2010 Non Consolidated Report 1
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Transcript of 2010 Non Consolidated Report 1
HYUNDAI MOBIS Co., Ltd.
Non-Consolidated Financial Statements
December 31, 2010 and 2009
(With Independent Auditors‟ Report Thereon)
Contents
Page Independent Auditors’ Report 1 Non-consolidated Statements of Financial Position 3
Non-consolidated Statements of Income 5
Non-consolidated Statements of Appropriation of Retained Earnings 6
Non-consolidated Statements of Changes in Equity 7
Non-consolidated Statements of Cash Flows 8
Notes to Non-consolidated Financial Statements 10
Independent Auditors’ Review Report on Internal Accounting Control System 64
Report on the Operations of Internal Accounting Control System 65
Independent Auditors’ Report
Based on a report originally issued in Korean
The Board of Directors and Stockholders
HYUNDAI MOBIS Co., Ltd.:
We have audited the accompanying non-consolidated statements of financial position of HYUNDAI MOBIS Co., Ltd.
(the “Company”) as of December 31, 2010 and 2009, and the related non-consolidated statements of income,
appropriation of retained earnings, changes in equity and cash flows for the years then ended. These non-
consolidated financial statements are the responsibility of the Company's management. Our responsibility is to
express an opinion on these non-consolidated financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the Republic of Korea. Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the non-consolidated financial statements referred to above present fairly, in all material respects, the
financial position of the Company as of December 31, 2010 and 2009 and the results of its operations, appropriation of
its retained earnings, the changes in its equity and its cash flows for the years then ended in conformity with accounting
principles generally accepted in the Republic of Korea.
Without qualifying our opinion, we draw attention to the following:
As discussed in note 2 to the non-consolidated financial statements, accounting principles and auditing standards and
their application in practice vary among countries. The accompanying non-consolidated financial statements are not
intended to present the financial position, results of operations, changes in equity and cash flows in accordance with
accounting principles and practices generally accepted in countries other than the Republic of Korea. In addition, the
procedures and practices utilized in the Republic of Korea to audit such non-consolidated financial statements may
differ from those generally accepted and applied in other countries. Accordingly, this report and the accompanying
non-consolidated financial statements are for use by those knowledgeable about Korean accounting principles and
auditing standards and their application in practice.
Seoul, Korea
February 22, 2011
This report is effective as of February 22, 2011, the audit report date. 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 non-consolidated financial 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.
HYUNDAI MOBIS Co., Ltd.
Non-consolidated Statements of Financial Position
As of December 31, 2010 and 2009
3
(In millions of won)
Note 2010 2009
Assets
Cash and cash equivalents 16 W 2,051,820 777,001
Short-term financial instruments 250,000 10,000
Accounts and notes receivable - trade, less allowance for
doubtful accounts of W938 million in 2010 and W20,621
million in 2009
8,16 2,156,067 2,198,424
Accounts and notes receivable - other, less allowance for
doubtful accounts of W9,049 million in 2010 and W3,683
million in 2009
8,16 47,262 35,442
Inventories 4 714,235 636,663
Current financial derivative assets 17 7,157 3,169
Current deferred income tax assets 24 21,636 10,128
Other current assets 5 13,682 9,340
Total current assets 5,261,859 3,680,167
Long-term financial instruments 3 4,023 4,023
Available-for-sale securities 6 134,076 140,618
Equity method accounted investments 7 6,427,536 5,227,795
Property, plant and equipment, net 9,31 1,414,246 1,362,714
Intangible assets, net 10,31 513,796 667,966
Non-current financial derivative assets 17 3,924 1,824
Other non-current assets 11 104,377 104,552
Total non-current assets 8,601,978 7,509,492
Total assets W 13,863,837 11,189,659
See accompanying notes to non-consolidated financial statements.
HYUNDAI MOBIS Co., Ltd.
Non-consolidated Statements of Financial Position
As of December 31, 2010 and 2009
4
(In millions of won)
Note 2010 2009
Liabilities
Accounts and notes payable - trade 8,16 W 1,856,233 1,875,100
Accounts and notes payable - other 8,16 243,528 277,092
Short-term borrowings 13 - 110,000
Current portion of bonds, net of present value discount of W99
million in 2009 13 - 99,901
Advance from customers 64,060 41,372
Accrued expenses 53,677 45,943
Current provision for warranties 14 85,157 38,011
Income taxes payable 24 250,683 91,196
Current financial derivative liabilities 17 479 2,039
Other current liabilities 12 22,803 33,532
Total current liabilities 2,576,620 2,614,186
Bonds, net of discount of W725 million in 2010 and W627
million in 2009 13 299,275 199,373
Provision for retirement and severance benefits 15 69,078 52,037
Non-current provision for warranties 14 35,751 23,562
Non-current deferred income tax liabilities 24 705,230 447,917
Non-current financial derivative liabilities 17 2,561 2,456
Total non-current liabilities 1,111,895 725,345
Total liabilities 3,688,515 3,339,531
Stockholders’ equity
Common stock of W5,000 par value
Authorized – 275,000,000 shares
Issued and outstanding – 97,343,863 shares 18 490,969 490,969
Preferred stock 18 127 127
Capital surplus 18 1,361,124 1,342,035
Capital adjustments 19 (151,639) (165,054)
Accumulated other comprehensive income 27 209,339 185,667
Retained earnings 20 8,265,402 5,996,384
Total stockholders’ equity 10,175,322 7,850,128
Total stockholders’ equity and liabilities W 13,863,837 11,189,659
See accompanying notes to non-consolidated financial statements.
HYUNDAI MOBIS Co., Ltd.
Non-consolidated Statements of Income
For the years ended December 31, 2010 and 2009
5
(In millions of won, except earnings per share) Note 2010 2009
Sales 8,21,31 W 13,695,717 10,633,020
Cost of sales 8,22 10,518,898 8,097,949
Gross profit 3,176,819 2,535,071
Selling, general and administrative expenses 23,30 1,373,529 1,112,777
Operating income 31 1,803,290 1,422,294
Interest income 48,808 33,919
Interest expense (20,742) (25,056)
Loss on impairment of available-for-sale securities - (4,595)
Loss on sale of equity method accounted investment 7 (7,204) (40)
Gain on equity method accounted investments, net 7 1,227,197 641,543
Foreign currency translation loss, net (314) (153)
Foreign currency transaction loss, net (1,669) (9,358)
Loss on sale of property, plant and equipment, net (6,352) (11,077)
Loss on sale of accounts and notes receivable – trade (17,527) (25,619)
Realized gain of financial derivatives, net 4,112 53,577
Unrealized gain (loss) of financial derivatives, net 17 1,013 (783)
Reversal of allowance for doubtful accounts 18,435 -
Donations (16,076) (11,357)
Other, net 16,277 59
Other income 1,245,958 641,060
Income before income taxes 3,049,248 2,063,354
Income taxes 24 625,953 448,134
Net income W 2,423,295 1,615,220
Earnings per share
Basic earnings per share 25 W 25,413 17,812
See accompanying notes to non-consolidated financial statements.
HYUNDAI MOBIS Co., Ltd.
Non-consolidated Statements of Appropriation of Retained Earnings
For the years ended December 31, 2010 and 2009
6
Date of Appropriation for 2010: March 11, 2011
Date of Appropriation for 2009: March 12, 2010
(In millions of won) Note 2010 2009
Unappropriated retained earnings
Balance at beginning of year W 283 49
Changes in retained earnings of equity-method accounted
Investments, net of tax
(35,242) (53,660)
Net income 2,423,295 1,615,220
Balance at end of year before appropriation 2,388,336 1,561,609
Transfers from voluntary reserves
Reserve for research and human resource development 6,000 6,000
Unappropriated retained earnings available for
appropriation
2,394,336 1,567,609
Appropriation of retained earnings
Legal reserve 14,315 50,000
Dividends 26 143,140 119,035
Voluntary reserve 2,236,800 1,398,291
2,394,255 1,567,326
Unappropriated retained earnings to be carried over to
subsequent year
W 81 283
See accompanying notes to non-consolidated financial statements.
HYUNDAI MOBIS Co., Ltd.
Non-consolidated Statements of Changes in Equity
For the years ended December 31, 2010 and 2009
7
(In millions of won) Capital
stock Capital
surplus Capital
adjustments
Accumulated
other
comprehensive
income Retained
earnings
Total
stockholders’
equity
Balance at January 1, 2009 W 442,332 314,245 (114,901) 240,896 4,520,569 5,403,141
Dividends - - - - (85,745) (85,745)
Retained earnings after appropriation - - - - 4,434,824 5,317,396
Net income - - - - 1,615,220 1,615,220
Issuance of common stock through
merger 48,764 1,028,190 (29,411) - - 1,047,543
Gain on valuation of available-for-sale
securities, net of tax - - - 2,041 - 2,041
Loss on valuation of available-for-sale
securities, net of tax - - - 23,247 - 23,247
Gain on valuation of financial derivative
instruments, net of tax - - - 3,878 - 3,878
Loss on valuation of financial
derivatives, net of tax - - - (359) - (359)
Adjustments of equity in equity method
accounted investments, net of tax - (400) (20,742) (84,036) (53,660) (158,838)
Balance at December 31, 2009 W 491,096 1,342,035 (165,054) 185,667 5,996,384 7,850,128
Balance at January 1, 2010 W 491,096 1,342,035 (165,054) 185,667 5,996,384 7,850,128
Dividends - - - - (119,035) (119,035)
Retained earnings after appropriation - - - - 5,877,349 7,731,093
Net income - - - - 2,423,295 2,423,295
Disposal of treasury stock and others, net
of tax - 19,089 13,415 - - 32,504
Gain on valuation of available-for-sale
securities, net of tax - - - (711) - (711)
Loss on valuation of available-for-sale
securities, net of tax - - - (1,804) - (1,804)
Gain on valuation of financial
derivatives, net of tax - - - 5,834 - 5,834
Loss on valuation of financial
derivatives, net of tax - - - (2,310) - (2,310)
Adjustments of equity in equity method
accounted investments, net of tax - - - 22,663 (35,242) (12,579)
Balance at December 31, 2010 W 491,096 1,361,124 (151,639) 209,339 8,265,402 10,175,322
See accompanying notes to non-consolidated financial statements.
HYUNDAI MOBIS Co., Ltd.
Non-consolidated Statements of Cash Flows
For the years ended December 31, 2010 and 2009
8
(In millions of won) 2010 2009
Cash flows from operating activities
Net income W 2,423,295 1,615,220
Adjustments for:
Salaries 18,514 -
Accrual for retirement and severance benefits 60,718 32,448
Accrual for warranties 113,805 59,291
Depreciation 140,007 119,426
Amortization 163,627 111,005
Accrual for allowance for doubtful accounts - 4,443
Reversal of allowance for doubtful accounts (18,435) -
Interest expense 478 462
Loss on foreign currency translations, net 315 149
Loss on sale of accounts and notes receivable - trade 17,527 25,619
Loss on valuation of inventories 7,295 9,899
Loss on inventory obsolescence 12,685 28,072
Loss on impairment of available-for-sale securities - 4,595
Gain on equity method accounted investments, net (1,227,197) (641,543)
Loss on sale of equity method accounted investment 7,204 40
Loss on sale of property, plant and equipment, net 6,352 11,077
Loss (gain) on valuation of financial derivatives, net (1,013) 783
Others, net 11,015 1,890
(687,103) (232,344)
Changes in assets and liabilities:
Accounts and notes receivable - trade 42,118 (552,119)
Accounts and notes receivable - other (14,451) (3,887)
Accrued income (7,141) 3,389
Advance payments 381 (381)
Prepaid expenses 2,416 3,661
Financial derivative assets 1,426 (104)
Deferred income tax assets 2,471 8,702
Inventories (97,552) (100,096)
Accounts and notes payable - trade (18,630) 564,018
Accounts and notes payable - other (13,483) 65,717
Advances from customers 22,686 14,349
Accrued expenses 7,738 29,095
Provision for warranties (54,470) (30,288)
Income taxes payable 153,500 (182,529)
Deferred income tax liabilities 245,053 140,555
Financial derivative liabilities (3,343) (469)
Payments of retirement and severance benefits (18,082) (20,568)
Deposits for severance benefits (25,680) (10,061)
Dividend income 80,124 47,152
Others, net (10,644) 11,400
Net cash provided by operating activities W 2,030,629 1,370,412
See accompanying notes to non-consolidated financial statements.
HYUNDAI MOBIS Co., Ltd.
Non-consolidated Statements of Cash Flows
For the years ended December 31, 2010 and 2009
9
(In millions of won) 2010 2009
Cash flows from investing activities
Decrease(increase) in short-tem financial instruments, net W (240,000) 70,000
Proceeds from sale of property, plant and equipment 5,490 40,623
Proceeds from sale of intangible assets - 199
Proceeds from sale of available-for-sale securities 1,686 33,702
Proceeds from sale of equity method investment securities 33,054 4,797
Increase in deposits provided, net (8,350) (5,545)
Increase (decrease) in guarantee deposits, net 6,954 (8,229)
Proceeds from government subsidy 168 -
Purchase of available-for-sale securities (276) (38,455)
Purchase of equity method investment securities (108,047) (1,536,048)
Purchase of property, plant and equipment (208,686) (113,287)
Purchase of intangible assets (8,759) (22,208)
Increase from merger - 6,099
Net cash used in investing activities (526,766) (1,568,352)
Cash flows from financing activities
Proceeds from short-term borrowings - 340,000
Proceeds from bonds 99,523 199,117
Exercise of stock options 468 -
Purchase of treasury stock - (3,471)
Repayment of short-term borrowings (110,000) (366,000)
Repayment of current portion of long-term debt (100,000) (180,000)
Dividends paid (119,035) (85,745)
Net cash used in financing activities (229,044) (96,099)
Net increase (decrease) in cash and cash equivalents 1,274,819 (294,039)
Cash and cash equivalents at beginning of year 777,001 1,071,040
Cash and cash equivalents at end of year W 2,051,820 777,001
See accompanying notes to non-consolidated financial statements
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
10
1. Organization and Description of Business
HYUNDAI MOBIS Co., Ltd. (the “Company”) was incorporated on June 25, 1977, under the laws of the Republic of
Korea, to engage in the auto parts business, mainly manufacturing parts and modules, for car production, after-sales
services, and others. The shares of the Company have been listed on the Korea Stock Exchange since 1989.
Under its Articles of Incorporation, the Company is authorized to issue to investors, other than current shareholders,
convertible bonds and bonds with warrants with face values of up to W1,000,000 million and W200,000 million,
respectively. The Company is also authorized, subject to the Board of Directors‟ approval, to issue shares of
common or preferred stock to investors other than current shareholders for issuance of depository receipts, attraction
of foreign capital, general public subscription, and shares to employee stock ownership associations.
Also, the Company has a stock option plan that provides for the granting of stock purchase options to employees or
directors who have contributed or are expected to contribute to the Company within fifteen percent of issued shares,
subject to the extraordinary approval of shareholders during a general shareholders‟ meeting or within one percent of
issued shares, subject to the Board of Directors‟ approval. There were no stock options granted as of and for the
years ended December 31, 2010 and 2009.
