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HG Audit Report / Information 2019

Nov 12, 2019

52182_rns_2019-11-12_57965790-6def-4a46-8daa-675761e016f3.pdf

Audit Report / Information

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Holiday Garden International Ltd.

Parent Company Only financial Report and Independent Accountant’s Report

2019 and 2018 (Stock code: 2702)

Address: No.279, Liouhe 2nd Rd., Cianjin Dist., Kaohsiung City Phone: (07) 241-0123

The independent auditors’ report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and consolidated financial statements, the Chinese version shall prevail. 

~1~

Holiday Garden International Ltd. and Subsidiaries

Parent Company Only Financial Report and Independent Accountant's Report of 2019 and 2018

Table of Contents

Item
1. Cover
2. Table of contents
3. Independent accountant’s report
4. Parent company only balance sheets
5. Parent company only statements of comprehensive income
6. Parent company only statements of changes in equity
7. Parent company only statements of cash flows
8. Notes of parent company only financial statements
(1) Company milestones and scope of business
(2) Date and procedure of approval of the financial report
(3) Applicability of newly issued and revised standards and interpretations
(4) Summary of significant accounting policies
(5) Critical accounting judgments, estimates and key sources of assumption
uncertainty
(6) Details of significant accounts
(7) Transactions with related parties
(8) Collateralized assets
(9) Significant contingent liabilities and unrecognized contractual commitments
(10) Significant casualty losses		 Page/No./Index
1
2 ~ 3
4 ~ 10
11 ~ 12
13
14
15 ~ 16
17 ~ 54
17
17
17 ~ 19
19 ~ 28
28 ~ 29
29 ~ 45
46
46
47
47		 
~2~
Item
(11) Major events after the reporting period
(12) Other
(13) Additional disclosure
(14) Segment information
9. Schedules of significant accounts
Statement of cash and cash equivalents
Statement of changes in investment property accounted for using the equity
method
Statement of property, plants, and equipment cost
Statement of changes in accumulated depreciation of property
and equipment
Statement of short-term borrowings
Statement of short-term notes and bills payable
Statement of long-term borrowings
Statement of operating revenue
Statement of operating cost
Statements of operating expenses
Statement of other income
Statement of other gains and losses
Statement of financial cost
Aggregation of employee benefit, depreciation, and amortization expenses
by function		 Page/No./Index
47
47 ~ 53
54
54
Statement 1
Statement 2
Note 6(5)
Note 4(13)(5)
And 6(5)
Statement 3
Statement 4
Statement 5
Note 6(15)
Statement 6
Statement 7
Note 6(16)
Note 6(17)
Note 6(18)
Statement 8		 
~3~

Independent Accountant’s Report (2020.) Tsai Shen Pao Tzu No. 19004556

Holiday Garden International Ltd ：

Opinion

We have audited the following financial statements of Holiday Garden International Ltd.: The parent company only balance sheets of December 31, 2019and 2018, the parent company only statements of comprehensive income of January 1 to December 31 of 2019 and 2018, the parent company only statements of changes in equity, the parent company only statements of cash flows, and the notes to the parent company only financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying parent company only financial statements present fairly, in all material aspects, the financial position of Holiday Garden International Ltd. as at December 31, 2019 and 2018 and its financial performance and cash flows for the period from January 1 to December 31 of 2019 and 2018 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for opinion

We conducted the audit in accordance with the Rules Governing Auditing and Certification of Financial Statements by Certified Public Accountants and the generally accepted auditing standards in the Republic of China. Our responsibilities under those rules and standards are described in the section of the responsibilities of accountants auditing parent company only financial statements. Personnel of our accounting firm subject to the independent requirements have complied with the code of professional ethics of certified public accountants of the Republic of China, stayed fully independent of Holiday Garden Hotel Co., Ltd, and fulfilled other responsibilities in accordance with the code. We believe that we have obtained adequate and appropriate audit evidence to form the basis of our audit opinion.

Key audit matters

Key audit matters refer to the most significant matters, according to our professional judgment, in the 2019 parent company only financial statements of Holiday Garden 

~4~

International Ltd. These matters were addressed during the audit of the overall parent company only financial statements and in the formation of our opinion. We do not express our opinion on these matters separately.

We determine the following key audit matters of the parent company only financial statements of 2019 of the Holiday Garden International Ltd.:

Evaluation of investment impairment accounted for using the equity method ：

Investment which adopting to Equity method —Business Mergers and Acquisitions

Description

Adopted to Equity method of accounting policy, please refer to parent company financial report note4(12).Description of investment which adopting to equity method of accounting policy,please refer to parent company financial report note6(4).Subsidiary of Holiday Garden International Ltd. Acquired Hotel Hyatt Place Emeryville with 2,045,468,000 NTD on April 12, 2019 which adopting accounting policy. Due to the significant estimation of management and purchase price allocation, the mergers and acquisition amount is material of this year, we recognized the mergers and acquisitions of subsidiary as one of major audit program of this year .

Corresponding audit program

  1. We have implemented the following audit program corresponding to the aforementioned audit matter.

  2. We have learned to obtain an understanding of internal control of Holiday Garden International Ltd. and subsidiary , inspect the related document of board of directors, and make sure the investment has been executed with the relevant procedures.

  3. We have confirmed the purchase consideration, review the mergers and acquisition contract, and confirm price payment instrument.

4. We have obtained the purchase price allocation, evaluated the independence of external specialist, reviewed the information of the report. The auditor evaluated the valuation method and assumptions used in report to assess the purchase price allocation .

Adopting to Equity method “ impairment evaluation of investment”

Description

For accounting policies on investments accounted for using the equity method, please refer to 

~5~

Note 4(12) of the parent company only financial statements. For accounting estimation and assumption uncertainty of evaluation of investment impairment accounted for using the equity method, please refer to Note 5(2) of the parent company only financial statements. For investment using the equity method, please refer to Note 6(4) of the parent company only financial statements.

The carrying amount of intangible assets as of December 31, 2019 of subsidiaries of Holiday Garden International Ltd. is NT$750,664,000, accounting for 9.82% of the total amount of consolidated assets. The booming of a wide variety of hotels and accommodations and the fierce competition in the hospitality industry in recent years have prompted management to treat each subsidiary as an independent and the smallest cash generating unit in the impairment evaluation of intangible assets and to use the estimated future cash flows of each subsidiary and an appropriate discount rate for discount to measure the recoverable amount of each cash generating unit and to use this information for evaluating the impairment of intangible assets.

The aforementioned use of future cash flow estimation for measuring the recoverable amount of a cash generating unit may exert a significant impact on the measurement of the recoverable amount because the estimation is based on numerous assumptions, including the discount rate and the financial forecast for the next five years, which may lead to subjective judgment and a high level of uncertainty. Therefore, we have chosen intangible assets impairment evaluation to be a key audit matter of this year.

Corresponding audit program

We have implemented the following audit program corresponding to the aforementioned audit matter. ：

  1. We worked on understanding and evaluated management's operating procedure for estimating the subsidiaries’ future cash flows. We also verified that their cash flows for the next fiver years are consistent with the business plan approved by the Board of Directors.

  2. We discussed specific actions in the business plan with management and evaluated management’s intent and ability for implementing the business plan by acquiring information related to the actual implementation of management’s business plan in the past.

3. We evaluated the reasonableness of various parameters and material assumptions adopted, including the discount rates. 

~6~

Responsibilities of management and those charged with governance for the parent company only financial statements

The responsibilities of management is to prepare appropriately stated parent company only financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers. Management is also responsible for maintaining necessary internal control relevant to the preparation of the parent company only financial statements to ensure that the parent company only financial statements are free from material 。 misstatement by fraud or error

Management when preparing parent company only financial statements is also responsible for evaluating Holiday Garden International Ltd.’s ability to continue as a going concern, disclosing relevant matters, and using the going concern basis of accounting unless management intends to liquidate Holiday Garden International Ltd., to cease the operations, 。 or to liquidate or to have no feasible alternatives but to do so

Account's responsibilities for the audit of parent company only financial statements

The objectives of accounts for auditing parent company only financial statements are to obtain reasonable assurance about whether the parent company only financial statements as a whole are free from any material misstatement due to fraud or error and to issue an accountant’s report accordingly. Reasonable assurance refers to a high level of assurance, but there is no guarantee that accountants performing in accordance with the generally accepted auditing standards of the Republic of China can detect any material misstatement from the parent company only financial statements. Misstatements may arise from fraud or errors. A misstated dollar amount, individually or in the aggregate, that could be reasonable predicted to influence the economic decision of the user of the parent company only financial statements can be viewed as material. 

~7~

In accordance with the generally accepted auditing standards of the Republic of China, we exercised professional judgment and maintained professional skepticism throughout the audit. We also performed the following tasks ：

  1. We identified and assessed the risks of material misstatement of the parent company only financial statements, whether due to fraud or errors, designed and performed audit procedures according to those risks, and obtained audit evidence that can sufficiently and appropriately form the basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for the one resulting from error because fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

  2. We obtained an understanding of internal control relevant to the audit in order to design audit procedures suitable for the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Holiday Garden International Ltd.’s internal control.

  3. We evaluated the appropriateness of accounting policies adopted and the reasonableness of accounting estimates and related disclosures made by management.

  4. We concluded on the appropriateness of management’s use of the going concern basis of accounting and whether a material uncertainty exists related to events or conditions that may cast significant doubt on Holiday Garden International Ltd.’s ability to continue as a going concern based on the audit evidence we have obtained. If we conclude that a material uncertainty exists, we will need to draw attention in our accountant’s report to the related disclosures in the parent company only financial statements or to modify our opinion if such disclosures are inadequate. Our conclusions are based on the audit evidence obtained up to the date of this accountant’s report. However, future events or conditions may cause Holiday Garden International Ltd. to cease to continue as a going concern.

  5. We evaluated the overall presentation, structure and contents of the parent company only financial statements, including the attached notes, and whether the parent company on financial statements represent the underlying transactions and events in a fair manner.

  6. We obtained sufficient and appropriate audit evidence regarding the financial information of entities within Holiday Garden International Ltd. to express an opinion on the parent company only financial statements. We are responsible for the direction, supervision, and performance of the audit of the parent company and are responsible 

~8~

for our audit opinion.

We have communicated with those charged with governance regarding the planned scope and the timing of the audit as well as material audit findings (including significant internal control shortcomings identified in the audit).

We have also provided those charged with governance the statement that the personnel of our accounting firm subject to the requirements of independence have complied with the requirements of independence of the code of professional ethics of certified public accountants of the Republic of China and communicate with those charged with governance relationships and other matters that may influence our independence (including related preventive measures). 

~9~

We determined the key audit matters of the parent company only financial statements of 2018 of Holiday Garden International Ltd. according to matters communicated with those charged with governance. We described these matters in the accountant’s report, unless the laws and regulations prohibit such disclosure or under rare condition that we decide not to communicate a given matter because the negative impact from such communication may override its public benefits under reasonable assumption.

PwC Taiwan

Independent accountants

Liao A-shen

Wu Chien-chih

Financial Supervisory Commission

Approval certificate No.: Chin Kuan Cheng Shen Tzu

No. 1010015969

Former Financial Supervisory Commission of Executive Yuan

Approval certificate No.: Chin Kuan Cheng Shen Tzu No. 1030027246

March 19, 2020 

~10~
Holiday Garden International Ltd. Holiday Garden International Ltd. Holiday Garden International Ltd. Holiday Garden International Ltd. Holiday Garden International Ltd.
Parent Company Only Balance Sheet
December 31 of 2019 and 2018
Unit: NT$1,000
D e c e m b e r 3 1 , 2 0 1 9 D e c e m b e r 3 1 , 2 0 1 8
Assets Notes A m
o		 u n
t		 % A m o u n
t		 %
Current assets
1100 Cash and cash equivalents 6(1) $ 91,968 3 $ 30,969 1
1136 Net notes receivable 8 998,986 29 589,226 18
1150 Net accounts receivable 6(2) 938 - 400 -
1170 Other accounts receivable 6(2) 6,428 - 5,757 -
1200 Tax assets 2,874 - 3,355 -
1220 Inventories - - 1,051 -
130X Advance payments 6(3) 993 - 332 -
1410 Other financial assets - current 2,306 - 2,188 -
1479 Other current assets - others 241 - 93 -
11XX Total current assets 1,104,734 32 633,371 19
Non-current assets
1550 Investments accounted for using the 6(4)
equity method 1,654,003 47 1,868,627 57
1600 Property, plants, and equipment 6(5) and 8 686,263 19 712,968 22
1755 Right-of-use asset 6(6) 1,957 - - -
1840 Deferred tax assets 6(21) 56,921 2 43,745 2
1920 Guarantee deposits paid 378 - 1,087 -
15XX Total non-current assets 2,399,522 68 2,626,427 81
1XXX Total Assets $ 3,504,256 100 $ 3,259,798 100 
(Next page)

~11~

Holiday Garden International Ltd. Parent Company Only Balance Sheet December 31 of 2019 and 2018

Unit: NT$1,000 Unit: NT$1,000
De c e mb er 3 1 ,2 0 19 De c e mb er 31 ,2 0 18
Liabilities and equity Notes A m o u n
t		 % A m o u n
t		 %
Current liabilities
2100 Short-term borrowings 6(7) and 8 $ 1,530,000 44 $ 1,204,500 37
2110 Short-term notes and bills payable 6(8) 130,000 4 130,000 4
2130 Contractual liabilities - current 6(15) 8,196 - 6,967 -
2150 Notes payable 322 - 1,366 -
2170 Accounts payable 2,519 - 5,441 -
2200 Other accounts payable 15,663 - 12,917 1
2230 Income tax liabilities 1,370 - - -
2280 Unearned receipts 586 - - -
2320 Long-term liabilities - current portion 6(9) and 8 52,196 2 49,019 2
2399 Other current liabilities - others 2,529 - 1,699 -
21XX Total current liabilities 1,743,381 50 1,411,909 44
Non-current liabilities
2540 Long-term borrowings 6(9) and 8 56,010 1 90,273 3
2570 Deferred income tax liabilities 6(21) 285,764 8 280,216 8
2580 Lease obligation -non current 1,389 - - -
2610 Long-term notes and accounts 6(5)
payable 127,577 4 127,577 4
2645 Guarantee deposits received 870 - 755 -
25XX Total non-current liabilities 471,610 13 498,821 15
2XXX Total liabilities 2,214,991 63 1,910,730 59
Equity
Capital stock 6(11)(13)
3110 Common share capital 1,104,856 32 1,023,015 31
Capital surplus 6(12)
3200 Capital surplus 2,169 - 2,169 -
Retained earnings 6(13)
3310 Legal reserve 82,561 2 61,295 2
3320 Special reserve 71,161 2 71,161 2
3350 Retained earnings 87,509 3 215,768 7
Other equity
3400 Other equity 6(14) ( 58,991) ( 2) ( 24,340) ( 1)
3XXX Total equity
Major events after the reporting
period 1,289,265 37 1,349,068 41
3X2X Total liabilities and equity $ 3,504,256 100 $ 3,259,798 100 
Please refer to notes of parent company only financial statements provided at the end, which is part of this parent company
only financial report.

