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Investments Accounted for Using the Equity Method
 12 Months Ended
Dec. 31, 2017
Text block1 [abstract]  
Investments Accounted for Using the Equity Method
13. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

 

    December 31
   

2016

(Retrospectively Adjusted)

   2017
    NT$   NT$   US$ (Note 4)
             
Investments in associates   $ 49,154,140     $ 48,267,237     $ 1,628,449  
Investments in joint venture     670,550       486,514       16,414  
                         
    $ 49,824,690     $ 48,753,751     $ 1,644,863  

 

a. Investments in associates

 

1) Investments in associates accounted for using the equity method consisted of the following:

 

            Carrying Amount as of December 31
           

2016

(Retrospectively Adjusted)

   2017
        Operating   NT$   NT$   US$
Name of Associate   Main Business   Location           (Note 4)
                     
Material associate                    
  Siliconware Precision Industries Co., Ltd. (“SPIL”)   Engaged in assembly, testing and turnkey services of integrated circuits   ROC   $ 45,898,225     $ 45,210,371     $ 1,525,316  
Associates that are not individually material                                
  Deca Technologies Inc.（”DECA”）   Holding company and the group engaged in manufacturing, development and marketing of wafer level packaging and interconnect technology   British Cayman Islands     1,813,677       1,583,124       53,412  
  Hung Ching Development & Construction Co. (“HC”)   Engaged in the development, construction and leasing of real estate properties   ROC     1,156,833       1,248,711       42,129  
  Hung Ching Kwan Co. (“HCK”)   Engaged in the leasing of real estate properties   ROC     321,120       309,630       10,447  

 

(continued) 

 

            Carrying Amount as of December 31
           

2016

(Retrospectively Adjusted)

   2017
        Operating   NT$   NT$   US$
Name of Associate   Main Business   Location           (Note 4)
                     
  Advanced Microelectronic Products Inc. (“AMPI”)   Engaged in integrated circuit   ROC   $ 264,434     $ 215,550     $ 7,272  
              49,454,289       48,567,386       1,638,576  
    Less: Deferred gain on transfer of land         300,149       300,149       10,127  
                                 
            $ 49,154,140     $ 48,267,237     $ 1,628,449  

 

(concluded)

 

2) At each balance sheet date, the percentages of ownership held by the Group were as follows:

 

    December 31
    2016   2017
         
SPIL     33.29 %     33.29 %
DECA     22.07 %     22.04 %
HC     26.22 %     26.22 %
HCK     27.31 %     27.31 %
AMPI     38.76 %     38.76 %

 

3) In July 2016, the Company acquired 98,490 thousand preferred shares issued by DECA at US$0.608 per share with a total consideration of NT$1,934,062 thousand (US$59,882 thousand). The percentage of ownership was 22.07% and the Company obtained significant influence over DECA. In 2017, the percentage of ownership was decreased to 22.04% since DECA’s share options were exercised. The Company’s subsidiary, ASE Test, Inc., purchased 90,000 thousand ordinary share of AMPI in a private placement with NT$225,000 thousand paid in cash in November 2016. The private-placement ordinary shares were restricted for disposal during a 3-year lock-up period. As a result, the percentage of ownership held by the Group was increased to 38.76%.

 

4) The Group has successively completed the identification of the difference between the cost of the investments and the Group’s share of the net fair value of DECA and AMPI’s identifiable assets and liabilities in the second quarter and the third quarter in 2017. Therefore, the Group has retrospectively adjusted the comparative consolidated financial statements for prior periods. As of December 31, 2016, the retrospective adjustments are summarized as follows:

 

    After Retrospectively Adjusted   Before Retrospectively Adjusted
    NT$   NT$
Investments accounted for using the equity method        
         
December 31, 2016        
DECA   $ 1,813,677     $ 1,820,329  
AMPI   $ 264,434     $ 266,085  

 

The aforementioned retrospective adjustments are accordingly recorded as a decrease of retained earnings as of December 31, 2016.

