Announcement of effects of FENC’s financial reports to change in accounting policy
From：
1.Date of the board of directors resolution:2014/05/13
2.The nature of the change:Amendments of accounting policy
3.Reason for the change:
The measurement subsequent to initial recognition of investment
properties will be altered to fair value model
4.The prior periods affected by retrospective application of the new
accounting policy:2014/01/01
5.The line items affected and the actual effect for the immediately
preceding financial year:
1)Effects on 2013 Consolidated Statements of Comprehensive Income:
“Gain on revaluation of investment property” increased by
NT$6,421.2 million, “share of the profit or loss of associates”
increased by NT$786.7 million, “depreciation expense” decreased
by NT$158 million, “loss on disposal of investment properties”
decreased by NT$0.5 million, “income tax expense” increased by
NT$709 million, for a total “net income” increased of NT$6,657.4
million.
2) Effects on Consolidated Balance Sheets as of December 31st, 2013:
“Investment properties” increased by NT$78,151 million, “property,
plant and equipment” increased by NT$306 million, “investments
accounted for using the equity method” increased by NT$8,187 million,
“deferred tax liabilities” increased by NT$2,875 million, “total equity”
increased by NT$83,769 million, of which NT$80,487 million are
“attributable to owners of the company”.
6.The actual effect on the opening balance of retained earnings for the
immediately preceding financial year:
Returned earnings increased by NT 74,455 million as of 2013/01/01
7.The reasonableness and necessity for the change in accounting policy or
accounting estimate after the beginning of the financial year:
To reflect the fair value of FENC’s investment property, according
to the amendments of articles of “Regulations Governing the Preparation
of Financial Reports by Securities Issuers”, the measurement subsequent
to initial recognition of the Company’s investment properties will be
altered to fair value model.
8.If retrospective application is impracticable, specify the reasons, how
and from when the accounting policy change be applied:None
9.If retrospective application is impracticable, CPA provides the opinion
about the impact of the audit opinion for the financial year preceding the
accounting change:None
10.About the reasonableness of the item 2 to 9, the itemized analysis and
reviewed opinion from CPA:
The CPA has reviewed in accordance with Article 6 of “Regulations Governing
the Preparation of financial Reports by Securities Issuers” and issued an
opinion on the change in accounting policy is fair and reasonable.
11.Objection or reservation opinion from the independent directors:None
12.Countermeasures:
During the board of directors’ meeting on March 19, 2014, the board of
directors resolved to approve the alteration of the measurement subsequent
to initial recognition to fair value model. This change will be effective
starting from 2014 and any subsequent changes will be in correspondence to
the articles of “Regulations Governing the Preparation of Financial Reports
by Securities Issuers”.
13.Any other matters that need to be specified:None