Chairperson of the Board: Chen Hai-niManager: Chen Hai-ni

Accounting Director: Yu Su-ling

~12~

Holiday Garden International Ltd. Parent Company Only Statement of Comprehensive Income January 1 to December 31 of 2019 and 2018

Item Unit: NT$1,000
(Except earnings (loss) per share, which is in NT$1.00)
2
0
1
9 2
0
1
8
Notes
A
m
o
u
n
t
%
A
m
o
u
n
t
%
6(15)
$
153,657
100 $
102,640
100
6(3)(19)
(
51,762) (
34) (
53,566) (
52)
101,895
66
49,074
48
6(19)(20)
(
106,647 ) (
69 ) (
93,135) (
91)
12(2)
(
125)
-
-
-
(
106,772) (
69) (
93,135) (
91)
(
4,877) (
3) (
44,061) (
43)
6(16)
24,155
16
13,069
13
6(17)
(
31,595 ) (
21 )
14,803
14
6(18)
(
21,375 ) (
14 ) (
17,176) (
17)
6(4)
34,605
23
320,153
312
5,790
4
330,849
322
913
1
286,788
279
6(21)
(
5,605) (
4) (
74,126) (
72)
($
4,692) (
3) $
212,662
207
6(14)
($
43,314 ) (
28 ) $
55,805
54
6(21)
8,663
5 (
7,334) (
7)
($
34,651) (
23) $
48,471
47
($
39,343) (
26) $
261,133
254
6(22)
($
0.04) $
1.92
($
0.04) $
1.92
4000Operating revenue
5000Operating cost
5900Operating gross profit
Operating expenses
6200
Management expense
6450
Expected credit impairment loss
6000
Total operating expense
6900Operating loss
Nonoperating income and
7010
Other income
7020
Other gains and losses
7050
Financial cost
7070
Share of profit or loss of
7000
Total non-operating income
7900Net profit (loss) before tax
7950
Income tax (expense) benefits
8200Net profit (loss)
Other comprehensive income
Items may be subsequently
8361
Exchange differences on
8399
Income tax of items that may be
8300Other comprehensive income
8500Total comprehensive income
Earnings (loss) per share
9750
Basic
9850
dilution		 
Please refer to notes of parent company only financial statements provided at the end, which is part of this
parent company only financial report.

Chairperson of the Board: Chen Hai-ni Manager: Chen Hai-ni

Accounting Director : Yu Su-ling

~13~

Holiday Garden International Ltd. Parent Company Only Statements of Changes in Equity January 1 to December 31 of 2019 and 2018

Unit: NT$1,000
N o t e s
2018
Balance, January 1, 2018
Effects of retrospective application
and retrospective restatement
6(14)
Balance after restatement, January 1,
Net income
Other comprehensive income
6(14)
Total comprehensive income
Balance, December 31, 2018
2019
Balance, January 1, 2019
Net loss
Other comprehensive income
6(14)
Total comprehensive income
2018 Appropriation and distribution of
retained earnings:
Legal reserve
Stock dividends
6(13)
Cash dividends
6(13)
Balance, December 31, 2019		 Share capital
- c o m m o n
s
t
o
c
k

A d d i t i o n a l
p a i d I n
c a p i t a l -
in excess of
p
a
r

A d d i t i o n a l
p a i d I n
c a p i t a l -
in excess of
p
a
r		 R e t a i n e d e a r n i n g s n i n g s O t h e r e q u i t y



T


Legal reserve		 S p e c i a l
r e s e r v e
R e
e a		 t a i n e d
r n i n g s		 E x c h a n g e
differences
o
n
translation
o f f o r e i g n
f i n a n c i a l
s t a t e m e n t s

U n r e a l i z e d
gain or loss
o
n
available-for
-
s
a
l
e
f i n a n c i a l
a s s e t s
$
2,169
-		 $
806
2,300
2,169 3,106
-
-		 212,662
-
- 212,662
$
2,169		 $ 215,768
$
2,169
$ 215,768
-
-
-
-
-
-
$
2,169		 
Please refer to notes of parent company only financial statements provided at the end, which is part of this parent company only financial report.

Manager: Chen Hai-ni

Accounting Director: Yu
Su-ling

Chairperson of the Board: Chen Hai-ni

~14~

Holiday Garden Hotel Co., Ltd. Parent Company Only Cash Flow Statement January 1 to December 31 of 2019 and 2018

Cash flows from operating activities
Net profit (losses) before tax
Adjustments:
Revenue/expenses
Provision for bad debt expense

Depreciation expenses

Interest expense

Interest income

Share of profit of subsidiaries, associates,
joint ventures accounted for using equity
method

Loss on disposal and write-off of property,
plants, and equipment

Changes in assets/liabilities related to operating
activities
Net changes in assets related to operating
activities
Notes receivable
Accounts receivable
Inventories
Advance payments
Other current assets - others
Net changes in liabilities related to operating
activities
Contractual liabilities - current
Notes payable
Accounts payable
Other accounts payable
Unearned receipts
Operating cash inflows (outflows)
Interests received
Interests paid
Income taxes paid
Net cash outflows from operating
activities
Cash flows from investment activities
Other financial assets - increased flows
Acquisition of investments accounted for using
the equity method

Cash returned from capital reduction of
investments accounted for using the equity
method

Acquisition of property, plants, and equipment

Disposal of property, plants, and equipment
Increase (decrease) in guarantee deposits paid
Net cash outflows from investment
activities
Cash flows from fundraising activities
Increase in short-term borrowings

Decrease in short-term borrowings

Lease capital repayment

Long-term borrowings

Payments of long-term borrowings

Increase in guarantee deposits received		 Unit: NT$1,000
Notes
2019
2018
$
913$
286,788
12(2)
125
-
6(5)(6)(19)
28,836
29,591
6(18)
21,375
17,176
6(16)
(
21,077 ) (
10,713 )
6(4)
(
34,605 ) (
320,153 )
6(17)
(
62 )
-
(
538 )
883
(
796 ) (
1,745 )
(
661 )
507
(
118 )
476
(
148 ) (
45 )
1,229(
2,878 )
(
1,044 ) (
547 )
(
2,922 )
158
2,758(
4,782 )
830
-
(
5,905 ) (
5,284 )
21,558
10,551
(
21,387 ) (
17,070 )
(
2,149 ) (
1,051 )
(
7,883 ) (
12,854 )
(
409,760 ) (
147,784 )
6(4)
(
400,000 ) (
40,000 )
6(4)
605,915
122,420
6(24)
(
1,973 ) (
11,098 )
495
-
709
800
(
204,614 ) (
75,662 )
6(25)
1,660,000
1,517,500
6(25)
(
1,334,500 ) (
1,372,977 )
6(25)
(
573 )
-
6(25)
20,000
-
6(25)
(
51,086 ) (
48,996 )
115
-

Please refer to notes of parent company only financial statements provided at the end, which is part of this parent company only financial report. 。 

Chairperson of the Board: Chen Hai-ni Manager: Chen Hai-ni
~15~

Accounting Director : Yu Su-ling

Holiday Garden Hotel Co., Ltd. Parent Company Only Cash Flow Statement January 1 to December 31 of 2019 and 2018

Distribution of cash dividends

Net cash inflows from fundraising
activities
Increase in cash and cash equivalents
Cash and cash equivalents, beginning of the period
Cash and cash equivalents, end of the period
 Notes
6(13)

6(1)
6(1)		 2019
(
20,460 )
273,496
60,999
30,969
$
91,968		 Unit: NT$1,000
2018
-

95,527
7,011
23,958
$
30,969

Please refer to notes of parent company only financial statements provided at the end, which is part of this parent company only financial report. 。 

Chairperson of the Board: Chen Hai-ni Manager: Chen Hai-ni
~16~

Accounting Director : Yu Su-ling

Holiday Garden International Ltd. 2019 and 2018

Notes for Parent Company Only Financial Statements

Unit: NT$1,000 (Unless otherwise noted) )

1. Company milestones

Holiday Garden International Ltd. (the “Company”) was established in July 1959, and the primary scope of business includes tourism hotels and attached restaurants and swimming pools. The Company has been a Taiwan Stock Exchange Corporation 。 (TSEC) listed company since February, 1965

2. Date and procedure of approval of the financial report

This parent company only financial report has been approved and issued by the 。 Board of Directors on May 20, 2020

3. Applicability of newly issued and revised standards and interpretations

(1) Impacts from adopting the latest, amended and revised International Financial Reporting Standards (IFRS) approved by the Financial Supervisory Commission (ROC)

The following table summarizes the latest, amended and revised IFRS standards and interpretations applicable for 2018 approved by the Financial Supervisory Commission:

and interpretations applicable for 2018 approved by the
Commission:		 Financial Supervisor
Newly issued/revised/amended standards and interpretations
Amendments to IFRS 9 “Prepayment Features with Negative
Compensation”
IFRS 16 “Leases”
Amendments to IAS 19 “Plan Amendment, Curtailment or Settlement”
Amendments to IAS 28 “Long-term Interests in Associates and Joint
Ventures”
Interpretations to IFRS 23 Uncertainty over Income Tax Treatments
Annual Improvements to 2015 - 2017 Cycle		 Effective date of
issuance by International

Accounting Standards
Board
January 1, 2019
January 1, 2019
January 1, 2019
January 1, 2019
January 1, 2019
January 1, 2019

Except the following matters, the Company has determined that the standards and interpretations above has no material effect on the Company’s financial conditions and performance.

IFRS 16 “Leases” 

~17~

  • 1.Replacing IAS 17 “Lease and the related interpretations and interpretative bulletins” by IFRS 16 “Leases” This standard requires the lessee to recognize the right-of-use asset and lease liabilities (except short-term leases of no more than 12 months or leases of underlying assets of low value. For the leaser, except for requiring more disclosure, the accounting treatment remains the same, i.e., according to whether it is an operating lease or a finance lease.

  • 2.The Company treats the lease contract of the lessee in accordance with IFRS 16. Because the restatement of financial statements of the prior period (“modified retrospective”) is not used, the right of use assets and lease 。

  • liabilities are both increased to $2,537 on January 1, 2019

3. The Company will elect to apply the guidance of IFRS 16 and apply the following practical expedients:

  • (1) Contracts identified as containing a lease under IAS 17 and IFRIC 4 will not be reassessed and will be accounted for in accordance with the transitional provisions under IFRS 16.

  • (2) The Company will apply a single discount rate to a portfolio of leases with reasonably similar characteristics to measure lease liabilities.

  • (3) The Company will account for those leases for which the lease term ends on or before December 31, 2019 as short-term leases ， The amount recognized of the2019 contract:$663.

  • (4) The company will exclude initial direct costs from the measurement of right-of-use assets. weighted average interest rate:1.68 %

(3)The Company will account for those leases for which the lease term ends
on or before December 31, 2019 as short-term leases，The amount
recognized of the2019 contract:$663.
(4)The company will exclude initial direct costs from the measurement of
right-of-use assets. weighted average interest rate:1.68%		 (3)The Company will account for those leases for which the lease term ends
on or before December 31, 2019 as short-term leases，The amount
recognized of the2019 contract:$663.
(4)The company will exclude initial direct costs from the measurement of
right-of-use assets. weighted average interest rate:1.68%
(5)According to IAS17 ,the lease liabilities will be measured at the present
value of the remaining lease payments by using the incremental
borrowing rate on January 1,2019：
Adopted the IAS17 “Operating Lease” $ 3,515
Less: Exemption of short-term lease ( 663)
Leases of low-value assets ( 217)
Adopted IFRS16 “Total amount of Lease obligation contract” $ 2,635
First applicability of the incremental borrowing rate of interest 1.68%
Adopted to lease obligations recognized by IFRS16 from January 1,2020 $ 2,537 
~18~

(2)Impacts from adopting the latest, amended and revised International Financial Reporting Standards (IFRS) approved by the Financial Supervisory Commission (ROC)

The following table summarizes the latest, amended and revised IFRS standards and interpretations applicable for 2020 approved by the Financial Supervisory Commission ：

Effective date of issuance by International Accounting Standards Newly issued/revised/amended standards and interpretations Board Amendments to IFRS 2 and IAS8 “Disclosure Initiative -Definition of January 1, 2020 materiality” Amendments to IFRS3 “Definition of a Business” January 1, 2020 January 1, 2020 Amendments to IFRS9,IAS39 and IFRS7 “Interest Index Change”

The Company has determined that the above standards and interpretations have no material effect on the Company’s financial conditions and performance.

