2012 Annual RPT e

Stock Code 2317
HON HAI PRECISION INDUSTRY CO., LTD.
Annual Report 2012
Annual Report Website Market Observation Post System: http://mops.twse.com.tw Company Website: http://www.foxconn.com.tw Printing Date: April 30, 2013
THIS IS A TRANSLATION OF THE 2012 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.
I. Spokesperson: Name: Simon Hsing Title: Spokesperson Tel: (02)2268-3466#3629
Deputy Spokesperson: Name: Jack Hsiao Title: Director of Public Relations Office Tel: (02)2268-3466#3628
E-mail: stockaffairs@foxconn.com
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
III. Share Transfer Agency Name: Address: Tel: Website: Grand Fortune Securities Co., Ltd. 3F, No. 51, Section 1, Minsheng East Road, Taipei City (02)2562-1658 http://www.gfortune.com.tw
IV. Contact information of the Certified Public Accountants for the Latest Financial Repot Name: CPA Firm: Address: Tel: Website: Hsu, Yong-jian, Xue, Ming-ling Pricewaterhouse Coopers (PwC) Taiwan 27F, No. 333, Section 1, Keelong Road, Taipei City (02)2729-6666 http://www.pwc.tw
V. Overseas trade places for listed negotiable securities London Stock Exchange: http://www.londonstockexchange.com
Singapore Stock Exchange: http://www.sgx.com/wps/portal/marketplace/mp-ch/home
VI. Company Website:
http://www.foxconn.com
Table of Contents
I. II. Letter to Shareholders.................................................................................................................. 1 Company Introduction ................................................................................................................. 3 A. Founding date: February 20, 1974............................................................................................... 3 B. Formation History ....................................................................................................................... 3 III. A. B. C. D. E. Corporate Governance Report ..................................................................................................... 9 Organization ................................................................................................................................ 9 Implementation of corporate governance .................................................................................. 31 Information on Accountants Fees ............................................................................................ 49 Alternation of CPA .................................................................................................................... 49 The Companys 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: .......................................................... 49 F. Transfer & pledge of stock equity by directors, supervisors, managerial officers and holders of 10% or more of company shares: ............................................................................. 50 G. Information on relation among top ten shareholders ................................................................. 52 H. Combined shareholding percentage........................................................................................... 53 IV. A. B. C. D. E. F. Company Shares and Fund Raising ........................................................................................... 54 Company capital and shares ...................................................................................................... 54 Section on Corporate Bonds ...................................................................................................... 63 Preferred Shares (with warrants): .............................................................................................. 67 Global Depository Receipts (GDR) ........................................................................................... 67 Subscription of warrants for employees: ................................................................................... 68 Name of managers holding warrants for employees and top ten employees in terms of subscription of warrants, and the acquisition status: ................................................................. 69 G. Subscription of new shares for employee restricted stocks: ...................................................... 69 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: ..................... 69 I. Issuance of new shares for merging and transferring the stocks of other companies: ............. 69 J. Implementation of fund usage plan: .......................................................................................... 69 V. A. B. C. D. VI. A. B. C. D. VII. Operational Highlights .............................................................................................................. 70 Business Activities .................................................................................................................... 70 Production and Sales Status....................................................................................................... 72 Information on Environmental Protection Costs ....................................................................... 75 Labor Relations ......................................................................................................................... 76 Financial Standing ..................................................................................................................... 81 Most Recent 5-Year Concise Financial Information ................................................................. 81 Most Recent 5-Year Financial Analysis .................................................................................... 85 Audit Report by Supervisors ..................................................................................................... 89 2012 Financial Statements Consolidated With Subsidiaries Audited by CPA .......................... 91 Financial Analysis ................................................................................................................... 237
A. 2012 vs. 2011 Financial Analysis ............................................................................................ 237 B. 2012 vs. 2011 Operating Result Analysis ............................................................................... 237 C. Cash Flow Analysis ................................................................................................................. 238 VIII. Special Notes ........................................................................................................................... 239 A. Consolidated Financial Statements of Affiliates ..................................................................... 239 B. Affiliated Companies Reports: ................................................................................................ 240
I.
Letter to Shareholders
Although the political and economic environments are so turbulent, the industrial aspects also have been through tremendous changes, our Company has gained better performance since last year, the consolidated revenue and profit once both hit record highs! On behalf of the Board of Directors of the Company, I want to thank all my colleagues for their hard working and dedicated contributions. Once again, I sincerely thank our strategic partners and customers for their continued trust and also thank all the shareholders of the Company for their long-term support. The international economic environment of 2012 was again precarious. From the very beginning of 2012, although the United States government extended the low interest rate policy to stimulate the economy, the debt problems of Greece, Italy and Spain expanded and once again triggered a debt crisis in Europe, which restrained the global economic recovery. The presidential elections of many countries were in the second half of 2012, the uncertainty of which created a more unpredictable situation around the world. Especially, the U.S. fiscal cliff problem has lowered global consumer confidence significantly, and bogged down economic development. Fortunately, after the U.S. Federal Reserve Board initiated the third and fourth quantitative easing monetary policy, the tension of the global economy has been eased. Despite operating in such a difficult business environment, under the concerted efforts of all my colleagues our Company not only achieved excellent performance results but also earned our remarkable reputation around the world: According to the U.S. Fortune Global 500 ranking report, our Company has moved up to the next level, from 60th in 2011 to once again advance to 43rd last year. In addition, our Company has already obtained 2,013 U.S. patents in 2012, ranking 8th in the whole world. We have proved Hon Hais strong competitive strength once again. Looking forward to 2013, the steady growth of the U.S. economy may gradually lead the global economic recovery, but while the U.S. deficit reduction programs take effect automatically, whether the debt ceiling can be increased and other issues will affect consumer confidence. Meanwhile, the most important is that the U.S. policy of quantitative easing may exit in the second half of this year, it will be a big challenge weather the economy is capable of sustained recovery at that time. In addition, high unemployment rates and low growth rates persist in the European market, new developing countries face different issues such as inflation, unemployment, growth slows etc., coupled with the rapid changes in the ecological structure of the technology industries, 2013 is still full of uncertainty. In view of this, in addition to continuous investment in research and development of different areas of science and technology, our Company is committed to efficiency, automation, unmanned productions and globalization to enable our Company to continue to take the leading position in the eight-screens-one-network-one-cloud business territory. The Group describes 2013 as a key year, and looks forward to extend the business from core manufacturing and technology to technology services which the development goal is to go through from the first mile to last mile. We are confident that even though the overall business recovery cycle is still highly uncertain, we will be able to break through all the difficulties and challenges to bring you all more value!
Once again, on behalf of all shareholders of the Company, I sincerely thank all the employees and their families. I also encourage the Companys management team continue to work hard to maintain the excellent operating results. Thank you so much for all your support.
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
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 & Poors (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.
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 Worlds 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).
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 Worlds Top 10 Chinese Enterprises of the Year by Asiaweek. 6. Ranked 154th 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 132nd 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 109th among Fortune Global 500 Enterprises.
6
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 Asias 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 176th 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 194th among the Global 500 Enterprises by (Britain) Financial Times. 8. Ranked 112th 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 189th 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 60th among Fortune Global 500 by Fortune. 7. Awarded the Most Admired Enterprise in Taiwan by Common Wealth. In 2012 1. Increased capital to NT$108,358,665,270. 2. Issued NT$16,300,000,000 of domestic unsecured ordinary corporate bonds.
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 43rd among Fortune Global 500. 6. Ranked 156th among Forbes Global 2000.
CCPBG Business Group
CESBG Business Group
CMMSG Business Group Compensation Committee
Internal Audit Division Executive Secretary Chairmans Office
CNSBG Business Group
Supervisors
iDPBG Business Group
iDSBG Business Group
NWInG Business Group
Shareholders Meeting
Board of Directors
Chairman
President
PCEBG Business Group
SHZBG Business Group
F&A and Investment Management Division
Global R&D Center
System information Division
Corporate Governance Report
Global Procurement Division
(1) Organization Chart
Global Legal Division
III.
A. Organization
Human Resources Division
(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
(3) Directors and Supervisors Date: 04/28/2013

Title Name Shares held when Date of Term First elected Election of Elected (appoint Office Date ment) Number % Jun. 8, 2010 Jul. 1, 2010 Jun. 8, 2010 Jul. 1, 2010 Shares currently Shares held in held by their Current shareholding the name of spouses and others minor children Number % Number % Number % Graduated from China Marine Technical College Director of Taiwan Electrical 0 Equipment Association, Chairman of Mold Industry Association Main working (education) experience Current positions in the Company and other companies Spouse or second-degree relative holding a position as key manager, director or supervisor Relatio Title Name n None None None
Chairman
Gou, Tai-ming (Terry Gou)
Feb. 20, 925,961,760 1974
10.79 1,473,989,536
12.45
None
Hon Chiao International Investment Co., Ltd
None 3 Jun. 10, 1995 13,767,634 0.16 18,657,897 0.16 0 0 0 0 None None
None
None
Director Jun. 8, Representative: 2010 Tai, Jeng-wu Jul. 1, 2010 3 Jul. 1, 2001 8,399,832 0.09 10,869,951 0.09 905,138 0
President of Shenzhen Fujun Material Technology Co., Ltd. President of Futaijie Science and Technology Development (Shenzhen) Co., Ltd. Tatung Institute of Technology, Director of Fuhongyuan Environmental 0 Technology (Shenzhen) Co., Ltd. Taiwan Representative of directors of Xinxi Technology (Stock) Company Representative of Fitipower Integrated Technology Inc.
None
None
None
Director
Hon Chiao International Investment Co., Ltd
Jun. 8, 2010 Jul. 1, 2010
None 3 Jun. 15, 1998 13,767,634 0.16 18,657,897 0.16 0 0 0 0 None None
None
None
Jun. 8, Representative: 2010 Lu, Sung-ching Jul. 1, 2010 Hon Jin International Investment Co., Ltd Jun. 8, 2010 Jul. 1, 2010
None 3 Feb. 21, 2000 20,470,434 0.23 17,120,384 0.14 3,097 0 0 Masters Degree, University of 0 Illinois, U.S.A None
None
None
None 3 Jun. 8, 2007 961,344 0.01 1,302,812 0.01 0 0 0 0 None None
None
None
Director
11
Title
Name
Shares held when Date of Term First elected Election of Elected (appoint Office Date ment) Number %
Shares currently Shares held in held by their Current shareholding the name of spouses and others minor children Number % Number % Number %
Main working (education) experience
Current positions in the Company and other companies
Jun. 8, Representative: 2010 Lu, Fang-ming Jul. 1, 2010 Hon Jin International Investment Co., Ltd
Jun. 8, 2010
3,120,623
0.04
6,344,859
50.05
1,535,802 0.01
Masters Degree of Institute of Applied Physics, Chung Yuan Christian University Taiwan General Manager of Asia0 Pacific Region, Lingyun Science None and Technology Co. Ltd. General Manager of Taiwan Computer System, Hewlett Packard
Spouse or second-degree relative holding a position as key manager, director or supervisor Relatio Title Name n None None None
Director
Jun. 8, 2010 Jul. 1, 2010
None 3 Jun. 8, 2007 961,344 0.01 1,302,812 0.01 0 0 0 0 None None
None
None
Jun. 8, Representative: 2010 Chien, Yi-bin Jul. 1, 2010 Independent Wu, Yu-Chi Director Jun. 8, 2010 Jul. 1, 2010
Jun. 8, 2007
1,6,83,250
0.02
1,589,324
0.01
Supervisor of Bao Xin International International trade department of Investments Co., Ltd. Tamkang University Director of Expressive Profits Incorporated
None
None
None
Jun. 8, 2010
President of Ji-Tou United Accountant Firm Masters Degree in Accounting, S u p e r v i s o r o f I - S h e n g E l e c t r i c National Taiwan University Wire & Cab le Co., Ltd . 0 Bachelor degree in accounting, Supervisor of Procystal Technology Co., Tunghai University Ltd. Masters Degree in Finance, National Taiwan University
None
None
None
Jun. 8, Independent Liu, Cheng-Yu 2010 Director Jul. 1, 2010 Fu-Rui International Investment Co., Ltd. Jun. 8, 2010 Jul. 1, 2010
Jun. 8, 2007
Attorney of I-Si Technology Law Firm
None
None
None
Jun. 15, 1998
41,718,123
0.49
56,536,398
0.48
0 None
None
None
None
None
Supervisor
Jun. 8, Representative: 2010 Wan, Jui-hsia Jul. 1, 2010
Jun. 10, 2004
14,706
0.00
Masters Degree in Accounting, Soochow University Supervisor of Cheng Uei Precision Industry 0 Deputy professor, Department Co., Ltd. of Account, National Taiwan University
None
None
None
12
Title
Name
Shares held when Date of Term First elected Election of Elected (appoint Office Date ment) Number %
Shares currently Shares held in held by their Current shareholding the name of spouses and others minor children Number % Number % Number %
Main working (education) experience
Current positions in the Company and other companies
Spouse or second-degree relative holding a position as key manager, director or supervisor Relatio Title Name n
Supervisor
Huang, QingYuan
Jun. 8, 2010 Jul. 1, 2010
Jun. 8, 2007
1,161,318 0.01
Masters Degree, Graduate School of Business, Nihon 0 University, Japan PhD, Graduate School of Business, Nihon University
Independent Director of Cathay Financial Holdings Independent Director of Cathay Life Insurance Independent Director of Cathay Securities Corporation Independent Director of Cathay United Bank Supervisor of Maishi Venture Capital Investment Co., Ltd. Director of DFI Inc. Director of Taiwan Stock Exchange Corporation (TWSE) Independent Director of TAIWANGLASS GROUP Supervisor of Maishi #2 Venture Capital Investment Co., Ltd. President of WeiHeng Asset Management Co., Ltd
None
None
None
13
(4) Major shareholders of institutional shareholders Date: 04/28/2013

Name of Institutional Shareholder Hongqiao International Investment Co., Ltd. Shijun International Investment Co., Ltd. Hongyuan International Investment Co., Ltd. Hongjing International Investment Co., Ltd. Hongqi International Investment Co., Ltd. Xu Muji Furui International Investment Co., Ltd. Chien, Yi-bin 0.17% 50% 99.83% 9.01% 50% Name of Major Shareholders Outstanding Growth Ltd., British Virgin Islands Percentage 90.99%
(5) Principal shareholder of corporate shareholders with a juridical person as its main shareholder
Name Outstanding Growth Ltd., British Virgin Islands Shijun International Investment Co., Ltd. Major shareholders INB Holdings Limited Great Century International Limited Percentage 100% 100% 100% 100%
Hongyuan International Investment Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hongqi International Investment Co., Ltd. Hon Hai Precision Industry Co., Ltd.
14
(6) Professional knowledge and independence check matrix of directors and supervisors
Qualification Has over five years work experience and following 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 Lecturer or above in Professionals Accounting or Name Colleges in Related Related Work departments Experience Gou, Tai-ming 0 Tai, Jeng-wu 0 Lu, Sung-ching 0 Lu, Fang-ming 0 Chien, Yi-bin 0 Wu, Yu-Chi 0 Liu, Cheng Yu 0 Huang, Qing-Yuan 3 Wan, Jui-hsia 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 persons 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.
15
(7) Management Team Information Date: 04/28/2013

Shareholding Title Name Inaugura tion date Number % Currently Holding holding shares of shares in the spouses and name of minor children others Number % Number % Graduated from China Marine Technical College Director of Taiwan Electrical 0 None Appliances Equipment Association Chairman of Mold Industry Association Spouse or seconddegree relative holding a position as manager
Main experience (education experience)
Current positions at other companies
Title Name Relation
Chairman and President
Terry Gou
Feb. 20, 1989
1,473,989,536 12.45
None None
None
Department Tai, Aug. 1, General Jeng-wu 1992 Manager
10,869,951 0.09
905,138 0.01
Tatung Institute of Technology, Taiwan
President of Shenzhen Fujun Material Technology Co., Ltd. President of Futaijie Science and Technology Development (Shenzhen) Co., Ltd. Director of Fuhongyuan Environmental None None Technology (Shenzhen) Co., Ltd. Representative of directors of Xinxi Technology (Stock) Company Representative of Fitipower Integrated Technology Inc.
None
Department Lu, General SungManager ching
Aug. 1, 1992
17,120,384 0.14
3,097 0.00
Masters Degree, University of Illinois, U.S.A.
None
None None
None
16
Shareholding Title Name Inaugura tion date Number %
Currently Holding holding shares of shares in the spouses and name of minor children others Number % Number %
Spouse or seconddegree relative holding a position as manager
Title Name Relation
Department You, May 27, General Xiang-fu 1992 Manager
36,643,284 0.31 57,169,569 0.48
President of Huaian Fulitong Trade Co., Ltd. President of Qunkang Electronics (Kunshan) Co., Ltd. Graduated from Tamsui Institute of 0 President of Fuyu Energy Technology None None Business Administration, Taiwan (Kunshan) Co., Ltd. President of Fuyu ElectronicTechnology (Huaian) Co., Ltd.
None
Department Lu, General FangManager ming
Apr. 1, 2003
6,344,859 0.05 1,535,802 0.01
Masters Degree of Institute of Applied Physics, Chung-Yuan Christian University Taiwan General Manager of Asia0 None Pacific Region, Lingyun Science and Technology Co., Ltd. General Manager of Taiwan Computer System, Hewlett Packard
None None
None
17
Title Name Relation
Department Jiang, General HaoManager liang
May 1, 2005
2,958,872 0.02
Univ. of Birmingham. UK Bachelor of EE
None
None None
None
Department Chien, General Yi-bin Manager
Jun. 1, 2005
1,589,324 0.01
International Trade Department of Tamkang University, Taiwan
Director of Expressive Profits Incorporated Representative of supervisors of Baoxin International Investment (Stock) Company
None None
None
Department Xu, General Mu-ji Manager
Jun. 1, 2005
9,365,774 0.08
Graduated from National Chin-Yi University of Technology, Taiwan
President of Hongzhun Precision Tooling (Kunshan) Co., Ltd. President of Hongzhun Precision Tooling (Shenzhen) Co., Ltd.
None None
None
18
Title Name Relation
Department Zhong, General Yi-wen Manager
Jan. 1, 2007
186,045 0.00
Bachelor degree in economics, Iowa State University, U.S.A. 0 Manager of Hon Hai Precision Industry (Stock) Company
President of Hongfujin Precision Industry (Shenzhen) Co., Ltd.
None None
None
Department Ling, Jan. 21, General Zhi-ping 2009 Manager
1,808,065 0.02
Enterprise Research Institute of University of Washington, U.S.A. 0 School of Business, Taiwan University
President of Amworld Microsystems (Shanghai) Ltd. President of Ambit Microsystems (Shanghai) None None Ltd. President of Ambit Microsystems (Zhongshan) Ltd.
None
Deputy Xiong, Department BingGeneral zheng Manager
Aug. 31, 2008
894,861 0.001
120,110 0.00
Director of Foxconn Precision Electronics (Yantai) Co., Ltd. Industrial Management Department Director of Jing Fu Tai Precision Electronics (Yantai) Company Limited of Taiwan Institute of Industrial Director of Fu Hongyuan (Shenzhen) 0 Skills None None Industrial Engineering Department Company Limited Director Environmental of Taiwan Institute of Technology Technology Director of Hongfujin Precision Electronics (Yantai) Co., Ltd. Director of Yantai Fuhuada Precision Electronics Co., Ltd. Director of Competition Optical Technology Ltd. Director of Competition Team Ireland Ltd. Director of Competition Team Technology Pte. Ltd. Director of Dominant Elite Holding Ltd. Director of Foxconn Baja California S.A. de 19 C.V. Director of Famous Rise International Ltd. Director of Universal Field International Ltd.
None
Title Name Relation President of Fertile Plan International Logistics (Vietnam) Co., Ltd Director of Foxconn (Far East) Ltd.(Cayman) Director of Foxconn (Far East) Ltd.(HK) Director of Foxconn International Holdings None None Ltd. Board director of Foxconn Japan Co., Ltd. Director of Foxteq Holdings Inc. Director of Foxteq Integration, Inc.(Cayman) of Foxteq Investments Ltd. Venture Director and president of Hongyang Director of FUCHUAN CO., Ltd. Capital Investment (Stock) Company Director of FUHONG Precision Component Representative of directors of Hongqi (Bac Giang) LTD. International Investment (Stock) Company Director of FUNING Precision Component None None Representative of directors of Baoxin Co., LTD. Investment (Stock) Company International Director of KCT Ltd. Representative ofEngineering supervisors Co., of Hongjing Directors of Liyi International Investment International Investment (Stock) Company (Stock) Company Representative of supervisors of Liyi Directors ofFAST Hongyuan International International Investment (Stock) Company Director of VICTOR LIMITED Investment (Stock) Company Representative of supervisors of Hongyuan Director of Focus PC Enterprises Limited. Director of of Hongjing International Investment International investment (Stock) Company Supervisor FUCHUAN CO., LTD. (Stock) Company Supervisor of Pan-International Industrial Director of Full Bonus International Limited Directors ofFUYONG Hongqi International Corporation Director of CO., LTD Investment None None (Stock) Company Representative of Supervisors of CyberTAN Director of Glory Star Investments Limited. Supervisors of Hongyang Venture Capital Technology, Inc. Director of Great Name Investments Limited Investment (Stock) Company Shenzhen Fuxuntong Trading Co., Director of Great World Technology Pte. Ltd. Director of Precision HOLDINGS Industry Ltd. Director of Hongfujin HIGH PRECISION (Shenzhen) LIMITED Co., Ltd. President of Shenzhen Futaitong Co., International Supervisor of KCT Engineering Ltd. Logistics Co., Ltd. Director of Keep Profit Investment Limited Director of Mega Star Investments Limited Director METRO VICTORY LIMITED Director of Operate Technology Limited Director of Precision Technology Investments Pte. Ltd. Director of Tongrand Limited
Head Office General Manager
Li, Oct. 17, Jin-ming 1997
237,373 0.00
Graduated from National Chengchi University, Taiwan Deputy general manager of Huafei 0 Color Display System (Stock) Company Manager of Taiwan Philip (Stock) Company
None
Financial Director
Huang, De-cai
Apr. 15,1998
2,655,813 0.02
Graduated from National Chiao Tung University, Taiwan Financial director of Vanguard 0 International Semiconductor Corporation Manager of Taiwan Philip (Stock) Company
None
Accounting Chou, Jul. 20, Director Zong-kai 2010
61,750 0.00
Masters Degree in accounting, Long Island University Manager of Deloitte & Touche, 0 Taiwan Lecturer of Hsing Wu University , Taiwan
None
20
(8) Remunerations paid to directors, supervisors and management team in the latest year (a) Director Remuneration Unit: NT$Thousand
Title Director Juristic Director Hon Chiao International Investment Co., Ltd. Juristic Director Representati ve Tai, Jengwu Juristic Director Representati ve Lu, Sungching Juristic Director Hon Jin International Investment Co., Ltd. 3,600 3,600 0 0 0 0 480 480 0.00% 0.00% Juristic Director Representati ve Lu, Fangming Juristic Director Representati ve Chien, Yibin Independent Director Independent Director
Name
Gou, Taiming (Terry Gou) The Company Remunerations (A) All companies within the consolidated financial statements The Company Retirement allowance (B) All companies within the consolidated financial statements The Company All companies within the consolidated financial statements The Company All companies within the consolidated financial statements The Company All companies within the consolidated financial statements
Wu, Yu-Chi
Liu, ChengYu
Remuneration of Directors
Remuneration from distribution of earnings (C) Business execution expenses (D)
Proportion of A, B, C and D to net profit after tax
21
Remuneration, money award and special expenses etc. (E)
The Company All companies within the consolidated financial statements The Company
25,674 25,674 0 0
Retirement allowance (F)
All companies within the consolidated financial statements The Company Cash Dividends Stock Dividends Cash Dividends Stock Dividends
0 213,283 0
Relevant remuneration of part-time personnel
Employee profit sharing from earnings distribution (G)
All companies within the consolidate d financial statements The Company
213,283 None None None None 0.26% 0.27% No
Number of stock certificates of employee (H) Number of shares of Employees Restricted Stock (I)
All companies within the consolidated financial statements The Company All companies within the consolidated financial statements The Company All companies within the consolidated financial statements
Proportion of A, B, C, D, E, F and G to net profit after tax
Is there any remuneration from other invested businesses apart from subsidiaries
22
Range of Remunerations
Names of directors Range of Remunerations paid to directors Summation of the first 4 items (A+B+C+D) All companies involved in The Company financial statement (I) Terry Gou, Hon Chiao Terry Gou, Hon Chiao International Investment Co., International Investment Co., Ltd., Tai Jeng-wu, Lu SungLtd., Tai Jeng-wu, Lu Sungching, Hon Jin International ching, Hon Jin International Investment Co., Ltd., Lu Fang- Investment Co., Ltd., Lu Fangming, Chien Yi-bin ming, Chien Yi-bin Wu Yu-Chi, Liu Cheng-Yu Wu Yu-Chi, Liu Cheng-Yu Summation of the first 7 items (A+B+C+D+E+F+G) All companies in the financial The Company statement (J) Terry Gou, Hon Chiao International Investment Co., Ltd., Hon Jin International Investment Co., Ltd. Terry Gou, Hon Chiao International Investment Co., Ltd., Hon Jin International Investment Co., Ltd.
Under NT$2,000,000
NT$2,000,000 (included) ~ NT$5,000,000 (excluded)
Wu Yu-Chi, Liu Cheng-Yu
Wu Yu-Chi, Liu Cheng-Yu
Chien Yi-bin
Chien Yi-bin
Lu Sung-ching
Lu Sung-ching
Tai Jeng-wu
Tai Jeng-wu
Over NT$100,000,000
Lu Fang-ming
Lu Fang-ming
Total
23
(b) Remunerations of Supervisors Unit: NT$Thousand

Remuneration of supervisors Remunerations (A) Title Name The Company All companies in the financial statement The Company All companies in the financial statements The Company All companies in the financial statements The Company All companies in the financial statements Remuneration from earnings distribution (B) Business execution expenses (C) Proportion of A, B and C to net profit after tax Is there any remuneration from other invested businesses apart from subsidiaries
Supervisor
Huang, Qing-Yuan Fu-Rui International Investment Co., Ltd. Representative: Wan Jui-hsia 3,600 3,600 0 0 480 480 0.0043% 0.0044% No
Supervisor
24
Name of Supervisor Range of Remuneration Paid to Supervisors Summation of the first three items (A+B+C) The Company Under NT$2,000,000 Fu-Rui International Investment Co., Ltd. Representative: Wan Jui-Hsia Qing-Yuan Huang All companies in the financial statement (D) Fu-Rui International Investment Co., Ltd. Representative: Wan Jui-Hsia Qing-Yuan Huang
NT$2,000,000 (included) ~ NT$ 5,000,000 (excluded)
Over NT$100,000,000
Total
25
(c) Remunerations paid to the management team Unit: NT$Thousand

Remuneration from other invested businesses apart from subsidiaries. None Rate of total Money award and Earning distribution as dividends amount of A, B, Remunerations Retirement special payment for personnel (D) C and D to pure (A) allowance (B) etc. (C) (Note) profits after tax (%) All companies involved in The Company financial statement All companies in the financial statement All companies in the financial statement All companies in the financial statement The Company The Company The Company The Company Cash Dividends Stock Dividends Cash Dividends Stock Dividends Number of stock certificates of employee All companies in the financial statement Number of shares of Employees Restricted Stock
Title
Name
General Manager Department General Manager Department General Manager Department General Manager Department General Manager Department General Manager Department General Manager Department General Manager
Terry Gou Lu, Sung-ching You, Xiangfu Tai, Jeng-wu Lu, Fangming Jiang, Hao-liang Chien, Yi-bin Xu, Mu-ji 23,340 23,340 0 0 44,165 44,165 0 356,087 0 356,087 0.447% 0.462% None None None None
26
All companies in the financial statement
All companies in the financial statement
The Company
The Company
Department General Manager Department General Manager Deputy Department General Manager Head Office General Manager Financial Director Accounting Director
Zhong, Yi-wen Ling, Zhi-ping Xiong, Bing-zheng Li, Jin-ming Huang, De-cai Chou, Zong-kai
Note: NT$6,822,891Thousand of earnings were distributed to employees as dividends in 2012 according to the resolution of board of directors. In this year, the actual distribution rate will be considered for distributing dividends.
27
Names of General Managers and Deputy General Managers Range of remuneration paid to the management team The Company Under NT$2,000,000 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$100,000,000 Total Chien Yi-bin Lu, Sung-ching, Jiang Haoliang, Huang Decai, Li Jinming Tai, Jeng-wu, Ling Zhiping Lu, Fang-ming 14 Terry Gou, You Xiangfu, Xu Muji Zhong Yiwen Xiong Bingzheng, Chou Zongkai Chien Yi-bin Lu, Sung-ching, Jiang Haoliang, Huang Decai, Li Jinming Tai, Jeng-wu, Ling Zhiping Lu, Fang-ming 14 All companies in the financial statement (E) Terry Gou, You Xiangfu, Xu Muji Zhong Yiwen Xiong Bingzheng, Chou Zongkai -
28
(d) Employee profit sharing granted to the management team Unit: NT$Thousand
Title General manager Department General Manager Department General Manager Department General Manager Department General Manager Management Team Department General Manager Department General Manager Department General Manager Department General Manager Department General Manager Department Vice President Head Office General Manager Financial Director Accounting Director Name Terry Gou Lu, Sung-ching You, Xiang-fu Tai, Jeng-wu Lu, Fang-ming Jiang, Hao-liang Chien, Yi-bin 356,087 Xu, Mu-ji Zhong, Yi-wen Ling, Zhi-ping Xiong, Bing-zheng Li, Jin-ming Huang, De-cai Chou, Zong-kai 0 356,087 0.376% Stock Dividends Cash Dividends (Note) (Note) Total Pro po rtio n o f to ta l a mo unt to net pro f its a fter ta x ( %)
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.
29
(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.
Item Title Proportion of the total compensation to net profit after tax 2012 2011 All companies in All companies in the consolidated The Company the consolidated The Company financial financial statement statement 0.256% 0.004% 0.447% 0.265% 0.004% 0.461% 0.261% 0.005% 0.561% 0.260% 0.005% 0.559%
Directors Supervisors General Manager and Deputy 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. 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 Companys 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. According to the Companys policy for payment of compensation, reasonable compensation shall be paid based on job evaluation of the personnel in the Company.
(ii)
(iii)
30
B. Implementation of corporate governance

(1) Information on implementation of Board of Directors Five meetings were held by the Board of Directors in the recent year (2012) with their attendance shown as follows:
Title Chairman Name Terry Gou Representative of Hon Chiao International Investment Co., Ltd.: Tai, Jeng-wu Representative of Hon Chiao International Investment Co., Ltd.: Lu, Sung-ching Representative of Hon Jin International Investment Co., Ltd.: Lu, Fang-ming Representative of Hon Jin International Investment Co., Ltd.: Chien, Yi-bin Wu, Yu-Chi Attendance in person 2 By proxy 2 Attendance rate Remarks in person (%) 40 -
Director
60
Director
40
Director
100
Director Independent Director
0 5
1 0
0 100
Independent Liu, Cheng-Yu 5 0 100 Director Other noteworthy matters: 1. Matters specified in Article 14.3 of Taiwans 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.
(2) Operation status of Audit Committee: The Company does not have an audit committee.
31
(3) Participation of supervisors in the operation of the Board of Directors: Five meetings were held by the Board of Directors in the recent year (2012) with the attendance of supervisors shown as follows:
Title Supervisor Supervisor Name Representative of Fu-Rui International Investment Co., Ltd.: Wan, Jui-hsia Huang, Qing-Yuan Attendance in person 5 4 By proxy (%) 100 80 Remarks -
Other noteworthy matters: 1. Organization and responsibilities of supervisors (a) Communication of between supervisors with and the Companys employees and shareholders: Supervisors regard direct connection and dialogue with the Companys 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 supervisors opinion: None.
32
(4) Corporate governance implementation and the difference from the Corporate Governance Best Practice Principles for TWSE/GTSM-Listed Companies and reasons
Di ffere nc e fro m co rp o rat e go ver n a nce p ract ice p ri nc ip l e s fo r T W SE/GT S M - Li s ted co mp a ni es a nd re a so ns In conformity with the corporate governance practice principles
Item
Operation
1. Equity structure and shareholder rights (1) How the Company handles shareholder suggestions of shareholders and disputes. (2) Companys control of the list of its major shareholders and final decision-makers (3) How the Company establishes its risk management mechanism and firewalls involving related enterprises.
2. Organization and responsibilities of the Board of Directors (1) Establishment of Independent Directors (2) Regular assessment on independence of CPA III. Establishment of communication channels with materially related parties
In conformity with the corporate governance practice principles In conformity with the 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 Companys 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 Companys 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. doesnt set up such functional commissions as Nomination Committee and Audit Committee.
1. An investor relation office was set up to deal with shareholder suggestions and disputes. 2. The Company can control the list of its major shareholders and final decision-makers, and disclose them legally. 3. The Company, according to such relevant internal methods as operating methods for operating, service and financial operations with specific 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. 1. Two Independent Directors were selected at the General Shareholder Meeting in 2010. 2. Carry out regular assessment on independence of CPA. Direct communication and dialogue with stakeholders shall be done when supervisors regard it necessary.
33
Di ffere nc e fro m co rp o rat e go ver n a nce Item Operation p ract ice p ri nc ip l e s fo r T W SE/GT S M - Li s ted co mp a ni es a nd re a so ns 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. 7. Other important information for better understanding the Companys 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 Companys directors are qualified with industri al 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 Companys directors and supervisors: liability insurance has been covered for directors and su pervisors. 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: NA.
34
(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. Business, Legal Affairs, Finance, Accounting, Lecturer or above in Colleges in Related departments J ud ge, P ro sec u to r, Att o r ne y, CP A o r Nat io na l Cer ti fied P ro fe s sio n al s Business, Legal Affairs, Finance, Accountin g or Related Work Experienc e Independence Attribute (Note 2)
Conditions ID (Note 1) Name
Current Remarks positions at (Note 3) other companies
Independent Director Independent Director Director
Wu, Yu-Chi Liu, Cheng-Yu Lu, Fang-ming
0 0 0 Yes
Note 1: For ID column, please fill in director, Independent Director or others. Note 2: If the member complies with the following conditions from 2 years before being elected and during his tenure in offic e, please mark in the corresponding space. (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 shareholders 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. Note 3: If the member is a director, please explain whether it complies with Article 6.5 of the Regulations Governing the Appointment and Exercise of Powers by the Compensation Committee of a Company Whose Stock is listed on the Stock Exchange or Traded over the Counter.
35
(b) Operation status of the Compensation Committee (1) There are 3 members in the Companys Compensation Committee. (2) Current Term: From September 30, 2011 to June 30, 2013. The Compensation Committee held two meetings (A) in the recent year (in 2012), the qualifications and attendance of the Committee are shown as follows:
Attendance rate in person (%) (B/A) (Note)
Title
Name
Attendance in person (B)
By proxy
Remarks
Convener Wu, Yu-Chi 2 0 100 Member Liu, Cheng-Yu 2 0 100 Member Lu, Fang-ming 2 0 100 Other noteworthy matters: 1. If the proposals of the Compensation Committee are not accepted or revised by the Board of Directors, 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 Compensation Committees opinion (if the compensation approved by the Board of Directors is superior to the proposal of the Compensation committee, the difference and causes shall be stated clearly). 2. If members have opposition or qualified opinions to the resolution of the Compensation Committee that have been noted in the record or declared in writing, meeting minutes shall record date and session of the meeting, content of resolution, proposals of all members and the response.
36
(6) Performance of Social Responsibilities

Difference from the Corporate Social Responsibility Best Practice Principles for TWSE/GTSM-Listed Companies and reasons Conformity
Items
Implementation Status
1. Exercise and enhance corporate governance (1) The Company works out its corporate social responsibility policy and checks the results of the implementation. (2) The Company sets up exclusively (or concurrently) dedicated units to be in charge of proposing and enforcing the corporate social responsibility policies. (3) The Company organizes regular education and training on business ethnics and advocating principles for directors, supervisors and employees, and should incorporate the foregoing into its employee performance assessment system to establish a clear and effective reward and punishment system.
1. At present, the Company has worked out its corporate social responsibility policy, covering ethnics, laborers, safety, health, environment and management, and established Foxconn Global SER Committee (FGSC) to drive and supervise the execution of relevant CSR operations. 2. In 2007, The Company set up FGSC organization, which is composed of 7 full-time personnel in charge of driving and supervising relevant work, including the implementation of internal audit, performance assessment, CSR education and training, and the publication of CSR annual report. In addition, there are over 60 part-time personnel in each business group and surrounding units in charge of executing CSR related work. 3. 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 responsibilities and obligations.
2. Environment for sustainable development (1) The Company endeavors to utilize all resources more efficiently and uses renewable materials which have a low impact on the environment. (2) Based on its industrial features, the Company establishes proper environment management systems. (3) The Company establishes dedicated units or assigns dedicated personnel for environment management to maintain the environment. (4) The Company monitors the impact of climate change on its operations, and should establish company strategies to save energy and reduce the emission of carbon and greenhouse gas.
1. The Company actively advocates water recycling, Conformity and adopts some renewable/biodegradable raw materials to effectively reduce the impact of production and manufacturing on the environment. 2. In response to the international trend and customer requirements, the Company gradually established environment management systems for its business units, and passed the certification of ISO 14001. 3. In 2008, environmental protection office was established to be in charge of planning, design, management and operation maintenance of environmental protection facilities, which were installed in all working areas. Moreover, the Company obtained the discharge license issued by the government, and assigned dedicated personnel to be in charge of equipment operation in accordance with laws and regulations. 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.
37
Items
3. Protect social public interests (1) According to the relevant labor laws and internationally acknowledged human rights of laborers, the Company establishes proper management methods, procedures and non-discrimination employment policy to ensure the legal rights and interests of employees. (2) The Company provides safe and healthy working environment for its employees and organizes training on safety and health on a regular basis. (3) The Company establishes regular communication mechanism for employees, and informs employees of the operation changes that may have significant impact on employees in a reasonable way. (4) The Company works out and discloses its policies on consumer rights and interests and establishes transparent and effective procedures for accepting consumer complaints in its products and service. (5) The Company cooperates with its suppliers to jointly foster a stronger sense of corporate social responsibilities. (6) Through commercial activities, noncash property endowments, voluntary service or other free professional services, the company participates in community development and charities events.
Difference from the Corporate Social Responsibility Best Implementation Status Practice Principles for TWSE/GTSM-Listed Companies and reasons 1. The Company abides by the labor law of the region Conformity (or the country) where its working plants are located by transferring relevant contents into its labor management policy. The Company has established corresponding procedures and special lines for labor management to ensure the legal interests and rights of its employees. 2. The Company provides safe and healthy working environment for its employees and focus on employee health care, a health management center to provide employee health and health-related advice and assistance, and regular health and safety at work seminars. 3. The Company regularly holds various communication meetings with employees to convey the Companys policies and information. 4. The Company follows the regulations on limited use/prohibited use of hazardous substance and conflict minerals in an all-round way and provides relevant information to customers. 5. The Company has thousands of suppliers in different regions, but we learn from each other for common progress in the aspects of society and environment like hazardous substance control, environmental protection, labor safety and health, human rights, conflict metal and carbon footprint. At the same time, our suppliers are required to practice their corporate social responsibilities. 6. As the Company actively participates in social activities for public interests and charitable activities, donations are provided for affected people in the Flood 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 (1) The ways for the company to disclose established on the Companys website.
Conformity
38
Items
Implementation Status
Difference from the Corporate Social Responsibility Best Practice Principles for TWSE/GTSM-Listed Companies and reasons
relevant critical and reliable information on corporate social responsibilities. (2) The Company compiles with the report on corporate social responsibilities to disclose the performance of corporate social responsibilities.
2. As a EICC member, the Company is dedicated to promoting social and environmental responsibilities (hereinafter referred to as SER), and worked out Foxconn Global Codes of Conducts: Social and Environmental 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 hasnt 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 $ 825,000 to Law Foundation, NTU. (3) Donated NT$980,000 to Qingling Foundation, NTU for NTU 3D IC packaging and versatile & Flexible organic display device. (4) Contributed NT$300,000 to Hakka Cultural and Economic Exchanges Association Summit Forum. (5) Donated NT $ 200,000 to China Poly Industries Promote Common Standard Foundation. (6) Donated NT $ 5,465,301 to National Tsing Hua University scholarships. (7) Donated NT$9,432,500 to Graduate School Scholarship, National Kaohsiung Applied Sciences University. (8) Contributed NT$500,000 to National Science Museum for Edison Learning Activity Funds. (9) The Company has hosted lots of charity party to support disadvantaged people and social charitable organizations. (10) 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. (11) 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. (12) 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 hasnt 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.
39
(7) Status of Implementation of Integrity Management Implementation of Integrity Operation

Difference from the Integrity Operation Practice Principles for TWSE/GTSM-Listed Companies and reasons Conformity
Items 1. Adopt integrity operation policy and scheme (1) The company clarifies the integrity operation policy in its regulations and external documents and the commitment of board of directors and managers to active implementation. (2) The company works out scheme, operation procedures and guidelines of conducts for employee education and training to prevent dishonest behaviors (3) When working out a scheme to prevent dishonest behaviors, the company adopts measures to prevent bribery and illegal political contributions in business activities with high risks of dishonest behaviors.
Implementation
The Company sticks to the corporate culture with integrity operation as the core and works out codes of conduct (CoC) for stakeholders to perform relevant social and environmental responsibilities, including Letter of Commitment of Manufacturers signed with suppliers, clearly stating that suppliers should ensure transparent and fair commercial trading activities. In addition, the Company has made commitment to customers and shareholders in its CoC. The Company carries out education and training for all employees on CoC every 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
40
Items
Implementation
Difference from the Integrity Operation Practice Principles for TWSE/GTSM-Listed Companies and reasons
3. The company establishes reporting channels and punishments for violation against the regulations of integrity operation as well as the appeal system.
4. Enhance information disclosure (1) The company establishes a website to disclose relevant information on integrity operation. (2) Other information disclosure methods of the company (such as setting up an English website, appointing a dedicated person in charge of collecting and disclosing company information through the website etc.).
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. The Company establishes various Conformity reporting channels so that employees and relevant people can report the improper business behaviors through the system. Anyone who violates the regulations on integrity operation will be punished according to the Companys regulations on reward and punishment. In case of any illegal affairs, legal actions will be taken as well. On the Companys official website both Conformity in Chinese and English (http://www.foxconn.com), there are relevant information on integrity operation such as annual report on corporate social and environmental responsibilities and CoC.
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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 companys dete rmination 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 Companys 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
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(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: 03/25/2013 According to the examination on internal control system done by the Company itself in 2012, we hereby states as follows: (1) The Companys board of directors and management team understand their responsibilities of developing, implementing and maintaining the Companys 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 Companys 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 Companys internal control system (including subsidiary governance) dated December 31, 2012has 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 Companys 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 Taiwans Security and Exchange Act.
43
(7) The Company hereby declares that this statement had been approved by the Board of Directors on 03/25/2013. Among the 6 attending Directors, no one raised any objection to the contents of this statement. Hon Hai Precision Industry Co., Ltd. Chairman: President: Gou, Tai-ming Gou, Tai-ming [signature and seal] [signature and seal]
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(b) The Company is required by the Security and Futures Commission to hire an accountant to audit the Companys 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 2012 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 18, 2012 and its implementation (1) Resolutions: The Company convened the General Meeting of Shareholders on June 18, 2012, and passed (a) 2011 business operation report and 2011 audited financial statements; (b) distribution of 2011 profits; (c) issuance of new common shares for capital increase by retained earnings; (d) Amendment to Procedures for Acquisition or Disposal of Assets; (e) Amendment to Regulations Governing the Election of Directors and Supervisors; (f) Amendment to Shareholders' Meeting Rules; (g) amended the Articles of Incorporation. (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 2, 2012; and the cash dividend was distributed on September 12, 2012. 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 2012 to April 30, 2013 (1) March 27, 2012 The Company obtained 6.584% shareholding rights of Japanese Sharp Corporation (hereinafter referred to as Sharp); recognized the financial statement and consolidated financial statement in 2011; promised to handle the cash capital increase for Chi Mei Optoelectronics Corp. and issue the common shares for cash by capital increase and proposed issuance of Global Depositary Receipts (GDRs); modified the Procedures of the Acquisition or Disposal of Assets, election method of Directors and Supervisors and Articles of Incorporation; convened the general meeting of shareholders in 2012 and formulated the shareholder proposals; In order to raise medium- and long-term funds, the Company issued the domestic unsecured common corporate bonds, indirectly invested the
45
GDS Software (Shenzhen)Co., Ltd., increased funds to Hongyang Precision Industry (Shenzhen) Co., Ltd. and Fujin Precision Industry (Jincheng) Co., Ltd.; indirectly invested Hongfujin Precision Electronics (Yantai) Co., Ltd.. The Companys inv estment in mainland China, Fuyang Electronic Technology (Changshu) Co., Ltd. merged with Fulin Electronic Technology (Changshu) Co., Ltd. The Company indirectly invested Yecheng Photo-electricity (Shenzhen) Co., Ltd., Yecheng Science & Technology (Chengdu) Co., Ltd. and Xincheng Science & Technology (Chengdu) Co., Ltd. In addition, it amended the internal control system, passed the proposal for machines and facilities, and changed the spokesman. (2) April 28, 2012 The Company drafted the distribution of 2011 profit; proposed the issuance of new shares for capital increase by retained earnings; amended the articles of incorporation and meeting norm of the shareholders meeting; approved the internal control statement of 2011; issued new shares for employee restricted stocks and employee stock options below market price; applied the short-term credit line (within 1 year) to financial institution; signed the contract; provided endorsement guarantee to its overseas subsidiary Foxconn (Far East) Ltd. for applying the short-term credit line; provided guarantee to its subsidiary in mainland China, Hongfujin Precision Electronics (Chengdu) Co., Ltd. for borrowing joint loan; guarantee to its subsidiary, Foxconn (Far East) Ltd. for issuing Japanese Yen bonds; guarantee to its overseas subsidiary, Best Leap Enterprises Ltd. for borrowing joint loan; guarantee to subsidiary Competition Team Technologies Ltd. for issuing dollar bonds. In addition, it indirectly invested Futaihua Precision Electronics (Jiyuan) Co., Ltd. and Futaijing Precision Electronics (Yantai) Co., Ltd., increased funds for Hongqisheng Precision Electronics (Qinhuangdao) Co., Ltd. and Fuding Electronic Science & Technology (Jiashan) Co., Ltd. (3) July 13, 2012 Set capital increase by retained earnings and proposed IPO allotment, ex-dividend reference date for 2011 Fiscal Year. Set cash dividend payment date and ex-dividend date for 2012 Fiscal Year; provided endorsement guarantee to its overseas subsidiary, Competition Team Technology Limited (hereinafter referred to as CTT) for applying loan from bank; guarantee to its overseas subsidiary, Competition Team Ireland Limited (hereinafter referred to as CTIL) for applying the short-term turnover amount from bank; guarantee to its overseas subsidiary, Hongfujin Precision Electronics (Chengdu) Co., Ltd. for applying medium and long term loan from bank; figured out the overall financial plan for the group; established the issuing platform of Medium Term Note (hereinafter referred to as MTN); issued the bonds priced in foreign currencies with Foxconn (Far East) Limited (Cayman) and/or Competition Team Technologies Limited (Bahamas) as issuer and the Company itself guarantor; provided guarantee to its subsidiary, Foxconn (Far East) Limited (Cayman) (hereinafter referred to as issuer) for issuing dollar (or equivalent foreign currencies) bonds under MTN program. In addition, it applied the credit line to financial institutions for the needs of operation turnover, risk management of interest and exchange rate; signed the contract to indirectly increase funds to Fuxiang Precision Industry (Kunshan) Co., Ltd., Fuyu Electronic Science & Technology (Huaian) Co., Ltd., Foxconn Electronic Industry Development (Kunshan) Co., Ltd. invested and established Funeng New Energy Science & Technology Service (Nanyang) Co., Ltd., Zhongzhun Precision Industry (Luoyang) Co., Ltd. It also obtained the equity of Innocom
46
Technology (Chongqing) Co., Ltd.; ratify the machines and facilities disposal case; ratify the granted case of the year-end bonus and performance bonus to managers in 2011; worked out methods to evaluate performance and calculate rewards for directors, supervisors and managers. (4) August 31, 2012 The Company recognized the financial statement and consolidated financial statement of the first half year of 2012; Ratify the equipment obtain cases of the Company. (5) October 30, 2012 The Company issued domestic unsecured common corporate bonds to raise medium- and long-term funds; issued short-term non-guarantee commercial paper to meet the needs of operation turnover; applied the credit line to financial institutions for the needs of operation turnover, risk management of interest and exchange rate. The Company signed the credit contract in which the highest capital limit doesnt exceed ten billion Japanese Yen. The Company also increased funds for Sanchuang Digital Co., Ltd., indirectly invested and established Hongfujin Precision Electronics (Hengyang) Co., Ltd., Hongfuyuan (Shenzhen) Environmental Technology Co., Ltd., Oudiyuan (Shenzhen) Environmental Technology Co., Ltd, Futaihua Precision Electronics (Chengdu) Co., Ltd., Jiaxing Ruixia Commerce Co., Ltd., Futaihua Precision Electronics (Jiyuan) Co., Ltd., Xincheng Technology (Chengdu) Co., Ltd., Xincheng Photo-electricity (Shenzhen) Co., Ltd.; Ratify the machinery equipment obtain cases of the Company; The Company has formulated the annual audit plan for 2013. (6) March 25, 2013 Ratify 2012 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, propose to issue new shares for employee Restricted Stock Awards, Loan Procedures, Procedures for Endorsements & Guarantees, and Articles of Incorporation amendment cases, election of Directors and Supervisors, to approve the lifting of director of non-competition restrictions, to set date and subjects for 2013 general shareholders meeting of the Company, to approve Director and Supervisor candidate list , Regulations Governing the Election of Directors and Supervisors amendment, in response to Act amended, to change the terms of the Companys participation in the issue of GDR Depositary Agreement in 1999 which concerning how to vote in the Companys shareholders meeting for the GDR holders, to endorse overseas subsidiaries, Competition Team Ireland Limited, for applying short-term bank liquidity, obtain FuNuin New Energy Technology Services (Nanyang) Co., Ltd. equity case, propose to dispose of the Companys subsidiaries reinvested MediaMarket (China) International Retail Holding Limited Case, to approve 2012 Annual Statement of Internal Control of the Company, ratify obtained equipment case, the annual bonus appropriation case to employees and managers.
(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
47
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 Companys chairman, general manager, accounting director, financial director, internal auditors, R&D supervisor had been: None
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C. Information on Accountants Fees

