Manufacturing and 4,411,880 Note 1 (2) - - - - ( 452,702) 100( 452,702) 11,746,630 - Note 2 Electrons (Yantai) Co., marketing of auto digital Ltd. signal process device and components Ambit Microsystems Manufacturing and 1,526,272 Note 1 (2) 730,345 - - 730,345 1,514,446 77.79 1,463,762 3,402,810 - Note 2 (Zhong Shan) marketing of power Corporation supplies Ambit Microsystems Manufacturing and 2,188,054 Note 1 (2) 1,371,260 - - 1,371,260 501,334 100 501,334 8,736,370 - Note 2 (Shanghai) Co., Ltd. marketing of power supplies, modems and ADSL devices Amlink (Shanghai) Ltd. Manufacturing and 596,200 Note 1 (2) 208,670 - - 208,670 29,117 44.81 13,047 535,650 - Note 2 marketing of power supplies, modems and ADSL devices Fuxian Precision Industry Manufacturing and 4,918,650 Note 1 (2) - 745,250 - 745,250 ( 793,877) 100( 793,877) 5,773,542 - Note 2 (Kunshan) Co., Ltd. marketing of computer case
252 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Dong Guan Hong Song Manufacturing and $ 298,100 Note 1 (2)$ - $ - $ - $ - $ 33,544 100$ 33,544 $ 428,084 $ - Note 2 Precision Component Co., marketing of keypad and Ltd. computer components
FIH (Tian Jin) Precision Manufacturing and 1,573,968 Note 1 (2) - - - - ( 967,760) 67.08( 658,791) ( 1,287,322) - Note 2 Industry Co., Ltd. marketing of wireless (Formerly ：Foxconn phone and components Tianjin Precision Industry Co., Ltd.)
Fugion Material Manufacturing and 110,297 Note 1 (2) - - - - 41,525 70 29,068 141,853 - Note 2 Technology (Shenzhen) marketing of potassium Limited aurous cyanide Antec Automotive Manufacturing and 238,811 Note 1 (2) 149,050 - - 149,050 42,643 100 42,643 163,943 - Note 2 Electric System marketing of automobiles (Kunshan) Co., Ltd. Liuzhou Antec Fangshen Manufacturing and - Note 1 (2) ------Note 3 Electric System Co., Ltd. marketing of automobiles
Foxconn Precision Manufacturing and 1,222,210 Note 1 (2) 977,404 - - 977,404 ( 254,225) 100( 254,225) 947,174 - Note 2 Electronics (Yantai) Co., marketing of Ltd. telecommunication peripherals
Premier Image Manufacturing and sale of 4,524,086 Note 1 (2) 19,377 - - 19,377 ( 1,786,956) 99.96( 1,786,241) 10,555,919 - Note 2 Technology (China) cameras Limited
253 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Fu Zhun Precision Designing, manufacturing $ 2,957,152 Note 1 (2)$ - $ - $ - $ - ($ 221,099) 100($ 221,099) $ 4,981,298 $ - Note 2 Tooling (Huaian) Co., and marketing of Ltd. computer components
Fu Yu Electronical Designing and marketing 7,935,422 Note 1 (2) 5,067,700 - - 5,067,700 110,390 100 110,390 10,252,496 - Note 2 Technology (Huaian) Co., of connectors and cables Ltd.
CJ Electric System Co., Manufacturing and 65,582 Note 1 (2) - - - - 39,721 50 19,861 187,178 - Note 2 Ltd. marketing of automobiles
Foxconn Precision Manufacturing and 14,115,035 Note 1 (2) 2,143,177 - - 2,143,177 439,077 100 439,077 19,418,508 - Note 2 Electronics (Taiyuan) Co., marketing of micro ribbon Ltd. connectors for terminals, etc.
Jizhun Precision Industry Manufacturing and 2,772,330 Note 1 (2) - - - - ( 447,115) 100( 447,115) 1,709,261 - Note 2 (Huizhou) Co., Ltd. marketing of computer cases, router, notebook, etc. Fukui Precision Manufacturing and 6,169,634 Note 1 (2) - - - - 4,701,955 41.36 1,944,729 7,209,591 - Note 2 Component (Shenzhen) marketing of electronics Co., Ltd. devices and cable Futaijing Precision Manufacturing and 2,235,750 Note 1 (2) - - - - ( 280,729) 67.08( 191,103) 1,273,044 - Note 2 Electronics (Beijing) Co., marketing of computer Ltd. cases, micro ribbon connectors for terminals, etc.
254 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
FIH Precision Electronics Manufacturing and $ 8,808,855 Note 1 (2)$ - $ - $ - $ - $ 2,482,367 67.08$ 1,689,842 $ 11,504,191 $ - Note 2 (Lang Fang) Co., Ltd. marketing of cell phone (Formerly ：Foxconn and components Precision Electronics (Lang Fang) Co., Ltd.)
Foxconn Good Field Manufacturing and 69,159 Note 1 (2) - - - - ( 6,724) 40( 2,690) 34,741 - Note 2 Precision Industry marketing of electronics (Dalian) Co., Ltd. calculator and components Fuyu Energy Technology Manufacturing and 596,200 Note 1 (2) - - - - 14,675 100 14,675 1,010,653 - Note 2 (Kunshan) Co., Ltd. marketing of micro ribbon connectors for terminals
Hongfujin Precision Manufacturing and 8,728,368 Note 1 (2) 5,750,348 - - 5,750,348 782,815 100 782,815 13,381,833 - Note 2 Industrial (Wuhan) Co., marketing of computer Ltd. and digital camera components Amworld Microsystems Manufacturing and 506,770 Note 1 (2) - - - - 12,611 100 12,611 678,748 - Note 2 (Shanghai) Ltd. marketing of switch supply and modem Hongqunsheng Precision Manufacturing and 2,037,321 Note 1 (2) - - - - ( 164,333) 41.36( 67,968) 340,971 - Note 2 Electronics (Yingkou) marketing of printed Co., Ltd. circuit board
Hongqisheng Precision Manufacturing and 5,600,406 Note 1 (2) - - - - 80,928 41.36 33,472 2,721,340 - Note 2 Electronics marketing of electronics (Qinhuangdao) Co., Ltd. calculator and component
255 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Hongfujin Precision Manufacturing and $ 2,110,548 Note 1 (2)$ - $ - $ - $ - $ 171,440 100$ 171,440 $ 35,347,847 $ - Note 2 Electrons (Yantai) Co., marketing of computer Ltd. components Foxconn (Nanjing) Manufacturing and 521,675 Note 1 (2) - - - - 34,260 67.08 23,322 297,391 - Note 2 Communications Co., marketing of handset and Ltd. components Foxconn (Nanjing) Computer software, 953,920 Note 1 (2) - - - - 5,611 100 5,611 719,900 - Note 2 Software Co., Ltd. hardware and other digital product
Fulin Electronical Manufacturing and - Note 1 (2) ------Note 4 Technology (Changshu) marketing of computer Co., Ltd. components and molds
Fuyang Electronical Manufacturing and 3,133,031 Note 1 (2) - - - - 60,036 100 60,036 3,341,635 - Note 4 Technology (Changshu) marketing of computer Co., Ltd. components and molds
Fu Tai Kang Electronics Marketing of computer 894,300 Note 1 (2) - - - - 16,691 100 16,691 1,219,975 - Note 2 Development (YanTai) chassis and metal Ltd. stamping parts
Foxconn (Shenyang) Numeric control machine 1,487,519 Note 1 (2) - - - - ( 5,481) 69.23( 3,794) 1,256,252 - Note 2 precision Industry Co., tool manufacturing Ltd. Hong Heng Sheng Print circuit board 4,562,590 Note 1 (2) - - - - ( 231,938) 41.36( 95,930) 1,646,674 - Note 2 Electronical Technology product manufacturing (Huaian) Co., Ltd. and sales
256 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Alibaba (China) Providing software and $ - Note 1 (2)$ - $ - $ - $ - $ - -$ - $ - $ - Note 5 Technology Co., Ltd. technology services
Alibaba (China) Software Providing software and - Note 1 (2) ------Note 5 Co., Ltd. technology services
Alibaba (Shanghai) Providing software and - Note 1 (2) ------Note 5 Technology Co., Ltd. technology services
Beijing Sinya Online Providing software and - Note 1 (2) ------Note 5 Information Technology technology services Co., Ltd.
