LTC - Interim / Quarterly Report 2012

Lite-On Technology Corporation and Subsidiaries

Consolidated Financial Statements for the Three Months Ended March 31, 2012 and 2011 and Independent Accountants’ Review Report

INDEPENDENT ACCOUNTANTS’ REVIEW REPORT

The Board of Directors and the Shareholders Lite-On Technology Corporation

We have reviewed the accompanying consolidated balance sheets of Lite-On Technology Corporation (“Parent Company”) and subsidiaries as of March 31, 2012 and 2011, and the related consolidated statements of income and cash flows for the three months then ended. These financial statements are the responsibility of the Parent Company’s management. Our responsibility is to express an opinion on these financial statements based on our reviews.

Except as stated in the following paragraph, we conducted our reviews in accordance with Statement of Auditing Standards No. 36 - “Engagements to Review Financial Statements” of the Republic of China. A review consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

As stated in Note 2 to the consolidated financial statements, we did not review the financial statements as of and for the three months ended March 31, 2012 and 2011 of some consolidated subsidiaries. The assets of these subsidiaries were 36.90% (NT$71,658,050 thousand) and 45.68% (NT$86,168,305 thousand) of the consolidated total assets as of March 31, 2012 and 2011, respectively. The liabilities of these subsidiaries were 23.88% (NT$24,943,697 thousand) and 47.84% (NT$48,244,643 thousand) of the consolidated total liabilities as of March 31, 2012 and 2011, respectively. The operating revenues of these subsidiaries were 24.41% (NT$12,842,302 thousand) and 35.87% (NT$19,109,524 thousand) of the consolidated total operating revenues in the three months ended March 31, 2012 and 2011, respectively. The net incomes of these subsidiaries were 10.61% (NT$184,253 thousand) and 32.14% (NT$655,004 thousand) of the consolidated total net income in the three months ended March 31, 2012 and 2011, respectively. Also, as stated in Note 12 to the financial statements, the Parent Company had other investments accounted for by the equity method. The carrying values of these investments of NT$1,935,192 thousand and NT$1,588,097 thousand as of March 31, 2012 and 2011, respectively, and the consolidated equity in these investees’ net loss amounting to NT$10,028 thousand and NT$17,066 thousand in the three months ended March 31, 2012 and 2011, respectively, were based on these investees’ unreviewed financial statements for the same reporting periods as those of the Parent Company.

Based on our reviews, except for the adjustments that might have been determined to be necessary had the subsidiaries and other equity-method investees’ financial statements mentioned in the preceding paragraph been reviewed, we are not aware of any material modifications that should be made to the consolidated financial statements of Lite-On Technology Corporation and its subsidiaries as of and for the three months ended March 31, 2012 and 2011 referred to in the first paragraph for them to be in conformity with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers, the order VI-0960064020 issued by the Financial Supervisory Commission under the Executive Yuan on November 15, 2007, and accounting principles generally accepted in the Republic of China.

April 25, 2012

Notice to Readers

The accompanying consolidated financial statements are intended only to present the financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to review such consolidated financial statements are those generally accepted and applied in the Republic of China.

For the convenience of readers, the accountants’ review report and the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language accountants’ review report and consolidated financial statements shall prevail.

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS MARCH 31, 2012 AND 2011

(In Thousands of New Taiwan Dollars, Except Par Value) (Reviewed, Not Audited)

ASSETS CURRENT ASSETS Cash (Note 4) Financial assets at fair value through profit or loss - current (Notes 2, 5 and 25) Available-for-sale financial assets - current (Notes 2, 6 and 25) Notes receivable (Note 2) Accounts receivable, net (Notes 2 and 7) Accounts receivable from related parties (Notes 2 and 22) Other receivables (Note 22) Other financial assets - current Inventories, net (Notes 2 and 8) Construction in progress in excess of progressive billings (Notes 2 and 9) Deferred income tax assets - current (Note 2) Prepayments and other current assets Other current assets Total current assets LONG-TERM INVESTMENTS (Notes 2, 10, 11, 12 and 25) Available-for-sale financial assets - noncurrent Financial assets carried at cost - noncurrent Investments accounted for by the equity method Prepayments for investments Total long-term investments PROPERTIES (Notes 2 and 13) Cost Land Buildings Machinery and equipment Transportation equipment Furniture and fixtures Leasehold improvements Other equipment Total cost Less: Accumulated depreciation Accumulated impairment Construction in progress and prepayment for equipment Properties, net INTANGIBLE ASSETS (Notes 2 and 14) Trademark Goodwill, net Land use rights Other intangible assets Total intangible assets OTHER ASSETS Assets leased to others, net (Notes 2 and 15) Idle assets, net (Notes 2 and 15) Refundable deposits Deferred expense, net (Note 2) Restricted assets - noncurrent (Note 23) Total other assets TOTAL		2012 Amount % $ 56,039,996 29 21,413 - 9 - 100,600 - 41,691,385 21 79,619 - 4,266 - 1,754,568 1 26,357,700 14 43,202 - 1,032,917 1 3,613,717 2 389,545 - 131,128,937 68 1,310,157 1 1,057,780 - 3,598,181 2 9,279 - 5,975,397 3 2,741,316 2 19,223,239 10 39,614,490 20 104,656 - 2,724,186 1 1,738,763 1 3,077,750 2 69,224,400 36 32,665,407 17 762,820 - 35,796,173 19 2,154,650 1 37,950,823 20 13,567 - 14,279,428 7 575,818 - 1,445,058 1 16,313,871 8 113,232 - 135,305 - 284,886 - 2,177,178 1 106,605 - 2,817,206 1 $ 194,186,234 100		2011
				Amount % $ 50,340,887 27 57,831 - 12 - 39,354 - 39,700,016 21 116,784 - 2,862 - 1,583,965 1 24,504,976 13 93,965 - 953,994 - 3,606,693 2 343,875 - 121,345,214 64 4,086,784 2 1,743,458 1 3,234,067 2 44,393 - 9,108,702 5 2,763,986 1 18,320,754 10 32,939,159 17 108,683 - 2,719,694 1 1,826,762 1 4,925,946 3 63,604,984 33 28,495,059 15 520,290 - 34,589,635 18 2,801,624 2 37,391,259 20 18,089 - 14,749,695 8 550,732 - 1,710,670 1 17,029,186 9 117,647 - 648,643 - 330,815 - 2,549,615 2 110,246 - 3,756,966 2 $ 188,631,327 100

LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES Short-term bank loans (Note 16) Financial liabilities at fair value through profit or loss - current (Notes 2,5, and 25) Notes payable Accounts payable Accounts payable to related parties (Note 22) Income tax payable (Note 2) Accrued expenses Other payables - related parties (Note 22) Advance receipts Current portion of long-term bank loans (Note 17) Obligations under capital leases - current (Note 18) Product warranty (Note 2) Other current liabilities Total current liabilities LONG-TERM LIABILITIES, NET OF CURRENT PORTION Long-term bank loans (Note 17) Hedging derivative liabilities - noncurrent (Notes 2 and 25) Obligations under capital leases - noncurrent (Note 18) Total long-term liabilities RESERVE FOR LAND VALUE INCREMENT TAX (Note 2) OTHER LIABILITIES Accrued pension liabilities (Note 2) Guarantee deposits received Deferred income tax liabilities - noncurrent (Note 2) Deferred credits (Note 2) Total other liabilities Total liabilities SHAREHOLDERS’ EQUITY (Notes 2, 19 and 20) Capital stock, NT$10.00 par value - parent company Authorized - 3,500,000 thousand shares Issued and outstanding - 2,279,415 thousand shares in 2012 and 2,284,794 thousand shares in 2011 Advance receipts for common stock Total capital stock Capital surplus Additional paid-in capital from share issuance in excess of par value Bond conversion Treasury stock transactions Long-term stock investments Merger Employee stock options Total capital surplus Retained earnings Legal reserve Unappropriated earnings Total retained earnings Other equity Cumulative translation adjustments Net loss not recognized as pension cost Unrealized loss on financial instruments Unrealized loss on cash flow hedging Treasury stock - 2012: 27,840 thousand shares; 2011: 58,266 thousand shares Total other equity Total shareholders' equity of parent company MINORITY INTEREST Total shareholders’ equity TOTAL		2012 Amount % $ 6,646,588 3 44,006 - 449,991 - 50,478,217 26 247,777 - 1,973,948 1 10,531,460 5 28,977 - 1,228,311 1 1,268,046 1 82,520 - 1,070,886 1 5,641,290 3 79,692,017 41 22,815,014 12 139,636 - 284,149 - 23,238,799 12 239,693 - 156,652 - 80,924 - 971,034 1 84,157 - 1,292,767 1 104,463,276 54 22,794,151 12 275 - 22,794,426 12 8,421,047 4 7,540,388 4 318,777 - 922,242 1 10,120,217 5 4,876 - 27,327,547 14 7,125,313 3 13,077,348 7 20,202,661 10 495,889 - (13,964 ) - (372,382 ) - (139,636 ) - (1,104,073) - (1,134,166) - 69,190,468 36 20,532,490 10 89,722,958 46 $ 194,186,234 100		2011
				Amount % $ 4,545,298 2 165,638 - 463,825 - 50,888,342 27 192,932 - 2,366,647 1 10,262,661 5 23,026 - 1,103,217 1 3,710,826 2 87,151 - 1,146,293 1 7,026,487 4 81,982,343 43 16,722,210 9 142,454 - 357,354 - 17,222,018 9 239,693 - 160,480 - 75,905 - 1,076,982 1 93,792 - 1,407,159 1 100,851,213 53 22,847,940 12 - - 22,847,940 12 8,200,480 4 7,641,499 4 346,691 - 959,860 1 10,255,921 6 3,262 - 27,407,713 15 6,226,667 3 13,430,338 7 19,657,005 10 (611,639 ) - (3,020 ) - 763,077 - (142,454 ) - (1,857,643) (1) (1,851,679) (1) 68,060,979 36 19,719,135 11 87,780,114 47 $ 188,631,327 100

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

(With Deloitte & Touche review report dated April 25, 2012)

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME THREE MONTHS ENDED MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

OPERATING REVENUES (Notes 2 and 22) Sales Less: Sale returns Sales allowances Net sales Other operating revenues Total operating revenues OPERATING COSTS Cost of goods sold (Notes 8 and 22) Other operating cost Total operating cost GROSS PROFIT UNREALIZED INTERCOMPANY GAINS (Note 2) REALIZED GROSS PROFIT OPERATING EXPENSES (Note 22) Selling and marketing General and administrative Research and development Total operating expenses OPERATING INCOME NONOPERATING INCOME AND GAINS Interest income Investment income recognized under the equity method, net (Notes 2 and 12) Gain on disposal of properties Gain on disposal of investments, net Valuation gain on financial assets (Notes 2 and 5) Other income (Note 22) Total nonoperating income and gains		2012 Amount % $ 53,288,272 101 189,372 - 518,763 1 52,580,137 100 30,646 - 52,610,783 100 45,153,572 86 22,945 - 45,176,517 86 7,434,266 14 (14) - 7,434,252 14 2,038,838 4 1,997,614 4 1,315,516 2 5,351,968 10 2,082,284 4 177,704 - - - 3,482 - 255,409 1 80,297 - 557,903 1 1,074,795 2		2011
				Amount % $ 54,169,403 102 334,180 1 658,718 1 53,176,505 100 96,581 - 53,273,086 100 45,291,780 85 70,702 - 45,362,482 85 7,910,604 15 (9,527) - 7,901,077 15 2,215,044 4 1,916,333 4 1,197,367 2 5,328,744 10 2,572,333 5 117,233 - 6,436 - 8,208 - 657 - 189,236 - 216,158 1 537,928 1 (Continued)

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME THREE MONTHS ENDED MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

2012 Amount % $ 169,428 1 23,243 - 18,311 - 56,901 - 482,965 1 47,331 - 55,353 - 853,532 2 2,303,547 4 567,081 1 $ 1,736,466 3 $ 1,347,410 2 389,056 1 $ 1,736,466 3 2012 Before Income Tax After Income Tax $ 0.57 $ 0.60 $ 0.56 $ 0.59	2011	2011
	Amount % $ 143,084 1 - - 27,927 - 60,417 - 2,513 - 114,811 - 129,091 - 477,843 1 2,632,418 5 594,663 1 $ 2,037,755 4 $ 1,445,331 3 592,424 1 $ 2,037,755 4 2011
	2011
Before Income Tax $ 0.57 $ 0.56	Before Income Tax $ 0.67 $ 0.66	After Income Tax $ 0.65 $ 0.63

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

(With Deloitte & Touche review report dated April 25, 2012)

(Concluded)

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

CASH FLOWS FROM OPERATING ACTIVITIES Consolidated net income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation Amortization Allowance for doubtful accounts Valuation gain on financial instruments, net Loss on disposal of properties, net Investment loss (income) recognized under the equity method, net Gain on disposal of investments, net Impairment loss on assets Product warranty reserve Accrued pension liabilities Deferred income taxes Deferred credits - gain on intercompany transactions Net changes in operating assets and liabilities Financial instruments at fair value through profit or loss Notes receivable Accounts receivable Accounts receivable from related parties Other receivables from related parties Inventories Construction in progress in excess of progressive billings Prepayments Other financial assets - current Other current assets Notes payable Accounts payable Accounts payable to related parties Other payable to related parties Income tax payable Accrued expenses Advance receipts Progressive billings in excess of construction in progress Other current liabilities Net cash provided by (used in) operating activities CASH FLOWS FROM INVESTING ACTIVITIES Proceeds of disposal of bond investments with no active market Acquisition of bond investments with no active market Proceeds of disposal of available-for-sale financial assets Acquisition of properties	2012 $ 1,736,466 1,537,936 505,799 5,185 (32,966) 14,829 23,243 (255,409) 482,965 53,569 13,484 142,163 14 124,869 (18,561) 3,377,540 (78,520) (3,311) 1,053,156 (4,908) 365,163 (677,991) (34,263) (48,577) (8,878,038) (69,731) (14,081) (169,040) (494,828) 85,394 - (542,013) (1,800,462) 16,068,649 (16,040,554) 1,534,798 (1,479,939)	2011 $ 2,037,755 1,306,903 298,869 50,931 (74,425) 19,719 (6,436) (657) 2,513 126,104 6,610 (58,285) 9,527 572,421 19,179 540,253 24,620 263 1,651,830 (81,989) (344,327) 244,242 (54,830) 63,165 (5,098,708) (130,227) (7,288) (44,965) (945,926) (7,434) (44,599) 276,445 351,253 - - - (1,749,344) (Continued)

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

Proceeds of the disposal of properties Increase in deferred charge Decrease in refundable deposits Increase in land use rights Decrease in restricted assets Increase in prepayments for investments Acquisition of investments under the equity method Proceeds of the disposal of financial assets carried at cost Net cash provided by (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase in short-term bank loans Increase (decrease) in long-term bank loans Decrease in obligations under capital lease Decrease in guarantee deposits received Increase (decrease) in minority interest Proceeds of the exercise of employee stock options Net cash provided by financing activities EFFECT OF EXCHANGE RATE CHANGES NET DECREASE IN CASH AND CASH EQUIVALENTS CASH, BEGINNING OF PERIOD CASH, END OF PERIOD SUPPLEMENTARY CASH FLOW INFORMATION Interest paid (excluding capitalized interest) Income tax paid NONCASH INVESTING AND FINANCING ACTIVITIES Current portion of long-term interest-bearing liabilities CASH PAID FOR THE ACQUISITION OF PROPERTIES Increase in properties Decrease in payable for properties	2012 $ 529,302 (99,182) 30,017 (3,084) 1,502 - - - 541,509 1,976,880 (125,552) (34,157) (4,300) (209,168) 1,045 1,604,748 (821,182) (475,387) 56,515,383 $ 56,039,996 $ 499,713 $ 616,551 $ 1,350,566 $ 1,181,060 298,879 $ 1,479,939	2011 $ 20,275 (91,938) 73,870 - 3,738 (44,393) (16,715) 5,115 (1,799,392) 1,167,158 1,093,623 (33,742) (24,961) 6,075 - 2,208,153 (860,449) (100,435) 50,441,322 $ 50,340,887 $ 289,528 $ 719,930 $ 3,797,977 $ 1,496,148 253,196 $ 1,749,344

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

(With Deloitte & Touche review report dated April 25, 2012)

(Concluded)

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars, Unless Stated Otherwise) (Reviewed, Not Audited)

1. ORGANIZATION AND OPERATIONS

Lite-On Technology Corporation (the “Parent Company”) was established in March 1989. Its shares are traded on the Taiwan Stock Exchange. The Parent Company manufactures and markets (1) computer software, hardware, peripherals and components and (2) monitors, multifunction and all-in-one printers, cameras and Internet systems and image-processing equipment.

The Parent Company merged with Lite-On Electronics, Inc., Silitek Corp. and GVC Corp., with the Parent Company as the survivor entity. The merger took effect on November 4, 2002, and the Parent Company thus assumed all rights and obligations of the three merged companies on that date. The Parent Company merged with its subsidiary, Lite-On Enclosure Inc., with the Parent Company as the survivor entity. The merger took effect on April 1, 2004, and the Parent Company thus assumed all rights and obligations of the three merged companies on that date.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The consolidated financial statements have been prepared in conformity with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers and accounting principles generally accepted in the Republic of China (ROC). The preparation of financial statements in conformity with the foregoing guidelines and principles requires management to make reasonable assumptions and estimates of matters that are inherently uncertain. Actual results may differ from those estimates.

For the convenience of readers, the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language financial statements shall prevail.

The Parent Company and its subsidiaries’ (collectively referred to as the “Group”) significant accounting policies are summarized as follows:

Basis for Consolidation

As required by the revised ROC Statement of Financial Accounting Standards No. 7 - “Consolidated Financial Statements,” starting from January 2005, consolidated financial statements should include the accounts of the Parent Company and its direct and indirect subsidiaries and other investees over which the Group has controlling influence. All significant intercompany accounts and transactions have been excluded from the consolidation.

Please see Table 3 (attached) for the intercompany relationships and percentages of ownership.

The financial statements used as basis of the consolidated subsidiaries’ information and related investment amounts were unreviewed except (a) those as of and for the three months ended March 31, 2012 and 2011 of Lite-On IT Corporation, Philip & Lite-On Digital Solutions Corp., High Yield Group Co., Ltd., Lite-On IT International (HK) Ltd., Lite-On Opto Technology (Guangzhou) Co., Ltd., LET (HK) Ltd., Silitech Technology Corp., Silitech (BVI) Holding Ltd., Silitech (Bermuda) Holding Ltd., Silitech Technology Corporation Limited, Silitech (Hong Kong) Holding Ltd., Silitech Technology (SuZhou) Co., Ltd., Xurong Electronic (Shenzhen) Co., Ltd. and Logah Technology Corp.; and (b) those as of and for the three months ended March 31, 2012 of Lite-On Overseas Trading Co., Ltd., Lite-On Communications (Guangzhou) Co., Ltd., Lite-On Tech. (Guangzhou) Co., Ltd., Silitek Elec. (Guangzhou) Co. Ltd., Logah Electronics (Su Zhou) Co., Ltd., Guangzhou Lite-On Mobile Electronic Components Co., Ltd. (formerly Perlos (Guangzhou) Electronic Components Co., Ltd.) and Beijing Lite-On Mobile Electronic and Telecommunication Components Co., Ltd. (formerly Perlos (Beijing) Electronic and Telecommunication Components).