(3)Impacts from adopting the latest, amended and revised International Financial Reporting Standards (IFRS) approved by the Financial Supervisory Commission (ROC) ：

Effective date of issuance by International Accounting Standards Board Newly issued/revised/amended standards and interpretations Amendments to IFRS 10 and IAS 28 “ Sale or Contribution of Assets To be decided by IASB between an investor and its Associate or Joint Venture” IFRS 17 “Insurance Contracts” January 1, 2021 Amendments to IAS1 「 Classifications of current or January 1, 2022 Non-current liabilities 」

The Company has determined that the above standards and interpretations have no material effect on the Company’s financial conditions and performance.

4. Summary of significant accounting policies

The major accounting policies adopted for preparing these parent company financial statements are described below. Unless otherwise specified, these policies are consistently applied in the entire period reported. 

~19~

(1) Statement of compliance

This parent company only financial report is prepared in accordance with

Regulations Governing Preparation of Financial Reports by Securities Issuers.

(2) Basis of preparation

  • 1.This parent company only financial report is prepared based on the historical cost .

2. Some material accounting estimation are used in preparing financial statements based on IFRS and IAS approved by the Financial Supervisory Commission and the related interpretations, and interpretative bulletins (IFRSs). When applying the Company's accounting policies, management also needs to make judgment, which involves accounts of a high level of decision-making and complexity or accounts associated with material assumption and estimation in the parent company only financial report. Please refer to Not 5 attached.

(3) Foreign currency translation

Accounts listed in the Company’s parent company only financial report are based on the money (i.e., functional currency) of the primary economic environment. This parent company only financial report is presented in New Taiwanese Dollars (NT$), which is the Company’s functional and presentation currency.

  1. Foreign currency transaction and balance

  2. (1) For foreign currency transactions, spot rate of exchange on the trading day or the measurement date is used for functional currency translation, and the resulting exchange differences are recognized in profit or loss.

  3. (2) Foreign currency monetary assets and liabilities balance is adjusted based on the spot exchange rate on the balance sheet date, and the resulting exchange differences are recognized in profit or loss.

  4. (3) Foreign currency monetary assets and liabilities balance is measured at fair value through profit or loss and adjusted using the spot exchange rate on the balance sheet. The resulting exchange differences are recognized in profit or loss. For foreign currency monetary assets and liabilities balance that is measured at fair value through other comprehensive income, it is adjusted using the the spot exchange rate on the balance sheet day. The resulting exchange differences are recognized in the account of other comprehensive income. As for those not measured at fair value, they are measured at the historical exchange rate on the initial transaction day.

  5. (4)All exchange gains or losses are recognized in “other gains and losses” in the statement of comprehensive income. 

~20~

2. Translation of foreign financial statements 

  - `(1)` All the group entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows: ：

     - `A.` The assets and liabilities of each balance sheet presented are translated at the closing rate of that balancesheet date ；

     - `B.` The income and expenses of each statement of comprehensive income are translated using the current average exchange rate, and

     - `C.` Exchange differences generated from translation are recognized in other comprehensive profit/loss `.`

  - `(2)` When a foreign operation is partially disposed of or sold, it will be recognized in the accumulated exchange differences of other comprehensive income and reclassified to the non-controlling interests of that specific foreign operating entity. However, when the Company loses the control of a foreign operating subsidiary, even if the Company still keeps partial equity of this former subsidiary, it is treated as disposing all equity of this foreign operating subsidiary.

  • (4) Classification of current and non-current assets and liabilities

  • Assets that meet one of the following criteria are classified as current assets ：

    • (1)Assets expected to be realized in the normal operating cycle or intended to be sold or consumed.

    • (2)Liabilities held primarily for transaction purposes.

    • (3)Liabilities that are to be paid off within 12 months after the balance sheet date 。

    • (4)Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Classification of liabilities for which, at the option of the counterparty, repayment is required for the issue of equity instruments is not affected

    • The Company classifies all liabilities that do not meet the above criteria as non-current.

  • Liabilities that meet one of the following criteria are classified as current liabilities ：

    • (1)Liabilities expected to be paid off in the normal operating cycle.

    • (2)Liabilities held primarily for transaction purposes. 

~21~

  • (3)Liabilities that are to be paid off within 12 months after the balance sheet date.

  • (4)Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Classification of liabilities for which, at the option of the counterparty, repayment is required for the issue of equity instruments is not affected.

The Company classifies all liabilities that do not meet the above criteria as non-current.

  • (5) Cash equivalents

Cash equivalents refer to short-term, highly liquid investments, which can be readily converted to fixed cash and has an insignificant risk of value change. Time deposits are classified as cash equivalents because they meet the above definition and their holding satisfies short-term cash commitments for operation .

(6) Financial assets at amortized cost

1. Finanacial assets at cost are corresponding to the following conditions ：

  • (1) The business model of the company which owns such financial assets is to collect the contractual cash flows as purpose.

  • (2)The contractual cash flows of specific financial asset under consideration are on account of repayment of principal and interest and they occur on specified dates.

2. The Group uses trade day accounting for financial assets measured at amortized cost through profit or loss and satisfying the accounting practice.

3. The Group measured transaction cost of initial recognition which reported at fair value .Using the effective interest method and is recognized in profit and loss which are recognized in profit and loss when the asset is derecognized.

(7)Accounts and notes receivable

1. This term refers to accounts and notes granting an unconditional right to receive consideration in exchange for transferred goods or rendered services in accordance with the contract.

2. For short-term accounts receivable without interest payment, they are measured at the original invoice amount because of insignificant effect of discounting. 

~22~

  • (8) Impairment loss on financial assets

  • The Company assesses the financial assets measured at amortized cost based on all reasonable and evidence-supported information (including those on a prospective basis) at each balance sheet date. For financial assets exposed to significantly increasing credit risk after the initial recognition, the Company measures the loss allowance for 12-month expected credit losses. For financial assets exposed to significantly increasing credit risk since the initial recognition, the Company measures the loss allowance for the financial assets at an amount equal to the lifetime expected credit losses. For accounts receivable that does not contain a significant financing component, the Company measures the loss allowance at an amount equal to lifetime expected credit losses for trade receivable .

(9)Derecognization of financial assets

The Company derecognizes a financial asset if one of the following conditions is met ：

1. The contractual rights to receive cash flows from the financial asset expire.

  1. The contractual rights to receive cash flows from the financial asset are transferred, and almost all risks and rewards of the ownership of the financial asset have been transferred.

  2. The contractual rights to receive cash flows from the financial asset are transferred, and the control over the financial asset is not kept.

(10) Operating lease (lessor)

Payments received under operating leases, net of any incentives given to the lessees, are recognized in profit or loss on a straight-line basis over the term of the lease.

(11) Inventories

Inventories are measured at the lower of cost and net realizable value, and the cost is determined by the weighted average method. The item by item method is adopted to compare between the cost and the net realizable value to decide which one is lower. The net realizable value refers to the estimated sale price in the normal course of business, less relevant variable selling expenses. 

~23~

(12) Investments/subsidiaries accounted for using the equity method

  • 1.Subsidiaries refer to entities controlled by the Company (including structure entities). When the Company is exposed to variable rewards from participating in that entity or entitled to rights to said variable rewards and the Company has the power and ability to affect said rewards of that entity, the Company controls said entity.

  • 2.The unrealized profit or loss generated from transactions between the Company and the subsidiary has been eliminated. Necessary adjustment of accounting policies of the subsidiary has been made so it is consistent with policies of the Company.

  • 3.The Company recognizes the share of profit or loss after acquiring the subsidiary in profit or loss, and as for the share of other comprehensive income after the acquisition, it is recognized in other comprehensive income. If the Company’s recognized share of impairments of a subsidiary is equal to or more than its equity of the subsidiary, the Company shall continue to recognize the loss in proportion to the Company’s percentage of ownership in the subsidiary.

  • 4.In accordance with the Regulations Governing Preparation of Financial Reports by Securities Issuers, the profit or loss and other comprehensive income of the parent company only financial report should be the same as the share of the profit or loss and other comprehensive income belonging to the owner of the parent company in the consolidated financial report. The owner's equity in the parent company only financial report, should be the same as the equity belonging to the owner of the parent company in the consolidated financial report.

(13) Property, plants, and equipment

  1. Property, plants, and equipment are carried at acquisition cost, and the related

  2. interests during the construction period are capitalized.

  3. Subsequent cost may become a carrying amount of the assets or be recognized as a single asset only if future economic benefits associated with this item may flow into the Company, and the cost of this item can be reliably measured. The carrying amount of the replaced part should be derecognized. All other repair and maintenance expenses are recognized in profit or loss when they are incurred.

  4. Property, plants, and equipment are measured subsequently using the cost model. Except land, which is not depreciated, all others are depreciated by the straight-line method according to the estimated useful lives. Significant 

~24~

  • components of property, plants, and equipment should be depreciated separately.

  • The Company reviews each asset’s residual value, useful life, and depreciation method at the end of each fiscal year, and if the expected residual value and useful lives are different from the previous estimation or if the expected consumption type of future economic benefits of a given asset has any material change, the stipulation on changes in accounting estimates from IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors is adopted for treatment. The useful lives of assets are listed below ：

Buildings and structures 5 to 55 years Utility equipment 5 to 15 years Business facilities/equipment 5 to 25 years Other facilities 5 to 8 years

  • (14)Lease transaction of Lessee － Right-of-use asset/Lease obligations 2019 applicable

  • Leased assets are recognized as right-of-use assets and lease liabilities at the date they become available for use by the Group. The lease payments are recognized as an expense over the lease term using the straight-line basis when a lease contract is a short-term lease or a lease of a low-value subject asset

2. Recognized the lease obligations as the present value of incremental borrowing rate of interest which lease started .The lease benefit included fixed benefit ,and deducted any Incentive . Provided the interest during the lease by measuring the cost after amortization whit adopting interest method . The group will reevaluate lease obligations and adjust the right-of-use assets when the lease term or benefit changed by amending non-contract .

3. Right-of-use assets are recognized as cost at the beginning of the lease .The cost includes the original measured amount of the lease liabilities. The useful life of right-of-use assets or the expiry date of the lease term will be provided to be depreciation. The right-if-use asset will adjust any remeasurement of the lease liabilities which is reassessed.

  • (15) Operating lease (lessor)

Applicable in 2018

Payments given under operating leases, net of any incentives from the lessor, are recognized in profit or loss on a straight-line basis over the term of the lease. 

~25~
  • (16) Non-financial asset impairments

The Company estimates the recoverable amount for assets showing impairments at the balance sheet date, and when the recoverable amount of an asset is lower than the book value, it is recognized in impairment losses. The recoverable amount refers to fair value less costs to sell or value in use, whichever is lower. Aside from goodwill, when an asset impairment loss recognized the year before disappears or decreases, reverse the impairment loss, but the increase to the carrying amount of the asset due to the reversal cannot exceed the said asset’s book value without impairment recognized and net of amortization or depreciation.

  • (17) Loans

It refers to proceeds from long-term and short-term bank borrowings. The Group recognizes borrowings initially at fair value, net of transaction costs incurred, and subsequently any difference between the proceeds (net of transaction costs) and the redemption value is measured at amortized cost using the effective interest method and recognized as interest expense in profit or loss during the circulating period .

(18) Accounts and notes payable

  1. Accounts and notes payable are liabilities for purchases of raw materials, goods or services resulting from operating and non-operating activities.

  2. Short-term notes and accounts payable without bearing interest are measured at initial invoice amount because of an insignificant effect of discounting .

(19)Derecognization of financial liabilities

The Company will derecognize a financial liability when the contracted obligations 。 are fulfilled, canceled, or expired

(20)Offset of financial assets and liabilities

Financial assets and liabilities can be offset only if there is the legally enforceable right to do so and the intent is to to settle on a net basis or to realize the asset and settle the liability simultaneously and the net amount has to be stated in the balance sheet.

(21) Employee benefits

  1. Short-term employee benefits

Short-term employee benefits are measured at undiscounted amount of prospective payment and are recognized as expenses when related services are rendered. 

~26~
  1. Pensions

Defined contribution plans (DCP) 

  - For defined contribution plans, the contribution amounts for pension are recognized in the current pension expense when they are due on the accrual basis. Prepaid contributions are recognized as assets to the extent of refundable cash or reduction in future payment.

3. Employee compensation and director and supervisor remuneration Employee compensation and director and supervisor remuneration are legal or constructive obligations and are recognized as expenses and liabilities when the amount can be reasonably estimated. Deviation between estimated and actual distribution amount shall be treated in accordance with changes in accounting estimates. For stock distribution as employee remunerations, the closing price of the day prior to the resolution of the Board of Directors shall be the basis for 。

calculating the number of shares

  • (22) Income tax

  • 1.Income tax expense Income tax is recognized either in the income statement or in equity if it relates to items that are recognized in other comprehensive income or directly in equity.

  • 2.The Company calculates the current income tax using tax rates enacted or substantively enacted by the balance sheet date of the country generating the taxable income from operations Management periodically evaluates the condition of income tax filing in accordance with appropriate income tax related laws and regulations and if applicable shall estimate income tax liabilities based on the expected tax payments to the tax authorities. There is an additional tax of unappropriated earnings according to the Income Tax Act, and after the earning distribution is approved at the shareholders’ meeting held in the year following the year the earnings are generated, the tax expense of undistributed earnings shall be recognized based on the actual condition of 。

  • earning distribution.

3. For deferred tax, the balance sheet liability method is adopted, and it is recognized using the temporary differences between the tax bases of assets and liabilities and their carrying amounts in the balance sheet. Deferred tax is not recognized if it is originated from the initial recognition of assets or liabilities in transactions (business merger excluded) and neither accounting profits nor taxable income (or tax losses) was affected at the time of the transaction. Deferred tax is determined using tax rates (and tax laws) enacted or 

~27~

substantively enacted by the balance sheet date, and the tax rates (and tax laws) used are the ones expected to be applicable when realizing related deferred tax assets or repaying related deferred tax liabilities .

