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Annual Report of Celltrion Holdings in 2014

From 1 January 2014


To
31 December 2014

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Contents
Audit Report ...................................................................................................................... ..2
Independent Audit Report...................................................................................................... ..4
(Appendix) Consolidated Financial Statement ........................................................................................ ..8
Notes ...............................................................................................................................22
External Audit Content.............................................................................................................120

5
2014 01 01

2014 12 31

4
2013 01 01

2013 12 31

Celltrion Holdings and its subsidiaries

Audit Report of Consolidated Financial Statements

5th Period
From 1 Jan 2014
to
31 Dec 2014

4th Period
From 1 Jan 2013
to
31 Dec 2013

SamYoung Accounting Corporation



16

2015 3

.
2014 12 31 2013 12 31
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.
.

.
.
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.
.

Independent Audit Report

Celltrion Holdings Company Ltd.


To the Board of Directors and Shareholders

16 March 2015

We have audited the consolidated financial statement of Celltrion Holdings Co, Ltd. and its subsidiaries. This
statement consists of the balance sheets, consolidated income statements, consolidated statements of owners
equity, statements of cash flow, accounting policies and instructions which are from 1 Jan 2013 to 31 Dec 2013
and from 1 Jan 2014 to 31 Dec 2014.
The responsibilities of management in the consolidated financial statement
The management completed this financial statement in accordance with the K-IFRS and should be responsible
for not only the fairness of the statement but also the internal control which ensures the consolidated financial
statement is free of material misstatements.
The responsibilities of the auditors
Our responsibility is giving our opinion on the consolidated financial statement based on our audit. We have
audited the statement and strictly followed the Korean Auditing Standards for general Korean Enterprises. Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatements.
The audit consists of procedures confirming the figures and disclosures of relevant evidence in consolidated
financial statements. The judgements of different auditors might vary, which causes differing choices of audit
procedures and leads to serious misstatements in the consolidated financial statement. So, when evaluating this
risk, auditors should consider the tabulation of the consolidated financial statement and the internal control in
order to design a suitable audit procedure. However, the audit procedure is not for giving opinions on the
effectiveness of internal control. The audit is an evaluation on not only the consolidated financial statement, but
also the adaptability of accounting policies and the reasonableness of the accounting estimates. We believe the
audit evidence we received as the reference to audit opinions are adequate and suitable.


2014 12
31 2013 12 31
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2013 12 31
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131

8,

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.

We believe that the acquired audit evidences are enough and appropriate for the auditing.
Audit opinion
The consolidated financial statements of Celltrion Holdings Co, Ltd., including the balance sheets, consolidated
income statements, consolidated statements of owners equity, statements of cash flow, accounting policies and
instructions which are from 1 Jan 2013 to 31 Dec 2013 and from 1 Jan 2014 to 31 Dec 2014, are free of material
misstatement, according to the K-IFRS and the materiality principle.
Other information

The consolidated financial statements of Celltrion Holdings Co, Ltd. and its subsidiaries (until 31 Dec 2013)
are audited under the former audit principle.

Nobel 2 Building, 131-8, Seon Rong Road, Gangnam-gu, Seoul


SamYoung Accounting Corporation
Legal Representative: Kimdaugi

This report is effective until the audit report day. Certain subsequent events or circumstances,
which may occur between the audit report date and the time of reading this report, could have a
material impact on the accompanying consolidated finical statements and notes thereto.
Accordingly, the readers of the audit report should understand that there is a possibility that the
above audit report may have to be revised to reflect the impact of such subsequent events or
circumstances, if any.

()

5
2014 01 01

2014 12 31

4
2013 01 01

2013 12 31

" ."

()
( )

43
032-850-6464

(Appendix) Consolidated Financial Statement

Celltrion Holdings and its subsidiaries

5th Period
From 1 Jan 2014
To
31 Dec 2014

4th Period
From 1 Jan 2013
To
31 Dec 2013

The consolidated financial statement in the appendix is tabulated by Celltrion Holdings


Celltrion Holdings Legal Representative: Seo Jung Jin

Headquarter: (Address) 43 Seong Ma Road, Nam Dong District, Incheon City


(Tel) 032-850-6464

5 2014 12 31
4 2013 12 31

I.

( : )
5 ()

4 ()

16,753,363,598

23,735,624,365

4,5

956,345,049

1,650,342,077

4,6,32

433,883,656

4,349,545,249

14,855,295,215

15,119,749,356

507,839,678

2,615,987,683

343,807,584,534

315,218,282,233

500,001,882

500,001,882

9,31,32

321,533,137,258

292,924,581,756

3.

10

13,386,047,718

12,840,311,244

4.

11

1,377,382,097

2,124,340,906

4,12

1,031,801,519

1,134,380,329

13

5,979,214,060

5,694,666,116

360,560,948,132

338,953,906,598

233,226,643,556

229,237,490,792

4,14,31

22,876,043,922

24,820,012,084

4,14,31,32

203,164,800,117

193,708,926,232

76,523,330

2,138,004,612

7,109,276,187

8,527,325,477

1.
2.
3.

4,6,31,32

4.

II.
1.

4,8

2.

5.
6.

I.
1.
2.
3.

4,15

4.

4,15,32

5.

16

22,550,000

6.

17

20,672,387

81,892,833,963

72,986,661,573

48,685,447,595

45,163,135,049

78,261,000

II.
1.

4,14,31

2.

4,18

3.

19

109,828,420

276,778,082

4.

23

33,079,057,948

27,468,487,442

5.

17

18,500,000

315,119,477,519

302,224,152,365

I.
1.

20

1,500,000,000

1,500,000,000

2.

20

37,978,130,633

37,978,130,633

3.

20

2,038,212,237

2,038,212,237

Consolidated Balance Sheet

5th Period as of 31 Dec 2014


4th Period as of 31 Dec 2013
Celltrion Holdings Co., Ltd. and its subsidiaries
Accounting Subject

Notek

(Unit: KRW)

5th Period

4th Period

Assets
I. Current assets

16,753,363,598

23,735,624,365

4,5

956,345,049

1,650,342,077

4,6,32

433,883,656

4,349,545,249

14,855,295,215

15,119,749,356

507,839,678

2,615,987,683

343,807,584,534

315,218,282,233

500,001,882

500,001,882

9,31,32

321,533,137,258

292,924,581,756

3. Tangible assets

10

13,386,047,718

12,840,311,244

4. Intangible assets

11

1,377,382,097

2,124,340,906

4,12

1,031,801,519

1,134,380,329

13

5,979,214,060

5,694,666,116

360,560,948,132

338,953,906,598

233,226,643,556

229,237,490,792

4,14,31

22,876,043,922

24,820,012,084

4,14,31,32

203,164,800,117

193,708,926,232

76,523,330

2,138,004,612

7,109,276,187

8,527,325,477

1. Cash and cash equivalents


2. Accounts receivable
3. Loans and other receivables
4. Other current assets

4,6,31,32
7

II. Non-current assets


1. Available-for-sale financial assets
2. Investments

5. Other long-term receivables


6. Other non-current assets

4,8

Total assets
Liabilities
I. Current liabilities
1. Financial liabilities at fair value
through profit or loss
2. Short-term financial liabilities
3. Accounts payable

4,15

4. Other accrued liabilities

4,15,32

5. Other current liabilities

16

22,550,000

6. Provisions

17

20,672,387

81,892,833,963

72,986,661,573

48,685,447,595

45,163,135,049

78,261,000

19

109,828,420

276,778,082

4. Deferred tax liabilities

23

33,079,057,948

27,468,487,442

5. Provisions

17

18,500,000

315,119,477,519

302,224,152,365

II. Non-current liabilities


1. Long-term financial liabilities
2. Other long-term payment
obligations
3. Defined benefit obligation

4,14,31
4,18

Total liabilities
Equity
I. Ownership of the consolidated
1. Capital

20

1,500,000,000

1,500,000,000

2. Capital surplus

20

37,978,130,633

37,978,130,633

3. Other capital

20

2,038,212,237

2,038,212,237

10

4.

20

(11,349,644,095)

(16,728,503,406)

5.

21

15,274,771,838

12,721,817,930

(779,903,161)

45,441,470,613

36,729,754,233

360,560,948,132

338,953,906,598

II.

11

4. Other accumulated comprehensive


income

20

(11,349,644,095)

(16,728,503,406)

5. Retained earnings

21

15,274,771,838

12,721,817,930

(779,903,161)

45,441,470,613

36,729,754,233

360,560,948,132

338,953,906,598

II. Non-controlling interests


Total equity
Total liabilities and equity

The accompanying notes are an integral part of the consolidated financial statements.

12

5 2014 01 01 2014 12
31 4 2013 01 01 2013
12 31

( : )

I.
II.

4 ()

9,24,32

34,741,852,263

53,668,934,602

24,26,29,32

12,945,545,935

39,425,391,619

21,796,306,328

14,243,542,983

4,455,900,735

4,242,388,936

17,340,405,593

10,001,154,047

III.
IV.

5 ()

25,26,29,32

V.
VI.

27

209,455,164

311,447

VII.

6,27

686,340,162

1,863,202,361

VIII.

28,32

2,876,213,536

15,959,985,698

IX.

28,32

15,244,467,430

74,353,956,406

4,495,266,701

(50,255,707,575)

4,093,456,341

252,152,724

401,810,360

(50,507,860,299)

885,223,989

(50,507,860,299)

(483,413,629)

2,951

(168,360)

X. ()
XI.

23

XII. ()
1.
2.
XIII.

22

()
.

13

Consolidated Income Statement


5th Period from 1 Jan 2014 to 31 Dec 2014
4th Period from 1 Jan 2013 to 31 Dec 2013
Celltrion Holdings Co., Ltd. and its subsidiaries
Accounting Subject
I. Revenue
II. Cost of goods sold

(Unit: KRW)
Note

4th Period

9,24,32

34,741,852,263

53,668,934,602

24,26,29,32

12,945,545,935

39,425,391,619

21,796,306,328

14,243,542,983

4,455,900,735

4,242,388,936

17,340,405,593

10,001,154,047

III. Gross profit


IV. Selling and administrative expenses

5th Period

25,26,29,32

V. Operating profit
VI. Other income

27

209,455,164

311,447

VII. Other costs

6,27

686,340,162

1,863,202,361

VIII. Financial income

28,32

2,876,213,536

15,959,985,698

IX. Financial expenses

28,32

15,244,467,430

74,353,956,406

4,495,266,701

(50,255,707,575)

4,093,456,341

252,152,724

401,810,360

(50,507,860,299)

885,223,989

(50,507,860,299)

(483,413,629)

2,951

(168,360)

X. Income before tax (loss)


XI. Income tax

23

XII. Net income (loss)


1. Ownership of the consolidated
company
2. Non-controlling interests
XIII. Loss per share for the ownership
of the consolidated company
Net income per share (loss)

22

The accompanying notes are an integral part of the consolidated financial statements.

14


5 2014 01 01 2014 12
31 4 2013 01 01 2013
12 31

( : )

I. ()
II.

5 ()

4 ()

401,810,360

(50,507,860,299)

5,454,509,488

(16,429,008,978)

75,650,177

(31,305,923)

(8,258,499,022)

5,378,859,311

(8,139,204,033)

5,856,319,848

(66,936,869,277)

6,339,733,477

(66,936,869,277)

(483,413,629)


III.

9,20

15

Consolidated Comprehensive Income Statement


5th Period from 1 Jan 2014 to 31 Dec 2014
4th Period from 1 Jan 2013 to 31 Dec 2013
Celltrion Holdings Co., Ltd. and its subsidiaries
Accounting Subject

(Unit: KRW)
Note

I. Net income (loss)


II. Other comprehensive income

5th Period

4th Period

401,810,360

(50,507,860,299)

5,454,509,488

(16,429,008,978)

75,650,177

(31,305,923)

(8,258,499,022)

5,378,859,311

(8,139,204,033)

5,856,319,848

(66,936,869,277)

6,339,733,477

(66,936,869,277)

(483,413,629)

Divisions that are not subsequently reclassified to


profit or loss
Remeasurement of the net defined benefit liability
component
Divisions that can subsequently be reclassified to
profit or loss
Available-for-sale financial assets, gains
Other comprehensive income of related enterprise
equity
III. Total net comprehensive income
Ownership of the consolidated company
Non-controlling interests

9,20

The accompanying notes are an integral part of the consolidated financial statements.

16


5 2014 01 01 2014 12
31 4 2013 01 01 2013
12 31

( : )

2013.1.1 ()

1,500,000,000

37,978,130,633

1,966,563,478

(330,800,351)

62,785,705,089

103,899,598,849

475,279,063

(779,903,161)

(304,624,098)

(50,507,860,299)

(50,507,860,299)

(31,305,923)

(31,305,923)

(8,258,499,022)

(8,258,499,022)

(8,139,204,033)

(8,139,204,033)

71,648,759

71,648,759

2013.12.31 ()

1,500,000,000

37,978,130,633

2,038,212,237

(16,728,503,406)

12,721,817,930

(779,903,161)

36,729,754,233

2014.1.1 ()

1,500,000,000

37,978,130,633

2,038,212,237

(16,728,503,406)

12,721,817,930

(779,903,161)

36,729,754,233

()

885,223,989

(483,413,629)

401,810,360

75,650,177

75,650,177

5,378,859,311

5,378,859,311

1,592,079,742

1,263,316,790

2,855,396,532

1,500,000,000

37,978,130,633

2,038,212,237

(11,349,644,095)

15,274,771,838

45,441,470,613

2014.12.31 ()

17

Consolidated statement for Change in Equity


5th Period From 1 Jan 2014 to 31 Dec 2014
4th Period From 1 Jan 2013 to 31 Dec 2013
Celltrion Holdings Co., Ltd. and its subsidiaries

(Unit: KRW)

Ownership of the Consolidated Company


Accounting Subject

1 Jan 2013 (Reported


amounts)

Capital

Capital Surplus

Non-controlling
Interests

Other Accumulated
Comprehensive Income

Other Capital

Total Equity

Retained Earnings

1,500,000,000

37,978,130,633

1,966,563,478

Scope of consolidation
changes

475,279,063

Net loss

(50,507,860,299)

(50,507,860,299)

Remeasurement of the net


defined benefit liability
component

(31,305,923)

(31,305,923)

Loss on valuation of
available-for-sale financial
assets

(8,258,499,022)

(8,258,499,022)

Other comprehensive income


of related enterprise equity

(8,139,204,033)

(8,139,204,033)

Conversion price

71,648,759

71,648,759

31 Dec 2013 (until Previous


Accounting Period)

1,500,000,000

37,978,130,633

2,038,212,237

(16,728,503,406)

12,721,817,930

(779,903,161)

36,729,754,233

1 Jan 2014 (Reported


amounts)

1,500,000,000

37,978,130,633

2,038,212,237

(16,728,503,406)

12,721,817,930

(779,903,161)

36,729,754,233

Net income (loss)

885,223,989

(483,413,629)

401,810,360

Remeasurement of the net


defined benefit liability
component

75,650,177

75,650,177

Other comprehensive income


of related enterprise equity

5,378,859,311

5,378,859,311

Scope of consolidation
changes

1,592,079,742

1,263,316,790

2,855,396,532

1,500,000,000

37,978,130,633

2,038,212,237

15,274,771,838

45,441,470,613

31 Dec 2014 (until the


current accounting period)

(330,800,351)

(11,349,644,095)

62,785,705,089

(779,903,161)

103,899,598,849

(304,624,098)

The accompanying notes are an integral part of the consolidated financial statements.

18

5 2014 01 01 2014 12
31 4 2013 01 01 2013
12 31

( : )
5 ()

I. ( 30)
1.

(2,535,834,995)

(5,272,244,468)

(2,535,834,995)

II.
1.

4 ()

(5,272,244,468)
646,521,168

58,467,197,663

922,865,963

102,013,816,127

82,147,239

651,473,165

30,820

542,110,200

633,983,904

30,761,190,000

69,963,283,546

132,360,000

50,650,000

74,344,000

45,109,216

(276,344,795)

(43,546,618,464)

(25,770,000)

(38,697,647,150)

(115,900,000)

(1,882)

(135,248,910)

(4,069,432)

(21,000,000)

(10,000,000)

(4,719,000,000)

(20,672,387)

(73,653,498)






2.

