EX-99.3 4 d576812dex993.htm EX-99.3

EX-99.3

Exhibit 99.3

Chunghwa Telecom Co., Ltd. and

Subsidiaries

Consolidated Financial Statements for the

Three Months Ended March 31, 2018 and 2017

CHUNGHWA TELECOM CO., LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In Millions of New Taiwan Dollars)

		March 31, 2018 (Unaudited)								December 31, 2017 (Audited)								March 31, 2017 (Unaudited)
		Amount				%				Amount				%				Amount				%
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	31,529				7			$	28,825				7			$	38,006				9
Financial assets at fair value through profit or loss			—				—				—				—				—				—
Hedging derivative financial assets			—				—				—				—				—				—
Held-to-maturity financial assets			—				—				—				—				1,290				—
Contract assets			6,259				1				—				—				—				—
Trade notes and accounts receivable, net			29,999				7				31,941				7				28,187				6
Receivables from related parties			29				—				49				—				31				—
Inventories			11,080				2				8,840				2				8,369				2
Prepayments			5,535				1				2,188				—				5,209				1
Other current monetary assets			5,394				1				5,308				1				4,710				1
Other current assets			2,246				—				2,183				—				1,825				—
Total current assets			92,071				19				79,334				17				87,627				19
NONCURRENT ASSETS
Financial assets at fair value through other comprehensive income			7,305				2				—				—				—				—
Available-for-sale financial assets			—				—				5,751				1				5,088				1
Investments accounted for using equity method			2,381				—				2,326				1				2,470				1
Contract assets			3,588				1				—				—				—				—
Property, plant and equipment			284,977				61				288,708				64				285,915				64
Investment properties			8,048				2				8,048				2				8,109				2
Intangible assets			53,833				12				54,883				12				46,498				10
Deferred income tax assets			3,250				1				2,730				1				2,343				1
Incremental costs of obtaining contracts			2,283				—				—				—				—				—
Net defined benefit assets			1,289				—				13				—				1,171				—
Prepayments			3,412				1				3,573				1				3,910				1
Other noncurrent assets			5,434				1				5,536				1				5,055				1
Total noncurrent assets			375,800				81				371,568				83				360,559				81
TOTAL		$	467,871				100			$	450,902				100			$	448,186				100
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term loans		$	170				—			$	70				—			$	439				—
Financial liabilities at fair value through profit or loss			1				—				1				—				4				—
Hedging derivative financial liabilities			—				—				1				—				1				—
Contract liabilities			8,654				2				—				—				—				—
Trade notes and accounts payable			14,695				3				19,396				4				12,881				3
Payables to related parties			415				—				684				—				398				—
Current tax liabilities			13,124				3				8,674				2				9,439				2
Other payables			21,576				5				25,001				6				21,885				5
Provisions			100				—				189				—				123				—
Advance receipts			—				—				8,842				2				9,253				2
Other current liabilities			1,300				—				1,081				—				1,233				—
Total current liabilities			60,035				13				63,939				14				55,656				12
NONCURRENT LIABILITIES
Contract liabilities			2,384				1				—				—				—				—
Long-term loans			1,600				—				1,600				—				1,600				—
Deferred income taxes liabilities			2,065				—				1,430				—				1,498				—
Provisions			79				—				78				—				67				—
Customers’ deposits			4,560				1				4,671				1				4,539				1
Net defined benefit liabilities			2,002				—				2,704				1				1,546				—
Deferred revenue			—				—				3,612				1				3,605				1
Other noncurrent liabilities			4,537				1				3,458				1				3,790				1
Total noncurrent liabilities			17,227				3				17,553				4				16,645				3
Total liabilities			77,262				16				81,492				18				72,301				15
EQUITY ATTRIBUTABLE TO STOCKHOLDERS OF THE PARENT
Common stocks			77,574				17				77,574				17				77,574				17
Additional paid-in capital			148,103				32				148,091				33				147,180				33
Retained earnings
Legal reserve			77,574				17				77,574				17				77,574				17
Special reserve			2,681				—				2,681				1				2,676				1
Unappropriated earnings			75,499				16				54,633				12				64,284				15
Total retained earnings			155,754				33				134,888				30				144,534				33
Other adjustments			417				—				383				—				133				—
Total equity attributable to stockholders of the parent			381,848				82				360,936				80				369,421				83
NONCONTROLLING INTERESTS			8,761				2				8,474				2				6,464				2
Total equity			390,609				84				369,410				82				375,885				85
TOTAL		$	467,871				100			$	450,902				100			$	448,186				100