4. Deferred tax assets are recognized to the extent when they are highly likely to be used to offset future taxable income, and unrecognized and already recognized deferred income tax assets should be re-evaluated on each balance sheet date.

5. Recognized income tax assets and liabilities of the reporting period are offset only if there is the legally enforceable right to do so and the intent is to settle on a net basis or to realize the asset and settle the liability simultaneously. Deferred income tax assets and liabilities are offset only if there is the legally enforceable right to do so and the deferred income tax assets and liabilities related to income taxes are levied by the same taxation authority on either the same taxable entity or different taxable entities, but each entity intends to either settle on a net basis or to realize the assets and settle the liabilities simultaneously.

(23) Dividend distribution

  • Dividends distribution among the Company's shareholders are recognized in the financial report when the Company’s shareholders’ meeting resolved that dividends are to be paid; cash dividend distribution is recognized as liabilities, while share dividend distribution is recognized as stock dividend to be distributed 。

  • and be converted to common stock on the base day of issuance of new stock

(24) Revenue recognition

  • 1.The Company provides accommodations and foodservice related products, and the sales revenue is recognized at the time services are rendered or products are delivered to customers.

  • 2 Sales revenue is recognized as the contractual price net of the estimated price.

  • 3.Accounts receivable are recognized at the time services are rendered or products are delivered to customers. Because at that time point the Company has the unconditional right to the contractual price, the consideration can be collected 。

  • from customers after the time point

5.Material accounting judgments, estimates and key sources of assumption uncertainty

When preparing this parent company only financial report, the Company's management has applied its judgment on determining the accounting policies used and made accounting estimates and assumptions based on reasonable expectation of future 

~28~

events according to the conditions at the balance sheet date. Material accounting estimates and assumptions may be significantly different from the actual results, and therefore, experiences and other factors are continuously evaluated and adjusted. These estimations and assumptions expose the carrying amounts of assets and liabilities to the risk of material adjustment in the next fiscal year. Uncertainty of material accounting judgments, estimates, and assumptions are described below ：

(1) Critical judgments adopted by accounting policies

The Company has made no critical judgments adopted by accounting policies.

(2) Critical accounting estimates and assumptions

  • Evaluation of investment impairment accounted for using the equity method

  • When there are signs of impairments indicating that a given investment accounted for using the equity method may have been impaired to cause the carrying amount unrecoverable, the Company immediately evaluates the impairment of said investment. The Company evaluates the recoverable amount based on the discounted value of the future cash flows the Company is entitled to from the investee and analyzes the reasonableness of related assumptions .

6. Details of significant accounts

(1) Cash and cash equivalents

Cash:
Cash in treasury and working funds
Checking deposits and demand deposits
Cash equivalents:
Time deposits:		 December 31, 2019
$ 1,485
29,517

31,002
60,966

$ 91,968
 December 31, 2018
$ 760
20,209
20,969
10,000
$ 30,969

  • 1.The Company places cash and deposits with multiple reputable banks and financial institutions to disperse credit risk, and therefore, the probability of occurrence of default is very low.

  • The Company does not pledge its cash and cash equivalents to others. 

~29~

(2)Net amount of accounts and notes receivable

December 31, 2019 December 31, 2018 December 31, 2018
Notes receivable $ 938 $ 400
Less: Allowance for doubtful accounts -
 -
$ 938
 $ 400
Accounts receivable
Less: Allowance for doubtful accounts $ 6,553 $ 5,757
Notes receivable ( 125)
 -
Less: Allowance for doubtful accounts $ 6,428
 $ 5,757
Aging analysis of accounts and notes receivable：
December 31, 2019 December 31, 2018
Not past due and past due for 1 to 30 days
$ 6,336		 $ 5,591
Past due for 31 to 90 days 1,035 497
Past due for more than 94 days 120
69
$ 7,491
$		 6,157

1. Aging analysis of accounts and notes receivable ：

The above is the aging analysis based on past due days.

2. The balance of receivable(included note receivable) between the contract and company on December 31 , 2019 ,December 31, 2018 and January 1,2018 are $7,491,$6,157 and $5,295.

3. The Company does not t hold any collateral as security.

4. Without considering the collaterals held or other credit enhancement, the Company's maximum amount of credit risk exposure of the most representing notes receivable for December 31, 2019 and 2018 was NT$938 and NT$400 respectively. The Company's maximum amount of credit risk exposure of the most representing accounts receivable for December 31, 2019 and 2018 was NT$6,428 and NT$5,757 respectively.

5. For information related to credit risk of accounts and notes receivable, please 。

refer to 12(2)

(3)Inventories

ventories
Foods and non-alcoholic and
alcoholic beverages
Foods and non-alcoholic and
alcoholic beverages		 December 31, 2019
Carrying amount
$ 993

Carrying amount
$ 332
Cost
$ 993
 Allowance for price
decline in inventories

$-
December 31, 2018
Cost
$ 332
 Allowance for price
decline in inventories
$-

The inventory cost that the Company recognized as expenses for 2019 and 2018 

~30~

was $17,629 and $20,079 respectively .

(4) Investments accounted for using the equity method

1. Details of investment accounted for using the equity method are as follows:

January 1
Increase investments accounted for using
the equity method
Share of investment income accounted
for using the equity method
Capital stock return of investments accounted
for using the equity method
Changes in other equity
December 31
Holiday Garden International Ltd.
Holiday Garden Development Co., Ltd.		 2019
$ 1,868,627
400,000
34,605

( 605,915)
( 43,314)
$ 1,654,003
December 31, 2019
$ 1,603,478
50,525
$ 1,654,003		 2018
$ 1,575,089
40,000
320,153
( 122,420)
55,805
$ 1,868,627
December 31, 2018
$ 1,814,419
54,208
$ 1,868,627

2. Information of the Company’s subsidiaries are presented in Note 4(3) of the 。

Company's 2019 consolidated financial statements.

(5)Property, plants, and equipment

1. The book value of property, plants, and equipment is presented below ：

Land
Buildings and structures
Utility equipment
Business facilities/equipment
Other facilities		 December 31, 2019
$ 481,493
181,294
7,850
14,785
841

$ 686,263
 December 31, 2018
$ 481,493
203,260
9,226
17,678
1,311
$ 712,968		 
~31~

2. Changes in property, plants, and equipment are as follows ：

Cost
Land
Buildings and structures
Utility equipment
Business facilities/equipment
Other facilities		 2019 2019
Closing balance
$ 481,493
618,173
32,288
42,047
3,965
$ 1,177,966
Opening balance
$ 481,493
617,874
31,320
47,182
3,965
$ 1,181,834		 Addition
$ -
299
968
706
-
$ 1,973
 Reduction
$ -
-
-
( 5,841)
-
($ 5,841)

使用滑鼠雙擊這裡以編輯新增的表格段。

2018

Cost
Land
Buildings and structures
Utility equipment
Business facilities/equipment
Other facilities		 Opening balance
$ 481,493
617,273
31,320
37,757
3,808
$ 1,171,651		 Addition
$ -
601
-
9,425
157
$ 10,183		 Reduction
$ -
-
-
-
-
$-		 Closing balance
$ 481,493
617,874
31,320
47,182
3,965
$ 1,181,834		 
~32~

2019

2019
Accumulated depreciation and impairment
 Opening balance
$ 414,614
22,094
29,504
2,654
$ 468,866		 Addition
$ 22,265
2,344
3,166
470
$ 28,245
 Reduction
$ -
-
( 5,408)
-
($ 5,408)		 Closing balance
$ 436,879
24,438
27,262
3,124
$ 491,703


Buildings and structures
Utility equipment
Business facilities/equipment
Other facilities

2018

2018
Accumulated depreciation and impairment
 Opening balance
$ 390,841
19,547
26,810
2,077
$ 439,275		 Addition
$ 23,773
2,547
2,694
577
$ 29,591		 Reduction
$ -
-
-
-
$-		 Closing balance
$ 414,614
22,094
29,504
2,654
$ 468,866


Buildings and structures
Utility equipment
Business facilities/equipment
Other facilities

3. In accordance with Kaohsiung Urban Development Kuei Tzu No. 10234984600 correspondence on October 28, 2013, the Company applied for making payment by installments for converting governmental land to commercial land in the land conversion urban plan, and the total amount to be paid is NT$212,628. The Company made the first installment payment of NT$85,051, and the remaining amount was paid by the second and third installment payments of $63,788 and $63,789 respectively. These payments had to be made before applying for the construction permit or the issuing of the change of use permit, and they were recognized in 2013 (The balance at December 31, 2019 and 2018 was stated as long-term notes and accounts payable of $127,577).

4. There was no borrowing cost capitalization of the Company’s property, plants, and equipment in 2019 and 2018.

  1. For information on using property, plants, and equipment for guarantees, please refer to Note 8. 
~33~

－ (6)Lease transaction Lessee

Applicable in 2019

  • 1.The lease assets of the company included buildings and multifunctional office machine, and the terms between 3 to 5 years.The contract included different provisions and requirements, and no other restriction except using the assets as the guarantee to debit and credit.

  • 2.The operating equipment of company included part of buildings and official vehicles and there terms are not over 12 months, they all belong to leases of low-value assets.

3. Information of the carrying amounts of right-of-use assets and recognized depreciation expense as the below:

Building
Equipment(copy machine)		 December 31 ,2019

Carrying amount
1,861
96

$ 1,957
 2019
Depreciation expense
519
72
$ 591

  • 4.The right-of-use of the company increase to $11 in 2019.

  • 5.Information of loss and gains related to lease transaction as the followings:

Affected project of current loss and gain
Lease obligation interest
Expense of short-term lease
Expense of leases of low-value assets		 2019
$ 39
1,139
135

6.The total cash flow amount of the company in 2019 is $1,886.

  • (7) Short-term borrowings
hort-term borrowings
Types of borrowings
Unsecured loans from banks
Secured loans from banks
Range of interest rates		 December 31, 2019
$ 75,000
1,455,000
$ 1,530,000
1.10%~1.90%		 December 31, 2018

$ 145,500
1,059,000
$ 1,204,500
1.10%~1.30%
  1. The Company's bank loans are recognized in the interest expense of profit or 。

loss. Please see Note 6(18)

2. For collaterals of the above-mentioned short-term borrowings, please refer to Note 8 。 

~34~

(8) Short-term notes and bills payable

hort-term notes and bills payable
Commercial paper payable
Range of interest rates		 December 31, 2019
$ 130,000
0.60%~0.96%		 December 31, 2018

$ 130,000
0.58%~0.76%

Bills finance companies and other financial institutions provide guarantees for the above-mentioned short-term notes and bills payable.

- (9) Long term borrowings

(9)Long-term borrowings
Types of
borrowings
Period of borrowing and repayment
method
Long-term
Borrowings
from banks
Unsecured
loans
The term of borrowing is from
September 18, 2012 to
September 18, 2022. The interest is
paid on a monthly basis. Starting
from December 2015, the loan is
repaid quarterly for 28 installments.
Secured loans
The term of borrowing is from June
4, 2014 to June 4, 2021. The interest
is paid on a monthly base. Starting
from June 4, 2015, the loan is repaid
quarterly for 25 installments
Secured loans
The term of borrowing is from June
1, 2015 to June 1, 2022. The interest
is paid on a monthly base. Starting
from June 1, 2016, the loan is repaid
quarterly for 25 installments.
Unsecured
loans
The term of borrowing is from July 5
2016 to July 5, 2019.
The interest is paid on a monthly
basis.
Less: Current portion of long-term loans payable		 Range of interest
Collateral
None
Note:
Note:
None		 December 31,
2019
$ 22,978
38,895
28,000
18,333

rates
1.75%
1.90%
1.70%

1.38%

108,206
( 52,196)

$ 56,010		 
~35~
Types of
borrowings
Period of borrowing and
repayment method
Long-term borrowings
from banks
Unsecured loans
The term of borrowing is from
September 18, 2012 to September
18, 2022. The interest is paid on a
monthly basis. Starting from
December 2015, the loan is repaid
quarterly for 28 installments.
Secured loans
The borrowing period is from
June 4, 2014 to June 4, 2021. The
interest is paid on a monthly base.
Starting from June 4, 2015, the
loan is repaid quarterly for 25
installments.
Secured loans
The borrowing period is from
June 1, 2015 to June 1, 2022. The
interest is paid on a monthly base.
Starting from June 1, 2016, the
loans are repaid quarterly for 25
installments.
Unsecured loans
The term of borrowing is from
July 5 2016 to July 5, 2019.
The interest is paid on a monthly
basis.
Less: Current portion of long-term loans payable		 Range
of
interest		 Collateral

None
Note:
Note:
None		 December 31, 2018
$ 31,378
64,825
39,200
3,889
139,292
( 49,019)
$ 90,273
rates



1.75%

1.90%

1.69%
1.38%

1. The Company's bank loans are recognized in the interest expense of income. Please see Note 6(18).

2. Note: For collaterals of the above-mentioned long-term borrowings, please refer to Note 8.

(10) Pensions

1. In accordance with the Labor Pension Act, the Company set up the defined contribution plan for retirement for employees who are the citizens of ROC starting from July 1, 2005. According to employee’s option for the labor pension system stipulated by the Labor Pension Act, the Company each month contributes to the Labor Pension Fund at the rate of 6% of employees’ monthly wages. Payments of employees pension are made to each employee’s personal pension account and employees can choose to receive the principal and the cumulative gains by monthly pension payments or a 。

lump sum pension payment 

~36~

2. In accordance with the above-mentioned pension plan, the Company recognized a pension cost of NT$2,424 and NT$2,308 in 2019 and 2018 respectively.

  • (11) Capital stock

1. As of December 31, 2019, the Company’s authorized capital was NT$1,500,000, and the paid-in capital was NT$1,104,856,000 which was divided into 110,486, 000 shares, with a par value of NT$10 per share. The Company’s issued shares are fully paid-up.