Under its Articles of Incorporation, the Company is authorized to issue shares of non-voting preferred stock up to 25
million shares. In case the Company is not able to pay the agreed additional dividends for preferred stock, the
preferred shareholders are given the voting rights from the date of the general shareholders‟ meeting which approves
the restraint of dividends to the preferred stock, to the date of the general shareholders‟ meeting which approves the
resumption of the dividends to the preferred stock. As of December 31, 2010 and 2009, the numbers of the issued
preferred stocks of the Company totaled 25,458 shares. The Company is authorized, subject to the Board of
Directors‟ approval, to retire treasury stock up to the maximum amount of certain undistributed earnings. Until
December 31, 2010, 850,000 shares of common stock have been retired (Note 18).
The Company‟s common stockholders as of December 31, 2010 and 2009 are as follows:
2010 2009
Stockholders
Number of
Shares
Percentage of
ownership
Number of
Shares
Percentage of
ownership
KIA Motors Corporation 16,427,074 16.88% 16,427,074 16.88%
Mong-Ku, Chung 6,778,966 6.96% 6,778,966 6.96%
Hyundai Steel Company 5,504,846 5.66% 5,504,846 5.66%
Glovis Co., Ltd. 656,293 0.67% 656,293 0.67%
Treasury stock 1,943,319 2.00% 2,142,450 2.20%
Others 66,033,365 67.83% 65,834,234 67.63%
97,343,863 100.00% 97,343,863 100.00%
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
11
2. Basis of Presenting Financial Statements and Summary of Significant Accounting Policies
(a) Basis of Presenting Financial Statements
The Company maintains its accounting records in Korean won and prepares statutory non-consolidated financial
statements in the Korean language in conformity with accounting principles generally accepted in the Republic
of Korea. Certain accounting principles applied by the Company that conform with financial accounting
standards and accounting principles in the Republic of Korea may not conform with generally accepted
accounting principles in other countries. Accordingly, these financial statements are intended solely for use by
those who are informed about Korean accounting principles and practices. The accompanying non-consolidated
financial statements have been condensed, restructured and translated into English from the Korean language
non-consolidated financial statements.
Certain information included in the Korean language non-consolidated financial statements, but not required for
a fair presentation of the Company's financial position, results of operations, cash flows or changes in equity is
not presented in the accompanying non-consolidated financial statements.
The Company prepares the non-consolidated financial statements in accordance with generally accepted
accounting principles in the Republic of Korea, and the Company applied the same accounting policies that were
adopted in the previous year‟s non-consolidated financial statements.
(b) Revenue Recognition
Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of
returns and allowances, trade discounts and volume rebates. Revenue is recognized when the significant risks
and rewards of ownership have been transferred to the buyer, recovery of the consideration is probable, the
associated costs and possible return of goods can be estimated reliably, and there is no continuing management
involvement with the goods. Consequently, revenue from the sale of merchandise is recognized at the time of
delivery and revenue from the sale of finished goods is recognized upon completion of inspection by customers.
(c) Allowance for Doubtful Accounts
Allowance for doubtful accounts is estimated based on past experience of collection and future collectability and
presented as a deduction from related receivables.
(d) Trade Accounts and Notes Receivable Assigned or Discounted
When the Company sells or discounts certain accounts or notes receivable to others, the company treats the
transaction as a sale of the receivables which calculated by the differences between carrying amount and the
consideration received, if the contractual rights and obligations related to the receivables are substantially
transferred to the buyers.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
12
2. Basis of Presenting Financial Statements and Summary of Significant Accounting Policies, Continued
(e) Inventories
Inventories are stated at the lower of cost or net realizable value. Net realizable value is the estimated selling
price in the ordinary course of business, less the estimated selling costs. The cost of inventories is determined
by the monthly-calculated weighted-average method for merchandise, finished goods, work-in-progress, raw
material and supplies, and by the moving-average method for auto parts for after sales service, and by the
specific identification method for materials in transit. Amounts of inventory written down to net realizable
value due to losses occurring in the normal course of business are recognized as cost of goods sold and are
deducted from the carrying value of inventories.
(f) Investments in Securities (Excluding Investments in Associates, Subsidiaries and Joint Ventures)
Upon acquisition, the Company classifies debt and equity securities (excluding investments in subsidiaries,
associates and joint ventures) into the following categories: held-to-maturity, available-for-sale or trading
securities.
Investments in debt securities where the Company has the positive intent and ability to hold to maturity are
classified as held-to-maturity. Securities that are acquired principally for the purpose of selling in the short term
are classified as trading securities. Investments not classified as either held-to-maturity or trading securities are
classified as available-for-sale securities.
Investments in securities (excluding investments in subsidiaries, associates and joint ventures) are initially
recognized at cost.
Trading securities are subsequently carried at fair value. Gains and losses arising from changes in the fair value
of trading securities are included in the income statement in the period in which they arise. Available-for-sale
securities are subsequently carried at fair value. Gains and losses arising from changes in the fair value of
available-for-sale securities are recognized as accumulated other comprehensive income, net of tax, directly in
equity. Investments in available-for-sale securities that do not have readily determinable fair values are
recognized at cost less impairment, if any. Held-to-maturity investments are carried at amortized cost with
interest income and expense recognized in the income statement using the effective interest rate method.
The fair value of marketable securities is determined using quoted market prices as of the period end. Non-
marketable debt securities are fair valued based on the standard trading price suggested by the investment
management companies.
The Company reviews investments in securities whenever events or changes in circumstances indicate that the
carrying amount of the investments may not be recoverable. Impairment losses are recognized when the
reasonably estimated recoverable amounts are less than the carrying amount and it is not obviously evidenced
that impairment is unnecessary.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
13
2. Basis of Presenting Financial Statements and Summary of Significant Accounting Policies, Continued
(f) Investments in Securities (Excluding Investments in Associates, Subsidiaries and Joint Ventures),
Continued
Trading securities are presented as current assets. Available-for-sale securities, which mature within one year
from the balance sheet date or where the likelihood of disposal within one year from the balance sheet date is
probable, are presented as current assets. Held-to-maturity securities, which mature within one year from the
balance sheet date, are presented as current assets. All other available-for-sale securities and held-to-maturity
securities are presented as long-term investments.
(g) Equity Method Accounted Investments in Associates and Subsidiaries
Associates are entities on which the Company and its subsidiaries have the ability to significantly influence the
financial and operating policies. It is presumed to have significant influence if the Company holds directly or
indirectly 20 percent or more of the voting power unless it can be clearly demonstrated that this is not the case.
Subsidiaries are entities controlled by the Company.
Investments in associates and subsidiaries are accounted for using the equity method of accounting and are
initially recognized at cost. Under the equity method, the Company records changes in its proportionate
ownership in the book value of the associates and subsidiaries in current operations, as capital adjustments, as
adjustments to retained earnings or adjustments to equity in earnings or losses of associates and subsidiaries,
depending on the nature of the underlying change in the book value of the investee. When the Company‟s share
of losses in investees equals or exceeds its interest in the investees, including preferred stock or other long term
loans and receivables issued by the investees, the Company does not recognize further losses, unless it has
obligations or made payments on behalf of the investees. Gains and losses on transactions between the
Company and its investees are eliminated to the extent of the Company‟s interest in each investee.
The excess of the acquisition cost of an investment in an investee over the Company‟s interest of the fair value of
the identifiable net assets acquired is amortized using the straight-line method over its estimated useful life.
When acquisition cost of investments in an investee is less than the Company‟s interest on the fair value of the
identifiable net assets acquired, such difference is recognized using the straight-line method as a gain over the
weighted average period of useful lives of the depreciable and amortizable non-monetary assets. The remainder
over the fair value of identifiable non-monetary assets is recognized as a gain in the period of purchase. The
amount of unamortizable non-monetary assets is recognized as a gain in the period of disposal. Also, the
Company‟s interest on the difference between fair value and carrying value of identifiable assets and liabilities of
an investee, at the time of acquisition, is depreciated or reversed in accordance with accounting policies of related
assets or liabilities of an investee.
Foreign currency financial statements of associates and subsidiaries are translated into Korean won using the
exchange rates in effect as of the reporting period for assets and liabilities (the exchange rates on the acquisition
date for capital accounts), and annual average exchange rates for income and expenses. Cumulated translation
gains or losses are included in accumulated other comprehensive income, a component of stockholders‟ equity.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
14
2. Basis of Presenting Financial Statements and Summary of Significant Accounting Policies, Continued
(g) Equity Method Accounted Investments in Associates and Subsidiaries, Continued
The Company‟s proportionate unrealized profit arising from sales by the Company to associates and subsidiaries,
sales by the associates and subsidiaries to the Company or sales between associates and subsidiaries are
eliminated to the extent of the Company‟s ownership in each associate or subsidiary.
If the investee is a subsidiary, net income and net assets of the Company‟s non-consolidated financial statements
should agree with the Company‟s share in the net income and net assets of the consolidated financial statements,
except when the Company discontinues the application of the equity method due to its investment in a subsidiary
being reduced to zero.
(h) Joint Venture
If the Company is a member of Jointly Controlled Entities, the Company accounts for its interest in a jointly
controlled entity using the equity method.
(i) Property, Plant and Equipment
Property, plant and equipment are stated at cost. Assets acquired through investment in kind or donations are
recorded at their fair value upon acquisition. For assets acquired in exchange for a non-monetary asset with
different function, the fair value of the asset given up is used to measure the cost of the asset received unless the
fair value of the asset received is more clearly evident. For assets acquired in exchange for a non-monetary
asset with similar function, the carrying amount of the asset given up is used to measure the cost of the asset.
Significant additions or improvements extending the useful life of assets are capitalized. Normal maintenance
and repairs are charged to expense as incurred.
Depreciation is computed by the straight-line method over the useful lives of the respective assets as follows:
Useful lives (years)
Buildings 10 ~ 30
Structures 10 ~ 30
Machinery and equipment 5 ~ 15
Vehicles 2 ~ 15
Tools 2 ~ 5
Furniture and fixtures 2 ~ 5
The Company recognizes interest costs and other financial charges on borrowings associated with the production,
Purchase or construction of property, plant and equipment as an expense in the period in which they are incurred.
2. Basis of Presenting Financial Statements and Summary of Significant Accounting Policies, Continued
(i) Property, Plant and Equipment, Continued
The Company reviews property, plant and equipment for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss is
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
15
recognized when the expected estimated undiscounted future net cash flows from the use of the asset and its
eventual disposal are less than its carrying amount.
(j) Goodwill and Negative Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair value of the identifiable net assets
acquired. Goodwill is amortized on a straight-line basis over its estimated useful life of 5 to 10 years. Where
it is no longer probable that goodwill will be recovered from the expected future economic benefits generated by
the acquisition, it is expensed immediately.
Negative goodwill is the excess of the fair value of identifiable net assets acquired in an acquisition over the
acquisition cost. Negative goodwill is presented as a reduction in intangible assets. The amount of negative
goodwill up to the fair value of identifiable non-monetary assets is recognized using the straight-line method as a
gain over the weighted average period of useful lives of the depreciable and amortizable non-monetary assets.
The remainder over the fair value of identifiable non-monetary assets is recognized as a gain in the period of
acquisition. Negative goodwill related to future losses and expenses that have been specifically identified in the
purchase agreement, is recognized as income as these are actually incurred.
(k) Intangible Assets
Intangible assets are stated at cost less accumulated amortization and impairment losses, if any. Impairment
losses are determined as the amount required to reduce the carrying amount of an intangible asset to its
recoverable amount.
The criteria for determining whether an incurred cost qualifies as an intangible asset and the periods of
amortization for each classification of intangible asset are described below.
(i) Research and Development Costs
To assess whether an internally generated intangible asset meets the criteria for recognition, the Company
classifies the expense generation process into a research phase and a development phase. All costs incurred
during the research phase are expensed as incurred. Costs incurred during the development phase are
recognized as assets only if the following criteria are met for recognition in Statements of Korean
Accounting Standards (“SKAS”) No. 3 Intangible Assets: (1) completion of the intangible asset is
technically feasible so that it will be available for use or sale; (2) the Company has the intention and ability
to complete the intangible asset and use or sell it; (3) there is evidence that the intangible asset will generate
probable future economic benefit; (4) the Company has adequate technical, financial and other resources to
complete the development of the intangible asset and the intangible asset will be available; and (5) the
expenditures attributable to the intangible asset during its development can be reliably determined.
2. Basis of Presenting Financial Statements and Summary of Significant Accounting Policies, Continued
(k) Intangible Assets, Continued
If the costs incurred fail to satisfy these criteria, they are recorded as expenses as incurred. Where
development costs satisfy the criteria, they are capitalized and amortized on a straight-line basis over 5 years.
The expenditure capitalized includes the cost of materials, direct labor and an appropriate proportion of
overheads.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
16
(ii) Other Intangible Assets
Other intangible assets, which consist of industrial property rights, software and other intangible assets, are
amortized using the straight-line method over their respective estimated useful lives as follows:
Useful lives (years)
Industrial rights 2 ~ 10
Software 2 ~ 5
Other intangible assets 6
The Company reviews intangible assets for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. An impairment loss is recognized when the
expected estimated undiscounted future net cash flows from the use of the asset and its eventual disposal are less
than its carrying amount.
(l) Government Grant Received for Capital Expenditure
Government grant received from third parties for capital expenditure are presented as a reduction of the
acquisition cost of the acquired assets and, accordingly, reduce depreciation expense related to the acquired assets
over their useful lives.
On the other hand, in case where the Company receives government grants and is obligated to repay certain
portion of government grant received upon their success of development activities, development expenditures are
accounted for guarantee deposits liabilities at the initial date of contract. With respect to government grant with
no obligation to repay, government grant is accounted for other income and expense in current year based on the
proportionate of expenditure on research and development.
(m) Cost of issuance of stock and debenture
Issuance costs for stock are deducted from capital in excess of par value and debenture issuance costs are
included in bond discounts or premium on bonds.
(n) Discount (Premium) on Debentures
Discount (premium) on debentures issued, which represents the difference between the face value and issuance
price of debentures, is amortized (accreted) using the effective interest rate method over the life of the debentures.
The amount amortized (accreted) is included in interest expense.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
17
2. Basis of Presenting Financial Statements and Summary of Significant Accounting Policies, Continued
(o) Retirement and Severance Benefits
Employees who have been with the Company for more than one year are entitled to lump-sum payments based
on salary rates and length of service at the time they leave the Company. The Company's estimated liability
under the plan, which would be payable if all employees left at the end of the reporting period, is accrued in the
accompanying non-consolidated statements of financial position. A portion of the liability is covered by an
employees‟ severance benefits trust where the employees have a vested interest in the deposit with the insurance
company or the bank in trust. The deposit for severance benefits held in trust is, therefore, reflected in the
accompanying non-consolidated statements of financial position as a reduction of the liability for retirement and
severance benefits.
Through March 1999, under the National Pension Scheme of Korea, the Company transferred a certain portion of
retirement allowances for employees to the National Pension Fund. The amount transferred reduced the
retirement and severance benefit amount to be paid to the employees when they leave the Company and is
accordingly reflected in the accompanying non-consolidated financial statements as a reduction of the retirement
and severance benefits liability. However, due to regulation effective April 1999, such transfers to the National
Pension Fund are no longer required.