 

5) Fair values (Level 1 inputs in terms of IFRS 13) of investments in associates with available published price quotation are summarized as follows:

 

    December 31
    2016   2017
    NT$   NT$   US$ (Note 4)
             
SPIL   $ 49,634,805     $ 52,176,190     $ 1,760,330  
HC   $ 1,310,829     $ 1,695,156     $ 57,191  
AMPI   $ 307,038     $ 468,572     $ 15,809  

 

6) Summarized financial information in respect of the Group’s material associate

 

The summarized financial information below represents amounts shown in SPIL’s consolidated financial statements prepared in accordance with IFRSs and adjusted by the Group for equity method accounting purposes.

 

    December 31
    2016   2017
    NT$   NT$   US$ (Note 4)
             
Current assets   $ 50,451,295     $ 49,065,912     $ 1,655,395  
Non-current assets     107,573,251       101,693,417       3,430,952  
Current liabilities     (41,088,439 )     (26,194,615 )     (883,759 )
Non-current liabilities     (17,518,410 )     (27,213,266 )     (918,126 )
                         
Equity   $ 99,417,697     $ 97,351,448     $ 3,284,462  
                         
Proportion of the Group’s ownership interest in SPIL     33.29 %     33.29 %     33.29 %
                         
Net assets attributable to the Group   $ 33,096,151     $ 32,408,297     $ 1,093,397  
Goodwill     12,802,074       12,802,074       431,919  
                         
Carrying amount   $ 45,898,225     $ 45,210,371     $ 1,525,316  

 

    For the Year Ended December 31
    2016   2017
    NT$   NT$   US$ (Note 4)
             
Operating revenue   $ 85,111,913     $ 83,554,385     $ 2,818,974  
Gross profit   $ 15,027,247     $ 12,464,792     $ 420,540  
Profit before income tax   $ 7,351,661     $ 4,347,810     $ 146,687  
                         
Net profit for the year   $ 5,484,462     $ 2,822,231     $ 95,217  
Other comprehensive income (loss) for the year     (2,373,532 )     579,057       19,536  
                         
Total comprehensive income for the year   $ 3,110,930     $ 3,401,288     $ 114,753  
Cash dividends received from SPIL   $ 3,941,740     $ 1,815,275     $ 61,244  
7) Aggregate information of associates that are not individually material

 

    For the Year Ended December 31
    2015   2016   2017
    NT$   NT$   NT$   US$
                (Note 4)
The Group’s share of:                
Net profit (loss) for the year   $ 120,749     $ (139,366 )   $ (190,532 )   $ (6,428 )
Other comprehensive income (loss) for the year     (2,916 )     (115,650 )     59,676       2,013  
                                 
Total comprehensive income (loss) for the year   $ 117,833     $ (255,016 )   $ (130,856 )   $ (4,415 )

 

b. Investments in joint venture

 

1) The Group’s investment in a joint venture that was not individually material and accounted for using the equity method consisted of ASE Embedded Electronics Inc. (“ASEEE”). In May 2015, the Group and TDK Corporation (“TDK”) entered into an agreement to establish a joint venture to invest in ASEEE. The Group additionally participated in ASEEE’s cash capital increase with NT$146,903 thousand in September 2016. As of December 31, 2016 and 2017, the percentages of ownership were both 51%. ASEEE are located in ROC and engaged in the production of embedded substrate. According to the joint arrangement, the Group and TDK must act together to direct the relevant operating activities and, as a result, the Group does not control ASEEE. The investment in ASEEE is accounted for using the equity method.

 

2) Aggregate information of the joint venture that is not individually material

 

    For the Year Ended December 31
    2016   2017
    NT$   NT$   US$ (Note 4)
             
The Group’s share of net loss and total comprehensive loss for the year   $ (90,478 )   $ (184,366 )   $ (6,220 )