(1) Range of accountants fee
CPA Firm PricewaterhouseCoopers Taiwan Name of accountant Hsu, Yong-jian Xue, Ming-ling Inspection period 2012 Remarks -
Unit: NT$Thousand
Fee items Audit fee Range of amount 1 Under 2 million 2 2 million(included) ~ 4 million 3 4 million(included) ~ 6 million 4 6 million(included) ~8 million 5 8 million(included) ~ 10 million 6 Over 10 million (included) Non-audit fee Total
(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
D. Alternation of CPA
(1) About the Former CPA: (2) About the Successor CPA: (3) Reply of the Previous Accountant: None None N/A
E. The Companys 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
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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
Title Chairman Director Director Director Director Independent Director Independent Director Supervisor Supervisor Department General Manager Department General Manager Department General Manager Department General Manager Department General Manager Department General Manager Name Terry Gou Representative of Jeng-wu Representative of Sung-ching Representative of Fang-ming Representative of Chien, Yi-bin Wu, Yu-Chi Liu, Cheng-Yu Representative of Furui International Investment Co., Ltd.: Wan, Juihsia Huang, Qing-Yuan Lu, Sung-ching Tai, Jeng-wu You, Xiang-fu Lu, Fang-ming Jiang, Hao-liang Chien, Yi-bin Hongqiao International Investment Co., Ltd.: Tai, Hongqiao International Investment Co., Ltd.: Lu, Hongjing International Investment Co., Ltd.: Lu, Hongjing International Investment Co., Ltd.: 2012 Current year to 04/30 Shareholding Pledged Shares Shareholding Pledged Shares Increase/Decrease Increase/Decrease Increase/Decrease Increase/Decrease 133,999,048 1,696,172 1,696,172 118,437 118,437 0 0 5,139,672 0 (785,738) 3,079,359 831,207 867,941 195,606 (111,244) 370,000,000 0 0 0 0 0 0 600,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (1,060,000) (3,020,000) 0 0 0 79,000 10,000,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0
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Title Department General Manager Department General Manager Department General Manager Department General Manager Head Office General Manager Financial Director Accounting Director
Name Xu, Mu-ji Zhong, Yi-wen Ling, Zhi-ping Xiong, Bing-zheng Li, Jin-ming Huang, De-cai Chou, Zong-kai
2012 Current year to 04/30 Shareholding Pledged Shares Shareholding Pledged Shares Increase/Decrease Increase/Decrease Increase/Decrease Increase/Decrease (632,748) (273,383) (58,540) 307,260 (196,330) 331,346 61,750 0 0 0 0 0 0 0 (450,000) 95,750 (9,000) 0 (150,000) 0 0 0 0 0 0 0 0 0
(2) Information on equity transfer: (3) Information on equity pledge:
The counterparties of equity transfer are not related parties. The counterparties of share pledges are not related parties.
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G. Information on relation among top ten shareholders

Date: 04/28/2013
Shareholding Name Number Terry Gou Citibank Hosting Hon Hai Precision Industry Co., Ltd. Depositary Receipts Account Chase Bank Hosting Central Bank of Saudi Arabia Investment Account Standard Chartered Bank hosting Sanskrit Vanguard Emerging Markets Equity Index Fund account Citibank Hosting Government of Singapore Investment Account JP Morgan Chase Bank hosting Abu Dhabi Investment Authority Investment Account Standard Chartered Bank Hosting the Fidelity Puritan Trust: Fidelity low-priced stocks Fund Standard Chartered Bank hosting iShares MSCI Emerging Markets Index Fund Investment Account Cathay Life Insurance Co., Ltd. JP Morgan Hosting ABP pension fund account 1,473,989,536 303,140,549 230,646,627 210,784,314 172,755,725 140,926,047 127,600,000 119,635,231 112,369,247 111,109,232 % 12.45 2.56 1.95 1.78 1.46 1.19 1.08 1.01 0.95 0.94 Spouse & Minor Minor Shareholding Number % Shares Held through Other Parties Shares held Number % Related Party (Note) Remark Name None None None None None None None None None None Relation None None None None None None None None None None -
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 2nd degree of kinship.
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H. Combined shareholding percentage

04/28/2013; unit: 1,000 shares
Shift in investment Foxconn (Far East) Ltd. Hongyang Venture Capital (Shenzhen) Co., Ltd. Foxconn Holding Ltd. Baoxin International Investment Co., Ltd. Hongqi International Investment Co., Ltd. Hongyuan International Investment Co., Ltd. Ambit International Ltd. Liyi International Investment Co., Ltd. Pan-International Industrial Corp. Foxconn Technology Co., Ltd. Yangxin Technologies Co., Ltd. PREMIER IMAGE TECHNOLOGY (HK) LTD. Sanchuang Digital Co., Ltd. Foxconn Holdings B.V.-Netherland Foxconn Singapore Pte. Margini Holdings Ltd. Foxconn SA B. V. Investment by the Company Shares 3,578,845 405,503 99,100 621,000 250,000 267,000 53,100 96,900 106,178 124,238 7,873 1,409 115,570 107,723 53,038 275,890 72,163 % 100.00% 97.50% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 20.84% 10.04% 64.58% 1.63% 80.00% 100.00% 100.00% 100.00% 97.76% Investment by directors, supervisors, managers, direct or indirect control groups Shares % 10,397 29,181 246,470 4,317 84,749 2.50% 5.73% 19.92% 35.42% 98.33% Combined investment Shares 3,578,845 415,900 99,100 621,000 250,000 267,000 53,100 96,900 135,359 370,708 12,190 86,158 115,570 107,723 53,038 275,890 72,163 % 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 26.57% 29.97% 100.00% 99.96% 80.00% 100.00% 100.00% 100.00% 97.76%
Note: Long-term equity investment of the Company calculated according to the equity method.
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IV.
Company Shares and Fund Raising
A. Company capital and shares

(1) Capital and Shares 04/28/2013; Unit: 1,000 shares
Authorized Capital Type Issued shares Outstanding Shares Registered Common Shares (Listed Stock) 11,835,867 Total 11,835,867 Non-issued Shares Options, bonds, warrants, other convertible shares 500,000 Total
2,664,133
15,000,000
(2) Sources of Capital Unit: NT$1,000; 1,000 shares

Authorized capital stock Issue price (NT$) Paid-in capital Remarks Property other than cash offset by the number of shares
Year/ month
Shares
Amount
Shares
Amount
Source of capital (NT$1,000)
Approval date and document No.
1991/06
10 42
100,000
1,000,000
80,300
803,000
1992/07
10
100,000
1,000,000
97,600
976,000
1993/08
10
150,000
1,500,000
112,800
1,128,000
1994/08
10
150,000
1,500,000
130,300
1,303,000
1995/06
10
250,000
2,500,000
187,900
1,879,000
Capital increase NT$93,000 by earnings Capital increase NT$90,000 by cash Capital increase NT$132,850 by earnings Capital increase NT$40,150 by capital reserve Capital increase NT$103,200 by earnings Capital increase NT$48,800 by capital reserve Capital increase NT$118,600 by earnings Capital increase NT$56,400 by capital reserve Capital increase NT$445,700 by earnings Capital increase NT$130,300 by capital reserve
None
None
None
None
None
June 19, 1995 (84), TCZ(I) No. 36224
54
Authorized capital stock Issue price (NT$)
Paid-in capital
Remarks Property other than cash offset by the number of shares None
Year/ month
Shares
Amount
Shares
Amount
1995/10
48
250,000
2,500,000
227,900
2,279,000
Capital increase NT$400,000 by cash
October 09, 1995 (84), TCZ(I) No. 52879 July 9, 1996 (85), TCZ(I) No. 41678
1996/10
10
450,000
1997/09
10
600,000
1998/08
10
1,000,00 0
1999/08
10
1,300,00 0
Capital increase 3,580,000 NT$1,301,000 by earnings Capital increase NT$1,108,400 by earnings 6,000,000 511,800 5,118,000 Capital increase NT$429,600 by capital reserve Capital increase NT$1,818,560 by earnings 10,000,000 734,600 7,346,000 Capital increase NT$409,440 by capital reserve Capital increase 13,000,000 1,050,000 10,500,000 NT$3,154,000 by earnings 4,500,000 358,000 13,000,000 1,100,000 11,000,000 Capital increase NT$500,000 by cash
None
None
June 30, 1997 (86), TCZ(I) No. 51749
None
July 10, 1998 (87), TCZ (I) No. 58651 June 30, 1999 (88),TCZ(I) No. 58593 August 9, 1999 (88),TCZ(I) No. 63098 June 22, 2000 (89),TCZ(I) No. 54010 June 13, 2001 (90), TCZ(I) No. 137713 June 27, 2002 (91), TCZ(I) No. 135225 June 12, 2003 (92), TCZ(I) No. 920128415 January 27, 2004 (93), TCZ(I) No. 920162759 July 21, 2004, JGZYZ No.0930132689 -
None
1999/11
220.7 1,300,00 5 0 10 2,400,00 0 2,400,00 0 3,000,00 0 3,000,00 0 3,600,00 0
None
2000/08
2001/08
10
2002/08
10
2003/08
10
2004/07
10
2004/10
10
4,600,00 0 4,600,00 0 5,300,00 0
2005/05 2005/08
10 10
Capital increase 24,000,000 1,452,900 14,529,000 NT$3,529,000 by earnings Capital increase 24,000,000 1,768,780 17,687,800 NT$3,158,800 by earnings Capital increase 30,000,000 2,064,897 20,648,970 NT$2,961,170 by earnings Capital increase 30,000,000 2,519,174 25,191,744 NT$4,542,774 by earnings Capital increase 36,000,000 2,757,198 27,571,989 NT$2,380,244 by merging Capital increase NT$4,738,011 by 46,000,000 3,231,023 32,310,231 earnings; Converse NT$231 Euro-convertible bond Converse NT$76,957 46,000,000 3,238,718 32,387,189 Euro-convertible bond Converse NT$458,061 53,000,000 3,284,525 32,845,251 Euro-convertible bond
None
None
None
None
None
None
None None
55
Authorized capital stock Issue price (NT$)
Paid-in capital
Remarks Property other than cash offset by the number of shares None None None None
Year/ month
Shares
Amount
Shares
Amount
2005/09 2005/11 2006/04 2006/09
10 10 10 10
5,300,00 0 5,300,00 0 5,300,00 0 5,700,00 0 5,700,00 0 7,000,00 0 8,120,00 0 9,300,00 0 10,820,0 00 12,230,0 00 12,230,0 00
2007/03
10
2007/09
10
2008/10
10
2009/06
10
2010/09
10
2011/08
10
2012/09
10
Capital increase 53,000,000 4,003,171 40,031,717 NT$7,186,466 by earnings Converse NT$351,514 53,000,000 4,038,323 40,383,231 Euro-convertible bond Converse NT$616,303 53,000,000 4,099,953 40,999,534 Euro-convertible bond Capital increase 57,000,000 4,989,944 49,899,441 NT$8,899,907 by earnings Capital increase 57,000,000 5,168,139 51,681,388 NT$1,781,947 by merging Capital increase 70,000,000 6,290,767 62,907,665 NT$11,226,277 by earnings Capital increase 81,200,000 7,414,623 74,146,235 NT$11,238,569 by earnings Capital increase 93,000,000 8,578,932 85,789,319 NT$11,643,084 by earnings Capital increase 108,200,000 9,661,248 96,612,482 NT$10,823,163 by earnings Capital increase 10,689,09 106,890,96 122,300,000 NT$10,278,485 by 7 7 earnings Capital increase 11,835,86 118,358,66 122,230,000 NT$11,467,698 by 7 5 earnings
January 29, 2005, JGZYZ No.0940131076 July 11, 2006, JGZYZ No.0950129699 October 19, 2006, JGZYZ No.0950147071 July 09, 2007, JGZYZ No.0960035148 June 30, 2008, JGZYZ No.0970032402 April 28, 2009, JGZYZ No.0980017596 July 01, 2010, JGZFZ No.0990034120 June 20, 2011, JGZFZ No.1000028108 July 5, 2012 JGZFZ No. 1010029788
None
None
None
None
None
None
None
(3) Information on shelf registration system: None
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(4) Shareholder Structure 04/28/2013

Shareholder Structure Governments Financial institutions Quantity Members Total shares held Shareholdings (%) 9 245,020,005 2.07% 277 714,043,094 6.03% Juridical Person 888 Private Investors 573,796 Foreign institutions & foreigners 2,530
Total
577,500
398,340,403 5,153,092,366 5,325,370,659 11,835,866,527 3.37% 43.54% 44.99% 100.00%
(5) Distribution of Shares (a) Distribution of common shares 04/28/2013

Shares 1-999 1,000 to 5,000 5,001 to 10,000 10,001 to 15,000 15,001 to 20,000 20,001 to 30,000 30,001 to 40,000 40,001 to 50,000 50,001 to 100,000 100,001 to 200,000 200,001 to 400,000 400,001 to 600,000 600,001 to 800,000 800,001 to 1,000,000 Above 1,000,001 Total Members 94,208 344,033 73,616 25,682 12,309 10,981 4,910 2,857 4,742 1,887 904 319 170 120 762 577,500 Total Shares held 26,943,004 762,519,579 532,730,500 314,885,709 217,947,960 269,615,468 171,281,386 129,444,314 328,760,162 261,561,587 255,017,772 158,021,660 118,570,740 107,694,057 8,180,872,629 11,835,866,527 Shareholdings (%) 0.23% 6.44% 4.50% 2.66% 1.84% 2.28% 1.45% 1.09% 2.78% 2.21% 2.16% 1.34% 1.00% 0.91% 69.11% 100.00%
(b) Diversification of preferred stocks: The Company doesnt issue preferred stocks.
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(6) List of major shareholders 04/28/2013

Shares Major Shareholders name Terry Gou Citibank Hosting Hon Hai Precision Industry Co., Ltd. Depositary Receipts Account Chase Bank Hosting Central Bank of Saudi Arabia Investment Account Standard Chartered Bank hosting Sanskrit Vanguard Emerging Markets Equity Index Fund account Citibank Hosting Government of Singapore Investment Account JP Morgan Chase Bank hosting Abu Dhabi Investment Authority Investment Account Standard Chartered Bank Hosting the Fidelity Puritan Trust: Fidelity low-priced stocks Fund Standard Chartered Bank hosting iShares MSCI Emerging Markets Index Fund Investment Account Cathay Life Insurance Co., Ltd. JP Morgan Hosting ABP pension fund account Shares held 1,473,989,536 303,140,549 230,646,627 210,784,314 172,755,725 140,926,047 127,600,000 119,635,231 112,369,247 111,109,232 Shareholdings (%) 12.45% 2.56% 1.95% 1.78% 1.46% 1.19% 1.08% 1.01% 0.95% 0.94%
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(7) Information on Market Price, Equity, Earnings, Dividends Per Share & Relatives
Year Item Before adjustment After adjustment Before adjustment After adjustment Current year to March 31, 2013
2011
2012
Highest Market Price Per Share Lowest (Note 1) Average Equity Per Share Earnings per share (Note 2)
126.50 115.00 61.50 61.50 92.89 54.06
117.00 105.00 79.00 70.45 92.08 54.62 11,798,513 8.03 1.5 1.0 -
89.90
79.70 83.62 57.33 11,834,564 1.38 -
Before distribution After distribution Weighted average shares (1,000 shares) Before Earnings per adjustment share (NT$) After adjustment Cash dividend Stock Dividends Appropriated from Retained Earnings Stock Dividends Stock Dividends Appropriated from Capital Reserve Accumulated Unappropriated Dividends P/E ratio Price-dividend ratio Cash dividend yield
10,661,194 7.65 6.94 1.5 1.0
Dividends per share (Note 3)
None
None
None 12.14 61.93 1.61%
None 11.47 61.39 1.63%
Investment return analyses
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: 2012 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 Companys 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.
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(b) Distribution of stock dividends at this Shareholders Meeting: (i) Shareholder stock dividend: Since 2012, the Company allotted NT $ 11,835,866,530 to issue new shares through capitalization, with 100 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 2012, the Company allotted NT$17,753,799,791 as cash dividend, with NT$1.5 for each share. After gaining the approval of the General Meeting of Shareholder, the Board of Directors shall formulate the base day for distribution. (9) Influence of non-compensated distribution of shares and the present occasion on the Companys business performance, earnings per share, and shareholder rights
Year Item Amount of paid-in capital in opening period (NT$) Cash dividend per share (NT$) Dividend Distribution (Note 1) Stock dividends per share for capital increase by retained earnings (Shares) 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 Variation Change in after-tax net profit compared with the previous year 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 converted to cash dividends Pro forma EPS Pro forma average ROI Pro forma EPS Pro forma average ROI N/A (Note 2) N/A (Note 2) 2013 (estimate) 118,358,665,270 1.5 0.1 -
Pro forma earnings If no capital increase by capital reserve N/A (Note 2) per share and 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) Pro forma average ROI dividends Note 1: Pending resolution by 2012 Annual General Shareholders Meeting. Note 2: Hon Hai is not required to disclose its 2013 financial forecast pursuant to Regulations Governing the Publication of Financial Forecasts of Public Companies.
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(10)
Employee dividends and remuneration of directors and supervisors:
(a) Information on employee dividends and director/supervisor remuneration, as set forth in the Companys articles of incorporation: The Companys 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 Companys 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.
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(2) The employee stock dividend shall be NT$6,822,891,111, 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$7.97. (4) In the case of any differences between the actual distributed and recognized number, please state the difference, reasons and response: The Companys actually distributed number is of no difference with the recognized one. (d) Actual distribution of employee dividends, directors/supervisors in the previous year: (1) Actual distribution Unit: NT$
Employee dividends Employee Stock Dividends: Amount 5,874,551,962 Employee Stock Dividends: Number of Shares 77,860,198 Employee Cash Dividends 22 Remuneration to Directors and Supervisors 0
remuneration
of
Note: NT$75.45 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 Companys actually distributed number does not differ from the recognized one. (11) Share repurchases: None
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B. Section on Corporate Bonds

(1) Corporate Bonds Unit: NT$
2005 Unsecured Corporate Bonds, Phase I Bonds A-E Issuing (handling) date Denomination Issuing and transaction location Issue price Total amount Interest rate Deadline September 22, 2005 September 28, 2005 1,000,000 Market (listed) October 6, 2009 1,000,000 Market (listed) December 27, 2010 1,000,000 Market (listed) March 8, 2011 1,000,000 Market (listed) 2009 Unsecured Corporate Bonds, Phase I 2010 Unsecured Corporate Bonds, Phase I 2011 Unsecured Corporate Bonds, Phase I
Corporate Bond Type
Issue by denomination Issue by denomination Issue by denomination Issue by denomination 2,500,000,000 2.37% 10-year period Due date: September 22, 2015 - September 28, 2015 None Bank SinoPac Company Limited None None None Repayment in lump sum upon maturity 5,500,000,000 None None Rating agency: China Credit Rating Co., Ltd. Rating date: August 23, 2005 Rating result: twAA 6,820,000,000 1.72% 5-year period Due date: October 6, 2014 None Bank SinoPac Company Limited None None None 6,000,000,000 1.43% 5-year period Due date: December 27, 2015 None Bank SinoPac Company Limited None None None 6,000,000,000 1.47% 5-year period Due date: March 8, 2016 None Bank SinoPac Company Limited None None None
Guarantee Agency Consignee Underwriting institution Certified lawyer CPA
Repayment method
Respectively repay Respectively repay Respectively repay 50% in the fourth and 50% in the fourth and 50% in the fourth and fifth years from the fifth years from the fifth years from the expiration of issue expiration of issue date expiration of issue date date 6,820,000,000 None None Rating agency: China Credit Rating Co., Ltd. Rating date: December 26, 2008 Rating result: twAA+ 6,000,000,000 None None Rating agency: China Credit Rating Co., Ltd. Rating date: December 3, 2010 Rating result: twAA+ 6,000,000,000 None None Rating agency: China Credit Rating Co., Ltd. Rating date: December 21, 2010 Rating result: twAA+
Outstanding principal Terms of redemption or advance repayment Restrictive clause Name of credit rating agency Rating date Rating of corporate bonds
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As of the printing date of this Annual Report, amount of (exchanged or subscribed) Other ordinary s h are s, rights GDRs or other attached securities converted: Issuance and conversion (exchange or subscription) method Issuance and conversion, exchange or subscription method, issuing condition dilution, and impact on existing shareholders equity Transfer Agent
N/A
N/A
N/A
N/A
None
None
None
None
None
None
None
None
None
None
None
None
Unit: NT$
Corporate Bond Type Issuing (handling) date Denomination Issuing and transaction location Issue price Total amount Interest rate Deadline Guarantee Agency Consignee Underwriting institution Certified lawyer CPA Repayment method Outstanding principal Terms about redemption or advance repayment 2011 Unsecured Corporate Bonds, Phase II Bond A June 14, 2011 1,000,000 Market (listed) Issue by denomination 3,000,000,000 1.43% 5-year period Due date: June 14, 2016 None Bank SinoPac Company Limited None None None Repayment in lump sum upon maturity 3,300,000,000 None 2,650,000,000 1,400,000,000 2,650,000,000 1.66% 7-year period Due date: June 14, 2018 1,400,000,000 1.82% 10-year period Due date: June 14, 2021 Bond B June 14, 2011 1,000,000 Bond C June 14, 2011 1,000,000 2011 Unsecured Corporate Bonds, Phase III July 18, 2011 1,000,000 Market (listed) Issue by denomination 4,950,000,000 1.51% 5-year period Due date: July 18, 2016 None Bank SinoPac Company Limited None None None Repayment in lump sum upon maturity 4,950,000,000 None 2012 Unsecured Corporate Bonds, Phase I March 1, 2012 1,000,000 Market (listed) Issue by denomination 9,000,000,000 1.34% 5-year period Due date: March 1, 2017 None Bank SinoPac Company Limited None None None Repayment in lump sum upon maturity 9,000,000,000 None
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Restrictive clause Name of credit rating agency: Rating date: Rating of corporate bonds:
None Rating agency: China Credit Rating Co., Ltd. Rating date: May 19, 2011 Rating result: twAA+
None Rating agency: China Credit Rating Co., Ltd. Rating date: June 23, 2011 Rating result: twAA+
None Rating agency: China Credit Rating Co., Ltd. Rating date: December 16, 2011 Rating result: twAA+
As of the printing date of this Annual Report, amount of (exchanged or subscribed) NA Other ordinary rights s har es, GDRs attached or other securities converted: Issuance and conversion (exchange or subscription) method
NA
NA
None
None
None
Issuance and conversion, exchange or subscription method, issuing condition None dilution, and impact on existing shareholders equity Transfer Agent None
None
None
None
None
Unit: NT$
Corporate Bond Type 2012 Unsecured Corporate Bonds, Phase II May 23, 2012 1,000,000 Market (listed) 2012 Unsecured Corporate Bonds, Phase III August 6, 2012 1,000,000 Market (listed) 2012 Unsecured Corporate Bonds, Phase IV October 11, 2012 1,000,000 Market (listed) 2013 Unsecured Corporate Bonds, Phase I Note A 102.1.30 1,000,000 Market (listed) Note B 102.1.30 1,000,000
Issuing (handling) date Denomination Issuing and transaction location Issue price Total amount Interest rate Deadline Guarantee Agency Consignee
Issue by denomination Issue by denomination Issue by denomination Issue by denomination 6,000,000,000 1.43% 8,000,000,000 1.18% 3,300,000,000 1.35%
7,450,000,000 3,600,000,000
1.33% 1.45% 5-year 7-year period 5-year period 3-year period 5-year period period 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 None None None None Bank SinoPac Company Limited Bank SinoPac Company Limited Bank SinoPac Company Limited Bank SinoPac Company Limited
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Underwriting institution Certified lawyer CPA Repayment method Outstanding principal Terms about redemption or advance repayment Restrictive clause Name of credit rating agency: Rating date: Rating of corporate bonds: As of the printing date of this Annual Report, amount of (exchanged or subscribed) ordinary Other s har es, GDRs rights or other attached securities converted: Issuance and conversion (exchange or subscription) method Issuance and conversion, exchange or subscription method, issuing condition dilution, and impact on existing shareholders equity Transfer Agent
None None None Repayment in lump sum upon maturity 6,000,000,000 None None Rating agency: China Credit Rating Co., Ltd. Rating date: April 24, 2012 Rating result: twAA+
None None None Repayment in lump sum upon maturity 8,000,000,000 None None Rating agency: China Credit Rating Co., Ltd. Rating date: July 11, 2012 Rating result: twAA+
None None None Repayment in lump sum upon maturity 3,300,000,000 None None Rating agency: China Credit Rating Co., Ltd. Rating date: September 12, 2012 Rating result: twAA+
None None None Repayment in lump sum upon maturity

7,450,000,000 3,600,000,000
None None Rating agency: China Credit Rating Co., Ltd. Rating date: September 12, 2012 Rating result: twAA+
N/A
N/A
N/A
N/A
None
None
None
None
None
None
None None
None
None
None
None
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(2) Convertible Bonds

Corporate Bond Type Year Item Market Highest price of converti Lowest ble bonds Average Conversion price Issuing (handling) date Issued on October 12, 2010 and conversion price in NT$152.75 issuing Method of performing Issuance of new shares conversion obligations First-time unsecured Euro-convertible bonds 2012 106.279 96.104 101.127 111.592 From the current year to 04/30/2013 103.693 99.857 101.072
(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, 2013, 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. In addition, by the end of April 30, 2013, the ECB issued 26,296,111 units of GDRs in total.)
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04/28/2013
Issue date: Item October 7, 1999 March 17, 2005 Issuing location: Europe, Asia, USA Transaction location: London Stock Exchange USD 257,178,618.20 USD 8.7577 29,366,000 units
Issuing location: Europe, Asia, USA Issuing and transaction location: Transaction location: London Stock Exchange Total amount: Unit issue price: Total of issued unit USD 416,700,000 USD 13.89 (1) 25,000,000 units (2) 5,000,000 units 30,000,000 units in total (1) Issuance of new shares for cash increase (2) The Companys common shares held by the original shareholders
Source of negotiable securities
The Companys common shares held by the original shareholders 58,732,000 common shares
Amount of negotiable securities 60,000,000 common shares GDR holders rights and obligations Consignee Depository Bank Custodian Bank Outstanding balance
1. Right to vote 1. Right to vote 2. Right to distribute dividend, 2. Right to distribute dividend, subscribe new shares and other rights subscribe new shares and other rights None Citibank N. A Citibank N. A, Taipei Branch None Citibank N. A Citibank N. A, Taipei Branch
150,335,079 Unit (negotiable securities 300,670,163 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 depositary and escrow agreement Market price per unit (unit: USD) Highest 2012 Lowest Average Highest Current year Lowest to 04/30/2013 Average The depositary institute performs the obligations for GDR holders, while the guarantee agency keeps GDR common shares. 7.82 5.2 6.51 6.145 4.998 5.572
E. Subscription of warrants for employees:

None
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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 doesnt issue any uncompleted plan or completed one with unrealized benefit within the latest three years.
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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
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(a) Current product items The Companys 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 R&D Expenses R&D Expenses to Revenue %
2012 11,478,794 0.36%
Jan-Mar., 2013 2,300,147 0.35%
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B. Production and Sales Status

(1) Key Accounts in the Past Two Years (a) Key Suppliers
Unit: NT$million 2011 Item 1 2 From Vendor ac Amount 904,830 Percentage of Relationship total Net with the From Purchases issuer (%) 35.08% Note 1 Vendor ac Vendor af Vendor ag 2012 Amount 760,977 445,389 400,306 Percentage Relationship of total Net with the From Purchases issuer (%) Vendor ac 26% Note 1 Vendor af 15% Note 1 14% 45% 100% Note 1 Others Total Net Purchases 214,277 477,139 65% 100% As of end of Q1, 2013 Amount 134,111 128,751 Percentage of total Net Purchases (%) 18% 17% Relationship with the issuer Note 1 Note 1
Others 1,674,814 64.92% Other 1,331,113 Total Net Total Net 2,579,644 100.00% 2,937,785 Purchases Purchases Note 1: Indirect investment subsidiary of the Company. Note 2: Changes were due to market trend dynamics and customer demand variation.
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(b) Key Buyers

Unit: NT$million 2011 Item 1 From Amount Percentage of Relationship total Net with the Sales (%) issuer From 2012 Amount Percentage Relationship of total Net with the Sales (%) issuer From As of end of Q1, 2013 Amount Percentage of total Net Sales (%) 60.55% 10.16% 29.29% 100.00% Relationship with the issuer Nil Nil -
Customer 1,350,164 48.68% Nil Customer E 1,840,779 57.19% Nil Customer E 387,543 E Customer 2 343,170 12.37% Nil Customer A 329,113 10.22% Nil Customer A 65,037 A Others 1,079,977 38.95% Others 1,049,036 32.59% Others 205,735 Total Net Total Net Total Net 2,773,311 100.00% 3,218,928 100.00% 658,315 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 & Value Major Product 3C Electronics
2011 Capacity Quantity Value
2012 Capacity Quantity Value 3,090,181,680
18,531,684 16,350,881
2,677,526,630 24,871,337 21,943,981
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(3) Sales Value in the Most Recent Years

Unit: 1,000 pcs, NT$Thousand
Quantity & Value Major Product 3C Electronics Service and Management Fee Incomes
2011 Domestic Quantity 78,851 Value 13,452,920 Export Quantity 16,176,352 Value 2,755,589,938 4,268,520 Domestic Quantity 156,408 Value
2012 Export Quantity 19,688,931 Value 3,187,695,80 9 5,863,062
25,369,524
(4) Taiwan Employee Data during the Past Two Years and Up to Apr. 30, 2013
Year Staff Employee Number Operator Total Average Age Average Seniority PhD Degree Master Degree Education College Distribution % High School Below High School 2011 6,651 18 6,669 38.20 5.90 2.07% 44.08% 50.74% 2.76% 0.34% 2012 6,568 35 6,603 38.53 6.34 2.01% 45.49% 49.37% 2.73% 0.39% Up to Apr. 30, 2013 6,487 34 6,521 38.53 6.57 2.07% 45.67% 49.15% 2.70% 0.41%
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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 Companys 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 environmentfriendly 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 Companys 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
2014 Expense or equipment to be purchased for pollution control Predicted improvement Amount paid None None None 2015 None None None
(2) Influence after improvement

Influence on net profit Influence on competitive position None None 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 Companys 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 Companys 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, stabilit y, development, science and technology, internationality. The Company formulated the Method on Employee Trainings. Based on this, the Company provided 573,818 hours of trainings in 2012 with the training fees reaching up to NT$33,358,842. 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 processoriented, 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 departments: 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 Companys benefit within the legal scope. Every employee has the responsibility to prevent the Companys interests from being lost or impaired and is obliged to maintain the Companys 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 2012. (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 2012. (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 Companys website and relevant bulletin boards. (f) Education trainings: The Company provided safety and health trainings to 936 new employees, 1605 regular staff and 93 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
Concise Balance Sheet

Unit: NT$Thousand Period Item Current assets Net property, plant and equipment Intangible assets Other assets Total assets Before Distribution Current liabilities After Distribution Non-current liabilities Before Distribution Total liability After Distribution Equity attributable to owners of parent Share capital Capital surplus Before Distribution Retained earnings After Distribution Other equity interest Treasury shares Non-controlling interests Before Distribution Total equity After Distribution Note 2
Note 1: If asset revaluated in that period, the value date and new value amount should be presented. Note 2: As of April 30, 2013, the amount of after distribution has not presented due to the proposal of earnings distribution of year 2012 had not yet been submitted to the shareholders' meeting.
As of March 31, 2013
1,506,392,829 408,053,543 3,955,963 106,931,445 2,025,333,780 1,189,622,293 Note 2 119,674,734 1,309,297,027 Note 2 678,517,673 118,358,665 58,889,659 476,124,374 Note 2 25,163,876 (18,901) 37,519,080 716,036,75
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Concise Statement of Comprehensive Income

Unit: NT$Thousand Period Item Operating revenue Gross profit (loss) from operations Net operating income (loss) Non-operating income and expenses Profit (loss) from continuing operations before tax Profit (loss) from continuing operations Loss from discontinuing operations Net Profit (loss) Other comprehensive income, net Total comprehensive income Profit (loss), attributable to owners of parent Profit (loss), attributable to non-controlling interests Comprehensive income, attributable to owners of parent Comprehensive income, attributable to noncontrolling interests Basic earnings per share
As of March 31, 2013
809,011,951 45,913,087 13,906,991 8,690,182 22,597,173 16,350,324 16,350,324 17,466,671 33,816,995 16,352,513 (2,189) 33,710,832 106,163 1.38
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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
Period Most Recent 5-Year Financial Information Item 2008 2009 2010 2011 2012
Current assets 318,224,251 439,496,040 722,996,649 958,370,691 1,083,776,739 Fund and Longterm equity 290,037,817 361,366,109 428,619,217 534,685,388 603,762,719 investments Fixed assets (Note 38,966,815 31,592,786 28,828,180 33,886,138 26,828,097 1) Intangible assets Other assets 1,435,105 1,017,035 1,424,288 1,184,021 1,277,471 Total assets 648,663,988 833,471,970 1,181,868,334 1,528,126,238 1,715,645,026 Current Before 261,521,745 357,287,001 650,838,634 861,779,296 988,892,523 liabilitie Dist. s After 269,677,831 374,444,865 641,177,386 845,745,651 Note 2 Dist. Long-term 16,680,000 29,539,400 45,635,371 84,299,377 75,366,400 liabilities Other liabilities 9,295,396 6,790,115 4,801,573 4,215,877 4,853,916 Total Before 287,497,141 393,616,516 701,275,578 950,294,550 1,069,112,839 liabilitie Dist. s After 295,653,227 410,774,380 710,936,826 934,260,905 Note 2 Dist. Common stock 74,146,236 85,789,319 96,612,482 106,890,967 118,358,665 Capital surplus 52,944,370 57,308,705 65,011,063 70,693,639 77,266,078 Retaine Before 208,944,248 265,351,332 315,053,301 377,321,804 445,361,440 d Dist. earnings After 189,666,227 237,898,750 295,730,805 361,288,159 Note 2 Dist. Unrealized gain (loss) of financial 4,727,053 16,902,917 13,265,130 1,802,723 4,169,293 instruments Translation adjustments and 20,423,841 14,522,082 (9,330,319) 21,141,456 1,395,612 other equity adjustment Unrecognized pension cost Stockho Before 361,166,847 439,855,454 480,592,756 577,831,688 646,532,187 lders Dist. Equity After 353,010,761 422,697,590 470,931,508 561,798,043 Note 2 Dist. Note 1: All above years didnt process asset revaluation. Note 2: As of April 30, 2013, the amount of after distribution has not presented due to the proposal of earnings distribution of year 2012 had not yet been submitted to the shareholders' meeting.
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Concise Income Statement R.O.C. GAAP

Unit: NT$Thousand Period Item Operating revenue Gross profit t Operating income Non-operating income Non-operating expense Income from continuing operations before income taxes Net income for continuing operations Income from discontinued operations Extraordinary gain (loss) Translation adjustments and other equity adjustment Net income 2008 1,473,026,282 59,407,893 26,687,988 41,917,316 4,566,805 Most Recent 5-Year Financial Information 2009 1,420,573,052 63,675,490 24,788,398 58,471,359 1,148,277 2010 2,313,129,125 100,920,995 35,444,869 53,937,373 4,941,502 2011 2,773,311,378 107,826,879 31,500,286 64,478,317 4,187,129 2012 3,218,928,395 152,199,836 45,925,843 64,038,228 2,497,303
64,038,499
82,111,480
84,440,740
91,791,474
107,466,768
55,133,175
75,685,105
77,154,551
81,590,999
94,762,377
0 0
0 0
0 0
0 0
0 0
55,133,175
75,685,105
77,154,551
81,590,999
94,762,377
Basic earnings per share (NT$) 4.67 6.41 6.54 6.94 8.03 (Note 1) Note 1: EPSs are retroactively adjusted based on the number of shares of stock dividends as of Dec. 31, 2012. Note 2: The gross profit, operating income and non-operating expenses and losses have been reclassified due to the implementation of Financial Accounting Standards No. 10.
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(3) CPAs and Their Opinions for Most Recent 5-Years

Year 2008 2009 2010 2011 2012 Name of CPA Yong-jian Hsu, Yan-song Li Yong-jian Hsu, Yan-song Li Yong-jian Hsu, Yan-song Li Yong-jian Hsu, Ming-ling Xue Yong-jian Hsu, Ming-ling Xue Auditors Opinion Modified unqualified opinion Modified unqualified opinion Modified unqualified opinion Modified unqualified opinion Modified unqualified opinion Reason for Changing CPA Internal administrative organizational changes
B. Most Recent 5-Year Financial Analysis