Hongfuqiang Precision Manufacturing and - Note 1 (2) ------Note 6 Electronics (Yingkou) marketing of computer Co., Ltd. components and molds
Fu Ding Electronical Manufacturing and 6,289,910 Note 1 (2) 6,289,910 715,440 - 7,005,350 3,232,478 100 3,232,478 14,404,159 - Note 2 Technology (Jiashan) Co., marketing of computer Ltd. components and molds Fuhuajie Industrial Manufacturing and 3,428,150 Note 1 (2) 3,428,150 - - 3,428,150 ( 2,896,367) 100( 2,896,367) ( 2,139,438) - Note 2 (Shenzhen) Limited marketing of microcomputer and liquid crystal display GDS Software (Shenzhen) Computer software, 298,100 Note 1 (2) 298,100 - - 298,100 5,588 76.92 4,298 290,398 - Note 2 Co., Ltd. hardware and other digital product
257 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Futaihua Industrial Manufacturing and $ 11,029,700 Note 1 (2)$ 11,029,700 $ - $ - $ 11,029,700 $ 2,596,800 100$ 2,596,800 $ 79,080,078 $ - Note 2 (Shenzhen) Co., Ltd. marketing of microcomputer, cell phone and components Dong Guan Eson Design and manufacture 220,892 Note 1 (2) - - - - 4,805 28.81 1,384 96,080 - Note 2 Precision Tooling Co., of precision molds Ltd. Kunshan Eson Precision Design and manufacture 894,598 Note 1 (2) - - - - 14,935 28.81 4,303 529,852 - Note 2 Engineering Co., Ltd. of precision molds and mechanical parts for consumer electrical products Wuxi XinGuan Metal Design and manufacture 417,340 Note 1 (2) - - - - 87,512 28.81 25,212 117,992 - Note 2 Science & Technology of precision molds and Co., Ltd. mechanical parts for consumer electrical products Kunshan Eson Design and manufacture 298,100 Note 1 (2) - - - - 1,205 9.51 115 31,055 - Note 2 Technology Inc. of precision molds and mechanical parts for consumer electrical products Yantai Jiray Electronic Manufacturing and 153,820 Note 1 (2) - - - - ( 22,840) 18.73( 4,278) 51,306 - Note 2 Technology Co., Ltd. marketing of monitoring device Yantai Zheng Yi Manufacturing and 65,582 Note 1 (2) - - - - 8,066 28.81 2,324 13,403 - Note 2 Precision Electronic Co., marketing of monitoring Ltd. device
258 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030
Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Guangzhou OED Manufacturing and $ 215,294 Note 1 (2)$ - $ - $ - $ - ($ 137,890) 5.76($ 7,942) $ 24,282 $ - Note 2 Technologies Co., Ltd. marketing of mould and tooling MediaMarkt (Shanghai) E-book key material and - Note 1 (2) ------Note 7 Commercial & Trading components Company Limited manufacturing and sales Hongfujin Precision Manufacturing and 5,683,277 Note 1 (2) 5,683,277 - - 5,683,277 ( 2,752) 100( 2,752) 3,919,504 - Note 2 Electronics (Chongqing) marketing of computer Co., Ltd. chassis and metal stamping parts System Integration Manufacturing and 819,775 Note 1 (2) 860,009 - - 860,009 122,263 100 122,263 1,487,075 - Note 2 Electronics (Hangzhou) marketing of electronic Co., Ltd. components, network communication equipment, high-end routers and high-end switches Champ Tech Optical Manufacturing and 1,391,233 Note 1 (2) 1,594,550 - - 1,594,550 ( 124,473) 100( 124,473) 1,991,971 - Note 2 (Foshan) Corporation marketing of unassembled optical components
Innovation (Beijing) Design and publish of - Note 1 (2) ------Note 8 Software Development computer software Co., Ltd.
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Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
MediaMarkt (Shanghai) Management consulting $ - Note 1 (2)$ - $ - $ - $ - $ - -$ - $ - $ - Note 7 Consulting Service Co., services Ltd. Spreadcomm Technology Developing of computer 226,556 Note 1 (2) - - - - ( 3,709) 67.08( 2,525) 36,736 - Note 2 Corp. and communications software, and technical services Futaihua Precision Manufacturing and 2,981,000 Note 1 (2) 1,013,540 - - 1,013,540 4,842,178 100 4,842,178 11,447,523 - Note 2 Electronics (Zhengzhou) marketing of cell phone Co., Ltd.
Hongfujin Precision Manufacturing and 2,027,080 Note 1 (2) 2,027,080 - - 2,027,080 ( 178,204) 100( 178,204) 237,492 - Note 2 Electronics (Tianjin) Co., marketing of server Ltd.
Hongfujin Precision Manufacturing and 14,905,000 Note 1 (2) 5,962,000 - - 5,962,000 4,572,729 100 4,572,729 34,553,029 - Note 2 Electronics (Zhengzhou) marketing of cell phone Co., Ltd. and components
Hongfujin Precision Manufacturing and 10,433,500 Note 1 (2) 5,962,000 - - 5,962,000 6,997,458 100 6,997,458 27,802,165 - Note 2 Electronics (Chengdu) marketing of tablet PC Co., Ltd. Fuding Precision Manufacturing and 1,192,400 Note 1 (2) 298,100 - - 298,100 312,434 100 312,434 675,593 - Note 2 Industrial (Zhengzhou) marketing of new Co., Ltd. electronic components
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Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
YanTai FuHuaDa Manufacturing and $ 298,100 Note 1 (2)$ 298,100 $ - $ - $ 298,100 $ 246,582 100$ 246,582 $ 810,096 $ - Note 2 Precision Electronics marketing of new Co., Ltd. electronic components
Fujun Precision Manufacturing and 447,150 Note 1 (2) 447,150 - - 447,150 72,110 100 72,110 416,768 - Note 2 Electronics (Chongqing) marketing of switches and Co., Ltd. routers
Futaihua Precision Manufacturing and 1,550,120 Note 1 (2) 1,371,260 178,860 - 1,550,120 475,502 100 475,502 2,404,617 - Note 2 Electronics (Chengdu) marketing of compression Co., Ltd. molding plastic injection mold and metal
Anpinda Precision Manufacturing and 1,490,500 Note 1 (2) 1,192,400 - - 1,192,400 155,463 100 155,463 1,531,625 - Note 2 Industrial (Huizhou) Co., marketing of computer Ltd. components and microcomputers
NanNing FuGui Precision Manufacturing and 1,490,500 Note 1 (2) 1,266,925 - - 1,266,925 569,804 100 569,804 2,302,914 - Note 2 Industrial Co., Ltd marketing of network communication equipment NanNing Fu Tai Hong Manufacturing and 1,490,500 Note 1 (2) - - - - ( 44,703) 67.08( 30,431) 984,631 - Note 2 Precision Industry Co., marketing of cell phone Ltd
WWW (Jincheng) Co., Manufacturing and 774,612 Note 1 (2) 476,960 - - 476,960 ( 600,658) 76.85( 461,605) 270,749 - Note 2 Ltd. marketing of lens module
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Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
UER Technology Manufacturing and $ 186,376 Note 1 (2)$ - $ - $ - $ - ($ 54,350) 42.61($ 23,159) $ 48,317 $ - Note 2 (Shenzhen) Corporation marketing of lithium battery
Tianjin Funayuanchuang Manufacturing and 804,870 Note 1 (2) 506,770 - - 506,770 ( 121,293) 62.96( 76,366) 361,906 - Note 2 Technology Co., Ltd. marketing of liquid crystal display components
FuYu Energy Technology Engaged in the 894,300 Note 1 (2) - 1,639,550 - 1,639,550 ( 65,742) 100( 65,742) 1,601,140 - Note 2 (Funing) Co., Ltd. production and marketing of operating solar energy battery business
Futaihua Precision Engaged in wireless 11,178,750 Note 1 (2) 745,250 8,197,750 - 8,943,000 3,537,471 100 3,537,471 16,945,230 - Note 2 Electronics (Jiyuan) handsets of wired Limited telephones, cellular networks or other wireless IP telephone Hongfujin Precision Engaged in the operation - Note 1 (2) ------Note 9 Industry (Loyang) Co., of automated equipment, Ltd. multipurpose industrial robots, the equipment enclosure sheet metal production and marketing business