- 1 -

CHUNGHWA TELECOM CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In Millions of New Taiwan Dollars, Except Earnings Per Share)

(Unaudited)

		Three Months Ended March 31
		2018								2017
		Amount				%				Amount				%
REVENUES		$	53,632				100			$	54,533				100
OPERATING COSTS			34,450				64				34,621				63
GROSS PROFIT			19,182				36				19,912				37
OPERATING EXPENSES
Marketing			5,653				10				6,282				12
General and administrative			1,191				2				1,164				2
Research and development			925				2				921				1
Expected credit loss			398				1				—				—
Total operating expenses			8,167				15				8,367				15
OTHER INCOME AND EXPENSES			(72	)			—				(12	)			—
INCOME FROM OPERATIONS			10,943				21				11,533				22
NON-OPERATING INCOME AND EXPENSES
Interest income			39				—				44				—
Other income			56				—				60				—
Other gains and losses			(33	)			—				44				—
Interest expenses			(4	)			—				(6	)			—
Share of the profits of associates and joint ventures accounted for using equity method			80				—				118				—
Total non-operating income and expenses			138				—				260				—
INCOME BEFORE INCOME TAX			11,081				21				11,793				22
INCOME TAX EXPENSE			2,558				5				2,939				6
NET INCOME			8,523				16				8,854				16
TOTAL OTHER COMPREHENSIVE INCOME (LOSS)
Items that will not be reclassified to profit or loss:
Unrealized gain or loss on investments in equity instruments designated as at fair value through other comprehensive income			(234	)			—				—				—
Gain on hedging instruments subject to basis adjustment			1				—				—				—

(Continued)

- 2 -

CHUNGHWA TELECOM CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In Millions of New Taiwan Dollars, Except Earnings Per Share)

(Unaudited)

		Three Months Ended March 31
		2018								2017
		Amount				%				Amount				%
Income tax benefit relating to items that will not be reclassified to profit or loss		$	207				—			$	—				—
			(26	)			—				—				—
Items that may be reclassified subsequently to profit or loss:
Exchange differences arising from the translation of the foreign operations			(52	)			—				(214	)			—
Unrealized gain or loss on available-for-sale financial assets			—				—				327				—
Cash flow hedges			—				—				(1	)			—
Share of exchange differences arising from the translation of the foreign operations of associates and joint ventures			1				—				(3	)			—
Income tax benefit relating to items that may be reclassified subsequently to profit or loss			—				—				1				—
			(51	)			—				110				—
Total other comprehensive income (loss), net of income tax			(77	)			—				110				—
TOTAL COMPREHENSIVE INCOME		$	8,446				16			$	8,964				16
NET INCOME ATTRIBUTABLE TO
Stockholders of the parent		$	8,267				15			$	8,627				16
Noncontrolling interests			256				1				227				—
		$	8,523				16			$	8,854				16
COMPREHENSIVE INCOME ATTRIBUTABLE TO
Stockholders of the parent		$	8,182				15			$	8,765				16
Noncontrolling interests			264				1				199				—
		$	8,446				16			$	8,964				16
EARNINGS PER SHARE
Basic		$	1.07							$	1.11
Diluted		$	1.07							$	1.11

(Concluded)

- 3 -

CHUNGHWA TELECOM CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(In Millions of New Taiwan Dollars)

(Unaudited)