Minority interests were 56.97%, 66.69%, 42.64%, 26.47%, 15.11% and 60.37% of shareholdings in Lite-On IT Corporation, Silitech Technology Corp. Ltd., Lite-On Japan Ltd., Leotek Electronics Corporation, Lite-On Automotive Co., Ltd., and Logah Technology Co., Ltd. as of March 31, 2012, which were presented separately in the consolidated financial statements. Minority interests were 56.73%, 62.41%, 42.64%, 26.60%, 12.69% and 60.37% of shareholdings in Lite-On IT Corporation, Silitech Technology Corp. Ltd., Lite-On Japan Ltd., Leotek Electronics Corporation, Lite-On Automotive Co., Ltd., and Logah Technology Co., Ltd. as of March 31, 2011, which were presented separately in the consolidated financial statements.

The financial statements of consolidated subsidiaries are translated into New Taiwan dollars at the following exchange rates: assets and liabilities - year-end rates; shareholders’ equity - historical rates; and income and expenses - average rate during the year.

Current and Noncurrent Assets and Liabilities

Current assets include cash, financial assets held for trading and other assets to be converted to cash or to be consumed or used up within 12 months. Current liabilities include financial liabilities resulting from trading or to be repaid or settled within 12 months. All other assets and liabilities are classified as noncurrent.

Financial Assets/Liabilities at Fair Value through Profit or Loss

Financial instruments at fair value through profit or loss (FVTPL) include financial assets or liabilities for trading and financial assets and liabilities that were designated at the time of initial recognition as assets or liabilities to be measured at fair value, with changes in fair value to be recognized under earnings. Derivatives are initially recognized at fair value, with transaction costs expensed as incurred. After initial recognition, the derivatives are remeasured at fair value, and the changes in fair value are recognized in current earnings. Cash dividends received are recognized under current earnings. Regular purchase or sale of financial assets is recognized and de-recognized using trading date accounting.

Derivatives that do not meet the criteria for hedge accounting are classified as financial assets or liabilities held for trading. When the fair value of a derivative is a positive amount, the derivative is recognized as a financial asset; when the fair value is a negative amount, the derivative is recognized as a financial liability.

The fair value of stocks listed on the Taiwan Stock Exchange or traded over the counter on the GreTai Securities Market (“GreTai”) are their closing prices on the balance sheet date. For open-end funds, fair values are their net asset values on the balance sheet date. For bonds, fair values are the reference prices on GreTai on the balance sheet date. Fair values of financial instruments with no active market are estimated through valuation techniques incorporating estimates and assumptions that are consistent with those used by other market participants.

Revenue Recognition, Accounts Receivable and Allowance for Doubtful Accounts

Sales revenues are recognized when titles to products and material risks of ownerships are transferred to clients, primarily upon shipment, when the earnings process is mostly completed and the profit has been realized or is realizable. On unprocessed materials delivered to subcontractors for further processing, the Corporation does not recognize sales because this delivery does not involve a transfer of the risks and rewards of materials ownership.

Revenue is measured at the fair value of the consideration received or receivable and represents amounts agreed between the Group and the customers for goods sold in the normal course of business, net of sales discounts and volume rebates. For trade receivables due within one year from the balance sheet date, as the nominal value of the consideration to be received approximates its fair value and transactions are frequent, fair value of the consideration is not determined by discounting all future receipts using an imputed rate of interest.

Royalties are recognized when:

a. It is probable that the economic benefits of a transaction will flow to the Parent Company; and
b. The revenue can be measured reliably.

Royalties are recognized on an accrual basis in accordance with the substance of the contract.

If a contract meets the recognition criteria for sales of goods and the following conditions, royalties are recognized at the time of sale:

a. The amount of the royalties is fixed or the royalties are nonrefundable;
b. The contract is noncancelable;
c. The contract permits the licensee to exploit the assigned rights freely; and
d. The licensor has no remaining obligations to perform.

Allowance for doubtful accounts is provided on the basis of a periodic review of the collectability of receivables based on aging analysis, credit ratings and economic conditions.

As discussed in Note 3 to the financial statements, on January 1, 2011, the Group adopted the third-time revised Statement of Financial Accounting Standards (SFAS) No. 34 - “Financial Instruments: Recognition and Measurement.” One of the main revisions is that the impairment of receivables originated by the Group should be covered by SFAS No. 34. Accounts receivable are assessed for impairment at the end of each reporting period and considered to be impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the accounts receivable, the estimated future cash flows of the asset have been affected. Objective evidence of impairment could include:

a. Significant financial difficulty of the debtor;
b. Accounts receivable becoming overdue; or
c. It becoming probable that the debtor will enter into bankruptcy or undergo financial reorganization.

Accounts receivable that are assessed not to be impaired individually are further assessed for impairment on a collective basis. Objective evidence of impairment for a portfolio of accounts receivable could include the Group’s past experience of collecting payments and an increase in the number of delayed payments, as well as observable changes in national or local economic conditions that correlate with defaults on receivables.

The amount of the impairment loss recognized is the difference between the asset carrying amount and the present value of estimated future cash flows, after taking into account the related collaterals and guarantees, discounted at the receivable’s original effective interest rate.

The carrying amount of the accounts receivable is reduced through the use of an allowance account. When accounts receivable are considered uncollectible, they are written off against the allowance account. Recoveries of amounts previously written off are credited to the allowance account. Changes in the carrying amount of the allowance account are recognized as bad debt in profit or loss.

Construction Contracts

Revenues on and costs of long-term construction contracts are recognized by the percentage-of-completion method, while revenues and costs of short-term construction contracts are recognized by the full-completion method. Under the percentage-of-completion method, the stage of completion of each contract is measured at the ratio of cumulative construction costs to total estimated contract costs.

Construction revenues and costs for the current year is the excess of cumulative construction revenue and costs, determined using the percentage-of-completion method, in excess of the cumulative construction revenue and costs recognized in prior years. Any estimated loss on a construction contract is recognized currently; any subsequent adjustment of this loss is recognized as income or loss in the year of adjustment.

Construction in progress is carried at cost plus estimated construction profit or less estimated losses. Installment payments or collections received from construction projects are credited to progressive billings. Upon completion of each project, these progressive billings are offset against construction in progress.

Construction expenses incurred under the full-completion method are included in construction in progress, while collections received from construction projects are credited to progressive billings. Upon completion of each project, the construction in progress and progressive billings are recognized as construction revenues and costs, respectively.

At year-end, the balances of construction in progress and progressive billings from construction of each project are netted out, and the result is classified as current asset or current liability.

Inventories

Inventories consist of materials and supplies, work-in-process, finished goods, merchandise, goods in transit and power generation facility held for sale. Inventories are stated at the lower of cost or net realizable value. Inventory write-downs are made by item, except where it may be appropriate to group similar or related items. Net realizable value is the estimated selling price of inventories less all estimated costs of completion and costs necessary to make the sale. Inventories are recorded at standard cost and adjusted to approximate weighted-average cost on the balance sheet date.

Financial Assets Carried at Cost

Investments with no quoted market prices in an active market and with fair values that cannot be reliably measured, such as non-publicly traded stocks, are carried at their original cost. The costs of stocks sold are determined using the weighted-average method. If there is objective evidence of investment impairment, a loss is recognized, but a reversal of this impairment loss is not allowed. The accounting treatment for cash dividends and stock dividends arising from financial assets carried at cost is the same as that for cash and stock dividends arising from available-for-sale financial assets.

Bond Investments with No Active Market

Bond investments with fixed or determinable payments and with no quoted prices in an active market are carried at amortized cost using the effective interest method. Bond investments are initially measured at fair value plus transaction costs that are directly attributable to the acquisition. Profit or loss is recognized when the financial assets are derecognized, impaired, or amortized. All regular way purchases or sales of financial assets are accounted for using a trade date basis.

An impairment loss is recognized when there is objective evidence that the investment is impaired. The impairment loss is reversed if an increase in the investment’s recoverable amount is due to an event which occurred after the impairment loss was recognized; however, the adjusted carrying amount of the investment may not exceed the carrying amount that would have been determined had no impairment loss been recognized for the investment in prior years.

Available-for-sale Financial Assets

Available-for-sale financial assets are initially recognized at fair value plus transaction costs that are directly attributable to the acquisition. When the assets are subsequently measured at fair value, the changes in fair value are excluded from earnings and reported as a separate component of shareholders’ equity. The accumulated gains or losses are recognized as earnings when the financial asset is derecognized from the balance sheet. A regular purchase or sale of financial assets is recognized and derecognized using trade date accounting.

Cash dividends are recognized as investment income on the ex-dividend date but are accounted for as reductions of the original cost of investment if these dividends are declared on the investees’ earnings before investment acquisition. Stock dividends are recorded as an increase in the number of shares held and do not affect investment income. After the receipt of stock dividends, the cost per share is recalculated on the basis of the new number of total shares held. For bond securities, the difference between the initially recognized carrying values and maturity values is amortized using the effective interest method. If the difference between the results of using the straight-line method and those of the effective interest method is not material, the straight-line method can be used for amortization and subsequent differences are recognized as gain or loss.

An impairment loss is recognized on the balance sheet date if there are objective evidences that a financial asset is impaired, and this impairment loss is charged to the net income of the current period. An impairment loss for an equity instrument classified as available-for-sale can be reversed to the extent of the original carrying value and recognized as an adjustment adjustments to shareholders’ equity. If the reversible amount of a debt instrument is clearly attributable to an event occurring after the impairment loss was recognized, this amount is recognized as income.

Long-term Equity Investments

The difference between the cost of the investment and the Group’s equity in the investee’s net assets when an investment is acquired or when the equity method is first adopted, is amortized over five years. However, effective January 1, 2006, under the revised Statement of Financial Accounting Standards No. 5 - “Long-term Investments under the Equity Method,” investment premiums, representing goodwill, are no longer being amortized, but the Group needs to make asset impairment tests regularly or if there are indications that goodwill is probably impaired. If the net fair value of an asset exceeds its investment cost, the excess is used to reduce the fair value of each of the noncurrent assets acquired (exclude non-equity-method financial assets, assets for disposal, deferred tax assets and prepaid pension costs or other pension payments), with any remaining excess recognized as extraordinary gain.

If an investee issues additional shares and the Group acquires these shares at a percentage different from its current equity in the investee, the resulting increase in the Group’s equity in its investee’s net assets is credited to capital surplus. Any decrease in the Group’s equity in the investee’s net assets is debited to capital surplus. If capital surplus is not enough for debiting purposes, the difference is debited to unappropriated earnings. The equity in the net income or net loss of investees that also have investments

in the Corporation (reciprocal holdings) is computed using the treasury stock method. Upon the disposal of equity-method investments, the Corporation’s shares in the capital surplus recognized by the investee, if any, will be included in current income in proportion to the investments sold. However, capital surplus from an investee’s property disposal is transferred to retained earnings in proportion to the value of the investments sold. The Corporation accounts for its stock held by subsidiaries as treasury stock. Dividends that the Corporation distributes to its subsidiaries are debited to investment income and are credited to capital surplus - treasury stock transactions.

Profits from downstream transactions with an equity-method investee are eliminated in proportion to the Corporation’s percentage of ownership in the investee; however, if the Corporation has control over the investee, all the profits are eliminated. Profits from upstream transactions with an equity-method investee are eliminated in proportion to the Corporation’s percentage of ownership in the investee. The deferred profits are realized through the subsequent sale of the related products to third parties.

Stock dividends received are recorded only as an increase in the number of shares held but not recognized as investment income. Cost or carrying value per share is recomputed on the basis of total shares after stock dividends are received.

For all stock investments, costs of investments sold are determined using the weighted moving-average method.

Properties and Leased Assets

Properties and leased assets are stated at cost less accumulated depreciation. Major additions, renewals and betterments are capitalized, while maintenance and repairs are charged to current expense.

Assets held under capital leases are initially recognized as assets of the Group at the lower of their fair value at the inception of the lease or the present value of the minimum lease payments; the corresponding liability is included in the balance sheet as obligations under capital leases. The interest included in lease payments is expensed when paid.

Depreciation is computed using the straight-line method over useful lives estimated as follows: buildings, 5 to 60 years; machinery and equipment, 2 to 10 years; molding equipment, 2 to 10 years; transportation equipment, 3 to 10 years; office equipment, 2 to 10 years; miscellaneous equipment, 2 to 10 years; and leased assets, 3 to 40 years. Properties that - have reached their residual value but are still in use are depreciated over their newly estimated service lives.

Upon revaluation of properties, the resulting revaluation increment is recognized as part of the cost of the properties, and a reserve for land value increment tax is included in long-term liabilities, with the difference between revaluation increment and the land value increment tax credited to capital surplus.

Upon sale or other disposal of properties and leased assets, the related cost and accumulated depreciation are removed from the accounts, and the resulting gain or loss is credited or charged to nonoperating income or expense.

Intangible Assets

Intangible assets acquired are initially recorded at cost and are amortized on a straight-line basis over their estimated useful lives. Patents, client relationships and patent rights (classified under other intangible assets) are amortized over 6 years, 4 years and 12 years, respectively.

Goodwill arising from a merger or the difference between the cost of the investment and the Group’s equity in the investees’ net assets is amortized over five years using the straight line method. Effective January 1, 2006, based on the newly revised Statement of Financial Accounting Standards (SFAS) No. 5 - “Long-term Investments under the Equity Method,” goodwill is no longer amortized and is instead assessed for impairment at least annually.

Land Use Rights

Land use rights are amortized over 50 years.

Idle Assets

The idle fixed assets reclassified to other assets are stated at the lower of carrying value or net realizable value and depreciated using the straight line method from January 1, 2006.

Deferred Charges

Deferred charges, consisting of computer software costs, royalty expenditures, issuance costs of bonds and office decoration expenditures are amortized using the straight-line method over 2 to 17 years.

Asset Impairment

An impairment loss should be recognized if the carrying amount of properties, goodwill, leased assets, idle assets, deferred expenses, equity-method investments exceeds and noncurrent assets classified as held for sale, as of the balance sheet date, their recoverable amount, and this impairment loss should be charged to current income even if the asset is carried at a revalued amount. An impairment loss recognized in prior years can be reversed if there is a subsequent recovery in the estimates used to determine recoverable amount since the last impairment loss was recognized. However, an impairment loss is reversed only to the extent that it does not increase the asset carrying amount that would have been determined had no impairment loss on the asset been recognized in prior years. In addition, reversal of impairment loss on goodwill is not allowed.

Product Warranty Reserve

The estimate of the related cost is based on historical experience about product service life and warranty period.

Pension Costs

The Parent Company and subsidiaries have two types of pension plans: defined benefit and defined contribution.

Defined benefit pension costs of the Parent Company, Lite-On IT Corp., Silitech Technology Corp., Li Shin International Enterprise Corp., Logah Technology Co., Ltd., Lite-On Automotive Corp., Leotek Electronics Corp. and Philips & Lite-On Digital Solutions Corporation are recognized on the basis of actuarial calculations.

Some consolidated subsidiaries, which are mainly in investments, have either very few or even no staff. These subsidiaries have no pension plans and thus do not contribute to pension funds and recognize pension costs. Except for these companies, the consolidated subsidiaries all contribute to pension funds and recognize pension costs based on local government regulations.

Treasury Stock

The Parent Company accounts for the cost of reacquiring its outstanding stock as a deduction to arrive at shareholders’ equity.

Upon disposal of the treasury stock, the sales proceeds in excess of the cost are accounted for as capital surplus - treasury stock. If the sales proceeds are less than the cost, the difference is accounted for as a reduction in the remaining balance of capital surplus - treasury stock. If the remaining balance of capital surplus - treasury stock is insufficient to cover the difference, the remainder is recorded as a reduction of retained earnings.

If treasury stock is retired, the weighted-average cost of the retired treasury stock is written off to offset the par value and the capital surplus premium, if any, of the stock retired. If the weighted-average cost written off exceeds the sum of both the par value and the capital surplus premium, the difference is accounted for as either a reduction of capital surplus - treasury stock or a reduction of retained earnings for any deficiency where capital surplus - treasury stock is insufficient to cover the difference. If the weighted-average cost written off is less than the sum of the par value and premium, if any, of the stock retired, the difference is accounted for as an increase in capital surplus - treasury stock of the same type.

Effective January 1, 2002, the Parent Company adopted Statement of Financial Accounting Standards (SFAS) No. 30 - “Accounting for Treasury Stocks.” SFAS No. 30 requires that the shares of the Parent Company held by subsidiaries should be reclassified from investments in those subsidiaries to treasury stock. The reclassification amount was based on the carrying value of the subsidiaries’ investments in the Parent Company as of January 1, 2002.

Stock-based Compensation

Employee stock option plans had a grant or amendment date on or after January 1, 2004. Because the Parent Company did not grant new options after 2008, the accounting treatment for employee stock options is still based on the interpretations issued by the Accounting Research and Development Foundation. The Parent Company uses the intrinsic value method, under which compensation cost is recognized on a straight-line basis over the vesting year.

Income Tax

Inter-period allocation for income tax is applied. Deferred tax assets are recognized for the tax effects of deductible temporary differences, loss carryforwards, investment tax credits, and deferred tax liabilities are recognized for the tax effects of taxable temporary differences. Valuation allowance is provided for deferred income tax assets that are not certain to be realized. Deferred income tax assets or liabilities are classified as current or noncurrent in accordance with the nature of related assets or liabilities for financial reporting. But, if a deferred asset or liability cannot be related to an asset or liability in the financial statements, it is classified as current or noncurrent depending on the expected reversal date of the temporary difference.

Tax credits for certain purchases of equipment or technique, research and development, personnel training, and stock investments can be deducted from the current year’s tax expense.

Adjustments of prior years’ tax liabilities are added to or deducted from the current year’s tax provision.

Income taxes (10%) on undistributed earnings are recorded as expense in the year the shareholders resolve to retain the earnings.

Translation of Foreign-currency Financial Statements and Foreign-currency Transactions

The ROC Statement of Financial Accounting Standards No. 14 - “The Effects of Changes in Foreign Exchange Rates” applies to foreign subsidiaries that use their local currencies as their functional currencies. The financial statements of foreign subsidiaries are translated into New Taiwan dollars at the following exchange rates: Assets and liabilities - year-end rates; shareholders’ equity - historical rates; and income and expenses - average rate during the year. The resulting translation adjustments are recorded as a separate component of shareholders’ equity.

Foreign currency transactions (except derivative transactions) are recorded in New Taiwan dollars at the spot rates of exchange in effect when the transactions occur.

At the balance sheet date, foreign-currency monetary assets and liabilities are revalued using prevailing exchange rates, and the exchange differences are recognized in profit or loss.

At the balance sheet date, foreign-currency nonmonetary assets (such as equity instruments) and liabilities that are measured at fair value are revalued using prevailing exchange rates, with the exchange differences treated as follows:

a. Recognized in shareholders’ equity if the changes in fair value are recognized in shareholders’ equity; b. Recognized in profit and loss if the changes in fair value are recognized in profit or loss.

Foreign-currency nonmonetary assets and liabilities that are carried at cost continue to be stated at exchange rates at trade dates.

If the functional currency of an equity-method investee is a foreign currency, translation adjustments will result from the translation of the investee’s financial statements into the reporting currency of the Parent Company. These adjustments are accumulated and reported as a separate component of shareholders’ equity.

Hedging Derivative Financial Instruments

Hedging derivative financial instruments are measured at fair value. The changes in fair values of these instruments are debited or charged to either shareholders equity or current income depending on the hedged items.