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Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Futaijing Precision Manufacturing and $ 596,200 Note 1 (2)$ - $ - $ - $ - $ 406,032 67.08$ 276,401 $ 701,860 $ - Note 2 Electronics (Yantai) Co., marketing of handset Ltd. component product
Zhong Zhun Precision Reducer, Other - Note 1 (2) ------Note Industries (Luoyang) Co., transmission shafts and 10 Ltd. cranks
Hongfutai Precision Work holders 1,132,780 Note 1 (2) 1,132,780 - - 1,132,780 ( 20,588) 100( 20,588) 1,154,672 - Note 2 Industry (Hen Yang) Co., Ltd. Innocom Technology LCD related products, 89,430 Note 1 (2) 118,464 - - 118,464 ( 341,760) 100( 341,760) ( 147,369) - Note 2 (Chongqing) Co., Ltd. modules, components and systems manufacture Funeng Energy Electromechanical 178,860 Note 1 (2) - - - - 6,671 100 6,671 194,074 - Note 2 Technology Service telecommunications and (Nanyang) Co., Ltd. circuit equipment installation
Interface Technology To manufacture, produce 1,117,875 Note 1 (2) - 760,155 - 760,155 462,951 28.33 131,154 263,284 - Note 2 (ChengDu) Co., Ltd. and sell LCD modules and related materials Changchun Leiguan Articles for the 44,715 Note 1 (2) - 44,715 - 44,715 - 100 - - - Note 2 Environmental Plastic conveyance or packing of Products Co., Ltd. goods, of plastics
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Amount remitted from Accumulated Accumulated Investment Accumulated Taiwan to Mainland amount of amount of income (loss) amount of China/Amount remitted back remittance remittance recognised by Book value of investment to Taiwan for the year ended from Taiwan from Taiwan Ownership the Company investments in income December 31, 2013 to Mainland to Mainland Net income of held by the for the year Mainland remitted back China as of Remitted Remitted China as of investee as of Company ended China as of to Taiwan as Investee in Mainland Investment January 1, to Mainland back to December 31, December 31, (direct or December 31, December 31, of December China Main business activities Paid-in capital method 2013 China Taiwan 2013 2013 indirect) 2013 2013 31, 2013 Note
Ying Tai Environmental Manufacturer of $ - Note 1 (2)$ - $ - $ - $ - $ - 100$ - $ - $ - Note Technology Ltd. degradable plastic resin 11
Shiang Tai Environmental Manufacturer of - Note 1 (2) - - - - - 100 - - - Note Technology Ltd. degradable plastic resin 12
Fu Hon Yuan Environmental 5,962 Note 1 (2) - - - - 7 70 5 4,334 - Note 2 Environmental Technology Development Technology Ltd. and Wholesale of Pollution Controlling Equipments
Scienbizip Consulting Management Consulting 131,164 Note 1 (2) - - - - 33,141 51 16,902 171,562 - Note 2 (Shen Zhen) Co.,Ltd. Services
Accumulated amount of remittance Investment amount approved by the Ceiling on investments in Mainland from Taiwan to Mainland China as of Investment Commission of the Ministry China imposed by the Investment Company name December 31, 2013 of Economic Affairs (MOEA) Commission of MOEA Hon Hai Precision Industry Co., Ltd. $ 95,368,046 $ 183,806,446 $ -
Note 1: Investment methods are classified into the following three categories: (1) Directly invest in a company in Mainland China. (2) Through investing in Foxconn (Far East) Limited in the third area, which then invested in the investee in Mainland China. (3) Others. Note 2: The basis for investment income (loss) recognition is from the financial statements audited and attested by R.O.C. parent company’s CPA, except Foxconn Precision Component (Beijing) Co., Ltd.,Shenzhen Fu Tai Hong Precision Industry Co., Ltd.,Honxun Electrical Industry (Hangzhou) Co., Ltd,Fuxiang Precision Industrial (kunshan) Co.,Ltd.,FIH(Tian Jin) Precision Industry Co. Ltd. (Formerly ：Foxconn Tianjin Precision Industry Co. Ltd.) ,Futaijing Precision Electronics (Beijing) Co., Ltd.,FIH Precision Electronics (Lang Fang) Co., Ltd. (Formerly ：Foxconn Precision Electronics (Lang Fang) Co., Ltd.),Foxconn (Nanjing) Communications Co.,
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Ltd.,Spreadcomm Technology Corp.,NanNing Fu Tai Hong Precision Industry Co., Ltd and Futaijing Precision Electronics (Yantai) Co., Ltd. which the financial statements are audited and attested by international accounting firm which has cooperative relationship with accounting firm in R.O.C. Note 3: The shares of Liuzhou Antec Fangshen Electric System Co., Ltd. have been sold out in February, 2012. As of December 31, 2013, the funds have not been remitted back. Note 4: The Company was approved by Investment Commission, MOEA of the merger of Fulin Electronical Technology (Changshu) Co., Ltd. and Fuyang Electronical Technology (Changshu) Co., Ltd. which is surviving entity. Note 5: The Company held indirect ownership of the Mainland China subsidiaries of Alibaba (China) Technology Co., Ltd., Alibaba (China) Software Co., Ltd., Alibaba (Shanghai) Technology Co., Ltd., and Beijing Sinya Online Information Technology Co., Ltd., which have been sold out in June, 2012. Note 6: The Company was approved by Investment Commission, MOEA of an investment of US$ 2,500,000 in Hongfuqiang Precision Electronics (Yingkou) Co., Ltd, which had been liquidated in December 2012. Note 7: The Company held indirectly 6.75% ownership of the Innovation Work Limited, and the investment amount of the Company approved by the Investment Commission of the Ministry of Economic Affairs was US$2,600,000. As of December 31, 2013, the funds have not been remitted. Note 8: The Company was approved by Investment Commission, MOEA of an investment of US$ 8,750,000 and US$50,000,000 in MediaMarkt (Shanghai) Consulting Service Company Limited and MediaMarkt (Shanghai) Commercial & Trading Company Limited, respectively. The Company’s board of directors resolved on March 25, 2013 for a subsidiary of the Company to sell its ownership in Mediamarkt (China) International Retail Holding Ltd. (Mediamarkt) including Mediamarkt’s two subsidiaries in China namely, MediaMarkt (Shanghai) Consulting Service Company Limited and MediaMarkt (Shanghai) Commercial & Trading Company Limited. The Company was approved by Investment Commission, MOEA of above disposal on July 10, 2013 and May 30,2013, respectively. Note 9: The Company was approved by Investment Commission, MOEA of an investment of US$ 17,500,000 in Hongfujin Precision Industry (Loyang) Co., Ltd., which has not yet been established as of December 31, 2013. Note 10: The Company was approved by Investment Commission, MOEA of an investment of US$ 7,320,000 in Zhong Zhun Precision Industries (Luoyang) Co., Ltd., which has not yet been established as of December 31, 2013. Note 11: The Company was approved by Investment Commission, MOEA of an investment of US$ 27,693,000 in Ying Tai Environmental Technology Ltd., which has not yet been established as of December 31, 2013 Note 12: The Company was approved by Investment Commission, MOEA of an investment of US$ 13,617,000 in Shiang Tai Environmental Technology Ltd.., which has not yet been established as of December 31, 2013 Note 13: The Company was approved by Investment Commission, MOEA of an investment of US$ 3,000,000 in Guangxuhui Technology (Shenzhen) Co., Ltd., which had been liquidated in 2005. Note 14: The Company was approved by Investment Commission, MOEA of an investment