(1) Financial Analysis
Period Item Financial Ratio % Ability to payoff debt (%) Total liabilities to total assets Long-term debts to fixed assets Current ratio Quick ratio Interest protection A/R turnover (times) A/R turnover days Inventory turnover (times) Account payable turnover (times) Days sales outstanding Fixed assets turnover (times) Total assets turnover (times) Return on assets (%) Return on equity (%) To pay-in capital Operating income % PBT Net margin (%) EPS (NT$) Cash flow ratio (%) Cash flow adequacy ratio (%) Cash reinvestment ratio (%) Operating leverage Financial leverage As of March 31, 2013 64.65 200.88 126.63 95.31 13.26 6.32 58 8.08 5.69 45 7.96 1.59 0.87 2.34 11.75 19.09 2.02 1.38 1.98 72.05 2.25 7.96 1.15
Ability to operate
Profitability
Cash flow %
Leverage
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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 Item Financial Ratio % Ability to payoff debt (%) Total liabilities to total assets Long-term debts to fixed assets Current ratio Quick ratio Interest protection A/R turnover (times) A/R turnover days Inventory turnover (times) Account payable turnover (times) Days sales outstanding Fixed assets turnover (times) Total assets turnover (times) Return on assets (%) Return on equity (%) To pay-in capital % Operating income PBT Net margin (%) EPS (NT$) Cash flow ratio (%) Cash flow % Cash flow adequacy ratio (%) Cash reinvestment ratio (%) Operating leverage Leverage Financial leverage 1.08 1.03 1.03 1.06 1.05 2008 44.32 969.66 121.68 85.52 35.65 7.87 46 14.70 10.76 25 38.42 2.32 8.92 15.49 38.29 86.37 3.74 5.19 23.04 33.26 9.82 1.80 Most recent 5-Year Financial Information 2009 47.31 1,485.77 123.01 97.33 108.17 6.97 52 14.83 7.56 25 40.27 1.92 10.28 18.9 28.89 95.71 5.33 7.12 15.59 66.86 9.18 2.02 2010 59.34 1,825.39 111.09 93.26 95.23 9.03 40 21.53 7.42 17 76.57 2.3 7.73 16.76 36.69 87.4 3.34 7.26 17.64 96.93 16.94 1.75 2011 62.19 1,953.99 111.21 95.82 51.24 7.46 49 21.62 6.29 17 88.44 2.05 6.13 15.42 29.47 85.87 2.94 7.65 ( 2) 83.09 ( 2) 1.93 2012 62.32 2,690.83 109.59 99.75 50.14 6.54 56 26.28 5.94 14 106.04 1.98 5.95 15.48 38.80 90.80 2.94 8.03 11.13 113.81 12.36 1.63
Ability to operate
Earning ability
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
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(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 (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 2012, 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:
2013 Regular Shareholders Meeting of the Company
Hon Hai Precision Industry Co., Ltd.
Supervisor:
Huang, Qing-yuan
On the Date of May 16, 2013
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Audit Report by Supervisors
The Board reports the financial statement, business report, and earnings distribution proposal of 2012, 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:
2013 Regular Shareholders Meeting of the Company
Supervisor: Fu-Rui International Investment Co., Ltd. Representative: Wan, Jui-hsia
On the Date of May 16, 2013
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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, 2011 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.
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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 its subsidiaries as of December 31, 2011 and 2012, and the related consolidated statements of income, of changes in stockholders equity and of cash flows for the years then ended, expressed in thousands of New Taiwan dollars. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audits. We did not audit the financial statements of certain consolidated subsidiaries which statements reflect total assets of $245,803,235,000 and $147,874,948,000, constituting 14.21% and 7.23% of the consolidated total assets as of December 31, 2011 and 2012, respectively, and total revenues of $405,044,774,000 and $154,940,895,000, constituting 11.73% and 3.97% of the consolidated total operating revenues for the years then ended, 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 included for these subsidiaries, is based solely on the reports of the other auditors. We conducted our audits in accordance with the Rules Governing the Examination 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 other auditors provide a reasonable basis for our opinion. In our opinion, based on our audits and the reports of other auditors, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Hon Hai Precision Industry Co., Ltd. and its subsidiaries as of December 31, 2011 and 2012, and the results of their operations and their cash flows for the years then ended in conformity with the Rules Governing the Preparation of Financial Statements by Securities Issuers and generally accepted accounting principles in the Republic of China.
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Hon Hai Precision Industry Co., Ltd. adopts International Financial Reporting Standards, International Accounting Standards, and relevant interpretations and interpretative bulletins (IFRSs) that are ratified by the Former Financial Supervisory Commission, Executive Yuan, R.O.C. (FSC) in the preparation of its financial statements effective January 1, 2013. Information relating to the adoption of IFRSs is disclosed in Note 13 under the requirements of Jin-Guan-Zheng-Shen-Zi Order No. 0990004943 of FSC, dated February 2, 2010. The IFRSs may be subject to changes during the time of transition; therefore, the actual impact of IFRSs adoption on Hon Hai Precision Industry Co., Ltd. may also change
PricewaterhouseCoopers, Taiwan March 28, 2013
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.
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HON HAI PRECISION INDUSTRY CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS) 2011 2012 NT$ NT$ ASSETS Current Assets Cash and cash equivalents (Note 4(1)) Financial assets at fair value through profit or loss - current (Note 4(2)) Available-for-sale financial assets - current (Note 4(3)) Notes and accounts receivable, net (Note 4(4)) Accounts receivable, net - related parties (Note 5) Other receivables (Notes 4(5) and 5) Other financial assets - current (Note 6) Inventories, net (Note 4(6)) Prepayments (Note 5) Deferred income tax assets - current (Note 4(15)) Funds and Investments Financial assets at fair value through profit or loss non-current (Note 4(2)) Available-for-sale financial assets - non-current (Note 4(3)) Financial assets carried at cost - non-current (Note 4(7)) Equity investments under the equity method (Note 4(8)) Prepayments for long-term investments (Note 4(8)) Other financial assets - non-current (Note 6) Property, Plant and Equipment (Notes 4(9) and 5) Cost Land Buildings and improvements Machinery Molding equipment Testing equipment Office equipment Tooling equipment Other equipment Cost and revaluation Less: Accumulated depreciation Accumulated impairment Construction in progress and prepayments for equipment Intangible Assets (Note 4(10)) Patent right Goodwill Other Assets Deferred charges Other assets - other (Note 4(11)) TOTAL ASSETS
329,793,633 70,329 674,287 450,757,984 25,291,811 34,679,896 46,741,750 380,521,794 7,119,919 8,016,419 1,283,667,822
505,526,956 140,220 777,410 597,578,990 35,469,651 38,235,975 947,222 349,882,643 7,647,041 6,751,334 1,542,957,442 179,300 8,302,853 8,620,722 44,492,047 982,430 854,748 63,432,100 3,900,934 166,307,528 285,431,007 2,741,721 24,704,409 15,292,609 3,539,459 48,275,054 550,192,721 191,244,750) 4,658,696) 36,008,944 390,298,219 3,448,500 505,969 3,954,469
4,790,319 4,046,796 40,259,657 1,545 24,179 49,122,496 4,225,808 151,455,281 246,249,077 3,633,968 24,948,040 15,863,541 3,270,354 43,977,326 493,623,395 165,396,856) 4,432,302) 31,579,244 355,373,481 695,266 695,266 15,101,778 26,350,582 41,452,360 $ 1,730,311,425
( (
( (
20,165,075 23,596,212 43,761,287 $ 2,044,403,517
(continued)
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HON HAI PRECISION INDUSTRY CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (CONTINUED) DECEMBER 31, (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS) 2011 NT$ LIABILITIES AND STOCKHOLDERS EQUITY Current Liabilities Short-term loans (Note 4(12)) Short-term notes and bills payable (Note 4(13)) Financial liabilities at fair value through profit or loss - current (Note 4(2)) Accounts payable Accounts payable - related parties (Note 5) Income tax payable (Note 4(15)) Accrued expenses (Notes 4(14)(20)) Payables for equipment (Note 5) Other payables Receipts in advance Long-term liabilities - current portion (Notes 4(16)(17)) Accrued warranty liabilities Other current liabilities Long-term Liabilities Bonds payable (Note 4(16)) Long-term loans (Note 4(17)) Other Liabilities Reserve for retirement plan (Note 4(18)) Deferred income tax liabilities - non-current (Note 4(15)) Other liabilities - other Total Liabilities Stockholders Equity Stockholders Equity of Parent Company Capital stock (Note 4(19)) Common stock Capital reserve (Note 4(21)) Paid-in capital in excess of par value of common stock Capital reserve from conversion of convertible bonds Capital reserve from long-term investments Capital reserve from conversion right (Note 4(16)) Retained earnings (Note 4(22)) Legal reserve Undistributed earnings Other adjustments to stockholders equity Cumulative translation adjustments Unrealized gain or loss on financial instruments (Note 4(3)) Treasury stock Stockholders' equity of parent company Minority interest Total stockholders' equity Commitments and Contingent Liabilities (Note 7) Subsequent Events (Note 9) TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
2012 NT$
260,522,749 7,989,312 251,834 519,725,102 28,769,177 19,939,503 87,322,885 28,177,904 5,835,155 5,584,781 3,000,000 21,417,453 3,180,188 991,716,043 62,378,777 53,600,100 115,978,877 1,064,300 1,793,747 4,738,974 7,597,021 1,115,291,941
297,572,165 7,991,597 66,767 602,755,794 35,614,847 19,177,206 137,224,165 49,996,281 6,718,815 27,681,170 50,226,736 11,415,509 3,583,255 1,250,024,307 74,980,461 30,707,957 105,688,418 1,103,395 468,606 5,387,638 6,959,639 1,362,672,364
106,890,967 34,724,228 18,482,483 15,452,488 2,034,440 51,821,402 325,500,402 21,141,456 ( 1,802,723 18,901) 577,831,688 37,187,796 615,019,484 $ 1,730,311,425 (
118,358,665 39,820,178 18,482,483 16,928,977 2,034,440 59,980,502 385,380,938 1,395,612 4,169,293 18,901) 646,532,187 35,198,966 681,731,153 $ 2,044,403,517
The accompanying notes are an integral part of these consolidated financial statements. See report of independent accountants dated March 28, 2013.
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HON HAI PRECISION INDUSTRY CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME FOR THE YEARS ENDED DECEMBER 31, (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS, EXCEPT EARNINGS PER SHARE DATA) 2011 NT$ Operating Revenue Sales (Note 5) Operating Costs Cost of goods sold (Notes 4(6)(24) and 5) Gross profit Operating expenses (Notes 4(20)(24)) Sales and marketing expenses General and administrative expenses Research and development expenses Total operating expenses Operating income Non-operating income and gains Interest income Investment income accounted for under the equity method (Note 4(8)) Dividend income Gain on disposal of property, plant and equipment (Note 5) Gain on disposal of investments (Note 4(3)) Foreign exchange gain - net Gain on valuation of financial assets (Note 4(2)) Gain on valuation of financial liabilities (Note 4(2)) Other non-operating income (Note 3) Total non-operating income and gains Non-operating expenses and losses Interest expense Financing charges (Note 4(4)) Impairment loss (Notes 4(3)(9)) Loss on valuation of financial assets (Note 4(2)) Loss on valuation of financial liabilities (Note 4(2)) Other non-operating losses Total non-operating expenses and losses Income before income tax Income tax expense (Note 4(15)) Consolidated net income Attributable to: Equity holders of the Company Minority interest $ 3,452,681,273 ( 3,186,298,789) 266,382,484 ( ( ( ( 72,749,672) 69,941,002) 40,846,782) 183,537,456) 82,845,028 8,424,751 3,151,898 167,904 155,628 584,107 8,981,365 5,976,471 27,442,124 ( ( ( ( ( ( ( 5,704,004) 482,813) 564,979) 28,311) 433,239) 537,606) 7,750,952) 102,536,200 ( 20,601,567) $ 81,934,633 $ $ 81,590,999 343,634 81,934,633 After income tax $ 6.97 ( 0.03) $ 6.94 $ 6.81 ( 0.03) $ 6.78 ( ( (
2012 NT$
$ 3,905,395,322 ( 3,575,766,285) 329,629,037 ( ( ( ( 104,581,183) 70,970,421) 45,626,952) 221,178,556) 108,450,481 13,348,559 2,792,985 144,580 153,958 1,644,484 1,435,180 21,776 9,314 4,381,750 23,932,586 9,596,761) 189,662) 3,427,380) ( 790,173) ( 14,003,976) 118,379,091 ( 26,591,950) $ 91,787,141 ( $ $ 94,762,377 2,975,236) 91,787,141 After income tax $ 7.78 0.25 $ 8.03 $ 7.60 0.24 $ 7.84
Earnings per common share (Note 4(23)) Basic earnings per common share Consolidated net income Minority interest Net income attributable to equity holders of the Company Diluted earnings per common share Consolidated net income Minority interest Net income attributable to equity holders of the Company
Before income tax $ 8.72 ( 0.07) $ 8.65 $ 8.52 ( 0.07) $ 8.45
Before income tax $ 10.03 0.27 $ 10.30 $ 9.78 0.26 $ 10.04
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HON HAI PRECISION INDUSTRY CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY FOR THE YEARS ENDED DECEMBER 31, (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS)
Capital Stock Retained Earnings Other Adjustments to Stockholders Equity Unrealized gain Cumulative ( loss) on translation financial adjustments instruments Treasury stock ($ 9,330,319) 30,471,775 $ 21,141,456 $ 21,141,456 ( 19,745,844) $ 1,395,612 $ 13,265,130 ( 8,892,143) ( 2,570,264) $ 1,802,723 $ 1,802,723 2,026,951 339,619 $ 4,169,293 ($ 18,901) ($ ($ 18,901) 18,901) ($ 18,901)
Common stock 2011 Balance at January 1, 2011 Appropriations of 2010 earnings (Note 1): Legal reserve Cash dividends Stock dividends Employees stock bonus Consolidated net income for 2011 Unrealized loss on financial assets Transfer due to expiry of convertible bonds Paid-in capital in excess of par Capital reserve from conversion right Adjustments due to changes in equities of long-term investments Cumulative translation adjustment Minority interest Balance at December 31, 2011 2012 Balance at January 1, 2012 Appropriations of 2011 earnings (Note 2): Legal reserve Cash dividends Stock dividends Employees stock bonus Consolidated net income for 2012 Unrealized loss on financial assets Adjustments due to changes in equities of long-term investments Cumulative translation adjustment Minority interest Balance at December 31, 2012 $ 96,612,482 9,661,248 617,237 $ 106,890,967 $ 106,890,967 10,689,096 778,602 $ 118,358,665
Capital Reserves $ 65,011,063 4,937,891 1,195,200 ( 1,195,200) 744,685 $ 70,693,639 $ 70,693,639 5,095,950 1,476,489 $ 77,266,078
Legal reserve $ 44,105,947 7,715,455 $ 51,821,402 $ 51,821,402 8,159,100 $ 59,980,502
Undistributed earnings $ 270,947,354 ( ( ( 7,715,455) 9,661,248) 9,661,248) 81,590,999 $ 325,500,402 $ 325,500,402 ( 8,159,100) ( 16,033,645) ( 10,689,096) 94,762,377 $ 385,380,938
Minority interest $ 32,853,249 343,634 3,990,913 $ 37,187,796 $ 37,187,796 ( 2,975,236) 986,406 $ 35,198,966
Total $ 513,446,005 ( 9,661,248) 5,555,128 81,934,633 ( 8,892,143) 1,195,200 ( 1,195,200) ( 1,825,579) 30,471,775 3,990,913 $ 615,019,484 $ 615,019,484 ( 16,033,645) 5,874,552 91,787,141 2,026,951 1,816,108 ( 19,745,844) 986,406 $ 681,731,153
Note 1: Directors' and supervisors' remuneration amounting to $0 and employees' bonus amounting to $5,555,128 had been deducted from the Consolidated Statement of Income in 2010. Note 2: Directors' and supervisors' remuneration amounting to $0 and employees' bonus amounting to $5,874,552 had been deducted from the Consolidated Statement of Income in 2011. The accompanying notes are an integral part of these consolidated financial statements. See report of independent accountants dated March 28, 2013.
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HON HAI PRECISION INDUSTRY CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS) 2011 2012 NT$ NT$ CASH FLOWS FROM OPERATING ACTIVITIES Consolidated net income $ 81,934,633 $ 91,787,141 Adjustments to reconcile consolidated net income to net cash provided by operating activities: (Reversal of allowance) provision for doubtful accounts and sales discount ( 1,235,775) 980,352 Depreciation 45,661,397 58,161,542 Amortization of intangible and other assets 5,794,344 9,721,785 Gain on disposal of property, plant and equipment, net ( 155,628) ( 153,958) Loss on impairment 564,979 3,427,380 Loss on valuation of financial assets and liabilities, net 205,917 9,812 Provision for inventory obsolescence and market price decline 4,827,280 2,777,797 Investment income accounted for under the equity method ( 3,151,898) ( 2,792,985) Cash dividends from long-term investments accounted for under the equity method 596,865 978,316 Gain on disposal of investments ( 584,107) ( 1,644,484) Amortization of discount on convertible bonds payable 645,094 666,334 Changes in assets and liabilities: Financial assets at fair value through profit or loss ( 9,412) ( 58,853) Notes receivable 6,379,705 4,100 Accounts receivable ( 64,911,164) ( 147,805,458) Accounts receivable - related parties ( 6,463,311) ( 10,177,840) Inventories ( 125,965,359) 18,919,000 Other receivables ( 3,786,611) ( 2,717,896) Prepayments ( 1,743,980) ( 527,121) Accounts payable 116,108,004 83,030,692 Accounts payable - related parties 5,232,965 6,845,670 Accrued expenses 33,779,206 55,775,832 Other payables ( 968,432) 883,660 Accrued warranty liabilities 7,863,653 ( 10,001,944) Income tax payable 5,313,499 ( 762,297) Receipts in advance ( 1,223,747) 22,096,389 Other current liabilities 1,569,014 403,067 Deferred income tax ( 5,042,428) ( 60,056) Accrued pension liabilities ( 26,712) 39,095 Net cash provided by operating activities 101,207,991 179,805,072 CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of property, plant and equipment ( 91,666,421) ( 70,144,320) Decrease in other financial assets - non-current 15,744,557 43,731,078 Increase in other assets ( 13,185,355) ( 14,444,913) Acquisition of land use right ( 2,545,301) ( 502,553) Increase in long-term equity investments ( 854,579) ( 2,806,699) Acquisition of financial assets carried at cost ( 963,826) ( 6,093,326) Proceeds from disposal of property, plant and equipment 4,495,537 6,093,536 Financial assets / liability at fair value through profit or loss ( 112,185) ( 384,917) Proceeds from disposal of funds and investments 2,339,899 12,548,867 Acquisition of available-for-sale financial assets - ( 7,740,334) Acquisition of subsidiary and assets, net of cash acquired ( 1,278,561) Acquisition of buy patent right - ( 3,448,500) Proceeds from disposal of land use right 1,855,833 102,608 ( 86,170,402) ( 43,089,473) Net cash used in investing activities (continued)
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HON HAI PRECISION INDUSTRY CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS) 2011 NT$ CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term loans (Decrease) increase in notes and bills payable Increase in long-term loans Increase in bonds payable Payment of bonds payable Payment of long-term loans Increase in other liabilities-other Payment of cash dividends Increase in minority interest Net cash provided by financing activities Net effect of changes in foreign currency exchange rates Net increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year 47,184,885 1,601,976) 22,029,600 18,000,000 ( 17,219,400) ( 16,128,700) 665,904 ( 9,661,248) 3,990,913 47,259,978 13,254,743 75,552,310 254,241,323 $ 329,793,633 ( $ $ 2012 NT$ 37,049,416 2,285 6,214,600 45,176,000 ( 3,000,000) ( 6,653,250) 648,664 ( 16,033,645) 986,406 64,390,476 ( 25,372,752) 175,733,323 329,793,633 $ 505,526,956 $ $ $ 8,928,971 24,697,266
Supplemental disclosures of cash flow information: Cash paid during the year for interest $ 4,673,272 Cash paid during the year for income tax $ 17,021,446 Cash paid for the acquisition of property, plant and equipment Increase in property, plant and equipment $ 108,335,664 Add: Payable beginning balance 11,197,683 Less: Payable ending balance ( 28,177,904) Effect of changes in foreign currency exchange rates 310,978 Cash paid $ 91,666,421 Investing activities with no cash flow effect: Unrealized gain (loss) on financial instruments Adjustment for change in value of available -for-sale financial assets ($ 8,892,143) Valuation of long-term investments accounted for under the equity method ( 2,570,264) ($ 11,462,407)
93,450,555 28,177,904 ( 49,996,281) ( 1,487,858) $ 70,144,320
2,026,951 339,619 2,366,570
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HON HAI PRECISION INDUSTRY CO., LTD. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2011 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 established on February 20, 1974. The Company began to be listed on the Taiwan Stock Exchange in June 1991. The Company merged with Premier Image Technology Corporation (Premier Corp.) on December 1, 2006. The main activities of the Company are the manufacture, processing and sales of connectors, cable, enclosures, 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. As of December 31, 2012, the Companys issued and outstanding capital was $118,358,665; the Company and its subsidiaries had approximately 1,290,000 employees. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying consolidated financial statements of the Company and its subsidiaries (collectively referred herein as the Group) are prepared in accordance with the Rules Governing the Preparation of Financial Statements by Securities Issuers and accounting principles generally accepted in the Republic of China. The Groups significant accounting policies are summarized below: 1) Basis for preparation of consolidated financial statements A. All majority-owned subsidiaries and controlled entities are included in the consolidated financial statements. Effective January 1, 2008, the Company prepares consolidated financial statements on a quarterly basis. The income (loss) of the subsidiaries is included in (excluded from) the consolidated statement of income effective on the date the Company gains (losses) control over the subsidiaries. Significant intercompany transactions and assets and liabilities arising from intercompany transactions are eliminated. B. Subsidiaries included in the consolidated financial statements and their changes in 2012: Ownership percentage (%) Investor Hon Hai Precision Industry Co., Ltd. Subsidiaries Foxconn (Far East) Limited and subsidiaries 2011.12.31 2012.12.31 Main operating activities Investment holdings in companies 100% 100% in Mainland China, Hong Kong, Europe and America primarily in engaged in manufacturing, sale, research and development of computer cases, connectors and computer components. Note (3)
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Ownership percentage (%) Investor Hon Hai Precision Industry Co., Ltd. Subsidiaries Main operating activities Foxconn Holding Investment holdings in AsiaPacific and America Ltd. and hi-tech companies subsidiaries Hyield Venture Venture capital investments in Capital Co., Ltd. companies primarily engaged in and subsidiaries manufacturing of automobile wires/electronic devices and electronic components, and services of planning, advisory and business management. Bao Shin Domestic investments in International companies primarily engaged in Investment development and sale of Co., Ltd. and computer systems, manufacturing and sale of machinery and subsidiaries equipment. Hon Yuan Domestic investments in International companies primarily engaged in Investment manufacturing and sale of Co., Ltd. and machinery and equipment. subsidiaries Hon Chi Domestic investments in International companies primarily engaged in Investment software and electronic Co., Ltd. and Information application services, subsidiaries and manufacturing and sale of machinery and equipment. Lin Yih Investment holdings in R.O.C. International companies Investment Co., Ltd. 2011.12.31 2012.12.31 100% 100% Note
97.50%
97.50%
100%
100%
100%
100%
100%
100%
100%
100%
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Ownership percentage (%) Investor Hon Hai Precision Industry Co., Ltd. Subsidiaries Hon Hai/ Foxconn Logistics California LLC. Hon Hai/ Foxconn Logistics Texas LLC. Ambit International Ltd. and subsidiaries Main operating activities Logistics services in America 2011.12.31 2012.12.31 100% 100% Note
Logistics services in America
100%
100%
Foxconn Singapore (Pte) Ltd. and subsidiaries Foxconn Patent applications in America. International Inc. Altus Technology Manufacture and design of Inc. cellular phone and camera lens and packaging of sensors Premier Image Manufacture and sale of camera Technology -Hong Kong Limited and subsidiaries Foxconn SA B.V. Investment holdings of Russian and subsidiaries domestic sales companies Margini Holdings Investment holdings in Vietnam Limited and export processing and subsidiaries construction services companies and Brazil domestic sales companies.
Investment holdings in companies in Mainland China primarily engaged in manufacturing and sale of power supply modules, application modules and network cables assemblies. Asia-pacific sales company
100%
100%
100%
100%
100% 100%
100% 100%
99.96%
99.96%
97.76% 100%
97.76% 100%
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Ownership percentage (%) Investor Hon Hai Precision Industry Co., Ltd. Subsidiaries 2011.12.31 2012.12.31 Main operating activities Foxconn Holdings Investment holdings in companies 100% 100% B.V.- Netherland in Europe. and subsidiaries Syntrend Creative Park Co., Ltd. Note
Retail of office machinery and 80% 80% equipment and electronic appliances, and information/ software services. (1) The financial statements of consolidated subsidiaries as of and for the years ended December 31, 2011 and 2012 were audited by independent accountants. (2) For the relevant information on indirectly owned subsidiaries of the Company, please refer to Note 11. (3) Changes in the consolidated subsidiaries a. In October, 2011, a subsidiary of the Company acquired 100% of Scientific-Atlanta Holdings B.V. and Scientific-Atlanta de Mexico, S. de R.L. de C.V., which were consolidated effective the acquisition date. b. 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. c. 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. d. 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. e. 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. Majority-owned subsidiaries that were not included in the consolidated financial statements: None. Adjustments for subsidiaries with different balance sheet dates: None. Special operating risks of the foreign subsidiaries: No significant special operating risks that would affect the financial statements. Significant restriction on remittance of funds from the foreign subsidiaries to the Company: None. The Companys common stock owned by its subsidiary:
C. D. E. F. G.
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As of December 31, 2011 and 2012, Hon Jin International Investment Co., Ltd. owned 1,184,375 and 1,302,812 shares, respectively, of the Companys common stock at a cost of $18,901. H. Information on new issuance of convertible bonds and common stock by subsidiaries: The issuance of convertible bonds and new common stock by subsidiaries had no significant effect on stockholders equity of the parent company. 2) Translation of financial statements of foreign subsidiaries into New Taiwan Dollars Assets and liabilities of foreign subsidiaries are translated into New Taiwan dollars using the exchange rates at the balance sheet date. Equity accounts are translated at historical rates except for beginning retained earnings, which is carried forward from prior years balance. Dividends are translated at the rates prevailing at the date of declaration. Profit and loss accounts are translated at weighted -average rates of the year. The resulting translation differences are included in cumulative translation adjustments under stockholders equity. 3) Criteria for classifying assets and liabilities as current or 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: 1) Assets arising from operating activities that are expected to be realized or consumed, or are intended to be sold within the normal operating cycle; 2) Assets held mainly for trading purposes; 3) Assets that are expected to be realized within twelve months from the balance sheet date; and 4) 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: 1) Liabilities arising from operating activities that are expected to be paid off within the normal operating cycle; 2) Liabilities arising mainly from trading activities; 3) Liabilities that are to be paid off within twelve months from the balance sheet date; and 4) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. 4) Use of estimates The preparation of financial statements in conformity with R.O.C. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as at the date of the financial statements and the amounts of revenues and expenses reported during the period. Actual results could differ from those assumptions and estimates. 5) Foreign currency transactions A. Transactions denominated in foreign currencies are translated into functional currency at the spot exchange rates prevailing at the transaction dates. Exchange gains or losses due to the difference between the exchange rate on the transaction date and the exchange rate on the date of actual receipt and payment are recognized in current years profit or loss.
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B. Monetary assets and liabilities denominated in foreign currencies are translated at the spot exchange rates prevailing at the balance sheet date. Exchange gains or losses are recognized in profit or loss. However, exchange gains or losses on overseas inter-company accounts that are, in nature, deemed long term is accounted for as a reduction in stockholders equity. C. Non-monetary items that are measured at fair value are translated using the exchange rates prevailing at the balance sheet date. When a gain or loss on a non-monetary item is recognized directly in equity, any exchange component of that gain or loss shall be recognized directly in equity. Conversely, when a gain or loss on a non-monetary item is recognized in profit or loss, any exchange component of that gain or loss shall be recognized in profit or loss. However, non-monetary items that are measured on a historical cost basis are translated using the exchange rate at the date of the transaction. 6) Cash equivalents Cash equivalents refer to short-term, highly liquid investments that meet both the following criteria: a) Readily convertible to known amount of cash; and b) Subject to an insignificant risk of changes in value resulting from fluctuations in interest rate. The statement of cash flows is compiled under the cash and cash equivalents basis. 7) Financial assets and financial liabilities at fair value through profit or loss A. Equity investments are recognized using trade date accounting. Debt instruments are recognized and derecognized using settlement date accounting. All are recognized initially at fair value. A fixed price commitment between trade date and settlement date meets the definition of a derivative except for a contract whose terms require delivery of the asset within the time frame established generally by regulation or convention in the marketplace concerned is recognized using trade date accounting or settlement date accounting. B. Financial assets or liabilities at fair value through profit or loss are subsequently re -measured and stated at fair value, and the gain or loss is recognized in profit or loss. The fair value of listed stocks, OTC stocks, closed-end mutual funds and deposit receipts is based on latest quoted fair prices of the accounting period. The fair value of open-end and balanced mutual funds is based on the net asset value at the balance sheet date. C. For derivatives that do not qualify for hedge accounting, if the derivative is an option, then the transaction is recognized at fair value on the trade date, and if the derivative is not an option, then the transaction is recognized at zero fair value on the trade date. D. The derivative features (such as call options and put options) embedded in bonds payable issued by the Company are described in Note 2 (20). 8) Available-for-sale financial assets A. Equity investments are recognized using trade date accounting. Bond investments are recognized and derecognized using settlement date accounting and are recognized initially at fair value plus transaction costs that are directly attributable to the acquisition of the financial asset. B. Available-for-sale financial assets are measured and stated at fair value, and the gain or loss is recognized in equity. The cumulative fair value changes are reclassified to profit and loss upon
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derecognition of the financial assets. The fair value of listed stocks, OTC stocks, closed -end mutual funds and deposit receipts is based on latest quoted fair prices of the accounting period. The fair value of open-end and balanced mutual funds is based on the net asset value at the balance sheet date. C. If there is any objective evidence that the financial asset is impaired; the cumulative loss that had been recognized directly in equity shall be transferred from equity to profit or loss. Impairment losses recognized previously in profit or loss for an investment in an equity instrument shall not be reversed through profit or loss, and if, subsequently, the fair value of a debt instrument increases and the increase can be objectively related to an event occurring after the impairment loss was recognized in profit or loss, the impairment loss shall be reversed, with the amount of the reversal recognized in profit or loss. 9) Financial assets carried at cost A. Investment in unquoted equity instruments is recognized using trade date accounting and is recognized initially at its fair value plus transaction costs that are directly attributable to the acquisition of the financial asset. B. If there is any objective evidence that the financial asset is impaired; the impairment loss is recognized in profit or loss. Such impairment loss cannot be reversed. 10) Settlement date accounting If an entity recognizes financial assets using settlement date accounting, any change in the fair value of the asset to be received during the period between the trade date and the settlement date / balance sheet date is not recognized for assets carried at cost or amortized cost. For financial asset or financial liability classified as at fair value through profit or loss, the change in fair value is recognized in profit or loss. For available-for-sale financial assets, the change in fair value is recognized directly in equity. 11) Notes and accounts receivable, other receivables A. Notes and accounts receivable are claims generated from the sale of goods or services. Other receivables are those receivables arising from transactions other than the sale of goods or services. Notes receivable, accounts receivable and other receivables are recognized initially at fair value and are subsequently measured at amortized cost using the effective interest method. B. The Group assesses whether objective evidence of impairment exists individually or collectively for financial assets that are not individually significant. If there is objective evidence that an impairment loss has been incurred, the amount of the loss is recognized and measured as the difference between the assets carrying amount and the present value of estimated future cash flows discounted at the financial assets original effective interest rate. If the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized, the previously recognized impairment loss shall be reversed. The reversal shall not result in a carrying amount of the financial asset that exceeds what the amortized cost would have been had the impairment not been recognized at the date the impairment is reversed. The amount of the reversal shall be recognized in profit or loss. 12) Inventories The perpetual inventory system is adopted for inventory recognition. Inventories are stated at cost. The
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cost is determined using the weighted-average method. At the end of period, inventories are evaluated at the lower of cost or net realizable value, and the individual item approach is used in the comparison of cost and net realizable value. The calculation of net realizable value is based on the estimated selling price in the normal course of business, net of estimated costs of completion and estimated selling expenses. As the value of raw materials declines and the cost of finished goods is over the net realizable value, the net realizable value of raw materials is determined based on current replacement cost. 13) Long-term equity investments accounted for under the equity method A. Long-term equity investments in which the Group holds more than 20% of the investee companys voting shares or has the ability to exercise significant influence on the investees operational decisions are accounted for under the equity method. The excess of the initial investment cost over the acquired net asset value of the investee attributable to goodwill is no longer amortized from 2006. Retrospective adjustment of the amount of goodwill amortized in previous years is not required. Goodwill is subject to tests of impairment on an annual basis. The excess of acquired net asset value of investee over the initial investment cost is allocated proportionately and applied as a reduction to the book values of identifiable non-current assets, and any remaining amount of such excess after this allocation is credited to extraordinary gains. B. Long-term investment in which the Group holds more than 50% of the investee companys voting shares or has the ability to control the investees operational decisions are accounted for under the equity method and included in the consolidated financial statements on a quarterly basis. C. Exchange differences arising from translation of the financial statements of overseas investee companies accounted for under the equity method are recorded as cumulative translation adjustments in proportion to the Companys ownership under stockholders' equity. 14) Property, plant and equipment A. Property, plant and equipment are stated at cost. Costs incurred to bring the assets to the condition and location necessary for their intended uses are capitalized. Significant servicing or betterments capable of generating future economic benefits are capitalized and depreciated accordingly. Maintenance and repairs are expensed as incurred. B. Depreciation is provided under the straight-line method based on the assets estimated economic service lives. The useful lives of property, plant and equipment are 3 to 9 years, except for buildings, the useful life of which is 6 to 51 years. 15) Goodwill and other intangible assets A. The excess of the initial acquisition cost over the fair value of the acquired identifiable tangible and intangible assets is attributable to goodwill. B. Royalties paid on the acquisition of technical patent authorization are stated at cost and amortized on a straight-line basis over its estimated economic life. 16) Deferred charges and other assets A. The costs of telephone network installation charges, computer software, molding and tools equipment are recorded as deferred charges and amortized over their estimated economic lives on a
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straight-line basis. B. Land use rights are stated at cost and amortized over the lease period using the straight -line method. 17) Impairment of non-financial assets The Group recognizes impairment loss when there is indication that the recoverable amount of an asset is less than its carrying amount. The recoverable amount is the higher of the fair value less costs to sell and value in use. The fair value less costs to sell is the amount obtainable from the sale of the asset in an arms length transaction after deducting any direct incremental disposal costs. The value in use is the present value of estimated future cash flows to be derived from continuing use of the asset and from its disposal at the end of its useful life. When the impairment no longer exists, the impairment loss recognized in prior years shall be reversed. The recoverable amount of goodwill shall be evaluated periodically. Impairment loss will be recognized whenever the recoverable amount of the goodwill is less than its carrying amount. Impairment loss of goodwill recognized in prior years is not reversed in the following years. 18) Warranty obligation Warranty obligation is recognized based on the estimated warranty cost per unit and the number of units sold during the period. 19) Pension plan Under the defined benefit pension plan, net periodic pension costs are recognized in accordance with the actuarial calculations. Net periodic pension costs include service cost, interest cost, and expected return on plan assets, and amortization of unrecognized net transition obligation and actuarial gains or losses. Unrecognized net transition obligation is amortized on a straight-line basis over 15 years. Under the defined contribution pension plan, net periodic pension costs are recognized as incurred. 20) Bonds payable For bonds issued with embedded conversion, put, or call option feature after January 1, 2006, the issuer shall classify the issuance price based on the substance of the contractual arrangement on initial recognition, and recognize the elements separately as a financial asset, financial liability, or an equity instrument. These bonds are accounted for as follows: A. The difference between the issue price and face value of convertible corporate bonds is accounted for as premium or discount which is required to be amortized over the period from the date of issuance to maturity date using the interest method and is recorded as interest expense. B. The value of any derivative features (such as a call option and put option) embedded in the compound financial instrument is recognized as financial assets or financial liabilities at fair value through profit or loss. These derivative features are subsequently re-measured and stated at fair value on each balance sheet date, and the gain or loss is recognized in gain or loss on valuation of financial assets or financial liabilities. At the maturity of the redemption period, if the fair value of common stock exceeds the redemption price, the fair value of the put option is recognized as capital reserve; however, if the fair value of common stock is lower than the redemption price, the fair value of the put option is recognized as gain or loss.
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C. A conversion right embedded in the bonds issued by the Company, which is convertible to an equity instrument, is recognized in capital reserve from conversion right. When a bondholder exercises his/her conversion rights, the liability component of the bonds (including corporate bonds and embedded derivatives) shall be revalued at fair value on the conversion date, and the resulting difference shall be recognized as gain or loss in the current period. The book value of the common stock issued due to the conversion shall be based on the adjusted book value of the abovementioned liability component plus the book value of the stock conversion option. D. Costs incurred on issuance of convertible bonds are proportionately charged to the liabilities and equities of the underlying instruments based on initial recognition amount. E. In the event that the bondholders may exercise put options within the following year, the underlying bonds payable shall be reclassified to current liabilities. The bonds payable whose put options are unexercised during the exercisable period shall be reclassified to non-current liabilities. 21) Income tax A. Income tax expense is provided based on accounting income after adjusting for permanent differences. The provision for income tax includes deferred income tax for the expected future tax consequences of events that have been included in different periods for financial or tax reporting purposes. Deferred income tax assets and liabilities are determined using enacted tax rates in effect for the year(s) in which the differences are expected to reverse. Valuation allowance on deferred income tax assets is recognized to the extent that it is more likely than not that the income tax benefits will not be realized. Over or under provision of income tax from the previous years is recorded as adjustment to the current years income tax expense. In accordance with the ROC Income Tax Law, the companys undistributed income is subject to an additional 10% corporate income tax. The tax is charged to income tax expense after the appropriation of earnings is approved by the stockholders in the following year. B. Income tax credits are provided for in accordance with R.O.C. SFAS No. 12, "Accounting for Income Tax Credits". Income tax credits arising from acquisitions of equipment or technology, expenditures for research and development, training and development of employees and investments in qualified stocks are charged to deferred income tax assets and credited to income tax expense in the period the related expenditures are incurred. C. Effective January 1, 2006, the Company adopted the Income Basic Tax Act (the Act). Under the Act, the income tax payable shall be the higher of the basic tax and the regular income tax in accordance with the Income Tax Law and other relevant laws. D. As a result of the amendment of the Income Tax Law, the Company recalculated its deferred tax assets and liabilities and recorded the resulting difference in the current years income tax benefit or expense. 22) Government grants In accordance with R.O.C. SFAS No. 29, Government Grants, government grants related to assets are recognized as deferred income; for depreciable assets, it is recognized as income over the useful life period of the asset in proportion to which depreciation expense on those assets is recognized. For non-depreciable assets that require the fulfillment of certain obligations, it would then be recognized
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as income over the periods that bear the cost of meeting the obligations. If the government grant relates to receiving financial consideration, it is recognized as income when earned, or as deferred income (shown as other liabilities) and recognized in periods over which the grant will be earned. 23) Treasury stock A. When shares are bought back by the Company, the treasury stock is accounted for as a deduction of the equity. B. Any excess of the proceeds over the cost of the treasury stock reissued is recognized as an increase in additional paid-in capital from the treasury stock transaction and if the proceeds are less than the cost, the deficit is charged to the additional paid-in capital account. Should the paid-in capital in excess of par value of common stock balance be insufficient to absorb the deficit, the balance is charged to retained earnings. C. Treasury stock cost is determined using the weighted-average cost method. D. The Company's common stock owned by its subsidiaries is treated as treasury stock. 24) Share-based payment - employee compensation plan Based on the employee stock options and the share-based payment agreements, the Company shall measure the services received during the vesting period by reference to the fair value of the equity instruments granted and account for those amounts as payroll expenses during that period. 25) Employees bonuses and directors and supervisors remuneration Effective January 1, 2008, pursuant to EITF 96-052 of the Accounting Research and Development Foundation, R.O.C., dated March 16, 2007, Accounting for Employees Bonuses and Directors and Supervisors Remuneration, the costs of employees bonuses and directors and supervisors remuneration are accounted for as expenses and liabilities, provided that such recognition is required under legal or constructive obligation and the amounts can be estimated reasonably. However, if the accrued amounts for employees bonuses and directors and supervisors remuneration are significantly different from the actual distributed amounts resolved by the stockholders at their annual stockholders meeting subsequently, the differences shall be recognized as gain or loss in the following year. In addition, according to EITF 97-127 of the Accounting Research and Development Foundation, R.O.C., dated March 31, 2008, Criteria for Listed Companies in Calculating the Number of Shares of Employees Stock Bonus, the Company calculates the number of shares of employees stock bonus based on the closing price of the Company's common stock 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. 26) Earnings per share Basic earnings per share is calculated by dividing net income by the weighted -average number of shares outstanding during the period. Diluted earnings per share is calculated by taking into account the potentially dilutive securities which are assumed to have been converted to common stock at the beginning of the period. Anti-dilutive potential common shares are ignored in calculating dilutive earnings per share. 27) Revenues and expenses Revenues are recognized when the earning process is substantially completed and are realized or
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realizable. Related costs are recognized to match the timing of revenue recognition. Expenses, including research and development costs, are recognized as incurred. 28) Operating segments Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker is responsible for allocating resources and assessing performance of the operating segments. In accordance with R.O.C. SFAS No. 41, Operating Segments, segment information is disclosed in the consolidated financial statements rather than in the separate financial statements of the Company. 3. CHANGES IN ACCOUNTING PRINCIPLES 1) Notes and accounts receivable, other receivables Effective January 1, 2011, the Group adopted the amendments of R.O.C. SFAS No. 34, Financial Instruments: Recognition and Measurement. The Group recognizes impairment loss on notes receivable, accounts receivable and other receivables when there is an objective evidence of impairment. As a result of the adoption of the amended SFAS No. 34, the Groups consolidated net income increased by $982,020 and consolidated earnings per share increased by $0.09 (in dollars) for the year ended December 31, 2011. 2) Operating segments Effective January 1, 2011, the Group adopted the newly issued R.O.C. SFAS No. 41, Operating Segments to replace the original R.O.C. SFAS No. 20, Segment Reporting. This change in accounting principle had no significant effect on net income and earnings per share for the year ended December 31, 2011. 4. DETAILS OF SIGNIFICANT ACCOUNTS (1) Cash and cash equivalents December 31, 2011 2012 Cash on hand $ 4,201,508 $ 6,157,872 Checking accounts 4,011,744 4,618,703 Savings deposits 105,922,445 132,081,859 Time deposits 206,682,107 353,871,385 320,817,804 496,729,819 Cash equivalents 8,975,829 8,797,137 $ 329,793,633 $ 505,526,956 Cash equivalents include the Sweep Fund.
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(2) Financial assets and liabilities at fair value through profit or loss December 31, 2011 Contract amount (Nominal principal) Book value (in thousands) Current assets Open-end funds $ 24,412 Forward exchange contracts 45,917 HUF(BUY) 1,107,070 JPY(BUY) 245,283 MXN(BUY) 28,090 RMB(BUY) 815,616 USD(BUY) 12,249 EUR(SELL) 16,500 INR(SELL) 290,008 USD(SELL) 123,096 $ 70,329 Non-current assets 15,078 Forward exchange contracts ($ 251,834) BRL(BUY) 2,220 CHF(BUY) 4,137 EUR(BUY) 2,631,660 HUF(BUY) 688,646 MXN(BUY) 634,437 USD(BUY) 8,500 EUR(SELL) 39,050 INR(SELL) RMB(SELL) 4,035,869 65,700 USD(SELL) ($ 251,834)
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December 31, 2012 Contract amount (Nominal principal) Book value (in thousands) Current asset Open-end funds Forward exchange contracts $ 83,265 56,955 KRW(BUY) RMB(BUY) MXN(BUY) USD(BUY) EUR(BUY) RMB(SELL) INR(SELL) USD(SELL) 1,949,780 1,582,660 143,772 75,061 68 437,972 276,824 262,800
$ Non-current asset Designated as at fair value through profit loss Corporate bonds Current liabilities Forward exchange contracts
140,220
$ ($
179,300 66,767) MXN(BUY) USD(BUY) JPY(BUY) RMB(SELL) USD(SELL) BRL(SELL) EUR(SELL) INR(SELL) 714,991 153,903 7,388 879,519 55,950 10,872 6,600 1,295
($ 66,767) 1) For the year ended December 31, 2011, the Group recognized a net loss of $461,550, including unrealized loss of $205,917. 2) For the year ended December 31, 2012, the Group recognized a net gain of $31,090, including unrealized loss of $9,812. 3) On March 27, 2012, the Companys 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 27,500,000 thousand 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 ROC SFAS No. 34, 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
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longer met the recognition criteria of a forward contract specified in ROC SFAS No. 34. 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. (3)Available-for-sale financial assets December 31, 2011 2012 Current items: Listed stocks $ 59,990 $ 57,610 Adjustment of available-for-sale financial assets 614,297 719,800 $ 674,287 $ 777,410 Non-current items: Listed stocks $ 4,343,859 $ 5,427,810 Adjustment of available-for-sale financial assets 446,460 2,875,043 $ 4,790,319 $ 8,302,853 1. The fair value of available-for-sale financial assets decreased by $11,462,407 and increased by $2,366,570 for the years ended December 31, 2011 and 2012, respectively, and is shown as an adjustment to stockholders equity as unrealized gain or loss on financial instruments. The transfers from this equity account to loss amounted to $0 and $872,963 (shown as gain on disposal of investment) for the years ended December 31, 2011 and 2012, respectively. 2. The Companys subsidiaries have evaluated the above financial assets and recognized impairment loss of $363,601 and $0 for the years ended December 31, 2011 and 2012, respectively. (4) Notes and accounts receivable December 31, 2011 2012 Notes receivable $ 781,288 $ 777,187 Accounts receivable 453,197,281 601,002,740 ( 1,835,555) ( 2,224,178) Less: Allowance for doubtful accounts ( 1,385,030) ( 1,976,759) Allowance for sales allowances $ 450,757,984 $ 597,578,990 1. 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, 2011 and 2012, the relevant information of accounts receivable factored but unsettled were as follows:
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December 31, 2011

Interest rate (%) Accounts receivable sold/ derecognized Amount advanced
Institutions
Amount retained
Limit
Mega International 1.70 Commercial Bank Taipei Fubon Bank 1.28~1.30 Mizuho Corporate 1.07 Bank Sumitomo Mitsui 0.95 Banking Corporation Standard Chartered 1.50 Commercial Bank
$ 3,466,775 24,224,000 5,753,200 10,598,000
$ 3,466,775 $ 24,224,000 5,753,200 10,598,000
$22,710,000 43,906,000 18,168,000 10,598,000
340,374 $ 44,382,349
340,374 $44,382,349 $
3,633,600 $99,015,600
December 31, 2012