Hedge Accounting

Hedge accounting recognizes the offsetting effects on profit or loss of changes in the fair values of the hedging instrument and the hedged item as follows:

a. Fair value hedge: The gain or loss from remeasuring the hedging instrument at fair value and the gain or loss on the hedged item attributable to the hedged risk are recognized in profit or loss.
b. Cash flow hedge: The portion of the gain or loss on the hedging instrument that is determined to be an effective hedge is recognized in shareholders’ equity. The amount recognized in shareholders’ equity is recognized in profit or loss in the same year or years during which the hedged forecast transaction or an asset or liability arising from the hedged forecast transaction affects profit or loss. However, if all or a portion of a loss recognized in shareholders’ equity is not expected to be recovered in the future, the amount that is not expected to be recovered is reclassified into profit or loss.
c. Hedge of a net investment in a foreign operation: The portion of the gain or loss on hedging instruments that is determined to be an effective hedge is recognized in shareholders’ equity but is recognized as gain or loss on foreign operation disposal.

The Parent Company and its subsidiaries use hedging to stabilize net interest income or expense and control market value risk. Cash flow hedge is used to reduce interest rate risk, while fair value hedge is used to reduce net present value risk of the hedged item.

3. ACCOUNTING CHANGES

Financial Instruments

On January 1, 2011, the Parent Company and its subsidiaries adopted the newly revised Statement of Financial Accounting Standards (SFAS) No. 34 - “Financial Instruments: Recognition and Measurement.” The main revisions include (1) finance lease receivables are now covered by SFAS No. 34; (2) the scope of the applicability of SFAS No. 34 to insurance contracts is amended; (3) loans and receivables originated by the Parent Company and its subsidiaries are now covered by SFAS No. 34; (4) additional guidelines on impairment testing of financial assets carried at amortized cost when a debtor has financial difficulties and the terms of obligations have been modified; and (5) accounting treatment by a debtor for modifications in the terms of obligations. This accounting change had no significant effect on the Parent Company and its subsidiaries.

Operating Segments

On January 1, 2011, the Parent Company and its subsidiaries adopted the newly issued SFAS No. 41 - “Operating Segments.” The statement requires that segment information be disclosed on the basis of information about the components of the Group that management uses to make operating decisions. SFAS No. 41 requires the identification of operating segments on the basis of internal reports that are regularly reviewed by the Parent Company and its subsidiaries’ chief operating decision maker in order to allocate resources to the segments and assess their performance. This statement supersedes SFAS No. 20 - “Segment Reporting,” and the Parent Company and its subsidiaries conformed to the disclosure requirement and provided the operating segment disclosure in the consolidated financial statements accordingly.

4. CASH AND CASH EQUIVALENTS

Cash on hand Checking deposits Demand deposits Time deposits		March	31
		2012 $ 9,273 1,401,755 22,359,121 32,269,847 $ 56,039,996	2011 $ 10,400 2,155,214 23,044,949 25,130,324 $ 50,340,887

As of March 31, 2012 and 2011, the bank deposits overseas of the Parent Company were as follows:

Czech - Prague (CZK85,002 thousand in 2012 and CZK52,217 thousand in 2011) Germany - Nuremburg (EUR77 thousand in 2012 and EUR 2 thousand in 2011) Poland - Warsaw (PLN16 thousand in 2012 and PLN1,014 thousand in 2011)		March 31	March 31
		2012 $ 92,628 3,031 154 $ 95,813	2011 $ 88,690 83 10,538 $ 99,311

5. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

The Parent Company’s trading-purpose assets were as follows:

Financial assets resulting from trading Forward exchange contracts Currency swap contracts Options-call Financial liabilities resulting from trading Currency swap contracts Forward exchange contracts Interest rate swap contracts Options-put		March 31	March 31
		2012 $ 15,337 6,076 - $ 21,413 $ 26,366 17,402 238 - $ 44,006	2011 $ 6,549 51,280 2 $ 57,831 $ 99,225 38,243 681 27,489 $ 165,638

The subsidiaries’ significant outstanding forward contracts, currency swap contracts, interest rate swap contracts, and options as of March 31, 2012 and 2011 were as follows:

Currency Maturity Amount (Thousands)

March 31, 2012

Lite-On IT Corp.

Forward exchange contracts

Forward exchange contracts Forward exchange contracts Currency swap contracts

EUR/USD April 5, 2012 - EUR12,000/USD15,811 May 7, 2012 RMB/USD September 10, 2012 RMB63,140/USD10,000 USD/RMB September 10, 2012 USD10,000/USD63,310 USD/NTD April 19, 2012 - USD149,000/NTD4,398,848 May 7, 2012

Silitech Technology Corp.

Forward exchange contracts Currency swap contracts Logah Technology Co., Ltd. Forward exchange contracts

USD/MYR April 19, 2012 - USD100/MYR305 May 9, 2012 USD/NTD April 9, 2012 USD28,000/NTD825,160

USD/NTD April 5, 2012 - USD6,000/NTD176,476 April 9, 2012

Lite-On Automotive Corp.

Forward exchange contracts

EUR/NTD August 1, 2012 EUR487/NTD18,925 (Continued)

	Currency	Maturity	Amount (Thousands)
Lite-On Automotive Electronics
(Guang Zhou) Co., Ltd.
Forward exchange contracts	USD/RMB	September 4, 2012	USD980/RMB6,161
Forward exchange contracts	EUR/RMB	May 4, 2012	EUR600/RMB5,031
Lite-On Mobile Oyj
Currency swap contracts	USD/EUR	April 13, 2012	USD12,650/EUR9,597
Currency swap contracts	EUR/USD	April 13, 2012	EUR2,000/USD2,637
Currency swap contracts	HUF/EUR	April 20, 2012	HUF250,000/EUR810
Currency swap contracts	SEK/EUR	April 20, 2012	SEK3,000/EUR339
Forward exchange contracts	JPY/USD	April 17, 2012	JPY50,000/USD638
Forward exchange contracts	USD/BRL	April 23, 2012	USD4,000/BRL7,362
Forward exchange contracts	USD/RMB	April 9, 2012	USD20,000/RMB125,660
Forward exchange contracts	EUR/RMB	April 23, 2012	EUR3,000/RMB24,856
Forward exchange contracts	USD/INR	April 13, 2012	USD10,000/INR504,200
Leotek Electronic Corp.
Currency swap contracts	USD/NTD	April 23, 2012	USD900/NTD26,469
Forward exchange contracts	USD/NTD	April 25, 2012	USD2,000/NTD59,046
Lite-On Singapore Pte. Ltd.
Forward exchange contracts	EUR/USD	April 5, 2012	EUR2,400/USD3,192
Forward exchange contracts	JPY/USD	May 4, 2012	JPY66,000/USD804
			(Concluded)
			Range of
		Range of	Interest
Amount		Interest	Rates Settlement
(Thousands)	Maturity	Rates Paid	Received Term
Lite-On Japan Ltd.
Interest rate swap JPY100,000	February 4, 2008 - 1.48%		Note Quarterly
contracts	January 31, 2013
	Currency	Maturity	Amount (Thousands)
March 31, 2011
Lite-On IT Corp.
Forward exchange contracts	EUR/USD	April 15, 2011	EUR12,000/USD17,004
Forward exchange contracts	USD/EUR	April 15, 2011	USD4,271/EUR3,000
Forward exchange contracts	USD/NTD	April 18, 2011	USD5,000/NTD147,405
Currency swap contracts	USD/NTD	April 8, 2011 -	USD184,000/NTD5,424,460
		May 18, 2011

(Continued)

	Currency	Maturity	Amount (Thousands)
Silitech Technology Corp.
Forward exchange contracts	EUR/USD	April 14, 2011 -	EUR2,000/USD2,759
		April 21, 2011
Currency swap contracts	USD/NTD	April 8, 2011	USD12,000/NTD354,840
Lite-On Green Technologies Inc.
Forward exchange contracts	EUR/USD	April 29, 2011	EUR2,200/USD2,104
Lite-On Electronic (Thailand)
Co., Ltd.
Forward exchange contracts	USD/THB	June 29, 2011	USD2,000/THB61,340
Logah Technology Co., Ltd.
Forward exchange contracts	USD/NTD	April 15, 2011 -	USD14,500/NTD423,548
		May 27, 2011
Lite-On Automotive Corp.
Forward exchange contracts	USD/RMB	April 8, 2011	USD1,800/RMB11,792
Forward exchange contracts	EUR/RMB	April 28, 2011	EUR709/RMB9,624
Lite-On Japan Ltd.
Currency swap contracts	JPY/USD	March 5, 2012	JPY135,600/USD1,200
Call option	JPY/USD	March 5, 2012	JPY135,600/USD1,200
Put option	JPY/USD	March 5, 2012	JPY376,200/USD3,600
Lite-On Mobile Oyj
Currency swap contracts	JPY/EUR	April 4, 2011	JPY100,000/EUR871
Currency swap contracts	USD/EUR	April 13, 2011	USD17,500/EUR13,339
Currency swap contracts	MXN/USD	April 13, 2011	MXN30,000/USD2,465
Currency swap contracts	JPY/USD	April 20, 2011	JPY30,000/USD371
Currency swap contracts	EUR/USD	May 10, 2011	EUR3,300/USD4,643
Currency swap contracts	HUF/EUR	May 23, 2011	HUF250,000/EUR907
Currency swap contracts	SEK/EUR	May 23, 2011	SEK9,000/EUR999
Forward exchange contracts	JPY/USD	April 20, 2011	JPY50,000/USD618
Forward exchange contracts	USD/BRL	April 21, 2011	USD3,000/BRL5,133
Forward exchange contracts	USD/RMB	April 25, 2011	USD9,000/RMB58,914
Forward exchange contracts	EUR/RMB	May 17, 2011	EUR 2,000/RMB18,267
Forward exchange contracts	USD/INR	May 27, 2011	USD10,000/INR453,900
			(Continued)

	Currency		Maturity	Amount	(Thousands)
Beijing Lite-On Mobile Electronic and
Telecommunication Components
Co., Ltd.
Forward exchange contracts	USD/RMB	April	14, 2011	USD2,000/RMB13,120
Forward exchange contracts	JPY/USD	April	14, 2011	JPY305,011/USD3,684
Guangzhou Lite-On Mobile Electronic
Components Co., Ltd.
Forward exchange contracts	USD/CNY	April	20, 2011	USD2,000/CNY13,159
Lite-On Singapore Pte. Ltd.
Forward exchange contracts	EUR/USD	April	7, 2011	EUR5,000/USD6,907
Forward exchange contracts	JPY/USD	April	7, 2011	JPY94,000/USD1,144
Forward exchange contracts	HUF/USD	April	7, 2011	HUF384,000/USD1,949
Forward exchange contracts	SGD/USD	April	7, 2011	SGD900/USD709
					(Concluded)
				Range of
			Range of	Interest
Amount			Interest	Rates	Settlement
(Thousands)	Maturity		Rates Paid	Received	Term
Lite-On Japan Ltd.
Interest rate swap JPY200,000	February 4, 2008 -		1.48%	Note	Quarterly
contracts	January 31, 2013

Note: Based on the Taipei interbank offered rate (Tibor) for three month plus a margin of 0.35%.

The subsidiaries entered into derivative contracts during the three months ended March 31, 2012 and 2011 to manage exposures due to fluctuations of foreign exchange rates. The derivative contracts entered into by the subsidiaries did not meet the criteria for hedge accounting. Thus, the derivative contracts classified as financial assets or financial liabilities at fair value through profit or loss. The financial risk management objectives of the subsidiaries were to minimize risks due to changes in fair value or cash flows.

Net losses and gains on derivative financial instruments as of March 31, 2012 and 2011 were $32,966 thousand and $74,425 thousand, respectively.

6. AVAILABLE-FOR-SALE FINANCIAL ASSETS - CURRENT

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March 31
2012 2011
Domestic quoted stocks $ 9 $ 12
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7. ACCOUNTS RECEIVABLE, NET

Accounts receivable Allowance for doubtful accounts Allowance for sales returns and discounts		March	31
		2012 $ 42,414,475 (277,270) (445,820) $ 41,691,385	2011 $ 40,344,408 (466,409) (177,983) $ 39,700,016

Movements of allowances for doubtful accounts were as follows:

Three Months Ended March 31 2012 2011 Accounts Receivable Overdue Receivable Accounts Receivable Overdue Receivable Balance, beginning of year $ 270,049 $ 187,491 $ 416,384 $ 64,204 Allowance (reversal of allowance) for doubtful accounts 5,185 - 51,618 (687) Amounts written off (324) (1,527) - (58,938) Reclassification from Overdue Receivable (18,115 (18,115) - - Effect of exchange rate changes (15,755) (17,078) (1,593) - $ 277,270 $ 150,771 $ 466,409 $ 4,579 Overdue receivables were classified under other assets, an allowance for doubtful accounts fully covered these receivables (please refer to Note 15). The unexpired factored accounts receivable of the Parent Company and its subsidiaries as of March 31, 2012 and 2011 were as follows: The Parent Company Factor Receivables Sold Amounts Collected Advances Received at Year-end Interest Rates for Advances Received (%) Credit Line March 31, 2012 None March 31, 2011 Taishin International Bank US$ 400 US$ 396 $ - Note $ 160,000		Three Months Ended March 31	Three Months Ended March 31	Three Months Ended March 31
				2011

Overdue receivables were classified under other assets, an allowance for doubtful accounts fully covered these receivables (please refer to Note 15).

The unexpired factored accounts receivable of the Parent Company and its subsidiaries as of March 31, 2012 and 2011 were as follows:

Philips & Lite On Digital Solutions Corp.

					Advances	Interest Rates
	Receivables		Amounts		Received at	for Advances
Factor		Sold	Collected		Year-end	Received (%)	Credit Line
March 31, 2012
Taishin International Bank	US$	2,627	US$	1,970	US$ 657	0.17-0.188	US$	8,500
March 31, 2011
Taishin International Bank	US$	4,918	US$	3,306	US$ 1,612	0.17-0.19	US$	13,500

Silitech Technology Corp.

						Advances	Advances	Interest Rates
		Receivables		Amounts		Received at		for Advances
	Factor	Sold		Collected		Year-end		Received (%)	Credit Line
March 31,	2012
City Bank		EUR	976	EUR	3,904	EUR	870	1.47-1.81	US$	30,000
		US$	6,985	US$	5,464	US$	5,723	1.78-1.85
March 31,	2011
City Bank		RMB	-	RMB	3,967	RMB	-	-	US$	9,000
		EUR	9,404	EUR	9,044	EUR	7,685	1.63-1.84
		US$	9,492	US$	10,139	US$	8,595	0.96-0.97	US$	34,000

The above credit lines may be used on a revolving basis. As of March 31, 2012, the amount of factored accounts receivable of the Parent Company and its subsidiaries remaining in 2011 had been collected.

Factored accounts receivable of the Parent Company and its subsidiaries amounted to USD9,612 thousand, EUR976 thousand in March 31, 2012; USD14,410 thousand and EUR9,404 thousand in March 31, 2011.

The Parent Company and its subsidiaries (Philips & Lite-On Digital Solutions Corp. and Silitech Technology Corp.) signed accounts receivable factoring contracts with banks. Under these contracts, the risks on the accounts receivable were transferred to the banks.

8. INVENTORIES, NET

Materials and supplies Work in process Finished goods Merchandise Goods in transit Power generation facility held for sale		March	31
		2012 $ 6,438,080 3,473,685 9,391,776 3,847,643 1,499,780 1,706,736 $ 26,357,700	2011 $ 7,330,854 2,987,925 5,722,330 5,432,117 1,201,191 1,830,559 $ 24,504,976

As of March 31, 2012 and 2011, the allowances for inventory devaluation were $1,856,868 thousand and $1,520,993 thousand, respectively.

The costs of inventories recognized as cost of sales were $45,153,572 thousand and $45,291,780 thousand as of March 31, 2012 and 2011, respectively.

9. CONSTRUCTION IN PROGRESS IN EXCESS OF PROGRESSIVE BILLINGS

Item March 31, 2012 Solar Power project March 31, 2011 Solar Power project	Contract Cost I $596,624 $570,528	Cost ncurred to Date C $475,679 $351,592	Estimated Costs to Complete onstruction C i $ 73,073 $152,023	onstruction n Progress Progressive Billings Percentage of Completion (%) Estimated Completion Year Gross Profit to Be Recognized $521,250 $478,048 80-100 2012 $ 45,571 $401,419 $307,454 90-100 2012 $ 49,827

10. AVAILABLE-FOR-SALE FINANCIAL ASSETS - NONCURRENT

Domestic quoted stocks Overseas quoted stocks Mutual funds		March 31	March 31
		2012 $ 1,060,976 153,385 95,796 $ 1,310,157	2011 $ 2,678,467 687,774 720,543 $ 4,086,784

11. FINANCIAL ASSETS CARRIED AT COST

Domestic and overseas unquoted common stocks Emerging market stocks		March 31	March 31
		2012 $ 619,827 437,953 $ 1,057,780	2011 $ 1,305,505 437,953 $ 1,743,458

The above stocks and funds had no quoted price in an active market or reliable fair values; thus, these investments were measured at cost.

Some of the Group’s financial assets carried at cost - noncurrent as of the three months ended March 2012 were impaired. Thus, impairment losses were recognized as follows:

	Three Months
	Ended
	March 31, 2012
Auria Solar Co., Ltd.	$ 460,187
Compound Solar Technology Co., Ltd.	10,000
	$ 470,187

12. INVESTMENTS ACCOUNTED FOR BY THE EQUITY METHOD

Long-term stock investments Equity method Listed Lite-On Semiconductor Corp. Jhen Vei Electronics Co., Ltd. Unlisted Dragonjet Corporation LiteStar JV Holding (BVI) Co., Ltd. Epricrystal (Changzhou) Co., Ltd. Lite-Space Technology Company Limited Kompaktsolar GmbH Canfield Ltd.		March 31	March 31	March 31
		2012 % of Carrying Owner- Value ship $ 1,557,042 20.45 105,947 17.12 1,662,989 990,942 29.74 760,237 30.00 140,354 5.00 22,995 27.00 17,010 51.00 3,654 33.33 1,935,192 $ 3,598,181		2011
				% of Carrying Owner- Value ship $ 1,512,895 20.31 133,075 17.12 1,645,970 1,041,564 29.83 531,217 30.00 - - - - 12,042 51.00 3,274 33.33 1,588,097 $ 3,234,067

Although Li Shin International Enterprise Corp. (“Li Shin”) held less than 20% of the total voting shares of Jhen Vei Electronics Co., Ltd. (“Jhen Vei”), Li Shin’s holding was still significantly higher than that of any other shareholder and was thus deemed to have significant influence over Jhen Vei’s. As a result, Li Shin used the equity method to account for its investment in Jhen Vei.

Lite-On Electronic (Tianjin) Co., Ltd., a subsidiary of the Parent company, held less than 20% of the equity interest in Epricrystal (Changzhou) Co., Ltd. (“Epricrystal”), but a equity-method investee of the Parent company, LiteStar JV Holding (BVI) Co., Ltd. owned more than 20% interest of Epricrystal, enabling the Group to exercise significant influence. Thus, the Group accounted for this investment by the equity method.

In January 2011, Lite-On Green Technologies B.V. (LOGTBV), a subsidiary of the Parent company, signed a joint venture contract with Kompakt Betriebs and Verwaltungs GmbH, and formed the Company named Kompaktsolar GmbH (“Kompak”). Under the contract, LOGTBV had no controlling interest over the financial, operating and personnel hiring policy decisions but owned 51%. Thus, the Group accounted for this investment by the equity method. LOGTBV was not included in the accompanying consolidated financial statements but the proportional consolidation method was applied to this investee.

As of March 31, 2012 and 2011, the book values of the long-term equity-method investees whose financial statements had not been reviewed by auditors were $1,935,192 thousand and $1,588,097 thousand as of March 31, 2012 and 2011, respectively; the net investment results recognized were a loss of $10,028 thousand and $17,066 thousand as of March 31, 2012 and 2011. (The financial statements as of and for the three months ended March 31, 2012 and 2011 of two equity-method investees, Lite-On Semiconductor Corp. and Jhen Vei Electronics Co., Ltd., had been reviewed.)