(p) Foreign Currency Translation
Monetary assets and liabilities denominated in foreign currencies are translated into Korean won at the foreign
exchange rate on the end of the reporting period, with the resulting gains or losses recognized in the income
statement. Non-monetary assets and liabilities denominated in foreign currencies, which are stated at historical
cost, are translated into Korean won at the foreign exchange rate on the date of the transaction.
Foreign currency assets and liabilities of foreign-based operations are translated at the rate of exchange at the end
of the reporting period. Foreign currency amounts in the statement of income are translated using an average
rate and foreign currency balances in the capital account are translated using the historical rate.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
18
2. Basis of Presenting Financial Statements and Summary of Significant Accounting Policies, Continued
(q) Derivatives and Hedge Accounting
The Company holds financial derivatives to hedge its foreign currency risk exposures. Embedded derivatives
are separated from the host contract and accounted for separately if the economic characteristics and risks of the
host contract and the embedded derivative are not closely related, a separate instrument with the same terms as
the embedded derivative would meet the definition of a derivative and the hybrid instrument, which is composed
by embedded derivatives and host contract, is not measured at fair value with changes in fair value recognized in
profit or loss.
Where a derivative, which meets certain criteria, is used for hedging the exposure to the variability of the future
cash flows of a forecasted transaction it is designated as a cash flow hedge.
The Company documents, at the inception of the transaction, the relationship between hedging instruments and
hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions.
The Company also documents its assessment, both at hedge inception and on an ongoing basis, of whether the
derivatives that are used in hedging transactions are highly effective in offsetting the changes in cash flows of
hedged items.
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow
hedges are recognized in equity. The gain or loss relating to any ineffective portion is recognized immediately
in the statement of income. Amounts accumulated in equity are recycled to the income statement in the periods
in which the hedged item will affect income or expense. When a hedging instrument expires or is sold, or when
a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at the
time remains in equity and is recognized when the forecast transaction is ultimately recognized in the statement
of income. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was
reported in equity is immediately transferred to the statement of income.
(r) Provisions, Contingent Assets and Contingent Liabilities
Provisions are recognized when all of the following are met: (1) an entity has a present obligation as a result of
the past event, (2) it is probable that an outflow of resources embodying economic benefits will be required to
settle the obligation, and (3) a reliable estimate can be made of the amount of the obligation.
Where the expenditure required to settle a provision is expected to be reimbursed by another party, the
reimbursement is recognized as a separate asset when, and only when, it is virtually certain that reimbursement
will be received if the Company settles the obligation. The expense generated by the provision is presented net
of the amount of expected reimbursement.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
19
2. Basis of Presenting Financial Statements and Summary of Significant Accounting Policies, Continued
(s) Income Taxes
Income tax on the income or loss for the year comprises current and deferred tax. Income tax is recognized in
the statement of income except to the extent that it relates to items recognized directly in equity, in which case it
is recognized in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted.
Deferred tax is provided using the asset and liability method, providing for temporary differences between the
carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for tax purposes.
The amount of deferred tax provided is based on the expected manner of realization or settlement of the carrying
amount of assets and liabilities, using tax rates enacted or substantively enacted at the end of the reporting period.
A deferred tax asset is recognized only to the extent that it is probable that future taxable income will be available
against which the unused tax losses and credits can be utilized. Deferred tax assets are reduced to the extent
that it is no longer probable that the related tax benefit will be realized.
Deferred tax assets and liabilities are classified as current or non-current based on the classification of the related
asset or liability for financial reporting or the expected reversal date of the temporary difference for those with no
related asset or liability such as loss carryforwards and tax credit carryforwards. The deferred tax amounts are
presented as a net current asset or liability and a net non-current asset or liability.
Changes in deferred taxes due to a change in the tax rate except for those related to items initially recognized
outside profit or loss (either in other comprehensive income or directly in equity) are recognized as income in the
current year.
(t) Use of Estimates
The preparation of non-consolidated financial statements in accordance with accounting principles generally
accepted in the Republic of Korea requires management to make estimates and assumptions that affect the
amounts reported in the non-consolidated financial statements and related notes to non-consolidated financial
statements. Actual results could differ from those estimates.
(u) Reclassification
Certain reclassifications have been made to the prior year non-consolidated financial statements to conform to
the 2010 presentation. Those reclassifications did not have any impact on the reported net income and net asset
as of and for the year ended December 31, 2009.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
20
3. Restricted Deposits
Deposits which are restricted in use as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Long-term deposits W 4,023 4,023
4. Inventories
Inventories as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Merchandise W 474,404 399,905
Finished goods 22,968 23,663
Work-in-progress 60,732 41,554
Raw materials 116,048 102,180
Supplies 10,125 9,296
Materials-in-transit 41,276 61,023
Outsourcing 11,408 14,473
Less allowance for valuation loss (22,726) (15,431)
W 714,235 636,663
5. Other Current Assets
Other current assets as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Accrued income W 8,241 1,101
Advance payments - 381
Prepaid expenses 5,441 7,858
W 13,682 9,340
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
21
6. Available-for-sale Securities
Available-for-sale securities consist of marketable securities recorded at fair value and non-marketable securities
recorded at cost.
Available-for-sale securities as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Marketable securities W 115,894 118,666
Non-marketable securities 18,182 21,952
W 134,076 140,618
(a) Marketable securities recorded at fair value
Marketable securities recorded at fair value as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won, except number of shares and percentage of ownership)
2010 2009
Number of
shares
Percentage
of
ownership
Acquisition
cost Book Value
Acquisition
cost Book Value
Hyundai Development Co.,
Ltd.
437,500 0.58% W 8,775 14,875 8,775 16,516
HMC Investment Securities Co.,
Ltd.
4,623,587 15.76% 114,045 98,020 114,045 100,332
Hyundai Merchant Marine Co.,
Ltd.
61,642 0.04% 1,402 2,376 1,402 1,646
Ssangyong Motor Co., Ltd. 60,127 0.16% 451 506 - -
Enova Systems, Inc. 80,000 0.39% 90 117 90 172
W 124,763 115,894 124,312 118,666
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
22
6. Available-for-sale Securities, Continued
(b) Non-marketable securities recorded at cost
Non-marketable securities recorded at cost as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won, except number of shares and percentage of ownership)
2010 2009
Number of
shares
Percentage
of
ownership
Acquisition
cost Book Value
Acquisition
cost Book Value
China Millennium Corporation I,
Ltd.
- 10.10% W 2,099 2,099 2,099 2,099
China Millennium Corporation Ⅱ,
Ltd.
- 10.10% 2,089 2,089 2,089 2,089
China Millennium Corporation Ⅲ,
Ltd.
- 10.10% 4,873 4,873 4,873 4,873
Guangdong Hyundai Mobis - - - - 8,374 2,756
Gong-ju Environment Co., Ltd. - - - - 1,124 1,124
Haevichi Hotel and Resort Co.,
Ltd. (formerly, Haevichi Resort
Co., Ltd.)
310,000 10.00% 2,132 - 2,132 -
Global Information Technology
Co., Ltd.
900,000 9.76% 450 450 450 450
MTComm Co., Ltd. 26,668 17.58% 200 - 200 -
The Sign Co., Ltd. 417,000 10.69% 2,085 - 2,085 -
GTWeb Korea, Inc. 2,659 5.32% 835 - 835 -
Digital & Analog Co., Ltd. - - - - 22 9
Korea Auto Industries Coop.
Association
83 1.22% 15 15 15 15
The Korea Economic Daily 531,090 2.84% 2,656 2,656 2,656 2,656
Partecs Company., Ltd. 1,040,000 13.00% 5,200 5,200 5,200 5,200
ZF SACHS KOREA Co., Ltd. 908,960 8.55% 635 635 635 635
Daewoo Motor Co., Ltd. 2,569 - - - - -
Haevichi Country Club Ltd. 450,000 15.00% 2,274 - 2,274 -
Daewoo Automobiles trust
instrument
- - 44 44 44 44
Mediazen Co., Ltd. 209,339 9.83% 2 2 2 2
Easy Move Co., Ltd. 11,897 8.20% 119 119 - -
SB Telcom Co., Ltd. 100,965 0.79% - - - -
W 25,708 18,182 35,109 21,952
These non-marketable securities are recorded at cost less impairment since their fair value is not readily determinable.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
23
7. Equity Method Accounted Investments
(a) Investment in companies accounted for using the equity method as of December 31, 2010 is summarized as
follows:
(In millions of won, except percentage of ownership)
Company
Percentage
of
ownership
Purchase
Cost Net assets
Balance at
December 31,
2010
Hyundai Motor Company(*1) 20.78% W 2,139,997 4,389,761 4,677,298
Autoever Systems Corporation 20.00% 1,000 26,598 26,598
ZF Lemfoerder Chassis Technology Korea
Co., Ltd.
27.34% 2,668 4,627 4,579
Hyundai Amco Co., Ltd.(*2) 19.99% 10,067 83,361 83,361
IHL Co., Ltd.(*3) 90.00% 25,322 27,801 27,147
Hyundai Powertech Co., Ltd. 24.85% 114,848 152,317 146,843
HMC Investment Union 38.89% 21,000 21,153 21,153
M&Soft 25.67% 8,817 13,180 13,167
HL Green Power Inc.(*4) 51.00% 14,790 13,523 13,523
Hyundai Motor (Shanghai) Co., Ltd. 100.00% 4,571 38,407 30,261
Shanghai Hyundai Mobis Automotive Parts
Co., Ltd.
87.50% 11,956 176,765 173,808
Jiangsu Mobis Automotive Parts Co., Ltd. 100.00% 22,927 153,454 135,538
Beijing Hyundai Mobis Automotive Parts Co.,
Ltd.
100.00% 12,002 313,240 280,085
Beijing Mobis Transmission Co., Ltd. 31.96% 30,365 69,465 67,556
Beijing Mobis Chonche Automotive Parts Co.,
Ltd.
60.00% 5,070 20,898 19,970
Beijing Hyundai Mobis Parts Co., Ltd. 50.00% 4,089 31,919 28,272
Hyundai Motor Group (China) Ltd. 20.00% 6,138 41,112 41,112
Wuxi Mobis Automotive Parts Co., Ltd. 33.75% 11,727 30,435 27,561
Mobis Parts Jiangsu Yueda Trading Co.,
Ltd.
50.00% 2,632 15,265 14,157
Tianjin Mobis Automotive Parts Co., Ltd. 100.00% 14,903 54,013 42,050
Hyundai Mobis (Hongkong) Co., Limited 100.00% 3 3 3
Mobis Parts Europe N.V.(*5) 100.00% 85,515 101,886 -
Mobis Slovakia s.r.o. 100.00% 107,095 57,786 50,115
Mobis Automotive Czech s.r.o. 100.00% 24,573 41,427 33,089
Mobis Module CIS, LLC 99.00% 39,545 29,890 28,737
Mobis America Inc. 100.00% 258,448 261,810 239,244
America Auto Parts Inc. 100.00% 14,736 33,934 33,704
Mobis Brasil Fabricacao De Auto Pecas
Ltda(*6)
100.00% 16,539 16,718 16,718
Mobis Parts Middle East FZE(*5) 100.00% 3,902 44,989 -
Mobis India, Ltd.(*7) 100.00% 58,538 129,804 118,166
Mobis India Research and Development
Private Limited(*8)(formerly, Hyundai
Autonet India Engineering PVT Limited)
100.00% 925 1,847 925
Mobis Parts Australia PTY., Ltd. 100.00% 12,502 33,997 32,796
3,087,210
6,431,385
6,427,536 W
7. Equity Method Accounted Investments, Continued
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
24
(*1) The fair value of Hyundai Motor Company, listed in KSE (Korea Stock Exchange), as of December 31,
2010 is W7,943,181 million.
(*2) The Company‟s percentage of ownership in Hyundai Amco Co., Ltd. is less than 20%. However, the
equity method was applied in accordance with Statements of Korea Accounting Standards (“SKAS”) No.
15 Equity Method because the Company has significant influence on the investee.
(*3) The Company sold 10% share of IHL Co., Ltd. on July 27, 2010.
(*4) HL Green Power Inc. was established on January 14, 2010 in accordance with the joint venture agreement
between the Company and LG Chem Ltd.
(*5) The Company discontinued the application of the equity method as the book values of the investments were
reduced to zero.
(*6) The Company acquired its entire share of Mobis Parts Brazil Intermediancao de Negocios Ltda, previously
a 100% owned subsidiary of Mobis Parts America, LLC on November 4, 2010. The entity changed its name
to Mobis Brasil Fabricacao De Auto Pecas Ltda.
(*7) Mobis India, Ltd. merged with Hyundai Autonet India PVT., Ltd. on January 1, 2010.
(*8) Investments in subsidiaries and associates whose total assets as of the previous year-end are less than
W10,000 million are stated at cost in accordance with accounting principles generally accepted in the
Republic of Korea.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
25
7. Equity Method Accounted Investments, Continued
Investment in companies accounted for using the equity method as of December 31, 2009 is summarized as
follows:
(In millions of won, except percentage of ownership)
Company
Percentage
of
ownership
Purchase
Cost Net assets
Balance at
December 31,
2009
Hyundai Motor Company(*1) 20.78% W 2,139,997 3,509,170 3,880,191
Autoever Systems Corporation 20.00% 1,000 21,425 21,425
ZF Lemfoerder Chassis Technology Korea Co.,
Ltd.
27.34% 2,668 4,570 4,492
Hyundai Amco Co., Ltd.(*2) 19.99% 10,067 80,843 80,843
IHL Co., Ltd. 100.00% 28,136 37,135 36,903
Hyundai Commercial Co., Ltd. 20.00% 20,000 21,979 21,979
Hyundai Powertech Co., Ltd. 24.85% 90,000 115,015 107,155
HMC Investment Union 20.00% 6,000 6,202 6,202
M&Soft 25.67% 8,817 10,498 10,621
Hyundai Motor (Shanghai) Co., Ltd. 100.00% 4,571 25,555 18,228
Shanghai Hyundai Mobis Automotive Parts Co.,
Ltd.
87.50% 11,956 121,310 120,009
Jiangsu Mobis Automotive Parts Co., Ltd. 100.00% 22,927 106,062 96,915
Beijing Hyundai Mobis Automotive Parts Co.,
Ltd.
100.00% 12,002 250,563 223,061
Beijing Mobis Transmission Co., Ltd. 31.96% 30,365 63,442 61,433
Beijing Mobis Chonche Automotive Parts Co.,
Ltd.