		Equity Attributable to Stockholders of the Parent
																										Other Adjustments
																										Exchange Differences Arising from the Translation of the Foreign Operations				Unrealized Gain or Loss on Available-for- sale Financial Assets				Unrealized Gain or Loss on Financial Assets at FVOCI				Cash Flow Hedges				Gain on Hedging Instruments				Total Other Adjustments				Total Equity Attributable to Stockholders of the Parent
										Retained Earnings
		Common Stocks				Additional Paid-in Capital				Legal Reserve				Special Reserve				Unappropriated Earnings				Total Retained Earnings																																Noncontrolling Interests				Total Equity
BALANCE, JANUARY 1, 2017		$	77,574			$	147,180			$	77,574			$	2,676			$	55,657			$	135,907			$	46			$	(51	)		$	—			$	—			$	—			$	(5	)		$	360,656			$	6,272			$	366,928
Cash dividends distributed by subsidiaries			—				—				—				—				—				—				—				—				—				—				—				—				—				(11	)			(11	)
Net income for the three months ended March 31, 2017			—				—				—				—				8,627				8,627				—				—				—				—				—				—				8,627				227				8,854
Other comprehensive income (loss) for the three months ended March 31, 2017			—				—				—				—				—				—				(189	)			328				—				(1	)			—				138				138				(28	)			110
Total comprehensive income (loss) for the three months ended March 31, 2017			—				—				—				—				8,627				8,627				(189	)			328				—				(1	)			—				138				8,765				199				8,964
Share-based payment transactions of subsidiaries			—				—				—				—				—				—				—				—				—				—				—				—				—				4				4
BALANCE, MARCH 31, 2017		$	77,574			$	147,180			$	77,574			$	2,676			$	64,284			$	144,534			$	(143	)		$	277			$	—			$	(1	)		$	—			$	133			$	369,421			$	6,464			$	375,885
BALANCE, JANUARY 1, 2018		$	77,574			$	148,091			$	77,574			$	2,681			$	54,633			$	134,888			$	(174	)		$	558			$	—			$	(1	)		$	—			$	383			$	360,936			$	8,474			$	369,410
Effect of retrospective application (Note 2)			—				—				—				—				12,393				12,393				—				(558	)			883				1				(1	)			325				12,718				(4	)			12,714
BALANCE, JANUARY 1, 2018 AS ADUJUSTED			77,574				148,091				77,574				2,681				67,026				147,281				(174	)			—				883				—				(1	)			708				373,654				8,470				382,124
Net income for the three months ended March 31, 2018			—				—				—				—				8,267				8,267				—				—				—				—				—				—				8,267				256				8,523
Other comprehensive income (loss) for the three months ended March 31, 2018			—				—				—				—				206				206				(54	)			—				(238	)			—				1				(291	)			(85	)			8				(77	)
Total comprehensive income (loss) for the three months ended March 31, 2018			—				—				—				—				8,473				8,473				(54	)			—				(238	)			—				1				(291	)			8,182				264				8,446
Share-based payment transactions of subsidiaries			—				12				—				—				—				—				—				—				—				—				—				—				12				22				34
Net increase in noncontrolling interests			—				—				—				—				—				—				—				—				—				—				—				—				—				5				5
BALANCE, MARCH 31, 2018		$	77,574			$	148,103			$	77,574			$	2,681			$	75,499			$	155,754			$	(228	)		$	—			$	645			$	—			$	—			$	417			$	381,848			$	8,761			$	390,609

- 4 -

CHUNGHWA TELECOM CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Millions of New Taiwan Dollars)

(Unaudited)

		Three Months Ended March 31
		2018				2017
CASH FLOWS FROM OPERATING ACTIVITIES
Income before income tax		$	11,081			$	11,793
Adjustments to reconcile income before income tax to net cash provided by operating activities:
Depreciation			6,895				7,176
Amortization			1,070				903
Amortization of incremental costs of obtaining contracts			452				—
Expected credit loss			398				—
Provision for doubtful accounts			—				303
Interest expenses			4				6
Interest income			(39	)			(44	)
Dividend income			—				—
Compensation cost of share-based payment transactions			—				4
Share of the profits of associates and joint ventures accounted for using equity method			(80	)			(118	)
Loss on disposal of property, plant and equipment			21				12
Gain on disposal of financial instruments			(6	)			(1	)
Provision for inventory and obsolescence			32				13
Impairment loss on intangible assets			51				—
Valuation loss on financial assets and liabilities at fair value through profit or loss, net			—				3
Gain on foreign exchange, net			(22	)			(26	)
Changes in operating assets and liabilities:
Decrease (increase) in:
Financial assets held for trading			—				—
Financial assets mandatorily measured at fair value through profit or loss			60				—
Contract assets			135				—
Trade notes and accounts receivable			1,593				2,603
Receivables from related parties			21				(18	)
Inventories			(2,405	)			(959	)
Prepayments			(3,193	)			(2,900	)
Other current monetary assets			79				120
Other current assets			69				297
Incremental cost of obtaining contracts			(261	)			—
Increase (decrease) in:
Contract liabilities			409				—
Trade notes and accounts payable			(4,701	)			(5,924	)
Payables to related parties			(269	)			(364	)
Other payables			(2,257	)			(1,945	)
Provisions			—				5
Advance receipts			—				(11	)
Other current liabilities			182				(82	)
Deferred revenue			—				59
Net defined benefit plans		$	(1,978	)		$	(243	)
Cash generated from operations			7,341				10,662
Interest paid			(5	)			(6	)
Income tax paid			(12	)			(8	)
Net cash provided by operating activities			7,324				10,648