of US$ 625,000 in Shanghai Premier Image Trade Co., Ltd., which had been liquidated in April, 2009. Note 15: The Company was approved by Investment Commission, MOEA of an investment of US$ 684,000 in Dongfeng Antec (Wuhan) Automobile Electric System Co., Ltd. All of the shares had been transferred to Teamsmart Corporation during 2009 . Note 16: Pursuant to the Jing-Shen-Zi Letter No. 09704604680 of the Ministry of Economic Affairs, R.O.C., dated August 29, 2008, as the Company has obtained the certificate of being qualified for operating headquarters, issued by the Industrial Development Bureau, MOEA, the ceiling amount of the investment in Mainland China is not applicable to the Company. ， Note 17: The Company invests in the company via investee companies in Mainland China including Foxstar Technology Co.,Ltd., Harbing GDS Technology Co., Ltd., ZhengZhou FuLianWang Electronic Technology Co.,Ltd., Erdos HongHan Precision Electronics Limited, Shanghai Foxconn Co., Ltd., Huaian Fulitong Trading Co., Ltd., Huaian Futaitong Logistics Co.,Ltd., Shenzhen Fuhongjie Technology Service Co.,Ltd., Shenzhen Fuhongjie Technology Service Co.,Ltd., Shan Hai Pengzhan Ivestment Co.,Ltd, Fu You Wan De Trading Co.,Ltd., Chongqingshi Futaitong Lotistics Limited Co., Limited, FoShan ShunDe Jishun Precision Industry Co., Ltd., Chengdu Fu Tai Logistics Co.,Ltd., Zhengzhou Airport Fertile Plan Logistics Co., Ltd., Chen Du Fuyu Vocational Skills Training Center, HenYang FuXiangYun Cuiture Co.,Ltd., Shanghai Fujintong Commercial Factoring Co.,Ltd., Wan Ma Ben Teng Trading Co.,Ltd.-China Jiaxin, Wan Ma Ben Teng Trading Co.,Ltd.-China Shenxhen, Wan Ma Ben Teng Trading Co.,Ltd.-China Zhengzhou, Wan Ma Ben Teng Trading Co.,Ltd.-China Chengdu, Wan Ma Ben Teng Trading Co.,Ltd.-China Kunshan, Wan Ma Da Trading Co.,Ltd.,-China Yantai, Wang Hui Trading Co., Ltd.-China Shanghai, Wan Ma Da Trading Co.,Ltd.,-China GuangXi, Wan Ma Ben Teng Trading Co.,Ltd.-China TianJin, Fu Ma Trading Co.,Ltd.-China Anhui, Sheng Ma Trading Co.,Ltd.-China Hebei, FuJian Wanmada Commerce Co., Ltd., Wan Ma Ben Teng Trading Co.,Ltd.-China HuNan, Wan Ma Ben Teng Trading Co.,Ltd.-China JiangXi, Wan Ma Ben Teng Trading Co.,Ltd.-China Chongqin, FuXun Tong Trading(ShenZhen) Co., Ltd., Efeihu(Beijing) E-commerce Ltd., Efeihu(Chengdu) E-commerce Ltd., Efeihu(Wuhan) E- commerce Ltd., Chongqing Shendeng Technology Co., Ltd, HongQingXin Precision Electronics (ChongQing) Co.,Ltd, ChongQing HongFuZhun Trading Co.,Ltd, Tian Zhen Foxconn Photovoltaic Electricity Generation Co., Ltd., Da Tong Foxconn Photovoltaic Electricity Generation Co., Ltd., Yang Gao Foxconn Photovoltaic Electricity Generation Co., Ltd., Shanghai KetaiHuajie Investment Co., Ltd., Shan Hai Ketai Technology Co.,Ltd.,
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Chengdu Ketai Huajie Technology Co Ltd, Shen Zhen Fu Neng new energy technology Co., Ltd., Shenzhen Fuhongle Trade Co Ltd., Chengdu Chengfu human resource management Co. Ltd., Foxstar Technology Co.,Ltd, Henan Zhongyuan Finance & Fund Management Co., Ltd., Henan Zhongyuan Finance Sponsion Co.Ltd., ZhengZhou FuLianWang Electronic Technology Co.,Ltd, Zhengzhou Fuyucheng Agricultural Biotechnology Co., Ltd., Zhengzhou Fuyusheng Energy Technology Co., Ltd., ZhengZhou JingJi Precision Machinery Trading Company Ltd., Zhenzhou airport Yongyang Technology Trading Co., JiYuan Jizhun Precision Electronics Limited, KunShan Wanmayun Commerce & Trade Co., Ltd., Shanxi HuNan Wanmayun Electronic Technology Co.,Ltd.,Wan Ma Ben Teng Trading Co.,Ltd.-China Jiaxin, GuangZhou Wanpingyunma Electronic Technology Co.,Ltd, HuNan Wanmayun Electronic Technology Co.,Ltd, GuangZhou Wanpingyunma Electronic Technology Co.,Ltd, ShangHai Fuhong Electronic Technology Co.,Ltd, ChengDu XunFeng Trading Co.,Ltd, NanYang Wanmayun Electronic Technology Co.,Ltd, Guizhou Fulianwang electronic Technology Co Ltd, Zhengzhou WanmaYun Elec. Technology Co., Ltd., Langfang FLW Trade Co., Ltd, YanTai Wanma Technology Co.,Ltd, Yantai Futaitong International Logistics Co.,Ltd., Synergy Technology （ChengDu ）Co.,Ltd., Synergy Technology （ChengDu ）Co.,Ltd., HongZhaoDa Integrated Innovative Serice(KunShan)Co.,Ltd, Hengyang Futaihong Precision Industry Co.,Ltd., Wan Ma Ben Teng Trading Co.,Ltd.-China HuNan, Shanghai Futaitong International Logistics Co.,Ltd.. Except for the investment via the holding companies in Mainland China, other investments shall be approved by Investment Commission of the Ministry of Economic Affairs. B. Significant transactions conducted with investees in Mainland China directly or indirectly through other companies in the third areas.
The Company subcontracted the processing of products to Foxconn (Far East) Limited’s subsidiaries located in Mainland China. All intercompany transactions were eliminated when preparing consolidated financial statements.
Significant transactions conducted with investees in Mainland China are described in Notes 13(1) A, B, G and H.
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14. SEGMENT INFORMATION (4) General information The Group has adopted eCMMS (E-enabled Components, Modules, Moves & Services) strategy, and provided a one-stop shop to its customers, which are primarily in the 3C industries, with a total solution for design, development, engineering, procurement, manufacturing, logistics and after-sales service. The Group segregates operating segments from both a customer service and product perspective. In accordance with IFRS No. 8, “Operating Segments”, the Group has determined the operating segments and reportable operating segments. Operating segments which have met certain quantitative threshold are disclosed individually or aggregately as reportable operating segments; other segments which have not met the quantitative threshold are included in the ‘all other segments’. The Group has identified the electronic manufacturing integrated services department, which provides global 3C production-related one-stop services, as a reportable operating segment. (5) Measurement of segment information The chief operating decision maker assesses performance and allocates resources of the operating segments based on each operating segment’s revenue and operating income after adjusting the internal costs and allocated expenses. Except that recognition of internal costs shall be in accordance with the Group’s related internal calculation basis, the operating segments’ accounting policies are the same as disclosed in Note 4. (6) Segment information The financial information of reportable segments provided to chief operating decision maker is as follows: For the years ended December 31, 2013 2012 Electronic Electronic Manufacturing Manufacturing Integration Service Integration Service Net external revenue$ 3,819,633,198 $ 3,880,825,993 Revenue from internal customers 667,409,238 526,688,317 Segment revenue $ 4,487,042,436 $ 4,407,514,310 Segment profit $ 111,975,068 $ 122,477,734 (7) Reconciliation for segment income (loss) Sales between segments are carried out at arm’s length. The revenue from external parties reported to the chief operating decision-maker is measured in a manner consistent with that in the income statement.