60.00% 5,070 17,960 17,304
Beijing Hyundai Mobis Parts Co., Ltd. 50.00% 4,089 22,692 20,983
Hyundai Motor Group (China) Ltd. 20.00% 6,138 27,747 27,747
Wuxi Mobis Automotive Parts Co., Ltd. 33.75% 11,727 26,086 24,814
Mobis Parts Jiangsu Yueda Trading Co., Ltd. 50.00% 2,632 11,159 9,849
Tianjin Mobis Automotive Parts Co., Ltd. 100.00% 14,903 32,321 20,600
Hyundai Mobis (Hongkong) Co., Limited(*4) 99.99% 3 (77) -
Mobis Parts Europe N.V. (*4) 100.00% 54,364 80,778 -
Mobis Slovakia s.r.o. 100.00% 107,995 36,304 33,213
Mobis Automotive Czech s.r.o. 100.00% 24,573 26,493 20,503
Mobis Module CIS, LLC(*3) 99.00% 33,808 29,542 33,808
Mobis America Inc. 100.00% 258,767 211,519 195,332
America Auto Parts Inc. 100.00% 14,736 19,625 19,637
Mobis Parts Middle East FZE(*4) 100.00% 3,902 29,177 -
Mobis India, Ltd. 100.00% 54,133 94,223 84,059
Hyundai Autonet India PVT., Ltd. 100.00% 3,813 6,146 4,405
Hyundai Autonet India Engineering PVT
Limited(*3)
100.00% 925 1,519 925
Mobis Parts Australia PTY., Ltd. 100.00% 12,502 26,146 25,159
W 3,002,586 5,073,129 5,227,795
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
26
7. Equity Method Accounted Investments, Continued
(*1) The fair value of Hyundai Motor Company, listed in KSE (Korea Stock Exchange), as of December 31,
2009 is W5,539,625 million.
(*2) The Company‟s percentage of ownership in Hyundai Amco Co., Ltd. is less than 20%. However, the
equity method was applied in accordance with Statements of Korea Accounting Standards (“SKAS”) No.
15 Equity Method because the Company has significant influence on the investee.
(*3) Investments in subsidiaries and associates whose total assets as of the previous year-end are less than
W10,000 million are stated at cost in accordance with accounting principles generally accepted in the
Republic of Korea.
(*4) The Company discontinued the application of the equity method as the book values of the investments were
reduced to zero.
.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
27
7. Equity Method Accounted Investments, Continued
(b) Changes in goodwill for equity method accounted investments for the year ended December 31, 2010 were as
follows:
(In millions of won)
Company
Balance at
Jan. 1, 2010
Increase
Amortized
amount
Balance at Dec.
31, 2010
Hyundai Motor Company W 372,286 - 83,095 289,191
Hyundai Powertech Co., Ltd. (7,388) - (2,687) (4,701)
M&Soft 193 - 43 150
Beijing Mobis Transmission Co.,
Ltd. (225) - (150) (75)
Tianjin Mobis Automotive Parts
Co., Ltd. (8,439) - (1,875) (6,564)
Mobis Slovakia s.r.o. 866 - 193 673
Mobis America Inc. (206) - (46) (160)
Mobis India, Ltd. (661) - (147) (514)
W 356,426 - 78,426 278,000
Changes in goodwill for equity method accounted investments for the year ended December 31, 2009 were as
follows:
(In millions of won)
Company
Balance at
Jan. 1, 2009
Increase
Amortized
amount
Balance at Dec.
31, 2009
Hyundai Motor Company W 14,898 383,453 26,065 372,286
Hyundai Amco Co., Ltd. (1,598) - (1,598) -
Hyundai Powertech Co., Ltd. (10,075) - (2,687) (7,388)
M&Soft - 214 21 193
Beijing Mobis Transmission Co.,
Ltd. (375) - (150) (225)
Beijing Mobis Chonche
Automotive Parts Co., Ltd. (157) - (157) -
Wuxi Mobis Automotive Parts Co.,
Ltd. 65 - 65 -
Tianjin Mobis Automotive Parts
Co., Ltd. - (9,376) (937) (8,439)
Mobis Slovakia s.r.o. - 962 96 866
Mobis America Inc. - (229) (23) (206)
Hyundai Autonet India PVT., Ltd. - (734) (73) (661)
2,758
374,290
20,622
356,426 W
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
28
7. Equity Method Accounted Investments, Continued
(c) Details of eliminated unrealized gains (losses) from inter-company transactions as of December 31, 2010 and
2009 are summarized as follows:
(In millions of won)
Company 2010 2009
Hyundai Motor Company W 1,654 1,265
ZF Lemfoerder Chassis Technology Korea Co., Ltd. 48 78
IHL Co., Ltd. 654 232
Hyundai Powertech Co., Ltd. 773 472
M&Soft 163 70
Hyundai Motor (Shanghai) Co., Ltd. 8,146 7,327
Shanghai Hyundai Mobis Automotive Parts Co., Ltd. 2,957 1,301
Jiangsu Mobis Automotive Parts Co., Ltd. 17,916 9,147
Beijing Hyundai Mobis Automotive Parts Co., Ltd. 33,155 27,502
Beijing Mobis Transmission Co., Ltd. 1,834 1,784
Beijing Mobis Chonche Automotive Parts Co., Ltd. 928 656
Beijing Hyundai Mobis Parts Co., Ltd. 3,647 1,709
Wuxi Mobis Automotive Parts Co., Ltd. 2,874 1,272
Mobis Parts Jiangsu Yueda Trading Co., Ltd. 1,108 1,310
Tianjin Mobis Automotive Parts Co., Ltd. 5,399 3,282
Hyundai Mobis (Hongkong) Co., Limited - (77)
Mobis Parts Europe N.V. 73,688 192,098
Mobis Slovakia s.r.o. 8,344 6,666
Mobis Automotive Czech s.r.o. 8,338 5,990
Mobis Module CIS, LLC 1,153 -
Mobis America Inc. 22,406 17,515
America Auto Parts Inc. 230 (12)
Mobis Parts Middle East FZE 59,152 50,214
Mobis India, Ltd. 11,124 10,164
Hyundai Autonet India PVT., Ltd. - 1,080
Mobis Parts Australia PTY., Ltd. 1,201 987
266,892
342,032 W
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
29
7. Equity Method Accounted Investments, Continued
(d) Changes in the opening and closing balances of investments in companies accounted for using the equity method
for the year ended December 31, 2010 were as follows:
(In millions of won)
Company
Balance at
Jan. 1,
2010
Net
income
(loss)
Accumulated
other
comprehensive
income
Other
increase
(decrease)
(*1)
Balance at
Dec. 31,
2010
Hyundai Motor Company W 3,880,191 803,819 64,565 (71,277) 4,677,298
Autoever Systems Corporation 21,425 6,249 (76) (1,000) 26,598
ZF Lemfoerder Chassis Technology
Korea Co., Ltd. 4,492 87 - -
4,579
Hyundai Amco Co., Ltd. 80,843 12,601 (5,085) (4,998) 83,361
IHL Co., Ltd. 36,903 (6,306) - (3,450) 27,147
Hyundai Commercial Co., Ltd.(*2) 21,979 6,598 8,051 (36,628) -
Hyundai Powertech Co., Ltd. 107,155 15,210 (370) 24,848 146,843
HMC Investment Union 6,202 263 - 14,688 21,153
M&Soft 10,621 2,652 - (106) 13,167
HL Green Power Inc. - (1,267) - 14,790 13,523
Hyundai Motor (Shanghai) Co., Ltd. 18,228 12,876 (843) - 30,261
Shanghai Hyundai Mobis Automotive
Parts Co., Ltd. 120,009 52,878 921 -
173,808
Jiangsu Mobis Automotive Parts Co.,
Ltd. 96,915 38,453 170 -
135,538
Beijing Hyundai Mobis Automotive
Parts Co., Ltd. 223,061 57,648 (624) -
280,085
Beijing Mobis Transmission Co., Ltd. 61,433 5,747 376 - 67,556
Beijing Mobis Chonche Automotive
Parts Co., Ltd. 17,304 4,320 207 (1,861)
19,970
Beijing Hyundai Mobis Parts Co.,
Ltd. 20,983 14,256 66 (7,033)
28,272
Hyundai Motor Group (China) Ltd. 27,747 21,764 662 (9,061) 41,112
Wuxi Mobis Automotive Parts Co.,
Ltd. 24,814 3,197 (450) -
27,561
Mobis Parts Jiangsu Yueda Trading
Co., Ltd. 9,849 7,575 (162) (3,105)
14,157
Tianjin Mobis Automotive Parts Co.,
Ltd. 20,600 21,408 42 -
42,050
Hyundai Mobis (Hongkong) Co.,
Limited - 2 1 -
3
Mobis Parts Europe N.V.(*3) - 15,538 (15,538) - -
Mobis Slovakia s.r.o. 33,213 20,472 (3,570) - 50,115
Mobis Automotive Czech s.r.o. 20,503 14,357 (1,771) - 33,089
Mobis Module CIS, LLC 33,808 (7,503) (3,306) 5,738 28,737
Mobis America Inc. 195,332 53,507 (7,586) (2,009) 239,244
America Auto Parts Inc. 19,637 12,386 (655) 2,336 33,704
Mobis Brasil Fabricacao De Auto
Pecas Ltda - (585) 1,090 16,213
16,718
Mobis Parts Middle East FZE(*3) W - 5,533 (5,533) - -
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
30
7. Equity Method Accounted Investments, Continued
(In millions of won)
Company
Balance at
Jan. 1, 2010
Net
income
(loss)
Accumulated
other
comprehensive
income
Other
increase
(decrease)
(*1)
Balance at
Dec. 31,
2010
Mobis India, Ltd. W 84,059 29,002 700 4,405 118,166
Hyundai Autonet India PVT., Ltd. 4,405 - - (4,405) -
Mobis India Research and Development
Private Limited(formerly, Hyundai
Autonet India Engineering PVT
Limited) 925 - - -
925
Mobis Parts Australia PTY., Ltd. 25,159 4,460 3,177 - 32,796
5,227,795
1,227,197
34,459
(61,915)
6,427,536 W
(*1) Other increase (decrease) is consisted of decrease upon receipt of the dividends, acquisition of new shares,
changes in the stockholders‟ equity and acquisition from the merger.
(*2) The Company sold its entire share of Hyundai Commercial Co., Ltd. on June 30, 2010.
(*3) The Company discontinued the application of the equity method as the book value of the investments was
reduced to zero. Changes in the Company‟s interest, which were not recognized, amounted to W69,576
million.
Changes in the opening and closing balances of investments in companies accounted for using the equity method
for the year ended December 31, 2009 were as follows:
(In millions of won)
Company
Balance at
Jan. 1, 2009
Net
income
(loss)
Accumulated
other
comprehensive
income
Other
increase
(decrease)
(*1)
Balance at
Dec. 31,
2009
Hyundai Motor Company W 2,241,846 367,351 (19,705) 1,290,699 3,880,191
Autoever Systems Corporation 16,019 5,532 (126) - 21,425
ZF Lemfoerder Chassis Technology
Korea Co., Ltd. 4,434 58 - -
4,492
Hyundai Amco Co., Ltd. 71,947 13,181 712 (4,997) 80,843
IHL Co., Ltd. 34,568 2,335 - - 36,903
Hyundai Commercial Co., Ltd. 14,976 5,719 1,284 - 21,979
Hyundai Powertech Co., Ltd. 93,393 13,005 757 - 107,155
HMC Investment Union 6,013 189 - - 6,202
M&Soft - 1,758 46 8,817 10,621
Hyundai Motor (Shanghai) Co., Ltd. W 16,494 2,867 (1,133) - 18,228
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
31
7. Equity Method Accounted Investments, Continued
(In millions of won)
Company
Balance at
Jan. 1, 2009
Net
income
(loss)
Accumulated
other
comprehensive
income
Other
increase
(decrease)
(*1)
Balance at
Dec. 31,
2009
Shanghai Hyundai Mobis Automotive
Parts Co., Ltd. W 82,794 47,007 (9,792) -
120,009
Jiangsu Mobis Automotive Parts Co.,
Ltd. 54,473 50,356 (7,914) -
96,915
Beijing Hyundai Mobis Automotive
Parts Co., Ltd. 177,016 63,323 (17,278) -
223,061
Beijing Mobis Transmission Co., Ltd. 56,974 9,237 (4,778) - 61,433
Beijing Mobis Chonche Automotive
Parts Co., Ltd. 15,143 4,715 (1,448) (1,106)
17,304
Beijing Hyundai Mobis Parts Co.,
Ltd. 15,808 11,020 (1,693) (4,152)
20,983
Hyundai Motor Group (China) Ltd. 23,054 14,262 (2,442) (7,127) 27,747
Wuxi Mobis Automotive Parts Co., Ltd. 17,954 8,834 (1,974) - 24,814
Mobis Parts Jiangsu Yueda Trading Co.,
Ltd. 7,572 4,720 (660) (1,783)
9,849
Tianjin Mobis Automotive Parts Co.,
Ltd. - 7,736 (2,039) 14,903
20,600
Hyundai Mobis (Hongkong) Co.,
Limited(*2) 3 (10) 7 -
-
Hyundai Electronics Tianjin Co., Ltd. - 78 - (78) -
Mobis Parts Europe N.V.(*2) - (4,328) 4,328 - -
Mobis Slovakia s.r.o. 16,822 1,823 (19,215) 33,783 33,213
Hyundai Autonet Europe - 900 - (900) -
Mobis Automotive Czech s.r.o. 2,997 18,694 (1,188) - 20,503
Mobis Module CIS, LLC 7,242 - - 26,566 33,808
Mobis America Inc. 160,716 (10,892) (17,871) 63,379 195,332
Hyundai Autonet America Corp. - 318 - (318) -
America Auto Parts Inc. 20,372 976 (1,711) - 19,637
Mobis Parts Middle East FZE(*2) - (2,695) 2,695 - -
Mobis India, Ltd. 88,772 (576) (4,137) - 84,059
Hyundai Autonet India PVT., Ltd. - 831 (239) 3,813 4,405
Hyundai Autonet India Engineering
PVT Limited - - - 925
925
Mobis Parts Australia PTY., Ltd. 18,085 3,219 3,855 - 25,159
W 3,265,487 641,543 (101,659) 1,422,424 5,227,795
(*1) Other increase (decrease) is consisted of decrease upon receipt of the dividends, acquisition of new shares,
changes in the stockholders‟ equity and acquisition from the merger.
(*2) The Company discontinued the application of the equity method as the book value of the investments was
reduced to zero. Changes in the Company‟s interest, which were not recognized, amounted to W184,865
million.