13. PROPERTIES

Accumulated depreciation consisted of the following:

Buildings Machinery and equipment Transportation equipment Office equipment Leased equipment Miscellaneous equipment		March	31
		2012 $ 5,551,175 21,456,002 80,124 1,999,319 1,264,189 2,314,598 $ 32,665,407	2011 $ 4,730,140 15,671,981 79,055 1,989,200 1,285,453 4,739,230 $ 28,495,059

Depreciation expenses were $1,537,936 thousand in March 31, 2012 and $1,306,903 thousand in March 31, 2011.

Some of the Group’s properties as of the three months ended March 2012 and 2011 were impaired. Thus, impairment losses (reversal of impairment loss) were recognized as follows:

Lite-On Technology (Europe) Co., Ltd. Lite-On Technology Co. Lite-On Electronic (Tianjin) Co., Ltd. Lite-On Automotive Corp.	Three Months Ended March 31	Three Months Ended March 31
		2012 2011 $ 10,942 $ - 1,046 - - 1,870 - ( 2,438) $ 11,988 ($ 568)

14. INTANGIBLE ASSETS

a. Patents and other intangible assets

The Parent Company completed the purchase of some assets of the IrDA Department of Avago Technologies Limited. Statement of Financial Accounting Standards (SFAS) No. 25 - “Business Combinations” and SFAS No. 37 - “Intangible Assets” define recognized goodwill as the sum of the acquisition cost plus other direct transaction costs minus the fair value of the identifiable net assets acquired. Thus, the calculation of goodwill generated as of December 31, 2009 was as follows:

Acquisition costs Fair value of identifiable assets acquired Inventories Properties Patents Client relationships (recognized as other intangible assets) Goodwill	$ 59,278 46,700 27,134 163,819	$ 708,863 296,931
		$ 411,932

As of the three months ended March 2012 and 2011, the amounts amortized for patents, which have an estimated service life of six years, were $13,567 and $9,045 thousand, respectively, and those for client relationships, which have an estimated service life of four years, were $122,864 and $81,909 thousand, respectively.

On April 10, 2006, Lite-On IT Corporation (LOITC) and Qisda Corp. (“Qisda”) signed a contract, under which LOITC will obtain Qisda’s subcontract and manufacturing business on optical storage devices, including related authorization on product manufacturing, technology, technology acquisition, patent rights, etc. for $1,226,855 thousand plus 13% equity in LOITC. This acquisition was in line with LOITC’s long-term strategic relationship with Qisda to expand production scale and promote market share.

In their special meeting on November 15, 2007, however, LOITC’s shareholders approved the board of directors’ proposal of August 27, 2007 to cancel the plan to use LOITC’s shares to make the payment and to negotiate instead with Qisda for a new payment mode (i.e., wholly pay in cash) and schedule. LOITC thus paid cash for its acquisition at these amounts: $2,695,878 thousand, recorded under intangible assets - patent rights; and $2,806,508 thousand, recorded under goodwill.

As of the three months ended March 2012 and 2011, the accumulated amortization for patent rights amounted to $1,291,775 thousand and $1,067,118 thousand, respectively.

b. Goodwill

The amortization period for goodwill resulting from the Parent Company’s acquisition of Lite-On Enclosure Inc. in 2004 was approximately five years. However, under the Guidelines Governing the Preparation of Financial Reports, effective January 1, 2006, goodwill need no longer be amortized. As of December 31, 2011 and 2010, the carrying value of goodwill was $132,986 thousand.

Except for the goodwill generated through the acquisition of Lite-On Enclosure Inc. by the Parent Company for $132,986 thousand, the Parent Company’s purchase of some assets of IrDA Department of Avago Technologies Limited for $411,932 thousand, and the goodwill carrying value of $2,806,508 thousand recognized by Lite-On IT Corp., resulted in differences between the acquisition costs of the Parent Company’s investments in the subsidiaries and the acquisition costs of the subsidiaries’ investments in other companies; the Company’s proportionate share in the investees’ equity are listed as follows:

Lite-On Mobile Oyj Li Shin International Enterprise Corp. Lite-On Automotive Corp. Leotek Electronics Corp. Philips & Lite-On Digital Solutions Germany GmbH. Others		March	31
		2012 $ 8,614,609 1,708,258 303,073 219,424 - 82,638 $ 10,928,002	2011 $ 8,649,288 1,708,258 305,708 219,424 455,427 60,164 $ 11,398,269

From January 1, 2006, based on the revised of the Statement of Financial Accounting Standards No. 5 - “Long-term Investments under the Equity Method,” goodwill should no longer be amortized but should be tested for impairment at regular intervals every year. For this test, the recoverable amount should be evaluated by the value in use of the tangible and intangible assets of the Parent Company and the subsidiaries’ optical storage devices, and the projected cash flows during the period of the expected use of these devices should be considered. Some factors to consider in assessing value in use are past operating performance, future profit situation under normal operations, operating strategies, industrial development goals on CD-ROM drives, market prospects, etc. Net cash input and the number of residual assets should be estimated, and the value in use of these assets should be calculated net of their weighted average capital cost.

In December 2011, Lite-On IT Corp. had recognized an impairment loss on its subsidiary, Philips & Lite-On Digital Solutions Germany GmbH, because the recoverable amount of goodwill was estimated to be less than its carrying amount. Besides, no other investment impairment loss was recognized by the Group.

15. OTHER ASSETS

a. Leased assets, net (operating lease)

Leotek Electronics Corp. and Li Shin International Enterprise leased out their land, buildings and office equipment as follows:

	March 31	March 31
	2012 2011 $ 37,767 $ 37,766 91,247 94,821 129,014 132,587 (15,782) (14,940) $ 113,232 $ 117,647 March 31
2012 $ - 143,778 299,892 - 12,376 140,325 596,371 (302,443) (158,623) $ 135,305 2012 $ 160,967 790 - (3,133) $ 158,624		2011 $ 6,036 495,254 1,274,543 3,778 46,961 123,285 1,949,857 (1,046,258) (254,956) $ 648,643 2011 $ 203,227 3,081 48,648 - $ 254,956

b. Idle assets, net

c. Overdue receivables

Overdue receivables Allowance for doubtful accounts		March 31	March 31
		2012 $ 150,771 (150,771) $ -	2011 $ 4,579 (4,579) $ -

16. SHORT-TERM BANK LOANS

Unsecured bank loans - interest 1.03-8.24% in 2012 and 0.57-9.25% in 2011		March 31	March 31
		2012 $ 6,646,588	2011 $ 4,545,298

17. LONG-TERM BANK LOANS (INCLUDING CURRENT PORTION)

Parent Company Lite-On Mobile Pte. Ltd. Silitech Technology Corp. Lite-On Japan Ltd. Silitech Technology (Su Zhou) Co., Ltd. Lite-On Mobile Oyj Current portion of long-term bank loans		March	31
		2012 $ 15,700,000 5,887,443 1,608,000 592,685 294,932 - 24,083,060 (1,268,046) $ 22,815,014	2011 $ 14,166,667 - 2,010,000 600,458 321,343 3,334,568 20,433,036 (3,710,826) $ 16,722,210

a. As of March 31, 2012, the Parent Company had four long-term bank loans with contract terms between September 23, 2008 and October 19, 2016 and an interest rate of 1.485% to 1.661%, payable monthly or quarterly. These loans should be repaid in three, five, or eight installments or at lump sum on loan maturity.

As of March 31, 2011, the Parent Company had two long-term loans with contract terms between July 31, 2008 and September 23, 2013 and an interest rate of 1.238% to 1.44%, payable monthly or quarterly. These loans should be repaid in 5 or 12 installments from their due dates.

On September 23, 2008, the Parent Company signed the contract for a five-year syndicated loan with Citibank and 15 other financial institutions, and on May 16, 2011 changed the contract period to seven years from 2008. The repayment period is between September 23, 2008 and September 22, 2015. The credit line is NT$15 billion, consisting of:

1) NT$12 billion, which is a refinancing of existing credit lines to improve financial structure and which should be used as a medium-term loan but may not be used on a revolving basis; and
2) NT$3 billion, which is for supporting operations and may be used on a revolving basis.

The principal of this syndication loan should be repaid in five semiannual installments from September 23, 2013, and the interest rate is the 90-day Taiwan subprime commercial paper interest rate plus 55 points.

Under the syndicated loan agreement, the Parent Company should maintain certain financial ratios based on the most recent semiannual or annual consolidated financial statements. As of March 31, 2012 and 2011, the Parent Company was in compliance with all of the loan covenants.

b. Lite-On Mobile Pte. Ltd. had a syndicated loan, with a contract term from April 29, 2011 to April 29, 2016. The floating interest rates was 1.07365% to 2.2% as of March 31, 2012, and principal repayable from April 29, 2014 in five semiannual installments.

This contract is a five-year syndicated loan of US$200 million and was signed with Citibank and 14 other financial institutions (the endorsements and guarantees were provided by the Parent Company). As of March 31, 2012, Lite-On Mobile Pte. Ltd. had used all of the credit line of the syndicated loan.

c. Silitech Technology Co., Ltd. entered into a NT$3 billion syndicated loan with Taiwan Landbank, with a contract term from March 16, 2009 to March 16, 2014. This loan was obtained for the purpose of supporting operations and consummating the acquisition. As of March 31, 2012 and 2011, Silitech Technology Corporation had used NT$2.01 billion and NT$1.2 billion, respectively, of the credit line of the syndicated loan, with interest rates of 1.6744% and 1.4736% to 1.4767%, respectively and principal repayable from December 16, 2011 in 10 quarterly installments.
d. As of March 31, 2012 and 2011, Lite-On Japan Ltd. had eighteen long-term bank loans, with contract terms from November 10, 2006 to February 29, 2016, with interest rate of 1.16% to 1.75% and principal repayable on specified due dates.
e. Silitech Technology (Su Zhou) Co., Ltd. entered into a US$10 million long-term bank loan with Taipei Fubon Bank, with contract term from August 27, 2010 to August 27, 2013. The floating interest rates were 1.2406% and 1.0605% as of March 31, 2012 and 2011, respectively; principal is amortized semiannually and repaid at US$3,000 thousand for each of the first two installments and at US$4,000 thousand on the third repayment. As of March 31, 2012, Silitech Technology (Su Zhou) Co., Ltd. had used all of the credit line of the loan.
f. On March 31, 2011, Lite-On Mobile Oyj had a long-term bank loan contract, which will mature on September 23, 2013. The floating interest rate was 1.5255% as of March 31, 2012, with principal repayable from December 31, 2012 in five semiannual installments. In June 2011, Lite-On Mobile Oyj fully repaid this loan.

18. OBLIGATIONS UNDER CAPITAL LEASES

Guangzhou Lite-On Mobile Electronic Components Co., Ltd. (formerly Perlos (Guangzhou) Electronic Components Co., Ltd.) Beijing Lite-On Mobile Electronic and Telecommunication Components Co., Ltd. (formerly Perlos (Beijing) Electronic and Telecommunication Components) Lite-On Mobile Oyj Lite-On Mobile Sweden AB (formerly Perlos AB)	March 31
	2012 2011 $ 332,859 $ 368,253 29,406 64,556 1,864 2,524 1,409 3,740 (Continued)

The Parent Company Lite-On Mobile India Private Limited. (formerly Perlos Telecommunication and Electronic Components (India) Private Ltd. Shenzhen Lite-On Mobile Precision Molds Co., Ltd. (formerly Perlos Precision Molds (Shenzhen) Co., Ltd. Lite-On (Guangzhou) Infortech Co., Ltd. Current portion of long-term capital lease liabilities		March 31	March 31
		2012 $ 867 264 - - 366,669 (82,520) $ 284,149	2011 $ 2,127 1,418 1,200 687 444,505 (87,151) $ 357,354 (Concluded)

a. Guangzhou Lite-On Mobile Electronic Components Co., Ltd. (formerly Perlos (Guangzhou) Electronic Components Co., Ltd.) leased buildings, machinery and equipment under capital leases valid from January 1, 2007 to December 31, 2016. The terms of these leases were between 3 and 10 years, with 7.11% interest rate. The building, machinery and equipment can be bought at a bargain purchase price at the end of the lease term.
b. Beijing Lite-On Mobile Electronic and Telecommunication Components Co., Ltd. (formerly Perlos (Beijing) Electronic and Telecommunication Components) - leased building under capital leases from January 1, 2003 to December 31, 2012. The terms of these leases were 10 years, 4.24% interest rate. The building can be bought at a bargain purchase price at the end of the lease term.
c. Lite-On Mobile Oyj leased machinery and equipment under capital leases valid from February 1, 2009 to September 30, 2015. The terms of these leases were between 3 and 4 years, with 5.00% interest rate.
d. Lite-On Mobile Sweden AB (formerly Perlos AB) leased machinery and equipment under capital leases valid from June 15, 2008 to January 15, 2013. The terms of these leases were between 2 and 4 years, with 2.79% to 12.83% interest rate
e. The Parent Company leased machinery and equipment under capital leases valid from September 1, 2009 to June 1, 2013. The terms of these leases were between 3 and 5 years, with 15.6% interest rate. The payments of these leases were between $42 thousand and $120 thousand. The ownership of the leased assets will be transferred to the Parent Company at the end of the lease term.
f. Lite-On Mobile India Private Limited. (formerly Perlos Telecommunication and Electronic Components (India) Private Ltd.) leased machinery and equipment under capital leases valid from September 15, 2009 to April 18, 2013. The terms of these leases were between three and five years, with 10.24% interest rate. The machinery and equipment can be bought at a bargain purchase price at the end of the lease term.
g. Shenzhen Lite-On Mobile Precision Molds Co., Ltd. (formerly Perlos Precision Molds (Shenzhen) Co., Ltd.) leased machinery and equipment under capital leases valid from July 1, 2009 to December 31, 2011. The terms of these leases were 2 and behalf years, with 11.38% interest rate. The machinery and equipment were then bought at a bargain purchase price at the end of the lease term.
h. Lite-On (Guangzhou) Infortech Co., Ltd. leased machinery and equipment under capital leases valid from June 15, 2006 to November 29, 2011. The terms of these leases were 4 years, with 3.11% to 5.56% interest rate. The machinery and equipment were then bought at a bargain purchase price at the end of the lease term.

19. SHAREHOLDERS’ EQUITY

On September 25, 1996, the Parent Company issued 4,900 thousand units of global depositary receipts (GDRs) on the London Stock Exchange. These GDRs represented 49,000 thousand common shares of the Parent Company.

On April 3, 1995, GVC Corp. issued 5,000 units of GDRs on the London Stock Exchange. These GDRs represented 25,000 thousand common shares of GVC Corp., which were assumed by the Corporation as a result of a merger, with the Parent Company as the survivor entity. As of November 4, 2002, the outstanding GDRs were 7,627 thousand units, or 38,136 thousand common shares of GVC Corp. For merger purposes, these GDRs were exchanged for the Parent Company’s 1,478 thousand marketable equity securities, which represented the Parent Company’s 14,781 thousand common shares.

As of March 31, 2012, the outstanding marketable equity securities were 5,196 thousand units, representing 51,957 thousand common shares of the Parent Company. The rights and obligation of security holders are the same as those of common shareholders, except for voting rights. As of March 31, 2012, the unredeemed GDRs amounted to 988 thousand units.

Employee Stock Option Plans

In December 2007, there was a grant of 30,000 options to qualified employees of the Parent Company and its subsidiaries. Each option entitles the holder to subscribe for one thousand common shares of the Parent Company when exercisable. The options granted are valid for 6 years and exercisable at certain percentages after the second, the third, and the fourth anniversary year from the grant date. The options were granted at an exercise price equal to the closing price of the Parent Company’s common shares listed on the Taiwan Stock Exchange on the grant date. For distributing cash dividends and stock dividends and for capital reduction (besides writing off treasury stocks), the exercise price and the number of options are adjusted accordingly.

Other information on the employee stock option plans is as follows:

Balance, beginning of year Options expired Options exercised Balance, end of year Weighted-average fair value of options granted in thousand	Three Months Ended March 31	Three Months Ended March 31
	2012 Number of Options (In Thousands) Weighted -average Exercise Price (NT$) 19,819 $ 38.0 (132) 38.0 (28) 38.0 19,659 38.0 $ 16.964	2011
		Number of Options (In Thousands) Weighted -average Exercise Price (NT$) 20,655 $ 41.4 (316) 41.4 - 41.4 20,339 41.4 $ 16.964

The weighted-average remaining lives of the outstanding and exercisable options as of March 31, 2012 and 2011 was 1.75 and 2.75 years, respectively.

Compensation cost recognized under the intrinsic value method was $0 thousand for the year ended March 31, 2012 and 2011 respectively. Had the Parent Company recognized compensation cost based on the fair value method using the binomial option pricing model, the assumption and pro forma result of the Parent Company for the three months ended March 31, 2012 and 2011 would have been as follows:

Assumptions Risk-free interest rate Expected life Expected volatility Expected dividend yield Net income As reported Pro forma Basic after income tax earnings per share (New Taiwan dollars) As reported Pro forma Diluted after income tax earnings per share (New Taiwan dollars) As reported Pro forma	Three Months Ended March 31
	2012 2011 2.5101% 2.5101% 1.75 year 2.75 years 40.07% 40.07% 7.07% 7.07% $ 1,347,410 thousand $ 1,445,331 thousand $ 1,347,410 thousand $ 1,437,488 thousand $0.60 $0.65 $0.60 $0.65 $0.59 $0.64 $0.59 $0.63

Capital Surplus

Under the Company Law, capital surplus from long-term investments under the equity method may not be used for any purpose. However, capital surplus may be used to offset a deficit. In addition, the capital surplus from shares issued in excess of par (additional paid-in capital from issuance of common shares, conversion of bonds, capital surplus from merger, and treasury stock transactions) can be capitalized, which however is limited to a certain percentage of the Parent Company’s paid-in capital. However, according to the revised Company Law, effective January 4, 2012, the aforementioned capital surplus generated from donations and the excess of the issuance price over the par value of capital stock can also be used to distribute cash in proportion to original shareholders’ holding.

Appropriation of Earnings and Dividend Policy

To ensure the availability of cash for the Parent Company’s present and future expansion plans and to meet shareholders’ cash flow requirements, the Parent Company prefers to distribute more stock dividends. In principle, cash dividends are limited to 10% of total dividends distributed.

The Parent Company’s Articles of Incorporation provide that the annual net income, less any deficit, and 10% legal reserve as well as special reserve equal to the debit balances of the shareholders’ equity accounts, together with the distributable unappropriated earnings of prior years, can be retained partially on the basis of operating requirements. The remainder should be distributed as follows:

a. Bonus to employees: At least 1%.
b. Bonus to directors: 1.5% or less
c. Others, as dividends.

If the bonus to employees is in the form of shares, it may be distributed to the employees’ subsidiaries. The requirements and the method of distribution of these share bonuses are based on resolutions passed by the board of directors.

The bonus to employees and the remuneration to directors recognized for 2011 and 2010 were estimated on the basis of net income at 13.8% and 0.9%, respectively, and past appropriation experience at 15% and 1%, respectively. Material differences between these estimates and the amounts proposed by the Board of Directors in the following year are adjusted in the year of the proposal. If the actual amounts subsequently resolved by shareholders differ from the proposed amounts, the differences are recorded in the year of the shareholders’ resolution as a change in accounting estimate. If stock bonuses are resolved to be distributed to employees, the number of shares is determined by dividing the amount of bonuses by the closing price (after considering the effect of cash and stock dividends) of the shares on the day preceding the shareholders’ meeting.