III.

1,195,316,799

(97,453,283,239)

1.

89,210,000,000

126,446,264,528

89,210,000,000

126,446,264,528

2.

(88,014,683,201)

(223,899,547,767)

(10,346,683,202)

(12,453,540,824)

(77,667,999,999)

(190,109,482,801)

(21,336,524,142)

IV.

(693,997,028)

(44,258,330,044)

V.

1,650,342,077

45,908,672,121

VI.

956,345,049

1,650,342,077

19

Consolidated Statement of Cash Flows


5th Period from 1 Jan 2014 to 31 Dec 2014
4th Period from 1 Jan 2013 to 31 Dec 2013
Celltrion Holdings Co., Ltd. and its subsidiaries
(Unit: KRW)
Accounting Subject

5th Period

I. Cash flows from operating activities (Note30)


1. Cash generated from operations

(2,535,834,995)
(2,535,834,995)

II. Cash flows from investing activities


1. Cash inflows from investing activities

4th Period
(5,272,244,468)
(5,272,244,468)
646,521,168

58,467,197,663

922,865,963

102,013,816,127

82,147,239

651,473,165

30,820

542,110,200

633,983,904

30,761,190,000

69,963,283,546

132,360,000

50,650,000

74,344,000

45,109,216

2. Cash outflow from investing activities

(276,344,795)

(43,546,618,464)

Increase in loans and other receivables

(25,770,000)

(38,697,647,150)

Other increases in long-term receivables

(115,900,000)

The increase in available-for-sale financial assets

(1,882)

Interest received
Dividends received
Decrease in loans and other receivables
Reduction of investment
Other decrease in long-term receivables
Disposal of tangible assets
Increase in cash due to changes in scope of
consolidation

Acquisition of tangible assets

(135,248,910)

(4,069,432)

(21,000,000)

(10,000,000)

(4,719,000,000)

Reduction of the recovered Provisions

(20,672,387)

Cash decrease due to consolidation scope changes

(73,653,498)

Acquisition of intangible assets


Increase in other non-current assets

III. Cash flow from financing activities

1,195,316,799

(97,453,283,239)

1. Cash inflows from financing activities

89,210,000,000

126,446,264,528

Increases in short-term financial liabilities

89,210,000,000

126,446,264,528

2. Cash outflows from financing activities

(88,014,683,201)

(223,899,547,767)

Interest payments

(10,346,683,202)

(12,453,540,824)

Decrease in short-term financial liabilities

(77,667,999,999)

(190,109,482,801)

Reduction of long-term financial liabilities

(21,336,524,142)

IV. Decrease in cash and cash equivalents

(693,997,028)

(44,258,330,044)

V. Base Cash and cash equivalents

1,650,342,077

45,908,672,121

956,345,049

1,650,342,077

VI. Ending cash and cash equivalents

Accompanying notes are an integral part of the consolidated financial statements.


20


5 2014 1 1 2014 12 31
4 2013 1 1 2013 12 31

1.

( '')

'') .

.
2010 11 25 .
, ,
(98.86%).
.

.
(%)

100.00

12

62.07

12

2014.12.31

2013.12.31

100.00
-

()
()(*)

(*) ()
.
.

()

21

Notes

5th Period from 1 Jan 2014 to 31 Dec 2014


4th Period from 1 Jan 2013 to 31 Dec 2013

Celltrion Holdings and its subsidiaries


1.

General Standing

The general standing of Celltrion Holdings Inc. (abbreviated as the Company) and its subsidiaries and other
related enterprises are as follows:

A.

Introduction of the Celltrion Holdings

Celltrion Holdings was established on 25 November 2010 after spinning off from Celltrion Healthcare. It is a
holding corporation, specializing in the investment business. The Company is located in Guwol-dong, Namdonggu, Incheon. The principal shareholder is Seo Jung-jin (98.86%).

B.

The current situation of the subsidiaries of Celltrion Holdings

As of the end of this reporting period, the situation is as follows:

Subsidiaries

Share Holdings (%)


31 Dec 2014

31 Dec 2013

Location

Settlement

Sector

Dream E&M

100.00

100.00

Korea

December

My work program

Celltrion ST

62.07

Korea

December

System integration
services

(*)In The current accounting period, Celltrionst reduced all its legal capital without any refunds. Celltrion
Holdings would not hold shares of Celltrionst. Therefore, Celltrion ST was excluded from Celltrion Holdings and
its subsidiaries.
C. The changes in the scope of the consolidated statement
The following company is excluded from the consolidated statement of the current
period
Company Name
Celltrion ST

Reason
Loss control due to capital decrease

22

.
( : ).
()

()

8,222,638

5,592,147

2,630,491

13,045,894

8,025,483

5,020,411

18,010,512

2,830,197

2,861,503

1,880,817

3,936,995

(2,056,178)

3,068,101

2,485,887

2,485,887

11,700,771

2,465,571

2,389,921

()

()
()

2.
. ,
.
.
.
("IASB")
.
,
.
3 .

23

D. Financial Information of subsidiaries


The summary statements of financial positions and comprehensive income of the subsidiaries in the
consolidated statement are as follows
(Current period)
Division
Dream E&M
Corp.

Assets

Liabilities

8,222,638

5,592,147

Equity
2,630,491

Revenue
11,700,771

Net Loss

Total
(comprehensive)

2,465,571

2,389,921

(Previous period)
Assets

Dream E&M
Corp.

13,045,894

8,025,483

5,020,411

18,010,512

2,830,197

2,861,503

Celltrion ST

1,880,817

3,936,995

(2,056,178)

3,068,101

2,485,887

2,485,887

2.

Liabilities

Equity

Revenue

Net Loss

Total
Comprehensive
loss

Division

Important Accounting Policies

The principal accounting policies applied in the consolidated financial statement are as follows. Without
otherwise being specified, the accounting policies will be applied in this accounting period.
A.

The accounting policies applied to the preparation of the consolidated financial statements.

The preparation of the consolidated financial statement was based on Korea International Financial Reporting
Standards (K-IFRS). K-IFRS are the standards and policies that are formulated by the International Accounting
Standards Board (IASB) and adopted by Korea.
K-IFRS allows the use of important accounting estimates when preparing the corporations consolidated financial
statement, and requires the management to estimate the applicability of the accounting policies. As for
complicated matters, information based on subjective judgments and hypotheses, the relevant requirements
and detailed descriptions will be given in Note 3.

24

.
(1)

2014 1 1
.
- 2121 ''

2121 '' ,

. .
- 1102 ''

1102 '' ,
. 2014 7 1
.
.
- 1032 ':'

1032 ':'


.
- 1036 ''

1113 1036
.

25

B.

Disclosure of changes in accounting policy

(1) The revised accounting policies applied to the consolidated company


The consolidated company applied the following revised accounting policies in the accounting period starting
from 1 Jan 2014.

The explanation of the corporate accounting standard, No.2121, Liability


Explanation No.2121: The definition of liabilities applies to the relevant liabilities imposed by the government.
Liabilities will be confirmed with the occurrence of the present liabilities which would cause economically
beneficial outflows. There wouldnt be any significant impact on the consolidated financial statement due to
being applicable to this explanation.

The revision of the No.1102 accounting standards: share-based payment.


The No.1102 article of the corporate accounting standards: the revision of the regulation of share-based
payment defines the acquiring condition of the share-based payment, such as the definition of the
performance conditions and the service conditions. This accounting standard is applicable to share-based
payment transactions after 1 July 2014. There wouldnt be any significant impact on the consolidated
financial statement due to being applicable to this explanation.
No.1032 article of the corporate accounting standard: the revision of the disclosure of financial
instruments
According to the revision of financial instruments, the transactions or accounts can be settled with net
amounts when it meets all of the requirements: being unaffected by future events, implementing the set-off
rights legally at any time and being disclosed with the net amount.

No.1036 article of corporate accounting standard: the revision of the impairment loss of assets
No.1113 article of the corporate accounting standard deleted some disclosures about the probability of
recovering cash-generating units from the former No.1036 article.

26

- 1039 ': '


1039 ': ' (novation)
. ,
,
.
(2)
2014 1 1
, .
- 1019 ''
1019 ''
3
. 2014 7 1 ,
.
.
.
1110 ''
. (1)
.
,
, .
, .

27

No.1039 article of corporate accounting standard: the revision of the recognition and measurement of
financial instruments

In No.1039 article of corporate accounting standard, the revision of the recognition and measurement of
financial instruments, the content of subsequent measurements of financial derivatives and hedging

instruments was revised. According to the revision, financial derivatives are allowed to maintain their functions
as tools of hedging instruments when transferred to the Central Cleaning House according to relevant laws and
regulations.

(2) The revised accounting standards which are not applicable to the Group.
After 1 Jan 2014, the consolidated company formulated and published the revised accounting standards which
are not being implemented or being inapplicable in this early accounting period.

No.1019 article of corporate accounting standard: the revision of the employee salaries

For the company that implements defined contribution plans, the simplified approach could be used for
accounting treatments if donations are from employees or a third party. This standard is planned to be
implemented from 1 July 2014, and the company can adjust its financial statements throughout that whole year.
The consolidated financial statements might not be influenced by this act.

A. Business combination
The company prepared the consolidated financial statement in accordance with No.1110 of the corporation
accounting standard.
(1) Subsidiaries
The control to subsidiaries means that the consolidated company has the right to enjoy the profit change of its
invested companies and can exert influence on their profitability. The subsidiaries can be included into the
consolidated financial statement only when the consolidated company can exert influence on them.

28

. ,

.
.
. .
,

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.
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.
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(2)
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.

.

29

The acqusition method is adopted when the Group is measured initially. The payment consideration is measured
at the fair value on the acquisition date, and its initially measured through the fair value of recognizable assets,
recognizable liabilities and contingent liabilities which are from the combination compiled on the acquisition date.
The minority equity of the Company, which was liquidated, was measured at fair value or the proportion of the
corresponding net assets. Moreover, if not specified, the minority equity is measured at fair value. The relevant
transaction fees of acquisition can be recognized as current profits and losses.
The goodwill can be measured at the balance between the transfer consideration and the fair value of the
recognizable assets that are acquired by the acquiring entity. If the transfer consideration is less than the fair
value of the net assets of the acquiree, the balance should be accounted into current profits and losses.
The balance of liabilities, incomes, fees, and unrealized profits caused by internal transactions among the Group
and its subsidiaries should be canceled out. And if the accounting policies are different among the Group and its
subsidiaries, the consolidated financial statement should be adjusted.
When the Group loses control of its subsidiaries, the measurement of remaining equity should be based on the
fair value of that equity. The balance between book value and fair value should be recognized as current profits
and losses.

(2) Associate companies


The associate companies are the ones that the consolidated company has a significant influence on. The
investment in associate companies is initially measured at acquisition cost, and the equity method is used. The
unrealized profits from transactions between the associate companies and the consolidated company are
eliminated to the extent of its proportional interest. If there are objective evidence indicating the existence of
loss related to the investment on associate companies, the balance between the recoverable value and the
book value of the investment should be recognized as an impairment loss.

30

.
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31

B.

Cash and cash equivalents

Cash, demand deposits, and the financial assets that are of high liquidity, slight risk of changes in value, and the
maturity date from the date of acquisition within three months are classified as cash and cash equivalents by the
Group. Although the equity is excluded from cash and cash equivalents, the short-term preferred stocks with
fixed redemption dates and short periods between the acquisition date and the redemption date are also
included in the scope of cash equivalents.
C.

Conversion of foreign currency

(1) Functional currency and quoted currency


When measuring the subjects in individual financial statements within the scope of consolidated financial
statements, the Company uses the currency (functional currency) which is applied to operating activities in
certain economic conditions. The functional currency of the consolidated company is KRW, so the consolidated
financial statements are all shown in KRW.
(2) Foreign currency transactions and amortized computations at the end of the reporting period.
Foreign currency transactions adopt the exchange rates on the exchange date or the re-calculated exchange rate.
Exchange gains or losses are recognized as current profits and losses when they arise from the settlement or the
translation of assets and liabilities. Exchange gains or losses are seen as part of variable losses and profits of the
fair value when they arise from non-monetary financial assets and liabilities and they will be recognized as
current profits and losses, together with exchange gains or losses (relevant to financial assets) which are
measured by fair value and the changes are recognized as current profits and losses. Exchange gains or losses
which are related to available-for-sale financial assets are recognized as other comprehensive income.
D.

Financial assets

(1) Classification and measurement


The financial assets of the Group include financial assets measured at fair value through profit or loss, availablefor-sale financial assets, loans and receivables and held-to-maturity investments. Transactions of these financial
assets are confirmed on the transaction date.
In initial recognition, financial assets are measured at fair value. The transaction expenses of all these assets,
except financial assets measured at fair value through profit or loss, are added to initial cost as assets. The
transaction expenses of financial assets measured at fair value through profit or loss are recognized as current
profit or loss. In subsequent measurements, available-for-sale financial assets and financial assets measured at
fair value through profit or loss are measured at fair value, while loans and receivables and held-to-maturity
financial assets are measured at amortized cost (calculated by effective interest method).
The changes in the fair value of financial assets which are measured at fair value through profit or loss are
accounted into current profits and losses. The changes in the fair value of available-for-sale financial assets are
accounted into other comprehensive income, but the disposal and impairment losses related to this will be reclassified into current profits and losses when they are confirmed.
(2) Impairment loss
As of the end of the reporting period, we assess if there is any evidence in financial assets or assets groups
demonstrating that impairment losses have occurred. If there is any objective evidence showing that an
impairment loss has occurred and the loss can be reasonably estimated, we affirm this impairment loss on the
basis of its impact on future cash flows of financial assets.

32

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.

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30% 6
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.
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40

5~10

33

The impairment losses of loans and receivables are measured at bad debt reserve accounts, while other financial
assets are written down at the book value. When the amount cannot be recovered from financial assets, the
recognition of this asset should be terminated.
The objective evidence showing the impairment of the financial asset include the conditions listed below: issuers
of financial assets or debtors liable to pay the obligations have significant financial difficulties; interests or
principal payments are 3 months or more overdue; active markets of related financial assets disappear as a
result of financial difficulties; the fair value of available-for-sale financial assets is less than 30% of its original
value or has been declining for more than 6 months.
(3) Derecognition
Corporations cannot derecognize a financial asset if the corporation still retains the right of recourse (generated
from debtors who do not fulfill their obligations) or other risks and returns related to it. We should continue
recognizing the transfer element, and the acquired consideration should be recognized as financial liabilities.
A.

Financial derivative instruments

Financial derivative instruments are initially measured at fair value when signing the agreement, and
subsequently measured at fair value. When financial derivative instruments do not meet the conditions of risk
avoidance, their changes in fair value should be accounted into consolidated income statements as other
income/expense and profits/loss from financial assets according to the nature of the transaction.
B.

Fixed assets (tangible assets)

Fixed assets (tangible assets) are listed on the balance of their original book value subtracting accumulated
depreciation and accumulated impairment losses. Historical cost is the amount of direct expenditure on the
acquisition of assets. All assets except land subtract the residual value at the acquisition cost, and will be
amortized through effective interest methods in subsequent measurements. The depreciation method, residual
value and remaining useful life of fixed assets (tangible assets) need to be evaluated at the end of each fiscal
year. When necessary, we will conduct changes in accounting estimates.
Division

Estimated Useful Lives

Building

40 years

Machinery

5-10 years

Fixtures

5 years

Improvement in property of leased fixed assets

2 years

The depreciation method, residual value and the service life of tangible assets are re-evaluted at the end of each fiscal year.
Changes in estimate will be adopted if necessary.