7. Equity Method Accounted Investments, Continued
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
32
(e) Financial information of equity method accounted investees, which represents 100% of the entities‟ balances, as
of December 31, 2010 is summarized as follows:
(In millions of won)
Company(*) Total assets Total liabilities Sales Net income
Hyundai Motor Company W 41,067,680 13,720,878 36,769,426 5,266,971
Autoever Systems Corporation 292,895 159,910 563,150 31,421
ZF Lemfoerder Chassis Technology Korea
Co., Ltd. 23,103 6,172 33,030 101
Hyundai Amco Co., Ltd. 918,280 501,210 1,241,477 63,649
IHL Co., Ltd. 130,735 99,845 257,009 (6,276)
Hyundai Powertech Co., Ltd. 1,528,043 915,038 1,980,163 50,715
HMC Investment Union 54,394 - 1,478 941
M&Soft 71,073 19,725 63,839 9,997
HL Green Power Inc. 29,549 3,033 1,875 (2,484)
Hyundai Motor (Shanghai) Co., Ltd. 56,420 20,185 59,894 11,689
Shanghai Hyundai Mobis Automotive Parts
Co., Ltd. 205,042 33,085 213,336 53,062
Jiangsu Mobis Automotive Parts Co.,
Ltd. 477,007 323,554 1,358,804 46,048
Beijing Hyundai Mobis Automotive Parts
Co., Ltd. 1,038,167 724,927 3,113,255 59,981
Beijing Mobis Transmission Co., Ltd. 319,904 102,547 380,830 17,008
Beijing Mobis Chonche Automotive Parts
Co., Ltd. 81,462 46,632 199,916 7,517
Beijing Hyundai Mobis Parts Co., Ltd. 123,233 59,398 232,449 31,898
Hyundai Motor Group (China) Ltd. 451,239 245,678 2,076,411 111,450
Wuxi Mobis Automotive Parts Co., Ltd. 151,663 59,873 247,389 13,713
Mobis Parts Jiangsu Yueda Trading Co., Ltd. 72,023 41,489 89,132 14,441
Tianjin Mobis Automotive Parts Co., Ltd. 201,494 147,482 503,945 21,105
Hyundai Mobis (Hongkong) Co., Limited 11,906 11,903 63,642 79
Mobis Parts Europe N.V. 679,081 577,195 731,503 4,374
Mobis Slovakia s.r.o. 426,233 366,400 1,078,910 21,537
Mobis Automotive Czech s.r.o. 199,351 157,924 671,244 16,190
Mobis Module CIS, LLC 102,965 72,728 579 (4,185)
Mobis America Inc. 762,166 499,056 2,350,730 57,959
America Auto Parts Inc. 209,789 175,187 1,137,095 12,682
Mobis Brasil Fabricacao De Auto Pecas
Ltda 16,796 78 345 (952)
Mobis Parts Middle East FZE W 231,355 186,366 320,584 16,869
7. Equity Method Accounted Investments, Continued
(In millions of won)
Company(*) Total assets Total liabilities Sales Net income
Mobis India, Ltd. W 339,775 208,385 793,085 27,788
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
33
Mobis India Research and Development
Private Limited (formerly, Hyundai
Autonet India Engineering PVT Limited) 3,201 1,354 3,638 306
Mobis Parts Australia PTY., Ltd. 82,134 48,136 44,864 4,619
W 50,358,158 19,535,373 56,583,027 5,960,213
(*) The Company accounted for its investment in certain investees by using equity method of accounting based
on the unaudited financial statements, and performed procedures to verify the unaudited financial
statements.
Financial information of equity method accounted investees, which represents 100% of the entities‟ balances, as
of December 31, 2009 is summarized as follows:
(In millions of won)
Company(*) Total assets Total liabilities Sales Net income
Hyundai Motor Company W 35,446,135 13,417,112 31,859,327 2,961,509
Autoever Systems Corporation 253,603 146,480 537,040 27,217
ZF Lemfoerder Chassis Technology Korea
Co., Ltd. 25,205 8,487 30,765 78
Hyundai Amco Co., Ltd. 809,728 405,258 1,081,273 45,428
IHL Co., Ltd. 116,909 79,774 197,597 2,843
Hyundai Commercial Co., Ltd. 1,629,739 1,519,842 162,984 28,595
Hyundai Powertech Co., Ltd. 1,381,122 918,240 1,304,903 39,649
HMC Investment Union 31,012 - 1,335 947
M&Soft 46,188 5,291 43,964 9,239
Hyundai Motor (Shanghai) Co., Ltd. 41,753 23,696 47,219 5,316
Shanghai Hyundai Mobis Automotive Parts
Co., Ltd. 165,608 41,647 144,912 53,545
Jiangsu Mobis Automotive Parts Co.,
Ltd. 365,599 259,537 1,010,285 55,331
Beijing Hyundai Mobis Automotive Parts
Co., Ltd. 808,397 557,834 2,643,431 78,723
Beijing Mobis Transmission Co., Ltd. 303,376 104,864 375,144 29,318
Beijing Mobis Chonche Automotive Parts
Co., Ltd. 80,847 50,914 214,818 8,480
Beijing Hyundai Mobis Parts Co., Ltd. 93,360 47,976 206,027 24,201
Hyundai Motor Group (China) Ltd. 401,462 262,722 1,579,501 71,304
Wuxi Mobis Automotive Parts Co., Ltd. 140,896 63,604 212,901 25,228
Mobis Parts Jiangsu Yueda Trading Co.,
Ltd. W 48,753 26,435 76,526 10,460
7. Equity Method Accounted Investments, Continued
(In millions of won)
Company(*) Total assets Total liabilities Sales Net income
Tianjin Mobis Automotive Parts Co., Ltd. W 192,728 160,407 471,273 12,153
Hyundai Mobis (Hongkong) Co., Limited 22,584 22,661 11,511 (13)
Mobis Parts Europe N.V. 782,806 702,028 771,553 (3,359)
Mobis Slovakia s.r.o. 455,334 412,672 692,446 2,988
Mobis Automotive Czech s.r.o. 200,539 174,046 551,002 11,357
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
34
Mobis America Inc. 617,211 403,574 1,217,929 (1,872)
America Auto Parts Inc. 119,734 99,474 531,632 910
Mobis Parts Middle East FZE 211,367 182,190 298,241 2,554
Mobis India, Ltd. 356,945 261,033 768,618 15,440
Hyundai Autonet India PVT., Ltd. 26,349 20,203 60,275 2,054
Hyundai Autonet India Engineering PVT
Limited 1,961 442 1,718 158
Mobis Parts Australia PTY., Ltd. 69,496 43,350 34,747 3,548
45,246,746
20,421,793
47,140,897
3,523,329 W
(*) The Company accounted for its investment in certain investees by using equity method of accounting based
on the unaudited financial statements, and performed procedures to verify the unaudited financial
statements.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
35
7. Equity Method Accounted Investments, Continued
(f) The adjustments to the financial information of the investees‟ balance prior to applying the equity method for the
year ended December 31, 2010 are as follows:
(In millions of won)
Company
Net assets before
adjustments Adjustments (*1)
Net assets after
adjustments
Hyundai Motor Company(*2) W 4,420,208 (30,447) 4,389,761
Autoever Systems Corporation 26,598 - 26,598
ZF Lemfoerder Chassis Technology Korea Co.,
Ltd. 4,627 - 4,627
Hyundai Amco Co., Ltd. 83,361 - 83,361
IHL Co., Ltd. 27,801 - 27,801
Hyundai Powertech Co., Ltd. 152,317 - 152,317
HMC Investment Union 21,153 - 21,153
M&Soft 13,180 - 13,180
HL Green Power Inc. 13,523 - 13,523
Hyundai Motor (Shanghai) Co., Ltd. 36,235 2,172 38,407
Shanghai Hyundai Mobis Automotive Parts Co.,
Ltd. 150,463 26,302 176,765
Jiangsu Mobis Automotive Parts Co., Ltd. 153,454 - 153,454
Beijing Hyundai Mobis Automotive Parts
Co., Ltd. 313,240 - 313,240
Beijing Hyundai Mobis Transmission Co., Ltd. 69,465 - 69,465
Beijing Mobis Chonche Automotive Parts Co.,
Ltd. 20,898 - 20,898
Beijing Hyundai Mobis Parts Co., Ltd. 31,919 - 31,919
Hyundai Motor Group (China) Ltd. 41,112 - 41,112
Wuxi Mobis Automotive Parts Co., Ltd. 30,980 (545) 30,435
Mobis Parts Jiangsu Yueda Trading Co., Ltd. 15,265 - 15,265
Tianjin Mobis Automotive Parts Co., Ltd. 54,013 - 54,013
Hyundai Mobis (Hongkong) Co., Limited 3 - 3
Mobis Parts Europe N.V. 101,886 - 101,886
Mobis Slovakia s.r.o. 59,834 (2,048) 57,786
Mobis Automotive Czech s.r.o. 41,427 - 41,427
Mobis Module CIS, LLC 30,237 (347) 29,890
Mobis America Inc. 263,109 (1,299) 261,810
America Auto Parts Inc. 34,604 (670) 33,934
Mobis Brasil Fabricacao De Auto Pecas Ltda 16,718 - 16,718
Mobis Parts Middle East FZE 44,989 - 44,989
Mobis India, Ltd. 131,389 (1,585) 129,804
Mobis India Research and Development Private
Limited(formerly, Hyundai Autonet India
Engineering PVT Limited) 1,847 - 1,847
Mobis Parts Australia PTY., Ltd. 33,997 - 33,997
W 6,439,852 (8,467) 6,431,385
7. Equity Method Accounted Investments, Continued
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
36
(*1) Adjustments are consisted of adjustments in the investees‟ accounting principles and estimates to be
consistent with those of the Company.
(*2) The Company adjusted the effects of the equity method of the circular investment in accordance with
SKAS No. 15, Equity Method.
The adjustments to the financial information of the investees‟ balance prior to applying the equity method for the
year ended December 31, 2009 are as follows:
(In millions of won)
Company
Net assets before
adjustments Adjustments (*1)
Net assets after
adjustments
Hyundai Motor Company(*2) W 3,560,667 (51,497) 3,509,170
Autoever Systems Corporation 21,425 - 21,425
ZF Lemfoerder Chassis Technology Korea
Co., Ltd. 4,570 - 4,570
Hyundai Amco Co., Ltd. 80,843 - 80,843
IHL Co., Ltd. 37,135 - 37,135
Hyundai Commercial Co., Ltd. 21,979 - 21,979
Hyundai Powertech Co., Ltd. 115,015 - 115,015
HMC Investment Union 6,202 - 6,202
M&Soft 10,498 - 10,498
Hyundai Motor (Shanghai) Co., Ltd. 18,057 7,498 25,555
Shanghai Hyundai Mobis Automotive Parts
Co., Ltd. 108,466 12,844 121,310
Jiangsu Mobis Automotive Parts Co., Ltd. 106,062 - 106,062
Beijing Hyundai Mobis Automotive Parts Co.,
Ltd. 250,563 - 250,563
Beijing Hyundai Mobis Transmission Co., Ltd. 63,442 - 63,442
Beijing Mobis Chonche Automotive Parts Co.,
Ltd. 17,960 - 17,960
Beijing Hyundai Mobis Parts Co., Ltd. 22,692 - 22,692
Hyundai Motor Group (China) Ltd. 27,747 - 27,747
Wuxi Mobis Automotive Parts Co., Ltd. 26,086 - 26,086
Mobis Parts Jiangsu Yueda Trading Co., Ltd. 11,159 - 11,159
Tianjin Mobis Automotive Parts Co., Ltd. 32,321 - 32,321
Hyundai Mobis (Hongkong) Co., Limited (77) - (77)
Mobis Parts Europe N.V. 80,778 - 80,778
Mobis Slovakia s.r.o. 42,662 (6,358) 36,304
Mobis Automotive Czech s.r.o. 26,493 - 26,493
Mobis Module CIS, LLC 29,542 - 29,542
Mobis America Inc. 213,637 (2,118) 211,519
America Auto Parts Inc. 20,260 (635) 19,625
Mobis Parts Middle East FZE 29,177 - 29,177
Mobis India, Ltd. 95,912 (1,689) 94,223
Hyundai Autonet India PVT., Ltd. W 6,146 - 6,146
7. Equity Method Accounted Investments, Continued
(In millions of won)
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
37
Company
Net assets before
adjustments Adjustments (*1)
Net assets after
adjustments
Mobis India Research and Development Private
Limited(formerly, Hyundai Autonet India
Engineering PVT Limited) W 1,519 - 1,519
Mobis Parts Australia PTY., Ltd. 26,146 - 26,146
W 5,115,084 (41,955) 5,073,129
(*1) Adjustments are consisted of adjustments in the investees‟ accounting principles and estimates to be
consistent with those of the Company.
(*2) The Company adjusted the effects of the equity method of the circular investment in accordance with
SKAS No. 15, Equity Method Accounting.
8. Transactions and Balances with Related Companies
(a) Details of parent and subsidiary relationships as of December 31, 2010 are as follows:
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
38
Controlled subsidiary Ownership (%)
IHL Co., Ltd. 90.00%
Beijing Hyundai Mobis Automotive Parts Co., Ltd. 100.00%
Jiangsu Mobis Automotive Parts Co., Ltd. 100.00%
Wuxi Mobis Automotive Parts Co., Ltd.(*1) 100.00%
Shanghai Hyundai Mobis Automotive Parts Co., Ltd.(*2) 100.00%
Hyundai Motor (Shanghai) Co., Ltd. 100.00%
Hyundai Mobis (Hongkong) Co., Limited 100.00%
Beijing Mobis Chonche Automotive Parts Co., Ltd. 60.00%
Tianjin Mobis Automotive Parts Co., Ltd. 100.00%
Mobis America Inc. 100.00%
Mobis Alabama, LLC(*3) 100.00%
Mobis Parts America, LLC(*3) 100.00%
Mobis Brasil Fabricacao De Auto Pecas Ltda 100.00%
America Auto Parts Inc. 100.00%
Mobis North America, LLC(*4) 100.00%
Mobis Parts Europe N.V. 100.00%
Mobis Parts CIS, LLC(*5) 100.00%
Mobis Slovakia, s.r.o. 100.00%
Mobis Automotive Czech s.r.o. 100.00%
Mobis Module CIS, LLC 100.00%
Mobis Parts Middle East FZE 100.00%
Mobis Auto Parts Middle East Egypt(*6) 100.00%
Mobis India, Ltd.(*7) 100.00%
Mobis India Research and Development Private Limited (formerly,
Hyundai Autonet India Engineering PVT Limited) 100.00%
Mobis Parts Australia PTY., Ltd. 100.00%
(*1) Subsidiary in which the Company and Shanghai Hyundai Mobis Automotive Parts Co., Ltd. own 33.75%
and 66.25%, respectively.
(*2) Subsidiary in which the Company and Hyundai Motor (Shanghai) Co., Ltd. own 87.5% and 12.5%,
respectively.
(*3) Subsidiary in which Mobis America Inc. owns 100%.
(*4) Ohio Module Manufacturing Co., LLC, previously a 100% owned subsidiary of America Auto Parts Inc.,
acquired Mobis North America, LLC, a 100% owned subsidiary of Mobis America Inc., in a merger on
April 1, 2010. The entity changed its name to Mobis North America, LLC.
(*5) Subsidiary in which Mobis Parts Europe N.V. owns 99%.
(*6) Subsidiary in which Mobis Parts Middle East FZE owns 100%.