These appropriations should be resolved by the shareholders in the following year and given effect in the financial statements of that year.

On June 22, 2011 and June 15, 2010, the shareholders resolved the appropriation of earnings and dividend per share in 2010 and 2009 as follows:

Legal reserve Stock dividends Cash dividends	Appropriation of Earnings 2010 2009 $ 898,646 $ 705,184 112,711 111,590 6,469,637 5,021,541	Dividend Per Share (Dollars)
		2010 2009 $ - $ - 0.05 0.05 2.87 2.25

The sharing with employees of profits of $769,869 thousand in cash and $471,855 thousand in stock as well as the remuneration to directors of $79,031 thousand for 2010 was approved in the shareholders’ meeting on June 22, 2011. The amount of the stock bonus to employees of 13,915 thousand shares was determined at the closing price of the Parent Company’s common shares (after considering the effect of dividends) of the day immediately preceding the shareholders’ meeting.

The appropriation of the earnings for 2010 was approved by the Financial Supervisory Commission, Executive Yuan, ROC. The board of directors approved August 14, 2011 as the date of distributing stock dividends and cash dividends.

The appropriation of the 2011 earnings was proposed by the Parent Company’s board of directors on April 25, 2012. The appropriations, including dividends per share, were as follows:

Legal reserve Cash dividends Stock dividends	Appropriation of Earnings $ 722,592 5,174,335 113,972	Dividends Per Share (NT$)
		$ - 2.27 0.05

The Parent Company’s board of directors also resolved to appropriate a bonus to employees of $975,500 thousand and remuneration to directors of $61,420 thousand for 2011. There was no significant difference between these resolved amounts and the amounts charged against the earnings of 2011.

The proposed 2011 appropriations from earnings, including a bonus to employees and remuneration to directors, will be presented to the shareholders for their approval in their meeting on June 19 , 2012.

Information on the profit sharing to employees and bonus to directors is available on the Market Observation Post System website of the Taiwan Stock Exchange.

Under the regulations of the Securities and Futures Bureau, the Parent Company should appropriate a special reserve equivalent to the debit balances, as of the balance sheet date, in the shareholders’ equity account, except for treasury stock and deficit. The special reserve will be distributable when the debit balances in the shareholders’ equity are reversed.

Under the regulations of the Securities and Futures Bureau and the Financial Supervisory Commission under the Executive Yuan of the ROC, the companies listed on the Taiwan Stock Exchange Corporation (TSEC) and the GreTai Securities Market (GTSM) should have a special reserve in which an amount equal to the book value in excess of the market value of treasury shares held by subsidiaries should be transferred from unappropriated earnings at the proportion owned by the Parent Company. This special reserve may be reversed to the extent of the decrease in the net debit balance. If the valuation of the stock rises up thereafter, TSEC/GTSM listed companies can reverse the special reserve as much as the reversal of valuation on the basis of the proportionate share (please refer to Note 20).

Under the Integrated Income Tax System, which took effect on January 1, 1998, ROC resident shareholders are allowed a tax credit for the income tax paid by the Parent Company on earnings generated since January 1, 1998. An imputation credit account (ICA) is maintained by the Parent Company for such income tax and the tax credit allocated to each shareholder. The maximum credit available for allocation to each shareholder cannot exceed the ICA balance on the dividend distribution date.

Under the Company Law, the appropriation for legal reserve should be made until the reserve equals the Parent Company’s paid-in capital. This reserve may be used to offset a deficit. Under the revised Company Law issued on January 4, 2012, when the legal reserve has exceeded 25% of the Parent Company’s paid-in capital, the excess may be transferred to capital or distributed in cash.

For the period ended March 31, 2012 and 2011, the Parent Company’s movements of unrealized gain or loss on financial instruments were as follows:

Recognized in Shareholders’ Equity Equity-method Investments Recognized in Shareholders’ Equity Period ended March 31, 2012 Balance, beginning of period $ (38,540) $ (334,051) Increase (decrease) in 2012 336,037 (40,134) Transferred to profit or loss (295,694) - Balance, end of period $ 1,803 $ (374,185) Period ended March 31, 2011 Balance, beginning of period $ 1,097,107 $ 332,886 Decrease in 2011 (353,746) (313,170) Balance, end of period $ 743,361 $ 19,716		Total $ (372,591) 295,903 (295,694) $ (372,382)
		$ 1,429,993 (666,916) $ 763,077

20. TREASURY STOCK (COMMON STOCK)

Unit: In Thousand Shares

Reason for Repurchase 2012 Parent Company’s shares held by direct and indirect subsidiaries reclassified from long-term stock investments to treasury stock For transfer to employees 2011 Parent Company’s shares held by direct and indirect subsidiaries reclassified from long-term stock investments to treasury stock For transfer to employees	Three Months Ended March 31	Three Months Ended March 31
	Beginning of January 1 27,840 30,565 58,405 27,701 30,565 58,266	End Increase Decrease of March 31 - - 27,840 - 30,565 - - 30,565 27,840 - - 27,701 - - 30,565 - - 58,266

At the end of March 31, 2012 and 2011, the Parent Company transferred $1,104,073 thousand from available-for-sales financial asset of direct and indirect subsidiaries to treasury stock proportionate to its ownership. Both the carrying value and market value of treasury stock mentioned above were $1,037,192 thousand in 2012 and $1,002,779 thousand in 2011.

In their meeting on August 27, 2008, the Parent Company’s Board of Directors approved a plan to repurchase up to 30,000 thousand shares listed on the Taiwan Stock Exchange (TSE) between September 28, 2008 and October 27, 2008, with the buyback price ranging from NT$20.48 to NT$43.60. On October 28, 2008, the Parent Company’s Board of Directors approved the repurchase of up to 40,000 thousand shares listed on the TSE between October 29, 2008 and December 28, 2008, with the buyback price ranging from NT$13.00 to NT$37.10. The Parent Company bought back a total of 30,565 thousand shares during the repurchase periods and retired all these shares in January 2012.

Under the Securities and Exchange Law, the maximum number of treasury stock purchased should not exceed 10% of the Parent Company’s total outstanding shares, and the aggregate purchase cost should not exceed the sum of retained earnings, additional paid-in capital in excess of par value and realized capital surplus. The treasury stock cannot be pledged or exercise shareholders’ rights. Treasury stock should be reissued within three years from the reacquisition date. Shares not transferred within the time limit will be deemed unissued, and the Parent Company should register with the authorities the change in the number of shares.

Under the Securities and Exchange Law, the Parent Company shall neither pledge treasury stock nor exercise shareholders’ rights on these shares, such as rights to dividends and to vote. The subsidiaries holding treasury stock, however, retain shareholders’ rights, except the rights to participate in any share issuance for cash and to vote.

21. EARNINGS PER SHARE

The numerators and denominators used in computing earnings per share (EPS) were as follows:

Three months ended March 31, 2012 Basic consolidated EPS Consolidated net income The effect of potential common shares with dilutive effect Bonus to employees Common stock-based compensation Diluted consolidated EPS The net income of common shareholders plus the effect of potential common shares Pro forma information on the assumption that the Parent Company’s shares held by its direct and indirect subsidiaries were not treated as treasury shares Basic consolidated EPS Consolidated net income The effect of potential common shares with dilutive effect Bonus to employees Common stock-based compensation Diluted consolidated EPS The net income of common shareholders plus the effect of potential common shares Three months ended March 31, 2011 Basic consolidated EPS Consolidated net income The effect of potential common stock with dilutive effect Bonus to employees Common stock-based compensation Diluted consolidated EPS The net income of common shareholders plus the dilutive effect of potential common shares Pro forma information on the assumption that the Parent Company’s shares held by its direct and indirect subsidiaries were not treated as treasury shares Basic consolidated EPS Consolidated net income The effect of potential common shares with dilutive effect Bonus to employees Common stock-based compensation Diluted consolidated EPS The net income of common shareholders plus the dilutive effect of potential common shares		Shares Amounts (Numerator) (Denominator) Pretax After-tax (Thousands) $ 1,287,260 $ 1,347,410 2,251,575 - - 36,268 - - - $ 1,287,260 $ 1,347,410 2,287,844 $ 1,287,260 $ 1,347,410 2,279,415 - - 36,268 - - - $1,,287,260 $ 1,347,410 2,315,683 $ 1,507,920 $ 1,445,331 2,237,799 - - 43,160 - - - $ 1,507,920 $ 1,445,331 2,280,959 $ 1,507,920 $ 1,445,331 2,265,500 - - 43,160 - - - $ 1,507,920 $ 1,445,331 2,308,660		Earnings Per Share (Dollars)
		Pretax $ 1,287,260 - - $ 1,287,260 $ 1,287,260 - - $1,,287,260 $ 1,507,920 - - $ 1,507,920 $ 1,507,920 - - $ 1,507,920		Pretax After-tax $ 0.57 $ 0.60 $ 0.56 $ 0.59 $ 0.56 $ 0.59 $ 0.56 $ 0.58 $ 0.67 $ 0.65 $ 0.66 $ 0.63 $ 0.67 $ 0.64 $ 0.65 $ 0.63

If the Parent Company presumes that the partial amount of the bonus to employees will be settled in shares, these potential shares should be included in the weighted average number of shares outstanding in calculation of diluted EPS, if the shares have a dilutive effect. The number of shares is estimated by dividing the amount of bonus to employees by the closing price (after consideration of the dilutive effect of dividends) of the common shares on the balance sheet date. The dilutive effect of the potential shares needs to be included in the calculation of diluted EPS until the shares for employee bonuses are resolved in the shareholders’ meeting in the following year.

At the three months end of 2012 and 2011, the stock-based compensation exercise price was greater than the average price of the shares, the number of common shares outstanding decreased and earnings per share increased, and these developments had an anti-dilutive effect; thus, these shares were not included in the calculation of diluted EPS.

The average number of shares outstanding for EPS calculation was adjusted retroactively for the issuance of stock dividends. This adjustment caused the basic EPS before tax decreased from NT$0.68 to NT$0.67, and diluted remain at NT$0.66 for the three months ended March 31, 2011. The basic EPS after tax remaind at NT$0.65 and diluted decreased from NT$0.64 to NT$0.63 for the three months ended March 31, 2011.

22. RELATED-PARTY TRANSACTIONS

Significant transactions with related parties are summarized below and in the accompanying Tables 1 and 2:

a. The price of the Parent Company’s and subsidiaries’ sales to Lite-On Semiconductor Corp. for the three months ended March 31, 2012 and 2011 was calculated at cost plus specific profit. Except for these purchases, the sales terms between the Parent Company and its related parties are normal.
b. The cost of the Parent Company’s and subsidiaries’ purchases from Lite-On Semiconductor Corp. for the three months ended March 31, 2012 and 2011 is based on cost plus specific profit. Except for these purchases, the purchase terms between the Parent Company and its related parties are normal.
c. Operating lease contracts with related parties were based on market prices and made under normal terms.

23. MORTGAGED OR PLEDGED ASSETS - NONCURRENT

Mortgaged or pledged assets - noncurrent Time deposits Demand deposits		March 31	March 31
		2012 $ 93,445 13,160 $ 106,605	2011 $ 97,902 12,344 $ 110,246

Mortgaged or pledged assets - noncurrent included the guarantee deposits of the Parent Company, Lite-On IT Corporation, Logah Electronics (Su Zhou) Co., Ltd. and Lippo Electronics (Su Zhou) Co., Ltd. provided to a supplier and the export customs agency for shipment clearance in advance of customs duty payments.

24. SIGNIFICANT COMMITMENTS AND CONTINGENT LIABILITIES

a. On September 8, 2010, INPRO II Licensing Sarl (INPRO) filed a lawsuit with the Superior Court of California in the County of San Francisco and charged the Parent Company with breach of contract. INPRO alleged that the Parent Company incurred a debt on patent rights obtained from Hitachi Limited. INPRO also claimed it had assumed Hitachi’s rights to payments for patent use. The Parent Company dismissed INPRO’s claims and filed a lawsuit against INPRO, alleging that the Parent Company had no patent obligations. As of April 25, 2012, the date the board of directors approved the financial statements and authorized the issue of these statements, this case was still under litigation. Thus, the Parent Company could not determine the possible results and impact of this case.
b. In October 2009, the U.S. Department of Justice (DOJ) announced that it would make antitrust investigations of CD-ROM factories. Lite-On IT Corp. (“Lite-On IT”) received an investigation notice from the DOJ. Lite-ON IT stated it would cooperate with the DOJ in the investigation. This case was still in the preliminary stage, and Lite-On IT could not estimate the outcome of the case or range of possible loss.
c. In October 2009, CMP Consulting Service, Inc. and KI, Inc.filed an antitrust group lawsuit against Lite-On IT and its subsidiaries - Philips & Lite-On Digital Solutions Corporation, Philips & Lite-On Digital Solutions USA, Inc. and other companies with related businesses - with a court in California. Also in October 2009, Aaron Deshaw also filed an antitrust lawsuit against Lite-On IT and the foregoing subsidiaries with a court in Oregon. In 2010, Aaron Wagner, The Stereo Shop, David Carney, Jr. Tina Corse, Cynthia R. Rall and Richard R. Rall also filed an antitrust group lawsuit against Lite-On IT and its subsidiaries - Philips & Lite-On Digital Solutions Corporation, Philips & Lite-On Digital Solutions USA, Inc. and other companies with related businesses. Lite-On IT assigned lawyers to deal with these lawsuits. These cases were still in the preliminary stage, and Lite-On IT could not estimate the possible outcomes.
d. In April 2010, petitioner-Carlos Fogelman filed a motion for authorization to institute class action antitrust proceedings against Lite-On IT and the foregoing subsidiaries before the Superior Court of Quebec in the district of Montreal. In June 2010, the Fanshawe College of Applied Arts and Technology filed a statement of claim in Ontario. In September 2010, Neil Godfrey filed a statement of claim with the Superior Court of British Columbia. All plaintiffs filed the antitrust group lawsuit against Lite-On IT Corporation and its subsidiaries - Philips & Lite-On Digital Solutions USA, Inc. and other companies with related businesses. Lite-On IT assigned lawyers as its representative in these lawsuits. These cases were still in the preliminary, stage, and Lite-On IT could not estimate the outcome of the case or amount of possible loss.
e. In April 2011, Orinda Intellectual Properties USA Holding Group, Inc. instituted class action proceedings against Lite-On IT Corp., Lite-On Americans, Inc. and other companies with related businesses, with the United States District Court for the Northern District of California, alleging infringement of a single patent on Blue-ray discs. Lite-On IT assigned lawyers as its representative in these lawsuits. This case was still in the preliminary stage, and Lite-On IT could not estimate the outcome of the case or amount of possible loss.

25. FINANCIAL INSTRUMENTS

a. Fair values of financial instruments were as follows:

	March 31	March 31
	2012 Fair Value Quoted Valuation Carrying Market Techniques Amount $ 9 $ - $ 12 1,310,157 - 4,086,784 - - 1,743,458 - 1,268,046 3,710,826 - 82,520 87,151 - 22,815,014 16,722,210 - 284,149 357,354 March 31		2011
Carrying Amount $ 9 1,310,157 1,057,780 1,268,046 82,520 22,815,014 284,149			Fair Value
			Quoted Valuation Market Techniques $ 12 $ - 4,086,784 - - - - 3,710,826 - 87,151 - 16,722,210 - 357,354
	2012 Fair Value Quoted Valuation Market Techniques $ - $ 139,636 - 107 - 3,190 - 6,078 - 1,580 - 88		2011
Carrying Amount $ 139,636 107 3,190 6,078 1,580 88		Carrying Amount $ 142,454 315 14,404 1,355 2,856 4,808	Fair Value
			Quoted Valuation Market Techniques $ - $ 142,454 - 315 - 14,404 - 1,355 - 2,856 - 4,808 (Continued)

	March 31	March 31
	2012 Fair Value Quoted Valuation Market Techniques $ - $ 486 - - - 1,565 - 768 - - - 167 - 416 - - - 13,483 - 2,798 - 8,242 - 21,369		2011
Carrying Amount $ 486 - 1,565 768 - 167 416 - 13,483 2,798 8,242 21,369		Carrying Amount $ - 3,354 - - 464 299 - 1,568 83 2,467 18,790 96,369	Fair Value
			Quoted Valuation Market Techniques $ - $ - - 3,354 - - - - - 464 - 299 - - - 1,568 - 83 - 2,467 - 18,790 - 96,369 (Continued)

	March 31	March 31
	2012 Fair Value Quoted Valuation Market Techniques $ - $ - - - - - - 978 - 182 - 508		2011
Carrying Amount $ - - - 978 182 508		Carrying Amount $ 2,042 250 2,541 644 - -	Fair Value
			Quoted Valuation Market Techniques $ - $ 2,042 - 250 - 2,541 - 644 - - - - (Continued)

	March 31	March 31
	2012 Fair Value Quoted Valuation Market Techniques $ - $ - - - - 238 - - - - - 20 - 2,515 - 123 $ - $ 518		2011
Carrying Amount $ - - 238 - - 20 2,515 123 $ 518		Carrying Amount $ 2 27,620 681 27,489 1,981 2,312 - 8,024 $ 2,751	Fair Value
			Quoted Valuation Market Techniques $ - $ 2 - 27,620 - 681 - 27,489 - 1,981 - 2,312 - - - 8,024 $ - $ 2,751 (Concluded)

b. Methods and assumptions used in the determination of fair values of financial instruments.
1) The carrying amounts of the following short-term financial instruments approximate their fair values because of their short maturities: cash, notes receivable, accounts receivable, accounts receivables from related parties, other receivable from related parties, other financial assets - current, short-term loans, notes and accounts payable, accrued expenses, accounts payables to related parties, other payable to related parties.
2) The carrying amounts of the refundable deposits, guarantee deposits received and restricted assets - noncurrent approximate their fair values due to the amount which will be received in the future approaches to the book value.

3) Fair values of the available-for-sale assets are based on their quoted prices in an active market. Fair values of derivatives are based on their quoted prices in an active market. For those derivatives with no quoted market prices, their fair values are determined using valuation techniques incorporating estimates and assumptions consistent with those generally used by other market participants to price financial instruments.
4) Financial assets carried at cost have no fair values because these are investments in unlisted stocks with no quoted market prices and determining their fair value entails an unreasonably high cost.
5) Fair value of long-term bank loans (included current portion of long-term bank loans) is estimated using the present value of future cash flows. The rate for long-term debts with interests of our company are all floating rate, its book value is the fair market value.
6) The fair value of obligations under capital leases is estimated using the present value of future cash flows discounted by prevailing interest rates after taking into account risk premiums.
c. Valuation gains (losses) arising from changes in fair value of derivatives contracts determined using valuation techniques were recognized as a net loss of NT$22,593 thousand and NT$107,807 thousand for the three months ended March 31, 2012 and 2011, respectively.
d. As of March 31, 2012 and 2011, financial assets exposed to fair value risk from interest rate fluctuation amounted to $32,363,292 thousand and $25,228,226 thousand, respectively, and financial liabilities amounted to $366,669 thousand and $444,505 thousand, respectively; financial assets exposed to cash flow risk from interest rate fluctuation amounted to $22,372,281 thousand and $23,057,293 thousand, respectively, and financial liabilities exposed to cash flow risk from interest rate fluctuation amounted to $30,729,648 thousand and $24,978,334 thousand, respectively.
e. The Parent Company recognized the increase of $336,037 thousand and the decrease of $353,746 thousand in shareholders’ equity for the changes in fair value of available-for-sale financial assets on March 31, 2012 and 2011, respectively.
f. Financial risks
1) Market risk. The derivative financial instruments categorized as financial assets at fair value through profit or loss are mainly used to hedge exchange rate fluctuations of non- functional foreign currency-dominated stocks and sales. The market risk is not significant due to the gain or loss on derivatives will offset by the gain or loss on the exchange rate fluctuations of hedged items. The available-for-sale financial assets held by the cooperation and its subsidiaries are listed stocks. Thus, price fluctuations in the open market would result in changes in fair values of these stocks.
2) Credit risk. Credit risk represents the potential loss that would be incurred by the Parent Company and its subsidiaries if the counter-parties or other parties breach the financial instrument contracts. Thus, contracts with positive fair values on the balance sheet date are evaluated for credit risk. In addition, since the counter-parties to derivative financial transactions are reputable financial institutions, management believes its exposure to default by counter-parties is low.
3) Liquidity risk. For long-term equity-method investments and financial assets carried at cost, the Parent Company and its subsidiaries keep liquidity reserves, which are available on a short term. Additionally, the contracted forward rate,interest rate swap, currency rate swap and option are decided on the contract starting dates. Thus, the cash flow risk on forward contracts is low.