34

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.
.

2. (1) ,
.
,
.

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,

.
35

C.

Borrowing costs

The borrowing costs resulting from acquiring or constructing assets should be capitalized. These assets accord
with the conditions of capitalization and are in the preparation stage (before they can be used).
The investment income should be deducted from capital cost before the use of special borrowing costs (incurred
for obtaining or building the qualified assets). Other borrowing costs are recognized as expenses in the current
period.
D.

Government subsidies

Government subsidies are recognized at fair value when subsidies have been received and related conditions
have been reasonably confirmed. The subsidies related to assets are deducted in calculating the book value of
the assets. The subsidies related to income are deferred, and the costs associated with the delivery of the
government subsidies should be deducted from subsidies.
E.

Intangible assets

Notes of goodwill: measured in the manner described in note (1) and presented by the balance of the original
price subtracting the accumulated impairment losses. Intangible assets (except goodwill) are measured at
historical cost in initial recognition. In subsequent measurements, intangible assets (except goodwill) are
represented by the balance of the original price subtracting the accumulated amortization and accumulated
impairment losses.

Individual acquisition
The original value of individually acquired intangible assets is the purchase price (include purchase discounts and
rebates, low-tax goods whose import duties cannot be refunded) and the expenditures incurred for making
assets ready to use.

Unfinished programs and complete programs


The production costs during the advertisement production period are accounted for under the account of
unfinished divisions, while the finished programs are recognized as intangible assets at the moment of
completion.
Internally researched and developed software is recognized as an intangible asset. The capitalized amount of the
development expenditures are the sum of the amount incurred after the technical feasibility of completing the
intangible asset and satisfying the recognition criteria of the asset. Rights to use facilities (membership fees)
could not be amortized due to unpredictability of time limits.
The following intangible assets with a finite useful life are amortized on a straight-line basis.
Division

Estimated Useful Life

Software

5 years

As for complete programs, amortization is accounted into sales expenses in accordance with a certain ratio. The
ratio is the percentage of current income of expected total income from the completion of software in the future.

36

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(2) 1018 ''

37

F.

Non-financial Asset Impairment Losses

Goodwill and intangible assets with indefinite useful lives should be conducted with the impairment test at the
end of each financial year. The impairment loss is the recoverable amount (the higher of the use value and the
fair value less disposal expenses) less than book value. All non-financial asset impairment losses except goodwill
are tested the possibility of its reversal at the end of each report period.
G.

Financial liabilities

(1) Classification and measurement


Financial liabilities designated as at fair value through profit or loss are financial instruments held for short-term
trading .Financial liability held for trading are those held for repurchasing in the short term. In addition, financial
derivatives are classified as financial liabilities held for trading, if they are held for the purpose of avoiding risks
or separate from embedded derivatives.
Financial liabilities at fair value through profit or loss, financial guarantee contracts, and financial liability incurred
during the transfer of financial assets, except for those that are not qualified for derecognition, are recognized as
non-derivative financial liabilities and measured at amortized cost. They should be listed as Accounts payable",
"Long-term financial liabilities" and "Other payables" etc. in the consolidated financial statement.
The preference shares that are obliged to be redeemed at a certain date are classified into liabilities.
The interest expenses recognized using the effective interest rate method, along with interest expenses from
other financial liabilities are recognized as Financial expenses on the consolidated income statement.
(2) Derecognition
Financial liabilities are derecognized in the consolidated financial statement when contractual obligations of
financial liabilities are performed, canceled, expired or the terms of an existing financial liability are changed
substantially.
H.

Financial guarantee contracts

Financial guarantee contracts provided by the Group are measured at fair value initially and are subsequently
measured at the higher of the two amounts between "short-term financial liabilities" and "Long-term financial
liabilities".
(1) The amount is recognized in accordance with the K-IFRS No. 1037 Provisions, Contingent Liabilities and
Contingent Assets.
(2) Initially the amount is recognized using the K-IFRS No. 1081 Revenue Recognition and deducting the
amount of accumulated amortization.

38

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.

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.
.
,
.
.
.
,
.
.

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.
.


.

.

,
.
.
(1)

.
,
.

39

I. Compound financial instruments


Compound financial instruments issued by the Group are the convertible bonds that can be converted into equity
by the holder.
The liability component of that compound financial instrument is initially recognized at fair value as a financial
liability with no conversion rights. The equity component is initially recognized as the difference between the fair
value of the liability component and the fair value of the whole compound financial instrument. Transaction
expenses directly related to the issue of the compound financial products are distributed in proportion to the fair
value of liability and equity components.
J.

Provisions

Provisions are measured at present value of the expenditures of perfuming the obligation. The increased amount
of the provision due to time value of money is recognized as interest expense.
K.

Current income tax and deferred income tax

Income tax expense consists of current income tax and deferred income tax. The amount of income tax related
to other comprehensive income or capital will be recognized directly in such related divisions, while others will be
accounted for current profits and losses. Income tax expenses are measured based on taxation laws at the end
of the each reporting period.
Deferred income tax results from temporary differences between the current amount and tax base of assets or
liabilities. As for transactions except the combination of businesses, there is no need to recognize deferred tax if
deferred income tax (generated from initial recognition of assets or liabilities) does not influence the current
profits or income taxes. Deferred income tax assets are recognized when it is probable that the temporary
difference which will result in further reduction in income taxes.
An entity shall recognize a deferred tax liability for all taxable temporary differences associated with investments
in subsidiaries, branches and associates and interests in joint ventures except to the extent that it is probable
that the temporary difference will not reverse in the foreseeable future. Whereas, the deductible temporary
differences shall be recognized as deferred income tax assets, except to the extent that it is probable that the
temporary difference will reverse in the foreseeable future.
The company has a legal enforceable right to set off the current (deferred) income tax assets against current
(deferred) income tax liabilities. Deferred tax assets and liabilities could be settled on a net basis if it is being
levied by the same taxation authority.
L.

Employee benefits

(1) Severance pay


Post-employment benefit plans are classified either as defined contribution plans or defined benefit plans. Under
defined contribution plans, an entity pays fixed contributions into a separate entity (a fund). Contributions to the
defined contribution plan shall be recognized when an employee has rendered service in exchange for those
contributions. All other post-employment benefit plans are defined benefit plans.

40

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.

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12

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41

Normally, the entity shall determine the amount of post-employment annuity under defined benefit plans based
on factors such as age, seniority and position. Liability Recognized in the consolidated financial statement
associated with the defined benefit plan is the difference between the present value of defined benefit obligation
and the accumulated fair value of any plan assets at the end of financial year. The liability is calculated by
independent actuaries every day, in the way of predicting unit accumulation. The present value of defined
benefit plan is the discounted value of the predicted future cash flow using the interest of a promising company
that has the same payment time and due date with the defined benefit plan. At the same time, the income
resulting from redefining the benefit plan is classified into other comprehensive income. As for revising the plan,
the reduction or settlement in the past service cost or the profit should be recognized in the profit and loss
account.
(2) Short-term employee benefits
Short-term employee benefits are employee benefits (other than termination benefits) that are due to be settled
within twelve months after the end of the period in which the employees render the related service. Short-term
employee benefit obligations are measured on an undiscounted basis.
M.

Paid-in capital

Common stocks are recognized as capital accounts, and the redeemable preferential shares are recognized as
liabilities.
When the Group acquires common stock from its subsidiary companies, the initial carrying amount of the
investment shall be the payment consideration(including the transaction cost)deducting the capital of the
Group, until those common stocks are cancelled or disposed of. When those stocks are disposed, the
consideration should be recognized as the capital of shareholders which belongs to the Group.
N.

Revenue recognition

Revenue is the gross inflow of economic benefits during the period arising in the course of the ordinary
activities of an entity. It includes revenue arising from the following transactions and events: the sale of goods;
the rendering of services; and the use by others of entity assets yielding interest, royalties and dividends.
Revenue can only be recognized when and only when the revenue of the consolidated company can be
measured reliably; it is probable that future economic benefits will flow into the company; the following
conditional features of parent company activities are satisfied. The judgement standards of the consolidated
company are based on historical data including the types of customers, the types of transactions, and the term
of individual transactions.
(1) Sales of goods
The revenue from sales of goods should be recognized when the products are transferred to the customers.
Products are transferred to the customer only when the products have arrived at the targeted places, the risk of
discard loss has been transferred to the customer, and the buyers claim the products according to the purchases
and sales contract, the confirmation period expires or the consolidated company satisfies the objective
conditions of claiming those products.
(2) Rendering of services
When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue
associated with the transaction shall be recognized, When the outcome of the transaction involving the
rendering of services cannot be estimated reliably, revenue shall be recognized only to the extent of the
expenses recognized that are recoverable.

42

(3)
.
,
.
.

.
2015 3 16
.
3.
. ,
.
.
.
.

( 11 ).
.

( 23 ).
.
.

( 4 ).
.
,
( 19 ).

43

(3) Interest income


The interest income should be recognized using the effective interest method. When the bond suffers
impairment losses, the amortized amount of it should be adjusted to the recoverable amount. Increased value
over time should be confirm the interest income. Interest income of the bond which suffers impairment loss is
recognized using the original effective interest rate.
O.

The approval of the consolidated financial statements.

In order to publish the consolidated financial statements at the regular shareholder meeting, the financial
statement shall be confirmed by the Board of Directors on 16 March 2015.
3.

Important accounting estimates and assumptions

The consolidated company conducts estimates and assumptions concerning the future. Estimates and
assumptions are proposed based on continually reviewing and considering the past experiences and forecasting
future events reasonably. The accounting estimate may be different from the actual result. Estimates and
assumptions that may affect the adjustment of the amortized cost of assets and liabilities in next financial year
are as follows:
A.

Impairment loss of goodwill

When the impairment loss is being reviewed, the recoverable amount of the cash-generating unit is calculated
on the basis of value-in-use (See Note 11 for reference).
B.

Income tax

Since the tax on the taxable income of the Group is influenced by applicable tax law and the decisions of tax
authorities, there is uncertainty of the final tax effect (See Note 23 for reference).
C.

The fair value of financial instruments

The fair value of financial instruments that are not traded in an active market is recognized by using the
valuation method in principle. As of the end of the reporting period, the consolidated company using a variety of
valuation methods and assumptions based on currently critical market conditions to verify the amount. (see Note
4).
D.

The net defined benefit liability

The present value of net defined benefit liability is determined by actuarial methods. It is affected by many
factors, especially the fluctuations in the discount rate (See Note 19 for reference).

44

4.
.
(, ),
.

.
,
.
(1)

,
. USD .

.
( : USD, ).

USD

USD

283,248

298,912

490,008

517,105

73,288

80,558


USD

1,053.22

1,099.20

1095.04

1055.30

.
10%
( : ).

USD

10%
(8,056)

10%
8,056

10%
(81,602)

10%
81,602

45

4.

Financial Risk Management

A.

Financial risk management elements

The Group is faced with market risks (price risk, cash flow, fair value and interest rate risk), credit risk, liquidity
risk and other financial risk. The overall risk management policies of the Group are focused on the
unpredictability of financial markets and minimizing the effects that can be potentially detrimental to the
financial performance.
Risk management is about some activities including formulation of risk management policies, recognition and
evaluation of financial risk, hedging and so on, which is approved by the Board of Directors.
(1) Market risk
Foreign exchange risk
Purchase, sales and liability presented in the currency that is not functional currency (KRW) of the Group are
exposed to the foreign exchange risk. US dollars are mainly used to present these transactions. Managers are
supposed to formulate management policies which are aimed at coping with foreign exchange risk of each
functional currency.
Foreign exchange risks of the Group are as follows: (Unit: USD, KRW 000)
End of Current Accounting Period End of Previous Accounting Period
Division

USD

KRW

USD

KRW

Accounts payable

283,248

298,912

Accrued expenses

490,008

517,105

73,288

80,558

Financial guarantee liabilities

Exchange rates of current and previous periods are as follows


Current Accounting Period
Division

Average Exchange Rate

USD

Previous Accounting Period

Ending Currency

1,053.22

Average Exchange Rate

1,099.20

Ending Currency

1095.04

1055.30

The Group regularly measures the risk of exchange rate fluctuate. As of the end of the reporting period, the
influence on current profit and loss are as follows when the rate of change (foreign currency to KRW) reaches up
to 10%. (Unit: KRW 000)
Current Accounting Period
Division
USD

10% Increase
(8,056)

Previous Accounting Period

10% Drop

10% Increase
8,056

(81,602)

10% Drop
81,602

46



.

.
.

. 30%
( : ).

30%

30%

30%

30%

30%

150,001

30%

30%

(150,001)

150,001

30%
(150,001)


.

.

( : ).

1,000,000

1,000,000

237,476,292

191,417,073

238,476,292

192,417,073

37,250,000

72,275,000

37,250,000

72,275,000


. 0.5%
( : ).

0.5%
186,250

0.5%
(186,250)

0.5%
361,375

0.5%
(361,375)

47

Price risk
The Group faces risk that results from changes of stock prices. These stocks are from associates, and are
recognized in the consolidated financial statement as available-for-sale financial assets. Investment on these
stocks may result in price risk; therefore, portfolios that are determined by the Group should be adopted in order
to diversify the risk.
The shares held by the Group that not traded in the open market are all recognized as non-listed shares
The rise and fall on stock prices would influence profit after tax and equity, the influences are as follows. Here
we analyze the influence when the unlisted stock price increases or decreases by 30%. (Unit: KRW 000)
Impact on Net Profit
Current Period
Division

30%
Increase

Unlisted shares

Previous Period
30%
Increase

30% Drop
-

Impact on Equity

Current Period
30%
Increase

30% Drop
-

30% Drop

150,001

(150,001)

Previous Period
30%
increase

30% drop

150,001

(150,001)

Interest rate risk


The interest rate risk of cash flows is a result of borrowing. Debts issued with floating interest rates will expose
the Group to interest rate risk. In the meantime, a part of risk generated from floating interest rates could be
offset by cash and cash equivalents measured at floating interest rates.
As of the end of the reporting period, the book values of financial instruments (interest needed to be paid) of
the Group are as follows: (Unit: KRW 000)
Division

Current Accounting Period

Previous Accounting Period

Fixed interest rate:


Loans and other receivables

1,000,000

1,000,000

Financial liabilities

237,476,292

191,417,073

Total

238,476,292

192,417,073

Financial liabilities

37,250,000

72,275,000

Total

37,250,000

72,275,000

Interest rate fluctuations:

The Group is exposed to interest rate risk because it finances through some floating rate debts. When the
interest rate of The current accounting period and the previous accounting period changes by 0.5%, the
influences on profit or loss are as follows: (Unit: KRW 000)
Current Accounting Period
Division
Interest expense

0.5% Increase
186,250

0.5% Drop
(186,250)

Previous Accounting Period


0.5% Increase
361,375

0.5% Drop
(361,375)

48

. ,
, .
.
.
.
(2)

.
,
.
.
.
( : ).

956,345

1,650,342

433,884

4,349,545

500,002

500,002

15,887,096

16,254,129

17,777,327

22,754,018


( : ).

5,124,483

5,080,002

11,196,497

15,523,672

16,320,980

20,603,674


( : ).

