XML 48 R28.htm IDEA: XBRL DOCUMENT v3.5.0.2
Condensed Financial Information of Deswell Industries, Inc.
 12 Months Ended
Mar. 31, 2016
Condensed Financial Information of Parent Company Only Disclosure [Abstract]  
Condensed Financial Information of Deswell Industries, Inc.

21. Condensed Financial Information of Deswell Industries, Inc.

 

The condensed financial statements of Deswell Industries, Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America. Under the PRC laws and regulations, Deswell Industries, Inc’s PRC subsidiaries are restricted in their ability to transfer certain of their net assets to Deswell Industries, Inc. in the form of dividend payments, loans or advances. The amounts restricted include paid-in capital and statutory reserves, as determined pursuant to PRC generally accepted accounting principles, totaling $76,674 (equivalent to RMB 479 million) and $72,890 (equivalent to RMB 479 million) as of March 31, 2015 and 2016, respectively.

 

Balance sheets

              March 31,
   2015  2016
Assets          
           
Current assets:          
Cash and cash equivalents  $1,369   $294 
Prepaid expenses and other current assets   76    76 
Amounts due from subsidiaries   35,633    33,462 
Total current assets   37,078    33,832 
Investments in subsidiaries   48,360    44,861 
Property, plant and equipment-net   56    17 
Total assets  $85,494   $78,710 
           
Liabilities and shareholders’ equity          
 Current liabilities:          
Accrued payroll and employee benefits  $1,315   $1,226 
Other accrued liabilities   116    114 
Dividend payable   —      562 
Total current liabilities   1,431    1,902 
Total shareholders’ equity   84,063    76,808 
Total liabilities and shareholders’ equity  $85,494    78,710 
           

 

Statements of comprehensive loss

 

    Year ended March 31,
    2014   2015   2016
Equity in loss of subsidiaries  $(5,213)  $(1,120)  $(3,426)
Operating expenses   2,277    1,688    1,508 
Loss before income taxes   (7,490)   (2,808)   (4,934)
Income taxes   —      —      —   
Net loss   (7,490)   (2,808)   (4,934)
Share of other comprehensive income/(loss) of subsidiaries   57    33    (73)
Total comprehensive loss  $(7,433)  $(2,775)  $(5,007)
                

 

Statements of cash flows

    Year ended March 31,
    2014   2015   2016
Cash flows from operating activities               
Net loss  $(7,490)  $(2,808)  $(4,934)
Adjustments to reconcile net loss to net cash
provided by operating activities:		               
Equity in loss of subsidiaries   5,213    1,120    3,426 
Depreciation   87    87    39 
Stock-based compensation expenses   —      199    —   
Changes in operating assets and liabilities:               
Prepaid expenses and other current assets   5    —      —   
Amounts due from subsidiaries   7,533    3,956    2,171 
Accrued payroll and employee benefits   561    —      (89)
Other accrued liabilities   (30)   47    (2)
Net cash provided by operating activities   5,879    2,601    611 
                
Cash flows from investing activities               
Purchase of property, plant and equipment   —      —      —   
Net cash used in investing activities   —      —      —   
                
Cash flows from financing activities               
Dividends paid   (3,615)   (2,971)   (1,686)
Exercise of stock options   493    —      —   
Repurchase of common stock   (1,411)   —      —   
Net cash used in financing activities   (4,533)   (2,971)   (1,686)
                
Net (decrease) increase in cash and cash equivalents   1,346    (370)   (1,075)
Cash and cash equivalents, beginning of year   393    1,739    1,369 
Cash and cash equivalents, end of year  $1,739   $1,369   $294 
                

 

a)Basis of presentation

 

In Deswell Industries, Inc. - only financial statements, Deswell Industries, Inc.’s investments in subsidiaries are stated at cost plus its equity interest in undistributed earnings of subsidiaries since inception. Accordingly, such financial statements should be read in conjunction with the Company’s consolidated financial statements.

 

Deswell Industries, Inc. records its investments in its subsidiaries under the equity method of accounting as prescribed in ASC 323 “Investment-Equity Method and Joint Ventures”. Such investment is presented on the balance sheets as “Investments in subsidiaries” and share of the subsidiaries’ profit or loss as “Equity in earnings (loss) of subsidiaries”, on the statements of comprehensive loss.

 

The subsidiaries paid dividends of $nil, $nil and $nil to Deswell Industries, Inc. for the years ended March 31, 2014, 2015 and 2016, respectively.

 

Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted.

 

 

b)Related party transactions

 

For the years ended March 31, 2014, 2015 and 2016, related party transactions mainly composed of $120, $120 and $120 paid to Jetcrown Industrial (Macao Commercial Offshore) Limited as service fee for each year.