Additional Information of Expenses by Nature

12 Months Ended

Dec. 31, 2020

Additional Information of Expenses by Nature

30.	ADDITIONAL INFORMATION OF EXPENSES BY NATURE


	Years Ended December 31
	2018		2019		2020
	NT$		NT$		NT$
	(In Millions)		(In Millions)		(In Millions)
a. Depreciation of property, plant and equipment and right-of-use assets

Recognized in cost of revenue	$	264,804.7	$	256,530.9	$	299,311.4
Recognized in operating expenses		23,292.3		24,856.7		25,191.3
Recognized in other operating income and expenses		27.9		24.2		35.7


	$	288,124.9	$	281,411.8	$	324,538.4

b. Amortization of intangible assets

Recognized in cost of revenue	$	2,073.5	$	3,069.9	$	4,837.7
Recognized in operating expenses		2,347.9		2,402.5		2,348.5


	$	4,421.4	$	5,472.4	$	7,186.2

c. Employee benefits expenses

Post-employment benefits
Defined contribution plans	$	2,568.9	$	2,609.7	$	2,809.5
Defined benefit plans		281.8		259.6		204.9

		2,850.7		2,869.3		3,014.4
Other employee benefits		105,364.2		107,115.3		137,803.0

	$	108,214.9	$	109,984.6	$	140,817.4


Employee benefits expense summarized by function
Recognized in cost of revenue	$	63,597.7	$	64,702.0	$	83,099.0
Recognized in operating expenses		44,617.2		45,282.6		57,718.4


	$	108,214.9	$	109,984.6	$	140,817.4

According to TSMC’s Articles of Incorporation, TSMC shall allocate compensation to directors and profit sharing bonus to employees of TSMC not more than 0.3% and not less than 1% of annual profits during the period, respectively.


TSMC accrued profit sharing bonus to employees based on a percentage of net income before income tax, profit sharing bonus to employees and compensation to directors during the period; compensation to directors was expensed based on estimated amount payable. If there is a change in the proposed amounts after the annual consolidated financial statements are authorized for issue, the differences are recorded as a change in accounting estimate. Accrued profit sharing bonus to employees is illustrated below:
	Years Ended December 31
	2018		2019		2020
	NT$		NT$		NT$
	(In Millions)		(In Millions)		(In Millions)
Profit sharing bonus to employees	$	23,570.0	$	23,165.7	$	34,753.2

TSMC’s profit sharing bonus to employees and compensation to directors for 2018, 2019 and 2020 had been approved by the Board of Directors of TSMC, as illustrated below:
	Years Ended December 31
	2018		2019		2020
	NT$		NT$		NT$
	(In Millions)		(In Millions)		(In Millions)
Resolution Date of TSMC’s Board of Directors in its meeting		February 19, 2019		February 11, 2020		February 9, 2021
Profit sharing bonus to employees	$	23,570.0	$	23,165.7	$	34,753.2

Compensation to directors	$	349.3	$	360.4	$	509.8

There is no significant difference between the aforementioned approved amounts and the amounts charged against earnings of 2018, 2019 and 2020, respectively