6
6 ~1
1

645,108

(33,481)

8,693,266

(19,049)

1,764,895

(22,316)

332,649

(46,152)

15,547,207

(1,580,433)

12,682,912

(1,039,951)

17,957,210

(1,636,230)

21,708,827

(1,105,152)
49

The Group has conducted a comprehensive analysis of the exposure to the interest rates. Convertibility issues,
renewal of existing debts, general financing, and risk avoidance are brought into the analytical framework. The
company would define interest rate fluctuations according to the analytical framework and measure its influence
on profit and loss. The changes on interest rates would be applicable to different kinds of currencies when facing
different situations. It mainly reflects the influence on liabilities with interest.
(2) Credit risk
Credit risk is the risk that one party to a financial instrument will cause a loss to the other party by failing to pay
for its obligation. Cash and cash equivalents, derivatives and deposits might have credit risks, apart from
accounts receivable and confirmed contracts. The Group saves the majority of deposits in Woori Bank and
similar renowned commercial banks; therefore, the credit risk is limited.
The book value of financial assets represents its maximum credit risk. As of the end of the reporting period, the
maximum credit risks of various divisions of financial assets are as follows: (Unit: KRW 000)
Division

Current Accounting Period

Previous Accounting Period

Cash and cash equivalents

956,345

1,650,342

Accounts receivable

433,884

4,349,545

Available-for-sale financial assets

500,002

500,002

Loans and other receivables

15,887,096

16,254,129

Total

17,777,327

22,754,018

As of the end of the reporting period, the maximum credit risk of some debts such as outstanding creditors
rights and borrowing is as follows. They are presented based on types of transactions. (Unit: KRW 000)
Division

Current Accounting Period

Related special parties

Previous Accounting Period

5,124,483

5,080,002

Other accounts

11,196,497

15,523,672

Total

16,320,980

20,603,674

From the end of the reporting period till now, the year to maturity of accounts receivable, loans and other
receivables and their damaged amount categorized by the years to maturity are as follows: (Unit: KRW 000)
Current Accounting Period
Division

Balances Receivable

Previous Accounting Period

Impairment Loss

Balances Receivable

Impairment Loss

Less than 6 months

645,108

(33,481)

8,693,266

(19,049)

6 months to 1 year

1,764,895

(22,316)

332,649

(46,152)

Over 1 year

15,547,207

(1,580,433)

12,682,912

(1,039,951)

Total

17,957,210

(1,636,230)

21,708,827

(1,105,152)
50

(3)

.
,
.
,
.
(: ) .
( : ).
()

6~12

1~2

2~5

130,589,865

78,052,120

208,641,985

80,558

80,558

130,670,423

78,052,120

208,722,543

426,000

426,000

61,214,476

62,066,476

76,523

76,523

7,109,276

7,109,276

138,282,222

78,478,120

61,214,476

277,974,818

()

6~12

1~2

2~5

140,481,931

55,996,760

196,478,691

33,900

1,526,284

1,560,184

140,515,831

57,523,044

198,038,875

426,000

426,000

852,000

61,214,476

62,918,476

2,138,005

2,138,005

8,505,618

21,707

78,261

8,605,586

151,585,454

57,970,751

930,261

61,214,476

271,700,942

,
.

51

(3) Liquidity risk


Liquidity risk is the risk that an entity will have difficulties in paying its financial liabilities. The methods coping
with liquidity risk include: management of expected losses on failing to repay the debts or maintaining sufficient
liquidity before the debt expires.
The Group controls the cash flow through middle or long term business plans and short-term operational
strategies, and holds enough cash to maintain ordinary operations. Potential influences that are from
unpredictable situations are not included.
As of the end of the reporting period, the maturity conditions of financial liabilities are as follows (Unit: KRW 000)
(The end of the current accounting period)
Division

Less than 6
Months

6-12 Months

1-2 Years

2-5 Years

Total

Short-term financial liabilities


Short-term borrowing
Financial guarantee liabilities
Subtotal

130,589,865

78,052,120

208,641,985

80,558

80,558

130,670,423

78,052,120

208,722,543

426,000

426,000

61,214,476

62,066,476

76,523

76,523

7,109,276

7,109,276

138,282,222

78,478,120

61,214,476

277,974,818

Long-term financial liabilities


Redeemable, convertible,
preference shares and convertible
Accounts payable
Other liability payments
Total

(The end of the previous period)


Division

Less than 6
Months

6-12 Months

1-2 Years

2-5 Years

Total

Short-term financial liabilities


Short-term borrowing

140,481,931

55,996,760

- 196,478,691

33,900

1,526,284

140,515,831

57,523,044

- 198,038,875

426,000

426,000

852,000

61,214,476

62,918,476

Accounts payable

2,138,005

2,138,005

Other liability payments

8,505,618

21,707

78,261

8,605,586

151,585,454

57,970,751

930,261

Long-term current liabilities


Subtotal

1,560,184

Long-term financial liabilities


Redeemable, convertible,
preferential shares and convertible

Total

61,214,476 271,700,942

The cash flow amount generated in previous periods of the Group is presented consistently.

52


,
.
( : ).

315,119,477

302,224,152

956,345

1,650,342

314,163,132

300,573,810

45,441,471

36,729,754

691%

818%

.
.
.
- ( ) ( 1)
- (: ) (: ) ,
. 1 ( 2)
- , (
) ( 3)
(1) ( :
).

22,876,044

24,820,012


. , , , ,
,
, .
. 1 . 1

KOSPI , KOSDAQ
.
53

B.

Capital risk management

The Group conducts capital risk management to optimize capital structure and maintain healthy capital structure,
even maximize the shareholders benefits. Therefore, the Group carries out improvements, such as adjustments
to the debt ratio, the net borrowing ratio, similar ratios and so on.
As of the end of the reporting period, the Groups debt ratios are as follows: (Unit: KRW 000)
Division

Current Accounting Period

Total liabilities

315,119,477

302,224,152

956,345

1,650,342

314,163,132

300,573,810

45,441,471

36,729,754

691%

818%

Less: cash and cash equivalents


Adjusted liabilities
Total equity
Adjusted liability-to-equity ratio
C.

Previous Accounting Period

The measurement of fair value

The criteria relating to the fair value is listed as below. Using the following valuation method to determine the
value of the financial instrument.

Level 1 quoted prices for similar assets or liabilities


Level 2 directly observable market inputs other than Level 1 inputs
Level 3 inputs not based on observable market data

(1) As of the end of the reporting period, financial assets and financial liabilities measured at fair value are as
follows: (Unit: KRW 000)
Current Accounting Period
Division

Level 1

Level 2

Previous Accounting Period

Level 3

Level 1

Level 2

Level 3

Financial liabilities:
Financial liabilities at fair value through profit or loss
Derivatives

22,876,044

24,820,012

The fair value of financial instruments traded in active markets is determined by the market price reported at
the end of the reporting period. Active markets are those where regular transactions happened among
independent commercial entities. The prices of those transactions are reported to the public. Those
transactions can be carried out through transaction places, sellers, agencies, industry groups, assessment
agents, supervisory organizations and so on. The reported market price of financial assets that belong to the
Group is the purchasing price. This type of commodity is included in level 1. Instruments that are included in
level 1 are mainly listed shares of trading financial instruments and available-for-sale financial instruments,
and these shares are listed in KOSPI or KOSDAQ.

54

(: )
.
. ,
2 .

3 .
.
-
-
-

-
, ,
.
( : %).

2.10

2.65

(2) ( : )

500,000

500,000

(*2)

Celltrion Healthcare India Privated


Limited(*1)

500,002

500,002

500,002

500,002

(*1)

()(*2)

(*1)
.
(*2) 543,708 , 1,456,292
.

55

The fair value of the financial instruments which are not traded in active markets, such as the over-thecounter financial derivatives, is determined by an evaluation method. The evaluation method makes the
maximum use of observable market information and the minimum use of the company-specific information.
The measurement of the fair value of the corresponding instruments requires all the input variables included
in level 2.
If more than one input variable is not based on the market information, then the corresponding instruments
should be included in level 3.
The evaluation method of measuring the fair value of the financial instruments is as follows.

The public market price or dealer price of similar instruments

The fair value of interest rate swap is calculated by the present value of the cash flow which is estimated
from the observable yield curve.

The fair value of the forward exchange is calculated by the present value discounted by the current
reference exchange as of the end of the reporting period.

The fair value of other financial instruments is measured at the discounted cash flow method and other
methods.
Moreover, to measure the fair value of the above-mentioned financial instruments, the interest rate used for
discounting expected cash flows is equal to the sum of the yield rate of the national debt (as of the end of
the reporting period) and the risk premium. The current and previous interest rates adopted by the Group are
as follows. (Unit: %)
Division

Current Period

Previous Period

Derivatives
2.10
2.65
As of the end of the reporting period, current available-for-sale financial assets determined by historical costs are
as follows. (Unit: KRW 000)
Category of financial
products

Division

Current Period

Previous Period

Available-for-sale financial assets


Yonhap TV News (*1)

Equity securities

500,000

500,000

Secure-net(*2)

Celltrion Healthcare India


Limited(*1)

500,002

500,002

Picosnet (*2)

Total

500,002

500,002

Total
Convertible bonds and
warrants bonds
Total

(*1) The equity investment which is not listed for transactions is measured at the acquisition cost, as no
active markets are available and the fair value cannot be estimated reliably.
(*2) The possibility of reversing the impairment loss of net assets is low. The impairment losses in the
previous accounting period and before the previous accounting period are respectively 543,708,000 KRW and
1,456,292,000 KRW.

56

.
5.
( : ).

2,559

483,221

1,647,761

CMA

473,124

22

956,345

1,650,342

6.

.
( : ).

477,884

(44,000)

433,884

4,393,545

(44,000)

4,349,545

16,447,524

(1,592,230)

14,855,294

16,180,903

(1,061,154)

15,119,749

(*)

1,000,000

1,000,000

1,000,000

1,000,000

11,997,891

(661,983)

11,335,908

12,597,129

(298,504)

12,298,625

516,297

(476,392)

39,905

556,772

(459,570)

97,202

2,933,336

(453,855)

2,479,481

2,027,002

(303,080)

1,723,922

16,925,408

(1,636,230)

15,289,178

20,574,448

(1,105,154)

19,469,294

(*) 3
(
31 ).
. ( : ).

1,105,154

1,270,153

1,605,233

310,280

(1,074,157)

(475,279)

1,636,230

1,105,154

57

5. Cash and cash equivalents


As of the end of the reporting period, the cash and cash equivalents of the Group are as follows (Unit: KRW 000)
Division

Current Period

Previous Period

Cash on hand

2,559

Ordinary deposits

483,221

1,647,761

CMA

473,124

22

Total

956,345

1,650,342

6.
A.

Issued bonds, loans and others liabilities


As of the end of the reporting period, the issued bonds and loans and others liabilities of the consolidated
company are as follows (Unit: KRW 000)
Current Accounting Period
Division
Book Value

Trades
receivable
Loans and other
receivables
Term deposits
(*)
Short-term loans

Total

Net Carrying
Amount

Book Value

Bad Debt
Reserves

Net Carrying
Amount

477,884

(44,000)

433,884

4,393,545

(44,000)

4,349,545

16,447,524

(1,592,230)

14,855,294

16,180,903

(1,061,154)

15,119,749

1,000,000

1,000,000

1,000,000

1,000,000

11,997,891

(661,983)

11,335,908

12,597,129

(298,504)

12,298,625

516,297

(476,392)

39,905

556,772

(459,570)

97,202

2,933,336

(453,855)

2,479,481

2,027,002

(303,080)

1,723,922

16,925,408

(1,636,230)

15,289,178

20,574,448

(1,105,154)

19,469,294

Account
receivable
Accrued income

Bad Debt
Reserves

Previous Accounting Period

(*) As of the end of the accounting period, the above-mentioned fixed deposits were provided as collateral for
third party borrowing. (See Note 31 for reference)
B.

Changes in allowance for bad debts of the Group in the current and previous accounting periods are as
follows: (Unit: KRW 000)
Division

Current Accounting Period

Previous Accounting Period

Opening balance

1,105,154

1,270,153

Set amount

1,605,233

310,280

(1,074,157)

(475,279)

1,636,230

1,105,154

Changes of consolidation
Balance figure

58

7.
( : ).

51,965

485,474

323,177

977,930

6,801

25,897

1,052,584

100,000

100,000

507,840

2,615,988

8.

. ( : ).

(*1),(*2)

500,002

500,002

500,002

500,002

(*2)

(*1)
,
543,708 1,456,292 .
(*2)
1,110,000 .
. ( : ).

500,002

13,990,652

(13,490,652)

500,002

500,002

9.
. ( : ).

()

(%)
20.07

(*)
21,825,630

(%)

321,533,137

20.08

292,924,582

(*) () .
59

7. Other current assets


As of the end of the reporting period, other current assets of the Group are as follows (Unit: KRW 000)
Division

Current Accounting Period

Advance payments

Previous Accounting Period


51,965

485,474

323,177

977,930

6,801

25,897

1,052,584

Other

100,000

100,000

Total

507,840

2,615,988

Prepaid expenses
Value added tax payment
Current tax assets

8.

Available-for-sale financial assets

A.

As of the end of the reporting period, the available-for-sale financial assets of the Group are as follows (Unit:
KRW 000)
Division

Current Accounting Period

Non-marketable equity securities (*1),(*2)

Previous Accounting Period

500,002

500,002

500,002

500,002

Convertible bonds and warrants bonds (*2)


Total

(*1) The equity investment which is not listed for transactions is measured at the acquisition cost, as no active
markets are available and the fair value cannot be estimated reliably. The possibility of reversing the
impairment loss of net assets is less, so the impairment losses in the previous accounting period and before
the previous accounting period are respectively 543,708,000 KRW and 1,456,292,000 KRW.
(*2) As of End of Previous Accounting Period, the impairment losses of convertible bonds of which possibility of
reversing net assets value is low, which is KRW 1.11 BN.
B.

The changes in the available-for-sale financial assets of the Group in current and previous periods are as
follows: (Unit: KRW 000)
Division

Current Accounting Period

Previous Accounting Period

Opening balance

500,002

13,990,652

Acquisition price

Disposal amount

(13,490,652)

500,002

500,002

Balance
9.

Investment

A.

As of the end of the reporting period, the Groups investment on its subsidiaries are as follows:
(Unit: KRW 000)
Current Accounting Period
Company
name
Share Holdings (%) Number of Shares (*)

Celltrion

20.07

21,825,630

Previous Accounting Period


Book Value

Share Holdings (%)

321,533,137

20.08

Book Value
292,924,582

(*)Celltrions number of shares is the number after considering allotment of the shares.
60

.
. ( : )

292,924,582

359,058,615

21,712,613

24,591,390

6,895,942

(10,545,740)

(80,179,683)

321,533,137

292,924,582

(*1)
(*2)

(*1) .
(*2) .
. ( : ).
()

()

2,322,385,039

974,603,694

471,045,511

117,481,628

()

()

1,978,508,192

891,376,234

226,207,869

102,454,821

. ( : ).

()

847,925,726

321,533,137

797,155,206

292,924,582

10.
.
873,587 ( :
839,987 ).
.
( : )

61

B.

The investments of the Groups subsidiaries in the current and previous periods are as follows:
(Unit: KRW 000)
Division

Current Accounting Period

Opening balance

Previous Accounting Period

292,924,582

359,058,615

21,712,613

24,591,390

6,895,942

(10,545,740)

Disposal

(80,179,683)

Balance

321,533,137

292,924,582

Share of profit or loss (*1)


Other changes (*2)

(*1) The profits and losses of subsidiaries include the profits and losses of the change of shares
and the disposal of related stock investments.
(*2) The other comprehensive income of subsidiaries, the change in the mandatory reserves and
other capital reserves are included.
C.

As of the end of the reporting period, the liabilities of the subsidiaries are as follows (Unit: KRW 000)

(As of the end of the current period)


Company Name
Celltrion

Total Assets

Total Liabilities

2,322,385,039

Revenue

974,603,694

Net Income

471,045,511

117,481,628

(As of the end of the previous period)

Company Name
Celltrion
D.