Interest rate (%) Accounts receivable sold/ derecognized Amount advanced
Institutions
Amount retained
Limit
Mega International Commercial Bank Taipei Fubon Bank Mizuho Corporate Bank ING Bank, N.V.
0.90 0.99 0.94 1.1205
$ 8,712,000 23,232,000 5,227,200 7,550,400 $ 44,721,600
$ 8,712,000 23,232,000 5,227,200 7,550,400 $44,721,600
$21,780,000 36,300,000 8,712,000 14,520,000 $81,312,000
2. As of December 31, 2011 and 2012, the Group has signed promissory notes amounting to $3,542,760 (US$117 million) and $4,065,600 (US$140 million) as guarantee for those accounts receivable in commercial dispute, respectively. 3. For the years ended December 31, 2011 and 2012, the financing charges (expenses) incurred from accounts receivable factoring were $482,813 and $189,662 (shown as financing charges), respectively.
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(5) Other receivables December 31, 2011 25,442,053 $ 1,564,834 7,673,009 34,679,896 2012 30,598,424 1,891,534 5,746,017 38,235,975
Tax refund receivable Receivable from purchase made on behalf of related parties Others (6) Inventories
Raw materials and supplies Work in process Finished goods Inventory in transit Less: Allowance for inventory obsolescence and market price decline
December 31, 2011 95,943,901 $ 73,841,392 196,627,104 29,648,996 396,061,393
2012 87,707,668 103,684,540 156,262,122 20,496,593 368,150,923
15,539,599) ( 18,268,280) $ 380,521,794 $ 349,882,643 Expenses and losses incurred on inventories for the years ended December 31, 2011 and 2012 were as follows: For the years ended December 31, 2011 2012 $ 3,181,209,951 $ 3,573,047,465 4,827,280 261,558 $ 3,186,298,789 2,777,797 ( 58,977) $ 3,575,766,285
Cost of inventories sold Loss on inventory obsolescence and market price decline Others (7) Financial assets carried at cost
December 31, 2011 2012 $ 4,046,796 $ 8,620,722 Emerging stocks and unlisted stocks These investments have no active quoted market price and their fair values cannot be measured reliably. Therefore, they were measured at cost.
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(8) Long-term equity investments accounted for under the equity method December 31, 2011 Ownership Percentage (%) Book value 30 $16,680,857 43 7,644,526 27 2,797,361 31 2,440,357 9 2,074,231 29 1,345,316 45 941,679 6,335,330 40,259,657 1,545 $40,261,202 December 31, 2012 Ownership Percentage (%) Book value 30 $18,671,104 41 8,444,318 27 2,959,223 28 2,943,407 9 2,231,052 29 1,491,078 45 818,234 6,933,631 44,492,047 982,430 $45,474,477
Investee Company Foxconn Technology Co., Ltd. Zhen Ding Technology Holding Limited Pan International Industrial Corporation G-Tech Optoelectronics Corporation Simplo Technology Co., Ltd. ESON Precision Ind. Co. Ltd. Ampower Holding Limited - Cayman Others Add: Prepaid long-term investment
1) For the years ended December 31, 2011 and 2012, the investment income recognized under the equity method amounted to $3,151,898 and $2,792,985, respectively. 2) For the years ended December 31, 2011 and 2012, cash dividends declared by the investee companies accounted for under the equity method amounted to $596,865 and $978,316, respectively, and were shown as a reduction to the book value of long-term investments accounted for under the equity method. (9) Property, plant and equipment December 31, 2011 Accumulated Net Original cost depreciation book value Land $ 4,225,808 $ $ 4,225,808 Buildings and improvements 151,455,281 ( 31,385,787) 120,069,494 Machinery 246,249,077 ( 85,373,074) 160,876,003 Molding equipment 3,633,968 ( 2,241,472) 1,392,496 Testing equipment 24,948,040 ( 14,378,776) 10,569,264 Furniture and fixtures 15,863,541 ( 10,252,415) 5,611,126 Tooling equipment 3,270,354 ( 1,340,102) 1,930,252 43,977,326 ( 20,425,230) 23,552,096 Miscellaneous equipment Prepayments for equipment and construction in progress 31,579,244 31,579,244 $ 525,202,639 ($ 165,396,856) 359,805,783 Less: Accumulated impairment ( 4,432,302) $ 355,373,481
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36,008,944 394,956,915 Less: Accumulated impairment ( 4,658,696) $ 390,298,219 The Group recognized impairment loss of $201,378 and $3,427,380 (shown as impairment loss) in 2011 and 2012, respectively. For the years ended December 31, 2011 and 2012, the accumulated impairment is as follows: 2011 2012 Net book value, January 1 $ 5,220,239 $ 4,432,302 Increase in current year 201,378 3,427,380 Disposal in current year ( 683,758) ( 2,901,955) Cumulative translation adjustments ( 305,557) ( 299,031) $ 4,432,302 $ 4,658,696 Net book value, December 31 (10) Intangible assets 1) Business acquisition In October, 2011, the Companys subsidiary, PCE Paragon Solutions kft., acquired from Cisco System, Inc. 100% ownership of its subsidiaries, Scientific-Atlanta Holdings BV and ScientificAtlanta de Mexico S. de R.L. de C.V., for a cost of US$ 43,697 thousand. 2) Goodwill For the years ended December 31, 2011 2012 $ 215,474 $ 695,266 483,316 ( 3,524) ( 189,297) $ 695,266 $ 505,969
Land Buildings and improvements Machinery Molding equipment Testing equipment Furniture and fixtures Tooling equipment Miscellaneous equipment Prepayments for equipment and construction in progress
December 31, 2012 Accumulated Original cost depreciation $ 3,900,934 $ 166,307,528 ( 39,502,668) 285,431,007 ( 101,166,810) 2,741,721 ( 2,105,513) 24,704,409 ( 14,936,486) 15,292,609 ( 10,981,400) 3,539,459 ( 1,115,235) 48,275,054 ( 21,436,638) 36,008,944 $ 586,201,665 ($ 191,244,750)
Net book value $ 3,900,934 126,804,860 184,264,197 636,208 9,767,923 4,311,209 2,424,224 26,838,416
Net book value, January 1 Increase in current year Cumulative translation adjustments Net book value, December 31
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The above amount mainly represents goodwill arising from the companys subsidiarys acquisition of Scientific-Atlanta de Mexico S. de R.L. de C.V. in 2011. 3) Patent right December 31, 2012 Accumulated Original Cost Amortization Book Value Net book value, January 1 $ $ $ Increase in current year 3,448,500 3,448,500 $ 3,448,500 $ $ 3,448,500 Net book value, December 31 (11) Other assets December 31, 2011 2012 Land use rights $ 21,300,084 $ 18,493,237 Others 5,050,498 5,102,975 $ 26,350,582 $ 23,596,212 For the years ended December 31, 2011 and 2012, the land use rights were as follows: For the years ended December 31, 2011 2012 Net book value, January 1 $ 20,268,938 $ 21,300,084 Increase in current year 2,545,301 502,553 Disposal in current year ( 1,855,833) ( 2,263,769) Amortization in current year ( 382,443) ( 392,646) Cumulative translation adjustments 724,121 ( 652,985) $ 21,300,084 $ 18,493,237 Net book value, December 31 Disposal of land use rights in current year includes disposal of subsidiaries. (12) Short-term loans December 31, 2011 2012 Credit loans $ 189,861,503 $ 297,551,360 Secured loans 70,661,246 20,805 $ 260,522,749 $ 297,572,165 0.55%~3.6% 0.3554%~5.85% Interest rates per annum
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(13) Short-term notes and bills payable December 31, 2011 2012 $ 8,000,000 $ 8,000,000 ( 10,688) ( 8,403) $ 7,989,312 $ 7,991,597 0.998%~1.158% 0.948%~1.028% December 31, Awards and salaries payable Royalty fees payable Consumption goods expense payable(including indirect materials) Employees bonuses payable Tax payable (excluding VAT) Shipping fees payable Business tax (VAT) payable Accrued molding expense Others $ 2011 25,818,394 19,727,839 4,442,314 5,874,552 2,507,583 2,363,450 3,220,579 230,783 23,137,391 87,322,885 $ 2012 44,352,676 18,565,601 15,697,913 7,247,437 4,098,884 3,011,635 2,671,108 2,654,620 38,924,291 137,224,165
Commercial paper Less: unamortized discount Interest rates per annum (14) Accrued expenses
(15) Income tax 1) Income tax expense and income tax payable are reconciled as follows: December 31, 2011 Income tax expense $ 20,601,567 Changes in deferred income tax 5,042,428 Less: Prepaid income tax and income tax withheld ( 6,673,379) Effect of tax rate different from the U.S. branch ( 49,793) Over provision of prior years' income tax ( 556,981) Add: Income tax payable for prior years 1,575,661 $ 19,939,503 Income tax payable
$ ( ( ( $
2012 26,591,950 60,056 9,372,641) 69,122) 315,890) 2,282,853 19,177,206
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2) As of December 31, 2010 and 2011, the deferred income tax assets and liabilities were as follows: December 31, 2011 2012 $ 10,150,273 $ 10,431,693 Deferred income tax assets ($ 3,927,601) ($ 4,148,965) Deferred income tax liabilities 3) The temporary differences and related amounts of deferred tax assets (liabilities) are listed as follows: December 31, 2011 2012 Amount Tax effect Amount Tax effect Current items: Allowance for sales allowances $ 1,385,030 $ 235,455 $ 1,976,759 $ 336,049 Reserve for inventory obsolescence and market price decline 8,100,008 1,425,601 6,891,828 1,241,694 Unrealized exchange loss (gain) 1,109,138 83,458 ( 3,763,506) ( 639,558) Product warranty 19,312,929 3,298,507 9,291,820 1,579,609 Unrealized expenses 14,755,755 2,829,602 23,629,308 3,857,661 Others 610,818 143,796 1,832,433 375,879 $45,273,678 $ 8,016,419 $39,858,642 $ 6,751,334 Non-current items: Reserve for pension cost $ 875,352 $ 148,867 $ 904,575 $ 153,945 Foreign investment income accounted for under the equity method ( 24,413,045) ( 3,927,601) ( 20,643,569) ( 3,509,407) Difference from finance and tax due to depreciation expense 3,813,275 957,037 9,566,113 1,557,402 Others 5,784,156 1,027,950 5,294,984 1,329,454 ($13,940,262) ($ 1,793,747) ($ 4,877,897) ($ 468,606) 4) As of December 31, 2012, the Companys income tax returns through 2009 have been approved by the R.O.C. Tax Authority.
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(16) Bonds payable December 31, 2011 Convertible bonds payable 2010 1st unsecured euro convertible bonds payable Less: Discount on bonds payable Exchange loss Corporate bonds payable First unsecured corporate bonds issue in 2005 First debenture issue of 2009 First debenture issue of 2010 First debenture issue of 2011 Second debenture issue of 2011 Third debenture issue of 2011 First debenture issue of 2012 Second debenture issue of 2012 Third debenture issue of 2012 Fourth debenture issue of 2012 Foreign bonds Foreign unsecured corporate bonds USD-denominated Less: Discount on bonds payable Total Less: Current portion Bonds payable long-term $ ( ( 31,251,000 1,260,384) 931,839) 29,058,777 5,500,000 6,820,000 6,000,000 6,000,000 7,050,000 4,950,000 36,320,000 65,378,377 3,000,000) 62,378,777 $ ( ( 2012 31,251,000 557,938) 2,171,526) 28,521,536 2,500,000 6,820,000 6,000,000 6,000,000 7,050,000 4,950,000 9,000,000 6,000,000 8,000,000 3,300,000 59,620,000
( $
18,876,000 ( 105,539) 18,770,461 106,911,997 ( 31,931,536) $ 74,980,461
1) 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. The conversion price shall be adjusted based on the terms of the convertible bonds. As of December 31, 2012, the convertible bonds have not been converted. The adjusted conversion price was $111.592 (in dollars) per share with a fixed exchange rate applicable on bonds of NTD$31.251=USD$1. C. Under the terms of the convertible bonds, all the repurchased, previously redeemed or converted
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bonds will be retired and not to be re-issued. D. Under the terms of the convertible bonds, the rights and obligations of the new shares converted from convertible bonds are the same as those of the issued and outstanding common stock. E. The effective interest rate of the bonds was 2.02%. F. The fair value of conversion right in the amount of $2,034,440 was separated from bonds payable at issuance date, and was recognized in Capital reserve from conversion right in accordance with SFAS No. 36. G. First unsecured corporate bonds issue in 2010 had been reclassified to Current liabilities in the fourth quarter of 2012. 2) First unsecured corporate bonds issue in 2005 A. 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, 2012, 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 Normal bonds Issuance date Period Amount interest rate Payment term Bond Da to September 2005 10 years $ 500,000 2.37% Principal is due at maturity. De Interest is paid annually at simple interest rate. 3) 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: Nominal Issuance date Period Amount interest 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. 2009 1st unsecured corporate bonds payable of $3,410,000 had been reclassified to Current liabilities in the fourth quarter of 2012.
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4) First debenture issue of 2010 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: Nominal Issuance date Period Amount interest 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. 5) 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: Nominal Issuance date Period Amount interest 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. 6) 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: Normal Type of bonds Issuance date Period Amount interest 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. 7) 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: Nominal Issuance date Period Amount interest rate Payment term
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Issuance date July 2011
Period 5 years
Amount $ 4,950,000
Nominal interest rate 1.51%
Payment term Principal is due at maturity. Interest is paid annually at simple interest rate.
8) 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 March 2012 Period 5 years Amount $ 9,000,000 Nominal interest rate 1.34% Payment term Principal is due at maturity. Interest is paid annually at simple interest rate.
9) 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: Nominal Issuance date Period Amount interest 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. 10) 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: Nominal Issuance date Period Amount interest 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.
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11) 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: Nominal Issuance date Period Amount interest 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. 12) 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. The terms of these foreign unsecured bonds are summarized as follows: Issuance date Period Amount Nominal interest rate December 2012 5 years USD 650 million 2.125% (17) Long-term loans Institution Loan period Mizuho Corporate Bank 2008/8/21~2013/8/21 Ltd., etc. syndicated loan 2008/9/11~2013/9/11 ING Bank, N.V. etc. 2010/10/22~2015/10/22 syndicated loan Mizuho Corporate Bank 2011/3/31~2014/3/31 Ltd., etc. syndicated loan China Development 2011/8/12~2014/8/12 Industrial Bank First Commercial Bank 2011/11/30~2026/11/30 Interest rate December 31, 2011 $ 12,263,400 Limit (USD405 million)
13,626,000 5,681,100 19,920,600
(USD450 million) (EUR145 million) (JPY51 billion)
2,000,000 109,000 $ 53,600,100 0.7729%~1.8040%
(NTD2.5 billion) (NTD2.5 billion)
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Institution Mizuho Corporate Bank Ltd., etc. syndicated loan ING Bank, N.V. etc. syndicated loan Mizuho Corporate Bank Ltd., etc. syndicated loan China Development Industrial Bank First Commercial Bank Mizuho Corporate Bank Ltd. Citibank Less: Current portion Interest rate
Loan period 2008/8/21~2013/8/21 2008/9/11~2013/9/11 2010/10/22~2015/10/22 2011/3/31~2014/3/31 2011/8/12~2014/8/12 2011/11/30~2026/11/30 2012/6/28~2015/6/28 2012/9/21~2015/9/20
December 31, 2012 $ 11,761,200
Limit (USD405 million) (USD225 million) (EUR145 million) (JPY51 billion) (NTD2.5 billion) (NTD2.5 billion) (JPY11 billion) (USD50 million)
6,534,000 5,581,050 17,156,400
2,000,000 763,000 3,742,703 1,464,804 49,003,157 ( 18,295,200) $ 30,707,957 0.638%~1.6803% $
1) 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 US$ 1,035 million, of which US$ 405 million had been repaid in advance. As of December 31, 2012, the credit line is US$ 630 million, and the Company is the guarantor of the loan. 2) Part of the syndicated loan with Mizuho Corporate Bank Ltd. as the lead bank, amounting to US$630 million, had been reclassified to current liabilities in the third quarter of 2012. 3) Foxconn Slovakia, SPOL. S R.O., a subsidiary of the Company, entered into a syndicated credit facility agreement with ING Bank N.V. etc. as the lead bank and obtained a credit line in the amount of EUR 410 million, of which EUR 265 million had been repaid in advance in the fourth quarter of 2011. Starting from the fourth quarter in 2011, the credit line amounted to EUR 145 million, and the Company is the guarantor of the loan. 4) Throughout the term of Mizuho Corporate Bank Ltd., China Development Industrial Bank, First Commercial Bank, etc. syndicated term loan agreement, the Group shall maintain the agreed financial ratios, to be tested semi-annually and annually on an audited consolidated basis. (18) Retirement plan 1) The Company participates in a defined benefit pension plan in accordance with the Labor Standards Law, covering all regular employees for services provided prior to July 1, 2005, and employees who choose to remain in the defined benefit pension plan subsequent to the enforcement of the Labor Pension Act on July 1, 2005. The Company contributes on a monthly basis an amount equal to 2.1%
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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. A. In 2011 and 2012, the related actuarial assumptions used to calculate the pension liability were as follows: 2011 2012 Discount rate 1.90% 1.75% Rate of increase in compensation 3.00% 3.00% Expected return rate on plan assets 1.90% 1.75% B. Funded status of the pension plan December 31, 2011 Benefit obligation: Vested benefit obligation Non-vested benefit obligation Accumulated benefit obligation Additional benefits based on future salary increases Projected benefit obligation Fair value of plan assets Funded status Unrecognized net transition obligation Unrecognized actuarial loss Accrued pension liability Vested benefit ($ ( ( ( ( ( 274,377) 1,081,451) 1,355,828) 552,906) 1,908,734) 621,909 1,286,825) 2,735 412,748 871,342) 302,126 ($ ( ( ( ( ( 2012 359,171) 1,154,451) 1,513,622) 592,195) 2,105,817) 645,316 1,460,501) 222 ($ $ 559,591 900,688) 392,289
($ $
C. In 2011 and 2012, the details of net pension cost were as follows: 2011 2012 Service cost $ 36,377 $ 33,119 Interest cost 29,126 36,266 Expected return on plan assets ( 10,530) ( 11,816) Amortization of unrecognized net transition obligation 2,513 2,513 Amortization of unrecognized actuarial loss 2,314 15,848 Net periodic pension cost $ 59,800 $ 75,930 2) Effective July 1, 2005, in accordance with the Labor Pension Act, the Company has a defined contribution employee retirement plan covering all domestic employees. The Company contributes monthly an amount based on 6% of employees monthly salaries and wages to the employees personal pension accounts with the Bureau of Labor Insurance. Employees may choose to receive pension on a monthly basis or as lump sum payment upon retirement wherein the amount of
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benefits is the account balance plus accumulated investment gains. The pension expenses under this plan amounted to $301,182 and $305,101 for the years ended December 31, 2011 and 2012, respectively. 3) 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 and the subsidiaries do not have further pension liabilities. 4) As of December 31, 2011 and 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 $192,958 and $202,707, respectively. Pension expenses in the amount of $7,959,174 and $15,269,556 were recognized for the years ended December 31, 2011 and 2012, respectively. (19) Capital stock 1) As of December 31, 2012, the Companys authorized shares were 12,230,000 thousand shares (including 200 million shares reserved for employee stock options or convertible bonds) and the issued and outstanding common stock were 11,835,867 thousand shares with a par value of $10 (in dollars) per share. 2) On June 18, 2012, the Companys shareholders adopted a resolution to increase the authorized shares to 15 billion shares and approved employees stock bonus amounting to $5,874,552 for 2011. The employee stock bonus of 77,860 thousand shares was determined based on the closing price of $75.45 (in dollars) on June 15, 2012, the previous day of the 2012 shareholders meeting after taking into account the effects of ex-rights and ex-dividends. In addition, the Companys shareholders adopted a resolution to issue stock dividends at par value amounting to $10,689,097. 3) 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 Companys 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. 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.
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C. Dividends GDR holders are entitled to receive dividends to the same extent as the holders of common stock subject to the terms of the Deposit Agreement and applicable laws of the R.O.C. D. As of December 31, 2012, 157,010,000 units of GDRs were outstanding, which represents 314,019 thousand shares of common stock. (20) Share-based payment - employee compensation plan As of December 31, 2011 and 2012, the share-based payment transactions of Foxconn International Holdings Limited, a subsidiary of the Company (listed on the Stock Exchange of Hong Kong), are set forth below: Quantity Contract Vesting conditions/ Type of arrangement Grant date granted period Restricted terms Employee stock options September 12, 2007 2,400,000 1 ~ 6 years Note (1) July 8, 2011 256,159,719 1 ~ 3 years Share appreciation rights January 1, 2006 7,343,564 1 ~ 3 years Other share-based December 29, 2006 5,748,145 Note (2) payment plans July 24, 2007 502,090 Note (3) December 28, 2007 20,459,322 Note (4) October 29, 2009 26,161,489 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) December 28, 2012 135,564,990 Note (6) 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.
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1) 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 weighted-average parameters used in the estimation of the fair value are as follows: Stock Exercise Expected Expected Risk-free price price price dividend interest Fair value per Grant date (HK$) (HK$) volatility yield rate rate share (US$) September 12, 2007(A) 19.46 20.63 36% 3.92% 0.86 July 8, 2011 3.62 3.62 37% 0.297%~ 0.11 0.667% For the years ended December 31, 2011 and 2012, the weighted-average exercise price of employee stock options outstanding were US$0 and US$0.7 (in dollars) per share, respectively, and expenses incurred on employee stock options transactions were $404,788 (US$13,773 thousand) and $245,461 (US$8,301 thousand), respectively. Details of the employee stock options are set forth below: For the years ended December 31, Employee Stock Options (In shares) 2011 2012 Options outstanding at beginning of year 227,459,105 253,061,762 Options granted 256,159,719 Options exercised - ( 29,548,295) Options revoked ( 230,105,486) ( 17,138,833) Options canceled ( 451,576) Options outstanding at end of year 253,061,762 206,374,634 Options exercisable at end of year 1,600,000 51,323,616 2) Share appreciation rights There is no stock appreciation rights outstanding as of December 31, 2011 and 2012. 3) Other share-based payment plans These share-based payments were granted to employees. For the years ended December 31, 2011 and 2012, expenses incurred on other share-based payments were $1,434,996 (US$48,826 thousand) and $1,946,238 (US$65,818 thousand), respectively. (21) Capital reserve 1) Pursuant to the R.O.C. Company Law, 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
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legal reserve is insufficient. 2) Please see Note 4 (16) for information on Capital reserve from conversion right. (22) Retained earnings 1) In accordance with the Companys Articles of Incorporation, current years earnings must be distributed in the following order: A. Covering accumulated deficit; B. Setting aside as legal reserve equal to 10% of current years 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 Companys dividend policy. The Companys dividend policy requires the board of directors to consider the Companys 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 share dividends distributed in respect of any fiscal year shall not exceed 90 percent of total dividends to stockholders. 2) 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 Companys paid-in capital. 3) The details of the undistributed earnings were as follows: December 31, 2011 2012 Before new tax system was adopted $ 2,163,509 $ 2,163,509 After new tax system was adopted Subjected to additional 10% corporate income tax 241,745,894 288,455,052 Not subjected to additional 10% corporate income tax 81,590,999 94,762,377 $ 325,500,402 $ 385,380,938
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4) The details of imputation system were as follows: December 31, Balance of stockholders deductible tax account $ 2011 36,036,198 $ 2012 42,643,997
2011 (Actual) 2012 (Estimated) Tax deductible rate of earnings distribution 14.07% 13.43% 5) The appropriations of 2010 and 2011 earnings had been resolved at the stockholders meeting on June 8, 2011 and June 18, 2012, respectively. Details are summarized below: 2010 2011 Dividends per Dividends per share share Amount (in dollars) Amount (in dollars) Legal reserve $ 7,715,455 $ $ 8,159,100 $ Stock dividends 9,661,248 1.0 10,689,096 1.0 Cash dividends 9,661,248 1.0 16,033,645 1.5 $ 27,037,951 $ 2.0 $ 34,881,841 $ 2.5 As of March 25, 2013, the distribution of 2012 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. 6) The estimated amounts of employees bonus and directors and supervisors remuneration are $5,874,552 and $0 for 2011, and $6,822,891 and $0 for 2012, respectively, based on a certain percentage (8% and 0%) 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. The employee stock bonus amounting to $5,874,552 for 77,860 thousand shares were determined based on the closing price of the Companys common stock, $75.45 (in dollars), on June 18, 2012, the previous day of the 2012 shareholders meeting after taking into account the effects of ex-rights and ex-dividends.
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(23) Earnings per common share For the year ended December 31, 2011 Earnings per Number of common share Amount (in dollars) shares (in Before tax After tax thousands) Before tax After tax Basic earnings per share: Consolidated net income $102,536,200 $81,934,633 Minority interest ( 822,095) ( 343,634) Net income attributable to equity holders of the $101,714,105 $81,590,999 Company Diluted earnings per share: Consolidated net income $102,536,200 $81,934,633 Minority interest ( 822,095) ( 343,634) Dilutive effect of stock equivalents: Convertible bonds-overseas 645,094 535,428 Employees bonus-2011 Net income attributable to equity holders of the $102,359,199 $82,126,427 Company 11,756,704 $ 8.72 ( 0.07) $ 8.65 $ 8.46 0.07) 0.06 $ 8.45 $ 6.97 ( 0.03) $ 6.94 $ 6.76 ( 0.03) 0.05 $ 6.78
( 280,047 77,949 12,114,700
For the year ended December 31, 2012 Earnings per Number of common share Amount (in dollars) shares (in Before tax After tax thousands) Before tax After tax Basic earnings per share: Consolidated net income Minority interest Net income attributable to equity holders of the Company Diluted earnings per share: Consolidated net income Minority interest Dilutive effect of stock equivalents: Convertible bonds-overseas Employees bonus-2012 Net income attributable to equity holders of the Company $118,379,091 3,104,865 $121,483,956 $118,379,091 3,104,865 666,334 $122,150,290 $91,787,141 2,975,236 $94,762,377 $91,787,141 2,975,236 553,057 $95,315,434 280,047 84,423 12,162,983 11,798,513 $ 10.03 0.27 $ 10.30 $ 9.73 0.26 0.05 $ 10.04 $ 7.78 0.25 $ 8.03 $ 7.55 0.24 0.05 $ 7.84
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1) The number of shares had retroactively been adjusted by the stock dividends as of December 31, 2012. 2) Effective January 1, 2008, as employees bonus could be distributed in the form of stock, the diluted EPS computation shall assume that distribution will be in the form of stocks in the calculation of the weighted-average number of common shares outstanding during the reporting year, taking into account the dilutive effects of stock bonus on potential common shares; whereas, the basic EPS shall be calculated based on the weighted-average number of common shares outstanding during the reporting year, which shall include the shares of employees stock bonus from the appropriation of prior year earnings, which have already been resolved at the stockholders meeting held in the reporting year. (24) Personnel, depreciation and amortization expenses For the years ended December 31, 2011 2012 Cost of sales Personnel expenses Salaries Labor and health insurances Pension Others Depreciation Amortization Operating expenses Personnel expenses Salaries Labor and health insurances Pension Others Depreciation Amortization
$ $ $
110,968,317 5,386,897 6,207,278 2,198,788 124,761,280 35,896,812 3,240,287
$ $ $
170,937,676 8,054,777 12,738,742 8,663,199 200,394,394 47,362,616 3,995,479
$ $ $
50,821,014 2,443,243 2,112,878 1,006,995 56,384,130 9,764,585 2,554,057
$ $ $
57,660,705 3,648,094 2,911,845 4,627,149 68,847,793 10,798,926 5,726,306
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5. RELATED PARTY TRANSACTIONS 1) Names of related parties and their relationship with the Company Names of related parties Relationship with the Company Foxconn Technology Co., Ltd. and subsidiaries Investee company accounted for under the equity (FTCS) method Pan International Industrial Corporation and " subsidiaries (PIICS) Zhen Ding Technology Holding Limited An indirectly-owned investee company accounted (ZDT-Cayman) for under the equity method Foxsemicon Integrated Technology, Inc. and " subsidiaries (FITIS) CyberTAN Technology, Inc. and subsidiaries " (CyberTANS) The Companys chairman is the major Innolux Corporation and subsidiaries (Formerly Chimei Innolux Corporation) (Innoluxs) shareholder " SIO International Holdings Limited and subsidiaries (SIOS) Subsidiary of the Company Foxconn (Far East) Limited Indirect investment subsidiary of the Company Foxconn Slovakia, SPOL. S R.O. " Hongfujin Precision Electronics (Chengdu) Limited (Hongfujin (Chengdu)) " Competition Team Technologies Ltd. (Competition Team) " Competition Team Ireland Ltd. (Competition Ireland) All the transactions with subsidiaries disclosed below had been eliminated when preparing consolidated financial statements. Except for transactions with the above related parties, there were no other material transactions between related parties and the Company for the years ended December 31, 2011 and 2012. Information on transactions with subsidiaries is disclosed in Note 11. 2) Significant transactions and balances with related parties A. Sales For the years ended December 31, 2011 % 2012 % FTCS $ 83,882,312 2 $ 87,221,471 2 1 1 Innoluxs 18,552,703 15,230,714 SIOS 9,783,784 CyberTAN 6,757,308 3,382,280 Others 1,837,644 2,515,312 $ 111,029,967 $ 118,133,561 3 3
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(1) The sales prices and credit terms to related parties were not significantly different from sales to 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. The credit term is disclosed in Note 11(1) 7). (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. B. Purchases For the years ended December 31, 2011 % 2012 % 1 $ 35,752,218 1 FTCS $ 36,978,255 1 1 ZDT-Cayman 27,340,972 34,202,749 1 1 Innoluxs 16,890,277 27,072,913 PIICS 5,748,369 11,718,497 Others 3,478,012 4,746,415 $ 90,435,885 3 $ 113,492,792 3 The purchase prices and payment terms to related parties were not significantly different from purchases from 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. The payment terms to third parties are between 30 to 90 days. C. Accounts receivable - related parties December 31, 2011 % 2012 % 3 $ 20,953,928 3 FTCS $ 15,187,492 2 SIOS 8,938,992 2 1 Innoluxs 7,183,713 3,579,516 Others 2,920,606 1,997,215 $ 25,291,811 5 $ 35,469,651 6 D. Prepayment December 31, 2011 2012 $ 44,225 $ 44,225 Others E. Other receivables The Group purchased materials on behalf of Innoluxs and FTCS, etc. As of December 31, 2011 and 2012, other receivables amounted to $1,565,834 and $1,891,534, respectively.
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F. Accounts payable - related parties December 31, 2011 % 2012 % FTCS $ 15,986,100 18,228,693 3 $ 3 ZDT-Cayman 6,424,374 8,479,854 1 1 Innoluxs 3,046,793 4,029,040 1 1 PIICS 1,917,629 4,009,801 1 Others 1,394,281 867,459 $ 28,769,177 5 $ 35,614,847 6 As of December 31, 2011 and 2012, a portion of accounts payable to FTCS in the amount of $3,453,063 and $2,962,332, respectively, pertains to purchases of materials made by FTCS on behalf of the Group. G. Property transactions For the year ended December 31, 2011 Sales / Gain Receivables/(payables) Transaction purchase price on disposal Counterparty at December 31, 2011 FTCS, Innoluxs, ZDT- Sale of fixed $ 808,617 $ 2,043 $ 312,527 Cayman, PIICS assets FTCS, Innoluxs, Cyber Acquisition TANS, PIICS, FITIS of fixed and ZDT-Cayman assets 389,431 ( 93,543)
For the year ended December 31, 2012 Sales / Gain Transaction purchase price on disposal Counterparty FTCS, Innoluxs, ZDT- Sale of fixed $ 669,105 $ 11,615 Cayman, PIICS assets FTCS, Innoluxs, ZDT- Acquisition Cayman, PIICS and of fixed FITIS assets Innoluxs Acquisition of interest 2,128,458 -
Receivables/(payables) at December 31, 2012 $ 304,796 ( 161,827)
115,404
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H. Guarantees Endorsements and guarantees provided for the related parties as of December 31, 2011 and 2012 are as follows: Foxconn (Far East) Limited $ (USD $ (EUR $ $ December 31, 2011 25,879,995 855 million) 20,603,999 526 million) I. Salaries/rewards information of key management: For the years ended December 31, 2011 2012 166,889 $ 120,805 960 1,729 362,242 132,255 662,346 356,087 33,887 512,508 December 31, 2012 $ 53,884,030 (USD 1,330 million and JPY 45 billion) $ 15,207,905 (EUR 396 million) $ 2,904,100 (USD 100 million) $ 27,248,800 (USD 700 million and RMB 1.5 billion) $ 5,182,150 (USD 50 million and JPY 11 billion)
Foxconn Slovakia SPOL. S R.O. Competition Ireland Competition Team
Hongfujin (Chengdu)
Salaries and bonuses Service execution fees Employees bonuses Share-based payment expenses Total
(A) Salaries and bonuses include regular wages, special responsibility allowances, pensions, various bonuses and rewards, etc. (B) Service execution fees include travel or transportation allowances, special expenditures, various allowances, housing and vehicles offering, etc. (C) Employees bonuses were those amounts estimated and accrued in the statement of income for the current year. (D) Share-based payment expenses were the compensation costs accounted for under R.O.C SFAS No. 39. (E) The relevant information above is shown in the Companys annual report.
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6. PLEDGED ASSETS As of December 31, 2011 and 2012, the assets pledged as collateral were as follows: December 31, 2011 2012 Assets Nature Book value Book value Time deposits and cash Short-term loans $ 46,741,750 $ 947,222 (shown as other financial assets - current) Time deposits and cash Short-term loans, bond deposit as (shown as other security for court proceedings, security financial assets deposit for employment of foreign non-current) employees and customs deposits 24,179 854,748 $ 46,765,929 $ 1,801,970 7. COMMITMENTS AND CONTINGENT LIABILITIES 1) The Company entered into several contracts for the acquisition of machinery with total value of approximately $18,049 million. As of December 31, 2012, the unpaid balance on these contracts amounted to $4,204 million. 2) As of December 31, 2012, the Companys subsidiaries future minimum lease payments for factories and employees' dormitory were approximately $1,877 million as follows: Year Amount (in millions) 2013 $ 538 2014 449 2015 383 2016 251 2017 and thereafter 256 $ 1,877 3) 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. 4) 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. 8. SIGNIFICANT CATASTROPHE None. 9. SUBSEQUENT EVENTS 1) On January 7, 2013, following the approval from the SFB, the Company issued the 2012 1st domestic unsecured bonds in the amount of $11,150,000.
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2) On January 16, 2013, Hongfujin Precision Industrial (Shenzhen) Co., Ltd., a subsidiary of the Company, sold the shares of Interface Optoelectronics (Shenzhen) Co., Ltd. to Blooming Progress Limited in the amount of US$39,500 thousand. 3) The Companys subsidiary, Foxconn (Far East) Ltd., prices the unsecured corporate bonds (Bonds) guaranteed by the Company amounting to JPY 14 billion under the Medium -Term Note programme. The term of the Bonds is 3 years plus 1 day. There are two series of the Bonds, one is JPY 10 billion Bonds issued at a fixed rate of 1.28% and the other is JPY 4 billion Bonds issued at a floating rate of 3-month Libor plus 1.10%. 4) The Companys board of directors resolved on March 25, 2013 for a subsidiary of the Company to sell its 25% ownership in Mediamarkt (China) International Retail Holding Ltd. (Mediamarkt) including Mediamarkts two subsidiaries in China namely, MediaMarkt (Shanghai) Consulting Service Company Limited and MediaMarkt (Shanghai) Commercial & Trading Company Limited, to Media Saturn China-Holding Limited in the amount of US$17,500 thousand. 10. OTHERS 1) Fair value of financial instruments December 31, 2011 Fair value Quotation Estimated using in an active a valuation Non-derivative financial instruments Book value market technique Note Assets: Financial assets with fair values equal $ 887,265,074 $ $887,265,074 A to book values Open-end funds 24,412 24,412 B Available-for-sale financial assets 5,464,606 5,464,606 C Financial assets carried at cost - non4,046,796 4,046,796 D current Refundable deposits 1,323,105 1,316,389 E Liabilities: Financial liabilities with fair values 971,524,706 971,524,706 A equal to book values Long-term bonds payable 62,378,777 60,894,339 F Derivative financial instruments Assets: Forward exchange contracts Liabilities: Forward exchange contracts
45,917 251,834
45,917 251,834
G G
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Book value Off-balance sheet financial instruments Guarantees-USD $ 25,879,995 (US$ 855,000 thousand) Guarantees-EUR 20,603,999 (EUR$ 526,000 thousand)
December 31, 2011 Fair value Quotation Estimated using in an active a valuation market technique $ $ 25,879,995 (US$ 855,000 thousand) 20,603,999 (EUR$ 526,000 thousand) December 31, 2012 Fair value Quotation Estimated using in an active a valuation market technique $ 83,265 9,080,263 $1,177,758,794 8,620,722 867,760 1,230,780,334 69,980,009
Note H
Non-derivative financial instruments
Book value
Note A B C D E A F
Assets: Financial assets with fair values equal $1,177,758,794 to book values Open-end funds 83,265 Available-for-sale financial assets 9,080,263 Financial assets carried at cost - non8,620,722 current Refundable deposits 879,643 Liabilities: Financial liabilities with fair values 1,230,780,334 equal to book values Long-term bonds payable 74,980,461 Derivative financial instruments Assets: Forward exchange contracts Financial assets at fair value through profit or loss Corporation bonds Liabilities: Forward exchange contracts
56,955
56,955
179,300 66,767
179,300 66,767
G G
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December 31, 2012 Fair value Quotation Estimated using in an active a valuation Off-balance sheet financial Book value market technique instruments Note Guarantees-USD $ 60,309,380 $ $ 63,309,380 H (US$ 2,180,000 (US$ 2,180,000 thousand) thousand) Guarantees-EUR 15,207,905 15,207,905 H (EUR$ 396,000 (EUR$ 396,000 thousand) thousand) Guarantees-JPY 18,989,600 18,989,600 H (JPY$56,000,000 (JPY$56,000,000 thousand) thousand) Guarantees-RMB 6,920,100 6,920,100 H (RMB1,500,000 (RMB1,500,000 thousand) thousand) The methods and assumptions used to estimate the fair values of the above financial instruments are summarized below: A. For short-term instruments, the fair values were determined based on their carrying values because of the short maturities of the instruments. This method was applied to cash and cash equivalents, notes and accounts receivable, other receivables, short-term loans, notes and accounts payable, accrued expenses, current portion of long-term liabilities, other payables and other current liabilities. B. For Open-ended funds, the fair values were determined based on the funds net assets at December 31, 2011 and 2012. C. Available-for-sale financial assets are regarded as quoted in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker industry group, pricing service or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arms-length basis. If the market for a financial instrument is not active, the fair values are determined using a valuation technique. The fair values of available -for-sale financial assets are based on the quotation in the active markets as of December 31, 2011 and 2012. D. As financial assets carried at cost are not quoted in an active market and their fair value cannot be measured reliably, they are measured at cost. E. The fair value of refundable deposits is based on the present value of expected future cash flows, and the discount rate is based on the fixed rate of the one year time deposit given by the Post Office as of December 31, 2011 and 2012. F. The fair value of convertible bonds issued after January 1, 2006 is based on the present value of expected cash flows amount. The discount rate is the effective interest rate of convertible bonds in the current market, whose contractual terms are similar to those of convertible bonds issued by the
143
Company. G. The fair values of derivative financial instruments which include unrealized gain or loss on unsettled contracts were determined based on the amounts to be received or paid assuming that the contracts were settled as of the reporting date. H. The fair value of guarantees was based on the contract amounts. 2) Financial instruments with off-balance sheet credit risk Please see Note 5. 2) H. 3) Financial risk control A. 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, credit risk, liquidity risk, and cash flow risk. Except for market risk, which is controlled by outside factors, the remainder of the foregoing types of risk can be controlled internally or removed from business processes. Therefore, the goal in managing each of these risks is to reduce them to zero. As for market risk, the goal is to optimize its overall position through strict 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. B. The risk management and control system of the Group is administered within a framework of stratified responsibility: (1) The board of directors formulates and approves the procedures; the senior officers designated by the board make regular and unscheduled assessments of management procedures, organizational structure, transaction flows, and whether there are any abnormal circumstances; (2) The legal department reviews and examines transaction agreements; (3) The finance department makes suggestions with regard to transactions and is responsible for carrying them out; (4) The accounting department manages the accounts; (5) The audit department undertakes audits. Under this framework, with its strict adherence to proper segregation of duties and adequate internal control procedures, the Group seeks to minimize the potential adverse effects on the Groups financial performance. 4) Material financial risk information A. Market risk (1) Foreign exchange risk: The Groups major purchase and sale transactions are conducted in USD. The fair value changes along with the foreign exchange rate fluctuations. However, the amounts and periods of the Groups accounts receivable and accounts payable are roughly equivalent, so the market risk could mostly be offset. When temporary gap rises, the Group would enter into the forward
144
contract to hedge the risk. Accordingly, the Group expects no material risk as a whole. (2) Futures market risk: The Group is exposed to price risk because of investments in futures market instruments, which have fair value in the active market. The Group sets limits to control the transaction volume and the stop-loss amount of derivatives to reduce its futures market risk. As a result, there is no significant future market risk. (3) Interest rate risk: The long-term bonds issued by the Group all have fixed interest rates, so there is no interest rate risk. (4) Stock price risk: A. Issued by the Company: The overseas convertible bonds issued by the Company are compound instruments, which include the conversion rights, call option, and put option. Except that the fair value of the bonds would be changed due to changes in market interest rate, their fair value is mainly subject to the changes in the Companys stock price. The Company could exercise the call option to mitigate the stock price risk adequately. B. Held by the Company: Though price of available-for-sale financial assets and financial assets carried at cost held by the Company fluctuates with the effects of market, it will not affect operating income but stockholders equity of current year. Accordingly, the Company expects no material risk as a whole. (5) Certain transactions of the Group involve non-functional currencies which are exposed to exchange rate fluctuations. The information on foreign currency denominated monetary assets and liabilities which are significantly affected by exchange rate fluctuation is as follows: (Foreign Currency: Functional Currency) December 31, 2011 2012 Foreign currency Foreign currency amount Exchange amount Exchange (In thousands) rate (In thousands) rate Financial Assets Monetary item $ 16,044,545 30.28 $ 16,638,351 29.04 USD : NTD 4,118,073 6.2933 8,337,943 6.2305 USD : RMB 4,065,821 0.0390 4,085,757 0.0398 CZK : EUR Net effect in consolidated entities with foreign currency USD : NTD 16,132,709 30.28 19,012,423 29.04 EUR : NTD 215,299 39.18 258,270 38.49
145
December 31, 2011 Foreign currency amount Exchange (In thousands) rate 2012 Foreign currency amount Exchange (In thousands) rate
Financial Liabilities Monetary item $ 11,775,142 6.2933 $ 16,937,054 6.2305 USD : RMB 11,235,440 30.28 12,226,807 29.04 USD : NTD 74,763,422 0.3906 64,256,794 0.3364 JPY : NTD 23,475,230 0.0812 53,075,694 0.0722 JPY : RMB B. Credit risk (1) Receivables: With respect to receivables of the Group, most of the debtors are well-known international companies with very good credit standing and have no history of significant default. Moreover, the adequacy of the allowance for doubtful accounts is assessed regularly, so there is no material credit risk. (2) Financial market: i. The forward and futures transactions entered into by the Group are done with financial institutions with very good credit standing. The Group does not expect these financial institutions to default. Consequently, the likelihood that the credit risk would occur is low. ii. Convertible bonds payable of the Company were issued in the primary market, so that the Company is not exposed to credit risk that may arise from counterparties in the secondary market. (3) Asset transactions: The Group has investments in available-for-sale financial assets and financial assets that are measured at cost. Although the potential for credit risk does exist, there is an active market for available-for-sale financial assets, and for financial assets measured at cost, the Group performs impairment testing regularly. Moreover, the Group evaluated the counterparties credit standing when it entered into the transaction. Although the potential for credit risk does exist, the Group does not expect material credit risk accordingly. C. Liquidity risk (1) Foreign exchange transactions: For forward foreign exchange transactions entered into by the Group, the targets of the transactions are all currencies traded in international foreign exchange markets with high trading volumes and a large number of traders bidding. Trading is active with high liquidity. Therefore, no material liquidity risk is expected.
146
(2) Futures transactions: For futures transactions entered into by the Group, orders are placed on future exchanges in New York, Chicago or London. The numbers of available future targets and international market participants are adequate to facilitate easy entry and exit. Therefore, no material liquidity risk is expected. (3) Working capital: The Group has good operating and credit conditions as well as sufficient working capital, so it expects no significant liquidity risk arising from insufficient capital to meet contract obligations. (4) Convertible bonds: (a)Overseas convertible bonds payable The Company issued overseas convertible bonds in the amount of US$1 billion on October 12, 2010. The bonds will mature on October 12, 2013. The bondholders have no put options in the bonds. The Company expects no significant liquidity risk. D. Cash flow risk from movements of interest rates (1) Long-term liabilities: i. For the domestic bonds payable issued by the Company, there should be no cash flow risk from movements of interest rates due to the fixed interest rate on the bond. ii. As to the overseas bonds payable issued by the Company, there should be no material cash flow risk from movements of interest rates due to the zero interest rate on the bond. iii. Although the Companys long-term loans bear short-term-floating-interest rate, current short-term interest rate is much lower than long-term interest rate and is not possible to rise significantly in the near future; thus, the Company expects no significant cash flow risk would arise. (2) Foreign exchange transactions: The forward foreign currency transactions entered into by the Group are for the purpose of hedging against short-term gaps of the net positions of foreign currency assets and liabilities. As such, the amounts of the transactions are immaterial and their duration is short. Moreover, because of the equivalent foreign currency cash outflows and inflows, the Group expects no significant funding demand. Therefore, no material cash flow risk is expected from movements of interest rates. (3) Financial assets: As the investments in available-for-sale financial assets, financial assets that are measured at cost and futures transactions of the Group are not interest-rate type products, there is no cash flow risk from movements in interest rates.
147
5) Elimination of intercompany transactions For the year ended December 31, 2011 Transactions Companies 1) Elimination of longHyield Venture Capital Co., Ltd. term investments Foxconn Holding Ltd. and stockholders' Foxconn (Far East) Limited equity Bao Shin International Investment Co., Ltd. Hon Chi International Investment Co., Ltd. Hon Yuan International Investment Co., Ltd. Lin Yih International Investment Co., Ltd. Premier Image Technology (H.K), Limited Hon Hai/Foxconn Logistics California LLC. Hon Hai/Foxconn Logistics Texas LLC. Altus Technology Inc. Foxconn Singapore (PTE) Ltd. Ambit International Ltd. Margini Holdings Ltd. Image & Vision Investment Corp. Foxconn Holdings B.V. -Netherland Syntrend Creative Park Co., Ltd. Foxconn SA B.V. 2) Elimination of intercompany receivables, payables and prepayments A. Accounts Foxconn Holding Ltd. receivable, Foxconn (Far East) Limited accounts payable Bao Shin International Investment Co., Ltd. and other Hyield Venture Capital Co., Ltd. receivables/ Hon Hai/Foxconn Logistics California LLC. payables Hon Hai/Foxconn Logistics Texas LLC. Foxconn Singapore (PTE) Ltd. Ambit International Ltd. Margini Holdings Ltd. Premier Image Technology (H.K), Limited B. Prepayments Foxconn (Far East) Limited Foxconn Holding Ltd. 3) Elimination of profit and loss A. Sales and purchases Foxconn (Far East) Limited Foxconn Holding Ltd. Foxconn Singapore (PTE) Ltd. Hyield Venture Capital Co., Ltd. Bao Shin International Investment Co., Ltd. Ambit International Ltd. Hon Chi International Investment Co., Ltd.
Amount 524,911,375
981,727,616
567,821
1,908,437,423
148
Transactions
B. Logistics expenses C. Processing revenue and expenses D. Unrealized intercompany gross profit
For the year ended December 31, 2011 Companies Altus Technology Inc. Premier Image Technology (H.K), Limited Margini Holdings Ltd. Foxconn (Far East) Limited Hon Hai/Foxconn Logistics California LLC. Hon Hai/Foxconn Logistics Texas LLC. Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn Holding Ltd. Ambit International Ltd. Premier Image Technology (H.K), Limited Margini Holdings Ltd. For the year ended December 31, 2012 Companies Hyield Venture Capital Co., Ltd. Foxconn Holding Ltd. Foxconn (Far East) Limited Bao Shin International Investment Co., Ltd. Hon Chi International Investment Co., Ltd. Hon Yuan International Investment Co., Ltd. Lin Yih International Investment Co., Ltd. Premier Image Technology (H.K), Limited Hon Hai/Foxconn Logistics California LLC. Hon Hai/Foxconn Logistics Texas LLC. Altus Technology Inc. Foxconn Singapore (PTE) Ltd. Ambit International Ltd. Margini Holdings Ltd. Image & Vision Investment Corp. Foxconn Holdings B.V. -Netherland Syntrend Creative Park Co., Ltd. Foxconn SA B.V.
Amount
1,348,758
99,152,222 2,649,176
Transactions 1) Elimination of longterm investments and stockholders' equity
Amount 592,749,679
2) Elimination of intercompany receivables, payables and prepayments
149
Transactions A. Accounts receivable, accounts payable and other receivables/ payables
B. Prepayments 3) Elimination of profit and loss A. Sales and purchases
For the year ended December 31, 2012 Companies Foxconn Holding Ltd. Foxconn (Far East) Limited Bao Shin International Investment Co., Ltd. Hyield Venture Capital Co., Ltd. Hon Hai/Foxconn Logistics California LLC. Hon Hai/Foxconn Logistics Texas LLC. Foxconn Singapore (PTE) Ltd. Ambit International Ltd. Margini Holdings Ltd. Premier Image Technology (H.K), Limited Foxconn (Far East) Limited Foxconn Holding Ltd.
Amount $ 1,131,719,356
492,962
B. Logistics expenses
C. Processing revenue and expenses D. Unrealized intercompany gross profit
Foxconn (Far East) Limited Foxconn Holding Ltd. Foxconn Singapore (PTE) Ltd. Hyield Venture Capital Co., Ltd. Bao Shin International Investment Co., Ltd. Ambit International Ltd. Hon Chi International Investment Co., Ltd. Altus Technology Inc. Premier Image Technology (H.K), Limited Margini Holdings Ltd. Foxconn (Far East) Limited Hon Hai/Foxconn Logistics California LLC. Hon Hai/Foxconn Logistics Texas LLC. Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn Holding Ltd. Ambit International Ltd. Premier Image Technology (H.K), Limited Margini Holdings Ltd.
2,389,418,255
1,426,388
99,216,499 2,426,897
150
11. ADDITIONAL DISCLOSURES REQUIRED BY THE SECURITIES AND FUTURE 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. 1) Loans to any company or person: None 2) Guarantee information: Parties being guaranteed Highest Outstanding Ratio of Limit of outstanding guarantee Amount of accumulated guarantee Name of the company Relationship with guarantee guarantee amount at guarantee with amount to net assets Number providing guarantee Name the Company for such party amount 2012 12/31/2012 collateral placed of the Company 0 Hon Hai Precision Foxconn (Far East) A wholly owned $ $ 56,051,950 $ 53,884,030 $ 8.33% Industry Co., Ltd. Limited subsidiary 0 0 Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Foxconn Slovakia, Spol. S R. O. An indirect whollyowned subsidiary 20,790,255 27,436,200 15,207,905 27,248,800 2.35% 4.21%
Ceiling of the outstanding guarantee to the respective party $ -
Note Note 1, 2, 3 Note 1, 2, 3 Note 1, 2, 3
Competition Team An indirect whollyTechnologies owned subsidiary Limited Honfujin Precision An indirect whollyElectronics owned subsidiary (Chengdu) Limited Competition Team An indirect whollyIreland Limited owned subsidiary
5,622,950
5,182,150
0.80%
Note 1, 2, 3
2,936,500
2,904,100
0.45%
Note 1, 2, 3
Note 1: The Companys total endorsements and guarantees to others should not be in excess of the Companys net assets. Note 2: The Companys endorsements and guarantees provided for a single party should not be in excess 50% of the Companys net assets. Note 3: The net assets referred above are based on the latest audited or reviewed financial statements. 3) Marketable securities held as of December 31, 2012: December 31, 2012 General ledger Name of investors Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Type and name of marketable securities (Note 1) Relationship with the Company accounts (Note 2) Common stock of Pan International Industrial Investee company accounted for under (1) Corporation the equity method Common stock of Foxconn Technology Co., Ltd. Investee company accounted for under (1) the equity method Common stock of Media Tek Inc. None (2) Common stock of Innolux Co., Ltd. (Formerly Chimei Innolux Corporation) The Companys chairman is the major shareholder (3) Number of shares 106,178,272 124,238,234 2,134,259 137,624,396 Book value $ 2,296,398 6,181,682 690,433 2,146,941 Percentage of ownership 21 10 2 Market value/ Net worth $ 2,111,036 6,117,447 690,433 2,146,941
Note 1: Marketable securities disclosed above include listed stocks and open-end funds only. For other situation, please see Notes 4 (3) (6) and (7).
151
Note 2: Code of general ledger accounts: (1) Long-term investments accounted for under the equity method (2) Available-for-sale financial assets-current (3) Available-for-sale financial assets-non current 4) Marketable securities acquired or sold during 2012 in excess of $100,000 or over 20% of the companys contributed capital: Beginning Balance Addition Type and name of the marketable General ledger securities account Counterparty Number of shares Amount Number of shares Amount Foxconn (Far Long-term A wholly 2,652,946,797 $ 63,748,370 729,997,990 $ 21,604,219 East) Limited investments owned accounted subsidiary for under the equity method Foxconn Holding Long-term A wholly 81,289,333 2,486,853 16,310,652 484,924 Ltd. investments owned accounted subsidiary for under the equity method Syntrend Creative Long-term A wholly 51,326,000 513,260 64,244,400 642,444 Park Co., Ltd. investments owned accounted subsidiary for under the equity method 5) Acquisition of real estate exceeding the amount of $100,000 or 20% of the Companys contributed capital: None. 6) Disposal of real estate exceeding the amount of $100,000 or 20% of the Companys contributed capital: None.
Disposal
Ending Balance
Number Selling Book of shares price value $ $ -
Gain (loss) on disposal $ -
Number of shares 3,382,944,787
Amount $ 85,352,589
97,599,985
2,971,777
115,570,400
1,155,704
7) Related party purchases or sales transactions exceeding the amount of $100,000 or 20% of the Companys contributed capital:
152
Transactions Percentage of total purchases, sales, or other Credit Amount related accounts terms $ 39,825,230 2 45-90 days 16,849,018 9,873,190 9,555,961 6,786,299 5,867,759 4,641,542 1 1 60 days 90 days 60 days 60 days 90 days 90 days 60 days 90 days 60 days
Descriptions of and reasons for difference in transaction terms compared to non-related party
Company Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd.
Counterparty Foxconn (Far East) Limited and subsidiaries Foxconn CZ S. R. O.
Relationship with the Company Wholly-owned subsidiary and its subsidiaries Indirect wholly owned subsidiary
Purchases/sales Sales Sales Sales Sales Sales Sales Sales
Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable/(payable) Percentage of total notes and accounts receivable/ payable Balance balance Note $ 36,362,495 7 Note 2 1,948,822 8,698,808 1,205,220 1,194,376 469,585 2 Note 2
Foxconn Singapore Pte. Ltd. Wholly-owned subsidiary SIO International Inc. Foxconn Slovakia, Spol. R. O. Foxconn Japan Co., Ltd. Wholly-owned subsidiary of SIO S Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary
Innolux Corporation Ltd. The Companys chairman is the (Formerly Chimei Innolux major shareholder Corporation) Ingrasys Technology Co., Ltd. Indirect wholly-owned subsidiary Ningbo Chi Mei Optoelectronics Ltd. Indirect wholly-owned subsidiary of Innolux
Sales Sales Sales
4,066,179 3,207,447 2,684,879
2,781,452 1,161,217 346,315
1 Note 2
CyberTAN Technology, Inc. An indirectly-owned investee company accounted for under the equity method Ingrasys Technology USA Inc. Ennoconn Corporation Foxconn Technology Co., Ltd. Foxteq Australia Pty Ltd. Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Investee company accounted for under the equity method Indirect wholly-owned subsidiary
Sales Sales Sales
1,829,057 1,491,504 1,279,685
70 days 60 days 60 days 60 days
Note 1 Note 1 Note 1 Note 1
Note 1 Note 1 Note 1 Note 1 $
377,683 1,154,671
Note 2
Sales
$ 1,258,130
276,616
153
Transactions Percentage of total purchases, sales, or other Amount related accounts 952,322 840,496 828,625 643,203 484,298 476,754 463,609 451,685 449,461 256,896 231,780 227,822 220,281 -
Company Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd.
Relationship Counterparty with the Company Foxconn Technology Pte. Ltd. Indirect wholly-owned Subsidiary of FTC Foxconn Rus, LLC Ambit Microsystem (Shanghai) Co., Ltd. Fukui Precision Component (Shenzhen) Co., Ltd. Nanhai Chi Mei Electronics Ltd. Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary of ZDT-Cayman Indirect wholly-owned subsidiary of Innolux
Purchases/sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales
Credit terms 90 days 45 days 60 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 60 days 60 days
Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable/(payable) Percentage of total notes and accounts receivable/ payable Balance balance Note 153,272 Note 2 109,162 653,432 155,977 145,779 1,963,023 134,812 120,720 48,485 12,200 240,184 1,227,814 Note 2 Note 2 Note 2 Note 2
Fuhong Precision Component Indirect wholly-owned (Bac Giang) Limited subsidiary Fenix Industria de Electronics Indirect wholly-owned Ltda. subsidiary Ningbo Chi Mei Electronics Indirect wholly-owned Ltd. subsidiary of Innolux Foxconn Global Services Division Nanhai Chi Mei Optoelectronics Corp. Fuhongkang Technology (Shenzhen) Co., Ltd. SIO International Holdings Limited Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary of Innolux Indirect wholly-owned subsidiary of CyberTAN The Companys chairman is the major shareholder
Funing Precision Component Indirect wholly-owned Co., Ltd. subsidiary
Pan-International Industrial Co.
Investee company accounted for under the equity method
Sales
215,464
90 days
Note 1
Note 1
43,126
154
Transactions Percentage of total purchases, sales, or other Amount related accounts 201,432 193,729 193,649 118,805 760,977,081 445,389,241 400,306,397 26 15 14
Company Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd.
Relationship Counterparty with the Company Purchases/sales Foxstar Technology Co., Ltd. Investee company accounted for Sales under the equity method Ability OPTO-Electronics Technology Co., Ltd. Cheng Uei Precision Industry Co., Ltd. Pan International Industrial Electronics (Malaysia) Best Leap Enterprises Limited Competition Team Technologies Limited Investee company accounted for under the equity method The chairman is a brother of the Companys chairman Indirect wholly-owned subsidiary of PIIC Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Sales Sales Sales Purchase Purchase Purchase
Credit terms 90 days 60 days 30~90 days 90 days 90 days 90 days 30~90 days 30~90 days 90 days 60 days 60 days 60 days 90 days
Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable/(payable) Percentage of total notes and accounts receivable/ payable Balance balance 84,631 50,578 30,458 15,589 ( 128,769,081) ( 101,807,174) ( 82,100,323) ( ( ( 24) 19) 15)
Note
Hongfujin Precision Indirect wholly-owned Electronics (Chengdu) Co., subsidiary Ltd. Foxconn (Far East) Limited and subsidiaries Wholly-owned subsidiary and its subsidiaries
Purchase Purchase Purchase Purchase Purchase
412,203,558 163,072,275 88,053,588 23,931,474 7,046,393
14 6 3 1 -
Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
( 91,657,738) ( 18,426,473) ( 3,997,441) ( 741,723)
( ( (
17) 3) 1) -
Note 3
Universal Field International Indirect wholly-owned Limited subsidiary Foxconn CZ S. R. O. AMB Logistics Ltd. Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary
Innolux Corporation Ltd. The Companys chairman is the (Formerly Chimei Innolux major shareholder Corporation) IRIS World Enterprises Indirect wholly-owned Limited subsidiary of ZDT-Cayman
( 1,023,640)
Purchase
$ 4,601,475
($
495,493)
155
Transactions Percentage of total purchases, sales, or other Credit Amount related accounts terms 3,954,048 30 days 2,623,306 1,277,782 90 days 75 days
Company Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd.
Counterparty NSG Technology, Inc. Fortune Source Enterprises Limited
Relationship with the Company Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary of PIIC
Purchases/sales Purchase Purchase Purchase
Unit price Note 1 Note 1 Note 1
Terms Note 1 Note 1 Note 1 ( (
Notes and accounts receivable/(payable) Percentage of total notes and accounts receivable/ payable Balance balance Note Note 4 964,788) 97,923) -
CyberTAN Technology, Inc. An indirectly-owned investee company accounted for under the equity method SIO International Inc. Ampower Technology Co., Ltd. FTC Technology Inc. Foxconn Technology Pte. Ltd. Foxstar Technology Co., Ltd. Tekcon Electronics Corp. FTP Technology Inc. Pan-International Industrial Co. Foxconn Global Services Division Wholly-owned subsidiary of SIO Indirectly-owned investee company accounted for under the equity method Indirect wholly-owned subsidiary of FTC Indirect wholly-owned subsidiary of FTC Investee company accounted for under the equity method Indirect wholly-owned subsidiary of PIIC Indirect wholly-owned subsidiary of FTC Investee company accounted for under the equity method Indirect wholly-owned subsidiary
Purchase Purchase
893,614 466,890
90 days 90 days
Note 1 Note 1
Note 1 Note 1
( (
306,390) 46,453)
Purchase Purchase Purchase Purchase Purchase Purchase Purchase
466,466 459,239 307,047 254,212 192,906 192,020 159,886
60 days 90 days 60 days 45 days 60 days 90 days 90 days
Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
( ( ( ( ( ( (
76,268) 89,434) 98,496) 61,893) 43,414) 68,249) 159,886)
Hon Hai Precision Industry Co., Ltd. Hon Hai Precision
Foxconn Technology Co., Ltd Heroic Legend Enterprises
Investee company accounted for under the equity method Indirect wholly-owned
Purchase Processing and
145,408 18,863,275
19
60 days -
Note 1 Note 1
Note 1 Note 1
($
21,495) (
17)
( 14,986,541)
156
Transactions Percentage of total purchases, sales, or other related accounts 25
Company Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Ltd.
Counterparty
Relationship with the Company subsidiary subsidiary
Purchases/sales molding costs Processing and molding costs Processing and molding costs Processing and molding costs Processing and molding costs Processing and molding costs Processing and molding costs
Amount 24,538,973
Credit terms -
Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable/(payable) Percentage of total notes and accounts receivable/ payable Balance balance ( 6,667,214) ( 8)
Note
(shown as accrued expenses) (shown as accrued expenses) 16,503,053 17 ( 14,846,695) ( 17) (shown as accrued expenses) 11,395,252 11 ( 435,798) ( 1) (shown as accrued expenses) 12,746,052 13 ( 21,732,987) ( 25) (shown as accrued expenses) 10,944,341 11 ( 1,878,416) ( 2) (shown as accrued expenses) 3,976,588 4 ( 25,330,425) ( 30) (shown as accrued expenses)
Success Rise Enterprises Ltd. Indirect wholly-owned Franklin Management Ltd. Best Leap Enterprises Ltd. Foxconn (Far East) Limited and subsidiaries Ltd. Carston Ltd.
Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Wholly-owned subsidiary and its subsidiaries subsidiary Indirect wholly-owned subsidiary
Beyond Maximum Industrial Indirect wholly-owned
Note 1: 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 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, 2012, the Companys prepayment was $79,379. Note 4: As of December 31, 2012, the Companys prepayment was $254,268.
8) Receivables from related parties exceeding the amount of $100,000 or 20% of the Companys contributed capital as of December 31, 2012: Overdue receivables
157
Company Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd.
Relationship with Counterparty the Company Foxconn (Far East) Limited and subsidiaries Wholly-owned subsidiary and its subsidiaries Foxconn (Far East) Limited and subsidiaries Wholly-owned subsidiary and its subsidiaries Futaihua Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Electronics (Zhengzhou) Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Universal Field International Limited SIO International Inc. Ingrasys Technology Co., Ltd. Fuhong Precision Component (Bac Giang) Limited Foxconn Singapore Pte. Ltd. Funing Precision Component Co. Ltd. Foxconn Slovakia, Spol. S R. O. Foxconn Japan Co., Ltd. Ningbo Chi Mei Optoelectronics Ltd. Foxconn Technology Co., Ltd. Interface Optoelectronics (Shenzhen) Co., Ltd. Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Wholly-owned subsidiary of SIO Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Wholly-owned subsidiary Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary Indirect wholly-owned subsidiary of Innolux Investee company accounted for under the equity method Investee company accounted for under the equity method
Balance of receivables from related parties $ 36,362,495 64,308,654
Turnover rate 3 -
Amount $1,629,427 7,971,583 364,233 8,761 1,268,344 431,814 2,767 162,051 348 346,121 -
Actions taken Subsequent Collection Subsequent Collection Subsequent Collection
Subsequent collection $15,091,777 16,237,347 44,303,256 15,440,237 47,464,031 7,241,857
Allowance for bad debt $ $ -
(Shown as other receivables) (Note) 122,051,631 (Shown as other receivables) (Note) 78,660,801 (Shown as other receivables) (Note) 69,893,800 (Shown as other receivables) (Note) 16,567,174 (Shown as other receivables) (Note) 25,448,382 (Shown as other receivables) (Note) 8,698,808 2 2,781,452 1,963,023 1,948,822 1,227,814 1,205,220 1,194,376 1,161,217 1,154,671 $ 871,651 3 3 4 4 6 5 3 2 6
Subsequent Collection
16,120,147 6,632,855
Subsequent Collection Subsequent Collection Subsequent Collection Subsequent Collection
74,424 920,561 1,619,362 754,598 822,578 997,170
Subsequent Collection Subsequent Collection Subsequent Collection
561,437 514,241 $ 737,243
1,414
158
Overdue receivables Company Counterparty Amount Actions taken 62,525 Subsequent Collection Hon Hai Precision Ambit Microsystem (Shanghai) Co., Ltd. Industry Co., Ltd. 469,585 2 Hon Hai Precision Innolux Corporation Ltd. The Companys chairman is the major (Formerly Chimei Innolux Corporation) Industry Co., Ltd. shareholder 377,683 6 760 Subsequent Collection Hon Hai Precision Ennoconn Corporation Indirect wholly-owned subsidiary Industry Co., Ltd. 346,315 5 695 Subsequent Collection Hon Hai Precision CyberTAN Technology Inc. An indirectly-owned investee company Industry Co., Ltd. accounted for under the equity method 300,386 4 Hon Hai Precision New Ocean Precision Component (Jiangxi) Indirect wholly-owned subsidiary of PIIC Industry Co., Ltd. Co., Ltd. 276,616 4 Hon Hai Precision Foxteq Australia Pty Ltd. Indirect wholly-owned subsidiary Industry Co., Ltd. 240,184 2 Hon Hai Precision SIO International Holdings Limited The Companys chairman is the major Industry Co., Ltd. shareholder 158,959 51,213 Subsequent Collection Hon Hai Precision Hon Fujin Precision Industry (Taiyuan) Co., Indirect wholly-owned subsidiary Industry Co., Ltd. Ltd. of FTC 155,977 5 Hon Hai Precision Fukui Precision Component (Shenzhen) Co., Indirect wholly-owned subsidiary Industry Co., Ltd. Ltd. of ZDT-Cayman 153,272 6 Hon Hai Precision Foxconn Technology Pte. Ltd. Indirect wholly-owned subsidiary Industry Co., Ltd. of FTC 145,779 4 132 Subsequent Collection Hon Hai Precision Nanhai Chi Mei Optoelectronics Ltd. Indirect wholly-owned subsidiary Industry Co., Ltd. of Innolux 134,812 4 2,472 Subsequent Collection Hon Hai Precision Fenix Industria de Electronics Ltda. Indirect wholly-owned subsidiary Industry Co., Ltd. 125,242 6 992 Subsequent Collection Hon Hai Precision New Ocean Precision Component (Ganzhou) Indirect wholly-owned subsidiary of PIIC Industry Co., Ltd. Co., Ltd. 120,720 4 Hon Hai Precision Ningbo Chi Mei Electronics Ltd. Indirect wholly-owned subsidiary Industry Co., Ltd. of Innolux 109,162 Indirect wholly-owned subsidiary Hon Hai Precision Foxconn Rus, LLC Industry Co., Ltd. Note: Receivables for payments made on behalf of others. 9) Information on derivative transactions: Please see Note 4(2). (2) Disclosure information of Investee Company (All the transactions with subsidiaries disclosed below had been eliminated when preparing consolidated financial statements. The disclosure information as follows is for reference only.) Relationship with the Company Indirect wholly-owned subsidiary Balance of receivables from related parties 653,432 Turnover rate 5 Subsequent Allowance for collection bad debt 482,673 409,060 381,054 275,770 102,972 197,910 100,989 70,531 82,936 82,401 122,794 76,112 109,162 -
159
1) Information on Investee Companies: Original investment amount Main operating December 31, December 31, Investee company Address Activities Currency 2012 Currency 2011 Foxconn (Far East) Cayman Investment holding NTD $85,352,589 NTD $63,748,370 Limited Islands Investment holding NTD 3,900,000 NTD Hyield Venture Capital Taiwan 3,900,000 Co., Ltd. Bao Shin International Taiwan Investment holding NTD 2,998,500 NTD 2,998,500 Investment Co., Ltd. British Investment holding NTD 8,904,952 NTD Margini Holdings 8,904,952 Virgin Limited Islands British Investment holding NTD 1,788,146 NTD Ambit International 1,788,146 Virgin Ltd. Islands NTD 6,486,934 NTD Foxconn Holding B.V.- Netherland Investment holding 6,486,934 Netherland Manufacture and NTD 481,782 NTD Foxconn Technology Taiwan 481,782 design of Co., Ltd. monitors Investment holding NTD 2,971,777 NTD Foxconn Holding Ltd. British 2,486,853 Virgin Islands Investment holding NTD 1,611,500 NTD Hon Yuan International Taiwan 1,611,500 Investment Co., Ltd. Investment holding NTD 1,500,500 NTD Hon Chi International Taiwan 1,500,500 Investment Co., Ltd. NTD 1,661,610 NTD Foxconn Singapore Singapore Investment holding 1,661,610 Pte. Ltd. NTD 3,185,683 NTD Foxconn SA B.V. Netherland Investment holding 3,185,683 Manufacture and marketing of cables Investment holding Retail of office machinery and equipment and electronic appliances, and information software services. Purchase and the sales of cameras NTD NTD NTD 2,042,398 NTD NTD NTD 2,042,398 Held by the Company at December 31, 2012 Net income Investment Income Percentage of (loss) of the (loss) recognized by Number of ownership Investee Company the Company shares (%) Currency Book value Currency Amount Currency Amount Note 3,382,944,787 $ 525,987,469 100 NTD NTD $55,318,054 NTD $ 55,546,752 Note 1 405,502,500 NTD 12,145,012 NTD 986,655 NTD 937,117 Note 98 1 621,000,000 NTD 9,583,913 NTD 1,109,155 NTD 1,109,155 Note 100 1 275,890,000 NTD 8,902,225 NTD 1,127,365 NTD 1,121,328 Note 100 1 53,100,000 107,723,409 124,238,234 97,599,985 267,000,000 250,000,000 53,037,545 72,163,188 106,178,272 100 100 10 100 100 100 100 98 21 NTD NTD NTD NTD NTD NTD NTD NTD NTD NTD NTD 8,743,716 7,498,363 6,181,682 5,600,381 3,652,466 3,388,027 2,488,716 2,442,455 2,296,398 NTD NTD NTD NTD NTD NTD NTD NTD NTD NTD NTD 281,290 1,310,463 8,377,059 424,862 333,582 342,576 78,156 138,080 401,900 NTD NTD NTD NTD NTD NTD NTD NTD NTD NTD NTD 281,290 Note 1 1,310,463 Note 1 854,687 Note 1, 3 397,646 Note 1 333,378 Note 1 342,576 Note 1 81,434 Note 1 134,993 Note 1 91,152 Note 1, 2 9,065 Note 1 ( 48,446) Note 1
Investor Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd.
Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Pan International Taiwan Industrial Industry Co., Ltd. Corporation Hon Hai Precision Lin Yih International Taiwan Industry Co., Ltd. Investment Co., Ltd. Hon Hai Precision Syntrend Creative Park Taiwan Industry Co., Ltd. Co., Ltd.
904,411 1,155,704
904,411 513,260
96,900,000 115,570,400
100 80
978,082 1,080,172
9,881 ( 60,162)
Hon Hai Precision Premier Image Industry Co., Ltd. Technology (H.K)
Hong Kong
NTD
$ 22,311
NTD
$ 22,311
1,409,000
NTD
174,408
NTD
($ 48,241)
NTD
($
785) Note 1, 5
160
Main operating Investee company Address Activities Ltd. and related parts Hon Hai Precision Altus Technology Inc. Taiwan Manufacture, design Industry Co., Ltd. and marketing of cellular phone, camera lens and sensors Hon Hai Precision Others Others Industry Co., Ltd. Hyield, Hon Yuan, Foxsemicon Integrated Taiwan Manufacture of Bao Shin and Technology Inc. semiconductor Hon Chi machinery and sales of computer components Hyield, Hon Yuan, Foxconn Technology Taiwan Manufacture and Bao Shin and Co., Ltd. design of Hon Chi monitors Hon Yuan, Bao Pan International Taiwan Manufacture and Shin, Hon Chi Industrial marketing of and Corporation cables Hon Yiing Hyield, Hon Yuan, Altus Technology Inc. Taiwan Manufacture, Bao Shin, Lin Yih marketing and and Hon Chi design of cellular phone, camera lens and sensors Hyield Antec Electronic Taiwan Manufacture of System Co., Ltd. cable, electronic equipment and electron component of motor vehicles Hyield, Hon Yuan, CyberTAN Taiwan Manufacture, design Bao Shin, Lin Yih Technology, Inc. and marketing of and Hon Chi wireless network equipment Investor
Original investment amount December 31, December 31, Currency 2012 Currency 2011 NTD 865,177 NTD 865,177
Held by the Company at December 31, 2012 Percentage of Number of ownership shares (%) Currency Book value 7,872,911 65 NTD 78,079
Net income (loss) of the Investee Company Currency Amount NTD ( 2,103)
Investment Income (loss) recognized by the Company Currency Amount NTD
Note
( 1,358) Note 1, 4
NTD NTD
163,446 448,110
NTD NTD
163,446 448,110
21,663,004
20
NTD NTD
180,052 23,556
NTD NTD
164,674 ( 387,910)
NTD NTD
81,654 Note 1 ( 114,323) Note 6
NTD
1,992,567
NTD
1,992,567
246,469,620
20
NTD
12,489,422
NTD
8,377,059
NTD
1,678,519 Note 6 22,861 Note 6
NTD
560,639
NTD
560,639
29,180,873
NTD
662,825
NTD
401,900
NTD
NTD
284
NTD
284
4,317,089
35
NTD
42,815
NTD
2,103)
NTD
745) Note 6
NTD
970,000
NTD
970,000
60,010,000
100
NTD
401,401
NTD
( 31,143)
NTD
( 26,414) Note 6
NTD
357,396
NTD
357,396
35,122,013
11
NTD
540,819
NTD
69,766
NTD
5,108 Note 6
Bao Shin and Hyield
Ennoconn Corporation Taiwan
Design and manufacture of
NTD
$ 261,706
NTD
$ 244,291
24,916,107
49
NTD
465,553
NTD
$ 179,196
NTD
$ 95,196 Note 6
161
Investor
Investee company
Address
Bao Shin
UVAT Technology Co., Taiwan Ltd.
Hyield and Bao Shin
Simplo Technology Co., Ltd.
Taiwan
Hon Chi, Hon Yuan, and Bao Shin
Foxnum Technology Co., Ltd.
Taiwan
Hyield, Hon Yuan, G-TECH Bao Shin and Optoelectronics Hon Chi Corporation
Taiwan
Main operating Activities single board computer, embedded board, industrial motherboard Manufacture and sales of vacuum sputtering system and vacuum coating service Information service, manufacture of lighting equipment, data storage and processing system, electronic components, battery, power generation/ transmission/ distribution machinery, and wireless communication system Manufacture and sales of machinery, computer and peripheral devices Manufacture of glass, glass products and electronic components
Original investment amount December 31, December 31, Currency 2012 Currency 2011
Held by the Company at December 31, 2012 Percentage of Number of ownership shares (%) Currency Book value
Net income (loss) of the Investee Company Currency Amount
Investment Income (loss) recognized by the Company Currency Amount
Note
NTD
180,000
NTD
180,000
7,557,835
17
NTD
140,489
NTD
( 245,657)
NTD
( 36,462) Note 69
NTD
1,433,855
NTD
1,433,855
26,575,186
NTD
2,231,052
NTD
3,302,612
NTD
321,203 Note 6
NTD
464,736
NTD
464,736
46,473,600
85
NTD
1,197,379
NTD
282,144
NTD
274,509 Note 6
NTD
1,669,704
NTD
1,669,704
73,128,667
28
NTD
2,943,407
NTD
747,711
NTD
224,126 Note 6, 9
Hyield and Bao Shin
Advanced Microelectronic
Taiwan
Research, development,
NTD
$ 187,820
NTD
$ 187,820
16,271,550
10
NTD
45,641
NTD ($ 300,571)
NTD
($ 34,598) Note 6, 9
162
Main operating Activities design, manufacture and sales of integrated circuit and semiconductor components Foxconn Ways Technical Corp., Taiwan Manufacture of NTD 591,228 NTD 947,772 12,105,248 13 NTD International Ltd. plastic articles, Holdings Limited surface treatment, and manufacture and processing of electronic components Hyield and Bao Bionet Corporation Taiwan Extraction, testing, NTD 100,000 NTD 100,000 3,464,022 7 NTD Shin storage and research on umbilical cord blood stem cells, mesenchymal stem cells, and primary teeth Hyield Ingrasys Technology Taiwan Design, research, NTD 250,705 NTD 222,340 37,410,000 100 NTD Inc. manufacture and sales of data storage and processor Hyield Burrage Capital Cayman Investment NTD 441,300 NTD 441,300 15,000,000 100 NTD Healthcare Offshore Islands holding Fund II, Ltd. Hyield, Hon Yuan, Fitipower Integrated Taiwan Manufacture of NTD 585,000 NTD 45,450,167 39 NTD Bao Shin and Technology Inc. integrated Hon Chi circuit/semiconductor machinery and sales of computer components Hyield, Hon Yuan, Others Others NTD 958,692 NTD 995,692 NTD 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. Investor Investee company Products, Inc. Address
Original investment amount December 31, December 31, Currency 2012 Currency 2011
Held by the Company at December 31, 2012 Percentage of Number of ownership shares (%) Currency Book value
Net income (loss) of the Investee Company Currency Amount
Investment Income (loss) recognized by the Company Currency Amount
Note
722,359
NTD
469,370
NTD
58,024 Note 6, 9
115,922
NTD
62,772
NTD
4,478 Note 6, 9
980,698
NTD
300,394
NTD
283,517 Note 6
411,026
NTD
58,212
NTD
58,212 Note 6 3,476 Note 6, 9
539,011
NTD
( 39,849)
NTD
623,356
NTD
463,369
NTD
( 54,999) Note 6, 8
163
Note 2: The Company and its subsidiaries, directly and indirectly, own 26.57% of Pan International Industrial Corporations outstanding shares. Note 3: The Company and the direct and indirect investee companies own 29.97% 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. Lin Yih International Investment Co., Ltd. is referred to as Lin Yih. Hon Yiing International Investment Co., Ltd. is referred to as Hon Yiing. Note 7: Because the foreign holding investee companies prepare consolidated financial statements only, the disclosure of the companys 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. Note 9: The investee company, a listed or an OTC or Emerging company in Taiwan, has not released the 2012 annual financial information as of March 28, 2013. Thus, the net income for the first three quarter or semi-annual of the investee company should be disclosed instead. 2) Loans to any company or person: Maximum Balance During 2012 $ 293,000 265,000 200,000 450,000 150,000 99,000 1,500,000 117,438 75,160 Nature of Business Ending Interest Financial Transaction Balance Rate (%) Activity Amount $ 293,000 $ Short term financing 265,000 Short term financing 200,000 1.625 Short term financing 450,000 Short term financing 150,000 1.15 Short term financing 97,000 Short term financing 1,000,000 Short term financing Short term financing Short term financing $ Short term $ Allowance for Loan Total loan Doubtful Asset Pledge limit per limit of the Accounts Item Value counterparty company loan Note Note $ - None $ $ $ 1 Note - None 1 Note - None 1 Note - None 1 Note - None 1 Note - None 1 Note - None 1 - None Note 2 - None Note 2 $ None $ $ $ Note
No. Name of company 1 Hon Yuan International Investment Co., Ltd. 2 Hon Chi International Investment Co., Ltd. 2 Hon Chi International Investment Co., Ltd 3 Bon Shin International Investment Co., Ltd. 3 Bon Shin International Investment Co., Ltd. 4 Lin Yih International Investment Co., Ltd. 5 Hyield Venture Capital Co., Ltd. 6 Hongfujin Precision Industrial (Shenzhen) Co., Ltd. 6 Hongfujin Precision Industrial (Shenzhen) Co., Ltd.
Name of Counterparty Account Hon Hai Precision Industry Short-term loansCo., Ltd. Related parties Hon Hai Precision Industry Short-term loansCo., Ltd. Related parties UER Technology Corporation Short-term loansRelated parties Hon Hai Precision Industry Short-term loansCo., Ltd. Related parties SetaBox Technology Co., Ltd. Short-term loansRelated parties Hon Hai Precision Industry Short-term loansCo., Ltd. Related parties Hon Hai Precision Industry Short-term loansCo., Ltd. Related parties Fu Ding Precision Component Entrusted Loans (Shenzhen) Co., Ltd. Futaikang Precision Entrusted Loans Component (Shenzhen) Co., Ltd. 6 Hongfujin Precision Industrial Futaijie Science & Technology Entrusted Loans
Reason for Financing Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business
65,765
164
No.
6 6 7 7
7 7
7 7 8 9 10
10
10
10
11 11
Name of Counterparty Development (Shenzhen) Co., Ltd. Hongfujin Precision Industrial Fu Xun Tong Trading (Shenzhen) Co., Ltd. (Shenzhen) Co., Ltd. Hongfujin Precision Industrial Fuhuajie Industrial (Shenzhen) (Shenzhen) Co., Ltd. Limited Futaihua Industrial (Shenzhen) Shenzhen Fuhongjie Co., Ltd. Technology Service Co., Ltd. Futaihua Industrial (Shenzhen) Futaikang Precision Co., Ltd. Component (Shenzhen) Co., Ltd. Futaihua Industrial (Shenzhen) Fuhuajie Industrial (Shenzhen) Co., Ltd. Limited Futaihua Industrial (Shenzhen) Fuhonyang Precision Co., Ltd. Industrial (Shenzhen) Co., Ltd. Futaihua Industrial (Shenzhen) Foxconn Precision Electronics Co., Ltd. (Taiyuan) Co., Ltd. Futaihua Industrial (Shenzhen) Fujin Precision Industrial Limited (Jincheng) Co., Ltd. Foxconn Precision Component Shenzhen Fuhongjie (Shenzhen) Co., Ltd. Technology Service Co., Ltd. Anpinda Precision Industrial Jizhun Precision Industry (Huizhou) Co., Ltd. (Huizhou) Co., Ltd. Foxconn (Kunshan) Computer Foxconn Electronic Industrial Connector Co., Ltd. Development (Kunshan) Co., Ltd. Foxconn (Kunshan) Computer Kangzhun Electronic Connector Co., Ltd. Technology (Kunshan) Co., Ltd. Foxconn (Kunshan) Computer Hongfujin Precision Connector Co., Ltd. Electronics (Zhengzhou) Co., Ltd. Foxconn (Kun Shan) Fuxiang Precision Industrial Computer Connector Co., (kunshan) Co., Ltd. Ltd. Hongzhun Precision Tooling Fuyao Precision Component (Kunshan) Co., Ltd. (Kunshan) Co., Ltd. Hongzhun Precision Tooling Foxconn Electronic Industrial
Name of company (Shenzhen) Co., Ltd.
Account
Maximum Balance During 2012
Ending Balance
Interest Rate (%)
Nature of Financial Activity financing
Business Transaction Amount
Reason for Financing operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business
Allowance for Loan Total loan Doubtful Asset Pledge limit per limit of the Accounts Item Value counterparty company loan Note 2 None None None None Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 $ $ $ Note 2 Note
Entrusted Loans Entrusted Loans Entrusted Loans Entrusted Loans
522,258 2,677,575 37,857 56,785
507,474 3.25~3.5 Short term financing Short term financing Short term financing 46,134 3.05 Short term financing 2,583,504 3,206,313 3.05 3.05 Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing
Entrusted Loans Entrusted Loans
2,583,504 3,225,356
None None
Entrusted Loans Entrusted Loans Entrusted Loans Entrusted Loans Entrusted Loans
7,216,656 4,640,800 108,043 2,427,571 839,639
7,012,368 4,613,400 2,427,571 839,639
3.5 3.25 3.05 2.6
None None None None None
Entrusted Loans
474,780
None
Entrusted Loans
1,414,740
None
Entrusted Loans
1,180,300
1,153,350
2.28
None
70,737 $ 1,424,340
$ 1,384,020
2.28
$ -
$ -
None None
165
No.
Name of company (Kunshan) Co., Ltd.
11 Hongzhun Precision Tooling (Kunshan) Co., Ltd. 11 Hongzhun Precision Tooling (Kunshan) Co., Ltd. 11 Hongzhun Precision Tooling (Kunshan) Co., Ltd. 12 Ambit Microsystem (Shanghai) Co., Ltd. 12 Ambit Microsystem (Shanghai) Co., Ltd.
12 Ambit Microsystem Entrusted Loans (Shanghai) Co., Ltd. 13 Fuxiang Precision Industrial Foxconn Precision Electronics Entrusted Loans (Kunshan) Co., Ltd. (Taiyuan) Co., Ltd. 14 Fulin Electronical Technology Kangzhun Electronic Entrusted Loans (Changshu) Co., Ltd. Technology (Kunshan) Co., Ltd. 15 Fuyang Electronical Fuxiang Precision Industrial Entrusted Loans Technology (Changshu) Co., (Kunshan) Co., Ltd. Ltd. 15 Fuyang Electronical Foxconn Electronic Industrial Entrusted Loans Technology (Changshu) Co., Development (Kunshan) Co., Ltd. Ltd. 16 FuYu Energy Technology Foxconn Electronic Industrial Entrusted Loans (Kunshan) Co., Ltd. Development (Kunshan) Co., Ltd. 17 Foxway Precision Industry Kangzhun Electronic Entrusted Loans (Hangzhou) Co., Ltd. Technology (Kunshan) Co., Ltd. 18 Fuzhun Precision Tooling Fuyu Electronical Technology Entrusted Loans (Huaian) Co., Ltd. (Huaian)Co., Ltd.
Name of Counterparty Development (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Qunkang Precision Component (Kunshan) Co., Ltd. Foxconn Electronic Industrial Development (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Shanghai Foxconn Co., Ltd.
Account
Maximum Balance During 2012
Ending Balance
Interest Rate (%)
Nature of Financial Activity
Business Transaction Amount
Reason for Financing operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation
Allowance for Loan Total loan Doubtful Asset Pledge limit per limit of the Accounts Item Value counterparty company loan Note 2 None Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2
Entrusted Loans
1,084,634
461,340
2.6
Short term financing Short term financing Short term financing Short term financing
1,186,950 337,094
1,153,350 327,551
2 3.1
None None
Entrusted Loans
768,675
None
Entrusted Loans
1,661,730
1,457,834 2.28~2.6 Short term financing 115,335 2.85 3.5 Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing
None
118,695 1,178,950 1,424,340
None None None
811,118
747,371
2.6
None
1,384,020
1,384,020
2.6
None
626,508
622,809
2.28
None
461,340
461,340
2.6
None
954,974
954,974
2.6
None
166
No. Name of company 19 Fu Tai Kang Electronics Development (Yantai) Ltd. 19 Fu Tai Kang Electronics Development (Yantai) Ltd.
Name of Counterparty YanTai FuHuaDa Precision Electronics Co., Ltd.
Account Entrusted Loans
Maximum Balance During 2012 $ 235,790 730,949 330,106 2,550,094 2,373,900 282,948
Nature of Business Ending Interest Financial Transaction Balance Rate (%) Activity Amount $ Short term $ financing 415,206 3.92 Short term financing Short term financing -
Reason for Financing Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation
Foxconn Precision Electronics Entrusted Loans (Yantai) Co., Ltd. Entrusted Loans
20 Hongfujin Precision Electrons YanTai FuHuaDa Precision (Yantai) Co., Ltd. Electronics Co., Ltd.
20 Hongfujin Precision Electrons Foxconn Precision Electronic Entrusted Loans (Yantai) Co., Ltd. (Yantai) Co., Ltd. 20 Hongfujin Precision Electrons Foxconn Precision Electronics Entrusted Loans (Yantai) Co., Ltd. (Taiyuan) Co., Ltd. 21 Hongfujin Precision Electronics (Chengdu) Co., Ltd. 22 Hongfujin Precision Electronics (Zhenzhou) Co., Ltd. 22 Hongfujin Precision Electronics (Zhenzhou) Co., Ltd. 22 Hongfujin Precision Electronics (Zhenzhou) Co., Ltd. 23 Foxconn (Far East) Limited Futaihua Precision Electronics Entrusted Loans (Chengdu) Co., Ltd. Foxconn Precision Electronics Entrusted Loans (Taiyuan) Co., Ltd. Fuding Precision (Zhengzhou) Entrusted Loans Co., Ltd. Futaihua Precision Electronics Entrusted Loans (Jiyuan) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Margini Holdings Ltd. Other Receivablesfinancing Other Receivablesfinancing Other Receivablesfinancing Other Receivablesfinancing Other Receivablesfinancing
2,442,359 0.36725~ Short term 3.92 financing 2,306,700 4.2 Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing Short term financing
Allowance for Loan Total loan Doubtful Asset Pledge limit per limit of the Accounts Item Value counterparty company loan Note $ - None $ $ $ - Note 2 - None - Note 2 - None - Note 2 - None - Note 2 - None - Note 2 - None - Note 2 None Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2
1,186,950
1,153,350
3.1
1,614,690
1,614,690 2.6~3.1
None
2,320,400
2,306,700
2.6
None
5,109,350
4,936,970
0.56
Business operation Business operation Business operation Business operation Business operation
None
23 Foxconn (Far East) Limited
377,350
None
Fu Ding Precision Industrial (Zhengzhou) Co., Ltd. Fuyu Electronical Technology (Huaian) Co., Ltd. Foxconn (Kun Shan) Computer Connector Co., Ltd.
446,040
None
450,825
None
895,054
None
167
No. Name of company 23 Foxconn (Far East) Limited
Account Other Receivablesfinancing 23 Foxconn (Far East) Limited Other Receivablesfinancing 24 Foxconn CZ S. R. O. Foxconn TR Teknoloji Sanayi Other Ltd. Sirketi Receivablesfinancing 25 Shenzhen Fu Tai Hong Foxconn (Tianjin) Precision Entrusted Loans Precision Industry Co., Ltd. Industry Co., Ltd 25 Shenzhen Fu Tai Hong Foxconn Precision Electronics Entrusted Loans Precision Industry Co., Ltd. (Lang Fang) Co., Ltd. 26 Foxconn Precision Component Foxconn Precision Electronics Entrusted Loans (Beijing) Co., Ltd. (Lang Fang) Co., Ltd. 26 Foxconn Precision Component Futaijing Precision Electronics Entrusted Loans (Beijing) Co., Ltd. (Beijing) Co., Ltd. 26 Foxconn Precision Component Foxconn (Tianjin) Precision (Beijing) Co., Ltd. Industry Co., Ltd. 27 Execustar International Ltd. 28 Foxconn International Holdings Limited 28 Foxconn International Holdings Limited Foxconn Precision Electronics (Lang Fang) Co., Ltd. Foxconn (Tianjin) Precision Industry Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Entrusted Loans Other Receivables Other Receivables Other Receivables
Name of Counterparty Kangzhun Electronic Technology (Kunshan) Co., Ltd. Fuxiang Precision Industrial (Kunshan) Co., Ltd.
Maximum Balance During 2012 $ 1,803,300
Nature of Business Ending Interest Financial Transaction Balance Rate (%) Activity Amount $ 1,742,460 0.21 $ Short term financing $ 1,742,460 0.21 Short term financing Short term financing -
Reason for Financing Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation Business operation
Allowance for Loan Total loan Doubtful Asset Pledge limit per limit of the Accounts Item Value counterparty company loan Note $ - None $ $ $ - Note 2 None Note 2 Note 2 Note 3 Note 3 Note 3 Note 3 Note 3 Note 3 Note 3 Note 3
2,973,600
300,550
290,410
3.5
None
807,126 5,222,580 3,560,850 7,596,480 1,424,340 510,935 3,125,720 3,967,260
784,278 3.25~3.5 Short term financing 5,074,740 3,460,050 7,381,440 1,384,020 493,697 3~3.5 3.5 3~3.5 3~3.5 0.4416 Short term financing Short term financing Short term financing Short term financing Short term financing
None None None None None None None None
3,020,264 0.2071~ Short term 0.4615 financing 3,833,412 0.2071~ Short term 0.55 financing
Note 1: 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 2: 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 Companys net assets; limit on loans granted by an overseas subsidiary to a single overseas subsidiary is 10% of the Companys net assets. Note 3: The policy for loans granted by overseas subsidiaries of which 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 Foxconn International Holdings Limited; limit on loans granted by an overseas subsidiary to a single party is 30% of the net assets value of Foxconn International Holdings Limited.
168
3) Guarantee information: Parties being guaranteed Ratio of Highest Outstanding accumulated Ceiling of Limit of outstanding guarantee Amount of guarantee amount the outstanding guarantee guarantee amount amount as of guarantee with to net assets guarantee to the Number Name of guarantor Name of company Relationship with the Company for such party in 2012 12/31/2012 collateral placed of the Company respective party Note 1 Hongfujin Precision Fu Ding Precision The Company and its subsidiaries hold $ $ 13,840 $ 13,840 $ $ Note Industry (Shenzhen) Co., Component (Shenzhen) more than 50% of common shares of 1, 2, 3, 4 Ltd. Co., Ltd. the investee company 1 Hongfujin Precision Fuhuajie Industrial The Company and its subsidiaries hold 2,547,090 2,360,065 0.37 Note Industry (Shenzhen) Co., (Shenzhen) Limited more than 50% of common shares of 1, 2, 3, 4 Ltd. the investee company 1 Hongfujin Precision Futaihua Industrial The Company and its subsidiaries hold 12,172,275 2,934,428 0.45 Note Industry (Shenzhen) Co., (Shenzhen) Co., Ltd. more than 50% of common shares of 1, 2, 3, 4 Ltd. the investee company Note1: The Companys total guarantees to others should not be in excess of the Companys net assets. Note2: The Companys guarantees provided for a single party should not be in excess 50% of the Companys net assets. Note3: Guarantees to overseas subsidiaries of which the Company directly and indirectly hold 100% of their voting shares should not exceed 50% of the Companys net assets; the limit of guarantee for a single entity should not be in excess of 20% the Companys net assets. Note4: The net assets referred above are based on the latest audited or reviewed financial statements. 4)Marketable securities held as of December 31, 2012: Type and name of Relationship of the issuers General ledger Number of shares marketable securities (Note 1) with the investee company account (Note 1) (in thousands) (1) 3,601 Common stock of Pan International Investee company accounted for under the Industrial Corporation equity method (1) 112,195 Common stock of Foxconn Technology Investee company accounted for under the Co., Ltd. equity method (1) 2,182 Common stock of CyberTAN Technology Indirect investee company accounted for Inc. under the equity method (1) 12,884 Common stock of Simplo Technology Co., Indirect investee company accounted for Ltd. under the equity method (1) 6,976 Common stock of Advanced Indirect investee company accounted for Microelectronic Products, Inc. under the equity method December 31, 2012 Ownership Book value Percentage % $ 88,120 1 5,656,648 33,589 1,081,616 3,358 9 1 4 4 Market Value/ Net worth Note $ 71,066 5,548,409 33,551 726,172 31,728
Name of investors Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd.
169
Name of investors Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd. Bon Shin International Investment Co., Ltd.
Type and name of marketable securities (Note 1) Common stock of Bionet Corporation
Bon Shin International Investment Co., Ltd. Hon Chi International Investment Co., Ltd. Common stock of Pan International
Relationship of the issuers with the investee company Indirect investee company accounted for under the equity method Common stock of G-TECH Indirect investee company accounted for Optoelectronics Corporation under the equity method Common stock of Ability OPTOIndirect investee company accounted for Electronics Technology Co., Ltd. under the equity method Common stock of UVAT Technology Co., Indirect investee company accounted for Ltd. under the equity method Common stock of Foxsemicon Integrated Indirect investee company accounted for Technology Inc. under the equity method Common stock of Shin Puu Technology Indirect investee company accounted for Co., Ltd. under the equity method Common stock of HealthConn Co. Indirect investee company accounted for under the equity method Fitipower Integrated Technology Inc. Indirect investee company accounted for under the equity method Common stock of Entire Technology Co., None Ltd. Common stock of MiTAC Information None Technology Co. Common stock of MiTAC Inc. None
General ledger Number of shares account (Note 1) (in thousands) (1) 1,732 (1) (1) (1) (1) (1) (1) (1) (2) (3) (3) (1) (1) (1) (1) (1) (1) (1) 17,262 10,000 7,558 4,837 1,475 4,875 14,140 2,100 1,775 2,482 7,483 28,338 2,835 15,127 4,947 695 10,100
December 31, 2012 Ownership Book value Percentage % $ 57,961 4 694,348 133,585 140,489 5,260 28,633 33,132 167,693 87,045 33,006 39,252 168,085 1,468,014 43,649 610,396 5,379 13,482 119,780 7 8 17 4 8 24 12 1 1 1 1 2 1 6 5 4 9
Market Value/ Net worth Note $ 40,998 670,995 133,585 111,747 5,192 28,633 37,146 172,644 87,045 33,006 39,252 147,662 1,401,386 43,598 587,977 5,309 13,482 123,317
Investee company accounted for under the Industrial Corporation equity method Hon Chi International Investment Co., Ltd. Common stock of Foxconn Technology Investee company accounted for under the Co., Ltd. equity method Hon Chi International Investment Co., Ltd. Common stock of CyberTAN Technology Indirect investee company accounted for Inc. under the equity method Hon Chi International Investment Co., Ltd. Common stock of G-TECH Indirect investee company accounted for Optoelectronics Corporation under the equity method Hon Chi International Investment Co., Ltd. Common stock of Foxsemicon Integrated Indirect investee company accounted for Technology Inc. under the equity method Hon Chi International Investment Co., Ltd. Common stock of Shin Puu Technology Indirect investee company accounted for Co., Ltd. under the equity method Hon Chi International Investment Co., Ltd. Fitipower Integrated Technology Inc. Indirect investee company accounted for under the equity method
170
Relationship of the issuers General ledger Number of shares Name of investors with the investee company account (Note 1) (in thousands) (1) 17,676 Hon Yuan International Investment Co., Investee company accounted for under the Ltd. equity method (1) 30,355 Hon Yuan International Investment Co., Investee company accounted for under the Ltd. equity method (1) 10,035 Hon Yuan International Investment Co., Indirect investee company accounted for Ltd. under the equity method (1) 24,858 Hon Yuan International Investment Co., Indirect investee company accounted for Ltd. under the equity method (1) 4,745 Hon Yuan International Investment Co., Indirect investee company accounted for Ltd. under the equity method (1) 9,090 Hon Yuan International Investment Co., Indirect investee company accounted for Ltd. under the equity method (2) 2,206 Hon Yuan International Investment Co., Common stock of Entire Technology Co., None Ltd. Ltd. (1) 10,035 Lin Yih International Investment Co., Ltd. Common stock of CyberTAN Technology Indirect investee company accounted for Inc. under the equity method (2) 3,857 Lin Yih International Investment Co., Ltd. Common stock of AcBel Polytech Inc. None Hyield Venture Capital Co., Ltd. (1) 75,582 Common stock of Foxconn Technology Investee company accounted for under the Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Co., Ltd. equity method Common stock of CyberTAN Technology Indirect investee company accounted for Inc. under the equity method Common stock of Simplo Technology Co., Indirect investee company accounted for Ltd. under the equity method Common stock of Advanced Indirect investee company accounted for Microelectronic Products, Inc. under the equity method Common stock of Bionet Corporation Indirect investee company accounted for under the equity method Common stock of G-TECH Indirect investee company accounted for Optoelectronics Corporation under the equity method Common stock of Foxsemicon Integrated Indirect investee company accounted for Technology Inc. under the equity method Common stock of Shin Puu Technology Indirect investee company accounted for Co., Ltd. under the equity method Fitipower Integrated Technology Inc. Indirect investee company accounted for under the equity method (1) (1) (1) (1) (1) (1) (1) (1) 10,035 13,691 9,296 1,732 15,882 7,134 1,563 12,120
Type and name of marketable securities (Note 1) Common stock of Pan International Industrial Corporation Common stock of Foxconn Technology Co., Ltd. Common stock of CyberTAN Technology Inc. Common stock of G-TECH Optoelectronics Corporation Common stock of Foxsemicon Integrated Technology Inc. Fitipower Integrated Technology Inc.
December 31, 2012 Ownership Book value Percentage % $ 396,877 4 1,567,821 154,527 999,862 5,160 107,802 91,441 154,527 79,261 3,796,939 154,527 1,149,436 42,283 57,961 638,801 7,757 30,307 143,736 3 3 9 4 8 2 3 1 6 3 5 6 3 6 7 9 10
Market Value/ Net worth Note $ 348,802 1,501,167 154,351 966,233 5,092 110,985 91,441 154,351 79,261 3,737,763 154,351 771,658 42,283 40,998 617,316 7,656 30,347 147,980
171
Name of investors Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hyield Venture Capital Co., Ltd. Hon Yiing International Investment Co., Ltd. Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn (Far East) Limited Foxconn (Far East) Limited
Type and name of marketable securities (Note 1) Common stock of HealthConn Co. Common stock of TXC Corporation Common stock of Unimicron Corporation
Relationship of the issuers with the investee company Indirect investee company accounted for under the equity method None None
General ledger Number of shares account (Note 1) (in thousands) (1) 4,875 (2) (2) (2) (2) (2) (3) (3) (1) (1) (1) (1) (1) (1) (1) (1) (3) (2) (2) (3) (3) (1)(2)(3) 466 3,400 3,098 163,989 2,300 435 2,395 421 5,081,035 30,009 10,463 44,036 24,616 11,709 6,430 3,314 4,108 6,246 -
December 31, 2012 Ownership Book value Percentage % $ 33,132 24 22,281 104,720 69,085 2,558,232 33,465 4,467 28,740 98,922 9,743 70,942,322 8,444,318 818,234 1,491,078 653,425 121,757 5,450,631 67,199 2,060,892 120,856 24,952 2,975,986 2 2 1 15 1 69 41 45 29 43 33 11 3 3 5 18 -
Market Value/ Net worth Note $ 37,146 22,281 104,720 69,085 2,558,232 33,465 4,467 28,740 98,922 8,312 70,942,322 8,434,765 818,234 1,491,078 653,425 121,757 5,450,631 67,199 2,060,892 120,856 24,952 2,975,986
Common stock of Foxlink Image None Technology Co., Ltd. Common stock of Innolux Corporation The Companys chairman is the major (Formerly Chimei Innolux Corporation) shareholder Common stock of Microelectronics None Technology Inc. Common stock of Deer Computer Co., Ltd. Common stock of Tera Xtal Technology Co., Ltd. Others (Note 2) Common stock of Pan International Industrial Corporation Foxconn International Holdings Ltd. Zhen Ding Technology Holding Limited Ampower Holdings Ltd. Eson Precision Ind. Co., Ltd. UER Holdings Corporation Excelstor Group Ltd. Woodman Labs, Inc. Solytech Enterprise Corporation Olympus Corporation Shenzhen Yuto Printing Corporation Easpnet Inc. Others (Note 2) None None None Investee company accounted for under the equity method Subsidiary owned by Foxconn (Far East) Ltd. Indirect investee company accounted for under the equity method Indirect investee company accounted for under the equity method Indirect investee company accounted for under the equity method Indirect investee company accounted for under the equity method Indirect investee company accounted for under the equity method None None None None None None
172
Name of investors Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Holding Ltd. Foxconn Singapore Pte. Ltd. Foxconn International Holdings Limited
Type and name of marketable securities (Note 1) Alliance Fiber Optic Products, Inc. Venglobal Capital Fund III, L.P. S.A.S Dragon Holdings Ltd. P. I. E Industrial Berhad Invensense Inc. Dimandhead Venture L. P. Riverwood Capital L. P. Aptina Acquisition L. P. WIMM Labs Ltd. Fuhu Inc. Innovation Works Limited Innovation Works Development Fund. L. P. Firebrand Wireless LLC. Others (Note 2) P. I. E Industrial Berhad
Relationship of the issuers General ledger Number of shares with the investee company account (Note 1) (in thousands) (1) 8,000 Indirect investee company accounted for under the equity method (1) Investee company accounted for under the equity method (2) 46,000 None None None None None None None None None None None None None (2) (2) (3) (3) (3) (3) (3) (3) (3) (3) (1)(3) (2) (1) (1) (1) (1) 2,227 5,000 10 12,105 75 8,000 12,100
December 31, 2012 Ownership Book value Percentage % $ 377,873 20 224,804 249,503 86,777 463,434 315,932 845,580 153,564 297,704 290,400 75,504 209,088 81,725 197,392 420 722,359 205,168 106,868 108,618 5 13 20 6 50
Market Value/ Net worth Note $ 377,873 224,804 249,503 86,777 463,434 315,932 845,580 153,564 297,704 290,400 75,504 209,088 81,725 197,392 420 722,359 205,168 106,868 108,618
Common stock of Ways Technical Corp., Indirect investee company accounted for Ltd. under the equity method Foxconn International Holdings Limited Diabell Co., Ltd. Indirect investee company accounted for under the equity method Foxconn International Holdings Limited Common stock of Ability OPTOIndirect investee company accounted for Electronics Technology Co., Ltd. under the equity method Foxconn International Holdings Limited Ways Transworld Inc. Indirect investee company accounted for under the equity method Note 1: Code of general ledger accounts: (1) Long-term investment accounted for under the equity method (2) Available-for-sale financial assets-noncurrent (3) Financial assets carried at cost - non-current Note 2: Due to the amount is insignificant, combined disclosure is adopted.
173
5) Marketable securities acquired or sold during the year ended December 31, 2012 in excess of $100,000 or 20% of total contributed capital: Relationship Beginning balance Addition Type and name of the issuers Number of Number of of marketable General ledger with the Shares Shares Investor securities account Counterparty Company (in thousands) Amount (in thousands) Amount $ 45,000 $ 585,000 Hyield, Bao Shin, Fitipower Long-term investments Note 2 None Hon Yuan and Integrated accounted for under Hon Chi Technology Inc. the equity method 13,476 336,886 Hyield and Hon Chi Lin Financial assets carried Note 3 None Chi Technology at cost Co., Ltd. 19,524 488,114 Hyield and Hon Chi Lin Financial assets carried Note 3 None Chi Optoelectronics at cost Co., Ltd. 200,000 Hyield Microelectronics Financial assetsNote 3 None Technology Inc. corporate bonds designated as at fair value through profit or loss Foxconn (Far Woodman Labs Financial assets carried 11,709 5,450,631 Note 2 None East) Limited Inc. at cost Foxconn (Far 7,998 3,676,887 Olympus Available for sale Public Market None East) Limited Corporation financial assets-non current Foxconn (Far 19,142 440,222 26,203 3,875,403 Others Available for sale Public Market None East) Limited financial assets-non current Foxconn (Far 2,252,912 ShenZhen Long-term investments Note 4 None East) Limited Futaihong accounted for under Bright Real the equity method Estate Co., Ltd. Foxconn (Far 19,405 947,772 Ways Technical Long-term investments Public Market None East) Limited Corp., Ltd. accounted for under the equity method Foxconn (Far 1,147,080 Interface Long-term investments Note 5 None East) Limited Optoelectronics accounted for under (Shenzhen) the equity method Co., Ltd. Foxconn (Far 744,851 Interface Long-term investments Note 5 None East) Limited Technology accounted for under (Chengdu) Co., the equity method Ltd.
Disposal Ending balance Number of Number of Shares Gain (loss) Shares (in thousands) Selling price Book value on disposal (in thousands) Amount $ $ $ 45,000 $ 585,000
13,476
336,886
336,886
19,524
488,114
488,114
200,000
4,683
2,408,075
2,180,833
365,019
11,709 3,315
5,450,631 1,496,054
41,656
4,690,874
3,986,647
704,227
3,689
328,978
2,940,354
2,252,912
762,534
7,300
497,428
356,544
121,169
12,105
591,228
1,147,080
744,851
174
Relationship Beginning balance Addition Disposal Ending balance Type and name of the issuers Number of Number of Number of Number of of marketable General ledger with the Shares Shares Shares Gain (loss) Shares Investor securities account Counterparty Company (in thousands) Amount (in thousands) Amount (in thousands) Selling price Book value on disposal (in thousands) Amount Foxconn (Far $ 3,000,000 $ 115,404 $ $ $ 3,000,000 $ 115,404 Excel Victory Long-term investments Note 5 None East) Limited Ltd. accounted for under the equity method Note 1: The amount referred above is determined based on initial cost. Note 2: Acquired through private placement. Note 3: Innolux Corporation Ltd. (Formerly: Chimei Innolux Corporation) Note 4: Shenzhen Urban Construction Investment and Development Corporation. Note 5: Blooming Progress Limited. 6) Acquisition of real estate exceeding the amount of $100,000 or 20% of total contributed capital: None. 7) Disposal of real estate exceeding the amount of $100,000 or 20% of total contributed capital: Date of Status of Basis or reference Reason for Other Disposal original collection Gain (loss) Counter used in setting Property Date of disposal acquisition Book value amount party Relationship disposal commitments Property disposed of by of proceeds on disposal the price Chi Mei Communication Land and building 2012.10.3 Note 1 $ 629,602 $ 458,849 $ 458,849 $ 170,753 Note 2 No Disposal of idle Note 3 None System, Inc. assets Note 1: Land and building were acquired on May 23, 2005 and December 31, 2002, respectively. Note 2: Chi Mei Corporation Note 3: By reference to the appraisal reports issued by the Elite Appraisers Firm and Evermore Consulting Co., Ltd. 8) Related party purchases or sales transactions in excess of $100,000 or 20% of total contributed capital: please see information on significant transactions in Note 11(1) and the following disclosures. Difference with general Notes and accounts Transactions transactions receivable (payable) Relationship with Percentage of Percentage Company Counterparty the Company Purchases /sales Amount purchases / sales Terms Unit price Terms Balance of balance Note Ambit Microsystems (Zhong shan) Unique Logistics Ltd. Note 2 Sales $ 3,489,981 72 45 days Note 1 Note 1 $ Corporation Ambit Microsystem (Zhong shan) Ambit Microsystem Co., Ltd. Note 2 Sales 1,312,412 27 45 days Note 1 Note 1 1,299,771 99 Co., Ltd. Unique Logistics Ltd. Ambit Microsystems (Zhong shan) Note 2 Sales 1,586,678 32 60 days Note 1 Note 1 Corporation Ambit Microsystem (Shanghai) Co., AMB Logistics Ltd. Note 2 Sales 27,659,650 75 60 days Note 1 Note 1 1,456,576 42 Ltd. Ambit Microsystem (Shanghai) Co., Amworld Microsystems (Shanghai) Ltd. Note 2 Sales 2,641,109 10 90 days Note 1 Note 1 186,276 5 Ltd. Ambit Microsystem (Shanghai) Co., Funing Precision Component Co., Ltd. Note 2 Sales 126,949 1 60 days Note 1 Note 1 17,456 1 Ltd. Ambit Microsystem (Shanghai) Co., Foxconn Technology (India) Private Limited Note 2 Sales 187,463 2 120 days Note 1 Note 1 123,279 4 Ltd.
175
Transactions Company Ambit Microsystem (Shanghai) Co., Ltd. Ambit Microsystem (Shanghai) Co., Ltd. Ambit Microsystem (Shanghai) Co., Ltd. Ambit Microsystem (Shanghai) Co., Ltd. Ambit Microsystem (Shanghai) Co., Ltd. Ingrasys Technology Co., Ltd. Ingrasys Technology Co., Ltd. Foxnum Technology Co., Ltd. Foxnum Technology Co., Ltd. FIH (Hong Kong) Limited FIH (Hong Kong) Limited FIH (Hong Kong) Limited FIH (Hong Kong) Limited FIH (Hong Kong) Limited FIH (Hong Kong) Limited FIH (Hong Kong) Limited Honxun Electrical Industry (Hangzhou) Co., Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Counterparty Hongfujin Precision Electronics (Chongqing) Co., Ltd CyberTAN Technology Inc. System Intergation Electronics (Hangzhou) Co., Ltd. Foxconn Technology Pte. Ltd. IRIS World Enterprises Ltd. Ingrasys Technology USA Inc. PCE Paragon Solutions Kft. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Fujin Precision Industry (Jincheng) Co. Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Chi Mei Communication System, Inc. Foxconn India PVT. Ltd. Sutech Industry Inc. Foxconn Precision Electronics (Lang Fang) Co., Ltd. Shenzhen Fuhongjie Technology Service Co., Ltd. Futaihua Industrial (Shenzhen) Limited Hon Fujin Precision Industry (Taiyuan) Co. Ltd. FIH (Hong Kong) Limited Foxconn Precision Electronics (Lang Fang) Co., Ltd. Relationship with the Company Purchases /sales Amount Note 2 Sales $ 471,007 Note 7 Note 2 Note 3 Note 4 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 3 Note 2 Note 2 Sales Sales Purchases Purchases Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Purchase Sales Sales 241,496 34,479 171,800 293,003 3,851,947 382,571 119,483 1,254,069 585,142 11,196,892 238,584 4,780,868 1,030,227 130,488 180,600 103,049 2,252,706 831,766 Percentage of purchases / sales Terms 2 90 days 1 1 50 5 8 86 2 36 1 15 3 1 1 12 4 90 days 60 days 30 days 90 days 90 days 45 days 90 days 30 days 45 days 90 days 45 days 75 days 45 days 60 days 30 days 60 days 60 days 45 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 15,568 194,116 17,630 ( ( 45,896) 65,826) 1,470,556 110,099 475 139,166 107,827 1,083,664 107,616 492,850 148,297 7,322 129,558 ( 87,387) 192,756 682,907 ( ( 6 1) 62 5 84 2 20 2 9 3 2 5) 5 16
176
Transactions Company Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Counterparty NanNing FuTaiHong Precision Industry Co. Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Futaihua Industrial (Shenzhen) Limited Relationship with the Company Purchases /sales Note 2 Sales Note 2 Note 2 Sales Sales Percentage of Amount purchases / sales Terms $ 1,504,892 8 60 days 389,221 242,156 2 1 45 days 60 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 759,974 18 184,701 163,982 4 4
Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd.
Fuhuajie Industrial (Shenzhen) Co., Limited Hon Fujin Precision Industrial (Taiyuan) Co., Ltd.
Note 2 Note 3 Note 2 Note 2 Note 2 Note 2 Note 3 Note 2 Note 6 Note 4 Note 2 Note 2
Sales Purchase Sales Sales Sales Sales Purchases Sales Purchases Purchases Sales Sales
181,925 213,869 1,288,198 245,402 189,832 253,427 126,772 11,494,753 128,862 415,779 215,702 204,381
1 1 27 5 4 5 4 93 7 23 -
90 days 60 days 30 days 30 days 45 days 45 days 60 days 60 days 60 days 90 days 30 days 60 days
Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 ( ( ( (
23,745 34,698) 56,709 163,709 167,795 72,510 73,364) 518,907 3,783) 50,598) 83,795 183,779 ( ( (
1 1) 4 12 12 5 4) 53 3) 1 2
Foxconn Precision Component FIH (Hong Kong) Limited (Beijing) Co., Ltd. Foxconn Precision Component Foxconn (Tianjin) Precision Industry Co., Ltd. (Beijing) Co., Ltd. Foxconn Precision Component Futaijing Precision Electronics (Beijing) Co., (Beijing) Co., Ltd. Ltd. Foxconn Precision Component Foxconn Precision Electronics (Lang Fang) (Beijing) Co., Ltd. Co., Ltd. Foxconn Precision Component Hon Fujin Precision Industrial (Taiyuan) Co., (Beijing) Co., Ltd. Ltd. Foxconn (Tianjin) Precision Industry FIH (Hong Kong) Limited Co., Ltd. Foxconn (Tianjin) Precision Industry Innolux Display Corporation Co., Ltd. Foxconn (Tianjin) Precision Industry IRIS World Enterprises Ltd. Co., Ltd. Futaijing Precision Component FIH (Hong Kong) Limited (Beijing) Co., Ltd. Futaijing Precision Component Foxconn Precision Component (Beijing) Co., (Beijing) Co., Ltd. Ltd.
177
Transactions Company Futaijing Precision Component (Beijing) Co., Ltd. Futaijing Precision Component (Beijing) Co., Ltd. Futaijing Precision Component (Beijing) Co., Ltd. Futaijing Precision Component (Beijing) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Eliteday Enterprises Limited Eliteday Enterprises Limited Eliteday Enterprises Limited Counterparty Foxconn Precision Electronics (Langfang) Co., Ltd. Hongfujin Precision Industry (Yantai) Co., Ltd. Innolux Corporation Ltd. (Formerly Chimei Innolux Corporation) IRIS World Enterprises Ltd. FIH (Hong Kong) Limited Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Foxconn Precision Component (Beijing) Co., Ltd. Foxconn (Tianjin) Precision Industry Co., Ltd. Futaijing Precision Electronics (Beijing) Co., Ltd. Eliteday Enterprises Limited. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Innolux Corporation Ltd. (Formerly Chimei Innolux Corporation) Hon Fujin Precision Industry (Taiyuan) Co., Ltd. IRIS World Enterprises Limited Foxconn India Private Limited FIH Europe Limited (Hungary) Foxconn Do Brasil Ind. E Comercio De Eletronicos Ltda. Relationship with the Company Purchases /sales Note 2 Sales Note 2 Note 6 Note 3 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 6 Note 3 Note 4 Note 2 Note 2 Note 2 Sales Purchases Purchases Sales Sales Sales Sales Sales Sales Sales Purchases Purchases Purchases Sales Sales Sales Percentage of Amount purchases / sales Terms $ 447,744 1 45 days 111,699 1,009,105 608,401 12,414,627 170,764 1,428,144 482,392 405,700 8,655,997 113,456 1,103,405 519,761 225,040 410,029 619,183 147,610 2 1 36 4 1 1 25 5 2 1 5 7 2 45 days 60 days 60 days 30 days 30 days 45 days 45 days 45 days 60 days 60 days 45 days 90 days 60 days 45 days 60 days 60 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 202,857 2 1,108 ( ( 202,638) 180,173) 746,307 140,273 1,026,944 234,987 112,966 142,851 27,126 ( ( ( 506,970) 368,898) 37,755) 60,611 7,488 ( ( ( ( 2) 2) 10 2 14 3 2 2 6) 5) 7 1 -
178