Reconciliation of the Company’s common stock outstanding at the beginning and the end of the reporting period is as follows:

January 1
Capital increase by retained earnings
December 31		 2019

102,302
8,184

110,486
 Unit: 1,000 shares
2018
102,302
-
102,302

2. The Company’s capital increase out of earnings was approved at the shareholders’ meeting on June 19, 2019 and a total of 8,184,000 new shares were issued from the earning of $81,841. This capital increase has been approved by the Financial Supervisory Commission on July 26, 2019 and the change has been registered.

(12) Capital surplus

In accordance with the Company Act, the capital surplus from shares issued in excess of par and donations may be used to offset a deficit, or when the company has no deficit,

the capital surplus can then be distributed as cash dividends or new stock among shareholders in proportion to their original shareholdings. Moreover, according to the Securities and Exchange Act, for the above-mentioned capital increase by capital surplus, the total amount each year cannot exceed 10% of the paid-in capital. The Company cannot use capital surplus for capital increase unless the reserve is not enough to cover the capital losses.

(13) Retained earnings

1. In accordance with the Company's Articles of Incorporation, if there are earnings upon the Company's final account at the end of the year, the Company shall first pay profit-seeking enterprise income tax, make up the deficits for the preceding years and then set aside a legal reserve of 10% of the reminder (not applicable if the legal reserve has reached the total capital amount of the Company). After appropriating or reversing a special reserve in accordance with laws, the balance and the unallocated accumulated 

~37~

earnings from the previous years are the accumulated, distributable earnings for shareholders, for which the Board of Directors shall propose an earning distribution plan to be resolved at the shareholders’ meeting. More than 10% of the aforementioned allocable earnings are provided for dividends and shareholders’ bonuses, and the cash dividends should be no less than 10% of the total amount of shareholders’ dividends and bonuses

2. The legal reserve cannot be used for purposes other than offsetting the company’s deficits or providing new stock or cash to shareholders in proportion to their original shareholding. If the reserve is used for distributing new stock or cash, it has to be more than 25% of the Company’s paid-in capital.

  • 3.(1) The Company shall first set aside a special reserve from the debit balance on the “other equity” item at the balance sheet date before distributing earnings, and later when this debit balance on the “other equity” item is reversed, the reversed amount can be included in distributable earnings.

    • (2) In accordance with Order 1010012865 issued by the Financial Supervisory Commission on April 6, 2012, for an entity adopting IFRSs the first time should set aside a special reserve. Later on, when the Company uses, disposes, or reclassifies related assets, the special reserve can be used for reversal by the proportion of the special reserve that has been set aside. If the aforementioned asset is investment property, the land part shall be reversed when it is disposed or reclassified, and for the non-land part, it shall be reversed progressively throughout the term of use.

4. The Company recognized dividends for owners of NT$102,301 and NT$0 for 2019 and 2018 respectively. On March 20, 2020, the board of directors proposed to all surpluses are retained without dividend.

  • (14) Other equity items
)Other equity items
January 1
IFRS 9 applicable effects
Foreign currency translation
differences:
- Group		 2019
Total
Unrealized gain/
loss on valuation
$ -
-
$-		 Foreign currency

translation

($ 24,340)
( 34,651)

($ 58,991)
($ 24,340)
( 34,651)
($ 58,991)		 
~38~
January 1
Adjustments on valuation
Foreign currency translation
differences
- Group
December 31		 2018
Unrealized gain/
loss on valuation		 Foreign currency Total
($ 70,511)
( 2,300)
48,471
($ 24,340)

Translation
$ 2,300
( 2,300)
-		 ($ 72,811)
-
48,471

($ 24,340)
$-
  • (15) Operating revenue
Revenue from contracts with customers 2019
$ 153,657		 2018
$ 102,640

1. Details of customer contract revenue

The Company’s revenue is mainly from the following lines of products ：

2019
Guest room
revenue
Revenue from contracts with
external revenue
$ 103,454
2018
Guest room
revenue
Revenue from contracts with
external revenue
$ 53,473		 Foodservice
Revenue
$ 45,747
Foodservice
Revenue
$ 45,265		 Others
$ 4,456
Others
$ 3,902		 Total
$ 153,657

Total
$ 102,640

2. Contractual liabilities

The Company has recognized the following contractual liabilities related to revenue from contracts with customers :


to revenue from contracts with customers:
December 31, 2019
Contractual liabilities:
Contractual liabilities - Room service contracts$ 3,161
Contractual liabilities - Foodservice contracts
5,035
$ 8,196		 December 31, 2018
$ 3,626
3,341
$ 6,967		 January 1,2018
$ 5,493
4,352

$ 9,845

Contractual liabilities at beginning of the reporting period recognized as revenue ：


revenue：
pening balance of contractual liabilities recognized as revenue:
Room service contracts
Foodservice contracts		 2019

$ 3,626
3,341
$ 6,967		 2018
$ 5,493
4,352
$ 9,845

Opening balance of contractual liabilities recognized as revenue: 

~39~
(16)Other income
2019 2018
Interest income
Bank deposit interest $ 21,077 $ 10,713
Rental income 2,073 2,072
Other income - others 1,005 284
$ 24,155 $ 13,069
(17)Other gains and losses
2019 2018
Disposal of property, plants, and equipment loss$ 62
$		 -
Net gain (loss) on foreign currency exchange ( 31,649)
14,783
Other gains (losses), net ( 8) 20
($ 31,595) $ 14,803
(18)Financial cost
2019 2018
Interest expense：
Long-term borrowings from banks $ 21,336
$		 17,176
Lease obligations interest 39 -
$ 21,375 $ 17,176
(19)Addition information on expenses
2019 2018
Employee benefit expense $ 57,788 $ 52,893
Property, plants, and equipment depreciation 28,245 29,591
Right-of-use assets depreciation expense 591 -
(20)Employee benefit expense
2019 2018
Wages and Salaries $ 49,444
$		 45,065
Health and labor insurance expense 4,904
4,534
Pension expense 2,424
2,308
Other Employee benefit expense 1,016 986
$ 57,788 $ 52,893 
~40~

1. In accordance with the Company's Article of Incorporation, 0.1% to 1% of the earnings of the year should be appropriated for employee compensation and no more than 1% for directors and supervisors renuneration. However, if the Corporation has accumulated deficit, the 。

priority is to offset the deficit first.

2. The Company estimated NT$0 for employees compensation and directors and supervisors renumeration for both 2019 and 2018. The 2018 employee compensation and directors and supervisors renumeration resolved by the Board of Directors are the amount separately $287 and $0 recognized in the 2018 financial report

Information on employee compensation and directors and supervisors renumeration approved by the Company's Board of Directors is posted on the Market Observation Post System

(21) Income tax

1. Income tax expense (benefit)

  • (1) Components of income tax expense (benefit) :
Current income tax:
Income tax generated from current
income:
Tax on unappropriated earnings
Overestimation of prior year income
tax
Total current tax
Deferred income tax:
Origination and reversal of
temporary differences
Effect on tax rate changes
Total of deferred tax income
Income tax expense (benefit)		 2019
$ -
4,570

-
4,570
1,035
-
1,035
$ 5,605		 2018
$ -
-
( 118)
( 118)
59,577
14,667
74,244
$ 74,126
  • (2)Other income tax amount related to comprehensive loss and gain:
2019
Exchange differences on translation of
foreign financial statements
($ 8,663)
Effect on tax rate changes
-
($ 8,663)		 2018
$ 11,161
( 3,827)
$ 7,334		 
~41~

2. Reconciliation between income tax expense (benefit) and accounting profit ：

Income tax calculated based on the net
profit before tax at the statutory rate
(See note)
Affected income tax amount according to
adjustment items stipulated by income
tax laws and regulations
Effect of tax rate changes
Overestimation of prior year income tax
Tax on unappropriated earnings
Income tax expense (benefit)		 2019
$ 183

852
-
-
4,570
$ 5,605		 2018
$ 57,358
2,219
14,667
( 118)
-
$ 74,126

Note: The basis of applicable tax rates is calculated using the tax rate

。 appropriate for the Company.

3. The deferred income tax assets or liabilities generated from temporary differences and tax losses are as follows ：

Deferred tax assets:
Temporary differences:
Exchange differences on
translation of foreign financial
statements
Unrealized exchange loss
Bonus for not taking leave
Tax losses
Deferred income tax liabilities:
Temporary differences:
Unrealized exchange gain
Investment income recognized
under the foreign equity method
Unrealized reserve for land
revaluation increment tax		 2019 2019
January 1

$ 6,891
-
212
36,642
 Recognized in
Gain or loss
($ 7,418)
3,809
46
8,076
$ 4,513
$ 2,110
( 7,658)
-
($ 5,548)
($ 1,035)		 Recognized in
Others
Comprehensive

December 31
$ 8,136
3,809
258
44,718
$ 56,921
$ -
( 192,297)
( 93,467)
($ 285,764)
($ 228,843)

income
$ 8,663
-
-
-
$ 8,663
$ -
-
-
$-
$ 8,663


$ 43,745


($ 2,110)

( 184,639)
( 93,467)
($ 280,216)

($ 236,471)
 
~42~

2018

Deferred income tax assets:
Temporary differences:
Exchange differences on
translation of foreign financial
statements
Unrealized exchange loss
Bonus for not taking leave
Tax losses
Deferred income tax liabilities:
Temporary differences:
Exchange differences on
translation of foreign financial
statements
Investment income recognized
under the foreign equity method
Unrealized reserve for land
revaluation increment tax		 January 1
 Recognized in
Gain or loss
($ 2,702)
( 720)
28
15,141
$ 11,747

($ 2,110)
( 83,881)
-
($ 85,991)
($ 74,244)		 Recognized in others
Comprehensive
Income
December 31
($ 7,334)
$ 6,891
-
-
-
212
-
36,642
($ 7,334)
$ 43,745
$ -
($ 2,110)
-
( 184,639)
-
( 93,467)
$-
($ 280,216)
($ 7,334)
($ 236,471)		 Recognized in others
Comprehensive
Income
December 31
($ 7,334)
$ 6,891
-
-
-
212
-
36,642
($ 7,334)
$ 43,745
$ -
($ 2,110)
-
( 184,639)
-
( 93,467)
$-
($ 280,216)
($ 7,334)
($ 236,471)

Income
($ 7,334)
-
-
-
($ 7,334)
$ -
-
-
$-
($ 7,334)

$ 16,927
720
184
21,501

$ 39,332

$ -
( 100,758)
( 93,467)
($ 194,225)
($ 154,893)		 $ 6,891
-
212
36,642
$ 43,745
($ 2,110)
( 184,639)
( 93,467)
($ 280,216)
($ 236,471)

4. The validity period of tax losses which the Company has not used and the amounts of unrecognized deferred income tax assets are provided below ：

December 31, 2019 December 31, 2019 December 31, 2019

o
Year of
ccurrence
Amount
filed/amount
approved
2013
Re-approved amount
2014
Reassessed and
reapproved amount
2015
Approved amount
2016
Approved amount
2017
Amount filed
2018
Amount to be filed
2019
Re-approved amount


$ 223,587
$		 
~43~

December 31, 2018

December 31, 2018
Year of
occurrence
Amount
filed/amount
approved
Deductible
amount
2023
Reapproved amount $ 14,300
$ 2024
Reapproved amount 3,003

2025
Approved amount
9,018

2026
Approved amount
26,590

2027
Amount filed
72,817

2028
Amount to be filed57,481

$ 183,209
$ 183,209		 $








  1. The tax authorities have examined and approved the Company’s 。

business income tax returns up to and including 2017.

  1. The amendment of increasing the business income tax from 17% to 20% of the Income Tax Act was promulgated and became effective on February 7, 2018. The Company has evaluated the related income tax effect in accordance with this tax rate change.

(22) Earnings (loss) per share

2019
Weighted average
of outstanding
Loss per share

shares
(1,000 shares)
(NT$)
Amount after
tax
Basic loss per share
Current net loss attributable to the
Company's common stock shareholders		 ($ 4,692)
110,486
 ($ 0.04)
Basic earnings per share
Current net income attributable to the
Company's common stock shareholders		 2018

Earnings per
share
(NT$)
$ 1.92
Amount after
tax
$ 212,662		 Weighted average
of outstanding
shares
(1,000 shares)


110,486

The above-mentioned weighted average number of outstanding shares has been retroactively adjusted proportionally according to the 2018 capital increase by retained earnings . 

~44~

(23) Operating lease

Applicable in 2018

The Company rent buildings, vehicles, operating equipment, office equipment, and other assets by operating lease for a lease term from 2016 to 2023. The Company recognized NT$1,809 as rental expense in profit or loss of 2018 respectively. The total future minimum lease payments under non-cancellable operating leases are as follows:

Less than one year
More than 1 year but less than 5 years		 December 31, 2018
$ 1,370
2,145
$ 3,515

(24) Additional cash flows information

(24)Additional cash flows information (24)Additional cash flows information (24)Additional cash flows information (24)Additional cash flows information (24)Additional cash flows information (24)Additional cash flows information
Investment activities paid partially by cash:
2019

Purchase of property, plants, and equipment
$ 1,973
$
Add: Other accounts payable at beginning of the period:
Fees for converting land purposes
(Stated in “Long-term notes and accounts payable”)127,577

Beginning balance payable - machinery and equipment
(Stated in “Other accounts payable”)
-

Less: Other accounts payable at the end of the period:
Fees for converting land purposes
(Stated in “Long-term notes and accounts payable”)( 127,577)
(
Cash paid
$ 1,973
$
(25)Change of liabilities from financing activities
2019
Short-term
borrowings
Short-term
notes payable
Lease
Liabilities
Long-term
liabilities
January 1
$1,204,500 $ 130,000
$ 2,537
$139,292
Change of cash flows from
Financing activities
325,500 - ( 573) ( 31,086)
Other change of non cash
-
-
11
-
December 31
$1,530,000
$ 130,000
$ 1,975
$108,206
2018
Short-term
borrowings
Short-term
notes payable
Lease
Liabilities
Long-term
liabilities
January 1
$1,059,977 $ 130,000
$ -
$188,288
Change of cash flows from
Financing activities
144,523
-
-
( 48,996)
December 31
$1,204,500
$ 130,000
$-
$139,292		 2018
10,183
127,577
915
127,577)
11,098

Total
liabilities from
financing activities
$ 1,476,329
293,841
11
$ 1,770,181

Total
liabilities from
financing activities
$ 1,378,265
95,527
$ 1,473,792
$


(
$

January 1
Change of cash flows from
Financing activities
Other change of non cash
December 31
January 1
Change of cash flows from
Financing activities
December 31

Short-term
borrowings
$1,204,500

325,500
-

$1,530,000

 Short-term
notes payable
$ 130,000
-
-
$ 130,000
 Lease
Liabilities
$ 2,537
( 573)
11
$ 1,975
2018		 Long-term
liabilities
$139,292
( 31,086)
-
$108,206
Short-term
borrowings
$1,059,977

144,523

$1,204,500
 Short-term
notes payable
$ 130,000
-
$ 130,000		 Lease
Liabilities
$ -
-

$-		 Long-term
liabilities
$188,288
( 48,996)
$139,292		 
~45~

7. Transactions with related parties

(1) Name of the related parties and their relations with the Company

Name of the related parties and their relations with the Company

Holiday Garden International Ltd.