(*7) Subsidiary in which acquired due to the merger with Hyundai Autonet India PVT., Ltd. in January, 2010.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
39
8. Transactions and Balances with Related Companies, Continued
(b) Significant transactions which occurred in the normal course of business with related companies for the years
ended December 31, 2010 and 2009 are as follows:
(In millions of won) Sales and
other income
Purchase and
other expenses
Company 2010 2009 2010 2009
Associates
M&Soft W - - 25,190 5,820
Hyundai Amco Co., Ltd. 54 5 40,319 3,846
Autoever Systems Corporation 1,156 1,014 36,067 33,271
HL Green Power Inc. 182 - 1,801 -
ZF Lemfoerder Chassis Technology Korea Co., Ltd. - - 29,011 28,803
Hyundai Motor Company 3,871,194 3,487,187 583,440 508,952
Hyundai PowerTech Co., Ltd. 9 9 410,065 264,302
Beijing Hyundai Mobis Parts Co., Ltd. 32,634 26,455 - -
Beijing Mobis Transmission Co., Ltd. 174,670 142,969 - -
Mobis Parts Jiangsu Yueda Trading Co., Ltd. 12,582 12,447 - -
4,092,481 3,670,086 1,125,893 844,994
Subsidiaries
IHL Co., Ltd. 423 208 178,636 51,919
Beijing Hyundai Mobis Automotive Parts Co., Ltd. 876,782 622,114 255 -
Beijing Mobis Chonche Automotive Parts Co., Ltd. 30,590 29,307 2,113 1,899
Hyundai Autonet Europe - 159 - -
Mobis India Research and Development Private
Limited
4 - 3,603 759
Hyundai Mobis (Hongkong) Co., Limited. - 5,234 202 606
Hyundai Motor (Shanghai) Co., Ltd. 41,125 33,591 285 341
Jiangsu Mobis Automotive Parts Co., Ltd. 351,372 205,545 14 127
Mobis Alabama, LLC 480,962 168,118 268 14
Mobis Auto Parts Middle East Egypt 50,811 7,610 - -
Mobis Automotive Czech s.r.o. 190,173 109,408 52 -
Mobis India, Ltd. 208,047 150,335 140 115
Mobis Module CIS, LLC 8,088 23 - -
Mobis North America, LLC(*1) 33,312 17,248 3,617 2,214
Mobis Parts America, LLC 109,626 84,774 3,923 352
Mobis Parts Australia PTY., Ltd. 4,772 3,753 32 -
Mobis Parts CIS, LLC 85,364 81,104 - -
Mobis Parts Europe N.V. 284,930 336,858 3,345 20
Mobis Parts Middle East FZE 240,457 271,717 - -
Mobis Slobakia, s.r.o. 370,846 144,680 56 149
Shanghai Hyundai Mobis Automotive Parts Co., Ltd. 43,728 34,945 110 225
Tianjin Mobis Automotive Parts Co., Ltd. 201,755 108,121 24,932 11,910
Wuxi Mobis Automotive Parts Co., Ltd. 92,933 56,196 11,872 17,136
W 3,706,100 2,471,048 233,455 87,786
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
40
8. Transactions and Balances with Related Companies, Continued
(b) Significant transactions which occurred in the normal course of business with related companies for the years
ended December 31, 2010 and 2009 are as follows, Continued:
(In millions of won) Sales and
other income
Purchases and
other expenses
Company 2010 2009 2010 2009
Affiliates
Glovis Co., Ltd. W 57,766 11,679 236,145 173,793
Kia Motors Corporation 2,692,194 1,681,674 83,225 63,467
Kia Tigers Co., Ltd. - - 33 30
Metia Corporation - - 31,989 17,127
Automobile Industrial Ace - - 41,140 30,473
Ngibe Co., Ltd. - - 62 41
Mseat Co., Ltd. - - 2,326 1,766
Wistco Co., Ltd. - - 4,928 6,254
Hyundai Wia., Corp. 86,901 57,996 221,061 128,231
Innocean Worldwide., Inc. 27 54 4,004 3,583
Samwoo., Inc. - - 422 474
Carnes Company Ltd. 309 59 - -
Kefico Corporation 2,354 3,599 22,202 18,995
Partecs Company., Ltd. - - 4,831 3,577
Haevichi Hotel and Resort Co., Ltd.
(formerly, Haevichi Resort Co., Ltd.)
- - 675 4,500
Haevichi Country Club Ltd. - - 606 709
Hyundai Dymos., Inc. 6,269 4,530 204,634 138,075
Hyundai-Rotem Company 205 204 461 976
Hyundai Autonet Co.,Ltd.(*2) - 588 - 280,867
Hyundai Card Co., Ltd. 120 190 1,219 971
Hyundai Capital Services, Inc. - - 34 22
Hyundai Hysco Corporation - 2 11,238 10,190
Dongfeng Yueda Kia Motors Co., Ltd. - - 504 682
Glovis Alabama. LLC - - 12 -
Hyundai-Assan Otomotiv Sanayi Ve Ticaret A.S. 55,400 32,757 - -
Hyundai Auto Canada Corp. 50,264 54,739 - -
Hyundai Motor America 168,730 153,931 - -
Hyundai Motor Company Australia Pty Ltd. 20,180 17,257 - -
Hyundai Motor India Ltd. 29 - - 829
Hyundai Motor Japan 980 966 - 825
Hyundai Motor Japan R&D Center, Inc 180 - - -
Hyundai Motor Manufacturing Rus LLC 613 - - -
Hyundai Translead 7,852 7,266 - -
Kia Japan Co., Ltd. 1 - - -
Kia Motors America, Inc. 122,719 119,585 - -
Kia Motors Australia Pty Ltd. 8,967 9,531 - -
Kia Motors New Zealand Ltd. W 848 891 - -
8. Transactions and Balances with Related Companies, Continued
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
41
(b) Significant transactions which occurred in the normal course of business with related companies for the years
ended December 31, 2010 and 2009 are as follows, Continued:
(In millions of won) Sales and
other income
Purchases and
other expenses
Company 2010 2009 2010 2009
Affiliates
Kia Canada Inc. W 20,332 26,513 - -
Kia Motors Sales Slovensko s.r.o. - 4 - -
Kia Motors (UK) Ltd. - 11 - -
Kia Motors France S.A.S. - 239 - -
Kia Motors Italia S.P.A - 15 - -
Wia Automotive Engine - - - 11
3,303,240 2,184,280 871,751 886,468
W 11,101,821 8,325,414 2,231,099 1,819,248
(*1) Ohio Module Manufacturing Co., LLC acquired Mobis North America, LLC in a merger on April 1, 2010.
The entity changed its name to Mobis North America, LLC.
(*2) The Company merged with Hyundai Autonet Co., Ltd. in June 2009.
(c) Account balances with related companies as of December 31, 2010 and 2009 are as follows:
(In millions of won) Receivables Payables
Company 2010 2009 2010 2009
Associates M&Soft W - - 11,862 4,792
Hyundai Amco Co., Ltd. 1 1 21,792 454
Autoever Systems Corporation 176 34 15,133 13,750
HL Green Power Inc. 17 - 1,579 -
ZF Lemfoerder Chassis Technology Korea Co.,
Ltd.
2 - 4,750 7,945
Hyundai Motor Company 824,905 1,071,786 131,872 253,085
Hyundai PowerTech Co., Ltd. 61 - 79,392 57,687
Beijing Hyundai Mobis Parts Co., Ltd. 7,307 156 1 -
Beijing Mobis Transmission Co., Ltd. 6,554 2,558 4 54
Mobis Parts Jiangsu Yueda Trading Co., Ltd. 28 11 - 3
W 839,051 1,074,546 266,385 337,770
8. Transactions and Balances with Related Companies, Continued
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
42
(c) Account balances with related companies as of December 31, 2010 and 2009 are as follows, Continued:
(In millions of won) Receivables Payables
Company 2010 2009 2010 2009
Subsidiaries
IHL Co., Ltd. W 760 225 71,111 26,573
Beijing Hyundai Mobis Automotive Parts Co.,
Ltd.
32,149 20,377 290 11
Beijing Mobis Chonche Automotive Parts Co.,
Ltd.
1,878 1,610 - 232
Hyundai Autonet Europe - 264 - -
Mobis India Research and Development Private
Limited
- - 607 149
Hyundai Mobis (Hongkong) Co., Limited. - 3,512 31 7
Hyundai Motor (Shanghai) Co., Ltd. 506 84 9 15
Jiangsu Mobis Automotive Parts Co., Ltd. 18,259 2,401 89 1
Mobis Alabama, LLC 10,976 11,721 6,174 344
Mobis Auto Parts Middle East Egypt 1,031 - - -
Mobis Automotive Czech s.r.o. 5,361 3,186 430 160
Mobis India, Ltd. 7,087 3,290 109 30
Mobis Module CIS, LLC 1,935 23 - -
Mobis North America, LLC(*1) 7,403 3,192 816 1,055
Mobis Parts America, LLC 1,460 5,490 723 370
Mobis Parts Australia PTY., Ltd. 175 323 32 -
Mobis Parts CIS, LLC 2,399 819 - -
Mobis Parts Europe N.V. 17,641 15,750 1,113 -
Mobis Parts Middle East FZE 2,720 2,743 8 -
Mobis Slovakia, s.r.o. 13,193 7,868 748 474
Shanghai Hyundai Mobis Automotive Parts Co.,
Ltd.
5,412 4,610 14 16
Tianjin Mobis Automotive Parts Co., Ltd. 10,485 24,415 6,324 3,121
Wuxi Mobis Automotive Parts Co., Ltd. 3,471 2,786 1,903 2,069
W 144,301 114,689 90,531 34,627
8. Transactions and Balances with Related Companies, Continued
(c) Account balances with related companies as of December 31, 2010 and 2009 are as follows, Continued:
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
43
(In millions of won) Receivables Payables
Company 2010 2009 2010 2009
Affiliates
Glovis Co., Ltd. W 5,406 3,346 21,694 16,947
Kia Motors Corporation 614,277 510,330 73,950 58,767
Kia Tigers Co., Ltd. - - - 33
Metia Corporation 25 - 7,561 6,987
Automobile Industrial Ace 14 - 15,705 13,451
Ngibe Co., Ltd. - - - 10
Mseat Co., Ltd. 1 - 1,149 869
Wistco Co., Ltd. - - 1,094 2,604
Hyundai Wia., Corp. 31,799 21,449 44,941 39,911
Innocean Worldwide., Inc. - 38 22,155 14,371
Samwoo., Inc. - - 144 188
Carnes Company Ltd. 28 26 - -
Kefico Corporation 37 428 4,858 5,936
Partecs Company., Ltd. - - 2,008 2,069
Haevichi Hotel and Resort Co., Ltd.
(formerly, Haevichi Resort Co., Ltd.)
- - 377 354
Haevichi Country Club Ltd. - - 412 520
Hyundai Dymos., Inc. 709 533 39,685 37,391
Hyundai-Rotem Company 96 - 43 46
Hyundai Card Co., Ltd. - 90 489 358
Hyundai Capital Services, Inc. - - - 1
Hyundai Hysco Corporation - - 4,981 4,270
Dongfeng Yueda Kia Motors Co., Ltd. - - 20 10
Hyundai-Assan Otomotiv Sanayi Ve Ticaret A.S. 813 219 82 -
Hyundai Auto Canada Corp. 5,773 8,540 - -
Hyundai Motor America 2,077 3,372 - -
Hyundai Motor Company Australia Pty Ltd. 355 278 - -
Hyundai Motor India Ltd. - - - 158
Hyundai Motor Japan 24 31 - -
Hyundai Motor Manufacturing Alabama, LLC - - 13 2
Hyundai Motor Manufacturing Rus LLC 27 - - -
Hyundai Translead 1,474 398 - -
Kia Motors America, Inc. 2,147 1,065 37 67
Kia Motors Australia Pty Ltd. 219 208 - -
Kia Motors New Zealand Ltd. 68 56 - -
Kia Canada Inc. 176 1,233 18 3
Kia Motors Slovakia s.r.o. - - 43 36
Kia Motors France S.A.S. - 56 - -
665,545 551,696 241,459 205,359
W 1,648,897 1,740,931 598,375 577,756
8. Transactions and Balances with Related Companies, Continued
(c) Account balances with related companies as of December 31, 2010 and 2009 are as follows, Continued:
(*1) Ohio Module Manufacturing Co., LLC acquired Mobis North America, LLC in a merger on April 1, 2010.
The entity changed its name to Mobis North America, LLC.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
44
(d) The Company has securities and financial instruments amounting to W190,231 million at HMC investment
securities Co., Ltd. For the year ended December 31, 2010, the Company recorded salaries of W22,225 million
and severance benefits of W14,561 million as key management compensation. Key management consists of
executive officers who have the authority and responsibility in the planning, directing and control of the
Company‟s operations. The Company provided payment guarantees to related parties amounting to USD
1,217,162 thousand as of December 31, 2010.
9. Property, Plant and Equipment
(a) Property, plant and equipment at December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Property, plant and equipment at cost W 1,951,777 1,811,363
Government grant (983) (1,048)
Accumulated depreciation (536,548) (447,601)
W 1,414,246 1,362,714
(b) Changes in property, plant and equipment for the year ended December 31, 2010 were as follows:
(In millions of won)
Book value as
of
Jan. 1 Acquisitions Disposals Depreciation Other
Book value
as of
Dec. 31
Land W 362,774 135 (2,222) - 1,209 361,896
Buildings 549,621 547 (3,691) (24,070) 10,403 532,810
Structures 26,909 318 (39) (1,326) 2,195 28,057
Machinery 278,933 18,210 (3,819) (71,011) 116,112 338,425
Vehicles 29,838 6,045 (200) (4,688) - 30,995
Others 91,751 17,541 (1,871) (38,912) 11,414 79,923
Construction-in-
progress 22,888 165,722 - - (146,470) 42,140
W 1,362,714 208,518 (11,842) (140,007) (5,137) 1,414,246
9. Property, Plant and Equipment, Continued
Changes in property, plant and equipment for the year ended December 31, 2009 were as follows:
(In millions of won)
Book value
as of
Jan. 1 Acquisitions
Increases
due to the
merger Disposals Depreciation Other
Book value
as of
Dec. 31
Land W 314,106 2,427 45,091 (7,276) - 8,426 362,774
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
45
Buildings 441,270 1,096 105,330 (31,538) (20,814) 54,277 549,621
Structures 23,397 1,735 4,129 (527) (1,172) (653) 26,909
Machinery 230,366 19,894 37,131 (6,449) (56,117) 54,108 278,933
Vehicles 8,471 2,201 317 (532) (4,319) 23,700 29,838
Others 75,405 29,311 29,855 (5,378) (37,004) (438) 91,751
Construction-
in-progress 47,134 56,623 344 - - (81,213) 22,888
W 1,140,149 113,287 222,197 (51,700) (119,426) 58,207 1,362,714
(c) Insurance
As of December 31, 2010 and 2009, inventories, machinery, equipment and tools amounted W1,230,843 million
and W1,329,595 million were insured against property all risks policy up to W760,027 million and W818,791
million, respectively.
(d) The officially declared value of land at December 31, 2010 and 2009, as announced by the Ministry of Land,
Transport and Maritime Affairs, were as follows:
(In millions of won) 2010 2009
Book value Declared value Book value Declared value
Land W 361,896 414,058 362,774 393,792
The officially declared value, which is used for government purposes, is not intended to represent fair value.
10. Intangible Assets
(a) Changes in intangible assets for the year ended December 31, 2010 were as follows:
(In millions of won)
Goodwill
Development
costs Software
Industrial
Rights Total
Net balance as of
January 1, 2010 W 588,395 40,777 35,460 3,334 667,966
Additions - 2,784 5,282 693 8,759
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
46
Other - - 5,135 - 5,135
Amortization (130,755) (16,210) (16,052) (610) (163,627)
Disposals - (3,735) (156) - (3,891)
Impairment loss - - - (546) (546)
Net balance as of
December 31, 2010 W 457,640 23,616 29,669 2,871 513,796
Changes in intangible assets for the year ended December 31, 2009 were as follows:
(In millions of won)
Goodwill Development
costs Software
Industrial
Rights Total
Net balance as of
January 1, 2009 W 15,285 36,110 30,589 4,471 86,455
Additions - 11,975 9,240 993 22,208
Increases due to the merger 653,772 7,074 8,093 968 669,907
Other - - 1,377 - 1,377
Amortization (80,662) (14,273) (13,672) (2,274) (110,881)
Disposals - (109) (167) (3) (279)
Impairment loss - - - (821) (821)
Net balance as of
December 31, 2009 W 588,395 40,777 35,460 3,334 667,966
(b) Research and development costs incurred for the years ended December 31, 2010 and 2009 were W274,388
million and W185,300 million, respectively.