Total Assets

Total Liabilities

1,978,508,192

Revenue

891,376,234

Net Income

226,207,869

102,454,821

The market value of the investment of the subsidiaries in the current and previous periods are as follows
(Unit: KRW 000)
Current Accounting Period
Division

Celltrion

Market Price
847,925,726

Book Value
321,533,137

Previous Accounting Period


Market Price
797,155,206

Book Value
292,924,582

10. Fixed assets


A. The quoted price of the holding lands.
As of the end of the reporting period, the quoted value of the lands held by the Group is KRW 873,587,000
(Previous period: KRW 839,987,000)
B. The changes in the tangible assets
The changes in the tangible assets of the Group in the current and previous periods are as follows (Unit: KRW
000)

62

()

(*)

220,201

1,469,013

142,485

160,672

10,351,616

13,402,075

8,857

126,392

712,958

848,207

(26,150)

(85,599)

(199,814)

(311,563)

1,058,088

220,201

1,442,863

65,743

87,250

11,064,574

13,938,719

(16,515)

(494,144)

(31,106)

(10,906)

(552,671)

1,058,088

203,686

948,719

34,637

76,344

11,064,574

13,386,048

5,505

172,405

13,844

39,624

231,378

1,058,088

(*)
712,958 ( : 351,616 ), .
6.89%( : 6.9%).
()

(*)

1,058,088

220,201

1,442,863

89,639

160,672

26,150

49,032

75,182

4,069

10,351,616

10,355,685

2,971,463

(255)

(255)

1,058,088

220,201

1,469,013

142,485

160,672

10,351,616

13,402,075

(11,010)

(337,429)

(52,653)

(160,672)

(561,764)

1,058,088

209,191

1,131,584

89,832

10,351,616

12,840,311

5,505

172,406

18,194

80,336

276,441

( :
).

1,470,255

63

(The current period)

Division

Land

Building

Beginning
balance of
1,058,088
acquisition cost

Property
Assets under
Improvement to Construction
Leased Fixed Assets
(*)

Machinery Fixtures

Total

220,201

1,469,013

142,485

160,672

8,857

126,392

712,958

848,207

(26,150) (85,599)

(199,814)

(311,563)

Acquisition /
capital

Disposal

The final
1,058,088
acquisition cost

220,201

1,442,863

65,743

87,250

Ending
accumulated
depreciation

(16,515)

(494,144) (31,106)

(10,906)

Ending book
value

1,058,088

203,686

948,719

34,637

76,344

Depreciation

5,505

172,405

13,844

39,624

10,351,616 13,402,075

11,064,574 13,938,719

(552,671)

11,064,574 13,386,048
-

231,378

(*) The borrowing expenditure during the process of the acquisition of the Groups fixed assets is 712,958,000
KRW in The current accounting period (previous period: KRW 351,616,000), and will be capitalized within the
applicable time limit. The interest rate when calculating the capitalized amount is 6.89% (previous period: 6.9%)
(Previous period)
Division
Based on
acquisition cost

Land

Building

Machinery

Fixtures

Property
Assets under
Improvement
Construction
to Leased Fixed
(*)
Assets

Total

1,058,088

220,201

1,442,863

89,639

160,672

2,971,463

Changes of
consolidation

26,150

49,032

75,182

Acquisition /
capital

4,069

Disposal

(255)

1,058,088

220,201

1,469,013

142,485

160,672

(11,010)

(337,429)

(52,653)

(160,672)

1,058,088

209,191

1,131,584

89,832

5,505

172,406

18,194

80,336

The final cost


Ending
accumulated
depreciation
Ending carrying
amount
Depreciation

10,351,616 10,355,685
-

(255)

10,351,616 13,402,075
-

(561,764)

10,351,616 12,840,311
-

276,441

C. Insurance assets
As of the end of the current period, the insurance value for the fixed assets of the Group is as
follows (Unit: KRW 000)
Insurance Type
Fire insurance

Insured Property
Buildings and machinery

Insurance Companies
Hanwha General
Insurance

Amount
1,470,255

64

11.

( : ).
()

(*1)

868,700

868,700

14,681

(3,558)

11,123

100,000

212,489

1,364,126

(1,221,056)

455,559

1,111,448

9,456,609

(1,364,126)

(9,203,931)

29,512

31,500

(19,012)

42,000

2,124,341

9,700,598

(19,012)

(10,428,545)

1,377,382

.
()

(*2)
(*1)

1,276,275

(1,276,275)

868,700

868,700

6,572

19,012

10,000

(1,891)

33,693

100,000

100,000

1,211,448

(100,000)

1,111,448

10,500

10,500

875,272

1,295,287

1,231,948

(1,278,166)

2,124,341

(*1)
.
(*2) () ,
. , ,
() .

65

11. Intangible assets


The changes in the Groups intangible assets in the current and previous periods are as follows: (of the
current period, the insurance value for the fixed assets of the company is as follows (Unit: KRW 000)
Current period
Division

Beginning

Facility usage
tickets(*1)

Acquisition

Replaced

Sales Expense / Cost

Ending

868,700

868,700

14,681

(3,558)

11,123

Completed programs

100,000

212,489

1,364,126

(1,221,056)

455,559

Unfinished programs

1,111,448

9,456,609

(1,364,126)

(9,203,931)

29,512

31,500

(19,012)

42,000

2,124,341

9,700,598

(19,012)

(10,428,545)

1,377,382

Software

Other intangible assets


Total

(Previous period)

Division

Consolidation
Changes

Beginning

Acquisitions

Sales Expense
/ Cost

Replaced

Ending

Goodwill (*2)

1,276,275

(1,276,275)

Facility usage
tickets(*1)

868,700

868,700

6,572

19,012

10,000

(1,891)

33,693

Completed
programs

100,000

100,000

Unfinished
programs

1,211,448

(100,000)

1,111,448

Other intangible
assets

10,500

10,500

875,272

1,295,287

1,231,948

(1,278,166)

2,124,341

Software

Total

(*1) Conducting an impairment test to the unlimited golf membership, no impairment loss will be confirmed
in the current or previous periods.
(*2) The Group gained control of Celltrion in the previous period, therefore the Group recognized the goodwill.
Meanwhile, the Group conducted the impairment test on Celltrion and found out that Celltrion encroached on
its capital, so the Group recognized the impairment loss of the goodwill.

66

12.
( : ).

845,702

839,920

131,100

264,460

55,000

30,000

1,031,802

1,134,380

13.
(: ).

5,979,214

5,694,666

14.
( : ).
.

(*)

22,876,044

24,820,012

203,084,242

192,208,926

1,500,000

80,558

203,164,800

193,708,926

24,090,864

22,599,297

24,594,584

22,563,838

48,685,448

45,163,135

274,726,292

263,692,073

(*)
, () ( 31 ).
2015 3 13 .

67

12. Other long-term borrowing


As of the end of the current period, other long-term borrowings by the Group are as follows (Unit: KRW 000)
Division

Current Accounting Period

Previous Accounting Period

Long-term savings insurance

845,702

839,920

Deposits

131,100

264,460

55,000

30,000

1,031,802

1,134,380

Long-term receivables
Total

13. Other non-current assets


As of the end of the reporting period, details of other non-current assets of the Group are as follows:
(Unit: KRW 000).
Division

Current Accounting Period

Long-term prepaid expenses

Previous Accounting Period

5,979,214

5,694,666

14. Financial liabilities


As of the end of the reporting period, details of financial liabilities of the Group are as follows: (Unit: KRW 000).
A. Financial liabilities

Division

Current Accounting Period

Previous Accounting Period

Financial liabilities at fair value through profit or loss


Derivatives (*)

22,876,044

24,820,012

Short-term borrowing

203,084,242

192,208,926

Long - term liabilities

1,500,000

80,558

203,164,800

193,708,926

Convertible bonds

24,090,864

22,599,297

Redeemable convertible preference


shares

24,594,584

22,563,838

Subtotal

48,685,448

45,163,135

274,726,292

263,692,073

Short-term financial liabilities

Financial guarantee liabilities


Subtotal
Long-term financial liabilities

Total

(*)The option contract for indemnity and excess return on stock trading is measured at fair value. The
collateral for trading are the shares offered by Celltrion (see Note 31 for reference). This options agreement
has been terminated in 13 March 2015.
68

2014.12.31

(%)

5.3

10,000,000

10,000,000

NH

6.0

7,500,000

7,500,000

MOR+2.75

17,250,000

43,000,000

CD+2.64

20,000,000

25,000,000

KDB

5.5

30,000,000

35,000,000

2,775,000

5.2

7,000,000

5.2

20,000,000

5.1

5,000,000

LIG

4.9

5,000,000

5.2

5,000,000

NH

5.0

20,000,000

5.2

5,000,000

()

6.9

50,231,342

65,664,342

()

8.0

1,000,000

1,000,000

102,900

2,269,584

203,084,242

192,208,926

0~6.9

()
( 31 ).
.

2014.12.31
(%)

(*)

1,500,000

1,500,000

(1,500,000)

(*)
.

69

B.

Short-term borrowing
31 Dec 2014 Annual Interest Rate
(%)

Borrowing Sources

Monetary Amount
Current Accounting
Previous Accounting
Period
Period

Hyundai Securities

5.3

10,000,000

10,000,000

NH Capital

6.0

7,500,000

7,500,000

MOR+2.75

17,250,000

43,000,000

Korea Securities Finance

CD+2.64

20,000,000

25,000,000

KDB Daewoo Securities

5.5

30,000,000

35,000,000

2,775,000

Agricultural Bank

Hana Bank

Kyobo Securities

5.2

7,000,000

Korea Investment &


Securities

5.2

20,000,000

Samsung Securities

5.1

5,000,000

LIG Investment &


Securities

4.9

5,000,000

Hanwha Securities

5.2

5,000,000

NH Securities

5.0

20,000,000

Dongbu Securities

5.2

5,000,000

Celltrion GSC

6.9

50,231,342

65,664,342

HANSKIN

8.0

1,000,000

1,000,000

102,900

2,269,584

203,084,242

192,208,926

Etc.

0~6.9

Total

The debt above takes the shares of Celltrion as collateral (see Note 31 for reference).
C. Long-term borrowing

Borrowing Sources

31 Dec 2014 Annual


Interest Rate (%)

Agricultural Bank (*)

Amount of money
Current Accounting
Period

Previous Accounting
Period
-

1,500,000

Total

1,500,000

Less : Long - term liabilities

(1,500,000)

Balance

Repayment Method
-

(*)The borrowings above take fixed assets, such as land, as collateral. The collateral for current borrowings
that has been repaid has been terminated already.

70

(%)

2011.12.27

2016.12.27

9.0

21,300,000

21,300,000

6,262,341

6,262,341

(3,471,477)

(4,963,044)

24,090,864

22,599,297

.
: 4%, 3
: 9%
: 17,914 (
5,000 ) : 1
: 1,189,000
: 2015 1 1

: 2013 1 1

:
,

: ( 31 )
: 2012 1 1 2017 1 1
50%

.

(%)

2013.12.19

9.0

22,500,000

22,500,000

6,700,135

6,700,135

(4,605,551)

(6,636,297)

24,594,584

22,563,838

2 .

71

D.

Convertible bonds
Division

Date of
issue

Repayment
date

Guaranteed
return (%)

First issue without guarantee 2011.12.27 2016.12.27

9.0

Current
Previous Accounting
Accounting Period
Period
21,300,000

21,300,000

6,262,341

6,262,341

Less : conversion right adjustment

(3,471,477)

(4,963,044)

Balance

24,090,864

22,599,297

Add: reimbursement premiums

Details of the issue of convertible bonds above are as follows:


Interest rate and interest payment period: annual interest rate of 4%, 3 month exhibition period.
Repayment: If there is no conversion or early redemption, the bonds should be repaid at an annual interest
rate of 9% for one time.
Type and number of shares issued at the time of conversion: 17,914 named common stocks (5,000 KRW
par value)
Conversion time: One year after the issue date to the last trading day before the maturity
Conversion price: KRW 1,189,000.
Early repayment of principal claimed by the creditor: from 1 January 2015 to the date of maturity, it is
feasible to get early redemption according to the amount specified in the agreement on every interest
payment date.
Early repayment of principal of the Group: from 1 January 2013 to the date of maturity, it is feasible to get
early redemption according to the amount specified in the agreement on every interest payment date.
The initial dividends of the shares and interests came from conversion: it should be seen as a conversion
that happens at the end of the financial year. Interests should be calculated and paid by the days from the
interest payment date to the conversion request date.
Joint Guarantee: the Representative Director (see Note 31 for reference)
Other Commitments: From 1 January 2012 to 1 January 2017, the Representative Director and others have
the right to transfer their Celltrion shares to the bond-holders at the price of 50% of the par value of
convertible bonds.
E.

Preferential shares
Division
Second redeemable convertible
preferential shares

Date of
Issue

Guaranteed
Returns (%)

19 Dec
2013

9.0

Current Accounting Previous Accounting


Period
Period
22,500,000

22,500,000

6,700,135

6,700,135

Less : conversion rate adjustment

(4,605,551)

(6,636,297)

Balance

24,594,584

22,563,838

Add: reimbursement premiums

In the previous accounting period, the details of newly issued secondary convertible preferential shares are as
follows:

72

:
: 4%
: 9%
: 10,000 (
5,000 ) : 2014.1.19 ~ 2016.12.19
: 2,250,000
: 1 9%

.

1 1
9%

15.
( : ).

76,523

2,138,005

7,109,276

8,527,325

785,759

1,902,424

6,090,637

5,827,014

232,880

710,933

86,954

7,185,799

10,665,330

16.
( : ).

22,550

17.
( : ).

20,672

20,672

18,500

(20,672)

18,500

20,672

(20,672)

18,500

73

Category: cumulative participating redeemable, convertible, and preferential shares.


The minimum annual interest rate: 4% of issue price per share of the redeemable, convertible, and
preferential shares.
Redemption: If there is no early redemption or conversion, the shares should be repayed at the rate of
annual guaranteed return of 9% for one redemption.
The type and number of shares issued from conversion: 10,000 named common shares (KRW 5,000 par
value).
Conversion period: 19 Jan 2015 ~19 Dec 2016
Conversion price: KRW 2,250,000 per share.
Repayment price per share: the issue price per share and the amount of the compound interest calculated
at the annual rate of 9% from issue date to maturity date should be recognized as the dividend of
redeemable, convertible, preferential shares and the compound interest from the payment date of dividend
to the date of redemption.
When there is no distributable dividend, the reimbursement amount per share is the continuously calculated
reimbursement amount per share from the reimbursement date plus the compound interest calculated at the
annual rate of 9% to the date when the dividend can be distributed.
15. Accounts payable
As of the end of the reporting period, the details of accounts payable and other payables of the Group are as
follows. (Unit: KRW 000)
Division
Trades payable

Current Accounting Period

Previous Accounting Period

76,523

2,138,005

7,109,276

8,527,325

Accounts payable

785,759

1,902,424

Accrued expenses

6,090,637

5,827,014

232,880

710,933

86,954

7,185,799

10,665,330

Other debt payments

Deposit received
Value-added tax deposit received
Total

16. Other current liabilities


As of the end of the reporting period, the details of other current liabilities of the Group are as follows.
(Unit: KRW 000)
Division

Current Accounting Period

Unearned revenue

Previous Accounting Period


-

22,550

17. Contingencies
The details of contingencies of the Group in the current and previous accounting period are as follows.
(Unit: KRW 000)
Division

Current Accounting Period

Previous Accounting Period

Beginning

20,672

20,672

Increase

18,500

Decrease

(20,672)

18,500

20,672

(20,672)

18,500

Ending
Less: Liquidity provisions
Balance

74


.
18.
( : ).

78,261

19.
.
(1)
( : ).

109,828

276,778

109,828

276,778

(2) ( : ).

276,778

68,313

151,447

97,631

12,719

5,957

(45,933)

41,440

(47,802)

31,306

(27,848)

(155,630)

(27,116)

(53,903)

59,247

109,828

276,778

(3)
(2.83%) AAA 7

5 .
.
9.21 .