Subsidiaries directly held by the Company

(“Int. Ltd.”) Holiday Garden Development Co., Ltd. Subsidiaries directly held by the Company Holiday Garden U.S. Subsidiaries directly held by Int. Ltd. (“US”) Holiday Garden SF CORP. Subsidiaries directly held by U.S. (“SF CORP.) Holiday Garden SN CORP. Subsidiaries directly held by U.S. (“SN CORP.) Holiday Garden NW CORP. Subsidiaries directly held by U.S. (“NW CORP.) Holiday Garden VC CORP. Subsidiaries directly held by U.S. (“VC CORP.) Holiday Garden WC CORP. Subsidiaries directly held by U.S. (“WC CORP.) Holiday Garden EV CORP. Subsidiaries directly held by U.S. (“EV CORP.)

(2) Material Transactions with related parties

Primary management renumeration and compensation information

Short-term employee benefits 2019
$ 2,825		 2018
$ 2,980

8. Collateralized assets

The Company's collateralized assets are listed below:

Assets
Land
Buildings and structures
Time deposits:
(Stated in “Other financial asset -
current”)
Time deposits:
(Stated in “Other financial asset -
current”)		 Book value
December 31, 2019
December 31, 2018
 Book value
December 31, 2019
December 31, 2018
 For guarantee purposes
December 31, 2019


$ 481,493
181,294
997,129
1,857

$ 1,661,773

$ 481,493
203,260
587,084
2,142
$ 1,273,979


Short-term and
long-term borrowings

Short-term and
long-term borrowings

Short-term
borrowings
Voucher performance
guarantee		 
~46~

9. Significant contingent liabilities and unrecognized contractual commitments

(1)Contingency

None

(2)Undertakings

No undertakings

10. Significant casualty losses

None

11. Major events after the reporting period

None

12.Others

(1) Capital management

The Company’s capital management objectives are to secure the Company’s ability to continue as a going concern, maintain the optimal capital structure for reducing the cost of capital, and to provide returns to our shareholders. To maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, or issue new shares or sell assets to reduce the liabilities. Consistent with the industry’s practice, the Company manages the assets by the debt to assets ratio.

The Company's strategy is to maintain a stable debt to assets ratio. See below for the ratios. ：

ratios.：
December 31, 2019
December 31, 2018
Total liabilities $ 2,214,991
$		 1,910,730
Total assets $ 3,504,256
$		 3,259,798
Debt to assets ratio 63
 59
nancial instruments
Types of financial instruments
December 31, 2019 December 31, 2018
Financial assets
Financial assets measured at amortized cost
Cash and cash equivalents $ 91,968 $ 30,969
Financial assets measured at amortized 998,986 589,226
Notes receivable 938 400
Accounts receivable 6,428
5,757
Other accounts receivable 2,874
3,355
Guarantee deposits paid 378 1,087
$ 1,101,572 $ 630,794

(2) Financial instruments

1. Types of financial instruments 

~47~
Financial assets
Financial assets measured at
Short-term borrowings
Short-term notes and bills
Notes payable
Accounts payable
Other accounts payable
Long-term borrowings
Long-term notes and accounts
Guarantee deposits received
Lease liabilities		 December 31, 2019
$ 1,530,000
130,000
322
2,519
15,663
108,206
127,577
870
$ 1,915,157
$ 1,975		 December 31, 2018
$ 1,204,500
130,000
1,366
5,441
12,917
139,292
127,577
755
$ 1,621,848
$-
  • 2 . Financial instruments not measured at fair value

The Company’s financial assets and liabilities that are not assessed by fair value (including cash and cash equivalents, notes receivable, accounts payable, other receivable, other financial assets (current), refundable deposits, short-term borrowings, short-term notes payable, notes payable, accounts payable, other payable, long-term borrowings (including current portion of long-term debt payable), long-term notes and accounts payable, and guarantee deposits receive) have a carrying value reasonably close to their fair value.

  1. Risk management policies

  2. (1) The Company's regular operations are affected by multiple financial risks, including market risk (including the foreign exchange rate risk, interest rate risk, and price risk), credit risk, and liquidity risk.

  3. (2) Risk management work is implemented by the Company's finance department in accordance with the approved policies. The Company's finance department closely collaborates with all operating departments for identifying, evaluating, and avoiding financial risk.

  4. Nature and level of significant financial risk

  5. (1) Market risk

Foreign exchange rate risk

  • A. The Company’s investment in subsidiaries exposes the Company to foreign exchange rate risk generated from transactions using currencies different from the Company’s functional currency (primarily the US dollars). Foreign exchange rate related risk comes from future commercial transactions and recognized assets and liabilities. 
~48~

  • B. The Company’s management has set policies requiring the Company to manage the foreign exchange rate risk related to its functional currency. The Company should manage the risk according to the overall foreign exchange rate risk through the finance department.

  • C. The Company's businesses involve several non-functional currencies (The Company’s functional currency is New Taiwanese Dollars), and they are affected by exchange rate fluctuation. Information of foreign currency assets and liabilities subject to material effect of exchange rate fluctuation is presented below: 

~49~
(Foreign currency: functional
currency)
Financial assets
Currency item
US$ : NT$ Long-term investments
accounted
for using the equity method
US$ : NT$ 按一下這裡以輸入文字。
(Foreign currency: functional
currency)
Financial assets
Currency item
US$ : NT$ Long-term investments		 December 31, 2019 December 31, 2019 December 31, 2019 December 31, 2019 December 31, 2019


Foreign
currencies
(NT$1,000)
Exchange
rate
Carrying amount
(NT$)
Degree of
variation
$ 35,354
29.98
$ 1,059,910
1%
53,485
29.98
1,603,478
1%
December 31, 2018

Foreign
currencies
(NT$1,000)
Exchange
rate
Carrying amount
(NT$)
Degree of
variation
$ 19,148
30.72
$ 588,140
1%
59,063
30.72
1,814,419
1%

Sensitivity analysis

Effect on
profit or loss
$ 10,599
-
$

Foreign
currencies
(NT$1,000)
Exchange
rate
Carrying amount
(NT$)
$ 19,148
30.72
$ 588,140
59,063
30.72
1,814,419


Degree of
variation
1%
1%
Effect on
profit or loss
$ 5,881
-		 


~50~
  • D.The overall gain (loss) from the exchange (including realized and unrealized) of the Company’s currency items due to material exchange rate fluctuation was NT$31,649 and (NT$14,783) in18 and 2017 respectively.

Price risk

。 The Company is not exposed to significant commodity price risk

Cash flows and fair value interest rate risk 

  - `A.` The Company’s interest risk comes from short-term and long-term borrowings at a floating interest risk, and they expose the Company to cash flows interest rate risk.

  - B. The Company’s loans are measured at amortized cost and the interest rates are re-set each year according to the contract. Therefore, the Company is exposed to the risk of future market interest rate changes.

  - C. When interest rate of loans increases or decreases by 1% but all remaining factors stay the same, the net profit before tax will increase by NT$13,438 and decrease by NT$16.382in 2019 and 2018 respectively, and it is mainly caused by changes in the interest rate of floating rate loans.

  • (2) Credit risk

  • A.The Company is exposed to credit risk of customers’ failure of fulfilling their contractual obligations, which can expose the Company to financial losses. The primary source of credit risk is the counterparty's failure of paying accounts receivable according to the terms of payment.

  • B.The Company has to manage and perform credit risk analysis in accordance with the internal credit policy before entering into the terms and conditions of payment and service rendering with each new customer. Internal risk control evaluates a customer's credit quality based on the customer’s financial condition, past experience, and other factors.

  • C. The Company adopts the premise provided by IFRS9: When a payment is 30 days past due according to the contractual terms and conditions, the credit risk of this financial asset is deemed to have increased significantly since its initial recognition.

  • D. The Company adopts the premise provided by IFRS9: When a payment is more than 90 days past due according to the contractual terms and conditions, default is deemed to have happened.

  • E.The Company classifies customers’ notes and accounts receivable according to credit conditions and adopts a simplified method that uses 

~51~

the loss rate as the basis for estimating the expected credit loss.

  • F. According to future forward-looking considerations, the Company adjusts the loss rate established based on the history of a specific period and current information to estimate the loss allowance of notes and accounts receivable. The provision matrix at December 31, 2018 is as follow ：

Not past due

December 31, 2018
Expected loss rate
Total book value
Loss allowance		 and past due
for 1 to
30days
Past due for 31 to
90 days
Past due for more
than 91
days
0.59%
1.06 %
100.00%
$ 6,336
$ 1,035
$ 120 $
3
2
120		 Total
7,491
125
December 31, 2018
Expected loss rate
Total book value
Loss allowance		 Not past due
and past due
for 1 to 30
days
0.11%
$ 5,591
-		 Past due for 31 to Past due for more
than 91
days
100%
69
$
-
 Total
6,157
-


$
$
 90 days
1.00%
497
-
  • G. The statement of changes in the allowance for loss on accounts receivable using the simplified method is as following
January 1
Impairment loss provision
December 31		 2019
$ -
125
$ 125		 2018
$ -
-
$-

(3) Liquidity risk

  • A. A. Cash flows forecasts are performed by each operating entity of the Company and summarized by the finance department of the Company. The Company’s finance department monitors the Company's circulating capital requirements to ensure that the Company has sufficient capital for its operating needs, and a sufficient unspent loan commitment is maintained at all times.

  • B. When the residual cash held by each operating entity exceeds the amount of operating capital required for management, it shall be transferred back 

~52~

to the finance department of the Company. The Company’s finance department will invest the residual funds in demand deposits, checking deposits, and time deposits, and the selected instruments have a proper due date or an adequate liquidity in order to meet the above-mentioned forecasts and ensure that the Company has sufficient liquidity to fund the requirements. At December 31, 2019 and 2018, the Company’s money market position was NT$90,483 and NT$30,209 respectively, and they can generate immediate cash flows for liquidity risk management.

  • C. The following table shows the Company's non-derivative financial liabilities, which are classified by the maturity date. Non-derivative financial liabilities are analyzed based on the time remains from the balance date to the contractual maturity date. The following table discloses the amount of contractual cash flows that is non-discounting.

December 31, 2019

December 31, 2019
Non-derivitive financial liabilities:
Short-term borrowings
Short-term notes and bills payable
Notes payable
Accounts payable
Other accounts payable
Lease obligation
Long-term borrowings (including the
current portion of long-term debt payable)
Long-term notes and accounts payable
Guarantee deposits received
December 31, 2018
Non-derivitive financial liabilities:
Short-term borrowings
Short-term notes and bills payable
Notes payable
Accounts payable
Other accounts payable
Long-term borrowings (including the
current portion of long-term debt payable)
Long-term notes and accounts payable
Guarantee deposits received		 In 1 year
$ 1,532,085
130,000
322
2,519
15,663
614
53,712
-
25
In 1 year
$ 1,211,636
130,000
1,366
5,441
12,917
51,569
-
20		 1 to 2 years
$ -
-
-
-
-
1,420
39,856
127,577
368
1 to 2 years
$ -
-
-
-
-
46,833
127,577
25		 More than 2
years
$ -
-
-
-
-
-
16,896
-
477
More than 2
years
$ -
-
-
-
-
44,937
-
710
$
$






 
~53~

13. Supplementary disclosure

(1) Information related to material transactions

  1. Financing provided: See Table 1 attached.

  2. 。

    1. Endorsement provided: None

  4. 3.Marketable securities held at closing period (excluding investments in subsidiaries, associates, and joint ventures): None

4. Marketable securities acquired and disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital: See Table 2 attached

5. Properties acquired at costs or prices of at least NT$300 million or 20% of the paid-in capital: See Table 3 attached.

6. Properties disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital: None

7. Total purchases from or sales to related parties of at least NT$100 million or 20% of the paid-in capital: None.

8. Receivable from related parties amounting to at least NT$100 million or 20% of the paid-in capital: See Table 4 attached

  1. Engagement in derivative instruments: None.

  2. 10.Business relations and material transactions and amounts between the parent company and its subsidiaries and among the subsidiaries: See Table 5.

(2) Re-investment related information

The investee's name, location, and other related information (excluding investees in mainland China): See Table 6.