(Continued)

- 5 -

CHUNGHWA TELECOM CO., LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Millions of New Taiwan Dollars)

(Unaudited)

		Three Months Ended March 31
		2018				2017
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of time deposits and negotiable certificate of deposit with maturities of more than three months			(2,317	)			(2,188	)
Proceeds from disposal of time deposits and negotiable certificate of deposit with maturities of more than three months			2,118				2,147
Proceeds from disposal of held-to-maturity financial assets			—				850
Proceeds from disposal of available-for-sale financial assets			—				2
Acquisition of property, plant and equipment			(4,390	)			(4,612	)
Proceeds from disposal of property, plant and equipment			10				1
Proceeds from capital reduction of available-for-sale financial assets			—				—
Proceeds from capital reduction of investments accounted for using equity method			19				—
Acquisition of intangible assets			(70	)			(48	)
Acquisition of investment properties			(6	)			—
Increase in other noncurrent assets			(43	)			(85	)
Interest received			42				54
Cash dividends received			—				—
Net cash used in investing activities			(4,637	)			(3,879	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from short-term loans			200				2,259
Repayment of short-term loans			(100	)			(1,958	)
Decrease in customers’ deposits			(101	)			(86	)
Decrease in other noncurrent liabilities			(38	)			(8	)
Change in other noncontrolling interests			38				—
Net cash provided by (used in) financial activities			(1	)			207
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS			18				(70	)
NET INCREASE IN CASH AND CASH EQUIVALENTS			2,704				6,906
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD			28,825				31,100
CASH AND CASH EQUIVALENTS, END OF PERIOD		$	31,529			$	38,006

(Concluded)

- 6 -

CHUNGHWA TELECOM CO., LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

THREE MONTHS ENDED MARCH 31, 2018 and 2017

(In Millions of New Taiwan Dollars, Except Earnings Per Share)

(Unaudited)

1. STATEMENT OF COMPLIANCE

The Company has prepared its consolidated balance sheets as of March 31, 2018 and 2017, the related consolidated statements of comprehensive income, changes in equity and cash flows for the three months ended March 31, 2018 and 2017 in accordance with IAS 34 “Interim Financial Reporting” as issued by the International Accounting Standard Board (IASB). The consolidated financial statements are incomplete as they omit the related footnote disclosures as required under International Financial Reporting Standards as issued by IASB.

2. APPLICATION OF NEW AND REVISED STANDARDS AND INTERPRETATIONS

Except for the effect of application of IFRS 9 and IFRS 15 discussed below, the application of other new, revised or amended standards and interpretations effective from January 1, 2018 does not have material impact on the Company’s consolidated financial statements.

a. IFRS 9 “Financial Instruments” and related amendment

IFRS 9 supersedes IAS 39 “Financial Instruments: Recognition and Measurement”, with consequential amendments to IFRS 7 “Financial Instruments: Disclosures” and other standards. IFRS 9 sets out the requirements for classification, measurement and impairment of financial assets and hedge accounting.

The requirements for classification, measurement and impairment of financial assets have been applied retrospectively on January 1, 2018, and the requirements for hedge accounting have been applied prospectively. IFRS 9 is not applicable to items that have already been derecognized on or before December 31, 2017.

Classification, measurement and impairment of financial assets

On the basis of the facts and circumstances that existed on January 1, 2018, the Company performed an assessment of the classifications of financial assets and elected not to restate the comparative figures.

- 7 -

The following table shows the original measurement categories and carrying amounts under IAS 39 and the new measurement categories and carrying amounts under IFRS 9 for each class of the Company’s financial assets and financial liabilities as of January 1, 2018.