Transactions Company Eliteday Enterprises Limited NanNing FuTaiHong Precision Industry Co., Ltd. FuTaiJing Precision Electrons (Yantai) Co., Ltd FuTaiJing Precision Electrons (Yantai) Co., Ltd Foxway Precision Industry (Hangzhou) Co., Ltd. Carston Ltd. Carston Ltd. Carston Ltd. Carston Ltd. Carston Ltd. Carston Ltd. Carston Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Counterparty Foxconn Precision Electronics (Langfang) Co., Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd. FIH (Hong Kong) Limited Futaijing Precision Electronics (Beijing) Co., Ltd. System Integration Electronics (Hangzhou) Co., Ltd. Competition Team Ireland Limited Lakers Trading Ltd. High Tempo International Ltd. IRIS World Enterprises Ltd. High Tempo International Ltd. Foxconn Technology Pte. Ltd. IRIS World Enterprises Limited Ambit Microsystem (Shanghai) Co., Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Carston Ltd. Fu Ding Precision Component (Shenzhen) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Foxconn Electronic Industrial Development (Kunshan) Co., Ltd. Relationship with the Company Purchases /sales Note 2 Sales Note 2 Note 2 Note 2 Note 2 Note 2 Note 6 Note 3 Note 4 Note 3 Note 3 Note 4 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Sales Sales Sales Sales Subcontract Revenue Subcontract Revenue Subcontract Revenue Sales Subcontract Fee Subcontract Fee Subcontract Fee Sales Sales Subcontract Revenue Sales Sales Sales Percentage of Amount purchases / sales $ 1,423,956 17 1,843,795 1,272,026 2,644,433 110,641 384,978 686,231 1,794,704 232,083 2,562,469 203,616 113,724 276,479 328,406 2,448,197 3,392,067 138,689 171,059 74 32 68 22 5 9 22 3 40 3 2 2 3 Terms 7 days 60 days 30 days 45 days 45 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 366,772 41 860,295 421,475 1,657,101 18,946 1,040,837 157,711 ( ( 295,371) 11,871) 33,965 124,028 283,725 1,254,847 119,083 110,126 ( ( 52 20 79 22 4 21) 1) 1 5 -
179
Transactions Company Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Counterparty Heroic Legend Enterprises Ltd. Relationship with Percentage of the Company Purchases /sales Amount purchases / sales Note 2 Subcontract $ 14,223,306 14 Revenue Yantaishi Fulitong International Trading Co., Note 2 Sales 377,013 Ltd. Franklin Management Ltd. Note 2 Subcontract 11,046,984 11 Revenue Fujin Precision Industrial (Jincheng) Co., Ltd. Note 2 Sales 1,074,007 1 Hongzhun Precision Tooling (Kunshan) Co., Ltd. Jizhun Precision Industry (Huizhou) Co., Ltd. Hongfujin Precision Industrial (Wuhan) Co., Ltd. Futaihua Industrial (Shenzhen) Limited Fuhuajie Industrial (Shenzhen) Limited Honfujin Precision Electronics (Chongqing) Co., Ltd. Hongfujing Precision Electronics (Tianjin) Co., Ltd. Hongfujin Precision Electronics (Chengdu) Limited NanNing FuGui Precision Industrial Co., Ltd. Futaihua Precision Electronics (Zhenzhou) Limited Hongfujin Precision Electronics (Zhenzhou) Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Futaihua Precision Electronics (Jiyuan) Limited Interface Technology (Chengdu) Co., Ltd. Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 10 Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales 285,394 490,660 210,217 10,784,469 707,849 155,927 104,120 3,944,111 395,918 662,044 2,221,685 457,662 904,100 234,138 11 1 4 1 2 1 Terms 90 days 120 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 30 days 60 days 90 days 90 days 90 days 90 days 90 days 30 days 30 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 1,053,441 4 233,522 2,188,020 726,532 86,364 342,537 53,423 2,996,182 626,068 77,795 101,384 2,351,974 318,769 471,664 1,373,925 397,375 741,040 101,304 1 8 3 1 11 2 8 1 2 5 1 3 -
180
Transactions Company Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Fu Ding Precision Component (Shenzhen) Co., Ltd. Fuhong Precision Component (Shenzhen) Co., Ltd. Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation Fu Ding Electronical Technology (Jiashan) Co., Ltd. Fu Ding Electronical Technology (Jiashan) Co., Ltd. Counterparty Innocom Technology (Shenzhen) Co., Ltd. Nanhai Chi Mei Electronics Corporation Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fuzhun Precision (Shenzhen) Industry Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fuhuigang Industrial (Shenzhen) Co., Ltd. Innolux Corporation Ltd. (Formerly Chimei Innolux Corporation) Beyond Maximum Industrial Ltd. Best Matrix Enterprises Ltd. Foxconn Precision Electronics (Lang Fang) Co., Ltd. Futaihua Industrial (Shenzhen) Limited Foxconn Technology Pte. Ltd. Foxconn Technology Co., Ltd. Fuyu Technology (Nanyang) Co., Ltd. Dongguan Pan-International Wire & Cable Co., Ltd. Futaihua Industrial (Shenzhen) Limited Foxconn Technology Pte. Ltd. Relationship with the Company Purchases /sales Note 6 Sales Note 6 Note 3 Note 3 Note 3 Note 3 Note 5 Note 2 Note 2 Note 2 Note 2 Note 3 Note 7 Note 3 Note 8 Note 2 Note 3 Sales Sales Sales Purchases Purchases Purchases Subcontract Revenue Subcontract Revenue Sales Sales Sales Sales Sales Purchases Sales Purchases Percentage of Amount purchases / sales Terms $ 170,109 90 days 162,670 332,422 246,561 1,711,515 148,887 188,638 8,801,240 585,039 120,510 550,577 2,449,477 594,552 119,438 127,007 2,719,222 210,845 16 1 2 97 99 3 12 52 13 3 4 27 3 90 days 90 days 90 days 90 days 90 days 90 days 30 days 30 days 90 days 90 days 30 days 30 days 90 days 90 days 90 days 90 days
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 21,713 1,589 35,613 116,336 ( 1,658,010) ( 28,220) 1,439,760 33,110 92,126 634,546 132,601 138,997 ( 63,871) 1,060,772 ( 16,238) ( ( ( ( 39) 1) 93 2 7 48 10 10 4) 37 1)
181
Transactions Company Fuhonyang Precision Industrial (Shenzhen) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Fuxiang Precision Industrial (Kunshan) Co., Ltd. Fuxiang Precision Industrial (Kunshan) Co., Ltd. Fuxiang Precision Industrial (Kunshan) Co., Ltd. Foxconn (Kunshan) Computer Connector Co., Ltd. Foxconn (Kunshan) Computer Connector Co., Ltd. Foxconn (Kunshan) Computer Connector Co., Ltd. Counterparty MWM Co., Ltd. Ambit Microsystem (Shanghai) Co., Ltd. Qunkang Precision Component (Kunshan) Co., Ltd. Tripleheads International Ltd. Fusing International Inc. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Innolux Corporation Ltd. (Formerly Chimei Innolux Corporation) Foxconn Technology Pte. Ltd. Pan International Industrial Co. Smart Top International Ltd. Foxconn Technology Pte. Ltd. IRIS World Enterprises Ltd. Foxconn Electronic Industrial Development (Kunshan) Co., Ltd. Success Rise Enterprises Ltd. Fuzhun Precision (Shenzhen) Industry Co., Ltd. Relationship with Percentage of the Company Purchases /sales Amount purchases / sales Terms Note 2 Subcontract $ 2,916,390 98 60 days Revenue Note 2 Note 2 Note 2 Note 2 Note 2 Note 5 Note 3 Note 7 Note 2 Note 3 Note 4 Note 2 Note 2 Note 3 Note 2 Sales Sales Sales Sales Sales Purchases Purchases Purchases Sales Purchases Purchases Sales Subcontract Revenue Purchases Subcontract Revenue 286,034 124,073 746,703 323,496 120,520 534,641 580,718 289,257 548,841 327,945 175,724 684,936 13,351,462 381,014 8,899,679 1 1 4 2 1 4 4 2 3 1 1 5 94 3 97 30 days 60 days 90 days 90 days 30 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 60 days 30 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 1,550,134 82 62,885 116,933 496,611 319,167 134 ( ( ( 375,170) 230,266) 215,187) 255,196 ( 13,299) 1,106,416 1,379,694 ( 13,845) 3,309,438 ( ( ( 1 1 6 4 3) 2) 2) 11 36 46 79
Foxconn Electronic Industrial Foxconn (Kunshan) Computer Connector Development (Kunshan) Co., Ltd. Co., Ltd.
182
Transactions Company Counterparty Foxconn Electronic Industrial Foxsemicon Integrated Technology Development (Kunshan) Co., Ltd. (Shanghai) Inc. Qunkang Precision Component (Kunshan) Co., Ltd. Smart Top International Ltd. Relationship with the Company Purchases /sales Note 9 Purchases Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 3 Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Percentage of Amount purchases / sales Terms $ 352,258 2 30 days 4,158,372 1,534,356 5,045,426 15,617,564 353,621 7,723,017 12,029,829 702,648 183,224 208,860 3,951,529 2,982,792 2,707,971 4,147,488 146,674 4,941,655 3,597,602 230,798 74 1 13 6 10 1 3 95 16 14 22 1 1 90 days 90 days 90 days 60 days 60 days 60 days 60days 60 days 60 days 60days 90days 90 days 90 days 90 days 90 days 90 days 90 days 90 days
Notes and accounts receivable (payable) Percentage Balance of balance Note ($ 82,304) ( 2) 2,201,885 254,238 596,527 6,900,380 77,890 4,224,630 3,864,411 140,984 57,913 189,151 1,994,615 634,037 401,847 1,362,843 26,916 1,009,145 1,218,551 8,937 100 21 13 12 9 87 12 8 26 1 1 1 -
Competition Team Technology Ltd. Futaihua Precision Electronics (Zhenzhou) Limited Competition Team Technology Ltd. Hongfujin Precision Electronics (Zhenzhou) Limited Hightech Electronics Components Inc. Hightech Electronics Components Inc. Hightech Electronics Components Inc. Hightech Electronics Components Inc. Hightech Electronics Components Inc. Hightech Electronics Components Inc. Smart Top International Ltd. Smart Top International Ltd. Best Ever Industries Ltd. Best Ever Industries Ltd. Best Ever Industries Ltd. Best Ever Industries Ltd. Best Leap Enterprises Limited Best Leap Enterprises Limited Best Leap Enterprises Limited Foxconn Image & Printing Product Pte. Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Fusing International Inc. Pte. Ltd. Competition Team Ireland Limited Foxconn Japan Ltd. Foxconn Singapore Pte. Ltd. Hongye Precision Component (Kunshan) Co., Ltd. Competition Team Ireland Limited Futaihua Industrial (Shenzhen) Limited Hongfujin Precision Electronics (Chengdu) Limited Hongfujin Precision Electronics (Zhenzhou) Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Fusing International Inc. Pte. Ltd. Futaihua Industrial (Shenzhen) Limited. Foxconn Technology Pte. Ltd.
183
Transactions Company Skilltop Limited Skilltop Limited Skilltop Limited Skilltop Limited Tripleheads International Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Foxconn CZ S.R.O. Foxconn CZ S.R.O. Foxconn CZ S.R.O. Foxconn CZ S.R.O. Foxconn CZ S.R.O. Foxconn Global Services Division Foxconn Global Services Division Counterparty Foxconn Image & Printing Product Pte. Ltd. Fuhuajie Industrial (Shenzhen) Limited Fusing International Inc. Competition Team Ireland Limited Competition Team Ireland Limited Dragon Spirit Industries Ltd. Hongfujin Precision Industrial (Wuhan) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Universal Field International Limited Foxconn Technology Pte. Ltd. Pan Interation Industrial Co. IRIS World Enterprises Ltd. Honghuasheng Precision Electronics (YanTai) Co., Ltd. Foxconn Global Services Division S.R.O. Foxconn Rus, LLC Foxconn TR Teknoloji San. Ltd. Sti. Innolux Corporation (Formerly Chimei Innolux Corporation) CyberTAN Technology Inc. Foxconn CZ S.R.O. Foxconn Slovakia, SPOL. S R.O. Relationship with Percentage of the Company Purchases /sales Amount purchases / sales Terms Note 2 Sales $ 21,311,986 93 45 days Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 3 Note 7 Note 4 Note 8 Note 2 Note 2 Note 2 Note 5 Note 7 Note 2 Note 2 Note 2 Sales Sales Sales Sales Sales Sales Sales Sales Purchases Purchases Purchases Purchases Sales Sales Sales Purchases Purchases Sales Sales Sales 643,670 392,136 606,633 686,688 7,836,936 185,379 2,634,742 49,479,435 837,614 591,534 193,679 219,887 180,405 982,393 404,378 137,181 814,881 319,399 169,838 408,936 3 2 3 92 12 4 73 1 1 1 1 17 9 1 45 days 90 days 90 days 90 days 30 days 30 days 30 days 30 days 90 days 90 days 90 days 90 days 45 days 45 days 45 days 45 days 45 days 45 days 45 days 90 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 1,340,788 12 628,274 385,108 595,760 377,215 99,894 1,195,803 11,206,431 ( ( ( ( 137,974) 109,845) 18,425) 16,099) 29,967 133,665 338,972 ( 51,657) 72,834 396 127,276 ( ( 5 2 2 4 1 8 77 1) 1) 1 3 22 1
Fujin Precision Industrial (Jincheng) Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Co., Ltd.
184
Transactions Company Counterparty Fujin Precision Industrial (Jincheng) Fu Ding Electronical Technology (Jiashan) Co., Ltd. Co., Ltd. Fujin Precision Industrial (Jincheng) Hongzhun Precision Tooling (Kunshan) Co., Co., Ltd. Ltd. Fujin Precision Industrial (Jincheng) Futaihua Industrial (Shenzhen) Co., Ltd. Co., Ltd. Fujin Precision Industrial (Jincheng) Hongfujin Precision Electronics (Chengdu) Co., Ltd. Co., Ltd. Fujin Precision Industrial (Jincheng) Fu Ding Precision Electronics (Zhengzhou) Co., Ltd. Co., Ltd. Fujin Precision Industrial (Jincheng) Futaihua Industrial (Shenzhen) Co., Ltd. Co., Ltd. Fujin Precision Industrial (Jincheng) Hongfujin Precision Electronics (Zhengzhou) Co., Ltd. Co., Ltd. Fujin Precision Industrial (Jincheng) Fast Victor Limited Co., Ltd. Fujin Precision Industrial (Jincheng) WWW (Jincheng) Co., Ltd. Co., Ltd. Fujin Precision Industrial (Jincheng) MWM Co., Ltd. Co., Ltd. Fujin Precision Industrial (Jincheng) Foxconn Precision Electronics (Taiyuan) Co., Co., Ltd. Ltd. Fujin Precision Industrial (Jincheng) Futaihua Precision Electronics (Jiyuan) Co., Ltd. Limited Fujin Precision Industrial (Jincheng) Hongfujin Precision Electronics (Taiyuan) Co., Ltd. Co., Ltd. Hongzhun Precision Tooling (Shenzhen) Co., Ltd. Hongzhun Precision Tooling (Kunshan) Co., Ltd. Hongzhun Precision Tooling (Kunshan) Co., Ltd. Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Fu Ding Electronical Technology (Jiashan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Relationship with the Company Purchases /sales Note 2 Sales Note 2 Note 2 Sales Sales Percentage of Amount purchases / sales Terms $ 156,962 90 days 463,492 2,664,247 1 8 90 days 90 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 29,219 808,655 5
Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 3 Note 2 Note 2 Note 2
Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Subcontract Revenue Sales Sales
1,652,473 750,677 1,742,470 11,039,566 2,880,209 674,156 1,049,255 977,942 2,959,965 2,025,198 120,888 1,330,069 3,571,283
5 2 5 34 9 2 3 3 9 6 100 16 43
90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 30 days 90 days
500,820 1,338 1,286,241 8,510,137 135,647 293,875 577,395 218,615 2,271,853 2,113,040 45,476 426,221 4,465,913
3 7 49 1 2 3 1 13 12 97 6 66
185
Transactions Company Hongzhun Precision Tooling (Kunshan) Co., Ltd. Hongzhun Precision Tooling (Kunshan) Co., Ltd. Hongzhun Precision Tooling (Kunshan) Co., Ltd. Hongzhun Precision Tooling (Kunshan) Co., Ltd. Hongzhun Precision Tooling (Kunshan) Co., Ltd. Foxconn EMS Inc. PCE Technology Inc. PCE Technology Inc. QHUB Logistics Corporation Shenzhen Fuhongjie Technology Service Co., Ltd. Counterparty Fuxiang Precision Industrial (Kunshan) Co., Ltd. Foxconn (Kun Shan) Computer Connector Co., Ltd. Futaihua Industrial (Shenzhen) Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. Hongfujin Precision Industry (Taiyuan) Co., Ltd. Carston Ltd. Heroic Legend Enterprises Ltd. Franklin Management Ltd. Foxconn / Hon Hai Logistics Texas LLC. Carston Ltd. Relationship with the Company Purchases /sales Note 2 Sales Note 2 Note 2 Note 2 Note 3 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Sales Sales Sales Sales Sales Sales Sales Sales Subcontract Revenue Sales Sales Sales Sales Subcontract Revenue Sales Sales Sales Sales Percentage of Amount purchases / sales Terms $ 660,066 8 90 days 911,413 603,906 406,535 159,738 174,306 168,736 113,274 158,786 668,687 1,538,726 101,604 760,590 493,764 10,321,071 146,343 105,096 125,083 99,499,196 11 7 5 2 14 5 5 54 72 61 17 60 39 100 37 2 6 93 90 days 60 days 90 days 90 days 30 days 30 days 30 days 7 days 30 days 90 days 90 days 30 days 30 days 30 days 30 days 45 days 60 days 60 days
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 61,562 1 306,797 77,569 216,215 32,607 34,898 35,194 29,534 74,249 511,480 22,571 743,467 383,858 3,224,509 28,509 16,719 3,337 7,243,984 5 1 3 9 21 27 73 54 15 64 33 87 33 1 1 89
Jizhun Precision Industry (Huizhou) Hongfujin Precision Industrial (Shenzhen) Co., Ltd. Co., Ltd. Shenzhen Fertile Plan International NanNing FuGui Precision Industrial Co., Ltd. Logistics Co., Ltd. Fuzhun Precision Tooling (Huaian) Fuyu Electronical Technology (Huaian) Co., Co., Ltd. Ltd. Fuzhun Precision Tooling (Huaian) Huaian Fulitong Trading Co., Ltd. Co., Ltd. Fuyu Electronical Technology (Huaian) Co., Ltd. Funing Precision Component Co., Ltd. Foxconn Baja California S.A. De C.V. Hongfujin Precision Industrial (Wuhan) Co., Ltd. Success Rise Enterprises Ltd.
PCE Paragon Solutions (USA) Inc. PCE Paragon Solutions Kft. FIH (Hong Kong) Limited Competition Team Ireland Limited Top Step Enterprises Limited
186
Transactions Company Hongfujin Precision Industrial (Wuhan) Co., Ltd. Hongfujin Precision Industrial (Wuhan) Co., Ltd. Hongfujin Precision Industrial (Wuhan) Co., Ltd. Hongfujin Precision Industrial (Wuhan) Co., Ltd. Hongfujin Precision Industrial (Wuhan) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Counterparty Hongfujin Precision Electronics (Chongqing) Co., Ltd. FTP Technology Inc. Foxconn Technology Co., Ltd. IRIS World Enterprises Limited Pan International Industrial Co. AMB Logistics Ltd. Futaijing Precision Electronics (Beijing) Co., Ltd. Futaijing Precision Electronics (Yantai) Co., Ltd. Competition Team Technology Pte. Ltd. Hongfutai Precision Electrons(Yantai) Co., Ltd. Full Profit International Limited Universal Field International Limited Foxconn Precision Electronics (Yantai) Co., Ltd. YanTai FuHuaDa Precision Electronics Co., Ltd. NanNing FuGui Precision Industrial Co., Ltd. Competition Team Ireland Limited Relationship with the Company Purchases /sales Note 2 Sales Note 3 Note 3 Note 4 Note 7 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Purchases Purchases Purchases Purchases Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Percentage of Amount purchases / sales Terms $ 301,164 90 days 949,174 743,063 2,249,818 1,025,533 1,169,018 7,957,826 2,430,262 3,429,823 1,521,568 1,008,692 107,086,065 424,816 5,059,763 137,491 867,633 1 1 1 1 4 1 2 1 48 2 30 days 90 days 90 days 90 days 60 days 45 days 90 days 30 days 90 days 30 days 30 days 90 days 90 days 90 days 90 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 ( ( ( (
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 289,208) 215,388) 174,127) 237,155) 872,992 1,046,516 2,406,492 914,768 850,198 254,515 6,581,778 75,444 3,085,985 126,927 31,963 ( ( ( ( 2) 1) 1) 1) 3 3 7 3 3 1 20 9 -
187
Transactions Company Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Falcon Precision Trading Limited Falcon Precision Trading Limited Universal Field International Limited Universal Field International Limited Top Step Enterprises Limited Top Step Enterprises Limited Foxconn Technology CZ S. R. O. Foxconn Technology CZ S. R. O. FuYu Energy Technology (Kunshan) Co., Ltd. Fugion Material Technology (Shenzhen) Limited Fugion Material Technology (Shenzhen) Limited Fugion Material Technology (Shenzhen) Limited Counterparty Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Pan International Industrial Co. IRIS World Enterprises Limited Innolux Corporation (Formerly Chimei Innolux Corporation) Fusing International Inc. Hongfujin Precision Electronics (Chengdu) Limited Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Industry (Yantai) Co., Ltd. Hongfujin Precision Industrial (Wuhan) Co., Ltd. Foxconn Image & Printing Product Pte. Ltd. Innolux Corporation (Formerly Chimei Innolux Corporation) Innolux Corporation (Formerly Chimei Innolux Corporation) Hongfujin Precision Industrial (Wuhan) Co., Ltd. Fu Ding Precision Component (Shenzhen) Co., Ltd. Fuhong Precision Component (Shenzhen) Co., Ltd. Fu Ding Precision Component (Zhengzhou) Co., Ltd. Relationship with Percentage of the Company Purchases /sales Amount purchases / sales Terms Note 7 Sales $ 76,108,306 34 30 days Note 7 Note 7 Note 4 Note 5 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 5 Note 5 Note 2 Note 2 Note 2 Note 2 Purchases Purchases Purchases Purchases Sales Sales Sales Sales Sales Sales Sales Purchases Sales Sales Sales Sales 2,990,004 4,145,266 1,522,882 1,402,624 2,448,371 2,550,172 421,662 828,169 1,987,696 3,374,411 380,188 145,572 230,979 1,323,602 161,488 455,173 9 2 1 1 96 100 1 2 3 20 76 55 19 2 7 90 days 90 days 90 days 90 days 45 days 30 days 90 days 30 days 45 days 60 days 45 days 45 days 60 days 90 days 90 days 90 days
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 15,288,164 46 ( 2,054,799) ( 1,345,486) ( ( 50,437) 115,803) 2,180,795 282,498 156,972 178,852 603,873 256,098 316,888 ( 121,821) 268,752 195,898 26,932 59,077 ( ( ( 6) 4) 36 3 1 1 6 2 69 53) 48 44 6 13
188
Transactions Company Fugion Material Technology (Shenzhen) Limited Huaian Fulitong Trading Co., Ltd. Huaian Fulitong Trading Co., Ltd. Huaian Fulitong Trading Co., Ltd. Counterparty Fukui Precision Component (Shenzhen) Co., Ltd. Foxconn Precision Electronics (Lang Fang) Co., Ltd. Foxconn (Kunshan) Computer Connector Co., Ltd. Foxconn Electronic Industrial Development (Kunshan) Co., Ltd. Relationship with the Company Purchases /sales Note 4 Sales Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Percentage of Amount purchases / sales Terms $ 340,362 5 90 days 177,802 106,131 310,002 333,071 334,431 221,534 158,024 782,867,169 3,127,252 10,618,756 2,869,305 17,771,198 1,292,555 2,630,914 1,648,774 8 5 14 1 1 90 1 2 60 days 30 days 30 days 60 days 60 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days 90 days
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 58,031 13 69,987 91,749 192,997 186,355 114,378 25,033 131,860,729 3,643,963 3,952,654 1,102,065 7,326,521 1,473,771 1,937,113 1,084,734 9 12 26 3 83 2 3 1 5 1 1 1
Foxconn Image & Printing Product Fuhuajie Industrial (Shenzhen) Limited Pte. Ltd. Foxconn Image & Printing Product Honfujin Precision Electronics (Chongqing) Pte. Ltd. Co., Ltd. Futaihua Industrial (Shenzhen) Co., Hongfujin Precision Industry (Shenzhen) Co., Ltd. Ltd. Futaihua Industrial (Shenzhen) Co., Fu Ding Precision Component (Shenzhen) Ltd. Co., Ltd. Futaihua Industrial (Shenzhen) Co., Best Leap Enterprises Limited Ltd. Futaihua Industrial (Shenzhen) Co., Fujin Precision Industrial (Jincheng) Co., Ltd. Ltd. Futaihua Industrial (Shenzhen) Co., Hongfujin Precision Electronics (Chengdu) Ltd. Co., Ltd. Futaihua Industrial (Shenzhen) Co., Futaihua Precision Electronics (Zhengzhou) Ltd. Co., Ltd. Futaihua Industrial (Shenzhen) Co., Hongfujin Precision Electronics (Zhengzhou) Ltd. Co., Ltd. Futaihua Industrial (Shenzhen) Co., Foxconn Precision Electronics (Taiyuan) Co., Ltd. Ltd. Futaihua Industrial (Shenzhen) Co., Futaihua Precision Electronics (Jiyuan) Ltd. Limited Futaihua Industrial (Shenzhen) Co., Fuhong Precision Component (Bac Giang) Ltd. Limited
189
Transactions Company Counterparty Futaihua Industrial (Shenzhen) Co., Foxconn CMMSG Industria De Eletronicos Ltd. Ltd. Futaihua Industrial (Shenzhen) Co., Nanning Funing Precision Electronics Co., Ltd. Ltd. Futaihua Industrial (Shenzhen) Co., Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Ltd. Futaihua Industrial (Shenzhen) Co., Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Ltd. Futaihua Industrial (Shenzhen) Co., Foxconn Technology Pte. Ltd. Ltd. Futaihua Industrial (Shenzhen) Co., Fuzhun Precision (Shenzhen) Industry Co., Ltd. Ltd. Futaihua Industrial (Shenzhen) Co., Innolux Corporation (Formerly Chimei Ltd. Innolux Corporation) Futaihua Industrial (Shenzhen) Co., IRIS World Enterprises Limited Ltd. Fuhuajie Industrial (Shenzhen) Limited Fuhuajie Industrial (Shenzhen) Limited Fuhuajie Industrial (Shenzhen) Limited Fuhuajie Industrial (Shenzhen) Limited Fuhuajie Industrial (Shenzhen) Limited Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Skilltop Limited Foxconn Image & Printing Product Pte. Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Pan-International Industrial Co. IRIS World Enterprises Limited Ambit Microsystem (Shanghai) Co., Ltd. HighTech Electronics Components Inc. Fujun Precision Electronics (Chongqing) Co., Ltd. Relationship with the Company Purchases /sales Note 2 Sales Note 3 Note 3 Note 3 Note 3 Note 3 Note 5 Note 4 Note 2 Note 2 Note 2 Note 7 Note 4 Note 2 Note 2 Note 2 Purchases Sales Purchases Purchases Purchases Purchases Purchases Sales Sales Sales Purchases Purchases Sales Sales Sales Percentage of Amount purchases / sales Terms $ 2,298,167 90 days 198,286 472,196 1,305,912 1,684,472 662,652 202,158 8,335,077 22,863,975 409,864 4,001,810 258,965 546,415 696,385 121,082,335 5,256,778 1 1 1 7 45 1 8 6 13 84 4 90 days 90 days 90 days 90 days 90 days 30 days 90 days 90 days 30 days 90 days 90 days 90 days 60 days 60 days 30 days
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 1,127,182 1 140,282 ( ( ( 462,123) 336,565) 215,125) ( 1,810,394) 2,683,902 186,758 3,238,990 ( ( 10,918) 14,507) 7,563 29,666,431 2,161,370 ( 1) 39 3 47 91 7
190
Transactions Company Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Foxconn Precision Electronics (Yantai) Co., Ltd. Foxconn Precision Electronics (Yantai) Co., Ltd. Foxconn Precision Electronics (Yantai) Co., Ltd. Foxconn Precision Electronics (Yantai) Co., Ltd. Chongqingshi Futaitong Logistics Limited Co., Limited Chongqingshi Futaitong Logistics Limited Co., Limited Hongfujin Precision Electronics (Tianjin) Co., Ltd. FuXun Tong Trading (ShenZhen) Co., Ltd. FuXun Tong Trading (ShenZhen) Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. Counterparty Innolux Corporation (Formerly Chimei Innolux Corporation) Innocom Technology (Shenzhen) Co., Ltd. Nanhai Chi Mei Electronics Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Pan-International Industrial Co. IRIS World Enterprises Limited FIH (Hong Kong) Limited Hongfujin Precision Electrons (Yantai) Co., Ltd. YanTai FuHuaDa Precision Electronics Limited Pan-International Industrial Co. Honfujin Precision Electronics (Chongqing) Co., Ltd. HongDaoFu (Chongqing) Technology Co., Ltd. Profit New Limited Futaihua Industrial (Shenzhen) Limited ZhengZhou XunFeng Trading Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Relationship with Percentage of the Company Purchases /sales Amount purchases / sales Terms Note 5 Purchases $ 2,428,314 6 90 days Note 6 Note 6 Note 3 Note 7 Note 4 Note 2 Note 2 Note 2 Note 7 Note 2 Note 7 Note 2 Note 2 Note 2 Note 2 Purchases Purchases Purchases Purchases Purchases Sales Sales Sales Purchases Sales Sales Sales Sales Sales Sales 303,488 104,539 356,964 243,592 1,102,450 521,485 715,291 1,056,579 118,386 296,486 200,052 16,427,949 140,708 143,806 125,062 1 13 18 26 4 54 37 67 5 4 60 days 60 days 30 days 60 days 60 days 60 days 90 days 45 days 90 days 30 days 60 days 90 days 90 days 90 days 30 days
Notes and accounts receivable (payable) Percentage Balance of balance Note ($ 13,410) ( ( ( ( ( 147,711) 14,773) 119,463) 80,885) 179,293) 69,165 169,201 ( 51,514) 163,850 53,229 3,435,836 18,051 14,424 44,899 ( 11 28 11) 71 23 84 5 4 -
191
Transactions Company Hongfujin Precision Electronics (Chengdu) Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. Futaihua Precision Electronics (Chengdu) Limited Futaihua Precision Electronics (Chengdu) Limited Fu Ding (Zhengzhou) Precision Industry Co., Ltd. Fu Ding (Zhengzhou) Precision Industry Co., Ltd. Fu Ding (Zhengzhou) Precision Industry Co., Ltd. Fu Ding (Zhengzhou) Precision Industry Co., Ltd. Fu Ding (Zhengzhou) Precision Industry Co., Ltd. Fujun Precision Electronics (Chongqing) Co., Ltd. Fujun Precision Electronics (Chongqing) Co., Ltd. YanTai FuHuaDa Precision Electronics Limited YanTai FuHuaDa Precision Electronics Limited Anpinda Precision Industrial (Huizhou) Co., Ltd. Counterparty Falcon Precision Trading Limited Futaihua Industrial (Shenzhen) Limited Foxconn Technology Pte. Ltd. IRIS World Enterprises Limited Hongfujin Precision Electronics (Chengdu) Limited Interface Technology (Chengdu) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Futaihua Precision Electronics (Zhenzhou) Limited Hongfujin Precision Electronics (Zhenzhou) Limited Futaihua Precision Electronics (Jiyuan) Limited Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fuhuajie Industrial (Shenzhen) Limited Innocom Technology (Chongqing) Co., Ltd. Universal Field International Limited FuXun Tong Trading(ShenZhen) Co., Ltd. Glorious Prospect Enterprises Ltd. Relationship with the Company Purchases /sales Note 2 Sales Note 2 Note 3 Note 4 Note 2 Note 10 Note 2 Note 2 Note 2 Note 2 Note 3 Note 2 Note 2 Note 2 Note 2 Note 2 Sales Purchases Purchases Sales Sales Sales Sales Sales Sales Sales Sales Purchases Sales Sales Sales Percentage of Amount purchases / sales Terms $ 2,546,681 90 days 19,590,798 367,178 4,058,727 2,416,964 252,353 102,075 101,146 180,100 582,468 424,521 548,042 534,961 7,593,657 185,809 22,504,978 2 86 9 7 7 13 42 31 10 10 58 1 100 90 days 90 days 90 days 90 days 30 days 90 days 90 days 90 days 90 days 90 days 45 days 30 days 30 days 90 days 90 days
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 284,989 4,540,794 ( ( 107,699) 935,341) 1,311,037 222,330 118,767 99,820 177,392 677,721 493,945 637,666 ( 282,846) 1,165,314 216,195 4,860,952 ( ( 5 1) 79 13 8 6 11 43 32 38 1) 45 8 98
192
Transactions Company System Integration Electronics (Hangzhou) Co., Ltd. Wang Hui Trading Co., Ltd. Counterparty Ambit Microsystem (Shanghai) Co., Ltd. Kantron International Trading (Shenzhen) Co., Ltd. Relationship with the Company Purchases /sales Note 2 Sales Note 2 Note 2 Note 2 Note 4 Note 2 Note 2 Note 2 Note 2 Note 3 Note 2 Note 2 Note 2 Note 2 Note 3 Note 3 Sales Sales Sales Purchases Sales Sales Sales Sales Purchases Sales Sales Sales Sales Purchases Purchases Percentage of Amount purchases / sales Terms $ 320,577 7 45 days 163,823 282,368 23,123,969 975,134 1,575,267 8,410,066 7,683,619 2,020,969 296,523 528,064,023 10,712,805 2,288,141 37,285,491 2,132,588 612,418 40 1 97 25 8 43 39 10 3 91 2 6 2 1 30 days 60 days 60 days 90 days 90 days 90 days 90 days 90 days 30 days 90 days 90 days 90 days 90 days 90 days 90 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 ( ( (
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 33,916 7 113,753 309,727 6,269,967 38,904 5,254,452 2,091,461 914,597 126,247) 126,198,176 6,418,015 723,523 12,043,997 637,671) 226,097) ( 83 5 94 63 25 11 2) 87 4 8 -
NanNing FuGui Precision Industrial Hongfujin Precision Industry (Shenzhen) Co., Co., Ltd. Ltd. NanNing FuGui Precision Industrial Mega Well Limited Co., Ltd. NanNing FuGui Precision Industrial IRIS World Enterprises Limited Co., Ltd. Futaihua Precision Electronics (Zhengzhou) Limited Futaihua Precision Electronics (Zhengzhou) Limited Futaihua Precision Electronics (Zhengzhou) Limited Futaihua Precision Electronics (Zhengzhou) Limited Futaihua Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Competition Team Technologies Limited Futaihua Industrial (Shenzhen) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Competition Team Technologies Limited Futaihua Industrial (Shenzhen) Limited Futaihua Precision Electronics (Zhengzhou) Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Foxconn Technology Pte. Ltd.
193
Transactions Company Hongfujin Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited ZhengZhou XunFeng Trading Co., Ltd. ZhengZhou XunFeng Trading Co., Ltd. Fusing International Inc. Fusing International Inc. Fusing International Inc. Counterparty Pan-International Industrial Co. IRIS World Enterprises Limited Futaihua Precision Electronics (Zhengzhou) Limited Relationship with the Company Purchases /sales Note 7 Purchases Note 4 Note 2 Note 2 Note 6 Note 6 Note 5 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 5 Note 2 Note 5 Note 2 Note 2 Note 2 Note 2 Note 2 Purchases Sales Sales Sales Purchases Purchases Sales Sales Sales Sales Sales Sales Sales Sales Sales Purchases Sales Sales Sales Sales Sales Percentage of Amount purchases / sales Terms $ 230,777 90 days 6,880,474 887,853 11,282,306 753,157 471,928 2,067,170 3,796,784 272,605 1,607,783 479,025 177,579 10,387,851 1,390,779 1,660,185 2,236,542 4,582,419 101,597 322,111 719,262 304,077 346,107 6 7 93 7 4 17 100 86 100 1 17 2 3 4 10 3 8 18 8 9 90 days 90 days 90 days 90 days 60 days 45 days 30 days 60 days 45 days 45 days 60 days 60 days 60 days 60 days 90 days 60 days 90 days 90 days 90 days 60 days 90 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note ($ 140,257) ( 3,312,462) 496,703 2,010,346 100,054 46,987) 1,160,881 3,273 114,887 37,683 73,423 3,316,751 329,013 25,538 275,733 ( 1,092,306) 36,061 242,188 341,383 44,260 29,773 ( ( 2) 20 80 3 1) 100 100 100 1 37 4 3 13) 3 23 33 4 3
Hongfujin Precision Electronics (Zhengzhou) Limited Innolux Corporation Ltd. Innolux Corporation Ltd. Innolux Corporation (Formerly Chimei Innolux Corporation) ChengDu XunFeng Trading Co., Ltd. Hongfujin Precision Electronics (Chengdu) Limited ChongQing HongFuZhun Trading Hongfujin Precision Electronics (Chongqing) Co., Ltd. Co., Ltd. HongZhaoDa Integrated Innovative Smart Top International Ltd. Service (Kunshan) Co., Ltd. Competition Team Ireland Limited Foxconn CZ S.R.O. Competition Team Ireland Limited Fuhuajie Industrial (Shenzhen) Limited Competition Team Ireland Limited Hongfujin Precision Electronics (Chongqing) Co., Ltd. Competition Team Ireland Limited Fusing International Inc. Competition Team Ireland Limited Competition Team Ireland Limited Competition Team Ireland Limited WWW (Jincheng) Co., Ltd. WWW (Jincheng) Co., Ltd. WWW (Jincheng) Co., Ltd. WWW (Jincheng) Co., Ltd. WWW (Jincheng) Co., Ltd. Innolux Corporation (Formerly Chimei Innolux Corporation) Innocom Technology (Chongqing) Co., Ltd. Innolux Corporation (Formerly Chimei Innolux Corporation) Foxconn (Tianjin) Precision Industry Co., Ltd Hongfujin Precision Industry (Shenzhen) Co., Ltd. Fuhonyang Precision Industrial (Shenzhen) Co., Ltd. Best Ever Industries Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd.
194
Transactions Company Fortune Co., Ltd. MWM Co., Ltd. Mexus Solutions Inc. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Counterparty Best Ever Industries Ltd. Best Ever Industries Ltd. Franklin Management Ltd. Futaihua Industrial (Shenzhen) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Fast Victor Limited Foxconn CMMSG Industria De Eletronicos Ltda. IRIS World Enterprises Limited Relationship with the Company Purchases /sales Note 2 Sales Note 2 Note 2 Note 2 Note 2 Note 2 Note 2 Note 4 Note 2 Note 2 Note 2 Note 2 Note 2 Note 6 Note 2 Note 2 Note 2 Note 2 Note 5 Note 3 Note 2 Sales Sales Sales Sales Sales Sales Purchases Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Purchases Purchases Sales Percentage of Amount purchases / sales Terms $ 199,921 100 90 days 4,017,106 126,569 15,920,413 8,694,459 95,486,777 1,322,984 660,552 2,353,028 341,145 14,077,244 614,146 534,961 1,661,558 1,509,474 387,505 231,990 125,782 152,173 264,749 3,242,771 100 59 13 7 79 1 100 2 97 72 11 34 31 8 5 2 2 4 30 90 days 30 days 90 days 90 days 90 days 90 days 90 days 7 days 90 days 90 days 60 days 90 days 90 days 60 days 30 days 30 days 90 days 90 days 90 days 45 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 146,993 100 2,041,392 25,132 6,779,289 5,672,591 26,224,472 1,307,447 72,495 338,551 4,668,016 604,953 282,847 89,158 1,723 13,260 16,484 ( 125,159) 361,939 ( 98 65 8 7 33 2 3 7 92 51 67 21 1 11 1 8) 20
Scientific-Atlanta de Mexico S de R. Competition Team Ireland Limited L. de C. V. Futaihua Precision Electronics (Jiyuan) Limited Futaihua Precision Electronics (Jiyuan) Limited Ambit Microsystems Corporation Limited Innocom Technology (Chongqing) Co., Ltd. Innocom Technology (Chongqing) Co., Ltd. Innocom Technology (Chongqing) Co., Ltd. NSG Technology Inc. NSG Technology Inc. Foxconn Japan Ltd. Foxconn Japan Ltd. Foxconn Japan Ltd. Foxconn Singapore Pte. Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Hongfujin Precision Electronics (Zhenzhou) Limited Ambit Microsystems (Zhong shan) Corporation Fujun Precision Electronics (Chongqing) Co., Ltd. Lakers Trading Ltd. Hightech Electronics Components Inc. Heroic Legend Enterprises Ltd. Competition Team Ireland Limited Beyond Maximum Industrial Ltd. Innolux Corporation (Formerly Chimei Innolux Corporation) Foxconn Technology Pte. Ltd. Foxconn TR Teknoloji San. Ltd.
195
Transactions Company Counterparty Premier Image Technology (China) Hongfujin Precision Electrons (Yantai) Co., Ltd. Ltd. Premier Image Technology (China) Jumbo Rise Management Limited Ltd. Premier Image Technology (China) Foxconn MOEBG Industria de Eletronicos Ltd. Ltda. Premier Image Technology (China) Innolux Corporation (Formerly Chimei Ltd. Innolux Corporation) Premier Image Technology (China) Pan International Industry Co., Ltd. Ltd. Premier Image Technology (China) Dongguan Pan-International Wire & Cable Ltd. Co., Ltd. Premier Image Technology (China) IRIS World Enterprises Limited Ltd. Foxconn Slovakia, SPOL. S R.O. Foxconn Slovakia, SPOL. S R.O. Fuhong Precision Component (Bac Giang) Limited Foxconn RUS, LLC Chimei Optoelectronics (Singapore) Pte. Ltd. Funing Precision Component Co., Ltd. Relationship with the Company Purchases /sales Note 2 Sales Note 2 Note 2 Note 5 Note 8 Note 8 Note 4 Note 2 Note 6 Note 2 Note 2 Note 2 Sales Sales Purchases Purchases Purchases Purchases Sales Purchases Sales Sales Sales Percentage of Amount purchases / sales Terms $ 1,410,490 5 90 days 23,826,813 236,089 899,628 1,090,595 233,363 169,879 229,105 694,970 207,307 1,051,604 455,019 84 1 12 15 3 2 74 9 4 76 1 90 days 90 days 60 days 90 days 90 days 90 days 60 days 60 days 60 days 90 days 90 days
Difference with general transactions Unit price Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Terms Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Notes and accounts receivable (payable) Percentage Balance of balance Note $ 575,733 8 4,996,287 42,641 ( ( ( ( 53,849) 388,910) 60,018) 37,356) 14,134 ( 108) 23,732 79,207 125,154 ( ( ( ( 67 1 1) 10) 2) 1) 25 2 67 2
Fenix Industria DE Eletronicos Ltda. Foxconn CMMSG Industria De Eletronicos Ltda. Foxconn CMMSG Industria De Eletronicos Ltda. Futaihua Industrial (Shenzhen) Limited
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 investee and the counterparty are both indirect subsidiaries of the Company. Note 3: The counterparty of the investee is an indirect subsidiary of FTC. Note 4: The counterparty of the investee is an indirect subsidiary of Zhen Ding Technology Holding Limited. Note 5: The Companys chairman is a major shareholder of the counterparty. Note 6: The counterparty of the investee is an indirect subsidiary of Innolux. Note 7: The counterparty of the investee is an investee of the Company accounted for under the equity method. Note 8: The counterparty of the investee is an indirect subsidiary of PIIC. Note 9: The counterparty of the investee is an indirect subsidiary of FITI. Note 10: The counterparty of the investee is an indirect investee of the Company accounted for under the equity method.
196
9) Receivable from related parties in excess of $100,000 or 20% of total contributed capital: please refer to information on significant transactions in Notes 11(1) and (2) and the following disclosures. Balance of Overdue receivables receivable Relationship with from related Turnover Action adopted for Company Counterparty the company parties rate Amount overdue accounts Ambit Microsystems (Zhong shan) Corporation Ambit Microsystems Corporation Limited Note 1 $ 1,299,771 5 $ Ambit Microsystem (Shanghai) Co., Ltd. AMB Logistics Ltd. Note 1 1,456,576 25 30,683 Subsequent collection Ambit Microsystem (Shanghai) Co., Ltd. Amworld Microsystems (Shanghai) Ltd. Note 1 186,276 5 11,204 Subsequent collection Ambit Microsystem (Shanghai) Co., Ltd. Foxconn Technology (India) Private Limited Note 1 123,279 2 20,831 Subsequent collection Ambit Microsystem (Shanghai) Co., Ltd. CyberTAN Technology Inc. Note 7 194,116 3 4,677 Subsequent collection Ingrasys Technology Co., Ltd. Ingrasys Technology USA Inc. Note 1 1,470,556 5 398,018 Subsequent collection Ingrasys Technology Co., Ltd. PCE Paragon Solutions KFT. Note 1 110,099 7 11,145 Subsequent collection Foxnum Technology Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Note 1 139,166 7 101,577 Subsequent collection FIH (Hong Kong) Limited Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Note 1 107,827 9 FIH (Hong Kong) Limited Chi Mei Communication System ,Inc. Note 1 1,083,664 5 FIH (Hong Kong) Limited Foxconn India Pvt. Ltd. Note 1 107,616 3 FIH (Hong Kong) Limited Sutech Industry Inc. Note 1 492,850 3 FIH (Hong Kong) Limited Foxconn Precision Electronics (Langfang) Co., Ltd. Note 1 148,297 2 FIH (Hong Kong) Limited Futaihua Industrial (Shenzhen) Limited Note 1 129,558 3 Shenzhen Fu Tai Hong Precision Industry Co., Ltd. FIH (Hong Kong) Limited Note 1 192,756 2 Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Note 1 682,907 1 Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Nanning Futaihong Precision Electronics Co., Ltd. Note 1 759,974 3 Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Note 1 184,701 2 Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Futaihua Industrial (Shenzhen) Limited Note 1 163,982 2 Foxconn Precision Component (Beijing) Co., Ltd. Foxconn (Tianjin) Precision Industry Co., Ltd. Note 1 163,709 3 Foxconn Precision Component (Beijing) Co., Ltd. Futaijing Precision Electronics (Beijing) Co., Ltd. Note 1 167,795 1 Foxconn (Tianjin) Precision Industry Co., Ltd. FIH (Hong Kong) Limited Note 1 518,907 7 Futaijing Precision Electronics (Beijing) Co., Ltd. Foxconn Precision Component (Beijing) Co., Ltd. Note 1 183,779 2 Futaijing Precision Electronics (Beijing) Co., Ltd. Foxconn Precision Electronics (Langfang) Co., Ltd. Note 1 202,857 3 Foxconn Precision Electronics (Langfang) Co., Ltd. FIH (Hong Kong) Limited Note 1 746,307 11 Foxconn Precision Electronics (Langfang) Co., Ltd. ShenZhen Fu Tai Hong Precision Industry Co., Ltd. Note 1 140,273 1 Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn Precision Component (Beijing) Co., Ltd. Note 1 1,026,944 2 Foxconn Precision Electronics (Langfang) Co., Ltd. Foxconn (Tianjin) Precision Industry Co., Ltd. Note 1 234,987 2 Foxconn Precision Electronics (Langfang) Co., Ltd. Futaijing Precision Electronics (Beijing) Co., Ltd. Note 1 112,966 2 Foxconn Precision Electronics (Langfang) Co., Ltd. Eliteday Enterprises Limited Note 1 142,851 12 Eliteday Enterprises Limited Foxconn Precision Electronics (Langfang) Co., Ltd. Note 1 366,772 2 -
Subsequent collection $1,299,771 728,409 186,276 23,728 156,147 398,000 11,142 101,091 213 759,216 62,662 492,850 134,979 106,560 31,132 51,809 193,953 175,389 163,982 77,320 93,907 518,907 145,867 119,785 746,307 92,677 140,743 106,748 93,450 142,851 192
Allowance for doubtful accounts provided $ -
197
Company Nanning Futaihong Precision Industry Co., Ltd Futaijing Precision Electronics (Yantai) Co., Ltd. Futaijing Precision Electronics (Yantai) Co., Ltd. Carston Ltd. Carston Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Fu Ding Precision Component (Shenzhen) Co., Ltd.
Counterparty Shenzhen Fu Tai Hong Precision Industry Co., Ltd FIH (Hong Kong) Limited Futaijing Precision Electronics (Beijing) Co., Ltd. Lakers Trading Ltd. IRIS World Enterprises Limited Shenzhen Fu Tai Hong Precision Industry Co., Ltd Carston Ltd. Fu Ding Precision Component (Shenzhen) Co., Ltd Kangzhun Electronic Technology (Kunshan) Co., Ltd. Foxconn Electronic Industrial Development (Kunshan) Co., Ltd Heroic Legend Enterprises Ltd. Yantaishi Fulitong International Trading Co., Ltd. Franklin Management Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Jizhun Precision Industry (Huizhou) Co., Ltd. Futaihua Industrial (Shenzhen) Limited Fuhuajie Industrial (Shenzhen) Limited Hongfujin Precision Industry (Tianjin) Co., Ltd. Hongfujin Precision Electronics (Chengdu) Limited NanNing FuGui Precision Industrial Co., Ltd Futaihua Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited WWW (Jincheng) Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Futaihua Precision Electronics (Jiyuan) Limited Interface Technology (Chengdu) Co., Ltd. Interface Optoelectronics (SZ) Co., Ltd Fuzhun Precision (Shenzhen) Industry Co., Ltd Beyond Maximum Industrial Limited
Relationship with the company Note 1 Note 1 Note 1 Note 2 Note 2 Note 2 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 4 Note 1
Balance of receivable from related parties $ 860,295 421,475 1,657,101 1,040,837 157,711 124,028 283,725 1,254,847 119,083 110,126 1,053,441 233,522 2,188,020 726,532 342,537 2,996,182 626,068 101,384 2,351,974 318,769 471,664 1,373,925 200,229 397,375 741,040 101,304 124,920 116,336 1,439,760
Overdue receivables Turnover rate 3 6 3 1 3 2 8 2 2 3 7 1 10 1 3 4 2 1 3 2 2 2 2 2 5 1 4 24 Action adopted for overdue accounts Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection $ 235,179 421,475 1,237,984 32,898 60,873 1,254,847 109,166 108,224 219,062 392,783 156,105 331 280,839 36,478 4,307 1,118,144 406 89,655 559,312 196,280 154,033 42,649 23,937 1,439,760
Amount $ 845,278 37 287 2,241
16,592 Subsequent collection 16,556 5,047 75,648 38,010 5,295 27 5,330 10,322 28,537 57,526 183,198 16,952 11,095 21,502 21,607 2,282 Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection -
198
Company Counterparty Champ Tech Optical (Foshan) Corporation Foxconn Technology Pte. Ltd. Champ Tech Optical (Foshan) Corporation Fuyu Technology (Nanyang) Co., Ltd. Champ Tech Optical (Foshan) Corporation Foxconn Technology Co., Ltd. Fu Ding Electronical Technology (Jiashan) Co., Ltd. Futaihua Industrial (Shenzhen) Limited Fuhonyang Precision Industrial (Shenzhen) Co., MWM Co., Ltd. Ltd. Kangzhun Electronic Technology (Kunshan) Co., Fu Ding Electronical Technology (Jiashan) Co., Ltd. Ltd. Kangzhun Electronic Technology (Kunshan) Co., Qunkang Precision Component (Kunshan) Co., Ltd. Ltd. Kangzhun Electronic Technology (Kunshan) Co., Tripleheads International Ltd. Ltd. Kangzhun Electronic Technology (Kunshan) Co., Fusing International Inc. Fuxiang Precision Industrial (Kunshan) Co., Ltd. Smart Top International Ltd. Ltd. Foxconn (Kunshan) Computer Connector Co., Ltd. Foxconn Electronic Industrial Development (Kunshan) Co., Ltd. Foxconn (Kunshan) Computer Connector Co., Ltd. Success Rise Enterprise Limited Foxconn Electronic Industrial Development Foxconn (Kunshan) Computer Connector Co., Ltd. (Kunshan) Co., Ltd. Qunkang Precision Component (Kunshan) Co., Ltd. Smart Top International Ltd. Competition Team Technology Pte. Ltd. Futaihua Precision Electronics (Zhengzhou) Limited Competition Team Technology Pte. Ltd. Hongfujin Precision Electronics (Zhengzhou) Limited Hightech Electronics Components Inc. Foxconn Image & Printing Product Pte. Ltd. Hightech Electronics Components Inc. Fusing International Inc. Hightech Electronics Components Inc. Competition Team Ireland Limited Hightech Electronics Components Inc. Foxconn Japan Ltd. Smart Top International Ltd. Hongye Precision Component (Kunshan) Co., Ltd. Smart Top International Ltd. Competition Team Ireland Limited Best Ever Industries Ltd. Futaihua Industrial (Shenzhen) Limited Best Ever Industries Ltd. Hongfujin Precision Electronics (Chengdu) Limited
Relationship with the company Note 4 Note 4 Note 7 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Balance of receivable from related parties $ 634,546 138,997 132,601 1,060,772 1,550,134 246,810 116,933 496,611 319,167 255,196 1,106,416 1,379,694 3,309,438 2,201,885 254,238 596,527 6,900,380 4,224,630 3,864,411 140,984 189,151 1,994,615 634,037 401,847
Overdue receivables Turnover rate 5 2 5 4 17 2 2 10 3 2 6 4 4 6 10 1 2 5 7 Action adopted for Amount overdue accounts $ 392,871 Subsequent collection 134,596 Subsequent collection 77,254 Subsequent collection Subsequent collection $ 516,947 131,052 138,943 6,292 2,085 135,268 30,695 2,313,712 395,504 2,366,722 452,759 1,903 -
10,299 Subsequent collection 137,772 Subsequent collection 70,632 Subsequent collection 255,196 Subsequent collection 1,068,116 Subsequent collection -
596,003 Subsequent collection 13,619 81,499 15,591 66 118,298 528,048 Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection -
199
Company Best Ever Industries Ltd. Best Leap Enterprises Limited Best Leap Enterprises Limited Skilltop Limited Skilltop Limited Skilltop Limited Skilltop Limited Skilltop Limited Tripleheads International Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Foxconn CZ S.R.O. Foxconn CZ S.R.O. Fujin Precision Industrial (Jincheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Fujin Precision Industrial (Jincheng) Co., Ltd. Hongzhun Precision Tooling (Kunshan) Co., Ltd. Hongzhun Precision Tooling (Kunshan) Co., Ltd. Hongzhun Precision Tooling (Kunshan) Co., Ltd. Hongzhun Precision Tooling (Kunshan) Co., Ltd.
Counterparty Hongfujin Precision Electronics (Zhengzhou) Limited Fusing International Inc. Futaihua Industrial (Shenzhen) Limited Foxconn Image & Printing Product Pte. Ltd. Fuhuajie Industrial (Shenzhen) Limited Honfujin Precision Electronics (Chongqing) Co., Ltd. Fusing International Inc. Competition Team Ireland Limited Competition Team Ireland Limited Universal Field International Limited Hongfujin Precision Industry (Yantai) Co., Ltd. Foxconn RUS, LLC Foxconn TR Teknoloji San. Ltd. Sti. Hongfujin Precision Electronics (Shenzhen) Co., Ltd. Futaihua Industrial (Shenzhen) Limited Hongfujin Precision Electronics (Chengdu) Co., Ltd. Futaihua Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Co., Ltd. Fast Victor Limited WWW (Jincheng) Co., Ltd. MWM Co., LTD. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Futaihua Precision Electronics (Jiyuan) Limited Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fu Ding Electronical Technology (Jiashan) Co., Ltd. Kangzhun Electronic Technology (Kunshan) Co., Ltd. Foxconn (Kunshan) Computer Connector Co., Ltd. Foxconn Electronic Industrial Development (Kunshan) Co., Ltd.
Relationship with the company Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 4 Note 1 Note 1 Note 1 Note 1
Balance of receivable from related parties $ 1,362,843 1,009,145 1,218,551 1,340,788 628,274 199,399 385,108 595,760 377,215 11,206,431 1,195,803 133,665 338,972 127,276 808,655 500,820 1,286,241 8,510,137 135,647 293,875 577,395 218,615 2,271,853 2,113,040 426,221 4,465,913 306,797 870,557
Overdue receivables Turnover rate 6 3 12 5 3 2 2 2 6 2 5 2 4 5 7 2 2 42 1 2 2 3 2 2 1 4 Action adopted for overdue accounts Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection -
Amount $ 46,997 41,657 1,976,784 1,714 194,852 140,977 -
Allowance for doubtful Subsequent accounts collection provided $ $ 816,024 1,218,551 290,400 193,554 305,243 11,206,431 884,101 117,260 5,834 16,223 329,932 371,976 304,856 82,152 7,796 -
1,177,277 Subsequent collection 239,328 Subsequent collection 3,202,111 Subsequent collection 164,097 Subsequent collection 847,849 Subsequent collection
200
Company Hongzhun Precision Tooling (Kunshan) Co., Ltd Jizhun Precision Industry (Huizhou) Co., Ltd. Fuzhun Precision Tooling (Huaian) Co., Ltd. Fuzhun Precision Tooling (Huaian) Co., Ltd. Fuyu Electronical Technology (Huaian) Co., Ltd. Hongfujin Precision Industrial (Wuhan) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Falcon Precision Trading Limited Falcon Precision Trading Limited Universal Field International Limited Universal Field International Limited Top Step Enterprises Limited Top Step Enterprises Limited Foxconn Technology CZ S. R. O. FuYu Energy Technology (Kunshan) Co., Ltd. Fugion Material Technology (Shenzhen) Limited Huaian Fulitong Trading Co., Ltd. Foxconn Image & Printing Product Pte. Ltd. Futaihua Industrial (Shenzhen) Limited Futaihua Industrial (Shenzhen) Limited Futaihua Industrial (Shenzhen) Limited
Counterparty Hongfujin Precision Electronics (Chengdu) Limited Hongfujin Precision Industry (Shenzhen) Co., Ltd. Fuyu Electronical Technology (Huaian) Co., Ltd. Huaian Fulitong Trading Co., Ltd. Success Rise Enterprises Limited Top Step Enterprises Limited Futaijing Precision Electronics (Beijing) Co., Ltd. Futaijing Precision Electrons (Yantai) Co., Ltd AMB Logistics Ltd. Competition Team Technology Pte. Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd Full Profit International Limited Universal Field International Limited YanTai FuHuaDa Precision Electronics Limited NanNing FuGui Precision Industrial Co., Ltd Foxconn Technology Co., Ltd Fusing International Inc. Hongfujin Precision Electronics (Chengdu) Co., Ltd. Hongfutai Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Hongfujin Precision Industry (Wuhan) Co., Ltd. Foxconn Image & Printing Product Pte. Ltd. Innolux Corporation Ltd. (Formerly Chimei Innolux Corporation) Hongfujin Precision Industry (Wuhan) Co., Ltd. Fu Ding Precision Component (Shenzhen) Co., Ltd. Foxconn Electronic Industrial Development (Kunshan) Co., Ltd. Hongfujin Precision Industry (Chongqing) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Best Leap Enterprises Limited Fujin Precision Industrial (Jincheng) Co., Ltd.
Relationship with the company Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 2 Note 2 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 7 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 3 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Balance of receivable from related parties $ 216,215 511,480 743,467 383,858 3,224,509 7,243,984 1,046,516 2,406,492 872,992 914,768 850,198 254,515 6,581,778 3,085,985 126,927 15,288,164 2,180,795 282,498 156,972 178,852 603,873 256,098 316,888 268,752 195,898 192,997 186,355 114,378 131,860,729 3,643,963
Overdue receivables Turnover rate 3 6 1 2 6 14 6 2 2 7 3 4 8 3 2 6 2 8 2 2 7 3 1 1 3 1 Action adopted for overdue accounts Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection $ 201,720 321,003 7,243,984 1,023,565 643,943 812,888 637,762 323,939 146,818 6,581,778 1,477,042 119,468 11,742,028 51 131,518 124,873 50,646 268,752 191,458 58,501 152,151 31,576 83,150,010 3,068,042
Amount $ 39,968 16,307 131,533 74,177 1,023,565 643,943 812,888 18,993 17,958 169,353 1,279,666 477,001 50,109 388,764 51 32,159 316,888
35,407 Subsequent collection 86,994 Subsequent collection -
201
Company Futaihua Industrial (Shenzhen) Limited Futaihua Industrial (Shenzhen) Limited Futaihua Industrial (Shenzhen) Limited Futaihua Industrial (Shenzhen) Limited Futaihua Industrial (Shenzhen) Limited Futaihua Industrial (Shenzhen) Limited Futaihua Industrial (Shenzhen) Limited Futaihua Industrial (Shenzhen) Limited Fuhuajie Industrial (Shenzhen) Limited Fuhuajie Industrial (Shenzhen) Limited Fuhuajie Industrial (Shenzhen) Limited
Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hongfujin Precision Electronics (Chongqing) Co., Fujun Precision Electronics (Chongqing) Co., Ltd. Ltd. Foxconn Precision Electronics (Yan Tai) Co., Ltd YanTai FuHuaDa Precision Electronics Limited Chongqingshi Futaitong Logistics Limited Co., Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hongfujin Precision Electronics (Tianjin) Co., Ltd. Profit New Limited Hongfujin Precision Electronics (Chengdu) Co., Falcon Precision Trading Limited Ltd. Hongfujin Precision Electronics (Chengdu) Co., Futaihua Industrial (Shenzhen) Limited Ltd. Hongfujin Precision Electronics (Chengdu) Co., Hongfujin Precision Electronics (Chengdu) Co., Ltd. Ltd. Hongfujin Precision Electronics (Chengdu) Co., Interface Technology (Chengdu) Co., Ltd. Ltd. Fu Ding (ZhengZhou) Precision Industry Co., Ltd Fujin Precision Industrial (Jincheng) Co., Ltd. Fu Ding (ZhengZhou) Precision Industry Co., Ltd Hongfujin Precision Electronics (Zhengzhou) Limited Fu Ding (ZhengZhou) Precision Industry Co., Ltd Futaihua Precision Electronics (Jiyuan) Limited
Counterparty Hongfujin Precision Electronics (Chengdu) Limited Futaihua Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhenzhou) Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Futaihua Precision Electronics (Jiyuan) Limited Fuhong Precision Component (Bac Giang) Limited Foxconn CMMSG Industria de Eletronicos Ltda. Hongfujin Precision Industry (Taiyuan) Co., Ltd. Skilltop Limited Foxconn Image & Printing Product Pte. Ltd. Hongfujin Precision Electronics (Chongqing) Co., Ltd. Hightech Electronics Components Inc.
Relationship with the company Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 4 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1
Balance of receivable from related parties $ 3,952,654 1,102,065 7,326,521 1,473,771 1,937,113 1,084,734 1,127,182 140,282 2,683,902 186,758 3,238,990 29,666,431 2,161,370 169,201 163,850 3,435,836 284,989 4,540,794 1,311,037 222,330 118,767 177,392 677,721
Overdue receivables Turnover rate 2 1 2 1 1 1 2 2 1 1 2 5 2 7 3 6 18 7 4 2 2 2 2 Action adopted for Amount overdue accounts $ 148,574 Subsequent collection 31,749 Subsequent collection 214,122 Subsequent collection Subsequent collection $ 479,170 4,136,110 1,923,428 256,554 189,045 12,797 1,223,714 3,007,279 169,168 3,382,358 2,603 551,322 177,392 -
2,603 Subsequent collection 215,039 Subsequent collection 223,566 Subsequent collection -
202
Company Fu Ding (ZhengZhou) Precision Industry Co., Ltd Fujun Precision Electronics (Chongqing) Co., Ltd. YanTai FuHuaDa Precision Electronics Limited YanTai FuHuaDa Precision Electronics Limited Anpinda Precision Industrial (Huizhou) Co., Ltd. Wang Hui Trading Co., Ltd. NanNing FuGui Precision Industrial Co., Ltd. NanNing FuGui Precision Industrial Co., Ltd. Futaihua Precision Electronics (Zhengzhou) Limited Futaihua Precision Electronics (Zhengzhou) Limited Futaihua Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Hongfujin Precision Electronics (Zhengzhou) Limited ZhengZhou XunFeng Trading Co., Ltd. ZhengZhou XunFeng Trading Co., Ltd. Fusing International Inc. ChengDu XunFeng Trading Co., Ltd. HongZhaoDa Integrated Innovative Service (Kunshan) Co., Ltd. Competition Team Ireland Limited Competition Team Ireland Limited Competition Team Ireland Limited
Counterparty Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fuhuajie Industrial (Shenzhen) Limited Universal Fiele International Limited FuXun Tong Trading(Shenzhen) Co., Ltd. Glorious Prospect Enterprises Ltd. Kantron International Trading (Shenzhen) Co., Ltd. Hongfujin Precision Industry (Shenzhen) Co., Ltd. Mega Well Limited Futaihua Industrial (Shenzhen) Limited Hongfujin Precision Electronics (Zhengzhou) Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Competition Team Technology Limited Futaihua Industrial (Shenzhen) Limited Futaihua Precision Electronics (Zhengzhou) Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Futaihua Precision Electronics (Zhengzhou) Co., Ltd. Hongfujin Precision Electronics (Zhengzhou) Limited Innolux Corporation Ltd. Hongfujin Precision Electronics (Chengdu) Limited Smart Top International Ltd. Honfujin Precision Electronics (Chongqing) Co., Ltd. Fusing International Inc. Innocom Technology (Chongqing) Co., Ltd.
Relationship with the company Note 4 Note 1 Note 1 Note 1 Note 1 Note 7 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 2 Note 1 Note 1 Note 1 Note 1 Note 2
Balance of receivable from related parties $ 493,945 637,666 1,165,314 216,195 4,860,952 113,753 309,727 6,269,967 5,254,452 2,091,461 914,597 126,198,176 6,418,015 723,523 12,043,997 496,703 2,010,346 100,054 1,160,881 114,887 3,316,751 329,013 275,733
Overdue receivables Turnover rate 2 2 12 2 4 5 1 1 2 7 4 6 2 2 6 2 9 15 5 14 6 8 16 Action adopted for Amount overdue accounts $ 311,133 Subsequent collection Subsequent collection $ 1,165,314 3,548,400 2,182 4,021,733 126,198,176 3,221,926 12,043,997 200,678 1,283,736 100,054 80,753 114,887 2,186,341 163,292 142,948
100,054 Subsequent collection 12,500 Subsequent collection 114,887 Subsequent collection 504,133 Subsequent collection 69,093 Subsequent collection
203
Relationship with Counterparty the company Hongfujin Precision Industry (Shenzhen) Co., Ltd. Note 1 Fuhonyang Precision Industrial (Shenzhen) Co., Ltd. Note 1 Best Ever Industries Ltd. Note 1 Best Ever Industries Ltd. Note 1 Futaihua Industrial (Shenzhen) Limited Note 1 Hongfujin Precision Electronics (Zhengzhou) Note 1 Limited Foxconn Precision Electronics (Taiyuan) Co., Ltd. Fast Victor Limited Note 1 Foxconn Precision Electronics (Taiyuan) Co., Ltd. Foxconn CMMSG Industria de Eletronicos Ltda. Note 1 Futaihua Precision Electronics (Jiyuan) Limited Fujin Precision Industrial (Jincheng) Co., Ltd. Note 1 Futaihua Precision Electronics (Jiyuan) Limited Hongfujin Precision Electronics (Zhengzhou) Note 1 Limited Ambit Microsystems Corporation Limited Ambit Microsystems (Zhong shan) Corporation Note 1 Innocom Technology (Chongqing) Co., Ltd. Fujun Precision Electronics (Chongqing) Co., Ltd. Note 1 Foxconn Singapore Pte. Ltd. Foxconn TR Teknoloji San. Ltd. Sti. Note 1 Premier Image Technology (China) Ltd. Hongfujin Precision Electrons (Yantai) Co., Ltd. Note 1 Premier Image Technology (China) Ltd. Premier Image Technology (HK) Ltd. Note 1 Premier Image Technology (China) Ltd. Jumbo Rise Management Limited Note 1 Foxconn CMMSG Industria de Eletronicos Ltda. Futaihua Industrial (Shenzhen) Limited Note 1 Note 1: The investee and the counterparty are both indirect subsidiaries of the Company. Note 2: The counterparty of the investee is an indirect subsidiary of Innolux. Note 3: The Companys chairman is a major shareholder of the counterparty. Note 4: The counterparty of the investee is an indirect subsidiary of FTC. Note 5: The counterparty of the investee is an investee of the Company accounted for under the equity method. Note 6: The counterparty of the investee is an indirect subsidiary of Zhen Ding Technology Holding Limited. Note 7: The counterparty of the investee is an indirect subsidiary of PIIC. Company WWW (Jincheng) Co., Ltd. WWW (Jincheng) Co., Ltd. Fortune Co., Ltd. MWM Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd. Foxconn Precision Electronics (Taiyuan) Co., Ltd.
Balance of receivable from related parties $ 242,188 341,383 146,993 2,041,392 6,779,289 5,672,591 26,224,112 1,307,447 338,551 4,668,016 604,953 282,847 361,939 575,733 1,079,426 4,996,287 125,154
Overdue receivables Turnover rate 1 2 2 3 5 3 7 2 2 6 2 4 10 3 5 2 Action adopted for Amount overdue accounts $ 6,779,289 Subsequent collection - Subsequent collection - Subsequent collection 861,788 Subsequent collection 83,548 Subsequent collection 36,626 Subsequent collection 1,079,426 Subsequent collection Subsequent collection $ 133,553 6,527,095 5,617,632 17,806,048 254,653 392,620 360,193 277,104 -
204
10) Information on derivative transactions: a) As of December 31, 2012, the information on derivative financial instruments of investee companies is as follows: Derivative financial instrument Forward exchange contracts: SELL USD/BUY KRW SELL USD/BUY MXN SELL USD/BUY RMB SELL EUR/BUY USD BUY EUR/ SELL INR BUY JPY / SELL BRL BUY JPY/ SELL INR BUY USD / SELL BRL BUY USD/SELL INR BUY USD/SELL RMB Contract amount (in thousands) USD KRW USD MXN USD RMB EUR USD EUR INR JPY BRL JPY INR USD BRL USD INR USD RMB 1,800 1,949,780 66,950 858,763 250,000 1,582,660 6,600 8,555 68 4,867 5,430 150 1,958 1,295 5,100 10,722 4,937 271,957 210,372 1,317,491 Maturity 2013.02.26~2013.05.23 2013.01.03~2013.03.21 2013.08.05~2013.08.15 2013.01.10~2013.03.21 2013.01.04 2013.02.14~2013.02.21 2013.01.04~2013.01.18 2013.01.03~2013.02.28 2013.01.01~2013.3.22 ( ( ( ( ( ( Book Value $ 288 31,419) 49,946 5,474) 35 285) 23) 3,297) 451 20,034) ( ( ( ( ( ( Fair Value $ 288 31,419) 49,946 5,474) 35 285) 23) 3,297) 451 20,034)
2013.01.22~2013.03.20
b) Additional disclosure: As of December 31, 2012, the Company recognized net gain of $62,957 on derivative transactions (including net loss of $9,812 on valuation of financial assets and liabilities on December 31, 2012).
205
(3)Disclosure of information on indirect investments in Mainland China 1)Information on investments in Mainland China Balance of Transactions during Balance of Ownership Investment income Profit remitted to amount remitted Jan. 1 ~Dec. 31, 2012 amount remitted percentage held (loss) recognized Book value of Taiwan during Method of from Taiwan Remittance Remittance from Taiwan as of by the Company during Jan. 1~ investment as of Jan. 1~ Capital investment as of Jan. 1, 2012 out in Dec. 31, 2012 (Direct/indirect) Dec. 31, 2012 Dec. 31, 2012 Dec. 31, 2012 Note $ 1,997,952 Note 1 (2) $ $ $ $ 69.49 $ 472,137 $ 16,591,093 $ - Note 2
Name of investee in Mainland China Foxconn Precision Component (Beijing) Co., Ltd. Fujin Precision Industry (Shenzhen) Co., Ltd. Shenzhen Fu Tai Hong Precision Industry Co., Ltd. Foxconn Precision Component (Shenzhen) Co., Ltd.
Main activities of investee Manufacturing of telecommunication cases Manufacturing and processing of computer cases, computer peripherals, etc. Manufacturing and marketing of computer cases, micro ribbon connectors for terminals, etc. Manufacturing of connectors, micro ribbon connectors for terminals, micro-computers, mouse cables, monitor cables, etc. Manufacturing and marketing of computer cases, micro ribbon connectors for terminals, etc. Manufacturing and marketing of computer cases and computer peripherals, etc. Manufacturing of connectors, micro ribbon connectors for terminals, micro-computers, mouse cables, monitor cables, etc. Manufacturing and marketing of connectors, micro ribbon connectors for terminals, etc. Manufacturing and marketing of computer case and computer peripherals, etc.
1,523,148
Note 1 (2)&(3)
145,200
145,200
100
21,116
2,330,151
126,614 Note 2
5,184,221 Note 1 (2)
69.49
( 2,472,474)
10,593,350
- Note 2
1,729,040
Note 1 (2)&(3)
87,120
87,120
100
13,393
1,971,711
- Note 2
Honxun Electrical Industry (Hangzhou) Co., Ltd. Hongzhun Precision Tooling (Shenzhen) Co., Ltd. Foxconn Computer Connectors (Kunshan) Co., Ltd.
3,682,272 Note 1 (2)
69.49
162,435
5,984,417
- Note 2
435,600 Note 1 (2)
100
7,753
641,030
- Note 2
1,295,184
Note 1 (2)&(3)
145,200
145,200
100
590,130
5,410,017
207,346 Note 2
Fu Ding Precision Component (Shenzhen) Co., Ltd. Hong Fujin Precision Industrial (Shenzhen) Co., Ltd.
1,393,920 Note 1 (2)
100
771,670
4,769,598
- Note 2
4,907,760 Note 1 (2)
100
3,679,317
63,333,051
1,016,981 Note 2
206
Name of investee in Mainland China
Main activities of investee
Capital
Balance of Transactions during Balance of Ownership Investment income Profit remitted to amount remitted Jan. 1 ~Dec. 31, 2012 amount remitted percentage held (loss) recognized Book value of Taiwan during Method of from Taiwan Remittance Remittance from Taiwan as of by the Company during Jan. 1~ investment as of Jan. 1~ investment as of Jan. 1, 2012 out in Dec. 31, 2012 (Direct/indirect) Dec. 31, 2012 Dec. 31, 2012 Dec. 31, 2012 $ $ $ $ 100 $ 172,372 $ 3,553,732 $
Note
Foxconn Electronic Manufacturing and marketing of Industrial computer cases, micro ribbon Development connectors for terminals, etc. (Kunshan) Co., Ltd. Futaije Science & Manufacturing and design Technology of computer components Development keyboards, etc. (Shenzhen) Co., Ltd. Fuhon Precision Manufacturing and marketing of Component connectors, micro ribbon (Shenzhen) Co., Ltd. connectors for terminals, etc. Hongzhun Precision Manufacturing and marketing of Tooling (Kunshan) computer cases Co., Ltd. Kangzhun Precision Manufacturing and marketing of Tooling (Kunshan) computer components, Co., Ltd. computer peripherals, etc. Futaikang Precision Manufacturing and marketing of Computer (Shenzhen) connectors, micro ribbon Co., Ltd. connectors for terminals, etc. Qunkang Precision Manufacturing and marketing of Component switching hub and router cases (Kunshan) Co., Ltd. Fujin Precision Manufacturing and marketing of Industrial (Jincheng) computer cases Co., Ltd. Honyeh Precision Manufacturing and marketing of Component computer components (Kunshan) Co., Ltd. Fuhonyang Precision Manufacturing and marketing of Industrial (Shenzhen) connectors, micro ribbon Co., Ltd. connectors for terminals, computer cases, etc. Foxway Precision Manufacturing and marketing of
$ 1,974,720 Note 1 (2)
- Note 2
348,480 Note 1 (2)
100
9,404
555,104
- Note 2
333,960 Note 1 (2)
100
16,598
1,310,359
63,017 Note 2
2,497,440 Note 1 (2)
100
1,106,086
12,636,692
78,989 Note 2
4,065,600 Note 1 (2)
842,160
842,160
100
909,550)
3,184,403
- Note 2
166,980 Note 1 (2)
100
1,767
256,622
- Note 2
174,240 Note 1 (2)
100
139,037)
95,574
- Note 2
8,799,120 Note 1 (2)
1,481,040
2,904,000
4,385,040
100
3,409,727
14,767,933
- Note 2
168,432 Note 1 (2)
100
28,787
437,317
42,108 Note 2
1,248,720 Note 1 (2)
667,920
580,800
1,248,720
100
34,864
1,834,475
- Note 2
363,000 Note 1 (2)
100
35,949
928,069
- Note 2
207
Name of investee in Mainland China Main activities of investee Capital Industry (Hangzhou) router components Co., Ltd. Hongfutai Precision Manufacturing and marketing of $ 4,297,920 Note 1 (2) Electrons (Yantai) auto digital signal process Co., Ltd. device and components Ambit Microsystems Manufacturing and marketing of 1,486,848 Note 1 (Zhong shan) power supplies (2)&(3) Corporation Ambit Microsystems Manufacturing and marketing of 2,131,536 Note 1 (Shanghai) Co., Ltd. power supplies, modems and (2)&(3) ADSL devices Amlink (Shanghai) Ltd. Manufacturing and marketing of 580,800 Note 1 power supplies, modems and (2)&(3) ADSL devices Fuxian Precision Manufacturing and marketing of 4,065,600 Note 1 (2) Industry (Kunshan) computer case Co., Ltd. Dong Guan Hong Song Manufacturing and marketing of 290,400 Note 1 (2) Precision Component keypad and computer Co., Ltd. Components Foxconn (Tianjin) Manufacturing and marketing of 1,533,312 Note 1 (2) Precision Industry wireless phone and components Co., Ltd. Fugion Material Manufacturing and marketing of 107,448 Note 1 (2) Technology potassium aurous cyanide (Shenzhen) Limited Antec Automotive Manufacturing and marketing of 276,025 Note 1 (2) Electric System automobile (Kunshan) Co., Ltd. Liuzhou Antec Manufacturing and marketing of - Note 1 (2) Fangshen Electric automobile System Co., Ltd. Foxconn Precision Manufacturing and marketing of 1,190,640 Note 1 (2) Electronics (Yantai) telecommunication peripherals Co., Ltd.
Balance of Transactions during Balance of Ownership Investment income Profit remitted to amount remitted Jan. 1 ~Dec. 31, 2012 amount remitted percentage held (loss) recognized Book value of Taiwan during Method of from Taiwan Remittance Remittance from Taiwan as of by the Company during Jan. 1~ investment as of Jan. 1~ investment as of Jan. 1, 2012 out in Dec. 31, 2012 (Direct/indirect) Dec. 31, 2012 Dec. 31, 2012 Dec. 31, 2012
Note
100
($
3,322,095)
$ 11,576,853
- Note 2
711,480
711,480
100
1,084,254
2,688,314
- Note 2
1,335,840
1,335,840
100
270,787
7,784,837
- Note 2
203,280
203,280
44.81
8,210
527,726
- Note 2
100
148,509
5,498,996
- Note 2
100
78,418
372,854
- Note 2
69.49
1,155,338)
613,254)
- Note 2
70
22,893
126,599
- Note 2
145,200
145,200
100
19,919)
114,019
- Note 2
- Note 2
952,158
952,158
100
259,452)
1,144,517
- Note 2
208
Name of investee in Mainland China Main activities of investee Premier Image Manufacturing and sale of Technology (China) cameras. Limited Fu Zhun Precision Designing, manufacturing and Tooling (Huai an) marketing of computer Co., Ltd. components Fu Yu Electronical Designing and marketing of Technology (Huaian) connectors and cables Co., Ltd. CJ Electric System Co., Manufacturing and marketing of Ltd. automobile Foxconn Precision Manufacturing and marketing of Electronics (Taiyuan) micro ribbon connectors for Co., Ltd. terminals, etc. Jizhun Precision Manufacturing and marketing of Industry (Huizhou) computer cases, router, Co., Ltd. notebook, etc. Fukui Precision Manufacturing and marketing of Component electronics devices and cable (Shenzhen) Co., Ltd. Futaijing Precision Manufacturing and marketing of Electronics (Beijing) computer cases, micro ribbon Co., Ltd. connectors for terminals, etc. Foxconn Precision Manufacturing and marketing of Electronics cell phone and components (Langfang) Co., Ltd. Foxconn Good Field Manufacturing and marketing of Precision Industry electronics calculator and (Dalian) Co., Ltd. components Fuyu Energy Manufacturing and marketing of Electronically micro ribbon connectors for Technology terminals (Kunshan) Co., Ltd. Hongfujin Precision Manufacturing and marketing of Industrial (Wuhan) computer and digital camera
Balance of Transactions during Balance of Ownership Investment income Profit remitted to amount remitted Jan. 1 ~Dec. 31, 2012 amount remitted percentage held (loss) recognized Book value of Taiwan during Method of from Taiwan Remittance Remittance from Taiwan as of by the Company during Jan. 1~ investment as of Jan. 1~ Capital investment as of Jan. 1, 2012 out in Dec. 31, 2012 (Direct/indirect) Dec. 31, 2012 Dec. 31, 2012 Dec. 31, 2012 Note 4,407,228 Note 1 18,876 18,876 99.96 ( 64,643) 11,730,478 - Note 2 (2)&(3) $ 2,880,768 Note 1 (2) $ $ $ $ 100 $ 227,932 $ 4,933,013 $ - Note 2
7,730,448 Note 1 (2)
3,484,800
1,452,000
4,936,800
100
483,787
9,637,541
- Note 2
63,888 Note 1 (2) 6,693,720 Note 1 (2)
2,087,818
2,087,818
50 100
23,550 5,487,171
158,955 10,905,517
- Note 2 - Note 2
958,320 Note 1 (2)
100
698,092)
326,414
- Note 2
5,839,276 Note 1 (2)
41.36
1,336,956
4,947,454
- Note 2
2,178,000 Note 1 (2)
69.49
33,366)
1,436,304
- Note 2
8,581,320 Note 1 (2)
69.49
1,843,381)
10,585,987
- Note 2
67,373 Note 1 (2)
40
2,845)
35,476
- Note 2
580,800 Note 1 (2)
100
26,026)
943,361
- Note 2
8,502,912 Note 1 (2)
4,149,816
1,452,000
5,601,816
100
1,343,531
11,960,214
- Note 2
209
Name of investee in Mainland China Main activities of investee Co., Ltd. components Amworld Manufacturing and marketing of Microsystems switch supply and modem (Shanghai) Ltd. Hongqunsheng Manufacturing and marketing of Precision Electronics printed circuit board (Yingkou) Co., Ltd. Hongqisheng Precision Manufacturing and marketing of Electronics electronics calculator and (Qinhuangdao) Co., component Ltd. Hongfujin Precision Manufacturing and marketing of Electrons (Yantai) computer components, Co., Ltd. computer Foxconn (Nanjing) Manufacturing and marketing of Communications Co., handset and components Ltd. Foxconn (Nanjing) Computer software, hardware Software Co., Ltd. and other digital product Honghuasheng Print circuit board products Precision Electronics manufacturing and sales (YanTai) Co., Ltd. Fulin Electronical Manufacturing and marketing of Technology computer components, (Changshu) Co., Ltd. computer Fuyang Electronical Manufacturing and marketing of Technology computer components, (Changshu) Co., Ltd. computer Fu Tai Kang Marketing of computer chassis Electronics and metal stamping parts Development (YanTai) Ltd. Foxconn (Shenyang) Numeric control machine tool precision Industry manufacturing Co., Ltd.
Capital
Balance of Transactions during Balance of Ownership Investment income Profit remitted to amount remitted Jan. 1 ~Dec. 31, 2012 amount remitted percentage held (loss) recognized Book value of Taiwan during Method of from Taiwan Remittance Remittance from Taiwan as of by the Company during Jan. 1~ investment as of Jan. 1~ investment as of Jan. 1, 2012 out in Dec. 31, 2012 (Direct/indirect) Dec. 31, 2012 Dec. 31, 2012 Dec. 31, 2012 100 11,757 630,235
Note
493,680 Note 1 (2)
- Note 2
$ 1,928,231 Note 1 (2)
41.36
($
93,157)
388,308
- Note 2
5,300,528 Note 1 (2)
41.36
258,049
2,543,516
- Note 2
2,056,032 Note 1 (2)
100
4,135,620
33,339,308
- Note 2
508,200 Note 1 (2)
69.49
68,417
268,592
- Note 2
929,280 Note 1 (2) - Note 1 (2)
100 -
32,159) -
675,937 -
- Note 2 - Note 4
1,582,680 Note 1 (2)
100
48,609
1,499,616
- Note 5
1,469,424 Note 1 (2)
100
18,271
1,605,156
- Note 5
871,200 Note 1 (2)
100
21,666
1,138,544
- Note 2
1,449,096 Note 1 (2)
69.23
33,694)
1,192,644
- Note 2
210
Name of investee in Mainland China Main activities of investee Hong Heng Sheng Print circuit board product Electronical manufacturing and sales Technology (Huaian) Co., Ltd. Alibaba (China) Providing software and Technology Co., Ltd. technology services Alibaba (China) Providing software and Software Co., Ltd. technology services Alibaba (Shanghai) Providing software and Technology Co., Ltd. technology services Beijing Sinya Online Providing software and Information technology services Technology Co., Ltd. Hongfuqiang Precision Manufacturing and marketing of Electronics (Yingkou) computer components, Co., Ltd. computer Fu Ding Electronical Manufacturing and marketing of Technology (Jiashan) computer components, Co., Ltd. computer Fuhuajie Industrial Manufacturing and marketing of (Shenzhen) Limited computer components, computer GDS Software Computer software, hardware (Shenzhen) Co., Ltd. and other digital product Futaihua Industrial Manufacturing and marketing of (Shenzhen) Co., Ltd. computer components, computer Dong Guan Eson Manufacturing and marketing of Precision Tooling Co., telecommunication cases Ltd. Kunshan Eson Manufacturing and marketing of Precision Engineering electronic components Co., Ltd. Wuxi XinGuan Metal Manufacturing and marketing of
Balance of Transactions during Balance of Ownership Investment income Profit remitted to amount remitted Jan. 1 ~Dec. 31, 2012 amount remitted percentage held (loss) recognized Book value of Taiwan during Method of from Taiwan Remittance Remittance from Taiwan as of by the Company during Jan. 1~ investment as of Jan. 1~ Capital investment as of Jan. 1, 2012 out in Dec. 31, 2012 (Direct/indirect) Dec. 31, 2012 Dec. 31, 2012 Dec. 31, 2012 Note 4,318,282 Note 1 (2) 41.36 ( 155,656) 1,651,119 - Note 2
- Note 1 (2) - Note 1 (2) - Note 1 (2) - Note 1 (2)
- Note 6 - Note 6 - Note 6 - Note 6
72,600 Note 1 (2)
100
79,944
- Note 2
6,127,440 Note 1 (2)
3,920,400
2,207,040
6,127,440
100
2,578,949
10,040,840
- Note 2
3,339,600 Note 1 (2)
3,339,600
3,339,600
100
2,385,074)
800,799
- Note 2
290,400 Note 1 (2) 10,744,800 Note 1 (2)
9,292,800
290,400 1,452,000
290,400 10,744,800
76.92 100
5,630 23,259,305
270,662 72,427,816
- Note 2 - Note 2
215,186 Note 1 (2)
28.81
6,425
89,767
- Note 2
871,490 Note 1 (2)
28.81
26,368
506,948
- Note 2
406,560 Note 1 (2)
28.81
456
87,307
- Note 2
211
Name of investee in Mainland China Main activities of investee Science & plastic mould Technology Co., Ltd. Kunshan Eson Manufacturing and marketing of Technology Inc. computer components, computer Yantai Jiray Electronic Manufacturing and marketing of Technology Co., Ltd. monitoring device Yantai Zheng Yi Manufacturing and marketing of Precision Electronic monitoring device Co., Ltd. Guangzhou OED Manufacturing and marketing of Technologies Co., mould and tooling Ltd. MediaMarkt (Shanghai) E-book key material and Commercial & components manufacturing and Trading Company sales Limited Hongfujin Precision Manufacturing and marketing of Electronics computer chassis and metal (Chongqing) Co., Ltd. stamping parts System Integration Manufacturing and marketing of Electronics electronic components, (Hangzhou)Co., Ltd. network communication equipment, high-end routers and high-end switches Champ Tech Optical Manufacturing and marketing of (Foshan) Corporation unassembled Optical components Innovation (Beijing) Design and publish of computer Software software Development Co., Ltd MediaMarkt (Shanghai) Management Consulting Consulting Service Services Co., Ltd.
Capital
Note
290,400 Note 1 (2)
9.51
790
29,281
- Note 2
$ 149,846 Note 1 (2) 63,888 Note 1 (2)
18.73 28.81
($ (
5,002) 3,503)
52,686 10,443
- Note 2 - Note 2
209,733 Note 1 (2)
5.76
2,969)
11,314
- Note 2
5,808,000 Note 1 (2)
25
1,344,427)
- Note 2
5,536,476 Note 1 (2)
5,536,476
5,536,476
100
752,311)
3,756,991
- Note 2
798,600 Note 1 (2)
837,795
837,795
100
137,422
1,291,116
- Note 2
1,355,297 Note 1 (2)
1,358,503
194,859
1,553,362
100
151,017
2,009,231
- Note 2
- Note 1 (2)
- Note 7
- Note 1 (2)
- Note 8
212
Name of investee in Mainland China Main activities of investee Spreadcomm Developing of computer and Technology Corp. communications software, and technical services Futaihua Precision Manufacturing and marketing of Electronics cell phone (Zhengzhou) Co., Ltd. Hongfujin Precision Manufacturing and marketing of Electronics (Tianjin) server Co., Ltd. Hongfujin Precision Manufacturing and marketing of Electronics cell phone and components (Zhengzhou) Co., Ltd. Hongfujin Precision Manufacturing and marketing of Electronics (Chengdu) tablet PC Co., Ltd. Fuding Precision Manufacturing and marketing of Industrial new electronic components (Zhengzhou) Co., Ltd. YanTai FuHuaDa Manufacturing and marketing of Precision Electronics new electronic components Co., Ltd. Fujun Precision Manufacturing and marketing of Electronics switches and routers (Chongqing) Co., Ltd. Futaihua Precision Manufacturing and marketing of Electronics (Chengdu) compression molding plastic Co., Ltd. injection mold and metal Anpinda Precision Manufacturing and marketing of Industrial (Huizhou) computer components, Co., Ltd. computer NanNing FuGui Manufacturing and marketing of Precision Industrial network communication Co., Ltd equipment NanNing Fu Tai Hong Manufacturing and marketing of
Balance of Transactions during Balance of Ownership Investment income Profit remitted to amount remitted Jan. 1 ~Dec. 31, 2012 amount remitted percentage held (loss) recognized Book value of Taiwan during Method of from Taiwan Remittance Remittance from Taiwan as of by the Company during Jan. 1~ investment as of Jan. 1~ Capital investment as of Jan. 1, 2012 out in Dec. 31, 2012 (Direct/indirect) Dec. 31, 2012 Dec. 31, 2012 Dec. 31, 2012 Note 220,704 Note 1 (2) 69.49 ( 54,374) 38,502 - Note 2
2,904,000 Note 1 (2)
987,360
987,360
100
3,129,506
6,188,303
- Note 2
$ 1,974,720 Note 1 (2)
$ 1,974,720
$ 1,974,720
100
($
1,279,420)
417,229
- Note 2
14,520,000 Note 1 (2)
2,904,000
2,904,000
5,808,000
100
11,453,330
28,477,994
- Note 2
10,164,000 Note 1 (2)
2,904,000
2,904,000
5,808,000
100
5,376,985
19,743,016
- Note 2
1,161,600 Note 1 (2)
290,400
290,400
100
159,187)
353,614
- Note 2
290,400 Note 1 (2)
290,400
290,400
100
45,987
531,019
- Note 2
435,600 Note 1 (2)
435,600
435,600
100
116,095)
325,811
- Note 2
1,335,840 Note 1 (2)
348,480
987,360
1,335,840
100
354,390
1,644,377
- Note 2
1,452,000 Note 1 (2)
1,161,600
1,161,600
100
1,123
1,302,391
- Note 2
1,452,000 Note 1 (2)
1,234,200
1,234,200
100
399,269
1,639,976
- Note 2
1,452,000 Note 1 (2)
69.49
12,045
995,301
- Note 2
213
Name of investee in Mainland China Main activities of investee Precision Industry cell phone Co., Ltd WWW (Jincheng) Co., Manufacturing and marketing of Ltd. lens module UER Technology Manufacturing and marketing of (Shenzhen) lithium Battery Corporation Tianjin Manufacturing and marketing of Funayuanchuang liquid crystal display Technology Co., Ltd. components FuYu Energy Engaged in the production and Technology (Funing) marketing of operating solar Co., Ltd. energy battery business. Futaihua Precision Engaged of wireless handsets of Electronics (Jiyuan) wired telephones, cellular Limited networks or other wireless IP telephone Hongfujin Precision Engaged in the operation of Industry (Loyang) automated equipment, Co., Ltd. multipurpose industrial robots, the equipment enclosure sheet metal production and marketing business Futaijing Precision Manufacturing and marketing of Electronics (Yantai) handset component product Co., Ltd. Foxconn (Tianjin) A set of parts of the GSM digital Technology Co., Ltd. handheld wireless phones, GSM, CDMA and other CDMA handheld wireless telephones Zhong Zhun Precision ReducerOther transmission Industries (Luoyang) shafts and cranks Co., Ltd.
Capital
Note
754,603 Note 1 (2) - Note 1 (2)
464,640 -
464,640 -
76.85 -
13,650) -
704,721 -
- Note 2 - Note 9
$ 784,080 Note 1 (2)
$ 493,680
493,680
62.96
($
38,747)
416,210
- Note 2
- Note 1 (2)
- Note 10
2,904,000 Note 1 (2)
726,000
726,000
100
1,706,125
4,640,323
- Note 2
- Note 1 (2)
- Note 11
580,800 Note 1 (2)
69.49
5,873
415,879
- Note 2
- Note 1 (2)
- Note 12
- Note 1 (2)
- Note 13
214
Name of investee in Mainland China Main activities of investee Hongfutai Precision Work holders Industry (Hen Yang) Co., Ltd. Innocom Technology LCD related products, modules, (Chongqing) Co., components and systems Ltd. manufacture Funeng Energy Electromechanical Technology Service telecommunications and circuit (Nanyang) Co., Ltd. equipment installation.
Balance of Transactions during Balance of Ownership Investment income Profit remitted to amount remitted Jan. 1 ~Dec. 31, 2012 amount remitted percentage held (loss) recognized Book value of Taiwan during Method of from Taiwan Remittance Remittance from Taiwan as of by the Company during Jan. 1~ investment as of Jan. 1~ Capital investment as of Jan. 1, 2012 out in Dec. 31, 2012 (Direct/indirect) Dec. 31, 2012 Dec. 31, 2012 Dec. 31, 2012 Note 1,103,520 Note 1 (3) 1,103,520 1,103,520 100 ( 1,491) 1,112,707 - Note 2
87,120 Note 1 (2)
115,404
115,404
100
190,277
Note 2
- Note 1 (2)
- Note 14
Name of Company Hon Hai Precision Industry Co., Ltd.
Accumulated amount wired out from Taiwan to mainland China as of December 31, 2012 73,505,945
Investment amount approved by FIC of MOEA $ 174,016,782
Ceiling of investment amount of the Company $ -
Note 1: The methods of remittance of investments to mainland China are as follows: (1) Company funds are remitted from Taiwan through an investee company located outside of Taiwan and mainland China. (2) Investee company established by the Company and located outside of Taiwan and mainland China remits its own funds directly to the investee companies located in mainland China. (3) Investee company located outside of Taiwan and mainland China remits its own funds directly to the investee companies located in mainland China. (4) Directly investing in companies in mainland China. (5) Others. Note 2: Investment income or losses recognized during 2012 were based on the investees audited financial statements. Note 3: The shares of Liuzhou Antec Fangshen Electric System Co., Ltd. have been sold out on February, 2012. As of December 31, 2012, the funds have not been remitted back. Note 4: During the year ended December 31, 2012, the shares of Honghuasheng Precision Electronic (Yantai) Co., Ltd. had been transferred to Pan International Industrial Co., Ltd. Note 5: 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. As of December 31, 2012, the merger has not been completed. Note 6: The Company held indirectly 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 on June, 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$2,600,000. Note 8: The Company was approved by Investment Commission, MOEA of an investment of US$ 8,750,000 in MediaMarkt (Shanghai) Consulting Service Co., Ltd.. As of December 31, 2012, the funds have not been remitted. Note 9: The Company was approved by Investment Commission, MOEA of an investment in UER Technology (Chengdu) Corporation, which has been rescinded on February 13, 2012. The Company was approved by Investment Commission, MOEA of an investment of US$ 18,000,000 in UER Technology (Shenzhen) Corporation, which has not yet been established as of December 31, 2012. Note 10: The Company was approved by Investment Commission, MOEA of an investment of US$ 30,000,000 in FuYu Energy Technology (Funing) Co., Ltd., which has not yet been established as of December 31, 2012. Note 11: 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, 2012. Note 12: The Company was approved by Investment Commission, MOEA of an investment in Foxconn (Tian Jin) Technology Co., Ltd., which has been rescinded on September 19, 2012. Note 13: 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, 2012.
215
The Company was approved by Investment Commission, MOEA of an investment of US$ 35,000,000 in Funeng Energy Technology Service (Nanyang) Co., Ltd.. As of December 31, 2012, the funds have not been remitted. 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. 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. 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 18: The Company invests in the company via investee companies in Mainland China including Lang Fang Fertile Plan Logistics Co., Ltd., YanTai Futaitong International Logistics Co., Ltd., Shanghai Futaitong International Logistics CO., Ltd., Huaian Fulitong Trading Co., Ltd., Shanghai Foxconn Co., Ltd., Yantaishi Fulitong International Trading Co., Ltd., Shenzhen Fuhongjie Technology Service Co., Ltd., Shenzhen Fertile Plan(Futaitong) international Logistics Co., Ltd., Shanghai KetaiHuajie Investment Co., Ltd., Shan Hai Pengzhan Investment Co., Ltd., Chongqingshi Futaitong Logistics Limited Co., Limited, FuXun Tong Trading(ShenZhen) Co., Ltd., FoShan ShunDe Jishun Precision Industrial Co., Ltd., JiaXing Wanmabenteng Commerce Co., Ltd., HuaiAn Futaitong Logistics Co., Ltd., ChongQing Shendeng Technology Co., Ltd., HongQingXin Precision Electronics (ChongQing) Co., Ltd., ChengDu Futaitong Logistics Co., Ltd., ShenZhen Wanmabenteng Commerce Co., Ltd., ZhengZhou Wanmada Commerce Co., Ltd., ChengDu Wanmada Commerce Co., Ltd., KunShan Junteng Commerce Co., Ltd., Yantaishi Wanmabenteng Commerce Co., Ltd., Wang Hui Trading Co., Ltd. -China Shanghai, Efeihu (Beijing) E-commerce Ltd., Efeihu (Chengdu) E-commerce Ltd., HongZhaoDa Integrated Innovative Service (KunShan) Co., Ltd., Wan Ma Da Trading Co., Ltd., -China GuangXi, Efeihu (Wuhan) E-commerce Ltd., Wan Ma Ben Teng Trading Co., Ltd. -China TianJin, ZhengZhou XunFeng Trading Co., Ltd., ChengDu XunFeng Trading Co., Ltd., Zhengzhou Airport Fertile Plan Logistics Co., Ltd., Wan Ma Ben Teng Trading Co., Ltd. -China HuNan, Wan Ma Ben Teng Trading Co., Ltd. -China Jiangx, Xiang Ma Trade Co., Ltd.- China Chongqing., Tian Zhen Foxconn Photovoltaic Electricity Generation Co., Ltd., Da Tong Foxconn Photovoltaic Electricity Generation Co., Ltd., Yang Gao Foxconn Photovoltaic Electricity Generation Co., Ltd., HenYang FuXiangYun Cuiture Co.,Ltd., ChongQing HongFuZhun Trading Co., Ltd., Foxstar Technology Co., Ltd., Synergy Technology ChengDuCo., Ltd., Harbing GDS Technology Co., Ltd., and Fu You Wan De Trading 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. 2) Significant transactions with investee in Mainland China: The Company subcontracted the processing of products to Foxconn (Far East) Limiteds subsidiaries located in Mainland China. All intercompany transactions were eliminated when preparing consolidated financial statements. Transactions Difference with general transactions Ending Relationship with the company Purchases / sales Amount Unit price Terms Balance Note Best Leap Enterprises Limited Indirect investee company accounted for Purchases $ 760,977,081 Note Note ($ 128,769,081) under the equity method Competition Team Technology LimitedIndirect investee company accounted for Purchases 445,389,241 " " ( 101,801,174) Bahamas under the equity method Foxconn (Far East) Limited and Wholly-owned subsidiary Purchases 412,203,558 " " ( 91,657,738) subsidiaries and subsidiaries Hongfujin Precision Electronics (Chengdu) Indirect investee company accounted for Purchases 400,306,397 " " ( 82,100,323) Co., Ltd. under the equity method Universal Field International Limited Indirect investee company accounted for Purchases 163,072,275 " " ( 18,426,473) under the equity method Foxconn CZ S.R.O. Indirect investee company accounted for Purchases 88,053,588 " " ( 3,997,441) under the equity method AMB Logistics Ltd. Indirect investee company accounted for Purchases 23,931,474 " " ( 741,723) under the equity method NSG Technology Indirect investee company accounted for Purchases 3,954,048 " " under the equity method Foxconn Global Services Division S.R.O. Indirect investee company accounted for Purchases 159,886 " " ( 159,886) under the equity method Foxconn (Far East) Limited and Wholly-owned subsidiary Sales 39,825,230 " " 36,362,495 Note 14: Note 15: Note 16: Note 17:
216
subsidiaries
and subsidiaries
Note: 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 are determined in accordance with mutual agreements. 2012 Processing Cost Success Rise Enterprises Ltd. Heroic Legend Enterprises Ltd. Franklin Management Ltd. Foxconn (Far East) Limited and subsidiaries Best Leap Enterprises Limited Beyond Maximum Industrial Ltd. Carston Ltd. $ 24,538,973 18,863,275 16,503,053 12,746,052 11,395,252 10,944,341 3,976,588 $ 98,967,534 $ $ Prepayments Payable $ 6,667,214 14,986,541 14,846,695 21,732,987 435,798 1,878,416 25,330,425 $ 85,878,076 Processing Cost $ 21,204,392 25,377,089 8,229,082 13,329,535 17,166,854 8,744,143 4,368,017 $ 98,419,112 $ $ 2011 Prepayments Payable $ 2,227,618 12,465,540 9,375,977 6,541,619 3,498,644 3,313,136 28,048,035 $ 65,470,569
(4) The relationship and significant transactions between the Company and its subsidiaries For the year ended December 31, 2012 Description of transactions Number (Note a) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Relationship (Note b) 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 The percentage of total consolidated revenue or total consolidated assets (Note d) 1 19 11 10 10 4 2 1 6 5 4 4 1 1 3 6
Name of company Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd.
Name of counterparties Foxconn (Far East) Limited and subsidiaries Best Leap Enterprises Limited Competition Team Technology Limited Hongfujin Precision Electronics (Chengdu) Co., Ltd. Foxconn (Far East) Limited and subsidiaries Universal Field International Limited Foxconn CZ S. R. O. Foxconn (Far East) Limited and subsidiaries Best Leap Enterprises Limited Competition Team Technology Limited Hongfujin Precision Electronics (Chengdu) Co., Ltd. Foxconn (Far East) Limited and subsidiaries Foxconn (Far East) Limited and subsidiaries Carston Ltd. Foxconn (Far East) Limited and subsidiaries Futaihua Industrial (Shenzhen) Co., Ltd.
Account Sales Purchases Purchases Purchases Purchases Purchases Purchases Accounts receivable Accounts payable Accounts payable Accounts payable Accounts payable Accrued expenses Accrued expenses Other receivables Other receivables
Amount 39,825,230 760,977,081 445,389,241 400,306,397 412,203,558 163,072,275 88,053,588 36,362,495
Transaction terms Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c
( ( ( ( ( (
128,769,081) 101,807,174) 82,100,323) 91,657,738) 21,732,987) 25,330,425) 64,308,654 122,051,631
217
Description of transactions Number (Note a) 0 0 0 1 Relationship (Note b) 1 1 1 3 3 3 3 3 3 3 3 3 3 3 The percentage of total consolidated revenue or total consolidated assets (Note d) 4 3 1 1 3 3 20 6 3 1 13 6 3 2
Name of company Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd.
Name of counterparties Hongfujin Precision Electronics (Zhengzhou) Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. Universal Field International Limited
Account Other receivables Other receivables Other receivables Sales Sales Sales Sales Accounts receivable Sales Accounts receivable Sales Accounts receivable Sales Accounts receivable
Amount 78,660,801 69,893,800 25,448,382 49,479,435 99,499,196 107,086,065 782,867,169 131,860,729 121,082,335 29,666,431 528,064,023 $ 126,198,176 95,486,777 26,224,112
Transaction terms Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c
Hongfutai Precision Electronics Universal Field International Limited (Yantai) Co., Ltd. 2 Hongfujin Precision Industrial Top Step Enterprises Limited (Wuhan) Co., Ltd. 3 Hongfujin Precision Electronics Universal Field International Limited (Yantai) Co., Ltd. 4 Futaihua Industrial (Shenzhen) Co., Best Leap Enterprises Limited Ltd. 4 Futaihua Industrial (Shenzhen) Co., Best Leap Enterprises Limited Ltd. 5 Hongfujin Precision Electronics 0 Hightech Electronics Components Inc. (Chongqing) Co., Ltd. 5 Hongfujin Precision Electronics 0 Hightech Electronics Components Inc. (Chongqing) Co., Ltd. 6 Hongfujin Precision Electronics Competition Team Technologies Limited (Zhengzhou) Co., Ltd. 6 Hongfujin Precision Electronics Competition Team Technologies Limited (Zhengzhou) Co., Ltd. 7 Foxconn Precision Electronics Fast Victor Limited (Taiyuan) Co., Ltd. 7 Foxconn Precision Electronics Fast Victor Limited (Taiyuan) Co., Ltd. For the year ended December 31, 2011
Description of transactions The percentage of total Number (Note a) 0 0 0 0 0 0 0 Name of company Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Name of counterparties Foxconn (Far East) Limited and subsidiaries Foxconn (Far East) Limited and subsidiaries Foxconn (Far East) Limited and subsidiaries Foxconn (Far East) Limited and subsidiaries Foxconn (Far East) Limited and subsidiaries Best Leap Enterprises Limited Best Leap Enterprises Limited Relationship (Note b) 1 1 1 1 1 1 1 Account Sales Purchases Accounts receivable Other receivables Accounts payable Purchases Accounts payable $ Amount 53,634,030 302,063,412 37,322,266 67,767,858 92,445,026) 904,829,843 142,271,576) Transaction terms Note c Note c Note c Note c Note c Note c Note c consolidated revenue or total consolidated assets (Note d) 2 9 2 4 5 26 8
( (
218
Description of transactions The percentage of total Number (Note a) 0 0 0 0 0 0 0 0 0 0 0 0 1 2 Name of company Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Hon Hai Precision Industry Co., Ltd. Name of counterparties Carston Ltd. Competition Team Technology Limited Competition Team Technology Limited Foxconn CZ S. R. O. Universal Field International Limited Universal Field International Limited Universal Field International Limited Futaihua Industrial (Shenzhen) Co., Ltd. Relationship (Note b) 1 1 1 1 1 1 1 1 Account Accrued expenses Purchases Accounts payable Purchases Purchases Other receivables Accounts payable Other receivables Purchases Other receivables Accounts payable Other receivables Sales Sales Sales Accounts receivable Sales Sales Sales Sales Sales Sales Accounts receivable Sales Accounts receivable ( ( Amount 28,048,035) 153,710,732 43,622,684) 101,500,784 166,342,084 27,388,492 26,278,390) 133,859,236 227,068,983 39,766,610 45,330,111) 34,580,826 41,600,373 37,988,785 Transaction terms Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c Note c consolidated revenue or total consolidated assets (Note d) 2 4 3 3 5 2 2 8 7 2 3 2 1 1 27 7 1 1 2 3 2 2 1 5 3
Hon Hai Precision Industry Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. 1 Hon Hai Precision Industry Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. 1 Hon Hai Precision Industry Co., Ltd. Hongfujin Precision Electronics (Chengdu) Co., Ltd. 1 Hon Hai Precision Industry Co., Ltd. Hongfujin Precision Electronics (Zhengzhou) Co., Ltd. 1 Skilltop Limited Foxconn Image & Printing Product Pte. Ltd. 3 Ambit Microsystem (Shanghai) Co., AMB Logistics Ltd. 3 Ltd. 3 Futaihua Industrial (Shenzhen) Co., Ltd. Best Leap Enterprises Limited 3 3 Futaihua Industrial (Shenzhen) Co., Ltd. Best Leap Enterprises Limited 3 3 Fuhuajie Industrial (Shenzhen) Limited Skilltop Limited 3 4 Hongfutai Precision Electronics Dragon Spirit Industries Ltd. 3 (Yantai) Co., Ltd. 4 Hongfutai Precision Electronics Universal Field International Limited 3 (Yantai) Co., Ltd. 5 Hongfujin Precision Industrial Top Step Enterprises Limited 3 (Wuhan) Co.,Ltd. 6 Hongfujin Precision Electronics Hightech Electronics Components Inc. 3 (Chongqing) Co., Ltd 7 Hongfujin Precision Electrons Universal Field International Limited 3 (Yantai) Co., Ltd. 7 Hongfujin Precision Electrons Universal Field International Limited 3 (Yantai) Co., Ltd. 8 Hongfujin Precision Electronics Competition Team Technology Limited 3 (Zhengzhou) Co., Ltd. 8 Hongfujin Precision Electronics Competition Team Technology Limited 3 (Zhengzhou) Co., Ltd. Note a: The information of transactions between the Company and the consolidated subsidiaries should be noted in Number column.
934,049,393 116,716,083 $ 41,797,064 35,102,347 82,182,678 92,793,098 61,976,821 84,522,212 19,733,437 161,277,425 44,021,902
219
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 statement.
220
12. OPERATING SEGMENTS INFORMATION 1) 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 R.O.C. SFAS No. 41, 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. The chief operating decision maker assesses performance and allocates resources of the operating segments based on each operating segments revenue and operating income after adjusting the internal costs and allocated expenses. Except that recognition of internal costs shall be in accordance with the Groups related internal calculation basis, the operating segments accounting policies are the same as disclosed in Note 2. 2) Financial information of reportable segment The financial information of reportable segment provided to chief operating decision maker is as follows: 2011 2012 Net external revenue $ 3,147,460,520 $ 3,880,825,993 Revenue from internal customers 279,268,751 526,688,317 Segment revenue $ 3,426,729,271 $ 4,407,514,310 Segment income $ 96,229,483 $ 122,477,734 Segment assets (Note) $ $ Note: The chief operating decision maker does not use the measured amount of the assets as a measurement indicator; therefore, the measured amount of the Groups assets shall be disclosed as $0. 3) Reconciliation information of segment income, assets, and liabilities The reconciliations of a pre-tax income between reportable segments and continuing operations were as follows: Operating revenue 2011 2012 Total reported segment revenue $ 3,426,729,271 $ 4,407,514,310 Other operating segment revenue 62,760,660 55,771,358 Elimination of intersegment revenue ( 36,808,658) ( 557,890,346) Total corporate revenue $ 3,452,681,273 $ 3,905,395,322
221
Profit and loss Income of reported segment Income of other operating segments Elimination of intersegment transactions and internal costs and allocated expenses adjustments Income before income tax 4) Revenue information by product
$ (
2011 96,229,483 1,700,469) 8,007,186 102,536,200
$ (
2012 122,477,734 11,589,301) 7,490,658 118,379,091
Revenues from external customers are mainly derived from assembling of 3C products. The breakdown of retail and wholesale results are shown in Note 12. 5) Revenue information by geographic area 2011 Revenue Non-current assets United States of America $ 987,885,444 $ 2,408,224 Ireland 763,130,682 52 China 439,784,193 283,402,318 Singapore 388,658,671 271,999 Japan 247,835,759 27,689 Taiwan 108,466,630 36,351,485 Others 516,919,894 75,059,340 $3,452,681,273 $ 397,521,107 2012 Non-current assets $ 1,751,004 173,191 342,166,834 151,407 22,082 30,944,534 62,804,923 $ 438,013,975
Revenue $1,140,906,312 1,096,315,965 340,938,734 334,362,334 217,845,375 111,468,690 663,557,912 $3,905,395,322
Revenue by geographic area of the Group is based on the location of customers. Non-current assets include fixed assets, intangible assets, and other assets. 6) Information on major customers Sales to a single customer which represent over 10% of net operating revenues were (in millions): Customers 2011 2012 Customer E $ 1,350,423 $ 1,865,774 Customer C 459,723 459,975 13. DISCLOSURES RELATING TO THE ADOPTION OF IFRSs Pursuant to the regulations of the Financial Supervisory Commission, Executive Yuan, R.O.C., effective January 1, 2013, a public company whose stock is listed on the Taiwan Stock Exchange Corporation or traded in the GreTai Securities Market should prepare financial statements in accordance with the International Financial Reporting Standards (IFRSs), International Accounting Standards (IASs), and relevant interpretations and interpretative bulletins that are ratified by the Financial Supervisory Commission. The Company discloses the following information in advance prior to the adoption of IFRSs under
222
the requirements of Jin-Guan-Zheng-Shen-Zi Order No. 0990004943 of the Financial Supervisory Commission, dated February 2, 2010: A. Major contents and status of execution of the Companys plan for IFRSs adoption: The Company has formed an IFRSs group, which is responsible for setting up a plan relative to the Companys transition to IFRSs. The major contents and status of execution of this plan are outlined below: Working Items for IFRSs Adoption Status of Execution a. Formation of an IFRSs group Completed b. Setting up a plan relative to the Companys transition to IFRSs c. Identification of the differences between current accounting policies and IFRSs d. Identification of consolidated entities under the IFRSs framework e. Evaluation of the impact of each exemption and option on the Company under IFRS 1 First-time Adoption of International Financial Reporting Standards f. Evaluation of needed information system adjustments g. Evaluation of needed internal control adjustments h. Establish IFRSs accounting policies i. Selection of exemptions and options available under IFRS 1 - First-time Adoption of International Financial Reporting Standards j. Preparation of statement of financial position on the date of transition to IFRSs k. Preparation of IFRSs comparative financial information for 2012 l. Completion of relevant internal control (including financial reporting process and relevant information system) adjustments Completed Completed Completed Completed
Completed Completed Completed Completed
Completed In process Completed
B. Material differences that may arise between current accounting policies used in the preparation of financial statements and IFRSs and Rules Governing the Preparation of Financial Statements by Securities Issuers that will be used in the preparation of financial statements in the future: The Company uses the IFRSs already ratified currently by the Financial Supervisory Commission and the Rules Governing the Preparation of Financial Statements by Securities
223
Issuers that will be applied in 2013 as the basis for evaluation of material differences in accounting policies as mentioned above. However, the Companys current evaluation results may be different from the actual differences that may arise when new issuances of or amendments to IFRSs are subsequently ratified by the Financial Supervisory Commission or relevant interpretations or amendments to the Rules Governing the Preparation of Financial Statements by Securities Issuers come in the future. The Company has identified material differences that may arise between current accounting policies used in the preparation of financial statements and IFRSs and Rules Governing the Preparation of Financial Statements by Securities Issuers that will be used in the preparation of financial statements in the future, and the effects of exemptions selected by the Company under IFRS 1, First-time Adoption of International Financial Reporting Standards (refer to Note 13(3)) are set forth below: 1. Reconciliation of significant differences as of January 1, 2012 GAAP (R.O.C.) Adjustment IFRSs Description Available-for-sale financial assets non-current $ 4,790,319 $ 4,575,192 $ 9,365,511 (1)(2) Financial assets carried at cost non-current 4,046,796 ( 28,740) 4,018,056 (2) Equity investments under the equity method 40,259,657 ( 2,467,599) 37,792,058 (1) Property, Plant and Equipment 355,373,481 12,792,611 368,166,092 (3)(8) Other assets other 26,350,582 874,893 27,225,475 (3)(4) Investment property 1,434,274 1,434,274 (4) Deferred charges 15,101,778 ( 15,101,778) (8) Deferred income tax assets - current 8,016,419 ( 8,016,419) (12) Deferred income tax assets noncurrent 10,560,705 10,560,705 (6)(7)(12) Others 1,276,372,393 1,276,372,393 Total Assets $ 1,730,311,425 $ 4,623,139 $ 1,734,934,564
224
Financial liabilities at fair value through profit or loss non-current Accrued expenses Reserve for retirement plan Deferred income tax liabilities non-current Others Total Liabilities Capital reserve from long-term investments Capital reserve from conversion right Cumulative translation adjustments Unrealized gain or loss on financial instruments Undistributed earnings Others Total Stockholders' Equity Total Liabilities and Stockholders Equity
GAAP (R.O.C.) $ -
Adjustment $ 470,158
IFRSs 470,158
Description (5)
87,322,885 1,064,300
1,809,910 453,411
89,132,795 1,517,711
(6) (7)
1,793,747 1,025,111,009 1,115,291,941
2,133,854 4,867,333
3,927,601 1,025,111,009 1,120,159,274
(12)
15,452,488
15,452,488)
(1)(9)
2,034,440
2,034,440)
(5)
21,141,456
94,099)
21,047,357
(1)(6)
1,802,723 325,500,402 249,087,975
2,645,108 14,691,725 -
4,447,831 340,192,127 249,087,975
(1)(2) (1)(5) (6)(7)(9)
615,019,484
244,194)
614,775,290
$1,730,311,425
4,623,139
$ 1,734,934,564
225
2. Reconciliation of significant differences as of December 31, 2012 GAAP (R.O.C.) Adjustment IFRSs Description Available-for-sale financial assets non-current $ 8,302,853 $ 4,195,864 $ 12,498,717 (1)(2) Financial assets carried at cost non-current 8,620,722 ( 28,740) 8,591,982 (2) Equity investments under the equity method 44,492,047 ( 2,533,104) 41,958,943 (1) Property, Plant and Equipment 390,298,219 14,856,857 405,155,076 (3)(8) Other assets other 23,596,212 3,953,366 27,549,578 (3)(4) Investment property 1,354,852 1,354,852 (4) Deferred charges 20,165,075 ( 20,165,075) (8) Deferred income tax assets - current 6,751,334 ( 6,751,334) (12) Deferred income tax assets noncurrent 10,951,902 10,951,902 (6)(7)(12) Others 1,542,177,055 1,542,177,055 Total Assets $2,044,403,517 $ 5,834,588 $ 2,050,238,105
226
Financial liabilities at fair value through profit or loss non-current Accrued expenses Reserve for retirement plan Deferred income tax liabilities non-current Others Total Liabilities Capital reserve from long-term investments Capital reserve from conversion right Cumulative translation adjustments Unrealized gain or loss on financial instruments Undistributed earnings Minority Interest Others Total Stockholders' Equity Total Liabilities and Stockholders Equity
GAAP (R.O.C.) $ -
Adjustment 15,288
IFRSs 15,288
Description (5)
137,224,165 1,103,395
2,328,293 628,051
139,552,458 1,731,446
(6) (7)
468,606 1,223,876,198 1,362,672,364
3,680,359 6,651,991
4,148,965 1,223,876,198 1,369,324,355
(12)
16,928,977
16,294,126)
634,851
(1)(9)
2,034,440
2,034,440)
(5)
1,395,612
25,101)
1,370,511
(1)(6)
4,169,293 385,380,938 35,198,966 236,622,927
2,265,753 14,410,421 860,090 -
6,435,046 399,791,359 36,059,056 236,622,927
(1)(2) (1)(5) (6)(7)(9) (9)
681,731,153
817,403)
680,913,750
$2,044,403,517
5,834,588
$ 2,050,238,105
227
3. Reconciliation of significant differences for the year ended December 31, 2012 GAAP (R.O.C.) Adjustment IFRSs Operating revenue $ 3,905,395,322 $ $ 3,905,395,322 Operating cost ( 3,575,766,285) Gross profit 329,629,037 Operating expenses ( 221,178,556) Operating income 108,450,481 Non-operating income and gains 23,932,586 Non-operating expenses and losses ( 14,003,976) Income before income tax 118,379,091 Income tax expense ( 26,591,950) Consolidated net income $ 91,787,141 Attributable to: Equity holders of the Company $ 94,762,377 Minority interest ( 2,975,236) $ 91,787,141 ( 79,379,769) ( 79,379,769) 78,827,558 ( 552,211) 345,205 ( 3,655,146,054) 250,249,268 ( 142,350,998) 107,898,270 24,277,791
Description (6)(7) (10)(11) (6)(7) (10)(11)
(1)(5)
( 207,006) 86,601 ($ 120,405)
14,003,976) 118,172,085
( $
26,505,349) 91,666,736
(6)(7)
($ ($
120,405) 120,405)
$ ( $
94,641,972 2,975,236) 91,666,736
228
Description of the reconciliation of significant differences: Item Explanation (1) Investments in associates / Equity investments under the equity method In accordance with current accounting standards in R.O.C., if an investor company holds less than 20% of the investee companys voting shares without losing significant influence over an investee company, the investments should be accounted for under equity method. In accordance with IAS 28, Investments in Associates, when an investment ceases to be an associate, the investment should be reclassified as Available-for-sale financial assets and measured at its fair value at the date when it ceases to be an associate. Account Increase (Decrease) at transition date December 31, 2012
$ Available-for-sale financial assets - noncurrent Unrealized gain or loss on financial instruments Undistributed earnings ( Gain on equity investments under the equity method ( Capital reserve from long-term investments Cumulative translation ( adjustments ( Equity investments under the equity method Dividend income
4,530,477
4,153,041
2,629,133 535,814) ( (
2,251,670 535,814) 254,621)
8,172) 22,269) 2,467,599) (
10,280 3,466 2,533,104) 144,956
229
Item (2)
(3)
(4)
Explanation Financial assets: equity instruments In accordance with the pre-amended Rules Governing the Preparation of Financial Statements by Securities Issuers, before July 7, 2011, unlisted stocks and emerging stocks held by the Company should be measured at cost and recognized in Financial assets carried at cost. However, in accordance with IAS 39, Financial Instruments: Recognition and Measurement, investments in equity 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. Prepayments for equipment In accordance with the Rules Governing the Preparation of Financial Statements by Securities Issuers, prepayments for the acquisition of property, plant and equipment are classified as Property, plant and equipment. However, under IFRSs, it should be classified as Other assets non-current. Property, plant and equipment In accordance with current accounting standards in R.O.C., the Companys property that is leased to others is 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.
Account Available-for-sale financial assets - noncurrent Unrealized gain or loss on financial instruments Financial assets carried ( at cost - non-current $
Increase (Decrease) at transition date December 31, 2012 44,715 $ 42,823
15,975 28,740) (
14,083 28,740)
Other assets noncurrent Prepayments for equipment (
2,309,167 2,309,167) (
5,308,218 5,308,218)
Investment property Other assets noncurrent
1,434,274 1,434,274)
1,354,852 1,354,852)
230
Item (5)
(6)
Explanation Financial instruments: presentation In accordance with current accounting standards in R.O.C., the conversion price of convertible bonds overseas should be converted to an agreed conversion price in New Taiwan dollars with a fixed exchange rate applicable on conversion of bonds. The conversion rights which are converted to a fixed amount of common shares should be classified as equity instruments. However, in accordance with IAS 32, Financial Instruments: Presentation, the conversion rights which do not meet the criteria of equity instruments should be classified as financial liabilities. Employee benefits The current accounting standards in R.O.C. do not specify the rules on the cost recognition for accumulated unused compensated absences. The Company recognizes such costs as expenses upon actual payment. However, IAS 19, Employee Benefits, requires that the costs of accumulated unused compensated absences should be accrued as expenses at the end of the reporting period.
Account $ Financial liabilities at fair value through profit or loss - non-current Undistributed earnings ( Capital reserve from conversion right Gain on valuation financial liabilities
Increase (Decrease) at transition date December 31, 2012 470,158 $ 15,288
1,564,282 2,034,440) -
1,564,282 2,034,440) 454,870
Accrued expenses Undistributed earnings ( Deferred income tax assets - non-current Cumulative translation ( adjustments Operating cost - salaries Operating expenses salaries Tax expense
1,809,910 1,404,728) 333,352 71,830) -
2,328,293 1,404,728) 413,440 28,567) 429,714 141,711
89,867)
231
Item (7)
Explanation Pensions (i) The discount rate used to calculate pensions shall be determined with reference to the factors specified in R.O.C. SFAS 18, paragraph 23. However, IAS 19, Employee Benefits, requires an entity to determine the rate used to discount employee benefits with reference to market yields on high quality corporate bonds that match the currency at the end day of the reporting period and duration of its pension plan; when there is no deep market in corporate bonds, an entity is required to use market yields on government bonds (at the end day of the reporting period) instead.
Account Reserve for retirement plan Undistributed earnings Deferred income tax assets - non-current Operating cost - salaries Operating expenses salaries Tax expense $ (
Increase (Decrease) December 31, 2012 at transition date 453,411 376,331) 77,080 ( ( $ 628,051 376,331) 106,769 2,953) 16,261) 3,266 160,899)
( (
(ii) The Company recognized all accumulated actuarial gain or Actuarial loss on loss associated with the employee benefits plans in defined benefit pension Retained earnings at the date of transition to IFRSs. plan (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 Companys 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 recognised in net pension cost of current period using the corridor
232
method. However, in accordance with IAS 19, Employee Benefits, the Group selects to recognise immediately actuarial pension gain or loss in other comprehensive income. Item (8) Deferred charges Account Property, plant and equipment In accordance with current accounting standards in R.O.C., cost Deferred charges ( of tools is recognized in Deferred Charges. However, under IFRSs, it should be recognized in Property, plant and equipment. Capital reserve A. The Company has elected not to apply the requirements in Undistributed earnings IFRS 3, Business Combinations, retrospectively to ( business combinations and investments in associates that Capital reserve from occurred prior to the date of transition to IFRSs, and has long-term investments 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. B. In addition, when a subsidiary issues new shares and parent Capital reserve from company does not purchase or acquire new shares difference between the proportionately that results in a change of parent companys price for acquisition or ownership percentage and a change of the equity in net assets for the investment that parent company has invested, disposal of subsidiaries but that does not result in a loss of control over the and carrying amount subsidiary, in accordance with current accounting standards Minority interest in ROC, such differences shall be used to adjust the capital Explanation Increase (Decrease) December 31, 2012 at transition date $ 15,101,778 $ 20,165,075 15,101,778) ( 20,165,075)
(9)
15,444,316 15,444,316) (
15,444,316 15,444,316)
860,090)
860,090
233
surpluslong-term equity investments and long-term equity investments. However, in accordance with IAS 27, Consolidated and Separate Financial Statements, a change in parent companys 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 companys 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 surplusthe difference between the consideration paid or received for acquisition or disposal of the ownership interest in a subsidiary and the carrying amount. Item Explanation Account (10) Product warranty costs Under current accounting standards in ROC, the Company Operating cost presents product warranty costs in selling expenses. However, under IFRSs, they shall be presented in cost of Operating expenses goods sold. (11) Royalty expenses The Company pays royalties based on the sale volume of the Operating cost related product as required by the contract. Under current accounting standards in ROC, the royalties are presented in Operating expenses selling expenses. However, under IFRSs, they shall be presented in cost of goods sold. Income taxes In accordance with current accounting standards in R.O.C., a deferred tax asset or liability should, according to the classification of its related asset or liability, be classified as current or noncurrent. However, a deferred tax asset or liability
234
Increase (Decrease) at transition day December 31, 2012 $ $ ( 34,382,737 34,382,737)
44,570,271 44,570,271)
(12)
Deferred income tax assets - non-current Deferred income tax assets - current (
10,150,273 8,016,419) (
10,431,693 6,751,334)
that is not related to an asset or liability for financial reporting Deferred income tax should be classified as current or noncurrent according to the liabilities - non-current 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, as the Companys 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.
2,133,854
3,680,359
235
C. Exemptions elected in accordance with IFRS 1, First-time Adoption of International Financial Reporting Standards and the Rules Governing the Preparation of Financial Statements by Securities Issuers that will be applied in 2013 are set forth below: 1. Business combinations The Company has elected not to apply the requirements in IFRS 3, Business combinations, retrospectively to business combinations that occurred prior to transition to IFRSs (Transition Date). This exemption is also applied to investments in associates of the Company. 2. Share-based payment The Company has elected not to apply the requirements in IFRS 2, Share-based payment, retrospectively to the equity instruments and liabilities that have been settled due to share-based payment transactions prior to the Transition Date. 3. Leases The Company has elected to apply the transitional provisions in IFRIC 4, Determining Whether an Arrangement Contains a Lease. Therefore, the Company determines whether an arrangement contains a lease based on the facts and circumstances on the Transition Date. 4. Employee benefits The Company has elected to recognize all accumulated actuarial gain or loss associated with the employee benefits plans in Retained earnings at the date of transition to IFRSs, and to disclose the present value of defined benefit obligation, fair value of plan assets, gain or loss on plan assets and experience adjustments in accordance with paragraph 120A (P), IAS 19, Employee Benefits, based on their prospective amounts of financial periods from the date of transition to IFRSs. 5. Compound financial instruments The Company has elected not to segregate between liability components and equity components of compound financial instruments whose liability components were not outstanding at the Transition Date. 6. Designation of previously recognized financial instruments The Company reclassified part of financial assets carried at cost to available-forsale financial assets on the Transition Date. 7. Decommissioning liabilities in property, plant and equipment The Company measured decommissioning liabilities in property, plant and equipment in accordance with IAS 37, Provisions, Contingent Liabilities and Contingent Assets on the Transition Date. 8. Borrowing costs The Company has elected to apply the transition provisions in paragraphs 27 and 28 in IAS 23, Borrowing Costs, amended in 2007, from the Transition Date. 9. 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 from the Transition Date. The above exemptions are different from the actual selection at the Transition Date due to the issuance of related regulations by competent authorities, changes in economic environment, and assessment by the Company.
236
VII. Financial Analysis

