Page 64 - 2022 CPC Corporation,Taiwan

Financial Statements be sufficient taxable profits against which to utilize the temporary differences and they are expected to reverse in the foreseeable future. Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates and laws that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. (t) Earnings per share Basic earnings per share is calculated as the profit attributable to ordinary shareholders of the Company divided by the weighted average number of ordinary shares outstanding. Diluted earnings per share is calculated as the profit attributable to ordinary shareholders of the Company divided by the weighted average number of ordinary shares outstanding after adjustment for the effects of all potentially dilutive ordinary shares. The Company does not have potentially dilutive ordinary shares. (u) Operating segments An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the Company). Operating results of the operating segment are regularly reviewed by the Company’s chief operating decision maker to make decisions about resources to be allocated to the segment and to assess its performance. Each operating segment consists of standalone financial information. (5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty: The preparation of the financial statements in conformity with the accounting laws and regulations governing state- owned enterprises, the Regulations and with the IFRSs, IASs, interpretations as well as related guidance endorsed by the FSC of the Republic of China requires management to make judgments, estimates, and assumptions that affect the application of the accounting policies and the reported amount of assets, liabilities, income, and expenses. Actual results may differ from these estimates. The management continues to monitor the accounting estimates and assumptions. The management recognizes any changes in accounting estimates during the period and the impact of those changes in accounting estimates in the following period. Information about judgments made in applying accounting policies that have the most significant effects on the amounts recognized in the financial statements is as follows: Judgment regarding significant influence of investees The company holds 35%-49% of the voting shares of several investee companies, but because the remaining equity of these investee companies are concentrated in very few shareholders, the company cannot exercise more than half of the voting rights, nor can it obtain a majority of directors’ seats. Therefore, the company has only significant influence on these investee companies. Among the uncertainties of the assumptions and estimates, the relevant information that has significant risks may cause critical adjustments in the following years is as follows: (a) Estimated impairment of trade receivables The Company has estimated the loss allowance of trade receivable that is based on the risk of a default occurring and the rate of expected credit loss. The Company has considered historical experience, current economic conditions and forward-looking information at the reporting date to determine the assumptions to be used in calculating the impairments and the selected inputs. The relevant assumptions and input values, please refer to note 6 (c).