		Measurement category				Carrying amount
		IAS 39		IFRS 9		IAS 39				IFRS 9				Note
Financial assets
Cash and cash equivalents		Loans and receivables		Amortized cost		$	28,825			$	28,825				1)
Equity securities		Available-for-sale		Fair value through profit and loss (FVTPL)			54				54				2)
		Available-for-sale		Fair value through other comprehensive income (FVOCI) - equity investments			5,697				7,539				2)
Trade notes and accounts receivable, receivables from related parties, other current monetary assets and refundable deposits		Loans and receivables		Amortized cost		$	40,158			$	40,158				1	)
Financial Liabilities
Short-term loans, trade notes and accounts payable, payables to related parties, partial other payables, customers’ deposit and loan-term loans		Amortized cost		Amortized cost			39,725				39,725
Derivatives		Held-for-trading		FVTPL			1				1
		Hedging derivative financial liabilities		Hedging financial liabilities			1				1				3	)

		IAS 39 Carrying Amount January 1, 2018				Reclassifi- cations				Remea- surements				IFRS 9 Carrying Amount January 1, 2018				Retained Earnings effect on January 1, 2018				Other adjustment effect on January 1, 2018				Noncontrolling interests effect on January 1, 2018				Note
Financial assets measured at FVTPL		$	—			$	—			$	—			$	—			$	—			$	—			$	—
Add:  reclassification from available for sale (IAS 39) - mandatory reclassification			—				54				—				54				6				(6	)			—				2	)
			—				54				—				54				6				(6	)			—
Financial liabilities measured at FVTPL			(1	)			—				—				(1	)			—				—				—
Financial assets measured at FVOCI- equity investments			—				—				—				—				—				—				—
Add:  reclassification from available for sale (IAS 39) - designated at January 1, 2018			—				5,697				1,842				7,539				1,516				327				(1	)			2	)
			—				5,697				1,842				7,539				1,516				327				(1	)
Financial assets measured at Amortized cost			—				—				—				—				—				—				—
Add:  reclassification from loans and receivables (IAS 39)			—				68,983				—				68,983				—				—				—				1	)
			—				68,983				—				68,983				—				—				—
Financial liabilities measured at amortized cost			—				—				—				—				—				—				—
Add:  reclassification from amortized cost (IAS 39)			—				(39,725	)			—				(39,725	)			—				—				—
			—				(39,725	)			—				(39,725	)			—				—				—
Hedging financial liabilities			—				—				—				—				—				—				—
Add:  reclassification from Hedging derivative instrument (IAS 39)			—				(1	)			—				(1	)			—				—				—				3	)
			—				(1	)			—				(1	)			—				—				—
Total		$	(1	)		$	35,008			$	1,842			$	36,849			$	1,522			$	321			$	(1	)

1) Cash and cash equivalents, trade notes and accounts receivable, receivables from related parties, other current monetary assets and refundable deposit that were classified as loans and receivables under IAS 39 are now classified as financial assets measured at amortized cost with assessment of expected credit loss.

2) The Company elected to reclassify equity securities originally classified as available-for-sale under IAS 39 to FVTPL and designated at FVOCI in accordance with IFRS 9. As a result, the related other equity - unrealized gain (loss) on available-for-sale financial assets was reclassified $6 million to retained earnings and $556 million to other equity - unrealized gain or loss on financial assets at FVOCI.

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Equity investments in non-listed stocks previously carried at cost under IAS 39 are designated as FVOCI and remeasured at fair values. As a result, financial assets at FVOCI and other equity - unrealized gain or loss on financial assets at FVOCI were increased by $1,842 million and $1,843 million, respectively, and noncontrolling interest was decreased by $1 million.

The Company recognized impairment loss on certain investments in equity securities previously classified as available-for-sale and measured at cost and the loss was accumulated in retained earnings under IAS 39. Since those investments were designated as financial assets measured at FVOCI under IFRS 9 and no impairment assessment is required, an adjustment was made that resulted in a decrease of $1,516 million in other equity - unrealized gain or loss on financial assets at FVOCI and an increase of the $1,516 million in retained earnings on January 1, 2018.

3) Due to the amendments to the Regulations Governing the Preparation of Financial Reports by Securities Issuers, all derivative and non-derivative financial assets and financial liabilities which were designated as hedging instruments are presented as hedging financial assets and hedging financial liabilities for starting from January 1, 2018.

As the Company expects there is no tax obligations upon the disposal of the available-for-sale financial assets, the deferred income tax liabilities was decreased by $1 million, unrealized gain or loss on available-for-sale financial assets was increased by $4 million and noncontrolling interests was decreased by of $3 million respectively.

b. IFRS 15 “Revenue from Contracts with Customers” and related amendment

IFRS 15 establishes principles for recognizing revenue that apply to all contracts with customers, and supersedes IAS 18 “Revenue”, IAS 11 “Construction Contracts” and a number of revenue-related interpretations.

When applying IFRS 15 and related amendments, the Company allocates the transaction price to each performance obligation identified in the contract on a relative stand-alone selling price basis.