4) Cash flow hedge. The Parent Company’s liabilities with floating interest rate might be affected by changes in the market rate. Thus, future cash flows on those liabilities might fluctuate, exposing the Parent Company to cash flow risk. To hedge against this risk, the Parent Company entered into an interest rate swap contract with a bank to change the rate on its liabilities from floating to fixed. The cash flow hedge operating are deemed sufficient. As March 31, 2012 and 2011, the unrealized losses recognized in shareholders’ equity were amounted to $139,636 thousand and $142,454 thousand, respectively. Other information on the cash flow hedge transactions is summarized below.

		Nominal	Float	Fixed	Settlement
Financial Instruments	Date	Principal	Rate	Rate	Date	Due Date
Lite-On Technology Corp.
Interest rate swap	March 31, 2012	$ 6,000,000	Note	1.895%	Quarterly	2015.9.23
Interest rate swap	March 31, 2011	$ 6,000,000	Note	2.2125%-	Quarterly	2015.9.23
				2.375

Note: Based on the average rate for 90-day notes in Taiwan’s secondary market.

Hedged Items Medium and long-term loans	Designated Hedging Instruments Expected Expected Period of Fair Value Period of Realizing Financial Instruments March 31 Cash Gains or Designated 2012 2011 Flows Losses Interest rate swap $ (139,636) $ (142,454) 2008-2015 2008-2015
	Financial Instruments Designated Interest rate swap

26. SEGMENT INFORMATION

Segment information is provided to the Group’s chief operating decision maker for allocating resources to the segments and assessing their performance. The information focuses on every type of products sold or services provided. The Corporation’s segment information disclosed in accordance with Statement of Financial Accounting Standards No. 41 - “Operating Segments” is as follows:

a. Optoelectronics and Network: Designed and mass manufacturer of phone camera modules;
b. System Integration: Provided well-recognized integrated system solutions for the consumer electronics markets;
c. Optical Storage: Manufacturing and selling CD-ROM, CD-RW, and DVD-ROM as well as more advanced products.

The Corporation also had other operating segments that did not exceed the quantitative threshold. These segments mainly engage in the LED Transit Modules, Automotive Electronics, and renewable energy and efficiency related technologies and products.

The Group uses net profit as the measurement for segment profit and the basis of performance assessment. There was no material inconsistency between the accounting policies of the operating segment and the accounting policies described in Note 2.

The Group’s operating segment information is as follows:

Sales from external customers Sales among inter segments Operating profit (loss) Segment assets Sales from external customers Sales among inter segments Operating profit (loss) Segment assets	Three Months Ended March 31, 2012
	Optoelectronics and Network System Integration Optical Storage Others Elimination Total $ 18,269,173 $ 20,219,850 $ 12,053,000 $ 2,068,760 $ - $ 52,610,783 192,255 - 2,735 51,677 (246,667) - 408,316 1,446,253 476,834 (594,937) - 1,736,466 53,883,997 44,173,202 41,265,998 57,970,002 (3,106,965) 194,186,234 Three Months Ended March 31, 2011
	Optoelectronics and Network System Integration Optical Storage Others Elimination Total $ 14,229,923 $ 21,982,136 $ 13,954,195 $ 3,106,832 $ - $ 53,273,086 184,593 15,754 6,248 53,463 (260,058) - 738,631 1,002,432 677,907 (381,215) - 2,037,755 50,493,361 46,340,077 41,697,042 54,274,887 (4,174,040) 188,631,327

27. EXCHANGE RATE INFORMATION OF FOREIGN-CURRENCY FINANCIAL ASSETS AND LIABILITIES

The significant financial assets and liabilities denominated in foreign currencies were as follows:

(In Thousands of New Taiwan Dollars, Except Exchange Rate)

Financial assets Monetary items CNY JPY USD THB HKD EUR Nonmonetary items CNY JPY USD HKD EUR Investments accounted for by the equity CNY JPY USD EUR	March 31	March 31
	2012 Foreign Currencies Exchange Rate $ 4,955,944 4.6831 2,571,017 0.3589 2,291,814 29.4990 401,537 0.9621 188,390 3.7999 109,705 39.3399 68,801 4.6831 5,661 0.3589 221,784 29.4990 54,050 3.7999 12,844 39.3399 29,970 4.6831 153,170 0.3589 25,772 29.4990 437 39.3399	2011
		Foreign Currencies Exchange Rate $ 5,341,148 4.4889 4,164,513 0.3550 1,782,098 29.3950 416,425 0.9740 234,131 3.7762 88,209 41.6821 48,764 4.4889 82,758 0.3550 29,420 29.3950 54,165 3.7762 3,364 41.6821 - 4.4889 141,693 0.3550 18,072 29.3950 287 41.6821 (Continued)

Financial liabilities Monetary items CNY JPY USD THB HKD EUR Nonmonetary items JPY USD	March 31	March 31
	2012 Foreign Currencies Exchange Rate $ 3,687,841 4.6831 1,425,129 0.3589 6,282,794 29.4990 285,741 0.9621 29,575 3.7999 162,434 39.3399 662 0.3589 10,820 29.4990	2011
		Foreign Currencies Exchange Rate $ 3,578,153 4.4889 4,547,438 0.3550 1,744,235 29.3950 301,166 0.9740 173,740 3.7762 257,089 41.6821 79,348 0.3550 8,185 29.3950 (Concluded)

28. PLAN FOR THE ADOPTION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS

According to the Rule No. 0990004943 issued by the Financial Supervisory Commission (FSC) on February 2, 2010, the Group is required to disclose a plan for the adoption of the International Financial Reporting Standards (IFRSs) in the consolidated financial statements, as follows:

a. On May 14, 2009, the FSC announced the road map of IFRSs adoption for ROC companies. Starting from 2013, companies with shares listed on the Taiwan Stock Exchange (TSE) or traded on the Taiwan GreTai Securities Market or Emerging Stock Market should prepare for the consolidated financial statements in accordance with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers, the IFRSs, International Accounting Standards (IASs), interpretations and related guidance translated by the Accounting Research and Development Foundation (ARDF) and issued by the FSC. Following this road map, the Parent Company and its subsidiaries established a task force to monitor and execute the IFRSs adoption plan. The important plan items, responsible divisions and plan progress are listed as follows:
Contents of Plan Responsible Department Status of Execution
1) Establish the IFRSs task force Finance, system integration, Completed human resource, operation, sales and internal audit
2) Set up a work plan for IFRSs adoption Finance Completed 3) Complete the identification of GAAP Finance Completed differences and impact of IFRS adoption
4) Complete the identification of Finance Completed
4) Complete the identification of consolidated entities under the IFRSs
5) Complete the assessment of the applicability of the IFRS 1 - “First-time Adoption of International Financial Reporting Standards” (IFRS 1)

Finance Completed

(Continued)

Contents of Plan 6) Complete the evaluation, configuration and testing of the IT systems 7) Complete the modification of the relevant internal controls 8) Determine the IFRSs accounting policies to be applied 9) Determine how to apply IFRS 1. 10) Complete the preparation of the opening date balance sheet under IFRSs 11) Prepare quarterly comparative financial information under IFRSs for 2012 12) Complete the modification of the relevant internal controls (including the financial reporting procedure and related information technology)	Responsible Department Finance, system integration, human resource, operation, sales and internal audit Finance, system integration, human resource, operation, sales and internal audit Finance Finance Finance Finance Finance, system integration, human resource, operation, sales and internal audit	Status of Execution
		Completed Completed Completed Completed Completed For quarterly In progress

(Concluded)

b. As of March 31, 2012, based on the Group’s assessment, the significant differences between the Group’s current accounting policies under R.O.C. GAAP and the ones under IFRSs are stated as follows:
1) Reconciliation of consolidated balance sheet as of January 1, 2012:

			Effect of
	ROC GAAP	Transition to
Item	Amount		IFRSs	IFRSs Amount	Note
Cash and cash equivalents	$ 56,515,383	$	(3,633,137)	$ 52,882,246	a)
Accounts receivable, net	45,469,494		372,114	45,841,608	b)
Accounts receivable - related	1,099		62,555	63,654	b)
parties, net
Other financial assets - current	1,575,370		3,633,137	5,208,507	a)
Prepayments and other current	4,024,067		647,799	4,671,866	h), i), j) and n)
assets
Deferred income tax assets -	951,668		(951,668)	-	c)
current
Available-for-sale financial assets	2,783,354		1,487,972	4,271,326	f)
- noncurrent
Financial assets carried at cost -	1,487,972		(1,487,972)	-	f)
noncurrent
Investments accounted for by the	3,590,108		(159,579)	3,430,529	l) and p)
equity method
Property, plant and equipment	39,985,995		(1,099,418)	38,886,577	e), h), j) and m)
Intangible assets	16,408,099		(98,305)	16,309,794	h), i) and m)
Other assets
Assets leased to others, net	113,843		(113,843)	-	e)
Idle assets, net	135,538		(135,538)	-	e)
					(Continued)

Item Deferred expense, net Deferred income tax assets Long-term prepayments Other Total Accrued expenses Other current liabilities Obligations under capital leases - noncurrent Reserve for land value increment tax Accrued pension liabilities Deferred income tax liabilities Deferred credits Other Total liabilities Capital surplus Unappropriated earnings Net loss not recognized as pension cost Unrealized loss on financial instruments Treasury stock Other Noncontrolling interests Total shareholders’ equity Total	ROC GAAP Amount $ 2,273,596 - - 28,745,400 $ 204,060,986 $ 11,139,255 6,549,962 316,466 239,693 143,168 747,622 84,143 95,762,315 114,982,624 27,759,251 11,729,938 (17,182) (372,591) (1,857,643) 31,685,449 20,151,140 89,078,362 $ 204,060,986	Effect of Transition to IFRSs IFRSs Amount Note $ (2,273,596) $ - h) 725,254 725,254 c), d), n), o) and p) 3,172,954 3,172,954 h), i), j), m) and n) - 28,745,400 $ 148,729 $ 204,209,715 $ 242,660 $ 11,381,915 o) 434,669 6,984,631 b) 4,441 320,907 m) (239,693) - g) 81,378 224,546 n) (713) 746,909 d), g) and n) (84,143) - l) - 95,762,315 438,599 115,421,223 (907,070) 26,852,181 p) and q) 662,992 12,392,930 m), n), o), p), q) and r) 17,182 - r) 230,587 (142,004) k) (230,587) (2,088,230) k) - 31,685,449 (62,974) 20,088,166 n) and o) (289,870) 88,788,492 $ 148,729 $ 204,209,715 (Concluded)

2) Reconciliation of consolidated balance sheet as of March 31, 2012

			Effect of
	ROC GAAP	Transition to
Item	Amount		IFRSs	IFRSs Amount	Note
Cash and cash equivalents	$ 56,039,996	$	(9,295,202)	$ 46,744,794	a)
Accounts receivable, net	41,691,385		447,217	42,138,602	b)
Accounts receivable - related	79,619		9,934	89,553	b)
parties, net
Other financial assets - current	1,754,568		9,295,202	11,049,770	a)
Prepayments and other current	3,613,717		664,718	4,278,435	h), i) and j)
assets
Deferred income tax assets -	1,032,917		(1,032,917)	-	c)
current
Available-for-sale financial assets	1,310,157		1,057,780	2,367,937	f)
- noncurrent
Financial assets carried at cost -	1,057,780		(1,057,780)	-	f)
noncurrent
Investments accounted for by the	3,598,181		(155,473)	3,442,708	l) and p)
equity method
Property, plant and equipment	37,950,823		(612,480)	37,338,343	e), h), j) and m)
Intangible assets	16,313,871		(138,944)	16,174,927	h), i), m) and p)
Leased assets, net	113,232		(113,232)	-	e)
Idle assets, net	135,305		(135,305)	-	e)
					(Continued)

Item Deferred expense, net Deferred income tax assets Long-term prepayments Other Total Accrued expenses Other current liabilities Obligations under capital leases - noncurrent Reserve for land value increment tax Accrued pension liabilities Deferred income tax liabilities Deferred credits Other Total liabilities Capital surplus Unappropriated earnings Foreign currency translation reserve Net loss not recognized as pension cost Unrealized loss on financial instruments Treasury stock Other Noncontrolling interests Total shareholders’ equity Total		ROC GAAP Amount $ 2,177,178 - - 27,317,505 $ 194,186,234 $ 10,531,460 5,641,290 284,149 239,693 156,652 971,034 84,157 86,554,841 104,463,276 27,327,547 13,077,348 495,889 (13,964) (372,382) (1,104,073) 29,780,103 20,532,490 89,722,958 $ 194,186,234	Effect of Transition to IFRSs IFRSs Amount Note $ (2,177,178) $ - h) 821,869 821,869 c), d), o) and p) 2,603,282 2,603,282 h), i), j), m) and n) - 27,317,505 $ 181,491 $ 194,367,725 $ 282,328 $ 10,813,788 o) and p) 457,151 6,098,441 b) 3,034 287,183 m) (239,693) - g) 24,639 181,291 n) 15,221 986,255 d), g) and n) (84,157) - l) - 86,554,841 458,523 104,921,799 (762,729) 26,564,818 p), q) and s) 532,261 13,612,609 m), n), o), p), q), r) and s) 1,579 497,468 o) and p) 13,964 - r) 230,587 (141,795) k) (230,587) (1,334,660) k) - 29,780,103 (65,107) 20,467,383 n), o) and p) (277,032) 89,445,926 $ 181,491 $ 194,367,725 (Concluded)

3) Reconciliation of consolidated statement of comprehensive income for the three months ended March 31, 2012

Item Net sales Cost of sales Gross profit before affiliates’ elimination Unrealized intercompany gains Gross profit Operating expenses Operating income Nonoperating gains and loss Gain on disposal of investments, net Investment loss recognized under the equity method, net Other Total nonoperating expenses and losses	ROC GAAP Amount $ 52,610,783 (45,176,517) 7,434,266 (14) 7,434,252 (5,351,968) 2,082,284 255,409 (23,243) (10,903) 221,263	Effect of Transition to IFRSs IFRSs Amount Note $ (718) $ 52,610,065 l) 20,154 (45,156,363) l), n) and o) 19,436 7,453,702 11 (3) p) 19,447 7,453,699 (9,245) (5,361,213) m), n) and o) 10,202 2,092,486 (144,340) 111,069 q) and s) 3,544 (19,699) p) - (10,903) (140,796) 80,467 (Continued)

Item Income before income tax Income tax Consolidated net income Exchange differences on translating foreign operations Unrealized gain on financial instruments Cash flow hedges Total comprehensive income for the period	ROC GAAP Amount $ 2,303,547 (567,081) $ 1,736,466	Effect of Transition to IFRSs IFRSs Amount Note $ (130,594) $ 2,172,953 (524) (567,605) n) and o) $ (131,118) 1,605,348 (1,128,121) 209 25,589 $ 503,025 (Concluded)

4) Exemptions from IFRS 1

IFRS 1 - “First-time Adoption of International Financial Reporting Standards” establishes the procedures for the Group’s first consolidated financial statements to be prepared in accordance with IFRSs. Under IFRS 1, the Group is required to determine the accounting policies under IFRSs and retrospectively apply those accounting policies in its opening balance sheet at the date of transition to IFRSs (January 1, 2012; the transition date), except for optional exemptions and mandatory exceptions to the retrospective application provided under IFRS 1. The main optional exemptions the Group adopted are summarized as follows:

Business combinations

The Group elected not to apply IFRS 3 - “Business Combinations” retrospectively to past business combinations that occurred before the date of transition to IFRSs. Therefore, the carrying amount of goodwill arising from past business combinations in the opening IFRS consolidated balance sheet is its carrying amount in accordance with ROC GAAP as of December 31, 2011.

This exemption applies to the Group’s past investments in its associates.

Share-based payment transactions

The Group elected to use the exemption from the retrospective application of IFRS 2 - “Share-based Payment” on all equity instruments that were granted and vested before the date of transition to IFRSs.

Cost recognition

At the date of transition to IFRSs, the Group should measure property, plant and equipment and intangible properties at cost in accordance with IFRSs. The relevant regulations should be retrospectively adopted.

Employee benefits

The Group elected to recognize all cumulative actuarial gains and losses relating to employee benefits in accumulated earnings at the date of transition to IFRSs.

The effects of applying the foregoing optional exemptions on the Group are stated under “5. Notes to the reconciliation of the significant differences.”

5) Notes to the reconciliation of the significant differences

As of March 31, 2012, based on the Group’s assessment, the significant differences between the Group’s current accounting policies under ROC GAAP and the ones under IFRSs are stated as follows:

a) Bank deposits with original maturity more than three months

Under ROC GAAP, the term “cash and cash equivalents” used in the financial statements includes cash on hand, demand deposits, check deposits, time deposits that are cancelable but without any loss of principal and negotiable certificates of deposit that are readily salable without any loss of principal. However, under IFRSs, cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. An investment normally qualifies as a cash equivalent only when it has a short maturity of three months or less from the date of acquisition. Some certificates of deposit the Group held that had maturities of more than three months from the date of investment are reclassified as other financial assets.

As of March 31, 2012 and January 1, 2012, the amounts reclassified to other financial assets - current were NT$9,295,202 thousand and NT$3,633,137 thousand, respectively.

b) Allowance for sales returns and discounts

Under ROC GAAP, provisions for estimated sales returns and discounts are recognized as a reduction of revenue in the period the related revenue is recognized on the basis of historical experience. Allowance for sales returns and discounts is recorded as a deduction from accounts receivable. Under IFRSs, the allowance for sales returns and discounts is a present obligation arising from past events and with uncertain timing of settlement and is thus reclassified to provisions (classified under other current liabilities).

As of March 31, 2012 and January 1, 2012, the amounts reclassified from allowance for sales returns and discounts to provisions were NT$457,151 thousand and NT$434,669 thousand, respectively.

c) Classifications of deferred income tax asset/liability and valuation allowance

Under ROC GAAP, valuation allowances are provided to the extent, if any, that it is more likely than not that deferred income tax assets will not be realized. Under IFRSs, deferred tax assets are only recognized to the extent that it is probable that there will be sufficient taxable profits; thus, a valuation allowance account is not needed.

In addition, under ROC GAAP, a deferred tax asset and liability is classified as current or noncurrent in accordance with the related asset or liability for financial reporting. However, if a deferred income tax asset or liability does not relate to an asset or liability in the financial statements, it is classified as current or noncurrent on the basis of the expected length of time before it is realized or settled. Under IFRSs, a deferred tax asset and liability is classified as noncurrent asset or liability.

