1999 Annual Report - Delta Electronics

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B. Except for DIH and DNI, which were included in the consolidation as described in Note 2, the other
majority-owned investments are accounted for under equity method because they do not meet the criteria
for consolidation as described in Note 2.
C. The investment income for 1999 and 1998 of Delta Electronics (Japan) Inc. and Delta Electronics Europe
Ltd. (DEU) amounting to $841 and $3,960, respectively, were recognized based on the investee companies'
financial statements, which were audited by other auditors. The 1999 and 1998 investment income from
DEU were recognized based on the Company's 1998 and 1997 ownership ratio applied to DEU's 1998 and
1997 financial statements. Except for the investee companies mentioned, the investment loss of other longterm
investments under equity method for the years ended December 31, 1999 and 1998 amounting to
$58,681 and $118,253, respectively, were recognized based on the audited financial statements of these
investee companies on the same year.
The financial statements of DIH were audited by other auditor. The investment loss for 1999 and 1998
amounting to $164,394 and $26,484 respectively, were recognized based on the investee company's
financial statements.
In December 1999, DNI invested in Addtron Technology Co., Ltd. DNI did not recognize the investment
income or loss in 1999 due to the short holding period from date of investment and DNI considered the
effect as not material.
D. The Company invested in Acute Applied Technology Inc. (AATI), representing 20% of AATI's voting rights
in the third quarter of 1998. The Company recognized the investment loss amounting to $706 in 1998
based on AATI's audited financial statements on the same year. During the second quarter of 1999, the
Company's percentage ownership changed to 16.36% because of the employee stock subscription and
technical shares in the new shares issued by AATI. As a result, the Company did not recognize investment
income commencing 1999.
E.
F.
The investee company, Luke Network Consulting Co., Ltd., accounted for under equity method was
liquidated in October 1999. The Company recognized the investment loss amounting to $184 in 1999.
The investee company, Advanced Display Systems, Inc. (ADS), had a negative net worth as of December 31,
1999. The Company considered the recovery of this investment is unlikely and recognized investment loss
amounting to $55,010 in 1999. As a result, the carrying value of the investment in ADS was reduced to
NT$1 dollar as of December 31, 1999.
G. The Company and its consolidated subsidiaries received cash dividends from investee companies accounted
for under cost method amounting to $113,197 and $104,352 in 1999 and 1998, respectively.