75

As of the end of the reporting period, interior redecoration fees spent on the leased building used by the
subsidiary are recognized as a rebuilding contingent liability.
18. Other long-term liability
As of the end of the reporting period, the details of other long-term liabilities of the Group are as follows:
(Unit: KRW 000)
Division

Current Accounting Period

Long-term payables

Previous Accounting Period


-

78,261

19. Retirement benefits


A. Defined benefit system
(1) As of the end of the current reporting period, the details of the obligations related to defined retirement
benefit plan of the Group are as follows: (Unit: KRW 000).
Current Accounting
Division
Previous Accounting Period
Period
PV of defined benefit obligation (which occured
from the system that are not accumulated with
funds)

109,828

276,778

Borrowings and debentures

109,828

276,778

(2) The details of changes in net defined benefit liabilities of the Group in the current and the previous
accounting period are as follows (Unit: KRW 000).
Division

Current Accounting Period

Previous Accounting Period

Opening balance

276,778

68,313

Current service cost

151,447

97,631

12,719

5,957

Past service cost and gain or loss


on settlements

(45,933)

41,440

Actuarial gains or losses

(47,802)

31,306

Variance adjustments

(27,848)

(155,630)

(27,116)

Changes in the scope of


consolidation

(53,903)

59,247

Balance

109,828

276,778

Interest expenses

Payments

(3) As of the end of the reporting period, the main estimates for the current actuarial valuation are as follows.
The discount rate (2.83%) for discounting the value of defined benefit plans are calculated by the yield rates
of the 7-year AAA corporate bonds and 5-year AAA corporate bonds. The discount rate reflects the expected
payment date. The average remaining years of employment (9.21 years) are used when calculating the
pensions according to the employees registered and their families
76

, .
18,397 ( : 34,600 ) ,
.
.

123,695 ).

146,657

20.
. ( : , ).

20,000,000

20,000,000

5,000

5,000

300,000

300,000

1,500,000,000

1,500,000,000

. ( : )

300,000

300,000

300,000

300,000

300,000

300,000

300,000

300,000

. ( :
).

37,978,131

37,978,131

()

1,001,132

1,001,132

()

1,677,564

1,677,564

(640,484)

(640,484)

2,038,212

2,038,212

40,016,343

40,016,343

. ( : ).

(11,349,644)

(16,728,503)

21.
.
77

.
Meanwhile, the net amount recognized is included in employee benefits in the consolidated comprehensive
income statements. As for the current recognized amount, KRW 18,397,000 (the previous period: KRW
34,600,000) is included in cost of sales, and the remaining amount is included in sales and administrative
expenses in the comprehensive income statement.
B.

Defined contribution plan

The current recognized expenses related to defined contribution plans is KRW 146,657,000 (the previous
period: KRW 123,695,000).
20. Capital
A.

As of the end of the reporting period, the capital details of the Group are as follows. (Unit: share, KRW).
Division

Current Accounting Period

Previous Accounting Period

Authorized shares

20,000,000

20,000,000

Amount per share

5,000

5,000

Circulating shares

300,000

300,000

1,500,000,000

1,500,000,000

Common stock
B.

The changes in the number of outstanding shares of the Group in the current and previous accounting
periods are as follows: (Unit: share)
Current Accounting Period
Circulating
Shares

Division

Previous Accounting Period

Treasury
Number of
Circulating
Stock
Circulating Shares
Shares

Treasury
Number of
Stock
Circulating Shares

Basic circulating
shares

300,000

300,000

300,000

300,000

Issued shares at the

300,000

300,000

300,000

300,000

C.

As of the end of the reporting period, the details of the capital surplus and other capital accounts of the
Group are as follows: (Unit: KRW 000)
Division

Current Accounting Period

Previous Accounting Period

Capital surplus
Stock premium

37,978,131

37,978,131

Conversion price (Convertible bonds)

1,001,132

1,001,132

Conversion price(Redeemable,
convertible, and preferential shares)

1,677,564

1,677,564

Capital adjustments

(640,484)

(640,484)

Subtotal

2,038,212

2,038,212

40,016,343

40,016,343

Other capital items

Total
D.

As of the end of the reporting period, the accumulated amount of other comprehensive income of the
Group is as follows: (Unit: KRW 000).
Division

Current Accounting Period

Previous Accounting Period

Equity of other comprehensive income


(11,349,644)
(16,728,503)
related to consolidated subsidiaries
21. Retained earnings
As of the end of the reporting period, the current year retained earnings refer to total amount of the
undistributed profits.
78

22.
.
( : ,
).
(1)

()

885,223,989

(50,507,860,299)

300,000

300,000

2,951

(168,360)

()

(2)

1 1 ~ 12 31

300,000

300,000

300,000

300,000

.
.
23.
.
( : ).

5,610,570

(4,707,381)

(1,517,114)

4,959,534

4,093,456

252,153

(*1)
(*2)

(*1) ( : )

(33,079,057)

(27,468,487)

(27,468,487)

(32,175,868)

5,610,570

(4,707,381)

79

22. Earnings per share


A. Basic earnings per share
The details of the basic EPS of shareholdings of the consolidated company are as follows (Unit: share, KRW).
(1) Basic earnings per share
Detail

Current Accounting Period Previous Accounting Period

Ownership of the parent companys net income (loss)


The weighted average of common circulating shares
Basic earnings per share (loss)

885,223,989

(50,507,860,299)

300,000

300,000

2,951

(168,360)

(2) Weighted average of common shares outstanding.


Current Accounting
Period

Detail

Previous Accounting
Period

Common shares issued between Jan. 1st to Dec. 31st.

300,000

300,000

The weighted average number of common circulating


shares

300,000

300,000

B.

Diluted earnings per share

There is no influence of dilution in the current and the previous accounting periods, so the earnings per diluted
share equal to the basic earnings per share.
23. Corporate income tax expenses
A.

Configuration details of income tax expense

The details of income tax expenses of the Group in the current and the previous accounting periods are as
follows: (Unit: KRW 000)
Division

Current Accounting Period Previous Accounting Period

Tax burden

Changes in deferred corporate income taxes due to


temporary differences (*1)

5,610,570

(4,707,381)

Income tax expense reflected directly in equity (*2)

(1,517,114)

4,959,534

4,093,456

252,153

Income tax expense

(*1) Changes in deferred corporate income taxes due to temporary differences: (Unit: KRW 000)
Division

Current Accounting Period

Previous Accounting Period

Closing balance of deferred income tax liabilities

(33,079,057)

(27,468,487)

Beginning balance of deferred income tax liabilities

(27,468,487)

(32,175,868)

5,610,570

(4,707,381)

Movements in deferred tax

80

(*2) ( : )

(1,894,444)

(377,330)

(377,330)

(5,336,864)

(1,517,114)

4,959,534

.
( : ).

4,495,267

(50,255,707)

988,958

(11,056,255)

3,104,498

11,308,408

(8,814,959)

180,618

6,108,434

( )

2,923,880

14,014,933

4,093,456

252,153

91.06%

. ()

() ( :
).

81

(*2) Changes in deferred taxes accounted for directly into equity (Unit: KRW 000)

Division
Closing balance of deferred taxes liabilities
accounted for directly into equity
Beginning balance of deferred taxes liabilities
accounted for directly into equity
Movements in deferred tax directly reflected in
equity
B.

Current Accounting Period

Previous Accounting Period

(1,894,444)

(377,330)

(377,330)

(5,336,864)

(1,517,114)

4,959,534

The relationship between income before taxes and expenses of income tax.

Current and previous period income before tax and adjustments to expenses of income tax is as follows. (Unit:
KRW 000)
Division
Profits/loss before income tax expense

Current Accounting Period

Previous Accounting Period

4,495,267

(50,255,707)

988,958

(11,056,255)

3,104,498

11,308,408

(8,814,959)

180,618

6,108,434

Others (including unrecognized deferred tax assets)

2,923,880

14,014,933

Income tax expense

4,093,456

252,153

91.06%

In accordance with the applicable tax rate


Adjustments
Non-taxable income
Unauthorized expenses

The effective tax rate


C.

Changes of temporary differences and deferred income tax assets (liabilities)

Current and previous period changes of temporary differences and deferred income tax assets (liabilities) are as
follows: (Unit: KRW 000)

82

()

12

12

()

( )

1,444,950

1,444,950

1,539,202

1,539,202

338,624

338,624

3,665,000

2,000,000

1,665,000

366,300

366,300

18,500

18,500

4,070

4,070

21,446,799

6,895,973

14,550,826

3,201,182

3,201,182

17,272

17,272

24,753

24,753

5,446

5,446

6,262,341

6,262,341

1,377,715

1,377,715

22,500,000

22,500,000

4,950,000

4,950,000

()

6,700,135

6,700,135

1,474,030

1,474,030

24,820,012

1,943,968

22,876,044

5,032,730

5,032,730

88,667

28,000

5,156

65,823

14,481

14,481

184,901

87,851

1,796

98,846

21,746

21,746

20,672

20,672

18,500

18,500

4,070

4,070

100,000

100,000

22,000

22,000

1,276,275

1,276,275

280,781

280,781

46,229,865

2,626,682

15,985,362

59,588,545

13,109,480

13,109,480

134,775,389

15,065,368

17,574,769

137,284,790

30,202,655

370,140

29,832,515

25,623,758

370,140

25,253,618

4,578,897

4,578,897

4,578,897

4,578,897

( )

(111,220,995)

(21,712,582)

(132,933,577)

(29,245,387)

(29,245,387)

(28,550,592)

(28,550,592)

(6,281,130)

(6,281,130)

(1,098,472)

(961,246)

(1,428,396)

(1,565,622)

(344,437)

(344,437)

(4,963,044)

1,491,567

(3,471,477)

(763,725)

(763,725)

()

(6,636,296)

2,030,745

(4,605,551)

(1,013,221)

(1,013,221)

(32,962)

(32,962)

(63,540)

5,781

23,619

(45,702)

(10,054)

(10,054)

(2,312)

(18,500)

(16,188)

(3,561)

(3,561)

(152,565,901)

(990,739)

(19,613,547)

(171,188,709)

(37,661,515)

(344,437)

(37,317,078)

(3,561)

(3,561)

(37,657,954)

(344,437)

(37,313,517)

(37,657,954)

(344,437)

(37,313,517)

()

(33,079,057)

(344,437)

(32,734,620)

83

(Current Accounting Period)


Temporary differences
Balance at
Division
the
Beginning
(Deductible temporary differences)
Allowance for bad debts

Decrease

Balance at the
End of the
Year

Increase

Deferred
Income Tax
Assets
(Liabilities)

Within 12
Months

After 12
Months

1,444,950

1,444,950

1,539,202

1,539,202

338,624

338,624

3,665,000

2,000,000

1,665,000

366,300

366,300

18,500

18,500

4,070

4,070

21,446,799

6,895,973

14,550,826

3,201,182

3,201,182

17,272

17,272

24,753

24,753

5,446

5,446

Bond repayment premium

6,262,341

6,262,341

1,377,715

1,377,715

Redeemable, convertible,
and preferential shares

22,500,000

22,500,000

4,950,000

4,950,000

Repayment premiums
6,700,135
(preferential shares)
Loss on valuation of
24,820,012
derivatives
Improvement to property of
88,667
leased fixed assets

6,700,135

1,474,030

1,474,030

1,943,968

22,876,044

5,032,730

5,032,730

28,000

5,156

65,823

14,481

14,481

184,901

87,851

1,796

98,846

21,746

21,746

Recovery provisions

20,672

20,672

18,500

18,500

4,070

4,070

Other current assets

100,000

100,000

22,000

22,000

1,276,275

1,276,275

280,781

280,781

Impairment loss of
available-for-sale financial
assets
Impairment loss of held-tomaturity securities
Other comprehensive
income related to
subsidiaries equity
Accrued expenses

Defined benefit liabilities

Impairment loss of
intangible assets
Loss carried forward
Subtotal

46,229,865

2,626,682 15,985,362

59,588,545

13,109,480

13,109,480

134,775,389

15,065,368 17,574,769

137,284,790

30,202,655

370,140

29,832,515

25,623,758

370,140

25,253,618

4,578,897
4,578,897

4,578,897
4,578,897

Recognized amount excluding deferred income tax assets


Recognized amount of deferred income tax assets
Deferred tax assets
( Temporary taxable differences)
Investments in
(111,220,995)
subsidiaries

(21,712,582)

(132,933,577)

(29,245,387)

(29,245,387)

(28,550,592)

(28,550,592)

(6,281,130)

(6,281,130)

Accrued income

(1,098,472)

(961,246)

(1,428,396)

(1,565,622)

(344,437) (344,437)

Discount on bonds

(4,963,044)

1,491,567

(3,471,477)

(763,725)

(763,725)

(6,636,296)

2,030,745

(4,605,551)

(1,013,221)

(1,013,221)

(32,962)

(32,962)

(63,540)

5,781

23,619

(45,702)

(10,054)

(10,054)

(2,312)

(18,500)

(16,188)

(3,561)

(3,561)

(990,739) (19,613,547)

(171,188,709)

(37,661,515) (344,437)

(37,317,078)

Equity of subsidiariess
earnings

Adjustment of
conversion rights
(preferential shares)
Gains from foreign
currency conversion
Other impairment losses
from securities
investment
Improvement to
property of leased fixed
assets
Subtotal

(152,565,901)

Recognized amount excluding deferred income tax assets


Recognized amount of deferred income tax liabilities

(3,561)

(3,561)

(37,657,954) (344,437)

(37,313,517)
84

Deferred income tax liabilities


Deferred income tax assets (liabilities)

(37,657,954) (344,437)
(33,079,057) (344,437)

(37,313,517)
(32,734,620)

()

12

12

()

( )

1,180,822

1,180,822

1,444,950

1,444,950

317,889

317,889

3,665,000

3,665,000

806,300

806,300

18,500

18,500

4,070

4,070

11,011,922

10,434,877

21,446,799

4,718,296

4,718,296

8,822

8,822

17,272

17,272

3,799

3,799

24,677

24,677

12,758,993

6,496,652

6,262,341

1,377,715

1,377,715

18,460,185

24,420,332

28,460,148

22,500,000

4,950,000

4,950,000

9,563,675

12,651,452

9,787,911

6,700,135

1,474,030

1,474,030

()

24,820,012

24,820,012

5,460,403

5,460,403

7,000,000

7,000,000

2,364,872

2,364,872

46,667

42,000

88,667

19,507

19,507

68,313

27,116

143,704

184,901

40,678

40,678

20,672

20,672

4,548

4,548

100,000

100,000

22,000

22,000

1,276,275

1,276,275

280,781

280,781

29,746,051

672,694

15,811,120

46,229,865

10,170,571

10,170,571

96,039,174

672,694

54,174,748

92,238,269

134,775,389

29,650,587

348,236

29,302,351

23,554,576

348,236

23,206,340

6,096,011

6,096,011

6,096,011

6,096,011

( )
(111,220,995

(92,618,261)

(5,768,956) (24,371,690)

(24,468,619)

- (24,468,619)

(1,237,982)

(1,111,121)

(963,275)

(950,626)

(525,425)

525,425

(358,238)

(358,238)

(12,980,335)

(8,017,291)

(1,451,029)

()

(29,788,574)

- (28,550,592)

(6,281,130)

(6,281,130)

(1,098,472)

(241,663)

(241,663)

(4,963,044)

(1,091,870)

(1,091,870)

(2,055,003)

(7,240,270)

(6,636,296)

(1,459,985)

(1,459,985)

()

(27,107,297)

- (27,107,297)

(13,490,652)

- (13,490,652)

85

(The previous accounting period)


Temporary Differences
Balance at Modifica
Decreas
the Beginning tion
e
of the Period Basis

Division

Deferred
Income Tax
Assets
(Liabilities)

Balance at
the End of
the Period

Increase

Within
12
Months

After 12
Months

Deductible temporary differences


Allowance for bad debts

1,180,822

- 1,180,822

Impairment loss of availablefor-sale financial assets

1,444,950

1,444,950

317,889

317,889

3,665,000

3,665,000

806,300

806,300

18,500

18,500

4,070

4,070

11,011,922

- 10,434,877 21,446,799

4,718,296

4,718,296

8,822

8,822

17,272

17,272

3,799

3,799

24,677

24,677

12,758,993

6,496,652

6,262,341

1,377,715

1,377,715

Redeemable, convertible, and


18,460,185
preference shares

- 24,420,332 28,460,148 22,500,000

4,950,000

4,950,000

Repayment premiums
(preference shares)