As of March 31, 2012 and January 1, 2012, the amounts reclassified from deferred income tax assets - current to deferred income tax assets - noncurrent were NT$1,032,917 thousand and NT$951,668 thousand, respectively.

d) Offsetting between deferred tax assets/liabilities

Under ROC GAAP, deferred current tax assets - current should be offset against deferred tax liability - current under the same taxable entity. The same rule applies to deferred tax asset/liability - noncurrent. Under IFRSs, an entity is eligible to offset tax assets against tax liabilities generated from the same taxable entity only (a) if the entity has a legally enforceable right to make this offset and (b) the deferred tax assets and liabilities relate to income taxes levied by the same tax authorities on either the same taxable entity or different taxable entities that intend either to settle current tax liabilities and assets on a net basis or to realizethe assets and settle the liabilities simultaneously.

As of March 31, 2012 and January 1, 2012, the offset amounts of the Group’s deferred tax assets and deferred tax liabilities were NT$224,584 thousand and NT$240,519 thousand, respectively.

e) The classification of leased assets and idle assets

Under ROC GAAP, leased assets and idle assets are classified under other assets and idle assets. Under IFRSs, the aforementioned items are classified as property, plant and equipment in accordance with their nature. Leased assets are mainly dormitories leased to employees and factories leased to suppliers. Based on IAS 40 - “Investment Property,” the dormitories leased to employees and factories leased to suppliers are not considered investment properties since they cannot be sold separately and comprise only an insignificant portion of the plant.

As of March 31, 2012 and January 1, 2012, the amounts reclassified from leased assets and idle assets to property, plant and equipment were NT$248,537 thousand and NT$249,381 thousand, respectively.

f) Financial assets carried at cost

Under Regulations Governing the Preparation of Financial Reports by Securities Issuers, the non-publicly traded stocks or stocks that are not traded in the Emerging Stock Market and pertaining to an investment in which the investor has no significant influence on the investee should be measured as financial assets carried at cost.

Under IFRSs, the financial instruments designated as at fair value through other comprehensive income and financial assets carried at cost should be classified as at fair value through profit or loss.

As of March 31, 2012 and January 1, 2012, the Group’s financial assets carried at cost reclassified to available for sale financial assets amounted to NT$1,057,780 thousand and NT$1,487,972 thousand, respectively.

g) Reserve for land value increment tax

Based on the Guidelines Governing the Preparation of Financial Reports by Securities Issuers, land revaluations surplus is classified as reserve for land value increment tax and recorded under other liabilities. Under IFRSs, the Group reclassified land value increment tax to deferred income tax liabilities. As of March 31, 2012 and January 1, 2012, the amount reclassified from land value increment tax to deferred income tax liabilities was NT$239,693 thousand.

h) The classification of deferred expenses

Under ROC GAAP, deferred expenses are recorded under other assets. Under IFRSs, the Group reclassified deferred expenses to prepaid expenses, fixed assets, intangible assets, and long-term prepaid expenses in accordance with their nature.

As of March 31, 2012, the Group had reclassified deferred expenses to prepaid expenses, property, plant and equipment, intangible assets, and long-term prepaid expenses amounting to NT$11,618 thousand, NT$1,261,864 thousand, NT$517,092 thousand, and NT$386,604 thousand, respectively.

As of January 1, 2012, the Group’s deferred expenses reclassified to prepaid expenses, property, plant and equipment, intangible assets, and long-term prepaid expenses amounted to NT$12,858 thousand, NT$1,296,031 thousand, NT$598,025 thousand, and NT$366,682 thousand, respectively.

i) Land use rights

Under ROC GAAP, land use rights are classified as intangible asset. Under IFRSs, based on their nature, a land use right is classified as prepayment in accordance with IAS No. 17 - “Leases.”

As of March 31, 2012, the Group’s land use rights reclassified to prepayments and long-term prepayments amounted to NT$539,577 thousand, NT$110,096 thousand, respectively.

As of January 1, 2012, the Group’s land use rights reclassified to prepayments and long-term prepayments amounted to NT$585,852 thousand and NT$110,569 thousand, respectively.

j) Classification of the prepayments for equipment

Under ROC GAAP, the prepayments for equipment are usually recorded under fixed assets. Under IFRSs, prepayments for equipment are usually recorded under prepayments or long-term prepayments.

As of March 31, 2012, on the basis of the nature of the prepayments for equipment, the Group reclassified prepayments for equipment to prepayments and long-term prepayments amounting to NT$113,523 thousand and NT$2,041,127 thousand, respectively.

As of January 1, 2012, on the basis of the nature of the prepayments for equipment, the Group reclassified prepayments for equipment to prepayments and long-term prepayments amounting to NT$48,426 thousand and NT$2,631,249 thousand, respectively.

k) Treasury stock

Under ROC GAAP on the accounting for treasury stocks, effective January 1, 2002, the Group accounted for its shares held by its subsidiary as treasury stock when it recognized the investment income at the market price. The difference in carrying value and market value of this treasury stock was recorded as unrealized loss on available-for-sale financial assets. Under IFRSs, treasury shares are recognized immediately at the time when treasury shares are acquired by subsidiaries.

As of March 31, 2012 and January 1, 2012, the Group’s unrealized loss on available-for-sale financial assets reclassified to treasury was NT$230,587 thousand.

l) Investments in associates- unrealized profits from downstream transactions

Under ROC GAAP, unrealized profits from downstream transactions are adjusted in proportion to unrealized gross profit and deferred credits. Under IFRSs, unrealized profits from downstream transactions are recorded under Investments in Associates.

As of March 31, 2012 and January 1, 2012, the Group’s deferred credits reclassified to investments accounted for by the equity method amounted to NT$84,157 thousand and NT$84,143 thousand, respectively.

For the three months ended March 31, 2012, the Group’s unrealized gross profit or loss on downstream transactions are adjusted for a decrease in the operating revenue and operating cost of NT$718 thousand each.

m) Capitalization of lease payments

Under ROC GAAP, lease payments are recorded as rental expense in the period the lessee actually uses the item leased. Under IFRSs, they should be capitalized as part of asset acquisition cost.

As of March 31, 2012, the adjustment of IFRSs resulted in increases in property, plant and equipment by NT$31,769 thousand and unappropriated earnings by NT$33,084 thousand, respectively.

As of January 1, 2012, the adjustment of IFRSs resulted in increases in property, plant and equipment by NT$34,845 thousand and unappropriated earnings by NT$33,084 thousand.

For the three months ended March 31, 2012, the depreciation expense was adjusted for an increase of NT$532 thousand.

n) Employee benefits

The Group had previously applied actuarial valuation to its defined benefit obligations and recognized the related pension cost and retirement benefit obligation in conformity with ROC GAAP. Under IFRSs, the group should carry out actuarial valuation on defined benefit obligations in accordance with IAS No. 19 - “Employee Benefits.” The Group has opted to recognize actuarial gains and losses as other comprehensive income immediately in full in the period in which they occur. The subsequent reclassification to earnings is not permitted.

At the transition date, the Group performed the actuarial valuation under IAS No. 19 - “Employee Benefits” and recognized the valuation difference directly as retained earnings under IFRS 1. As of March 31, 2012, the adjustment of IFRSs resulted in increases in long-term prepayments by NT$24,415 thousand and accrued pension liabilities by NT$24,639 thousand and a decrease in unappropriated earnings by NT$5,895 thousand.

As of January 1, 2012, the adjustment of IFRSs resulted in increases in deferred income tax assets by NT$7,624 thousand, long-term prepayments by NT$46,252 thousand, and accrued pension liabilities by NT$81,378 thousand and a decrease in unappropriated earnings by NT$3,104 thousand.

For the three months ended March 31, 2012, the salary expenses (NT$467 thousand recorded as cost of sales and NT$353 thousand recorded as operating expenses) were adjusted for a decrease of NT$820 thousand and the income tax was adjusted for an increase of NT$91 thousand.

o) Employee benefits - short-term accumulated compensated absences

Under ROC GAAP, there are no specific requirements for recognizing accumulated compensated absences at the end of reporting periods. Companies usually recognize the related costs when the employees actually go on leave. Under IFRSs, the expected cost of short-term accumulated compensated absences should be recognized as the employees render services that increase their entitlement to these compensated absences.

As of March 31, 2012, the IFRS’s evaluation adjustment resulted in an increase of accrued expenses by NT$218,114 thousand. In addition, the adjustment resulted in decreases in unappropriated earnings by NT$179,786 thousand and noncontrolling interests by NT$31,184 thousand.

The evaluation adjustments as of January 1, 2012, resulted in increases of deferred income tax assets by NT$6,471 thousand and accrued expenses by NT$259,609 thousand. In addition, unappropriated earnings and noncontrolling interests were adjusted for a decrease of NT$179,786 thousand and NT$70,352 thousand, respectively.

For the three months ended March 31, 2012, the salary expenses were adjusted for a decrease of NT$9,903 thousand resulting in a decrease of NT$18,969 thousand in cost of sales and an increase of NT$9,066 thousand in operating expenses. The income tax was also adjusted for an increase of NT$433 thousand.

p) Investments accounted for using the equity method

The Group has evaluated significant differences between current accounting policies and IFRSs for the Group’s associates and joint ventures accounted for by the equity method. The significant difference is mainly due to the adjustment to employee benefits and leases.

As of March 31, 2012, the IFRS’s evaluation adjustment resulted in increases NT$13,777 thousand in deferred income tax assets; NT$64,214 thousand in accrued expenses; and NT$91,583 thousand in unappropriated earnings. In addition, the adjustment resulted in decreases of NT$71,316 thousand in investments accounted for by the equity method; NT$170,935 thousand in capital surplus; and NT$37,015 thousand in noncontrolling interests.

As of January 1, 2012, the differences mentioned above resulted in an increase in unappropriated earnings by NT$91,583 thousand. In addition, the adjustment resulted in decreases in investments accounted for by the equity method by NT$75,436 and in capital surplus by NT$168,671 thousand.

For the three months ended March 31, 2012, investment loss was adjusted for a decrease of NT$3,544 thousand and unrealized intercompany gains, of NT$11 thousand.

q. Accounting treatment of the Parent Company for increase in carrying values of equity-method investments due to not subscribing proportionally to the additional shares issued by the investees and relevant adjustment of capital surplus - long-term equity investment

Under ROC GAAP, if an investee issues new shares and an investor does not buy new shares proportionately, the investor’s ownership percentage and its interest in net assets of the investment will change. The resulting difference should be used to adjust the capital surplus and long-term equity investment accounts.

By contrast, under IFRSs, any equity changes in the invested associates without the loss of significant influence on the associates will be recognized as a deemed acquisition or a deemed disposal of the shares in the invested associates. Any equity changes in the invested subsidiaries without losing significant control over the subsidiaries will be deemed equity transactions. In addition, in accordance with the “Q&A regarding adoption of IFRSs” issued by the Taiwan Stock Exchange, capital surplus that is not complying with IFRSs or is irrelevant to the Company Law and to the legal interpretations of the Ministry of Economic Affairs, ROC should be adjusted accordingly at the date of transition to IFRSs.

As of March 31, 2012 and January 1, 2012, the foregoing adjustments resulted in a decrease of NT$738,398 thousand in the Parent Company’s capital surplus - long term investments and an increase of NT$738,398 thousand in unappropriated earnings.

In addition, gain on disposal of investments was adjusted for an increase of NT$1,853 thousand for the three months ended March 31, 2012.

r) Employee benefits-Minimum pension liability to be recognized

Under ROC GAAP, the minimum pension liability should be should be recognized as such in the balance sheet; if the accrued pension liability is lower than this minimum, any shortfall should be recorded.

Under the IFRSs, there are no regulations for minimum pension liability.

As of March 31, 2012, net loss not recognized as pension cost was adjusted for an increase of NT$10,601 thousand and unappropriated earnings for a decrease of NT$10,601 thousand.

As of January 1, 2012, net loss not recognized as pension cost was adjusted for an increase of NT$17,182 thousand and unappropriated earnings for a decrease of NT$17,182 thousand.

s) Disposal of partial shares without losing significant influence on the investee

Under ROC GAAP, if the stock ownership percentage changes during the year, the investor company should recognize investment gains or losses in proportion to the actual stock ownership percentage on the disposition date.

Under IFRSs, disposal of the shares of subsidiaries without losing significant control over the subsidiaries is deemed an equity transaction.

As of March 31, 2012, the foregoing adjustments resulted in an increase of NT$146,193 thousand in the Parent Company’s capital surplus - long term investments under the equity method amounting to NT$146,193 thousand; gain on disposal of investments was adjusted for a decrease of NT$146,193 thousand.

c. The Group’s foregoing assessment is based on the 2010 version of IFRSs translated by the ARDF and the Guidelines Governing the Preparation of Financial Reports by Securities Issuers issued by FSC on December 22, 2011. However, the assessment result may change as FSC may issue new rules governing the adoption of IFRSs and as other laws and regulations may be amended to comply with the adoption of IFRSs. Actual results may differ from these assessments.

TABLE 1

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

RELATED-PARTY TRANSACTIONS MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars)

Nature of Relationship Related Party (Note 1) March 31, 2012 Lite-On Semiconductor Corp. a Silpert Travel Service Co., Ltd. d Chi Mei Mold Co., Ltd. c Other related parties (Note 3) March 31, 2011 Lite-On Semiconductor Corp. a Silpert Travel Service Co., Ltd. d Jhen Vei Electronic Co., Ltd. b Jhen Vei Electronic (Shenzhen) Co., Ltd. b Chi Mei Mold Co., Ltd. c Other related parties (Note 4)		Receivable from Related Parties	Receivable from Related Parties	Receivable from Related Parties	Total $ 83,138 - - 747 $ 83,885 $ 118,897 - - - - 749 $ 119,646		Payable to Related Parties	Payable to Related Parties	Payable to Related Parties
		Accounts Receivable % Amount (Note 2) $ 78,872 94 - - - - 747 1 $ 79,619 95 $ 116,035 97 - - - - - - - - 749 1 $ 116,784 98		Other Receivable % Amount (Note 2) 4,266 5 - - - - - - $ 4,266 5 $ 2,862 2 - - - - - - - - - - $ 2,862 2			Accounts Payable % Amount (Note 2) $ 201,626 73 - - 33,900 12 12,251 5 $ 247,777 90 $ 168,631 78 - - 9,074 4 8,819 4 - - 6,408 3 $ 192,932 89		Other Payable % Amount (Note 2) - - 4,666 2 24,311 8 - - $ 28,977 10 $ 30 - 3,901 2 - - - - 19,004 9 91 - $ 23,026 11	Total $ 201,626 4,666 58,211 12,251 $ 276,754 $ 168,661 3,901 9,074 8,819 19,004 6,469 $ 215,958

Note 1: a. Equity-method investee.

b. An investee of an equity-method subsidiary.
c. An investee of an equity-method subsidiary is its chairman.
d. Its chairman is a relative of the Parent Company’s chairman.

Note 2: Percentage of specific account balance.

Note 3: Other Related Parties including:

a. An investee of an equity-method subsidiary: Jhen Vei Electronic (Shenzhen) Co., Ltd. and Jhen Vei Electronic (Wujian) Co., Ltd. b. The Parent Company’s chairman is its director: Co Tech Copper Foil Corp.

Note 4: Other Related Parties including:

a. Equity-method investee: Dragonjet Corporation.
b. An investee of an equity-method subsidiary: Jhen Vei Electronic (Wujian) Co.
c. The Parent Company’s chairman is its director: Co Tech Copper Foil Corp.
d. The Parent Company is its main benefactor.

Note 5: Significant transactions between the entities of consolidation have already eliminated.

TABLE 2

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

RELATED-PARTY TRANSACTIONS THREE MONTHS ENDED MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars)

Nature of Relationship Related Party (Note 1) March 31, 2012 Lite-On Semiconductor Corp. a Lite-On Cultural Foundation d Silpert Travel Service Co., Ltd. c Chi Mei Machinery Corp. b Other related parties (Note 5) March 31, 2011 Lite-On Semiconductor Corp. a Lite-On Cultural Foundation d Silpert Travel Service Co., Ltd. c Chi Mei Machinery Corp. b Actron Technology Corp. e Canfield Ltd. b Jhen Vei Electronic (Shenzhen) Co., Ltd b Other related parties (Note 6)		Sales % Amount (Note 2) $ 49,835 - 21 - - - - - 756 - $ 50,612 - $ 81,050 - 23 - - - - - - - - - - - 756 - $ 81,829 -		Purchases % Amount (Note 2) $ 112,898 - - - - - 11,203 - 4,569 - $ 128,670 - $ 156,936 - - - - - 17,748 - - - - - 10,428 - 10,912 - $ 196,024 -	Rental Revenue (Note 6) $ - 86 14 - - $ 100 $ - 86 14 - - - - - $ 100	Other Revenue (Note 5) $ 749 9 197 229 - $ 1,184 $ 625 11 157 228 135 - - - $ 1,156	Rental Expense $ - - - - - $ - $ - - - - - - - - $ -	Other Expense (Note 4) $ - - 21,291 2,371 - $ 23,662 $ - 526 20,076 8,587 - 199,375 - - $ 228,564			Property Transaction	Property Transaction
										Book Value $ - - - - - $ - $ - - - - - - $ -	Proceeds $ - - - - - $ - $ - - - - - - - - $ -	Disposal Gain (Loss) $ - - - - - $ - $ - - - - - - - - $ -	Cost $ - - - - - $ - $ - - - - - - - - $ -

Note 1: a. Equity-method investee.

b. An investee of an equity-method subsidiary is its chairman.

c. Its chairman is a relative of the Parent Company’s chairman.
d. The Parent Company is its main benefactor.

e. The Parent Company’s chairman is its director.

Note 2: Except for transactions disclosed in Note 22, the sales prices and payment terms to related parties were not significantly different from those of sales to third parties.

Note 3: Percentage of specific account balance.

Note 4: Mainly included travel fees and repair expenses.

Note 5: Other related parties including:

a. An investee of an equity-method subsidiary: Jhen Vei Electronic (Shenzhen) Co., Ltd.

b. The Parent Company’s chairman is its director: Co Tech Copper Foil Corp.

Note 6: Recognized as operating revenue.

Note 7: Significant transactions between the entities of consolidation have already eliminated.