11. Other Non-current Assets
Other non-current assets as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Deposits provided W 97,719 90,940
Guarantee deposits 6,658 13,612
104,377
104,552 W
12. Other Current Liabilities
Other current liabilities as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Withholding deposits W 15,567 18,002
Withholdings 5,848 4,233
Taxes withheld 500 10,198
Unearned revenues 888 1,099
22,803 33,532
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
47
W
13. Borrowings
(a) Short-term borrowings as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won)
Lender Annual interest rate 2010 2009
Shinhan Bank 3.03% W - 100,000
Samsung Securities Co., Ltd. 3.07% - 10,000
-
110,000 W
(b) Bonds as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won)
Lender Maturity
Annual
interest rate 2010 2009
The 141st Unsecured bond 2010.8.8 5.49% W - 100,000
The 142nd
Unsecured bond 2012.1.23 7.08% 200,000 200,000
The 143rd
Unsecured bond 2013.6.30 4.69% 100,000 -
300,000 300,000
Less current portion of bonds - (100,000)
Less discount (725) (627)
299,275
199,373 W
(c) Aggregate maturities of the Company‟s long-term debt as of December 31, 2010 are summarized as follows:
(In millions of won)
Periods Amount
2012.1.1~2012.12.31 W 200,000
2013.1.1~2013.12.31 100,000
300,000 W
13. Borrowings, Continued
(d) Current portion of bonds as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Current portion of bonds W - 100,000
Less discount - (99)
W - 99,901
14. Provision for warranties
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
48
Changes in provision for warranties for the years ended December 31, 2010 and 2009 were as follows:
(In millions of won) 2010 2009
Provision for warranties at beginning of the year W 61,573 20,371
Accrual for warranties 113,805 59,291
Increase due to the merger - 10,747
Decrease (54,470) (28,836)
Provision for warranties at end of the year 120,908 61,573
Current provision for warranties (85,157) (38,011)
Non-current provision for warranties W 35,751 23,562
The Company recognizes a provision for warranties based on past experience and projected costs during the coverage
period of one to five years, including costs due to quality assurance guarantees, returns, touch-ups and after service.
15. Retirement and Severance Benefits
Changes in retirement and severance benefits for the years ended December 31, 2010 and 2009 were as follows: (In millions of won) 2010 2009
Estimated retirement and severance benefits at beginning of year W 191,417 152,634
Accrual for retirement and severance benefits 60,718 32,448
Transfer from related companies 79 120
Increase due to the merger - 26,783
Payments (18,082) (20,568)
Estimated retirement and severance benefits at end of year 234,132 191,417
Transfer to National Pension Fund (415) (499)
Deposit for severance benefit insurance (164,639) (138,881)
Net balance at end of year W 69,078 52,037
15. Retirement and Severance Benefits, Continued
The Company maintains an employees‟ severance benefit trust arrangement with Kyobo Life Insurance Co., Ltd. and
others. Under this arrangement, the Company has made a deposit in the amount equal to 70.32 % and 72.55% of the
reserve balances of retirement and severance benefits as of December 31, 2010 and 2009, respectively. This deposit
is to be used to guarantee the required payments to the retirees and is accounted for as a reduction in the reserve
balance.
16. Assets and Liabilities Denominated in Foreign Currency
Assets and liabilities denominated in foreign currency as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won, thousands of USD) 2010 2009
Foreign
currency
Won
equivalent
Foreign
currency
Won
equivalent
Assets:
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
49
Cash and cash equivalents USD 10,613 W 12,087 USD 29,290 W 34,198
Accounts and notes receivable -
trade
USD 144,145 164,167 USD 116,727 136,291
Accounts and notes receivable -
other
USD 6,811 7,757 USD 293 342
USD 161,569 W 184,011 USD 146,310 W 170,831
Liabilities:
Accounts and notes payable -
trade
USD 102,666 W 116,926 USD 113,164 W 132,131
Accounts and notes payable -
other
USD 42,790 48,734 USD 20,753 24,231
USD 145,456 W 165,660 USD 133,917 W 156,362
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
50
17. Commitments and Contingencies
(a) As of December 31, 2010, the Company is provided with guarantees by Korea Exchange Bank and other
financial institutions, amounted to W6,936 million (2009: W9,463 million) and USD 1,171 thousand (2009: USD
1,023 thousand).
(b) As of December 31, 2010, the Company has provided payment guarantees amounted to W401,233 million (2009:
W358,281 million) and USD 1,217,162 thousand (2009: USD 1,291,725 thousand) for various borrowings and
business transactions of related parties.
(c) As of December 31, 2010, the outstanding balance of the accounts and notes receivable sold to financial
institutions with recourse but not yet matured amounted to W1,111,701 million.
(d) As of December 31, 2010, the Company has contracts for the development of new technology related to airbags
and others with 29 companies including Bosch, Dolby. In connection with these contracts, the Company
recognized royalties amounted to W36,332 million and W16,020 million for the years ended December 31, 2010
and 2009, respectively.
(e) As of December 31, 2010, the Company has been named as a defendant in legal actions. The aggregate amount
of domestic claims as a defendant amounted to approximately W60,757 million. The ultimate effect of these
cases cannot be presently determined. Accordingly, no provision for potential losses arising from these cases
has been reflected in the accompanying non-consolidated financial statements.
(f) As of December 31, 2010, the Company entered into bank overdraft agreements for borrowings up to W226,000
million with Korea Exchange Bank and others, and also entered into general term loan agreements up to
W150,000 million with Standard Chartered First Bank Korea Ltd. and others. The Company has
accommodation note discounting agreements of up to W19,000 million with Citibank Korea Inc. and others, and
has an agreement to open letters of Usance credit up to USD 55,000 thousand and W8,000 million with Shinhan
Bank and others. In addition, the Company has agreements with Korea Exchange Bank and others to open
documents against acceptance and documents against payment up to USD1,334,609 thousand and W81,000
million, respectively. Further, the Company has an agreement with Korea Exchange Bank and others for the
trade receivable-collateralized loans without recourse for up to W400,000 million and has an agreement with
Hana Bank and others for the buy-back card for up to W370,000 million.
(g) The Company has provided guarantees for Mobis North America, LLC(formerly, Ohio Module Manufacturing
Company with Daimler Chrysler) for the long-term auto parts supply and land-lease contracts as approved by the
Board of Directors on April 28, 2005.
(h) On January 21 and November 30, 2000, the Company acquired the auto parts for after-sales service divisions of
Hyundai Motor Company and KIA Motors Corporation, respectively. The assets and liabilities acquired from
Hyundai Motor Company amounted to W437,315 million and W40,892 million, respectively, and those from
KIA Motors Corporation amounted to W271,742 million and W6,937 million, respectively, with goodwill arising
from these transactions amounting to W50,000 million and W45,300 million, respectively. In addition, the
Company agreed to pay royalties of 10.0% of the annual ordinary income from the acquired business divisions
for ten years starting from 2000. The Company recognized royalties amounted to W30,539 million and
W82,422 million for the years ended December 31, 2010 and 2009, respectively. The royalty contract which
provides in the Hyundai Motor Company and KIA Motors Corporation was ended at January, 2010 and
November, 2010, respectively.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
51
17. Commitments and Contingencies, Continued
(i) The Company entered into the financial derivative contracts to manage the exposure to changes in currency
exchange rates with foreign currency receivables. The Company recognized realized gains and losses on
valuation of the financial derivatives amounted W2,791 million and W1,778 million, respectively, for the year
ended December 31, 2010, and recorded unrealized gains and losses on valuation of the financial derivatives
(before income tax effect) amounted W12,683 million and W3,438 million, respectively, as other comprehensive
income as of December 31, 2010
Details of financial derivative contracts are as follows:
(In thousands of foreign currency)
Currency Amount Strike Price in won Maturity
USD 464,793 1,135 ~ 1,275 January 28, 2011 ~ December 30, 2015
EUR 27,280 1,535 ~ 1,796 January 28, 2011 ~ December 28, 2012
JPY 9,610,974 13.57 ~ 15.04 January 31, 2011 ~ December 30, 2015
18. Stockholders’ Equity
(a) The Company‟s capital stock as of December 31, 2010 and 2009 are as follows:
2010 2009
Common stock
Preferred
stock Common stock Preferred stock
Authorized number of shares 275,000,000 25,000,000 275,000,000 25,000,000
Par value per share in won W 5,000 5,000 5,000 5,000
Issued number of shares 97,343,863 25,458 97,343,863 25,458
Capital stock in millions of won W 490,969 127 490,969 127
As approved by the Board of Directors on March 15, 2003, the Company retired 850,000 treasury shares
recording ₩18,813 million in gain. Accordingly, the number of shares issued has been decreased but the
amount of paid up capital stock has not been affected.
(b) The Company‟s capital stock and capital surplus for the years ended December 31, 2010 and 2009 are as follows:
(in millions of won) Common Stock Preferred Stock Additional
Paid-in
Capital
Number of
shares Amount
Number of
shares Amount
Balance at January 1, 2010 97,343,863 W 490,969 25,458 W 127 ₩ 1,282,845
Balance at December 31, 2010 97,343,863 W 490,969 25,458 W 127 ₩ 1,283,312
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
52
18. Stockholders’ Equity, Continued
(c) Capital surplus as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Additional paid-in capital W 1,283,312 1,282,845
Revaluation reserve 30,945 30,945
Other capital surplus 46,867 28,245
1,361,124
1,342,035 W
19. Capital Adjustments
Details of capital adjustments as of December 31, 2010 and 2009 were as follows:
(In millions of won) 2010 2009
Treasury stock W 130,896 144,309
Other capital adjustments 20,743 20,745
151,639
165,054 W
20. Retained Earnings
Retained earnings as of December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Legal reserve W 200,000 150,000
Voluntary reserve 5,677,066 4,284,775
Unappropriated retained earnings 2,388,336 1,561,609
8,265,402
5,996,384 W
(a) Legal reserve
The Korean Commercial Code requires the Company to appropriate a legal reserve in an amount equal to at least
10% of cash dividends for each accounting period until the reserve equals 50% of stated capital. The legal
reserve may be used to reduce a deficit or may be transferred to common stock in connection with a free issue of
shares.
(b) Voluntary Reserve
Under the Special Tax Treatment Control Law and others, the Company appropriates a certain portion of retained
earnings, pursuant to a shareholder resolution, as a voluntary reserve. This reserve may be reversed and
transferred to unappropriated retained earnings by the resolution of shareholders, and be distributed as dividends
after its reversal.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
53
21. Sales
Details of sales for the years ended December 31, 2010 and 2009 are summarized as follows:
(In millions of won) 2010 2009
Sales of merchandise (domestic) W 2,574,196 2,231,487
Sales of merchandise (overseas) 5,027,145 3,516,387
Sales of finished goods (domestic) 2,655,287 2,603,248
Sales of finished goods (overseas) 3,439,089 2,281,898
W 13,695,717 10,633,020
22. Cost of Sales
Details of cost of sales for the years ended December 31, 2010 and 2009 were as follows:
(In millions of won) 2010 2009
Inventories, beginning balance W 414,877 358,497
Cost of goods purchased or manufactured 10,587,687 8,154,329
Inventories, ending balance (483,666) (414,877)
W 10,518,898 8,097,949
23. Selling, General and Administrative Expenses
Details of selling, general and administrative expenses for the years ended December 31, 2010 and 2009 were as
follows:
(In millions of won) 2010 2009
Salaries W 234,915 220,686
Accrual for retirement and severance benefits 38,287 18,739
Other employee benefits 46,622 41,767
Service fees 113,301 154,941
Exporting expense 170,058 114,249
General development expense 274,388 185,300
Depreciation and amortization 185,851 137,548
Advertising 54,175 47,364
Transportation 56,564 50,035
Rent 15,800 14,683
Warrant expense 113,805 59,291
Supplies expense 5,421 5,226
Bad and doubtful debts - 4,443
Others 64,342 58,505
W 1,373,529 1,112,777
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
54
24. Income Taxes
(a) The Company was subject to income taxes on taxable income at the following normal tax rates.
Tax rate
Taxable income 2009 2010 2011 Thereafter
Up to W200 million 12.1% 11.0% 11.0% 11.0%
Over W200 million 24.2% 24.2% 24.2% 22.0%
(b) The components of income tax expense for the years ended December 31, 2010 and 2009 were as follows:
(In millions of won) 2010 2009
Current W 381,612 249,772
Deferred 248,413 170,151
Items credited (charged) directly to stockholders‟ equity (4,072) 28,211
625,953
448,134 Income tax expense W
(c) The income tax expense calculated by applying statutory tax rates to the Company‟s income before income taxes
for the year differs from the actual tax expense in the non-consolidated statement of income for the years ended
December 31, 2010 and 2009 for the following reasons:
(In millions of won) 2010 2009
Income before income taxes W 3,049,248 2,063,354
Tax calculated at statutory tax rate 737,898 499,332
Adjustment for :
Non-taxable income (4,509) (2,574)
Non-deductable expense 210 6,686
Tax credit (66,205) (47,935)
Others, net (41,441) (7,375)
(111,945) (51,198)
Income tax expense W 625,953 448,134
Effective tax rate % 20.53 21.72
(d) Deferred tax assets have been recognized as the Company has determined it is probable that future profits will be
available against which the Company can utilize the related benefit.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
55
24. Income Taxes, Continued
(e) Deferred taxes that were directly (charged) credited to shareholders‟ equity as of December 31, 2010 and 2009
are as follows:
(In millions of won) 2010 2009
Changes in retained earnings of equity-method Investments, net W 14,536 18,831
Unrealized gain (loss) on valuation of available-for-sale
securities 709 (7,133)
Unrealized gain on valuation of financial derivatives (1,092) (1,110)
Unrealized gain (loss) of equity method accounted investments (12,163) 17,623
Unrealized gain on sale of treasury stock (6,062) -
(4,072)
28,211 W
(f) In accordance with SKAS No. 16 Income Taxes, deferred tax amounts should be presented as a net current asset
or liability and a net non-current asset or liability. In addition, the Company is required to disclose gross
deferred tax assets (liabilities). As of December 31, 2010, details of gross deferred tax assets (liabilities) are as
follows:
(In millions of won) Temporary
differences at
December 31, 2010
Deferred tax assets (liabilities)
Current Non-current
Provision for warranties W 120,908 20,608 7,865
Allowance for valuation of inventories 22,726 5,500 -
Provision for retirement and severance benefits 163,478 - 35,965
Changes in retained earnings of equity-method
investments, net
159,093
- 41,621
Impairment losses on available-for-sale securities 37,542
- 8,259
Deposits for retirement and severance benefits (163,478) - (35,965)
Reserve for research and development (734,991) (1,452) (160,378)
Gain of equity method accounted investments, net
(3,673,647)
- (649,920)
Unrealized in net gain of equity method accounted
investments
(265,947)
- (56,733)
Goodwill (457,640) - -
Others 560,347 (3,020) 104,056
Net deferred tax asset (liability) W (4,231,609) 21,636 (705,230)
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
56
25. Earnings Per Share
(a) Basic earnings per share for the years ended December 31, 2010 and 2009 were as follows:
(In millions of won, except share information)
2010 2009
Net income W 2,423,295 1,615,220
Dividends on preferred stock (40) (33) Additional income available for dividends allocated to preferred
stock (608) (400)
Net income attributable to common stocks 2,422,647 1,614,787
Weighted average number of common shares outstanding(*) 95,330,130 90,656,309
Earnings per share W 25,413 17,812
(*) Weighted average number of common shares outstanding:
(In shares) 2010 2009
Weighted average number of common shares issued 97,343,863 92,667,836
Weighted average number of treasury stock (2,013,733) (2,011,527)
Weighted average number of common shares outstanding at
December 31 95,330,130 90,656,309
(b) Diluted earnings per share are not calculated on December 31, 2010 and 2009, because there are no diluted shares
as of December 31, 2010 and 2009.