- 12,651,452

6,700,135

1,474,030

1,474,030

- 24,820,012 24,820,012

5,460,403

5,460,403

Impairment loss of held-tomaturity securities


Other comprehensive income
related to enterprise equity
Accrued expenses
Impairment loss of assets and
other investments
Bond repayment premium

9,563,675

Loss on valuation of
derivatives

9,787,911

7,000,000
2,364,872

7,000,000
2,364,872

46,667

42,000

88,667

19,507

19,507

68,313
20,67
100,00

27,116
-

143,704
-

184,901
20,672
100,000

40,678
4,548
22,000

4,548
22,000

40,678
-

1,276,275

1,276,275

280,781

280,781

Loss carried forward


29,746,051 672,694
- 15,811,120 46,229,865
Subtotal
96,039,174 672,694 54,174,748 92,238,269 134,775,38
Recognized amount excluding deferred income tax assets

10,170,571
29,650,587
23,554,576

Held-to-maturity securities
Long-term accrued interest
Gains from foreign currency
conversion
Improvement to property of
leased fixed assets
The defined benefit liabilities
Recovery provisions
Other current assets
Impairment loss of intangible
assets

- 10,170,571
348,236 29,302,351
348,236 23,206,340

Recognized amount of deferred income tax liabilities

6,096,011

6,096,011

Deferred tax assets

6,096,011

6,096,011

(Taxable temporary differences)


Investments in subsidiaries (92,618,261)

(5,768,95 (24,371,690 (111,220,99


(24,468,619)
- 6)
)
5)

Equity of subsidiariess
earnings

Accrued income
Accounts receivable
Derivative gains
Bond issue discounts
Adjustment of conversion
rights (preferential shares)
Conversion rights
(derivatives)

(29,788,574)
(1,111,121)
(525,425)
(358,238)
(12,980,335)

(1,237,98
2)

- (963,275)
525,425

(28,550,592
)

(950,626) (1,098,472)

- (358,238)
- (8,017,29

(24,468,619
-)

(6,281,130)

- (6,281,130)

(241,663) (241,663)

- (4,963,044)

(1,091,870)

- (1,091,870)

(1,459,985)

- (1,459,985)

(1,451,029)

(2,055,00
(7,240,270) (6,636,296)
3)

(27,107,297)

(27,107,2
97)

86

Available-for-sale financial
assets

(13,490,652)

(13,490,6
52)

(32,962)

(32,962)

(7,252)

(7,252)

(63,540)

(63,540)

(13,979)

(13,979)

(10,336)

(10,336)

(179,441,268

(152,565,901
525,425 (59,009,030) (32,659,088)

(33,564,498)

(241,663) (33,322,835)

(33,564,498)

(241,663) (33,322,835)

(33,564,498)

(241,663) (33,322,835)

()

(27,468,487)

(241,663) (27,226,824)

87

Gains from foreign currency


conversion

(32,962
)

(32,962)

(7,252)

(7,252)

Other impairment losses of


investment securities

(63,540
)

(63,540)

(13,979)

(13,979)

(10,336)

(10,336)

Improvement to property of
leased fixed assets
Subtotal

(179,441,269 525,425

Recognized amount excluding deferred income tax assets

(152,565,90

Recognized amount of deferred income tax liabilities

(33,564,498) (241,663) (33,322,835

Deferred income tax liabilities

(33,564,498) (241,663) (33,322,835

Deferred income tax assets (liabilities)

(27,468,487) (241,663) (27,226,824

88

.

25,623,758
23,554,576 .
.

( : ).

2009

4,307,204

2019 12 31

2010

3,145,249

2020 12 31

2011

6,948,065

2021 12 31

2012

13,391,545

2022 12 31

2013

15,811,120

2023 12 31

2014

15,985,362

2024 12 31

59,588,545

.
( : ).

(1,517,114)

2,295,674

2,329,320

334,540

(1,517,114)

4,959,534


( : ).

25,897

1,052,584

25,897

1,052,584

89

D. Review of the realization possibility of deferred income tax assets


After the reivew of the realization possibility of deferred income tax assets, the unrecognized deferred income
tax assets in the current and the end previous accounting period are respectively KRW 25,623,758,000 and KRW
23,554,576,000.
E.

The amount and due date of unused tax losses that have not been recognized as deferred tax assets.

The amount and due date of deductible tax losses that have not been recognized as deferred income tax assets
are as follows: (Unit: KRW 000)
Year of Issuance

F.

Amount

Due Date

2009

4,307,204

31 Dec 2019

2010

3,145,249

31 Dec 2020

2011

6,948,065

31 Dec 2021

2012

13,391,545

31 Dec 2022

2013

15,811,120

31 Dec 2023

2014

15,985,362

31 Dec 2024

Total

59,588,545

The direct effect of the income tax on capital accounts.

The effects of income tax directly reflected in equity in the current and the previous accounting period are as
follows: (Unit: KRW 000)
Division
Investments

Current Accounting Period

Previous Accounting Period

(1,517,114)

2,295,674

Available-for-sale financial assets, gains


and losses

2,329,320

Related income from redeemable,


convertible, and preferential stock

334,540

(1,517,114)

4,959,534

Total
G.

The current period income tax assets and liabilities before being offset.

As of the end of the reporting period, the current income tax assets and the current income tax liabilities
before being offset are as follows: (Unit: KRW 000)
Division
Current income tax assets before adjustment
Current income tax liabilities before
adjustment
Current income tax assets after adjustment

Current Accounting Period

Previous Accounting Period

25,897

1,052,584

25,897

1,052,584
90

.

( : ).

4,578,897

6,096,011

(37,657,954)

(33,564,498)

()

(33,079,057)

(27,468,487)

24.
. ( : ).

21,547,135

24,371,690

165,478

11,286,733

11,403,225

17,009,509

297,546

1,001,003

1,328,468

34,741,852

53,668,935

. ( : )

20,953,840

12,222,949

17,405,715

277,841

1,065,837

444,756

12,945,546

39,425,392

91

H.

The deferred income tax assets and the deferred income tax liabilities before being offset.

As of the end of the reporting period, the deferred income tax assets and the deferred income tax liabilities
before being offset are as follows: (Unit: KRW 000)
Division
Deferred tax assets before adjustment

Current Accounting Period

Previous Accounting Period

4,578,897

6,096,011

Deferred tax liabilities before adjustment

(37,657,954)

(33,564,498)

Deferred tax net assets (liabilities) after


adjustment

(33,079,057)

(27,468,487)

24. Sales revenues and costs


A.

The sale revenues of the Group in the current and the previous accounting periods are as follows:
(Unit: KRW 000)
Division

Interest in the profits of associated company

Current Accounting Period

Previous Accounting Period

21,547,135

24,371,690

165,478

11,286,733

11,403,225

17,009,509

Sales from events

297,546

1,001,003

Sales of services

1,328,468

34,741,852

53,668,935

Gains on disposal of investments in associates


Broadcasting revenues

Total
B.

The sales costs of the Group in the current and the previous accounting periods are as follows:
(Unit: KRW 000)
Division

Losses on disposal of investments in associates

Current Accounting Period

Previous Accounting Period


-

20,953,840

12,222,949

17,405,715

Sales from event costs

277,841

1,065,837

Service sales costs

444,756

12,945,546

39,425,392

Broadcasting costs

Total

92

25.
( : ).

1,683,829

1,395,614

245,993

234,122

62,523

64,831

30,244

30,317

156,301

195,493

17,047

16,824

33,203

5,720

199,100

215,214

264,330

297,145

27,098

31,456

71,682

70,456

1,117,934

44,000

203,316

1,255,427

3,558

1,891

229,865

223,860

109,878

160,019

4,455,901

4,242,389

26.

( : ).

2,283,428

2,264,719

234,936

278,332

14,883,083

20,170,890

17,401,447

22,713,941

93

25. Selling and administrative expenses


The selling and administrative expenses of the Group in the current and previous periods are as follows (Unit:
KRW 000)
Division
Salary

Current Accounting Period

Previous Accounting Period

1,683,829

1,395,614

245,993

234,122

Employee benefits

62,523

64,831

Transportation costs

30,244

30,317

156,301

195,493

Electricity costs

17,047

16,824

Tax

33,203

5,720

Depreciation

199,100

215,214

Rental payments

264,330

297,145

Insurance expenses

27,098

31,456

Car repair expenses

71,682

70,456

Bad debts expenses

1,117,934

44,000

203,316

1,255,427

3,558

1,891

Service charges

229,865

223,860

Etc.

109,878

160,019

Total

4,455,901

4,242,389

Severance pay

Entertainment expenses

Commission expenses
Amortization

26. Division of expenses


The division of expenses of the Group in the current and previous periods is as follows (Unit: KRW 000)
Division
Employee benefits

Current Accounting Period

Previous Accounting Period

2,283,428

2,264,719

234,936

278,332

Other expenses

14,883,083

20,170,890

Total selling and administrative expenses

17,401,447

22,713,941

Depreciation and amortization

94

27.
( : ).

45,076

164,379

311

209,455

311

1,000

1,000

487,299

266,280

51,676

1,276,275

37,200

37,200

109,165

282,447

686,340

1,863,202

28.
. ( : ).

854,963

1,817,952

32,962

2,236

232

1,943,968

11,427,685

5,781

78,340

69,265

975,000

1,627,815

2,876,213

15,959,986

. ( : ).

15,174,554

21,092,872

648

537

25,178,250

27,107,297

69,265

975,000

15,244,467

74,353,956

95

27. Other revenue and expenses


The other revenue and expenses of the Group in the current and previous periods are as follows
(Unit: KRW 000)
Division

Current Accounting Period

Previous Accounting Period

Other income
Gains on disposal of tangible assets

45,076

Job losses

164,379

311

Total

209,455

311

1,000

1,000

487,299

266,280

51,676

1,276,275

37,200

37,200

Other losses

109,165

282,447

Total

686,340

1,863,202

Other expenses
Donations
Other bad debt expenses
Losses on disposal of tangible assets
Impairment of intangible assets
Service charges

28. Financial Income and costs


A. The financial income in the current and the previous periods are as follows (Unit: KRW 000)
Division
Financial income

Current Accounting Period

Previous Accounting Period

854,963

1,817,952

32,962

2,236

232

1,943,968

11,427,685

Other financial asset valuations

5,781

78,340

Financially guaranteed revenues

69,265

975,000

1,627,815

2,876,213

15,959,986

Gains on foreign currency


conversion
Currency arbitrage
Derivative gains
Gains on disposal of available for
sale financial assets

Bond interest repayments


Total
B.

The financial costs in the current and the previous periods are as follows (Unit: KRW 000)
Division

Interest expenses

Current Accounting Period

Previous Accounting Period

15,174,554

21,092,872

648

537

Loss on valuation of derivatives

25,178,250

Loss on disposal of derivatives

27,107,297

69,265

975,000

15,244,467

74,353,956

Loss on foreign currency


transactions

Financially guaranteed expenses


Total

96

. ( : ).

/(*)

(27,465,535)

(27,465,535)

11,427,685

11,427,685

860,744

1,895,987

854,963

1,817,952

5,781

78,035

1,943,968

(24,820,012)

1,943,968

(24,820,012)

(15,172,966)

(19,432,095)

(15,174,554)

(21,092,872)

1,588

1,660,777

(12,368,254)

(58,393,970)

(14,319,591)

(19,274,920)

1,951,337

(39,119,050)

(*) / .
29.
( : ).

1,792,820

1,838,182

151,060

44,500

264,890

268,723

74,658

113,314

2,283,428

2,264,719

30.
. ( : ).

401,810

(50,507,860)

118,233

145,028

231,378

276,441

3,558

1,891

1,276,275

97

C.

The financial income and costs in the current and the previous periods are as follows (Unit: KRW 000)
Interest Income / Expense
(*)

Division

Other Income / Expenses

Financial assets at
fair value through
profit or loss

(27,465,535)

- (27,465,535)

Available-for-sale
financial assets

11,427,685

11,427,685

860,744

1,895,987

854,963

1,817,952

5,781

78,035

1,943,968 (24,820,012)

Loans and receivables


Financial liabilities at
fair value through
profit or loss
Financial liabilities
measured at
amortized cost

(15,172,966) (19,432,095) (15,174,554) (21,092,872)

Total

(12,368,254) (58,393,970) (14,319,591) (19,274,920)

1,943,968 (24,820,012)

1,588

1,660,777

1,951,337 (39,119,050)

(*) It includes the interest revenue/expenses caused by the changes in the effective interest rate.
29. Employee Compensation
The employee compensations in the current and previous periods are as follows (Unit: KRW 000)
Division

Current Accounting Period

Previous Accounting Period

Salaries

1,792,820

1,838,182

Bonuses

151,060

44,500

Severance pay

264,890

268,723

74,658

113,314

2,283,428

2,264,719

Employee benefits
Total

30. Details of the Cash Flow Statement


A. Adjustments to operating cash flow and changes in net working capital are as follows: (Unit: KRW 000)
Division
Net income

Current Accounting Period

Previous Accounting Period

401,810

(50,507,860)

Severance pay

118,233

145,028

Depreciation

231,378

276,441

Amortization

3,558

1,891

1,276,275

Adjustment divisions:

Impairment loss of intangible assets

98

1,117,934

44,000

487,299

266,280

(1,943,968)

25,178,250

27,107,297

(21,547,135)

(24,371,690)

(165,478)

(11,286,733)

20,953,840

(11,427,685)

(45,076)

51,676

(5,781)

(78,340)

(854,963)

(1,817,952)

15,174,554

21,092,872

4,093,456

252,153

69,265

975,000

(69,265)

(975,000)

69,429

1,800,000

(1,627,815)

(32,962)

(3,214,883)

47,751,150

2,798,058

(2,429,260)

57,297

168,825

2,111,590

(1,069,017)

(69,429)

(25,000)

471,341

(1,221,948)

(2,061,481)

834,948

(2,807,223)

1,205,484

(22,550)

22,550

(19,735)

(155,630)

(27,116)

277,238

(2,515,534)

(2,535,835)

(5,272,244)

99

Bad debt expenses

1,117,934

44,000

487,299

266,280

(1,943,968)

Loss on valuation of derivatives

25,178,250

Loss on disposal of derivatives

27,107,297

(21,547,135)

(24,371,690)

(165,478)

(11,286,733)

20,953,840

(11,427,685)

(45,076)

Loss on disposal of tangible assets

51,676

Other financial asset valuations

(5,781)

(78,340)

(854,963)

(1,817,952)

15,174,554

21,092,872

4,093,456

252,153

Financially guaranteed expenses

69,265

975,000

Financially guaranteed revenues

(69,265)

(975,000)

69,429

Service charges

1,800,000

Repayment interest of bonds

(1,627,815)

Gains on foreign currency transactions

(32,962)

(3,214,883)

47,751,150

2,798,058

(2,429,260)

57,297

168,825

2,111,590

(1,069,017)

Inventories

(69,429)

Other long-term receivables

(25,000)

Other non-current assets

471,341

(1,221,948)

Accounts payables

(2,061,481)

834,948

Other debt payments

(2,807,223)

1,205,484

Other current liabilities

(22,550)

22,550

Other long-term payment obligations

(19,735)

(155,630)

(27,116)

277,238

(2,515,534)

(2,535,835)

(5,272,244)

Other bad debt expenses


Derivative gains

Equity with regards to related parties profit


Gain on disposal of investments in
associates
Loss on disposal of investments in associates
Gain on disposal of available-for-sale
financial assets
Gain on disposal of tangible assets

Interest income
Interest expenses
Income tax expenses

Valuation loss

Total adjustment
Changes in net working capital:
Accounts receivable
Other receivables
Other current assets

Redundancy payments
Total changes in net working capital
Cash generated from operations

100

. ( :
).