(3) Investment in mainland China

1. Basic information: None

  1. Significant direct or indirect transactions with the investee in mainland China through an enterprise at a third place: None

14. Segment information

Not applicable 

~54~

Holiday Garden International Ltd. and subsidiaries

Loan funds

January 1,2019 to December 31,2019
Table 1
No.
(Note.1)
Company providing
the loan
Borrower
Transaction
item(Note2)
A
related
party
yes or
not
The m
of
1
Holiday Garden
International Ltd.
Holiday Garden
U.S.
Receivable
from related
companies
yes
$
2
Holiday Garden
U.S.
Holiday Garden
NW CORP.
Receivable
from related
companies
yes

2
Holiday Garden
U.S.
Holiday Garden
VC CORP.
Receivable
from related
companies
yes

2
Holiday Garden
U.S.
Holiday Garden
WC CORP.
Receivable
from related
companies
yes

2
Holiday Garden
U.S.
Holiday Garden
WC CORP.
Receivable
from related
companies
yes

2
Holiday Garden
U.S.
Holiday Garden
SN CORP.
Receivable
from related
companies
yes

2
Holiday Garden
U.S.
Holiday Garden
EV CORP.
Receivable
from related
companies
yes

2
Holiday Garden
U.S.
Holiday Garden
EV CORP.
Receivable
from related
companies
yes

3
Holiday Garden SF
CORP.
Holiday Garden
VC CORP.
Receivable
from related
companies
yes

3
Holiday Garden SF
CORP.
Holiday Garden
U.S.
Receivable
from related
companies
yes
 aximum amount
this period
(Note3)
Closing balance
(Note 8)
Actualdrawing
amount
Range of
interest
rate
Type of loan
fund
(Note 4)
Business
transaction
amount
(Note 5)
Reasons for
short-term
financing
(Note6)
1,448,560 $ 1,448,560 $ 1,054,242
Annual
interest
6.5%
Short-term
financing
funds
$ -
Operational
needs

92,520 92,520 92,520
Annual
interest
3.0%
Short-term
financing
funds
-
Hotel
acquisition

46,260 46,260 46,260
Annual
interest
3.0%
Short-term
financing
funds
-
Hotel
acquisition

584,820 584,820 429,370
Annual
interest
6.5%
Short-term
financing
funds
-
Hotel
acquisition

64,980 64,980 64,980
Annual
interest
3.0%
Short-term
financing
funds
-
Hotel
acquisition

539,350 - -
Annual
interest
6.5%
Short-term
financing
funds
-
Hotel
acquisition

94,950 94,950 31,650
Annual
interest
6.5%
Short-term
financing
funds
-
Operational
needs

953,680 953,680 559,362
Annual
interest
6.5%
Short-term
financing
funds
Hotel
acquisition

154,200 154,200 154,200
Annual
interest
3.0%
Short-term
financing
funds
-
Hotel
acquisition

387,516 387,516 387,516
Annual
interest
3.0%
Short-term
financing
funds
-
Operational
needs
 Recognized
amount of
loss
allowance
$ -
-
-
-
-
-
-
-
-
-		 Collaterals

Name
Value
None $ -
None -
None -
None -
None -
None -
None -
None -
None -
None -		 Unit: NT$1,000
(Unless otherwise noted)
Maximum amount of
loans permitted to
a single
borrower(Note 7)
Total amount
permitted for
loaning of funds
（Note 7）
Note
$ 12,026,085 $ 24,052,170
Note 9
3,513,833 7,027,665
Note 9
3,513,833 7,027,665
Note 9
3,513,833 7,027,665
Note 9
3,513,833 7,027,665
Note 9
3,513,833 7,027,665
Note 9
3,513,833 7,027,665
Note 9
3,513,833 7,027,665
Note 9
843,578 1,687,155
Note 9
843,578 1,687,155
Note 9

Table 1

Note 1: See the footnotes below

 (1) 0 for the Company

 (2) For the investees, they are coded from 1 according to the company. Investees of the same company share the same code

Note 2: Recorded accounts receivable from related companies and/or parties, shareholders accounts, prepayments, temporary payments, etc. should be entered in this field if they are related to loans to others.

Note 3: It is the cumulative maximum balance of loaning others from the current year to the reporting month.

Note 4: For loans to others and the type, fill in the parties that the Company has business transaction with or that require short-term financing funds.

Note 5: For the business transaction type of loans, fill in the amount of the business transactions.

Note 6: For those requiring the short-term financing type of loans, concretely explain the reason for loaning and the borrowers ’ use of the loans, such as for making repayments, purchase of equipment, or operational needs ： 

Note 7: Enter the limit of loans for individual borrowers and the total amount of loans set by the Company in accordance with the loans to others operating procedure and enter the method of calculation of the limit of loan for individual borrowers
and the total limit of loans in the note section.

Note 8: Enter the amount of funds loaned to others that remains effective as of the reporting month. (For an publicly listed company deciding to resolve each fund to be loaned to other at the Board of Directors according to Article 14.1 of the Procedure
of Management of Loans to Others, then even if the fund has not yet been appropriated, the amount of loans resolved at the Board of Directors should be stated in the announced balance to disclose the exposed risk.If said funds are repaid later,
the balance after the repayment should be disclosed to reflect the adjusted risk. If, in accordance with Article 14.2 of Regulations Governing the Administration of Shareholder Services of Public Companies, a publicly listed company decides to authorize
the chairperson of the board, resolved at the board of directors, to have the funds for lending that are within the specific amount authorized in installment or revolver within one year, it is the balance of the amount of loans to others approved
at the Board of Directors that should be announced and filed. Said loans to others may be repaid later, but because lending may be authorized again, use the amount of loans to others approved by the Board of Directors as the balance announced and
reported.

Note 9: In accordance with the Company's Operating procedure of management of loans to others, the amount of loans to foreign subsidiaries, in which the Company holds directly or indirectly, 100% of the voting shares or to individual borrowers should
not exceed 7.5 times of the Company's net value, and the total amount of loans should not exceed 15 times of the net value of the company, and the duration of loans should be no more than 15 years.

~55~

Holiday Garden Hotel Co., Ltd.
Properties disposed of at costs or prices of at least NT$300 million or 20% of the paid-in capital
January 1,2019 to December 31,2019

Table 2

  Unit: NT$1,000

(Unless otherwise noted)
Buying and selling
companies
Holiday Garden
Hotel Co., Ltd.
Types of marketable
securities (Note1)
Account
Transaction object
(Note 2)
Relationship
(Note 2)
Seasoned equity
offering
Investment
adopted with
Equity method
Holiday Garden
International Ltd.
Parent and
subsidiary
companies		 beginning of term

Number of
shares
Amount
12,000 $ 848,895		 Buying(Note3.5)
Number of
shares
Amount
-
$ 400,000		 Selling(Note3.5)

Diposal
of gain		 End of term
Number of
shares
12,000 $		 Number of
shares
Selling
Price
Book cost
- $ - ($ 605,915)		 Number of
shares
Amount
12,000 $ 642,980
d l
$ -

Note 1 ： Marketable securities in this table refer to stocks, bonds, beneficial certificates and marketable securities arising from the above items.

Note 2 ： Investors in equity-method securities are required to complete these two fields and the remaining fields are not required

Note3 ： The cumulative purchase and sale amounts shall be calculated separately according to the market price to determine whether they amount to $300 million or 20% of the paid-in capital 

Note 4: Paid-in capital refers to the paid-in capital of the parent company. If the shares issued by an issuer have no par value or a par value other than NT$10 per share, the threshold transaction amount
of 20% of paid-in capital shall be replaced by 10% of equity attributable to owners of the parent company as  stated in the balance sheet

Note5 ： Includes capital increases and decreases during the period, share of subsidiaries, affiliates and joint ventures recognized under the equity method, distribution of investment earnings under the equity method, valuation adjustments of available-for-sale financial assets of investees and translation differences in the financial statements of foreign operating companies. 

~56~

Holiday Garden International Ltd. and subsidiaries

                                                             Properties acquired of at costs or prices of at least NT$300 million or 20% of the paid-in capital

January 1,2019 to December 31,2019

Table 3

  Unit: NT$1,000

(Unless otherwise noted)

The former tranfer information of transaction object is related party purpose of other Company which acquired Occuring Transaction Relationship with Transfer reference of acquirsition appointment properties property name Date amount Payment of price Transaction object Relationship Holder issuer daye Amount priceBasis Usage Item Holiday Garden EV Emeryville Hyatt 108/01/29 $ 1,636,220 $ 1,636,220 Bay street Hotel None-related - - - $ - Valuation Operating the None CORP. place 旅館 Properties,LLC parties report food and hotel business in U.S.A

Note 1: If appraisal is required for asset disposal in accordance with the regulations, enter the appraisal results in the section “Reference for price determination. ” 

Note 2: Paid-in capital refers to the paid-in capital of the parent company. If the shares issued by an issuer have no par value or a par value other than NT$10 per share, the threshold transaction amount of 20% of paid-in
capital shall be replaced by 10% of equity attributable to owners of the parent company as stated in the balance sheet.

Note 3: Date of occurrence refers to the date of contract signing, date of payment, date of consignment trade, date of transfer, dates of boards of directors resolutions, or other date that can confirm the counterparty
and monetary amount of the transaction, whichever date is earlier.

~57~

Holiday Garden International Ltd. and subsidiaries

Receivable from related parties amounts to at least NT$100 million or 20% of the paid-in capital.
January 1,2019 to December 31,2019

Table 4

Unit: NT$1,000
(Unless otherwise noted)
Companies of account receivable
 Transaction object name

Holiday Garden U.S.
Holiday Garden WC CORP.
Holiday Garden U.S.
Holiday Garden VC CORP.
Holiday Garden EV CORP.
Holiday Garden SF CORP.		 Relationship
Balance of Receivable from related
companies (Note 1)
Note 3
Account receivable：1,019,320
Note 3
Account receivable：449,700
Note 3
Account receivable：386,742
Note 3
Account receivable：149,900
Note 3
Account receivable：569,620
Note 3
Account receivable：109,345		 Turnover rate
Past due accounts
receivable from relatedAccounts receivable recovered
from related companies after
the reporting period
Amount
Amount
Treatment
Note 4
$ -
- $ -
$
Note 4
-
- -

Note 4
-
- -

Note 4
-
- -

Note 4
-
- -

Note 4
-
- -
 of loss allowance
recognized
-
-
-
-
-
-
Holiday Garden International
Ltd.
Holiday Garden U.S.
Holiday Garden SF CORP.
Holiday Garden SF CORP.
Holiday Garden U.S.
Holiday Garden WC CORP.		 
Note 1: Please enter the accounts receivable of the related parties, the notes, and other accounts receivable.

Note 2: Paid-in capital refers to the paid-in capital of the parent company. If the shares issued by an issuer have no par value or a par value other than NT$10 per share, the threshold transaction amount
of 20% of paid-in capital shall be replaced by 10 percent of equity attributable to owners of the parent company as stated in the balance sheet.
Note 3: The investee and the counterparty are both subsidiaries of the Company.

Note 4: It is mainly because that “other accounts receivable ” is not suitable for calculating the days of turnovers. 

~58~

Holiday Garden International Ltd. and subsidiaries

Business relations and material transactions and amounts between the parent company and its subsidiaries and among the subsidiaries

January 1,2019 to December 31,2019
ble 5
Number
(Note 1)
1
1
1
1
1
1
1
2
2
2
2
2
2
2
3
3
3
4
5
6		 Name
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden International Ltd.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden SF CORP.
Holiday Garden SF CORP.
Holiday Garden SF CORP.
Holiday Garden VC CORP.
Holiday Garden NW CORP.
Holiday Garden WC CORP.		 Counterparty
Relationship with
the counterparty
(Note 2)
Holiday Garden U.S.
(3)
Holiday Garden U.S.
(3)
Holiday Garden SF CORP.
(3)
Holiday Garden NW CORP.
(3)
Holiday Garden VC CORP.
(3)
Holiday Garden WC CORP.
(3)
Holiday Garden EV CORP.
(3)
Holiday Garden SF CORP.
(3)
Holiday Garden NW CORP.
(3)
Holiday Garden WC CORP.
(3)
Holiday Garden WC CORP.
(3)
Holiday Garden EV CORP.
(3)
Holiday Garden VC CORP.
(3)
Holiday Garden EV CORP.
(3)
Holiday Garden VC CORP.
(3)
Holiday Garden U.S.
(3)
Holiday Garden U.S.
(3)
Holiday Garden SF CORP.
(3)
Holiday Garden SF CORP.
(3)
Holiday Garden SF CORP.
(3)		 Unit: NT$1,000
(Unless otherwise noted)
Transaction condition
Transaction conditions
Ratio to consolidated
total revenue or total
assets (Note 3)
Processed according to the agreement
between the two parties
13.33%
Processed according to the agreement
between the two parties
4.56%
Processed according to the agreement
between the two parties
0.91%
Processed according to the agreement
between the two parties
0.91%
Processed according to the agreement
between the two parties
0.91%
Processed according to the agreement
between the two parties
0.91%
Processed according to the agreement
between the two parties
0.46%
Processed according to the agreement
between the two parties
0.45%
Processed according to the agreement
between the two parties
1.18%
Processed according to the agreement
between the two parties
5.88%
Processed according to the agreement
between the two parties
2.17%
Processed according to the agreement
between the two parties
2.09%
Processed according to the agreement
between the two parties
0.59%
Processed according to the agreement
between the two parties
7.45%
Processed according to the agreement
between the two parties
1.96%
Processed according to the agreement
between the two parties
5.06%
Processed according to the agreement
between the two parties
0.79%
Processed according to the agreement
between the two parties
0.54%
Processed according to the agreement
between the two parties
0.17%
Processed according to the agreement
between the two parties
1.43%


Account
 Amount

$1,019,320
69,384
13,910
13,910
13,910
13,910
6,955
34,487
89,940
449,700
32,996
31,701
44,970
569,620
149,900
386,742
11,962
41,136
13,113
109,345
Other accounts receivable
Interest income
Other income
Other income
Other income
Other income
Other income
Other accounts receivable
Other accounts receivable
Other accounts receivable
Interest income
Interest income
Other accounts receivable
Other accounts receivable
Other accounts receivable
Other accounts receivable
Interest income
Other accounts receivable
Other accounts receivable
Other accounts receivable		 
Table 5

Note 1: Business transaction information between the parent company and its subsidiaries should be coded in the coding section, and the coding is described below.