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A reconciliation of reportable segment profit or loss to the profit before tax and discontinued operations for the years ended December 31, 2013 and 2012 is provided as follows: For the years ended December 31, Operating revenue 2013 2012 Total reported segment revenue$ 4,487,042,436 $ 4,407,514,310 Other operating segment revenue 46,493,844 55,771,358 Elimination of intersegment revenue ( 581,218,740) ( 557,890,346) Total corporate revenue $ 3,952,317,540 $ 3,905,395,322 For the years ended December 31, Profit and loss 2013 2012 Profit of reported segment$ 111,975,068 $ 122,477,734 Profit (loss) of other operating segments 11,573,220 ( 11,796,307) Elimination of intersegment transactions and internal costs and allocated expenses adjustments 12,747,409 7,490,658 $ 136,295,697 $ 118,172,085 Profit before income tax (8) Geographical information Geographical information for the years ended December 31, 2013 and 2012 is as follows: For the years ended December 31, 2013 2012 Non-current Non-current Revenue assets Revenue assets U.S.A$ 1,301,322,343 $ 1,494,818 $ 1,140,906,312 $ 1,751,004 Ireland 1,206,104,879 169,156 1,096,315,965 173,191 China 277,316,300 324,688,619 340,938,734 342,166,834 Singapore 392,845,718 86,572 334,362,334 151,407 Japan 159,774,939 185,350 217,845,375 22,082 Taiwan 53,511,456 34,956,163 111,468,690 30,944,534 Others 561,441,905 57,480,937 663,557,912 62,804,923 Total $ 3,952,317,540 $ 419,061,615 $ 3,905,395,322 $ 438,013,975
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(9) Major customer information Major customer information of the Group for the years ended December 31, 2013 and 2012 is as follows: For the years ended December 31, 2013 2012 Revenue (in millions) Revenue (in millions) Client E$ 2,001,215 $ 1,865,774 Client C 398,527 459,975 15. INITIAL APPLICATION OF IFRSs (1) These consolidated financial statements are the first consolidated financial statements prepared by the Group in accordance with the IFRSs. The Group has adjusted the amounts as appropriate that are reported in the previous R.O.C. GAAP consolidated financial statements to those amounts that should be presented under IFRSs in the preparation of the opening IFRS balance sheet. Information about exemptions elected by the Group, exceptions to the retrospective application of IFRSs in relation to first-time adoption of IFRSs, and how it affects the Group’s financial position, operating results and cash flows in transition from R.O.C. GAAP to the IFRSs is set out below: A. Business combinations The Company has elected not to apply the requirements in IFRS 3, “Business Combinations”, retrospectively to business combinations that occurred prior to the date of transition to IFRSs (‘the transition date’). This exemption also applies to the Company’s previous acquisitions of investments in associates. B. Share-based payment transactions The Company has elected not to apply the requirements in IFRS 2, “Share-based Payment”, retrospectively to equity instruments vested and liabilities that were settled arising from share-based payment transactions prior to the transition date. C. Leases The Company has elected to apply the transitional provisions in IFRS 4, “Determining Whether an Arrangement Contains a Lease”. Therefore, the Company determines whether an arrangement existing at the transition date contains a lease based on the facts and circumstances on that date. D. Employee benefits The Company has elected to recognize all cumulative actuarial gains and losses relating to all employee benefit plans in ‘retained earnings’ at the transition date, and to disclose the information of present value of defined benefit obligation, fair value of plan assets, gain or loss on plan assets and experience adjustments under the requirements of paragraph 120A (P), IAS 19, “Employee Benefits”, based on their prospective amounts for financial periods from the transition date.
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E. Compound financial instruments The Company has elected not to segregate between liability components and equity components of compound financial instruments whose liability components were no longer outstanding at the transition date. F. Designation of previously recognized financial instruments The Company reclassified part of financial assets carried at cost to available-for-sale financial assets on the transition date. G. Decommissioning liabilities included in the cost of property, plant and equipment The Company has elected to measure the decommissioning liabilities included in the cost of certain property, plant and equipment at the transition date in accordance with IAS 37, “Provisions, Contingent Liabilities and Contingent Assets”. H. Borrowing costs The Company has elected to apply the transitional provisions in paragraphs 27 and 28 of IAS 23, “Borrowing Costs”, amended in 2007 and apply IAS 23 from the transition date. I. Transfers of assets from customers The Company has elected to apply the transitional provisions in paragraph 22 of IFRIC 18, “Transfers of Assets from Customers”, and apply IFRIC 18 from the transition date. (2) Except for hedge accounting to which exceptions to the retrospective application of IFRSs specified in IFRS 1 are not applicable as the Group does not have hedge accounting, other exceptions to the retrospective application are set out below: A. Accounting estimates Accounting estimates made under IFRSs on January 1, 2012 are consistent with those made under R.O.C. GAAP on that day. B. Derecognition of financial assets and financial liabilities The derecognition requirements in IAS 39, “Financial Instruments: Recognition and Measurement” shall be applied prospectively to transactions occurring on or after January 1, 2004. C. Non-controlling interest Requirements of IAS 27 (amended in 2008) that shall be applied prospectively are as follows: (a) Requirements concerning total comprehensive income (loss) attributed to owners of the parent and non-controlling interest, even if it results in a negative balance in non- controlling interest; (b) Requirement that change in interest ownership of the parent in a subsidiary while control is retained is accounted for as an equity transaction with the parent; and. (3) Requirement to reconcile from R.O.C. GAAP to IFRSs at the time of initial application IFRS 1 requires that entity make reconciliation for equity, comprehensive income and cash flows for the comparative periods. The Group’s initial application of IFRSs has no significant effect on cash flows from operating activities, investing activities and financing activities. Reconciliation for
270 WorldReginfo - 99f63593-5703-4942-b74d-dc8c07c0d030 equity and comprehensive income for the comparative periods as to transition from R.O.C. GAAP to IFRSs is shown below: A.Reconciliation for equity on January 1, 2012: Current assets GAAP (R.O.C.) Adjustment IFRSs Description Cash and cash equivalents$ 329,793,633 $ - $ 329,793,633 Financial assets at fair value 70,329 - 70,329 through profit or loss - current Available-for-sale financial 674,287 - 674,287 assets - current Accounts receivable (including 476,049,795 - 476,049,795 related parties) Other receivables 34,679,896 - 34,679,896 Inventory 380,521,794 - 380,521,794 Prepayment 7,119,919 - 7,119,919 Other current assets 54,758,169 ( 8,016,419) 46,741,750 (12) 1,283,667,822 ( 8,016,419) 1,275,651,403 Total current assets Non-current assets Available-for-sale financial 4,790,319 4,575,192 9,365,511 (1)(2) assets - non-current Financial assets carried at 4,046,796 ( 28,740) 4,018,056 (2) cost - non-current Investments accounted for 40,259,657 ( 2,467,599) 37,792,058 (1) under equity method Property, plant and equipment 355,373,481 12,792,611 368,166,092 (3)(9) Investment property - 1,345,340 1,345,340 (4) Intangible assets 695,266 - 695,266 Deferred income tax assets - 10,560,705 10,560,705 (5)(7)(12) Other non-current assets 41,478,084 ( 14,137,951) 27,340,133 (3)(4)(9) Total non-current assets 446,643,603 12,639,558 459,283,161 $ 1,730,311,425 $ 4,623,139 $ 1,734,934,564 Total Assets