712,958

10,351,616

24,908,520

11,187,336

71,649

2,703,333

31.
.
( : ).

() 381,100

NH

7,500,000

() 1,586,200

17,250,000

() 1,377,627

20,000,000

() 1,036,272

KDB

30,000,000

() 471,508

10,000,000

() 280,449

7,000,000

() 936,000

20,000,000

() 297,266

5,000,000

() 201,289

LIG

5,000,000

() 247,832

5,000,000

() 742,351

NH

20,000,000

() 207,814

5,000,000

() 769,925

ORIX CORPORATION

1,000,000 (*)
() 917,137

151,750,000

(*) 3 1,200,000 .

101

The important transactions without cash flow of the Group in the current and the previous periods are as follows
(Unit: KRW 000)
Current Accounting
Period

Division
Loans and other receivables as alternative assets under
construction

Previous Accounting
Period

712,958

10,351,616

Short-term financial liabilities repaid by available-for-sale financial


assets

24,908,520

Short-term financial debt as short-term loans

11,187,336

Deferred income tax from conversion rights

71,649

Alternative long-term prepaid prepayments

2,703,333

31. Mortgage Assets


A. Details of the Mortgage assets
As of End of The current accounting period, the mortgage assets are as follows (Unit: KRW 000)
Mortgage Assets
381,100 shares of Celltrion

Mortgage Providers

Debt Balance

Detail

NH Capital

7,500,000

Mortgage loans

1,586,200 shares of Celltrion

NH Bank

17,250,000

Mortgage loans

1,377,627 shares of Celltrion

Korea Securities Finance

20,000,000

Mortgage loans

1,036,272 shares of Celltrion

KDB Daewoo Securities

30,000,000

Mortgage loans

471,508 shares of Celltrion

Hyundai Securities

10,000,000

Mortgage loans

280,449 shares of Celltrion

Kyobo Securities

7,000,000

Mortgage loans

936,000 shares of Celltrion

Korea Investment &


Securities

20,000,000

Mortgage loans

297,266 shares of Celltrion

Samsung Securities

5,000,000

Mortgage loans

201,289 shares of Celltrion

LIG Investment &


Securities

5,000,000

Mortgage loans

247,832 shares of Celltrion

Hanwha Securities

5,000,000

Mortgage loans

742,351 shares of Celltrion

NH Investment &
Securities

20,000,000

Mortgage loans

207,814 shares of Celltrion

Dongbu Securities

5,000,000

Mortgage loans

769,925 shares of Celltrion

Korea Securities Finance

Third party guarantee

NH Bank

Third party guarantee

ORIX CORPORATION

Derivative guarantee

KRW 1 BN time deposits


917,137 shares of Celltrion
Total

151,750,000
102

(*) As the guarantee for the third party, the mortgage quota of the fixed deposit is 1,200 KRW MN.

.
( : ).

() 29,633 ()

50,231,342

, () 1,329
.
.
.

()

1,000,000

() 769,925

.
( : ).

21,300,000

.
.

()

USD 10,000,000 KDB Bank Europe Ltd.

, () (
) .

103

B.

Details of the collateral received from others

As of the end of the current period, the collateral received from others are as follows (Unit: KRW 000)
Mortgage Providers

Mortgage Details

Borrowing Sources

Our CEO

29,633 shares of Celltrion


Healthcare

Celltrion GSC

Loan Amount

Notes

50,231,342

Provided mortgage
loans

Moreover, the Group provided 1,329 shares of Celltrion Healthcare as the collateral for the short-term loans.
C.

Details of the collateral provided to others

As of the end of the current period, the collateral provided to others is as follows
Collateral of the Receiver

Mortgage Details

Borrowing S

Notes

Third party

KRW 1BN time deposits

NH Bank

Provide mortgage loans

Celltrion GSC

769,925 shares of Celltrion

D.

Korea Securities Finance Provide mortgage loans

Details of the payment collateral received from others

As of the end of the current period, the payment collateral received from others are as follows (Unit: KRW 000)
Division
Convertible bonds

E.

Amount
21,300,000

Guarantee Provider
Our CEO

Notes
Joint and several
Guarantee

Details of the payment collateral provided to others

As of the end of the current period, the payment guarantee provided to others are as follows
Provider

Amount

Borrowing Sources

Notes

Celltrion Healthcare

USD 10,000,000

KDB Bank Europe Ltd.

Joint and several


Guarantee

The Group undertakes the joint and several guarantee obligation for the debts of Celltrion Healthcare which
occurred before spinning off. Celltrion Holdings is the remaining enterprise after the spin-off of the Group.

104

.
.( : )

11,000,000

10,000,000

17,250,000

17,250,000

20,000,000

20,000,000

KDB

40,000,000

30,000,000

7,000,000

7,000,000

20,000,000

20,000,000

20,000,000

5,000,000

LIG

5,000,000

5,000,000

5,000,000

5,000,000

5,000,000

5,000,000

32.
.
.

()

()

(),
(),
(),
()

(),
(),

(),
()

105

F.

Major agreement matters

As of the end of the current period, the main agreements signed with financial institutions are as follows
(Unit: KRW 000)
Accounts

Short-term borrowings

Division

Financial
Institutions

Deposit collateral
loan

Hyundai Securities

11,000,000

10,000,000

Ordinary loan

Agricultural Bank

17,250,000

17,250,000

Ordinary mortgage
loan

Korea Securities
Finance

20,000,000

20,000,000

Mortgage deposit

KDB Daewoo
Securities

40,000,000

30,000,000

mortgage deposit

Kyobo Securities

7,000,000

7,000,000

Mortgage loan
company

Korea Investment &


Securities

20,000,000

20,000,000

Deposit collateral
loan

Samsung Securities

20,000,000

5,000,000

Deposit collateral
loan

LIG Investment &


Securities

5,000,000

5,000,000

Deposit collateral
loan

Hanwha Securities

5,000,000

5,000,000

Deposit collateral
loan

Dongbu Securities

5,000,000

5,000,000

Ceiling Agreement

Running Money

32. Transactions with related parties


Related parties in the current and the previous periods and the transactions with them are as follows:
A.

Related Parties
Division

End of Current Accounting Period

End of Previous Accounting Period

Manager

Seo Jung-jin

Seo Jung-jin

Corporate relations

Celltrion

Celltrion

Etc.

Celltrion Healthcare,
Celltrion GSC,
Celltrion Pharm, Hanskin
Shareholders and executives, etc.

Celltrion Healthcare,
Celltrion GSC,
Celltrion Pharm, Hanskin
Shareholders and executives, etc.

106

. ( : )

()

45,618

378,037

156,420

1,246,954

480

3,984,293

2,879,201

36,100

170,805

()

100,079

337,042

()

122,443

74,274

232,852

59,548

242,692

4,377,762

1,261,094

8,456,111

703,352

8,436,329

3,626,784

11,395,340

()
()

. ( : )

722,240

()

103,634
-

()
()

()
()

676,622

290,208

2,796

52,597,563

264

67,702,594

605

1,379

1,640

313,500

1,107,356

180,000

1,033,082

4,024,938

51,355,852

4,215,681

48,728,857

5,165,691

105,060,771

5,365,020

117,467,329

.
( : ).
()

661,125

661,125

3,700,000

26,000

327,530

3,398,470

4,361,125

26,000

327,530

4,059,595

107

B.

Major transactions with related parties (Unit: KRW 000)

Division
Manager

Seo Jung-jin

Corporate
relations

Celltrion

Current Accounting Period

Previous Accounting Period

Revenue

Revenue
-

378,037

156,420

1,246,954

480

3,984,293

2,879,201

36,100

170,805

Celltrion Healthcare

100,079

337,042

Hanskin

122,443

74,274

232,852

59,548

Etc.

242,692

4,377,762

1,261,094

8,456,111

703,352

8,436,329

3,626,784

11,395,340

Celltrion Pharm

Total
C.

Cost

45,618

Celltrion GSC

Other related
parties

Cost

Details of the main claims and liabilities resulting from transactions with related parties (Unit: KRW 000)
End of Current Accounting Period
Division

Bad Debt
Reserves

Bonds

End of Previous Accounting Period

Debt

Bonds

Bad Debt
Reserves

Debt

Manager

Seo Jung-jin

722,240

676,622

Corporate
relations

Celltrion

103,634

290,208

2,796

Celltrion GSC

- 52,597,563

264

- 67,702,594

Celltrion Pharm

605

1,379

1,640

313,500

1,107,356

180,000

1,033,082

4,024,938

- 51,355,852

4,215,681

- 48,728,857

5,165,691

- 105,060,771

5,365,020

- 117,467,329

Other related Celltrion


parties
Healthcare
Hanskin
Etc.
Total

D. Loans
Details of the changes in loans in claims related to transactions with related parties are as follows
(Unit: KRW 000)
(Current period)
Division
Manager
Etc.
Total

Beginning

Increase

Decrease

Ending

661,125

661,125

3,700,000
4,361,125

26,000
26,000

327,530
327,530

3,398,470
4,059,595
108

()

10,004,147

1,161,125

10,504,147

661,125

363,478

363,478

()

7,000,000

7,000,000

()

23,000,000

23,000,000

1,823,000

1,900,000

23,000

3,700,000

12,190,625

33,061,125

40,527,147

4,724,603

()

.
( : ).
()

()
()

65,664,342

12,210,000

27,643,000

50,231,342

1,000,000

1,000,000

102,900

102,900

66,767,242

12,210,000

27,643,000

51,334,242

()

()
()

19,203,559

92,809,742

46,348,959

65,664,342

3,000,000

2,000,000

1,000,000

102,900

102,900

19,306,459

95,809,742

48,348,959

66,767,242

109

(Previous period)
Division
Manager

Beginning

Increase

Decrease

Ending

10,004,147

1,161,125

10,504,147

661,125

363,478

363,478

Celltrion Healthcare

7,000,000

7,000,000

Celltrion Pharm

23,000,000

23,000,000

Etc.

1,823,000

1,900,000

23,000

3,700,000

Total

12,190,625

33,061,125

40,527,147

4,724,603

Celltrion ST

A.

Borrowing

Details of the major increase or decrease of borrowings resulting from transactions with related parties are as
followsUnit: KRW 000
(Current period)
Division
Celltrion GSC
Hanskin
Shareholders, etc.
Total

Beginning

Increase

Decrease

Ending

65,664,342

12,210,000

27,643,000

50,231,342

1,000,000

1,000,000

102,900

102,900

66,767,242

12,210,000

27,643,000

51,334,242

(Previous period)
Division
Celltrion GSC
Hanskin
Shareholders, etc.
Total

Beginning

Increase

Decrease

Ending

19,203,559

92,809,742

46,348,959

65,664,342

3,000,000

2,000,000

1,000,000

102,900

102,900

19,306,459

95,809,742

48,348,959

66,767,242

110

. ( : )

(*)

6.9

661,125

661,125

0~7

3,398,470

3,700,000

4,059,595

4,361,125

61,115

15,497

651,119

411,727

712,234

427,224

6.9

50,231,342

65,664,342

6.9

1,000,000

1,000,000

102,900

940,220

51,334,242

67,604,562

2,366,221

1,918,620

()

()

()

()

0~8.5

107,356

33,082

2,430,997

2,542,467

4,904,574

4,494,169

(*) ()
.
.

() 29,633
, () 1,329
( 31 ).
( 31
).
.

() 769,925 ( 31
).

111

E.

Receivables and payables on financial arrangements with related partiesUnit: KRW 000

Division

Loans (*)

Short-term
Interest Rates
(%)

Holder

Accrued
income

End of Previous
Accounting Period

Manager

Seo Jung-jin

6.9

661,125

661,125

Other related
parties

Others

0~7

3,398,470

3,700,000

4,059,595

4,361,125

Subtotal
Bonds

End of Current
Accounting Period

Manager

Seo Jung-jin

61,115

15,497

Other related
parties

Others

651,119

411,727

712,234

427,224

Subtotal

Other related
parties
Short-term
borrowings

Celltrion GSC

6.9

50,231,342

65,664,342

Hanskin

6.9

1,000,000

1,000,000

Others

0~8.5

102,900

940,220

51,334,242

67,604,562

2,366,221

1,918,620

Hanskin

107,356

33,082

Others

2,430,997

2,542,467

4,904,574

4,494,169

Subtotal
Celltrion GSC
Liabilities
Accrued
expenses

Other related
parties

Subtotal

(*)Stocks of Celltrion Healthcare are used as collateral of short-term loans to other related parties
F.

Details of collateral and guarantees from related parties

As of the end of the current period, the company acquired 29,633 Celltrion Healthcare shares from related
parties for the purpose of guaranteeing the lendings, and acquisitions of 1,329 Celltrion Healthcare shares for
the purpose of guaranteeing the short-term loans (See Note 31 for reference).
Acquire the joint guarantee related to convertible bonds from related parties at the end of current period.
(See Note 31 for reference)
G.

Guarantees provided to related parties

As of the end of current period, 769,925 shares of Celltrion stock are provided to related parties as collateral.
(See Note 31 for reference)

112

.
( : ).

1,110,702

1,072,986

174,432

194,492

1,285,134

1,267,478

33.
( : ).

440,000

()

113

H.

Remuneration of key management personnel

Remuneration of key management personnel of the Group in the previous and the current periods are as
follows: (Unit: KRW 000)

Division

Current Accounting Period

Salary and other short-term employee


benefits
Severance pay
Total

Previous Accounting Period

1,110,702

1,072,986

174,432

194,492

1,285,134

1,267,478

33. Pending litigation


The pending litigation whose defendant is the Group is as follows: (Unit: KRW 000)
Types of events
Billing address

Litigation amounts
440,000

Party

Progress

Notes

Ari Media

Trial of second
instance

Won in the first


instance

The final results of the lawsuit above cannot be reasonably predicted, therefore the impact of the results
were not reflected in the consolidated financial statement.

114

7 2
.

1.

2014 01 01

2014 12 31

2.
( : , )

( )

()

10

12

432

144

598

10

12

432

144

598

3.

()

2014
1
4

(2014 12

(2015 3

, ,

115

External Audit Contents


According to the provisions of Item 2, Article 7 of Act on External Audit of Stock Companies, the implementing
contents of external audit are shown in the attachment.

1. Audit object

Company name

Celltrion Holdings

Audited fiscal year

1 January 2014

from

31 December 2014

untill

2. Total numbers of audit participants in category and audit time


(Unit: person, time)
Audit Participants\
Number of People
and Time

Director
(Business ,
Management
Director)

Registered
Chartered
Accountants

Probationary
Chartered
Accountants

Computerized
Audit Tax
such as
Valuation
Experts

Auditor

Quality
Control
Reviewer
(Hearing
Room, etc.)

Total

Number of
employees

Review on
Numb
quarterly
er of
/semi-annual
Hours
reports
Took

Audit

10

12

432

144

598

Total

10

12

432

144

598

3. Major audits contents


Division
Overall audit plan
(undertaken steps)

Details
Performance time
Main content

April 2014

1 Day

Audit scope is based on auditors experience and analysis of auditees


past records.
Participants

Performance time

Residents

Performed analytical

Interim audit
8-10 December
Main audit contents
on site

2014

Major audit contents

Transients

procedures, records
3

day

3 Persons

Persons

inspection and recalculation


of balance on material
accounts and disclosures.
Acquired audit evidence

2-4 March 2015

Inventory-taking

Inspection time

day

3 Persons
-

Persons through audit procedures and


formed audit opinions.
-

Day

116

()
()

2015 1 5

()

()

(, , )

2014 12 10 , 2015 3 4

117

inspection location Inspection object

Inspection time
Financial due
diligence (presence)

5 Jan 2015

Day

Inspection location Incheon, Songdo, Yeonsu Headquarters


Inspection object

Cash, advance payments, original stock, etc.

Confirmation of
financial transactions

Bond debt Views

Bond debt
Views

External confirmation
Other views
Communication with
governance layer

Number of
communications
Performance Periods

Times
Dec 10, 2014 Mar 4, 2015

118