A. 2012 vs. 2011 Financial Analysis
Unit: NT$Thousand
Year Item Current assets Fund and Long-term equity investments Fixed assets Other assets Total assets Current liabilities Other liabilities Total liabilities Common stock Capital surplus Retained earnings Difference 2012 1,083,776,739 603,762,719 26,828,097 1,277,471 1,715,645,026 988,892,523 4,853,916 1,069,112,839 118,358,665 77,266,078 445,361,440 2011 Amount 958,370,691 534,685,388 33,886,138 1,184,021 1,528,126,238 861,779,296 4,215,877 950,294,550 106,890,967 70,693,639 377,321,804 125,406,048 69,077,331 % 13.09% 12.92% (Note 2) Ratio change analysis and explanation
(7,058,041) (20.83)% 93,450 187,518,788 127,113,227 638,039 118,818,289 11,467,698 6,572,439 68,039,636 7.89% 12.27% 14.75% 15.13% 12.50% 10.73% 9.30% 18.03%
Total stockholders equity 646,532,187 577,831,688 68,700,499 11.89% Note 1: Items will be analyzed and explained if ratio changed more than 20% and changed amount excess NT$10 million. Note 2: Fixed assets variance analysis: Compare to previous year, the amount of fixed asset of year 2012 decreased mainly due to significantly reduced the new equipment procurement and sale of equipment to overseas subsidiaries.
B. 2012 vs. 2011 Operating Result Analysis