(1) 0 for the parent company.

~59~
  • (2) For the subsidiaries, they are coded starting from 1 based on the company 
Note2: There are the following three types of relationship with counterparties, and only the type is specified (one disclosure for the same transaction between the parent company and a subsidiary or among
subsidiaries). For example, for a transaction between the parent company and a subsidiary, if the parent company has already disclosed it, there is no need for the subsidiary to disclose the same transaction
again. For transactions among subsidiaries, if one subsidiary has disclosed it already, then there is no need for the other subsidiary to disclose it again.)

  • (1) The parent company to a subsidiary

  • (2) A subsidiary to the parent company

  • (3) A subsidiary to another subsidiary 

Note 3: Regarding the ratio of transaction amount to consolidated total operating revenues or total assets, it is computed based on the closing balance to consolidated total assets for balance sheet accounts,
and as for income statement accounts, it is based on accumulated amount to consolidated total operating revenue

Note 4: The significant transaction conditions summarized in this table are transactions of an amount greater than NT$ 5 million or 20% of the paid-in capital of the parent company.

~60~

Holiday Garden International Ltd. and subsidiaries

The investee's name, location, and other related information (excluding investees in mainland China)
January 1,2019 to December 31,2019
Table 6
Investor
Investee
(Notes 1 and 2)
Holiday Garden
International Ltd.
Holiday Garden
International Ltd.
Holiday Garden
International Ltd.
Holiday Garden
International Ltd.
Holiday Garden
International Ltd.
Holiday Garden U.S.
Holiday Garden U.S.
Holiday Garden SF CORP.
Holiday Garden U.S.
Holiday Garden SN CORP.
Holiday Garden U.S.
Holiday Garden NW CORP.
Holiday Garden U.S.
Holiday Garden VC CORP.
Holiday Garden U.S.
Holiday Garden WC CORP.
Holiday Garden U.S.
Holiday Garden EV CORP.		 Location
Primary
business items
Taiwan
Tourism hotels
Bermuda
Investment
business
USA
Investment
business
USA
Tourism hotels
USA
Tourism hotels
USA
Tourism hotels
USA
Tourism hotels
USA
Tourism hotels
USA
Tourism hotels		 Initial investment amount
Ending of reporting
period
Previous year end

$ 65,000
$ 65,000
642,980
848,895
251,291
251,291
84,662
84,662
72,900
72,900
81,250
81,250
81,250
81,250
80,700
80,700
77,188
-		 Initial investment amount
Ending of reporting
period
Previous year end

$ 65,000
$ 65,000
642,980
848,895
251,291
251,291
84,662
84,662
72,900
72,900
81,250
81,250
81,250
81,250
80,700
80,700
77,188
-		 Unit: NT$1,000
(Unless otherwise noted)
End of the reporting period
Investee’s current
profit and loss
(Notes 2(2))
Recognized current
investment gain or
loss (Note 2(3))
Note
Number of shares
Ratio
Carrying amount
6,500
100 $ 50,525
($ 3,683)
($ 3,683)
The
Company's
subsidiary
12,000
100
1,603,478
38,288
38,288
The
Company's
subsidiary
18,000
100 468,511
( 59,775)
( 59,775)
The
Company's
subsidiary
170,000
100 112,477
46,280
46,280
The
Company's
subsidiary
150,000
100 -
( 5,143)
( 5,143)
The
Company's
subsidiary
150,000
100 57,302
1,057
1,057
The
Company's
subsidiary
150,000
100 19,052
2,327
2,327
The
Company's
subsidiary
150,000
100 ( 80,777)
( 41,763)
( 41,763)
The
Company's
subsidiary
150,000
100 40,178
( 35,851)
( 35,851)
The
Company's
subsidiary
Ending of reporting
period
$ 65,000
642,980
251,291
84,662
72,900
81,250
81,250
80,700
77,188
$ 65,000
848,895
251,291
84,662
72,900
81,250
81,250
80,700
-		 
Note 1: For a publicly company with an overseas holding company and using the consolidated financial report as the major financial report in compliance with local laws and regulations,
the disclosure of information of overseas investees can be limited to information related to the holding company.

Note 2: If the circumstances described in Note 1 are not applicable, please enter the following information:

  • (1) For the name of the investee, the location, the primary business items, the initial investment amount, and shareholding at the end of the period, they should be filled out in sequence according to the reinvestment of the Company (a publicly listed company) and each reinvestment of each direct or indirect controlled investee. In addition, the relationship

  • (e.g., a subsidiary or a subsidiary-subsidiary of the parent company) between each investee and the Company (a publicly listed company) should be entered.

(2) For the section of “investee ’ s profit and loss, ” please enter the amount of current profit and loss of each investee.

(3) For “Recognized current investment income, ” enter only the recognized amount of profit and loss of each direct investment subsidiary of the Company (a publicly listed company) and of each investee accounted for using the equity method. The balance is not required. When entering the “Amount of profit and loss recognized of each subsidiary of direct reinvestment, ” subsidiary of the Company (a publicly listed company) and of each investee accounted for using the equity method. The balance is not required. When entering the “Amount of profit and loss recognized of each subsidiary of direct reinvestment, ” make sure that the amount of profit or loss of each subsidiary includes the investment income of the reinvestment to be recognized in accordance with the regulations. 

~61~

Holiday Garden International Ltd. Statement of cash and cash equivalents December 31, 2019

Item
Cash in treasury and working
funds
Checking deposits
Demand deposits:
in New Taiwanese Dollars
Demand deposits:
in US Dollars
Time deposits:
n New Taiwanese Dollars
Time deposits: in US Dollars		 Abstract
USD$394,000,Exchange rate: 29.98
Expiration date: February 2
Interest rate: 0.16%
Expiration date：
January 20,2020-February 2,2020
Interest rate:2.10%~2.28%		 Unit: NT$1,000
Amount
$ 1,485
309
17,394
11,814
10,000
50,966
$ 91,968		 
Statement 1 on Page 1

Unit: NT$1,000

Statement 2

Holiday Garden International Ltd.
Statement of changes in investment property accounted for using the equity method
January 1 to Decembe 31, 2019
Opening balance
Add (Note 1)
Less (Note 2)
Name
Number of
shares
Amount
Number of
shares
Amount
Number of
shares
Amount
HOLIDAY GARDEN
INTERNATIONAL Ltd.
12,000 $1,814,419
$438,288
-
($ 649,229)
Holiday Garden Development
Co., Ltd
6,500,000
54,208
-
-
-
( 3,683)
$1,868,627
$438,288
($ 652,912)		 Closing balance Closing balance Closing balance
Amount
1,603,478
50,525
 Market price or net equity Guarantee
provision
or pledge
condition
Note
None
None

Number of
shares
12,000
6,500,000

%
shareholding

100%
$ 100%

$
Unit price ($)
Total price
Evaluation
basis
$ 133,623 $ 1,603,478 Equity Law
7.7750,525
Equity Law
$ 1,654,003


100%
100%
$ 133,623
7.77

$

1,654,003

Note 1: Addition of this reporting period includes increased investment amount of this period and share of profit and loss of subsidiaries, associates, joint ventures accounted for using the equity method.

Note 2: Reduction of this reporting period includes cash returned from investees’ capital reduction and the exchange differences on translation of foreign financial statements. 

Statement 2 on Page 1

Holiday Garden International Ltd. - Statement of short term borrowings December 31, 2019

Unit: NT$1,000
Type of borrowings
Description
Unsecured loans from
banks
Hua Nan Commercial
Bank – East Kaohsiung
Branch
Unsecured loans from
banks
Export-Import Bank of
Republic of China
Unsecured loans from
banks
Export-Import Bank of
Republic of China
Unsecured loans from
banks
Export-Import Bank of
Republic of China
Unsecured loans from
banks
Export-Import Bank of
Republic of China
Secured bank loans
Mega International Commercial
Bank
Secured bank loans
Mega International Commercial
Bank
Secured bank loans
CTBC Bank
Secured bank loans
CTBC Bank
Secured bank loans
O-Bank		 Type of borrowings
Description
Unsecured loans from
banks
Hua Nan Commercial
Bank – East Kaohsiung
Branch
Unsecured loans from
banks
Export-Import Bank of
Republic of China
Unsecured loans from
banks
Export-Import Bank of
Republic of China
Unsecured loans from
banks
Export-Import Bank of
Republic of China
Unsecured loans from
banks
Export-Import Bank of
Republic of China
Secured bank loans
Mega International Commercial
Bank
Secured bank loans
Mega International Commercial
Bank
Secured bank loans
CTBC Bank
Secured bank loans
CTBC Bank
Secured bank loans
O-Bank		 Closing balance
Contract term
$ 30,000 108.10.17~109.01.17
5,000 108.08.16~109.08.16
10,000 108.07.16~109.07.16
20,000 108.08.01~109.08.01
10,000 108.12.16~109.12.16
400,000 108.06.04~109.06.03
155,000 108.09.23~109.06.17
400,000 108.12.06~109.05.06
100,000 108.10.30~109.04.30
400,000
108.12.27~109.01.22
$ 1,530,000		 Range of
interest rates
Financing
amount

Pledges or
collaterals

1.25%
$ 30,000
None

1.25%
5,000
None

1.26%
10,000
None

1.26%
20,000
None

1.26%
45,000
None

1.90%
400,000
Land, Housing
and
Construction

1.30%
170,000
Land, Housing
and
Construction

1.10%
400,000Time deposit

1.10%
600,000Time deposit

1.11%
400,000Time deposit		 Note: 
Statement 3 on Page 1

Holiday Garden International Ltd. - Statement of short term notes and bills payable December 31, 2019

Statement 4

Unit: NT$1,000

Item
Commercial paper
Commercial paper
Commercial paper		 Guarantee Institution Contract term
108.12.13~109.02.11
108.12.13~109.02.11
108.12.13~109.02.11		 Range of Range of Amount
Book value

$ 50,000
50,000
30,000
$ 130,000		 Note:




interest
rates
0.96%
0.60%
0.81%		 Amount
$ 50,000
50,000
30,000
$ 130,000		 Unamortized
discounts
$ -
-
-
$-
Mega Bills Finance Co., Ltd.
China Bills Finance Corporation
International Bills Finance
Corporation		 
Statement 4 on Page 1

Holiday Garden International Ltd.
-
Statement of longterm borrowings
December 31, 2019

Unit: NT$1,000
Creditor
First Commercial Bank,
Sanmin Branch
Mega International Commercial
Bank
Co., Ltd., Kaohsiung Branch
Mega International Commercial
Bank
Co., Ltd., Kaohsiung Branch
Hua Nan Commercial Bank –
East Kaohsiung Branch		 Summary Amount of Borrowing

$ 22,978
38,895
28,000
18,333
108,206
( 52,196)
$ 56,010		 Amount of Borrowing
 Contract term

101.09.18~111.09.18
103.06.04~110.06.04
104.06.01~111.06.01
108.09.20~111.09.20		 Interest

1.75%
1.90%
1.70%
1.38%		 Financing amount
$ 58,678
300,000
100,000
20,000		 Pledges or Collaterals

Land, buildings
and structures
Land, buildings
and structures
None
None		 Note:

Unsecured loans (10 years)
Secured loans (7 years)
Secured loans (7 years)
Unsecured loans (3 years)
Less: Current portion
of loans payable
$ 22,978
38,895
28,000
18,333		 
Statement 5 on Page 1

Holiday Garden International Ltd. Statement of operating cost January 1 to Decembe 31, 2019

Unit: NT$1,000

Item
Beginning foodservice inventory
Current material purchased
Transfer to operating expenses
Loss on physical inventory
Ending foodservice inventory
Current material consumed
Foodservice and accommodation cost
Loss on physical inventory		 Amount
$ 332
19,820
( 1,524)
( 6)
( 993)
17,629
34,127
6
$ 51,762		 Note: 
Statement 6 on Page 1

==> picture [517 x 249] intentionally omitted <==

----- Start of picture text -----

Holiday Garden International Ltd.
Statements of operating expenses
January 1 to Decembe 31, 2019
Unit: NT$1,000
Item Abstract Amount Note:
Salary and wage
expense $ 43,318
Miscellaneous expenses 7,693
Various depreciation 7,080
Utility expense 5,872
The balance does not exceed
Taxes 42,809 5% of this account.
$ 106,772
----- End of picture text -----

Statement 7 on Page 1

Holiday Garden International Ltd. Aggregation of employee

benefit, depreciation, and amortization expenses by function January 1 to December 31 of 2019 and 2018

Unit: NT$1,000
Function
Type		 2019 2019 2019 2018 2018 2018





Under operating
cos		 Under operating
expenses		 Total Under operating
cos		 Under operating
expenses		 Total
Employee benefit expense (See note) $9,597
$48,191
$57,788
$9,077
$43,816
$52,893
Wages and salaries 8,092
39,387
47,479
7,578
35,687
43,265
Health and labor insurance expense 890
4,014
4,904
891
3,643
4,534
Pension expense 458
1,966
2,424
460
1,848
2,308
Board of director renumeration -
1,965
1,965
-
1,800
1,800
Other employee benefit expense 157
859
1,016
148
838
986
Other employee benefit expense 21,756
7,080
28,836
22,337
7,254
29,591

Note:

  1. As of December 13, 2019 and 2018, the Company had 117 employees and 119 employees respectively, and among them, there were 5 and 4 directors respectively who were not the Company’s employees.

  2. Companies whose shares are listed on a stock exchange or traded on an over-the-counter trading center should disclose the Information as following:

(1)The average of employee benefit this year $498; he average of employee benefit last year $444.

(2)The average of employee salary this year $424; he average of employee salary last year $376.

(3)The average of employee salary adjustment 13%. 

Statement 8 on Page 1

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