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Current liabilities GAAP (R.O.C.) Adjustment IFRSs Description Short-term loans$ 260,522,749 $ - $ 260,522,749 Short-term notes and bills 7,989,312 - 7,989,312 payable Financial liabilities at fair value 251,834 - 251,834 through profit or loss - current Accounts payable (including 548,494,279 - 548,494,279 related parties) Other payables 121,335,944 1,809,910 123,145,854 (7) Current income tax liabilities 19,939,503 - 19,939,503 Provisions for liabilities 7,302,884 - 7,302,884 - current Other current liabilities 25,879,538 - 25,879,538 Total current liabilities 991,716,043 1,809,910 993,525,953 Non-current liabilities Financial liabilities at fair value - 470,158 470,158 (6) through profit or loss - non-current Bonds payable - non-current 62,378,777 - 62,378,777 Long-term loans 53,600,100 - 53,600,100 Deferred income tax liabilities 1,793,747 2,133,854 3,927,601 (12) Other non-current liabilities 5,803,274 453,411 6,256,685 (5) Total non-current liabilities 123,575,898 3,057,423 126,633,321 Total Liabilities $ 1,115,291,941 $ 4,867,333 $ 1,120,159,274 Equity attributable to owners of the parent Capital stock Common stock 106,890,967 - 106,890,967 Capital reserve 70,693,639 ( 17,486,928) 53,206,711 (1)(6)(8) Retained earnings Legal reserve 51,821,402 - 51,821,402 (1)(5) Undistributed earnings 325,500,402 14,691,725 340,192,127 (6)(7)(8) Other equity Cumulative translation 21,141,456 ( 94,099) 21,047,357 (1)(7) adjustments Unrealized gain or loss on 1,802,723 2,645,108 4,447,831 (1)(2) financial instruments Treasury stock ( 18,901) - ( 18,901) Equity attributable to owners of the parent 577,831,688 ( 244,194) 577,587,494 Non-controlling interest 37,187,796 - 37,187,796 Total equity 615,019,484 ( 244,194) 614,775,290 Total Liabilities and Stockholders’ equity $ 1,730,311,425 $ 4,623,139 $ 1,734,934,564
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B.Reconciliation for equity on December 31, 2012:
GAAP (R.O.C.) Adjustment IFRSs Description Current assets Cash and cash equivalents$ 505,526,956 $ - $ 505,526,956 Financial assets at fair value 140,220 - 140,220 through profit or loss - current Available-for-sale financial 777,410 - 777,410 assets - current Accounts receivable (including 633,048,641 - 633,048,641 related parties) Other receivables 38,235,975 - 38,235,975 Inventory 349,882,643 - 349,882,643 Prepayment 7,647,041 - 7,647,041 Other current assets 7,698,556 ( 6,751,334) 947,222 (12) Total current assets 1,542,957,442 ( 6,751,334) 1,536,206,108 Non-current assets Financial assets at fair value 179,300 - 179,300 through profit or loss - non-current Available-for-sale financial 8,302,853 4,195,864 12,498,717 (1)(2) assets - non-current Financial assets carried at 8,620,722 ( 28,740) 8,591,982 (2) cost - non-current Investments accounted for 44,492,047 ( 2,533,104) 41,958,943 (1) under equity method Property, plant and equipment 390,298,219 14,856,857 405,155,076 (3)(9) Investment property - 1,231,003 1,231,003 (4) Intangible assets 3,954,469 - 3,954,469 Deferred income tax assets - 10,951,902 10,951,902 (5)(7)(12) Other non-current assets 45,598,465 ( 16,087,860) 29,510,605 (3)(4)(9) Total non-current assets 501,446,075 12,585,922 514,031,997 Total Assets $ 2,044,403,517 $ 5,834,588 $ 2,050,238,105
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Current liabilities GAAP (R.O.C.) Adjustment IFRSs Description Short-term loans$ 297,572,165 $ - $ 297,572,165 Short-term notes and bills 7,991,597 - 7,991,597 payable Financial liabilities at fair value 66,767 15,288 82,055 (6) through profit or loss - current Accounts payable (including 638,370,641 - 638,370,641 related parties) Other payables 193,939,261 2,328,293 196,267,554 (7) Current income tax liabilities 19,177,206 - 19,177,206 Provisions for liabilities 3,464,280 - 3,464,280 - current Other current liabilities 89,442,390 - 89,442,390 Total current liabilities 1,250,024,307 2,343,581 1,252,367,888 Non-current liabilities Bonds payable - non-current 74,980,461 - 74,980,461 Long-term loans 30,707,957 - 30,707,957 Deferred income tax liabilities 468,606 3,680,359 4,148,965 (12) Other non-current liabilities 6,491,033 628,051 7,119,084 (5) Total non-current liabilities 112,648,057 4,308,410 116,956,467 Total Liabilities $ 1,362,672,364 $ 6,651,991 $ 1,369,324,355 Equity attributable to owners of the parent Capital stock Common stock 118,358,665 - 118,358,665 Capital reserve 77,266,078 ( 18,334,000) 58,932,078 (1)(6)(8) Retained earnings Legal reserve 59,980,502 - 59,980,502 (1)(5) Undistributed earnings 385,380,938 14,410,421 399,791,359 (6)(7)(8) Other equity Cumulative translation 1,395,612 ( 25,101) 1,370,511 (1)(7) adjustments Unrealized gain or loss on 4,169,293 2,265,753 6,435,046 (1)(2) financial instruments Treasury stock ( 18,901) - ( 18,901) Equity attributable to owners of the parent 646,532,187 ( 1,682,927) 644,849,260 Non-controlling interest 35,198,966 865,524 36,064,490 Total equity 681,731,153 ( 817,403) 680,913,750 (8) Total Liabilities and Stockholders’ equity $ 2,044,403,517 $ 5,834,588 $ 2,050,238,105
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C.Reconciliation for comprehensive income for the year ended December 31, 2012: GAAP (R.O.C.) Adjustment IFRSs Description Operating revenue $ 3,905,395,322 $ - $ 3,905,395,322 (5)(7) Operating costs ( 3,575,766,285) ( 79,379,769) ( 3,655,146,054) (10)(11) Gross profit 329,629,037 ( 79,379,769) 250,249,268 Operating expenses Selling expenses ( 104,581,183) 78,942,564 ( 25,638,619) General and administrative (5)(7) expenses ( 70,970,421) ( 76,211) ( 71,046,632) (10)(11) Research and development expenses ( 45,626,952) ( 38,795) ( 45,665,747) Operating profit 108,450,481 ( 552,211) 107,898,270 Non-operating income and expenses Other income 17,874,889 144,956 18,019,845 (1) Other gains and losses ( 952,841) 454,870 ( 497,971) (6) Finance costs ( 9,786,423) - ( 9,786,423) Share of profit of associates and joint ventures accounted for under equity method 2,792,985 ( 254,621) 2,538,364 (1) Profit before income tax 118,379,091 ( 207,006) 118,172,085 Income tax expense ( 26,591,950) 86,601 ( 26,505,349) (5)(7) Net income $ 91,787,141 ($ 120,405) 91,666,736 Other comprehensive income Currency translation differences ( 18,737,151) Unrealized gain on valuation of available-for-sale financial assets 1,755,830 Actuarial loss on defined benefit plan ( 193,854) Share of other comprehensive income of associates and joint ventures accounted for under equity method ( 770,538) Income tax relating to the components of other comprehensive income 32,955 Other comprehensive income for the year ( 17,912,758) Total comprehensive income for the year $ 73,753,978
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GAAP (R.O.C.) Adjustment IFRSs Description Profit attributable to: Owners of the parent$ 94,762,377 ($ 120,405) $ 94,641,972 Non-controlling interest ( 2,975,236) - ( 2,975,236) $ 91,787,141 ($ 120,405) $ 91,666,736 Total comprehensive income attributable to: Owners of the parent $ 76,791,442 Non-controlling interest ( 3,037,464) $ 73,753,978
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Description of the reconciliation of significant differences: Increase (Decrease) At transition December 31, Item Explanation Account date 2012 (1) Investments in associates / Equity investments under the equity method In accordance with current accounting standards in R.O.C., Available-for-sale financial assets - non- $ 4,530,477 $ 4,153,041 if an investor company holds less than 20% of the investee current company's voting shares without losing significant Unrealized gain or loss on financial 2,629,133 2,251,670 influence over an investee company, the investments instruments should be accounted for under equity method. In Undistributed earnings( 535,814) ( 535,814) accordance with IAS 28,“Investments in Associates”, the Gain on equity investments under the - ( 254,621) Group determines that it does not have significant influence equity method over certain investees that were accounted for as equity- Capital reserve from long-term ( 8,172) 10,280 method investees previously, and has reclassified these investments investments as “Available-for-sale financial assets” and Cumulative translation adjustments( 22,269) 3,466 measured them at fair value. Equity investments under the equity ( 2,467,599) ( 2,533,104) method Dividend income - 144,956
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Increase (Decrease) At transition December 31, Item Explanation Account date 2012 (2) Financial assets: equity instruments In accordance with the pre-amended “Rules Governing the Available-for-sale financial assets - non- $ 44,715 $ 42,823 Preparation of Financial Statements by Securities Issuers”, current before July 7, 2011, unlisted stocks and emerging stocks Unrealized gain or loss on financial 15,975 14,083 held by the Company should be measured at cost and instruments recognized in ‘Financial assets carried at cost’. However, in accordance with IAS 39, “Financial Instruments: Financial assets carried at cost - ( 28,740) ( 28,740) Recognition and Measurement”, investments in equity non-current instruments without an active market but with reliable fair value measurement (i.e. the variability of the estimation interval of reasonable fair values of such equity instruments is insignificant, or the probability for these estimates can be made reliably) should be measured at fair value.