Unit: NT$Thousand Change Variance percentage analysis (%) 16.07% 15.05% 41.15% 39.24% 45.80% (0.68)% (40.36)% 17.08% 4 1 2 3
Year Item Revenues Cost of revenues Gross profit Operating expenses Operating income Non-operating income Non-operating expenses Income (loss) before 2012 3,218,928,395 2011 2,773,311,378
Amount changed 445,617,017 401,244,060 44,372,957 29,947,400 14,425,557 (440,089) (1,689,826) 15,675,294
(3,066,728,559) (2,665,484,499) 152,199,836 (106,273,993) 45,925,843 64,038,228 (2,497,303) 107,466,768 107,826,879 (76,326,593) 31,500,286 64,478,317 (4,187,129) 91,791,474 237
income taxes Income tax benefit (expense) Net income (loss) (12,704,391) 94,762,377 (10,200,475) 81,590,999 2,503,916 13,171,378 24.55% 16.14% 5
Variance analysis: 1. Due to product mix changed resulting in improved gross margin. 2. Due to higher royalty fees and warranty expenses from mobile device products resulting in increased operating expenses in 2012. 3. Due to revenue grew coupled with magnitude of gross margin increased more than operating expenses resulting in bigger change in magnitude of operating income. 4. Due to the company has more USD currency assets than USD currency liabilities coupled with TWD depreciated against USD in year 2012 resulting in a larger exchange losses; besides, the company created large JPY liabilities due to equipment procurement coupled with NTD appreciated against JPY resulting in exchange gains. Net net, as a result of insignificant exchange loss in year 2012. 5. Due to higher net income resulting in higher income tax expenses.
C. Cash Flow Analysis