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
57
26. Dividends
(a) Details of dividends for the years ended December 31, 2010 and 2009 were as follows:
(In millions of won, except share information)
2010 2009
Common
stock
Preferred
stock Total
Common
stock
Preferred
stock Total
Number of shares 95,400,544 25,458 95,426,002 95,201,413 25,458 95,226,871
Par value per share W 5,000 5,000 - 5,000 5,000 -
Dividends as a
percentage of par
value 30.00% 31.00% - 25.00% 26.00% -
Dividend per share 1,500 1,550 - 1,250 1,300 -
Cash dividends W 143,100 40 143,140 119,002 33 119,035
(b) Dividends as a percentage of net income and par value for the years ended December 31, 2010 and 2009 were as
follows:
(In millions of won) 2010 2009
Dividend amount W 143,140 119,035
Net income W 2,423,295 1,615,220
Dividends as a percentage of net income 5.91% 7.37%
(c) Dividend yield ratio for the years ended December 31, 2010 and 2009 was as follows:
(In won) 2010 2009
Common
stock
Preferred
stock
Common
stock
Preferred
stock
Dividend per share W 1,500 1,550 1,250 1,300
Market price as of year end W 284,500 186,500 171,000 85,100
Dividend yield ratio 0.53% 0.83% 0.73% 1.53%
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
58
27. Comprehensive Income
Comprehensive income for the years ended December 31, 2010 and 2009 was as follows:
(In millions of won) 2010 2009
Net income W 2,423,295 1,615,220
Unrealized in net gain (loss) on valuation of available-for-sale
securities, net of tax (2,515) 25,288
Unrealized in net gain on valuation of financial derivative assets,
net of tax 3,524 3,519
Adjustments of equity in equity method accounted investments,
net of tax 22,663 (84,036)
2,446,967
1,559,991 Comprehensive income W
28. Non-cash Investing and Financing Activities
Significant non-cash investing and financing activities for the years ended December 31, 2010 and 2009 were as
follows:
(In millions of won) 2010 2009
Disposal of treasury stock W 19,952 -
Changes in accumulated other comprehensive income on valuation
of equity method accounted investments 22,663 84,036
Changes in capital surplus on valuation of equity method accounted
investments 40 20,742
Changes in retained earnings on valuation of equity method
accounted investments 35,242 72,491
Transfer from construction-in-progress to property, plant and
equipment W 146,470 81,213
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
59
29. Employee Welfare and Others
In order to enhance the welfare of employees, the Company provides fringe benefits to its employees, such as meal
allowance and insurance, among others. Employee benefits expensed by the Company amounted to W84,609
million and W67,129 million for the years ended December 31, 2010 and 2009, respectively. In addition, the
Company contributed donations amounted to W16,076 million and W11,357 million for the years ended December
2010 and 2009, respectively.
30. Value Added Information
Details of accounts included in the computation of value added for the years ended December 31, 2010 and 2009 are
as follows:
(In millions of won) 2010 2009
Salaries and wages W 455,307 388,521
Accrual for retirement and severance benefits 60,718 32,448
Other employee benefits 84,709 67,129
Rent 19,352 18,201
Depreciation 140,007 119,426
Amortization 163,627 111,005
Taxes and dues 7,815 6,049
931,535
742,779 W
31. Segment Information
The Company has two reportable operating segments – auto parts business, mainly the manufacturing parts and
modules for car production and after-sales services. The following table provides information for each operating
segment as of and for the years ended December 31, 2010 and 2009.
(In millions of won) 2010 2009
Auto parts
After sales
services Total Auto parts
After sales
services Total
Sales W 9,844,179 3,851,538 13,695,717 7,193,911 3,439,109 10,633,020
Operating income 863,455 939,835 1,803,290 551,837 870,457 1,422,294
Tangible and
intangible assets 1,423,301 504,741 1,928,042 1,525,128 505,552 2,030,680
Depreciation W 274,853 28,781 303,634 183,498 46,935 230,433
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
60
32. Merger
On June 25, 2009, the Company merged with Hyundai Autonet Co., Ltd. which is engaged in the auto parts business,
mainly on manufacturing and sales of auto parts. Acquired assets, liabilities and good will which resulted from the
merger were as follows:
(In millions of won) Amount
Assets
Current assets W 383,457
Non-current assets 360,283
743,740
Liabilities
Current liabilities 326,013
Long-term liabilities 10,829
336,842
Net assets 406,898
Unidentifiable asset deducted (8,916)
Identifiable net assets 397,982
Less considerations given
Common stock (issued 9,752,856 shares in W110,500, par value W5,000) 1,077,691
Treasury stock (25,937)
Total consideration 1,051,754
Goodwill W 653,772
33. Results of Operations for the Last Interim Period
(In millions of won, except earnings per share) 2010 2009
4th Quarter 4th Quarter
Revenue W 3,652,712 3,180,773
Operating income 482,821 349,837
Net income for the period 591,611 474,986
Earnings per share W 6,200 5,022
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
61
34. Date of Authorization for Issue
The 2010 financial statements were authorized for issue on January 27, 2011, at the Board of Directors Meeting.
35. Subsequent Event
On January 14, 2011, the Company which is a part of Hyundai Motor Group Consortium, signed a memorandum of
understanding with the approval of the stockholders‟ council of Hyundai Engineering & Construction Co., Ltd.
(„Hyundai E&C”) for the acquisition of shares of Hyundai E&C.
36. Planning and Adoption of K-IFRS (International Financial Reporting Standards)
(a) The Company plans to issue financial statements prepared in accordance with K-IFRS from 2011. The
Company organized a Task Force Team to perform preliminary analysis of the effects of K-IFRS adoption and
establish accounting systems to apply the new accounting treatments, and trained its relevant personnel internally
and externally. The Company has completed the design and implementation of its individual and integrated
systems for preparing financial statements under K-IFRS, and carries out K-IFRS training for domestic and
overseas subsidiaries. The details of the K-IFRS Adoption Plan to date are as follows:
Time frame Activities
April 2008 - Selection of an external advisor
May-November 2008 - Analysis of GAAP differences and establishment of global accounting
standards based on K-IFRS
May-July 2009 - Establish standards for K-IFRS transition
August-December 2009 - Individual system modification and integrated system development
Ongoing - Calculate K-IFRS financial information
- K-IFRS related on-site training, web-based training, and group training
sessions
36. Planning and Adoption of K-IFRS (International Financial Reporting Standards), Continued
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
62
(b) Differences between accounting under K-IFRS and under K-GAAP expected to have a material effect on the
Company are as follows:
Area Current K-GAAP K-IFRS
Goodwill Goodwill is amortized over the useful
life of the asset
The Company tests goodwill for
impairment annually
Retirement
obligations
The Company recognizes a liability equal
to the amount which would be payable
if all eligible employees left at the end
of the reporting period
The Company calculates its present
benefit obligation based on an
actuarial method and recognizes a
provision amounting to the present
value of the obligation
Classification of
club
memberships
The Company classifies club
memberships in non-current assets as
guarantees
The Company classifies club
memberships as intangible assets with
an unlimited useful life
Elimination of
financial assets
Assignments of receivables are treated as
sales transactions
The assignment of receivables with
recourse is treated as a borrowing
Capitalization of
borrowing costs
All borrowing expenses are treated as
period expenses
Borrowing costs that are directly related
to a qualifying asset, which takes a
substantial period to get ready for the
intended purpose, are capitalized.
Scope of
consolidation
Under the Act on External Audit of Stock
Companies, subsidiaries with total
assets of less than W10 billion are
exempted from consolidation
requirements
Without regard to the size of a
subsidiary, any entity which the
Company controls in fact is included
in the scope of consolidation
(c) Changes in scope of consolidation
Consolidated Subsidiaries under K-GAAP
Consolidated Subsidiaries under K-IFRS
IHL Co., Ltd. IHL Co., Ltd.
Mobis America Inc. Mobis America Inc.
Mobis Alabama, LLC Mobis Alabama, LLC
Mobis Parts America, LLC Mobis Parts America, LLC
Mobis North America, LLC Mobis North America, LLC
Mobis Brasil Fabricacao De Auto Pecas Ltda Mobis Brasil Fabricacao De Auto Pecas Ltda
America Auto Parts Inc. America Auto Parts Inc.
Ohio Module Manufacturing Co., LLC Ohio Module Manufacturing Co., LLC
Mobis Parts Europe N.V. Mobis Parts Europe N.V.
Mobis Module CIS, LLC Mobis Module CIS, LLC
Mobis Parts CIS, LLC Mobis Parts CIS, LLC
Mobis Automotive Czech s.r.o. Mobis Automotive Czech s.r.o.
Mobis Slovakia, s.r.o. Mobis Slovakia, s.r.o.
Hyundai Motor (Shanghai) Co., Ltd. Hyundai Motor (Shanghai) Co., Ltd.
Shanghai Hyundai Mobis Automotive Parts Co.,
Ltd.
Shanghai Hyundai Mobis Automotive Parts Co.,
Ltd.
Wuxi Mobis Automotive Parts Co., Ltd. Wuxi Mobis Automotive Parts Co., Ltd.
Jiangsu Mobis Automotive Parts Co., Ltd. Jiangsu Mobis Automotive Parts Co., Ltd.
36. Planning and Adoption of K-IFRS (International Financial Reporting Standards), Continued
(c) Changes in scope of consolidation, continued
HYUNDAI MOBIS Co., Ltd.
Notes to Non-consolidated Financial Statements
December 31, 2010 and 2009
63
Consolidated Subsidiaries under K-GAAP
Consolidated Subsidiaries under K-IFRS
Beijing Hyundai Mobis Automotive Parts Co.,
Ltd.
Beijing Hyundai Mobis Automotive Parts Co.,
Ltd.
Beijing Mobis Chonche Automotive Parts Co.,
Ltd.
Beijing Mobis Chonche Automotive Parts Co.,
Ltd.
Tianjin Mobis Automotive Parts Co., Ltd. Tianjin Mobis Automotive Parts Co., Ltd.
Hyundai Mobis (Hongkong) Co., Limited Hyundai Mobis (Hongkong) Co., Limited
Mobis Parts Middle East FZE Mobis Parts Middle East FZE
Mobis Auto Parts Middle East Egypt Mobis Auto Parts Middle East Egypt
Mobis India, Ltd. Mobis India, Ltd.
(*) Mobis India Research and Development Private
Limited
Mobis Parts Australia PTY., Ltd. Mobis Parts Australia PTY., Ltd.
(*) Under Art. 1-3 par. 2 of the Presidential Decree enacting the Act on External Audit of Stock Companies,
Mobis India Research and Development Private Limited was excluded from consolidation, however under
K-IFRS it is a consolidated subsidiary
64
Independent Auditors’ Review Report on Internal Accounting Control System
English translation of a Report Originally Issued in Korean
To the President of
HYUNDAI MOBIS Co., Ltd.
We have reviewed the accompanying Report on the Operations of Internal Accounting Control System (“IACS”) of
HYUNDAI MOBIS Co., Ltd. (the “Company”) as of December 31, 2010. The Company's management is
responsible for designing and maintaining effective IACS and for its assessment of the effectiveness of IACS. Our
responsibility is to review management's assessment and issue a report based on our review. In the accompanying
report of management‟s assessment of IACS, the Company‟s management stated: “Based on the assessment on the
operations of the IACS, the Company‟s IACS has been designed and is operating effectively as of December 31, 2010,
in all material respects, in accordance with the IACS Framework issued by the Internal Accounting Control System
Operation Committee.”
We conducted our review in accordance with IACS Review Standards, issued by the Korean Institute of Certified
Public Accountants. Those standards require that we plan and perform the review to obtain assurance of a level less
than that of an audit as to whether Report on the Operations of Internal Accounting Control System is free of material
misstatement. Our review consists principally of obtaining an understanding of the Company‟s IACS, inquiries of
company personnel about the details of the report, and tracing to related documents we considered necessary in the
circumstances. We have not performed an audit and, accordingly, we do not express an audit opinion.
A company's IACS is a process designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted
accounting principles. Because of its inherent limitations, however, IACS may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may
deteriorate.
Based on our review, nothing has come to our attention that Report on the Operations of Internal Accounting Control
System as of December 31, 2010 is not prepared in all material respects, in accordance with IACS Framework issued
by the Internal Accounting Control System Operation Committee.
This report applies to the Company‟s IACS in existence as of December 31, 2010. We did not review the Company‟s
IACS subsequent to December 31, 2010. This report has been prepared for Korean regulatory purposes, pursuant to
the External Audit Law, and may not be appropriate for other purposes or for other users.
February 22, 2011
Notice to Readers
This report is annexed in relation to the audit of the non-consolidated financial statements as of December 31, 2010
and the review of internal accounting control system pursuant to Article 2-3 of the Act on External Audit for Stock
Companies of the Republic of Korea.
65
Report on the Operations of Internal Accounting Control System
To the Board of Directors and Audit Committee of
HYUNDAI MOBIS Co., Ltd.:
1. I, as the Internal Accounting Control Officer (“IACO”) of HYUNDAI MOBIS Co., Ltd. (the “Company”), have
assessed the status of the design and operations of the Company‟s internal accounting control system (“IACS”) as
of December 31, 2010 and the Company‟s management including IACO is responsible for designing and
operating IACS.
2. Major examinations for the operations of the Company‟s IACS.
1) Report on result of the operations of IACS.
2) Check and finalize the financial statements for the year ended December 31, 2010.
3. Results of the Examination
1) The major examinations above properly express all subjects that the Company has to include or reflect in
accordance with IACS standards of the Acts on External Audit for Stock Companies in Korea and manages
public announcement certifying system to ensure the accuracy and propriety of public announcement.
2) Based on its assessment of the operations of the IACS, the Company‟s IACS has been designed and is
operating effectively as of December 31, 2010, in all material respects, in accordance with the IACS standards
established by the IACS Operations Committee.
3) In order to ensure that the Company takes the appropriate steps in adopting K-IFRS, the Company has
educated the employees and CFOs of subsidiaries and established accounting systems to apply the new
accounting treatments in 2010.
January 27, 2011
Choi Byung-Chul, Internal Accounting Control Officer
Chung Suk-Soo, Chief Executive Officer and President