TABLE 3

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

INTERCOMPANY RELATIONSHIPS AND PERCENTAGES OF OWNERSHIP THREE MONTHS ENDED MARCH 31, 2012 AND 2011

March 31, 2012

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

100% 74.06% 100%
Lite-On Technology Corporation Lite-On Capital Inc. Leotek Electronics Corp. Leotek Electronics USA Corportaion
100% 100%
Changzhou Leotek New Energy
Leotek Electronics Holding Limited
Trade Limited
100% 100%
Lite-On Clean Energy Technology Lite-on Green Energy Kaiserslautern
Corp. GmbH
100% 100% 100%
Lite-on Green Energy (Singapore) Lite-on Green Energy B.V. Romeo Tetti PV1 S.R.L
Pte. Ltd.
100% 100% 100%
Lite-On Green Technologies Inc. Lite-On Green Technologies B.V Lite-on Green Technologies S.R.L
100% 100%
Lite-on Green Technologies Australia
Lite-on Green Energy (HK) Limited
Pty Ltd
100% 100% 100% 100%
LTC Group Ltd. LTC International Ltd. Lite-on Green Technologies (HK)Limited Lite-On Green Technologies(Nanjing) Corporation
100%
Titanic Capital Services Ltd.
100%
Lite-On Integrated Service Inc.
42.70% 0.33% 100%
Lite-On IT Corporation LET (HK) Ltd.
100% 100% 100%
Lite-On IT International (HK) Lite-On Opto Technology
High Yield Group Co., Ltd.
Ltd. (Guangzhou) Co., Ltd.
100% 100%
Lite-On IT Trading (Guangzhou)
Lite-on IT Singapore Pte. Ltd.
Co., Ltd.
100% 100%
Lite-On Sales & Distribution Inc. Lite-On IT Opto Tech (BH) Co.,
Ltd.
100% 100%
Lite-On Information Technology Lite-On Information Technology
B.V. GmbH
100% 100%
Automotive Playback Modules Hungary Electronical
Lite-On Americas Inc. Mechanical Manufacturing and Trading Limited Liability
Company
49% 100%
Philip & Lite-On Digital Philips & Lite-On Digital Solutions
Solutions Corp. USA Inc.
100%
Philips & Lite-On Digital Solutions
Netherlands B.V.
100%
Philips & Lite-On Digital Solutions
Germany GmbH
100% 100%
Lite-On Electronics (Thailand) Co., Philips & Lite-On Digital Solutions
Ltd. Korea Ltd.
100%
Philips & Lite-On Digital
Solution (Shanghai) Co. , Ltd.
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----- Start of picture text -----

100% 100% 50% 100%
Lite-On International Holding Co.,
Lite-On Technology Corporation Ltd Lite-On China Holding Co., Ltd. G&W Technology (BVI) Limited G&W Technology Limited
100% 100%
Lite-On Communications
Lite-On Electronics Co., Ltd.
(Guangzhou) Co., Ltd.
100%
Lte-On Elec and Wire
(Guangzhou) Co., Ltd.
100% 100%
I-Solutions Limited Lite-On (Guang Zhou) Infortech
Co., Ltd.
100% 100%
Silitek Elec. (Guangzhou) Co.
Visonpak (Guangzhou) Co., Ltd.
Ltd.
100%
Lite-On (Guang Zhou) Precision
Tooling Co., Ltd.
100%
Lite-On Tech. (Guangzhou) Co.,
Ltd.
100% 100%
Lite-On Electronics (Guangzhou) Lite-On Technology (Guangzhou)
Co. Ltd. Co., Ltd.
100% 100%
Lite-On Technology (Guangzhou) Lite-On Opto Technology
Co., Ltd. (Changzhou) Co., Ltd.
100%
Lite-On Power Technology
(Dongguan) Co., Ltd.
100% 100%
Lite-On Li Shin Technology
Yet Foundate Ltd.
(Guangzhou) Co., Ltd.
100% 100%
Dongguan Lite-On Computer Co.,
Fordgood Electronic Ltd.
Ltd.
48.13% 100%
Ze Poly Pte. Ltd. Ze Poly Tomsk Ltd.
100% 100%
Lite-On Electronics H.K. Ltd. Silitek Elec. (Dongguan) Co.,
Ltd.
100%
Lite-On Digital Electronics
(Donguan) Co., Ltd.
100%
Lite-On Computer Tech
(Dongguan) Co., Ltd.
100%
Dong Guan G-Com Computers Co.,
Ltd.
100%
Dong Guan G-Tech Computers Co.,
Ltd.
100%
Lite-On Electronics (Dongguan) 20.71%
Co., Ltd.
100%
Lite-On Electronics (Tianjin)
Co., Ltd.
79.29%
DongGuan G-pro Computer Co.,
Ltd.
100% 100%
China Brige Express (Wuxi) Co.,
China Bridge (China) Co., Ltd.
Ltd.
100% 100%
Lite-On Power Technology (Chang Zhou) Lite-On Electronics (Chang Zhou) Co.,
Co., Ltd. (original name: Li Shin Ltd. (original name: Wuxi Lite-On Tech.
Enterprise (Su Zhou) Co., Ltd.) Co., Ltd.)
100% 100%
Lite-On Technology (Ying Tan)
Lite-On Singapore Pte. Ltd.
Co., Ltd.
100%
Lite-On Technology (Xianing)
Co., Ltd.
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(Continued)

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

100% 100%
Lite-On Technology Corporation Lite-On Technology USA Inc. Lite-On Trading USA, Inc.
100%
Lite-On Service USA, Inc.
100%
Lite-On, Inc.
100%
Maxi Switch S.A. de C.V
100%
Lite-On Electronics (Europe) Ltd.
100%
Lite-On Overseas Trading Co., Ltd.
100%
Lite-On Automotive Electronics
(Europe) BV
100%
Lite-On Automotive North America
Inc.
84.89% 100% 100% 100%
Lite-On Automotive International Lite-On Automotive Holdings
Lite-On Automotive Corp. 敦揚 ( 廣州 ) 汽車電子有限公司
(Cayman) Co., Ltd (Hong Kong) Ltd.
100%
敦揚科技(無錫)有限公司
100% 100%
Silitech Technology (SuZhou) Co.,
Silitech (Hong Kong) Holding Ltd.
Ltd.
32.69% 100% 100% 100%
Silitech Technology Corporation
Silitech Technology Corp. Silitech (BVI) Holding Ltd. Silitech (Bermuda) Holding Ltd.
Sdn. Bhd.
100%
0.62% Silitech Technology (Europe) Limited
100% 100% 100% 100% 100%
Silitech Technology Corporation Xurong Electronic (Shenzhen) Co.,
Lite-On Capital Inc. Lite-On Japan(s) Pte. Ltd. Lite-On Japan (Thailand) Co., Ltd.
Limited Ltd.
100% 100% 55.00% 100%
Silitech International (India) Private Silitech Plating (ShenZhen)
7.87% L&K Industries Philippines, Inc. Silitek Plating Limited
Ltd. Co., Ltd.
100% 100% 60%
SuZhou Xulong Mold Producing Co.,
Lite-On Japan (H.K.) Ltd. NL (Shanghai) Co., Ltd.
Ltd.
49.49% 100% 100% 100%
Silitech Surface Treatment
Lite-On Japan Ltd. LOJ Korea Co., Ltd. Major Suit (HK) Co. Ltd.
(Shenzhen) Co., Ltd.
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(Continued)

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

100% 20.66% 100% 100% 100%
Li Shin International Logah Electronics (Su Zhou) Co.,
Lite-On Technology Corporation Logah Technology Corp. Logah Technology Co., Ltd. Logah Technology (HK) Co., Ltd.
Enterprise Corp. Ltd.
18.97% 100%
Lippo Electronics (Su Zhou) Co.,
100%
Ltd.
Suzhou Fordgood Electronic Co.,
Ltd.
100% 100%
Li Shin International Enterprise Huizhou Li Shin Electronic Co.,
Corp. Ltd.
100% 100%
Huizhou Fu Tai Electronic Co.,
Eagle Rock Investment Ltd.
Ltd.
100%
Li Shin Technology (Huizhou)
Ltd.
54% 100% 100% 100%
Lite-On Technology (Europe) B.V. Lite-On (Finland) Oy Lite-On Mobile Oyj Lite-On Mobile Sweden AB
100% 100% 100%
Lite-On Mobile Indústria e Comércio de
Lite-On Capital Inc. Lite-On Mobile Pte. Ltd.
Plásticos Ltda.
46%
100%
Guangzhou Lite-On Mobile Engineering
Plastics Co. Ltd.
100%
Beijing Lite-On Mobile Electronic and
Telecommunications Components Co., Ltd.
100%
Shenzhen Lite-On Mobile Precision
Molds Co., Ltd.
100%
Perlos Precision Plastics Moulding
Limited Liability Company
100%
Lite-On Mobile India Private Limited.
100% 100%
Lite-On Young Fast (Huizhou) Co.,
Lite-on Young Fast Pte. Ltd.
Ltd.
100% 100%
Guangzhou Lite-on Mobile Electronic Yantai Lite-On Mobile Electronic
Components Co. Ltd. Components Co., Ltd.
11%
89% Zhuhai Lite-On Mobile Technology
Co., Ltd.
----- End of picture text -----

(Continued)

March 31, 2011

==> picture [734 x 637] intentionally omitted <==

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

100% 73.40% 100%
Lite-On Technology Corporation Lite-On Capital Inc. Leotek Electronics Corp. Leotek Electronics USA Corportaion
100%
Lite-On Clean Energy Technology Lite-On Green Energy Kaiserslauter
Corp. GmbH
100% 100% 100%
Lite-on Green Energy (Singapore) Lite-on Green Energy B.V. Romeo Tetti PV1 S.R.L
Pte. Ltd.
100% 100% 100%
Lite-On Green Technologies Inc. Lite-On Green Technologies B.V Lite-on Green Technologies S.R.L
100% 100%
Lite-on Green Technoligies Australia
Lite-on Green Energy (HK) Limited
Pty Ltd.
100% 100% 100% 100%
Lite-on Green Technoligies (HK) Lite-On Green Technologies
LTC Group Ltd. LTC International Ltd.
Limited (Nanjing) Corporation
100%
Titanic Capital Services Ltd.
100%
Lite-On Integrated Service Inc.
43.01% 0.33% 100%
Lite-On IT Corporation LET (HK) Ltd.
100% 100% 100%
Lite-On IT International (HK) Lite-On Opto Technology
High Yield Group Co., Ltd.
Ltd. (Guangzhou) Ltd.
100% 100%
Lite-On IT Trading (Guangzhou)
Lite-on IT Singapore Pte. Ltd.
Ltd.
100% 100%
Lite-On IT Opto Tech (BH) Co.,
Lite-On Sales & Distribution Inc.
Ltd.
100% 100%
Lite-On Information Technology Lite-On Information Technology
B.V. GmbH
100% 100%
Automotive Playback Modules Hungary Electronical
Lite-On Americas Inc. Mechanical Manufacturing and Trading Limited Liability
Company
49% 100%
Philip & Lite-On Digital Philips & Lite-On Digital Solutions
Solutions Corp. USA Inc.
100%
Philips & Lite-On Digital Solutions
Netherlands B.V.
100%
Philips & Lite-On Digital Solutions
Germany GmbH
100% 100%
Lite-On Electronics (Thailand) Co., Philips & Lite-On Digital Solutions
Ltd. Korea Ltd.
100%
Philips & Lite-On Digital
Solutions (Shanghai) Co., Ltd.
----- End of picture text -----

(Continued)

==> picture [886 x 664] intentionally omitted <==

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

100% 100% 50% 100%
Lite-On International Holding Co.,
Lite-On Technology Corporation Ltd Lite-On China Holding Co., Ltd. G&W Technology (BVI) Limited G&W Technology Limited
100% 100%
Lite-On Communications (GZ)
Lite-On Electronics Co., Ltd.
Co., Ltd.
100% 100%
Lite-On Elec and Wire (GZ)
Yet Foundate Ltd.
Co., Ltd.
100% 100%
I-Solutions Limited Lite-On (Guang Zhou) Infortech
Co., Ltd.
100%
Silitek Elec. (GuangZhou) Co.,
Ltd.
100%
Lite-On (Guang Zhou) Precision
Tooling Co., Ltd.
100%
Lite-On Tech. (Guang-Zhou) Co.,
Ltd.
100%
Lite-On Electronics (GZ) Co.,
Ltd.
100% 100%
Lite-On Technology (Guangzhou) Lite-On Technology (Changzhou)
Co., Ltd. Co., Ltd.
100% 100% 100%
Lite-On Li shin Technology Lite-On Opto Technology
Fordgood Electronic Ltd. (Ganzhou) Co., Ltd. (Changzhou) Co., Ltd.
100%
LTC International (L) Bhd.
100%
LOE-NEL Ltd.
55% 100%
Ze Poly Pte. Ltd. Ze Poly Tomsk Ltd.
100% 100%
Lite-On Electronics H.K. Ltd. Silitek Elec. (DG) Co., Ltd.
100%
Lite-On Digital Electronics
(DG) Co., Ltd.
100%
Lite-On Computer Tech (DG)
Co., Ltd.
100%
Dong Guan G-Com Computers Co.,
Ltd.
100%
Dong Guan G-Tech Computers Co.,
Ltd.
100%
Lite-On Electronics (DG) Co., 20.71%
Ltd.
100%
Lite-On Electronics Tianjin
Co., Ltd.
79.29%
DongGuan G-pro Computer Co.,
Ltd.
100% 100%
China Bridge Express (Wuxi)
China Bridge (China) Co., Ltd.
Co., Ltd.
100% 100%
Lite On Power Technology (Chang
Zhou) Co., Ltd.
Wuxi Lite-On Tech. Co., Ltd.
(original name: Li Shin
Enterprise (Su Zhou) Co., Ltd.)
100% 100%
Lite-On Technology (Ying Tan)
Lite-On Singapore Pte Ltd.
Co., Ltd.
100%
Lite-On Technology (Xianing)
Co., Ltd.
----- End of picture text -----

(Continued)

==> picture [1087 x 686] intentionally omitted <==

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

100% 100%
Lite-On Technology Corporation
Lite-On Technology USA Inc. Lite-On Trading USA, Inc.
100%
Lite-On Service USA, Inc.
100%
Lite-On, Inc.
100%
Maxi Switch S.A. de C.V
100% 100%
Lite-On Electronics (Europe) Ltd. Lite-On (Germany) GmbH
100%
Lite-On Overseas Trading Co., Ltd.
100%
Lite-On Automotive Electronics
(Europe) BV
100%
Lite-On Automotive North America
Inc.
87.31% 100% 100% 100%
Lite-On Automotive International Lite-On Automotive Holdings Lite-On Automotive Electronics
Lite-On Automotive Corp.
(Cayman) Co., Ltd (Hong Kong) Ltd. (Guang Zhou) Co., Ltd.
100%
Lite-On Automotive (Wuxi) Co.,
Ltd.
100% 100%
Silitech (Hong Kong) Holding Ltd. Silitech Technology (SuZhou) Co., Ltd.
39.63% 100% 100% 100%
Silitech Technology Corporation
Silitech Technology Corp. Silitech (BVI) Holding Ltd. Silitech (Bermuda) Holding Ltd.
Sdn. Bhd.
100%
063% Silitech Technology (Europe) Limited
100% 100% 100% 100%
Silitech Technology Corporation
Lite-On Capital Inc. Lite-On Japan(s) Pte. Ltd. Lite-On Japan (Thailand) Co., Ltd. Xurong Electroinc (Shenzhen) Co., Ltd.
Limited
100% 55.00% 100%
L&K Industries Philippines, Inc. Silitek Plating Limited Silitech Plating (ShenZhen) Co., Ltd.
7.87%
100% 100% 40%
SuZhou Xulong Mold
Lite-On Japan (H.K.) Pte. Ltd. NL (Shanghai) Co., Ltd.
Producing Co., Ltd.
49.49% 100% 100% 100%
Silitech Surface Treatment
Lite-On Japan Ltd. LOJ Korea Co., Ltd. Major Suit (HK) Co. Ltd.
(Shenzhen) Co., Ltd.
(Continued)
----- End of picture text -----

==> picture [990 x 637] intentionally omitted <==

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

100% 20.66% 100% 100% 100%
Lite-On Technology Corporation
Li Shin International Enterprise Corp. Logah Technology Corp. Logah Technology Co., Ltd. Logah Technology (HK) Co., Ltd. Logah Electronics (Su Zhou) Co., Ltd.
18.97% 100%
100% Lippo Electronics (Su Zhou) Co., Ltd.
Suzhou Fordgood Electronic Co., Ltd.
100% 100%
Li Shin International Enterprise Corp. Huizhou Li Shin Electronic Co., Ltd.
100% 100%
Eagle Rock Investment Ltd. Huizhou Fu Tai Electronic Co., Ltd.
100%
Li Shin Technology (Huizhou) Ltd.
54% 100% 100% 100%
Lite-On Mobile Oyj
Lite-On Technology (Europe) B.V. Lite-On (Finland) Oy Perlos Mexico Holding Corp.
(formerly Perlos Oyj)
100% 100%
Lite-On Capital Inc. Perlos AB
46% 100% 99%
Lite-On Mobile Pte. Ltd. Perlos Mexico, S. A. de C.V
100%
Lite-On Mobile Indústria e Comércio de
Plásticos Ltda.
100%
Guangzhou Lite-on Mobile Engineering
Plastics Co. Ltd.
100% 100%
Guangzhou Lite-on Mobile Electronic Yantai Lite-On Mobile Electronic
Components Co. Ltd. Compoents Co., Ltd.
100%
Beijing Lite-On Mobile Electronic and
Telecommunication Components Co., Ltd.
100%
Shenzhen Lite-On Mobile Precision Molds
Co., Ltd.
100%
Perlos Precision Plastics Moulding
Limited Liability Company
100%
Perlos Telecommunication and Electronic
Components (India) Private Ltd.
100% 100%
Lite-On Young Fast Pte. Ltd. Lite-On Young Fast (Huizhou) Co., Ltd.
----- End of picture text -----

(Concluded)

AI assistant

LTC — Interim / Quarterly Report 2012

51997_rns_2013-04-29_a0949fae-12b6-4d0c-b42b-2b04cb2ce359.pdf

Lite-On Technology Corporation and Subsidiaries

INDEPENDENT ACCOUNTANTS’ REVIEW REPORT

Notice to Readers

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS MARCH 31, 2012 AND 2011

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME THREE MONTHS ENDED MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME THREE MONTHS ENDED MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars, Except Earnings Per Share) (Reviewed, Not Audited)

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2012 AND 2011 (In Thousands of New Taiwan Dollars) (Reviewed, Not Audited)

LITE-ON TECHNOLOGY CORPORATION AND SUBSIDIARIES

1. ORGANIZATION AND OPERATIONS

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Basis for Consolidation

Current and Noncurrent Assets and Liabilities

Financial Assets/Liabilities at Fair Value through Profit or Loss

Revenue Recognition, Accounts Receivable and Allowance for Doubtful Accounts

Construction Contracts

Inventories

Financial Assets Carried at Cost

Bond Investments with No Active Market

Available-for-sale Financial Assets

Long-term Equity Investments

Properties and Leased Assets

Intangible Assets

Land Use Rights

Idle Assets

Deferred Charges

Asset Impairment

Product Warranty Reserve

Pension Costs

Treasury Stock

Stock-based Compensation

Income Tax

Translation of Foreign-currency Financial Statements and Foreign-currency Transactions

Hedging Derivative Financial Instruments

Hedge Accounting

3. ACCOUNTING CHANGES

Financial Instruments

Operating Segments

4. CASH AND CASH EQUIVALENTS

5. FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

Silitech Technology Corp.

6. AVAILABLE-FOR-SALE FINANCIAL ASSETS - CURRENT

7. ACCOUNTS RECEIVABLE, NET

Silitech Technology Corp.

8. INVENTORIES, NET

9. CONSTRUCTION IN PROGRESS IN EXCESS OF PROGRESSIVE BILLINGS

10. AVAILABLE-FOR-SALE FINANCIAL ASSETS - NONCURRENT

11. FINANCIAL ASSETS CARRIED AT COST

12. INVESTMENTS ACCOUNTED FOR BY THE EQUITY METHOD

13. PROPERTIES

14. INTANGIBLE ASSETS

a. Patents and other intangible assets

b. Goodwill

15. OTHER ASSETS

b. Idle assets, net

c. Overdue receivables

16. SHORT-TERM BANK LOANS

17. LONG-TERM BANK LOANS (INCLUDING CURRENT PORTION)

18. OBLIGATIONS UNDER CAPITAL LEASES

19. SHAREHOLDERS’ EQUITY

Employee Stock Option Plans

Capital Surplus

Appropriation of Earnings and Dividend Policy

20. TREASURY STOCK (COMMON STOCK)

Unit: In Thousand Shares

21. EARNINGS PER SHARE

22. RELATED-PARTY TRANSACTIONS

23. MORTGAGED OR PLEDGED ASSETS - NONCURRENT

24. SIGNIFICANT COMMITMENTS AND CONTINGENT LIABILITIES

25. FINANCIAL INSTRUMENTS

a. Fair values of financial instruments were as follows:

LTC Interim / Quarterly Report 2012