(1) 2012 vs. 2011 Liquidity Analysis
Year Item Cash flow ratio (%) Cash Flow Adequacy Ratio (%) Cash reinvestment ratio (%) 2012 11.13% 113.81 12.36 2011 Note 83.09 Note Ratio Change (%) 36.97 -
Variance Analysis: Due to operating cash flow increased significantly in 2012 resulting in a great improvement in Cash Flow Adequacy Ratio. Note: The ratio will not be listed because of negative number.
(2) Cash Flow Forecast in 2013

Unit: NT$Thousand Cash beginning Cash flow from operating balance activities (1) (2) Cash flow-in (out) (3) Cash ending balance (shortage) (1)+(2)-(3) 23,579,114 Plan for cash ending balance shortage Investment activities Financing act ivities 6,981,879
71,517,954
3,100,537,942
3,148,476,782
Cash flow variance analysis for year 2013: (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 2013.
238
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: On the Date of:
Gou, Tai-Ming (Terry Gou) 4/16/2013
239
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 Companys stock list:
Number of The date Source The Number of shares Investment of the of Companys shares or or gains and acquisition funds ownership amount amount losses or disposal of disposal 100% 2012 118,437 Shares(P.S.) N/A N/A Shares as of the Endorsement Loan date of Set amount of amount this pledge the of the Annual Company Company Report printed 1,302,812 N/A Shares N/A N/A
Name of Subsidiaries
Paid-in capital
Hongjing International Own 20,000,000 Investment funds Co., Ltd.
(3) Other supplementary information: None (4) Matters affect the shareholders equity or the price of securities: None
240
Hon Hai Precision Industry Co., Ltd. Chairman: Gou, Tai-Ming (Terry Gou)
241

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Stock Code 2317

HON HAI PRECISION INDUSTRY CO., LTD.

Annual Report 2012

I. Spokesperson: Name: Simon Hsing Title: Spokesperson Tel: (02)2268-3466#3629

Singapore Stock Exchange: http://www.sgx.com/wps/portal/marketplace/mp-ch/home

VI. Company Website:

CCPBG Business Group

CESBG Business Group

CMMSG Business Group Compensation Committee

Internal Audit Division Executive Secretary Chairmans Office

CNSBG Business Group

iDPBG Business Group

iDSBG Business Group

NWInG Business Group

PCEBG Business Group

SHZBG Business Group

F&A and Investment Management Division

Global R&D Center

System information Division

Corporate Governance Report

Global Procurement Division

(1) Organization Chart

Global Legal Division

Human Resources Division

(3) Directors and Supervisors Date: 04/28/2013

Gou, Tai-ming (Terry Gou)

Feb. 20, 925,961,760 1974

Hon Chiao International Investment Co., Ltd

Hon Chiao International Investment Co., Ltd

Jun. 8, 2010 Jul. 1, 2010

None 3 Jun. 8, 2007 961,344 0.01 1,302,812 0.01 0 0 0 0 None None

Main working (education) experience

Current positions in the Company and other companies

Jun. 8, 2010 Jul. 1, 2010

None 3 Jun. 8, 2007 961,344 0.01 1,302,812 0.01 0 0 0 0 None None

Attorney of I-Si Technology Law Firm

Jun. 15, 1998

Jun. 8, Representative: 2010 Wan, Jui-hsia Jul. 1, 2010

Jun. 10, 2004

Main working (education) experience

Current positions in the Company and other companies

Jun. 8, 2010 Jul. 1, 2010

(4) Major shareholders of institutional shareholders Date: 04/28/2013

(7) Management Team Information Date: 04/28/2013

Main experience (education experience)

Current positions at other companies

Title Name Relation

Chairman and President

Feb. 20, 1989

Department Tai, Aug. 1, General Jeng-wu 1992 Manager

Tatung Institute of Technology, Taiwan

Department Lu, General SungManager ching

Masters Degree, University of Illinois, U.S.A.

Shareholding Title Name Inaugura tion date Number %

Main experience (education experience)

Current positions at other companies

Spouse or seconddegree relative holding a position as manager

Title Name Relation

Department You, May 27, General Xiang-fu 1992 Manager

36,643,284 0.31 57,169,569 0.48

Department Lu, General FangManager ming

6,344,859 0.05 1,535,802 0.01

Shareholding Title Name Inaugura tion date Number %