(3) Prepayments for equipment In accordance with the “Rules Governing the Preparation Other assets - non-current 2,309,167 5,308,218 of Financial Statements by Securities Issuers”, prepayments for the acquisition of property, plant and Prepayments for equipment( 2,309,167) ( 5,308,218) equipment are classified as “Property, plant and equipment”. However, under IFRSs, it should be classified as “Other assets - non-current”.
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Increase (Decrease) At transition December 31, Item Explanation Account date 2012 (4) Property, plant and equipment In accordance with current accounting standards in R.O.C., Investment property$ 1,345,340 $ 1,231,003 the Company’s property that is leased to others is Other assets - non-current( 1,345,340) ( 1,231,003) presented in ‘Other assets’ account. In accordance with IAS 40, “Investment Property”, property that meets the definition of investment property is classified and accounted for as ‘Investment property’.
(5) Pension (i) The discount rate used to calculate pensions shall be Reserve for retirement plan 453,411 628,051 determined with reference to the factors specified in Undistributed earnings( 376,331) ( 376,331) R.O.C. SFAS 18, paragraph 23. However, IAS 19, Deferred income tax assets - non-current 77,080 106,769 “Employee Benefits”, requires an entity to determine the rate used to discount employee benefits with Operating cost - salaries - ( 2,953) reference to market yields on high quality corporate Selling expenses - salaries - ( 1,502) bonds that match the currency at the end day of the reporting period and duration of its pension plan; General and administrative expenses - - ( 6,016) when there is no deep market in corporate bonds, an salaries entity is required to use market yields on government Research and development expenses - - ( 8,743) bonds (at the end day of the reporting period) instead. salaries Income tax expense - 3,266 Actuarial loss on defined benefit plan - ( 160,899)
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Increase (Decrease) At transition December 31, Item Explanation Account date 2012 (5) Pension (ii) The Company recognized all accumulated actuarial gain or loss associated with the employee benefit plans in "Retained earnings" at the date of transition to IFRSs. (iii) In accordance with current accounting standards in R.O.C., the unrecognized transitional net benefit obligation should be amortized on a straight-line basis over the average remaining service period of employees still in service and expected to receive benefits. However, as this is the Company’s first-time adoption of IFRSs, the transition provisions of IAS 19, “Employee Benefits”, do not apply to the Company. Accordingly, there is no unrecognized transitional net benefit obligation. (iv) In accordance with current accounting standards in R.O.C., actuarial pension gain or loss of the Group is recognized in net pension cost of current period using the “corridor” method. However, in accordance with IAS 19, “Employee Benefits”, actuarial pension gain or loss is recognized immediately in other comprehensive income.
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Increase (Decrease) At transition December 31, Item Explanation Account date 2012 (6) Financial instruments: presentation In accordance with current accounting standards in R.O.C., Financial liabilities at fair value through $ 470,158 $ - the conversion price of convertible bonds overseas should profit or loss - non-current be converted to an agreed conversion price in New Taiwan dollars with a fixed exchange rate applicable on Financial liabilities at fair value through - 15,288 conversion of bonds. The conversion rights which are profit or loss - current converted to a fixed amount of common shares should be Undistributed earnings 1,564,282 1,564,282 classified as equity instruments. However, in accordance Capital reserve from conversion right( 2,034,440) ( 2,034,440) with IAS 32, “Financial Instruments: Presentation”, the conversion rights which do not meet the criteria of equity Gain on valuation of financial liabilities - 454,870 instruments should be classified as financial liabilities. (7) Employee benefits The current accounting standards in R.O.C. do not specify Accrued expenses 1,809,910 2,328,293 the rules on the cost recognition for accumulated unused Undistributed earnings( 1,404,728) ( 1,404,728) compensated absences. The Company recognizes such Deferred income tax assets - non-current 333,352 413,440 costs as expenses upon actual payment. However, IAS 19, “Employee Benefits”, requires that the costs of Cumulative translation adjustments( 71,830) ( 28,567) accumulated unused compensated absences should be Operating cost - salaries - 429,714 accrued as expenses at the end of the reporting period. Selling expenses - salaries - 11,946 General and administrative expenses - - 82,227 salaries Research and development expenses - - 47,538 salaries Income tax expense - ( 89,867)
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Increase (Decrease) At transition December 31, Item Explanation Account date 2012 (8) Capital reserve (i) The Company has elected not to apply the Undistributed earnings$ 15,444,316 $ 15,444,316 requirements in IFRS 3, “Business Combinations”, Capital reserve from long-term ( 15,444,316) ( 15,444,316) retrospectively to business combinations and investments investments in associates that occurred prior to the date of transition to IFRSs, and has adjusted the retained earnings on the date of transition to IFRSs for the capital surplus under ROC GAAP that did not meet the regulations of IFRSs.
(ii) In addition, when a subsidiary issues new shares and Capital reserve from long-term - ( 865,524) parent company does not purchase or acquire new investments shares proportionately that results in a change of parent company's ownership percentage and a change of the equity in net assets for the investment that parent company has invested, but that does not result in a loss of control over the subsidiary, in accordance Non-controlling interest - 865,524 with current accounting standards in ROC, such differences shall be used to adjust the “capital surplus —long-term equity investments ”and“long- term equity investments”.
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Increase (Decrease) At transition December 31, Item Explanation Account date 2012 (8) Capital reserve However, in accordance with IAS 27,“Consolidated and Separate Financial Statements”, a change in parent company's ownership interest in a subsidiary that does not result in a loss of control over the subsidiary should be accounted for as transactions with non-controlling interests, and adjustments to the carrying amounts of controlling interests and non-controlling interests should be made to reflect the change in parent company's relative ownership interest in the subsidiary. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in“capital surplus—the difference between the consideration paid or received for acquisition or disposal of the ownership interest in a subsidiary and the carrying amount.
