Retained Earnings and Dividends Paid

12 Months Ended

Dec. 31, 2022

31.	Retained Earnings and Dividends Paid

(1)	Details of retained earnings as of December 31, 2021 and 2022 are as follows:


		2021		2022

		In millions of won
Legal reserve (*)	￦		1,604,910		1,604,910
Voluntary reserves			33,282,817		27,782,969
Retained earnings (Undisposed deficit) before appropriations			10,370,517		(7,956,579	)

Retained earnings	￦		45,258,244		21,431,300

(*)

The KEPCO Act requires KEPCO to appropriate a legal reserve equal to at least 20 percent of net income for each accounting period until the reserve equals 50 percent of KEPCO’s common stock. The legal reserve is not available for cash dividends; however, this reserve may be credited to

paid-in

capital or offset against accumulated deficit by the resolution of the shareholders.

(2)	Details of voluntary reserves as of December 31, 2021 and 2022 are as follows:


		2021		2022

		In millions of won
Reserve for investment on social overhead capital	￦		5,277,449		5,277,449
Reserve for research and human development (*)			330,000		330,000
Reserve for business expansion			27,465,368		21,965,520
Reserve for equalizing dividends			210,000		210,000

	￦		33,282,817		27,782,969

(*)

The reserve for research and human development is appropriated by KEPCO to use as qualified tax credits to reduce corporate tax liabilities. The reserve is available for cash dividends for a certain period as defined by the Restriction of Special Taxation Act of Korea.

(3)	Changes in retained earnings for the years ended December 31, 2021 and 2022 are as follows:


		2021			2022

		In millions of won
Beginning balance	￦		51,134,330			45,258,244
Loss for the year attributed to owners of the controlling company			(5,304,522	)		(24,466,853	)
Changes in equity method retained earnings			3,609			12,305
Remeasurements of defined benefit liability, net of tax			201,067			626,769
Transfer of gain or loss on valuation of financial assets at FVOCI			4,388			—
Dividends paid			(780,628	)		—
Additional paid-in capital and others			—			835

Ending balance	￦		45,258,244			21,431,300

(4)	Dividends paid for the years ended December 31, 2020, 2021 and 2022 are as follows:


	2020
In millions of won	Number of shares issued		Number of treasury stocks		Number of shares eligible for dividends			Dividends paid per share		Dividends paid

								(In won)
Common shares		641,964,077		—		641,964,077	￦		—		—


	2021
In millions of won	Number of shares issued		Number of treasury stocks		Number of shares eligible for dividends			Dividends paid per share		Dividends paid

								(In won)
Common shares		641,964,077		—		641,964,077	￦		1,216		780,628


	2022
In millions of won	Number of shares issued		Number of treasury stocks		Number of shares eligible for dividends			Dividends paid per share		Dividends paid

								(In won)
Common shares		641,964,077		—		641,964,077	￦		—		—

(5)	Changes in retained earnings of investments in associates and joint ventures for the years ended December 31, 2021 and 2022 are as follows:


		2021		2022

		In millions of won
Beginning balance	￦		361		3,970
Changes			3,609		12,305

Ending balance	￦		3,970		16,275

(6)	Changes in remeasurement components related to defined benefit liability for the years ended December 31, 2021 and 2022 are as follows:


		2021			2022

		In millions of won
Beginning balance	￦		(169,234	)		98,844
Changes			327,957			964,791
Income tax effect			(126,890	)		(338,022	)
Transfer to reserve for business expansion			67,011			(110,808	)

Ending balance	￦		98,844			614,805