Where the Company enters into transactions which involve both the provision of telecommunications service bundled with products such as handsets, total consideration received from products and telecommunications service in these arrangements is allocated based on each performance obligation’s relative stand-alone selling price. The amount of sales revenue recognized for products is no longer limited to the amount paid by the customer for the products. This will not change the total revenue recognized, but will change the timing of revenue recognition. The Company may recognize more revenue at the beginning of the contract period (i.e., at the time of sale of products), and revenue recognized for telecommunications service in the subsequent contract periods will decrease.

Incremental costs of obtaining contracts will be recognized as an asset to the extent the Company expects to recover those costs. Such asset will be amortized on a basis that is consistent with the transfer to the customer of the goods or services to which the asset relates. Before the application of IFRS 15, the relevant expenditures were recognized as expenses.

IFRS 15 and its related amendments require that when another party is involved in providing goods or services to a customer, the Company is a principal if it controls the specified good or service before that good or service is transferred to a customer. Before the application of IFRS 15, the Company determines whether it is a principal or an agent based on its exposure to the significant risks and rewards associated with the sale of goods or the rendering of services.

Under IFRS 15, the net effect of revenue recognizes, consideration received and receivable is recognized as a contract asset or a contract liability. Before the application of IFRS 15, receivable is recognized or advance receipts and deferred revenue was reduced when revenue was recognized for the contract under IAS 18.

Under IFRS 15, the Company recognized a trade-in liability (other current liabilities) and a right to recover a product (other current assets) when recognizing revenue for the sale with a trade-in right. Before the application of IFRS 15, trade-in right provisions and inventories were recognized when recognizing revenue.

The Company elected to retrospectively apply IFRS 15 to contracts that were not completed on January 1, 2018 and recognized the cumulative effect of the change in the retained earnings on January 1, 2018.

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Impact on items of assets, liabilities and equity

		Carrying amounts before retrospective adjustments as of January 1, 2018				Adjustments Arising from Initial Application				Carrying amounts after retrospective adjustments as of January 1, 2018
Contract assets - current		$	—			$	6,065			$	6,065
Trade notes and accounts receivable, net		$	31,941				(118	)		$	31,823
Inventories		$	8,840				(132	)		$	8,708
Prepayments		$	2,188				(7	)		$	2,181
Other current assets		$	2,183				132			$	2,315
Contract assets - noncurrent		$	—				3,917			$	3,917
Incremental costs of obtaining contracts		$	—				2,474			$	2,474
Total effect on assets						$	12,331
Contract liabilities - current		$	—			$	8,004			$	8,004
Current tax liabilities		$	8,674				2,227			$	10,901
Provisions - current		$	189				(88	)		$	101
Advance receipts		$	8,842				(8,842	)		$	—
Other current liabilities		$	1,081				72			$	1,153
Contract liabilities - noncurrent		$	—				2,626			$	2,626
Deferred revenue		$	3,612				(3,612	)		$	—
Other noncurrent liabilities		$	3,458				1,072			$	4,530
Total effect on liabilities						$	1,459
Total effect on equity (unappropriated earnings)		$	54,633			$	10,872			$	65,505

The following table shows the increase (decrease) in assets, liabilities and equity resulting from the application of IFRS 15 on the balance sheet date.

		March 31, 2018
Contract assets – current		$	6,259
Trade notes and accounts receivable, net			(128	)
Inventories			(115	)
Prepayments – current			(9	)
Other current assets			115
Contract assets – noncurrent			3,588
Incremental costs of obtaining contracts			2,283
Assets		$	11,993

(Continued)

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		March 31, 2018
Contract liabilities - current		$	8,654
Current tax liabilities			2,142
Provisions - current			(77	)
Advance receipts			(9,493	)
Other current liabilities			206
Contract liabilities - noncurrent			2,384
Deferred revenue			(3,393	)
Other noncurrent liabilities			1,063
Liabilities		$	1,486
Equity (unappropriated earnings)		$	10,507

(Concluded)

Impact on items of statement of comprehensive income for current period

		Three months ended March 31, 2018
Revenues		$	(258	)
Operating costs			341
Operating expenses			(149	)
Income from operations			(450	)
Income tax expense			(85	)
Net income		$	(365	)
Decrease in net income attributable to:
Stockholders of the parent		$	(365	)
Noncontrolling interests			—
		$	(365	)
Impact on earnings per share:
Basic earnings per share		$	(0.05	)
Diluted earnings per share		$	(0.05	)

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