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Increase (Decrease) At transition December 31, Item Explanation Account date 2012 (9) Deferred charges In accordance with current accounting standards in R.O.C., Property, plant and equipment$ 15,101,778 $ 20,165,075 cost of tools is recognized in“Deferred Charges”. However, under IFRSs, it should be recognized in Deferred charges( 15,101,778) ( 20,165,075) “Property, plant and equipment”.
(10) Product warranty costs Under current accounting standards in ROC, the Company Operating cost - 34,382,737 presents product warranty costs in“selling expenses”. Operating expenses - ( 34,382,737) However, under IFRSs, they shall be presented in“cost of goods sold”.
(11) Royalty expenses The Company pays royalties based on the sales volume of Operating cost - 44,570,271 the related product as required by the contract. Under Operating expenses - ( 44,570,271) current accounting standards in ROC, the royalties are presented in“selling expenses”. However, under IFRSs, they shall be presented in“cost of goods sold”.
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Increase (Decrease) At transition December 31, Item Explanation Account date 2012 (12) Income taxes In accordance with current accounting standards in R.O.C., Deferred income tax assets - non-current$ 10,150,273 $ 10,431,693 a deferred tax asset or liability should, according to the classification of its related asset or liability, be classified Deferred income tax assets - current( 8,016,419) ( 6,751,334) as current or noncurrent. However, a deferred tax asset or liability that is not related to an asset or liability for Deferred income tax liabilities - non- 2,133,854 3,680,359 financial reporting should be classified as current or current noncurrent according to the expected period to realize or settle a deferred tax asset or liability. However, under IAS 1, “Presentation of Financial Statements”, an entity should not classify a deferred tax asset or liability as current. In addition, in accordance with current accounting standards in R.O.C., deferred income tax assets and liabilities from the same tax jurisdiction are offset for presentation purpose. However, as the Company's deferred tax assets and liabilities do not meet the criteria of offsetting deferred tax assets and liabilities under IAS 12, “Income Taxes”, they shall not be offset.
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G. Major adjustments for the consolidated statements of cash flows for the year ended December 31, 2012: a) Under R.O.C. GAAP, payment of interest and receipt of interest and dividend are all included in cash flows from operating activities. However, under IFRSs, payment of interest and receipt of interest and dividend are classified as cash flows from financing activities and from investing activities, respectively, when they are the cost for acquisitions of financial resources or the return on investments. b) The transition of R.O.C. GAAP to IFRSs has no effect on the Group’s cash flows reported. c) The reconciliation between R.O.C. GAAP and IFRSs has no net effect on the Group’s cash flows reported.
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VII. Financial Analysis
A. 2013 vs. 2012 Financial Analysis
Unit: NT$Thousand
Difference Year Ratio change Item 2013 2012 analysis and Amount % explanation
Current assets 1,808,581,488 1,536,206,108 272,375,380 17.73% Fund and Long-term equity 46,282,999 41,958,943 4,324,056 10.31% investments Fixed assets 379,561,941 405,155,076 (25,593,135) (6.32%) Other assets 78,034,775 66,917,978 11,116,797 16.61% Total assets 2,312,461,203 2,050,238,105 262,223,098 12.79% Current liabilities 1,358,960,771 1,252,367,888 106,592,883 8.51% Other liabilities 147,575,830 116,956,467 30,619,363 26.18% Note 2 Total liabilities 1,506,536,601 1,369,324,355 137,212,246 10.02% Common stock 131,287,068 118,358,665 12,928,403 10.92% Capital surplus 64,792,873 58,932,078 5,860,795 9.94% Retained earnings 536,880,165 459,771,861 77,108,304 16.77% Total stockholders’ equity 805,924,602 680,913,750 125,010,852 18.36% Note 1: Items will be analyzed and explained if ratio changed more than ±20%. Note 2: Company issued corporate bond for operational needs.
B. 2013 vs. 2012 Operating Result Analysis Unit: NT$Thousand Change Year Amount Variance 2013 2012 percentage Item changed analysis (%) Revenues 3,952,317,540 3,905,395,322 46,922,218 1.20% Cost of revenues (3,697,623,039) (3,655,146,054) 42,476,985 1.16% Gross profit 254,694,501 250,249,268 4,445,233 1.78% Operating expenses (145,380,105) (142,350,998) 3,029,107 2.13% Operating income 109,314,396 107,898,270 1,416,126 1.31% Non -operating income 26,981,301 10,273,815 16,707,486 162.62% Note 1 Income (loss) before 136,295,697 118,172,085 18,123,612 15.34% income taxes Income tax benefit (28,949,821) (26,505,349) 2,444,472 9.22% (expense) Net income (loss) 107,345,876 91,666,736 15,679,140 17.10%
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Note 1: Foreign exchange earning increased because (1) Company owned larger USD foreign currency assets than liabilitie, and TWD depreciated against USD in 2013; (2) Company’s subsidiaries in Chinaowned larger USD foreign liabilities than assets, and RMB appreciated aginst USD in 2013.
C. Cash Flow Analysis
(1) 2013 vs. 2012 Liquidity Analysis
Year 2013 2012 Ratio Change (%) Item
Cash flow ratio (%) 12.71% 13.85% (8.23%)
Cash Flow Adequacy Ratio (%) 87.52% 68.44% 27.88%
Cash reinvestment ratio (%) 13.07% 15.89% (17.75%) Variance Analysis: Cash flow adequacy ratio increased due to lower capital expenditure and long-term investment.
(2) Cash Flow Forecast in 2014
Unit: NT$Thousand Plan for cash ending balance Cash ending Cash beginning Cash flow from operating Cash flow-in shortage balance balance activities (out) Financing (shortage) Investment (1) (2) (3) act (1)+(2)-(3) activities ivities 62,935,975 3,222,947,646 3,264,988,499 20,895,122 -- Cash flow variance analysis for year 2014: (1) Operating activities: company expects revenue and profit will continue to grow. (2) Investment activities: company expects expansion of production facilities to meet business demand. (3) Financing activities: company expects to distribute cash dividends, borrow short-term loans and issue unsecured bonds in 2014.
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VIII. Special Notes
A. Consolidated Financial Statements of Affiliates
Hon Hai Precision Industry Co., Ltd.
Affiliates Consolidated Financial Statement Announcements
From 2012 fiscal year, the companies which should be included in the consolidated financial statements of the Company pursuant to the Affiliates Consolidated Business Reports and Consolidated Financial Statements Preparation of Affiliation Reports are the same as those should be included pursuant to the Statement of Financial Accounting Standards No. 7, and also the affiliates consolidated financial statements should be disclosed information on supra parent company have already been disclosed in the consolidated financial statements of the Company. Therefore the Company will not prepare a separate affiliates consolidated financial statements.
Hereby declare
Company Name: Hon Hai Precision Industry Co., Ltd.
Chairman: Gou, Tai-Ming (Terry Gou)
On the Date of: 3/28/2014
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B. Affiliated Companies Reports:
None
(1) The most recent fiscal year and up to the date of this Annual Report printed, Private Placement Securities:
None
(2) The most recent fiscal year and up to the date of this Annual Report printed, subsidiary companies holding or disposal of the Company’s stock list:
Number Shares as of of the The date Endorsement Loan Source The Number of shares Investment date of Name of Paid-in of the Set amount of amount of Company’s shares or or gains and this Subsidiaries capital acquisition pledge the of the funds ownership amount amount losses Annual or disposal Company Company of Report disposal printed Hongjing International Own 130,821 1,433,093 20,000,000 100% 2012 N/A N/A N/A N/A N/A Investment funds Shares Shares Co., Ltd.
(3) Other supplementary information:
None
(4) Matters affect the shareholders’ equity or the price of securities:
None
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Hon Hai Precision Industry Co., Ltd.
Chairman: Gou, Tai-Ming (Terry Gou)
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